BTC Sessions - TradFi is DEAD WRONG About Bitcoin: The Ultimate Setup

Episode Date: January 6, 2026

Mentor Sessions Ep. 046: Bitcoin 2026 Bull Run, TradFi Myths & Fed Liquidity Secrets | Joe ConsortiWhat if TradFi's bearish take on Bitcoin 2026 is dead wrong, and critically low bank reserves are the hidden Fed spark igniting an epic Bitcoin bull run? In this explosive episode of BTC Sessions, macro wizard Joe Consorti dismantles TradFi myths, revealing why Bitcoin volatility is at record lows—historically a screaming buy signal for massive upside. He exposes how plunging bank reserves act as Bitcoin's ultimate liquidity smoke alarm, with Fed interventions like $40B treasury buys set to flood the system and propel Bitcoin higher amid rising unemployment and asset prices bubble risks. Joe warns of long-term holders flipping from sellers to accumulators, ending the pressure that's kept Bitcoin range-bound, and predicts an explosion by year's end as we're just at the start of a multi-year bull market. From precious metals rotations to AI shovels outperforming, he shares why Bitcoin crushes gold as superior hard money—plus, how Horizon lets homeowners convert equity to BTC for 25-70% CAGR gains. If you're stacking sats, this is your roadmap to navigate 2026's Bitcoin bull run, dodging TradFi traps and capitalizing on Fed liquidity waves. Don't miss these game-changing insights—watch now and level up your Bitcoin strategy!About Joe ConsortiWebsite: https://joinhorizon.comX: @JoeConsortiYouTube: https://www.youtube.com/ ⁨@joeconsorti⁩ Chapters:00:00:00 Teaser & Intro00:01:12 TradFi's 2026 Myths00:03:14 Cycle Break & Bull Signals00:05:59 Equities & Metals Outlook00:07:28 Bitcoin Downside Exhaustion00:09:52 Range & Low Volume Causes00:11:26 Volatility as Upside Precursor00:14:13 Reserves as 2026 Catalysts00:16:23 Reserves-Bitcoin Correlation00:17:54 Liquidity Smoke Alarm00:20:10 On-Chain Holders Flip00:23:48 Seller Exhaustion Bullish00:25:55 Reserves Mechanics & Decline00:30:15 Macro Risks & Worsening00:31:27 Economy, Unemployment Outlook00:37:35 COVID Distortions Legacy00:39:45 Asset Prices Bubbles00:41:35 Investments Beyond Real Estate00:42:57 Gold vs Bitcoin Debate00:45:18 AI Opportunities & Miners00:47:23 Policy Shifts & Central Banks00:50:59 US Real Estate & Mortgages00:53:51 Bitcoin Fixes for Youth00:55:25 Horizon Equity Tool00:56:16 Canada Real Estate Rant00:57:46 S-Curve Adoption Potential00:58:27 Gold Parabolic Parallels01:01:32 2026 Prediction01:03:17 ClosingPrevious Episode:Mentor Sessions Ep. 045: Bitcoin Privacy Erosion, Quantum Myths & AI Data Threats | Time Chain Calendar Creator TC: https://youtu.be/H1ncnMF-img⚡ POWERED by Abundant Mines: Fully managed Bitcoin mining. Learn more at abundantmines.com/sessions💡BOOK Private Sessions with Nathan, Gary, or Ben at Bitcoin Mentor: Master self-custody, hardware, multisig, Lightning, privacy, and more. 👉 Visit bitcoinmentor.io Follow Us on X:• BTC Sessions: @BTCsessions• Nathan: @theBTCmentor• Gary: @GaryLeeNYC#Bitcoin #Bitcoin2026 #TradFi #BitcoinVolatility #BankReserves #BitcoinBullRun #Fed #Liquidity #LongTermHolders #Unemployment #AssetPrices #BitcoinPodcast #BTC #BitcoinNews

This is the roaring 20s for asset owners and it's a great depression for everybody else. Tradfai, the expectation is basically that Bitcoin is not going to have a great year. They're wrong about Bitcoin again, heading into 2026. Investor behavior is telling you that we are not at the end of a bull market. We are at the start of the bull market. The main entity that was selling Bitcoin bank reserves have declined to a level that is so low that it threatens regular credit activity in the banking system that the Fed has been forced to step in. The last thing that the Fed wants to do is to have bank reserves move into this

scarce territory. There is a very, very tight correlation between the reserves that are held at bank and Bitcoin's price. Welcome, friends. That's Joe Consorty, top macro analyst and head of growth over at Horizon, who's been nailing Bitcoin's wild ride with razor-sharp insights into everything from changing liquidity to on-chain hobler behavior. In this episode, we discuss why Tradfai is dead wrong about Bitcoin's doom in 2026. They're going to be wrong in the same way that they were wrong about Bitcoin having a great year of last year. The hidden signal in Bitcoin's record low volatility, that's screaming, look out. Coin's 10-day rolling volatility actually hit its lowest level ever just a couple of days ago.

This type of muted volatility precedes extremely explosive moves. And how critically low bank reserves are about to ignite a monster bowl room. Reserve management purchases this $40 billion per month. This is a response that's coming in anticipation of the crisis. Plus, he shares his end-of-your-your-Bitcoin price prediction in the face of seller exhaustion. Best guess for the end of the year. December 31st next year. Good morning, Joe.

Thank you so much for joining us. really excited to dive in. I want to get a, you know, a good grasp of what we can expect in 2026. Because there's been a lot of unexpected events over the last year or so. I think we'll have a ton to unpack, but kind of to set the stage to kind of see where we're at right now at the beginning of January here is I'm curious because I don't spend a lot of time there. What is the Tradvi view of Bitcoin at the moment? How are they seeing, you know, it looks like at the end of the four year cycle. How are they seeing Bitcoin and are they right? Are they wrong? What's going on in the broader space? Yeah, absolutely. So, uh,

Well, thank you for having me, first and foremost, really excited to be maybe the first episode in the new year. That's awesome. If I'm not, there you go, first episode of the new year. So excited to kick it off. Look, I think the best way to do this is kind of recap 2025. The going expectation from basically everybody, Tradfai included, was that Bitcoin would do exceedingly well. I was on the show, and we all remember the headlines when J.P. Morgan was calling for $200,000 Bitcoin. Morgan Stanley was calling for $180,000 Bitcoin, all these other, you know, massive bullish calls from all these major American financial institutions. Didn't happen, right? October 10th hit, you know, Bitcoin hit $126,000 in change on October 6th,

then October 10th hit, and all of a sudden, you know, we're down below $100,000 swiftly, and now we're still working on recovering. We're at $90,000. So really, Bitcoin kind of fumbled in the fourth quarter, a lot of investor expectations. And unfortunately, that sentiment is still the exact same in Tradfai. Tradfi, the expectation is basically that Bitcoin is not going to have a great year. A lot of the Fed uncertainty, the fact that it outper, it underperformed equities so severely in 2026. Tradfai tends to believe that the metals trade is going to continue into the 2026. But in the same way that they were wrong about Bitcoin heading into the end of last year, I have a feeling they're wrong about Bitcoin again heading into 2026. Reason being is it's just

quite simple, right? Number one, the four-year cycle had a great deal of sellers, people who were just positioned to sell regardless of whether or not macro conditions lined up for a supportive Bitcoin environment or not. So for instance, I'll actually share my screenings. here, you could see here that Bitcoin has historically always had these three, and the empty candles are green candles, the red candles are down candles. You can see down year, the year following the having up, up, up, up, down year, up, down, up, down. So we finally broke this cycle of Bitcoin having these three years where it, you know, ended the year higher than it began the year. And then, of course, had a red year the following year. We only had two green years followed

by a red year. Now, this may seem like absolutely nothing. In a way, it kind of is, right? This was sort of inevitable for Bitcoin. Bitcoin is an asset that has only had a market price for about 16 years, actually a little bit less than the 16 years. And so ultimately, this pattern was going to break eventually. But it's still a major development from a psychological perspective for a lot of people who trade Bitcoin. A lot of limit sell orders were put in place with the anticipation that Bitcoin was going to top toward the end of this year, or this was going to be another great year for Bitcoin and then Bitcoin over down year in 2026. However, we, we're going to we had a down year in 2025.

