What do you think a Chinese Gold Standard would do to the price of Gold? http://kingworldnews.com/kingworldn...To_Impose_Bretton_Woods_II_Gold_Standard.html
Wrong question, proper should be: How high should gold be revalued to allow for modern gold standard. Answer: it all depends on percentage backing; ie: how much of currency % would be backed by gold. Edit: Almost forgot, what kind of M0, M1, M2 .... would you like to use too.
If you take just the global debts of national governments http://www.economist.com/content/global_debt_clock Divide that by the total above ground gold supply http://www.numbersleuth.org/worlds-gold/ You get a number of around $9,452/ozt But then that doesn't take into account all the shadow banking derivatives that are out there which is more than global GDP. But if China were to announce the gold backing of their currency on its own, then the effect would be hard to predict. Would it mean that China would only accept gold as payment for its goods? Would the rest of the world deplete their gold reserves buying Chinese goods, or would that just make Chinese goods too expensive are force the rest of the world to start servicing their own needs more effectively. One thing for sure, it would be the end of the welfare state in Australia, because we would literally have no money because the UK would not be returning our gold.
This was my first thought. It would cripple their economy. The rest of the world wouldn't service their own needs though. They would just look to a new emerging economy.
the Chinese/Russians would back their paper with real assets when the "beggar thy neighbor" wouldn't work anymore. It would be a new paradigm where the stronger the currency the better. Its been so long its hard to remember it used to be like that. I don't know how high the price of gold would go in nominal terms, but I think its purchasing power would explode. It would almost impossible to regular people to buy.
