China’s Gold Buying Is Surging — Is a New Gold Standard Coming?

Gold still represents the ultimate form of payment in the world. Fiat money in extremis is accepted by nobody. Gold is always accepted. Monday, July 20th, 2026. Monaco 64. Home of alternative economics and contrarian views. Well, I've noticed that there's a lot of interest in this July 24th deadline that China has placed on retail accounts to close out their leveraged or futures positions in gold. And I think, unfortunately, what's happening vis-a-vis Iran is just a symptom of that. It's the last ditch effort by a waning empire, i.e. the U.S. or Western Empire, to keep control of things. And it's not going to get better. It's also kind of a proxy attack on this BRICS architecture. It's a proxy attack on the One Belt, One Road initiative by China, Russia, and the Global South because Iran is very strategically important in the scheme of things geographically for the One Belt, One Road. And the reason why gold is so important is because, yeah, in a world where there's no cooperation, fiat money becomes very fickle. People don't accept it. And I'm going to quote the late Alan Greenspan. He said the following, gold still represents the ultimate form of payment in the world. Fiat money in extremists is accepted by nobody. Gold is always accepted. Why is that? Well, because fiat money is only a promise made by governments, and fiat money can be controlled a lot easier than physical gold in your possession, as we've seen. Of course, with Russia, the last four years, their reserves, fiat money reserves, have been frozen. It's very difficult to freeze Russia's gold if they're holding it in Moscow or other places in Russia. Of course, Venezuela has learned the hard way because they still have some gold with the Bank of England, and they basically confiscated that. They basically said you can't have it back. Chavez, though, back in 2011, he repatriated almost 100 tons. And I don't think the globalists were very happy about that because he passed away less than a year later of cancer. But back to the main topic of China. Yes, I got a lot of questions last night in the live stream. And actually, I'd like to thank all of you for coming on the live stream. It was a good live stream, despite the fact that we started at the same time that the final match of the World Cup started. But yeah, a lot of you are interested in this July 24th date. Do I think gold is going to go through the roof and silver going to pick up after that date? Not necessarily. They might go up and it might be related to other things. But what it tells me is that China is preparing maybe not 100 percent for a gold standard, but it's preparing for more chaos, less cooperation with the West, more potential for conflict. Because, as I said, I think the United States and the West, they're fighting for supremacy. I don't think they will succeed, unfortunately. The West has been on top for, well, you could argue 500 years, certainly for the last 300 years. And things don't last forever. We've got things that are called cycles. And I'm not like defending China or anything. I'm just analyzing things. I wasn't the first one who came up with this idea that this is China's century. It was Jim Rogers, actually. He wrote about that. And that's why he moved to the Far East. That's why he's had his daughters learn Mandarin. And I think he's right about that. But what we're going to look at today is some numbers that show that China is doubling down, yet they're buying even more gold for the PBOC. And these numbers are probably underestimated because they're just the official numbers. I think China, they're, I think, the second biggest producer of gold in the world, but they're right there at the top. They don't export any of it. And there's some people who think, speculate that China has a lot more gold than the 2,300-odd tons that it reports officially. Yes, we got some data recently about their purchases, PBOC's purchase in June of this year. And they bought almost 15 tons, 14.93 tons to be exact. And back in May, we thought already, wow, they've doubled the amount that they bought in March because they bought almost 10 tons in March. They bought 4.98. In April, they increased it to 8.09 tons. This is very unusual. And prior to this year, as you can see here, they had slowed down quite a bit. They're buying most of 2025. They weren't even buying two tons. In the beginning of 2025, they were buying five tons. In 2024 as well, they stopped buying from April. Well, from May onwards, they only resumed buying at the end of the year. But you can see by this chart here, thanks to the People's Bank of China, that it's going vertical. And there are some people out there. He's done some research looking at import-export numbers in China and London. And he thinks that they're buying a lot more. And even Goldman Sachs caught on to that earlier this year. What else is going on? Well, I saw an interesting chart here that was created by Incrementum AG. And metal and miners caught on to it. And metal miners said the following. Less than one-fourth of every dollar is backed by gold. And foreign central banks are taking notice. The 100-year chart, the $27,000 overshoot math, and the supply squeeze that drives prices higher. So, yeah, as you can see, the average in the last 100-odd years or so has been 45.5% gold backing for the U.S. currency. And we're nowhere near that. We're around 20% it looks from this chart. But the other interesting thing that I noticed from this chart, and it's the reason why I'm talking to you about China, is if you look from the mid-30s up until the mid, well, let's say early mid-40s, the gold backing for the dollar went up a lot. It went over 100%. And that was a very chaotic and turbulent period, wasn't it? We had World War II. And it proves that Alan Greenspan's quote on gold being the only form of payment in extremis. And extremis means that, yeah, the world is messy. People aren't cooperating. It shows that gold is really important. So China might not be going back on a gold standard necessarily, but it's going back to having gold as its major reserve asset. The other thing I've noticed, and the Chinese are probably keeping a very close eye on that, is that the Japanese government is pushing its pension funds to repatriate a lot of their foreign investments, not only in treasuries, but I guess mostly in treasuries, but in all foreign government bonds, because they need to protect the yen. I noticed the Bank of Japan raised