So all of a sudden, the four-year cycle is no longer a tradable model anymore. So that's number one. And then also number two, you have to consider if equities did exceedingly well in 26, if the stage is set for them to continue doing well in 2025, if the stage is set for them to continue doing well next year, which it is. And metals had a fantastic 2025, particularly heading into Q4. Investor behavior is telling you that we are not at the end of a bull market. We are at the start of the bull market.

Now, the question becomes, will we see a Bitcoin S crash in equities before we see a resumption in the bull market for Bitcoin and everything else? We could, right? Over the last month or so, the month of December was kind of a laggard month for equities. They stalled a little bit. The S&P still ended higher. The NASDAQ still ended higher, but less than 1% for both of them respectively, I believe. So they're kind of losing steam at the end of the year while the metals trade picks up. And TradFly tends to believe that throughout 2026, you'll see a lot, basically what happen to Bitcoin in 2025, you'll just see a continuation of that. I tend to think that the first couple of months will probably be continued rocky road for Bitcoin, if you will. And then

heading into the latter half of the year, potentially heading into Q2, you're going to see a lot more brighter skies ahead for Bitcoin. As we just clear away all of this selling pressure, as we clear away all of these folks who are planning on selling at around the $100,000 mark, I digress there. That's a lot of information, but that's basically where my head is at now. Tradfine thinks Bitcoin isn't going to do well this year, going to be more of the same. I tend to think they're going to be wrong in the same way that they were wrong about Bitcoin having a great year last year. Very interesting. There's a lot there that I want to tease apart kind of first and foremost. With regards to a specific, we'll go like the Mag 7, like the top of the S&P 500, the tech companies, the AI, as well as precious metals.

In your view, are either them approaching kind of like, are they over their skis at all? Is anybody there approaching atop in terms of equities or precious metals? Well, it certainly seems like it. Hold on. I'm going to go ahead and take a look at the year in review. These is normalized in percentage terms since January 1st, from January 1st, 2025 to December 31st, 2025. You can see silver kind of seems like it's having a little bit of a topy, but also it seems a little topy. But you can also see back in October, we could have said the same thing, right? When silver crashed 25% after hitting $83. And when gold crashed like 20% after hitting six, or excuse me, the other way around.

Yeah, when gold crashed, oh, no, these are percentages, excuse me. And then when gold crashed. but golds resumed higher and made a new all-time high toward the end of the year and silver even more so. So it really remains to be seen, but I'll zoom in here and I kind of want to showcase equities a little bit. So you could see kind of what I was describing a moment ago. Equity is kind of stumbled into year-end. You could see throughout November and December, they actually wound up a little bit lower. The S&P 500 wound up marginally higher, but the more sensitive NASDAQ index, obviously much more sensitive to tech.

it ended up lower, right? So kind of catching a similar trade to what Bitcoin did, the reason I am more bullish on Bitcoin than these other assets, I do think that potentially equities are heading lower over the first couple of quarters this year. Bitcoin will probably continue chopping around. Reason being, we already had a 35% sell-off in BTC, right? I believe chances are, given the extremely low volatility that we've seen in this area, there's just such low enthusiasm. Nobody wants to bid Bitcoin extremely aggressively in this area, particularly as equities seem like they're turning over. So I do think that there is some hot air to be let out of equities over the months of January, February, maybe into March.

We'll see some kind of a reset, maybe a 10, 15% correction similar to what we saw in April of last year, before resuming hire, right? One major reason other than cyclicality being that the midterms are coming up next year, and really the only card that Trump has left, as far as getting Republicans elected, is asset prices. If asset prices do extremely well, then chances are, whoever the incumbent is, they have a better time in the midterms. This has been proven out historically.

So I think Trump is going to do everything in his power in order to reduce asset prices. You also have to consider Powell is exiting as chair of the Federal Reserve this year. So this will be his last year as Fed share. He'll be exiting in the first half of the year, and we will see a brand new Fed share. Who is going to be a dove? Right now, it's between Kevin Hassett and Kevin Williams, both of which are big doves, obviously one of which was a former Coinbase advisor. And so I think all that is to say, I kind of got off the rails there a little bit.

Bitcoin has already had such extreme downside that I wouldn't expect further continuation from here. And you're already kind of seeing Bitcoin waking up a little bit. We're now testing $90,000 again. But if there's anything that we know about Bitcoin, never trust any of these little pumps back above $90,000. Every single one of them has failed. So I think Bitcoin has already had a lot of air let out of it. Equities have not, right?

And Bitcoin being so sensitive, it tends to lead the move in equity. you can see here, Bitcoin topped well in advance of the NASDAQ and S&P 500 topping. Bitcoin topped early October. Both of these equity indices topped late October. Obviously, the S&P 500 has gone on to make new highs. But basically what you've seen is a 35% drawdown in Bitcoin and barely two or three percent drawdown. I think four percent drawdown in the NASDAQ and no drawdown in the S&P. So I think we still have some time for air to be let out of equities. And during that period, I would imagine Bitcoin's volatility remains extremely low. We continue chopping around in this range. And we just have a boring month of January for BTC.

Fade literally every single breakout that you see until there's a resumption in a move higher in equities. What would be, I kind of want to get into like what might be the catalyst to actually kick things off a little bit later. Maybe like Q2 or Q3 of next year. But just even first and foremost, and I could be, you know, like I'm not looking at this data nearly as often as you. And so it could be just like a bit of a recency bias. But it feels to me like Bitcoin has been just stuck in this channel. I want to say like 80K to 90K.K. And every time it's touching one of that upper or lower bounds, it's just getting smacked down or bid back up there.

Is there anything going on behind, like, is there any reason to suspect that this is intentional? Or is this just, it's just, it's another pattern that we're observing no real indication as to why? It's just unbelievably low volume. I think that when Bitcoin underperforms, particularly as acutely as it did throughout 2025 into the end of the year, especially in the month of December, people will immediately accuse Bitcoin of being manipulated. However, there is not a great deal of evidence to suggest that that's the case, particularly when you consider how institutionalized Bitcoin is now. You know, if the United States government is holding a great deal of Bitcoin, if BlackRock is holding hundreds of thousands of Bitcoin on behalf of their clients, it doesn't behoove them to pin the price down in any way, shape, or form. And there's really been no evidence of that. Bitcoin is, you know, it's more highly regulated than it ever has been. so there's really no evidence of manipulation.

The reason Bitcoin is stuck in this range is just a tremendous lack of interest, just apathy, right? A lot of people have compared, in this chart that's up on screen right now is Bitcoin's 10-day volatility. I'll actually make this a little bit bigger here. You could see that Bitcoin's 10-day rolling volatility actually hit its lowest level ever just a couple of days ago on December 28th of 5.71, a value of 5.71 on its 10-day rolling volatility.

