In this issue:

  • The international monetary system is unravelling
  • The how and the when are unclear
  • Gold is the ultimate hedge regardless

The structure of the international monetary system has not changed fundamentally ever since the US reneged on its promise to back the dollar with its gold reserves in the early 1970s. To this day the dollar remains the overwhelmingly dominant currency for international trade.

However, in recent years to US has increased the use of dollar sanctions on Iran and other countries to try and enforce its extraterritorial policies. Now that the Ukraine war is tilting in Russia’s favour, the US is even threatening global economic rival China with a suite of sanctions.

Beyond a certain point, China, Russia and other countries are likely to seek ways to avoid the use of the dollar in international trade. This could be highly disruptive not only for the foreign exchange markets, but financial markets more generally.

While no one knows just what might happen, there is one hedge against monetary mayhem that stands above all the rest: gold. Gold is the timeless, proven way to protect one’s wealth in uncertain, “interesting” times, such as those of today.

(In the latest issue of Altucher’s Investment Network UK in fact, gold was on the agenda with a recommendation in the space, alongside a tipped stock in another sector of the moment, AI. It’s well worth finding out more here.)

In this discussion with prominent monetary and financial markets commentator Brent Johnson, we explore all of the above.

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John Butler
Investment Director, Fortune & Freedom