China Stacking Gold To Fight Dollars?

[Asuspawer09]

We can already see that the gold market has been having a lot of movement in the past months, and it's been in a lot of articles already even though it is just a theory for now there a lot of evidence already that we can see that is going to support this, where China is secretly buying gold or stacking up gold not to mention the Shanghai Gold Exchange which is now the biggest physical exchange of gold in the World, which is probably connected to why the market is so high for gold.

This topic got my attention since we've all been eyeing on Bitcoin and cryptocurrency because a lot of countries and already starting to implement it, like having a Bitcoin or cryptocurrency reserve, which surely hype the market, and as we can already see market is even reaching new highs and Bitcoin is reaching up to $126k, which is a time high. Not saying that this was a bad move, but in times like these, greed could easily consume a lot of the country, since we are all on cryptocurrency. China is buying gold, which could change our perspective again. Probably a lot of us see, I mean, Gold is a physical asset compared to Bitcoin, and for a safer investment, I would choose Gold over digital currency.

For a long time Dollar is just on the top of the currency thats why a lot of country trusting it, even though it is just trust since technically it wasn't something that they own since US can easily freeze it, but for China's plan of backing up Yuan of gold could be a game changer since this was a physical asset, it is not something that can be printed like Dollars, which is easily affected by inflation over time.


https://x.com/A_K_Mandhan/status/1979807258809954372

If this China plan works, it is surely going to affect a lot of things, like rates, commodities, and, for sure, even the cryptocurrency market. What can you say?

[Fortify]

War. China wants Taiwan and is trying to isolate itself from the economic fall out that will happen when it invades. The fact that Trump is in power and being very confrontational with them is another important ingredient in the mix, but one with more volatility that Xi Jinping is less able to predict.It's the same sort of scenario that Russia enacted in the build up to invading Ukraine, except all their massive reserves are long gone now and the remainder is frozen under sanctions. China was previously the largest buyer of US debt but when you have a president that is hostile to you, then you have to understand why they are wanting to offload. However whenever I see a graph like that it is often proceeded by a sharp fall the opposite direction, as it's far from a normal situation, you just don't know when it'll hit.

[Ambatman]

If this China plan works, it is surely going to affect a lot of things, like rates, commodities, and, for sure, even the cryptocurrency market. What can you say?

That they are not planning to make their currency backed by Gold since that was used in the past
And failed for a reason.


And yes they are diversifying to Gold to limit their reliance on USD as can be seen on how their
Dollar reserve has fallen from around 59% to 25% this year and it keeps going down.
With the coming tariff war and geopolitical crisis, Gold is a safer bet.

Gold is a physical asset compared to Bitcoin, and for a safer investment, I would choose Gold over digital currency.

I would say for  Less volatile or relatively risky investment not safer.

[STT]

Dollar is obviously biased not just to the west but the largest super power USA and opposes alot of the China nonsense like claiming every country in the south China sea is now their terrority and other moves towards another world war.
  China has accumulated gold since the beginning of the century, its not in any way a new policy.  What might be new is that people increasingly realize their end game, the giant extent of their buying is hard to cover though it was there for years for those paying attention.

China is the largest buyer, they are the largest producer.  China buys entire gold mines that became unprofitable in the sub 2000's era knowing full well the price of gold would rocket if they had revealed their buying.  They take up positions in African nations even europe knowing a large benefit is due with future prices they control.  Gold is vital to that control, Russia has done similar with its war in europe relying on oil and gold both highly tradable commodities outside and around the Dollar.
  The worst thing is the lax regime and poor debt control behind dollar, the abandonment of the Bretton woods system makes its failure quite inevitable.  The IMF in theory has some replacement for Dollar but that is yet more FIAT based weak currency and I doubt it will take the weight in any future upset to the global reserve system.

[pooya87]

It is not just China, any country with a government that has a brain has been buying gold for the past 2-3 years. I first saw the signs in 2022 myself: [1] and [2].

It is the result of the instability in the world and the WW5 that is going on. Not to mention that as more and more countries dump the worst currency of all times called dollar, they replace it with what can be trusted which is gold.

This is all going to be good news for bitcoin as well. Because when the dollar dumps, bitcoin thrives.

[o48o]

-cut-
What can you say?

What would this have to do with the fight against dollar? Reserves are important tool for economy stabilization as "buffer money", and gold is the safest asset for that.
Only way to fight against dollar is by building a strong economy, and that doesn't happen by focusing on reserves but building their gross domestic product.

Also, when it comes to bitcoin reserves, putting too much power hands of governments isn't a good idea imho. Individual whales weren't a good thing either, as it just creates more leverage for manipulators.

