The Wolf Of All Streets - Bitcoin Holds $86K While The Dollar Hits An 18-Month High | Michael Howell

Episode Date: October 5, 2026

Bitcoin holds strong near $86K despite the dollar hitting an 18-month high and Treasury yields continuing to climb. Meanwhile, global liquidity is surging, OKX and NYSE owner ICE are pushing for 24/7 tokenized stock trading, and China is undergoing a massive consolidation of its banking system. Learn more about your ad choices. Visit megaphone.fm/adchoices

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Discover coffee plus on nispresso.com. Bitcoin continues to hold strong around 86,000, while the dollar hits an 18-month high. Also, we're obviously going to talk about the PCE numbers and the job numbers that came in last week, unexpectedly soft, giving the Fed a bit of cover to maybe cut and stop the hiking cycle. What a coincidence. Magic, honestly. We've got a very special guest with Mike Dave, and I'd say we've got Michael Howell. We're going to dive into all of it right here.

I'm Macromon. Let's go. Good morning, everybody. Happy Macro Monday. I'm going to go ahead and bring on the crew today. We've got Mike, Michael Hal, and Dave, Michael. Welcome for your first time here on the show. Glad to have you. Well, right, police will be in. Looking forward to it. Okay, so Mike, we're going to start with the Bloomberg morning meeting, but from New York offices instead of Miami offices today. Yes, we have the Greenwich Economic Forum starting tonight, so I'm here for that. I'm honored to be part of that. I'm moderating the crypto panel. That'll be interesting.

Last year was a commodity panel. I forgot to get Chuck out of Dave on that one. But so for the morning meeting, Andrew Sacher, a senior economist, point out of the big repricing started last week with Fed President Williamson. We probably need some patience, downward revisions in PCE, deflation, and soft payrolls. This week's about the FMC minutes, which come out Wednesday. And the key questions, were they leaning forward further tightening? some of the data kind of came back a little bit. Obviously, we've taken the tightening out of the October meeting. Right now, they expect one more hike from the committee this year, which is not going to be in October before the election.

And it's going to be good to see how much they might have had a higher rate view before the day that came out and really took a lot of the hiking out of Martin. Will Hoffman on rates, I kind of pointed out, it was kind of perplexed by the abrupt reversal in U.S. rates last week, still rising, but it's global. U.S. on an FX hedge basis is near amongst the lowest yielding among the G10, or G7 countries. Decent supply this week, but last week is a little bit messy, although 10 and 30-year durations are doing well, and he does expect the Fed and the Treasury potentially do some more long-end buybacks and actually maybe cut supply in the longer end.

Audrey Chil Freeman, our FX strategy, point out the euros in the limelight, mostly because partly French bond pressure, but expects that to continue, expect in the euro maybe to head towards that one key, 110 level, psychological level. But her point was the headlines in the direction of what's happening in France, it may be best to be defensive in FX means short the euro. Chris Gain pointed out his key. He's our equity strategy. He pointed out the weird stuff that's happening in equities,

a record amount of negative beta stocks. Now, Chris is very much technical and factor-oriented. About 29% now it's the highest in year. There's record low pairwise correlations and things like that. He said 99% of outperformance from market camp versus Equate in the past few months like to see him winding out of the rally. He says he doesn't really know how much bear this is, but a lot of weird stuff kicking in. And I in my outlook pointed I think we're nearing peak energy crisis.

I just pointed out a few facts like he did. We've had the greatest rally in the Bloomberg diesel total return index on a 12-month basis in history, not only goes back 30 years, but it was 170%, typically that kicks in low-price cures. And I just pointed out how metals and cryptos in the same kind of space are completely stock puppets. And then the key theme there is don't fight the Fed. Back to you. Let's talk about don't fight the Fed. It's a great, great segue to what we should discuss next, because, I mean, I can show you Kalshi, I just happened to bring it up. But we had, you know, Fed decision in October. Obviously, Until a week ago, everybody thought they were going to hike again.

You can see here. And now it's, I believe, an 82% chance that the Fed maintains rates, according to prediction markets. Of course, that is because the Fed's favorite inflation gauge, PCE, came in magically. I'm using the term magically because I'm literally at the point where I've never been a conspiracy theorist in my life. I just don't believe any of the numbers. But PCE came in soft after they recalculated how they do PCE, and job numbers came in extremely

soft and they revised back as usual the previous few months to make the job market obviously looks extremely weak. So now the Fed apparently is unlikely to continue hiking. Michael, I want to ask you this. Doesn't the Fed have data that they're looking at in real time? Why would they hike just a few weeks ago if this is what the job numbers in PCE were likely to come in as? Well, I think part of it is that the Fed is the slave to the markets and the markets are pushing them in this direction. The economy is red-hot. Bon markets are telling us that rates should be higher, and the Fed is pretty much responding to that message. I think that there's a lot of narrative out there that says the bond yields arising because of debt concerns, because of disillusionable

with a dollar, but that's plainly rubbish. I mean, that clearly is not going on. What it is, is plain and simply, is the economy is red-hot, and the bond market is responding to that, and the Federal Reserve is basically following the bond market. And that's pretty much what always happens. I wouldn't read too much into the fact that rates are going up or whatever, because I don't think Fed funds rate means the same as it used to. You're in a world where the federal government is in hoax of the private sector. So in other words, if they start to raise Fed funds,

given particularly the amount of bill funding that's out there, it's a big income transfer to the private sector. That's a boost to incomes. That's a boost to economic growth. There's a lot of head scratching about what a Fed Funds rate change really means. I'm baffled. I'm not sure whether it's a tightening or a loosening. I think a lot of people are in the same boat.

So I think we're going to start looking at some of the other dynamics. And what I would say is we're living in a collateral-based world. So the sort of metrics that we've got to watch now are things like the move index on volatility. and actually the integrity of the pool of collateral that's behind lending. And you've got to remember that this is a World Bank figure. So, you know, they've done the calculation. 80% of all lending worldwide now is collateral based. That is a whopping great change, you know, over the last 10, 15 years.

