The Wolf Of All Streets - Solana Skyrockets, Gold Rallies. Why Is Bitcoin Down? | Macro Monday

Episode Date: March 18, 2024

Join Dave Weisberger, Mike McGlone, and James Lavish as we break down what's happening in macro and crypto! Dave Weisberger: https://twitter.com/daveweisberger1  James Lavish: https://twitter.com/jameslavish  Mike McGlone: https://twitter.com/mikemcglone11  ►► JOIN THE FREE WOLF DEN NEWSLETTER, DELIVERED EVERY WEEK DAY! 👉https://thewolfden.substack.com/   ►►OKX SIGN UP FOR AN OKX TRADING ACCOUNT THEN DEPOSIT & TRADE TO UNLOCK MYSTERY BOX REWARDS OF UP TO $60,000!  👉 https://www.okx.com/join/SCOTTMELKER  ►►TRADING ALPHA READY TO TRADE LIKE THE PROS? THE BEST TRADERS IN CRYPTO ARE RELYING ON THESE INDICATORS TO MAKE TRADES. USE CODE ‘25OFF’ FOR 25% OFF WHEN VISITING MY LINK.  👉 https://tradingalpha.io/?via=scottmelker ►►NGRAVE This is the coldest hardware wallet in the world and the only one that I personally use. 👉https://www.ngrave.io/?sca_ref=4531319.pgXuTYJlYd  ►►NORD VPN  GET EXCLUSIVE NORDVPN DEAL - 40% DISCOUNT! IT’S RISK-FREE WITH NORD’S 30-DAY MONEY-BACK GUARANTEE. PROTECT YOUR PRIVACY! 👉 https://nordvpn.com/WolfOfAllStreets   Follow Scott Melker: Twitter: https://twitter.com/scottmelker   Web: https://www.thewolfofallstreets.io   Spotify: https://spoti.fi/30N5FDe   Apple podcast: https://apple.co/3FASB2c   #Bitcoin #Crypto #macromonday  Timestamps: 0:00 Intro 3:14 Meme coins 6:30 Where is the Fed? 11:15 Gold 13:40 Fiscal & monetary policies 18:25 Inflated money supply 27:20 Gold hits new all time high 32:00 Elizabeth Warren 36:30 Xi, Putin & the world order 39:10 Bitcoin 43:00 Michael Saylor & Microstrategy 50:00 Fomo 51:30 Massive trading volumes 54:00 Silver 56:10 Mike is finally Bullish on Bitcoin 59:00 Chevrolet Nova The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. This video was created for entertainment. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this video constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.

Solana has skyrocketed on the back of meme coin madness, not usually the topic to discuss on a day like Macro Monday, but many people point to this as an example of the froth that can happen in the crypto market and could signal at least a local top. I want to discuss that with Dave Weisberger, Mike McGlone, James Lavish. We're also obviously going to talk about macro, liquidity, gold, Bitcoin, everything else you guys have come to expect from us. It's Macro Monday, my favorite day of the week. Let's go. And Mike, you're on my time zone, so we don't get any special accolades for being here at 9 a.m. Guys, listen, the title here, Solana Skyrockets. For those who don't understand, meme coin madness is happening. It's absolute insanity.

And it's mostly happening on Solana, which means people need to buy Solana to buy these meme coins. Price of Solana goes up, approaching an all-time high. But guys, this level of froth we're seeing here is insane. I just saw this tweet. Dude raised $30 million pre-sale in under 30 minutes by listing an address on social media. Gary Gensler doesn't understand the power of apes. Then I clicked on the tweet, and it's already been deleted. So probably an exit scam for $30 million in a matter of minutes. This guy literally said, OK, I'm selling 20% pre-sale on this token.

Here's a Solana address. Send your coins. I'll send you money back. $30 million in a matter of minutes. What is this a sign of that's happening in this market? Mike, I know you love these things. Oh man, you don't want my condescending view. You already nailed it. This is classic signs of speculative access. And it's one thing, man, I like how Dave says it sometimes, be careful with leverage. And James mentions that too. But I come from that environment. I was born and raised in leverage and futures is typically 20 to 1. You just stop yourself out and hope you don't get stopped, run through your stops and stuff like that. But the key thing I think there is, it's example of the massive speculative access as you're seeing in, there's

Bitcoin and then there's 30,000 wannabes. And then of course, the fact is that I think it's all indicative of the macro big picture. I still look at cryptos as a great leading candidate, particularly Bitcoin. It's also indicative to me that, yeah, if you're the Fed and you see this big uptick in the stock market and the massive speculative frenzy in cryptos and inflation upticking well above your targets, do you ease that environment? And that's what I'm kind of like, why would they consider that? It's just spiking that. So I can tilt over to some of the stuff from our meeting this week, but to me, that's the key thing.

And I also have a few things I'm going to key James off because on a global basis, the stuff from my view from a commodities is clearly still towards recession let's just uh let's circle up on the on the meme coins and what it means dave then james and then we'll go to your morning meeting mike and we can continue from there so if you want to know what's happening i i watched the movie on the plane over uh to england and it's literally a perfect analog for what we're seeing in the employees. It's a Beanie Baby movie starring Zach Galifianakis and Elizabeth Banks, and it was brilliant. It was a really good movie, and the funniest part about the movie is most of what mattered or what was said in the movie, the craziest shit, was all true.

And you have what is a speculative frenzy for something that the only reason it mattered is because other people wanted it. And so what's happening with meme coins is no different than Beanie Babies. Now, will they go to zero or will ultimately some of these things be considered status symbols like a Birkin bag? I don't see how. My brain doesn't comprehend it. I mean, to me, the ultimate irony is how Elizabeth Warren and Gary Gensler have effectively created this. And yes, I said Elizabeth Warren and Gary Gensler have created this. Let me repeat it for a third time. They who like to criticize and protect investors have created the meme coin craze, because instead of building a community, which has some ability for the people in the community to monetize that community, participate in the economics,

create something where you can create something around it. All these meme coins share one common characteristic. They all say, we don't have any revenue. We don't have any monetization. We don't have anything that could make us be called a security. We are just for fun. And once you do that, it doesn't change the fact that people are going to speculate in it, but it does mean that it's probably going to end in tears because eventually, like Beanie Babies, they're going to die out. So they have gone to the point of creating rules where you can't create a community, incentivize it to one where you can have a community and have fun, but you can't participate in the economics. And to me, that is the ultimate irony. And if I want

people listening, you shouldn't hear anything. There's nothing to do with macro Monday, but it is a very important point. Why are our regulators, why do they all deserve to be voted out of office? Why should John Deaton beat Elizabeth Warren? Why should we be looking to get rid of Sherrod Brown and Brad Sherman and what's his name, Jack Reed, who I guess he's not up for election in this cycle, because they're forcing the regulators to avoid any sort of disclosures. So there's no way for people to know that these things have no economics. Most people buying this stuff is like, they're buying it because they think it's going to go higher. And they have no idea that it's a game of musical chairs.

