Editor’s Note: For years, we refused to work with precious metals companies simply because we didn’t see a need to recommend them during the Trump era. We are STRONGLY recommending America-First companies now, especially for those wanting to protect their retirements long-term. As Central Banks, the CCP, and our own government quietly horde away gold and silver, it behooves Americans to pay attention. Here’s a report from our premium news partners at The Epoch Times that should be a clear sign about the direction of the economy. But know this: Every excuse the powers-that-be make for their moves to precious metals are just smokescreens. China isn’t really worried about sanctions. They’re worried about economic collapse.
China added 1.03 million ounces (32 tons) of gold to its reserves in November 2022, according to an official statement by China’s State Administration of Foreign Exchange (SAFE) on Dec. 7. Meanwhile, its holdings of U.S. treasury bonds fell to a 12-year low.
Analysts speculate that while China augments its gold reserves to hedge against risk, reducing U.S. dollar assets aims to mitigate possible sanctions for its support of Russia’s Ukraine invasion.
The increase brings China’s reported gold holdings to 63.67 million ounces (1,980 tons), worth about $112 billion. The SAFE statement is the first official update on China’s reserve assets since September 2019.
China’s holdings of U.S. treasury bonds dropped for the second month, to their lowest level since June 2010. The decrease left its holdings below $1 trillion for the sixth straight month.
A Global Trend
The move was in line with the overall demand for gold in 2022, as central banks around the world increased their gold reserves. Data published by World Gold Council on Dec. 2 showed that international gold reserves sustained a 41 percent increase in October. They are currently at their highest level since 1974, totaling 36,782 tons of gold.
In the third quarter of 2022, the total amount of gold purchased by global central banks was estimated to be almost 400 tons, worth around $20 billion. It was the largest single-quarter gold purchase globally since 2000, based on data published by World Gold Council in November.
As central banks scramble to purchase gold, total holdings of U.S. treasury bonds have declined. The volume of U.S. treasury bonds held by overseas central banks shrank continuously in September and October.
The number slid from $7.5386 trillion at the end of August to $7.1854 trillion at the end of October, according to data released by the U.S. Treasury Department on Dec. 15. The decrease totaled $353.2 billion.
Japan, the top foreign owner of U.S. treasury debt, reduced its holdings for four consecutive months in 2022; they stood at $1.078 trillion in October.
The price of U.S. treasuries has been dropping since August 2020 when the price of 30-year treasury bonds stood at over $182. The price was slightly over $125 on Dec. 30.
Given the current tendency to buy gold and sell U.S. treasury bonds, some experts suggest that the measures are intended to compensate for losses caused by the falling price of U.S. securities, and as a hedge against inflation.
Complex Motives
China’s motives may be more complex, however.
Albert Song is a researcher at Tianjun, a political and economics think tank. He told The Epoch Times on Dec. 31: “It may not be the top priority for the CCP to offset the adverse impact of falling prices of U.S. treasury bonds.”
While Song acknowledged that China may wish to hedge against risk, he emphasized that the CCP also “wants to avoid the latent risk of sanctions for its clandestine support for the Russian invasion of Ukraine.’
Moreover, he added, “The salient facts are the escalating tension of U.S.–China relations and [China’s] decoupling on every front.”
Song said he suspects that the CCP frequently provides false data to present an inflated image of China’s economy.
“Although the CCP’s central bank has disclosed that it has increased its gold reserves by 32 tons by the end of November, the published data is overstated to some extent,” he said, noting that “the amount is smaller than that of other gold-exporting countries, which may indicate that gold has been used for other purposes.”
To illustrate the discrepancy, Song pointed to data showing that Switzerland shipped 80.1 tons of gold to China in July, the second-highest monthly total since 2012.
Gold’s Unique Functions
Global gold prices fluctuated wildly in 2022. In March, due to the outbreak of the Russia–Ukraine war, gold soared to $2,000 per ounce, then fell as a consequence of the Federal Reserve’s strong interest rate hike. It witnessed a rebound later in the year, and started the new year at a six-month high.
In a world of intensifying political and economic uncertainty, augmenting gold reserves becomes a priority, Song said.
“Gold, as the hard currency favored by both the government and the people for hundreds of years, bears unique functions of hedge and appreciation, which ordinary currencies lack. Gold becomes germane particularly when a government is increasing money supply excessively.”
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Five Things New “Preppers” Forget When Getting Ready for Bad Times Ahead
The preparedness community is growing faster than it has in decades. Even during peak times such as Y2K, the economic downturn of 2008, and Covid, the vast majority of Americans made sure they had plenty of toilet paper but didn’t really stockpile anything else.
Things have changed. There’s a growing anxiety in this presidential election year that has prompted more Americans to get prepared for crazy events in the future. Some of it is being driven by fearmongers, but there are valid concerns with the economy, food supply, pharmaceuticals, the energy grid, and mass rioting that have pushed average Americans into “prepper” mode.
There are degrees of preparedness. One does not have to be a full-blown “doomsday prepper” living off-grid in a secure Montana bunker in order to be ahead of the curve. In many ways, preparedness isn’t about being able to perfectly handle every conceivable situation. It’s about being less dependent on government for as long as possible. Those who have proper “preps” will not be waiting for FEMA to distribute emergency supplies to the desperate masses.
Below are five things people new to preparedness (and sometimes even those with experience) often forget as they get ready. All five are common sense notions that do not rely on doomsday in order to be useful. It may be nice to own a tank during the apocalypse but there’s not much you can do with it until things get really crazy. The recommendations below can have places in the lives of average Americans whether doomsday comes or not.
