Chamath Palihapitiya
· Chamath Palihapitiya
· July 02, 2026 at 18:19
· ⏱ 2 min read
| Read on Substack ↗
Summary
Central banks are increasingly holding gold over U.S. Treasuries as a reserve asset, signaling a hedge against monetary expansion and geopolitical uncertainty. This shift, led by China, suggests ongoing demand for gold and potential divergence between precious metals driven by different supply-demand dynamics, with implications for portfolio construction and the dollar system.
•For the first time since 1996, central banks hold more gold than U.S. Treasuries as a share of reserves, despite gold paying no interest.
•China's gold reserves exceed 74 million ounces, as it reduces U.S. Treasury holdings.
•Measured in gold, the S&P 500 has not made a new high since 2000, stripping out effects of monetary expansion.
•Silver spiked above $100 per ounce in January, forcing manufacturers to redesign products around cheaper metals.