So when the music stops, that's it. Send $30 million to a anonymous Twitter account with just an address with zero guarantee signature, nothing. Yeah. I would say that just because they expect it might go up. Go ahead, James.

Yeah. It's clearly the afternoon where Dave is. So his mind is clocking at a different rate than us. So look, the memes, I mean, these are meme stocks. I mean, what else is there to say? So as far as the Fed's concerned, it's interesting. I turned on Bloomberg this morning and I don't know if you saw it, Mike, but Claudia Assam was on there. And they were interviewing her and asking her what she thought the Fed's kind of stance was, where they are. And she pointed to a couple of data points that are

interesting. She refuses to, well, she was adamant that the retail sales numbers, the recent retail sales numbers were pretty much abysmal. And then pointing to the CPI numbers and the inflation numbers, the stickiest part in there is there are aspects that the Fed can't do anything about, like inflation on car insurance. And that's because of the rise in the sales price of used cars and the maintenance on them. It's not going away. That's super sticky stuff. And so her point is that we're going to listen to the Fed and hear what they have to say

this week. And surprisingly, Powell's been pretty quiet. I think it's got the markets not spooked, but just wondering, are we going to get three cuts? Are we going to get four cuts? Is it going to come in June? Is it going to come in July? And I want to hear what Mike has to say and how he's teeing me up on this.

But, you know, I mean, they're in a spot here where they want to lower rates you've got conflicting data you've got some really kind of crummy data that we we revise and revise and revise and revise and so it's it's really difficult to see what's going on especially as as these numbers come in and they're they're so they're already lagging and then the revision is lagging so um you know again the fed just they, you know, again, the Fed just they're not looking at these meme stocks. They're not looking at them. I don't think they're looking at this, the crypto market and taking into consideration pretty much at all. I think they're just, you know, the only consideration they'll have is if the if the stock market crashes,

then that matters to them because it will impact the treasury market effectively. And that's the only thing that really matters to them in my mind. So, but yeah, that's kind of where my headspace is early this morning on Monday. I just really quickly, you know, I just did see this article last week. JP Morgan, Bitcoin surge could raise concerns at the Fed. Rate cuts might be delayed. Right. So now they're saying actually that JP Morgan saying Bitcoin could be the cost. Absolutely ridiculous. Absolutely ridiculous.

Yeah, that's so funny. Go ahead, Mike. I did. I agree with your disagreement, but I did point out I like pointed out a couple of years ago, pointed out how Bitcoin as a leading indicator has been good. Sometimes give you those little indications for what to expect from the Fed. And, you know, it's it's almost end of the Q1 and S&P 500, Bitcoin and all goal of all made new highs this quarter are just kind of hovering within that area with little profit taking and stuff. So questions, where do we go from here? So just a key thing is it's all about the dot plots this week. And Anna Wong, our chief economist, expects they're going to stick with the 75. It's a question between 75 and 50. She thinks Powell might surprise on the double side. I think why? And the key thing is the labor market's just getting weak. Is it part of the SOM world? You know, labor market's up up only five cents from the low, it's kicking higher.

Is it getting help from the Fed? No, not yet. The key thing I also enjoyed from our equity strategist, Gina Martin-Adams, she pointed out the biggest risk to stocks is inflation. And I'd like to point out, well, that's the problem right now. Just like what commodities did two years ago, they were their own high price cure. Every single time you see that stock market goes up, inflation's picking up. Copper's kind of coming up a little bit. Cr. Copper's kind of coming up a little bit.

Crude oil's kind of coming up a little bit. And Fed rate cut expectations are dropping. And I look at it as, you're the Fed. Your targets right now are double your inflation. I mean, inflation, their measures are double their targets. They're upticking as the stock market goes up, as Powell probably pivoted a little too early. What's your risk? Ease early and do the same thing he's been trying and pointing out for the last two years that he wants to avoid those risks of inflation. So I look at this as a silly situation

where the Fed might say it, but one thing that Scott's been on top of for a while, every single time we've priced for these eases, since we started pricing for 100 basis points of easing at the beginning of 23, the Fed raised 100 basis points last year. It's like I'm loving this. But the key thing I wanted to point out is I just finished my gold deck. I just compared gold versus everything. From a commodity guy, it's the only one that goes up basically over time. And the thing is the world's changed so much that you can't have gold anymore without Bitcoin in space.

It's just a fact, unless you want to take risks. But the one thing I want to tee off you and my colleagues on is, I've been comparing lately how people keep saying US bond yields are going to go up. And I've been comparing them to, well, OK, you're getting 100 basis points less in Germany, well, 200 in Germany, in Greece, in Canada, 200 basis points less in China. And even in India, it's not that much higher. So I did lately, I just did a metric. I compare the four top GDP countries in the world behind the US.

If you just take the average of their 10-year note yields. I mean, this is a bond guy. I always think bond guys tell the truth. The average right now is 115 base points below the US. So that's an indicative of where the world's going. The rest of the world's got a big problem if the bond market's telling you something. That's deflationary, disinflationary trends, and the market's just what you'd expect after the cycle we've had up to that peak in money supply. It's all tilting that way. The US is the only one accepted. But the difference right now in yields

between those four countries in the US is about 115 base points. The US is that much higher. So I look at it as we have a completely inordinate burden on this US stock market to keep going up. We haven't had a 10% correction since the low in October. We've only been down one week, I mean, over 1%. And I look at it as, okay, I still stick with that view that from a risk management standpoint, someone who's running hot money, you get your value at risk model. You did really well catching this rally. And now I think most smart money managers are pulling back and waiting for that next opportunity because this rally in the equity market is somewhat parabolic, but it's without

corrections. Bitcoin's had a correction. Bitcoin's had a correction. Gold's had a correction. And it's just, if I look at it as Dave will agree, but beta has little correction. Everything has a problem. That's why I'm just kind of waiting for that test. Can we get through that year without a test? That would be wonderful, but that would be very rare.

