The mirror image of the Debasement trade: global debt is financed in dollars, the 2021–22 vintage of loans must roll at much higher rates, so the world is structurally short dollars and the dollar rises in a crisis (the “milkshake” school). FinanceLancelot’s 09/2026 version adds a policy twist — Bessent is “choosing to fight the WW3 currency battle now” by threatening to cut institutions and nations off from dollar supply; starved nations liquidate reserves including Treasuries “significantly below face value,” and “this will allow the U.S. to buy its own debt for pennies on the dollar and take it out of circulation.”
The last step breaks the argument. Foreigners dumping Treasuries below face is the bond-market crisis every other note here worries about — yields spike, and the Treasury that “buys for pennies” is the same Treasury refinancing $10T a year at those yields (r minus g — debt dynamics, The inflation surprise only works once). A state cannot profit from a fire sale of its own liabilities while it is the largest issuer of new ones. What survives is the shortage half: a dollar-debt rollover wave does bid the dollar, which is why the FIMA repo — borrowing against Treasuries instead of selling them exists — to hand foreign central banks dollars against Treasuries so they don’t sell them. The thesis and the plumbing agree on the pressure and disagree on who wins; the plumbing was built to make sure the answer is “nobody sells.”