The Wolf Of All Streets - Will Trump DESTROY Bitcoin Or TRIGGER A Massive Bull Run? | Macro Monday

Episode Date: February 10, 2025

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 ROUNDTABLE AND START EARNING CRYPTO REWARDS!  👉https://roundtable.rtb.io/shortUrl/KoFevDa ►► JOIN THE FREE WOLF DEN NEWSLETTER, DELIVERED EVERY WEEKDAY! 👉https://thewolfden.substack.com/   ►► Arch Public Unleash algorithmic trading. Discover how algorithms used by hedge-funds are now accessible to traders looking for unparalleled insights and opportunities!  👉https://archpublic.com/  ►►TRADING ALPHA READY TO TRADE LIKE THE PROS? THE BEST TRADERS IN CRYPTO ARE RELYING ON THESE INDICATORS TO MAKE TRADES. Use code '10OFF' for a 10% discount. 👉https://tradingalpha.io/?via=scottmelker  Follow Scott Melker: Twitter: https://x.com/scottmelker Web: https://www.thewolfofallstreets.com/ Spotify: https://spoti.fi/30N5FDe   Apple podcast: https://apple.co/3FASB2c   #Bitcoin #Crypto #MacroMonday 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.

By now, everybody is aware of Trump's pro-crypto stance, of all of his pro-crypto appointees, of all of the legislation and regulation that's seemingly going in favor of the crypto industry. But this could be in direct conflict with tariffs and trade wars, pressure on the economy that could cause risk assets like crypto to drop. So will Trump destroy crypto or trigger a massive bull run? Discussing this and much more today with the Macro Monday legends, Mike McGlone, Dave Weisberger, and James Lavish. Let's go. which I watched kind of on a plane and it was trash and not worth discussing. Dave, James, Mike, good morning, gentlemen. Macro Monday is 10 times the entertainment as the Super Bowl,

Super Bowl halftime show, Super Bowl commercials, all things Super Bowl related. You guys want to hear something funny? I was out running around yesterday and I realized that the Super Bowl had started. I hadn't even, I wasn't even – And I realized it was like, this would be a really good time to go to Costco. It was so empty. There were no lines. It was awesome.

No lines, but also no beer and no wings. It was so good. But no lines. I caught the second half. That's all I needed. It's funny because the Super Bowl usually used to be a blowout, right? So it just, I didn't expect it to be a blowout this, in this direction. Yeah. I don't think many people did. So listen, let's start

from the beginning as usual. Mike, what, what you got in the Monday meeting today? Was not really made too many fireworks fireworks too much, much different. I think it comes things from Anna, and Wong was quite significant. She pointed out she thinks the market's underestimating what the new Trump administration will do to lower yields. It seems they're focused. Besant and Trump have doubled down on that intention of lowering 10-year yields, less focused on the stock market than he was

past. One thing I did disagree with her is she thinks food prices are going to rise between things like oranges from Brazil. A lot of the food we get from tropical areas of the world, ivies, cocoa, oranges, coffee, have been spiking because of weather issues. If those transmit to the rest of the world, it's significant. But the thing about food in this country is we have a massive surplus of grains, soybeans, corn, wheat, surplus of energy. We've got to export it. If trade picks up, we're going to have those gluts developing. The thing we don't have a surplus of is copper, and that's been jumping up. But that's a key thing from Ana. Ira Jersey, our key thing, thinks the 10-year note yield could drop to 4.2%, particularly if that CPI is not too bad. But

overall, and Gina pointed out, earnings have been much better than expected, doing well. But the key things that she's worried about is there's two high expectations embedded in stock market prices, and the key weak spot she's pointing out is margins are deteriorating and price reactions are worsening as we hit these earnings focus. So that's the key thing from the Bloomberg meeting. And I think the most striking thing was what Ana said, that don't underestimate the desire of a Trump administration to get tenure yields lower, which has been one of my calls. And I haven't been right yet. That's interesting. That's interesting, Mike.

