A 'Copper Standard' for the world's currency system?

A 'Copper Standard' for the world's currency system?

www.telegraph.co. uk

China's State Reserves Bureau (SRB) has instead been buying copper and other industrial metals over recent months on a scale that appears to go beyond the usual rebuilding of stocks for commercial reasons.

Nobu Su, head of Taiwan's TMT group, which ships commodities to China, said Beijing is trying to extricate itself from dollar dependency as fast as it can.

(visit the link for the full news article)

Mod Edit: Review This Link: Instructions for the Breaking News Forums: Copy The Exact Headline

[edit on 4/18/2009 by semperfortis]

"China has woken up. The West is a black hole with all this money being printed. The Chinese are buying raw materials because it is a much better way to use their $1.9 trillion of reserves. They get ten times the impact, and can cover their infrastructure for 50 years."

"The next industrial revolution is going to be led by hybrid cars, and that needs copper. You can see the subtle way that China is moving into 30 or 40 countries with resources," he said.

The SRB has also been accumulating aluminium, zinc, nickel, and rarer metals such as titanium, indium (thin-film technology), rhodium (catalytic converters) and praseodymium (glass).

While it makes sense for China to take advantage of last year's commodity crash to restock cheaply, there is clearly more behind the move. "They are definitely buying metals to diversify out of US Treasuries and dollar holdings," said Jim Lennon, head of commodities at Macquarie Bank.

John Reade, metals chief at UBS, said Beijing may have a made strategic decision to stockpile metal as an alternative to foreign bonds. "We're very surprised by Chinese demand. They are buying much more copper than they will need this year. If this is strategic, there may be no effective limit on the purchases as China's pockets are deep."

Zhou Xiaochuan, the central bank governor, piqued the interest of metal buffs last month by calling for a world currency modelled on the "Bancor", floated by John Maynard Keynes at Bretton Woods in 1944.

The Bancor was to be anchored on 30 commodities - a broader base than the Gold Standard, which had caused so much grief in the 1930s. Mr Zhou said such a currency would prevent the sort of "credit-based" excess that has brought the global finance to its knees.

................................................

... Let the hoarding of metals begin...

www.telegraph.co. uk
(visit the link for the full news article)

Mod Edit: Review This Link: Instructions for the Breaking News Forums: Copy The Exact Headline

[edit on 4/18/2009 by semperfortis]

I've been expecting this to happen. Makes all kinds of sense.When the dollar begins to hyper-inflate the cost of metals from the U.S. will cost China dearly. Really a smooth business move if you think about it.

China woke up for sure. Epiphany.

Well this has lowered my expectations for a quick economy fix.

Wonder what happens now. I'm waiting for those nifty Five million dollar bills to start printing, but there so inflated that you can maybe get a can of beans with it.

Star 4 U!

Nice observation...

I've been following China's hoarding of Natural Resources for months now...

Their latest and greatest conquest could be Rio Tinto...

Rio has equipment and operations world-wide...

If they end up with this, they would control MAJOR markets and resources...

Australia is having second thoughts about the deal now, as well they should, but, backing out now would incur quite a big fee...

Even if they never mined another ounce of Copper, they'd have all the Copper they already hoarded and all the equipment used to mine it in the future...

[edit on 4/17/2009 by Hx3_1963]

interesting that roths clids got out of the gold trade in 2004 [url=http://findarticles.com/p/articles/mi_qn4158/is_20040415/ai_n12777519/]http://findarticles.com/p/articles/mi_qn4158/is_20040415/ai_n12777519/[/ur l]

and they basically set up rio tinto up and own 30 percent in the early years and basically advised them ever since im not trying to change the topic to rothschild but thought id kick it in