Maguire Is Right – China Will Send The Prices Of Gold & Silver Into The Stratosphere
from King World News With gold and silver surging on Friday, with the West’s desperate and massive money printing schemes as a backdrop, Andrew Maguire is right, China will send the price of gold and silver into the stratosphere. “For China, gold’s strategic mission is to support the internationalization of the renminbi and be a strong support for China’s goals of becoming an economic power and realizing the ‘Chinese Dream.’ Gold is the only product that holds properties of a commodity and currency; it’s the most trusty asset on which modern fiat currency can be based. From a historical perspective, gold has played an irreplaceable role in times of financial and geopolitical crises and in protecting a country’s economic security. It is this unique nature and function of gold that give it a glorious and holy role to play during the revitalization of the greatness of the Chinese people and the realization of the ‘Chinese Dream.’’’ — Song Xin
Stephen Leeb: “Song Xin is head of China’s only state-owned gold mining enterprise and party secretary in charge of gold. He uttered these words at a gold conference in the summer of 2014, and they clearly had the implicit approval of Chinese ministers all the way up to the Politburo… “I was reminded of them yesterday after seeing KWN’s report that, according to the always impressive Andrew Maguire, China and in particular the PBOC was stepping up efforts to encourage Chinese citizens to purchase gold. It made clear once again that China views gold as a very special commodity, one that stands head and shoulders above all others. What characteristic of gold makes China view it as so critical to its success? The answer is right there in the quote: gold is the “most trusty” asset to back up the Chinese currency. While in the West the arguments of those who believe that gold should have a major role as a currency fall mainly on deaf ears, in the East that view is already accepted. And while Westerners can only decry the absence of gold from Tier 1 bank assets, the Chinese can do something about it. Indeed, they must do something about it to realize their dream. My view is simple. In a world in which 17 percent of the population controls about 70 percent of the material wealth, global development will require massive resources – resources that because of growing scarcities are not immediately available and may never be available. Gold is the only suitable currency to ration such scarcities. Silver To Ascend As Solar Dominates The World As I noted last week, to increase our use of solar power enough to simply put a dent in our use of fossil fuels will require more silver than we produce in a year. For solar power to account for a meaningful amount of energy will require more silver than we could produce in a generation or perhaps more than exists in the world. And the situation is similar for virtually all other commodities, from oil to iron ore to lithium. Since the beginning of this century, when China strode onto the world stage, commodities have all begun to correlate with one another. Even those that are seemingly plentiful, like iron ore, have correlated strongly with commodities like oil that were growing scarcer, because oil is needed to transport iron ore. Without oil, iron ore will just sit in the ground. These mutual scarcities mean building out an energy infrastructure for the 21st century is a daunting challenge. If it’s at all possible it will require a type of bartering of one commodity for another. The only plausible unit of exchange in such circumstances is a currency like gold – cherished not just for its inherent beauty but because its history over the millennia shows that it holds its value in the best and worst of times.