We're in the 'Final Inning' of Dollar-Based System: Willem Middelkoop
What this covers
Willem Middelkoop believes the world is reaching a turning point when it comes to the global monetary system, and Western dollar supremacy is being challenged by the Eastern BRICS alliance. Willem notes that gold will be a massive beneficiary of this once-in-a-lifetime event, along with other commodities, such as silver, uranium, and more.
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00:00 Introduction 01:29 Escalating Global Conflict 04:50 Final Inning of the Dollar System 07:47 S&P 500 and NASDAQ 11:32 Is Gold Undervalued Right Now? 13:51 Forecast For Silver 15:39 Institutional Investment in Precious Metals 17:58 Gold Mining Stocks 19:19 Silver Mining Stocks 20:56 The Fed's Next Move 23:29 European Economy 24:48 Uranium Outlook 27:01 Niger and Juristictional Risk
#usdollar #gold #monetaryreset
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Middendorp argues that a long-term geopolitical and monetary reset is underway where the US dollar's dominance will decline over the next decade as BRICS nations establish alternative financial systems, making commodity investments—particularly precious metals and uranium—strategically valuable positions.
- Every 80-90 years the financial system experiences a major reset; the current dollar system that began in 1944 is in its end game
- BRICS nations are building alternative currencies and trading systems that will eventually rival the US dollar-centered system
- Gold and silver remain undervalued relative to their potential price if reintroduced into the global monetary system or if BRICS currency backs them
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Despite potential topping in broad equity markets, significant currency debasement and money printing could support stock prices rising even higher in nominal terms, similar to how Venezuela and Zimbabwe saw stock exchanges reach new records during hyperinflation.
“now we could say um that there's a major toop developing in Western Equity markets um but since we have so much debasement of currencies and with so much money printing I wouldn't be surprised that stocks could go even higher not because every everything goes well in the economy but look what happened to Venezuela the stock exchange there and look what happened to the Zimbabwe Stock Exchange they said all new records because of hyperinflation and debasement of currency”
Commodity stocks perform poorly when tech stocks perform well, as evidenced in the late 1990s; currently commodity stocks have bottomed and begun a revaluation upward while tech stocks and the broader market are in a topping process.
“commodity stocks do poorly when tax stocks do well we've seen that at the late 1990s as well so I think commodity stocks are have been bottoming out and have just started a revaluation process to the upside while tech stocks and the broader Market is in the process of topping out and could see uh more serious corrections”
Uranium is a strong commodity performer regardless of broader economic conditions because the global shift to nuclear energy is happening across the board, with significant reactor extensions, restarts, and buildouts occurring worldwide.
“one commodity which would appear to be a strong performer no matter what happens with the economy and markets is uranium and that simply because this shift to nuclear energy seems to be happening across the board and is moving forward the amount of reactor extensions restarts build outs happening around the world is quite significant”
Once silver starts to reevaluate higher, the whole basket of silver shares goes up, and even the worst companies in the space will rise most because they have fallen so much.
“we know from experience once silver starts to reevaluate higher the whole basket goes up and even the worst companies in this space will go up most because they came down so much”
Extremely tight uranium supply exists, especially after the world's largest uranium producer, Kazatomprom, missed production targets last year, appears to be missing them this year, and faces murky future production levels.
“along with extremely tight Supply especially after we've seen the world's largest uranium producer because Adam prom missed targets last year they're going to miss this year it appears and into the future it's kind of very murky there”
The Federal Reserve faces another huge problem: there are not enough willing buyers for US Treasury securities anymore, and the markets need to be supported in a massive way, requiring trillions of dollars in new monetary stimulus that will play out over the next 12-18 months.
“don't forget that there's another huge problem about financing the budget deficits in the US and they are not enough willing buyers anymore out there for the treasures so the markets needs to be supported in a big way and this is we're talking trillions and trillions and that will all play out in the next 12 to 18 months so expect more more QE to arrive pretty soon”
Every 80 to 90 years the global financial system experiences a major reset that changes both the financial system and geopolitical order, with a new global reserve currency emerging and a new dominant power rising to leadership.
“every 80 to 90 years we experience a big change in the financial system in the geopolitical situation in which we get a new leader um well new leader in the world world now we're in the dollar system um the dollar system started in 1944 with Breton Woods uh before that we were in we had the pound sterling as our world Reserve currency and we had the British Empire”
Gold price movements follow the amount of liquidity in the financial system, the amount of money in circulation, and the amount of debt; based on this ratio, gold could be valued significantly higher than current levels.
“the price of gold always follows the amount of well liquidity in the system the amount of money in circulation the amount of debt uh based on these this ratio um gold could go much higher”
With so much debt in the system, inflation becomes eventually good, and the Federal Reserve is stuck in its policy position, likely waiting to see what breaks first before reacting by lowering interest rates.
“well if you have so much depth then inflation eventually is good so but of course they're stuck um they um it's very hard for the Federal Reserve to do the right thing now and I think the Federal Reserve is just waiting to see what breaks first and once markets or parts of the system are starting to break down they will react and start lowering interest rates”
The current conflict between the US-led Western alliance and BRICS nations represents a 'World War III' that is hybrid in nature and fundamentally different from previous world wars, centered on competing financial systems and trade frameworks rather than traditional military conflict.
