5% Treasuries Crush High-Dividend Stocks and High-Yield Money Funds | Still Chasing Yield After the Hike? Dollar and Gold Rise Together

5% Treasuries: the ruler for every asset on earth

This episode isn't about "one more place to earn interest". It's that once the US 10-year Treasury hits 5%, the ruler the world uses to measure assets has changed. US stock valuations get reset, Hong Kong stocks get drained dry, and mortgages and loans get pricier. Big V's reminder: for the past decade everyone treated Treasuries as risk-free, but the more expensive the yield, the more it's really telling you that funding costs and sustainability risks have gone up.

“That traditional textbook is already starting to burn.”「傳統嘅嗰本教科書，已經係講緊開始燒咗」Dollar and gold rising together: the inverse relationship is dead | 1:33 original clip

Dollar and gold rising together: two different buying logics

The old textbook says the dollar and gold move in opposite directions — not any more. The logic for buying dollars: you're buying policy, liquidity, 5% long bonds, and global money flowing back into dollar assets. The logic for buying gold: you're buying geopolitical instability, sovereign credit, and demand outside paper assets. When Russia–Ukraine kicked off and Russia's dollar assets were frozen, people realised holding Treasuries isn't necessarily safe — which is why central banks keep adding gold. Big V says he was saying in public, back at his day job before YouTube, that the dollar and gold would rise together.

High-dividend stocks: you earn the yield and lose on the price

If a company is genuinely strong, why would it need to pay you a fat dividend? A high payout often means the business has hit a bottleneck. After rate hikes, highly indebted companies that borrow to pay dividends see interest costs soar and free cash flow shrink, forcing layoffs and dividend cuts. Big V's example: an 8% dividend a year, but the share price down 38% — do you think you earned the yield, or are you sitting on a 38% paper loss? Resilience comes from real cash flow, not a high payout ratio.

The high-yield money fund and "cash-sweep" trap

These products dress up as "instant access, interest every day", but at the tail end of a hiking cycle they're at their most misleading: yields drift lower with short rates; some products sacrifice credit quality or stretch maturities to squeeze out a few extra basis points; and second- and third-tier currencies (think the Vietnamese dong, African currencies, the Philippine peso) are even bigger high-yield traps. Banks use high rates to pull in deposits, then lend that 5%-cost money out at 10% or 20%. A money fund is not the final destination for your investments.

US inflation: oil is the real culprit

In the Q&A, Big V broke down US inflation: it mainly comes from the Middle East war pushing up oil — gasoline, energy and airfares are all bundled together. Don't even think about high-dividend stocks at this stage; when picking companies look at net cash flow and total external debt, and for AI names also check year-on-year growth, customer mix and how long orders can last. Europe missed the AI windfall and has energy import problems; Canada's job market is narrow. Bottom line: the financial rules have changed, and Big V says he absolutely wouldn't buy Treasuries at this moment — because there's already credit risk.