Chinas groundbreaking launch of a yuan-denominated gold-pricing fix on its Shanghai Gold Exchange has been downplayed by some Western analysts, who cant seem to envision a day when London and New Yorks dominance of the industry might yield to Asia.

CPM Groups Jeff Christian, for example, told one news service that the yuan-linked gold fix is old news and that it is easy for commentators to read too much into it.

And while Societe Generales Robin Bhar conceded that it was an important development, he argued that as long as it exists inside a closed monetary system, it will have limited global repercussions. For a truly efficient benchmark, the market has to be as unimpeded and unfettered as possible.

But the closer we get to the source the Chinese themselves and the fixing participants, some of whom are Western the more significance this new innovation in the gold market assumes.

Turning the tables on London: Its a market of 1.2 billion people and simply cannot be neglected, said Marwan Shakarchi of the Swiss refiner MKS, one of the 18 institutions participating in the fix. I am convinced that in the future we wont say China is at a premium or discount to London, but vice versa.

Having more sway in the gold market befits the long-term strategy of expanding the yuans role as a global currency, saidJiang Shu of Shandong Gold Financial Holdings, an arm of the Shandong mining giant and another participant.

It reflects the next stage of the internationalisation of Chinas gold market, Aram Shishmanian of the World Gold Council told The South China Morning Post.

And perhaps the most bombshell analysis of the new yuan-based fixing comes from a strategist at Hong Kong banking behemoth Bocom International. In a Bloomberg interview (edited here slightly for clarity), Hao Hong makes it clear that dumping the U.S. dollar is front and center in Chinas long-term geopolitical and economic strategy not an overnight revolution but a slow, methodical plan with many interlocking parts, of which the Shanghai yuan gold fix is just one.

Slowly chipping away at the dollar: Its a planned move to move away from a U.S. dollar-centric monetary system, he said. What were seeing here right now is actually a move spanning across more than two years. If you still remember, in 2014 Shanghai opened the Shanghai International Gold Exchange, and it very soon became the largest gold exchange in the world. And they actually trade physical gold instead of paper gold. And also I think in 2016 this year, early this year, they already announced theyre going to fix the gold price in renminbi. In so doing, were slowly chipping away at the dominance of the U.S. dollar, and for China its moving away from a U.S. dollar-centric system.

Controlling the gold-pricing mechanisms is a key part of the plan, which also has involved stockpiling valuable, strategically important commodities. Silver and gold and also petrol are three very important commodities that are priced in U.S. dollars, and I think gold in particular is one of the commodities that the Chinese central bank is hoarding very hard, Hao said. The gold reserve holdings in the Chinese central-bank balance sheet have almost doubled since 2009, so by holding gold and by doing away with a U.S. dollar-centric system, we actually require less U.S. dollar holdings.

Although SocGens Bhar argued that the yuan gold fix will have limited repercussions because of Chinas relatively closed markets, Hao here reminds us that Chinas ultimate goal is going international. He cites the Chinese yuans recent green light from the International Monetary Fund to be added into the global reserve-currency basket known as Special Drawing Rights, or SDRs. Were trying to get a seat on the international table, and obviously weve been permitted into the SDR league. Very soon this year we are going to formally be included in the SDR currency, and also in so doing were doing all these concerted moves to move away from the U.S. dollar dominance.

A new system is needed: Hao concedes that China cant dump the dollar immediately, acknowledging that Beijing holds massive amounts of U.S. greenback currency reserves. China cant immediately challenge effectively the U.S. dollar dominance, he admitted.

Still, the current dollar hegemony is no longer serving Chinas long-term interests, and therefore its time for a change, Hao said. The system used to work very well for both countries. The U.S. people buy the Chinese exports, and then the Chinese buy the U.S. Treasuries. It worked very well. It depressed the U.S. bond yield and also created liquidity in the Chinese system. But then since 2015, the whole system sort of stuck in reverse. Since 2015, weve seen a decline in Chinese forex reserves and also weve seen a very slow buildup in Chinese forex reserves and a slowdown in Chinese exports as well. So we have to work out a different system to provide liquidity, a new system to provide liquidity in the Chinese macro-economy.

Investors who dismiss the significance of the yuan-linked gold fix do so to their own potential detriment. Were talking about the worlds biggest consumer and producer of gold, and the signs are clear that China is no longer content to take a back seat to Western powers. We have trained our eyes on the global market, said Li Guohong, general manager of the Shandong Gold Group. U.S. dollar holders should be paying close attention and acting accordingly, and that means hedging for the possible day that King Dollar might have to bow before the Royal Renminbi.

Gold and silver continued their two-pronged attack Tuesday after an unexpected plunge in new-home starts and permits cast a fresh cloud over the U.S. economy.

Also boosting gold was news that Chinas Shanghai Gold Exchange has officially launched its yuan-denominated gold-price fixing. The move is seen as a major Chinese step to exercise more control over golds pricing and increase the stature of the yuan currency versus the U.S. dollar.

