Monetary reset: gold outflows, digital dollar and Fed pressure

0:00You literally have 11 days left. That's it. 11 days until a deadline that no one's really talking about. And it's going to hit the money in your bank account and in your portfolio, whether you're paying attention to it or not. The president of the United States gave the people who print your money, the Fed, an ultimatum.

0:19And the actual words, and I'll put it on the screen for you, is something like, "Lower the rate or I'll stop trading with countries with which we have a deficit. Lower interest rates or I start this incredible trade what we haven't seen." And he called high interest rates a very fair disadvantage and told the Fed to be patriots. And this ultimatum comes to you on September 16th. That's the day the Fed walks into a room to decide interest rates, which the market is currently expecting to go up. He wants them to go down.

0:54But something much stranger and bigger is actually happening at the same time. And that's why I really wanted to put this out for you. I apologise the audio might be a bit windy and so on, I'm on the beach. But there are pallets of actual gold being loaded onto planes and flowing out of America right now. Country after country pulling their gold home for the first time since 1971.

1:16And the last time a president leaned on the money printer while the world pulled his gold out, what happened to the dollar? Well, that's what we're going to cover today. This isn't ancient history. It's literally a playbook that we've seen again and again, and it's literally happening again right now. And I don't care whether you love Trump or you can't stand him, forget your politics. That's not what this is about.

1:39Because when the printer starts answering to the politicians, the people who understand it early do really well. But everybody else spends a decade or two watching their money shrink, which is what we've seen in the 70s and again after Covid, right? How is inflation feel to you right now? So the Trump thing is the loud noisy thing, it's in the news. But there are four much quieter things that are happening at the same time and people are not connecting them. And that's really why I wanted to put this out for you guys because I want you to understand this. It's really important.

2:09The system itself, the plumbing under your bank account, your pension, your 401k, is being reset right now, not sometime in the future. And I'll show you the data for it. Gold is walking out of American vaults. It's getting shipped home to Europe. The biggest, safest, most boring pile of money on Earth literally just announced it's dumping a chunk of America's debt.

2:3521 of the largest banks on the planet, think Goldman Sachs, Citibank, Bank of America, they teamed up and they're building a new dollar. And again, for some weird reason, it isn't in the news, but it's the biggest thing that's actually happening right now. And at the same time, Japan, the country that I covered a few weeks back that wiped $1 trillion off Wall Street, turns out that was not the earthquake. That was the first tremor, which is maybe not the greatest analogy referring to Japan. I love Japan, but there we are.

3:06So, 4 separate things, but they're actually all tied together. And by the end of this video, give me 10, 15 minutes or so, you're going to see the whole machine and how it actually works together and know what a regular normal person like you and me can actually do about it. So, we're not going to panic. We're not going to run for the bank. We're going to have a plan, right?

3:27My name is Felix Prehn. I'm sitting on the beach. I used to be a banker and I started teaching this stuff to regular people about 7 years ago and we've taught about 25,000 people over the last 7 years as my mentors doing the teaching. And none of this is sponsored and not ever endorsed by gold mine or any of that nonsense. Fair enough people do that but I'm very lucky I don't need to, so I can just give you my opinions. That's all this is. I'm not a financial adviser. And give you my opinions without any filter and that's really my goal here.

3:57So there's going to be a lot to cover here because we're having 4 or 5 things together and I'm going to put all of that together for you into a free report. You can download that. I'll do that after I have a dip. And you can download that at felixprehn.org/shift because that's really what this is. This is a shift in your portfolio quite frankly. felixprehn.org/shift. It's in the description. Download it. It's free.

4:23But the fact that you're even watching this so far is incredible because it puts you ahead of 99% of people because most will find out about this in a headline in about 6 months or 12 months. I'm going to get it into your brain today. So, give yourself credit for showing up and watching some financial education here because the trap most people are sitting in and don't even know it is this.