So the key thing I want to tee James off on is this fact that virtually the rest of the world, in terms of bond yields, is in a recession, most notably compared to the US. Yeah. Well, that's a great point. And so we've been talking about it a little bit, and I wrote about this weekend just to kind of get my readers on my newsletter to understand the difference between these things. But we have an issue between fiscal and monetary policy. And so you are seeing and there's no denying that there are pockets of recession in America. There are there are areas of our economy that are struggling. You're seeing layoffs. You're seeing margins being squeezed.

Anything that's really interest rate sensitive. We all know that that commercial real estate is super interest rate sensitive and they have a major issue. You know, any companies that are high leverage that have economy kind of grind in these areas, especially in some of the consumer areas. Now you're seeing, like Claudia Psalm said this morning in the retail side, look, the individual consumer has been piling on credit card debt just to keep up with the rising prices. You know? And so, yeah. And so in that newsletter there, I'm talking about how you've got the feds got they've got two main tools, right? The two main tools are to control the interest rate or the target rate, and QE or QT, which is managing the their balance sheet. And so they've been letting bonds kind of mature off their books. And they haven't really been actively selling, but they've been letting bonds mature off their books, which is that takes liquidity out of the market. They raise the

cost of capital that takes liquidity out of the market. But on the other side, what is completely overwhelming this, and you're seeing pockets of expansion, especially in infrastructure spending, in the green energy spending, because of the so-called Inflation Reduction Act and the spending coming out of Washington, we're running $2 trillion deficits. That's 7% of GDP. So that right there, go to that next chart there, Scott, right there. That's our inflation rate. And you can see it's kind of stopped out. It's kind of gotten sticky here above 3%, somewhere between 3% and 4% that they admit to is where the inflation is kind of bottomed out. And that's because of all the spending that's coming out of Washington. It's a massive amount of liquidity and it's stimulus coming out of Washington. So now you're seeing pockets of expansion versus pockets of recession. And so to Mike's point, yeah, we are experiencing recession because of the Fed

monetary policy in areas. But in other areas, people are not experiencing it at all. So when you go out to restaurants, you see a bunch of boomers in restaurants. They're older people. They're just spending and spending and spending and spending. They've got all this money. Why? Because they retired in the pandemic. They're sick of it. They're like, I'm out. I don't need it. I'm going to start collecting my benefits. I've got Social Security, Medicare, Medicaid on top of my pension, on top of my house that's up 90% in just a few years. I'm good. I'm, I'm just going to, you know, spend until it's gone and my kids can figure it out themselves. And, you know, I mean, that's kind of, that's kind of the, it, you're seeing a difference between you've got millennials and Gen Z's who are like,

I'm working this job. I can't pay for my rent. I can't pay for my car. I can't pay for a cup of coffee versus the, the, the older demographic, which is like, I don't pay for my car. I can't pay for a cup of coffee versus the older demographic, which is like, I don't know what everybody's complaining about. Life is good. You have two different economies within America right now. And that's kind of what everybody is sensing from a hundred thousand foot view. That's what people are sensing. And the White House is gaslighting you and saying, inflation is coming down. It's not coming down. Prices are not coming down. And then you've got, you know, the treasury is just spending and spending and spending and spending. So it is by far the most perverse thing I've seen yet come out of Washington to spend, to have 7% GDP or six to 7% of GDP, um, you know, deficits at a

time when that the economy across the board isn't, hasn't even really officially ticked into recession. It's just, it's, it's nuts. Here, right. It hasn't ticked into recession here. Right. So like across the board, because we're, because we're spending so it's just it's it's yeah it's it's it's mental it's mental dave you want to jump in or uh yeah jared you're muted i mean look look look the the simple fact is that when you inflate the money supply and you financialize the economy, you create massive tailwinds towards wealth inequality. Because the rich literally get richer and everybody else finds it more difficult. In that environment, models we don't assume that happening are going to be flawed and and that's what we're seeing you know i think we the fed i've said this many times on this show and i will

continue to say it the thing they care about is they look a higher 10-year rate than Greece does is, I mean, I can't come up with a better word than insane. But there's a reason for it. It's not insane in the sense, it's like totally understandable. But why? It's because the drachma or the euro is not the reserve. There is no drachma anymore as part of the euro, but the dollar is the world's reserve currency. And therefore, we pay for that

by paying a bit more, we have to pay a bit higher interest rate for it because people are watching what we're doing. And the other currencies kind of snake by because Germany has a lower inflation rate, lower budget deficits than we do. And Greece and Italy are along for the ride. The UK has a situation, not the reserve currency, but their rates are almost the same exactly as ours. And their inflation is higher.

And they're struggling also. So when you look at rates, you have to be cognizant of what you're comparing. The fact is Germany deserves to be at a lower rate than us because they have much lower debt to GDP, etc. Government's not quite as insane as ours in terms of spending. But we are literally in peacetime in what looks to be a good economy or at least a non-recently economy at, forget records. It's like we are literally injecting, what, a trillion dollars every hundred days into the economy? And where do you think that money is going? Well, the money will always go to the places where the money is wanted. I mean, even in the crypto world, I was looking today at funding rates, and I love watching.

I love reading this. I try to have to find the tab. But Coinglass has the highest funding rates and the lowest funding rates. The funding rates are about 0.025, which is two and a half times neutral, but still a third of where it was last week. The highest funding rate on Bybit is from slurf now if you're saying slurf where have i heard that before slurf is the meme coin that some num nuts burned 10 million dollars accidentally this morning so people are lining up to short the thing and therefore they're paying a higher funding rate so i mean you can't make this stuff up. I mean, this is literally the crap

that's going on. I mean, I've seen tweets from people saying, of course, meme coins are going up because you don't need to buy them on Coinbase or Robinhood so they can't turn off the buy button because you're buying it on DeFi. I mean, literally, this is the nonsense that's going on in crypto. But if you need to understand on the macro side what's happening is we are literally flooding the economy, the global economy with a trillion new dollars every hundred days. And so, yeah, the Fed could charge, you know, keep interest rates high,

but the people really care when you're putting that much liquidity in. Particularly when the people, when you look at it, the bond market clearly cares a little. I mean, the 10 market clearly cares a little. I mean, the 10-year is back at, what, a little over 4.3? I mean, there's no doubt that the government was preferred to be down below 4.

