GOLDILOCKS
China has been selling their US Treasury Bonds and buying gold to create a diverse net worth of their holdings in gold. It has allowed them to decouple their economy from the dollar and begin a Treasury Bond Market of their own.
As of May 2024, gold makes up 4.9% of China's foreign exchange reserves. Central Banks have been buying gold at record rates around the world to achieve their Independence and Sovereignty.
The bond market plays an important role in the valuation of financial assets. The utilization of this financial tool will aid the countries who have moved through their Article 4 consultations with the IMF to achieve financial clarity and direction.
China intends to move into their Treasury Bond Market gradually. They intend to use this as a liquidity tool to help manage interest rates and move their monetary system forward through the support of gold as collateral instead of the dollar.
Other countries around the world are in process of doing the same. Over time, we will be witnessing an increase of exchange rates determined by each country's ability to collateralize their newfound level of Independence through gold as it deflates their inflating economies.
It is important for us to watch these new trends as they will create new valuations upon currencies that have been lying dormant for many years. These new local currencies being traded between nations going forward will soon be operating from their own strength and support through gold.
Gold will set us free.
© Goldilocks
https://www.morningstar.com/news/dow-jones/2024061979/bond-trading-by-china-pbocs-wouldnt-be-quantitative-easing-governor-says
https://www.investopedia.com/articles/investing/100814/why-10-year-us-treasury-rates-matter.asp#:~:text=Impacts%20Financial%20Markets,of%20future%20earnings%20is%20higher.
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