165 - Death of the Dollar?! with Lyn Alden

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Apr 3, 2023

Lyn Alden, a renowned macro commentator, dives deep into the chaotic financial landscape. She discusses the Fed's expanding balance sheet and its implications for the dollar's status as the world’s reserve currency. The conversation also highlights how recent bank crises could affect the 2024 US elections and the stability of cryptocurrencies. Alden explores potential shifts in global currency dynamics, emphasizing the rise of alternatives to the dollar and the risks posed by centralization in the banking sector.

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INSIGHT

Impact of Fed Actions on Banks

Small and medium-sized banks face profitability pressure due to the Fed's liquidity withdrawal.
The Fed might have reached its tightening limit, leading to a sideways balance sheet trend.

INSIGHT

Market Phase Change

The market faces a potential phase change, moving from constant tightening to a sideways trend.
This shift impacts liquidity-sensitive assets like Bitcoin and gold.

INSIGHT

Mixed Market Outlook

The current market situation presents a mixed outlook, making it difficult to determine bullish or bearish trends.
Liquidity-sensitive assets might benefit, but recessionary risks still affect profit-making assets.

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Lyn Alden is one of crypto’s favorite macro commentators and also a frequent returning guest to the Bankless program. When Lyn comes on Bankless, you know it’s because Macro is confusing, and we need help navigating these chaotic waters.

Inflation! Bank run! Insolvency! Recession! Everyone’s yelling things! But what’s going to happen? Lyn has the answers.

------ ✨ DEBRIEF | Unpacking the episode: https://www.bankless.com/debrief-lyn-alden ------ In today’s episode, Lyn covers whether or not the Fed Balance sheet is expanding to infinity, what’s even on the Fed Balance sheet, how the Fed actually works, why a regional bank crisis might domino to the Dollar losing world reserve currency status, and how that same bank crisis might impact the 2024 US Election.

This is a Lyn Alden episode you don’t want to miss.

------ Topics Covered

0:00 Intro 5:09 Summary of Last Few Weeks 6:19 Speed Bump or Phase Change? 7:55 Nobody Knows What Happens Next 10:10 The Balaji to Ben Spectrum 18:14 Fed Balance Sheet Timeline 24:08 Run on the Fed? 31:05 U.S. Treasuries Value 41:31 Impact of the Economy Post-Sucking 47:31 Innovation Damper 49:18 Rethinking the Dollar’s Role in the World 52:52 Bull Case for Non-U.S. Dollar Supremacy 57:38 More Division in the Economy? 1:01:38 Loss of the Dollar? 1:08:00 Reserve Currency Predictions 1:12:47 Bitcoin Liquidity Profile 1:15:46 What Do We Do Lyn? 1:18:14 Is Crypto the Ultimate Tail Risk? 1:20:19 Closing & Disclaimers

------ Resources:

Lyn Alden Twitter https://twitter.com/LynAldenContact

Lyn Alden https://www.lynalden.com/

Links to our recent macro series https://youtu.be/pP_HHE0kFhA https://youtu.be/E8lxrsF29u0 https://youtu.be/-DzY_pCFGbI https://youtube.com/live/eregdZPLYjg

----- Not financial or tax advice. This channel is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This video is not tax advice. Talk to your accountant. Do your own research.

Disclosure. From time-to-time I may add links in this newsletter to products I use. I may receive commission if you make a purchase through one of these links. Additionally, the Bankless writers hold crypto assets. See our investment disclosures here: https://www.bankless.com/disclosures