I mean, Mike, you were calling for it to go well below 4 a few weeks ago because it looked like it was going to. But I don't know. I mean, you know, that's really where the action is. And look, if it gets back up toward 5 again, there's going to be panic and they will be whatever they can. And what's interesting, and I'd love to hear both of you, is if the long bond starts going up, the 10-year starts going toward five, is the best move to make it to go lower cut or raise? And I don't know the answer. And it's an interesting question. That's why I'm curious what you guys think. Robert Leonardus Yeah. Before we jump to Mike, I just want to say the very fact that you can trade something called Slurp that was probably created this

week with leverage on a centralized exchange is highly problematic and is the problem with this market. You shouldn't be able to trade something that varies 30 to 50 percent in price any given hour with with high leverage anywhere. Right. Just shouldn't shouldn't exist. And that's that's I'm not saying that's necessarily unique. It is somewhat unique to us. And frankly, all this froth and stuff, it's had me selling a lot of things that are way up. Like you have to take profit in these markets. I own so many altcoins. Some of these things go up three, four, 5x in a matter of months. They might go up another 5 or 10 times. I literally don't care.

Like you take profit when the profits are given. I'm not selling Bitcoin, but there's a hell of a lot of other assets in this market. I do want to comment on that. I mean, I don't hold any of that stuff because my company facilitates active traders trading this stuff. And I can tell you that the volumes going through CoinRoute are breaking records month over month over month because we're adding pretty much any trades. The amount you trade, Scott, I've announced before that we're collecting games for a beta that we're going to launch for individuals.

I know how much we can save people when trading, but because of that, I don't want anyone to accuse me of trading on the back of what our clients are doing. Sorry, I see there's a lot of people who I know here. It's waving at people that go by at the conference. Yeah, but the point that I was trying to get at here is it's really a tale of two markets, and you see a lot going on. I mean, who wouldn't want to trade for the gold slurf? I mean, I'm not going to lie. I've been thinking, you know, I have a Jack Russell Terrier. I think they're cuter than Shiba Inus. Why don't we have

a Jack Russell Terrier with Yamaka or whatever, or hat or, you know, booties or something and make a meme coin. And who knows if they can retire off of that? What's building coin routes? Who cares? We can make a meme. I got to piggyback on that a little. A little lesson I learned in the trading pits and with clients is you don't mess with the market gods. If you don't give them a little bit of profits, they're going to rip your face off.

They don't need to know your position, but you got to give them some money to the market, particularly if you make easy money in trade. Now that's trading. The key thing I have to point out is I want to show you a chart, Scott. And it shows the difference between longer-term positions and speculating. And, I mean, I've been done both and still stick with just long-term stuff. And when you're speculating and you're wrong, you stop yourself out and you move on. Now, I've done that.

And that's what this chart reminds me of. James mentioned retail sales earlier. If you just take retail sales in this country minus CPI, this is really recessionary. It's negative. I mean, this is the latest data. I have to bring this up because I started publishing this chart, I think it was about eight months ago, and I've been wrong. Stock market broke out to new highs. I was right about some of the commodities

and gold but look at that i mean that's that ain't good yet we also have the thing is retail sales probably the weakest ever with fed funds still high and at some point they're going to go down but that's really bad it's just one of those things like as as um as dave mentioned people are using credit cards so i want to choose one other chart that, again, this is probably going into my file that's stuff that used to matter. It's the diesel demand. And I had to get a smile on it because diesel demand, it's the grease of the economy. I mean, everything that arrives at your home house now in a box, which I'll get into there, is just collapsing. So diesel demand has never dropped or been stagnant in our database going back 50 years.

It's the same level as it was in 2014 in this country. Now that's diesel. You're not replacing trucks with electric yet. I mean, maybe some of them, but one thing I also point out when I traded bonds, container boards were a big deal.

Corrugated boxes, everything you get in Amazon now, corrugated boxes that decline is as significant as it was during the Great Depression. Stuff that used to matter. And I'm like, yeah, I'm worried that once I have these little signals that we got that little gap in the S&P 500. We're getting overdone. And employment's ticking up.

It's all different this time. That's what I look at is, sure, this is a bit of the short-term hopium trade. It was wonderful. But, gosh, I sure hope all those lessons of history and all the stuff that used to matter don't matter. And that is part of the reason why gold's outperforming the S&P 500 since before hiking and again. But if you put gold in Bitcoin, you can't have gold anymore

without Bitcoin in there. It's just the way the world's going. Yeah, I have that gold chart right here. Made a new all-time high, obviously, breaking above 2146. That's retesting a support. But gold making this kind of massive move to the upside. But stock's still going up. What world do we have where everything's going up together?

Pull up the newsletter again, Scott. And I have a few charts in there that just show the liquidity in our system and where it's gone recently. And it's just if you want to understand why we're seeing liquidity, keep going down, keep going down to the last section. Yeah, keep going. Keep going. OK, right here, up the first one up a little bit right there. So there you've got the Bloomberg Financial Conditions Index. Mike knows this one pretty well. And look at where it is. I mean, it's about as high as it's been in the last 25 years, right?

It's right up there. And then you go to the next one, which is the, and this is just showing the ease of liquidity, like the ease of access of capital. And go to the Goldman Sachs one. And if that goes lower, it's good. So it's the same kind of trend. It's not quite as extreme. But then go to the Chicago Fed Financial Conditions Index.

And look where that is. It's clearly on a downtrend. And that's why the money supply hasn't been contracting. It's kind of been a little bit expansionary, you know, so that money is available to non consumers, you know, to consumers who aren't, who aren't looking for credit card debt, but capital is available for, for companies and businesses and, and and wealthy people. Yeah. available for for companies and businesses and and uh and wealthy people yeah there's another article closer to the bigot you are that that's where that's where the capital and that's what

my friends at the bank so you know all my hedge fund friends and stuff you say why do you make why do you guys make so much money because we're closer to it you know it's kind of always the answer i'm looking for the article that said that the dollar uh reserve status was in uh in question but i can't find it at the moment. I had it pulled up here. Yeah, I don't. I mean, I'm not. I'm not in question, but we are weakening.

