Doubting the Dollar Goes Mainstream

Dear Member,

I don’t usually pay too much attention to the World Economic Forum Annual Meeting in Davos, Switzerland. It’s a pompous event. And for the most part, nobody says anything interesting or controversial.

But this year, there are a few stories worth paying attention to. Greg Jensen, a top Bridgewater Associates executive, said worldwide inflation and swollen U.S. budget and trade deficits could cost the U.S. dollar its status as the world’s reserve currency.

“That could happen quickly or it could happen a decade from now,” he told The Financial Times. “But it’s definitely in the range of possibilities. And when you look at the geopolitical strife, how many foreign entities really want to hold dollars? And what are they going to hold? Gold stands out.”

Not long ago, it was considered pretty crazy to say something like that. Now it’s coming from the co-chief investment officer of the world’s largest hedge fund. In other words, the elephant in the room is finally being discussed at the big table.

Jensen likes gold in this scenario. But I believe all the things he talks about are just as applicable to bitcoin. In my mind, gold and bitcoin are different ways to play the same situation. Gold is a lot safer and has good potential. Bitcoin is more risky and has more potential.

And Ray Dalio, founder of Bridgewater, said that “cash is trash” while he was at Davos.

It’s a big change to see these topics finally out in the open.

Now every investment manager in the world can feel comfortable going to their boss and proposing the firm buy gold (and bitcoin).