As The World Economic Order Unravels, Calls For A return Of The Gold Standard

Return Of The Gold Standard As World Order Unravels -- The Telegraph

As the twin pillars of international monetary system threaten to come tumbling down in unison, gold has reclaimed its ancient status as the anchor of stability. The spot price surged to an all-time high of $1,594 an ounce in London, lifting silver to $39 in its train.

On one side of the Atlantic, the eurozone debt crisis has spread to the countries that may be too big to save - Spain and Italy - though RBS thinks a €3.5 trillion rescue fund would ensure survival of Europe's currency union.

On the other side, the recovery has sputtered out and the printing presses are being oiled again. Brinkmanship between the Congress and the White House over the US debt ceiling has compelled Moody's to warn of a "very small but rising risk" that the world's paramount power may default within two weeks. "The unthinkable is now thinkable," said Ross Norman, director of thebulliondesk.com.

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My Comment: A €3.5 trillion rescue fund to ensure the survival of Europe's currency union .... yeah right .... I have trouble seeing countries like Germany willing to sacrifice even more in order to give a break to the dead-beats in Greece and elsewhere. In the end ... maintaining all of debt is not sustainable .... hence everyone is now looking for safe havens and gold (for the moment) is providing it.

Russia Backs Return To Gold Standard To Solve Financial Crisis

From The Telegraph:

Russia has become the first major country to call for a partial restoration of the Gold Standard to uphold discipline in the world financial system.

Arkady Dvorkevich, the Kremlin's chief economic adviser, said Russia would favour the inclusion of gold bullion in the basket-weighting of a new world currency based on Special Drawing Rights issued by the International Monetary Fund.

Chinese and Russian leaders both plan to open debate on an SDR-based reserve currency as an alternative to the US dollar at the G20 summit in London this week, although the world may not yet be ready for such a radical proposal.

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My Comment: Unlike most Western countries, the Russian Government understands the importance of gold, and how it can be used to instill discipline in a countries financial and currency situation.

Kudos to the Russian Government, they are showing far more common sense than our own governments. I predict China, the Gulf States, and other major countries to soon follow. These actions will have a long term profound impact on both world economics and business.