Core Insights - A chart showing the changing proportions of gold reserves and U.S. Treasury securities in global international reserves has gained significant attention on social media, indicating a potential shift in investment strategies among countries [1][2] - The proportion of U.S. Treasury securities in global reserves peaked around one-third in 2016 but is projected to decline to below 25% by mid-2025, while gold reserves are expected to rise above 25% [1] - The price of gold has increased significantly from around $1,200-$1,300 per ounce in 2016 to approximately $3,300 per ounce by mid-2025, while the yield on 10-year U.S. Treasury bonds has risen from an average of 1.85% in 2016 to around 4.2%-4.3% [1] Investment Behavior - The decline in U.S. Treasury securities and the rise in gold reserves are influenced by sovereign nations intentionally increasing their gold holdings while reducing U.S. Treasury investments [2] - The period of rising U.S. Treasury securities (1980-2016) coincided with a phase of robust economic globalization, while the decline since 2016 aligns with a backlash against globalization [2][3] - The U.S. dollar remains the dominant global reserve currency, but confidence in the current monetary system has been shaken by recent U.S. government actions, including trade wars and asset freezes [3][4] Future Outlook - The trend of reducing U.S. Treasury holdings may become a rational choice for emerging markets and some developed countries, despite the dollar's continued importance in the international monetary system [4] - Other currencies such as the euro, yuan, yen, and pound are expected to play increasingly significant roles, with the yuan showing the most potential [4] - The future international monetary system may evolve into a hybrid model combining elements of the "three islands of global financial stability" and the proposed "Bretton Woods 3.0" framework [4]

Core Insights - The article discusses the changing dynamics between gold reserves and U.S. Treasury securities in global international reserves, highlighting a significant shift expected in late 2025 where gold reserves will surpass U.S. Treasury securities for the first time since 1996 [2][3]. Group 1: Trends in Gold and U.S. Treasury Securities - Gold reserves have seen an increase from approximately 10% in 2008 and 2016 to over 25% in mid-2025, while U.S. Treasury securities have decreased from about one-third in 2016 to below 25% in mid-2025 [2][3]. - The price of gold rose from around $1,200-$1,300 per ounce in 2016 to approximately $3,300 per ounce by mid-2025, contributing to the increase in gold reserves' value [3]. - The yield on 10-year U.S. Treasury securities increased from an average of about 1.85% in 2016 to around 4.2%-4.3% in mid-2025, leading to a decline in the market price of existing U.S. Treasury securities [3]. Group 2: Global Economic Context - The period of rising U.S. Treasury securities from 1980 to 2016 coincided with a phase of strong global economic and financial globalization, while the decline since 2016 aligns with a period of challenges to globalization [4]. - Key events in 2016, such as Brexit and the election of Donald Trump, marked a significant turning point in global economic dynamics [4]. Group 3: Impact of U.S. Policies - The Trump administration's trade policies and reluctance to provide global public goods have undermined confidence in the current international monetary system, affecting the perception of U.S. Treasury securities as a safe asset [5]. - The freezing of Russian foreign assets by the U.S. government during the Ukraine conflict raised concerns about the reliability of U.S. Treasury securities, leading to discussions about potential forced conversions of U.S. debt held by foreign nations [5][6]. Group 4: Future of the International Monetary System - Despite a projected decline in the dollar's international status, it will remain the most important reserve currency, while other currencies like the euro, yuan, yen, and pound will gain significance [7]. - The future international monetary system may evolve into a hybrid model incorporating elements of the "global financial stability trilemma" and the proposed "Bretton Woods 3.0" framework [7].

Core Viewpoint - The article discusses the rising interest in gold as a reserve asset among central banks globally, driven by increasing distrust in the US dollar and the evolving international monetary order [2][6][8]. Group 1: Historical Context - The article outlines the historical evolution of the monetary system, starting from the gold standard established in 1816, transitioning to the Bretton Woods system in 1944, and finally to the dollar standard post-1971 after the Nixon shock [5][6]. - It highlights the unprecedented international cooperation achieved during the Plaza Accord in 1985, where countries recognized the irreplaceable value of the dollar [5]. Group 2: Current Trends in Gold Holdings - Central banks' gold holdings have surged back to levels not seen since the Bretton Woods era, reaching approximately 37,000 tons, with gold now becoming the second-largest reserve asset after the dollar [6]. - Countries like Poland and Indonesia are increasing their gold reserves, with Poland's central bank aiming for gold to constitute 30% of its foreign exchange reserves by 2025 [6]. Group 3: Distrust in the Dollar - There is a growing sentiment of distrust towards the US dollar, even among US citizens, with criticisms aimed at the Federal Reserve's quantitative easing policies, which are perceived as leading to inflation and financial instability [7]. - The article notes that the lack of a viable alternative to the dollar is driving investors towards gold, which is seen as a "currency G-zero" in the current financial landscape [8]. Group 4: Future Implications - The article suggests that the current trends indicate a significant transformation in the global monetary order, with gold's rising prominence being just the beginning of this change [8]. - Notable investors predict that substantial financial, economic, and political upheavals are likely to occur in the coming years, further influencing the dynamics of currency and reserve asset preferences [8].