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Napanee, Ontario | #1:
"Usage in payments is only one indicium of a true reserve currency, and not the most important one. The key to being a reserve currency is not payments but investments. There needs to be a deep, liquid bond market denominated in the reserve currency. That way, when countries earn the target currency in trade, they have someplace to invest their surplus.
Right now, if you earn yuan trading with China, all you can do with the money is leave it in a bank deposit or spend it in China. There is no large yuan-denominated bond market to invest in."
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Jim Rickards on gold