[bangjoe]

Countries that have concerns that global conflict will result in head to head war with armed forces will disrupt the current world system, especially the tensions between China and the US which are increasingly swelling in trade, this cannot be avoided and is very difficult to control, where these two countries are superior countries, have the power to act decisively, unlike large conflicts with small countries which are often not considered to have a major impact on the economy in the world, and yes China  have realized that saving dollars is the same as committing suicide, because inflation is out of control, therefore many people and countries prefer buying gold rather than having lots of dollars, gold has become something that is very vocal in maintaining sovereignty and will remain valuable.

[Synchronice]

It is not just China, any country with a government that has a brain has been buying gold for the past 2-3 years. I first saw the signs in 2022 myself: [1] and [2].

It is the result of the instability in the world and the WW5 that is going on. Not to mention that as more and more countries dump the worst currency of all times called dollar, they replace it with what can be trusted which is gold.

This is all going to be good news for bitcoin as well. Because when the dollar dumps, bitcoin thrives.

Don't United States, Germany, Italy and France (all of them US allies) hold the most gold reserves? The US alone basically has 2.5 times more gold than China. My point is that, since western countries are leader in holding Gold, why is it the best step for China to buy more Gold? They, even with the BRICS, will not be able to hold more gold than the western countries hold together.

Not only instability but in general, it's stupid to hold a currency that can be printed out of thin air in as much quantity as wished, especially when it's controlled by a foreign country.

[tsaroz]

US Dollar or US Treasury bills are no longer a trust asset. US has shown that it can freeze your asset in dollar anytime if it find you not obeying it. The Euro was no different and no countries are trusting another fiat so they are moving towards something that is globally accepted in any form and can be held physically. Even if you have USD bills, you are not the real owner but when you have bricks of gold, you are the true owner.
This is also a decoupling of China from US economic circle, US is already trying to corner China, and when they have been cornered enough, there are no reasons not to go with a Taiwan invasion which would surely bring a US asset freeze. So, it can also be seen as preparation for a war in Taiwan.

[karabiber]

China is one of the countries with the largest dollar reserves. However, the inflation and cost of the dollar are increasing over time. Accumulating gold has always been a more advantageous situation for states. In today's world of regional wars, states actually want to increase their economic power and flex their military muscle by accumulating gold. The increase in war rhetoric is actually driving countries to buy gold.

In the event of a potential war or crisis, physical gold is indeed more valuable than Bitcoin, but Bitcoin is not an instant investment vehicle; it is a result of changing payment systems and monetary systems. China's gold accumulation is affecting global markets. This will continue as long as China does not change its strict stance on cryptocurrency markets.

[Ishicryptic]

From your point of view about China, stacking gold to fight US dollar, it means that they want to do everything possible to break the shackles of overeliance on the US dollar in global trade, commerce and as a reserve. We can only speculate what their main intentions were for stacking tones of gold but if it impacts positively on their economy which I know it does then they are on the right track. I personally think that having gold as reserve is better than the US dollar, gold is scarce and a store of value unlike dollar which is controlled by the US government and can be reprinted by them anytime they want.

[WillyAp]

China is shorting the US Dollar

China’s use of foreign exchange (FX) swaps to support the yuan has exposed the country’s state-run banks to potential losses totaling billions of dollars, while offering hedge funds and foreign institutions significant profits. Since last year, Chinese banks have used FX swaps to short the U.S. dollar, accumulating positions exceeding $100 billion.

https://www.nasdaq.com/articles/chinas-100-billion-dollar-short-hands-hedge-funds-big-profits

Looks like a old grudge between both.

[rdluffy]

I posted this some days ago:



Source https://www.scmp.com/economy/china-economy/article/3328200/chinas-central-bank-aids-golds-record-setting-run-11-month-buying-streak

China is not only buying gold, they are buying TONS of gold
They obviously want to be prepares for hard times, but I'm sure they are thinking of having anything like BTC too

[Akbarkoe]

Gold has been used as a currency for centuries, FIAT is western logic which is a certificate of ownership of gold, how FIAT is separated from the gold standard is the responsibility of the US government, if I'm not mistaken it was done during the era of President Nixon and that's why the paper is considered valuable but in fact it's not at all, China thinks that gold is the only decent currency and will not change its value significantly, when the Chinese currency is attacked they have gold as a hedge.

My abstract thought is that when FIAT is no longer trusted, it is very likely that when China has enough gold supplies, it will pioneer the world to use gold again in its transactions. This can make sense and those who have a lot of gold will become super power countries with strong economies in the future if gold is again recognized as the world currency and discards the dollar.