Scott, can you pull up the screen that I just shared? On the Bloomberg interest rate probability, it looks like we've got to go all the way out to September to get a full rate cut baked into the Fed fund futures. So that's interesting that she's saying that because you can see down here what the expectations of the terminal rate are, which is about 3.9% in 26. These are kind of outliers to me out in 27, but this is what it kind of looks like people are thinking it's going to be about. It's just about a 4% terminal rate for expectations. And so that,

that's, that's interesting, Mike. I'm not sure what you make of that. So I want to follow up on that. The one thing that I agree with, and I think the Trump administration is smart enough to do is take the pain for the gain. Get it over with as soon as possible. They know one of the best ways to get yields to go down is just a little bit of a backup in the stock market. Now, Anna didn't say that specifically, but she mentioned specifically Doge. Now, what we're seeing from Doge is I've been very impressed with. Stuff that I would think is when you start out at a company and you see they're melting cash or just spending too much cash, what they're doing is very impressive.

Caught off everything first and let people beg for their money back, let them figure it out later. So that's been impressive. But overall, what I've been looking for is that trade, the pain trade. Just maybe get back to a 200-day moving average, an S&P 500. It's been since, what, 2023 we've seen that? That's just the initial trade. It's the macro that matters. But that's what she thinks I think they're going to focus on, is get over the pain for the gain as you get to the, as you get to the end of the term.

Yeah. Because then you, cause then you can kind of blame it on, you know, the last administration, right? So, but here's another key point is that here's your 30 year mortgage. It's still up here at 7%, 6.93%, you know? So I don't know where this settles in, but if the 10-year settles in at 4%, I mean, these are staying at 6%, right? Well, that's my point. What keeps the 10-year note at 4%? What keeps the Fed from easing as a strong stock market? The number one factor, we need unemployment to go up a little bit, maybe we're doing a lot of government layoffs and it's also this negative sentiment for that but to me the number one factor for that little chart for that yield to go down is the

stock market having a little bit of normalization you know stuff that used to happen 10 percent corrections yeah yeah a little bit of mean reversion like you've been talking about what's interesting though is we got a little bit of mean reversion it bounced right back this is what what i found interesting this morning is all the the bluster again last night about tariffs right on um on steel well and aluminum the market kind of just shrugged it off right i mean if you're the the futures just kind of shrug them off. Right. So that's what's that's what's interesting to me is that it sounds like the market's starting to take like we had talked about months and months and months ago when we were talking about the possibility of tariffs and the and a lot of threat. And some of the market's just saying, yeah, it's just another threat. We'll see what actually happens. And the fact that they've already worked out Mexico and China for at least another month. So that's where those tariffs

would really impact mostly, right? So in Canada. Right. We have this headline, crypto prices slide as Trump announces new 25% tariffs on steel and aluminum. To your point, like that's yesterday and today we're going headline, crypto prices slide as Trump announces new 25% tariffs on steel and aluminum. To your point, that's yesterday and today we're going up, right? So the market is shrugging this off.

It's a great idea, but clearly it's just a Sunday and prices go down a little bit. And here we are with Bitcoin rising. I mean, we're trading, what, at $97.793 up. We had four days of literally having candles open and close within $150 spread. That was really insane. So I don't think the market, at least the crypto market at this point, is viewing tariffs and the tariff threat as a huge risk. Dave, I know you got a lot to say. Well, I mean, the market for Bitcoin, Bitcoin is in a 5% range. It's been in a 5% range, which is one quarter the size of the range that we lived through for eight months. We call that in the business of coiling

spring. The longer it continues, the bigger the move will be on the other side of it. At the same time, the entire crypto sentiment, crypto Twitter, everyone, whether it's Arthur Hayes, who's the lead cheerleader for Bitcoin and all of his minions and everyone else calling for Bitcoin to drop to 75,000 to get into an entry point, means money from the crypto world is sitting on the sidelines. That is the situation. At the same time, money from outside the crypto world is still coming into crypto and you're seeing people in the crypto world cashing out, looking to buy in later. That is what we call in the world, if it wasn't such a bad analogy in terms of human suffering, that is literally the same thing as

leaving dry brush underneath the forest, waiting for a match or a lightning strike or something. That is literally what you have going on right now. And just remember that I've said this multiple times, but that is exactly the setup. We've seen the great washing machine. I mean, Mike makes a point, which while I dismiss it and I make fun of him for it, has an element of truth to it, where he talks about 2.1 million Bitcoin wannabes. They're not 2.1 million Bitcoin wannabes or 2.1 million fricking lottery tickets that degens in the crypto world insist on playing in. And that is alive and well. I mean, we saw Dave Portnoy, Barstool Sports getting into it this weekend. Woohoo, Stool Presidente. Exactly. So what that is and what we've seen is all the lottery tickets in the crypto world taking a big steaming dump, sort of like Pat Mahomes did in the Super Bowl with his offensive line.

