The Dollar System Is Losing Trust — Gold’s Monetary Reset Has Begun

**Ronnie Stoeferle** (0:02)
The problem with gold is, as you know, it's not about gold, actually, because gold doesn't change at all. It's about everything else. We are in a normal gold cycle, or if this is a monetary cycle, where we're actually at the beginning or right in the middle of a monetary revaluation of gold. It's quite plausible that central banks, sooner or later, will also buy small strategic Bitcoin positions alongside gold. The industry basically should practice what they preach. They produce this excellent hedge against inflation, but they sell like everything.

**Trey Reik** (1:03)
Greetings, and welcome to our Wealthion show. My name is Trey Reik, Chief Economist at GBI, and we're here today with Ronnie Stoeferle, partner at Incrementum AG in Liechtenstein. So the title for this year's report was Back to the Monetary Future, sort of a reference to the movie that we all recall. How did you come up with that title, and what are you trying to convey?

**Ronnie Stoeferle** (1:34)
Well, actually, I realized that the younger team members, they actually haven't seen the movie Back to the Future. So I gave them some homework and said, you've got to watch it. And they said, yeah, it's a good movie, especially the first one, second one, not so much, third one.
But I think it's, you know, if we really want to fix the present or especially the future, we have to go back into history. And I think that if you want to understand all the issues and the problems and the conflicts that we have nowadays, obviously you have to understand our monetary history. And that's what it's all about. So I would say that, you know, if we zoom out, I think what we try to analyze this year is really the question if we are in a normal gold cycle or if this is a monetary cycle where we're actually at the beginning or right in the middle of a monetary revaluation of gold.

**Trey Reik** (2:40)
Excellent. And one of the first ideas that you bring forth, and it's impossible to address all of the report, but I'm going to try to dance around to things that I thought really stuck out. You have this concept that the Pax Americana is coming to a close. So I know you could talk about this for half an hour, but give me a pre-see of your thought process there.

**Ronnie Stoeferle** (3:12)
Yeah, well, I think it's, as Hemingway would have said, gradually, then suddenly. I think the topic of de-dolarization is something that we are writing about for more than a decade, and now it's really becoming mainstream. We've seen it with the recent visit of Donald Trump in China, for example.
It seems that the Chinese were extremely confident, and I think in all sorts of areas, be it technology, the economy, science. It seems that China is at least, how do you say, on a level playing field these days, and really has picked up lots of momentum. And I think this, you know, it's, when I called the report In Gold, We Trust back then, in 2007, I was still a young analyst in a, in a Viennese bank, full hair.
You know, 2007, that's, that's really a long time ago. Back then, you know, as we write in the report, the US had, I think, six bill, six trillion in government debt. We haven't even seen the iPhone. Netflix was still mailing DVDs. So that's a long time ago. But when we called the report In Gold, We Trust, I wasn't really aware of the importance of the topic of trust. And 2019, we wrote a report called Gold in the age of the erosion of trust. And I think that's what that's what we're seeing. It's only not only this loss of trust in in science. It's obviously in politics. It's in institutions. OPEC, for example, United Nations, NATO. It's a loss of trust in America as the leader of the free world. With Donald Trump, it's pretty obvious that that he wants to focus on the Monroe or the Monroe doctrine. It's a loss of trust when it comes to central bankers and the independence and also the competence of central bankers.
So I think it's really the fact that the price of gold is rising that dramatically and I mean, last year up 65 percent in dollar terms. I mean, that was a huge move. But it also, if you change your perspective, it means that's an enormous loss of purchasing power of the dollar measured in gold. This is really a trend that we're seeing for quite a while and now it seems suddenly it's picking up more momentum. So from my point of view, everybody is obviously a little bit nervous and anxious regarding the current price action in gold. We'll really get a zoom out and try to discuss the question if this is a monetary cycle or not. Because in monetary terms, if you compare gold, for example, if you do the shadow gold price, if you do gold as a percentage of M0 or of M2, if you compare it to the valuation in equity markets, gold is actually still, I would say, a pretty reasonable prices. So I think people shouldn't just focus on the nominal price, but also have a closer look at relative charts. That's what we do quite a lot. And then analyze everything from a monetary point of view. And I think being European, my grandparents lived through, I think, four or five different fiat currencies. With every currency reform, they basically lost everything. So for them, having gold as a monetary insurance policy was just normal. While if you're American or British, obviously, there's gold isn't in the, let's say, monetary DNA.