"This is an interesting article for several reasons, not the least of which is that it is from a Russian publication and perspective, reflecting on the possible actions of China in the evolution of the global reserve currency regime.
As you know Russia is promoting a rethinking of the post Bretton Woods monetary system through their chairmanship of the G20 this year. There are other shoes to drop yet from that.
I suspect that China is playing chess here, or perhaps more appropriately the game of 'Go,' and not checkers. So snap judgements about what they are doing and why they are doing it are probably going to be fairly shallow. Most professionals and so-called experts are blinded by the status quo, lost in their own jargon and assumptions. There are many mechanics, but fewer systems thinkers.
Every action that is public masks a myriad of moves and countermoves done off the board and in quiet. Most who comment fail to grasp this because of cultural predilections.
Thoughts about capitalists selling rope do come to mind among other things relative to the short term and self-serving, stupidly greedy nature of the markets these days. But to borrow a phrase, economic power grows out of the barrel of a gun. It can call most hands.
Among other things the price discovery mechanism for gold currently resides with the Anglo-American financial establishment, which has been fairly shameless of late in shoving prices around the plate using paper leverage, and fixing key prices at will whether they reflect reality or not. That will have to be addressed. And I suspect it is well underway.
The terms of 'redeemability,' if any, are obviously of paramount importance in such a value reference to gold, as well as currency markets that are notorious for predatory practices, whether one wishes to acknowledge the rigging or not.
I am giving this more thought and will have other things to say about it in the future. But these are undeniably interesting times..."
at http://jessescrossroadscafe.blogspot.com/2013/07/china-reported-planning-to-back-yuan.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+JessesCafeAmericain+%28Jesse%27s+Caf%C3%A9+Am%C3%A9ricain%29
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