Welcome to The Golden Reset

“The future is ours, and our golden age has just begun.” —Donald Trump, Inaugural Address, January 20, 2025

The term “Golden Age” comes from Greek mythology, particularly Works and Days, a didactic poem written by Hesiod around 700 BC. It’s part of Hesiod’s “Five Ages of Man,” which describes the evolution of humanity in five descending stages. The “Golden Age” is the first, followed by the Silver Age, Bronze Age, Age of Heroes, and lastly, the Iron Age. Each Age represents a decline in morality, culture, and quality of life among the races. It follows the law of entropy, the creation-to-destruction cycle we see in nature.

The Golden Race of humanity lived in peace. They were pure in heart and deed. They had a good relationship with Earth, which provided for all their needs. They respected each other and their gods, lived long lives without signs of aging, and died peacefully in their sleep. But this isn’t what most people thought of when Trump said the word “golden.” If you are a “Gold Member” of America, “golden” means you’re privileged with easy money, better cars and homes, real estate, stuff, luxurious travel, and loads of leisure and pleasure. Something for nothing on steroids.

The next thing we know, Trump is auditing the government’s financial transactions, and banks are flying physical gold worth billions of dollars from London to New York. COMEX inventories have surged 75%, while London’s gold vaults are being emptied. Treasury Secretary Scott Bessent announced that we will be “monetizing the asset side of the balance sheet” within the next 12 months. And there’s talk about auditing Fort Knox. Are they planning a golden reset? They’ve done it before, but this time gold would need to be priced well over $100,000 per ounce to fully back the U.S. debt.

If you want to understand what’s going on, get a cup of coffee like I did, and go through Foreign Relations of the United States, 1969–1976, Volume XXXI, Foreign Economic Policy, 1973–1976. Juicy reading, no doubt, with top government secrets from the 1970s. This stuff would make great material for a geopolitical thriller. Not to mention, what happened during this period marked the beginning of a new regime. It’s the story of new politicians covering the negligence of the former, and so on and so forth, until it unwinds and the whole big mess goes splat.

What was the catalyst? There were huge deficits in the U.S. balance of payments, and other nations were redeeming U.S. dollars for U.S. gold, in accordance with the 1944 Bretton Woods Agreement at a fixed price of $35 per ounce. This drained U.S. gold reserves and forced an abrupt end of the Bretton Wood Agreement on August 15, 1971. No more gold for dollars. And by 1974, the price of gold had catapulted to $200 per ounce, an increase of 471.4% primarily due to central bank buying by South Africa, France, and Switzerland.

The maddening part is it was actually illegal for U.S citizens to own gold from 1933 to 1974. This is because President Franklin D. Roosevelt signed an executive order on April 5, 1933, that essentially criminalized the possession of gold, with imprisonment and big fines. I wrote about what Roosevelt did and why he did it in a previous post. It’s critical to understand this story, if you don’t know it. After many deliberations and heated disagreements with other national leaders, the U.S. decided to finally to lift the ban on January 1, 1975, and allow the American public to buy gold again.

I grew up in the 1970s and 80s, and I remember my dad getting gold fever. After he saw Raiders of the Lost Ark (1981), he got himself an Indiana Jones hat, a bullwhip, a metal detector, and gold-panning equipment. I didn’t understand the role of gold back then, or how it was responding to inflation, oil crises, and international conflict. It rose from $35 in 1971 to $850 by 1980! If you didn’t live through it, or you just weren’t paying attention, imagine what this must have felt like for gold holders. A bonanza!

This early period is referenced in the Foreign Economic Policy documents as “the collapse of the fixed exchange rate regime envisioned at the 1944 Bretton Woods conference.” But it wasn’t a regime…Bretton Woods was the agreement, the backbone of the entire global monetary system. It was up to the U.S. government to assure that it was honored, and our government officials failed to do this. They violated the 1944 agreement to maintain the dollar-gold ratio…they cheated and got caught in a trap when other nations called their bluff.

The moment that Nixon ended the Bretton Woods International Monetary System, things got a lot more complicated in global trade. There’s much more history here that I don’t have space to write about now, but I kid you not, the U.S. government has spent the last 54 years trying to cover their gross negligence, first by demonetizing gold in the global economic system. It’s been one botch after another, bribes on top of bribes. See the Minutes of Secretary of State Kissinger’s Principals and Regionals Staff Meeting, on page 234 of the Foreign Economic Policy document…

Secretary Kissinger: Why are we so eager to get gold out of the system?

Mr. Enders: We were eager to get it out of the system—get started—because it’s a typical balancing of either forward or back. If this proposal goes back, it will go back into the centerpiece system.

