Malaysia Looks to Ancient Alternative Currency - Gold!

From 11 Big Surprises for the Next Decade:

The Dollar remains strong via foreign fiat currencies but loses to gold, eventually the United States and then the world goes back to a Gold Standard- First it was the collapse of the Euro, then the collapse of China, after came the crisis in the emerging world and the commodity producing nations, and finally civil unrest around the globe. In the second decade of the 21st century the world discovered that the United Stated, with all its problems and weaknesses is still the safest heaven there is. But against Gold it lost big time. Despite a weak economy gold and other commodities continued to trend higher and when the public joined the trade it demanded a Gold Standard. The President, encouraged by Wall Street large banks tried to do the Roosevelt scheme, attempting to outlaw the ownership of gold on a large scale and halting the trading and selling of the precious metal. That was enough for the angry public which thanks to the internet revolution was much more informed than in the 1930′s. A new president was elected in 2016 and a Gold Standard was established.

From the Financial Times:

Paper money is so old hat. While De La Rue – which makes banknotes for 150 currencies – struggles with production problems and management turmoil, in one part of Malaysia, they are looking at an ancient alternative – gold.

In a move applauded by some local Muslims, the state government of Kelantan said it was introducing a new monetary system featuring standardised gold and silver coins based on the traditional dinar and dirham coins once used by the Ottoman Empire.

Nik Abdul Aziz, the state’s chief minister, spoke in visionary terms of an economy in which state civil servants would be paid in the new sharia currency, and the poor would be protected against inflation by the intrinsic value of the precious metals used to produce it.

About 1,000 shops and restaurants in the state have said they will accept the new currency, which follows an earlier issue of gold dinars in 2006. The coins comply with traditional Islamic teaching on the use of coins with intrinsic value as a medium of exchange, rather than paper money.

The coins, minted to a specified weight and purity, are available in a range of denominations from half a dinar to eight dinars, and from one dirham to 20. At the current price of gold, one dinar is worth M$581($183) and one dirham is valued at M$13 ($5).

The launch was lauded by the Muamalah Council, a campaigning organisation that seeks the peaceful introduction of an Islamist social and economic system. The council said it was “the main Islamic event of the last 100 years”.

The details of the scheme suggest, however, that the people of Kelantan are unlikely to abandon the ringgit, the national currency, in a hurry. The state government said the value of the new coins was M$2m at the current price of gold. It is not known how many of each denomination have been minted, but if they were all worth one dinar there would be just under 3,500. That works out at about one coin for each 400 people in the state.

Read the original story at Israel’s Financial Expert