China, Not Wall Street, Caused 2008 Crisis: Study

By: Liza Jansen, Special to CNBC.com

 

Thought the global financial crisis in 2008 was caused by subprime bonds, collateralized debt obligations (CDOs) and other Wall Street engineering? Think again.

According to a new study, China, not Wall Street bankers, was responsible for the global crisis and the ensuing recession.

The study from the Erasmus Research Institute of Management said the saving frenzy of the Chinese created the cheap money, which fueled the U.S. housing bubble and its collapse.

Heleen Mees, writer of the study and adjunct associate professor at the NYU Wagner Graduate School of Public Service, said that exotic mortgage products could hardly have been the cause of the U.S. housing market bubble and its ultimate collapse.

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Death by China Documentary Film - Official Trailer

China's Possible Poweplay?

China is accusing the US of defaulting on it's debt...I am actually surprised that it has taken this long for the mainstream media to start picking up these reports and taking them seriously. Our debt is piling up so fast that from what I can see the US has no other option other than to do so.

China who is the largest foreign holder of treasury bills has every right of showing extreme concern. As well, other reports have surfaced stating that China is in the process of dumping these T-Bills.

Anyone can see that the economic power is definitely shifting from the west to the east and this process is happening at a rapid pace. Concerns - Even though we may not be able to pay our debts back to China in the form of cash we have plenty of other options if needed: U.S. land holdings, intellectual property, military secrets or the 300 million potential workforce that resides between the Atlantic and Pacific oceans. Just something to think about.
-Blogging4Bullion

Sources:
China ratings house says US defaulting: report
China remains largest holder of US Treasury securities: report
Is China quietly dumping US Treasuries?

Breaking: China downgrades U.S. Credit Rating

According to the Chinease press, the Chinese rating agency Dagong Global Credit has downgraded the US credit rating due to QE (Quantative Easing) program that was recently put into place.

The Agency cut the long term US sovereign rating one notch to A+ from AA because of negative outlooks. They quoted that this is due to "The serious defects in the U.S. economy will lead to long-term recession and fundamentally lower the national solvency. The credit crisis is far from over in the United States and the U.S. economy will be in a long-term recession."

According to the rating agency the weaker dollar will hurt the United States' ability to attract dollar capital reflow. In essence, the U.S. government's move to devalue the dollar indicates its solvency is on the brink of collapse.

Very bad news indeed for us here in the United States. A currency war is coming with China and things are going to start getting real bad from an economic standpoint. Also, don't just think that the chinese are involved in this little game,Russia I believe is pulling the strings as well. Bank holidays are coming. More to come.

-Blogging4Bullion

Russia on the Move - Buys 16% of Global Gold Production

According to the central bank of Russia, gold reserves were up by 1 million + ounces during the month of May. This by far is the largest single month purchase of the metal in the last 3 years. Global output is roughly 7 million ounces and once you do the math you get about 16% of all total production. That is a lot of gold that the Russians are getting there hands on.

My past posts have also been mentioning China and India as well on these gold buying sprees. Something is definitely up and these super powers on the asian continent are all to aware of it. All signs are pointing to a possible super massive economic collapse on a global scale and the push of a Russian or China currency backed by gold. Stay tuned.

-Blogging4Bullion

On Sale: Gold Slightly Down, Time to Buy In.

Gold was up in the early hours on Monday due to China announcing that they are re-adjusting the value of the yuan. The news was released over the weekend and after the market had time to soak in this information the markets started showing signs of retreating. Gold currently is down just shy of 7% to roughly $1234.80

So is this bad news? Of course not, Gold is temporarily on sale and now is a great time to start buying in. Remember, The trend is your friend and I currently see gold recovering and gaining very soon.

-Blogging4Bullion

U.S. says yuan to appreciate yet China still buying gold

As the title says, The United States and others are calling for the Yuan to appreciate yet the Chinese government is still heavily encouraging gold investments and is currently expanding its range investments in the region. These two signs do not work well hand in hand. Why push gold on the citizens, invest heavily in the metal from a government standpoint if the Yuan is expecting to do well.

Many analysts and strategist will give different reasons on why they are are doing this so who really knows for sure aside from them. My opinion is that China sees the writing on the wall. Global economies are failing and China is trying to be on the ground floor by shoring up their nation with precious precious metals. This plan should help the country weather the current economic crisis as well as the coming super crisis that many are predicting.

Why are we not doing the same?

