The Pomp Podcast - #1019 Darius Dale On How We Get To Deflation

Starting point is 00:00:00 What's up, everyone? This is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Now let's kick this thing off. Darius Dale is the founder and CEO of 42Macro, the leading macro risk management advisor. In this conversation, we talk about what's going on in the macro economy, what's happening in the financial markets, how Darius is looking at various metrics, and also what you at home should be thinking about as you invest your capital. I really enjoyed this conversation with Darius, and I hope you do as well. Before we get into this episode, though, I want to quickly talk about our sponsors. This episode is brought to you by BCB Group.

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Starting point is 00:03:17 This podcast is for informational purposes only. We have one of the, I think, is smartest Wall Street analysts in the world. Darius Dale joining us. Darius, how are you, my friend? What's up, my friend? I'm actually changing my name to Sonny Swagoo officially as of today. I'm very swagged out. I don't know why, but let's go. Sonny Swagoo. I didn't know that we were going with wrestling names here. Absolutely. By the way, you just nailed a lot of different things that I wholeheartedly agree with. And I just want to reiterate for the audience, markets are forward leading. They price things in anticipation, particularly when there's clarity around dynamics that are changing dynamics within growth, with inflation, and especially within liquidity and financial conditions. And so very clearly, we're in the middle of a telegraphed, well-telegraphed liquidity cycle downturn. It's not going to end when people need it to end, but ultimately, it will end.

Starting point is 00:04:12 And eventually, one of the things that we think will catalyze that end is a recession. But prior to getting to recession, we're going to have to go through what we call deflation at 42 macro first. All right. I got a couple of things I want to talk about before we get to charts and data. Jerome Powell, the honorable central banker, was asked recently, Do you believe that inflation was caused by the Russia invasion of Ukraine? And he, to his credit, said, no, inflation was already pretty high before Russia invaded Ukraine. And then the politician who asked him said, well, why the hell is the president keeps saying that Russia's invasion of Ukraine is leading to inflation? Is this an important kind of data point in that now the central bankers, not only are they saying it's not transitory, but they're being honest is like kind of a weird word.

Starting point is 00:05:00 But they're at least being more transparent about what they really think are the drivers of inflation. And they're not just going with the talking points of any one political party. Yeah, 100 percent, man. So I feel bad for Jerome Powell, really any Fed chair that has to sit in front of our dysfunctional Congress and listen to what I believe are the dumbest series of questions out there. I mean, by Joe. But anyway, so, yeah, this whole inflation, what's causing inflation is very clearly a political football in D.C. And the reason it's a political football is because we're heading into a midterm elections where I'm pretty sure the Democrats are very clearly going to get smoked as a function of the inflation, the stock market crash, et cetera, et cetera. That's a perfect recipe for losing the majority in the House and Senate. With respect to Powell and this inflation narrative, he is being accurate. And this is something we've been talking about on your program all year, which is the broadening out of inflation pressure.

Starting point is 00:05:50 You know, there's a couple of statistics I'll throw at the audience, which is the median CPI. The Federal Reserve Bank of Cleveland maintains a statistic that shows the median price change across all the different hundreds of items in the CPI basket. And on a median basis, it's up 6.4 percent on a three month annualized rate of change basis, which is the fastest rate of all time in the time series going back to the early 80s. So we do have a problem with inflation and it's broadening out. And then with respect to this whole Russia-Ukraine nonsense, and let's put this to bed, or at least put it to bed from the perspective of our audience, inflation was at 7.5% in January of 2022 before Russia crossed the border and stepped foot into Ukraine. Two, when you look at what's actually driving inflation now at this particular juncture, it's now services inflation. Core services inflation at 7.8% on a three-month annualized basis. That's the fastest number we've seen since the mid-'90s.