Dave, there's got to be some threads you want to pull there. I saw you. Yeah, I mean, I look at two things. First, this report, the dichotomy between the payroll, numbers and the household survey backs up what Michael was saying, right? You know, the household survey shows an increase in labor force participation, etc. Average hourly earnings up a bit. You know, it's, when you look at all this stuff, I mean, I don't trust the BLS numbers at all because for any, in fact, no sane person does because we know that there's going to be revisions,

etc. But what is very relevant is in Michael phrased it is the Fed is in the U.S. government is in Hock. All of the G7 now are is in Hock. You know, the Germany used to be the outlier. Now they're, they're starting to run deficits for defense, et cetera. But the truth is that we're in a situation with fiscal dominance. And there's no choice but to monetize this debt because it's the only way they can pay it. And as I said, you know, when they raise rates, every 25, basis points is at this point north of $100 billion in annual extra interest expense. That's not trivial. That is not a trivial number. I mean, you know, it's like it, you have to look at it that way. And so they are sitting in a situation where the market is, the bond market is leading. And to quote

Mr. McGlone, the Fed is a sock puppet. They have no choice but to go along with them. And if they didn't, their fear is, like, for example, I think the only reason it was unanimous was because they felt they had no choice, and if they weren't unanimous, that they would lose the long end entirely. Now, I don't know if that's true. I think 25 basis points here, there shouldn't matter, but that's what's going on. But I think the most important question is something that, you know, I wanted to pull on what Michael has been writing, which is, you know, on the global liquidity cycle, which has been stubbornly stronger than forecast, but I think it's stubbornly stronger than forecast because we're running north of two trillion dollar deficits in the United States, and they have to monetize it. And China

has been monetizing all along. And so I don't see how that changes anytime soon. If anything, it feels like it's accelerating. And the political situation in the U.S. is such that both sides are trying to bribe the populace, which gives you literally no hope of reining this in anytime soon. So I'm curious what, you know, what you don't even, I mean, they don't even pretend, right? No, there's no pretense. Yeah, I mean, Bessent, you know, Bessent a year ago, we're going to, you know, 40 trillion is too high of a number. We're going to work aggressively to cut the debt.

Bessent a month ago. 40 trillion is just a number. We could grow our way past that. No big deal. But you're right. Before, before Michael, talks, I want to mention one of the thing that I think is hysterical, right? So Trump came out last week and made some comment that the only way to pay back to debt is He didn't say only, but the way to pay back the debt is through inflation.

And that may be the ultimate saying the quiet part out loud. My guess is that he was told that in briefings and wasn't supposed to say it, but did anyway. I don't think we have quiet parts anymore. Yeah, I mean, but look, whether it was James Lavish or I or any one of a number of guests on the show, we've made the point that there is no way to pay back the massive G7 government debt without inflation. There just isn't. We all kind of know that, but the government has pretended and pretended and pretended for so long that it's actually hysterical to me that now that you have the president kind of saying it out loud and people are kind of reacting to it. You know, Bitcoin caught a bid when that happened. Gold, you know, sort of caught a small bid when that happened. But it's actually kind of important because it's not what the general population thinks. Anyway, I've talked for a long time, Michael. I don't know if you, you know, what your thoughts are, but I would love to hear what you.

you think about the global liquidity cycle because of fiscal dominance. That's expanding. Well, I think I think that what you've got is monetization across the G7. I mean, that's pretty clear what's going on, at least to, you know, those of us who actually look at monetary data. And you can see it buried in the fact that in the US and the US has led here, we're doing a lot of bill financing. Now, the question you've got to ask is, if they start issuing a lot of bills, who buys the bills? And the question is, all the question is, all the is, or the answer is, it's the banks. Now, banks by government debt, that's monetization.

And plain and simple. And so what you've got is a trend towards higher monetization. That may be a sort of wonkish interpretation. It's something the majority of people don't understand, but it's a fact. There is monetization going on already, okay, and, you know, a lot of people attribute, and I'll come back to this point, a lot of people attribute the rising gold to monetization. My point is that's not true. It's not G7 monetization that's forced the gold price up is China. The real monetization in the West hasn't started yet. Politicians are going to kick the can down the road, as they have done for the last 120 years or so. It doesn't mean to say you're going to get a financial crisis.

You're just going to get a permanent or progressive devaluation of paper money. And that's what's going on. That's why you've got our own things like cryptocurrencies and gold as some sort of monetary inflation hedge. And I also disagree with the point that people say that this is financial repression. It ain't financial repression. It's monetary inflation. financial repression destroys your income, monetary inflation destroys your wealth. And that's far more important for the majority of people. And so you've got to take these monetary inflation hedges. Now, I made the point that just now that China is responsible for gold, the gold inflation. China is pricing the gold bullion market at the margin. They're the important

buyers. The PBOC is doing that, the people's bank, but also Chinese retailer doing that. Now, the reason is that China is suffering debt deflation. When you look at the data on China, this economy is slow. They're seeing falling prices, the wholly dependent on fiscal spending or an export growth to get any sort of juice into the economy. Classic debt deflation is what Japan saw. Now, how did Japan dig its way out of that? It devalued the yen. It printed money. He got the BOJ to buy JGB's Japanese government bets with alacrity. And what do you see is Japan has now climbed out of its debt problem. China has to do exactly the same thing. So China doesn't have to revalue the yuan.

It has to actually devalue the yuan. And that's the scary thought. So this is the outlook that I would envision. And what that means is monetization en masse around the world. Politicians everywhere, east and west, are going to kick the can down the road. That's why you need monetary inflation hedges. I mean, I like Mike to be able to comment, but I do want to pull on a couple of threads there. So specifically, you know, Japan climbing out of its debt problem with their JGBs, I mean, I think a lot of people in the world are of a lot more concern about Japan's ability and what happens with rising long end and, in fact, the short end there too.

But basically, the interest rates in Japan and what does that mean? Obviously, we have the carry trade, you know, there's a lot of other things there. But I don't think I've ever heard anybody use the words Japan is climbing its way out of its debt problem. A lot of people think it's more manifesting. So I'm really interested in that. Well, I think the point is, is it just look at the growth rate of the Japanese economy. The Japanese economy, what, let's say, five to ten years ago was basically flattened its back. It wasn't growing at all.

Now you're looking at NGDP growth, nominal GDP, which is around the level of sort of four to five percent. Japan may have an inflation problem, but that's actually eroding the debt to, you know, the Japanese government debt progressively. And that, as you echoed, is what Trump is pretty much saying, you know, he can't keep a secret. And he's, you know, telling everybody this is what's going to happen. Mike. I think we should express caution when everybody says the same thing after something that's happened and prices have gone up a lot. Markets usually make peaks and euphoria. And the debt, the GDP scenario is things that really got me, bullish Bitcoin, almost a

decade ago a little bit less and really jumped off even the horse of gold, partly because you get to levels that historically say, yeah, great, we all get it, we all say the same thing, and markets have already priced it in. So, for instance, one lesson of history when gold gets exciting, it's best for investors to be cautious. Right now, on a 260-day basis, gold's volatility versus S&P 500 is 2.2 times. That's a high since 2007. That's a big headwind. Also, at the same time, people keep focusing on the asset or the liability without measuring the asset. Sure, 40,000, billion dollars a problem in this country. But you look at the asset, $82 trillion, just simple real-time measure of U.S. stock market cap. That's the highest in 25 years, just like Bono. So I look

at this is when people all say the same thing after we've gone up, typically it's an end game. And I still look at it as an endgame. Right now, you're fighting the Fed. If you're buying any type of risk asset that has a high correlation, certainly with S&B 500, but any risk asset is a high correlation with S&B 500 and a higher volatility, which includes Bitcoin and gold, you're taking more risk than you should be. And after we've had a risk, certainly, but after we've had major pumps and we're in dumps. So right now we've had pumps and dumps this year and Bitcoin, gold, silver, platinum, pladium, iron ore, copper's next on that list. Here's a fact. Copper's 50-day correlation with the S&P 500 is about 0.64. That's the highest in the history

of that futures contract trading in the U.S. Why is that important? Because of one human being Mr. Trump. So I think anything you're looking at right now for that type of scenarios, you have to be looking over if you're buying any type of asset. Most notably broad cryptos, if it's not just Bitcoin. Most of the broad metals, including gold, you have to be looking over that S&P 500 and say, yeah, thanks. As long as you go up, I'll make money. Just the facts of any value at risk model right now says they're all going down if the stock market goes down. And the bottom line, remember, to help solve this problem of the monetizing debt, some of the best places of being.

