The United States will be forced to print Treasuries to buy the commodities and industrial inputs desperately needed to re-industrialize and compete. This marks the beginning of the end for the U.S. dollar and Treasury bond's role as the world's primary reserve asset. For fifty years, the petrodollar system allowed the U.S. to export inflation and fund deficits by having the world store savings in U.S. government debt. That era is over.

The weaponization of the dollar through sanctions—particularly freezing Russia's foreign reserves—was a watershed moment. It demonstrated to the world that U.S. Treasuries are not a neutral, risk-free asset but a political tool that can be confiscated at will. This triggered accelerating de-dollarization led by BRICS nations. Central banks worldwide are dumping Treasury holdings and aggressively buying gold. In 2025, central banks are on track for another record year of gold purchases, with China, Russia, Turkey, and even traditional U.S. allies like South Korea increasing gold reserves.

A massive, state-led capital expenditure cycle in the United States aims to re-industrialize the economy. Driven by legislation like the CHIPS and Science Act and Inflation Reduction Act, plus renewed focus on national security under "America First," this initiative will unleash trillions in investment. However, this won't be clean, disinflationary growth of the past—it will be messy and inflationary, undertaken as "Re-industrialization at home."

Late 2025 research shows the staggering scale: between Biden and second Trump administrations, nearly $2 trillion in manufacturing investments have been announced. This includes over $600 billion from Apple, $150 billion from IBM, nearly $280 billion from major pharmaceutical companies, and over $435 billion for semiconductor manufacturing. The goal is reversing decades of offshoring and rebuilding domestic supply chains for critical goods like semiconductors, pharmaceuticals, batteries, and defense components.

The "Great Moderation"—the four-decade period of relatively stable growth, low inflation, and declining volatility beginning in the early 1980s—is dead. We are entering a new macroeconomic regime characterized by more frequent and violent swings in prices, interest rates, and input costs. Supply chain weaponization and policy intervention are the primary drivers of this new era of volatility. The world is moving from a predictable, efficiency-driven system to an unpredictable, security-driven one.

Supply shocks are becoming a regular feature of the market landscape. China's use of export licenses for rare earths and battery materials is a prime example. These are not random events but deliberate policy choices. The same is true of Western sanctions on Russian commodities. Each action sends a shockwave through the global supply chain, creating shortages and price spikes. As geopolitical tensions escalate, these policy "jolts" will become more common.