In all the talks that's been goin' on about new reserve currencies over the last couple of years , wether the yuan would become one or a new reserve currency including a basket of currency , including the yuan and maybe gold would eventualy be created , it appears reasonable to think that China in any of those eventualities would have to back the yuan in some ways before it happens .

Over the last 2 years China has made some large progress in making the yuan more " tradable " and keep expanding it's use in world trade while at the same time linking it's value to the US $ and discretely increasing it's gold holdings as well as access to gold imports for the population at large . All of wich should strenghten the yuan over the long run .

It's probably just a matter of time before they engage in openly buying gold from the IMF as they refrained to do until now . If they do that it will be a bad signal for the US$ and a strong signal for gold but by then the yuan will have reached near reserve currency status and the world economy scenery will look quite different.

Tec