Gold is wealth protection against every currency and not just the dollar as the metal is at or near all-time highs in 72 countries

11:58 AM currencies, dollar, gold, gold price, reserve currency, wealth protection No Comments

Contrary to popular belief, the world runs on more than just five primary currencies (Dollar, Pound, Euro, Yen, Franc).  But because the U.S. still has control over the global reserve currency, the narrative often is that all other currencies really don't count.

For thousands of years gold been both a balance and a check on the avarice of men and governments when it comes to purchasing power.  And in a new report out this week, gold still continues to do so as 72 national currencies are now at, near, or above their all-time highs in relation to the price of gold.

Popular belief has it that gold prices have not performed especially well despite some egregious geopolitical and economic factors. Well measured in 72 currencies, gold is at ... or within a few percentage points ... of being at an all time high for people in those countries. Not on the list are the British Pound, the Swiss Franc, the Euro and Chinese Yuan - but we are not far off in all of those currencies too. Only in USD does gold lag - and not all of us live in the US.  - Zerohedge

And here by the way is a list of these 72 nations and currencies.

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Central banker asserts Chinese yuan will challenge dollar as primary reserve currency

10:23 AM bank of england, bi-lateral trade, central banker, china, dollar, dollar hegemony, reserve currency, yuan 1 Comment

On Jan. 10, Britain's chief central banker asserted during a forum that the Chinese Yuan will soon challenge the dollar as a primary reserve currency.

Speaking in a conference regarding Future global trends, Bank of England head Mark Carney stated that the days of the dollar being the singular reserve currency are diminishing, and that the Chinese yuan appears to be the best choice to rival dollar hegemony.

The US dollar may one day be rivaled by the Chinese national currency – the yuan – which is likely to become a major global reserve currency, according to the governor of the Bank of England (BoE), Mark Carney. 

“I think it is likely that we will ultimately have reserve currencies other than the US dollar,” the UK top financial official claimed during an online question-and-answer session carried out as part of the Bank of England’s Future Forum. 

According to Carney, the global financial system is currently lagging behind the evolution of the global economy, facing asymmetric concentrations of financial assets in advanced economies relative to economic activity. 

“As the world re-orders, this disconnect between the real and financial is likely to reduce, and in the process other reserve currencies may emerge. In the first instance, I would expect these will be existing national currencies, such as the renminbi,” he said. – Russia Today

Besides being added to the IMF's basket of currencies in recent years, China is suddenly becoming the go-to currency for large swaths of the global economy as the U.S. continues to sanction or use the dollar as an economic weapon on nations that reject their hegemony.

While it is unlikely that sovereign economies will call for a new 'Bretton Woods' to remove the dollar's status as the world's singular reserve currency, it instead appears that the dollar will continue to become isolated or even rejected more and more in exchange for bi-lateral trade, and thus it will eventually lose its place atop the global monetary system through a de facto takeover.

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Protests in France about to escalate as Yellow Vests planning a run on the banks to cripple the financial system

7:03 PM bank run, france, macron, protests, yellow vests No Comments

Protests are great, but as they say, money talks and bulls*it walks.  And after weeks of demanding regress from the Macron government with little to show, leaders of the Yellow Vest movement are upping the stakes by planning that protesters conduct a run on the banks in the coming days.

French grassroots political movement the Gilets Jaunes — Yellow Vests — is planning a bank run similar to Bitcoin’s (BTC) Proof of Keys, sources revealed on social media Jan. 7. 

Dubbed the “Collectors’ Referendum,” the latest demonstration by the movement calls on supporters to withdraw all their savings and other deposited cash from financial institutions on Saturday. 

Speaking in a video uploaded to Facebook, an activist known only as Tahz San said the gesture aimed to “scare this (French) state completely legally and without any violence, yet more effectively than ever expected” throughout the history of the Gilet Jaunes movement. 

“It’s our elected officials’ worst nightmare,” he added. 

As local magazine Capital notes, the potential disruptive element of the Referendum could technically be considerable. - Cointelegraph

By declaring on social media the potential for tens of thousands of people to pull their money out of the banking system, it is likely that the Macron government will enact plans to either limit or halt any withdrawals before they begin.  However this is also a catch-22 since a bank holiday or capital controls imposed on the people will extend to every French and EU citizen living in the country, and spark even greater consequences similar to what we saw in India just a few years ago.

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With China, the U.S., and Europe entrenched in a tariff war, Africa is preparing to become a continental free trade zone

11:19 AM Africa, brics, china, free trade zone, tariffs, trade war No Comments

With the global economy deeply entrenched in an ongoing tariff and trade war, one region of the world is looking to free itself from the restrictions that governments impose on free trade.

In a new report out on Dec. 26, South Africa is ratifying a 49 nation treaty to make the entire continent of Africa a virtual free trade zone.

South Africa’s and Togo’s parliaments this month ratified the agreement establishing the African Continental Free Trade Area (AfCFTA). The total number of countries committing to the deal has thus grown to 49. 

