Dumping the dollar: Record gold price justifies Moscow’s choice to abandon greenback & bet on precious metal

31 Jul, 2020 16:11 / Updated 10 hours agoGet short URL

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Comment: Russia is Debt Free and is now exporting gold around the world and will soon supply Germany and other EU countries with gas. The U.S. has pissed off everyone and is holding a worthless dollar backed by nothing. We will soon see the world ignoring Amerika’s threats as the dollar collapses. Hell, they may invade this country for the resources. Pompous Pompeo and his ilk may end up in front of a foreign firing squad when this country does collapse and it will not be long before it does. America is a Zionist Occupied Gov’t and the American people have foolishly been fine with this. They will pay with their poverty, homelessness, and even their lives. I tried to warn the American people 40 years ago and then again 10 years ago and was viciously attacked. I guess this is what they want then.

By Jonny TickleWashington’s weaponization of the dollar in an effort to crush Russia’s economy seems to be backfiring. The policy encouraged Moscow to pivot to gold and this week the cost of an ounce broke the $2,000 barrier for the first time.

Russia’s choice to move away from storing Benjamins as a reserve currency and to gradually replace the dollar in trade was accompanied by a relentless gold-buying spree. The moves were a reaction to US sanctions, the primary tool of America’s economic war on the world’s largest country. 

On Thursday, an ounce of the precious metal traded at a maximum of $2,005.4 on the US COMEX Commodity Exchange. The growth in gold’s popularity is directly linked to global economic uncertainty due to the Covid-19 pandemic, with it being seen as protection against inflation as the US federal reserve money-printers work overtime.

The price might still be on its way up, with Goldman Sachs analysts predicting a rise to $2,300 within 12 months.ALSO ON RT.COMBye Bye Benjamin! Russia & China speed up de-dollarization process: most trade no longer conducted in greenbacks

The increase in the value of gold comes as a great victory for Moscow’s policy which moved vast sums away from fiat currency and toward the commodity. In the last five years, the country has spent more than $40 billion building up a massive pile of the traditional safe haven, protecting state finances from currency volatility. 

“The Americans are using the US dollar as a weapon, and Russia is absolutely correct in diversifying its foreign exchange reserves,” John Mayer, partner of the investment and consulting company SP Angel, told Moscow news outlet Gazeta. “Gold is the best liquid investment if you do not want to be held hostage by the dollar.” 

In September 2014, Russia’s gold holding was just 10 percent of the country’s entire forex reserves – now the proportion stands at 23 percent, with 2,299.9 metric tons.

In March, Russia’s central bank announced that it would stop buying gold, leading some analysts to believe the country’s mining operations would start selling their metal abroad while the price is high. The prediction turned out to be correct, as the second quarter of 2020 saw the value of gold sales to foreign buyers overtaking gas exports for the first time since at least 1994.

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