This is a very important development and will obviously be very closely watched, Societe Generale analyst Robin Bhar told Bloomberg.

Rate-hike expectations fading: Rising 2% to hit a one-week high, gold gained about $20 to top $1,256. But once again, silver was the real head-turner, reaching a 10-month peak in a 5.2% ascent and breaking through the psychologically significant $17 level.

Gold should probably hang on to its gains in the second quarter because the dollar is likely to stay relatively subdued with the expectations of U.S. interest rate hikes being pushed out to the second half of this year, Mitsubishi analyst Jonathan Butler told Reuters.

Silvers rise driving down gold ratio: Whats driving silver? Traders are seizing on the disparity in the gold-to-silver price ratio, which currently suggests that the white metal is underpriced relative to the yellow metal. The ratio fell to its lowest level in four months, to 74, on Tuesday, down from a high of 83 in March, its highest level since 2008.

Inflows into silver ETFs are nearing record levels, trading volumes in New York are soaring, and the U.S. Mints sales of its 2016 silver American Eagle coins are continuing at a blistering pace, with more than 17.6 million sold so far this year.

Moreover, with signs that its economy might be picking up, China is a major silver buyer of late, according to Ronald Leung of Lee Cheong Gold Dealers in Hong Kong. One reason is that the dollar is weakening. Another reason is that there is heavy buying in silver in Shanghai, and that has triggered buying in gold as well, he told Reuters.

New-home starts plunge 9%: But back to the U.S. housing data. New-home construction slumped in March, with residential starts falling by 8.8% in what is supposed to be one of the busiest times of the year for the construction industry, while permits also dropped.

Meanwhile, underneath the rosy depictions of U.S. job growth is bad news that temporary-help employment has fallen for two of the past three months, down 1.8% for the year, while the Federal Reserves own labor-market conditions index also turned negative last month. A slowdown in temp hiring has signaled recessions in the past.

With U.S. manufacturing and retail sectors already suggestive of recessionary conditions, the housing market is or was the one major bright light left. Now that U.S. growth seems to be grinding to a near halt, the Fed will have little choice but to keep its monetary spigots flowing in the form of near-zero interest rates. The odds of an imminent rate hike are fading, and thats good news for both gold and silver prices.

If the U.S. needed a reminder about one of its greatest Achilles heels on the geopolitical front, Saudi Arabia has given it one: The oil-rich kingdom is threatening to dump up to $750 billion worth of U.S. assets, mainly Treasury bonds, if Congress passes a bill removing the sovereign immunity in U.S. courts enjoyed by the Saudi government. The bill theoretically would allow Saudi Arabia to be held culpable in American courts for any role it might have played in the Sept. 11, 2001, terrorist attacks.

Selloff would avoid any seizure: According to a New York Times report Sunday, the Saudi foreign minister, Adel al-Jubeir, delivered the threat personally in March while in Washington, D.C. Because the bills passage would allow compensation to be sought by 9/11 victims and their families, the sale of such assets would be a pre-emptive move to prevent their seizure.

The controversy is related to 28 pages of the 9/11 investigative commissions report on the attacks that remain classified to this day, reportedly because they detail some level of Saudi involvement. The Obama administration opposes the passage of the bill, saying it might endanger U.S. citizens living or traveling overseas.

Saudi portfolio also vulnerable: Regardless of whether (or not) the Saudis played any role in the attacks, or whether such a sale of assets would be practical, the news highlights the vulnerability of the U.S. because of its debt addiction.

The Los Angeles Times, for instance, points out that a dumping of U.S. assets could carry serious collateral damage for the Saudis themselves. Liquidating their entire holdings of U.S. Treasuries would have to be done over time, and if the sales began to move market prices not necessarily the case that would have an effect on the Saudis own portfolio, it wrote.

And of course, some analysts argue that the Federal Reserve still serves as the ultimate backstop against this threat of a Treasury dump. After all, the central bank could just swoop in and buy up more Treasuries a la its quantitative-easing programs to offset the Saudi selloff. But with the Feds balance sheet already pumped up to a massive $4.5 trillion that still has to be unwound, thats easier said than done.

China dumping bonds slowly, for now: But the elephant in the room remains the fact that Saudi Arabia is not the worlds biggest U.S. bondholder. That would be China, which owns $3.2 trillion worth, followed by Japan, at $1.3 trillion. The three nations together own 35% of the entire U.S. government bond market.

And as the 24/7 Wall St. Web site points out, China is slowly but steadily selling off its Treasury bond holdings, which have fallen 20% since 2014. It also notes the with liquidity drying up in the bond market thanks in part to Chinas liquidation, JPMorgan has estimated the amount of Treasuries that can now be sold in 2015 without affecting price has fallen to $80 million.

