The Dollar System Is Breaking & Gold Is Becoming Money Again w/ Andy Schectman

Quick Overview

Andy Schectman argues that the global dollar system is breaking due to massive, unchecked fiscal irresponsibility, leading to a loss of trust that will eventually force a revaluation of gold and silver, likely resulting in gold being settled outside of the dollar system, potentially via cross-border settlement utilizing digital yuan or similar non-USD assets.

Key Points: Andy Schectman asserts that the US Treasury's fiscal irresponsibility, including adding $1 trillion to the debt every 100 days during the shutdown, has irrevocably broken trust in the dollar system (0:04-0:19, 2:58-3:10). The lack of trust is global, exemplified by Saudi Arabia and China actively pursuing deals outside the dollar system, such as using digital yuan for oil transactions (2:00-2:43). Physical gold and silver demand is surging as investors seek tangible assets outside the compromised fiat system, with gold up 70% and silver up 100% this year (1:55-2:01, 8:25-8:30). Schectman predicts that gold will be revalued to $4,000 per ounce, or potentially higher, to settle the massive debts that the US cannot otherwise manage (3:03-3:10, 3:42-3:59). The move away from the dollar is driven by countries like China and Russia actively building alternatives, such as the digital yuan settlement system, which is intended to bypass Western sanctions (2:39-2:43, 6:50-7:12). Miles Franklin implemented a 'T+1' settlement standard, meaning physical metal delivery occurs one day after the trade, which is faster than the typical T+2 settlement and demonstrates a commitment to physical backing (1:11-1:26, 10:55-10:58). Schectman notes that the Fed's actions, like printing money to buy Treasuries, erode the dollar's value, which is why gold's role as a true store of value is becoming increasingly apparent (5:56-6:20, 7:08-7:14).

Context: John Gillen of Milk Road Macro interviews Andy Schectman, President of Miles Franklin Precious Metals, to discuss the current state of the US dollar, global reserve currency status, and the increasing demand for physical precious metals like gold and silver. Schectman details the underlying fiscal instability of the US system and how geopolitical actors are positioning themselves for a post-dollar world.