Could Russia back its currency with gold?
Jhe war in Ukraine could change the global financial system for the foreseeable future. Financial measures taken by Western countries to insulate the Russian economy after Russian President Vladimir Putin’s invasion initially caused the ruble to fall 30% against the dollar. But the ruble rebounded due to some savvy moves by the Russian government. First, on March 23, Putin signed an agreement under which foreign buyers must pay for natural gas in rubles. Second, on March 28, the Russian Central Bank announced that it would place the ruble on a gold standard. Third, on March 30, the Russian Duma signaled its intention to charge foreign buyers for grain, oil, nickel, aluminum, uranium, neon, and other Russian products in rubles.
These movements stimulated the demand for rubles and decreased the demand for dollars. But it’s the second move – peg the ruble to gold – that history could record as the start of a financial revolution. Russia already has the fifth largest gold hoard after the United States, Germany, Italy and France. This treasure is destined to grow. Since Russia has priced 5,000 rubles to equal one gram of gold for the next three months, it can buy gold from local Russian banks for $1,475 per ounce (well below the gold price). market).
Since Russian gold is under Western sanctions, Russian banks and citizens who want to sell gold have no choice but to sell it to the Russian Central Bank. Therefore, the value of the ruble will likely increase over the next few months as the Russian Central Bank buys gold from domestic sources. Russia currently has about 2,533 tonnes of gold in its reserves. Any currency backed by gold is perceived as more stable.
Many Western analysts believe that Russia will soon be forced to abandon its gold-pegged rouble, which could be a correct assessment in the short term. Yet Russia is already discussing setting up a new financial payments system with China and India to circumvent the US dollar by allowing bilateral trade in local currencies.
Given that Russia, China and India collectively own 16% of the world‘s central bank gold reserves, gold could play a vital role in this new payment system. In addition to chatter about a gold-backed rouble, economic analysts are talking about a gold-backed yuan. Money Week’s Dominic Frisby reports that China almost certainly has more gold than the US, even though its official gold holdings are only a quarter of US gold holdings. China is the world’s largest miner and more than half of its gold production is state-owned. According to stockbroker Alasdair McLeod, China “probably has up to 30,000 tons hidden in various accounts, but not reported as official reserves.”
If Russia, China, and India cooperated to establish a gold-based financial exchange mechanism, then all three nations already have enough gold reserves to deal a severe blow to US fiat currency.
Only time will tell how this situation will unfold. Yet dozens of Bible prophecies predict the collapse of the United States (request a free copy of The United States and Britain According to Prophecy proof). And a prophecy from Ezekiel suggests that gold could play a vital role in the downfall of the US economy.
“They will also gird themselves with sackcloth, and horror will cover them; and shame will be on every face, and baldness on every head. They will throw their silver into the streets, and their gold will be carried away; their silver and their gold will not be able to deliver them in the day of the LORD’s wrath: they will not satisfy their souls, nor fill their bowels. for it is the stumbling block of their iniquity” (Ezekiel 7:18-19). This passage takes place about a time after the American people were taken captive. plagues known as the “day of the Lord’s wrath”.
Ezekiel warns that all the gold and silver in the world will not be able to buy food during this terrible time, so people will throw their silver and gold on the streets. Yet, in order for people to throw their silver and gold on the streets, they must first possess it. For the most part, neither silver nor gold has been used as currency since President Richard Nixon took America off the gold standard. Does this passage indicate that America’s enemies will begin to use gold-backed currencies as a weapon against the dollar?
Russia, China, India and the European Union have large enough gold reserves to do so if they wish.
Whether or not Russia’s gold-pegged ruble is a first step towards a return to the gold standard, Ezekiel’s most important point is that the day will come when there will be nothing left to eat. . Thus, no one will care how much gold a person has. The only safe long-term investment guaranteed to produce a massive return is an investment in your relationship with God. “Do not lay up treasures on the earth, where moth and rust corrupt, and where thieves enter and steal; but lay up treasures in heaven…” (Matthew 6:19-20).
For more information on how to receive God’s protection from future calamities, please read Repentance towards God and Jordan and the Church of God in Prophecy, by Trumpet editor Gerald Flurry.