Gold watch

It seems that the inevitable abandonment of the US Dollar as reserve currency is gaining momentum as China admits that it is building up its gold reserves in a report to the IMF.

"The financial crisis means the U.S. dollar value is changing fast, and it may retreat from being the international reserve currency. If that happens, whoever holds gold will be at an advantage."

Look for China to dump its trillion-dollar reserve in the mother of all spending sprees as soon as it feels comfortable about its own gold reserve buildup.

The European Central Bank recommends its member banks hold 15% of their reserves in gold, but among Asian nations the percentage is far smaller...

Go we therefore and do likewise? Buildup gold reserves and dump the dollar? Do we have enough gold in the ground, or have our gold reserves been spirited away to other countries by our own wonderfully corruption-free governments?