According to Bloomberg Business, Clive Crook argues the US is entering an era of “radical uncertainty,” with every norm of trade, fiscal, and monetary policy tossed aside in the last 12 months amid an AI revolution that could dwarf previous economic transitions in speed. Concurrently, China’s Ministry of Finance has launched a National Startup Investment Guidance Fund backed by 100 billion yuan ($14.3 billion) from ultra-long special sovereign bonds, part of a billions-of-dollars push involving three regional funds to foster home-grown tech “little giants” and unicorns over a 20-year period. In Uruguay, central bank chief Guillermo Tolosa is implementing measures to reduce dollar reliance in one of Latin America’s most dollarized nations, as the dollar’s share of global central bank reserves has slipped from 71% to nearly 59% since 2000. Elsewhere, Bitcoin’s 30% slide from its peak is driving tax-loss harvesting, and Brazil’s central bank faces scrutiny over its liquidation of Banco Master following a December 2023 rule change.
The models are broken
Here’s the thing about Crook’s “radical uncertainty” thesis: it feels painfully obvious, yet most of our institutions are still pretending it’s not true. We’re trying to use economic models built on decades of relatively stable data to predict an era defined by simultaneous, seismic shocks. An AI productivity boom, a complete overhaul of trade policy, and wild fiscal swings? Pick one. Dealing with all three at once basically makes forecasting a fantasy. And that’s terrifying for anyone trying to make a five-year plan, whether it’s a Fortune 500 CEO or a family saving for college. The old measures of risk are, as Crook says, useless. So what do we do? Wing it? That seems to be the implicit strategy.
China’s very long tech bet
While the US grapples with uncertainty, China is making a staggeringly patient move. A 20-year venture fund? With a 10-year investment phase? That’s a direct shot at the short-termism of Western VC markets. They’re not just funding startups; they’re attempting to cultivate an entire ecosystem aligned with state priorities, like semiconductors. It’s a massive, state-directed experiment. But the mention of AI startup DeepSeek is the real kicker. It’s a quiet admission that private capital can be more effective at finding winners. So this fund looks like an attempt to marry state capital’s patience with the agility of private markets. Will it work? Who knows. But it shows they’re playing a completely different game, on a completely different timeline.
The dollar’s slow fade
Uruguay’s campaign against the dollar is a tiny story with massive implications. Look, no one’s saying the peso will replace the greenback tomorrow. But the central bank chief’s argument—that dollarization is bad for the local economy and people’s wallets—is part of a much bigger conversation. Trump’s trade wars and unpredictable policy turns are giving every other country in the world a strong incentive to de-risk from the US financial system. A drop from 71% to 59% in dollar reserves isn’t a crash, it’s a creep. But creeps can become avalanches if a credible alternative emerges. Uruguay’s move is a canary in the coal mine for dollar dominance. It’s not about one country; it’s about the mood.
Bitcoin finds a day job
In a weirdly practical twist, Bitcoin’s volatility is finally good for something ordinary: tax planning. The 30% drop creating a wave of tax-loss harvesting is the most mainstream, boring use case for crypto we’ve ever seen. It’s not “digital gold” or a “hedge against inflation.” It’s a tax asset. Financial advisers are treating it like any other underwater stock position. That’s almost a sign of maturity, in a perverse way. It means crypto is getting integrated into the very traditional financial systems it was supposed to overthrow. The asset might be digital, but the incentive is a classic, human one: keep more of your money away from the taxman.
