Gold $10,000 in currency reset as China
and Russia buy gold and overwhelmed gold futures manipulation this is the
important video update that we’re bringing you today. Hi I’m Mark O’Byrne
Research Director of your precious metal specialist and we think
it’s important to cover the recent developments of gold marketers in recent days,
some very significant developments one of which is Russia have sold nearly half
of their US Treasuries in just one month over forty billion dollars worth of US
Treasuries they sold in April and then they follow up by buying six
hundred thousand troy ounces of gold in May and this is a very important
development and as something that…Russia had been buying a lot of gold for many
years now. The gold reserves have gone from near 0% because they had very
little gold reserves to about, I think they’re about 17% of their gold reserves
are now. or sorry of their foreign exchange reserves are now in gold. So it’s increasing from
very near zero base, very low base and we believe the trend is very
very sustainable particularly given the increasing economic risks and
geopolitical risks in the world and huge tensions between the Western world and
the US with Russia. So this is a very important development. And then the second big
development is that James Rickards the well-known expert on monetary policy,
economic policy related to currencies and central banks and gold and
the expert on the coming global currency reset, he has issued a report
through Agora Financial Gold Speculator, basically saying that the IMF has
already pegged gold to the SDR that they are manipulating the marketplace in
order to create this peg. I think it’s 900s SDRs to one ounce of gold and
Jim just came out with this report recently and we think this is hugely,
hugely important. A lot of people have been talking about this currency reset
for for a long period of time and it looks like we are
slowly but surely seeing it come to pass. Why is this significant? Well I think
it signals that the the concerns many of us had about the US government and the
the indebted position of the US government which is going parabolic in
terms… if you look at the chart of US debt it is just going
vertical at this stage you know. It went up a trillion per year roughly
under President Bush II George Bush II “W” and then it went up one trillion per year
under Obama. And just in the last 18 months it’s gone up another…. it’s up to
twenty one point two trillion basically. So I mean while the the foreign
exchanges of the world, the entire global savings the world are essentially
flatlining and so ultimately the dollar is gonna devalue versus gold and the
question is how does that happen? Does it happen in a disorderly manner
or does it happen in a more organized manner involving a currency
reset? So the Russian gold demand is very very important it’s not just Russia it’s
a lot of emerging market nations, large creditor nations have massive US dollar
reserves and and they are basically diversifying into gold.
Turkey, Kazakhstan otherer former Soviet block nations and we believe the trend is
very same because, they have, still have very small foreign exchange
reserves and vis-a-vis their overall reserves and it’s worth remembering that
the US is the biggest holder of gold in the world today with 8100 metric tons
which are alleged to be held in Fort Knox and the New York Federal Reserve
they haven’t been audited since the 1950s so it may or may not be there,
that’s yet to be proven but they have putatively
reported they have 8100 tons and the ECB and the euro area banks have over 10,000
metric tons so that’s 55 percent of the euro area
central bank reserves are actually in physical gold. So we believe this trend
is very very in its infancy in effect and it may accelerate given the degree
of economic and geopolitical tensions in the world so it’s a very important trend
and the elephant in the room is China. China is quietly buying gold, the People’s Bank
of China’s it is believed is quietly accumulating gold and they have only
reported 1000 I think roughly 1850, 1900 metric tons. But we believe that
they will announce in the coming months and years that they have increased the
reserves to 4,500 o 5,000 metric tons
and I think that might be the signal to much much higher gold prices. And it’s
important to consider that the context here and the context is a very, very
small physical gold market, so all the world’s gold, all the world in the… all
the world in the gold, all the gold in the world that’s ever mined since the
dawn of time will basically… if you refine it you make it into one giant
cube. It would be 21 meters cubed. It would fit on the central court at
Wimbeldon. It would be 2 Olympic swimming pools. So gold is much much rarer,
physical gold is much more rare than people realize and there are roughly….
there’s different estimates but there’s roughly 80 to 100 claims on every one
ounce of gold in the financial markets and in the futures market the
leverage is roughly eighteen ninety to one. So gold is very rare and therefore
when you see large central banks, the largest creditor nations in the world
such as Russia and indeed China and China’s the elephant in the room in this
regard, diversifying into gold, all it takes is a little bit of diversification
from their foreign exchange reserves into physical gold to result in much
much higher gold prices. China has over 3 trillion of US dollar
reserves Russia has over nearly a half a trillion
or like 450 billion it is yeah 450 billion I just checked that before I came on.
450 billion, they’ve half a trillion and the amount gold they bought recently, the six
hundred thousand troy ounces that that only amounts to something like 750
million so it’s tiny vis-a-vis the amount of foreign exchange reserves they have so I
believe that this trend, given that the huge geopolitical tensions and economic
and trading tensions, I think that they will now resort to accelerating their
diversification out of US Treasuries and into gold and I think that will result
in the US in time having to revert to quantitative easing. It has huge
ramifications for the bond market for risk assets in general and I think it
will actually ultimately overwhelm the manipulation of gold that we’ve seen in
the futures market in recent months and years. A good way of thinking about this
manipulation of the gold market is a bit like
a beach ball, that image of a beach ball being pressed down underneath the water,
pushed down towards the bottom of the sea the more you push it down the more it’s
gonna bounce out of the water and shoot much much higher and we believe that’s
because it’s been artificially suppressed and we believe that’s what’s
gonna happen to the gold price in the coming months and years we’re going we’re
gonna go much, much higher. Obviously the currency reset experts and
many more talk about gold at ten thousand dollars per ounce, ultimately
nobody knows what price it will go to, it will go to five thousand, ten thousand,
twenty thousand dollars nobody knows and and we shouldn’t be focused on the price
and trying to predict exactly what the price will be per se it’s more the value
and the value is when we see as currency reset, we’re going to see problems in the
bond markets we’re gonna see problems with risk assets and you’re going to see
basically ultimately currencies, fiat currencies are gonna be devalued
in a very, very significant way, so it’s important that you own physical gold to
hedge yourself against these risks ,very real risks and yeah physical gold is,
there’s no point, gold is a safe-haven asset, it’s only a safe-haven asset if you own it in
a very, very safe way. So the manipulation will end as it always does gold prices
below $1,250 per ounce will be looked at as an absolute gift in the coming months
and years so we advise people if you’re gonna
diversify into gold time is of the essence, you know that this is going to
happen we may be in the early stages of a currency reset happening as Jim
Rickards is alluding to, so so yeah get positioned, get gold, own gold in
the safest way possible and you will be hedged against these risks. And you can
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I’m Mark O’Byrne. thanks your time today and take care of yourself bye bye