Today, 12:30 AM
Today's presentation and explanation of what China has just done is brought to us by Andrei Jikh; just some guy who like to talk about money, global tensions related to it, and putting them together to help us understand how these things may affect us.
I will summarize as quickly as I can. Essentially China has shut down its paper precious metal retail trading. Those of us would better understand that as the Gold/Silver ETF's representing a physical allocation (allegedly) in brokerage accounts like Fidelity, Truist, Meryll Lynch, etc.. Anyways, they have only banned the paper trading, physical is still totally open for the retail investor/buyer. He will explain the fractional reserve concept applied to the metals market and how it leaves open to manipulation and how blown out of proportion it has become with the extreme leveraging. Margin requirements have risen to 140%, which means you already need to have one point four times in collateral just to borrow one.
There will be elaboration on China preparing for a gold-backed currency exchangeable for physical in a Hong Kong institution being setup. Explains the slow dumping of US treasuries, but also speculates based on statements from Scott Bessent (quoted and shown in video) about monetizing the US asset sheet of the over 8,000 tons of gold into the modern market price instead of the Nixon era $42 an ounce. This is alleged as a hedge against China's actions so that the US treasury bonds will also still be technically backed by the physical asset.
Some warning signs are:
I will summarize as quickly as I can. Essentially China has shut down its paper precious metal retail trading. Those of us would better understand that as the Gold/Silver ETF's representing a physical allocation (allegedly) in brokerage accounts like Fidelity, Truist, Meryll Lynch, etc.. Anyways, they have only banned the paper trading, physical is still totally open for the retail investor/buyer. He will explain the fractional reserve concept applied to the metals market and how it leaves open to manipulation and how blown out of proportion it has become with the extreme leveraging. Margin requirements have risen to 140%, which means you already need to have one point four times in collateral just to borrow one.
There will be elaboration on China preparing for a gold-backed currency exchangeable for physical in a Hong Kong institution being setup. Explains the slow dumping of US treasuries, but also speculates based on statements from Scott Bessent (quoted and shown in video) about monetizing the US asset sheet of the over 8,000 tons of gold into the modern market price instead of the Nixon era $42 an ounce. This is alleged as a hedge against China's actions so that the US treasury bonds will also still be technically backed by the physical asset.
Some warning signs are:
- US treasuries being sold off globally
- Gold reserves surpassing USD reserves in Central Banks and growing
- Money increasingly flowing out of speculative/leveraged ETF's and into physical allocation
