Imagine, instead of using the US dollar, countries in the Global South accept the CNY which they can use to purchase gold stored in warehouses near them..... This gold can then be sold for USD which they can use elsewhere, but China will have cut the USD from its trade with these countries....Starting with South East Asia, which must surprise nobody.
And everybody knows how much gold China has been mining, buying and stockpiling. So much that nobody actually knows how much.
Perhaps gold is finally starting to become money again, not just a financial asset to be bought with money.
What this means for the price of gold I am not smart enough to divine, but the way things are going with China's trade plans, US government debt , impending WW3 and so on, it's hard to see gold declining to, and remaining at levels severely damaging to our investments.
I would not be thrilled, but I'd be comfortable if gold pulled back to US$3,000 but as Joel says, perhaps good buying opportunities are coming round especially if Trump continues to play nice and Bessent continues with his half truths. Probably through gritted teeth.
SPR Price at posting:
$2.07 Sentiment: Hold Disclosure: Held
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