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<Research>CICC: Gold Value Revaluation Doesn't Signal Return to Gold Standard
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The international monetary order is poised for restructuring, though it will not revert to the gold standard, CICC released a research report saying. The gold standard once delivered nearly a century of global prosperity and stability, enabling not only the free flow of capital but also significantly boosting international trade and economic growth. Consequently, nostalgia for the gold standard persists today. However, its operation relied heavily on international cooperation, and maintaining international reputation often came at the expense of domestic employment and economic well-being. With profound shifts in the international political and economic landscape, the gold standard has consequently lost its practical viability as an institutional arrangement. CICC believed that the revaluation of gold does not signify a return to the gold standard, but rather reflects the marginal decline in the credibility of the USD and the restructuring of the global monetary landscape. Against this backdrop, central banks' increased gold holdings serve primarily to diversify risks rather than re-establish the gold standard. Gold can still serve as a store of value and safe haven asset in a multipolar landscape. However, it cannot replace credit money's functions in interest rate adjustment, liquidity provision and asset pricing, nor can it meet the modern financial system's structural demand for safe assets. AAStocks Financial News Website: www.aastocks.com |
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