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Thread: Malaysia to go on the gold standard?

   
   
       
  1. #1
    Join Date
    Nov 2008
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    Malaysia to go on the gold standard?

    Malaysia Wants OIC Countries To Reconsider Gold Dinar For Trade

    KUALA LUMPUR, Dec 6 (Bernama) -- Malaysia wants Organisation of the Islamic Conference (OIC) member countries to reconsider the use of the gold dinar for trade, especially with uncertainties in the international currency market.

    In stating this, Second Finance Minister Tan Sri Nor Mohamed Yakcop said Malaysia would attempt to hold discussions with the OIC countries so that the issue of using the gold dinar could be studied in depth.

    "At this time when the currency market is uncertain and challenging, maybe it will be good for the OIC countries to look again at the role of the gold dinar in increasing trade among members," he told reporters here Saturday after officiating the opening of a building, Wisma Yayasan Ekonomi Sejagat here.

    Former prime minister Tun Dr Mahathir Mohamad proposed the use of the gold dinar in global trade in 2002.

    Nor Mohamed said with the challenging economic conditions and weaknesses in the financial system, the use of the gold dinar could be reconsidered.

    "Before this, our suggestion was not well accepted by the OIC countries. But now with the weaknesses in the financial system, maybe we can look at the gold dinar proposal again," he said.

    -- BERNAMA

    This one escaped me in the local news and I saw it posted on Jim Sinclairs website. Go figure.

    However, I frankly doubt Malaysia knows what its talking about. There is an extreme lack of details in this report. Also read some time ago that our DPM was proposing a revisit of the Bretton Woods system. Again, zero details. Making me believe that he's saying this for effect and parroting what someone else is saying.

    Just for your information, Bretton Woods was a monetary management system established after world war 2. In a nutshell, it worked like this.

    Who has the most guns? (US)
    Who has the most gold? (US - they confiscated it from their citizens in 1933)
    Who helped most to win the war? (US - they are still the ONLY country in the world who has ever used nuclear weapons against another country.)

    So, World, since we have the most of everthing and the most gold, we'll peg the USD to gold and the rest of ya'll can rate your currencies against ours. To sweeten the deal, we'll even allow you to redeem any excess USD you have for our gold. Hell, we'll even set up the IMF to make sure ya'll get loans to buy our currency. Of course, this system collapse in 1971 when Nixon stopped allowing gold convertibility at the height of the vietnam war and ushered in the past 3 decades of money made out of Air.

    For a more politically correct version go here: http://en.wikipedia.org/wiki/Bretton_Woods_system

    Back to Malaysia.

    1) The gold standard requires an enormous amount of fiscal responsibility. As much as I want to give ourselves the benefit of the doubt but.....

    2) The gold standard in Bretton Woods called for a reserve currency to work. Who will it be this time? Malaysia? China? UAE? Don't make me laugh. How long do you think it'll take before one of them stops giving you gold for paper.

    3) The gold standard requires a huge amount of gold reserves. The largest reserves in the world is still the US at 8000 tons. And even then, it ain't enough gold to rate against the trillions in paper.
    In comparison, China as an economic powerhouse 'only' has 600 tons.
    How much gold does Malaysia have? Someone care to elucidate?

    I really wish our politicians would speak intelligently instead of always talking c***.

    Any comments appreciated.

  2. #2
    Join Date
    Oct 2008
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    13,391

    Re: Malaysia to go on the gold standard?

    Quote Originally Posted by Amadan
    How much gold does Malaysia have? Someone care to elucidate?
    I posted an article somewhere in Tindak Malaysia - "Where is our gold". http://tindakmalaysia.com/tm_forums2...opic,87.0.html

    Basically, Malaysian Gold holding:

    1998 before Anwar's sacking: 73 tonnes
    1999 after Anwar's sacking: 36 tonnes. You can thank Mahathir for that.
    2008: 10.7 tonnes.

    Malaysia can go back to the gold standard if she uses the stuff we burn for Cheng Meng.
    py

  3. #3
    Join Date
    Oct 2008
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    179

    Re: Malaysia to go on the gold standard?

    i don;t think there is enough gold to replace money.

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