Putin aide's advice: Default on foreign debt, put reserves into gold and BRICs bonds

Section:

8:35a ET Tuesday, September 8, 2015

Dear Friend of GATA and Gold:

Russia's government long has understood gold's secret power over the international monetary system. In an address in June 2004 at the summer meeting of the London Bullion Market Association at the Kempinsky Hotel in Moscow, the Russian central bank's deputy chairman, Oleg Mozhaiskov, spoke only four words in English: "Gold Anti-Trust Action Committee":

http://www.gata.org/node/4235

As far as GATA itself knew at that time, it had never had any contact with anyone in Russia or anyone connected with the Russian government.

But Russia's expressions of interest in gold have multiplied since then and another one was reported today by the Moscow-based financial newspaper Kommersant ("The Businessman"), which described a plan to achieve Russia's economic sovereignty that is to be presented next week to Russia's Security Council by Sergei Glazyev, a politician and economist who is an assistant to President Vladimir Putin:

http://www.kommersant.ru/doc/2805251

Glazyev is among the small number of Russian officials targeted specifically by U.S. economic sanctions, and according to Kommersant his plan includes a section about "neutralizing anti-Russian sanctions."

... Dispatch continues below ...



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Kommersant's report is available only in Russian, but a Google translation of its 12th paragraph says Glazyev proposes authorizing Russian companies to "declare force majeure" against loans from countries that have imposed financial sanctions against Russia, "in effect the legalization of non-repayment of all private foreign debt"; converting the reserves of Russia's central bank and the government's Reserve Fund and National Welfare Fund into gold and obligations of the "BRICs" countries; and creating a system of international payments separate from the Western-controlled SWIFT system that would operate with China's UnionPay system.

Of course these aren't terribly original or insightful ideas. No country that uses another country's currency for its international commerce is fully sovereign, and only gold is a neutral international reserve currency. It is precisely to rope the world into the U.S. imperial system that the International Monetary Fund prohibits its members from formally linking their currencies to gold, though commodity-producing countries like Russia, South Africa, Mexico, and those in the rest of the developing world are particularly oppressed by such rules.

The question long has been whether any of them will ever have the nerve to do something about it. Glazyev's report may be an invitation.

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
CPowell@GATA.org

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