The G8 members are not just bumping heads with Russia, but also risk taking on the economic might of China and other Shanghai Cooperative Organization members.
Russia is a founding member of the SCO which brings the real possibility of Russia using gold as an economic weapon against the West, because most governments involved with the SCO have been actively buying gold while the nincompoops in western central banks have been selling it, in what appears to be a brainless, reckless daring attempt to buy more useless paper fiat currency.
Indeed the SCO members have been rather content to accumulate gold on falling prices, being careful not to disrupt the market.
I cannot say for certain that the Crimean crisis is over. I do not think that the Russians will happy until there is a Pro Russian government in Kiev. And if a high flying Russian politician decides to have another chat with the Chinese over creating turmoil on Wall Street, driving up the gold price is the obvious financial weapon of choice.
Just the other day I was reading a fascinating article on the BBC news website, from Robert Peston the business editor , which demonstrated how much the US is vulnerable to the Chinese and Russians attacks to the US capital markets.
The BBC’s business editor wrote about his interview with Hank Paulson, who was the US treasury secretary at the time of the Lehman crisis. Paulson said that he was told by the Chinese that they had a message from the Russians suggesting they club together to drive down the prices of Fannie and Freddie “to maximise the turmoil on Wall Street”. The Chinese declined, but in doing so they made sure the Treasury was aware that China and Russia know that between them they have the power to break western capital markets.
This further show why I believe that’s it’s imperative that people should start to make decision to invest in gold and silver, after all it takes out of the equation counter party risk, i.e. cataclysmic banking failures.
Central bank gold is a reserve of safety, providing “fairly good protection against fluctuations of the dollar and risk diversification,” according to President of the European Central Bank, Mario Draghi, responding to a question from Tekoa Da Silva.
“Central banks which had started a program of selling gold a few years ago, substantially stopped – by and large they are not selling any longer. Also the experience of some central banks that have liquidated the whole stock about ten years ago was not considered to be terribly successful from a purely money viewpoint.”
In the name of the Silver & Gold amen.