It's been my psychological backstop for a while and it has gotten firmer in my mind since the Eukrane issues. We all know that gold was being pushed down hard last year, in the paper markets, by a very large player. It was my belief all along that it was China who was pushing the pog down, simply in order to buy more physical bars at the lower price. If they are trying to become the largest holder of gold, they probably have quite a way to go before they overtake the US (but we don't know how much China actually has). However, when you're holding that much in any particular asset, you don't want it to devalue too much, too quickly, even if you want to buy more (just ask an IAG investor). The Yuan is depreciating, the Chinese gov. seems to be fine with this and they've even changed their peg variation against the USD. Their currency will probably continue to depreciate until they clear out a lot of the bad debt within the country, i.e. let hundreds of large cap companies fail and they know this too, so what are they going to buy with their depreciating currency in order to provide currency stability when they decide they need it..... They're not buying more UST's.