Iran to prepare for a big currency war?

[nomoba]

“Iran has opened a new gold processing plant, reportedly the biggest in the Middle East, hoping to double its production of precious metals. Using a unique technology, Tehran says it will now mine up to three tons of gold per year. Iranian TV reported that the opening ceremony was attended by First Vice President Ishaq Jahangiri.”


“It is expected that the plant’s gold production capacity will soon reach six tons per year. Silver and mercury productions are expected to hit 2.5 and 1.5 tons, respectively.”


“This implementation is part of the so-called 'economy of resistance,' which Iran's Supreme Leader, Ayatollah Ali Khamenei, introduced in February. The policy includes domestic economy building with maximum utilization of the country’s resources, as well as the promotion of a knowledge-based economy and innovation. The ultimate goal is to become the No. 1 knowledge-based economy of the region.”

RT

[cyu]

If they have the backing of Russia, they might have more success than previous nations that tried to go it alone and ended up on the receiving end of American "regime change".

But I'd say their attempts to use gold as part of their plan is misguided - or at least it would be misguided for leftist economies trying the same thing. On the other hand, if you don't plan on having a leftist economy, and would be perfectly happy catering to wealthy foregin capitalists, then I can see why they may continue to use gold as part of their economy.

Just as plastic surgeons might make a decent living providing Botox treatments to the wealthy, gold has a similar function in that it is primarily used by the wealthy as an investment vehicle. An economy of leftists has little use for gold - what workers need instead is farmland, raw materials, equipment, ie. the means of production that they'd use to produce the stuff they themselves consume.

[tuwix]

“Iran has opened a new gold processing plant, reportedly the biggest in the Middle East, hoping to double its production of precious metals.(...)





And why do you think that Iran is preparing for currency war?


Gold doesn't back major currencies from decades...

[cyu]

Russia has been preparing for it for a long time. See http://www.revleft.com/vb/crashing-mediums-exchange-t175288/index.html

...I would assume their primary goal being to knock the US down a few pegs - given that the US and USSR were both, at one point in living memory, considered the world's 2 dominant powers, I suspect there may be something of a collective chip on the shoulder of Russians whenever someone refers to the US as the only remaining superpower.

And given that the US regularly considers Iran to be an enemy state, for one reason or another, I'm sure Iran would be keen to help anybody knock down the US a bit too.

Over the past few months (or year?), many nations have been negotiating deals to remove the dollar from international trade - so yeah, it's currency war. If the dollar loses its defacto world reserve currency status, then the US will be less able to buy massive amounts of military hardware by printing money (or QE).

The latest de-dollarization news from yesterday http://www.zerohedge.com/news/2014-12-01/putin-kills-south-stream-pipeline-will-build-new-massive-pipeline-turkey-instead

TURKEY, RUSSIA AGREE TO USE LOCAL CURRENCIES IN TRADE

[nomoba]

As BRICS are in the processes to decouple economies from the Western neoliberal monetary monopoly, they could bring back the gold standard as a base for their transactions, which is much more steady than the paper money unstable financial bubbles. They are ready, because they are emerging economies with billions of potential consumer tanks and can attract other countries too being victims of the international financial mafia, like Argentina and Greece.

[cyu]

they could bring back the gold standard


That's probably why South Africa was added to the club. Not that South Africans don't deserve as good of a life as anybody, but if you want to talk economic "fundamentals", I would put gold in the same category as paper money, yachts, limos, and "priceless" paintings - that is, things purchased by the rich - things that are high priced only because the rich can spend a lot on them, not because any large population of people has practical use for them.

When an economy becomes polarized between rich and poor, the goods and services in that economy also becomes polarized between stuff purchased by the rich and stuff purchased by the poor. Stuff the rich buy is useful to very few people, but has a high price. Stuff the poor buy is used by many people, but has a low price. Yachts and limos fall into the first category. Same with investment vehicles purchased by the rich - whether it's gold, foreign exchange, stocks, bonds, or any other financial instrument.

[Rugged Collectivist]

Gold is used to make electronics. It's not completely useless.