MW Why this hedge-fund veteran says investors should own both high-flying gold and the sinking U.S. dollar
By Barbara Kollmeyer
Ex-Bridgewater head of commodities Alexander Campbell says it's important to hedge
Is it time to load up on the U.S. dollar?
The year is starting to look like hell in a handbag for the dollar DXY.
President Donald Trump's apparent chillax over dollar weakness is being blamed for its latest lurch down to a four-year low. However, our call of the day from the former head of commodities at hedge-fund giant Bridgewater, Alexander Campbell, says the "current freakout is overblown" and investors should own the dollar and gold.
Campbell argues in a new Substack post that one of the best portfolio diversifiers is to own both, because a long gold position is actually a short dollar position. That's not just because gold is paid in U.S. dollars, but that speculative flows tend to move to gold when the dollar is weak, says the chief executive and founder of Black Snow Capital writes.
"So I hedge. The dollar position isn't a bet that the dollar is going to rip. It's acknowledgment that my metals book is already betting it won't," Campbell says.
"My gold and silver positions are implicitly short dollars. Every ounce I own was purchasing by selling dollars. If I didn't hedge some of that out, I'd be massively exposed to dollar weakness on top of whatever the metals themselves do," he says.
He also says the buzzy "debasement" trade - investors swapping fiat currencies like the dollar for assets like gold and bitcoin - is "more vibes than execution."
"It's not that people are fleeing from the dollar into precious metals. It's that they got psyopped by perpetual bull runs and low inflation (again globalization) into radically under-owning gold and silver," Campbell says.
Investors who own metals and nothing else should understand they're implicitly shorting the dollar, he said. "If you're genuinely bearish America, the trade isn't shorting DXY. It's selling the assets that foreigners actually own," naming the ETFs for the S&P 500, long-term Treasurys and mega-cap techs.
Campbell says foreigners are still not liquidating their trillions in U.S. stock and debt.
"If you want to know whether dollar doom is real, watch the flows. Are Europeans actually liquidating their SPX? Are Japanese pension funds selling Treasurys?" He says no.
Related: How both sides of the 'Sell America' debate can be right as dollar falls and stocks climb
Campbell lays out some scenarios that would get him worried about the dollar, none of which he's seeing so far. Those would include Japanese life insurers liquidating large amounts of Treasurys, the dollar's share of international payments dropping below 40% from current levels of 50%, or investors fleeing the Tether stablecoin, USDT, which is pegged to the dollar. Finally he is looking to see if there's a credible alternatives payments system that actually clears trade.
For those still "dooming on the dollar," he suggests a short position on U.S. stocks and U.S. bonds. "Because that's what will actually get sold if foreigners decide they have had enough of Trump. DXY futures market can only take you so far," he says.
Those who see a more managed decline for the buck should own metals, dollars and shorter-duration assets. He says that's a playbook out of the 2000 to 2010 period, another period of dollar weakness.
The markets
U.S. stock futures (ES00) (YM00) (NQ00) are pointing to a strong session for tech, gains for the S&P 500, but a struggle for the Dow industrials, as gold (GC00) and silver (SI00) continue to soar.
Key asset performance Last 5d 1m YTD 1y S&P 500 6978.6 2.67% 1.19% 1.94% 15.01% Nasdaq Composite 23,817.10 3.76% 1.70% 2.47% 20.69% 10-year Treasury 4.238 -0.70 6.60 6.60 -30.60 Gold 5274 10.59% 21.17% 21.74% 90.29% Oil 62.51 5.04% 7.87% 8.88% -15.49% Data: MarketWatch. Treasury yields change expressed in basis points
The buzz
Microsoft $(MSFT)$ (see preview), Meta $(META)$ and Tesla $(TSLA)$ (see preview) will report after the close.
The Fed policy decision will come at 2 p.m., followed by a news conference with Fed Chair Jerome Powell at 2:30 p.m.
Texas Instruments stock $(TXN)$ is rising after the chip maker projected first-quarter revenue of $4.32 billion to $4.68 billion, implying sequential growth not seen in 16 years.
Microchip equipment maker ASML $(ASML)$ reported much stronger orders than expected as memory chip maker SK Hynix says it will increase capital expenditure.
Amazon (AMZN) said it will cut 16,000 positions across the company.
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The chart
Bob Elliot, also a former Bridgewater Associates veteran and co-founder of Unlimited Funds, shares this chart that shows what investors over time have put into stocks versus gold. Elliot says in a thread that he "put more than 10% of his savings into gold in 2005."
Also read: This chart tracks the 'single greatest predictor' of stock-market returns - it's never done this before
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These were the top-searched tickers on MarketWatch as of 6 a.m.:
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-Barbara Kollmeyer
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January 28, 2026 07:01 ET (12:01 GMT)
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