Let me hear. Because David talked about this a bit. So, yeah, this is a good question for Mike. And we are seeing a divergence between the gold ETFs and gold price. Now, maybe some of that is gold ETF money is going into Bitcoin, but the reality is who's buying that gold? Who's buying the physical gold? And it's sovereigns. It's not investors, it's sovereigns around the world. And so is that impacting the US dollar yet? No, but they want to hold gold. Why do they want to hold gold? Because they know that our

inflation is sticky and they want to have something that will retain their purchasing power. They know that US treasuries won't. They hold treasuries because they need dollars, not because they want to hold their money in an asset or a security that can retain its value, retain its purchasing power. That's why they buy gold. It's three reasons, China, China, and China. I mean, you nailed it, but I enjoyed reading the Bloomberg article this morning about how Chinese citizens are now buying gold beans. So it's like they have to pay like a 10, 20% premium, but they want anything but what they're

getting. Gold what? These jars of these gold beans, little gold beans. It makes sense because their economy is imploding and it's just not known yet. It's not widely known yet, but you have to look at more anecdotal. But I want to go to the dollar once a little bit, because you pointed out how the U.S. is 100 basis points above the top four other four countries in the world in terms of their 10-year note yields. I mean, that's somewhat unstoppable. Yes, we have a debt-to-GDP problem, but we'll hash it out.

I mean, imagine you have much higher debt-to-GDP in China and Japan, and Japan might hash it out. But China, no, it's all President Xi. But I want to show – I got to show one thing when people talk about the dollar. If you can show this, this is just a typical coinmarketcap.com. And I had a conversation with, and it's one thing I enjoy doing in my condos. I meet a lot of very wealthy, somewhat retired people. And I have these conversations. A lot of them are the Western elite.

I want to say, well, there's one thing that matters. It's just sort of volume. The number one trade of crypto is Tether. And it's double the volume on Bitcoin on a typical basis, typical day. That's just an unstoppable force of technology. The world didn't have to go to that. It could have gone to the year. And it owns treasuries, right?

And it owns treasuries. So I look at this as, okay, the U.S. did what Churchill said. We came to the right conclusion. We're still beating each other. I don't want to say that woman's name. But if I mention Elizabeth Warren, Dave's going to just give us fire up on it. She has her own coin now. She has her own coin. It's Elizabeth Warren.

That's the point about this technology is most people don't get how significant it is. And if you can't have a view in gold without thinking about cryptos, you can't have a view in a dollar without thinking about cryptos because the world's gone to the dollar. Why? Because it's the least worse. You got to have a currency to knock around every day. It's never going to be Bitcoin. And then you have to have stores of value.

You can hold and transmit and transact and transport value. That's gold and Bitcoin. And then there's the stock market. Yeah. Yeah. I mean, on this point,

Mike and I agree completely. The funniest thing about Liz and it is i mean look we're faced with a simple situation either she's a lot dumber than we all thought she was which i don't think is the case or she just has an agenda and is pushing it and and is the cognitive dissonance is overwhelming now whenever i the cognitive dissonance is overwhelming. Now, whenever I say cognitive dissonance, it's for those who I haven't talked about in a while. That's the tendency of the human brain when confronted with the information that you are wrong to justify why you are right.

There's lots of famous examples of this, but effectively what it does is it causes you to twist logic, pervert perverted and effectively be dumb my favorite example of this is the is the chevy nova which is a was in the in the 70s was being the most popular compact car in america at one point and the marketing team tried to sell the chevy nova in mexico uh and there were three two spanish speakers evidently on the team, neither one of which were willing to argue with the senior people. Of course, anyone who knows Spanish knows Nova literally means no go. They tried to sell a car in Mexico called the no go. Not very smart, but they did it because they convinced themselves that they must have been right.

Well, Elizabeth Warren trying to fight the stablecoin bills and literally having Maxine Waters pull the plug on a stablecoin bill that was bipartisan and agreed to in committee was because she was like, oh no, we can't allow stablecoin legislation because that'll legitimize crypto and I

can't have that because it'll make my anti-crypto army look stupid. Except now that Tether is one of the largest holders of treasuries and bigger than most countries, actually. Now they kind of know, you know what, we really do need regulation. We do want people, as Mike says, to make the dollar more firmly entrenched in the emerging crypto economy by legitimizing stable coins. She'll be the last one to give in. But it feels like that actually has a real chance of passing because it is bipartisan.

It's just the extreme lunatic fringe on the left from Elizabeth Warren that's the only ones who are saying no to it. And so that really does matter because what happens if that gets legitimized? Well, then all of a sudden, now we have some legitimization of crypto. Does that mean that the government's going to support meme coins?

Of course not. But it does make it much easier to contemplate legit regulation and helping promote an economy that has all sorts of reasons that we want to promote. And we talked about that on other spaces. I don't want to go down that rabbit hole. But stablecoins are one of those things where only a fool looks at what's going on today and says, oh, I want to block stablecoins in the US because we don't want the dollar

to be the currency of crypto. Yet that is literally Elizabeth Warren's position that she has had. And she made the Biden administration pull the plug last summer. And the rumors are that the people, the staffers at least have figured out how dumb that is. Can I kind of piggyback on that? Oh, go ahead, James. No, no. I mean, look, they're just super short term view. It's a four year cycle. They're buying votes.

