November 2, 2013
bundesbank, euro, German, gold, John Butler, remonitise
Interesting interview with John Butler over the future and eventual re-monetization of Gold. Butler claims there is a massive financial earthquake to come with paper currencies are repudiated. 2008 was only a fore-shock.
The German Bundesbank under the Constitution can go to court if it feels the German currency (i.e euro) is under threat from the ECB. In that case the markets would immediately react negatively and the “shit would hit the fan”. In other words, the future of the euro may well be in the German Bundesbank’s hands.
May 30, 2012
capital account, china, dollar, gold, japan, John Butler, oil
John Butler gave an interview on Capital Account, these are the main points.
- Regulators have dictated capital controls and gold is not a Tier 1 asset.
- Banks sell their positions in paper gold to raise capital.
- Leveraged gold positions need to be cleared.
- The smoke will eventually clear and when capital restraints are relaxed, gold will take off.
- Banks at the moment, must stop lending and increase capital.
- The stresses in the banking system are similar to 2008 and policy makers to react so JB sees gold rally in same way.
- Banks are looking for Tier 1 assets to include gold but its unlikely regulators would include gold because regulators know banks would choose gold over bonds.
- Gold is now being used as collateral and as money.
On the Dollar
- Japan and China to trade in each others currencies is unprecedented. They are very large economies and will mean less dollars been accumulated by them in the future.
- This is a major step away from the dollar and very significant.
- Other countries are edging away from the dollar including Iran selling oil for anything other than dollars.
- BRICS don’t like US policy with Iran.
- Eventually US will have to blockade Iran or risk a large shift away from the dollar.
- World economy is now multi-polar in which US monetary hegemony doesn’t exist anymore and so gold will be used in some part as a world reserve currency because it can’t be manipulated.