Once the agreement comes into effect, it will create a tariff-free continent, covering a single market of 1.2 billion people in 55 nations with a combined gross domestic product of about $3 trillion. 

It will constitute the largest free trade area globally, according to South African Trade and Industry Minister Rob Davies. 

Economists say that tariff-free access to a huge and unified market will encourage manufacturers and service providers to leverage economies of scale. - Russia Today

Over the past five years, China has been investing heavily into Africa, and the country of South Africa has been a solid member of the BRICS coalition.  And with more and more nations rejecting globalism and seeking to participate in trade agreements using their own currencies, the time appears right for Africa to open its doors to new investment and development and potentially become the fastest growing region of the 21st century.

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Gold and silver continue their own Santa Claus rallies by moving over $1275 and $15 respectively after Christmas

10:16 AM equity markets, federal reserve, gold, gold price, monetary policy, rally, safe haven, silver, silver price, stock markets No Comments

Gold and silver prices expectedly took a dive a week ago following the Federal Reserve's announcement to continue with their policy of raising rates.  But this pullback didn't last long as the metals have subsequently moved upward every day after, and appear to be one of the primary safe haven assets investors are using to move cash into during the global equity selloff.

In fact not only have both gold and silver regained their 200 day moving averages in just the past five days of trading, their momentum has pushed prices above $1275 and $15 respectively for both metals.

Gold price:

Silver Price:

If volatility continues in the equity market through the rest of 2018 and into early next year, chances are very good that gold will soon break through a year long resistance level of $1300.  Yet only time will tell if this is only a short term rally for the precious metals since the European Central Bank is just beginning its cancellation of the same money printing policies the U.S. used to prop up their markets.

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World's largest commodity is now on Blockchain as North Sea oil market first to begin trading on platform

1:48 PM blockchain, brent crude, north sea oil, oil, oil market, russia, trading No Comments

While most of the financial world is caught up in the cryptocurrency craze, most investors often forget that cryptos are simply assets traded on a much bigger platform.  And now on Dec. 2 we can add oil trading to this engine as the North Sea oil market has officially moved to trading on the Blockchain.

Oil majors and trading firms can start finalizing crude oil deals on a live blockchain-based platform for the first time, in a move that could revolutionize the market. 

Commodities trading firms have piloted similar schemes in recent years as blockchain technology has the potential to drastically cut costs in an environment of razor-thin profit margins. 

London-based platform Vakt is the first of these to go live, with shareholder Gunvor Group saying it was rolled out on Nov. 28, although no trades took place that day. 

Blockchain, the platform behind cryptocurrency Bitcoin, is viewed by many as a solution to trade and settlement inefficiencies, as well as a way to improve transparency and reduce the risk of fraud. – Epoch Times

The North Sea oil market was not the first to begin transitioning its trading to the blockchain, as Russia is also in the process of doing this for both their energy and agricultural markets.  However they appear to be the first major market to be ready to go live, and it will interesting to see how soon most Brent Crude trading also transitions over to the Blockchain once it fully kicks into gear.

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EU initiates proposal to dump the dollar and to create a PetroEuro system

1:32 PM dollar, dollar hegemony, dump dollars, eu, euro, european union, iran deal, jcpoa, petrodollar, petroeuro No Comments

When the U.S. and President Trump decided to renege on the JCPOA Iran nuclear agreement, it set in motion the will within Europe to reject this action and to seek alternatives to dollar hegemony.  And besides a plan to create their own continental SWIFT alternative, the European Commission on Dec. 3 initiated plans to not only drop the dollar as a trade settlement currency, but also to create their own 'PetroEuro' for use in energy deals.

Amid increasing tensions between Trump and various European leaders (cough Macron cough) and the ongoing threats of sanctions and tariffs, the European Commission plans to outline initiatives to develop the international role of the euro, according to a draft document obtained by Bloomberg. 

As Viktoria Dendrinou reports, the plan has three dimensions including the European financial sector, the international financial sector and key strategic sectors such as energy... 

Member states should promote wider use of the euro in relations with third countries in field of energy, including in contracts within the framework of bilateral and multilateral international agreements,” intergovernmental agreements with third countries a model clause, developed by the Commission, related to the use of the euro as default currency”

“Participants in European energy markets should use more energy-related contracts denominated in euro” 

“Price reporting agencies should facilitate the launching of euro-denominated price benchmarks for crude oil” 

“Commodity exchanges should facilitate the further development of euro-denominated derivative contracts on crude oil and refined products”- Zerohedge

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Qatar initiates an OPEC 'Brexit' as they will leave the cartel at beginning of 2019

1:01 PM brexit, economic sanctions, iran, opec, petrodollar, qatar, sanctions, saudi arabia No Comments

With a new report out showing that 40% of the world's energy production is now controlled by just three countries (with two of them not even part of OPEC), the power and authority once held by the Middle Eastern cartel appears to be waning fast.  And in response to this, and the dying Petrodollar agreement, Qatar announced on Dec. 3 that they will officially be leaving OPEC at the beginning of next year.

