5 ms·

China dumps all bonds. US declares return to gold standards. Chinese economy crashes. World experiences significant economic downturn but soon recovers.

1stop 13y ago
Yes, that's how it would play out. China dumping US money, would be an actively hostile thing to do... implying they wanted to do other hostile things as well... The world would likely become a very different place, real fast.
- alexeisadeski3 13y ago
  China dumping US currency and/or bonds would be an awesome opportunity for everyone else. We could buy the wonderfully underpriced securities from China and make bank once the price pops back up a few months later. It'd basically be suicide for the seller - in this case the central bank of China.
  - deleted 13y ago
    [deleted]
  - 1stop 13y ago
    Sorry, in this hypothetical, china would only do something so rash if it were going to war. There would be no "making bank" there would just be war... and given the scale of said hypthetical war, I'm not sure there would even be a victor...
not-impressed 13y ago
Haha are you aware of the amount of Gold china is buying? http://www.ingoldwetrust.ch/unprecedented-total-chinese-gold-demand-2013 http://www.ingoldwetrust.ch/unprecedented-total-chinese-gold... If/when USD looses its position as a reserve currency, the price of gold will skyrocket and China will be looking smug.
- wintersFright 13y ago
  and this http://www.shanghaidaily.com/business/China-expected-to-announce-it-has-more-than-doubled-gold-reserve-expert-says/shdaily.shtml http://www.shanghaidaily.com/business/China-expected-to-anno...
tokenizer 13y ago
No offense, but China has been getting tons of gold on its balance sheet for awhile now. USA wont even let Germany have theirs for 8 years, as it'll take that long to get it... which means I question the reserve amounts the US has...
wintersFright 13y ago
The world was fooled once by promises of US gold which Nixon defaulted on. They won't fall for that one again.

1stop 13y ago

Yes, that's how it would play out. China dumping US money, would be an actively hostile thing to do... implying they wanted to do other hostile things as well... The world would likely become a very different place, real fast.

alexeisadeski3 13y ago
China dumping US currency and/or bonds would be an awesome opportunity for everyone else. We could buy the wonderfully underpriced securities from China and make bank once the price pops back up a few months later. It'd basically be suicide for the seller - in this case the central bank of China.
- deleted 13y ago
  [deleted]
- 1stop 13y ago
  Sorry, in this hypothetical, china would only do something so rash if it were going to war. There would be no "making bank" there would just be war... and given the scale of said hypthetical war, I'm not sure there would even be a victor...

not-impressed 13y ago

Haha are you aware of the amount of Gold china is buying? http://www.ingoldwetrust.ch/unprecedented-total-chinese-gold-demand-2013 http://www.ingoldwetrust.ch/unprecedented-total-chinese-gold... If/when USD looses its position as a reserve currency, the price of gold will skyrocket and China will be looking smug.

wintersFright 13y ago
and this http://www.shanghaidaily.com/business/China-expected-to-announce-it-has-more-than-doubled-gold-reserve-expert-says/shdaily.shtml http://www.shanghaidaily.com/business/China-expected-to-anno...

tokenizer 13y ago

No offense, but China has been getting tons of gold on its balance sheet for awhile now. USA wont even let Germany have theirs for 8 years, as it'll take that long to get it... which means I question the reserve amounts the US has...

wintersFright 13y ago

The world was fooled once by promises of US gold which Nixon defaulted on. They won't fall for that one again.