There is a survey almost nobody reads called the OMFIF Global Public Investor. It polls the people who manage central bank reserves, which is the least emotional job on earth. In 2024, four percent of them named geopolitics as the most important factor in their allocation decisions. One year later it was thirty-one percent. Seventy percent said they were increasingly concerned about the American political environment.
Reserve managers do not write op-eds. They move money. And in 2025, for the first time since the mid-1990s, gold passed U.S. Treasuries as a share of global central bank reserves. Twenty-seven percent against twenty-two, according to the ECB's own report.
That is what an exit looks like when professionals do it. No summit, no announcement, no vote. Just a lot of quiet people deciding they would rather hold a rock than a promise.
What they are looking at
I listen to the headlines too.
In February the Supreme Court ruled six to three that the president could not levy tariffs under emergency powers. Separation of powers, Article I, the taxing authority belongs to Congress. A win for the rulebook. Within hours the White House announced ten percent across the board under Section 122 of the Trade Act, then raised it to fifteen. Section 122 expires in 150 days unless Congress votes to extend it. Congress could have voted. Congress did not care to be on the record five months before a midterm. So the administration moved to Sections 232 and 301, and the machine was running again.
The rule was upheld. The policy never stopped. The whole problem right there in that sentence.
Meanwhile there is a war that began on the last day of February with a decapitation strike, followed by a closed Strait of Hormuz, a naval blockade, a June memorandum of understanding that nobody is honoring, and commercial ships taking fire in July. Roughly a fifth of the world's oil moves through that strait. Anybody who lived through 2020 and watched a container backup in Long Beach become empty shelves in Harrisburg understands what a chokepoint does to a supply chain. Analysts had flagged that scenario for decades. The Strategic Petroleum Reserve was not full when it started.
And the allies. Denmark's intelligence service wrote in its annual outlook that the United States is using economic power, tariff threats included, to assert its will, and that the use of force against an ally can no longer be ruled out. That is a NATO member's professional intelligence assessment of the United States. Canada's prime minister said much the same thing out loud at Davos, that Washington now treats economic integration as a weapon and financial infrastructure as coercion. Nobody in the room disagreed.
It is not the man
Here is where I part company with most of what I read.
Nearly everything written about this treats it as a character problem. Get the bad guy out, put a competent adult back in, restore the norms. I have spent thirty years walking into organizations after somebody blew something up, and I will tell you the thing nobody wants to hear on day one: if the wreck was possible, the wreck was designed in. A system that produces a catastrophe when the wrong person takes the wheel was always going to produce that catastrophe. You just had not met the wrong person yet.
The Federal Reserve is the cleanest example. In January the administration went after the Fed chair personally, and it went to the Supreme Court over firing a sitting governor. The Fed's independence held. Everybody exhaled. But look at what held it. Particular people refused to move. A court happened to rule a particular way. Markets shrugged. Fed independence is a norm, a habit, roughly seventy-five years of everybody agreeing to behave. There is no mechanism underneath it. Nixon leaned on Arthur Burns in 1971 and Burns folded, and we bought a decade of stagflation with that. Nothing structural changed afterward. We simply agreed not to do it again.
We have been running the world's monetary system on the personal restraint of whoever happens to hold the office. That worked exactly as long as the office holders were restrained. That is not a system. That is a streak of good luck.
The privilege and the temptation
Giscard d'Estaing called it the exorbitant privilege, and it is one. The country that issues the reserve currency borrows cheaper than anyone, buys imports with money it prints, and gets to watch everyone else's transactions go by.
What does not get said is that the privilege is also a standing temptation, and the temptation compounds. When you own the pipes, every dispute starts to look like a plumbing problem. Sanction the bank. Freeze the reserves. Cut the country out of the messaging network. Each move works. Each move also teaches every finance minister on the planet the same lesson: your reserves are a hostage.
We froze Russia's reserves in 2022. I do not need to relitigate whether that was justified. The second-order effect was not a mystery to anybody who thought about it for ten minutes, it does not appear to have been modeled, and it has been running ever since. Central banks have been net buyers of gold for sixteen straight years, the longest streak on record, and the buying went vertical after 2022. Turkey added 220 tonnes following the invasion, then sold or loaned 130 of them within months of the Iran war starting, which the ECB called one of the largest reserve drawdowns in years. Tether, a stablecoin issuer, bought more gold in 2025 than any central bank did.
I remember when this government considered second- and third-order effects before it acted. That work is boring. It makes terrible television. And we are being governed by people who have never built anything that was not television.
A hundred years of the same discovery
I have spent the last several years writing about people who tried to fix this, going back a century. Wilhelm Ostwald arguing that value should be measured in energy. Silvio Gesell. The Technocrats. Keynes and White at Bretton Woods. Robert Triffin, who saw the contradiction in 1960 and put his name on it. Nixon closing the gold window. Hayek proposing in 1976 that we take the currency away from governments entirely. The Cypherpunks in the nineties.
Every one of them was chasing the same thing. Every one of them failed the same way. They designed a rule and then handed it to a ruler.
Bretton Woods had a rule. The rule was thirty-five dollars an ounce, and it lasted until a Sunday evening in August 1971 when it became inconvenient, and then it did not exist anymore. A rule a person can suspend isn’t a rule's. That distinction is most of monetary history, and we have spent a hundred years declining to learn it.
Unwinding
I have some experience unwinding a cluster fuck. The first step is always the same and it is never the technical one. Somebody has to admit that something is wrong. Not concede it, not spin it into a strategic realignment. Admit it. And it has to be done humbly, which is a word people throw around without meaning much. Teresa of Ávila defined humility as walking in truth, and that is the only definition I have ever found operationally useful. It is not about thinking less of yourself. It is about describing the situation accurately, your own part in it included.
We will not get that from this administration. Whoever picks up the reins next inherits a problem that has been compounding for eighty years and accelerating hard for four, and every instinct will tell them to grab the wheel. Restore the norms. Rebuild the alliances. Get the right people back into the right chairs. All of it is worth doing and none of it fixes the thing, because the next wrong person is already out there somewhere and the chair will still be a chair.
The actual move is to give up the wheel.
A neutral reserve asset, one that no government issues and no government can freeze, takes the temptation off the table permanently. Not because it is virtuous. Because it has no discretion to abuse. Bitcoin is the only real candidate on the field, I have written a book about why, and I am aware of every objection: the volatility, the energy argument, the concentration of holdings, the fact that a great many of its loudest advocates are insufferable. Those are real and I am not going to wave them off in a closing paragraph.
But watch what the reserve managers are already doing. They are not waiting for a philosophy. They are buying rocks. Gold is the analog version of the same instinct and it appeals for exactly the same reason. Nobody can call it back.
"America First" was never wrong because of the word first. It was wrong because the people saying it thought first meant in charge. We were first because everyone else chose, every day, in thousands of offices in dozens of countries, to hold our paper. A choice made that way can be unmade the same way. It is being unmade right now, four percent to thirty-one percent, and nobody had to declare a thing.
Rules without rulers. It is the only arrangement that has ever held.