2024-03-22 16:23:43
With the price of an ounce of gold reaching about $2,200, its highest historical level, information coming from the markets indicated that China was the one that bought the largest quantities of gold last year, in addition to Russia, Turkey, the Gulf states, and India.
Published on: 03/22/2024 – 17:23
1 minutes
Talk has begun again about the dollar losing its dominance in the global economy as a reserve currency and a commercial trading currency, and the latest of that was the comment of Peter Schiff, a financial strategist on Wall Street, who is convinced that the major central banks in the world are preparing to return to a global financial system based, essentially, on gold as well. it was in the past.
Schiff believes that if this happens, the United States will face a major dilemma, because a development of this kind will reduce demand for the dollar and for American sovereign debt, especially since the American gold reserve does not exceed 10⁒ – and perhaps less than that – of the monetary mass in dollars in years. Last.
Many economists say this, especially since the 2008 crisis and after the Covid crisis, but what has been observed, so far, is that the dollar has not declined despite the rise in gold, and this means that this matter is still unlikely in the short term.
The reason is simple, which is that all the major countries in the world and their economies are currently suffering from severe economic crises. The other reason is that returning to fixed currencies in exchange for gold will necessarily lead to a major and dangerous economic contraction in the current circumstance, because the volume of monetary supply and loans will decrease together.
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