Marcia Christoff-Kurapovna: Is Russia planning a gold-based currency?

Section:

Marcia Christoff-Kurapovna
Mises Institute, Auburn, Alabama
Friday, February 6, 2015

The "perfect storm" of geopolitical instability, diplomatic isolation, severe currency depreciation, and economic decline now confronting Russia has profoundly damaged Moscow's international standing, and possibly for the long term. Yet it is precisely such conditions that may push the country's leadership into taking the radical step that will secure its world-player status once and for all: the adoption of a gold-exchange standard.

Though a far-fetched idea at first glance, many factors suggest that remonetization in gold may be a logical next step for Moscow.

First, for years Moscow has been expressing its unwillingness to remain at the monetary mercy of the United States and its NATO allies, and this view has been most vehemently expressed by President Putin's long-time economic adviser, Sergei Glazyev. Russia is prepared to play strategic hardball with the West on the issue: The governor of Russia's central bank took the unusual step last November of presenting to the international media details of the bank's zealous gold-buying spree.

The announcement, in sharp contrast to that institution's more taciturn traditions, underscores Moscow's outspoken dismay with dollar hegemony. Its timing suggests coordination with the top rungs of government to present gold as a possible currency-war weapon. ...

... For the full commentary:

http://mises.org/library/russia-planning-gold-based-currency



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