The GoldFix Gold-Monetization Thesis
The Case for Revaluing Gold, and Retiring US Debt With it
“So, yes, buy bonds. Tell the world it is a first step toward the restoration of Hamilton’s sinking fund. Attack the debt. Redeem the paper dollar. Make American finance great again.” - James Grant
The Case for Revaluing Gold, and Retiring US Debt With it
Background: Gold Reset Puzzle Pieces
After reading a section in this week’s very enjoyable Grants IRO, a missing piece of the Gold revaluation puzzle was finally found. Having already opined a Gold reset was happening and saying as much;1 one final piece eluded a cohesive theory on it.
The missing puzzle-piece in question was: How would this gold revaluation be catalyzed and cemented without damaging the USD/Bond markets? A signpost of some sort would be needed to this effect as well.
As it turns out, that signpost may have already been given during President Trump’s Sovereign Wealth Fund (SWF) announcement. Trump’s Executive Order for creating a SWF in combination with the aforementioned Grant’s story obliged us with a solid answer as to how gold would be reset and to what purpose that revaluation would serve. First, here is a clip from Trump’s SWF signing courtesy Chris Marcus at Arcadia Economics:
Scott Bessent’s Comments May Hold the Key to Gold’s Revaluation…
Full video commentary at Arcadia Economics
Taking what Bessent said in the clip above and putting it in context with Grant’s analysis explaining a gold revaluation could be done in combination with monetization for debt retirement; and it all made sense.
As a result, Bessent’s seemingly obscure statement describing what the US could monetize (Gold)— as opposed to what we would buy (Tik-Tok?)— made perfect sense.
Bottom Line: Trump’s Sovereign Wealth Fund could be used similarly to a Sinking fund. The rest was easy.