Why is China creating a stockpile of gold and what is the consequence to the United States?
After WWII, the Germans sent their gold to the United States for safe keeping. They feared Russia would attack and seize their gold. They sent gold bars to the Federal Reserve with their seal of identification on it.
Last year the Germans asked the Federal Reserve ( the Fed) for their gold and they responded by informing them that they could not have their gold. So the Germans asked to see it and the Fed, again, said no.
The Fed ended up sending a fraction of what the Germans requested, but it was not the actual gold that the Germans sent to the Feds because it didn’t have their seal on it.
So what is the significance of China hoarding gold?
Their plan is to replace the U.S. Dollar with their Yuan as the world reserve currency.
And very soon, maybe even as soon as this year China is going to reveal their gold and demand that the United States also reveal their gold to the world.
What will that do to the status of the Dollar?
It could start the end of the U.S. Dollar as the world reserve status and mark the beginning of Yuan as the world reserve status. This could actually take years to complete.