The Wolf Of All Streets - Bitcoin CRASHES To $76K — $661M Wiped In Hours (Macro Monday)

Episode Date: May 18, 2026

Bitcoin just dumped to $76,711 — its lowest level in over two weeks — with $660 million in liquidations vaporized in hours as the Iran war, sticky inflation, and a fresh wave of risk-off positioning sent the entire crypto market into a tailspin. The pain is bleeding into Main Street too: Toyota is warning of motor oil shortages, grocery prices just jumped 3.2% year-over-year, and crude oil remains elevated as Putin lands in Beijing to meet Xi just days after Trump's own summit. Meanwhile, NYDIG warns the CLARITY Act could stall past the midterms if the Senate doesn't move before August, Iran is reportedly launching a Bitcoin-settled shipping insurance scheme through the Strait of Hormuz, and Trump's pivot on Chinese farmland and student visas has MAGA in open revolt. Is this a textbook "sell the news" flush after the CLARITY Act win, or the start of something much deeper? Buy the dip — or run for the hills? Learn more about your ad choices. Visit megaphone.fm/adchoices

Bitcoin crashed almost $76,000 today, liquidating $661 million. Do not use leverage, kids. It's a pretty simple answer to not getting liquidated is to not use the leverage in the first place. But once again, we have Bitcoin dropping and a whole lot of geopolitical turmoil. People believing that the war in Iran might ramp back up, of course, Trump in China, with President Z and global bond crisis. I think it's fair to say at this point.

We're going to unpack all of that with James, Dave, and Mike. Right now, we got the whole team back, assuming Dave shows up. All right, let's go. Good morning, everybody, and welcome to Macro Monday. As I said, theoretically, the gang's here, but Dave hasn't showed up yet. But James, people have really believed you quit on us. I couldn't convince them otherwise. It was like, James, it's not coming back.

I told them you were. You're here. Mike, let's start with the morning. Give a minute for everybody. to breathe and we're back at it let's go yeah let's do it okay it's good to have james back and i'm sure um dave will show up he's quite consistent and reliable um stark polar economist focused first on the fomc minutes it's kind of the highlight this week was from powell's last meeting thinks most participants will express neutral language um and focus on the upward pressure and

inflation most notably due to oil and downward pressure on economic growth not so much here but but rest of the world. Fed expected to hold. Last week's inflation was certainly going to enhance and support the hawks. Rate cuts unlikely anytime soon. And then housing starts likely decline. He pointed out at home builders are becoming

bloated with the inventory and have to reduce costs. Ira Jersey, our interest rate strategies, came on that key level in the 10 unit was 466, the yield resistance in the 10 year note. Not huge and surprised why we're here because of oil, feds on hold and inflation related front ends being driven by the inflation break evens um before war's conclusion expects it to drop so still sticks with the consensus for a steepener doesn't c2 is getting much below 365 which is fed

funds and things are probably going to go there um fed minutes the highlight of the week as he pointed out and doesn't and he did a okay did a survey last week and the consensus is most people do not expect worse is going to really be able to shrink the balance sheet a lot i've got a little more from the meeting but i think this is going to fire up um James a little bit. Chris Kane, our stock strategist, point out the earnings season is wrapping up. We have Navidia on Wednesday, and they just blowouts, 27.5%. Year of year-of-year, S&P 500 earnings growth in Suffa. I always remember 8 to 10% my whole life. I mean, that's just a shocker, but that's a fact. Valuations, and he did a lot of analysis on AI stocks, I think there's like 70 in the basket

and pointed out forward P's are actually cheaper than the past because expects 40% growth in earnings there. and most of the AI stocks. And momentum is the strongest factor so far over the last six months. Audrey Chilt Friedman, our FX strategies, point out the dollars to do, probably to continue to do better as the war continues, as the rest of the world suffers, and more and more of the rest of the world's central banks talk in hikes. And then I focused on one simple thing to let the facts distort from what people's views are in markets is the only sector that's made a new high in commodities this year.

are precious metals. Energy, the Bloomberg Energy Spot Index is the same as 20 years ago. It's near the upper end of the range. Agriculture, the same as about 16 years ago. It's kind of just bouncing a little bit. And energy, so I pointed that out.

So only precious metals, and I just pointed out that these things typically don't last in energy. It's its own worst enemy. And also, I reiterated there's a big problem with being bullish metals, as I mentioned I'm going to be here. I'm here in New York this week. I'll be presenting at the

Metals Conference, SME Metals Conference, and they might not invite me back. I've been presenting there for 10 years. I'm always been bullish, and I'm not bullish, I'm. I just can't be bullish gold ones 2.3 times the ball to the S&B 500. It's typically assigned historically you're supposed to say thank you and get out. Back to you. All right,

with Dave's here. I've got him on mute there. There was a little background noise. But James, I mean, he teed you off in a lot of ways, and I want to just go right to your newsletter, like Global Boll. markets are imploding. You know, is everyone turning Japanese? Because I read the first paragraph and I just had this big like, thank you moments because

you said, welcome to the Thunderdome, Kevin Warsh. And I spent all last week just wondering why on God's green earth this guy would ever want the worst job in the worst possible moment on planet Earth. Literally, it's 10-0. You're stepping in and you're supposed to be the relief pitcher. like it's good luck man like this is just such a mess um well you know like last week we had two pretty hot inflation numbers come in with cpi and ppi um and i didn't really talk about that in the letter but you know the bottom line is that uh you've got all you've got global bonds the fiat currencies

are they're showing the stresses of of leverage and and the debt-based system and um you know the you're watching in real time, the Japanese, their long bonds, a 10 year and their 30 year are just exploding higher. The yields. So when we talk about bonds, we quote it yields. All time high for their 40 year, just for the record. And when that number goes, thank you. Yeah, when that number goes up, that's bad. It's bad for bonds.

It's bad for anybody owns bonds. it means that investors are demanding a higher return, a higher yield for owning these things, which finally they are. If you bring up a chart and I'll bring up this chart so you guys can see it and then maybe it'll help understand. But the, let's see, you see this, Scott. You know, if you look at, in this shows, this doesn't show every single bond we're talking about, but you've got the UK guilt.

