New Opportunities in a New World
In 2022, Russian President Vladamir Putin addressed the plenary session of the 25th St. Petersburg International Economic Forum. The theme of the forum was, “new opportunities in a new world.” Given the theme, Putin’s address was right on point.
Putin told the forum that:
“According to the IMF, global currency reserves are at $7.1 trillion and €2.5 trillion now. These reserves are devalued at an annual rate of about eight percent. Moreover, they can be confiscated or stolen at any time if the United States dislikes something in the policy of the states involved… According to analyst estimates—and this is an objective analysis—a conversion of global reserves will begin… They will be converted from weakening currencies into real resources… Other countries will be doing this, of course. Obviously, this process will further fuel global dollar inflation.”
Putting aside personal views regarding Putin, in HAI‘s view the above quote is spot-on. It fully captures the most important fundamental factor at dead center bullseye of the new global macro regime.
De-dollarization at the sovereign level is catalyzing a shift from global dollar recycling to a new global gold recycling, while more recently at the global financial market level we are seeing an emerging mass capital rotation from financial assets into real, hard assets.
In fact, according to new data from the World Gold Council, as of the start of 2026, the value of gold held by foreign central banks now surpasses that of U.S. Treasuries for the first time in 30 years. Similarly, we are now seeing massive secular relative performance breakouts from decade-long bases for gold, silver, precious metals miners, and copper miners, all versus the S&P 500.
In other words, dollar reserves are being exchanged for gold as the preferred reserve asset at the sovereign central bank level. At the same time, investor capital is flowing out of the S&P 500 into hard assets and the companies that mine them.
In 2022, Putin wasn’t posturing. He was accurately describing a now-unfolding global monetary regime change and resulting financial market paradigm shift. He was describing the coming capital conversion from “weakening currencies into real resources.” That conversion is clearly underway. Further, the trend is accelerating as recognition grows.
Last week, the U.S. essentially took control of Venezuela and, by extension, the world’s largest proven oil reserves. Importantly, in the preceding years China had invested significant sums of U.S. dollars (that it earned through global trade) into Venezuela and its oil assets.
In other words, the U.S. just confiscated natural resources China had already invested its dollar reserve capital into. So the U.S. action, seemingly to secure Venezuelan oil reserves, is in effect similar to (a real asset version of) the seizure of Russian dollar FX reserves in 2022.
In 2022, the U.S. seizure of Russian dollar FX reserves served to turbocharge the global de-dollarization effort. In HAI‘s view, the 2026 U.S. seizure of Venezuelan oil reserves (and Chinese investments in foreign natural resources) is very likely to have a similar effect—it should accelerate the global drive towards de-dollarization.
Due to U.S. action in Venezuela, global capital will likely move secularly into gold even faster. Incentives are rapidly growing for global capital to be stored in a neutral reserve asset held safely inside a nation’s own borders. Furthermore, in a world already moving away from the petrodollar and toward gold recycling, gold is increasingly the most trusted high quality net settlement asset facilitating global commodity trades.
In 2026 we are seeing the modern world of paper financialization primacy revert to the old world of dominant physical reality. Putin described the new (albeit old) global rules eloquently in 2022. Now, the U.S.—through recent industrial policy and natural resource investments and the securing of Venezuelan oil reserves—is seemingly acknowledging Putin’s point and acknowledging that scarce physical resources are more valuable than printed paper. The world is watching. The world is de-dollarizing. And the world is re-embracing the timeless physical currency that is gold.
The fresh secular breakouts of key hard assets versus financial assets strongly argue that the trend Putin described is far from old; it’s just getting started. Hard assets are indeed the “new opportunities in a new world.” In HAI‘s view, portfolios need to adjust accordingly. Most investors still dramatically underestimate the scale and scope of this new opportunity in this new world.
Weekly performance: The S&P 500 was up 1.57%. Gold was up 4.08%, silver gained 9.26%, platinum was up 6.32%, and palladium gained 12.42%. The HUI gold miners index was up 8.87%. The IFRA iShares US Infrastructure ETF gained 2.47%. Energy commodities were volatile and mixed on the week. WTI crude oil was up 2.55%, while natural gas was off 13.21%. The CRB Commodity Index gained 1.23%. Copper was up 2.67%. The Dow Jones US Specialty Real Estate Investment Trust Index was higher by 1.01%. The Vanguard Utilities ETF was down by 1.21%. The dollar index was up 0.72% to close the week at 99.14. The yield on the 10-yr U.S. Treasury was off 2 bps to close the week at 4.18%.
Have a wonderful weekend!
Morgan Lewis
Investment Strategist & Co-Portfolio Manager
MWM LLC