“we are entering a World War I type of conflict but it will be all different type of conflict compared to the first and the Second World War this is much more hybrid situation”
Despite official economic data looking good, many underlying economic problems are occurring—including weakness in commercial real estate, rising credit card debt, and rising car loan stress—suggesting the broader economy is not as strong as reported.
“the economy is is not very strong the official numbers might look good but as so much in the economy which is not going well especially in commercial real estate credit card debts uh car loans”
The Federal Reserve appears unable to tame inflation with recent CPI prints coming in hotter than expected, and the inflation data cannot be trusted because it is heavily hedonic adjusted and essentially lying to the public.
“it seems like they're completely unable to tame inflation recent CPI prints coming in hotter than expected and the numbers are ridiculous anyways they're not even real they're so hedonically adjusted whatever you want to call it um whatever fancy term you want to use for basically lying to everybody”
Silver is trading approximately 50% below its 1980 and 2011 peak prices of $50 per ounce, meaning it has significant catching-up to do relative to its historical highs.
“I think earlier this week um and and silver is especially uh of interest because silver is still trading almost 50% below its 1980 and 2011 top of $50”
Gold is currently reaching $2,400 again, and Citigroup published a prediction toward a $3,000 target within the next 12 months.
“today we reaching 2,400 again I wouldn't be surprised to see $3,000 gold with in the next 12 months even City group has um published um their prediction towards that Target I think earlier this week”
A coup occurred in Niger causing a collapse in uranium equity prices, followed by recovery, then further political deterioration when the Niger government cancelled its military agreements with the US, creating renewed uncertainty and another collapse in equities.
“we saw some jurisdictional risk come into play in nier with the coup that occurred there causing a collapse in the prices of a lot of the equities there was a recovery and then the political situation became further muddied by the government in nier saying okay we don't want anything to do with the US military we're canceling our agreements with them um so now things are very unclear in the region and we saw a collapse in the equities again”
The S&P 500 and NASDAQ can be analyzed through Elliott Wave theory as potentially completing a fifth wave that would mark the top of a bull market that began in 1942 when the Dow Jones traded at 100 during World War II.
“you could analyze those charts by pointing to let's say Elliot wave count that we're in the fifth we're trying to set a top in the fifth uh wave which is the end of a very long well well bull market actually the bull market for the Dow Jones started in 1942 at uh the depth of the second world war when the Dow Jones was trading at 100”
Gold and silver will be integral components of the new monetary system that the BRICS nations are developing, suggesting their inclusion in a potential commodity or gold-backed currency.
“for us as commodity investors and that's why I spent so much time researching this and thinking about this um I think Commodities and especially gold and silver will be part of the new system coming from the East”
Sultan Posa, a KY Swiss analyst, published analysis two years ago predicting we are witnessing the birth of a new monetary system coming from the East centered around commodities, providing analytical support for this shift.
“zultan posa who's This brilliant analyst who was with KY swis well KY swis is not there anymore there's a great example of what happens in reset you know Banks like C ssf and Sultan posa wrote two years ago that we're witnessing the birth of a new monetary system coming from the East centered around Commodities very interesting”
The BRICS alliance is very early in its development and will take several years or possibly a decade before it becomes powerful enough that Western nations, including Europe, will need to cooperate with BRICS countries rather than treat them as adversaries.
“um we're very early in the game um which the bricks um Club is is is starting to play so that's very early and it will take take several years and maybe even a decade before this bricks Alliance will become really powerful and um so powerful that we in the west need to walk uh and talk their book instead of of the US book”
The Commodity Discovery Fund concentrates on best discoveries that are tier-one or tier-two on a metal-agnostic basis, and for silver specifically only invests in very few discoveries with over 100 million ounces of silver in their first resource estimate.
“we just buy the S SJ um I um in our portfolio we only have a very few individual silver names a silver being the best we concentrate on the best discoveries the tier one tier 2 discoveries worldwide uh metal agnostic so in silver we only invested in the very few a silver discoveries which are over 100 million ounce of silver uh in their first resource estimate”
There is significant money to be made in uranium because it is such a small space with very few quality names, suggesting outsized returns potential.
“and there's more money to be made because it's such a small space and and the quality names you know are are very few”
The Commodity Discovery Fund avoids investing in Venezuela, Russia, China, Niger, and Mali due to perceived jurisdictional and political risk, but does invest in Western African countries like Guinea and Côte d'Ivoire where the fund feels comfortable.
“but we certain countries we don't touch we don't touch Venezuela or Russia or China um and also we we don't touch ner or Mali but we do we do investments in the western africas but like Guin and C Divo and um we feel comfortable there uh but Mali and niir it's it's it's it's a different part um of the world where we don't feel too comfortable to invest”
We are currently in the final inning of the dollar system's dominance, but this does not mean the dollar will collapse within 2-3 years; rather, the almighty dollar's relative power will be noticeably diminished over a 10-year horizon.
