adminUnlike Obamacare, which has had several functions delayed since the disastrous opening of its online web portal, the Chinese are actually moving up their timelines on several new financial platforms which will both threaten US control over global pricing mechanisms, and usher in comparative competition that countries around the world can now have the choice to partake in.
On September 17, the Shanghai Gold Exchange (SGE) announced they were accelerating their launch date for opening a new gold window, with the precious metal platform set to begin buying, selling, and trading gold in the Yuan currency on September 18 instead of on their originally projected start date of September 29.
What makes the SGE unique is that unlike the US controlled Comex, the Chinese equivalent will reside in an international free trade zone and offer customers assurances of protected and secure transactions made without the threat of price manipulation, and with the guarantee of physical delivery.
The Chinese government backed Shanghai Gold Exchange (SGE) brought forward the launch date of its international gold trading platform which is hosted in the city’s free trade zone (FTZ).
The gold trading platform will be known as the “international board”.
In a surprise announcement, the SGE said that the international board will go-live yesterday, eleven days ahead of its original launch date of Monday, September 29.
Forty members of the Exchange including global banks UBS, Goldman Sachs, HSBC and Standard Chartered, will participate in gold trading on the SGE’s international board, trading 11 yuan denominated physical gold contracts including the large 12.5 kg (400 oz) bar, the ever popular 1 kg bar and a 100 gram contract.
The location of the SGE international board in the Shanghai free trade zone is symbolic in that this location has been earmarked by the Chinese government as part of financial sector internationalisation strategy.
The most significant, and perhaps most important component of this gold exchange is that it will be facilitated in yuan and not dollars, which has been the benchmark for price discovery for several decades.
And like Russia’s new programme to allow the sale of its oil in both yuan and roubles, the world is quickly experiencing the option to purchase assets and resources outside dollar hegemony, and ushering in the day when global demand for a new singular or basket of currencies is created to replace the US standard that has reigned supreme for more than 40 years.
With so many countries choosing to move away from the dollar as its value has declined sharplyover the past two decades, the yuan is coming into its own to become a strong and viable challenger to replace the reserve currency in the global trade arena.
And even as the British Chancellor of the Exchequer George Osborne declared recently that the RMB (Yuan) is looking like it will become the next global reserve currency, that day may be as close as tomorrow as China opens a new international gold window that will strive to wrest price discovery out of the hands of the dollar, and into the dominion of the yuan.- Yahoonews.
Online Reporter