As most of you know, the yuan, or renminbi is the official currency for the People’s Republic of China. Special Drawing Rights are…
Special drawing rights (XDR or SDR) are supplementary foreign exchange reserve assets defined and maintained by the International Monetary Fund (IMF). Their value is based on a basket of key international currencies reviewed by IMF every five years….
…or SDRs are the currency of central banks.
SDRs are made up of a basket of currencies — and the yuan’s inclusion has been a long-awaited, if not controversial next step. Given that PBOC, China’s central bank has been frantically accumulating gold, many assume that this may be symbolic of gold’s re-entry into the world currency system.
Do you see gold being included anytime soon, and if it were included, what do you think the immediate or intermediate effect on fiat currencies would be?
Andy Hoffman: Look, no one knows exactly what will happen in the world. I can only state my educated opinion or best guess opinion, and I remember way back when in May or June, when people were clamoring about how they’re going to allow it in, the yuan into the SDR, and it’s going to cause gold to soar, and I wrote there’s really not a chance that China’s going to admit how much gold it has because it’s not in their best interest, as well as the fact is, as I put it, they have no interest in these western, reindeer games. Meaning, there is absolutely, to me, nothing about the SDR that has any relevance to the world. It’s really, to me, chatter that a bunch of bankers get together and say let’s pretend that there’s something of value here. No one could care less about the stupid thing, and I said, when everyone else said that China would say how much gold it has, I said there’s no way, and sure enough, they didn’t.
They put out some minuscule amounts, 1,600 tons, and they’ve continued now, people aren’t even noticing, they’ve been adding 20 tons a month, 15 tons a month. Five or ten times more than the entire COMEX has every month, but no one’s paying attention.
Ultimately, the Chinese, when they’re forced by collapsing economies and currencies, and markets, and unrest, then they will force to admit how much gold they have, but in the meantime, me personally, I don’t put any credence into this SDR stuff at all. I don’t believe anything is going to come of it until the markets force the hand of the people that are trying to run these games.
Look for more like this over the coming week…In the meantime, see below for the entire interview…