You've got obviously the Japanese, the JGBs, the government bonds there. You've got the German bonds, the Bundes bonds, you've got the French bonds, and then, of course, US. And you can see that every Western developed country has kind of been moving in lockstep here. Even though the rates are a little bit different, you can see on the side here. But they've been moving in lockstep together with the U.S. is, you know, you know, the U.S. is now, this, this is shown the 10 year is at 4.6%, which is pretty high. And it's getting to a point that's probably getting the Treasury nervous. If I'm Scott Bissent and I'm watching this, I'm like, this is, this is not going to be,

it's not going to be fun for the next couple of years. And so, but you can see that from early 20s, or 2020, 22, I mean, they had zeroed out and stayed here at zero or negative. So some of these rates were negative going into the lockdown period of COVID. They were actually, if I remember correctly, we had like $6 trillion of negative yielding bonds in this period. And so, you know, they just exploded higher with all the printing of money. It's clearly we printed a bunch of money and all the yields exploded higher to

to compensate for that. Then they hung out in this in kind of a training range here, and it looks like they're beginning to break out. So if you look at the recent activity, it looks like they're regular breakout. Now, the question is, are they breaking out because of expectations of the energy prices just remaining high for an extended period of time? Or are they breaking out because they know that all of the Fiat-based government debt, all of these central banks have little choice, but to continue to print money to keep this whole thing going. And I wouldn't say that the patient's on life support yet,

but the patient is absolutely 100% addicted to excess liquidity. And that's what we're watching in real time here. And can it explode higher with the, conflict in Iran and with the Strait of Hormuz? Absolutely. And that's one of the things that's a little bit, it's a little bit scary as you're sitting here and you're watching these things. Like where did where do all these push? This is and just to be clear for everybody who's watching listening that this bomb, the the government US Treasury the 10 year is that is the that this is the benchmark treasury of the world. Okay. So when you're in the U.S., when people look at 30-year treasures, like, oh, my God, look at where 30 years are. That's where the, that's basically where mortgages are. Now, the mortgages, credit card rates, all the loan rates, insurance, everything is keyed off of the 10 year, the U.S. 10 year. And as that explodes higher, everything moves higher. So I think the, the mortgages are trading somewhere around 7% now or even a little bit above those today, above 7%.

today. So this is a problem that's not going away. It's just not, it's just not going away. And so the question about whether or not we have rate cuts coming when you have this happening. And you know, you've got bought the Fed does not control this. That just, I want to make that abundantly clear. The Fed cannot control the 10 year with cutting rates with their, with their mechanism of rate of, of rate cuts at the front end of the curve, which is just this guy. That's not, you know, the Fed Fund, sorry, that's not going to, that's not going to affect the 10 year. The 10 year is a completely different animal, and it's keyed off of what bond investors

are demanding for yield. And so if they believe that the Fed is cutting too early, these rates are going to explode even higher, which is what we saw back in the election. the presidential election, when Powell cut rates by 50 basis points, the 10-year exploded up, the 10-year yield or the 10-year yield exploded up 50 basis points. So it was in a direct reaction to the Fed cutting too early is what they were telling. And they're like, no, the inflation isn't, has, has not been conquered yet. You guys are crazy.

So this is what we call the bond vigilantes, where they're just like, where they're going to demand more yield. And so who's doing this? Well, it's the institutions that have to buy bonds and they're stepping back. And as they step back and the demand lowers, then the yield has to rise in order to compensate people enough to come back into the market and buy them. So that's what we're kind of watching in real time. And if you think that Worse is just going to come in and cut rates suddenly, I don't see it. It wouldn't even work.

That's why he has the worst job, right? Because the debt service is such a huge problem, and there's nothing he can even do about it. When people have been screaming at Powell, you need to cut for the debt service, like you said, it's not even going to matter. It's not going to matter. And then if it's crazy, I mean, what's that one? Chinese holdings of U.S. treasuries have dropped to their lowest level since the 2008 global financial crisis.

Like, these are not popular instruments for foreign central banks anymore. You know, I mean, there's a number of reasons for that, as we've spoken about before. But the leaders around the world who are not the close allies of the U.S. and the central banks, they know that we're printing money and they don't want to hold something that's going to be worth 50% of what it is today in 10 years. Like that just doesn't make any sense to them. So, of course, they don't want to hold those. And, you know, you could say, well, you're being compensated on the front of of the curve you could buy u s you could buy t bills and just roll those over which many of many

investors do and that's why we're seeing so much demand at the front end but you're still not being compensated for real inflation like the actual inflation um you know you can't tell me that 3.8% covers all of your your home insurance car insurance like all of the health insurance like it's that they're up so much there was a really good uh post i think it was it charlie billi who who who post it with all of the different, all of the different rates of inflation of the different goods. I mean, it's, it's, it's, it's, it's, it's, it's, it's, it's, it's, it's, it's, that they're, they're claiming it's three and a half percent. Yeah, like coffee was at a top at 105 percent in five. Exactly. I showed that chart a number of times. Who is it, was it, yeah, I can't

remember who it was. Yeah. So, you know, it, this is the thing. Okay. So now we get to the, the, the, the question of, well, you know, what's the Fed going to do? And if you're Scott dissent and you're watching this and you've been, you were hammering the Treasury and Yellen about terming out the debt before the election and then suddenly, because now you've got rate cuts coming, you're expecting all the rates come down, you're going to be able to term out the debt because inflation will be conquered. And then, you know, your president starts conflicts that are inflation. Here's the crazy things. I don't think we've even seen.

And Mike, maybe your analysts dug into us a little bit further in the call today or recently, but I don't think we've seen the effects of the Middle East conflict yet in pricing. I think we're seeing it in producer price index because that moves first. And the producers will start raising rates with expectation of inflation. But the consumer rate is not really reflecting it yet. So that's also a little bit troubling. But that's kind of where my head is this morning as we watch all this. Dave, I don't know if you've been listening.

Mike, your response, if not. I'm trying. Can you hear me now? Yeah, you sound good. Yeah, well, sorry, the hotel Wi-Fi wasn't good. I had to move down closer to their ballroom to go to that Wi-Fi. That one seems to be working. So sorry, guys.