You could see that basically for two weeks straight from December 15th, all the way through the end of the year, Bitcoin traded within a range of two and a half percent, which is the narrowest range that Bitcoin has ever traded in over the course of its entire history with the market price. So the reason Bitcoin is dead is because Bitcoin is dead, right? That's why we've kind of been pinned down. There was a couple of attempts in order to push it a little bit higher at the end of November, early December, as you can see here. When those failed, I think traders just stepped away. They moved into brighter pastures. They moved into things that clearly didn't have as much limit selling pressure as Bitcoin, like precious metals, right?

A lot of rotation into precious metals is what you saw toward the end of the last year. But, you know, I wouldn't say manipulation necessarily. But another thing to make note of because Bitcoin's volatility has been so low is taking a look through history and seeing the other times that Bitcoin's volatility has been this low. You can note that the last time Bitcoin's volatility was in this, right? And this is 10-day volatility. You could pick any time frame, but the reality is that Bitcoin is going to be through a period right now that is not too dissimilar from other, from like bare market

bottoms, for instance. You could see here and I'll actually make this a little bit more helpful. I will pull out a horizontal line or a vertical line rather so we can actually go through and take a look at this. Back he, the last time Bitcoin's volatility was as low or as close to as low as it is right now was July of 2023, of course six months after that, Bitcoin was much higher, right? You can see with this white line up here. to that, beginning of 2023, you could see that months after that Bitcoin was much higher.

You know, it's $16,000 to $29,000, nearly doubling in the next four to five months. So ultimately, like, this type of muted volatility precedes extremely explosive moves, and those moves are generally only to one side, apart from what happened toward the end of 2019, which you could see, or the end of 2018 rather, every single time Bitcoin's volatility was this low, an explosive move to the upside rather than the downside is what followed in. So I would expect the exact same thing here. Potentially now that tax loss harvesting or what could be considered tax lost harvesting is one reason for Bitcoin being so low, now that the year is over,

that tax loss harvesting is no longer a factor that's keeping Bitcoin's price low. So we may actually outperform the month of January. We may end up much higher, a couple percent higher than we are now. But the reality is Bitcoin's volatility is extremely low, when it's been this low historically, it only moves in one direction, and that's not lower. So we'll see. It's just a function of when. That's super interesting, too.

And it's nice to go back and look at those points. I'm to think that it's almost like, I don't know, it's like taking a position. It's getting ready to spring back up and kind of move forward from here, which I agree. It's just even like completely emotionally based. I am incredibly bullish on 2026. Like it just feels to me like prior times where we were getting ready to take that next leg up. So I'm kind of curious twofold there. One, in your mind, what sort of thing?

we maybe expect would be a catalyst for the next to move up, if there would be anything in particular that would trigger it. And then we also spoke about going into midterms. And I know we have the new Fed chair coming in, either of the Kevin's kind of in, I think it's around May is when they rotate out. In terms of what Trump administration might do to try and juice markets going into midterms, is there any obvious low-hanging fruit that like they're probably going to roll this out? They're probably going to do this. Yeah, well, I mean, number one being what's already underway with the reverse management or reserve management purchases. I always say when I'm talking about that reverse management purchases for some

reason. I don't know if we had talked about this the last time that I was in the show, but it's effectively the Fed's latest acronym facility. We saw the BTFP back in 2023, which was this facility where banks could take distressed U.S. Treasuries, pledge them at the Fed, get par value. So essentially, if you had a treasury that was worth 70 cents in the dollar, you can get a full dollar for it. And then you needed to repay it over time. But it was extremely sweet, hard terms. That imbued the market with a lot of bank reserves that drove risk out. assets higher, what we're seeing with reserve management purchases, this $40 billion per month cadence of purchasing treasuries, make no mistake, it is printing money. Now, it may not have

as big of an impact on risk assets as prior times, like with BTFP, where the Fed basically extended a blank check. It was a crisis management solution. And back when the Fed did QE, and even back in late 2019, when they began the QE light prior to the massive QE when COVID hit, those were all crisis response mechanisms. This is a response that's coming in anticipation of a crisis to try to stave off a crisis. So it may not have as much direct impact on risk-taking behavior, but one chart that I did want to show, and this comes from Infra on X and Infronomics on YouTube for those watching. Fantastic channel. Go check them out. Robert, he's brilliant. This is a chart showing bank reserves in white. So basically, when the Fed purchases these U.S. Treasuries and

these bills and notes from banks, giving them fresh bank reserves and bank reserves will be on the rise. So up here in this top pane, this is bank reserves in white, and this is Bitcoin in blue. Now what Robert made note of is that if you take the five-month rate of chain between bank reserves in white and Bitcoin in blue, you could note, and unfortunately in the Bloomberg terminal, you can't overlay these two rates of change with one another. But you can see that every time bank reserves are on the rise, Bitcoin is also on the rise when they, basically, whenever they ebb and flow, so too does Bitcoin.

There is a very, very tight correlation between the reserves that are held at banks, which are directly impacted by the Fed's open market operations, such as purchasing treasuries directly from banks and Bitcoin's price. And you can see here again, that as bank reserves have declined to a level that is so low that it threatens the regular credit activity in the banking system that the Fed has been forced to step in. to now. Bitcoin's price is obviously plummeted. So too has bank reserves over the last couple of months. Now that bank reserves are on the rise, as a result of these reserve management purchases,

this $40 billion per month cadence of U.S. Treasury purchases, Bitcoin has found its floor. I don't think that's necessarily a coincidence. Luke Roman, even though he's bearish on Bitcoin for the time being, he has said in the past, and it's something that I largely agree with, which is that Bitcoin is kind of the world's last functioning smoke alarm for liquidity. And so when liquidity conditions are bad, particularly when bank reserve balances are declining, Bitcoin is one of the first to sniff it out. That's one of the reasons that you saw other than the blow up on October 10th. That's one of the reasons that you saw Bitcoin begin declining in earnest almost a month before equities did, because it saw what was happening in bank reserves. It had a much more acute response.

And so if we are to assume that global liquidity is headed back up because of this reserve management purchase program. It's not a really huge cadence, but it's going to impact Bitcoin at the margin. And also, it leaves the door open for the speed and cadence of the reserve management purchases to increase in the future, which would have a more direct impact on Bitcoin. So to answer your question, the first step that Trump, the Fed can already take to juice markets is already underway. The other two levers they can pull is obviously the new Fed share. And then once the new Fed shares in there, doing everything in his power to cut rates to the behest of Trump and pump asset prices hire. One company I like pointing people to when they ask about Bitcoin mining is abundant mines.

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Stuck on your Bitcoin setup? Unlock expert guidance from top education. Schedule a free chat at Bitcoin Mentor.io and get started, hassle-free today. All right, let's jump back into the episode. Yes, I have a lot of questions that I actually want to pull apart there. But Gary, let me let you jump in here and see what's top of mind you before I try to get into the weeds on bank reserves. Yeah, thanks, man. Thanks again, by the way, Joe, for coming on. This is great.

First guy of the new year and it's a great topic to talk about. For me, like, this is, okay, fun. It's entertaining. Whatever. I'm in Bitcoin long term, five years, 10 years. whatever it's going to do, what it's going to do. I do wonder, we see these numbers go up and down. And like you mentioned, you saw some correlation with Bitcoin going up and down, following periods of low volatility. So almost always it goes up following that you mentioned. I guess I wonder, you know, we can look at these numbers on the surface all day of price going up, price going down.

And so many people can come to obviously so many different conclusions. When you look at this stuff from a traditional finance perspective, are there, What are kind of the underlying fundamentals you're looking at with Bitcoin? Like, you know, just for somebody like me who doesn't do a lot of charts, but look at my baseball jersey on, I'm thinking, you can look at a player's batting average, but what's going on underneath the surface? Like, what's his on base percentage? What's his hits, his expected hits with balls in play? Like, what should we be looking at aside from just surface price?

