It would appear that the Chines economy is going sufficiently well considering they look like they can hold on to all their new apartments, shopping centres and even empty cities plus US $1.2 trillion in dodgy US bonds and still manage to pick a little Gold!
The temptation to dump some of those bonds given the current situation in Washington must be overwhelming particularly when real money and wealth preservation (Gold) can be purchased at current prices.
“Chinese Gold demand on track to hit 1,000 Tonnes: WGC”
By the way how come no one ever can answer me this simple question? Presumably when Jonny Howard sold Australia’s Gold he needed the dollar proceeds from the Gold. Why not just retain the Gold and print up the equivalent amount of dollars?
When Ben Bernanke prints up the money these days the US citizens get US bonds with little interest and dodgy mortgage paper that will never be converted to anything of any value.
Had John Howard retained the Gold as a reserve and printed the money the Australian citizens may have had a little inflation caused by the additional printing. (Although apparently this never actually happens.) However, we would still own the Gold and have enjoyed the price growth from 1998 to today. Howard and Costello rather than look like idiots would look like geniuses.
Of course I know these guys aren’t fools but until we get some kind of free thinking member of the media to start asking these type of questions we will never find out the thinking behind these decisions.
Personally I still think it was string pulling from Washington the source of Australia’s foreign policy! However; I am more than happy to hear other reasonable suggestions but won’t hold my breath until I get one.
