THE “REVERSE NIXON SHOCK” EXPLAINED IN SIMPLE WORDS
Before 1971, the United States held enough gold to strongly support the U.S. dollars and Treasury bonds owned by foreign countries.
Back then, gold coverage was very high — around 70% to 100%.
Today, that protection is much lower.
Gold now covers only about 14% of the U.S. Treasuries held by other countries.
Because of this big gap, some analysts believe the price of gold would need to rise to around $25,000–$35,000 to restore global confidence in the U.S. financial system.
At the same time, central banks around the world are buying gold early, before any major change in the monetary system happens.
This is often called “front-running” a future reset, meaning they are preparing in advance.
In very simple terms:
• Gold support for the dollar is much weaker than in the past
• A much higher gold price could help rebuild trust
• Central banks are quietly increasing gold reserves before big changes arrive
Many investors see this as a sign that gold may play a much bigger role in the future global financial system.
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