If China really starts facilitating an oil trade in yuan that are quickly convertible to gold in Shanghai, Hugo Salinas Price writes today, oil sellers will not be the only ones interested in such transactions. As the gold price rises from increased demand in the oil trade, Salinas Price writes, other sellers of commodities probably will start wanting gold in exchange as well.
Salinas Price, president of the Mexican Civic Association for Silver, concludes: "The implications I see for the Chinese move are vast. We may witness the return of the gold standard not as we had imagined but simply as the result of a spontaneous turn to gold as a means of trade initiated by the Chinese measure."
Indeed, gold is so scarce relative to official government currencies that even smaller countries with substantial foreign-exchange surpluses could crash the U.S. dollar, the world reserve currency, and all the major government currencies simply by acquiring a large amount of physical gold, renouncing "paper gold."
This has been true for a long time but no country has had the inclination to try to bring down the financial order of Western imperialism. Perhaps such a risk can be taken only by a nation that possesses a nuclear deterrent.
Salinas Price's commentary is brilliantly headlined "The Gold Worm on the Yuan Hook" and it's posted at the association's internet site, Plata.com, here:
http://www.plata.com.mx/mplata/articulos/arti...idarticulo=3...