“now we're in the end game of the current dollar system so we're the final inning of the current dollar system but that doesn't this doesn't mean that the dollar will collapse within the next two to three years but 10 years from now will conclude that the the the power of the almighty dollar is is is quite a bit um less than it was 10 years ago”
The Commodity Discovery Fund is adding to silver positions massively in recent weeks because multiple indicators suggest silver could have a big run, particularly evidenced by very strong volume increases in silver ETFs (SLV, SJ) that exceed volume increases in gold mining ETFs (GDX).
“we run the commodity Discovery Fund and we are adding to our silver positions quite massively in the last few weeks because we see uh many indicators that silver could have a big run and if you look at the volume indicators the volume of trading in the S and SJ you see a very strong jump in the volume even much more than in the GDX”
The uranium market setup is very positive, and the Commodity Discovery Fund has been watching uranium since at least 2015-16-17, building long positions and investing early in NextGen Energy, which has a market cap of over $3 billion today, up from $30-40 million at initial investment.
“yeah it's very positive we've been watching the uranium market for years pointing to the bottoming out in 2015 16 17 uh build a long position especially in NextGen energy um who's responsible for the well the most valuable new uranium Discovery in in decades um a company Grew From a market cap of 30 40 million when we first invested in it to over it's over three billion I think now”
A long and strong correction in the broader stock market could begin in the second half of the current year after the top is potentially already set, but the bottoming and topping process after such a long bull move will take many months, quarters, or longer to fully unfold.
“so I wouldn't be surprised to see the start of a long and strong correction over the next few years and that could actually start in the second half this year maybe we set the top already but uh a a a process of bottoming and Topping after such a long move will also take many months and many quarters and maybe longer”
In Europe, the ECB will feel pressured to lower rates in the next 12-18 months as the economy weakens, particularly because rising oil and copper prices will increase inflation pressure, creating a difficult policy environment.
“I think the ECB will be pressured as well will feel pressured as well to lower start lowering rates uh in the next 12 to 18 months because um I think the economy will will start to weaken a bit more um of course um price of oil and copper and many Commodities are starting to rise again so this will increase inflation pressure”
Gold mining majors have 'woken up' along with the rise in gold prices and still offer investment opportunities, though some recent pullbacks have occurred.
“oh there there's still so much value out there look at uh new mon we started to build a position new mining around 30 we even bought uh around 29 and I think we're around 40 now uh so we only had the first the first recovery”
Newmont Mining could easily double in price over the next 12-18 months, and the same applies to Barrick Gold and other similar mining shares with substantial remaining upside.
“uh Newman could easily double in the next 12 to 18 months same goes for barck same goes for all these shares”
The Commodity Discovery Fund can accept quite a bit of investment risk because it spreads management over approximately 100 million euros of assets across almost 100 different investments, providing portfolio diversification that allows for acceptance of idiosyncratic risks.
“well we can accept quite a bit of risk because we spread our um over 100 million euros ass on management over let's say uh almost 100 different Investments”
The Commodity Discovery Fund's investor base consists of high net worth and ultra-high net worth family offices rather than institutional investors, and the fund intentionally avoids most institutional investor participation.
“our investor base is high net worth and ultra high net worth family offices we don't meet a lot of institutional people we try to avoid that”
The Commodity Discovery Fund minimizes marketing and advertising spend, but after the 2020 COVID crash and the arrival of inflation, investors actively approached the fund for allocations.
“we don't we don't spend uh a lot of money on marketing and advertising but after the 2020 covid crash and then the when the inflation arrived investors really came knocking um on our door”
The Commodity Discovery Fund is a Dutch-based fund open to investors worldwide including the US and Canada, uses ISIN fund structure with high regulatory standards, has almost 2,000 individual investors primarily from Dutch-speaking countries, and the founder is active on Twitter with a Patreon account for followers.
“we're a dutch-based uh fund uh but we are open for investors worldwide even from the US and Canada we use its fund um highly regulated we have almost 2,000 individual investors uh mainly from the Dutch speaking countries um I'm quite active on Twitter you can follow find and follow me there and I have a patreon account”
Middendorp has been researching geopolitical and monetary reset dynamics for an extended period and has spent significant time analyzing the BRICS bloc and its implications for commodity investors, indicating deep engagement with these themes
“and for us as commodity investors and that's why I spent so much time researching this and thinking about this”
The Commodity Discovery Fund also has a position in Abra Silver, which is a good discovery, though it is located in Argentina.
“we have a position Abra silver um that's that's uh quite a good Discovery as well but that's in Argentina”
The fund has several individual uranium names and also invests in the UR uranium ETF for diversified uranium exposure.
“we have a few of those these individual names and then of course we also invest in the UR the uranium ETF”
McCuloch is quite active on Twitter and maintains a Patreon account for people who want to follow developments in the reset process.
“I'm quite active on Twitter you can follow find and follow me there and I have a patreon account which I will send you the link for the show notes for people who want to stay on top of the whole reset uh process and developments”