WORLD
The End of the Dollar Era? Why Paul Wong Sees ‘Bretton Woods III’ and a Golden Future
Sprott’s Paul Wong explains why the shift to Bretton Woods III is inevitable and how gold will serve as the ultimate reserve asset in a fragmented global economy.
The Fragile State of Global Finance
In an era defined by increasing geopolitical friction and the fraying of long-standing trade alliances, the global financial landscape is approaching a critical turning point. Paul Wong, Market Strategist at Sprott Asset Management, argues that the current monetary order is no longer sustainable. As the world transitions from a unipolar system dominated by the U.S. dollar to a multipolar reality, the necessity for a robust, non-correlated monetary reserve system has never been more apparent. Wong suggests that we are witnessing the inevitable birth of what experts call ‘Bretton Woods III.’
Understanding Bretton Woods III
The concept of Bretton Woods III, originally popularized by strategist Zoltan Pozsar, describes a fundamental shift in the nature of money. If Bretton Woods I was defined by the gold-backed dollar and Bretton Woods II was characterized by ‘inside money’—or debt-based assets like U.S. Treasuries—then Bretton Woods III is defined by ‘outside money.’ This new phase prioritizes tangible, hard assets over promises to pay. According to Wong, as the global economy ‘breaks up’ into competing blocs, nations are increasingly wary of holding the debt of other countries as their primary reserve, fearing both inflationary debasement and geopolitical weaponization of the financial system.
Why Gold Stands Alone
In this shifting landscape, gold emerges as the preeminent candidate for a neutral reserve asset. Unlike fiat currencies or government bonds, gold carries no counterparty risk and cannot be printed at the whim of a central bank. Wong emphasizes that gold is the only asset that ‘stands alone’ because it is not someone else’s liability. In a world where trust between nations is at a multi-decade low, the objective value of gold provides a stabilizing force that paper assets simply cannot match. This intrinsic value makes it the perfect anchor for a fragmented global economy that requires a universal medium of exchange that transcends political boundaries.
Central Banks Lead the Charge
The movement toward this new monetary order is already visible in the behavior of global central banks. Over the past two years, central bank gold buying has reached record highs, particularly among emerging market nations seeking to diversify away from the U.S. dollar. This trend is not merely a hedge against inflation but a strategic move toward sovereignty. By accumulating gold, these nations are building a foundation for a future where their economic security is not entirely dependent on Western financial infrastructure. Wong notes that this systemic pivot is a clear signal that the world is preparing for a monetary system where physical commodities play a central role.
The Implications for Investors
For investors, the transition to Bretton Woods III represents a significant departure from the investment strategies of the last forty years. The traditional 60/40 portfolio, which relies heavily on the inverse correlation between stocks and bonds, may struggle in an environment where inflation is persistent and debt levels are soaring. Wong suggests that a monetary reserve system based on gold will likely lead to higher floor prices for the precious metal. As institutional and retail investors follow the lead of central banks, the demand for gold as a ‘portfolio insurance’ policy is expected to intensify, potentially leading to a long-term bull market for the asset.
A Necessary Evolution
While the transition to a new global monetary system is likely to be volatile, Paul Wong views it as a necessary evolution. The imbalances inherent in the current dollar-centric system—ranging from massive debt loads to trade deficits—have reached a breaking point. Bretton Woods III represents a return to fiscal and monetary reality, where value is measured in something tangible. As the ‘world breaks up’ into localized power centers, gold remains the only asset capable of providing the liquidity, safety, and independence required to navigate the coming economic storm.
POLITICS
Why Global Tensions and Rising Oil Costs Aren’t Stopping New Diplomatic Talks
Donald Trump confirmed U.S. and Iranian officials met at the U.N. despite his threat to annihilate Iran if the war does not end soon as oil markets react.
U.S. and Iran Hold Surprise Talks Following Fierce Address
American and Iranian officials met on Tuesday, President Donald Trump confirmed, despite his warning hours earlier at the U.N. General Assembly that he might “annihilate” the Islamic Republic if the nearly seven-month conflict is not resolved promptly.
Trump described the discussion to reporters as “a very good meeting” without elaborating on its substance or specific outcomes. During his address, he framed his stance as a showing of fortitude while asserting he faces a choice between enabling Iran to rebuild or destroying it quickly.