4:45When the world feels a bit shaky, you want to do something safe, right? And for 40 years, the safe thing is meant put your money in an index fund. That's generally the accepted gospel. Buy the S&P 500 and just don't think about it. It's diversified. It's America. It's always going up, right? Great.

5:00Except every single thing that I just show you attacks that very idea. The gold leaving, the debt being dumped, the digital dollar that's coming, it's all the world quietly saying the old safe isn't really all that safe anymore. And if the definition of safe is changing, the most dangerous thing you can own might be the very thing that you were told is the safest thing to own, right?

5:22And if you own the S&P 500, and most of you do, I do, everybody does, right? It's in your 401k, it's in your Roth IRA, it's in your pension, and so on, you feel like you're spread out and safe and diversified. But 40% of that is just 10 stocks. And this year, those same 10 stocks drove 72% of all your gains. So when someone says to you, I own 500 stocks on the S&P 500 and diversified, you actually don't. 72% of your returns are coming from just 10 companies.

5:54And guess who those 10 companies are? They're entirely AI companies. And those 10 companies are the most expensive, most crowded, most dollar dependent names on the planet at valuations we've never seen in the history of the world. Right at the moment the world is backing away from the dollar. And you don't have to believe me on that.

6:12By the way, 2 of the most careful, most respected value investors alive, the calm ones, the ones who are supposed to love a boring index fund, won't touch them. One of them, a man named Charlie Munger, called his best friend. One of them is Warren Buffett's own company. They quietly sold their S&P index fund, right? And he was telling everybody to buy that for decades.

6:30And the single most bullish voice on Wall Street, the man who called this entire rally year after year, is now warning of a 20% drop. So, you get the biggest bull and the most careful bears all backing away from it. And you might therefore want to know what to do about it as well.

6:46And that's what we're going to do, not this week, but the coming weekend when I'm probably no longer on the beach. I might still be, who knows? But I'm going to run a free live training. It's the first time we've run this. It's probably the most important thing we've done and probably the last time we're going to run it and it's called the index fund trap. Like why the S&P 500 is actually lying to you. We're going to do it live. We're going to do a real Q&A. You can ask me anything you want. I'll show you how to check your real concentration and all of that. And I'll show you where the smart money is going instead.

7:14Because when the smart money leaves those 10 names, it's going to go somewhere else, but it's going to leave the people who are in those 10 names that you're in pretty devastated. And it's completely free. No credit card, no cash, anything. It's just a part of what I love doing, which is teaching you how this really works. So, show up for yourself, right? I'm going to show up for myself in the comments down below. Claim your free seat. It's at indexp.com.

7:41But let me show you the machine that's happening right now so you understand more than most even before the week's out. So, let's start with gold because gold is kind of a lie detector of the financial world. Gold doesn't have earnings. It doesn't have a CEO. It doesn't tweet and all of that. All gold does is sit there and it tends to hold its value while paper money slowly loses it.

8:02And for 80 years a huge chunk of the world's gold has sat in one place. The vaults under the Federal Reserve Bank of New York. There is allegedly a tunnel to JP Morgan but that's a rumour I can't confirm. Anyway, so countries store their gold in America because America was the safest, most trustworthy place on the planet to keep it. That's basically the deal. But that deal is breaking.

8:24And look at what's actually happened here. The Netherlands pulled 86 tons of its gold out of North America and they shipped it to London. France finished pulling out 129 tons out of the New York Fed vaults. Germany moved about 300 tons of its gold home again out of New York.

8:39Central bankers will give you a very calm, very technical reason for it. Liquidity, preparedness, trading standards, blah. Yeah, okay, strip away the jargon. But the only question is this. Why, after 80 years of leaving your gold in America because it is the safest place on earth, would you suddenly go to all the cost and trouble and risk of physically shipping it home? Well, you only do that for one reason. You want it where you can put your hands on it. You want it out of somebody else's control.

