# China sees new world order with oil benchmark backed by gold



## BillS (May 30, 2011)

https://asia.nikkei.com/Markets/Com...world-order-with-oil-benchmark-backed-by-gold

China sees new world order with oil benchmark backed by gold

Yuan-denominated contract will let exporters circumvent US dollar

DENPASAR, Indonesia -- China is expected shortly to launch a crude oil futures contract priced in yuan and convertible into gold in what analysts say could be a game-changer for the industry.

The contract could become the most important Asia-based crude oil benchmark, given that China is the world's biggest oil importer. Crude oil is usually priced in relation to Brent or West Texas Intermediate futures, both denominated in U.S. dollars.

China's move will allow exporters such as Russia and Iran to circumvent U.S. sanctions by trading in yuan. To further entice trade, China says the yuan will be fully convertible into gold on exchanges in Shanghai and Hong Kong.

"The rules of the global oil game may begin to change enormously," said Luke Gromen, founder of U.S.-based macroeconomic research company FFTT.

The Shanghai International Energy Exchange has started to train potential users and is carrying out systems tests following substantial preparations in June and July. This will be China's first commodities futures contract open to foreign companies such as investment funds, trading houses and petroleum companies.

Most of China's crude imports, which averaged around 7.6 million barrels a day in 2016, are bought on long-term contracts between China's major oil companies and foreign national oil companies. Deals also take place between Chinese majors and independent Chinese refiners, and between foreign oil majors and global trading companies.

Alan Bannister, Asia director of S&P Global Platts, an energy information provider, said that the active involvement of Chinese independent refiners over the last few years "has created a more diverse marketplace of participants domestically in China, creating an environment in which a crude futures contract is more likely to succeed."

China has long wanted to reduce the dominance of the U.S. dollar in the commodities markets. Yuan-denominated gold futures have been traded on the Shanghai Gold Exchange since April 2016, and the exchange is planning to launch the product in Budapest later this year.

Yuan-denominated gold contracts were also launched in Hong Kong in July -- after two unsuccessful earlier attempts -- as China seeks to internationalize its currency. The contracts have been moderately successful.

The existence of yuan-backed oil and gold futures means that users will have the option of being paid in physical gold, said Alasdair Macleod, head of research at Goldmoney, a gold-based financial services company based in Toronto. "It is a mechanism which is likely to appeal to oil producers that prefer to avoid using dollars, and are not ready to accept that being paid in yuan for oil sales to China is a good idea either," Macleod said.

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It's a game changer because countries won't have to stockpile dollars in order to buy oil. The federal government funds its trillion dollar deficit with printed money. The dollars that other countries hold are subject to inflation and a loss of purchasing power. They're tired of, in effect, funding our deficits with their inflation.

The king of Saudi Arabia will visit Russia in October. I wonder if that will lead to an announcement that Saudi Arabia will accept Chinese yuan and/or Russian rubles for sales of Saudi oil in exchange for them being their new protectors.

It's going to get interesting. We could see a devaluation of the dollar soon. We could wake up on a Monday morning and find out that our dollars are now worth half of what they used to be worth. If you have the money, now is a good time to buy gold and silver.


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## bkt (Oct 10, 2008)

When the world no longer needs US dollars to buy oil, the world will be flooded with unwanted dollars. That's when things get really interesting for folks who are paid in US dollars.

Also interesting is Venezuela announced it is about to ditch the US dollar.


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## VoorTrekker (Oct 7, 2012)

Our imperialism is coming to an end. Perhaps we can guide the spiraling crash toward a free enterprise republic again.

Ghadaffi of Libya was establishing an African common currency based on gold instead of U.S. "dollars," Saddam Hussein converted to Euros and dropped the petrodollar, so our Lords and Masters the "Banks" (banksters) sent our youth to fight their wars.

1892 Congress borrowed money on credit of these united States and pledged the nation and the people as collateral. They defaulted on the debt and the bankers foreclosed. The Banksters established two corporations: The "United States of America" and the Supreme Court. These were international foreign banks and foreign governments with a few Americans involved.

