China's multi-billion-dollar question


By Richard McGregor
Financial Times, London
Sunday, January 21, 2007

With a vaguely worded statement from Wen Jiabao, China's premier, at the close of a weekend meeting in Beijing on finance policy, the die has been cast for a momentous change in the management of the country's massive foreign exchange reserves.

Mr. Wen said the management of the reserves, the world's largest at more than a thousand billion dollars, should be improved and the channels through which they are invested diversified.

GATA supporters in Southeast Asia invited to dinner in Singapore


11:15a ET Sunday, January 21, 2007

Dear Friend of GATA and Gold:

GATA supporter Gabriel Low, who lives in Singapore, has graciously agreed to organize there an informal dinner for GATA supporters in Southeast Asia if there is enough interest. The dinner would discuss mutual interests and possible mobilization on behalf of the liberation of the gold market. If you might be interested in attending such an event, please e-mail Gabriel here:

Leading Canadian banker recommends gold, denounces fiat system


11a ET Sunday, January 21, 2007

Dear Friend of GATA and Gold:

Gold got a stirring endorsement and the central bank system of infinite money a denunciation last week from a remarkable source -- a leading banker in Canada's financial establishment.

The banker, Anthony S. Fell, chairman of RBC Capital Markets and former president of Royal Bank of Canada, delivered the endorsement and denunciation at RBC's client appreciation dinner in Vancouver.

China's reserves reach trillion; premier promises to start spending


From Xinhua News Agency
via China Daily, Beijing
Sunday, January 21, 2007

Chinese Premier Wen Jiabao said that China would steadily push forward the foreign exchange rates reform and actively explore and expand the use of its US$1.06-trillion foreign exchange reserves.

China would strengthen operation and management of foreign exchange reserves and facilitate the balance of international payment, said Wen at the two-day Third National Financial Work Conference.

Chinese govt. economist says yuan requires big revaluation


From Reuters
Sunday, January 21, 2007

BEIJING -- China's policy of allowing the yuan to gain a modest 3-5 percent a year is not sustainable as the cost of preventing a faster rise will crush the central bank, a Chinese economist said.

Zhong Wei, a professor at Beijing Normal University and an editor of a magazine run by the State Administration of Foreign Exchange, told a weekend forum in Beijing that China needed another revaluation to build up a properly functioning exchange rate system.

Ecuador calls foreign debt 'illegitimate,' may default on 60%


By Lester Pimentel and Jeb Blount
Bloomberg News Service
Friday, January 19, 2007

Ecuador's credit rating was cut by Standard & Poor's two days after the country's economy minister told investors the government was considering repaying only 40 percent of its foreign debt.

S&P cut the rating one level to CCC, leaving it four levels above default, from CCC+ and lowered the rating outlook to negative from stable. Economy Minister Ricardo Patino, speaking today in Rio de Janeiro, said he expects to finish a debt restructuring plan by the end of the month.

Venezuelan legislature votes to give Chavez dictatorial power


By Natalie Obiko Pearson
Associated Press
Friday, January 19, 2007

Venezuelan lawmakers gave initial approval to a bill granting President Hugo Chavez the power to rule by decree for 18 months so that he can impose sweeping economic, social, and political change.

Emboldened by his landslide re-election last month, the leftist leader has called for "revolutionary laws" to accelerate the country's transformation into a full socialist state.

Young euro threatens dollar supremacy


By Barrie McKenna
The Globe and Mail, Toronto
Thursday, January 18, 2007

WASHINGTON -- Flash the greenback just about anywhere in the world, and chances are you'll seal the deal.

The mighty U.S. dollar remains the world's default currency. Central banks keep two-thirds of their reserves in dollars.

Ted Butler: Changing of the guard?


8:40p ET Tuesday, January 16, 2007

Dear Friend of GATA and Gold:

Silver market analyst Ted Butler writes that the technical futures trading funds that have been milked regularly by the commercial shorts are withdrawing from the silver market and being replaced by commodity index funds that are not so easily shaken out at a loss. Butler's new commentary is titled "Changing of the Guard?" and you can find it at GoldSeek's companion site, SilverSeek, here:

India approves exchange-traded funds for gold


From Press Trust of India
Tuesday, January 16, 2007

MUMBAI, Jan. 15 -- Market regulator SEBI today gave a go-ahead to mutual funds for floating gold exchange-traded funds (GETF), thus enabling the investors to trade in gold as shares in the stock market.

In a notification, SEBI said: "The gold held by a gold exchange-traded fund scheme shall be valued at the AM fixing price of London Bullion Market Association (LBMA) in US dollars per troy ounce for gold having a fineness of 995.0 parts per thousand." The Custodian of Securities Act has also been amended, enabling custodians of the proposed gold funds to outsource safekeeping of bullion to other agencies.