Yeah, absolutely. A couple of other major things that people should be looking at is one of the neat things about Bitcoin is that because anybody can run a node, anybody can observe data and behavior of what types of addresses are holding Bitcoin, how long they've held them, there's a lot of data that can be extrapolated from the Bitcoin blockchain in and of itself. And so the other data that I'd say people should be looking at is on-chain data. Now, I don't have any of those, any charts that are readily available. However, a couple of things of note in order to take a look at why Bitcoin's volatility has been so low, is observe the dynamics of the key cohort that has

been selling, which has been long-term holders. And the reality is that, and this comes from Frank A. Federer on X, another great account, X Goldman Sachs, he posts a lot of on-chain data. What he has found is that the long-term holders, who have been the biggest distributors, the folks who've been holding Bitcoin for anywhere from 155 days ago to 10, 15 years ago, they've been the primary seller for the summer, and they are one of the big reasons that Bitcoin was kind of locked within that 100 to 120 range, they've actually not only ceased their selling, but they have begun accumulating at the margin at the very least. Effectively, what he's shown is the 30-day change between long-term holders, whether or not they are increasing in their, the amount of

long-term holders in the market are increasing, or the amount of long-term holders in the market are decreasing. And what he is for, found is that the amount of long-term holders in the market after the, basically the entire year since the first half of the year, then also July through the end of December, where long-term holders were decreasing. So basically, that's an indication that long-term holders are passing their coins off to short-term holders. They are selling their Bitcoin. They have now flipped positive. Again, so over the last 30 days, there's been a positive change in the amount of long-term holders, which means that either they are holding tight, but at the very least,

they are not selling anymore. So the exhaustion of the selling from long-term holders is the number one thing to understand why Bitcoin's volatility is the way that it is now. That's the key dynamic that's going on behind the scenes in order to understand Bitcoin currently. Another metric that he showed was long-term holder realized profits. So in other words, the amount of profit that long-term holders have generated upon selling coins. And what he also found was that long-term holders, as of two days

ago, sold just two and a half thousand Bitcoin, which is the lowest daily amount recorded throughout the entire year of 2025, which tells you that the main entity that was selling Bitcoin is no longer selling Bitcoin. They're holding tight. And so with sell pressure abated, it's only a matter of time before any positive catalyst whatsoever can send Bitcoin in the direction that we've all been hoping it's gone. All been hoping for it to go in, rather. So that's essentially what's happening under the hood, taking a look at behavior between long-term holders and short-term holders. The primary cohort that's been selling throughout all of 2025 is no longer selling.

They're sitting tight. And chances are that tells you anybody who is intending to sell has sold. And that's perhaps the most bullish development other than breaking the four-year cycle for Bitcoin as we head into 2026. Yeah. Thanks, man. Good stuff. You got it.

Great stuff. I absolutely love it. Okay. I want to bounce back. And Joe, I'm going to get a little bit like, let's say like, I'm going to say, monetary system nerdy and you may not have the answers for me but i'm trying to pull something out of my mind see if i can understand it so we've got the bank reserves have been on the decline and we're now seeing them step in to get bank reserves back up where i start to kind of lose my grip on how the

underlying monetary system is operating is number one how is it that bank reserves are destroyed like i understand through either defaulting on debt or for paying back alone how um broad money from the commercial banking system we can see that m2 kind of ebb and flow up and down that makes sense to me but i don't know the mechanism for why bank reserves would actually be declining. And then additionally, what always kind of, it's almost like I can't quite get my head around in terms of, all right, so they're using bank reserves in order to prop out of treasury purchases, basically, treasury values. It's almost like an anti-value destruction, keep the value of the treasuries up. From my understanding, the banks can loan to each other using those treasuries as collateral as well, too,

that the bank reserves might not necessarily be needed. So if the bank reserves, can borrow from one another without going to the Fed by using the treasuries that they're now using for bank reserves at the Fed, I almost feel like I'm missing a signal. Like there's something else that's going wrong in the system and I can't put my finger on it. Yeah. So basically the brass tax, the way that it works, bank reserves are the cash, the deposits, the other assets that are held by financial institutions. U.S. banks in order to satisfy customer needs, settle transactions between them,

and most importantly to extend credit. basically you can think of it as like this wave pool. And if there's not enough water sloshing around in this wave pool, then not enough people can come and swim in the wave pool. And then as a direct result of that, the water park loses money. That's just the first analogy that came to my head. I don't know why. But basically what you've seen here,

and I'll explain kind of the way that bank reserves get destroyed in a moment, is that over the last year, and I actually don't have the chart in front of me, but effectively there are different levels, you could call it, of bank reserves. effectively what has happened is bank reserves have moved from abundant which you could call this area right here and abundant would mean above a certain threshold of bank reserves as a percentage of GDP again i can't remember that threshold off the top of my head but they have moved from abundant to ample and ample is the final threshold before you get too scarce and the last thing that the fed wants to do is to have bank reserves move into this scarce territory so what do they do well the reason that

bank reserves decline are two ways. Number one, the loans that these banks receive from the central bank, they repay, right? And as a result of that, their bank reserves decline. And then the second one is that money gets transferred from commercial banks to the government. And so essentially, it's just a rejiggering of where the money is. It's moving from the bank reserves to the Treasury General account. So those are the two primary ways in which bank reserves get destroyed. And also people withdrawing physical currency from their bank, but that makes up much less of a factor here because most people don't actually use cash, right? So more often than not, the bank reserves that folks have on hand, that banks have on hand, that is primarily impacted in those two ways.

Number one, the repayments of central bank loans, and then obviously cash moving back to the bank. And then also the selling of bonds from the bank itself when a customer purchases a bond, that is one bond that comes off of the reserve balances from the bank and goes on to the consumer's balance sheet per se. So those are the two primary ways in which it happens. But the main reason the bank reserves have been on the decline is because the central bank has been allowing assets to mature. So functionally, whenever the Fed does QE, what they're doing is they're purchasing bonds from these banks. They're giving them reserves in exchange. And then they're putting those U.S. treasuries on their own balance sheet. So the Fed is taking

these US treasuries, they're putting them on their balance sheet. Once those treasury is mature, if the Fed doesn't re-up, right? If the Fed doesn't then go out and purchase more U.S. Treasuries from banks, then there is a decline in the corresponding bank reserve where they purchase the Treasury from. And so effectively, as central banks have allowed these assets to mature off their balance sheet and they haven't purchased more U.S. treasuries in order to re-up for all of the ones that matured, bank reserves are declining. So those are the primary mechanisms in which bank reserves are allowed to decline. However, with the Fed doing all of this quantitative tightening, I think they've embarked on it for the last three years, if not four years. Actually, a little bit

over three years, I think three and a half to four years. And then they briefly paused in March of 2023. They have done so much of it, as you can see here, that unfortunately we've moved from this regime of abundant bank reserves to scarce bank reserves, or ample bank reserves, rather. And so what they're doing now is they're not resuming QE, which is these large, wide-scale asset purchase programs, but they're doing purchases of U.S. Treasury's primarily on the front end. So bills and notes, rather than bonds, which would be anything from 10 years all the way out to 30 years, which has a much bigger impact on risk-taking and interest rates and mortgage rates, etc., which is much more stimulative to the economy. The reason they are doing this is to manage the

amount of bank reserves in the system, to make sure that reserves don't get so low that bank stop lending to one another and lending to consumers. So that's effectively how bank reserves get destroyed. Obviously, you know how they're created. And then what's happening right now, why the Fed is doing what it's doing? If, let's make sure I have this correct. So in a situation, let's just say the things, and I'll get your macro outlook as well, too, we may pivot to there.

