How amazing that the presidential campaign is less than two weeks away from the vote and neither one of the candidates has addressed the astounding collapse in value of the American dollar, which, this weekend, plunged to less than one 2,700th of an ounce of gold. It was only 53 years ago that, under the Bretton Woods agreement, dollars held by foreign governments were redeemable at a 35th of an ounce of gold. Since then the dollar has lost 99 percent of its value. 

Financial analysts say that it won’t take long before the value of the dollar tanks to less than a 3,000th of an ounce of gold. Bank of America, according to a note sent out last week, estimates the greenback will cross the milestone by the first half of 2025. “Indeed, with lingering concerns over US funding needs and their impact on the US Treasury market,” the bank reckons, “the yellow metal may become the ultimate perceived safe haven asset.” 

The shift is already in motion. Global appetite for American Treasuries — which once wore the crown as the “safe haven” investment — is waning. The share of dollars making up global reserves has dropped by 14 percentage points since 2002, when dollars accounted for 72 percent of global reserves. As of 2024, that number stands at 58 percent. America’s unfettered spending has no doubt soured some central bankers’ confidence in fiat dollars.

It doesn’t help that, according to the Committee for a Responsible Federal Budget, the national debt will, in only three years from now, reach a new high as a share of the economy. Meanwhile, “neither major candidate running in the 2024 presidential election has put forward a plan to address this rising debt burden,” the committee charges. Their plans “would likely further increase deficits and debt above levels projected under current law.” 

The issue was raised in the GOP primary debate in 2015 at Boulder, Colorado when Senator Cruz chastised the Fed for trying to “juice” the economy and called for a system “ideally tied to gold.” President Trump, a month later, mused that bringing back the gold standard would be “very hard to do, but boy would it be wonderful.” The GOP platform that cycle called for the creation of a Congressional commission to examine the return to a “metallic” standard.

Trump, though, failed to follow through during his tenure. Save for his nomination of July Shelton to be a Fed governor, Trump’s efforts to restore honest money have been disappointing. Now it appears that the Brics countries are beating us to it. Russia is expected to propose, during the upcoming Brics summit at Kazan, a new international payment system that it hopes would be immune to Western sanctions and rival the current system of fiat money. 

One option that the Brics Business Council is preparing to present, according to the Russian press, is a currency  pegged 40 percent to gold and 60 percent to a basket of Brics national currencies. The 10 countries belonging to Brics — including Russia, India, China, Brazil, Iran, and others — have already been shifting away from dollar-denominated investments and into gold, which they have been hoarding at rates faster than the rest of the world since 2018. 

By the second quarter of 2024, the gold reserves of Brics countries accounted for more than 20 percent of  the gold supply held by central banks. The growing hunger for gold, the Financial Times estimates, risks “eroding the international influence of the dollar and the US financial system.” Which brings us back to the presidential campaign. Vice President Harris appears to be offering a rehash of the Biden administration’s inflation-inducing policies.

Yet no Republican has taken up the monetary issue on the hustings, though the dollar shed more gold value on Trump’s watch than any president this century save George W. Bush.* Our own view is that Trump is the one candidate with the crust — and the economic fluency  — to take on this issue. The dollar’s collapse to less than a 2,700th of an ounce of gold suggests that there is no time like the present to turn to this issue.

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* Measured in terms of gold the value of the dollar fell by 68.9 percent on Mr. Bush’s watch, 28.9 percent on President Obama’s watch, 35.7 percent on Trump’s watch, and — so far — 30.9 percent on Mr. Biden’s watch.