[0:00]What's up, Graham? It's Guy here, and this is absolutely insane. We are in the middle of one of the largest financial shifts in decades, and almost no one's paying attention. For example, the US dollar is having its worst performance in over 50 years, oil prices are surging, raising the risk of stagflation. And now, for the first time ever in modern history, the United States is starting to lose its dominance on global trade to China. This isn't just a few bad headlines or a rough year in the market either. Major banks like JP Morgan are now warning that the entire global balance of power, trade, and money are starting to shift in a way that could completely reshape how you invest your money over the next decade. That's why we really have to talk about what's actually happening throughout the world order right now, why the US dollar is losing ground faster than most people realize. What this means for your money in 2026, and then finally, what you could do about this to profit. Because the people who understand this don't just protect their money, they actually position themselves in a way to benefit from it. Although before we start, as usual, if you appreciate videos like this, where I spend an embarrassing amount of time reading through research so that you don't have to, it would mean the world to me if you hit the like button and subscribed if you haven't done that already. Yes, I know this is the millionth time that I've asked, but it does help out tremendously, and as a thank you for doing that, here's a picture of a rock. So, thanks so much and also a big thank you to Sofi for sponsoring this video, but more on that later. All right, so before we go into what JP Morgan and Vanguard are predicting and what you could do about it, it's first important to understand why their numbers are changing. And it all has to do with something that most people are unaware of, and that would be the changing world order. Now, I know this phrase sounds dramatic and it's overused by every clickbait headline out there, but here's the reality. Every major shift in the global financial order throughout the last 100 years has produced some of the biggest investment opportunities and the biggest wealth destruction events of the entire generation. And right now, by all measurable metrics, we are in the middle of one. So, here's what's happened. As a bit of a background, after World War II, the United States pretty much won the global economy, and critically, the dollar became the world's reserve currency. Which is just a fancy way of saying that every other country needed dollars to settle international debts, buy oil, and conduct trade. This system gave the United States what economists call an exorbitant privilege, because we were able to run deficits, borrow money very cheaply, print a lot of money, and do all of that because other countries were buying our dollars. They were using it, they were investing in the United States, and so we could be a little reckless, which means uh, fast forward to 2026, where uh, things have changed. As of today, other nations like Brazil, South Africa, Russia, China, the UAE, and so on, known as BRICS, now represent about 45% of global GDP by purchasing power, while Western nations like the United States represent just 30%. Or I guess put more simply, the Western alliance that built the current world order now controls less the global economy than a coalition that didn't even exist 30 years ago. Why? Well, it all has to do with what's happening to the US dollar. Believe it or not, in 2016, the US dollar made up about 65% of global foreign exchange reserves, which is basically just a fancy way of saying the number of US dollars that central banks chose to hold on to. But by 2024, that number had fallen to 59%, and by 2025, it was down to roughly 57%. That's a decline of about 8% in just about a decade, and the rate of that decline is actually accelerating. All thanks to what's known as the de-dollarization playbook. See, up until recently, it made sense for other countries to buy and hold on to US dollars because it was seen as a safe store of value, it was globally accepted, and it had guaranteed purchasing power. But after the US froze Russia's foreign reserves following the Ukraine invasion, every country on Earth that wasn't an ally started to have the exact same thoughts. That could happen to us if we don't prepare. So, they started diversifying into gold, into each other's currencies. And this is the part that's moving quickly into an entirely new payment system that's designed to bypass the dollar altogether. As proof of this, in 2010, China held roughly 40% of their reserves in US Treasuries. Basically, they were lending the US government a massive chunk of their savings. But by 2025, that number had been cut in half to roughly 20%. They've also launched a program called CIPS, which stands for China's Cross-Border Interbank Payment System. This facilitates transactions in digital yuan, and even though it's not tanking the dollar overnight, it is taking away market share from the United States. In addition to that, other countries have also implemented their own systems to bypass the US dollar as well that most people have never heard of. With the first being number one, bilateral trade settlements. With this, instead of countries buying and trading in US dollars, they simply settle invoices in their own currency instead, as a way to get around the dollar. And we're primarily seeing this right now between countries like China, India, and Russia. Two, we have massive gold purchases. Since gold is treated like a neutral, non-dollar asset that's not subject to sanctions, central banks around the world have been stock piling. Presumably to buffer themselves from any currency risks, which leads to three, BRICS Pay. This is a joint payment platform that lets