Currency is something we often use in our daily lives. Many people think that the printing of currency is actually just a matter of a country. It can print as much as it wants, but in fact it is the currency issuance of each country. They are all measured by the economic level of each country. If currency is issued and printed indiscriminately, it will have a fundamental consequence, that is, currency devaluation and soaring prices.

For example, Venezuela and Zimbabwe we mentioned have experienced currency devaluation. Bundles of currency cannot be exchanged for many daily necessities. During the War of Liberation in my country, due to the economic collapse of the Kuomintang-controlled areas, This phenomenon was once caused. In fact, before World War II, the currency levels of various countries were linked to their own production capabilities, so that basic economic levels could be maintained. After the end of World War II, a monetary system "Bretton Woods System" was established around the world. Although the Bretton Woods System collapsed around the 1970s, its influence continues to this day.

The reason why this system was established was mainly because the United States was the largest gold reserve country in the world at that time. The U.S. dollar was directly linked to gold at that time. We have also seen it in various movies and TV dramas. Liberation During the war, people ran against gold, oceans, and the U.S. dollar, because the U.S. dollar was the most valuable currency in the world at that time. On the contrary, the gold yuan notes issued by the National Government turned into waste paper. This has a lot to do with the credibility of a government.

After the Bretton Woods system was established in 1944, in order to improve the world's monetary chaos, 22 countries in the world jointly established the International Monetary Fund and the World Bank in 1945, and two years later, it became the United Nations. Since the United States, as the world's largest gold reserve country, uses the U.S. dollar as the exchange basis for the world's currency, each country transports its gold reserves to the United States and exchanges them for U.S. dollars.

Germany once handed over half of its gold reserves to the United States for safekeeping after the war, and even today, although the Bretton Woods system has long since collapsed, the United States is still one of Germany's largest gold holders. In this After the system was established, more than 70% of the world's gold was in the hands of the United States, of which less than 5% belonged to the United States. The Soviet Union at that time also put hundreds of tons of gold into the United States. China once had about 600 tons of gold stored in the United States, which once accounted for more than half of China's gold reserves.

But the fact is that after the Cold War began, the Soviet Union gradually withdrew gold from the United States, and the wars launched by the United States around the world after World War II resulted in its gold reserves getting lower and lower. , the credibility of the US dollar was greatly reduced, so later all countries in the world gradually withdrew gold from the United States. But even so, the United States is still the country with the largest gold reserves in the world. Therefore, although the price of the U.S. dollar is relatively fluctuating internationally, it still has great credibility, and China does not want to take out these gold. Once it is taken out, the U.S. dollar market will There will be drastic changes. However, as China's economic power continues to develop, the proportion of these hundreds of tons of gold has become smaller and smaller, and is now equivalent to only one percent of China's foreign exchange reserves.