I've been in the glitch. No, it's okay. I was asking Mike if they, if his analysts have dug in it all about the reflection of recent conflict in the Middle East on actual pricing. They did it in the meeting, but our senior energy strategist, one base in Dubai, the other in London, still think it hasn't been fully reflected. Now, I disagree. I disagreed with their same view back in 2022. It's because of elasticity. But the key thing that's missing from then versus now is that wealth reversion. We haven't had that this year, which means more

inflation and there's like you point out there's that's a hiking environment it's a hiking environment now here's a and so markets are pricing in a hike much higher than a cut at this point right like by by many multiples so it's close yeah it's uh you know here it is i can i've got on my screen now but um let me share this and you'll see it but the the the you know it's of of course it's not uh this isn't this isn't all of it like this isn't the whole story this is this isn't the whole story this is is just part of the story, right? Can you see this, Scott? Okay, so this is easier to see this, but you can see this is the number of hikes that are priced in. So here's the implied rate. Here's the date. So earlier this year, these were negative, meaning that we were expecting

rate cuts. And now you're seeing, you know, more than one rate hike priced in for 2027. So into next year. So we're basically seeing no rate cuts at all. We got a slight probability of a rate cut here, just a tiny little bit, you know, going into the June meeting, but that's so unlikely in my mind. But that's only part of the story because the Fed has, they have two levers. They've got this and they've got QEQT. Those are the two things they can do. So the question is this is where this and this is where the, the, the,

money printing starts to get out of control is if they don't hike rates because it's just politically unpalatable and they you know the they the fed let's be clear about who we're talking about here because we always hear they are doing this and they're doing that but if the fed does not if they if they don't hike rates because it's politically just unpalatable and the inflation continues to just rage regardless of what's happening in the Middle East because who knows and at the same time you've got kind of stagflation here what do you think they're going to do of course they're going you're going to have some disruption in bond markets and they're going to start printing money and doing something you know along the lines of operation twist where they're

they're buying the long end of the curve to do yield curve control which is what japan did for so many years and everybody will you know we will hear not everybody will hear a lot of analysts say yeah what Japan did it for so many years it's not going to be a problem well we're different than Japan it's it's not the same animal by in any stretch of any imagination so but this is we're definitely entering some seriously interesting times so be nimble in your portfolios Dave you know every time I hear Keynesian conversations about inflation it makes my head hurt James and I both comment this from the notion of we print money, money's worth less, and therefore inflation is higher.

The real question is, when you get external shocks and oil shock, it takes the ability to, it's sort of like there's this river and you want to divert it. And we've diverted very well for 40 years. We made one stupid mistake and we know what happened. We've diverted very well from consumer inflation to asset inflation. That has been the stated policy of the entire unit party of everyone in Washington effectively since Reagan is push assets up and try to do so at why minimize the consumer inflation, which is relatively straightforward when there's a lot of technological change. Technological change allows you to produce more with less, which is why the very real

K-shaped economy conversation comes into play. It's a very real conversation. But that conversation turns critical when, and the K-shaved economy for those who haven't heard it or maybe new listeners is the fact that capital markets, all assets are pushing all-time highs and wages are getting not all-time lows because obviously the Industrial Revolution, et cetera, but are gone, have trended significantly underneath that relative to GDP. Now, if you add an external shock that creates inflation to the mix, which means wages aren't keeping up with that inflation at the same time, assets are, that gets even worse.

And politically, that's what's causing what you're seeing. And, you know, this isn't about, I mean, everyone in this country is so obsessed with Trump, that that's all they talk about. But what this is about is this is about insanity versus normalcy. People rationalizing that the AOCs, Bernie Sanders, and Zoroam, Mamdani's of the world are normal, are missing the fact that the reason they exist is because we have this case-shaped economy and we're making it worse because, or it's getting worse, because of this external inflation shock, making people really hurting.

Dave, Mamdani, balance the budget. Oh, please, dear God. I mean, okay, since you said, I was like, wait, what? Where's that? Right. Yeah, he balanced the budget by pushing it to out years and underfunding pensions, which is exactly what did in Illinois and see exactly how well that's. And borrowing $8 billion from the state.

Oh, yeah. And oh, by the way, the part of his savings, the largest single piece of his savings is that he is, is said, well, we're not going to hire for, vacant positions, except for 500 plus of those vacant positions are NYPD officers who have retired or left that they were going to hire for. They're now and out going to. Welcome to New York. I'm actually in New York right now, and it's going to be welcome to the Thunderdome, but it doesn't happen immediately. It takes years. It takes years, but fuck up a good thing. He really does. And that's what's going on here. So, you know, look, the only number that matters when Newsom or

or Mom Dhani or any of these other people talk about balancing budgets is the spending number. When the spending number is going like this, it doesn't matter what financial tricks you're doing. Now, that's no different. I'm not saying that Trump is any better or the federal government's any better. The federal government's actually worse. Two trillion plus deficits in peacetime in a good economy would be horrendous. So you can say, oh, it's because of war. Okay, one fourth of that is extra defense spending.

Where does the other $1.5 trillion come from? So everybody wants to spend money. Both political parties spend other people's money. That's what they do. The difference is, is now we're seeing this element of scapegoating happening. And when scapegoating, as in pointing at the rich, they're not paying their fair share. I mean, all I'll say is one statistic that's very simple. The United States has a significantly more progressive tax structure.

than Sweden. And so, yes, Sweden is a higher tax burden, but U.S., the rich pay a higher share is a percentage. And so that's all you really need to know. It's rhetoric versus reality. But the reason I pointed out is that rhetoric is extremely dangerous and extremely anti-business in many cases. And the only way through the situation is only one way out. Trump knows it, or at least his advisors know it. Warsh knows it. The only way out is through. You need to grow through it. it's very hard to grow through it with the regulatory structure that we have. Going backward. I mean, they made these wild predictions for the end of last year and Q1 of this year

and why don't be under shot? I mean, we're barely growing at all. That's right. And because we haven't changed the fundamental problems, right? The fundamental problems are regulation and then he threw the tariff stuff on top of it without supply chains. I mean, you can, you need to encourage the growth of supply chains long before you can afford to put in tariffs, particularly on goods that take years to develop the supply chains.

And we know that. We talked about this a year ago. Literally last year at this time, that's all we were yelling about. We were yelling about what was going on, you know, why Liberation Day was so stupid, why that he's going to have to go back, what deal will he cut, all this other stuff? But the truth is, the core problem is there's a lot of stuff we can't produce in this country. It takes seven months to 10 months to build a factory in China from the time they say, hmm, we should build a factory.