It's been broad stock markets. Now, we've learned that lesson in the history of the Limerian Republic and stuff. But I just point out in things that I've been bullish in the past, most notably gold last year, trades over. Yeah, well, I mean, well said, I think we've got to we've got to differentiate. the cycle from the trend, and I was referring to the trend, but we've got to be, you know, cognizant of the fact there's a cycle out there. And in a cycle, the cycles are pretty, you know, pretty ruthless. They will destroy trends temporarily. But I think the point I'm making to be more explicit is that, you know, if you get a sell-off in gold, which is entirely possible, or in

crypto, entirely possible if the Fed sticks to, you know, what we think it may be doing, is it a selling or is a buying opportunity. And I think the fact is if you get dips in these assets, it's worth adding to them, not piling out. Because what we know is that on the other side, there's going to be monetization, because that has to be. They've got no choice. I mean, I think that the important point here is a question of where you base things.

So like gold, for example, let's just take a step back and look, right? Gold went from, you know, what, 3,000 or so. It was trading between 2,000 and 3,000. it rallied all the way to 5,500. Now we sit with a class, and then it did a classic 50% of the move retracement, literally, and that's exactly where, you know, where we sit a little bit above that now at 4,100,

but it's more or less. I mean, you do the math. I mean, it's a little bit more than 50% from depending on where you start the rally. I mean, this does not feel like we're overheated. This is the sort of thing where, yeah, maybe it got ahead of itself. In fact, we don't, we kept talking about it. One of the things, Michael, that I pointed,

out when gold was rallying was that there was this hot ball of money. People don't understand this, but one of the largest markets in the world is called Contract for Differences. It came out of the old FX world, right, where you could trade on 100x leverage on FX. And banks, not banks, but companies started offering this to retail and institutional gamblers or speculators, whatever you want to call them, professional. They call them hedge funds. I don't really care. They're all the same to me. The fact is, is that I was talking with right at the peak of gold, I was talking with a gentleman who ran one of the largest market makers division, which handled this. And he was telling me just how incredibly large the money flows were. And so to me, that was a red flag, and I knew

there'd be a correction, and there was. And the correction, as normal, went farther than I would have expected being more than 50%. So when we talk about, you know, what's the actual fair price of gold? I mean, who the hell knows? I mean, gold, by my calculation, at its peak probably hit 85. Now it's probably 75 percent of its value is, quote, monetary value as opposed to jewelry and industrial value. And I get that by comparing gold to platinum, given platinum is significantly rarer, you know, more, you know, even today, it's considered if you ask someone, what's the platinum standard or the gold standard, you know, in any conference or anything, they still value platinum more despite being gold being roughly twice the price. So you start looking at these things. And I don't know what fair value for gold is. What I do

know is, when we talk about Bitcoin, is that most of the people who are buying Bitcoin the smart money look at it as an option on its ability to actually eat into or surpass gold's monetary pure monetary value. And that number is dramatically higher than where we are today. And so there, very different pictures. In the case of gold, it's going to follow monetary inflation, full stop. It will do so with peaks and valleys and lots of speculation. So it will get ahead of itself, it'll get under itself. It will do that. That is what it's doing unless a regime change happens. Unless China and other central banks stop buying it as their inflation hedge, it's going to continue to do that. And I think it's probably under its trend right now. And so I would be inclined to be

longer. Mike disagrees. He thinks it's going to go back toward 3,000. But that's where a large part of this is. And the Bitcoin question is different. It's will it actually continue to grow and succeed? That's sort of how we have framed the argument. I mean, Mike will doubt, you know, you should give your side of it. But that's sort of the way that I was looking at it. I'm curious what you think, though. Yeah. I mean, I think both assets are good monetary inflation hedges. The fact is that if you look at crypto stroke Bitcoin, they're the most liquidity sensitive assets on the planet. They move, you know, many times, many fold more for every liquidity impulse compared to gold. So you don't even very much in a portfolio to give you a monetary inflation hedge.

But I mean, my view is that you've got, what, 3,000, 4,000 years of history behind gold. You've got 15 years or so behind Bitcoin. And therefore, I've got to be more confident that gold in the long term is going to maintain the properties of monetary inflation hedging. Bitcoin certainly has done it in the last 15 years, and I hope it succeeds. But I think you need both in your portfolio mixing them by their relative volatility. So it means having a lot more gold than Bitcoin, but both are good, I think. Well, right now we have a sort of Goldilocks moment for Bitcoin, where it seemingly should be going down by most analysts, you know, opinions, and it hasn't been, right? Bitcoin resilience

tested as US dollar climbs to 18-month high. Here's the DXY right now. I mean, it's a It's exactly almost mirrors the Bitcoin chart, which has been rising for five or six weeks, you know, steadily after the huge move that it had at the end of August. And the dollar is also rising. That's supposed to be inversely correlated, right? We're supposed to see the dollar strength mean that risk assets sell off. Bitcoin not really trading like a risk asset. As we showed you on the gold chart before, gold is now below its 50 week moving average and dropping.

Bitcoin now, which is not here on this chart, is above its 50 week average. moving average and rising. So Bitcoin has not, you know, Mike, we talk about the correlations endlessly, but Bitcoin has not traded like it should or in a correlated fashion to the assets that people historically expected to over the past six weeks. It just has not. Six weeks, great. I do enjoy when Dave calls smart money, people invests in Bitcoin. If they're smart, they're poorly invested in and making poor performance, poor relative performs because you just look Bitcoin versus the NASDAQ. It's the same level as first touch in 2017. It's the same level as the 2021. And over that time, it's traded three times of volatility.

Now, that's just a fact. But I've heard that from prominent money managers at Economic Club events in Miami. They look over at Bitcoin and say, yeah, great. I do much better risk adjusted than NASDAQ. Why would I touch this highly expected digital asset that has in a space within a space of unlimited supply? And I like to bring that out because I started calling Bitcoin amongst a bunch of pigeons last year. At least precious metals are a bunch of dubs. There's only four of them, gold, silver, platinum, and they've reached too high. So I'm glad how you mentioned platinum. Dave, the high in platinum was in 2008, was 2000 and 2002, basically $2,200 an ounce. Right now we're $1, that's a horrible investment. And I was part of it for a long time. And just some of us got lucky to

sell in Q1, stuff we held for decades. But this is, my point is now we have to be careful. with how the answers have changed. The answers do change, and that is, since when are central banks the best indicators of what and where to buy? I mean, we know things like Gordon Brown and everything, but the analogy I use for being really bullish gold when it was below 2000, yeah, central banks are buying. But now you have the price of gold, you look at versus a bond index. We have a bond index, treasury bond index in the U.S. going back to 1973, and that price of gold

versus that bond next is the highest in 40 years since 1986. And I just look at it, okay, this whole space is great, but the whole thing now is all stock puppets. And then I also point out, then just like the U.S. stock market cap to public debt, the highest in 25 years. Forget about GDP, all that stuff. And then you look at the examples of when people say what's happening in Japan. Well, they have 300% stock market, I'm sorry, public debt to GDP, and their bond yields are in two handles. So it's similar in Japan. They're coming out of it.

