Column: China’s commodity import trend driven by prices, not economy
China's imports of major commodities are often viewed through the prism of the performance of, and outlook for, the world's second-biggest economy.
Veteran investment expert Richard Russell claims China is intent on obtaining leadership of the global economy by fortifying its official currency with the partial backing of the precious metal.
According to Russell in an interview with King World News, international investors are becoming increasingly averse to the US dollar as the Federal Reserve vitiates the fiat currency with multiple rounds of monetary easing.
Russell sees the Chinese yuan as an inevitable rival and threat to US dollar dominance, and believes that the “yuan will ultimately be partly backed by gold” as “part of China’s plan to take over leadership of the world.”
The staunch gold advocate cites historical precedent, noting that in the past the nation with the most powerful military was also the provider of the world’s reserve currency. The US dollar replaced the pound as the world’s preeminent currency once US military might surpassed that of the British Empire, and in Russell’s view China is angling to achieve a similar transition right now.
Despite conceding that gold is overbought at present, Russell also expects the precious metal to break through the USD$1,800 threshold due to a lack of secure or viable investment alternatives.
Image of Richard Russell courtesy of Youtube
2 Comments
disque1
Well it certainly is good to see Richard for as a long time subscriber here in Boston, I admire Richard and his valued experience and handclasp to the insight his long Life has Blessed him and We who attentively listen to Richard’s expergtise in the Dow Theory and his technical analysis of the markets globally –
With Germany and its fast deployment Army soon to march across into Syria, 600-800 Leopard tanks enroute to Qatar ad Saudi Arabia shortly and loads of small arms and ammunitions being sent into the Middle East, it is evident that the Bundestag has reemerged with strength and in the midst of a downsizing of the EU to only ten (10) nations and Germany soon to be surrounded by a Middle East Confederation of allies, the “Brutes of Tehran” have much to fear and it is not Israel which will always exist or the United States of America which has willingly reached to all who have been so utterly oppressed, but it is Germany which lime in history, is on the march and will again bring us to War!
With this said and in parallel with Richard’s enthusiasm for gold – you betch that gold will soar and even the lagging silver will surpise many –
Shortly, we will rid ourselves here in America of this “Chicago-Hollywood-Washington Express” and this “Rev Wright-Obama pulpit” so biased, so filled with hatred and intent to circumvent the Constitution and our Judeo-Christian values and intentionally snubbing the Hebrew, the same Jew who has special covenant to the Lord and No one, not Muslim or Christian will ever have complete control over Jerusalem for it is written so….Germany will now lead us to eventual War and is the enemy today as it was in the past to those who choose Liberty and Freedom over all that was – legal when Hitler was in power – and stripped the people and Gold will soar like an eagle! Soar in value!
In fact, as China’s global influence is further etched with time, the eventual strength of the Chinese Naval forces and the substantial deficits of the west will eventually see China at least partially back up the yuan with gold and the yuan will become the currency which will throw the dollar to the side and gold will soar!
Gold and silver – buy and hold as the time passes and we shall all remeber Richard Russell for his experienced perceptions and willingness to share his knowledge and make us all students of the Dow Theory – China and the good ‘ol USA will have much to say as time marches on, however it is the brillance of the scientists and engineers graduation in great numbers in Asia who will lead the world and gold will become an even more precious commodity much like honesty and far less sef-serving ways will be a Must in the west as attributes if the west is to have any real contribution to the global community….
Buy gold and even silver for the long run and for the immediate action required, oust this scoundral from the WH who has left Black America and its precious youth woth far greater unemployment and despair than in 2008, another failure in a along list of failures by a “Goldman Sachs WH” which could really give a care for those of us on “Main Street USA” proud of America and our Judeo-Chrtsian values —
Christopher Tingus
“Main Street USA”
PO Box 1612
Harwich, MA 02645 USA
skype: christopher.tingus
[email protected]
BillS
The Fed is certainly eroding the standing of the dollar through the mechanism of QE, and that will certainly, eventually catch up with us in the long run. However; I do not believe investors are ready, or will be in the next few years, to put more faith in the yuan than they do in the dollar.
If military might is the yardstick, the US military budget is larger than that of the next 17 countries COMBINED. China has just launched it’s FIRST aircraft carrier and has no experience in how to deploy them in actual warfare. Although China has a vast supply of Human capital, the US has a vast technological and communications superiority. Is China catching up? Sure, but they have a long way to go yet.
If Military might is not the yardstick, I could make a similar argument regarding the US economy vis-a-vis the ROW. Again, China is gaining ground and already making commerce in yuan the basis with some of its trading partners.
I do not think it is likely the dollar will remain the sole reserve currency in the world. But I do not see America laying down and letting the “brilliant scientists and engineers graduating in Asia” roll over it any time soon and Mr. Tingus apparently does.