In America, it takes five years from the time we want to build a factory and says, okay, you can now start putting shovels in the ground. Until that changes, you're not getting the production that you want. Isn't that why this is so important? You know, Trump's visit to China? No. He has to visit every state capital. And he has to get people to listen to him in terms of cutting regulations.

Now, his agencies can cut regulations at the federal level. He doesn't necessarily need Congress to do it, although it's certainly helpful. But it's really a regulatory problem. The other piece of it is encouraging investment. And that's where they're going to try. I don't know that they will succeed because without the regulation changing, I don't know you can do it. But in order to encourage investment, what do you do? Do you make the cost of money more expensive?

Of course not. So you guys could talk about rate cuts as much as you want. They're not cutting rates. They're rate hikes. They're not hiking rates. It doesn't make any sense to do so. Because if you hike rates, you make it harder to invest, and that's all they need. That's the only thing they care about.

Right. So they'll sit on them, but that still doesn't help the long end, you know, with, it still doesn't help them. So what are they going to do? Of course, the only thing we can do on the long end is what you've said is they have to do. They have to buy it. I mean, what else can they do? And they have to scare the living crap out of the market that trying to shoot against them

will be very hazardous to their well. That's what they have to do. I mean, they don't have a choice. I mean, they can say they have a choice. They can wave their arms around and talk about it. But there is no choice. In order to encourage long-term investment, they've got to get control the wrong end of the curve.

There's no good way to do that short of, call it Operation Twist, call it whatever the hell you want to call it. Call it QE. I'm actually, I'm looking forward to hearing what they call it this time. I'm actually, this is going to be fun. I want to hear what's their explanation. is and what they call it because the actor's got to be it's going to be fun because they're going to make they're going to actually i think they're going to pick something that is just so ridiculous that it

it it's just teasing yeah that one it's great but it's an act but the fundamental point the fundamental point that mike makes every week and i agree with them 100% on i mean quite a few points I don't, but this what I do is everybody needs the stock market and the major asset markets to stay elevated. They have to. Because if they go in reverse, it's the carnage would be immense. You know, there's huge swaths of America that are living on the wealth effect, right? Huge swats. And it's like, what happens? That is the top of the K in the K-shaped economy, and it's literally driving the economy right now. But it's more important than that from a government it's driving tax receipts. Exactly. Because without capital gains and without the market going up,

the quote, rich, well, you know, they're not rich anymore. And your budget deficit goes from $2 trillion to $5 trillion pretty quickly. If you get a, even if it's not a recession in the classical sense of the word, if you get a flat GDP number with markets that drop 25, 30 percent, your budget it's going to explode. And what's that going to do to the long end? So you start asking yourself those questions. And so that's the other side of this. The other side of this is you say you cut rates and cut rates is bad because people say it's bad.

Well, but why is it bad? Well, you cut rates and you get more investment, asset prices go up. Does asset prices translate to consumer inflation? Well, historically, no, actually. the data, the correlation is of anything negative over the last 30 years to stock markets and above trend inflation and in real interest rates. It's just, the correlation doesn't exist. It exists.

The thing is, is that there's this myth that consumer demand is what's, is what's, is it, is pushing prices, is consumer pushing prices. But it's not true. It was true. I mean, even the Aurora Borealis coming back makes it, makes this decade similar to the 70s. It was true in the 70s, 100%. But we didn't have the wealth concentration that we had then. We didn't have a lot of things that we had then.

We didn't have the debt that we had that. Scott, bring up this chart that I just shared. This is New York Fed. They have released their first quarter. The New York Fed does a household debt and credit report, and this is on their report. This is troubling. Scott, do you say this?

Yeah, it wasn't. So you can see here, obviously nobody's paying their student loans. So the 90-day delinquency on student loans is above them. But this is the troubling one. So think of through it as a consumer. You're in the lower leg of that K-shaped economy, the wage earner that's not keeping up. Your credit card, you know, you've been spending on credit cards to keep because wages lag. You don't want to change your lifestyle.

or if you need to buy food and clothes or gas, you start putting on credit cards and they're revolving. And when you've got 28 to 29 percent or let's call it 25 to 29 percent interest rate on that, that means that $1,000 turns into $1,300 pretty quickly. So, but you're seeing the delinquencies go up in credit cards because what are you going to stop paying first? You're going to stop paying your credit cards first. And the first thing, when you can't pay, pay a bill you're going to stop paying your credit cards or your student loans and then come your auto loans but you're not going to stop paying on your mortgage because you don't want them to take your house so you know or home equity so those stay low and typically you know those are the the

home equity is not even it those loans aren't given out to to people with high credit risk so you know so you've got unless you've got massive amounts of equity in your house so you've got your your auto loans despite but this is the this is the this is the trouble one right here. The credit cards spiking up to 2010 levels, guys, this is great financial crisis level. Like this is, this is troubling to say the least. So, and that's, you know, and that's what, that's what we're watching. So to day's point, there's literally two economies going on in the United States right now. And the Fed fully understands us. They know that they've got to keep the economy going because if they crushed the asset owners and they crushed the, the market,

the stock market that this number will explore this this number this number and that all these numbers will explode higher meaning that the the stress on the system will will explode higher and they they they can't have that and that's the issue and so we have these valuations that are stretched to a point which don't make sense but it's it's like it's like you know where the water seeking its level like where does the money go? And the answer is, is, and Mike, I don't know if you're muted. I maybe you're in the middle of something, but the answer typically is, well, the money isn't real to begin with, you know, when you talk about valuations that are that insane. But if they're there now, and, you know, there's a lot of cash still out there just kind of sloshing

around. And that's the issue. The issue is, is, you know, do you buy Nvidia? I mean, I think the most important macro event in the stock market, barring some major announcement out of the Middle East either way, although I don't think that anything other than bad is possible at this point, at least in the next couple of weeks to a month, is SpaceX. There are three possibilities, and these three possibilities have huge impacts. Possibility in no particular order, possibility one, it comes off. They get evaluation similar to where it is now in the private markets, it sells off a little bit, but holds because a lot of these big tech IPOs pop and then revert and then kind of fall below and then eventually whatever happens. That kind of been not,

and nothing else, no other damage happens. Possibility two is the SpaceX IPOs and the money has to come from somewhere and the rest of the Mag 7 starts to revalue and that could be potentially a bubble meets pin scenario in Mag 7 valuations. And that's what a lot of people are worried about. I would imagine, I haven't looked, but I would imagine that there's some interesting volatility skews going on in June. Possibility three, which is getting more and more likely,

is they shelvered or postponed the IPO because of market conditions. Now, that would be an incredible signal that there's there's rocky roads ahead. I think they'll get public. I just think that the ones after them aren't going to be able to. So like my theory is kind of that SpaceX is all right, but but shows some cracks. But then if like Open AI or something tries to follow it.

