https://www.gold-eagle.com/article/commodity-currency-revolution
The Commodity Currency Revolution
Alasdair Macleod
Author & Head of Research @ Goldmoney
April 7, 2022
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We will look back at current events and realise that they marked the change from a dollar-based global economy underwritten by financial assets to commodity-backed currencies. We face a change from collateral being purely financial in nature to becoming commodity based. It is collateral that underwrites the whole financial system.
The ending of the financially based system is being hastened by geopolitical developments. The West is desperately trying to sanction Russia into economic submission, but is only succeeding in driving up energy, commodity, and food prices against itself. Central banks will have no option but to inflate their currencies to pay for it all. Russia is linking the rouble to commodity prices through a moving gold peg instead, and China has already demonstrated an understanding of the West’s inflationary game by having stockpiled commodities and essential grains for the last two years and allowed her currency to rise against the dollar.China and Russia are not going down the path of the West’s inflating currencies. Instead, they are moving towards a sounder money strategy with the prospect of stable interest rates and prices while the West accelerates in the opposite direction.
The Credit Suisse analyst, Zoltan Pozsar, calls it Bretton Woods III. This article looks at how it is likely to play out, concluding that the dollar and Western currencies, not the rouble, will have the greatest difficulty dealing with the end of fifty years of economic financialisation.
Pure finance is being replaced with commodity finance
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We’ve seen the price of gold in dollars rise. ₿itcoin is another example of the little people seeking to save in the face of massive inflation. And, those ₿itcoiners who are holding on for dear life (aka HODLers) are obviously big winners and just don’t let go.
Some Gooferment just levied a 42% tax on ₿itcoin capital gains. Good luck collecting that. That’s why self-custody is almost mandatory. I can see generations of family practicing tax evasion and avoidance as wealth is transferred inter-generationally by means of ₿itcoin, precious metal “coins” (i.e., rounds), and other hard invisible assets.
For the “tiny savers”, for whom the price of gold and silver is too big a barrier to entry, ₿itcoin and Goldbacks are low cost ways to enter the market.
Not every seismic change happens quickly like a Tsunami, Earthquake, or Hurricane. But like small tremors lead up to a big quake, this is happening right before us.
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Reinke Faces Life 