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China almost certainly owns more gold than the US – here’s why that matters

serfserf Member Posts: 9,225 ✭✭✭✭
edited March 8 in Politics


Need some energy? How much real money do you have to spend?

serf

https://moneyweek.com/investments/commodities/gold/603131/how-much-gold-does-china-own

If China decides to weaponise money, as the US has done, all it has to do is declare its gold holdings, perhaps even partially back the yuan with them. Talk was, at one stage, its central bank digital currency (CBDC) would be partially gold backed.

Unbacked Western money risks losing a great deal of its purchasing power in such an event. To back Western fiat even partially with gold would mean a dramatic upwards revaluation of gold – into the tens of thousands.

Comments

  • waltermoewaltermoe Member Posts: 846 ✭✭✭✭

    It only makes cense, for years they devalued their money so their products would be more attractive around the world. By doing away with fiat money and backing their currency with gold would definitely change the playing field. However, in todays world, energy seems to dominate gold, you can back your money with raw materials in stead, such as oil. How ever, gold has always been worth something of value because of it’s rarity. If they would do this, I would say that we would be through borrowing Monopoly money from the bank.

  • mike55mike55 Member Posts: 2,266 ✭✭✭✭

    Can gold survive a nuke? Gold will be worthless soon if we don't change course soon!

    If we don't all nuke ourselves to death, I still say LEAD is worth way more than gold. Those gold bricks are extremely hard to throw at an attacker! My lead is self propelled 😁😎

  • select-fireselect-fire Member Posts: 69,473 ✭✭✭✭

    Gold at its all time high.

  • serfserf Member Posts: 9,225 ✭✭✭✭

    FYI. Related theme possible scenario unfolding? Fiction characters inserted into today's world?

    serf

    World Money Crisis is coming

    https://www.youtube.com/watch?v=fI-7cSswSPE

    Jim Rickards lays out a war simulation that looks like it's taking place with Putin and XI against the west. The world economic forum has pushed for an all out reset and this certainly could happen under these conditions. In this reset there will be a need for cryptocurrencies and digital assets like xrp, cardano, and bitcoin because fiat starts falling. Also the protocols that consume all stocks, bonds, house titles, real estate everything will be secured on these networks and wrapped.

  • waltermoewaltermoe Member Posts: 846 ✭✭✭✭

    Was curious so looked it up. United States has the largest gold reserve at over 8100 metric tons, China is the 6th, with a gold reserve of 1910 metric tons.

  • mac10mac10 Member Posts: 2,148 ✭✭✭✭

    Fort Knox is full of gold painted bricks

  • select-fireselect-fire Member Posts: 69,473 ✭✭✭✭

    Fort knox hold a lot of gold from other countries

  • serfserf Member Posts: 9,225 ✭✭✭✭
  • mike55mike55 Member Posts: 2,266 ✭✭✭✭

    I still say lead is and will be more valuable than gold, lead loaded into live ammo that is!

  • BobJudyBobJudy Member Posts: 5,385 ✭✭✭✭

    Gold is no different than any other medium of exchange. Just like diamonds, its value and rarity is artificially influenced by the market. It is nothing more than a metal that has some value in electronics and has a pleasing color. If you stop to think about it, it has no more value than what has been assigned to it by the market. Just like our currency or any other commodity. I know everyone has seen the constant ads for gold on television. Who benefits most when gold prices go up? Is it the investor that has to pay a premium to both buy and sell his holdings? Or could it be the companies pushing the gold, that are collecting on both ends of the transaction? To keep it simple, suppose you could sell me something "worth" $10 and charge me $2 to complete the transaction. Then when I sell it back to you for $10, you charge me another $2 to complete the transaction. It doesn't matter how much the price of gold increases or decreases because you make all your money on the transactions. In other words it is nothing but a financial con game where the only steady winners are the gold peddlers. Bob

  • serfserf Member Posts: 9,225 ✭✭✭✭


    Gold peddlers can't make more gold unless they mine it.But fiat central banks can make more money digits by pressing a button on a computer with permission by a legislated body who gets paid off by lobbyist and corporations offerings of cheap stock investments to get on the ground floor investments which they voted for to grant a purchase for the government with taxpayers money.

    Gold is also currency between central banks so it's not a commodity.

    serf

    https://www.investopedia.com/ask/answers/042115/what-are-some-examples-pork-barrel-politics-united-states.asp

    • Pork barrel politics refer to the practice of politicians trading favors with constituents or special interest groups in exchange for political support.
    • Pork barrel politics benefits just one group of people, even though it's almost always funded by the larger community.
    • Typically, the practice relates to crony capitalism where the relationships between businessmen and the government are what determine success.



