Breaking the dollar

Last few posts have been focused on the current administration getting ready to break the dollar.

This video discusses how the Fed will be "absorbed" into the Fed.
Can't stress enough diversify into international and assets.

USA Debt Train accelerates

 

The Big Beautiful Bill is positioned to break the promise of lowering USA debt machine.  Surprise!
The Treasury must roll over 7 trillion in debt AND add to that whatever deficit the new bill brings, I expect additional 2 trillion dollars.

What should happen is the USA bond prices rise, and President Trump will blame the Fed for not lowering rates.  What is missing is the Fed does NOT control treasury rates, the willingness of the world to by Treasuries sets the rates.   The Fed COULD just print money, buy US treasuries and lower rates.  Since 2008 the Fed has done this using "Quantitative easing".

I expect however a new twist, and that is to change the laws around USA banks on amount of US Treasuries they can own and even mandate they purchase more treasuries. If this comes to pass the potential Treasury crisis in 2025 will be kicked.   The next one in the years ahead will be when USA banks cannot buy more treasuries due to fiscal constraints, and the world cannot buy treasuries.  As rates rise, bank treasury holdings will decline materially and cannot be sold without taking a material loss.

The Fed can then buy those treasuries as a "Swap" for cash, but at some point this will become a problem for the world politically.  At that point, we have finally reached the end of the USA debt train line.

So I do think we have years for this to run through, but in the mean time we should see Gold, Bitcoin, and other assets with limited quantiles accelerate.   Silver is taking off like a rocket, and is positioned to do a 4x in short order.  Bitcoin IMO should exceed $1M a coin by 2028.  Buying international assets can help maintain value through the rocky roads ahead.

For a more normal POV of the debt train, see this video.

US Dollar Red Line

Below is a US Dollar chart from 2008 to today.  The red uptrend line, when broken, will be an indicator to the world President Trump is successfully 'revaluing' the USD.  Once broken we may see the market finally pull back, and with risk off push the dollar back up.

However, at some point, we could see the USD depreciation pick up, but I suspect that will be next year. 

If or when the lowest green line is penetrated, it will be panic time for USA, for all time lows will be achieved.  I would expect imports to materially rise in price.

See next chart about the stock market.

The US stock market relative to the world hit an all time high on Jan 21s.  Although the S&P 500 is only 2.5% below all time highs inside the USA, outside the USA the market is a full 10% off all time highs.

The green line represents the SPY adjusted for USD value.  This is how the USD will be devalued, in a manner of which people inside the USA think they haven't lost savings.  When infact, USD devaluation is removing their asset values.

For example, if the USD drops 20% more from all time highs, even if the SPY is at todays level, the US assets would be a full 30% from all time highs.

Please see https://websurfinmurf.blogspot.com/2025/04/american-assets-declining-ahead.html