Putin suggests BRICS looking at new global gold-backed reserve currency

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Here are the latest news items and commentary on current economics news, market trends, stocks, investing opportunities, and the precious metals markets. We also cover hedges, derivatives, and obscura. Most of these items are from the “tangibles heavy” contrarian perspective of SurvivalBlog’s Founder and Senior Editor, JWR. Today, we look at the BRICS countries’ latest push toward a gold-backed currency. (See the Precious Metals section.)

Precious Metals:

Putin suggests BRICS looking at new global reserve currency backed by hard assets. Notably, four of the five BRICS countries are major gold producers. (Only India is not in the Top 20 producers list, but India’s populace is famous for loving gold as an investment.) Here is an excerpt from the article, penned by Corrie Kruger:

“To evaluate the advantages for an oil exporter of getting paid in US dollars, consider periodic claims over the past decade that the petrodollar would soon face a challenge from the petro-yuan: oil exports denominated and paid for with Chinese currency.

All buyers of exported oil hold or can easily access US dollars, while only China and mostly Chinese companies hold the Chinese national currency, called the yuan or renminbi. Unlike the US dollar, the renminbi is not a freely convertible currency; its exchange rate against other currencies, including the US dollar, continues to be managed by China’s central bank

A new reserve currency not controlled by any individual country would be more desirable. Meanwhile, BRICS countries should peg their currencies to gold to solve this worldwide problem driven by the US dollar.

There are a number of commentators who believe that roubles have a future; the dollar does not. The persistent printing of more dollars renders the dollar to be systematically destroyed. And with it, the future of the US is being rapidly eroded by the day, ultimately leaving the American people impoverished.”

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Capital.com Silver price forecast for 2022 and beyond: Will the precious metal rebound?

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Dominic Frisby, at MoneyWeek: Gold has been incredibly boring to own – but that’s no bad thing right now.

Economy & Finance:

Brookings: Tracking regulatory changes in the Biden era.

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At Zero Hedge: “One Of The Worst Downturns In Recent History”: Zuck Warns Facebook Employees To Brace For Layoffs.

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Larry Summers Says Risk of 2022 Recession Climbing, May Damp Inflation.

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“The Rubicon Has Been Crossed”: The BOJ Now Owns More Than 50% Of All Japanese Bonds.

Commodities:

By way of Whatfinger.com, there’s this: Price shock: California’s gas tax just went up, not down. The article begins:

“Just in time for the Independence Day holiday in California: an increase in the state’s already sky-high gas tax.

The 51-cent tax jumped 3 cents on Friday, just adding to the misery for motorists who are paying upward of $7 a gallon, the highest in the nation, in the Golden State. The Democratic supermajority in the legislature did not quash a regular annual tax increase despite intense lobbying by Republicans.

Friday’s AAA gas tax index lists California’s average price at $6.27 a gallon and a nationwide average of $4.84. California’s gas is more expensive in the summer when it utilizes a “summer blend” to cut down on emissions when the automobile-loving state is at its most active.

Gov. Gavin Newsom (D) has proposed a rebate to motorists in lieu of a tax cut, even though other blue states and President Joe Biden have sought the latter. Newsom and top lawmakers struck a deal to give approximately 23 million residents “ inflation relief ” based on a sliding scale. The funds will arrive next year.”

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Also via Whatfinger: JPMorgan Warns Oil Price about to Triple, Devastate Economy.

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Government Intervention Is Fueling Food Shortages. (A hat tip to H.L., for the link.)

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Russia Now Demands Rubles For Grain As World’s Largest Wheat Exporter.

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Rush toward green energy has left US ‘incredibly’ vulnerable to summer blackouts, expert warns.

Inflation Watch:

Fortune: Is this the end of low interest rates?

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Hot inflation data points to a record-high Social Security cost-of-living adjustment in 2023. Some want to change how increases are measured.

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Meanwhile, in England: Inflation, Interest Rate & Economic Updates: NICs Threshold Set To Rise.

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At Wolf Street: Eurozone Whacked by Runaway Inflation, “Fragmentation” Fears after Years of Negative Interest Rates and Reckless QE. JWR’s Comments: For the Euro, we are witnessing the classic “upright spike”, in inflation. One thing that may keep the US Dollar afloat is its relative strength, versus the deeply-flawed Euro. But in the end, all fiat currencies are doomed. Get yourself tangible.

Forex & Cryptos:

Brookings: The future of the US dollar: Are its days as the world’s dominant currency numbered?

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Euro slides to 20-year low against the dollar as recession fears build. JWR’s Comment: I’ve previously warned of the possibility of EUR-USD parity…

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Over at Currency Thoughts: A Sign Emerges that Supply Constraints May Be Easing, but Investors Remain Bearish.

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I missed seeing this in Fortune, when it was published back in May: A recession could tank the value of the U.S. dollar, Goldman Sachs says.

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In The Washington Post: Bill to grant crypto firms access to Federal Reserve alarms experts.

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KuCoin (KCS) Price Crumbles Following Insolvency Rumors.

Tangibles Investing:

Another from H.L.: Used Car Market Set to Collapse in Next 12-18 Months…

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Crypto Meltdown Claims Rolex and Patek Philippe as Victims.

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At Wolf Street: Housing Bubble Getting Ready to Pop: Pending Sales Plunge in June, Inventory Jumps, Price Reductions Spike amid Holy-Moly Mortgage Rates.

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US postage rates are going up, again. Chris M. at Foreverstampprice.com sent us this news and suggestion:

“Standard One Ounce Forever Stamps will increase in cost from $0.58 to $0.60 this Sunday, July 10. This is a modest 3% increase which is significantly lower than current published and “unpublished” inflation rates. However, all of the various Forever Stamps are also increasing in price, and some of them are a much more significant increase:

    • Additional Ounce Forever Stamp: increases from $0.20 to $0.24 (20% increase)
    • Two Ounce Forever Stamp: increases from $0.78 to $0.84 (8% increase)
    • Three Ounce Forever Stamp: increases from $0.98 to $1.08 (10% increase)
    • Postcard Forever Stamp: increases from $0.40 to $0.44 (10% increase)
    • Global Forever Stamp: increases from $1.30 to $1.40 (8% increase)

It is a good idea to maintain, at a minimum, a one-year supply of Forever Stamps. I also recommend you reevaluate your usage and supply before any USPS price increase. Due to the 20% increase in price for Additional Ounce Forever Stamps, you may want to consider acquiring more than a one-year supply of them at this time.

If keeping track of USPS price increases is not a part of your routine, you can sign up to receive a single email notification 1-2 weeks before any Forever Stamp cost increase.”

Provisos:

SurvivalBlog and its Editors are not paid investment counselors or advisers. Please see our Provisos page for our detailed disclaimers.

News Tips:

Please send your economics and investing news tips to JWR. (Either via e-mail or via our Contact form.) These are often especially relevant because they come from folks who closely watch specific markets. If you spot any news that would be of interest to SurvivalBlog readers, then please send it in. News items from local news outlets that are missed by the news wire services are especially appreciated. And it need not be only about commodities and precious metals. Thanks!



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