Gold hits an all time high in 72 currencies

by Ross Norman on January 15, 2019

It is natural that we measure things by a familiar yardstick – the problem is that being so-biased or lazy, we can be deceived.

Take gold. Popular belief has it that gold prices have not performed especially well despite some egregious geopolitical and economic factors. Well measured in 72 currencies, gold is at … or within a few percentage points … of being at an all time high for people in those countries. Not on the list are the British Pound, the Swiss Franc, the Euro and Chinese Yuan – but we are not far off in all of those currencies too. Only in USD does gold lag – and not all of us live in the US.

Using the dollar gold price, as most of us do, has disguised what is actually quite a powerful bull market. If my memory serves me right, we saw the same phenomenon – a stealth rally in minor currencies – ahead of the last major gold bull run (in dollars) in the late 1990’s. Arguably this may be a very good leading indicator.

Faulty yardsticks also takes us onto wealth management. Measuring our net worth in local currencies, we might be rather pleased with ourselves – smug even. However we chose to ignore the fact that the yardstick is not a constant … it is shrinking and sometimes really quite fast. It’s the natural corrosive effect of inflation. Knowing this, governments give us a gauge for yardstick shrinkage to use such as RPI or CPI, to reassure you that the shrinkage is minimal… and then lie about it.

There are alternatives.

In the US, the Chapwood Index is highly regarded as it reflects the true cost-of-living increase. Plainly and simply, the Index shows that incomes can’t keep up with expenses, and it explains why people increasingly have to turn to the government for entitlements to bail them out. The basis of the Index is fullly open to scrutiny and if correct suggests Americans have been losing roughly 10% of their wealth each year since 2014. Half of it gone. This compares with the official government figure of 1.9%. Ronald Reagan called inflation “the thief in the night” and it is built for times just as this. It gives the appearance of being wealthy (maintaining high nominal values) while eroding your actual position – which manifests itself in far higher costs on the other side.

Interestingly, gold has seen an average year-on-year gain of about 10% compounded since 2000 – off-setting those real losses – which reaffirms in our mind that it continues as a reliable yardstick against which to measure costs or indeed wealth. In short, gold has maintained what economists call “purchasing power parity” for millenia. So not only is it an excellent yardstick – its actually quite a useful thing to own – especially if you fear wealth erosion. If you haven’t already read this, you must – see :Jastram’s Golden Constant

Many crises invariably start with stealth inflation and then follows currency weakness – so gold gets expensive and then it blows out significantly higher in your local currency. Then you realise that the lifeboat has sailed … the choo-choo train has left the station.

For the unprotected, your backstop plan to protect your wealth by “buying gold when I need it” has just failed. You are now trapped with a dissolving currency and every financial escape route looks too expensive … and so it goes. Ask anyone in one of those 72 countries (see below) where gold is starting to look expensive.

In short, insurance is best bought before you think you need it … boring, but true.

Bove sees global rise of Chinese currency as threat to US prosperity

PUBLISHED MON, JAN 14 201911:33 AM ESTUPDATED MON, JAN 14 20193:33 PM ESTRichard X. Bove


  • China and its allies have placed a great deal of emphasis on using the yuan as a dollar replacement in many parts of the world.
  • In areas where this has happened, it presents a threat to U.S. trade and economic health, writes Dick Bove, analyst at Rafferty Capital.
Chinese yuan and dollarChina Photos | Getty Images

No one is likely to dispute the fact that China and its allies are working diligently to establish a multilateral world. In it China would control its own sphere from the eastern Pacific rim to the countries located along the historic “Silk Road.” That trade route stretched from East Asia to West Africa.

In this regard, a great deal is being written about the Chinese military build-up in the Pacific; the theft of technology secrets; unfair trade policies; and discriminatory investment practices. Very little focus has been placed upon the creep of the yuan and the expansion of the Chinese banking system. Yet, this might be the greatest threat of all.

China and its allies have placed a great deal of emphasis on using the yuan as a dollar replacement in many parts of the world. In those areas where this shift has occurred countries fall out of the United States orbit. This impacts U.S. economic health and, at some point, will affect the ability of this country to grow trade internationally and to fund its debt with international resources.

Yuan Creep

Prior to China joining the World Trade Organization in December 2001, only a few hundred banks in the world would clear transactions completed in yuan. A decade later, it was reported that well over 10,000 banks, worldwide would transact in the yuan. So many global entities were using the yuan that in October 2016, the International Monetary Fund (IMF) decided to include the yuan as one of four currencies backing its Special Drawing Rights (SDRs). In sum, the yuan had become one of the world’s reserve currencies.

The yuan had reached this lofty level due to a three pronged approach. First, countries that had historic issues with United States dollar dominance supported greater use of the yuan. They include Russia, Iran, North Korea and to some extent South Africa and Brazil.

Second, China isolated countries that were having difficulty accessing large amounts of dollar based loans due to poor repayment histories. In South America this included small nations like Ecuador and larger countries like Venezuela and possibly Argentina. In Africa, the list is very long. At the top is Angola, Ethiopia, and the Republic of the Congo.