So I look at it this way, is let's be careful calling smart money. and look at the facts. And that's why I like to point out the facts of poor performance. It says higher volatility, same performance. My rules of portfolio management and risk management is that's a dud. And I can see show six months. The last six months have been great. It's a nice to see that bounce.

But we have not seen the test. That's what I want to see. Let me just see the quote from Mr. from head of Vanguard, Robert Mr. Bogle, Jack Bogle, but if you can't handle a 20, if you can't imagine a 20, percent correction the stock market shouldn't be in stock so i can't even imagine a 10 percent correction because that would be 25 percent of GDP i fully expect everything my space no slowly copper industrial metals to drop if if s mbs drop 10 percent to drop 20 percent i fully expect

all cryptos to drop 20 but i'd like to see that test so i can flip over and get out of this mantra of think we're all stock puppets and right now we are giving me a test so we can see who's wearing clothes right now at oh by the way it's october i mean being october i just remember running peas and ls this where I had my most extremes. Winning and lose in October, which is how that works out. I think it's five days from now crypto's put in their peak last year. But, I mean, as I showed, I mean, I know I agree with you

that long correlation should be determined over the long term, but Bitcoin has been wildly outperforming at a time when it shouldn't have been. And yes, that's not the 10% stock market drop, but we have gotten 10% stock market drops over the past few years. It hasn't been devastating, right? And when's the last one we had that really, that's my point. We'd see the test.

We just haven't seen one lately as we head towards October. I'd like to see a test because I can flip my views. And I agree with you. But let's be careful. One year, two years, basis, it coins a dog, certainly versus gold and S&P 500. Sure, it bounced from an oversaw levels that you guys nailed. Certainly you did, Dave, and you did Scott. It's bounced from that oversaw levels, key support run 60.

But here we are. Let's see how this work. Maybe this month will tell the test. And also then we have midterms coming up. people associate a current president with inflation and Bitcoin. Before we go down the Bitcoin rabbit hole, Dave, because I know that once we go, we will fall endlessly and not talk about anything else. I do want to talk about this because Bessent backs off bond market bravado saying the House

doesn't always win. I don't know if you all saw it, but this circles back to sort of the power of the bond market calling, I think, the Fed and the Treasury's bluff right now. But you'll remember that he made the comment that I'm the House. Good luck betting against me. Right? he talked about that with Japan and the bond market in general. Now, to be clear, his actual quote here was the house doesn't win every hand. The house plays the percentages. So it's being a bit overreported

as the house. But he has said now that he can't control the bond market. He's clearly said that. He made the quote, I can't control the bond market. And I think that he gave the impression about eight weeks ago that he could. Right. That's actually when Bitcoin skyrocketed, was when Bessent announced the intervention, albeit small, it was the signal that they were going to intervene. And there was some level of pain that they were not willing to endure. But, yeah, Michael, I would love your take on this because we had Bessent obviously say we're going to, you know, inject some liquidity or increase the bond buybacks. Nothing that either the Treasury or the Fed has done has stopped the bond market from calling their bluff. Is there anything that they can do?

I know you spoke to this a bit earlier now do we just, you know, in your estimation, buy gold and Bitcoin and call it a day. Well, I think the point is to come back to why the bond market in the U.S. And let me just draw that distinction because there are other markets where you are getting, you know, negative effects from too much debt. And I think Japan is one of those. France is clearly another. But I think in the case of the U.S. is pretty clear that it's a strong economy. And it's not really the debt outlook that's really affecting the bond market yet. That may be to come, but it's not right now.

Turned premier in the US have been either flat or falling, which is a pretty good indication that debt is not really a worry to investors. It's a strong economy that is, and it's basically rate expectations that are really pushing yields higher. Now, that in a way is self-curing because the more that yields rise, the more that is going to weigh on the economy, and you're likely to see some sort of adjustment. And I think that, you know, from that standpoint,

and I think Mike makes a good point that, you know, we are in a cycle, you've got to remember that. From where we stand right now, I would say, in a 12-month few bond markets look pretty attractive to me, particularly the tips market. So I think you could be getting some not bad gains. I'd much rather be there than in stocks, but as I say, go back to the golden Bitcoin point. I think those are long-term asset holds in a portfolio. And if they do come down, which they're likely to it, if the monetary environment gets squeezed more, it's a buying opportunity and not a selling opportunity. But I think you've got to start to think about, you know, what's going on in a world where collateral is very important.

And two of the key indicators of, let's say, deteriorating collateral is the rise in bond volatility through the move index, which to my mind is way, way more important than the Fed funds rate, because that determines the collateral multiplier and basically the whole credit system. And the other thing is basically what the Fed itself is doing in terms of money markets and allocating liquidity into the repo markets. And at the moment, that's pretty quiescent. That's not a problem, but we saw basically many episodes in the last two years that that could blow up as well. But I think the problem is, in the backdrop, is you suddenly see this progressive tightening through the collateral markets, through the rising US dollar. And, you know, what Scott Besson

is trying to do is to manage volatility as best he can. You know, a lot of the media have been way often what I'm trying to do, suggesting that, you know, six billion of buybacks is going to try and suppress yields. I mean, that's his bonkers. I mean, Besson's a clever guy. He's not that foolish. What he's trying to do is to dampen volatility. And that's the name of the game. If you dampen volatility, you're going to encourage more of the basis trade, which is going to help to depress yields generally. But it's not, you know, he's not trying to buy back to push yields down directly. That's for sure. He's trying to encourage the market to short the future and buy and just play the carry trade.

effectively. Keep volatility low. That's what you've got to do. Treasure market's all important. Yeah, the most interesting part of all of this is how strong the dollar has been. And that is a direct result, and what you're saying, and I think you're right, of U.S. economic growth. And that matters because normally when the dollar rallies, that's bad for, you know, gold, Bitcoin, et cetera, right? You know, typically, if you go to historical relationships, Although in this particular case, I don't think it's terribly, I think it's coincidental. I don't know that there's anything causal that goes on there. But, you know, people in the U.S., we have this conceit where we always look at everything.