Starting point is 00:06:41 Or sorry, not the mid-'90s, the middle of 1990. And so clearly, it's, you know, these are things that are have very little to do with, you know, rising food and energy prices, if you talk about, you know, the how much it costs to rent your home or, or get on an airplane or go in a hotel room. So another component of this is that he was asked, Do you believe that the United States is potentially headed towards a recession? And he basically said yes, which goes directly against the White House press secretary saying they do not see a recession being imminent. Janet Yellen saying she does not see a recession imminent and it feels to a degree that Jerome Powell is kind of breaking ranks he's being a little bit more honest a little bit more rational

Starting point is 00:07:25 intellectually humble even maybe to some degree how do you start to analyze if a central banker is doing that is he signaling that it may be way worse than people are thinking it could get or is he just trying to keep his own personal credibility so that when he leaves as the Fed Reserve Chairman He's got other opportunities, you know, from his kind of professional career.

Starting point is 00:07:46 No, a great question, man. And there's a couple of things I'll unpack towards the end of this. But the one thing I will say is that he's actually not breaking ranks. Don't forget, I'm going to say last month, he, Treasury Secretary Janet Yellen and President Biden huddled up together in the Oval Office to decide what would be the sort of plan to tackle inflation. And more importantly, I'm assuming what was also going to be their communication strategy. And clearly, the communication strategy is, from Yellen's perspective, hey, we got this wrong, we're doing something about it. From President Biden's perspective, it's all Vladimir Putin and the Fed's got to do something about it. And Jay Powell is willingly understanding that he's got the full weight of the credibility of the Federal Reserve Institution behind him, is effectively taking responsibility, being sort of the scapegoat and ultimately having to be the bad cop as it relates to getting inflation under control. I sent you a chart. It might be a little bit too wonky for this program,

Starting point is 00:08:39 but I tend to think that everyone has the ability to learn and grow. So can you throw up that chart? Powell is still fighting to maintain control over the bond market. Do you have that one? Yeah, the last one you sent us. Powell is fighting to maintain control over the bond market. What is this showing us? Yeah, so the second panel, the bottom chart is the more relevant one for this discussion,

Starting point is 00:09:00 which shows the term premium in treasury bonds. So that's a very wonky specific statistic. But in layman's terms, what it means is how much sort of extra yield do bond investors need to get compensated for to take the risk of just owning a bond? Because there's all sorts of different volatility with growth expectations, different volatility with inflation expectations, policy rate expectations, et cetera, et cetera. And right now, that term premium is a minus six basis points. You go back to the last time we had the Fed lose its credibility in the mid to late 70s, all the way into the early 80s until Paul Berger started to get it back. you saw that statistic go all the way up you know four or five hundred basis points and so right now what this is telling you is that the bond market still believes the Fed is going to do something

Starting point is 00:09:45 significant to get inflation under control which is why Powell feels comfortable being the bad cop it'll be a lot more difficult for him to be the bad cop if we were at much higher levels on this chart I mean at minus six basis points that's an eighth percentile reading since going back to the late 1950s so he's got a decent amount of credibility he's got a window to use it now if this window closes, and we don't get inflation under control before the economy slows down significantly, then he's going to start losing a significant amount of credibility. And that could be all hell could be breaking loose in the bond market. So if we go and we take a look at the the topping process, you said topping process is market in market based inflation expectations,

Starting point is 00:10:23 help people understand what a topping process is, and then how that relates to these inflation expectations? Yeah, great question, Pop. So topping processes, so tops are generally processes, right? Like if you look about, like look at a chart of a stock, but you look at a chart of Bitcoin, right? You know, actually, Bitcoin tends to have these blow off tops, it'll eventually mature as an asset class. But you can look at a chart of the stock market as an instance, you know, they tend to sort of crest into the peak. And when you look at market internals, you tend to sort of lose leadership along the way into the peak. And it's usually this sort of very absurd, very measured process, whereas bottoms are usually catalyzed by some sort of

