How the Stablecoin Milkshake Will Redollarize the World

Top 10 Takeaways

1. 01

   Dollar Milkshake Theory: massive global dollar-denominated debt ($10-13T eurodollar market) creates structural demand that overwhelms de-dollarization narratives. The dollar's H1 2025 dip mirrors 2008 and 2020 pre-crisis patterns that preceded sharp dollar strength.

2. 02

   This is a direct counter-thesis to Sharma. If Johnson is right, the ex-US outperformance trade breaks down because dollar strength erodes the currency tailwind that makes international equities attractive to US investors.

3. 03

   De-dollarization is popular but structurally unsupported. BRICS discussed alternatives for 15+ years without meaningful execution. Private markets continue choosing dollars for efficiency, speed, and cost. No alternative reserve currency has the depth of US Treasury markets.

4. 04

   A two-stack global monetary system is emerging: US (dollar-based) vs China (yuan + gold backing). Both China and Europe will need to print aggressively to manage their respective debt issues, reinforcing relative dollar strength.

   MCHI GLD
5. 05

   Gold rising simultaneously with the dollar confirms the crisis thesis. Foreign central banks buying gold (now holding more than US Treasuries for first time in 30 years) because they are avoiding sovereign bonds, not because the dollar is weakening.

   GLD
6. 06

   Johnson's positioning: favor US equities, gold, and dollar-denominated assets. Underweight international equities. Dry powder in two-year bonds at 3.5-4%. International equities offer only 1-2% extra return with significantly higher risk.

   ACWX GLD SHY SPY
7. 07

   The debt-based monetary system requires constant 3-4% growth to service interest, creating mathematical certainty of eventual crisis. Central banks have proven more competent at can-kicking than expected, potentially extending timeline 5-20 years.

8. 08

   The eurodollar system acts as a dollar vacuum. When credit contracts globally, foreign entities scramble to service dollar-denominated debt, bidding up the dollar regardless of US domestic policy or deficits.

9. 09

   The key risk to Johnson's thesis: if the Fed aggressively cuts rates and expands its balance sheet, it could overwhelm the structural dollar demand. Monetary policy is the swing factor between the Sharma and Johnson frameworks.

10. 10

    Practical implication: the portfolio should hedge both scenarios. Some ex-US exposure (Sharma thesis) plus dollar-denominated assets (Johnson thesis). The question is sizing, not direction. Both are credible macro frameworks that could play out simultaneously.