You know, everything is in U.S. dollar terms, right, Fiat, Fiat, except for the fact that the dollar rising kind of tells people that this isn't the U.S. dollar falling apart. I mean, if you sit in Bitcoin chat rooms, and I'll be really curious what your panel's going to be like, Mike, you know, you get a lot of people talking about, well, obviously the dollar's debasic. etc, except for the rest of the world's paper is debasing even more. And that's extremely important, I think. Yeah, I think you start to look at Europe. I mean, it's a complete mess. You know, the euro is a fragile institution. And you've got a situation where the euro system has no safe asset.

I mean, this is crazy. I mean, whoever designed this was, you know, mad. The only safe asset in the euro. euro area is the German Bund. So as soon as you get a crisis, everybody piles into German buns. You get spreads blowing out between oats, Italian bonds and German buns. And what the ECB is committed to do is whatever it takes, which means basically printing money. So whenever there's a crisis, euro supply implicitly goes up massively, it devalues more against the dollar. And then Japan, we've got pretty much the same situation where the prime minister is basically saying there,

there's going to be no austerity, full speed ahead with monetization. So the Japanese yen doesn't look to me that solid. So there's no every reason why the dollar's going up. And, you know, the plain fact, as Dave says, is that all money that's anywhere must be somewhere. So if you've got a strong economy, it's not in financial markets. And it's not, it's not, it's, you're creating a scarcity of dollars. And that's simply what's going on. I mean, I look at Europe and I find it, you know, the bond markets are just just fascinating, right? You know, France has, having their 10-year yield being above Italy, you know, unless I'm missing the fiscal situation, that seems a reaction to the newspaper, Artawell newspaper. The videos we keep seeing on TikTok

of all the protests in France are probably a large part of that. But, you know, the spread between that and Germany is blowing out. I mean, you know, over the, not by a small amount. I mean, it looks like, you know, 60 basis points over the, you know, this year. You know, that's a pretty big move, you know. who's going to pay off France out? I mean, this is the question. They've got a rising debt GDP ratio. All these protests, and you've got to remember the presidential elections next year, so there's not going to be any great cutback in spending.

I mean, that's for sure. So, you know, at the end of the day, France is going to accumulate more and more debt. The economy is going to look more and more fragile. The Germans ultimately are going to have to pay it out. But at some stage, they're going to blink. If they come to their senses, they will pretty shortly. But the impact. implication of a bailout is more liquidity, right?

Exactly. I don't see any other alternative. Whatever it takes, that's the line. That's the draggy line, whatever it takes. I mean, is there any truth that you're sitting in Oxford right now? I mean, you know, the UK yields are higher than, or 50, actually more, 60 basis points, more than even France. You know, I was reading over the weekend, someone talking about, you know, Brent, whatever.

Anyway, you know, the UK, you know, the UK trying. to rejoin the Eurozone because get them part of that German bailout possibly. I don't know. I'm just curious, you know, is there any possibility of that or is the UK basically just on the sad train to nowhere when it comes to financial, you know, the financial situation? I think you've nailed it, Dave. I think it's on the sad trend of nowhere. I think there's no way out. I mean, they've got socialist policies. They've got no interest and austerity. That's what's needed. You know, UK guilt yields are actually high and they're probably from a short-term perspective quite attractive of these levels. But notwithstanding the fact the longer-term outlook is not great, they're going

to have to monetise as well. It's very interesting that all these central banks or governments are now talking exactly the same story as Scott Bessner saying, we're going to do a lot more bill issuance. Why they're doing bill issuance because it's easy. Banks buy that stuff with alacrity, but that's monetization. And that's what these long-term monetary inflation hedges are going to get their juice from. This is a very different world. I mean, people don't realize how much the world has changed. The only thing they can do, these guys can do is kick the can down the road. And you look at the response to every crisis since 2008, they printed money. They haven't thought about reducing deficits. No one is. You can't do it in this sort of fragile geopolitical world. And you know,

I wrote a book a few years ago called Capital War. It was basically all about the idea that you're in competition. America and China are loggerheads in competition. No one's going to force a recession. No one's going to cut back fiscally in this world. They're going to keep on going on, plowing more money into the system. And that's exactly what's going on. And I could, you know, I describe what's going on in the US. It's not Fed QE. It's Treasury QE. That's the difference. But it's good for the economy. And that's why the economy is racing ahead in the short term, because there's so much spending going on. Yep. Mike Scott. I got a lot. I had a Glitch, but one thing I want to bring out is piggyback, and I heard part of what you were saying, Michael, and you, David, is the latest headline from UK expected to follow EU with China EB tariffs, Times says, and also my colleague Javier Blas, who I saw in London last week, what my new EV says about the future oil demand. My EV is 12 years old. But this severe deflationary forces, most normally renewables and awesome vehicles that are making the rest of the vehicles that some of us, Germany and U.S. are making look like buggies coming out of China. It's just the fact that we have

100% tariffs on you show you where it's going. This is a pure deflationary force. And look at the AI. The AI, I heard who was an AI expect to say maybe 22 or so percent of AI use in the U.S. in the next few years will be from China's type entities. Now, I know that, I don't know if that's true. But just the valuation of our equities are so dependent on this technology and the deflation out of China, I see in terms of commodities, like, when people say Crudeau's going to go to 150. I'm like, what are you missing about what's happening with this global paradigm shift, where the world's largest demand pulse source on the planet for, like, energy is replacing with EVs and exporting all that to the rest of the world.

And their EB sales are rolling over. Now they're pressuring the whole EU. The fact that U.S. has on a percent percent of terrorism shows how good those vehicles are. And then you see massive supply commodities. This is all that rapidly advancing technology. And I see a stronger dollar, the Fed tightening, most central banks tightening from terms of commodities. This is wonderful.

I mean, this is a terrible environment, particularly if they've gone up so much. This is just a classic, I think, sell. And then I also tilt over to the metals, which makes me related to crypto. I put them in the same bucket is the Bloomberg All Metals Index. In the beginning of the year was up 22% on the year. That's the time in the beginning year, the U.S. was priced for the Fed to cut 50 base points by the end of the year. Now the metals are down in the air, and we're looking for the Fed to hike three times. To me, this is just part of that lose-lose.

We're absolutely positively, any bullish position you have on almost any position, even bond yields, depends on the stock market. And right now it has to go up. And so I just kind of make it keep it simple. So Mike, one point I just have to make because it's so important is people conflate consumer inflation and asset and monetary inflation. And technology being what has been over the last 25 years in a normal scenario, if there was if there was zero monetary inflation in the last, you know, in this century, we would have had massive deflation.

because there's been massive increases in productivity. AI is going to drive a lot more on the service economy, but before that, we had massive productivity improvements, massive other improvements on technology, etc. All of that is consumer deflationary, but we don't see it as deflationary because of monetary inflation. So what does that mean? It means that the bifurcation between things that technology can't affect

and what technology can affect goes much wider. that's how people perceive it. But every time you conflate and say, well, AI is causing deflation, therefore bonds, it's like, no, they're very different. AI doesn't affect bond prices. It affects AI affects the ability of a human to create a output of work. And that, by the way, is massive. And it's one of the reasons why the biggest jaw chart we've seen has been corporate profits vis-a-vis wage growth. Corporate profits have gone crazy. on the upside and wage growth has not. And we're seeing that and, and,

but that is nothing to do with the fact that there's a massive liquidity impulse and massive fiscal deficits. It's, there, those are two fighting trends in a sense. But when you're talking about assets, to ignore it is a problem. And I wanna set up Michael for this because this has been, you, you and I have, this is literally the stasis,

the literal place where you and I disagree the most, right? Whereas I'm more monetarist and you're more, more Keynesian. I understand that. But this is a real important point. It's like technology. We are living in the next industrial revolution. We've had two waves. The internet in the 2000s, you know, in the early, you know, end of the 90s and

2000s and AI now. And, you know, of course they politicize both and et cetera, but it's inexorable. You can't stop innovation. You can try to slow it. You can let other people have it, but you can't stop it. And that's a, it's a very, very big impact. So let's tilt over the, Michael. I'm neither monitor as canyous or anything.

