The Russian government has been buying a lot of physical gold in recent years, instead of buying more US dollars to hold as foreign exchange reserves.

It’s probably why president Putin is getting bolder and more confident in his foreign policy, as it means his government is less exposed to US financial sanctions. Remember, the US government seized the Gaddafi regime’s US held financial assets when they launched war on his government. The West cut Iranian banks and as a consequence, government and companies out of global financial transactions when the Belgium based SWIFT cut them out of the global payments system.

The more gold Russia holds, the less exposed it is to this type of financial warfare.

The South African government is oblivious to this, and has not been adding more than a few ounces per month to its gold holdings in the last few years. Although it is diversifying away from the US dollar by buying Aussie dollars and Chinese renminbi, they don’t seem to recognize the strategic importance of physical gold.