Summary of The Dollar Milkshake Theory is Stronger Than Ever

00:00:00 - 00:15:00

The Dollar Milkshake Theory is based on the idea that volatility is higher than it has been in the past, and that this will lead to an increase in the value of US dollar-denominated assets. The theory was correct in early 2020, when the dollar spiked after a rally, but it was wrong in late 2020 when the Fed announced an intermediate rate cut. The author still believes in the theory, noting that there are inflationary and deflationary pressures in the world today.

• 00:00:00 The Dollar Milkshake Theory posits that volatility is dramatically higher than it has been in the past, and that this higher volatility will ultimately lead to an increase in the value of US dollar-denominated assets. Covid has been cited as having had a minimal effect on the thesis.
• 00:05:00 The Dollar Milkshake Theory is stronger than ever, and it is based on the assumption that equities and gold prices will rise and fall in a predictable way. In late 2020, the Dollar Milkshake Theory was wrong when the Fed announced an intermediate rate cut. This caused the Dollar to fall back to 94. However, in early March of 2020, the Dollar Milkshake Theory was correct when it predicted that the Dollar would rise to 102 after a seven or eight percent rally in two weeks.
• 00:10:00 The author of the video argues that the dollar Milkshake Theory is stronger than ever, largely due to the global response to the Catalysts event. He believes that if the Catalysts event was just a short-term trade, he would have exited the dollar at around 94 due to technical indicators. Instead, the dollar spiked to 92 and then 95, before reaching its current value of 102. He believes that this will continue until something fundamental changes with the system, which is why he still believes in the dollar Milkshake Theory.
• 00:15:00 The author points out that there are inflationary and deflationary pressures in the world today, but notes that it is difficult for governments and monetary authorities to respond to crises the same way they have in the past because all of the crises have taken place in deflation. He argues that eventually all of these things will happen, and that the US dollar will suffer as a result.