I'm just realistic. And we have to point out that we have the number one thing, the number one thing driving the whole world economy right now is the excessive valuation to a stock market in the back of AI-driven, my hypers, basically, in terms of the top seven or whatever, all kind of related. We've seen this before. There's always a good reason.

It could continue. But it's going to lead to severe deflation in the future, partly because of the technology. those of us who are adopting it completely, just a matter of shifting over the jobs. The key point is right now we're in that inflationary period, which is bad for bonds. I mean, just the fact that we have most central banks hiking rates. And the number one issue in this country is affordability as we head to midterms is a key fact. Also, we're getting that major shift where we're getting pretty hedonistic Republican or capitalist

Republicans slinging white. And the whole system always swings back the other. That's what we're going to get in a few months. And I think what you're going to see is a pretty significant blue way. But one of them are voting against this inflation and energy and food. And all the rich people make more money, particularly the people in our government and them not doing it. That's the bulk of the bell curve of votes. So I'm pointing out the macro here that you see is how we're all stock puppets right now,

particularly if you're bullish, Bitcoin or gold, you've got to have a stock market go up. Most know the U.S. So that's what I want to ask you or anyone. If we drop 20% Nesmi 500 state down in a while, what does that mean for any position and anything? Of course, that's a significant if statement, but stuff that used to happen. Like I quote Jack Bogle. If you can't imagine that, then you shouldn't be in stocks. I can't imagine it right now.

That's why I think I need to imagine it. Michael, a lot to unpack there. Boy. I'm very much of the view that, you know, but parling to risk assets now is not a great idea. But as I said earlier on, you've got to separate trend from cycle. And the fact is, if there is a major sell-off in risk assets, you're going to have to get policymakers coming back to reflate the system. They can't afford to have a recession.

So you're going to get more fiscal spending and more liquidity pumped into the system. As sure as eggs or eggs. I mean, I think that that's the backdrop. So the trend is there. And, you know, people say that, you know, this is the end of the financial system. You know, capitalism is going to end or whatever. Look, for heaven's sake, politicians have been doing this for 150 years, okay? Look at the value of the dollar in sort of 1900 or 1914, where it is now.

It's basically a few cents compared to what a dollar was then. Okay, this is going to go on forever. You're looking at this sort of continued devaluation. But what I'm saying is that there's more impetus now because there's a great reluctance to sort of butt for politicians to bite the bullet and go to austerity or whatever it may be. So you're going to have to have money printing and that's what they're pretty much doing. But I do take the point and I agree with what Mike has been saying is that you are somewhere near the peak in these risk asset markets. And I think the bond markets are telling you that there's a lot of opportunity in fixed income over the next 12 months.

I mean, to buy tips at around 3% yields is a fantastic opportunity. You know, it's very rare you can make 3% real in financial markets over the long term. But the US government is guaranteeing that. So I think that's not a bad place to be. Do I want to be in bonds long term? No way. But certainly it's a trade. I think it looks pretty decent to me.

Michael, let me ask you this, because as I listen to everybody, there's a consensus that money printing is the only way that that's inevitable and what is guaranteed to happen. I guess the question that we never really discuss is what happens if money printing does come in and fails. I think that's what Mike is sort of talking about here, right, is that you get the money printing, it doesn't work, and then you see the deflationary collapse and we go into a depression. Mike, I don't want to put words in your mouth, but I think maybe we're not going further enough down the timeline at what could happen if the printing failed. Well, what's passed it over to Michael, but that's the fact of what's happened in Japan 30 years ago, what's happening in China right now. Back to you, Michael. Well, what's going to happen here is that debt, I mean, the problem in Japan, and maybe the problem in a lot of Western economies is that there is a growing burden of debt and that debt saddles the economy and it makes, it slows down the rate of economic growth. So you've basically got to devalue debt. Now, as I said, the big debt problem, far away the biggest debt problem right now is not the US nor Europe, it's China. And China's the economy. It's got to get out of its debt problem. And,

And the difficulty there or the difficulty China faces is that the whole integrity of the PRC is all about creating wealth or continual wealth for Chinese residents. If they fail to do that, then the whole system becomes questionable. So I think they're going to have to bite the bullet and somehow devalue the yuan internally. Now, I stress the word internally, because I think with this array of capital controls, large Forex reserves and compliant state banks, they can pretty much achieve what is called a dual circulation between an internal yuan and an external yuan that basically, you know, it doesn't change much against the dollar. But the fact is that if they start printing money, which there's every

evidence they're doing right now, the gold price goes up. And when the PBOC began printing money was around about, you know, around about, well, in fact, the early 2020s, it pretty much coincided all led an increase in the gold bullion price because it was China who was buying. Who's the marginal price and now of gold? It's the Chinese, whether it's the central bank or whether it's Chinese retail. And that's all about money printing in China. So, you know, the story isn't really about what the U.S. is going to do or what Europe's going to do. They're going to follow as well. There's, you know, absolutely certain. They've got no choice. But it's the Chinese we've got to think about. And, you know, that ultimately is how the system will reflate. Does it mean you're going to

get more high street inflation, almost certainly. But I think the question is, are we talking about what scale are we talking about? In the U.S. are we talking about, you know, four to five percent underlying? Probably, we're not talking about 10, 12 percent. But this is quite manageable, I think, within the system. The system won't break down on those sort of levels. Dave, I was going to let Mike talk, but Mike, you're muted. Go ahead, Dave. I figured you'd have something on that one. Yeah, I mean, look, you know, first principles, you know, it's like it's funny. So this morning we just saw bad U.S. consumer confidence and Bitcoin jumps 500 bucks.

I mean, does it matter? You know, back up over 86 again. You know, it's like the point that you've made, Michael, which is absolutely true, is that Bitcoin trades directionally as the highest beta to perceived monetary influx. or to receive liquidity, full stop. I cannot see a scenario where bonds rally and Bitcoin doesn't rally with them. I can't see it. I mean, it feels like, and I think you're right, I think there will be a bond rally here. I think that, you know, there is opportunity to make money and people lever up.