I'm not going to blame Pat, but I remember the last time I saw a quarterback who had zero chance in a Super Bowl was Pat Mahomes against the Tampa Bay Bucks. It was the same thing. I mean, literally zero chance. And, you know, the entire crypto market outside of Bitcoin over the last few weeks is down 30%. Those are nuts. That's not a small number. Bitcoin's down 5% in the same period of time. So what are we actually seeing there? What we're seeing, that great sucking sound is money being lost in the cryptoverse, in the casino that we know is alive and well. We know there's still money on the sidelines. At the same time, institutions are happily accumulating Bitcoin. Well, this is the setup that this is where we are. And so any kind of move matters. Yet we had one piece of news that I haven't seen a lot of people talking about, but it's a massive piece of news.

You know, did anyone read Hester Purse's, you know, 10 things? I should share screen here because this is. I can do it. I get it. We talked about it last week here. Yep. It is really important. There are things in here.

So determining security status, we know that matters. Effectively, what she's saying here, if you read the rest of it, is that it shouldn't matter. It's just who's going to do it. Understanding what is jurisdiction. Not acting. So no more lawsuits until we know. Making it possible for coin and token offerings to happen in the United States. To allow certain things to be registered.

To fix the broker-dealer path. To make sure custody can happen, to make sure staking and lending can happen, to open the floodgates to have exchange-traded products based on these products, to get rid of the stupidity in 70-year-old rules for clearing agencies and transfer agents that gum up the works. You can't have a conversation with a lawyer about these projects without about crypto, you know, at least five years ago or four years ago or three years ago without pointing them pointing out, well, you know, the rules on crypto and clearing and transfer agents get in the way of that because crypto doesn't need that because it's peer to peer. She recognizes that. And then the last one, which nobody's focusing on, but maybe the most important one in the whole thing, cross-border sandbox. This is a global market, and it is why crypto will win.

Every asset is going to go global. When Larry Fink, late to the party, five years after I said it, says everything's going tokenized, what does he mean? Well, he means it's more efficient, but he also means it's global and multi-currency. Anybody in the equity markets can tell you the following statement. People in the reader or watchers don't know this is true, but it is true. That the most complicated settlement systems in the world are the ones to handle U.S. and Canadian duly listed securities, which seems like it should be trivial, right? But what's so complicated about

that? Well, they trade in two currencies, US dollars in America and Canadian dollars in Canada. They're arbitrageurs that keep it in line, but the same security is fungible between the two. It's one of the only examples of that in the world. What is crypto? Crypto is fungible. You can buy something in dollars, sell it in yen, and it's the same instrument. Buy it in a stable coin, sell it in a different stable coin. Buy it in Bitcoin, sell it in all of that. That multi-currency feature opens up a global market. And here we have the SEC, the one that's been openly hostile to the industry, telling everybody

that they are open to this and want to try to make this work. If you are bearish on crypto projects that have real utility and you're bearish in Bitcoin with this sort of backdrop, I don't know. I can't help you. I just can't. You might be a short-term trader and say, oh yeah, the money flows are going to be bad. But understand that was the news this last week. So we're a macro show. That is a macro thing. That is a big picture thing. It doesn't mean it's going to go up tomorrow because it may not. We may be stuck in this range for weeks.

