@Zeb @shortstories @Tfmonkey @VeganMGTOW @white_male Other way around. Large country starts hoarding their currency. Pick your reason. Imagine China starts hoarding gold-backed small nation notes. They can get them through a number of ways, legally. Because money is both a store of value and a convenience in a situation like this, they'll have the capacity to do this. It is an economic vulnerability at some point, is it not?

@BowsacNoodle @shortstories @Tfmonkey @VeganMGTOW @white_male
China is a government, so they can do whatever they want, legal or not.
Yes, holding foreign currency is always a geopolitical vulnerability because you don't control it, as sanctions prove. But the primary effects would be the new country currency would go up like crazy against the other fiat currencies, what would make their purchasing power skyrocket in comparison. For China, it would be a boom too:

@BowsacNoodle @shortstories @Tfmonkey @VeganMGTOW @white_male
All their costs would be in Yuan but their wealth would go up along with the gold currency as a reserve and they would benefit from being paid in this currency too. Very similar to how the US vs the Yuan was in the 70s.
The small country would be new singapore/new switzerland.

@Zeb @shortstories @Tfmonkey @VeganMGTOW @white_male Yes. But wouldn't 'Goldtopia' suffer a liquidity crisis with all of its money held as a value store by China? Nobody can buy bread when there's not enough money to go around because it's limited to physical assets. Do you see what I'm saying? George Soros could hypothetically buy out the economy of 'goldtopia' using his combined purchasing power and acquisition of assets through other markets and arbitrage. The vulnerability is real.

@BowsacNoodle @shortstories @Tfmonkey @VeganMGTOW @white_male
In theory, maybe, assuming prices would never go down, which they would, as they had in US for decades in the 17-1800s. But I'll tell you what has happened historically. Never has one country or even an entire continent has been able to hoard all the gold in the world. And all nations have also used silver and copper alongside gold as their daily trading currency, that are much more abundant. Prices would be much lower than today too.

@Zeb @shortstories @Tfmonkey @VeganMGTOW @white_male But how would such a thing happen today when the potentiality of external influence coming in to horde your currency for its stability exists? This still doesn't address the ledger issue: what to do with lost/damages notes? Do we assume this never happens, or do we force the currency to only be digital to prevent it? It could still be lost digitally, as we've seen.

@BowsacNoodle @shortstories @Tfmonkey @VeganMGTOW @white_male
It's ok, if a country wants to hoard your currency, it's fine. First, they would not get access to your currency directly (swap lines) but to your bonds. Second, it would appreciate your gold currency every time they buy, making each purchase more expensive than the previous one. It would be politically suicidal too to put all your reserves in an external currency, as they can always simply sanction you or cancel your transactions.

@Zeb @shortstories @Tfmonkey @VeganMGTOW @white_male Why wouldn't they get direct access? What would stop China from offering consumers 50% discount if paid in Goldtopia bills?