Guys, the demand for these things are it, it's insane. The retail demand for these things. I've gotten multiple phone calls from people. How do I get into these things? How do I get into them? How do I get into them? Like it is, it's insane. The retail demand for these things.

things. So I just wonder, they're going to be exit liquidity from these clients. Yeah, they're going to be exit liquidity. It's just, it's just the reality. Well, retail always is. And that's one of the reasons why not, not to talk about the biggest problem in crypto is crypto went live to try to address, not address, but basically so that retail was leading. So they, they wouldn't be exiquid. They'd be the beginning liquidity. Of course, what happened, the VC's got involved in retail, became exit liquidity just faster. But the regulatory arbitrage between lack, no regulation, bring the thing to market with a white paper or a PowerPoint as opposed to an actual company or something real was a big problem. It still is. And it's up and down the crypto stack. You see it.

But the reason I point out SpaceX is it's a major liquidity event. It's a major, and liquidity, we've all learned, drives price. Right. And so we will see. But I do think, that it's a big deal. Now, you could make the argument, I don't think it's true, but you can make the argument, well, the liquidity is already there. Private companies already own it. It's just a shuffling of retail into the, you know, the various very rich people who own it. And maybe that's true. I know a lot of people who own it that are planning to sell it the second at IPOs. Of course they are. And they're up massively. So like, yeah, I get it. But I don't, yeah, it's not going to go well for it. It is another one of these rich, you know, transfer or transfer events.

from, I don't call it the poor to the rich, but we'll call it the poorer to the richer, and that's going to exacerbate a lot of the things that are going on. But it's also major liquidity. Mike, are you back? He's been here. Mike, you got a bunch of points he pulled there too. Do you want me to bring up your screen? Yeah, I've been here the whole time.

I just had discipline of muting myself, the lesson I've learned on our program. Oh, there we go. So I'm always there. But I want to point out the key theme is, just to put it. back a little bit. The price is creating the liquidity. This is the number one thing driving everything in the planet right now in no markets. It's the market cap, stock market cap to GDP in U.S. Now here I'm using S&B 500 divided by GDP, take off a few zeros. I can go back 100 years in that with a reliable day. But the thing is we're basically 2.5 times GDP. It is the economy.

James you mentioned that is the economy. And that's the big test I've been pointing out is I still think the key theme this year is going to be stock market volatility going up. It hasn't happened yet, you know, falling crude oil, falling gold stuff that's never happened before. We've had that kind of volatility. Been wrong. I still think U.S. Treasures would be the best place to go because we haven't had the test. In fact, we've had a test.

We're up 10% or so in S&P 500 and the total return and TLT is down like 3%. I mean, that's decent. If S&P 500 is down 10%, or if it does drop 10%, I think TLT will be up 20 to 30%. The key thing I'm showing out here is I just want to point out, this is all the matters. This is everything. This is everything. This is your quiddity. This is everything. And this is the fallacy of running it hot.

The Republicans are learning this. Running in hot means K-shaped economy means the people who voted for you, and you've almost guaranteed if you keep running it hot, the next president is going to be a Democrat. It's the way it works because of inflation. That's the number one issue, and they're getting hammered. So I want to point also, too,

the key thing is also what's happened this year, is the stock market got the cheapest versus, sorry, it got the most expensive, or Bloomberg commodity, and it's got the cheapest versus the stock market in about 25 years. And then the key thing is what's really pumping up right now is Crudell. So right now, we have an absolute worst case for long bonds.

We have crude oil spiking and stock market going up. We're not getting that wealth reversion. I want to point out just a few things that's going to happen. This is what's going to accelerate. This is the surplus or the surplus of supply versus demand in U.S. or the deficit of demand. This is N-Canon. It's approaching 8 million barrels of day.

There's no way for this to do anything but expand and go towards 10 if prices go up like we just did. So I would lean over to this December contract. I fully expect what Mr. Trump needs by the election. And it's going to get to, right now it's 82. It's going to get to 50. And I want to point out also a key theme I want to point out that's really triggered me to start getting bearish Bitcoin in 2024. This is what I show you here is a simple measure of the essence of crude oil divided by its 60-month moving average. You go back way in time.

We've got massive surging supply of crude oil in liquid fuels in the U.S. We've got massive surging supply of corn. I have to mention corn because they're talking E-15. We have a problem of demand. We need more surplus. more demand, which means more fuel. But the key thing I want to point out, if you just trigger back a little bit,

is the diminishing performance of crude oil versus its 60-month moving average. This is the same thing I pointed out of Bitcoin a little while ago. And now it's starting up up at the upper end of the range. Corn's the same thing. Corn's another third after natural gas source of fuel in this country.

And the key thing that's happening this year is, we've had the bounds. I fully expected to collapse. It's used the way it always does, and we're doing the same thing at Bitcoin. Again, it's starting to roll over. That's the bare market. Key thing I also want to point in commodities.

Yeah, they're up this year, but they're not up because of crude oil because of metals. The average, you know, crude oil is the same prices almost 20 years ago. The only single major sector in commodities that made a new high this year is precious metals, gold. And that's already peaked, I think, because volatility is too high. That's a key thing I would point out is this is what's where the year's going to end. And if we just get a normal backup in stock market, which is anathema, that's where I've been. thing kicks in, but that's a key thing I point out from a commodity standpoint is we absolutely have to have the stock market go up for almost most of the commodities, most of the metals. And the theme is

it's just a matter of time. I think crude oil goes back to its cost of production in the U.S., which is $55 of error. How long we stay up here is the more the U.S. supply is going to be made excessive, which is what you see there. So I have two overwhelming thoughts that kind of trickled through all of that. The first one is crude oil among commodities. is the only one, well, yeah, you're right. It's double as cost of production, and then if there wasn't a war, it probably would be right around there.

