Russians Stunned By China's Move to End Western Dominance

Today a legend who was recently asked by the Chinese government to give a speech to government officials in China spoke with King World News about why the Russians were recently stunned by China’s surprise move to end Western dominance.  John Ing, who has been in the business for 43 years, also spoke about the currency wars which are breaking out that will only add fuel to the global fire.

Eric King:  “John, in your October 5th KWN interview you correctly predicted trouble for stocks as you warnedWhen we look at Alibaba trading at over 60-times earnings, this indicates that

the massive rally in global equities is close to the end.”

The next trading day the stock market gapped up very close to it's all-time high and then went straight down.  And with astonishing accuracy, in that same interview you also said we were in the last leg of the dollar rally and that was precisely at the top of the recent rally in the U.S. dollar:

“I think the U.S. dollar is on its last legs in terms of this rally.  And because the United States desperately

needs to maintain its exports, the Fed will look to halt that dollar rally at some point.”

Eric King continues:  “John, what should we expect to see going forward in the stock market, and what about the plans the Chinese are implementing to dominate the world economically?”

Ing: “Recently we have seen a return to volatility and fear.  This is in contrast to the greed that was so pervasive in the market the last time we spoke.  I now believe we are seeing a dead-cat bounce in the stock market.  I also expect this bounce to end at some point this week....

“The pullback and consolidation in gold that we have seen was much needed.  Gold should then attack the $1,275 area, followed by the key $1,300 level.  People need to remember that the end of quantitative easing is going to be felt around the world.

We also have the complication in Europe of the Russian sanctions causing German industrial production to pull back.  Also, Greece is now raising money at 9 percent interest.  This may very well be signaling a revival of the Eurozone problems.

In the United States as we near the end of quantitive easing, there was suddenly the question from a prominent Fed Member asking: Can we delay the end?  But the focal point is on the U.S. dollar.  Currencies have dropped about 8 percent against the dollar.  These gains are taking place amid a global currency war.

Meanwhile in China, they were away for a week in a celebration of the formation of the Communist Party, but before they went away they bought roughly 45 tons of gold in just one week.  My sources in China tell me that the Chinese remain big buyers of physical gold.  Gold activity in Shanghai was at the highest level since early this year.  So going forward we will be hearing a lot more about the Chinese appetite for gold.”

Eric King:  “Recently a Chinese government official openly discussed China’s massive appetite for gold.  It was way ahead of everybody’s figures.  I know that doesn’t surprise you, because you were asked by the Chinese government to give a speech to a great number of Chinese officials.  It turns out that China came very close to consuming almost the entire annual gold mine production for the entire world last year.  That’s unbelievable.”

Ing:  “Well, you haven’t seen anything yet.  There are two major sources of buying.  There is of course the creation of China’s middle class and they are big buyers of gold.  But the second of course is the government itself.  China has not disclosed its official gold position since 2009.  Meanwhile the Chinese keep building more storage facilities to vault their massive gold holdings.

When I was asked to give the speech to the Chinese government officials they were in the process of announcing yet another facility to store 1,900 tons of physical gold.  But incredibly that’s only one year’s appetite.  So, yes, the Chinese will remain strong buyers of physical gold to hedge against their enormous U.S. dollar foreign exchange holdings.

The Chinese are going to eventually use their massive gold holdings to back the renminbi.  This is all part of their plan to dramatically increase the use of the renminbi in international transactions.  Their biggest trading partners in the East have already abandoned the dollar for the renminbi in regional transactions.

But the renminbi will eventually be partially backed or entirely backed with gold.  I told you in our interview in late September that when I was asked to give the speech to the Chinese government officials at the Chinese Gold Congress, the Russians were surprised and listening very intently as one of the Chinese government officials said that the renminbi, which is becoming internationalized, should have a gold backing.  The Russians were surprised because they know this will change the world as we know it.  It will mean the end of Western dominance.”