A Sign of Things to Come: China Adds 1,853 Metric Tonnes to "Official" Gold Reserves

By Nathan McDonald 

Jan 11, 2019

While Westerngovernments continue to ravage each other viciously, seemingly unable to cometo terms on even the simplest of agendas, the East, led predominately by thefinancial juggernaut that is China, continues to chug along, slowly but surelycarrying through on their long term plans.

While we lookinward and fight among one another, becoming increasingly polarized andisolated into our various political "camps", ceasing any form ofcommunication with each other, our economic rivals are racing past us, formingpartnerships and making plans.

Russia and Chinaare two such countries that I have often talked about in past articles,highlighting how the West has forced these two countries into a partnershipthat threatens to overtake the West as the economic powerhouse of the world.

While ourfinancial "gurus" continue to shuffle pieces of paper back and forthbetween each other, trading digital numbers in ever increasingly quantities, asif they had any real, true intrinsic value.

Russia and Chinaare happily making moves around the world, acquiring physical, tangible assetsthat will play key roles in the coming economic conflict that the world willinevitably face at some point in our not too distant future.

Although theirdemand for oil, rare earths and various other forms of assets is seeminglyinsatiable, there is one asset class above all others that I am particularlyinterested in, precious metals.

Both countrieshave made it blatantly obvious that they are not happy with the current"status quo" and would love to see an eventual change. That changebeing a toppling of the US Dollar as the reserve currency of the world.

This has led to arapid accumulation in precious metals by Russia, who have forecast theirpurchases on an almost monthly basis.

Meanwhile, China,who has remained tight lipped about their gold purchases since 2016 has onceagain made another power play, announcingan increase in "official" gold holdings, a rare occurrencefor them.

Adding 1,853metric tonnes of the yellow metal, Chinese reserves now stand at a staggering59.26 million ounces, but why now, why after two years of remaining silent, andthen six years before that, have they now decided to let the world know thatthey are continuing to diversify and move into precious metals?

Simply put, itwas a warning.

As the trade warsbetween the United States and China rage on, the latter is simply flexing theirmuscles and letting the former know that their long term intentions remain thesame.

They plan onovertaking the US Dollar, and mounting the Yuan proudly as the reserve currencyof the world, with gold playing a crucial role in that scenario.

Recently, theGovernor of the Bank of England, Mark Carney, who is closely connected withsome of the most influential bankers in the world had a similar assessment.

Reuters reports;

Carney saidChina’s yuan could potentially become a future global reserve currency alongsidethe U.S. dollar, though this was likely to lag behind the increase in the sizeof China’s economy relative to that of the United States.

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“The U.S. economy overtook Britain’s in the second half of the 19th century,but it took until the 1920s before it became a dominant currency ininternational trade,”

As he states,none of this is going to happen overnight, as no one, not even those who planto take the throne want to completely over tip the "apple cart",there is simply too much on the line and too much to lose.

Still, thewriting is on the wall and this recent announcement is just one more piece ofthe puzzle.

The trade warswill rage on for years to come, as both sides continue to make moves and jostlefor position, with one side hoping to remain in power and the other to gain theupper hand.

Regardless of theoutcome, there is one solid and clear winner in this scenario of countlessloser, gold and by extension, precious metals as a whole. Keep stacking, keeppreparing.

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