Merrill Lynch is urging investors to embrace a fundamental shift in their investing strategy as U.S. and Western economic domination crumbles.

The company is pressing its clients to revamp their investing strategy — even their basic beliefs about how to choose investments — in the face of world geopolitical change, according to The Financial Times.

In this new investing world, U.S. Treasurys and gold are out, or at least much less important. Investments now considered off-beat, like Australian sovereign debt and Singaporean bank bonds, are in.

Editor's Note: See the Disturbing Charts: 50% Unemployment, 90% Stock Market Crash, 100% Inflation

For the past half a century, the U.S. and a small number of other wealthy countries ran the world economic order. But that's over now. The Group of Seven richest countries, or G-7, expanded to the G-20 to include China and other emerging markets. But under the Merrill Lynch view, even that group is not inclusive enough, the Financial Times reports.

The world is now without clear economic leadership, the company believes. It's now in a "G-Zero world," Merrill Lynch executives warn.

The black-and-white distinction between developed and emerging markets is outdated. Some so-called emerging markets, like Indonesia and Ghana, will probably perform well, while others probably won't.

Plus, U.S. Treasurys should not be considered a special asset class or risk free.

"Unlike old U.S.-centric portfolios that called for nearly half of bond allocations being dedicated to U.S. Treasurys and municipals, [our] current models consider all bonds 'global,'” Merrill Lynch states, according to the Financial Times.

Merrill Lynch recommends lending to companies instead of governments, which are not as safe or transparent, and suggests ETFs as a protection against inflation and increasing taxes down the road.

"Geopolitical instability is the new status quo," states Merrill Lynch executive Lisa Shalett, in a company statement.

"As political powers shift and the global economy struggles to rebalance itself, investors might consider flexible investment approaches and a more globally diversified approach to their portfolio," says Shalett, who co-wrote a white paper, "Seeking Growth in a G-Zero World."

"In this G-zero world, the economy and the way markets interact have become undeniably more complex," says Eurasia Group President Ian Bremmer, the white paper co-author who coined the term, in the company statement.

Editor's Note: See the Disturbing Charts: 50% Unemployment, 90% Stock Market Crash, 100% Inflation