China has held the world’s largest amount of US debt, larger than any other nation. However, things are changing drastically. China has changed its investment strategies, including exiting a majority stake in dollar-dominated assets and converting those assets into gold. It clearly doesn’t take a financial genius to figure out the logic behind China’s dollar exit strategy.

Uncertain euro

While the US dollar may still be king over an uncertain euro today, what will happen when the US is reminded that its debt exceeds Greece’s by gold ankauf comparison? Although China is still the largest holder of foreign dollar reserves, it is acutely aware of how exposed its holdings are, which is plunging its country’s reserves into a slump. US Treasuries are currently in the biggest market bubble in history.

Protecting your wealth is important, as is diversification; But should most of your wealth be tied up in US Treasuries? Where else can you find safety? Swiss francs used to be an excellent hedging investment. However, the franc is pegged to the euro today to halt or slow down its appreciation because things are totally out of control.

If you happen to be from India and hold your wealth in gold instead of rupees, then you are the one laughing. Gold is at record highs as measured by the massive devaluation of the Indian rupee. Even if it’s several hundred dollars below its dollar-denominated peak set back in the last quarter of 2011. The Chinese have also benefited from these courses.

There are few true safe havens left in the world today. There is increasing financial market manipulation by central banks around the world. Because the central banks have the greatest possible control over the global supply of paper money. Gold and silver prices can also be manipulated and suppressed through direct involvement of the gold banks through conspiracy tactics.

Precious metals

However, as physical demand for precious metals grows, the manipulations on a global scale will continue to ease and eventually come to an end. Because eventually the manipulators will be unable to withstand the pressure of massive physical precious metals beyond their control. Thus, the global manipulations and the entities behind them will implode.

Imagine the US economy and what it would look like if its interest rate were set at the same 6 percent level as Italy. The values within the asset classes of stocks, bonds or real estate would all be wiped out. At that point, a dangerous deflationary depression would emerge. However, no one is seriously considering this situation right now, a scenario that could realistically happen. Global economies have been lying in wait; on life support since the beginning of the global financial crisis. While more life support is needed as economies continue to fail.

The Chinese have skillfully and systematically piled gold and silver into their treasury with the vision that tomorrow a severe economic event will emerge. Today they buy physical gold and silver to serve as an insurance policy against a worst-case scenario, tomorrow’s economic ills.

The severity of the eurozone’s mishandled sovereign debt crisis is a catastrophic problem today. It could be seen as a best case scenario for other nations and people to learn from and see where the future might be heading. America is not far behind Europe, actually in worse shape there, soon the US will be in similar but bigger troubles. Follow in China’s footsteps; Invest in precious metals today to secure your wealth tomorrow.

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