"Strong buying by China has helped lift commodity prices around the world this spring, but growing evidence suggests that a sizeable portion of this buying has been to build stockpiles in China, and may not be sustainable. At least 90 large freighters full of iron ore are idling off Chinese ports, where they face waits of up to two weeks to unload because port storage operations are overflowing, chief executives of shipping companies said in interviews this week. Yet actual steel exports remain weak. Commodities and shipping executives describe Chinese stockpiling in recent months of a range of other commodities as well, including alumimum, copper, nickel, zinc, canola and soybeans. Starting in April, China began stockpiling significant quantities of crude oil", Keith Bradsher, at the NYT, 11 June 2009: http://www.nytimes.com/2009/06/11/business/economy/11commodity.html.
"However, this boils down to nothing more than grandstanding. The Chinese are not idiots. ... Indeed, abandoning the dollar for another currency (say the yen or euro) would serve no benefit from an economic standpoint. ... It would be akin to trading one problematic investment for another: no major world currency is backed by gold or any asset of real value. ... Throughout 2009, China has been buying up natural resouces, commodities, and other real assets at a break-taking pace. ... The headlines were right under the world's collective nose, but no one was thinking 'diversification away from the dollar.' Instead they were thinking, 'purchases needed to fuel economic growth.' ... The reasoning here is simple. Unlike paper currencies, natural resources and commodities cannot be reproduced ad infinitum by central banks. ... Make no mistake, the Chinese have already begun diversifying away from the dollar. They just haven't advertised the fact openly", original italics, Graham Summers (GS), at Gold Eagle, 17 June 2009: http://www.gold-eagle.com/editorials_08/summers061709pv.html.
Secretly? Correction, real assets are not "denominated" in dollars, but units like: barrels, bushels, pounds, etc. What is gold's denomination? Is a krugerrand worth more or less than an American Eagle or Chinese Panda? An ounce of gold is an ounce of gold.