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Don Coxe called it Financial Heroin twenty years ago.
I was lucky enough to trade research with the BMO strategist back then, and he saw the trap before anyone.
After 2008, central banks printed money to stabilize markets.
But in doing so, they created a dependency that would define the next fifteen years.
Zero percent rates became negative rates, and trillion-dollar deficits became standard operating procedure. Each crisis demanded bigger doses. Politicians promised the spending would generate growth that would pay down the debt.
That promise died eighteen months ago when the Fed started losing money for the first time in its history.
They’ve lost $200 billion so far.
The withdrawal has begun.
The Bill Nobody Can Pay
Every addict breaks their own limits, and Washington just did the same.
What began as an emergency tool has turned into a routine policy that goes like this: borrow more, spend more, then raise the limit again.
The ceiling is a formality and not a boundary anymore.
- Each new hike signals the same thing to the world: America’s debt machine has no brakes.
August started with the U.S. debt ceiling at $36.1 trillion.
Three weeks later, Congress raised it to $41.1 trillion. Five trillion dollars added with a single vote.
By October 10th, total debt hit $37.89 trillion.
The ceiling might as well not exist.
- This year, nearly $7 trillion in U.S. Treasuries mature. That’s nearly as much as the GDP of Japan and Germany combined.
Every bond rolling over gets refinanced at current rates, and the zero percent fantasy is dead. Look at his chart, and you see that more than half of America’s debt matures by 2028.
America is locked into paying double or triple the old rates on trillions of dollars.
- The United States now spends more servicing debt than funding its entire military.
Your 401k holds these bonds. Your pension owns them. Your bank’s reserves sit in them. When the world’s safest asset becomes its biggest liability, where does money run?
Portugal Knows the Answer
Central banks started their exit two years ago without press releases.
Portugal holds 84% of its foreign exchange reserves in gold. Four years ago it was 65%. France moved from 64% to 75% gold reserves since March 2021. Germany pushed to 77.5%.
Country by country, vault by vault, the world’s reserve managers are trading paper claims for metal.
From 2002 to 2010, central banks dumped 140 million ounces of gold.
After 2008 broke their confidence, they became net buyers every single year.
These are NATO members, EU founding nations and American military allies. These aren’t Russia or China.
They’re converting paper promises into metal at the fastest pace since Nixon closed the gold window in 1971.
- Twenty years ago, gold represented 14% of global reserves. Today: 24%.
By 2030, if current pace continues, gold would represent 27% of global reserves.
The Dollar’s Accelerating Exodus
The numbers tell a story no Fed speech can spin.
In 2001, the dollar was 72% of global foreign exchange reserves.
Here in 2025, it’s now 56%.
For 2027, it is projected to be 52%.
That chart shows a steady erosion of trust.
Central banks haven’t dumped dollars overnight; they’ve quietly diversified away from it year after year.
The rise of regional trade blocs, new payment systems, and tariffs all chip away at the US Dollar’s monopoly:
- China dumped roughly $370 billion in Treasuries since 2021.
- Saudi Arabia accepts yuan for oil.
- The BRICS payment system processes $4 trillion annually outside the dollar system.
When the world’s reserve currency becomes a funding mechanism for uncontrolled spending, nations find alternatives.
They don’t announce their departure on a loudspeaker.
They just leave one transaction at a time.
Silicon Valley’s Gold Rush
While central banks accumulate physical metal, tech giants bet on something different: tokenized gold that moves at internet speed.
Tether controls $180 billion in reserves and processes the majority of stablecoin volume.
Last quarter, they did something unprecedented. They took over $100 million in positions in gold-linked equity. It wasn’t ETFs and futures contracts, just direct stakes in companies positioned for gold’s tokenization.
Paxos already tokenizes $500 million in gold. JPMorgan moves billions in tokenized assets daily. BlackRock’s tokenized fund hit $1 billion in under a year.
- Physical gold solves the trust problem.
- Tokenization solves the speed problem.
When both merge, you get an asset that’s both ancient and cutting-edge. The company Tether quietly accumulated shares in sits at the intersection of both trends.
The December Deadline
The Fed meets December 18th and markets expect rate cuts.
But with $7 trillion refinancing at higher rates, any cut gets overwhelmed by the debt tsunami.
January brings the new Congress. The debt ceiling fight returns. The same politicians who raised it $5 trillion in August will perform the same show again.
Central banks aren’t waiting.
They’re buying gold at a pace that screams urgency.
Tether isn’t waiting.
They’re positioning for tokenized gold to replace Treasury bills as the crypto market’s reserve asset.
- Our November issue of Katusa’s Resource Opportunities reveals the company they’re betting on.
The same company positioned for both the physical gold surge and the tokenization revolution.
If you wait for this story to hit Bloomberg, institutional money will already own the entire float.
Subscribe to Katusa Resource Opportunities before November 30th and get our full report.
Learn how to get behind the paywall right here.
Because when central banks abandon their own currencies, you don’t want to be the last one holding paper.
Regards,
Marin Katusa
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