India Sells Off The American Dollar, Buys Gold

Proof • November 4, 2009

A smart move on their part, and a sad commentary on the state of the US dollar as an international reserve currency. More and more, countries are voting on America’s economic future with their feet.

Gold prices continued to rise on Wednesday extending the all-time highs which followed India’s central bank bought 200 tonnes of the precious metal, swapping dollars for bullion as the country’s finance minister warned the economies of the US and Europe had “collapsed”.
India’s decision to exchange $6.7bn for gold equivalent to 8 per cent of world annual mine production sent the strongest signal yet that Asian countries were moving away from the US currency.
The purchase by New Delhi’s Reserve Bank from the International Monetary Fund pushed gold prices to a record $1,090.90 per troy ounce, up 2.6 per cent on the day, as traders bet that other central banks would also become buyers.
Pranab Mukherjee, India’s finance minister, said the acquisition reflected the power of an economy that laid claim to the fifth-largest global foreign reserves: “We have money to buy gold. We have enough foreign exchange reserves.”

Does anyone think this would be happening if America were plunging to new levels of debt and deficit?
Of course it wouldn’t be.
Hope and change!

Tags: Asshats, Domestic Issues, Politics

http://fu.com/ robert108

Good catch, Rob! This is just the beginning of the damage Obama’s insane spending has done to our economy, and will continue to do until we return to fiscal conservatism: living within our means.
http://www.bikebubba.blogspot.com/ bikebubba

Fly, I’d recommend something different than .22, but you are correct to suggest that copper clad lead, brass, and ordinance steel are as precious of a metal as gold or silver.
bullwinkle59

In January 2008, 28 years after the all-time record high of price of $850 in January 1980, the nominal broke the record. In inflation adjusted US dollars, the price would have to reach about $2,200 to break the record in real terms.

http://www.finfacts.com/Private/curency/goldmarketprice.htm
sayanything-2361

“…or at least a backup if the Fed does manage a “Weimar event.” ”

You mean like collecting 22 rifles and bricks of ammo whenever it’s convenient? They could be worth more than their weight in gold.
bullwinkle59

The purchase by New Delhiâ€™s Reserve Bank from the International Monetary Fund pushed gold prices to a record $1,090.90 per troy ounce, up 2.6 per cent on the day, as traders bet that other central banks would also become buyers.

All time high?

NOT ADJUSTED FOR INFLATION.
Barely over 50%.

Another gold myth. India is as idiotic as any other moron out there buying gold at today’s prices.

http://goldprice.org/inflation-adjusted-gold-price.html
$2176 in 1980 = $2200+ today. Gold is trading at $1089.

Look at the chart. It says it all about India and anyone else who thinks gold is at an all-time high. Anyone who thinks gold is a good hedge against inflation is a fool (unless losing nearly 50% is good).
metakid

Thought it was interesting how some are thinking gold is the new international currency. http://www.newsy.com/videos/wall_street_s_gold_rush. So do you’ll think that gold has run its course?
sayanything-2361

Just my opinion, but .22 is cheap allowing lots of practice and only slightly less effective. People don’t like to leak, though I agree it’s underpowered for some of the hairier situations.
bikebubba

Time to get a real money standard…..or at least a backup if the Fed does manage a “Weimar event.”
sayanything-2361

“Does anyone think this would be happening if America were plunging to new levels of debt and deficit?”
And printing money like the ink was free. Please don’t forget that important point as more elections loom. Debt, deficit and inflation are the gifts that keep giving to the poor and middle class for generations.
http://usb3gvn.com/ USB 3G

Well, interesting post, thanks!

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India Sells Off The American Dollar, Buys Gold

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