Note: The information provided by this publication or any related communications is for informational purposes only and should not be considered as financial advice. We do not provide personalized investment, financial, or legal advice.
Secured Wealth
Whether in the bank or held in a retirement account, most Americans feel that their life’s savings is relatively secure. At least they did until the last couple of years when de-banking, geopolitical turmoil, and the threat of Central Bank Digital Currencies reared their ugly heads.
It behooves Americans to diversify their holdings. If there’s a triggering event or series of events that cripple the financial systems or devalue the U.S. Dollar, wealth can evaporate quickly. To hedge against potential turmoil, many Americans are looking in two directions: Crypto and physical precious metals.
There are huge advantages to cryptocurrencies, but there are also inherent risks because “virtual” money can become challenging to spend. Add in the push by central banks and governments to regulate or even replace cryptocurrencies with their own versions they control and the risks amplify. There’s nothing wrong with cryptocurrencies today but things can change rapidly.
As for physical precious metals, many Americans pay cash to keep plenty on hand in their safe. Rolling over or transferring retirement accounts into self-directed IRAs is also a popular option, but there are caveats. It can often take weeks or even months to get the gold and silver shipped if the owner chooses to close their account. This is why Genesis Gold Group stands out. Their relationship with the depositories allows for rapid closure and shipping, often in less than 10 days from the time the account holder makes their move. This can come in handy if things appear to be heading south.
Lots of Potable Water
One of the biggest shocks that hit new preppers is understanding how much potable water they need in order to survive. Experts claim one gallon of water per person per day is necessary. Even the most conservative estimates put it at over half-a-gallon. That means that for a family of four, they’ll need around 120 gallons of water to survive for a month if the taps turn off and the stores empty out.
Being near a fresh water source, whether it’s a river, lake, or well, is a best practice among experienced preppers. It’s necessary to have a water filter as well, even if the taps are still working. Many refuse to drink tap water even when there is no emergency. Berkey was our previous favorite but they’re under attack from regulators so the Alexapure systems are solid replacements.
For those in the city or away from fresh water sources, storage is the best option. This can be challenging because proper water storage containers take up a lot of room and are difficult to move if the need arises. For “bug in” situations, having a larger container that stores hundreds or even thousands of gallons is better than stacking 1-5 gallon containers. Unfortunately, they won’t be easily transportable and they can cost a lot to install.
Water is critical. If chaos erupts and water infrastructure is compromised, having a large backup supply can be lifesaving.
Pharmaceuticals and Medical Supplies
There are multiple threats specific to the medical supply chain. With Chinese and Indian imports accounting for over 90% of pharmaceutical ingredients in the United States, deteriorating relations could make it impossible to get the medicines and antibiotics many of us need.
Stocking up many prescription medications can be hard. Doctors generally do not like to prescribe large batches of drugs even if they are shelf-stable for extended periods of time. It is a best practice to ask your doctor if they can prescribe a larger amount. Today, some are sympathetic to concerns about pharmacies running out or becoming inaccessible. Tell them your concerns. It’s worth a shot. The worst they can do is say no.
If your doctor is unwilling to help you stock up on medicines, then Jase Medical is a good alternative. Through telehealth, they can prescribe daily meds or antibiotics that are shipped to your door. As proponents of medical freedom, they empathize with those who want to have enough medical supplies on hand in case things go wrong.
Energy Sources
The vast majority of Americans are locked into the grid. This has proven to be a massive liability when the grid goes down. Unfortunately, there are no inexpensive remedies.
Those living off-grid had to either spend a lot of money or effort (or both) to get their alternative energy sources like solar set up. For those who do not want to go so far, it’s still a best practice to have backup power sources. Diesel generators and portable solar panels are the two most popular, and while they’re not inexpensive they are not out of reach of most Americans who are concerned about being without power for extended periods of time.
Natural gas is another necessity for many, but that’s far more challenging to replace. Having alternatives for heating and cooking that can be powered if gas and electric grids go down is important. Have a backup for items that require power such as manual can openers. If you’re stuck eating canned foods for a while and all you have is an electric opener, you’ll have problems.
Don’t Forget the Protein
When most think about “prepping,” they think about their food supply. More Americans are turning to gardening and homesteading as ways to produce their own food. Others are working with local farmers and ranchers to purchase directly from the sources. This is a good idea whether doomsday comes or not, but it’s particularly important if the food supply chain is broken.
Most grocery stores have about one to two weeks worth of food, as do most American households. Grocers rely heavily on truckers to receive their ongoing shipments. In a crisis, the current process can fail. It behooves Americans for multiple reasons to localize their food purchases as much as possible.
Long-term storage is another popular option. Canned foods, MREs, and freeze dried meals are selling out quickly even as prices rise. But one component that is conspicuously absent in shelf-stable food is high-quality protein. Most survival food companies offer low quality “protein buckets” or cans of meat, but they are often barely edible.
Prepper All-Naturals offers premium cuts of steak that have been cooked sous vide and freeze dried to give them a 25-year shelf life. They offer Ribeye, NY Strip, and Tenderloin among others.
Having buckets of beans and rice is a good start, but keeping a solid supply of high-quality protein isn’t just healthier. It can help a family maintain normalcy through crises.
Prepare Without Fear
With all the challenges we face as Americans today, it can be emotionally draining. Citizens are scared and there’s nothing irrational about their concerns. Being prepared and making lifestyle changes to secure necessities can go a long way toward overcoming the fears that plague us. We should hope and pray for the best but prepare for the worst. And if the worst does come, then knowing we did what we could to be ready for it will help us face those challenges with confidence.