9:08So this isn't some technical BS. It's a trust decision. The trust is breaking. Trust is leaving the building, literally on pallets and on planes. And if you think, okay, someone moved a bit of gold, so what? Well, let me tell you about a guy called Jan Nieuwenhuijs. I believe he's Dutch. He tracks this stuff obsessively, and he put out a reminder this week of what happened the last time this happened.

9:33You got to go back to 1971, the Netherlands, same country, funnily enough. They asked to convert $250 million they were holding into actual gold, because back then the dollar was basically backed by gold and you could swap one for the other. A young American official was sent all the way to Amsterdam to personally beg the Dutch not to do it. That official's name was Paul Volcker, a man who'd later become the most famous central banker in the history of the US. The head of the Dutch central bank refused. He wanted the gold.

10:07Volcker said to him, this is a real quote, "You're rocking the boat." And the Dutch chap said, "If the boat capsizes because I asked to swap $250 million for gold, then the boat's already sunk." So what happened next? A month later in August 1971, President Nixon went on television and slammed the gold window shut forever. He cut the dollar's link to gold completely because too many countries were showing up asking for the real thing America didn't have enough of.

10:34That one night is the reason your dollar today is backed by nothing but a promise and a money printer. That was the last great monetary reset. And it started with one small European country, the lovely Dutch, asking for its gold back. Sound a little familiar?

10:48But forget the history books for a second. There is the part that actually matters to you right now. What came after 1971 wasn't some weird economic footnote. The 10 years that followed were the great inflation of the 1970s. Prices roughly doubled. The value of the dollar in your pocket that you saved carefully, well, it evaporated. That's what a monetary reset actually feels like. It's not some dramatic crash on a Tuesday afternoon. It is a slow bleed, a little every month, and most people have no idea, no plan for it. They don't know it's coming.

11:26So for me, gold leaving the US is the smoke. But there is always a fire where there is smoke. And I think this is the most important bit I want to explain to you. When the US government spends more than it takes in, which is always, it makes up the difference by borrowing. And the way it borrows, it sells you IOUs. They call them treasuries because it sounds fancier, but they're IOUs. It's just a piece of paper saying America owes you money plus interest.

11:48Since World War II, the world has lined up to buy them because lending America money was the safest thing you could possibly do. And that constant reliable demand is what kept America's borrowing cheap. It's kept your mortgage rate low, kept your car loan, your credit card, all lower than it should be, and everything is tied to it.

12:10So watch what just happened. Norway, again we're in Northern Europe, they run the biggest sovereign wealth fund on the planet because they have a lot of oil. It's just a giant national savings account, $2.3 trillion, the most conservative big pool of money in existence. Norway just formally proposed cutting how much government debt it holds. They're going to slash it by about $80 billion of those US treasuries, those US IOUs. So you got the single most cautious large investor on Earth stepping back from America's debt.

12:44And there is something even more alarming. The list of historically reliable buyers of America's debt is getting longer. Japan, the Gulf States, Norway. The steady, dependable buyers who always showed up are just not showing up. So why should you care again? Isn't this some random thing in the financial world? Well, if fewer people want to lend America money, America has to offer a higher interest rate to tempt them. The same way you'd have to offer a better rate to borrow from a nervous friend.

13:13When America's interest rate goes up, yours goes up. Your mortgage goes up, your car payment goes up, the interest on the national debt goes up, the cost of building your infrastructure goes up, the cost of building data centres goes up. Everything is financed. So this is America's master switch behind every bit of your financial life, and the switch is being flipped.

13:37This is where Japan comes back. I'm not in Japan but fairly close to it, because a few weeks ago I talked about Japan a lot in a video on the yen. A lot of you watched that and I want to be very clear about something. That story was very real. It was a warning shot. For those of you who didn't watch it, going to give you a one-line summary. The United States spent a fortune propping up the Japanese currency and that briefly cracked a giant hidden trade on Wall Street and it wiped out about a trillion dollars of stocks in 40 minutes.

