“Gold has worked down from Alexander’s time. When something holds good for two thousand years I do not believe it can be so because of prejudice or mistaken theory.”
Bernard M. Baruch
I thought this was interesting, particularly given the source of the interview at Bloomberg News.
It is short and so a little bit of a light touch perhaps, but a nice overview nonetheless.
One little point of fact I would raise is that the comparison of China M2 and the US M2 is not the whole story. Since China is not a particularly international currency their M2 is probably a significant subset of their overall issuance.
But in the case of the US, M2 does not account for ‘eurodollars’, which the Fed intentionally stopped tracking some years ago ‘to save money’ and thereby stopped issuing M3 figures. This is a significant factor for the world’s reserve currency as you might imagine, and a glaring omission in the validityof the comparison.
A key factor would be their price peg mechanism vis a vis the dollar, and any redeemability features.
They must approach this carefully, because the Anglo-American Banks and Funds will be …
Click through for the rest.