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$9,000/oz gold could back world currency

A post-dollar world may emerge with a global currency that could be backed by gold, Currency Wars author Jim Rickards argues in his latest book.

A further collapse of the global economy and a resulting demise of the US dollar as the reserve currency could trigger a move to the International Monetary Fund’s (IMF) Special Drawing Rights, which may then be backed by gold at $9,000 per ounce, Rickards says.

“$9,000 per ounce is a good first approximation of the non-deflationary price of gold in a global gold-backed SDR standard,” Rickards writes in his new book, The Death of Money.

“In Currency Wars I said it was late but not too late to avoid a collapse of confidence in the dollar. But now I believe that, while the catastrophe is not upon us, we may have passed the point of no return,” he tells The Bullion Desk in an exclusive interview.

“The biggest problem is that policymakers and the central bankers are using the wrong models – their models do not accord with realities,” he says.

Three mid-term outcomes could lead to a collapse of confidence – hyperinflation, disinflation or social chaos.

“As far as gold is concerned, we know Russia has increased its gold reserves 70 percent in the last four years, and China has increased its gold reserves several hundred percent. Other central banks have stopped selling – many of them are actively acquiring,” Rickards says.

Source The Bullion Desk

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