Revenge

Following up on last weekends musing on the possibility of China regarding the US printing money as a de facto default. This article in the FT makes it pretty clear that is exactly what is happening:

China has quietly almost doubled its gold reserves to become the world’s fifth-biggest holder of the precious metal, it emerged on Friday, in a move that signals the revival of bullion after years of fading importance.

In an earlier version of the article, now edited away, was this quote:

Hou Huimin, vice general secretary of the China Gold Association, said China should build its reserves to 5,000 tonnes. “It’s not a matter of a few hundred, or 1,000 tonnes. China should hold more because of its new international status, and because of the financial crisis,” he said. “The financial crisis means the US dollar’s value is changing fast, and it may retreat from being the international reserve currency. If that happens, whoever holds gold will be at an advantage.”

Not much doubt about that then. Rather odd that the quote was edited out.

In other news, Alistair Darling is now my favourite comedian. Managing in his budget to say that the current down turn is serious as the Great Depression, and that the growth resuming by Christmas, is one of the funniest things i think i’ve ever heard a politician say… well, except maybe for that Hatoyama idiot and “his friend in Al-Qaeda”.

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Wise words...

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