It would be somewhere between, somewhere with a profit margin, but not hugely, not huge. So 60 to 70 is probably the range that that Kruy would be if there wasn't a war. We kind of all know that, and you can see it by future contracts, et cetera. That's true. But the reason for that is technology

dramatically lower the cost of production. In actual constant dollar terms, crude oil has declined in its cost of production has gone down dramatically. The cost of producing gold, on the other hand, technology hasn't really improved it all that much. It's improved it because it always does. The cost of smelting silver hasn't really changed a whole lot. The cost of extracting and mining copper hasn't changed all that much. Technology hasn't improved those. So those commodities have a different price driver.

It's called dollars, and there's more of them. And so you would expect with more dollars, the price in dollars to be higher. And so you need to normalize charts based off of that when you start doing that. And that's true on every, it doesn't matter, you know, which thing you do. Technology, as Jeff Booth talks and everybody talks, is a deflationary force, but it's uneven. You can deflate certain things. You can't deflate others. It doesn't deflate an hour of person's time.

Well, it sort of does because of AI, you know, you can fire them. But there's a reason why when you pull up, I think, Scott, in one of your things, you had a chart of all the things, all the long-term inflation. You know, technology hasn't helped bring down the cost of raising a cow. And so beef prices are right at the top of that. If anything, regulations or whatnot have hurt that because of various climate rules and taxes and whatnot. Technology certainly hasn't brought down the cost of education because they don't use technology in schools to educate. people, they hire more administrators, right? But technology should bring down the cost of medical care, but the way our system works, it hasn't for a bunch of reasons, monopolies, et cetera. You can go up and

down the line, and you can look and see the cost of inflation is not even. It's uneven precisely because the impact of technology is what is diverse. And therefore, when you look at the price of things that are completely, you know, the same that you really aren't impacted by it, expect those prices to outperform the ones that technology is driving down the cost of production. That's probably the most important point there. Now, as far as Bitcoin is concerned, we're never going to agree on this. I think of Bitcoin as we all know as an option on its adoption. Its adoption is definitely higher.

The worst nomination is not priced in. People do not understand having the chair of the Federal Reserve, which is one of the most important regulators in the space that has been completely antithetical local Bitcoin in every way what that means. You know, is it rolling over? I mean, I don't know. You tell me, tell me where your stops are. I have been talking about a grinding rally with pauses for since 60,000.

And so it's 76,000 today. Okay, yeah, we were at 80, you know, and Sailor, of course, top pushed it like he did, like he just announced this morning, big deal. But, you know, we're, it's doing what it's doing. It's the same thing is the other thing that we talk that we disagree on is silver. I mean, silver is up today? Why is silver up today with everything down? Well, because silver's in a range.

I mean, its equilibrium point seems pretty clear consolidating in the 70 to 80 range. And it's now pushing toward the top of that again, but whatever. It had its blow off top, which was stupid. It came back down to this level, and it's been very stubborn here. And why is it stubbornness? Because there's still demand. Now, if the economy gets crushed, If the stock market gets crushed, silver, of course, Bitcoin, everything will go down with it.

Why? Because people won't be buying shit, nothing, you know, things could get pretty ugly, pretty fast. And that's really the question. So my flip side of what you say, because I think you're right, I think everything has been held up at the stock market. I mean, it's hard for me to believe that we won't see a 25 to 50% correction at some point in the rest of my life. And hopefully that the rest of my life isn't that short. I don't know when it will be, right? It's hard for me to believe that won't happen. We put ourselves in a situation where the economy is so much more vulnerable to that, what you would call normal reversion,

that it's hard to underestimate policymakers like the response. And honestly, I shrug my shoulders, I really don't know. And by the way, it's not just the story stocks. Actually, the story stocks will do better, right? People talk about like Tesla, how insanely high it's valued. but Tesla is building the first vertically integrated robotics company.

Well, the first vertically integrated anything company in a major industry tends to do well over time. So who knows what will be, where things will be? What do you say, Scott? They're just going to merge with SpaceX from the biggest company on the planet. Well, well, think about it. SpaceX is going to own, you know, 10 years from now, SpaceX is going to have this huge data, center footprint with nobody complaining about it using electricity from the grid because it's all going to be solar powered because it's going to be really close to the sun.

They're going to be doing all the calculations. They're going to be be beaming them by microwave's back to do all the autonomous driving and all the robots on Earth. I mean, you know, you think we're vulnerable to a solar storm now. I mean, just imagine what that's going to look like. But seriously, that's what he's building. I mean, it doesn't take a rocket scientist to figure out that what he's actually building is a vertically integrated robotics.

AI conglomerate with all facets. Anyway, I got way off the train tracks there. Sorry about that. It happens. There's one thing that I did want to talk about before I lose the time, which is this Iran announcement about Hormuz. I'm sure that you all saw it, but if you didn't, basically that they're going to be, or they've proposed charging largely in Bitcoin and tether basically 10% of a boat's value in insurance across the straits of Hormuz, but this is the first time that we've seen really like this technically laid out formally. I kind of have these mixed thoughts.

It's kind of the Bitcoin argument that we've had for sovereigns being proven, but not by who any Bitcoin would have wanted it. Well, let's ask you a question, just a really dumb one. Who would believe, I mean, insurance companies, when you buy insurance, you buy from, company because you know they can pay if something bad happens. Yeah, it's not really a insurance. I mean, this is, this is, this is sanctions light or blockade light, right? It's, it's a, it's a, it's a, it's a mafia insurance. This is, it's, well, let you have a, yeah, it's a, it's a, you know, it's a, it's a, it's a marketing

term, but called Hormu, I mean, it's literally called Hormuz safe. This is the Polly won't break both your legs insurance, right? Yeah, this is, this is not, yeah, nice ship you have there. It'd be a shame if something happened to it. Yeah. I mean, you know, the problem, the thing when I see these stories, the thing that bothered me the most is, is it gives ammo to Elizabeth Warren and her nonsense about Bitcoin. That's what it does. Because it's why they ask you for Bitcoin. Well, look, it doesn't matter. They're asking if there was such a thing as digital gold, they would ask for that.

