World Economic Forum: “Central banks are diversifying their currency reserves, and the development of alternative payment corridors that reduce dependencies on the US dollar are expanding. Recent analysis by the World Economic Forum estimates that heightened fragmentation could reduce global GDP by up to $5.7 trillion, while also stoking inflation.”
As the Global Reserve Currency, the dollar dominance is directly correlated to perceived safety and security of the government, and the economy in relation to other dominant economies. Alternative currencies at this stage are not a threat, however, Trump’s Tariffs and Warring have created a wobble. A wobble in earth’s rotation creates fragmentation, a wobble in the global financial system can create a collapse.
The wobble began when the Trump Tariffs were announced fracturing global trade and causing China’s yuan to gain some dominance. While Bitcoin isn’t tied to a country or government, it too gained traction in 2025 in response to Trump’s rhetoric and escalating flip-flops leading to his now rather psychotic behavior. Trump’s posturing on Iran gave even more traction to China and the wobbling became more frenetic. The US market is not an indicater of much of anything any longer, as finances are shared between BlackRock, Vanguard and State Street. Leaving the stage empty except for a single podium and a monologue of pitiful LIES. Anyone…. Anyone…?
The only country with the courage to mock this hideous Play and give it an F Rating, has been Iran. The three countries hedging against the dollar include China, Russia and Turkey who have been steadily buying gold in anticipation of a dollar and/or America collapse. Since 1970, the dollar as a global foreign exchange reserve had dropped by a third before the policies of Trump and the War.
IF gold became the new reserve currency, America would be forced to reveal the contents of Fort Knox. The last audit was around 1974 and was considered rather inane given it was simply an invitation for some congressional members to view the vaults. The last full audit was in 1953 under Eisenhower. If in fact the vaults are severely depleted as many believe, should gold become the new reserve currency, America is farked. In July 2025, France requested the return of its $15 billion gold reserves from the US. It took until January 2026 for the US to comply.
If the dollar lost its place on the throne, America would likely face significantly higher borrowing costs, forcing a choice between tax hikes, debt restructuring, or severe austerity measures. True inflation would be catastrophic. As everything that was – is no longer, and the shroud of lies would be forced to speak truth. A tumbling instead of a wobble. Something like the collapse of the Soviet Union. One rather interesting shift would be the removal of economic sanctions with which the US is so gloriously generous.
Currently, over 30 countries and 13,000 individuals are sanctioned by America. In addition, some 500 entities are sanctioned for human rights offenses and abuses. That leverage would disappear. Spain has become the latest country to be expelled from trade by Trump. These sanctions ride piggy-back on who is holding the golden rod of Global Reserve Currency.
In 1944 The Bretton Woods system was adopted in which America was appointed the holder of the global currency status because the US controlled two thirds of the global gold. In 1971, Nixon ended the convertibility of the US dollar to gold and effectively ended the Bretton Woods Agreement. Thus, the dollar was now simple fiat currency – it’s only backing a pinky swear promise creating floating exchange rates. Nixon instituted this fiat system to halt a run on U.S. gold reserves by foreign nations, combat inflation, and prevent economic collapse. Massive foreign debt, trade deficits, and high costs from the Vietnam War had crumbled America’s economy.
At the time of Nixon’s decision, the US debt to GDP was 35%, and the DoD budget was $72 billion. Today the debt to GDP is 125% and likely to grow significantly as the Iran War costs, Venezuela conflict costs, Israeli military costs, and tariffs blow the economy apart, while the Dod Budget is well over $1 Trillion. Adjusted for inflation, the 1971 Dod $72 Billion budget would be worth roughly $590 Billion or about half the true budget imposed today.
Statistically the numbers are completely out of whack! Today 60% of the global gold (assuming America isn’t lying) is held by the US, Germany, France, Russia, China, Japan, and Italy. Not only has the US lost its ranking in GDP and DoD Spending, it no longer has the right to exalt holding 66% of the world’s gold for which status as the ‘Global Currency Reserve’ was framed. Thus, we are listing heavily on perceptions, illusions, and crystal ball estimations.
BRICS accelerated the use of alternate currencies as did the era of Bitcoin et al. The Iran war will further this evolution and central banks will sell off treasuries to balance their portfolio risks. China, Brazil, India, Japan, Sweden and Denmark are selling treasuries while increasing their holding in gold. The slow reorganization of world powers is gaining significant traction. IF Trump was pro-America, this would be his focus. Instead, Trump is literally doing the exact opposite …
There is nothing we can do to stop the wobble. We have the wobble because they want the wobble. We are moving into the darkest period of history in my view. I was glad, though, to hear today that 50 percent of the monster AI data centers to be built in 2026 will not happen. Follow the money.
Great summation. Marty Armstrong’s Socrates says we’re 7 years away from the dollar crashing. Maybe. And Iran is on until 2028.
Prepare accordingly. Marty has 2 years of food in his Tampa condo.