Arkady Dvorkevich, the Kremlin's chief economic adviser, said Russia would
favour the inclusion of gold bullion in the basket-weighting of a new world
currency based on Special Drawing Rights issued by the International
Monetary Fund.
Mr Dvorkevich said it was "logical" that the new currency should
include the rouble and the yuan, adding that "we could also think about
more effective use of gold in this system".
The Gold Standard was the anchor of world finance in the 19th Century but
began breaking down during the First World War as governments engaged in
unprecedented spending. It collapsed in the 1930s when the British Empire,
the US, and France all abandoned their parities.
It was revived as part of fixed dollar system until US inflation caused by the
Vietnam War and "Great Society" social spending forced President
Richard Nixon to close the gold window in 1971.
The world's fiat paper currencies have lacked any external anchor ever since. |
... when Russia and China are outflanking your government on the right and headed toward the gold standard. And they're absolutely correct of course.
But the consequences for us are not going to be pretty.
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