And yes I am a sucker for following the macro.

@Seymourbutts, I'm not doing anything differently, I find myself being more interested and aware of it than ever though. Someone wise said on a podcast recently that it pays to be a student of history. History suggests it's not "if" USD looses reserve currency status but "when", but there is also global momentum and network effects in play. Despite Elon's best (worst) efforts he wasn't able to kill twitter. Trump is doing his best but killing the USD is still a tall order. For me whether or not this series of events is enough to pivot the global economy is still a big, big *if*. And *if* it is, then I think it slowly unwinds over decades in unpredictable ways so will be hard to trade anyway. I'll continue to watch on with fascination and make sure my portfolio has some diversity and resilience tucked away for a rainy day.

Edit - I just reminded myself I made a small allocation to a bitcoin ETF not long after this thread initially took off, so I guess I have done something small in response.

Me too @Seymourbutts, macro is just super fascinating, even though I don't think you can easily trade it. It's the timing thats the (extremely) hard part. And my thinking pretty much aligns with yours @Lewis

But I think macro does have value in helping you know what to avoid. For me, the lessons from history suggest that in the latter stages of a debt and currency crisis (if, like Dalio, that's what you think is happening) cash and bonds become toxic.

I also think you want to avoid financial entities like banks (especially banks), hedge funds, insurance companies and the like, as well as anything tied to discretionary retail or commercial property sectors. In fact, any company with a fairly leveraged balance sheet is worth avoiding (utility-like operations with long dated debt may be a possible exception). These institutions are always the first to get crushed by vanishing liquidity.

What you want to favour are things that have genuine value and dont just rest on paper promises.

Hard Assets like gold are the traditional go to. It's had a great run, but I doubt it's anywhere near done.

Unlevered (or conservatively levered) productive businesses are also great. Especially things like defensive industrial companies that enjoy reasonably consistent demand. (In 1931, even as the Reich verged on bankruptcy, leaders in chemicals and engineering stayed on top because they had real productive capacity independent of a failing banking system)

Quality Land and commodities can be good too, even if nominal prices drop during a deflationary spiral, as they can retain their actual purchasing power while paper claims are being annihilated.

Of course, a strong pivot to an ultra defensive stance has risks too. Namely, that we muddle along for longer than people think (which often happens). And you can experience "melt ups" before any crisis point is reached, as cheap money and desperate policy inflates all assets.

It's all super tricky of course. I just don't want to be one Truth social post away from disaster.

I might be the last to pick this up, but about 4 days ago, the BRICS announced their new trading currency. Imaginatively called the UNIT. 40% tied to the gold price and the other 60% to a basket of their currencies.

With Brazil, China, Egypt, Ethiopia, India, Indonesia, Iran, Russian Federation, Saudi Arabia, South Africa, and the United Arab Emirates now in BRICS, that’s a fair whack of the world’s trade right there.

And I assume the recent EU-Mercosur deal, as well as the just inked EU-India deal will be denominated in Euros.

Looks like the move away from the USD as the world’s reserve currency is well underway.

Thanks for that @Lewis - excellent find, a great presentation. Very clear. That said, although the title says Stage 5, in the video itself, he makes it fairly clear that the USD is already in (the early stages of) Stage 6 - Loss of Confidence and the Search for Alternatives. Given recent global money flows and recent contracts (e.g. BHP's latest with China being partly in Yuan), Stage 6 seems pretty clearly to be unfolding.

The one question the presentation left me with was: Does the Australian RBA hold any USD reserves? Anyone know?

And if so, why???

Thanks, @BigStrawbs70 - and lo and behold, the RBA publishes a Balance Sheet online.

https://www.rba.gov.au/statistics/balance-sheet/

That's as of 12/11/25. The total value of assets is shown as ~ 400 billion, presumably AUD.

The tab under Official Reserve Assets (left side bar) leads to this: https://www.rba.gov.au/statistics/frequency/reserve-assets.html

Which separates the foreign assets from Gold but doesn't break it down by country. Total Official Reserve Assets (as of end October) was 107 billion.

Assuming Gemini's figures are correct, then the RBA Official Reserve Assets are ~ 33% US at the moment.

I’m pretty sure someone else posted about the following before, and many years ago, I mentioned Lyn Alden as an interesting thinker on this subject.

Am I imaging it or did someone recently read “Broken Money” ? Her book on the subject.

One really needs to zoom out and take a historical perspective when thinking on this subject. I find it fascinating but it’s easy to become chicken little and make some bad decisions as a result. Or just embrace cognitive dissonance as it’s all too hard. Timing and portfolio positioning are everything I suppose, but getting that right for all scenarios is really, really tricky.

I am off to the pub and hence choosing cognitive dissonance as my preferred strategy

have a great weekend!

c

@Chagsy, I don't think there are many new ideas in economics, I'm sure it gets talked about constantly. I'm with you on the timing, you could make a move today and wait a few lifetimes for it to play out.

I like your short term strategy too, sounds like a plan.

Great find @Lewis. Right up my alley.

Re the RBA balance sheet @Clio, the fact it is in negative equity to the tune of $20b is hilarious. Of course, it's not a problem. But the reason it's not a problem is what I find amusing :)

Thanks @Lewis, good find! I asked my PA to look for some numbers ;-)

RBA reserves (Oct): A$107B total. FX: A$63B (59%), gold A$14B, SDRs A$20B, IMF A$3.6B, other A$5.3B.

Balance sheet (12 Nov): Gold+FX A$111B—includes repos/swaps excluded from official count.

US: ~USD245B total. FX only USD39B (16%), rest SDRs+IMF (USD~200B). US holds almost no own USD in reserves; RBA’s FX likely ~60% USD = ~A$38B.

Negative equity A$4.2B on BS—no issue for a central bank…the’ll just leave the printer on…

Stage 5 confirmed!