Chinese policies are now actively promoting GOLD as new means of asset ownership. This is shift from real estate as primary asset on Chinese household balancesheet.. as 70% of Chinese household wealth is concentrated in real estate.
This is also the reason that Chinese HH consumption continues to be weak because if the one asset on your book continues to go down in price then you don’t feel like increasing your consumption.
Chinese yuan is down 30-40% against GOLD from the time Chinese govt has started actively promoting GOLD as investments.
The more GOLD rises in Chinese yuan .. the more Chinese HH balancesheet will get repaired and more demand for Gold will go up from Chinese HH.
This change will also happen in countries which export to US but are now uncomfortable holding US treasury bonds or USD in their reserve holdings… because US has no choice but to inflate away its debt.
India recently cut down the custom duty on gold/ silver imports to promote Gold silver investments by Indian HH ( just for info Indian HH currently holds 25000 tonnes of Gold whose value in this year alone is up by 500B USD.. liquifying Indian HH B/S) … that also means that India is ok running increasing CAD if it happens due to Gold imports.
Times.. they are changing … west is slow to react and by the time they realise.. gold would have completely shifted to East from west.
Learn from history.. Gold is returning to monetary system as neutral reserve asset …..the one who owns the Gold makes the rules.
This is also the reason that Chinese HH consumption continues to be weak because if the one asset on your book continues to go down in price then you don’t feel like increasing your consumption.
Chinese yuan is down 30-40% against GOLD from the time Chinese govt has started actively promoting GOLD as investments.
The more GOLD rises in Chinese yuan .. the more Chinese HH balancesheet will get repaired and more demand for Gold will go up from Chinese HH.
This change will also happen in countries which export to US but are now uncomfortable holding US treasury bonds or USD in their reserve holdings… because US has no choice but to inflate away its debt.
India recently cut down the custom duty on gold/ silver imports to promote Gold silver investments by Indian HH ( just for info Indian HH currently holds 25000 tonnes of Gold whose value in this year alone is up by 500B USD.. liquifying Indian HH B/S) … that also means that India is ok running increasing CAD if it happens due to Gold imports.
Times.. they are changing … west is slow to react and by the time they realise.. gold would have completely shifted to East from west.
Learn from history.. Gold is returning to monetary system as neutral reserve asset …..the one who owns the Gold makes the rules.
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