14:04But the point today is bigger. That Japan wobble wasn't a one-off Japan problem. It was the first place the pressure cracked, the weakest seam if you wish. But now we have gold walking away, we have Norway backing away, the president leaning on the Fed in a way that we've never seen before. So yes, different countries, different headlines, but it's the same machine groaning underneath the same weight. Once you understand all that together, you see this is not a coincidence. You line them up, it is the symptom of a system being reset. Japan was the start, but what I'm talking about today is the reality right now.

14:39So if the old system is straining, the gold's leaving, the debt buyers are backing off, the question is, well, what replaces it? And here's the part that unsettles me, because they are not actually hiding it. They're building the replacement in front of your eyes and it's just not making the news. I don't understand why it isn't making the news because it's the most important thing in the world.

14:59On September 1st, 21 of the largest financial institutions in the world, literally Goldman Sachs, Citi, Bank of America, UBS, and others, announced they're forming a company to launch a US dollar stablecoin. It's going to launch in 2027. Now, what's a stablecoin? Forget about crypto. It's got nothing to do with crypto. It's just a digital dollar. It's a dollar that lives on a computer network instead of in a paper note or a normal bank account. You can move it around the world instantly, 24 hours a day. There is nothing you need in between.

15:31There is an actual law called the GENIUS Act that lays out the rules for it. A euro version is being planned to follow. So for you Europeans, you're not safe either. And JP Morgan is not even joining that group. It's actually building its own. That's how important they think this is.

15:46Again, you might be thinking, well, why do I care? A dollar's a dollar, right? Well, here's why. Money that lives on a computer is money that can be tracked, moved, and managed in ways a paper note couldn't. Whoever builds the rails of the new dollar gets an enormous amount of say and power about how money flows, who can send it, how fast, and under what conditions. I'm not here to tell you that's good or bad today, although I'm obviously leaning towards the bad. I'm telling you that the people building it are the biggest banks on earth alongside the government. And you and I are not in the room.

16:23So when something this fundamental to your life gets built without you, the least you can do is understand and know it's being built and what it means. The dollar is being rebuilt into something digital by the lovelies on Wall Street. And I can tell you, when you build new infrastructure like that, there'll be winners and there'll be losers. The people who just keep their money parked in the safe old thing because nobody told them something new is happening, well, they tend to be on the wrong side of it.

16:50That brings us all the way back to September 16th, the deadline I mentioned at the top. The Fed decides on rates. The president has told them he wants a cut or else. Literally a threat. The one thing that's meant to make the dollar trustworthy, that's meant to make people want to lend the US government money, is that the people who print it are separate from the people who spend it. The Fed is supposed to be able to say no to politicians. That wall, as boring as it sounds, is a huge part of why the dollar is trusted and has been trusted for the last 80 years.

17:23So when a president stands up openly and puts pressure on the Fed to cut rates to juice the economy, and at the same time threatens trade war once again with its trade partners, well, people notice that. They think, well, if the printer now answers to the politician, how much do I really want to hold of this currency? So they buy gold, they trim their

17:42Treasuries and they build new digital things that they control, which is precisely the 4 things that we just watched happen. Can you start to see it? Put it all together. That's one machine. Trump leaning on the Fed, the gold going home, Norway stepping back, 21 banks building a dollar, Japan cracking. It isn't 5 things. It's actually just one thing. It is the slow, deliberate remaking of the money that you have and own. And it's not a forecast. I'm not telling you this is something that could happen. It's happening right now. It's already started.

18:13So what do you actually do about it? I'm not here to scare you. That's really not the goal. I'm not here to scare you and leave you sitting in the dark. My goal is to actually prepare you. And I want to be really clear before I say this. I'm not a financial adviser. This is not financial advice. I'm not registered with anything. It's just me telling you how to think about it. And bear in mind Winston isn't here, so who knows where I'm going to say it. I'm just going to tell you what I learned from my Wall Street mentors to help you then make your own decision.