BRICS nations directly transact in their own currency without having to go through the dollar or Swift network. Which is the Western controlled messaging system that all international bank transfers currently run through. Then after that, four, we have something called mBridge. This is a blockchain-based framework that's currently being tested throughout central banks in China, Hong Kong, Thailand, the UAE, and Saudi Arabia. This allows countries to settle their own digital payments without needing confirmation from a neutral third party, like the United States. Which brings us to also number five, we have something called the Unit, which is a proposed digital settlement currency that's backed by 40% gold and 60% by a basket of BRICS currencies. Again, created to avoid settling transactions in the US dollar. Of course, a lot of these are not fully functional and realistically, they could be a long way off. But it is important to keep in mind that you don't have to replace the dollar entirely in order to weaken it, you just need to give a reason and incentivize other countries to use it less. And that's what's beginning to happen. So, in terms of what major banks like JP Morgan, Vanguard, and Fidelity expect to happen in the future, why Goldman Sachs believes that China could actually overtake the United States by 2035 and how you could best prepare going forward to come out ahead. Here's what you came for. Although, before we go into that, there is another topic that's worth paying attention to, because when the economy gets unpredictable, the people who do the best aren't the ones trying to time everything perfectly. They're the ones who are diversified. 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[7:37]They're the first nationally chartered bank where you could buy, sell, and hold cryptocurrency all from one app. They give you access to more than 25 different cryptocurrencies on a federally regulated platform, and they have all the safeguards of a bank. I personally like how everything is in one place, so instead of juggling between apps, I can manage my cryptocurrency right alongside with my checking, savings, and other investments. And if you're just getting started, they even have in-app guidance to help you learn as you go so that you're not guessing. Of course, crypto is incredibly risky, and you got to make sure it makes sense for your own situation. But if you want something simple and secure to get you started, we're giving you an all-in-one platform for practically everything. Just check out sofi.com/graham with the link also down below in the description. And from April 9th to June 30th, new crypto members could grab up to $1,000 to kickstart their crypto. Again, just go to sofi.com/graham to get started. Thank you so much, and now let's get back to the video. All right, so in terms of what's happening, why most people are completely unprepared, and what you could do about this to come out ahead, there is one more shift that could even have a bigger impact than China. And that would be global diversification. Like, here's the reality, even though Goldman Sachs projects that China overtakes the United States as the world's largest economy by 2035, the real story is the fact that India's population is about to hit 1 1/2 billion people. It's younger than China's, growing faster, and incredibly tech literate. That's why their forecast is that India becomes the world's third $10 trillion economy by 2036, and eventually, they'll get so massive that they'll rival both the United States and China. On top of that, once you zoom out even further, by 2050, emerging markets are expected to make up nearly half of the global stock market, up from just 27% today. With India alone potentially tripling its share. So, in terms of what this means for you, here's where things get interesting. As of right now, the average American investor has about 80% of their money in US markets, like the S&P 500, which made perfect sense for the last 50 plus years when the United States was the fastest growing, most profitable economy on Earth. However, over the last year, every single major institution has updated their 10-year return forecast to the markets. And for the United States, the general consensus was not so great. Like, when it comes to this, Vanguard is projecting US stocks to return just 3.9 to 5.9% annually over the next decade, while international markets are expected to do even better at 4.9 to 6.9%. And it doesn't stop there. JP Morgan is even more bullish on emerging markets, projecting around 7% annualized growth, with Fidelity estimating over 8% annually over the next 20 years. Or I guess put more simply, the general consensus here is that international markets are going to be outperforming the United States over the next few decades, purely because they have more room to grow and they're starting from a lower baseline. In addition to that, it's also believed that US valuations are already very stretched. The top 10 companies now make up about 40% of the entire S&P 500, which is a concentration risk that very few people talk about. And a weakening dollar on top of this means that foreign stocks, even if they earn the same amount in local currency, will actually return more to US investors once you convert those back into dollars. If that makes sense. Like, just think about it. The national debt continues to skyrocket, we're constantly printing more money to pay for things we can't afford. And over time, this is undoubtedly going to weaken the underlying currency that we all use and transact in. So, in terms of what you could do about this, here's my honest opinion when it comes to the dying dollar. As it stands today, even though the US dollar does appear to be in trouble long term, the good news for all of us is that, as of right now, there's no good alternative to take its place. For example, Europe has debt crises and political fragmentation. China has strict capital controls, limiting the amount of money you could move in and out, making it an uncomfortable reserve currency. Gold? Well, you just can't send that across borders in real time to settle debts. And even Bitcoin has proven to be too volatile to act as a reliable store of value in the short term. That's why the US dollar, with all of its problems, has something that no other country has, which is a massive, liquid, globally trusted market with a very well capitalized military. Like, when a crisis hits, money still flows into the United States instead of out from it, and the data backs this up. The dollar's currently used throughout 89% of all foreign exchange transactions.