And look, I work for two sigma. I spent a lot of time, you know, five years at one of the larger quantitative hedge funds, although it wasn't one of the larger ones when I started. But what you learn, you know, very quickly is how much leverage can be put into exploiting, you know, some small number of basis point, you know, pickups. And so all these yield differentials matter. And when the entire world is moving in the same direction, you see that trend continuing. I think that what's going on with bond yields now is cyclical. Yes, it's based on economic growth. But if that economic growth starts to slow, you could see a rip-roaring bond rally.

When you see a rip-roaring bond rally, what is that going to mean? Well, you're going to see more monetization when that happens because it's the timing, right? You know, Besson's a trader, if nothing else. And I just don't, I can't see a scenario where the most important asset from a, not important, most beta-driven asset to liquidity doesn't do well in a global bond market rally, which I do think we're, even if it's just a relief rally or a dead cat rally, we're due for one fairly soon. So we'll see.

Let me ask you, I know, Mike, you're about to jump in, but isn't there a world where bonds rally because docs are crashing and that makes us wonder what happens to something like a Bitcoin, which you think would go down, right? Dave's saying basically a bond rally, Bitcoin goes up alongside it. You would probably see bonds rally if the stock market had one of those corrections you're talking about, wouldn't you? The number one factor for bonds to rally for the Fed to ease back on their tightening and switchease is one simple thing. 10% correction. S&B 500 stays down the well.

That's it. Don't fight the Fed. If you're buying Bitcoin, gold, metals, copper, stock market, you're fighting the Fed. That's the number one factor. Very simple. Stuff that used to happen that doesn't happen anymore that can't even imagine. But then so I go to Michael, though. there, then is there a world where bonds rally and Bitcoin does not? Because there's a fundamental

divergence there in how Mike and Dave are viewing this. Well, I think the fact is, I would argue that if bonds rally, we're living in a collateral-based world and the bulk of collateral is US treasuries, if you get a strong bond market and bond volatility on top comes down, you're going to see a big collateral multiplier boosting liquidity. And in that situation, Bitcoin will go So I think that the question really is, is that, you know, what are those, what out of those things breaks? And I can't see it. I think the two will be correlated. I kind of agree with Dave that, you know, if you're going to get this situation, it looks pretty good for, as I say, these monetary inflation hedges. Because coming out the solution, what the bond market is pretty

much telling us is that the Federal Reserve is going to have to ease, simply because the economy is looking ropey. And, you know, that's why you've got to start looking pretty closely at the long end of the market to see if there's any signs that it's beginning to, the yields are beginning to peak. I'm already, if you look at term premier, they're starting to edge lower, which I think is the first sign of this. And I've been saying to our clients, look, what we're facing here is, you know, it may be an odd stock market cycle, but it's certainly a classic bond market cycle. This is actually plain vanilla in bonds. And it looks pretty plain vanilla in commodities too.

But cycles go up and cycles come down. Isn't there a world where you can both be right, depending on time frame? Timeframes everything. Because we all know that correlations will go to one if there's a Black Swan event and the stock market drops in a day or in a week, 15 or 20 percent or something from a black swan. I think we all probably agree that gold, Bitcoin, everything will drop in that scenario. So Mike, you could be right there, but then the debasement trade narrative could come back And depending on how people view Bitcoin, it certainly could do what Dave and Michael are talking about, which is rise.

It's all time frame, but there's a big problem with a flock of pigeons versus a couple dubs. We all agree that there's many of these millions of cryptos that need purging, something within the next top, no, Dogecoin is number 11. Some of this needs purgeant. We all know that the only way you can sustain type of silliness in market valuations and stuff that tracks nothing. is when you have a stock market cap at the historic 100-year highs. And that's maybe a question we can ask the group. Is there ever been a time in history where these things have been sustained? There's only one example, 1929 U.S., 19809 in Japan.

And they just, they last for a while and then they go away. But that's the key thing to remember here is we have not seen the test for Bitcoin and Cryptos. Let me see a stock market to go down and stay down a little while, maybe not make a new high for a year, and see how this lacks. Now, I fully think it's, I really appreciate people to think Bitcoin will rally in that environment. I wish you luck. virtually no value at risk model will show that, particularly since we launched ETS. And what did ETFs do?

Those of us who are on top of this when the futures were launched and the ETSs were launched, they're in the mainstream now. This is not the old days when people like Scott jumped on it about 100 and maybe even me below 5,000. Now it's mainstream. It's a mainstream asset. Volatility is going down. It trades.

It's just a stock puppet. And then the key thing to remember is don't underestimate midterms. Midterms are coming up. And after we get to midterms, we're going to. we're going to probably see a major check and balance. So here's what's going to happen. We've had some pretty prolificate spending in this current government, and certainly the builder and president.

There can be a major check of balance against that after midterms, but it's actually a pretty significant blue wave. That's very good for bonds. And there's only one key market. I can see that we've had pretty significant buying when they're crying. Senses, and that's a bond market. U.S. bond market. There's certainly crying in that market.

Dead wrong on that one. But we had some major sound when they're yelling in. And cleansed in Bitcoin within a year ago and lurched all the metals. a year ago. But the key thing was also look at copper. It's the fact that its correlation, a 50-day, 50-week basis with the stock markets the highest in its history on the way up. There's warnings coming on here as we had volatility season. I just like I know Dave, you have to jump in, but I just got to say like I, it's hard for me because I agree and disagree with you so much in the same paragraph because I agree about the pigeons. In New York City,

we used to call pigeons flying rats, right? So if they're eradicated, then by all means, I don't think anyone would mind. I agree with that on the meme coins and the nonsense and the long tail of crypto assets. But Bitcoin's not a pigeon. It's a falcon or a bald eagle and it has nothing to do with the pigeons, in my opinion. I don't think that coin market cap number 75 is going to do well on a debasement trade narrative if the stock market crashes. But that doesn't mean Bitcoin won't. I know that we diverge on this, but I agree with a lot of what you're saying.

There needs to be a purge. I just don't think I think I almost numbers 75. It's injective. I probably do too and it's worth done. You know, look, the argument about crypto versus Bitcoin, you know, Michael, just so you can hear it really quickly is I consider myself a Bitcoin monetary maximalist, but I think there is value in crypto. I think most of the coins have absolutely no value. And some will be winners. And it's going to look a lot like the internet bubble, but it's a slow motion train wreck.

Because in the internet bubble, what people don't understand is stocks, when they die, they die. Cryptos, there's no carrying cost. You know, you want to keep a corporation going. You have to pay to have humans and it's expensive and companies go bankrupt and then the stocks get delisted or even go boof on the pink sheets. Although some of the bankrupt stocks trade like, you know, crazy for a while on the OTC. But the truth is that they do die. crypto, you know, FTT still has value, the token from FTX despite whatever, because there's no carrying cost for it.

The tokens just exist. And people could trade them like they trade Pokemon cards. And so you have this weird thing. And Mike and I both agree that it would be better if these things died. But the truth is, if there's no one to sell, then the price doesn't go to zero. Right. And so there's that carrying cost. I'm tired of this.