[Franklyn-wood]

It is not just China, any country with a government that has a brain has been buying gold for the past 2-3 years. I first saw the signs in 2022 myself: [1] and [2].

It is the result of the instability in the world and the WW5 that is going on. Not to mention that as more and more countries dump the worst currency of all times called dollar, they replace it with what can be trusted which is gold.

This is all going to be good news for bitcoin as well. Because when the dollar dumps, bitcoin thrives.

I'm afraid because we could see the USD supremacy dropping to the floor because I know that China has taken too many shits from the United States and her authoritarian regime. This is not going to be fun at all because it is going to lead  to great consequences and hyper inflation that could reduce the livelihood of an average American citizen.

[WillyAp]

This is all going to be good news for bitcoin as well. Because when the dollar dumps, bitcoin thrives.

Really how many veggies have you bought with bitcoin?
Not the sats exchanged against de US$.

Delusional one could say.

After the euro's share of global official foreign exchange reserves approached 25% as of year-end 2006 (vs 65% for the U.S. dollar; see table in Reserve currency#Global currency reserves), former Federal Reserve Chairman Alan Greenspan said in September 2007 that it is "absolutely conceivable that the euro will replace the dollar as reserve currency, or will be traded as an equally important reserve currency"

The U.S. dollar is predominantly the standard currency unit in which goods are quoted and traded, and with which payments are settled in, in the global commodity markets.

Source: https://en.wikipedia.org/wiki/International_use_of_the_U.S._dollar

[stompix]

Gold has been used as a currency for centuries, FIAT is western logic which is a certificate of ownership of gold,

Bruh, for god's sake, China used paper money that was backed by nothing since 3000 years ago, they experienced inflation and decrease value of those notes as well as ban on actual conversion to silver and gold before Rome was built!
Western logic?  Even if we ditch ancient history China launched the fabi in 1935 and replaced the silver standard, that's a decade before!! Brenton Woods !!!!!

[Akbarkoe]

Gold has been used as a currency for centuries, FIAT is western logic which is a certificate of ownership of gold,

Bruh, for god's sake, China used paper money that was backed by nothing since 3000 years ago, they experienced inflation and decrease value of those notes as well as ban on actual conversion to silver and gold before Rome was built!
Western logic?  Even if we ditch ancient history China launched the fabi in 1935 and replaced the silver standard, that's a decade before!! Brenton Woods !!!!!

Thank you for reminding me of this history. Yes, China was the first nation to have paper money. If I recall correctly, it was during the Song Dynasty that paper money became widespread in China. Yes, they tied it to silver, but it suffered from hyperinflation. Then they tried gold, but it still didn't work due to the high inflation. Then they replaced it with the RMB, claiming better monetary control.

However, as time moved on, the US gained significant influence in global finance, and they played it very well, the dollar doctrine spread throughout the world as a global currency or foreign exchange. That's why I mentioned it.

China is very aware of its power and always wants to break free from its dependence on the dollar. As we know, China has undertaken many initiatives, such as conducting international trade with local currencies. Instead of breaking free from dependence, they have a larger mission: consistently accumulating gold. They must seize significant value to gain power and trust.

[Alpen]

China is accumulating gold with the goal of eventually reviving the gold standard. It's the same strategy that once made the US dollar the world's reserve currency.

The next step in their plan is for a gold-backed yuan to become the new global standard, and when that happens, everyone will forget about Bitcoin.

[pooya87]

It is not just China, any country with a government that has a brain has been buying gold for the past 2-3 years. I first saw the signs in 2022 myself: [1] and [2].

It is the result of the instability in the world and the WW5 that is going on. Not to mention that as more and more countries dump the worst currency of all times called dollar, they replace it with what can be trusted which is gold.

This is all going to be good news for bitcoin as well. Because when the dollar dumps, bitcoin thrives.

Don't United States, Germany, Italy and France (all of them US allies) hold the most gold reserves? The US alone basically has 2.5 times more gold than China. My point is that, since western countries are leader in holding Gold, why is it the best step for China to buy more Gold? They, even with the BRICS, will not be able to hold more gold than the western countries hold together.

Not only instability but in general, it's stupid to hold a currency that can be printed out of thin air in as much quantity as wished, especially when it's controlled by a foreign country.

It's not a competition of who owns the most gold! It is a matter of increasing amount of a valuable hard asset in your country's vaults to protect your economy against the turmoil on a global scale as much as possible. It also helps by holding an asset with limited supply as opposed to fiat that keeps being printed these days (hint: $38 trillion US national debt).

Also correct me if I'm wrong but US regime ran the Bretton Woods scam for many years before the world learned they don't have the amount of gold they claim to have...