allan skye

China's Gold Reserves Almost Doubled

Firstly,Uk only has around 400 tons of gold which is at least half of chinas gold so I hardly think that selling that 400 tons is likely to make sterling stronger.With regard to USA if 8000 tons represents approx 80% of USA reserves and China with approx 1000 tons represents around 2% of its foreign reserves then we are in a position wher china(and/or Japan ) can buy every bit of gold USA has to sell-even better if the price falls a bit in the process for them because when the dust settles China could buy all of USAs gold reserve and that would still comprise only approx 16% of chinas reserve.Then where do you think the dollar would be? answer -down the pan,while chinas currency would be numero uno.So selling gold would be a massive blunder for USA and would in fact be end game for USA.


On Apr 24 06:13 PM History Buff 24/7 wrote:

> vishal0soni,
>
> In the olden days countries held on to gold to make sure their currency
> was strong (i.e., backed by something). Even today, selling gold
> is not likely to make their currency any stronger, especially considering
> the currency is backed by NOTHING.

Gold Is Going to Gain

excellant piece Preston.

Is the Gold Rally Really Over?

One more point on the subject of printing copious quantities of new money .Could this be seen as a form of taxation in two ways1Someone is paying interest to(the government?)or quazi governmental body on all this new money that has just appeared from nowhere2By the devaluation that follows old people ,children and other trusting people are getting heavily taxed by the value of their savings declining.Its a double whammy.If we start to look at the finance houses and banks as an extension of the state or essentially part of the state then the proportion of gdp raised and spent by the government rises dramatically into the realms of sociallism and we all know what happens to socialist(command)econ... is a lot more than a financial crisis it is a crisis in which the size of the state is increasing to unsustainable proportions and complete collapse looks possible in the medium term,similar to the fall of the soviet union.

Is the Gold Rally Really Over?

Gold is a store of wealth(ie surplus resources) during financial meltdown,irresponsible fiscal policies,war and other forms of instability.You may not be able to buy gas or groceries with gold right now but were the potential total collapse ever to occur you can be sure gold would get you whatever you wanted before dollars or anything else made of paper.Paper is only a promise and is not worth anything if the promiser is unable to deliver the promise.Gold however is a physical substance that you can carry around in your pocket and wont evaporate during times of upheaval like for example paper money,share certificates etc.Once the upheaval is over ,sure the price of gold will drop but youll still have the gold for the next upheaval if you keep it.It is liquid internationally and Im sure that you could buy any larger asset with gold anytime any place worldwide.