Secretary Kissinger: But why is it against our interests? I understand the argument that it’s against our interest that the Europeans take a unilateral decision contrary to our policy. Why is it against our interest to have gold in the system?

Mr. Enders: It’s against our interest to have gold in the system because for it to remain there it would result in it being evaluated periodically. Although we have still some substantial gold holdings—about 11 billion—a larger part of the official gold in the world is concentrated in Western Europe. This gives them the dominant position in world reserves and the dominant means of creating reserves. We’ve been trying to get away from that into a system in which we can control—

Secretary Kissinger: But that’s a balance of payments problem.

Mr. Enders: Yes, but it’s a question of who has the most leverage internationally. If they have the reserve-creating instrument, by having the largest amount of gold and the ability to change its price periodically, they have a position relative to ours of considerable power. For a long time we had a position relative to theirs of considerable power because we could change gold almost at will. This is no longer possible—no longer acceptable. Therefore, we have gone to special drawing rights, which is also equitable and could take account of some of the LDC interests and which spreads the power away from Europe. And it’s more rational in—

Secretary Kissinger: “More rational” being defined as being more in our interests or what?

Mr. Enders: More rational in the sense of more responsive to worldwide needs—but also more in our interest by letting—

Secretary Kissinger: Would it shock you? I’ve forgotten how SDR’s are generated. By agreement?

Mr. Enders: By agreement.

Secretary Kissinger: There’s no automatic way?

Mr. Enders: There’s no automatic way.

Mr. Lord: Maybe some of the Europeans—but the LDCs [lesser developed countries] are on our side and would not support them.

Mr. Enders: I don’t think anybody would support them.

Secretary Kissinger: But could they do it anyway?

Mr. Enders: Yes. But in order for them to do it anyway, they would have to be in violation of important articles of the IMF. So this would not be a total departure. (Laughter.) But there would be reluctance on the part of some Europeans to do this. We could also make it less interesting for them by beginning to sell our own gold in the market, and this would put pressure on them.

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The U.S. wanted a system in which it could control. Europe was a problem for the U.S. power matrix, because Europe now had more gold, and the U.S. did not like this at all. So the U.S. government sought to reconstruct the financial system without gold backing, to cover up its negligence and remain in power. Since the reserve-creating instrument was gold, they confused the public by selling gold and gold contracts into the market to manipulate its price lower. Manipulation became the name of the game…manipulation of their opposition and manipulation of the public. On page 175, we see the emergence of this strategy with a telegram that discusses conversations with Finance Minister Schmidt…

As far as the dollar was concerned, Schmidt emphasized, he would not particularly welcome US intervention in its support at the present time if all that meant was the use of DM’s obtained under a swap arrangement…This would merely add to the inflationary pressures, Schmidt continued, within the FRG at a time when, he believed, the government’s anti-inflation measures were just beginning to take hold. One thing the US could usefully do, however, was to sell some of its gold. If we were willing, for example, to dispose of some 300 million worth of gold, the FRG and perhaps some other European countries would be prepared to join in with additional gold sales. His experts believed that, in view of the narrowness of the gold market, such sales would significantly reduce the present inflated price of gold. The effect of any such reduction would be psychologically important in reducing pressures on the dollar, since the present price of gold (three times that of the official gold value of the dollar) signaled to the entire world the weakness of the dollar.

Some of the biggest opponents of the U.S. “fix” were France and South Africa, probably because they both had a lot of gold! Under the rules of the IMF, imposed by the United States, nations were not allowed to buy gold at the market price. They could only buy gold from each other using the fixed official price on the books, which was much much lower than the market. This made it extremely difficult for the Europeans to balance their payments in global trade. And they weren’t going to sell their precious gold for double-digit dollars, so they ended up just sitting on it, and waiting. See page 159-161…

President Pompidou: Take the Bank of France, it has gold and non-convertible dollars unusable to us unless we want to run a balance of trade deficit, or who would give an ounce of gold at the official price? One of these days this system is bound to break down…I feel very deeply and I assure you I am not being dogmatic…I feel very deeply that to expect dollar convertibility tomorrow or very soon is a pipe dream. And one way or the other we must give the gold here in the reserve banks a level or price similar to what prevails on the market. I also believe it is difficult to set a price unless we authorize the bank to buy or sell gold at a price convenient to them, because this would merge the two: the French market and the lack of a market…

…Were I an American, I would not say that things were altogether negative at present. After all, the U.S. dollar continues to play its role as in the past, it is a reserve currency, and if I buy Deutsche Marks as a result of intra-European currency agreements, then by the end of the week I am told to give them back and take dollars. But it is not in the interest of the U.S. to have this situation going on. Much more serious is that I foresee that the Soviet Union will ask to join the IMF. Everyone will agree in the name of détente and the Soviets will come with a currency of fixed parity based on gold and convertibility. Consider the consequences.