But if the macro conditions were continued to get worse and there was perceived risk amongst the banks in the system, would I be correct in to then think that they would probably be wanting to stock up on treasuries, which would drive interest rates down, but also would them result in less bank reserves available because they're holding onto the treasuries, not wanting to necessarily sell them back for reserves at the Fed? Well, what happens is when the Fed decides to purchase treasuries from a bank,

the bank can't necessarily say no. What can happen, though, is the price at which the Fed purchases that U.S. Treasury can rise, and as a result of that price rising, the yields can decline, and that can put downward pressure on rates. So when the Fed does this, it actually applies downward, pressure on rates rather than other than anything else, right? Yeah. Yeah. Beautiful. All right. Well, taking that and kind of kicking off things a little bit too. So we know that we're seeing distress in the system, which is being flag by one, we have the little liquidity in terms of bank reserves.

We've also got what's going on with our precious metals. I believe the U.S. unemployment just hit a recent high as well, too, I think somewhere around like 4.6%. 4.6%. That's right. Beauty. What is your current, especially with going into midterms and I'm trying to get ready to choose the assets, what is your current viewpoint of the U.S. economy in terms of which directions it's heading? Are we still, I mean, I feel like I hear recession on the horizon all the time. I think that's always kind of the case. Like I had one guy telling me that you always sound smart if you have the Dumer perspective. It was like, that's kind of true.

I kind of get it. What is your outlook for the U.S. economy for 2026 in terms of productivity, GDP? Where do you think you're going flat, boring, up, down? What do you thoughts? Yeah, I mean, I think that with what the Fed is doing now, they're trying to counteract the rise in the unemployment rate. They're trying to make it so that jobs are more readily available. They're doing these purchase programs at banks in order to make it, make sure that enough businesses are getting loans to keep hiring up,

et cetera. I tend to think that it might not be enough, but we'll have to wait and see, right? Like, you know, it's the time-tested phrase, and you just alluded to it, Nathan, which is that, you know, it sounds, you sound really smart when you're a doomer, but ultimately, like, optimists make money because nine times out of 10, the economy is doing just fine. And then one times out of 10, when the economy isn't doing fine,

And guess what happens? This 2026, the Fed steps in with this monetary bazuka and they flood the system with a bunch of cash. And, you know, if the unemployment rate did spike if the labor market wasn't doing well, you know, two, three months later, we don't have a recession. Everything is fine. So, you know, I tend to think that, look, if I can go ahead and share my screen here of the, let's see here, this is the unemployment rate. This is the U3 unemployment rate, the most popular measure. Right now it's at 4.6%. if you look at the long run average of the unemployment rate, honestly, it isn't that bad. For the modern era, though, this is quite high. This is actually, if you take a look all the way back 18 years ago, or I suppose 19 years ago now, at 2007, the unemployment rate bottomed around 4.4%. So we have risen above the pregrade financial crisis bottom. But in the modern era, when the economy is in expansion mode, we're moving out of recession. Obviously, the unemployment rate is declining. Right now, we've been in a period of the unemployment rate rising for coming up on three years now. It'll be three years as of May for the unemployment rate rising.

This also lines up with some of the data I think we talked about last time of purchasing managers index. So surveys about economic health, whether the economy is expanding or staying the same or contracting, which have basically been flat for two to three years. So they've kind of been stalled out. The economy is in this really odd spot where businesses are saying, look, business isn't much better than it was last. month, but it's not much worse. But at the same time, workers are being fired. So the unemployment rate has risen from this trough of 3.4% to 4.6%. It's actually even worse when you look at the U6 unemployment rate. The U6 unemployment rate is a broader measure for unemployment. You can

see the subtitle here is actually, it's very old, so don't look at that subtitle. I think that was from like five years ago when I last used this chart. But you can see, and this includes part-time workers and margin employees. So it's a little bit of a broader measure for the unemployment rate. you could see that that has risen from 6.6% to 8.7%, the highest that we've seen since actually 2017. If you just take a look at U3, it's been doing okay for a while, but U6 has kind of been sounding the alarm much further in advance. And you can see that each time, and I actually overlaid recessions here, each time that the unemployment rate rose above a certain level, it was 7.4% here, it was 8.8% here. we're now nearing the point at which we crossed in 2007, rather, that was considered a recession. As far as the U-6 unemployment rate is concerned, and then the SAM rule, which has to do with

rolling averages or moving averages for the unemployment rate, we are now, I think, two basis points away from triggering this rule that historically, apart from one time, which was two years ago, I think, always predicts a recession or always foretells a forthcoming recession. So we're at a really interesting point. And, you know, taking a look at the unemployment rate, the assent at which it's rising from May to November, the last measure, we rose from 4.2% to 4.6%. So the economy is in kind of a dicey spot. And so to answer your question, like, what's my macro outlook? What do I think is going to happen. Look, right now the Fed is pricing in. If I take a look at the most recent numbers, I actually moved around all of my charts. Let's see here. So there are only two cuts that are

priced in fully through the end of this year. So it was three. Now it's two. Chances are that has something to do with the fact that asset prices are ripping through the stratosphere, obviously excluding Bitcoin. And the fact that apart from the labor market, kind of showing signs of weakness. Consensus is that we are approaching a point where the federal funds rate will be supportive of the economy. So that's why you're seeing a tapering off and rate cutting expectations. Honestly, it's something we'll have to wait and see for, right? The data blackout from October through early December did not help at all. Having that data probably would have helped inform the Fed's decision a lot more. And so Powell even admitted it. He said, you know, he's flying blind, right? And

He said that a couple of times before, but really he's trying to operate this big ship under a whole lot of fog that's happening. So I don't envy his position. If the Fed's current measures of purchasing $40 billion of treasuries from banks each month and bringing rates down in the way that they have is not enough, then we'll know pretty soon. We will know pretty soon. And then if history is any indication, they will swiftly increase the amount of using

activities they're doing. But for the time being, the unemployment rate isn't coming down. It isn't stalling out. So chances are, if history is any guide, they'll have to do more, whether that's an increased cadence of rate cuts or a much larger asset purchase program from banks in order to prevent the economy from unwinding even more from the labor market, to prevent the labor market from deteriorating even more, et cetera. Gary, I'll get you to jump in here just a second.

But I do want to kind of ask you, from your wonderful professional analyst and your charts and everything are just incredible. But if we're just two bitcoinsers, three bitcoinsers, hanging out having a chat here. One thing that always kind of, and it's just, it's almost purely speculation. I want to get your sense, your feel of it. It always kind of hangs over my head is, you know, even looking at those past charts, you can see that there's that big spike in unemployment around 2021 or so there. Like something may have happened and things went a little bit crazy.

