A structured retrospective of the 22-episode internal course for 2025, organized around the launch of the “dollar hot circulation” (the dual unlock of halting quantitative tightening plus rate cuts) as the year’s main thread, tracking the three-stage evolution of gold cognition, the contested role of stablecoins as a substitute for US Treasuries, and the contest over iron ore pricing power — and locating each within the framework.
The Framework As It Stands
This section is compiled from research drafts: the original framework’s structure, terminology, and key formulations are retained, including editorial bridges and external-fact annotations; diagrams are drawn by the compiler following the original framework’s structure.
The source document contains editorial bridges and external-fact annotations; this section is incorporated in full from the source document.
Annual Characterization
The analytical framework characterizes 2025 as the launch of hot circulation: the dollar system transitions from a half-loose, half-tight state — “rate cuts but still shrinking the balance sheet” — toward a genuinely accommodative posture in which “halting quantitative tightening and cutting rates proceed in parallel.” The framework defines the latter as the technical condition for the formal launch of dollar hot circulation. The 22 episodes of current-affairs commentary verify the progress of this transition through three threads: gold and silver, stablecoins, and pricing power over bulk commodities.
This year’s analysis forms a mechanistic cross-verification with The 2025 US Treasury Market: A Retrospective, Stablecoins and Tokenization, and other thematic analyses, recording the formation trajectory of judgments across 22 real-time data points.
Representative Signal Excerpts (Direct Quotations)
Signal One: The Three-Stage Gold Cognition Thesis (May 2025)
“At that time, globalization was in the height of summer. Everyone had only a very vague, distant sense of gold. Neither understanding it nor optimistic about it. The relic of barbarism — how could anyone be bullish on gold? So I remember that when I published Currency Wars in 2007, I put forward the idea of ‘storing wealth among the people in gold rather than in currency.’ This view was treated as heresy at the time. Economists believed that gold, crude and dirt-stained, deserved only to be a relic of barbarism — how could it possibly hold its head up in polite company, to be mentioned in the same breath as the dollar and the high-and-mighty foreign exchange reserves? As I saw it, at the time, 90% of domestic economists had been thoroughly brainwashed by the West’s doctrine of ‘gold is useless.’ That was the first stage — at the time, no one was bullish on gold and no one understood gold, so gold in China was simply not an investment asset. The second stage ran from around 2008 to 201—”
— Excerpted from 2025-05-24: US Treasuries’ 108-Year AAA Rating Has Been Broken — Gold Returns as King to Forge a New Stabilizing Pillar!
Signal Two: The Bessent Dilemma — The Framework Constraint of Short-Debt-for-Long-Debt Substitution (June 2025)
“Yellen’s approach had its logic — the Treasury Borrowing Advisory Committee’s recommendations were correct. What lies behind them? Behind them is the fact that the market told you: this is the only way. If you don’t follow through, or if you try to do something else, you will only be punished by the market. So in the end, Bessent’s choice was to follow the established path. He didn’t dare to break through the framework of substituting short-term debt for long-term debt. He didn’t dare to increase issuance to pay down debt, because the 30-year Treasury yield was already around 5%, the 10-year Treasury yield was already around 4.5%. The moment you ease slightly, back to normal conditions, these two things would breach 5% and head toward 5.5% respectively — then what?”
— Excerpted from 2025-06-07: Stablecoins: Savior of US Treasuries, or the New Battleground for a China-US Financial Showdown?
Signal Three: The Technical Definition of Dollar Hot Circulation and Iron Ore Pricing Power (October 2025)
“Right now, although you’re cutting rates, you’re still shrinking the balance sheet — that doesn’t count as genuine easing. You must halt the underlying balance-sheet reduction. Simultaneously, cutting rates — that is what dollar hot circulation means. Of course, doing this is, in my view, essentially the Fed making an official announcement that it has abandoned the problem of inflation and elevated employment to first priority — which is tantamount to surrendering to inflation, sounding the bugle charge toward inflation… Alright, our main topic today is about Australian iron ore and China — a kind of negotiation between them. How do we view this problem? I think, from our perspective, I feel that Chinese culture has always been relatively inward-looking.”