She's appealing to what she believes her constituents want and that she's the, you know, she's the champion for the little person and, and she's going to protect people. It's, it's, it's, it's ludicrous, you know, this, none of her, her intent or policy has anything to do with the good of America, has everything to do with whether or not she gets reelected. Yeah. Yeah. Well, Yeah. Well, let's piggyback on those comments and to the massive, overwhelming, big picture macro. What you just said, Dave and James, and mainly James about Nova, I grew up with that. I remember having, not driving one, didn't have one, but it's when you have an autocratic leader like you have with Xi and Mr. Putin, both presidents, you can, they cannot, it's impossible for them to get proper information because anybody

below them or around them knows if they don't say the right thing, they will die or something bad will happen. It's just the way things happen. Yeah, it's an exponential form of when you're in a boardroom like you. I mean, I've sat on these on these, you know, investment committees. And if you forgot, God forbid, you say something the managing partner doesn't like, he's going to, you know, embarrass you and destroy you and, you know, undress you in front of everybody. And so you don't want to do that. Yeah. That's my example from corporate America. Same exact examples. I want to point out, this is the thing that I was at the Greenwich Economic Forum last week on Thursday in Miami. And we had a discussion, having a discussion about China,

and some of those guys were bullish China. I'm like, you're missing the point. One key thing how China was bullish, China's overdue for a tradable bond. So just look at the Hong Kong Shanghai Index, the lowest since 1975 or so since the S&P 500. But look at the macro. This unlimited friendship completely shifted the global world order. Before we had some bad guys, Russia, we could do business with. North Korea, they're kind of dicey. Iran was kind of dicey. Now it completely solidified the axis of four bad guys. China

joined Russia, North Korea, and Iran, and the whole world is getting me out. That's good for gold. It's good for Bitcoin, and it's good for everything to do the US. It's not that. And the question is, where does it end? And that's why I'm looking at, okay, so we have the most of the world I'm hearing this, even from Chinese investors doing everything they can to buy Q's or buy anything that US-based. And then you have this thing that's in the middle of Bitcoin. So to me, this is the world order that the biggest shift could be maybe, maybe Z calls up Vlad, hey Vlad, you know, the limited, an unlimited friendship thing, it's not working, but that is a key risk otherwise this is going to continue and that is where bitcoin and gold come in the middle and i don't see to me that's

overwhelming macro and everything that sometimes paradigm shifts that this significant you don't notice when you're right in the middle and that to me is the major thing that's changing the world yeah we have a number of sort of i think i brought yours up let me bring mine up we have a couple james if you want to piggyback you you can go ahead and jump to something else. I just want to talk about Bitcoin, obviously trading around 68,000 ish right now. We saw a top near 74,000. Of course, anytime it drops a few percent, that means it's over. It's dead. It's going to zero, right? But we have still the sort of hyperbolic or larger targets. I don't think 80,000, when we've gone to 74,000,

I don't think the Biden CEO is saying 80,000 is a wild prediction. But of course, we have Standard Chartered now saying 150 this year, 250 next year. I mean, are we exhausted with the predictions yet? No. And I was going to say about what Mike was saying with Bitcoin and gold and Bitcoin's price. Look, Bitcoin,

it's kind of got a new dynamic, not kind of, it absolutely has a massive new dynamic. And that's the ability for institutions and registered investment advisors to buy through ETFs and for people putting their IRAs. It's very simple now. And it's actually super accessible for people. I want to own some exposure to Bitcoin. Oh, I don't have to pay seventy thousand dollars for a coin. I can pay, you know, fifty dollars for one of these ETFs. And it's a it's a major mental hurdle for them to get over. And so this is this is a really big deal.

But, you know, I don't know what you guys have been hearing, but there was a lot of talk around the street. And I've been watching MicroStrategy. I've owned MicroStrategy in my hedge fund. And I've been watching the premium of MicroStrategy of the underlying Bitcoin it owns versus the stock share price. And it's gone to, yeah, it's just stored. And so the rumor is on Friday, and I have not had this confirmed yet. I just want to make this very clear. I've not had this confirmed, but it would make sense to me. And I think Mike and Dave will, I want to hear what they have to say.

But it would make sense to me that there was a very large hedge fund who was doing the pairs trade, long Bitcoin, short MicroStrategy, and got bought in because they tripped their limit on the margin on the short side because MicroStrategy has blown up so dramatically versus Bitcoin on an underlying value basis. And so that spread blew out and a major hedge fund had to blow out of that trade. What does that mean? That means they had to buy in their micro strategy and sell the Bitcoin and they basically got liquidated, like we've talked about with large margin trades. Doesn't that mean that micro strategy should either drop or Bitcoin should now rise to meet somewhere in the middle? Revert to the mean.

Yeah, it should revert to the mean. And if it doesn't, if I'm Michael, I'm selling more stock. I'm selling more bonds. I'm continuing to add Bitcoin to my sheet. If people want to pay me to do that, of course, I'm going to do that. And to be honest, James, if you're looking at what Saylor did over the last two weeks, I mean, the 800 million convertible note in an immediately 48 hours later of 500, that would indicate that he was aware that MicroStrategy's price was flying for a reason that was not necessarily fundamental, perhaps technical, and that that was another opportunity to catch that mean reversion he saw this a million miles away like i i i when you talk to michael saylor like i personally struggle to keep up mentally he is i have no idea what he's talking about fast yeah it's like i'm i'm i feel like i'm i'm i'm working at keeping up just to

follow everything he's saying because he sees and his mind is clocking so quickly like the this is not that this is child's play to him he's like sure i'll do you know like he's not even he's got it all lined up and he's ready to go so i i gotta piggyback on that one so the first coming out global um thing we bloomberg did in 2022 was in miami and i had the honor of, it was me and Michael Strad, me and Michael Saylor in a room. I was there. Yeah, Scott, you were there.

That's right. We had drinks after we were great. And it was like the first big one that Bloomberg sponsored. And he's the best person in the world to interview because I don't have to say anything. Ask one question and you let him talk for an hour. Yeah.

And it's like, the history is awesome. So I had to show you the one chart because I think James and Dave, Dave probably thinks the first thing when I see a chart like this, I'm like, okay, I know for sure. Having covered these customers and having squeezed myself, it's classic. There's someone getting squeezed on that short. And we might hear the story later. But this is a long-term chart. It's in log.

Like I said, it's ready. It's a good history of pumping and dumping. I mean, it's been higher than it is now. It was up at 3 000 that uh in 2000 and it dropped to what five yeah i don't know why your chart shows that because this it was uh 1315 to hit a high here of uh 1800 1800 so so that should be higher i think on the right it's the current price now 16. uh because it just says it's just so yeah i can narrow it down your log chart but it just i want to show the history

of that so um yeah the first thing i when i see a chart like this like yeah but here's a lesson i learned in the trading with clients is when i can't feel sorry for people take excessive leverage and get and get hammered it's just welcome to the world of the big boys yeah exactly i mean we saw long-term capital management and we all experienced it, how painful that was. We experienced it in the tech bubble, the 2000 tech bubble. You know, I mean, I had someone, you know, somebody, a partner in my firm who shorted Amazon right through the top and got his, absolutely got his face ripped off because he was adamant that nobody was going to buy things online. They're not going to put their credit card online. And he was wrong. You know, he was painfully.

