As per recent increase in gold holdings by China, this snap-shot shows 2008 Sep gold distribution. At ancient time, gold represents power in most of the kingdoms. In this modern world, gold still carries a lot of weight against forex. A study shows that, while currency depreciates across time, gold has gone against that tide. Therefore, it is a critical necessity for country that needs stable growth, to be sheltered from financial crisis due to currency depreciation.
One interesting thing here is - the US & European countries have tremendously higher gold % in reserves, compared to Asian countries. Yet, their total financial reserves is far much lesser than Asia counterparts. That says three things: (1)huge gold % contributes to economy stability (2)huge financial reserves is not a necessary requirement for developed economy (3)Asian countries are funding the economy of West.
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