Starting point is 00:11:01 cathartic event and eventually some sort of very aggressive policy response to get you going in the other direction. So what I'm showing in this chart here is two-year, five-year, 10-year, and 30-year inflation swap rates. This is what the bond market is betting inflation is going to be over the average of those durations. And so clearly, the bond market is saying, hey, look, we are no longer comfortable pricing inflation expectations up and to the right off the top of the chart anymore. Clearly, inflation on a reported basis is up and to the right off the top of the chart. But the forward-looking sort of market, going back to our discussion on how markets forward-looking, the bond market is starting to say, hey, I think we're starting to peak out in

Starting point is 00:11:39 inflation expectations terms, which takes me to sort of this next part of the discussion, which you were talking about prior to me joining the program, which is this eventual transition to deflation. Deflation, going back to, you know, I've been on the program for a while now, but for those of you who are new, you know, we run a sophisticated sort of systematic regime segmentation process at 42 Macro to help investors manage macro risk. And one of those regimes is called deflation. That's where both growth and inflation are slowing it simultaneously. You know, that's, you know, generally speaking, it's a lot of what you've seen on your screens year to date could be a little bit worse for certain asset classes, but also a little bit better if you think, you know,

Starting point is 00:12:17 think about bonds, you know, potentially starting to rally, but very bad for things like physical commodities, et cetera, and digital commodities, et cetera. And so maybe this is a leading indicator of that sort of eventual transition to deflation, which we must, we must go to, we must go through in order to get to the good stuff, get back to the good times. So if you then take a look at this, like pivot that could potentially be coming, They claim they're not going to do it. They claim they're going to stay steadfast. There are appeals to the Paul Volcker-esque era

Starting point is 00:12:52 and his approach to markets and inflation. What do you see here with the real yield curve? Yeah, so Powell gave us a lot of information, which, by the way, this guy, I know he's getting a lot of heat for this inflation problem, and to a large degree, he is partially responsible for keeping his foot on the gas last year amid all that record fiscal stimulus but just in terms of would you rather have janet gellan

Starting point is 00:13:17 alan greenspan or ben bernanke or jay powell right now definitely rather have jay powell right now are you kidding me yes um no it's easy to dunk on him it is very easy to dunk on him because of the situation but he is incredibly intelligent and i actually think out of all the people you just mentioned he's the most measured and appears to be the most uh unemotional about the market because he's an investor this guy's worth 100 million bucks you're working at carlisle you He knows what he's doing. So at the end of the day, he's very honest and he's given us a lot of information in terms of what is spooking the Fed and ultimately what might unspook the Fed. And so going back to that real yield curve, there's two charts that are effectively sort of monitors that I think investors should be paying attention to to help them understand when the Fed might pivot. So this one right here, we'll go back to the other one. So this right here, structural inflation expectations.

Starting point is 00:14:04 You know, he talked a lot about this sort of five-year forward University of Michigan inflation expectation reading that jumped off the chart the same day we got that May CBI report. And so when you look at where that statistic is currently at 4.3 percent, you know, we got to basically break back down 100, 130 basis points on this statistic to give the Fed comfortable credit or sort of, you know, quote unquote, clear and confirming evidence that core PCE is getting back to its target. Its target, let's call it 2.5% on the upper boundary of that average inflation range. Going back to the previous chart, the real yield curve, he said another thing he wants to see in order to judge whether or not financial conditions have tightened enough to really give them comfort before they even consider a pivot, which is real yields across the entire treasury curve and real yields. And so this is the two-year, five-year, 10-year, and 30-year across each of those panels. Nominal treasury yield deflated, so subtracting the inflation swap rates from each of those tenors. And so right now, we finally started to achieve it on the five-year and 10-year.

