A “renminbi bloc” has been formed in East Asia, as nations in the region abandon the US dollarand peg their currency to the Chinese yuan — a major signal of China’s successful bid tointernationalize its currency, a research report has said.
The Peterson Institute for International Economics, or PIIE, said in its latest research that Chinahas moved closer to its long-term goal for the renminbi to become a global reserve currency.
Since the global financial crisis, the report said, more and more nations, especially emergingeconomies, see the yuan as the main reference currency when setting their exchange rate.
And now seven out of 10 economies in the region — including South Korea, Indonesia,Malaysia, Singapore and Thailand — track the renminbi more closely than they do the USdollar. Only three economies in the group — Hong Kong, Vietnam, and Mongolia — still havecurrencies following the dollar more closely than the renminbi, said the report, posted on theinstitute’s website.
China Persists In Refusing To Buy US Paper As Foreign LTM Purchases Of Treasurys Plunge To Three Year Lows
Yesterday’s TIC data held two important pieces of data. The first is that in September, the month that Bernanke launched QEternity, for the first time in 2012, foreigners were net sellers of US Treasurys, dumping a total of $17.3 billion in paper, with foreign official institutions selling $919 million and non-official “Other Foreigners” offloading a whopping $18.3 billion: a record amount for this data series! The combined outflow was a dramatic reversal from the August $42.9 billion in purchases, from the $341.8 billion in foreign purchases Year To Date, was the first outflow of 2012, the first since the $13.1 billion sold in December 2011, and finally was the biggest sale in US paper since May 2009, or the month Greece had its first (of many) bailouts. While the reason for this dramatic shift in sentiment toward US paper is not defined, perhaps a primary reason is that in September foreigners bought a whopping $23.8 billion in corporate US stocks, the most since July 2009, and certainly motivated by hope that the latest Bernanke easing would send stocks soaring. Oh how wrong they were to believe that, and to fall for the media’s latest attempt to force a rotation out of bonds and into stocks.
Williams Says Fed May Buy $85 Billion in Bonds Per Month
Federal Reserve Bank of San Francisco President John Williams said the central bank will probably buy about $85 billion in bonds per month starting in early 2013 and continue purchasing securities well into the second half of the year.
Marc Faber: “I keep in my toilet a picture of Mr. Bernanke. And every time I think about selling my gold,
I look at it and I know better!”
Faber’s big beef is with US Federal Reserve chairman Ben Bernanke. But “numerous Fed members make Mr. Bernanke look like a hawk,” he said. Nor does it matter who is running the White House. Because thanks to welfare and military budgets, “spending is out of control, tax is low, and most spending is mandatory.”
So Federal Reserve policy is inevitable, Faber went on, and while we haven’t yet got the negative interest rates demanded by Fed member Janet Yellen, we have got negative real interest rates. The US and the West had sub-inflation interest rates in the 1970s too, and we got a boom in commodity prices then as well. But with exchange controls now missing from the developed world, “One important point,” said Marc Faber:
“I keep in my toilet a picture of Mr. Bernanke. And every time I think about selling my gold,
I look at it and I know better!”
Ron Paul on Stossel: “There’s NO LOOT LEFT left to divvy up!”
“It’s hard to divvy up loot when there’s none left to divvy up.”
Rep. Ron Paul, (R-Texas), on the current state of the economy and whether the administration can make corrections in the next four years.
ART CASHIN: We Are On The Verge Of A Major Currency War
“What troubles me in that area is the call for elections in Japan, and the fact that Mr. Abe, who had been Prime Minister, may come back. He has called for unlimited monetary easing from the Bank of Japan and the Ministry of Finance.
It sounds to me like we are on the verge of a major currency war, under the guise of monetary policy. He specifically said, ‘I want to see the rate of inflation go above 3%.’ Now I’m sure they are bright enough not to get into something like Germany in the Weimar Republic. But we’ve got central banks all around the world beginning to play with fire.”
G Edward Griffin: A New Currency is Coming Soon; and The US Dollar is a Big Scam – PT. 1 of 2
Avoiding The Fiscal Cliff = QE To Infinity
There is no reason to expect that renewed efforts at federal budget deficit reduction will result in anything more than the usual smoke and mirrors, further increasing, not reducing, long-term U.S. sovereign-solvency risk. In reality, the U.S. economy has not recovered, and no recovery is pending. Consumer liquidity remains severely impaired, and broad business activity continues to falter anew. As a result. the actual federal budget deficit going forward will be much worse than the relatively rosy numbers being used as the basis for government negotiations – John Williams, www.shadowstats.com
Everyone can draw their own conclusions about how this so-called “fiscal cliff” situation will play out, but the only way it can possibly be “resolved” is by postponing the inevitable. As Williams states: “Accordingly, global market reaction—to a severely deteriorating outlook for U.S. fiscal conditions—increasingly should reflect massive flight from the U.S. dollar and movement into gold and the stronger Western currencies.”
Peter Schiff: The Real Fiscal Cliff Is Dollar Crisis! Buy Gold! Buy Silver! Own Real Things!!!
What this tells me is that when the quickly coming Great Collapse of Western Economies (GCWE) occurs, these are the economies that will most likely have the best chance of surviving this otherwise global collapse:
3. South Korea
And secondly, it’s entirely probable that the following economies will see the light and join the new economic coalition:
1. Hong Kong
7. South Africa
If you want to plan on where to go to ride out this global economic disaster, this list will be a good starting point.
Some have already chosen this path.
Where will you be when this economic hurricane hits?