18:40So first thing, don't hold too much of your life in cash. And I know that sounds backwards when things are scary. Keep an emergency fund, yes, 3 to 6 months of expenses. You could possibly hold that in short-term US debt essentially because the interest rates don't move much, but cash would also be okay. Some sort of savings account. But beyond that, cash is definitely the thing that's going to get taxed really badly by this money printing. When they print, the rates get pushed down to please a politician and the value of the paper in your account will leak guaranteed. Cash is an ice cube in this tropical climate.

19:17Second, own things that hold their value when the paper money comes under stress. Historically, that's meant hard things that can't be printed. Gold is an obvious one. Again, don't go 100% into gold. That'll be a silly thing to do. And there's another thing you can do, and that's what I also do. Pieces of genuinely great businesses, companies with what's called pricing power, which just means they can raise their prices without losing their customers. Inflation shows up, they ride it, they don't get crushed by it.

19:47Look at what the president just bought. He bought Visa and Mastercard. Not telling you to buy those, but those are those kind of businesses that have a very stable moat because, well, try launching a new credit card and getting into the hands of 300 million Americans. Good luck with that. So if you wish the place where I start with that research, it's the Winston app which is what I built for myself and I shared with you guys. Now you can go in there, you can click on stocks and you can pull up all the stocks. We show you scores for all the fundamentals, we show you the moat scores, the highest quality stores and so on. Again you got to come to your own conclusions, you got to do your own research, but it's a great place to start. That's what I do and I'll put a free one-month trial for you guys down there so you're not completely rudderless and you actually have a place to start your research. Again link is down below, if you don't like it just cancel it, it's completely fine.

20:33And look, you don't have to do all of this by tomorrow. You don't have to bet the house on a single idea. Don't run out and panic and sell everything. This isn't about going all in on gold or something. It's about not being 100% exposed to the thing that's most in the crosshairs. And it's giving yourself a few things that tend to hold up when the paper doesn't. Some small, sensible, maybe slightly boring moves that might make you a little bit calmer. That's really the whole thing. And I bought some railway stock in the last few weeks and stuff like that for exactly this reason. Boring, simple businesses that actually make money.

21:09And I'm going to walk you through what's writing on this, how we ride this thing, how we potentially come out of this to thrive. And we're going to do that live together, step by step, assuming zero knowledge. You don't need to be a genius at all for any of this. So everything we just went through, the gold on the planes, the debt being dumped, the digital dollar, the president leaning on the Fed, Japan cracking, it points to an uncomfortable thing. Is that what we've been told is the safest thing in the world to do, put your money into the index fund. Well, that index fund is riding on just 10 companies. 72% of all your gains in that index fund come from just 10 companies. And those 10 companies are the most expensive that any market has ever been. The most concentrated.

21:58And this reset, this shuffle in the markets, I think it's going to hit people pretty hard. Not today, not tomorrow. I don't know when. I'm not one of the doom and gloom predictor, but I'm just saying the warning signs are there. You don't get the US bailing out another country if the stock market is glorious and everything is wonderful. So that's what next Saturday is for. It's a free live training. It's called the index fund trap, why the S&P 500 is lying to you. And I'm going to show you live how to deal with it, where the careful money, the skilled money is moving instead. How to build a plan now before the headlines. It's completely free. It's just the financial education you should have always had.

22:33So grab yourself a seat at index.com. Links in the description. Write "show up" in the comments so we all know that you're going to show up for yourself. It might encourage one or two others to do the same thing. To me, the reset has started. The only question, and that's the one that really matters, is which side of this are you going to be on. Are you going to notice it now, are you going to be prepared now and come out a winner and thrive? Or are you going to be unfortunately like many people? And that's really why I do this. It's like I don't wish for people to go through what they went through in 2000, 2008. It was really painful for a lot of people and I think it's largely avoidable. So if you got some value out of this, show up for yourself, share it with somebody else who might get some value out of this too. And I thank you for watching.

23:15Right now I think we're going through some sort of weird phase transition. And normally when you get bad economic news or you get bad jobs data, people are going to fly to safety into the bond