Starting point is 00:15:09 We've been achieved it on the 30-year, but we're still quite a ways away, about 110 basis points away on the two-year, which means they got some more hikes to do, and they got some more jawboning to do and got more quantitative tightening to do to give them comfort that the bond market is really starting to get under control from the perspective of inflation expectations. And ultimately, that'll filter through the economy on the leg. So when you start to think about this last chart you have here, the Powell pivot monitor structural inflation expectations, one of my big questions is, if they are aggressive, and they are able to destroy demand, which appears that they are heading in that direction

Starting point is 00:15:47 and successfully at least have some movement on. Could we get stagflation? Like you mentioned deflation earlier, but is there a world where inflation stays persistently high and they also destroy demand? And from an economic standpoint, we get some sort of stagflation situation? Yeah, so we will have some sort of,

Starting point is 00:16:06 I mean, depending on how you define stagflation, right? If you define stagflation as above trend inflation and below trend growth, then yeah, we're definitely headed for stagflation. I mean, there's no question about that. if you define stagflation as persistently above-trend inflation and persistently below-trend growth, then I think that question is to be determined. If this Fed is comfortable sending us into something that is more than a mild recession in order to really kill inflation

Starting point is 00:16:31 once and for all, then we won't have a persistent stagflation. If, however, we get to a mild recession or something that looks like that, and the Fed is really starting to back off and stepping on the gas pedal again, then it's very likely we have something that looks like persistence to inflation. So it's path dependent. It's very difficult to ascertain the answer to that question now, but I'm not really sure you need to answer that question now. The next major catalyst for financial markets is this transition from inflation, where inflation is going up and growth is going up and the market having to price that in, to deflation, where both growth and inflation are going down, potentially into a recession. So when you start to look at various

Starting point is 00:17:09 asset classes what assets do you think are best positioned if that's where we go is it just cash yeah is it cash or is it something else no so uh cash is king right now when you get into deflation you're going to unlock the entire sort of global sovereign debt market which has been a hard sell really for the past you know call it nine six nine months um and so you know once you get into deflation once the bottom market is comfortable that the inflation problem is being dealt with that, you know, the doctor, the surgeon has successfully amputated the gangrene foot, then we're comfortable, you know, sort of getting back in the pool, getting back in the water. And so that's going to be the next big pivot you're going to see in financial markets is bonds really

Starting point is 00:17:51 start to move to the upside and price downside and yield and maybe temporarily. And I think so that's I think what's happening today, particularly, you know, in the crypto space, you're seeing a significant decline in long term bond yields, you know, really born out of the sort of recession fears rising in Europe. And that's really kind of, you know, cascading through global sovereign debt markets, including our sovereign debt market, which by the way, like week over week, we've lost like 40 basis points in the 10-year treasury yield, just like that. You know, so when this stuff moves, it moves. And in the, you know, the very near term, bond yields going down is the old sort of, you know, buy NASDAQ, buy crypto trade, right? But eventually it's

Starting point is 00:18:28 going to be bond yields going down, sell NASDAQ, sell crypto, because I need more liquidity, I need cash. And these things are not working. So Vladimir Putin, president of Russia, recently gave a speech. And I got to say, it may be one of the most honest assessments of what's going on right now. And a lot of people will discount it because Vladimir Putin saying it. I want to put a huge disclaimer. Myself, not a huge fan. I'm assuming you're not a huge fan either. But let's take away a for a second who's saying it. And let's look at what is being said. And he said things like, look, the global economic system has taken a blow. The United States levying the sanctions they did against Russia and taking the FX reserves now has a lot of countries around the world questioning whether they need to keep their own central bank reserves somewhere else or in a different type of asset.

Starting point is 00:19:22 He talks about the fact that the United States went from a net exporter of food to a net importer. He talks about the money supply has grown by 38 percent and the amount of importing is somewhat related to that. He talks about the EU. Like, I mean, he just did like a crash course, almost a masterclass in macroeconomics in this speech describing. Are these people dumb is essentially what he says. And he's like, they are doing things that are actually hurting them more than the people they're trying to hurt. Is this the canary in the coal mine? Like if Vladimir Putin's saying this in speeches, how do central bankers, like, do they just like, oh, whatever Putin says, we don't listen?

