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Home > Uncategorized

The Equation the Fed Doesn’t Want to Know

June 6, 2023 by Philip Barton Leave a Comment

Tuesday

From Keith Weiner of Monetary Metals.

Keith is the smartest man in the room – always.

Filed Under: Uncategorized

Did Argentina Just De-Dollarize?

May 16, 2023 by Philip Barton

Tuesday

An excellent article from the desk of Keith Weiner – C.E.O. of Monetary Metals

May 15, 2023/0 Comments/by Monetary Metals
Argentina

Argentina recently made headlines with its announcement that it plans to pay for its imports from China in Yuan. Inevitably, gold commentators jumped to the spurious conclusion that this decision signals another step towards “de-dollarization.”

Let’s be clear: this is not the case.

As much as we oppose the perversities of the US dollar system, and offer a way for individuals and institutions to get on their own personal gold standard, we also debunk clickbait articles that confuse more than they clarify.

We even wrote a field guide on How NOT to Think About Gold to inoculate readers against these catchy, but meaningless, headlines.

How Not to Think About Gold Free GuideThe dollar system is fatally flawed, and on shaky ground (see First Republic Bank’s failure as the most recent example), but that does not mean it will crash tomorrow. In the same way that California won’t be drifting into the Pacific Ocean tomorrow morning, despite its history of earthquakes.

We need to discuss actual solutions, not misleading articles.

Before we start, we should note that the headlines say that Argentina “plans” to do this.

We also “plan” to have Brent Johnson wear this outfit for his next Gold Exchange appearance.

But that does not mean he is going to wear it!

The Unpopular Truth

The truth is that Argentina wants to pay in Yuan to slow the outflow of its dollar reserves. Since all currencies are dollar derivatives, losing your dollar reserves is akin to gutting the value of your currency. Argentina is not attempting to de-dollarize, they are in fact desperately trying to hold on to their dollars by paying in any other currency they can. This story is spun as a good thing for Argentina, and as threat to the dollar. When in reality, the dollar is holding. It is Argentina’s currency that is suffering.

But what if….

But what if this plan actually happens? What if Argentina does start to pay for imports with Yuan.

What happens then?

Absolutely nothing.

If a homeowner hires a neighborhood kid to mow their lawn in exchange for a box of ice cream sandwiches, the value of the service provided is not determined in ice cream sandwiches. The same goes for the yuan!

Everyone can see that the price of lawn-mowing service is not 12 ice cream sandwiches. The ice cream sandwich has not suddenly taken on any monetary characteristics. It is not a new unit of account. It is not a threat to dollar hegemony.

Swap out ice cream sandwiches for yuan (or ruble) and you can see why the reserve currency status of the dollar is not affected in the slightest.

The value of the service offered by the kid is determined in the prevailing market for labor, which is denominated in dollars. Similarly, the value of Chinese exports is determined in global markets, which use the dollar as their numeraire.

China can ask for payment in any commodity or currency it chooses, but in the end, it will
receive the dollar value of its imports. It’s a dollar world, and we’re all living in it.*

*Some of us are opting out.

The Only Hope for Argentina

Now what if Argentina actually wanted to switch to an honest monetary system, get out of debt
at a discount, and de-dollarize without destroying its currency?

Something that isn’t another gold price-fixing scheme like the “any minute now” gold-backed
ruble?

There is in fact a way to move forward to the gold standard.

And it’s gaining in popularity.

In the meantime, please take claims of supposed “de-dollarization” and soon-to-be-implemented “gold-backed currencies” with a rock of salt. And read our free field guide to learn how to spot other nothing-burgers masquerading as something-burgers.

Ciao!

Additional Resources for Earning Interest on Gold

If you’d like to learn more about how to earn interest on gold with Monetary Metals, check out the following resources:

The New Way to Hold Gold

The New Way to Hold Gold

In this paper we look at how conventional gold holdings stack up to Monetary Metals Investments, which offer a Yield on Gold, Paid in Gold®. We compare retail coins, vault storage, the popular ETF – GLD, and mining stocks against Monetary Metals’ True Gold Leases.

 

 

Case for Gold Yield in Investment Portfolios

The Case for Gold Yield in Investment Portfolios

Adding gold to a diversified portfolio of assets reduces volatility and increases returns. But how much and what about the ongoing costs? What changes when gold pays a yield? This paper answers those questions using data going back to 1972.

 

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Filed Under: Uncategorized

An Interview With Keith Weiner

May 9, 2023 by Philip Barton

Tuesday

Some interesting takes by the C.E.O. of Monetary Metals on the once and future role of gold.

Filed Under: Uncategorized

Keith Weiner on De-Dollarization & Why the Dollar Isn’t Going Away

April 22, 2023 by Philip Barton

Saturday

Filed Under: Uncategorized

Arkansas Passes Legal Tender Act, Removes Taxes on Gold and Silver

April 19, 2023 by Philip Barton

Thursday

Another small step on a long journey back from the brink.

From Headline USA…

‘The exchange of one type or form of legal tender for another type or form of legal tender shall not give rise to any tax liability…’

By Editor 1
April 18, 2023
school choice Ark. Sanders
Arkansas Gov. Sarah Huckabee Sanders signs into law an education overhaul bill. / PHOTO: AP

(Sound Money Defense League) Sound-money advocates are rejoicing as House Bill 1718, the Arkansas Legal Tender Act has become the law in the Natural State.

Backed by the Sound Money Defense League, Money Metals Exchange, and sound-money advocates and supporters throughout the state, HB 1718 reaffirms gold and silver as legal tender, as well as ends all taxes on purchase, sale or exchange of specie, including state capital-gains taxes.

Read it all HERE

 

Filed Under: Uncategorized

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