I mean, it was it was it was almost excruciating to watch. We were begging him to just stop out his trade and get his face ripped off. And I just. One thing I have to mention that we got to pass it Dave, is I've had two fathers of sons ask me. This is a show I never, who are generally well off, who own MicroStrategy, and they're worried that their sons own this stock and it's going up a lot. I'm like, well, that's a good problem. They're making a lot of money. But I've never had that happen with something like that.

Two different people in different parts of the world. Yeah, and I'm not saying anything fundamentally. MicroStrategy, he's got an incredible strategy of what he's doing. It's brilliant. It's gotten ahead of itself in my opinion. And I think he knows that. And obviously, like you said, Mike, somebody got squeezed. And I think going to bring a full circle back to what Scott was saying, I think that is where that cell pressure was coming from late last week. But let's face it, this is actually healthy. You know, it's not healthy for a stock to just go straight up every single day for security, for a store value, anything to go up every single day. It's not healthy. So to have a pullback for a few days, that's good.

It's a pause. It gives everybody time to, you know, sort out their books, figure out exactly where they are. And it forms a base of support where you have managers and come and say, okay, this is a really good spot to come in again. And then you can continue on your merry way. Dave, you're up. So a couple of things. First on MicroStrategy, I've seen some reasonable analysis which says that we're not even close to the highest leverage or the highest premium because when you take into account how much more he's been buying, understand that in some sense he's taken a, you know, he's basically, you know, imitating some serious form of flattery. If you go back in the history of Amazon, it's funny that you mentioned that, but that's what I was thinking of. Bezos, by taking advantage of the fact that Amazon had high volatility, was able to get incredibly cheap financing by selling convertible notes. Well, Saylor's doing exactly the same thing.

He's getting incredibly cheap financing to buy Bitcoin every time he does this. And so the premium is actually less than people think. And if you short it, assuming it's a static thing, like a closed-end fund, of course, you deserve to get your face ripped off. And any hedge fund that did that, that's Darwinism. Because if you ever read the Darwin Awards, that's the financial equivalent of the Darwin Award. And he's a Darwin Award winner for being dumb, assuming that Saylor could not continue to buy more on effectively by selling volatility in his own stock, which is what he's doing, which freaking brilliant and the hedge fund management side

is obviously as dumb as the idiots that were portrayed in uh in in in the in the dumb money movie uh you know whatever you know whatever i forgot the guy who's going to hill play but he got what he deserved and there you go so uh seth rogan the guy from Melvin Capital. Seth Rogen, right. I don't know why I always get those two actors. I love Ken Griffin and Stevie Cohen in that movie, by the way. They were both perfect. Well, but both of them were portrayed inaccurately. They were both portrayed inaccurately in the movie.

From what I've been told, the Melvin Capital guy, that was pretty accurate. And, you know, that's Darwinism too. It's like, yeah, you had everything and you lost it all because you were a schmuck and you bet more than you could afford to lose, which is always the, the anyone in a hedge fund by definition should never do that.

He did it. Well, there you go. Capital goes. The good news is that a Melvin capital had Citadel to in $3 billion at the end and turn off the buy button. So it worked out all right. Although Melvin did end up closing down. I will tell you that I do not believe that is true.

Well, the $3 billion capital, yes. The turning off the buy button, I will go to my grave not believing they did that because I know the people at Citadel Securities, many of them are my friends. It was Robinhood. Robinhood had to because they couldn't cover the orders. It wasn't that. What happened was what happened was somebody persuaded DTCC to put the screws

to Robinhood. And whoever that was, I don't know, but we'll never know that. But I don't think it's who we think it is. We're way off topic. The important topic here, though, is Bitcoin. And we've seen this movie before. Every time Bitcoin goes on an epic bull run, before that, there's somewhere anywhere from three weeks to six weeks to nine weeks to 12 weeks

of sitting in a range for the spring to coil so most of us kind of think the idea is sit in a range for the spring to coil and let price discovery happen what you're seeing now is class is different than in the past stuff every other time before this we we saw that. It was the hot money rotates out, the hodlers stay, and the price kind of drifts lower with not a whole lot of buying interest. Now, we're seeing people taking profits and to even stronger hands, namely the investors that are starting their allocations. And that's a big difference. That means that whatever happens when we get to the end of this particular range will be stronger than you expect because the hot money is already out.

And then all of a sudden, and the FOMO will start after we start running out of supply to sell to the people who are generally accumulating. Yeah, but what's important about that, Dave, is that it's not just FOMO. It's literally just we're onboarding institutions. They're like, well, we need to own some. Right.

That's my point. Yeah. I guess I wasn't clear. None of this is FOMO. We haven't even sniffed FOMO yet. Exactly follow we haven't even sniffed fomo yet exactly we haven't even sniffing people thinking about fomo yet this is the crypto wait the crypto the crypto degens are fomoing we just haven't seen institutions and retail fomoing to be clear because what's happening yeah but they're not following into bitcoin they're totally totally

separate markets casino yeah they're over inaming into Bitcoin. They're totally, totally separate markets. You know, yeah, they're over in the casino having their own party. Right. Well, one thing that's that's I think it's clearly reiterated this weekend was this is the number one risk asset traded on a 24 basis everywhere. I mean, there's just so many bots and algos trading in this and making a killing and some are getting hurt. The high on Saturday was 70. The low on Sunday was 64. I mean, that's just a wonderful environment

for traders where I came from where you always have to get stopped out. I love it. I mean, there's machines trading this 24-7. Yeah, I almost tweeted last night. I have bids way down on a ladder, you know? Like I got hit over the weekend. I'm like, that's great. I bought it. Yeah, the almost tweeted last night. I have bids way down in a ladder. You know, like I got hit over the weekend. I'm like, that's great.

I bought it. Yeah, the best trades always happen when you're sleeping, right? The ones that you set and forget about, and then all of a sudden you wake up and you're filled. You can do that. As a hedge fund, you can do that. Here's a stat for you guys. You've got to buy the ETF. So they're out buying it this morning at a higher price.

