Wednesday, June 13, 2018

As the U.S. suppresses gold prices to protect the dollar, it has allowed Russia and China to boost reserves that might actually one day kill the reserve currency

Perhaps one of the biggest ironies in the U.S.'s  monetary policies has been the ongoing suppression of the gold price by the central and bullion banks to limit gold's power in exposing the dollar.  But in doing so through the paper markets, it has also allowed their financial competitors in both Russia and China to purchase massive amounts of the metal at discounted prices.

And in the end, their stockpiles of gold could one day be the very thing that destroys the dollar as the singular global reserve currency.

Efforts by the US to suppress gold prices in order to prop up the dollar are allowing Russia and China to build up huge reserves of physical gold by purchasing large quantities of the precious metal at significantly lower prices. 
Net central bank purchases in the first quarter of the current year surged by 42 percent compared to the same period a year ago, totaling 116.5 tons, according to data compiled by the World Gold Council (WGC). The number reportedly represents the highest quarterly total since 2014. 
Over the past two decades, Russia has been ramping up the purchases of physical gold. In May, the country's gold reserves surged to 1,909 tons, Russia's Finance Ministry reported. Since 2000, the country’s gold reserves have surged by 500 percent. 
China and Russia, along with Turkey, India and other countries have been aggressively accumulating gold reserves in a bid to diversify their reserve financial assets from the greenback that currently serves as the global reserve currency. – Russia Today

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