Starting point is 00:20:04 Or are they acutely aware of the situation? Oh, no, I think they're acutely aware. I mean, when you listen to guys like James Servetus, who's a former chief commander of NATO, when he talks, obviously he's very plugged into the political benefits in D.C. They, you know, he's talking about the very same things, which is, you know, the sort of, you know, the two-sided risk associated with, you know, basically being very harsh on Russia and on Putin for this Ukraine incursion. There is a range of probable outcomes here, and not the least of which is the world splintering from the perspective of the currency system, you know,

Starting point is 00:20:39 the sort of de-globalization, you know, you're going to start to see labor forces really start becoming more sort of, you know, marginalized, you know, et cetera, et cetera. You know, we're moving into a world that's just going to have structurally higher inflation because there's going to be more structural friction in terms of transacting across borders um you know you know that you being able to use different pockets and pools of labor we have shrinking labor forces in places like china and stuff anyway so that's going to be an issue so i think he's absolutely on to something i mean this stuff not going to happen overnight right like you know i remember when i was a uh i was a kid you know i must have been in i don't know like eighth grade or something

Starting point is 00:21:15 in 2001, in the WTO riots in Seattle. And I remember thinking like, man, this is a big deal. But I didn't really understand the full consequence and the full scope of why it was a big deal. It was just, you know, people were getting killed. It was a really big deal at the time. Turns out, hey, we shipped most of our manufacturing jobs to China when they joined the WTO in 2001. So looking back 20 something years later, it was obviously a big deal. And I think, you know, from today, looking forward into, you know, 2040 something, we'll look back on the big deal and say, man, when they did that thing with the Russian reserves and really splintered the whole global currency system, it'll be pretty clear from that perspective. But right now, looking forward,

Starting point is 00:21:52 it's going to take time. There's going to be all these different processes. So you can't put the whole trade on today expecting to make money on a two decade long kind of a catalyst. But we definitely are moving in that direction. When you start to look at financial markets, uh bonds and most fixed income just absolute trash frankly uh but all of the foundations the endowments the pension funds they've got huge huge allocations to this fixed income is there a world where that will actually prove to be a smart investment over the next decade or is it a world where actually this idea of like a 60 40 global portfolio a huge allocation of fixed income like all of these things that maybe were considered modern portfolio theory

Starting point is 00:22:35 People are going to have to unlearn and actually learn a different way of investing, given the macro environment and some of the things that we're seeing central banks do. Yeah, so I got to tip my cap to Peter Atwater, who's on the Top Traders Unplugged podcast recently, who talked about sort of the souring global mood and how that's likely to lead to deglobalization. and among other things, is likely to lead to sort of a reigning in of sort of fantastical investment opportunities. And part of the reason we've had such fantastical long duration speculation in asset markets is because we've seen multiple decades of disinflation, of globalization, of demography, all these sort of major factors that have contributed to lower and lower inflation, easier and easier monetary policy at every juncture, right? We are no longer in that mantra. We're going to have higher highs and higher lows in inflation, higher highs and higher

Starting point is 00:23:31 lows in bond yields, and sort of higher lows and lower lows and lower highs in anything associated that needs bond yields to go down to work. You know, I don't want to say, you know, crypto is part of that, fully part of that sort of amalgamation, but it is definitely something that's really benefited, right? So, you know, I think when you look forward for the next 10 years, I don't even, you should not, by the way, don't ever listen to somebody talk about 10 years from now. If someone has a process to consistently predict 10 years from now, then they shouldn't be telling you anything. They should be counting money on a yacht in the Mediterranean, right? No one knows what's going to happen in 10 years from now, but we can ascertain based on these big

Starting point is 00:24:09 trends. We can analyze trends. So going back to analyzing the trends, it's very likely the next 10 years of investing are very different than the last 10 years. The last 10 years is crazy Federal Reserve balance sheet expansion, interest rates at or below zero on a real basis consistently throughout every major economy, even some major emerging market economies, to a world where the scarcity of resources, scarcity of labor, higher rates of inflation, bond yields are trending higher not trending lower. And that just makes your asset allocation decision making very, very different than had been. The concept of 60-40, maybe it's not dead, but will it have to go to 60-30-10 or 60-20-20 to make room for things like real assets, real estate, etc., Bitcoin, I don't know. But I