But as a hedge fund, you can buy it. I'm sorry, Mike. Your antidote is is great you're in the in the markets doing it you're one of the people i just expect is doing it so here's here's here's this here's some data for you over basically over the last year uh coin routes clients traded on the weekend. So maybe our average on an entirety of weekends, Saturday and Sunday, based on UTC, maybe we would have averaged over the past year somewhere between 150, somewhere around $150 million

in the platform on the weekend. During September, it was probably lucky on the weekend to get 100. It would spike up. We get some 200 or 300 million weekends. This weekend, this weekend, our clients traded $850 million to our platform. Weekend. Wow.

Yeah. What does that tell you, Dave? If you want to understand how much motion is going on that is apart from when you see these sorts of moves on the weekend, you know, Mike Alfred made the comment, well, Bitcoin's low volume falls are going to be reversed. And while I agreed with them, I was kind of scratching my head at low volume. I think what he meant to say is low participation. Right. But you can still get stuff done. And it's significant. And so Mike is right. The things that are happening right now is there's much more interest, there's much more brownie in motion in the marketplace, full stop. Mike, can I ask you if there's any risk to what Saylor is doing? People love right now, by the way, to point to the Hunt brothers. Anyone who

doesn't know the history, obviously, of silver, they leverage to basically get 25% of the supply of silver. People are saying that's what Saylor's doing. Dude, it's 1%. You can't compare the two. You can't compare the two. You can mine silver to no end. There's no

end to it. Go ahead, Dave. I'm just curious if there is risk to what Sailor's doing. Could I please answer this? Because I actually wrote a tweet storm on this when I first saw it. Whoever said this is a moron. Okay. First of all, two things.

Silver, the convention in the silver pits in futures futures even though at the time you were allowed to ask for delivery nobody did okay so silver was heavily financialized almost certainly people were shorting silver that had no ability intention or even thought that they might ever have to actually accumulate silver they would they were wrong they would just settle off the spot price but the hunt brothers realized was the first version first example that i i've seen in my professional career although it was a little bit before me i was in college at the time of what we call liquidity arbitrage and we've seen this now play out since then they said hmm i can buy physical silver make it very hard to find and now i could go and demand that people

deliver to me and they won't be able to. So they'll have to go buy silver. And there really isn't a very large silver spot market because the futures market is much larger than the silver spot market. Those dynamics do not exist in Bitcoin. Bitcoin tracks the spot price with immediate liquidations in the futures market outside of the CME. And the borrow market in Bitcoin is very well established. You can see how hard it is to buy. You can see where it goes. It's incredibly obvious. So even if he were 25 times larger than he was, it still wouldn't be the same kind of thing that the Hunt brothers did. Okay, I'll stop ranting and let Mike talk now. No, but they're great rants. Here was my take on it is when I first heard him, I think it was 2020, and he referenced a bridge built in Rome, in Italy by the Romans 2000 years ago. I'm like,

you got me. I'm such a sucker for history. And I think what's happening in this space, and part of the reason that helped take me really bullish Bitcoin then, and I actually bought some MicroStrategy and never touched it. What we do here is I just don't even want to look at it, a small amount. And I looked at it like, okay, there's a certain risk you want to take in life. This guy's doing something completely revolutionary. Dave and James, you might have to come back something, where he's actually taking his company that we know if you follow the rules of Jeff Booth and the price of tomorrow is probably going to be faded away. My technology is moving so fast and converting over to something I've never seen before.

And he's been able to do it and he convinced his board to do it. And I'm like, OK, well, and I'm sure there are some hedge funds who got caught the wrong way and bought the new ETFs and it didn't work out the right way. But I look at this as a stock that's like, yeah, I fully agree with what's happening with the technology as I show in the dollar. The world has just seen a newer technology and something that we've never had before. And he's willing to take risk on it in a big way. And I figure, okay, well, might as well have some of that. And I think that's what I see. It's that unique. I'm sure someone can dig in and say something like this has ever happened, has happened before, but not with a digital asset in a world going digital and being able to hold this asset with limited supply, increasing demand and being part of it. It's just like, okay, well, I think most people are saying, okay, what's the risk? He's not having some of it through his, through his stock market, his, his company, the way he's doing it. And he's, he's leveraging it and he's getting in and borrowing, the way he's doing it. And he's leveraging it, and he's borrowing cheap,

and people are letting him do it. And, okay, worst case, you get stopped out. So make sure you don't have too much money in the trade. It's a brilliant trade. It's a brilliant strategy. It's not even a trade for him. It's just a long-term strategy. It's smart.

He does what he says. The only thing I'll add is consider, just like people talk about the national football league or any other league whatever a team does that wins the super bowl it's a copycat league now consider that fasbi has changed and effective now this year every company can hold bitcoin in their balance sheet and get credit in their accounting for games. If you think there will not be others who are looking to do the same thing or at least some shadow of the same thing,

then there's a bridge that I used to be able to see from my old apartment in New York that I'd love to sell you. Well, it's like, what's the number one rule of a politician? Number one rule is to get reelected. What's the number one rule? Most time of a lot of people who run companies now is increase the share price.

Well, he proved there's a good way to do that other than buybacks and being a good manager. I mean, I'm not saying he's a bad manager, but this is another way to boost the stock price. And he's just did it in a big way. Yeah. It's impressive. I just always assume there has to be some guy risk. Right before we go, I just want to show you guys how awesome the Chevy Nova was. Oh, yeah.

Nice. I think it was awesome. I worked at a gas station. I do remember doing oil changes on these things. And that really inspired me to go to college and study real hard. They don't know what they were missing in Mexico just because of the name. That's all I'm going to say. That car was awesome.

Guys, this is an amazing episode. Absolutely love it. Dave, thanks for finding a corner in the Hilton. Seems one of us finds a corner at least once a month to film these last week. It was me. Always love this. My favorite hour conversation.

Guys, please follow James, Mike, Dave on X. The links are right down below. James, we highly featured your newsletter here. Everybody should absolutely subscribe. I assume it's below, but the link is on your Twitter as well, right? Yeah. Yeah. So you guys should all be doing that.

And I got to run. We got Twitter spaces, X spaces in 13 minutes. And I guess the party keeps on going, guys. Thank you so much. I will see you all next week. Bye.