I don't know. Can I pick? Go ahead. Yeah, please, Michael. I also want to ask you a specific question about the meeting this morning. Go ahead. morning go ahead so um i want to piggyback on what dave said about coiled spring scenario and almost four decades ago i used that as a outlook for markets and things and i want to show a screen that shows the coil of spring scenario not uh the codex screen the only one that matters that's gold

by s&p 500 that's a 200 week binger Band. It's the narrowest in 30 years. It's breaking out to the upside. Gold's up 10% since Bitcoin reached 100 grand, the milestone, which I think put in a peak for all cryptos for a long time. As you see, Bitcoin's down a little bit. How much is Ethereum down, which is what I want to tilt over to? To me, Ethereum is indicative of those, I'm sorry about the word wannabes, but I'm up to a better one than that 11 million wannabes. But why would something like Ethereum that has massive, every time I hear about another better Ethereum platform, I think, okay, well, it's more likely to test 2,000 than sustainable 4,000, which means the

whole space is way overdone still. And I think, Dave, I really appreciate what you said about, you know, I think crypto people are focused a little too much on past of choke point 2.0. I agree you're moving forward. But what markets do is we all learn when markets put peaks, they put in pretty extreme peaks. But to me, this is the one that matters. It's that Bitcoin to gold ratio rolling over,

stock market being massively uber expensive, 1.63 in that 10-year note in China. It's only 300 base points below the US. The rest of the world's yields heading lower. And I still stick with gold. And I think it's going to be the better play than Bitcoin this year. And here's the breakout. This breakout is one key thing I'm worried about. It's really scary that it's just a little mean reversion up in that. It's scary. Well, gold is up 1.5% this morning. That's a move for gold.

Like that's not insignificant. And it's interesting. It is. It's completely breaking out. have for you, Mike, is what did your analysts and economists say this morning about the dollar, about the US dollar and where they think is going from here with rates and tariff impacts? Yeah, I was very good from our, I think some good stuff from Audrey Chilt-Friedman, our rate analyst. She thinks it's going to be hard to get that euro much below parity. What I'm sensing from her and a lot of analysts is they're underestimating the Trump determination on tariffs. Now, obviously, I've read a couple of books on that and I don't,

okay, he might be delayed a little bit. He doesn't even have his force in yet. And it's only been how many days? Maybe three weeks. It's just, I mean, don't underestimate this. And that to me this is something that's i like i mentioned i mentioned 30 years ago to tweak things that that brought out stuff that you know from people like me who've been in markets for a long time like yeah it's overdue if they just get the rest of the world to realize no it just can't have the same we used to say is you just can't you know the whole world wants free trade as long as they can have uh surpluses with the us he's. He's going to do that.

So that's the key thing about the dollar is pretty good dollar resistance around parity with the euro. But here's the bottom line. That's the key thing they said about the dollar. But I'll end with this, what Gina Martin-Adams said about the dollar. Since 2011, if you look at the trade-weight weighted broad dollar, not so much against the Euro, overlaid with the U.S. stock market versus rest of the world, it's tick for tick for, what, 14 years now? So when people imply a weak dollar, I'm like, okay,

well, what does that mean about U.S. assets in the stock market? You have to expect a divergence or they're all going to go down. And we're kind of overdue for just a little bit of correction. Yeah, that's interesting. Something we have also we haven't talked about that we should touch on at some point is, you know, Bessette talked about how he's going to move out of the treasury curve. He's going to start issuing longer dated treasuries, ones that actually have coupons rather than just the T-bills because we need to find demand for treasuries, which goes back to your point here, Mike, about global demand for dollars, global demand for treasuries. Well, I think he's quickly realizing that

it's going to be very difficult to move out on the curve, you know, without exploding interest expense and locking in interest expense for the treasury for a long time. And so this is an issue. And he, so in the last press conference or last report that he gave the press, I don't remember if it was, if he was standing in front of a microphone or if he just issued a release. But he said that they're not going to change their expected issuance of treasuries, which means that they're going to stay on the short end of the curve and keep issuing T-bills. We have $9 trillion of debt that's coming due this year that we have to refinance. This is a ticking, like a little bit of a ticking bomb. They can keep pushing it out. Right now, we're over the

