Gammon argues the dominant “dollar is crashing” narrative is wrong and that the DXY’s reading near 99 is artificially suppressed because the BOJ is defending the yen at 160 (a non-market level he thinks would otherwise be 200-210), masking a much stronger dollar that is acting as a “wrecking ball” crushing Asian currencies like the yen, Indian rupee, Korean won, and Philippine peso. He contends a strengthening dollar could paradoxically trigger an empire-style collapse by decimating foreign trading partners (his “sea peoples”/Ramesses III analogy), that gold is not an inflation hedge but a long-term store of value and liquidity source that prices counterparty risk, and that private credit is the new subprime capable of producing a GFC-style psychological contagion. His positioning is dollar-bullish over 6-12 months, with 10% in gold as insurance and a long position in DXJ (yen-hedged Nikkei), and he predicts gold could dip from $4,500 toward $3,800 in a private-credit blowup before ripping to $7,500 a year later.
The yen-distorted DXY: Gammon claims the BOJ’s defense of the yen at 160 (roughly 13-14% of the DXY) makes the index understated, and that a true market yen near 200 would put the DXY closer to 105-110, completely flipping the bearish dollar narrative. Turkey’s central bank dumping its treasury holdings from $15 billion to near zero to defend its currency is, in his view, a symptom of this same dollar pressure.
The dollar wrecking ball on Asia: He argues energy is inelastic, so oil-importing nations facing a rising dollar must sell assets and then debase their own currencies, creating a “doom loop”; the US is insulated because its expenses are dollar-denominated while foreigners face both oil price and FX risk. He warns a strong-dollar collapse of trading partners could backfire on the US itself by destroying the counterparties America needs to buy from and sell to.
Gold as store of value, not inflation hedge: Gammon insists charts show gold’s correlation to CPI, debt, and the DXY is “at best a coin toss,” and that gold’s only consistent short-term driver is counterparty risk while its long-term role is preserving purchasing power (an ounce buys a suit now as in 1900). He recommends a permanent ~10% allocation as insurance, not speculation.
Credit mechanics and the dollar: He explains banks, not the Fed, create dollars by lending them into existence, so global credit expansion weakens the dollar (as in 2000-2011 when the DXY fell from ~120 to ~70) while contraction strengthens it. He says paying off all dollar debt would leave literally zero dollars, and points to the flat 2s/10s curve (40-45 basis points) as his key signal, warning a bearish steepener to a 150-basis-point spread would flip him dollar-bearish.
Private credit as the next subprime: Gammon contends private credit is uncontained and could trigger a GFC-style freeze through pure psychology, noting only ~5% of mortgages actually defaulted in 2008 yet the collateral panic froze the system. He cites a multifamily operator (“Kenny”) describing developers funded at $350/sq ft via private credit who should have built at $250, plus mark-to-model games where firms sell loans to their own subsidiaries at 98 cents on the dollar to avoid honest pricing.
Shapiro argues that the post-Cold War shift from 1990s optimism to today’s fractured “1930s-style” politics was not inevitable but the product of avoidable choices reducible to one word: unilateralism. He makes the case that the West squandered a historic opportunity to fold Russia into NATO and the EU (Yeltsin and early Putin both wanted in) by instead expanding NATO eastward, calling George Kennan’s “fateful misjudgment” verdict spot-on, while neglecting a Marshall Plan for Russia that pushed Yeltsin toward the oligarchs and “gangster capitalism.” He traces a “thin end of the wedge” from the 1999 NATO bombing of Yugoslavia (the first major action without Security Council authorization) through the post-9/11 toppling of the Taliban and the Iraq invasion driven by a neoconservative empire-building agenda, with the Afghanistan and Iraq wars alone costing over $4.3 trillion and the broader war on terror reaching roughly $8 trillion by 2020. He contends the 2008 financial crisis shattered both the international Washington Consensus and domestic elite legitimacy, and that the resulting hypocrisy (bank bailouts and Goldman bonuses amid austerity) bred the cynicism and zero-sum worldview that ultimately produced Trump.
Unilateralism as root cause: Shapiro reduces the book’s argument to one word, defining it internationally as the refusal across the Bush, Clinton, and second Bush administrations to radically refashion Cold War structures. He stresses this is not hindsight, since figures from Nixon to George Kennan, Sam Nunn, Mitterrand, and Genscher argued against the path actually taken at the time.
The missed Russia opportunity: He argues NATO should have been disbanded or included Russia from the start, noting Yeltsin was “desperate” to integrate and Putin angled to join NATO and the EU during his first three years. Clinton instead expanded NATO (Poland, Hungary, Czech Republic joining in 1999) partly to court Polish, Hungarian, and Czech voters in swing states like Wisconsin, Michigan, and Pennsylvania after Gingrich’s 1994 takeover.
Gangster capitalism and neglect: Shapiro contends Clinton, focused on paying down Reagan-era debt, refused to spend political capital on a Russian Marshall Plan and dribbled out aid, driving Yeltsin to the oligarchs via schemes like “loans for shares.” By 2003 Putin had prepaid most debt and built a $160 billion rainy-day fund, insulating Russia by the time it could push back.
9/11, the neocons, and Iraq: He argues toppling the Taliban was a choice, not a necessity, since generals wanted 3,000-5,000 special forces to target al-Qaeda while Mullah Omar had been trying to expel them; instead the US backed the losing Northern Alliance and created a failed state. Fringe neocons like Wolfowitz, Cheney, Rumsfeld, and Pearl (Project for a New American Century signatories) seized control after 9/11, pursuing democracy “at the point of a gun” on the false assumptions it could be cheaply created and would be pro-American.
2008 as dual inflection point: Shapiro frames the crisis as ending the perception that the US ran the global economy, opening space for China’s Belt and Road and the “Beijing consensus,” while Greenspan stood “in stunned disbelief” and elites reached for the Keynesian tools they had denounced. He emphasizes the hypocrisy of bailing out banks and paying Goldman bonuses (averaging around $600,000 per employee) amid austerity as the trust-breaking catalyst that cleaved American society and led toward Trump in 2016.
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