Qatar leaving the Organization of the Petroleum Exporting Countries (OPEC) is largely a symbolic step, expert tells RT, as the Gulf state is a marginal player in the oil trade. But they say repercussions will be felt in Riyadh. 

While the move is merely symbolic for Qatar, a founding member quitting OPEC after 57 years cannot look positive for the organization, John Hall, chairman of Alfa Energy, a UK-based consulting company said in an interview with RT. 

“They are making their point,” the expert said, stressing Doha was driven by Saudi Arabia and the Saudi-led blockade. “It will hit [the] credibility of the OPEC, as well as it will hit Saudi Arabia as the de-facto leader of the OPEC.” - Russia Today

While Qatar is certainly not a heavyweight in OPEC, it is a charter member who's significance in the region cannot be understated.  And with their largest natural gas facilities being tied to Iran in a joint partnership, they cannot afford to be sanctioned or coerced by the Saudi's, especially since the U.S. has instigated a return of sanctions on Iran.

Indeed, it is fairly apparent that Qatar has been in the process of disconnecting itself from OPEC for some time, especially since they have already begun to accept Chinese Yuan and Euros as trade payment in the past year at the expense of the Petrodollar.  And with the likelihood of Saudi Arabia losing more and more of its authority in the region thanks to Russia's growing market share and the escalation of U.S. production, OPEC's days are surely numbered and as with any breakup, those who exit the door first usually end up with the least amount of pain.

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Bitcoin regains $4000 handle after sustaining another 10% loss overnight

5:58 PM bitcoin, bitcoin price, cryptocurrencies, cryptocurrency market cap, investors, momentum, selloff, sentiment No Comments

Bitcoin's crash over the past week continued up until the start of Asian trading here on Nov. 25 after falling as low as $3578 earlier today.  However it appears that buying volume across the entire cryptocurrency sector has helped propel it back over $4000 per coin.

Speaking on CNBC’s “Squawk Box,” Moro suggested that the leading cryptocurrency will lose another 30 percent before bottoming at $3,000. Moro said, “You really won’t find [the floor] until you kind of hit the 3K-flat level.” 

Moro addressed small resistance levels, saying that he does not think the BTC price can stabilize in “the mid-3s,” also noting that the $4,000 level was tested twice in the previous days. - Zerohedge

Looking at the entire cryptocurrency sector as a whole, Bitcoin's small recovery has been followed by positive gains across the board for the top 20 tokens.

Inevitably, 2018 will have proven itself to be a terrible year for the sector as more than 80% of its market cap has been lost over the past 10 months.  And with investors more worried about finding safe havens from equity markets that are themselves starting to sell off, it is unlikely that cryptocurrencies like Bitcoin will gain much traction since both momentum and sentiment appear to  be extremely negative.

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Congress appears to be secretly preparing taxpayer bailouts for private pensions

5:41 PM congress, pension funds, private pensions, taxpayer bailout, underfunded No Comments

With numerous retailers filing for bankruptcy over the past two years, and private pensions having reached the point of extreme underfunding, some members of Congress are looking to use the taxpayer once again as a bailout device to protect their donors and constituents.

In a new expose on a Congressional committee meant to find solutions to the country's vast pension shortfalls, one proposal to emerge would entail the taxpayer coughing up $3 billion a year to go into the Pension Benefit Guarantee Corporation (PBGC) which normally is funded by corporations that use it as a backstop in case of their own bankruptcies and insolvencies.

It shouldn't come as a surprise that, in the first draft of its plan to save these pensions, the committee proposed restoring the Pension Benefit Guaranty Corporation (PBGC) to solvency with - you guessed it - taxpayer backed "subsidies" from the Treasury to the tune of $3 billion a year. The plan is also considering raising premiums, introducing new fees and - importantly - cutting benefits. 

A draft of the plan, obtained by The Washington Post, would direct the Treasury Department to spend up to $3 billion annually to subsidize payments for retirees from certain underfunded pensions. 

It would also require benefit cuts, higher premiums and new fees levied against companies and union members in an attempt to make the pensions as financially solvent as possible. The proposal aims to require all parties involved to make significant concessions and caps taxpayer contributions. 

The retirement programs are called "multiemployer" pensions, as workers from multiple companies pay into the same retirement benefit program. But many of these pensions lack the financial assets to cover the benefits they have promised retired workers, leading to a panic from retirees who were counting on the funds. These pensions often have been plagued by mismanagement, inaccurate economic projections and in some cases corporate bankruptcies. - Zerohedge

The PBGC is similar to the FDIC, which itself is normally funded by fees paid for by the banks to protect depositors from institutional insolvencies.  However like its sister program, the PBGC holds just pennies on the dollar in relation to the amount of pensions they are supposed to backstop.

Thanks to Fed policies of low interest rates and more than a decade of monetary inflation, both private and public pensions are now underfunded by a good 40-75%.  And since this is a trillion dollar industry when you count in the obligations owed by the states and corporations, it would be impossible for Congress to even attempt to instigate a massive taxpayer bailout since the people still remember when their money was used a decade ago to bail out the banks.

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