Evidence of Move to New World Reserve Currency

April 5th, 2012 → 6:52 pm @ // No Comments

U. S. Dollar to become second-hand currency as Emerging World Economies assert Autonomy

 By SilverBombSquad, 4/05/2012

Departing World Bank head Robert Zoellick explains that “the goal for China is the internationalization of the Yuan”.  Instability in the western developed economies continues to reveal itself in “credit event” aftershocks ranging from the triggering of Greek Credit Default Swaps to the under-reported “stealth” expansion of the USD-denominated monetary supply.

Recent U.S.-led economic policies resulting from on-going tensions in the Middle-East have initiated an Eastern emerging nation “taking of sides” with Western sanction-hit Iran.  China, Russia, and India are seeking to by-pass “UN” sanctions against Iran and be able to access oil and to trade for other commodities with their political and economic ally.

Zoellick’s comments were in reference to the discussions held this week between leaders of emerging world economies about the creation of a New World Bank and monetary system that would better serve the interests of the emerging markets.  These economies often referred to as the “BRIC” nations, a collective acronym for the initials of some of the key players in the emerging markets namely Brazil, Russia, India, and China.  However, the actual order of their financial strength is not accurately portrayed by the handy moniker.

Of these, China has by far the strongest economy, followed by Russia, then Brazil, with India bringing up the rear.  This positions the Chinese Yuan (Renminbi) as the leading contender as the new reserve currency for an Eastern contender for the existing World Bank and International Monetary Fund.

As is discussed in The Silver Bomb, the central banks of the world are steadily increasing their monetary metal reserves in preparation for the coming shift.  Forced to protect themselves from the threat of capital and asset value loss by the potential default on western sovereign debt, China, Russia and others are quickly and quietly exiting from USD currency surplus reserves and bond investment positions.  This leaves them no realistic alternative than the ultimate creation of a new monetary structure that is independent from the current USD-based system.

The creation of a competing monetary system that removes the mantle of the “World’s Reserve Currency” from the U.S. Dollar is being carried forward with or without the cooperation of the existing economic power structure of the waning Western empire. As reported in a Mineweb article,

“this will mean that the world must move from a world united under the USD to one where there is a fragmented monetary system with at least two parts. This break demands a period where uncertainty, fear confrontation, and conditions generally detrimental to financial harmony must be endured until a new order is established. The potential for damage to the current monetary system is huge as it will be the one in decline while the new system is on the rise.”

This period of uncertainty is not being warned about in the mainstream media, whose entire function appears to be as a dispenser of truth-neutral distraction from the uncomfortable realities of the unfolding world of events.  Most Americans will never know what happened.  Their paper Dollar , once it is neutered, may become less valuable than blank paper. As Nobel Prize winner Milton Friedman put it,

“Only government can take perfectly good paper, cover it with perfectly good ink, and make the combination worthless.”

The Mineweb article correctly asserts that the New World Reserve Currency,

“will demand an “anchor of value”. And the uninterrupted presence of gold as a vital reserve asset in the developed world central banks -regardless of the words against gold spoken over those years-is sufficient evidence of the future vital role of gold in any monetary system.”

Gold and silver will return to their rightful place as is suggested in The Silver Bomb.  The subtitle after all is  — “Beyond the Return of Metal as Money.”  Silver, as is explained in the book, has a special but little understood role to play in the coming shift.  Regardless of the actual form a world reserve currency will take, monetary metal will be foundationally important to its evaluation and therefore will hold its value through the turbulence ahead.

“Forewarned is forearmed” is the operative phrase for those who will receive the call to action and protect their asset value through strategic investment in both gold and silver.  Pass the word.

Christopher Whitestone is co-author of The SilverBomb Beyond the Return of Metal as Money

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