The Union of Republican States of North America a.k.a. these united States ceased to exist. Article 1 USC states Congress can establish a _supreme_ Court. The *Supreme* Court is a bankruptcy liquidation corporation court. The States of the Union followed suit by signing on to the Buck Acts of 1940 making a Commonwealth of "XXX" into "State of XXX." The States became bankruptcy liquidation corporations.

The banks established the Federal Reserve Bank, the 16th and 17th Amendments and the Buck Acts, as well as the Interstate Intrastate Compacts. Now all land property is real estate, conveyances became vehicles and the people are assets. 
Without the land title/land patent the land is leased through a deed. Certificate of Title for a conveyance is a lease deed for a vehicle. A Social Security number is a people registration certificate.

Afterward we fought the Spanish American War, WWI, WWII, Viet Nam, Desert Storm and OIF for the international bankers using their Federal Reserve Notes "U.S. Dollars."

Our Imperialism began with the Spanish American War and will end with another major Middle East campaign. Our Bankster "government" has crushed all international opposition to being owned by the "U.S." and the Bank.

Now the world has an ally against those Yankee Imperialists through Russia, China and Brazil. Our Congress, the Deep State and the Progressives will usher in our destruction until we may very well be a smoldering heap by way of strategic warfare.

China has remote alternate cities, Russia has a 40,000,000 people nuclear shelters program and America has FEMA and the Red Cross.

When will we become weary of these Bankster Wars where our sons and daughters die for their cause and we get tossed in the dumpsters or under the bus?


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## power (May 7, 2011)

The U.S. is in the same position of anyone who continues to borrow money with no way of paying it back. Just like in your personal life, there will come a day when the U.S. cannot find anyone to loan them the money they need. Right now we cannot pay the interest on what we have already borrowed.

One day the U.S. will have to decide what to do. Either give our country to the lenders or tell them the U.S. is not going to pay the loan or the interest.
Which way do you think our leaders will choose?


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## bkt (Oct 10, 2008)

power said:


> The U.S. is in the same position of anyone who continues to borrow money with no way of paying it back. Just like in your personal life, there will come a day when the U.S. cannot find anyone to loan them the money they need. Right now we cannot pay the interest on what we have already borrowed.


Goodness, it's much worse than that. Yes, we certainly are in debt. But should our dollars lose Reserve Currency status, everyone will be flooded with unwanted dollars...and we'll still be in debt.



power said:


> One day the U.S. will have to decide what to do. Either give our country to the lenders or tell them the U.S. is not going to pay the loan or the interest.
> Which way do you think our leaders will choose?


Ultimately, we will default. What it'll look like is anyone's guess. But it's pretty certain war will be involved.


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## power (May 7, 2011)

We will soon lose Reserve Currency status anyway. 
The U.S. is printing money as fast as the presses will run. 
Some of our elected officials will come up with the idea that we can print our way out of debt. We will start printing larger denomination bills. We are already printing them for banking use right now. We will just print out a bunch and pay back the people who loaned us the money. That will be when the trouble starts.


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## BillS (May 30, 2011)

It's going to get really ugly once the rest of the world refuses to accept dollars. America doesn't really make stuff anymore. It assembles things from foreign made parts. US car production will stop. Foreign cars will get much more expensive as the dollar loses value.


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## power (May 7, 2011)

The U.S. has slowly gotten rid of much of the gold they had. Quite a bit of gold was given to Iran when Obama sent them the plane load of money.


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## RedBeard (May 8, 2017)

The great depression will look like a party compared to whats coming if this happens.


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## VoorTrekker (Oct 7, 2012)

power said:


> ...One day the U.S. will have to decide what to do. Either give our country to the lenders or tell them the U.S. is not going to pay the loan or the interest.
> Which way do you think our leaders will choose?...


See my above post #4, they already made that decision in 1892.


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