GM03: The Dollar losing its Reserve Currency Status ft. Erik Townsend

Todays’ guest is Erik Townsend, host of the Macro voices podcast. Erik has an unusual background, as he had a very successful career as a technology entrepreneur before turning his hand to commodity trading. His background gives him a different perspective to many in the financial world, as we discovered in our conversation. Our discussion explored the possible consequences of the action taken by central banks in the last and current crisis; including rampant inflation, social unrest, and the overthrow of the dollar as the worlds reserve currency. As Erik said towards the end of our conversation “Put your seatbelt on, there could be some rough turbulence ahead”! Topics Discussed in this Episode MMT Inflation outlook & inflation hedging QE "Most of that money that was conjured out of thin air by central banks didn't go to Main Street to provide more money in the pocket of the average consumer, it went to put more money in the pocket of the average investment banker to buy more assets." China & Russia “If you are China and Russia, first of all, you don't care about votes because you rule through fear and intimidation, not through democracy. What you care about is shifting power from the west back to the east.” Civil unrest & revolution "The current system, which is more cronyism than capitalism, the people of the world are pissed off. They're sick of it. I think that what we'll see over the next ten years is a major change." Digital global reserve currency " I think that we'll eventually see the emergence of a digital currency that really gives the U.S. dollar a run for its money for the title of Global Reserve Currency. That's going to be what changes the Fed's ability to get away with what it has been doing." Coronavirus Links Catch up with Erik Townsend and learn more about his work: MacroVoices Book: Beyond Blockchain Follow Niels, Moritz, & Rob on Twitter: Niels Kaastrup-Larsen Moritz Seibert Rob Carver Subscribe on: Full Transcript The following is a full detailed transcript of this conversion. Subscribe to the podcast to get access to all of our transcripts as eBook downloads! Erik I published a book in 2018 predicting that the eventual replacement for the U.S. dollar would be a digital currency and I don't think it's cryptocurrencies like bitcoin. I think the cats out of the bag that digital currency is going to be the way of the future. The question is going to be what country or block of countries come up with the digital reserve currency that really provides a viable alternative to the U.S. dollar? How does that event come about? It's not something that happens next week or next month. In the next decade, I think that we'll eventually see the emergence of a digital currency that really gives the U.S. dollar a run for its money for the title of Global Reserve Currency. That's going to be what changes the Fed's ability to get away with what it has been doing. Introduction For me, the best part of my podcasting journey has been a chance to refine my own investment framework through a series of conversations with extraordinary investors in every corner of the world. In this series, I along with my co-hosts Robert Carver and Moritz Seibert, want to continue our education by digging deeper into the minds of some of the thought leaders when it comes to how the world economy and global markets really work to try and learn how they think. We want to understand the experiences that have shaped them, the processes they follow, and the historical events that have influenced them. We also want to ask questions outside our normal rules-based playground. We’re not looking for trade ideas or random guesses about an unknown future but rather knowledge accumul...