— Excerpted from 2025-10-11: The Pricing-Power Showdown: China Bans Procurement of Dollar-Denominated Australian Iron Ore!
Annual Reasoning Structure
flowchart TD A[2025 Current Events Context] --> B[22-Episode Annual Observation] B --> C[Thread A: Hot Circulation Launch Conditions] B --> D[Thread B: Gold/Silver + Stablecoins — Mechanistic Position] C --> E[Judgments and Forecasts] D --> E E --> F[Real-World Verification: Subsequent Events] F --> G[Methodological Distillation]
Technical Conditions for Hot Circulation (Distilled from Original Framework)
The framework explicitly distinguishes two monetary states:
| State | Conditions | Implications for Inflation |
|---|---|---|
| Half-loose, half-tight | Rate cuts but balance sheet still shrinking | Does not constitute genuine easing |
| Hot circulation launched | Halt to quantitative tightening + rate cuts in parallel | The Fed substantively surrenders to inflation; employment takes priority over price stability |
Compiler’s Perspective
Coordinates: Category = Event Retrospective / axis_h = Shu (Mechanisms & Decisions) / axis_v = Why It Is So
The core contribution of this 22-episode 2025 framework is to offer an operationally actionable hot circulation identification condition: not watching the interest rate, but watching whether the balance-sheet reduction has stopped. The two specific numbers in the Bessent Dilemma excerpt — 30-year Treasury yield at 5%, 10-year at 4.5% — serve as the precise anchor points through which the framework judges “long-end yields have locked out any willingness to actively lengthen duration.” With this anchor in place, the policy path described in The 2025 US Treasury Market: A Retrospective has a quantitative verification baseline.
Counterfactual test: An observer tracking only the rate-cut timetable would misjudge the following move: after the Fed began cutting rates in 2025, they would forecast across-the-board liquidity easing and position for long-duration debt assets. The framework’s judgment is categorically different: the combination of rate cuts plus ongoing balance-sheet reduction fails to satisfy hot circulation conditions; with the 10-year at 4.5% and the 30-year at 5%, long-duration bonds still carry substantial upside yield risk, and Bessent’s choice to “follow the established path” of short-debt substitution is precisely the empirical evidence of market pressure. The framework uses the three-stage gold narrative across 22 time points to calibrate this judgment: gold’s narrative reversal from “relic of barbarism” to “stabilizing pillar” coincides closely with the opening time window for hot circulation’s launch.
This Entry’s Exclusive Increment: The October 11, 2025 episode simultaneously addresses the technical definition of dollar hot circulation and China’s ban on purchasing dollar-denominated Australian iron ore. These two topics are not coincidentally juxtaposed in the framework: the de-dollarization of iron ore pricing power is the physical-goods-layer response to the “active contraction of dollar credit” that hot circulation’s launch represents. This mechanistic overlay (monetary policy pivot → shift in bulk commodity pricing power) is the unique signal chain that distinguishes the 22 episodes of this year from all other years; it does not appear in the single-mechanism entries Stablecoins and Tokenization or Gold Circulation: The Anti-Dollar Currency.
The Cost of Tech Centralization: Cloud Data Doesn’t Belong to You: Behind stablecoins being discussed as the “savior of US Treasuries” lies the fact that digital monetary instruments enable the US government to distribute debt obligations to the world in a new form — a structure identical to stablecoins being, in essence, cloud-based dollar debt claims, with holders having no recourse when the issuer defaults or regulators freeze accounts.
See Also
Sources
Compiled draft z-0199 · incorporated 2026-07
Source material: 22-episode internal course for 2025; representative episodes include 2025-05-24: US Treasuries’ 108-Year AAA Rating Has Been Broken — Gold Returns as King to Forge a New Stabilizing Pillar!, 2025-06-07: Stablecoins: Savior of US Treasuries, or the New Battleground for a China-US Financial Showdown?, and 2025-10-11: The Pricing-Power Showdown: China Bans Procurement of Dollar-Denominated Australian Iron Ore!