Starting point is 00:24:56 think it's going to be very different. I think if you're sitting here today in a 60-40 style portfolio, and you got 10 years to retirement, best of luck with that. So I agree with everything you're saying. The one variable that I keep coming back to, Bitcoin. Mark Mobius, I think is how you say his name. He was a previous Bitcoin skeptic. He was recently on television. He seems like he should be all in on bitcoin like he's such a long-term bull he he uh he previously was but what he said was uh he thinks that bitcoin is a leading leading indicator now and he thinks that it has a very significant psychological impact on markets and i agree i agree when i come back to the asset it sounds a little crazy to say but it feels like bitcoin is the most free market macro

Starting point is 00:25:43 asset we have. And if that is the case, it is likely to be something that has to be in everyone's portfolio, right? It's the first thing I check every morning. It's the first thing I check on Saturday mornings. It's the first thing I check on Sunday mornings, because it's the only free market out there. Every other market is grossly manipulated, some form or fashion, either by regulation, central banks, fiscal authorities, some form or fashion. It's the cleanest market we have today. So yes, of course I agree. When you think about that, obviously price can signal sentiment shift or, uh, or kind of shifts in the market. If it is the cleanest market we have, does that mean that many of these investors eventually say, I got to have it in the

Starting point is 00:26:27 portfolio or just because it's the cleanest market doesn't necessarily mean that people will allocate to it? Uh, I think people want to allocate to it. I haven't, I don't talk to too many institutional investors at this point that are on the other side of the trade. They just might not be, from a regulatory standpoint, allowed to put the trade on in size. It's very difficult for Citadel or BlackRock to allocate significant chunks of capital, hundreds of billions of dollars of capital, if not trillions, to something like Bitcoin. One, it's extremely volatile, but two, there's no real regulatory framework or real understanding of what would happen if things go wrong. We assume things aren't going to go wrong, and we're all believers

Starting point is 00:27:07 watching the show here, but something in theory could go wrong. Like what if the network was hacked? Something like that. You know, I don't know. And so like the wall street needs the sort of certainty associated with, okay, if something goes wrong, here's how we deal with it in the legal system. Here's who gets their money back first. Here's who gets their money back second, third and so on and so forth. So, you know, this is, that's kind of the main issue with something like Bitcoin and why it's been sort of a slower moving adoption phase from an institutional investment standpoint, as opposed to what I think is a very clear and obvious, we should be in this asset. I mean, I haven't talked to a hedge fund portfolio manager or mutual fund portfolio

Starting point is 00:27:42 manager that doesn't have personally allocated to Bitcoin, but they can't do it in their funds and for a variety of regulatory reasons. So my last question for you is earlier when I was talking about Bitcoin as an inflation hedge on the way up and people moving capital before inflation shows up, Bitcoin coming down, along with other assets, I stated that it was in anticipation of the Fed destroying demand, pulling down inflation, and people moving their capital elsewhere. After I've said that publicly, pretty much all of these, I don't know, nice term, nerds, in the traditional financial system are like, look at this idiot, look at this moron, what are they talking about like all this stuff how do you view the fed stepping in being hyper

Starting point is 00:28:34 aggressive with interest rates raising quantitative tightening on the horizon if not already started and bitcoin or other assets coming down how do you kind of relate that to the anticipation of future market conditions versus uh no these are all just speculative tools and uh uh the bitcoins were stupid yeah so like i'm looking on boomer now we just lost 15 20 in oil in like a week a price of oil so like how is that any different than bitcoin pricing and eventual transition to depletion you know i i don't i think nerds is probably too nice of a phrase to talk to anybody who doesn't understand that financial markets are forward-looking and anticipatory right like if you're talking to somebody who's in traditional finance that thinks that's wrong they're not