Right. Weird. Yeah, I'm not sure what happened there. I can't remember. I'm wondering, like, I wonder if we've paid the cost of what we did over COVID still, or if that bill is still coming due. Like, I feel like there was. so much market disruption. We had supply chains get completely deteriorated. And we switch from this like just in time to more of like a just in case sort of model. In your Bitcoiner sense,

have we gotten far enough away from the economic distortions and damage that we did then that were coming towards normalization? Or is that bill maybe still coming due? I'll show one chart. And perhaps this will answer the question. This is the S&P K. K. Schiller, U.S. national home price index, the answer is no. We have not normalized from what we did in 2020 and 2021. The monetary bazooka that was let off has not been fully resolved here. The way that I'll just kind of demonstrate this is if we take the pace at which home prices were increasing on average across the United States, you look from 2012 all the way through 2020 over those eight years. It was about 4% a year, maybe 5% a year. This is where home prices should.

should be, right? Based on, you know, historical averages, they should be at an index value of about 275. Right now, they're at an index value of 328. They are so overinflated. It's not even funny. And for the first time in a long time, it's cheaper to rent than it is to take out a mortgage. That is as a result of mortgage rate still being at about six and a half percent nationwide, and home prices being where they are. Home prices effectively doubled, and they haven't done much in the way of declining. In fact, they seem to have just resumed this kind of steady upward cadence instead of having a crash back down to Earth. You'll recall back in 2008, when we had a very similar ascent in home prices, we had a devastating crash that followed over the next couple of years,

and it wasn't until five to six years later that home prices actually began rising again. This time, instead, and this kind of lines up with the way the Fed does things now, instead of asset prices coming back down to Earth, we're in a regime. where because it's more politically convenient to allow asset prices to rise forever, that's what we're doing. So unfortunately, we haven't really paid the Piper for everything that we did in 2020. And the path of least resistance for the political incumbent and also any political party in general is to just make sure that asset prices rise forever.

This will change in the future because younger millennials, Gen Z, Gen Alpha, et cetera, they don't have any assets, right? It's kind of, and I tweeted this out a couple of months ago, it's this. is the roaring 20s for asset owners and it's a great depression for everybody else. Ultimately, at some point, the dominant political cohort that politicians need to pander to won't be boomers anymore who are sitting on massive pensions and 401Ks and all of these assets. It'll be young people that have no assets. And so at some stage, we will shift, the political elite will shift from making sure asset prices rise forever to making sure that young people can get a slice of the American dream.

So I don't know if that answers the question or if that's the direction you wanted me to take in, but I do not think based on home prices, because obviously the mortgage is kind of bedrock of the economy, home prices are a great barometer for economic health. I don't believe that we have paid our dues for what we did in 2020 or 2021, because I don't see any crash. I don't see an asset price crash anywhere other than Bitcoin, but it's known to do that. I don't see a crash in home prices. I don't see a crash in equities. The most we've seen in equities is a 20% correction on the NASDAQ. It doesn't seem like it crashed to me. So I do not think we've paid our dues, as it were. I think that answers it beautifully. I do want to jump into real estate

But Gary, let me get, let me let you jump in here for a second and then I'll pivot us to real estate. Yeah. I mean, I think that's a great little graph to show with home prices. And, you know, the underlying issue is, you know, money printer go burr. This is something that we dealt with with the dot com bubble and then they printed a bunch. And then we got the housing bubble, which is much bigger than they printed a bunch. And now we're coming up on maybe the everything bubble, you know, as Larry Lepard will talk about with the big print. You know, you mentioned earlier that, you know, we're looking for Bitcoin prices to go up. You know, we're all Bitcoiners here.

I mean, in truth, I mean, I think I speak a little bit for Nathan. I think we would love to live in a world with Bitcoin prices don't go up because that would mean we actually live in a world of sound money. And I don't have to try to hide my wealth here in Bitcoin. But like Lynn Alden says, you know, nothing stops is trained. So I think we're kind of all in agreement with you that money printer go burr and maybe in the future 20, 30 years down the line politicians are willing to let asset prices fall, whatever that happens, I don't know, or maybe not for whatever reason.

I guess my question isn't so much will assets go up. I think that's going to happen inevitably, but over a one year period, two year, five year, 10 year, and pick any of those that you wish to address, is there a better, safer place to put your money other than Bitcoin? That's a really good question. I would say gold, right? Okay. Because, you know, and this is kind of the Lawrence Lepard school of thought, and I've seen it the last couple of episodes of Bitcoin boomers, which are fantastic, by the way. So well done to the whole team on those. You know, ultimately gold and Bitcoin serve the exact same function or a very similar function that is to store value in a world of perpetual monetary debasement. Lawrence Apart is a hard money bull. He's

not just a Bitcoin bull. And so I think this is something that the Peter shifts of the world miss, which is that the gold team, the Bitcoin team are fighting the exact same fight. It's just that one side of the aisle largely hates the other for whatever reason, right? If you think about it, they perform the exact same monetary functions. They have very similar monetary properties, but with a few key differences, right? Number one being that gold is relatively scarce, so there's a supply response function. This massive meteoric rise in gold that we've seen over the last year will be met with an increased amount of issuance from gold miners.

They will increase their CAPEX. They will find new sites. They will put new machines. They will hire new men. And as a result, that will increase the gold supply schedule that will dampen the gold price at the margin, but it's still relatively scarce, whereas Bitcoin is absolutely scarce. So if you talk about monetary hardness, you can define monetary hardness as the supply schedule, right? The lower the supply schedule relative to the existing stock of the money,

or in other words, the stock to flow, the heart of the asset is. And so gold basically is hard asset number two, Bitcoin is hard asset number one. And so if there were something that isn't Bitcoin that I would want to own over the next five, 10 years, it would be gold. And I think that that's something that's been validated over the last year. And I believe will continue to be validated over the next five, 10 years. I believe Bitcoin's still going to outperform, given it smaller size, it's increased relevance, particularly for younger people and superior monetary properties. But I think a runner-up will be gold. And of course, a few choice other monetary metals. It all boils down when you ask this question me, and I'm kind of strapped for an answer,

is thinking about monetary hardness and gold kind of takes the cake there. I know this is hard to predict and great answer. Can you imagine anything else, whether it's AI or something else, that would be a better investment over five years, something that's an actual technology aside from just holding your money in a scarce asset? Yeah. So, I mean, it's a quote that during gold rushes, what you want to buy as shovels.

You don't want to buy the gold. You don't want to buy the gold miners. And so, you know, Nvidia has proven to be an absolutely excellent. trade over the last three, four years. I would say that there may be a little bit of hot air that needs to be let out of that equity and other AI names over the next six months. So we may have a little mini bear market inequities, but I'd say over the next five, 10 years, if AI is going to play the role that we all believe it will, then you want to buy shovels, right? You don't necessarily want to buy the AI names because those will come and go. We don't necessarily

know who is going to take the top spot. Yahoo is bigger than Google for ages, and now nobody uses Yahoo for their search engine. So who knows? Someone may overtake Open AI. I have a feeling that it may be Grok. It may be anthropic. It may be someone else. But we're still too early in the game to tell who is going to be the number one player. So for the time being, as far as an investment in AI is concerned, I would want to buy the shovels. So any number, not the hyperscalers necessarily, so not the Googles of the world, not the Googles of the world, not the Googles of the world, what have you, but the chipmakers. Those would be the people that I would want to buy. And also of the Bitcoin miners, look, if we're moving into this world where AI compute is so dominant

and in such high demand, then it's kind of the Mike Alford playbook of, look, Bitcoin miners have a lot of compute that they may not always need and they can really easily flip a switch and make it to that instead of mining Bitcoin, they are providing data for these AI companies. So whether it's chips, whether it's Bitcoin miners, those would probably be the two main AI plays that I'd be bullish on over the next five, ten years if I wanted to capital. allows in the AI trade. Cool. Thanks, man. Yeah, you got it. Very cool. And I just want to advise, of course, for anybody. This is purely entertainment. That's right. Nothing we say should be taken seriously in any way whatsoever.

Of course. It's monetary advice. It's not financial advice. That's right. I do. It's funny. I just want to even point out, I don't know if you guys saw. There was that clip of, was it Madani, the mayor from New York. We're talking about like the shift in terms of demographics that right now they cater to boomers, but they're not necessarily always going to cater to and he had the comment or something on the lines of like instead of rugged individualism. We're going to have the warm collectivism. And all I kept thinking to myself is that we think they're like, oh, they might like let the air out of assets in terms of like making them cheaper for younger generations.