But there isn't. You still have to trust that gold isn't a vault that's men with guns that could tell them to go F themselves. because, you know, if you held the digital claims, right? You know, the fact that they're saying tether is really funny because tether has been cozying up to the U.S., and I can't imagine the U.S. 300 million for the United States in operation, you know, economic fury or whatever it's called.

But we do know that Iran had over 500, 6 or 700 million, I think actually in tether held by the central bank. But that's kind of the story here, right? It's been largely done in tether, but when they say Bitcoin and Tether, one can be frozen and one really can't, right? So which do you think you're going to end up using? Well, it'll be Zcash. James, what do you think of this?

You're muted. Not the ZCachsh. I agree. It's just going to give Elizabeth Warren, her, you know, I guess her anti-in innovation army, the just just it's just going to give them firepower and the mainstream media I think it's I think it's you know I hate the term but nothing burger but I think it's I think it's but what if you know listen this is Iran saying we intend this will be a $10 billion you know windfall for Iran I mean do you think

anything of the signal of Iran saying you know your the way you can cross the straits is pay us in Bitcoin I mean it's not the use case I was looking for for from a sovereign but it's up let's back up there's two different there's the let's let's unpack that if you're if you're an oil tanker and you're going through the straight of or moose and you're paying a you know a hostile nation to not you know seize your your ship you're not hiding anything you're just okay well i guess we'll they just don't want they're they don't want you to pay them in dollars they're not going to you know they're not going to do it on the swift system so they've got to do it somewhere and so what what what the u.s will rail against what

warren will rail against is that she has no control over it it's not you know it's not like anyways hiding anything it's just that they don't have control over what you're doing that's the problem that's the and for bitcoiners that's actually pretty high signal that is like just a reminder the the government can't actually control each transaction just to let you know, you know, that this, it can live outside the U.S. grasp. And that's the signal that you'll hear her rail against. She'll do it in different ways, though.

She'll claim she'll go after it because, of course, she'll look at this and say, just like I said, it's for drug traffickers, it's for, you know, human traffickers, drug dealers and, you know, and hostile governments. Okay. You know, like, it just means that they can't control it. And that's the signal that you get out of that, in my opinion. Meanwhile, this feels more like Baghdad, Bob, like complete nonsense. I mean, we still have our warships and we're interdicting the strait.

So what are they going to pay Iran and Bitcoin and the U.S. destroyers and other military aircraft that are sitting there saying, pick one move and we sink you. No one's going to pay if it's not going to be successful. And we've already trumped that argument. I hate the back. The bad words that. No, it's intended. Yeah, Mike, what do you think?

It's as far as what I think in the straight is the key theme, I think, what needs to be pointed out from what you mentioned is it enhances to me the most significant trend in cryptos. And that is the proliferation of crypto dollars. And then the also the most significant trend right now is the purging of the excesses of price in crypto tokens. That's still in play. And that's why I still keep Bitcoin in my prudent short list, along with silver at higher levels. And, okay, so we bounced up to above 75. We still keep it because the only reason these things are going up is the stock market keys going up. Stock market goes down.

We plunge the whole space. Now, what's going to happen, I think, in the middle list is the key thing is we have completely failed to, and that's the key thing. I think what's happening psychologically and what's happening in the polls, people realize, don't care what you say, Mr. Trump. We failed. I go to a gas station. I'm paying $4.80. before this attack that you said we were going to succeed.

That was pain too, 80. So that's a failure. And to me, that's the key thing people are missing politically. And he might be finally getting it. But it also means, and one thing I also want to point out when Dave and I have disagreements is mostly because Dave points out the obvious known known fundamentals, which I get. And I always try to lead ahead to the technicals that signal, yeah, we get all those fundamentals. Think of all knowns.

But when markets, prices move, you have to shift those supply demand balances. Gold, silver, cryptos are still, those are bull markets. The latter is a bear market. I just respect the bear market. So I'll keep putting levels on it is, I think we're going to, and I'm going to present today at the metals conference in New York, Dave, we can hook up a little bit, is what usually happens in these environments when everybody switches off really bullish, which happened in crypto's last year, then you enter a period of very poor performance for a long time.

So for gold, we might make new high near 6,000, get everybody bullish, and they go back to 3500. for silver, maybe we get up to 100 again, and then go back to 50 or 30. That's just the way it's always worked. There's always reasons. And Dave always points out the obvious stuff. Some of us pointed out years ago when we're bulls is basically. That's the key thing to remember is being careful and knowing to be selling when they're yelling. That's still the case in cryptos, I think it's still their market. Metals is still peaked. Energy, I think, is just selling when they're yelling market. And the most significant one are the grains. I just see all these managed money to hedge funds way long in the grains for things that we say that this Trump's, they

The straits are going to stay closed. Crudol's going to stay high. And the lessons I learned is this is the time of you're supposed to sell these things. So I'm just pointed out as a forward-looking strategies. When the fundamentals shift one way and everybody's on board, this is what you're supposed to do. Yeah, there's a lot of what you say is true there, undeniably. Technicals sometimes lead fundamentals. Technicles also sometimes are just the madness of crowds.

And there are certain long-term trends that matter. I'm talking about normalizing the chart, though, is what I'm saying. That's the biggest difference here. Everything you just said about the grains, all of that I agree with. You know, you and I disagree on the metals because I think gold is reflecting people's starting initial beginning of loss of faith in the fiat system because of everything that James said when I was having internet troubles that I can hear, but I couldn't say anything and whatnot, which is this entire case that the Fed is trapped, that all the central banks in the world are trapped,

that we're just printing money because they have to to keep the, I'm not going to call it a Ponzi scheme because it's a terrible, it just doesn't, it's not a descriptive. It's a charade. Every fiat currency in thousands of years of history, every single freaking one of them has failed. And they don't fail overnight. They fail cause a lack of confidence.

For a while, when the Romans were clipping the edges of their coins, people accepted them. And then people started saying, wait a minute, I want this other coin because it has more. And it's like eventually it happens. These are slow motion train wrecks. And what I'm seeing in gold is the beginning, the inkling that maybe the slow motion train wreck is happening. It's not going to happen tomorrow. It's probably not going to happen next year. But every single time you get away.