rates again to a 31-year high last week to 1.25%. So maybe they're waking up, and I think they're going to keep raising rates, and that's going to keep hurting treasuries. And the Chinese, of course, see that. And the higher rates go, the higher JGB yields go, the higher U.S. treasury yields are going to go, because the Japanese are not going to be buying as many treasuries. You can bet the Chinese are not going to be buying as many treasuries because, yeah, they don't want it frozen, like the U.S. and the EU froze Russian reserves. And that's why I think this is very positive for gold. And, I mean, it's amazing if you look at this chart again that we're talking about how China was actually not buying that much gold up until February this year. But it's taken the dip as an opportunity. They're good traders, the Chinese. They buy on the dip, and I'm not sure they're going to sell their gold. But the other thing they're doing, aside from this July 24th deadline, is a couple of things, actually. Last year, they increased the percentage, or they even allowed for the first time for insurers in China to put a certain percentage of their reserves or their assets into gold. And I think they're going to keep increasing that. And earlier this year as well, well, in the last month or so when they announced this deadline, they're encouraging the public to buy more and more physical gold through these accumulation accounts they have with Chinese banks. They've lowered the cost of transacting in these accumulation accounts, and they've also exempted the Chinese from taxes related to that. And I also saw here from David Lee, who I follow on X, I think he's based out of China, if I'm not mistaken. But he posted this Shenzhen Shuibei gold market on July 18th, which was Saturday. People everywhere, when prices are down, remember many major Chinese banks are halting retail intermediary services for paper gold trading next Friday. So people are going for the real thing. And I think that's going to put even more pressure on the price, on the supply of gold. I know gold supply is all out there. Gold is not really consumed, maybe a tiny amount. The stock to flow ratio is like the highest for any metal. But still, it will affect the supply. We saw back last year in the beginning of the year that the Bank of England and the LBMA couldn't deliver gold for four to eight weeks for spot gold. So I think, yeah, China is also trying to stabilize the gold market. They don't want the volatility and the speculation in gold because gold is too important to be allowed for allowing speculators to manipulate the price. That's something that the US and the UK, New York and London like, because we saw from that Wikileaks document from 1974, just before gold became legal again in the US, that the bullying deals in London were encouraging US authorities to create the gold futures market, which started trading on COMEX January, well, actually, December 31st, 1974. They said this is a good way to stop people from buying physical. Let them speculate and create a market that people will be discouraged from entering in because they don't want the public to buy physical. So here we have China doing the exact opposite. And I think that's very telling about how the elites in China and in the West think about the general public. They're telling them to do the right thing, in my opinion, because, as I said, we are in the end game for this debt-based system. I noticed that crude oil has gone back above 90, September Brent. The situation in the Middle East is getting worse. I saw that some US military personnel were killed in attacks in Jordan. The Iranians attacked, I think, an American facility at an airport or something like that in Jordan. And the Americans have retaliated. I've seen, as well, that the Iranians have hit tankers in the Persian Gulf or near the Strait of Hormuz. And the other thing I read is that ship owners, shipping companies, they're very uncomfortable now with what's going on. They're not going to try to venture through the Strait of Hormuz. And it's not just the price of oil that is a worry. And I spoke about this yesterday in my live stream. And I spoke about this a couple of weeks ago with Peter Carlin. And he was the one who brought this up because he used to trade the energy markets. He's a professional. And he said, what we have to worry about is diesel. And the situation is going to get worse and worse. The crack spread, which is the spread between crude and diesel, is at an extreme level. And as we know, diesel is paramount for the supply chain. It fuels trucks. It fuels airplanes. Well, jet fuel does. And that comes also from the sour crude. I don't know what's going to happen. But I think things are getting more and more chaotic, more and more turbulent. And I think that's why China is doubling down. I wouldn't be surprised if they buy even more gold in this month of July. Of course, we have to wait and see how much, you know, until next month to see what they do. In terms of the markets this morning, and it's 7.02 a.m. London time, we actually have seen silver trade up quite well. I think silver needs to break the 59 or 60 level. That's in the spot price. There's like a downward trend line coming the last few weeks. And that's been a big resistance. And it's around 59.60 for this week. We got up to 57.39. Right now, silver is at 56.60. And silver is outperforming gold. Gold is at 4,011. It's down about 6. It got up to as high as 4,029. And I noticed on the open of COMEX, excuse me, late London time yesterday, gold traded down to 39.82. So it rebounded. Silver got down to 55.50. The stock market indices are actually virtually unchanged. And also the currencies are not doing that much. What about the dollar-yen? Yeah, dollar-yen as well is pretty steady. Treasure yields, yeah, they're up slightly. The 30-year, well, actually 30-year is unchanged, 5.07. The 10-year, though, is up three basis points at 4.57. And the JGB yields have kind of stabilized since the government there has been encouraging pension funds to buy their own securities. And to do that, they're going to have to get out of Treasuries and other Western government bonds. Despite that, the long end of the JGB yield curve is up a bit today, the yields. Well, the 30-year is up 4.5 basis points at almost 3.90. And the 40-year is up 5.5 basis points. It's only the 10-year that's pretty stable at 2.71. So, yes, with that, I'm going to wish you all a very good day and a great start to the week. Take care. Bye.