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Economist and best-selling author Nassim Taleb says a single asset has overtaken the US dollar’s position as the world’s de facto reserve currency.
In a new interview with Bloomberg, the Black Swan author says that the US dollar has lost its status as a reliable safe-haven asset, noting that people prefer to invest in the stock market rather than hold a currency that declines in value over time.
He also says that America’s sweeping sanctions against Russia for its invasion of Ukraine marked the beginning of the end of the dollar’s reign as the world’s reserve currency. According to Taleb, gold is now the world’s reserve currency, highlighting that the dollar’s credibility eroded after America and its allies weaponized the USD.
“That would end up being reflected in stocks, the slow decline of the dollar, and effectively, there’s a second risk. The first one is the deficit, the second one is effectively that the dollar is losing its status as a reserve currency…
You can see the accumulation of gold in the reserves and the behavior of gold over the past 12 months. And it didn’t start with Trump’s policies. Of course, it started with Biden when he froze the accounts of people connected to Putin, and of course, thinking that it would be limited there, but people not connected to Putin decided to stay away from the euro and the dollar.
And gold is effectively now the reserve currency. Transactions take place in dollars and euros, usually dollars, and at the same rate, however, they get converted back into gold. And we can see that from the accumulation of reserves.”
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