-Blogging4Bullion

Silver: A love hate relationship

Anyone that has been holding silver for a steady length of time will tell you that they have experienced many emotions throughout their relationship. Some experienced love and joy while others experienced hate and loathing. Some have even experienced mild to moderate depression and will probably need therapy at some point. Hopefully this article will alleviate those that thought silver was their cross to bear.

I love silver, maybe its because I always root for the underdog or the fact I always pull for the guy that is down in out in the movies or maybe it is because I know that at some point it is going to explode sooner rather than later.

Silver actually has made some pretty good gains over the years. January 2005 , the metal was priced at $6.40 roughly. Fast Forward to June 2010 and is happily bouncing between $18-$19. Not to bad is it? especially if you were one of those that invested years earlier. Still not convinced, lets go further shall we.

There is a greater demand for precious metals worldwide obviously because of the global economies. Reports of China consuming massive amounts of silver and will continue to do so for some time. We also know that silver is way undervalued due to market manipulation. All these factors convince me that the shiny metal is going to take off much sooner than ever expected. With that said, hang in there, relationships can be rocky but a little patience may payoff in a big way.

-Blogging4Bullion

China, India Greedy for Gold

Ever-soaring prices for gold did little to dent strong demand for jewelry in China and India during the first quarter as industry experts appeared confident in the yellow metal’s potential for growth throughout the shaky economic terrain of 2010.

“The diversity of demand for gold, both by sector and geography ensures that the outlook for gold remains strong for the remainder of 2010,” said Aram Shishmanian, CEO of the World Gold Council, in a May 26 press release.

“Despite increasing gold prices, consumers in China and India will continue to drive market growth, particularly in jewelry,” he added.

AFPGold prices averaged US$1,109.1 in the first quarter, a 22 percent year on year increase. Prices struck a record high US$1,248.9 in mid-May, when investors ditched the euro to seek the relative safety of gold following Europe’s sovereign debt crisis.

Consumers in both India and China seemed nonplussed by the record high prices.

During the first quarter, Indian consumer demand surged 698 percent to 193.5 tons. Chinese demand was more modest, rising 11 percent to 105.2 tons in the same period of time.

The first four months of the year typically show a spike in demand for gold jewelry in both countries, as the Indian spring wedding season and the Chinese New Year spur consumption.

India is the largest consumer of gold in the world, accounting for 25 percent of total jewelry sold and 19 percent net retail investment demand in 2009.

China is the world’s largest producer of gold and second largest consumer, although its per capita consumption is quite low compared to India.

Gold: China ‘Crazy’ Not to Increase Tiny Reserves

By: John Melloy
Executive Producer, Fast Money

Check your drawers for those old cufflinks and see if you still have Grandma’s old jewelry packed away in the basement because you may actually own more gold than China.

China holds just 1.6 percent of its currency reserves in gold, compared to 70 percent by the U.S. and a 66 percent allocation by Germany, according to Credit Suisse. The Bank of Japan holds just 2.5 percent in bullion, notes the firm.

“There are no safe big-cap currencies,” wrote Andrew Garthwaite, Credit Suisse’s head of global equity strategy in a note to clients. “The real gold price is still 34 percent off its all time high and the behavior of gold is not yet typical of a bubble.”

Read More - China ‘Crazy’ Not to Increase Tiny Gold Reserves - CNBC

Hitting The Five-Week High

NEW YORK (TheStreet) -- Gold prices hit a five-week high Monday as data on Chinese exports buoyed the precious metal.

Gold for February delivery, the most actively traded contract, was surging $15.60 to $1,154.50 an ounce at the Comex division of the New York Mercantile Exchange. The contract has traded as high as $1,163 and as low as $1,139.
Precious metal prices received a boost on blowout export data from China. Exports rose 18% in December with copper imports popping 27%. The news lifted metals across the board.
Full article

China to become world's No. 1 gold consumer - GFMS

SHANGHAI (Reuters) - China looks set to overtake India as the world's largest gold consumer in 2009, with total demand for jewellery and investment forecast at 432 tonnes, a senior official at major metals consultancy GFMS said on Friday.
Full article

China Knows When To Take Advantage

Today's article from the Washington Post explains how China is going to take advantage of the Dubai issue and turn it into a investment opportunity. The chinese always seem to be in the right place at the right time. Maybe our government should take a hint.


Dubai crisis gives China chance to buy oil, gold: report
Reuters
Monday, November 30, 2009; 8:39 AM

BEIJING (Reuters) - Dubai's debt crisis could be China's opportunity to snap up gold and oil assets, a senior Chinese official said in remarks published on Monday.
Full article