HONG KONG – The president of the World Bank said in a newspaper interview Monday editorial that the Group of 20 major economies to consider a global reserve currency based on gold as part of structural reforms of exchange operations in the global regime.
World Bank chief Robert Zoellick said in an article in the Financial Times that leading economies should consider “using gold as an international benchmark of market expectations on inflation, deflation and future currency values.”
Zoellick made the proposal as part of reforms to be considered at this week’s G-20 meeting in Seoul.
“While textbooks can see gold as the old money, the gold markets are used as an alternative monetary asset today,” said Zoellick.
He said one such reform should reflect economic reality and should be considered as a successor to the existing global currency paradigm known as “Bretton Woods II.”
Obama and the Taliban
President Obama has an olive branch to Afghan militants who want to lay down arms and respect the country constitution. Video courtesy of Reuters.
Bretton Woods II refers to the system that began in 1971, when U.S. President Nixon took the U.S. dollar link to gold as established under the Bretton Woods agreement is terminated.
Zoellick said that a return to a type of currency link to gold would be “practical and feasible, not radical.”
“This new system is likely to need the dollar, euro, yen, pound and that a renminbi internationalization and then moves to an open capital account should be involved,” he said.
source:marketwatch
Oil Futures: Nymex Crude Mostly flat as Dollar Drops
NEW YORK (Dow Jones) - Crude oil ventured slightly higher Monday despite lower equity markets as the dollar fell slightly against competing currencies. . . Read more »
Gold hovers near 1-1/2-week top rating from Portugal
Spot gold on Wednesday, hovering near a 1-1/2-week high hit the previous session, supported by renewed concerns about the debt of the euro after the Moody's downgrade issue credit rating to junk Portugal. . . Read more »