Saxo Bank boldly predicts that 'Trump 2.0' will destroy the dollar. The bank believes that as the Trump administration disrupts the global financial system with huge tariffs, the entire world is scrambling to find alternatives to the dollar.
According to the Zhituo Finance APP, Saxo Bank makes some outrageous predictions every year, which, while reasonable, are unlikely to happen. For example, Saxo Bank predicted last year that Robert F. Kennedy would be elected president of the usa, oil prices would reach $150 per barrel, and GLP-1 drugs would derail the fitness industry. Undoubtedly, all these predictions missed the mark, which has made investors appropriately cautious about the bank's new predictions.
In response, Saxo Bank's chief macro strategist John Hardy stated: 'Saxo Bank's 'outrageous' predictions are not necessarily all accurate, but they can stimulate our thinking and give us a more comprehensive understanding of the future.'
This year, Saxo Bank boldly predicts that 'Trump 2.0' will destroy the dollar. The bank believes that as the Trump administration disrupts the global financial system with huge tariffs, the entire world is scrambling to find alternatives to the dollar.
John Hardy pointed out that the globalist system formed after World War II is based on the usa providing security for the trade routes of the so-called 'free world' and using the dollar as the primary jiaoyihuobi and means of value storage. Even after usa President Nixon broke the link between the dollar and gold in 1971, the dollar continued to dominate the globalized economy.
However, after Trump took office in 2016, he became the first usa president in people's memories to criticize the foundations of the global system. Trump called for tariffs on imported goods to correct the usa's enormous trade deficit and condemned the costs associated with maintaining the usa's large security umbrella. Now, Trump is about to return to the White House. If 'Trump 1.0' was a warm-up for de-globalization, then 'Trump 2.0' will be the main event, with a comprehensive impact on the dollar.
John Hardy stated that by 2025, Trump's new government will completely change the usa's relationship with the world—imposing high tariffs on all imported goods, while significantly reducing the deficit with the help of a government efficiency department led by Musk. Trump weaponizing the dollar is terrible for global trade because it cuts off the dollar supply needed to maintain the operation of the global dollar system; ironically, this could lead to a significant rise in the dollar.
The strategist added that as global financial institutions compete to find alternatives, they will eventually discover a safety valve, with BRICS countries using gold-backed digital currency for trade, and europe increasingly basing its trade relationships on the euro. As the global financial market opens this dramatic new chapter, gold-linked crypto stablecoins will also join in.
It is worth mentioning that Saxo Bank's other 'outrageous' predictions include: nvidia's (NVDA.US) market cap will soar to twice that of apple (AAPL.US); the electrification craze will lead to the disintegration of OPEC; the usa will impose taxes on AI datacenters; and natural disasters will result in the first bankruptcy of a major insurance company.