No, no, no. They might have a bailin. They might just straight strip those at some point in times. We may see an increased push towards socialism where it could be just a forksed one-times, uh, unrealized capital gains tax like we saw in Australia, that there may be some sort of a move in order to, to directly take from the older generation and give it to the younger one just based on, well, just based on the public and the popular sentiment of the day.

I did, Joe, I did want to unpack a little bit more in terms of real estate. So I'm seeing some weird things going on, and I want to kind of get your sense of what you can make of it. So not only you're looking at the fed, so we've got the two cuts priced in currently at the moment, we're looking at easing in the Fed, but if I look at other central banks around the world, I understand there's very, very different positions. I'm looking at, like, say, for example, the Bank of Canada has actually a rate hike priced in currently last I look for the end of the year. Additionally, where this starts to get confused from me is getting all these sort of mixed messages. So Bank of Canada no longer cutting, looking at

potential hike, at least being priced in for the end in the futures market. However, real estate for Canada right now sucked. It was down across the board. I think it was like the lowest sales volume since 2000, something along those lines, almost like a 25 year low in terms of sales volume in Canada. I think all major metropolitons are down like six, seven percent. I know that Calgary's down, Vancouver, Toronto. I think the only one that was up over the year was like Halifax. And I think we just had negative GDP as well too. And our unemployment is still not great. So I'm looking at a situation like Canada where I would think that more cuts, more easing would be in the cards, but that's not currently what's being priced in. And so I'm curious, your views on the various central banks,

maybe like even Japan was looking at hiking rates, but they're looking at stimulus as well too. So discrepancies between central banks and also particularly with your work at Horizon, I figure you might have an interesting take on the U.S. real estate market where it's currently sitting. Yeah, absolutely. So, I mean, I don't keep up with Canada too often, but as far as I can tell the relief. Yeah, exactly. No, exactly. It's not like they're four hours away. It's not like you're four hours away for me. Tenth the size, dude. I look at the U.S. more than Canada. Yeah. But if I were to guess, I would say, you know, number one, it's because economic activity has been stronger than expected. And number two, because high inflation.

right, or at least inflation that is still above target. I think you guys are at 2.3%, if I'm wrong, 2.4% year over year. And so my expectation is that you guys want to bring that down a little bit more, which is in the start contrast to in the United States. It seems like we're taking really diverging paths. We're well above 3% still and we're cutting rates. Not only are we cutting rates, but we're also doing asset purchases from banks with freshly printed U.S. dollars.

So it's wild. It seems to me that, you know, in Canada, for whatever reason, you guys want to tamp down even more. And it may be a measure to help young people. I mean, look, you said that the housing markets across, you know, most of Canada are not doing very well. Raising rates is a measure that will make it so that home prices go down even further in order to make, obviously, selling competitive. So that's a great thing. If you take a look at Canada's housing market relative to the United States, back in 2008, when we had the great financial crisis, home prices corrected in the U.S.,

but after like three or four months in Canada, they just kept going higher. And they basically never stopped. So that bubble that I just mentioned in home prices that we deflated all that when I say we, the United States, that we deflated all the way back in 2012, you guys still have. And so I'd say that raising rates is a measure to combat that. Or at the very least, it'll be a nice second order effect of raising rates there in Canada. Hopefully for young people, home prices will come down. And then as far as the United States is concerned, look like right now, let me check with

a 30-year mortgage rate is at, actually. But, you know, the Fed has cut rates now three times. This has been their third. cut of the year. Let's see here. 30 year mortgage. If I could spell mortgage correctly, that'd be good. 30 year fixed rate mortgage. Let's see, 6.25%. It's fantastic. And the reason I say it's fantastic is because we're coming off of a year that began with mortgage rates at 7.5%. And so now we're down to 6.25%. These are the lowest rates since 2022. So when we were on the way up, I don't think they'll fall much more. If you take a look at the long-term average of where

mortgage rates have been in the United States, you're talking about, you know, four to eight percent. If you go pregrade financial crisis all the way for the early 2000s, you were looking at anywhere between 5 percent and 6 and a half percent. And that's exactly where we are right now, 6.25 percent. So with two more cuts priced in, look, I would imagine that mortgage rates maybe make it down below the six handle and then stay there. That's where they're going to stay. But that's going to spur housing activity or home sales in the United States. Unfortunately, like I mentioned, it seems like we're taking the opposite tact from Canada. You guys are raising rates in the face of really high inflation,

whereas we should be raising rates to let the hot air out of home prices. Instead, we are protecting homeowners. Real estate is 55% to 60% of the typical Americans portfolio. And so what Trump is doing and the administration is choosing to do is instead of allowing home prices to come down by keeping rates elevated or at least pressuring Powell to keep rates elevated and building new homes, both of which would have an impact of decrease, increasing home prices markedly, bringing them back down to that long run average growth rate

that we showed earlier. What he's choosing to do is he said this in a press conference explicitly that he wants to protect home values for existing homeowners. So ultimately, as I said at the beginning or toward the middle of this call, the incumbent political class in the United States is very focused on protecting asset prices for asset owners rather than helping young people get into the market. The only thing that they have floated to help young people get into the housing market is a 50-year mortgage, which effectively will provide exit liquidity for boomers and not much else.

It'll make it so that young people can buy a home. The person who is selling their home to downsize can go and move to Cabo or wherever or going their forever cruise down in Florida. But the young person will have to go through 12 years of basically interest-only payments in order to start building their equity in that property. So it's a really raw deal for young people in order to actually make. make them homeowners. You need to build more homes, need to allow home prices to correct. But the decisions we're making currently in the U.S., neither of those things are happening.

And so it's a question, what does it mean for young people? How does Bitcoin fix this for young people? Well, number one, instead of buying a home, instead of putting that money toward a down payment, buy Bitcoin with the money that you otherwise intend to put down as a down payment on the home. Now, hear me out. The reason being with the, it's twofold. Number one, Bitcoin's compound annual growth rate over multi-year periods of the last five years has been 25% over the last 10 years has been 70%. So 70% on average over the next 10 years. If you're a young person like me, I'm 24 years old, if you save for the next 10 years in Bitcoin, your money is going to be much larger than any increase in home prices over that period. And you're going to be much

closer to your goal of having enough money for a really sizable down payment on a home or at the very least being able to have a big enough Bitcoin stack to borrow against it partly once Bitcoin mortgages become popular in the United States, which is the second thing I'm mentioning. We're on for that becoming popular. So for existing homeowners, purchase Bitcoin, rent cheaply live below your means and obviously upskills so you could increase your income. That's what I would say for younger homeowners because the government is not coming to save you. For existing homeowners, that's why we built Horizon. Horizon lets you purchase Bitcoin with your home equity. So I just mentioned earlier, you know, homes are doing four, maybe five percent a year. Over five years, Bitcoin has done 25

percent on average. Over the last 10, it's done 70 percent on average. So ultimately for new homeowners, we don't have a solution for you yet. Stack Bitcoin, eventually purchase a home if you'd like to, or don't buy a home at all, continue renting, just allow the Bitcoin to do the work. And then for existing homeowners, you can either obviously downsize and sell and buy Bitcoin, but if you're in your forever home,

if you're sitting on a lot of equity, if you're unhappy with this performance, Horizon helps you convert home equity to Bitcoin. And we've helped so many homeowners over the last several months to do that. So just quick plug there. But yeah, that's kind of my general take in the real estate marketing Canada here in the United States, two very different things.

