Debt

As the center of the global economy gradually shifts from the United States to the Global South, and gold reserves follow suit, could a new hegemonic currency emerge to rival the dollar?

Today, the price of gold is rising primarily as a sign of gradual currency depreciation. Tomorrow, it could rise as a safe-haven asset amid systemic uncertainty.

U.S. federal debt has now surpassed the 100% of GDP threshold. This figure refers to federal debt held by the public ($31.27 trillion), excluding debt held by the Fed. Total debt therefore stands at $39 trillion, or 122% of GDP.

It appears that highly aggressive traders—or insiders betting on confidential information—have taken out around 500,000 call options, wagering on a silver price between $900 and $1,000 by the end of the year. You may consider them reckless traders and dismiss this information…

The government poses a risk that must be factored into the development of one’s investment portfolio. Jeff Park proposes the “radical portfolio,” structured around an “inside/outside the system” approach, where the “system” refers to the government.

It is now clear that the contemporary monetary system is coming to an end. Gold has grasped the stakes of such a collapse.

Does gold signal a return of inflation? Everything points to it. Gold has recently become the world’s most traded asset by volume, surpassing U.S. debt and major currencies.

The war in Iran is not only contributing to a resurgence of inflationary pressures across the Atlantic, thereby destabilizing financial markets, but is also accelerating the global shift away from the dollar.

The Strait of Hormuz, one of the world's main energy arteries, is partially paralyzed. Even so, the price of gold is showing little reaction to the extreme volatility of oil prices. It remains focused on a deeper dynamic within the financial system: that of credit.

The gap between the euphoria in the equity markets and the first cracks emerging in certain areas of credit is striking. In this environment, gold plays the role of an insurance against a financial accident or a sudden reversal in liquidity.