$90 million fully diluted. Yeah. Well, because the people who own it are kind of keeping it in frames or, you know, it's like, you know. I've had that to Mike, though. Those things are dead because nobody's trading them. They're sitting there. Nobody's going to sell it. Nobody's going to buy it.

It's dead with a $90 million market. People trade them like Pokemon cards. That's what they do. But that's why I want to ask you, and the whole group and have our whole audience, get the part of I get about tokenizations, but I've been so bullish on that space forever is the proliferation of dollars because it's just a better way to transact dollars globally. Learn that in Hong Kong almost a decade ago. But when you get a tokenized real value asset with earnings next to Dogecoin on a screen, which one you're going to buy, which are you going to short? That's my point.

Once this tokenization. Let me explain tokenization very quickly. All assets will be tokenized, full stop, because it's better than paper. But that doesn't mean anything. It's just a question of compare asset A to asset B. I've been making the point you just made for three years. I will continue to make it. And you're seeing it.

I mean, I can tell you, based on, I have. have like stuff in my portfolio that that became worthless that's useless so i haven't sold it i think i have like you know somewhere in the neighborhood of under fifty dollars worth of probably 20 or 30 things that who knows what they were worth at their high i don't know but they just i didn't sell it quick enough and then they died i mean smoking chicken fish tokens is my is the one i always come back to i mean i think i put 300 bucks into that and at one point it was worth 600 and now it's probably worth six dollars right I got a bunch of those things where I got it wrong. There's no question about that.

But none of that has a damn thing to do with Bitcoin. None of that is a damn thing to do with Solana, that matter, or Ethereum. Those are totally different things because those are both fighting to be the base layer of a lot of stuff. Now, what the valuation is, what will happen to those things, are they massively overvalued or are they undervalued? You could go have entire shows based on that. But this market, what matters is there was this huge,

OTC market. I mean, anyone who's sitting on a trading desk in 2000 in 1999 remembers this. You know, every day somebody would run over to the desk. Hey, did you see this thing? You know, Net Taxi, that was one. And there were a whole bunch of others. There were thousands of these things. And everyone was trading them. And they would go crazy. I mean, you're talking to things that would go from, there was this company Net Taxi that was formerly, in 1997, was Swan Valley Snowmobiles. I'm not making this up. They renamed it to Net Taxi, claimed to have a payments processing system, and the thing went to almost a billion dollars of market cap. And, you know, I was lucky enough to sell a quarter of my position, you know, halfway up to the

high, and so I actually made money on this thing. But at one point, my paper wealth was huge. And then, of course, the whole thing went crashing debt, right? You know, and it was bankrupt within two years. Crypto doesn't have the same discipline because of what happens to companies. So these things don't crash the same way. I mean, we saw BitConnect. Remember that one, Scott? Oh, yeah. Coin market cap on the site said, we believe this is a scam. It had a billion dollar market cap before it's back. It's because it's because of the carrying cost.

So yes, there's insanity in markets. Yes, there's crazy crap. But as analysts, we are trying to help people understand where value pockets are. And I do don't think, I think that correlation is semi-spurious. Doge is a different animal. I don't own any or if I do. it's a dog end in a portfolio. I don't understand, but I do see what it is.

I think the model for Dogecoin are Pokemon cards or baseball cards. I think that's what you're looking at. Collectibles. Well, honestly, I actually owe some because I was at a dinner table with like my friend, my son and a bunch of friends years ago. We were just putting hundreds of dollars in it. And there was just like a bar, you know, banter. And it was fun.

But I just point out, you know, same chart syndrome. They just go up together and go down together with Bitcoin. Most of the all. I'm just pointing out facts. I know Bitcoin's outcome. I got to get it. But they do have same chart syndrome. Right.

But there is just two things. And I want Michael wrap us up. But two things is that there are worlds where all coins crash and Bitcoin goes up. In fact, like if Bitcoin rips, historically, you see a major rise in Bitcoin dominance and, you know, major fall at all coin valuations versus Bitcoin. So that that does happen. I will tell you that what's going to solve this problem largely, and we're seeing it already, is that all of those useless tokens that have market cap are going to be liquidated via AI hacks

because there's nobody with a security budget paying attention, and that's going to clean itself out, sadly. You're holding a token that's number 200 and doesn't have a team working on it. Eventually, like all of these ones we've been seeing over the past few months, somebody's just going to exploit it, steal $4 or $5 million. It's going to trend towards zero, and that'll be the end of it. Michael, yeah, Michael, I would love your kind of final thoughts, I guess, maybe on the Bitcoin and crypto side, since that's where we're at and then we'll move on to next week. Well, I think as Warren Buffett said, when the liquidity tide goes out, you see he's swimming

naked. And I think you can see that probably with a whole raft of these cryptocurrencies. That's going to be plain. But I come back to the point that you've got to separate cycle from trend. I think the trend is towards monetary inflation. I think that's inevitable. whichever country, whichever you look at, governments simply can't afford to tax us anymore, and the bond markets are exercising a discipline, which means they've got to print money. And that's a fact. And that means China. It means Europe.

It means the US. Everybody has got to inflate over the medium term. But that's a progressive whirring in the backdrop. And it may mean that monetary inflation is going on at 7 to 8% per annum, all that sort of pace. And I think that's the trend we've got to start looking at. But make no mistake. And as Mike says, there's a cycle we've got to recognize. And that cycle is telling us, in many cases that, or bond markets are the truth.

And they're telling us that we're somewhere near the peak. Yields have picked up. And bond markets on a 12-month view look to me pretty attractive, much more than stocks. Stocks are in a bubble. I don't know when they're going to break, but they're going to break. And, you know, as regarding the AI thing, I mean, I'm old enough to remember global crossing. And just look what happened there? The fiber optic market.

I mean, that was the Darling and Wall Street. What was it? Well, 20 years ago, probably now. But, you know, what happened to fiber optic prices? They went down 80% because of competition. And within five years, Global Crossing was in Chapter 11. And let's know single any particular AI company. But, you know, the switching cost between these is actually pretty low.

So at the end of the day, I think there's problems afoot for many of these stocks. And therefore, I'd be very wary about them on a, on a one to two year view. I think bonds look a lot safer, and I'd be thinking of bonds, but I'd be buying back into monetary inflation hedges with alacrity after any sell-off. It would be an opportunity to buy if these things come down, not to sell them. You guys are all extremely intelligent, humbled to be able to sit here with you. And all I hear is that it's all about time frame, once again.

Buy bonds, but not like Mike has forever buying for 12 months and rotate back into Bitcoin, which Mike thinks will be going to 10 at the same. I got it. We have a lot of opinions on the same things, but I, you know, I'm an optimist, so I hear the agreements more than I hear the disagreements, and there's quite a few of them in there. Michael, thank you so much for joining us today. You are literally welcome back anytime. Great, great. If you'll have it. Great pleasure, gentlemen. Thank you. And David, Mike, as always, thank you for the banter and for the perspective. We'll see you guys next week. Bye, everyone.