Discussion on De-Dollarization and Investment

Sequencing is very important in macro.

Se- sequencing is, um, you know, right now,

and maybe we'll talk about it later, is there is clearly a

slow motion de-dollarization going on.

But could the initial stages be a dollar rally

because

companies, countries are paying back their dollar debt?

So there's a dollar thirst before there's a

dollar boycott.

Well, you, you can't see my sheet of questions,

but as we move to investment

themes, number one is de-dollarization. So you already jumped in there.

So how do you think about taking that idea, which

I guess many people would say isn't controversial, that the dollar loses

not its hegemony, its relative status.

How do you think about the journey ahead and how do you think about in, as an

investor, when is the right time to build your

positions?

Again, you know, we look for stress in the system, uh,

is, uh, we, we just did a three-day offsite here in

London and, you know, I came away thinking that we had

these kind of meta long arc ideas, and

the real,

the, uh, challenge here is, as you just said, the, uh,

where to implement them as actionable market ideas.

You see things happening on the margin.

This Shanghai Gold Exchange, very interesting.

Uh, we see, uh, India and China

being able to pay for oil, which is the ultimate dollar,

the

commodity, and the, uh, rupees

and RMB. So you've now moved the

US out of the way.

So, and, you know, I'll, I'll tell you is the, the real wake-up call

for me was last December

and we, we were doing a call with one of our

consultants, uh,

the, uh, much older fellow, great thinker,

and French, and he said, "You know, like I

was used to, okay, the US has sanctioned Venezuela,

the US has

sanctioned Russia, US has sanctioned Iran." And he

said, "You know, it is untenable that the

US can extend its foreign policy to the

French government

via the dollar. And, uh, and just this

huge multi-billion dollar fine on BNP

is going to make a US ally want

to think of a new way

of, of doing business." So, you know, like you have, you know, this new

term, the global south, that wants out of the dollar system.

Very interesting if French Republic wants out of the dollar

system.

Yes. And the seizing Russian reserves has

probably only

accelerated that.

Yeah.

They haven't been seized until they're frozen. Right.

Wow.

But, uh, my inclination is that they, uh, you know, they will

disappear.

So

all of this debt swirling around the system, one is,

as an investor, should be thinking about the preservation

of purchasing power

almost above all, and therefore currencies has always been

a, you know, a relative

game. And I sometimes get some criticism from my

partner, Will Campion, about the

fact that, you know, I'm a long-term believer in gold

and a distuster of the

central banks. You have written about gold

and has painted

a scenario.

Gold is a, um, not a

fiat currency. There's a limited amount.

It is recognized as a store of value.

And, you know, you are seeing that you can keep

gold in your vault and you can move it back.

The, you know, the...

And, you know, I, I am adamantly anti-Russian,

but the mistake the Russians made was the Russians got onto war

footing in terms of their foreign exchange reserves, but they

moved out of dollars into euros, and they never believed

that the Europeans would have the wherewithal, the

inclination to follow the Americans.

If the Russians had moved entirely into gold, price would be

higher, but they would have all their reserves in

Moscow.

So I, you know, I think a lot of the, uh, you know,

who, who knows whether China's moving onto war

footing vis-a-vis Taiwan?

The

Chinese PBOC is the largest buyer of gold now.

So, you know, c- could we imagine, you know, again, back to imagination,

could we imagine some kind of a

RMB that is exchangeable into gold maybe at a

premium?

So I don't disagree with, uh, you know, any of that, which is probably why I find

myself constantly sort of, you know, rolling my eyes when people mention

Bitcoin.

Gold can be a risk off and a risk on asset.

Bitcoin is a risk on asset.