Wong Warns: Fiscal Dominance Puts U.S. Dollar on Notice, Gold on Top
Gold prices eased slightly to $3,678.9 per ounce after the milestone, but the latest message from Sprott Asset Management and its market strategist, Paul Wong, is clear— gold is gunning for top billing in the financial system.
His latest report doesn’t mince words:
“Under this condition, the current dollar-centric global financial system will likely become less sustainable. Using the U.S. dollar as a store of value forces the U.S. to run persistent deficits, undermining its industrial base, a situation that is currently politically unviable.”
The context is as glittery as the metal itself. Gold has surged more than 30% year to date, fueled by a cocktail of Fed drama, tariff wars, and fiscal dominance. With political hands tugging at the central bank’s steering wheel, Wong argues the dollar’s credibility is wearing thin. And investors seem to agree—central banks worldwide have been stacking bullion like it’s going out of style.
Fiscal dominance, the polite way of saying “the government spends, the Fed obeys,” is now front and center. That means monetary policy increasingly serves Washington’s debt binge instead of keeping inflation in check. Negative real yields, a weakening dollar, and policy-driven inflation make for the kind of environment where gold doesn’t just shine—it blinds.
Wong isn’t the only one spotting the glitter trail. The steepening yield curve is flashing warning lights, and traders are hedging against a system where the U.S. dollar’s role as safe haven no longer looks bulletproof. Wong says in such a setup, gold steps in as the neutral, credible reserve asset. Thousands of years of history, trillions in liquidity, and the trust of central banks give it the resume the dollar increasingly lacks.
For now, bullion fans are basking in the glow of the latest $3,700 milestone. But the subtext is bigger: if fiscal dominance keeps bending the Fed’s will, the global financial system may wake up one morning and realize its vault of value is filled with gold bars, not greenbacks.