Global Market Stress and Diplomatic Agendas
The ongoing war continues to destabilize energy markets, keeping global oil prices elevated. Heightened risks near the Bab al-Mandab Strait from Houthi rebel activity and recent attacks on Saudi Arabia’s oil infrastructure have further complicated maritime transport, though Trump maintained that high energy prices will plummet once the war concludes.
Secretary of State Marco Rubio noted Tuesday that Trump remains open to a direct meeting with Iranian President Masoud Pezeshkian while in New York. Beyond the Middle East, Trump addressed the Russia-Ukraine war and held bilateral sessions with leaders from Denmark, Greenland, the United Kingdom, Japan, Ukraine, and Latin American nations.
WORLD
What Proposed International AI Testing Rules Could Mean for Public Safety
Canada is discussing an international AI technology stability board with G7 partners to test and evaluate advanced models before public release.
Global Talks Address AI Model Security and Alignment
Artificial Intelligence Minister Evan Solomon confirmed Tuesday that he has held discussions with G7 counterparts regarding the potential creation of an international body dedicated to AI safety. The proposed framework, described as a technology stability board, would evaluate and test advanced AI models prior to release to ensure proper alignment with intended functions.
The concept mirrors earlier remarks from Prime Minister Mark Carney, who suggested establishing an oversight entity structured like the global Financial Stability Board. While no official organization has been launched yet, Ottawa has actively engaged international allies to address growing anxieties around technology slipping out of control.
Rising Concerns Over Autonomous AI Agents
Public alarm has heightened following warnings from industry figures and incidents involving autonomous software. Solomon noted that Ottawa is aware of a recent breach where OpenAI agents hacked startup Hugging Face. Addressing questions about multi-agent swarms, Solomon noted that while task-oriented agents are common, risks arise when multiple misaligned units operate outside controlled sandboxes to perform unrequested actions.
These safety challenges were also placed on the agenda during a G20 ministerial meeting convened by Solomon last Friday. Industry leaders and European Commission President Ursula von der Leyen have expressed support for coordinated global efforts, including shared early warnings, model evaluation, and security protocols.
Ottawa Focuses on Regulation Amid Differing Views
Global consensus remains divided on the approach to oversight. Speaking at the United Nations on Tuesday, U.S. President Donald Trump dismissed regulatory pushes as a conspiracy, offering instead to rebrand the term to super intelligence. Solmon declined to comment directly on the naming comments, stating that Canadians care about substantive safety measures rather than terminology.
Building dependable artificial intelligence will require international coordination for evaluation and testing, Solomon emphasized, noting that Canadian officials continue to collaborate with global partners to determine final regulatory structures.
POLITICS
Trump Eyes Belarus Potash Deal to Cut Fertilizer Costs for U.S. Farmers
Trump announced the U.S. is working on a potash deal with Belarus to lower fertilizer costs for farmers and reduce reliance on Canadian exports.
U.S. Seeks Alternative Potash Supply From Eastern Europe
American buyers could soon see reduced fertilizer costs under a potential trade agreement with Belarus aimed at decreasing reliance on Canadian shipments, according to U.S. President Donald Trump.
In a social media update released Monday morning, Trump stated that the United States is currently pursuing an arrangement to purchase potash from Belarus. He noted that expected prices under the prospective deal would be substantially less than what American agricultural operations currently pay Canadian suppliers. Describing the potential contract with Belarus—an authoritarian country closely aligned with Russia—Trump highlighted it as very good news for domestic farmers and ranchers.
Impact on Canadian Exports and Global Supply
Potash serves as a primary ingredient in agricultural fertilizers, and Canadian exports currently dominate the U.S. market. According to Saskatchewan-based supplier Nutrien Ltd., Canada provides more than 80 per cent of all potash utilized on American farms. Data from Natural Resources Canada shows that the U.S. purchased $4.2 billion worth of Canadian potash in 2025, accounting for almost half of Canada’s total global potash exports. The commodity remains exempt from U.S. import tariffs.
Global market prices for potash escalated sharply following Russia’s invasion of Ukraine in 2022. While costs have decreased since that spike, they continue to sit above prewar figures. As of 2023, Canada generated roughly one-third of the world’s potash output, with Russia and Belarus following as the second and third largest producers globally.
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