1/nChina if it survives its economic problems now they will be on a gold standard when it’s done. the reason to buy all that gold is to back the yuan as an SOV. They’ve already printed that yuan for their economy.
2/nThey just need to make sure that it’s backed by something other than Treasuries as a reserve asset. If they get this right when they come out of the box financially, it’ll rock the world.
3/n The bricks are begging them to internationalize the yuan so they can do more non-dollar trade in their half of the world.
4/n China has been reticent to do this for decades, because coming out is risky historically for the Chinese. How do you come out and protect yourself simultaneously?
5/n You need to reserve asset to replace US treasuries and you can’t really use your own bonds as a global asset because it’s not global yet it’s a chicken egg thing.
N/n you need a bridge off the dollar off of Treasuries and onto whatever it is you’re going to do with your own economy over the next 50 years you need something that’s already excepted as stable. That’s already a store value and nobody questions it’s loyalty. That’s why China is already on the gold standard.
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