Luke Gromen joins to discuss what he calls a once-in-a-century monetary reset.
Gold and Bitcoin have become the leading assets of 2025, not by chance, but because sovereign debt is no longer risk-free.
The 2022 seizure of Russian reserves marked a “1971 moment in reverse,” forcing nations back toward hard, neutral assets.
Luke traces this shift to post-WWII policies that elevated debt to rebuild the world, policies now collapsing under imbalances, demographics, and AI-driven deflation.
The result: a weakening dollar, gold on track to surpass Treasuries, and Bitcoin as “the last functioning smoke detector” of global finance.
All Roads Lead to Gold (and Bitcoin)
Given the fiscal situation, gold benefits regardless of scenario: higher or lower rates, war or peace, trade deals or conflicts.
Bitcoin is more correlated with risk assets short term, but long term shares the same “neutral reserve” qualities.
Both assets outperform because long-term sovereign bonds are no longer risk-free in real terms.
Post-2022 sanctions on Russian reserves catalyzed this recognition worldwide.
The New Bretton Woods: Neutral Reserve Assets Return
Luke views the 2022 reserve seizures as equivalent in scale to Nixon closing the gold window in 1971.
Central banks have since been buying ~1,000 tons of gold per year, pushing gold past the euro as the second-largest reserve asset.
Within 1–2 years, gold could surpass Treasuries as the top reserve holding.
A system where currencies float against neutral assets like gold and Bitcoin is taking shape, marking a return to trade settlement discipline.
Luke’s Journey: From Gold Maximalist to Bitcoin Realist
First bought Bitcoin in 2013 but treated it as a curiosity compared to his larger gold allocation.
Initially dismissed Bitcoin as a bubble in 2017, reinforced by the introduction of futures.
The 2020 breakout above prior highs convinced him it was not a bubble but a currency crisis in dollars.
Shifted part of his gold allocation into Bitcoin, then rebuilt both positions—today holds conviction in both.
Calls Bitcoin “the last functioning smoke detector” of monetary excess, doing what gold would if it weren’t suppressed by paper derivatives.
Policy, Stablecoins, and the U.S. Strategy Shift
Luke critiques the failed “Doge” trade strategy but notes the Trump administration course-corrected with stablecoin legislation.
Stablecoins soak up Treasury demand, effectively tying Bitcoin’s fate to U.S. fiscal needs.
To inflate away debt without revolution, governments must give citizens access to scarce assets. Bitcoin ETFs provide this channel.
A rising stablecoin market cap (projected into the trillions) is incompatible with stagnant Bitcoin prices; policy now implicitly supports higher Bitcoin.
Subjugating the Fed and financing deficits via pegged rates mirrors WWII-era financial repression.
Productivity, AI, and the Endgame for Debt
Nationalizations in semiconductors and defense reflect urgency but lack long-term planning for labor and infrastructure.
AI represents an even deeper incompatibility: exponential deflation cannot coexist with a debt-based monetary system.
Luke and Jeff Booth agree the only resolution is full reserve of debt on central bank balance sheets; tens of trillions printed.
Outcome: massive currency debasement, where owning gold and Bitcoin is essential to preserve purchasing power across generations.
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