Forward Guidance · Wednesday, September 2, 2026
The traditional 60/40 portfolio, composed entirely of fiat-denominated assets, may no longer be sufficient for diversification, according to Matt Hougan. He argues that assets like gold and Bitcoin offer a hedge against debasement, which is the erosion of the dollar's value against hard assets. This evolution is driven by concerns over fiscal and debt outlooks in global markets.
“60/40 is of course, 100% allocated to fiat denominated assets and therefore doesn't have that hedge that something like a debasement asset can cover.”
“So from my perspective, that's what we're talking about. We're talking about sort of destroying the underlying value of the unit of account, uh, as measured against hard assets in the real world. And I think that that's happening at an accelerating rate.”
“As investors, we don't have to put up with that. Because the way they pull that wool over our, you know, our eyes as investors is by selling an never ending giant amount of government bonds, which as Matt mentions, are in the fiat currency, and there's nothing behind them.”