Starting point is 00:29:18 going to be in traditional finance very long so i wouldn't worry about too much about their their commentary. But yeah, no, so you're absolutely right. The market is sniffing out. And this started last Wednesday, in my opinion, with the Federal Reserve press conference, with Jay Powell's press conference. I live tweeted the event. Are you going to go back and check the event? And I think what's happened is the market finally figured out that this is a Federal Reserve, as we've been saying on your program and every piece of research I've been writing all year, that this is a Federal Reserve that's comfortable slowing the economy enough to get rid of inflation. And that is very different than the Federal Reserve reaction function,

Starting point is 00:29:52 the regime that we're exiting, which is a Federal Reserve that anytime we had a hiccup on the growth side or hiccup in financial markets, that became their number one priority. Their only priority right now is dealing with inflation, and they're going to have a mop in the closet to clean up the mess whenever the mess comes afterwards. I think that Bitcoin at $20,000 right now is showing much more resilience and gives me much more confidence about how it will perform in the future than when it was at $69,000 because it's down 70%, right? Stocks are down, bonds are down, real estate, everything's down. But when you look around the room and you ask people, what do you want to own for the next

Starting point is 00:30:43 10 years it brings me back to november of 2018 and we issued a million dollar challenge anyone on wall street pick any asset we'll take crypto not one person picked a single asset and if they had we today would still be up like 650 percent 100 and it already crashed 70 percent that tells you everything you need to know. People will talk, talk, talk on Twitter and talk some more because that's where people go to talk. But what happens in their portfolio is a very different story. What happened, you know, I'm telling you that I haven't talked to anybody in a long time on the institutional investment side that is structurally short Bitcoin. You know, I think people get at the trade, they get the joke. And certainly anybody who's doing as much analysis

Starting point is 00:31:34 as we're doing understands how these big cycles are turning from a growth, inflation and policy standpoint, deglobalization, et cetera, et cetera, understands that the market allocation to fixed income and associated allocations to mega cap thing type names and everything that was sort of highly correlated to that, that allocation, that market allocation was wrong. The valuations associated was wrong. The price was wrong. And we're seeing it on our screens today. So we're in the middle of a big phase transition from a structural perspective that is also sort of getting tied up in the cyclical aspects of the economy as well if you talk about inflation and maybe potentially heading into a recession i um uh i'm not going to name names here but i'm going

Starting point is 00:32:15 to consider screenshotting all of these tweets and then make a little video later send them my way man you know we're gonna make a we're gonna make a uh we'll make a little video and then we're going to uh wait and i'll set like a calendar invite for like three years four years from now maybe Maybe two and a half years. My boss has been short Bitcoin the whole time, which makes no sense. Yeah. No comment. The whole time, like since 2009.

Starting point is 00:32:44 Yeah, yeah, yeah. No comment. All right. Where can we send people to find you on the internet? Yeah, no. I'm at 42MacroDDale on Twitter. 42Macro.com. Come check us out.

Starting point is 00:32:56 If you're a serious investor, we got serious research for those who don't like getting blown up. Cheers. all right my friend i appreciate it very much i always enjoy these conversations uh the beautiful thing about financial markets is there's a lot of people with opinions on the internet but uh if they go and they look at the scoreboard i don't think almost any of them have outperformed bitcoin over uh the last two years so um you know 100 you you're a football player too whenever you have some jamoke on the field talking after you're destroying them what do you say you Just point to the scoreboard.

Starting point is 00:33:31 Scoreboard, chump. Get back to the auto. And then wave and just go back. Get back to the auto, chump. All right, we'll talk next week, Darius. I'll see you, man. Be good, brother. Later.

Starting point is 00:33:44 Thanks so much for listening to today's episode. I really hope you guys enjoyed this one. Make sure you're subscribed on Apple, Spotify, or your favorite podcast player. And if you're looking to try to transition to get a new job in the Bitcoin or crypto industry, we've got you covered. Head over to palmscryptocourse.com

Starting point is 00:33:58 we've developed a curriculum with the top teams across the industry it's a three-week intensive training program with over 50 events packed into that three-week time period go to pompscryptocourse.com to learn more and i'll meet you guys for the next episode

The Pomp Podcast - #1019 Darius Dale On How We Get To Deflation

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