Ask anybody from an economy that had hyperinflation. Ask somebody from Argentina or from Lebanon. But look at Argentina is fascinating. Yeah, Argentina. Venezuela, who's actually seen, sitting there and watching prices move

in the middle of their, of their dining experience on a chalkboard because the hyperinflation is so ramp. Just ask anybody how quickly you can lose confidence in a currency. And it does not mean that I expect that to happen in the U.S. anytime soon. But they're, there are waves of loss of confidence in these things. But it takes a lot of time.

Like Dave said, it's a slow. It's moving an ocean tanker, not a speedboat. Right. And so all it takes, if Peter's ship is out pounding the table on gold, and he convinces one pool of capital every month to put more money in gold, well, that demand shifts the supply demand curve. and that's why gold is still stubbornly over 4,500. You remember I said, I've been saying that I think, you know,

that equilibrium now is somewhere between 4,500 and 5,000. And, you know, that doesn't mean it can't go above it, doesn't mean it can't go below it, but we see it. But that thing is different. None of that applies to anything else, really, except for potentially Bitcoin. Silver is different. Silver is, we've been in structural deficit,

it for years and people have just been dealing with it, but they lost control of the market. It popped to this level. And the fact that it hasn't been able to go below these levels, remember, this is where the breakout start. The breakout started from 50, right up between 70 and 80 and a stadium in 780, and then it exploded and came back. And markets are finding its rhythm, but supply demand has not been normalized in any of these things. You know, the smelters are still running full out on that. So, yeah, I disagree with you there. But I totally agree with you on the stock market because the chart that you showed, the most important line on every chart that you've ever shown is the fact that the stock market GDP is at the highest level in its history.

You said you can go back hundreds of years. You can probably go back, I don't know, maybe when the Dutch East India company started in 1602 and the market valuation was higher as a percentage of GDP, I don't know. I mean, but you know, the Amsterdam Stock Exchange was the first one. Who the hell knows? Of course, it's curious. That's the tulip bulb thing. happened to the same place. But look, you know, markets go up and down, but that is extremely concerning the people. It is also recognizing a fact that capital is dramatically more important because of policy in the global economy than it's ever been before. That's just true. You know, we've been, we've had multiple people trying to push these things up for lots of reasons.

Doesn't mean they're going to succeed. I mean, I can remember in the end of the 80s, because I was back and forth to Japan a lot from 87 through 90, whatever. And I remember when Japan was flying high and everyone said, this is a new normal. And these valuations were okay. And the first bears, the first people saying the same stuff you're saying now, Mike, in Japan, we're screaming it in in 1988. Boy, did they get carried out because it kept going through 89. And then they started to be right. And the two things that happened during that bear market, it, which was brutal, I mean, absolutely brutal, was that I remember always. One, volatility was unbelievable, not just down, but up to up and down volatility, even though it was crashing. And the

second was the entire national psyche in support of the government trying to keep the market up. And all the things that they did during that time, I mean, you could go to the Tokyo Stockton, and literally on the day when it was up, people would be standing and clapping. And if it was down, they would be silent. I mean, stuff like that. It was all part of the national psyche. But it took a lot longer than people expected and was very involved along the way. And I'm not saying the same thing's going to happen here. I think there's a bunch of differences. But, you know, history doesn't repeat, but it does rhyme. And that's what you're calling for more or less, right? I don't want to put words to that. I've been carried out in markets a lot from those Mona League crystals late 2024,

but last year it kind of proved that it wasn't as dumb as I look. So let's just show a few charts. it's the time sometimes to be fundamental sometimes they use the discipline of what the market tells you and if you can show this i just show it gold versus it's 60 month moving average it just told you thank you very much this is great you're supposed to just say this is great we'll get out and we just did that and you have to go back to 1980 which silver same thing seriously silly stuff i mean this is like great fundamental stuff i get everybody gets it those are the people the retail buying and even p and peter shiff's probably going to get toasted and here's something one of my favorite charts i just put out last week on the same scale now this is actually

actual stock market cap to GDP. So I don't have to use that. S&B 500 because again, I can go back about 20 years on this one. And you've overlay this with just the gold volatility divided by S&P 500 volatility. This is this one of those singles that say it might not work this year, might not work next year. This is one of those things you're going to look back from the future and say, yeah, okay, thank you. Great for the, great for the warning. GMTFO, which is this. Hold on. This is a great. So that orange line, that's gold volatility divided by SPX. volatility? Is that what that is? 180 day.

Yeah. Right. So why is that? Well, that makes sense because the stock market is engineered, manipulated, supported, et cetera, by policy and gold kind of like they stop caring. They stop trying to manipulate it. They stop trying to push it. A lot of people in the gold world will tell you that gold was a beach ball being held

underwater. And the interesting thing is 180 days from now, let's see where it is, gold stays in this 4,500 to 5,000 range. But yeah, this isn't remotely surprising, but sometimes things make sense. Sometimes they don't. When they don't, that's when the chart really matters because the things that when, because it's saying this one at least you can understand. That's all I'm saying.

So I tilt over into my macro big picture. The leader on the way up, Bitcoin was only one in 2009 should be the leader on the way down. And that's why I stick with as my prudent short. So far, why is Gondchor not going to be the leader on the way down? There you go. Well, there I go for an index. We got a wrap. That's a great way to do it.

Yeah, Bloomberg Galaxy cryptocurrency. Sorry. I say, why isn't the stock market the leader for Bitcoin on the way up? That's the way I, you know, if it can keep making new highs. What happens if Bitcoin just trails the stock market here from, you know, the seven days? Watch the hot ball of money. It's moving around. I got a hour already.

How'd that happen? Yeah, I know. Good to have the whole team back. Hopefully we'll continue doing that. I know it's the summer. A lot of people will be away. But James, we needed you, man. I needed you.

The glue. The glue is back. The glue is back. All right, everybody. I'll see you on the Daily Wolf today at noon. Dave, are you doing a Crypto Town Hall? Why not? Hey, Mike.

What conference you at? Because I actually do, I am fairly free today until like 6 o'clock. So you guys have something. We'll touch after a show. I'll definitely hook up with you. Awesome. You can't do it where you live in Miami, but both of you get to.

New York and you're going to have that stick. All right, I wish I was there. All right, fellas, have a good one. We'll see you guys later tomorrow. Bye.