[12:06]Swift data from February shows the dollar at 49% of all global payments. And even the BRICS alternative payment systems still largely route through the dollar infrastructure. In fact, China's own payments still rely on Swift messaging for a significant portion of their transactions. Not to mention, the United States is still the world leader when it comes to artificial intelligence, semiconductors, and biotech. This means that short-term, we're not seeing a dollar collapse, we're just seeing a dollar dilution where the United States is becoming a global superpower instead of being the only global superpower. And that transition is likely going to take decades to play out, not years, which is why the early money is starting to get ahead of it today. So, in terms of what comes next and how you could best invest moving forward, here's what you came for. First, don't go all in on the United States. I've been saying this now for years, but it's still very true. Just like you shouldn't put all of your eggs in one basket, neither should you put all of your money and resources into one country. Like, just ask yourself the question, are you willing to bet that the United States stays on top forever? And are you being paid enough for the risk that maybe they don't? For this reason, I just think it's worth it to invest a portion of your money throughout other countries, just in case. Which leads me to number two, emerging markets. Honestly, when JP Morgan, Schwab, Vanguard, and Fidelity all come to the exact same conclusion independently that international and emerging market stocks look more attractive than US stocks on a valuation basis, I just think that's worth paying attention to. A simple international index fund is really just all it takes, and even if they're all wrong, never hurts to have a little more diversification. Third, we have precious metals. I know, I've never been much of a buy gold person, but when central banks are buying it at the fastest pace in more than 50 years, and their argument for it is simply the government can't print more of it, I think it's worth taking into consideration as a small part of your portfolio. Again, as a hedge and a little more diversification, especially with debt cycle dynamics that we've all been talking about. From there, though, number four, it's also worth it to own some commodities. This includes items that the world needs to run on. I'm talking oil, metals, copper, food, you name it. The theory here is that as emerging markets grow and the dollar begins losing its grip, historically, commodity prices rise. So, this should provide a little insulation if we see supply shocks or higher inflation. Especially as Goldman Sachs keeps highlighting that commodities are one of the best insurance policies in a changing world order. And finally, fifth, don't abandon the US entirely. Even with lower returns expected, Vanguard still projects a 4 to 6% annualized return. The US still remains the world's largest economy. We have the best innovations and tech ecosystems, and we have the deepest capital markets. So, yes, being heavily invested in the United States still makes sense. It's just not worth it going all in and expecting the same returns that we've seen over the last 20 years. So, in terms of my honest thoughts on this, here's my take. No, I don't think this is a panic and sell everything moment, but I do think it's a signal that we might not see the same types of returns over the next 10 to 20 years, as a lot of people have become accustomed to. And small adjustments today could have a very big difference long-term. That's why this is all about staying flexible, paying attention, and being strategic about where you invest your money. Because a lot of the big institutions are already doing it. That's why to me, the opportunity here is pretty simple: the world is getting bigger and not smaller, and that means it's a good reason to invest in other markets that might be driving a lot of growth. The people who are able to benefit the most from that are not going to be the ones who time everything perfectly, but they are going to be the ones who recognize that this is happening, position themselves accordingly, and then just let time do the rest. This way, if the United States still carries on and dominates, great. Everything is as usual. But if they don't, then at least you have quite a lot to fall back on. And hey, you know what, in my opinion, if you play this correctly, it could be the biggest opportunity of the next decade. Just like hitting the like button and subscribing if you haven't done that already. So, with that said, thank you so much for watching, as always, if you want early access to videos like this, along with a bonus video every other week that I don't post publicly, feel free to join as a channel member. And if you leave a comment as a channel member, I get notifications on my phone, so I see every single one and I do my best to respond to each and every one of them. So, with that said, that sounds interesting, feel free to join, thank you so much, and until next time.
