PBOC Researcher Calls on U.S. to Sell Gold Reserves, People's Daily Says

Let's assume for a moment that the U.S. has possession, not simply paper receipts, for its 8,000+ tons of gold reserves. Any official announcement that they intend to unload their reserves would send the dollar into a tailspin down the elevator shaft. This outcome using history as a guide would not be in the best interests of the United States.

The U.S. should cut its government spending and sell some gold reserves to balance its budget and fund its recovery, the People’s Daily overseas edition reported, citing Xia Bin, an adviser to the People’s Bank of China.

The U.S. has to resolve its “twin deficits” in the government budget and the current account, Xia was quoted as saying. Three ways that may help the U.S. achieve that target include reducing military expenses, selling part of its gold reserves and relaxing some export limits on technology, he said.

Source: bloomberg.com