Greg Hunter – Financial writer and gold expert Bill Holter contends China has enormous debt problems, but a very good plan B. Holter explains, “China used fiat debt to build real infrastructure, and when the system blows up, the fiat debt blows away and they are left with infrastructure. Do they have 20% bad loans? They very well could and probably do. If it is true that they are going to have a debt blow up, don’t forget China has been importing big tonnage of gold for years now.
Over the last five years, they have imported 9,000 tons of gold. Their way out is the old way out. The old way out was to revalue gold higher. They could revalue gold and step up and say they will pay $50,000 or $100,000 per ounce for any and all ounces for sale. You can’t say there is not enough gold. What you can say is that it’s not priced correctly to support the system. If they have an implosion of debt which leaves their balance sheets impaired, the way to recapitalize the balance sheets is to revalue the price of gold higher. It creates capital, in other words.” Continue reading