We have been following a plethora of “nails” that have been hammered into
the coffin of the Federal Reserve Note, U.S. dollar. Over the past several
years China has made serious challenges to the world reserve currency system
of global trade settlement. China has created direct currency swaps with more
than 25 nations around the world and back in October 2017 launched the oil
futures contract priced in yuan/renminbi, the Chinese national currency. This
presents major challenges to the Federal Reserve Note, U.S. dollar world
reserve currency.
Today we learned that China is unleashing another direct challenge to the
dollar hegemony as they prepare to launch a yuan-backed metals futures on the
London Metals Exchange (LME). This will be a great compliment to the Shanghai
Gold Exchange, which has been very successful over the past several years and
is already priced in yuan/renminbi.
A metals futures contract denominated in Chinese currency may soon be
launched at the London Metal Exchange (LME), according to the exchange chief
executive, Matthew Chamberlain.
“At present, investors are trading our products in US dollars. We
would definitely like to explore the possibility of launching products
denominated in offshore renminbi,” Chamberlain said in an interview with
the South China Morning Post.
The LME, which is owned by Hong Kong Exchanges and Clearing (HKEX),
currently allows traders to use the Chinese currency as collateral. Last
July, the HKEX stock market also launched yuan-denominated gold futures.
LME’s chief executive didn’t specify when the new metals contracts would
start changing hands in London. However, Chamberlain is reportedly confident
that yuan-backed futures contracts are destined for success, as the Chinese
currency is becoming more and more used in global finance.
“Chinese investors are definitely very active customers at the LME.
They are trading through mainland brokers who are members of the LME or
western firms,” he said, as quoted by the media.
“We believe with the increasing number of Chinese trading in our
market, there would be more Chinese companies wishing to join the LME.” Source – RT
The concern I have with this particular situation is the lack of a
timeline. Is this another pure speculative “announcement” similar to the
“gold backed oil contract” that created such a stir throughout most of 2017?
We certainly hope not. The last thing we need is another ghost story
detracting from the serious issues of the day that require our undivided
attention. We are hopeful this will take root and grow into the challenge
that it sounds like it could be.
The gold price suppression scheme, with it’s 40+ year history, has done
enough damage and we need something to change. At this point I don’t know if
the Chinese run system would be an improvement or not, I just know what we
currently have in place is only benefiting the bullion banks, governments and
a handful globalist. I doubt the Chinese would be any better, but there may
be a window of opportunity for the people, the gold/silver bugs, to make a
play while the two systems cross paths.
