Quick Note: China's Plan, The USD, and Gold

*How* Gold’s reset is a process, not an event

China forces gold to account for the growing disparity between the yuan and the dollar. The underlying message is simple: the dollar is overvalued relative to gold, and the U.S. should devalue its currency against the metal. Gold’s current price in dollars fails to reflect the last two decades of global economic shifts.

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China’s Strategy: Gold and the Dollar

China is taking a calculated approach to challenging the dollar’s dominance. Instead of directly manipulating the yuan, it uses gold to shift power between the yuan and the dollar. While the U.S. pushes China to lower the yuan’s value against the dollar, China focuses on revaluing its currency against gold by purchasing gold with its own held U.S. dollars.

Gold as Referee

This strategy lets gold act as a neutral arbiter between the two currencies. Through steady action, China forces gold to account for the growing disparity between the yuan and the dollar. The underlying message is simple: the dollar is overvalued relative to gold, and the U.S. should devalue its currency against the metal. Gold’s current price in dollars fails to reflect the last two decades of global economic shifts.

By using gold instead of direct currency adjustments, China maintains its leverage while avoiding accusations of manipulation under international rules. This is extremely important. Being a “currency manipulator” opens the door for action against a nation. What better way to avoid this by using a third item, Gold, to revalue against?

The U.S., constrained by its own trade policies, struggles to counter this gold-based strategy. Gold is not a currency anymore in the West… well that is backfiring now….LOL

This approach facilitates China’s larger goal of strengthening its global position without engaging in outright financial conflict.

China’s gold focus ties directly to BRICS discussions on creating a new (currency) payment chain to rival the dollar. This initiative, combined with China’s steady accumulation of gold, underscores its commitment to reshaping global finance.

By letting gold mediate (almost like a referee) the relationship between the yuan and the dollar, China strengthens its economic hand and gradually undermines the dollar’s dominance. This forward-looking strategy keeps China on the path to becoming a dominant global economic force.

An Unspoken Agreement in A Multipolar Mercantile World

The question raised is: if we know this, the US knows this. What are they doing about it? Can they do anything about it? If both nations also realize to openly fight over this would ruin them both, has an understanding thus been reached?

Finally, even with an understanding of sorts.. What is the US planning (hoping?) to re-cement USD reserve status by taking back global trade dominance.

The US must become competitive in a multipolar mercantile world.

That is where Trump and his team’s policies come in we bet.