Cina mata sepet, comel sekali !!!
Kita suka panggil Cina si mata sepet, sebab faktor keturunan dan keadaan asal geografi tanah lahir mereka menyebabkan mereka bermata sepet...walaupun mata sepet, tapi pandangan mereka luas...kenapa? Saksikan sedutan video di bawah!
Worried about
the value of its Dollar reserves, China has turned to Buying Gold...
FOR OVER three decades, since the start of the
country's "Reform Era" in 1978, China has been exporting more goods
than it has imported, writes Porter Stansberry in the Daily
Wealth.
That's
allowed the nation to stockpile trillions of Dollars – more money than our
entire monetary base totaled before the recent financial crisis.
The
way it works is simple to understand. When a Chinese business earns Dollars by
selling overseas, the law requires the company to hand those Dollars over to
the country's central bank, the People's Bank of China (PBOC). In return, the
business gets Chinese currency (called either the "Yuan" or the
"Renminbi") at a fixed rate.
There's
nothing fair about this. The Chinese people do all the work, and the Chinese
government keeps all of the money. But that's the way it goes.
As
I mentioned yesterday, the group in China that manages these foreign reserves
is called the State Administration of Foreign Exchange (SAFE). This group is
engaged in a full-fledged currency war with the United States. The ultimate
goal – as the Chinese have publicly stated – is to create a new dominant world
currency and dislodge the US Dollar from its current reserve role.
And
for the past few years, SAFE has had one big problem: What to do with so much
money?
SAFE
decided to use most of these reserves to buy US government securities. As a
result, the Chinese have now accumulated a massive pile of US government debt.
In fact, about two-thirds of China's reserves remain invested in US Treasury
bills, notes, and bonds. The next biggest chunk is in Euro. Of course, all this
money is basically earning nothing to speak of in terms of interest...because
interest rates around the world are close to zero.
And
while the Chinese would love to diversify and ditch a significant portion of
their US Dollar holdings, they are essentially stuck. You see, if the Chinese
start selling large amounts of their US government bonds, it would push the
value of those bonds (and their remaining holdings) way down. It would be like
owning 10 houses on the same block in your neighborhood...and deciding to put
five of them up for sale at the same time. Imagine how much that would depress
the value of all the properties with so much for sale at one time.
One
thing China tried to do in recent years was speculate in the US stock market.
But that did not go well...The Chinese government bought large amounts of US
equities just before the market began to crash in late 2007. It purchased a
nearly 10% stake in the Blackstone Group (an investment firm)...and a similar
stake in Morgan Stanley. Blackstone's shares are down about 46% since the
middle of 2007, and Morgan Stanley is down about 70% since the Chinese
purchase.
The
Chinese authorities got burned big time by the US equities markets and received
a lot of heat back home. They are not eager to return to the US stock market in
a meaningful way. So China's US Dollar reserves just keep piling up in various
forms of fixed income – US Treasury bonds, Fannie and Freddie mortgage bonds,
and other forms of debt backed by the US government. These investments are
considered totally safe – except that they're subject to the risk of inflation.
According
to a statement by the government: "SAFE will never be a speculator. It
mainly seeks to protect the safety of China's foreign exchange reserves and
ensure a stable investment return."
If
the Chinese won't buy stocks and the only real risk to their existing portfolio
is inflation, what do you think they will do to hedge that risk? They
will Buy Gold...lots and lots of gold.
The
Chinese are now clearly on a path to accumulate so much gold that one day soon,
they will be able to restore the convertibility of their currency into a
precious metal...just as they were able to do a century ago when the country
was on the silver standard.
The
West wasn't kind to China back then. The country was repeatedly looted and
humiliated by Russia, Japan, Britain, and the United States. But today, it is a
different story...
Now,
China is the fastest-growing country on Earth, with the largest cash reserves
on the planet. And as befits a first-rate power, China's currency is on the
path to being backed by gold.
China
desperately wants to return to its status as one of the world's great
powers...with one of the world's great currencies. And China knows that in this
day and age – when nearly all governments around the globe are printing massive
amounts of currency backed by nothing but an empty promise – it can gain a huge
advantage by backing its currency with a precious metal.
As
the great financial historian Richard Russell wrote recently: "China wants
the Renminbi to be backed with a huge percentage of gold, thereby making the
Renminbi the world's best and most trusted currency."
I
know this will all sound crazy to most folks. But most folks don't understand
gold, or why it represents real, timeless wealth. The Chinese do.
Porter Stansberry, 23 Feb '12 Daily Wealth
Buying Gold for your own private
reserves?
Call 010 243 9004
