Many Happy Returns The Debasement Trade: Faith, Fear, and the Fall of Fiat?
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Oct 22, 2025 The surge of gold and silver prices is raising eyebrows. Investors are increasingly questioning the stability of fiat currencies, leading to a shift toward precious metals and crypto. Skepticism from major strategists adds to the debate about the so-called 'debasement trade.' The hosts dissect the implications of rising debt and political constraints that can impact fiscal policy. They explore the fine line between stimulating the economy and debasing currency, while offering insights into practical investment strategies in this evolving landscape.
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Debasement Trade Explained
- The 'debasement trade' argues rising government debt erodes faith in fiat, pushing investors to gold and crypto.
- Hosts view it as a popular narrative but question whether it's a lasting structural shift or momentum-driven mania.
Old Coppernose Example
- Ramin recounts historical debasement where monarchs mixed coins with base metals to reduce value.
- He uses Henry VIII's 'Old Coppernose' as a vivid example of literal currency debasement.
Fed Dovishness Fueled Gold Rally
- Gold's recent surge coincided with dovish signals from the Fed and expectations of rate cuts.
- The mid-August Powell remarks at Jackson Hole acted as a clear catalyst for gold's leg up.