The third group of nations are countries, primarily in east Asia, who trade heavily with China. In many cases, the Chinese demand that these nations use the yuan in all trading transactions. In fact, China has gone even further. It has established the Asian Infrastructure Investment Bank, a replica of the western world’s IMF. This banks is funded by China and lends to other Asian nations.

Stated crudely, the yuan is becoming the dominant currency in many countries with small and troubled economies but the world’s largest and fastest growing populations.

Why is this Important?

The American Century was built on many factors related to the stability of this nation’s economy; its strong military; and its financial dominance. Following World War II, one might argue that the dollar was the only currency in the world that mattered. Backing this currency was a large, relatively stable, banking system. If a nation wanted to trade internationally it had to have dollars and the only place to acquire them was from American banks.

Some would argue that this financial dominance led to the creation of the multilateral rules and organizations that fostered and incentivized the global growth that developed in the past 7 decades whereby virtually every nation benefited. If yuan creep continues these rules and organizations will be re-written.

Most importantly, large areas of the world will function under a new financial system orchestrated by China. From the perspective of the United States this would reduce this nation’s trade and its ability to fund its debt. Yuan Creep has the potential to cause major disruptions in this country over time.

How is the U.S. Reacting to this Threat?

Actually, the U.S. is unwittingly aiding Yuan Creep. This country is penalizing domestic banks that increase in size. It is putting operating restrictions on American banks that operate in global markets. It is using its banks to attack other nations with a variety of financial sanctions. It is penalizing foreign banks that compete with China in nations shifting their financial allegiances.

The United States is creating a financial vacuum into which the Yuan is creeping. The biggest banks in the world are now headquartered in China. The biggest U.S. bank is smaller than the fourth biggest Chinese bank. This is simply bad for this country.

NGC To Offer ASF Labels for Apollo 11 Commemorative Coins


Numismatic Guaranty Corporation® (NGC) has officially licensed the Astronaut Scholarship Foundation (ASF) logo for special NGC certification labels that celebrate the U.S. Mint’s Apollo 11 50th Anniversary Commemorative Coins. The coins go on sale January 24, 2019.

2019-P Apollo11 50thAnniversary MS70 Early Release

A visual of an NGC-graded 2019-P Apollo 11 50th Anniversary Commemorative Coin with an ASF label

The Apollo 11 50th Anniversary Commemorative Coins are among the most highly anticipated U.S. Mint issues of the last decade. The coins are particularly noteworthy for their curved design, which resembles the view of the moon’s surface from an astronaut’s helmet.

Clad half dollars, silver dollars in one-ounce and five-ounce sizes and gold five dollar coins are being struck. Notably, both the one-ounce and five-ounce silver dollars are being struck in .999 fine silver instead of the usual .900 fineness. This is the first time that a US commemorative silver dollar has been struck in .999 fineness, and this composition will be reflected with a notation on the NGC certification label for the one-ounce dollars.

Also significant is the curved silver five-ounce coin. The largest curved coin ever issued by the U.S. Mint with a diameter of three inches, its production presented numerous challenges. These were ultimately overcome and the Apollo 11 silver five-ounce is expected to become one of the most desirable US modern coins in recent memory.

The legislation that authorized the Apollo 11 coins designated the ASF as one of three organizations that would benefit from a surcharge applied to the sale of these coins. The additional beneficiaries are the Smithsonian Institution’s National Air and Space Museum and the Astronaut Memorial Foundation.

ASF was created in 1984 by the six surviving Mercury program astronauts as well as the widow of the seventh. Each year, ASF provides more than 50 scholarships to outstanding college students in science, technology, engineering and mathematics.

The six manned flights of the Mercury program enabled NASA to master the technology necessary to put astronauts in orbit. This critical step paved the way for the Gemini and Apollo programs that followed, culminating with the Apollo 11 moon landing in July 1969. That historic mission is celebrated by the coins being released this month.

The NGC ASF label is the default label for Apollo 11 50th Anniversary Commemorative Coins submitted to NGC and carries an automatic $5 fee. A royalty will be paid to the ASF by NGC for each label used.

“NGC’s leadership in third-party coin certification made it an ideal partner to collaborate with ASF to promote its important mission and the Apollo 11 50th Anniversary Commemorative Coin Program,” says Tammy Sudler, President & CEO of ASF. “NGC-certified Apollo 11 Commemorative Coins encapsulated with the NGC ASF label are unique and attractive collectibles that not only honor one of history’s greatest achievements but also support the mission of ASF.”

“The Apollo 11 50th Anniversary Commemorative Coins celebrate one of mankind’s greatest triumphs,” adds Mark Salzberg, NGC Chairman and NGC Grading Finalizer. “NGC is pleased to work with the Astronaut Scholarship Foundation to honor this event and these coins with an attractive label that is sure to appeal to coin collectors and space enthusiasts alike.”

For detailed submission instructions, visit

NGC has certified more than 42 million coins, medals and tokens. Founded in 1987, the company provides accurate, consistent and impartial assessments of authenticity and grade. For more information about NGC and its grading services, visit