🟢 [E7267] Gromen identifies Great Power competition driving '100-year currency system changes,' citing China's structural shift toward CNY-oil settlements with Russia reducing need for UST reserves. China's FX reserves as % of GDP have fallen from 50% to 20%, representing structural decline in foreign UST demand just as US deficits surge. Quote attributed to Xi Jinping: 'Right now there are changes, the likes of which we haven't seen for 100 years.'

🟢 [E7268] Structural USD debasement is viewed as the inevitable policy choice as UST market dysfunction forces massive liquidity injections. China's declining FX reserves (50% to 20% of GDP) and shift to CNY-denominated oil purchases reduce structural foreign demand for USD assets, while rising US deficits require ever-larger buyer pools, creating a fundamentally bearish USD setup.

🟢 [E7264] Treasury market liquidity has deteriorated to crisis levels as of March 2023, with unprecedented intraday volatility (10Y and 30Y prices moving a full point within one minute). Foreign holders possess $7.3 trillion in USTs, but only $450 billion of foreign selling in 2022 caused severe dysfunction, signaling structural fragility that required emergency Fed USD swap line interventions.

🟢 [E7269] FFTT recommends a barbell of elevated cash/short-term USTs alongside elevated hard assets (gold, gold miners, energy commodities, Bitcoin, industrial equities). The thesis holds that physical economy assets will outperform financial assets as USD liquidity injections occur despite above-target inflation, creating an inflationary environment that favors tangible over financial assets.

🟢 [E7272] Energy commodities are included in FFTT's recommended barbell alongside gold and Bitcoin. China's ability to now buy Russian oil in CNY represents a structural shift in global energy trade settlement away from USD, which simultaneously reduces UST demand and supports commodity pricing power in an environment of forced USD liquidity injections.

🟢 [E7266] FFTT recommends a barbell approach with elevated gold, gold miners, and Bitcoin positioned as 'bonds of finite issuance and infinite duration' versus infinite-issuance sovereign debt. Physical gold and Bitcoin are viewed as superior to long-duration sovereign bonds because they lack counterparty risk in an environment where contract sanctity is eroding (Russia reserve freezes, Credit Suisse AT1 writedowns).

🟢 [E7273] Gromen warns that banking credit contraction is spreading from regional bank failures (SVB) to commercial real estate (CRE), residential mortgage-backed securities (RMBS), and life insurers, describing a contagion chain through the credit system. The Credit Suisse AT1 writedown precedent further undermines trust in credit instruments, potentially accelerating the contagion.

🟢 [E7265] Gromen argues USD liquidity flood is inevitable because the Fed faces a 'hostage situation': either weaken the USD dramatically through massive liquidity injections despite above-target inflation, or foreigners will aggressively sell USTs causing systemic market dysfunction. The US economy's dependence on asset price inflation for GDP and tax receipts makes the inflationary choice unavoidable.

🟢 [E7270] Banking stress is metastasizing from regional banks (Silicon Valley Bank failure) across credit markets to CRE, RMBS, and life insurers as of March 2023. Credit Suisse's forced UBS acquisition and the AT1 bond writedown precedent undermine confidence in all European debt securities, with Gromen warning the banking credit contraction could spread further across the financial system.

🔴 [E7271] Despite Bitcoin being in a bear phase context (post-2022 drawdown), Gromen positions Bitcoin as a structural beneficiary of the coming USD liquidity flood, describing it alongside gold as a 'bond of finite issuance and infinite duration.' The thesis challenges a continued bear phase view by arguing forced Fed liquidity injections will be a major catalyst for Bitcoin appreciation.

💬 [E7275] FFTT recommends a specific barbell portfolio construction: elevated cash and short-term USTs on the defensive side, paired with elevated allocations to gold, gold miners, energy commodities, Bitcoin, and industrial equities on the offensive side. This positions for both near-term deflationary banking stress and the ultimate inflationary resolution through forced USD liquidity injections.

🟢 [E7274] Gromen frames the current environment as a 100-year structural regime change in the currency system driven by Great Power competition. The 'Angell Paradox' framework ('you loot, you lose') argues that breaking contracts selectively—freezing Russian reserves, Credit Suisse AT1 writedowns—destroys the legal certainty essential for cross-border commerce, fundamentally shifting the regime toward assets without counterparty risk.

💬 [E7276] China's strategic positioning is highlighted not as an equity opportunity but as a geopolitical driver: China's FX reserves fell from 50% to 20% of GDP, and its ability to purchase Russian oil in CNY structurally reduces UST demand. This represents China's deliberate de-dollarization strategy that affects the entire global macro environment rather than a direct Chinese equity thesis.