Dragon Rising: China’s Gold Will Break World’s Dependence on US Dollar

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Dragon Rising: China’s Gold Will Break World’s Dependence on US Dollar

China can ultimately overthrow the US dollar domination using its 30,000 tons of gold reserves, according to Chinese economist Jin Zihou.

Citing former US Federal Reserve Chair Alan Greenspan, Chinese economic observer Jin Zihou suggested that the Chinese renminbi would deal a lethal blow to today’s financial system if Beijing converted its $4 trillion assets into gold.

Since the US dollar’s power is gradually fading, China, the US biggest creditor, may potentially destroy the US dollar, Jin emphasized.

Still the US dollar remains the “biggest player,” accounting for 60 percent of global reserves. However, many countries are seeking ways to limit the power of the US dollar and become less dependent on it.

According to Jin Zihou, the only way for Beijing to end the US dollar’s reign is to accumulate a significant amount of gold, namely 30,000 tons. In this case, China will be able to challenge America’s longstanding dominant position in the global trade and financial markets.

“Since 2002, the Chinese state has almost certainly acquired by these means a further 5,000 tons or more,” the expert suggested.

He elaborated that by liberating public gold ownership in 2002 and forming the Shanghai Gold Exchange, Beijing has reduced the need for currency intervention to halt the renminbi rising.

“Therefore the Chinese state has probably accumulated between 20,000 and 30,000 tons since 1983, and has no need to acquire any more through market purchases given her own refineries are supplying over 500 tons per annum,” the expert emphasized…..More Here

 

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