It seems like we're taking the opposite approach. Yeah. Yeah. It's very crazy to me. I feel like it's going to come back and probably like Canada on the ass at some point in time. Like we really, I don't think we really can not follow the behemoth down south. But it's funny because it seems to me like like three percent inflation has really become the new target for the Fed, at least not necessarily explicitly, but implicitly, just kind of by the actions. Like, no, we're just, this is the new normal. This is where we're going to establish.

And also to your point about like how bad things are in Canada. in terms of real estate. We pulled that. We had another wonderful guest to Vancouver real estate expert a couple weeks ago. And I showed Gary for the first time, Joe, if you'd never check this out, there is Crack Shack or Mansion. The Canadian real estate has gotten so bad that there's a game where it will show you a house, the purpose of which is to guess whether or not it's a Vancouver multi-million dollar

mansion or a crack shack. And spoiler alert, I don't even hit 50% on that thing. Like the Canadian housing market has been so ungodly inflated. such a monetary premium. It is basically everyone's retirement plan, their entire savings. And we borrowed so cheap for so long that it's ridiculous. It's absolutely ridiculous. I'm also good to hear about you people coming in, getting equity from their homes

through horizon. Because on the consulting side for me and Gary as well, too, this past year has all been real estate for me. So in customers and clients that I'm working with, a lot of them were Ontario area real estate investors, some in BC as well too, that were liquidating all at times or portions of their real estate portfolio to move it into Bitcoin. Like I don't think the Canadian real estate market is done. I think it probably will see more volume next year,

but I don't think we've bottomed out. Rents are still coming down. And even with the CPI being at like, what is it, like 2.4 or whatever percent it was, oil and energy is down. Rents are down like across the board in Canada. I think the numbers need to catch up here. I think that the Canadian CPI is probably like coming up on 2% or sub 2%. But another round topic.

I do want to get to, your bulkcase, your outlook for 2026, because that's the red meat. That's absolutely we got to cover. But before that, Gary, anything from you, my friend. Yeah, and I guess this is kind of part and parcel of what Nathan was going to ask. You mentioned 70% Kager for the past 10 years and 25% in Bitcoin over the past five. I know, sorry, Michael Saylor has talked about eventually going from like 40% down to 35, down to 30, 25, eventually kind of stabilizing out at about 20% a year, maybe about 20 years from now.

this might be a little bit out of your ballpark, but do you envision any type of S-curve adoption for Bitcoin where there will be just a moment where suddenly we just kind of skyrocket up and then level off? And if so, when might that happen and what might be something that triggers it? Well, it's interesting that you should mention that because if I pull up the chart of gold, and this is an argument that I ascribe to for a while, is that, look, once Bitcoin gets to a certain point, you know, it's not going to grow at the rate that it had. It's going to have diminishing margin of returns. And I do believe that that's true for, you know, to a large extent. You can see here gold, basically for a decade, it rose. You know, if we take 2016 all the way through

2024, for example, it only rose 85%. And then all of a sudden, if we delete that, so, you know, 85% over eight years, right? And then all it takes is, you know, some type of monetary event for people to all of a sudden get really scared. And then it can replicate those 85% returns in 12 months, right? 18 months. So even, and silver is an even more insane example, right? I showed the chart earlier where silver is up, you know, 170% this year, something crazy like that. So ultimately, once Bitcoin, you know, these are huge assets and they have had triple digit returns, right? Obviously silver was smaller than Bitcoin. It's now larger than Bitcoin. But taking gold as a prime example, it is more than 10 times the size of Bitcoin.

Before it started this run, it was still more than 10 times the size of Bitcoin, and it managed to more than double over a period of less than two years. So ultimately, I do think that the path of least resistance for Bitcoin is diminishing marginal returns each year. But to your point about S-curved option, there could come a time, we're very similar to gold,

what we saw this here, where for whatever reason, it just resumes, you know, the Bitcoin of Your, right? Where we see these, you know, triple digit, quadruple digit returns over multi-year timeframes. And if you think about it this way, gold is more than 10 times the size of Bitcoin, right? It's $30 plus trillion dollars now. I think it's $34, $35 trillion in size. Bitcoin is $2 trillion in size.

If it managed to do triple-digit returns in, you know, a year, call it two years, then it would only take one-tenth of that same capital flowing from gold into Bitcoin to move it by a similar percentage. If you took two tens, right? So on and so forth, you get the picture. So the amount of capital that went into gold in order to move it the way that it did, even a fraction of that moving into Bitcoin would move it by the same degree. And once you understand the dynamics of Bitcoin over time taking on the monetary role of gold,

people understanding that Bitcoin is a superior asset from its monetary property's perspective to gold, then you kind of understand that there is a world where we see this S-curve event, where we see Bitcoin kind of go parabolic on the Christmas Eve or during the Christmas BTC sessions live stream, Samson was talking about the Omega candle. I think you could probably see something like that, but not necessarily like a one-day candle, a one-week candle, perhaps a one-year candle, similar to what we saw with gold. So to answer your question, I would have said no previously, like, you know, 10 years down the line when Bitcoin's $30 trillion, no way.

But seeing what happened with gold this last year, anything is possible. I think it's now on the table. So it sounds like you're saying we're all getting girlfriends. That's right. Exactly. Great. Cool. Yeah. Okay, Joe, let's close it out with, of course, this time, end of the year. We're going December 31st, 2026. What is your rough outlook, your best guess for the end of the year? Little friendly bet. Give me a price point. I'll take the over the under. We'll bet a ribeye on it. You got it, fantastic. We'll bet a ribeye on this. December 31st next year, $180,000 per BTC. A little bit more than a double from here. Look, you know, the reason is pretty simple. Big

has had a terrible last quarter. If Bitcoin is headed into a major bull market, then there is limited downside from here. We're talking about the high 50s, low 60s, worst case scenario. Best case scenario, this is a mid-bill market correction for BTC, and it's going to continue ascending higher. It helped even more by the fact that there's going to be a rotation at the margin out of monetary metals into higher beta risk assets, starting first with silver, which is a little bit riskier than gold, a little bit smaller than gold, then moving into equity. which is, of course, a little bit riskier than silver, and then moving into Bitcoin. And so, you know, ultimately, that's my base case.

If we have a prolonged bear market, I would expect it to end at some point in the middle of next year toward the end of the summer. And if we are not, which I'm leaning toward, I think, you know, 70, 30 percent confidence interval that this is, we're nearing the end of a really deep mid-bull market correction for Bitcoin, then basically up only throughout the lion's share of 2026. But that's the brass tax of it. The macro backdrop supports it. We'll have to wait and see.

Hopefully, I don't owe you a ribby. Beautiful. I will definitely take the over on that. I will say we're going above the 180. I'll say, I'll even throw, we're getting a two handle by the end of next year. I'm going to go for the two handle by the end of next year. All right. We'll see it.

Hopefully not $20,000. Hopefully it's an extra zero as well. Oh, dear God. That would be the worst win ever. It's like, guys, technically, technically, you owe me a mistake. Beautiful, Joe, please tell everybody where they can follow you, you, check out your work. Give them all that good stuff.

Yeah, absolutely. So for everybody watching on YouTube, thank you so much for watching to the end, by the way. Down here, wherever it is, just click Joe Consorti. I'm a collaborator on this video. If you're watching this anywhere else, just search up Joe Consorti on Google. You can find my X. You could find my YouTube there. Feel free to subscribe. I do a lot of Bitcoin and macro content, as well as talking about Horizon, which is the company that I'm building for U.S. homeowners to buy Bitcoin with their home equity. Hey, you. Yes, you watching the Bitcoin price movements and the latest exciting news. It's awesome to stay informed. But the real power of Bitcoin.

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It really helps out and check out the previous episode with TC on furthering your Bitcoin understanding.