Although Saudi Arabia at present might not have the vindictive motivation to dump its Treasury holdings quickly to upset the market, that could change. And whos to say China might not find a reason in the years to come? Numerous high-ranking Chinese policymakers and academics have called for dumping the dollar, and even the Xinhua news agency, during the 2013 U.S. debt-ceiling standoff, urged a move toward a de-Americanized world. And now tensions are running high in the South China Sea as Chinese armed forces play chicken with the U.S. Navy over control of the controversial Spratly Islands.

China already is making multipronged moves to replace the U.S. dollar with its own currency, often in tandem with Russia. The fact that one of Americas biggest allies and chief enabler of the petrodollars supremacy, Saudi Arabia, is now making threats about dumping U.S. government bonds should be very troubling. China and Russia already are planning for the dawn of a de-Americanized world. The notion that Saudi Arabia is now getting in on the game, at least rhetorically, is yet another reason why investors should be diversifying their wealth out of dollars and into alternative currencies like gold and silver.

Whats the Federal Reserve been up to lately? Well, for one, the notably secretive central bank has held several unscheduled closed meetings of its top policymakers in the past two weeks.

The Fed announced these meetings on its Web site under expedited procedures. The topics the bankers discussed purportedly included a bank supervisory matter (April 6, April 12); a review and determination by the Board of Governors of the advance and discount rates to be charged by the Federal Reserve Banks (April 11); and a periodic briefing and discussion on financial markets, institutions, and infrastructure (April 13).

Yellen meets with Obama, Biden: Why are these significant? Because the last time such a meeting took place was on November 21, less then a month before the Feds historic first rate hike in years, Zero Hedge noted. With recessionary signs building in the U.S. and the presidential elections generating huge controversies, the Fed could have been discussing some major policy actions to launch if the economy continues to soften.

Even more interesting was another closed meeting on April 11 held after the Feds conclave this one between Fed Chairwoman Janet Yellen and none other than BOTH President Barack Obama and Vice President Joe Biden. Thats almost unprecedented.

President pleased with Yellen: According to the White House, The President and Chair Yellen met this afternoon in the Oval Office as part of an ongoing dialogue on the state of the economy. They discussed both the near and long-term growth outlook, the state of the labor market, inequality, and potential risks to the economy, both in the United States and globally. They also discussed the significant progress that has been made through the continued implementation of Wall Street Reform to strengthen our financial system and protect consumers.

Meanwhile, Obamas spokesman issued a statement saying that the president is pleased with the job Yellens been doing, and that the meeting would give them a chance to discuss the economy. Its an opportunity for them in some ways to trade notes on something theyre both looking at quite carefully, Josh Earnest said.

5 big banks fail living will test: But maybe these unprecedented meetings have something to do with an issue thats never quite gone away since the 2009 financial crisis: too big to fail banks.

According to The New York Times, the Fed and the Federal Deposit Insurance Corp. (FDIC) just warned five of the nations eight largest banks, which are now bigger than they were during the financial crisis, that they are still too big to fail. In other words, the five did not have credible plans for how they would wind themselves down in a crisis without sowing panic. That suggests that if there were another crisis today, the government would need to prop up the largest banks if it wanted to avoid financial chaos.

The crisis plans (or living wills) submitted by JPMorgan, Bank of America, Wells Fargo, State Street, and Bank of New York Mellon are not credible or would not facilitate an orderly resolution under the U.S. Bankruptcy Code, the regulators said.

Letter to JPMorgan heavily censored: Only Citigroup passed the muster of both agencies, while both Goldman Sachs and Morgan Stanley were OKd by only one of the agencies.

The goal to end too big to fail and protect the American taxpayer by ending bailouts remains just that: only a goal, said FDIC Vice Chairman Thomas Hoenig.

The Fed and FDIC also released a heavily redacted letter they sent to JPMorgan, which just announced declining profits and revenue for the first quarter, with the stark warning that the deficiencies in its emergency plan could pose serious adverse effects to the financial stability of the United States.

JPMorgan does not have an appropriate model and process for estimating and maintaining sufficient liquidity at, or readily available to, material entities in resolution, the letter read. JPMCs liquidity profile is vulnerable to adverse actions by third parties.

In other words, the biggest U.S. banks especially JPMorgan still remain highly interconnected and vulnerable to contagion if another debt/liquidity crisis erupts. The fact that so much of the banks business had to be censored before publication should raise eyebrows about the relationship of the big banks and their overseers.

Monetary policies at their limit: Moreover, the very regulator overseeing the biggest banks appears dangerously out of bullets to revive the economy without majorly aggressive action. Former Fed chief Alan Greenspan warned that monetary policy has done everything it can unless you want to put additional QEs on. Meanwhile, Greenspans successor at the Fed, Ben Bernanke, just posted an article calling for the radical idea of highly inflationary helicopter money to stimulate the economy, if necessary.

With the biggest banks still dangerous derivative- and debt-stuffed time bombs waiting to go off, the case for gold and silver to protect wealth has perhaps never been greater.