  • waltermoewaltermoe Member Posts: 846 ✭✭✭✭
    edited March 10

    I have bought gold in the past to protect against inflation, it has worked for me. But never have I bought gold on paper. Advantage of gold is you have to pay no taxes on profit or the gold it self, account of it’s sold and traded as a commodity.

    There is an old saying when it comes to gold, —- If you can’t hold it you don’t own it.

  • BobJudyBobJudy Member Posts: 5,385 ✭✭✭✭

    Serf, I have said before - your postings are interesting but you don't do your research. Gold is certainly a commodity. But don't take my word for it;

    Is Gold A Commodity Or A Currency? | BullionByPost

    Here is the research you should have done. Bob

  • serfserf Member Posts: 9,225 ✭✭✭✭

    If world central banks hoards it and transfer it to the IMF then it's currency Bob. Not a commodity. It' price floats in all currencies with restrictions so it is not a true commercial commodity. The USA dollar is toast now. The USA will/cannot finance it's debt very soon. Heck the democrats want another 1.5 trillion of debt from the treasury even now .

    serf

    The International Monetary Fund (IMF, the Fund), founded

    in 1945, is an international organization that works to

    ensure the stability of the international monetary system.

    The United States is a founding member of the IMF and the

    largest financial contributor. Congress helps shape the U.S.

    participation in the IMF through oversight, appropriations,

    and other legislation. Key issues for Congress include IMF

    support for Ukraine, possible IMF sanctions on Russia,

    China’s role at the IMF, and COVID-19 response efforts.

    The Bretton Woods exchange rate system prevailed until 1971 when the United States government suspended the convertibility of the US$ (and dollar reserves held by other governments) into gold. This is known as the Nixon Shock.[38] The changes to the IMF articles of agreement reflecting these changes were ratified in 1976 by the Jamaica Accords. Later in the 1970s, large commercial banks began lending to states because they were awash in cash deposited by oil exporters. The lending of the so-called money center banks led to the IMF changing its role in the 1980s after a world recession provoked a crisis that brought the IMF back into global financial governance.[43]

  • BobJudyBobJudy Member Posts: 5,385 ✭✭✭✭

    I don't think you grasp the concept of commodities. All commodities float in price due to demand and availability. If there is little demand no matter how rare something is the price goes down. If demand increases so does the price. This works with gold just as it works with oil or agricultural products.

    The IMF is under no obligation to service debt with gold. Gold is just one of the options for a debtor to repay their loan to the IMF. They also are forbidden to buy or speculate in gold. Gold is just one of the assets they hold. In fact they have been selling gold for currency to finance their operations and projects. Here is some info from the IMF concerning gold;

    Gold in the IMF

    Just a little more research that you can do when you have the time. Bob

  • serfserf Member Posts: 9,225 ✭✭✭✭

    You need to go live in Canada in fiat money paradise there Bob. In war time gold is the only exchange of medium for money until you know who the winner is. The money changers still use gold.

    Do you see The USA get any value of money for Old Chinese paper bonds when the British gave up Hong Kong and did get payed for their share of it? Nope!

    serf

  • BobJudyBobJudy Member Posts: 5,385 ✭✭✭✭

    Well that was a bit of a segue from the original topic. If you truly believe that China will cause a rapid and large increase in the price of gold, now is the time for you to buy some. If I were you I'd hold a few dollars back though, so you can actually participate in the economy by actually having an accepted medium of exchange.

    At this moment in history, there would be no way for the U.S. to back our currency with gold. With our countries debt at its current horrendous level all we would accomplish would be transferring all of our gold reserves to any country that holds that debt or U.S. currency. If we are a trillion in debt to someone, what is to prevent them from redeeming those debt payments made in gold backed currency for U.S. gold? As unpopular as it is to consider, we are a debtor nation. If you return to the archaic tangible asset backed currency days, you will not only crash our economy but the rest of the worlds as well. If we have an asset backed currency but have no assets, it will become worthless and we will have to return to the system we have now. It seems to me that you are advocating making the Yuan a universal currency by transferring all of our assets to China. Bob


    Oh, before I forget, you have used the term money changers quite often. Is it a biblical reference or a quote from Roosevelts inaugural address when he addressed the ongoing depression? Of course this is the same president who basically stopped the gold backing of our currency by forbidding the government exchange of currency for gold.

  • serfserf Member Posts: 9,225 ✭✭✭✭

    China has to hurry and dump all those U.S, Treasuries before The dollar devalues or hyper inflation hits and buy more farmland, and other commodities.

    The U.S. will be like Zimbabwe when China sell goods to other countries currencies with a better balance sheet.

    serf

  • Don McManusDon McManus Member Posts: 23,125 ✭✭✭✭

    There is between $12 and $13 trillion worth of gold total that is held by governments and people. Any suggestion of gold backed currency is not just impractical, it is laughable.

    Freedom and a submissive populace cannot co-exist.

    Brad Steele
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