…As to SDR’s, they are based on what? What is their value other than a symbolic value? I cannot believe in your proposal of setting up theoretical roles for issuing SDR’s for certain parameters of limits. I frankly found no one yet who believes in it either. But all will be accomplices to connive in this, debtors and inflation, particularly to ask for the West’s issuing of SDR’s. Less developed countries, for instance, will not have much resistance. In order for me to speak about SDR’s I must know to what they are pegged. Is it gold? No one believes this. Who will give gold in return for SDR’s? Only the market will decide if SDR’s are to be treated as “play” currency or good currency. If SDR’s are looked upon as good currency, they will be as good as travelers checks and will be exchanged freely, but if they are judged to be fake they will not last long. SDR’s can play a valuable role if they are appreciated by the market, and if not the system won’t work. Or else we will have to act, meaning to give a counterpart to SDR’s, and if it is gold then we are back where we started. SDR becomes a fictional replacement. I am not opposed to the idea but I seek concrete proposals and reassurances. We also have economists such as Mendes-France who thought that money should be based upon raw materials, but no one else believes in that. A currency must meet two criteria: It must be convenient; it must be secure. It must be recognized as secure and accepted as convenient. We are ready to look into conditions needed to make SDR’s meet these criteria. We await your clarifications because this is after all a U.S. proposal, but we cannot say in advance without knowing of the role they will play.

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SDR stands for Special Drawing Rights. It’s a made-up international reserve asset, if you didn’t already figure that out reading the excerpts above. The U.S. was determined to continue manipulating, any way that it could. This included overthrowing governments of their opponents and bagging the public with yellow rocks they hoped would never enter their financial system again. In a Memorandum From Charles A. Cooper of the National Security Council Staff to Secretary of State Kissinger, they started strategizing…

The financing of this intervention could be accomplished through swap agreements (in which we borrow strong currencies such as marks, francs, or guilders and utilize them to buy dollars) or through gold sales in the free market. (My personal recommendation would be to sell US official gold on the free market up to a limit of, say, $1 billion, in addition to activating swaps.) Associating our intervention with Phase IV3 would give us a double-barreled gain: demonstrating that we are prepared to act decisively both to support the dollar directly and to combat US inflation which is the basic economic factor underlying the present weakness of the dollar.

In order to get the foreign policy benefit we want from such intervention, we should privately consult with and seek the cooperation of key European officials, particularly the French and the Germans. In these consultations, we should stress that by taking action to strengthen the dollar we hope to provide a positive setting for progress in international monetary reform and trade negotiations. If we are successful in arranging an internationally agreed intervention effort in support of the dollar, we will have moved in a practical and tangible way to demonstrate that there is real meaning in our words about the Year of Europe. No other area of mutual interest this summer furnishes the same opportunity.

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These many documents inform us of the self-inflicted duties our government had to assume in order to keep their rogue fiat financial system intact. They needed to fight inflation to stabilize the international monetary situation. They needed to defend exchange rates. They needed to coordinate with other nations to fight destabilizing short-term capital movements. And they needed to emphasize the importance of permitting gold to play a role in the settlement of payment imbalances, while keeping the dollar on a throne. Surprisingly, they have somehow managed to do all of this, and a whole lot more, through magic and manipulation.

But something is happening now; something is different. As a friend of mine said, “the boys are back in town” and it looks this fiat regime is crumbling. How so? First, Trump is taking away the income that the regime gets from skimming the nation. This removes the Cantillon Effect. It weans off the professional class, which will force them to create and build again. Trump is also weakening Britain, by taking away their LIBOR (London Interbank Offered Rate) and sending for all the gold in London’s vaults. He seems to know that “He who has the gold makes the rules.” As J.P. Morgan said, gold is money and everything else is credit. He’s also working with Putin to end the Ukraine war.

With China and Russia now full of gold, and Europe being neutered by its own naughty behavior and lack of energy and natural resources, we’ve got the guru of The Art of the Deal and a lot of untapped potential. Quite honestly, as I’m reading his book, I can see clearly how Trump is the perfect fit for this job. No other man or woman is tough enough, truly. I don’t think he really understood the Blob in his first term, and he was too busy fighting off their ambushes. But I’m pretty sure that after eight years of their antics, he has wised up, and will now make things right in the world, to the best of his ability. Welcome to The Golden Reset! This is where we unwind and start anew.

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