debt limits. We can't issue more debt, really. So we're just going to continue to issue T-bills and refinance. I know, Dave, you're thinking about it, but we can't. We've just got to do extraordinary measures to manage the drawdown of the general account and do the best we could and can until we have an agreement. Do we know exactly what the, the debt that has to be refinanced at is currently financed at? I hear a lot of conjecture, but I don't know what the actual number is. Just think, just think of it. Every time a piece of debt matures, the, the, the investor gets dollars and they're gonna turn around likely reinvest almost all those dollars back into more debt i mean it's likely what will

happen so it's not a it's not as big of a problem as people um may believe because of that but what we're seeing what i just thought it was extremely interesting to hear after all of you know the talk about we to move out of the curve, we've got to move out of the curve, we've got to move out of the curve. And then suddenly the reverse repo is drained down. You know, there's I think about $100 billion or less left in it. I didn't check this morning. And we're going to stay on the short end of the curve. So this is going to get interesting. Where's that money going to come from?

And that goes back to Mike's point. Is this going to come from the stock market where people go into money markets? So James, could you expand on that? There've been a lot of people talking about the reverse repo and you're the first person that I know that's actually talked about that extensively. So a lot of people are talking about

reverse repo being drained and therefore there has to be some new place to get liquidity or the gears of finance could seize up. I think that a lot of us would like to hear, you know, once a reverse repo is drained, and for all intents and purposes it is, what do they do next? How would they refill it or what is the risk? Yeah, you've got to draw down on the bank reserves. The bank reserves are, I believe they're about $3.2 trillion. Correct me if I'm wrong, Mike, but that's where I believe they are right now. And so you've got hundreds of billions of dollars you can still draw down there, but those are bank reserves. They need to buy treasuries. They're not going to be buying T-bills. So that's where you go out on the curve a little bit.

But I think what the, so the reverse repo is just excess cash that's in the system. There was so much excess cash from the money printing back in COVID lockdowns in 2021, 2022, that the reverse repo got up to $2.6 trillion. That's just excess cash in the system that's being parked in money markets. And so money markets turn around, they buy the reverse repo because it's a very, very, very liquid overnight Fed window where you can take cash, get an effective treasury rate yield, a T-bill yield, and then it's overnight. It's an overnight commitment. So you can really move

around cash very easily. They love that. The second thing that the money markets buy are T bills. They love T bills because, and they'll buy some longer dated treasuries in the way they manage their liquidity. But by and large, they're buying T bills and reverse repo. So now the reverse repo has been drawn down because we've been issuing, the treasury has been issuing so many T-bills, they've been drawing money out of that reverse repo because it's just a little bit better rate than the reverse repo. And so getting the money markets by the T-bills instead, and then these are things that are just a few weeks or a month. And so the

liquidity is plenty for them. All right. So now you've got the money markets and T-bills. There's nowhere to get more T-bill money except other assets. And that's just the reality. Or you've got to print more money. But they're not doing that yet. We're still on technically on QT in that the Fed is allowing $25 billion of their treasuries that they own from QE to roll off and mature and they're not replacing them right now. So that's kind of what's happening. On the back end of the curve, the Treasury is doing something that their regular treasury buybacks, it's buying off the run treasuries just to create more liquidity. These are illiquid treasuries that are in the market. So if you're a bank and you're sitting on these, and we've talked about this before, Mike, with the big run, that big dot trade matrix run, if they're not on the run,

that means that they're illiquid. The treasurer's out there buying those to just keep the market liquid. Is that QE? It's QE, not QE. It's promoting liquidity in the market. That's just what it is. I think Dave's got something. I just want to follow up on what you mentioned, James, if I can just share screen a little bit. You mentioned bank reserves. I was just playing with the chart. This is a chart of bank reserves. You're right, about $3.2 billion. Trillion, trillion, trillion. Trillion, yeah. Sorry, zero.

But this is what sparked the evolution or the birth of Bitcoin. I mean, our data, we only started, Bitcoin was started trading at six cents. But bank reserves jumped up from zero to, we only started, Bitcoin was started trading at six cents, but, you know, bank reserves jumped up from zero to, you know, we're 3.2 trillion now and have they come back, they've come off 4.2 trillion, but, and then you overlay that Bitcoin was part of that life. Now we of course have 11 million cryptocurrencies, but I just want to point out to me how insignificant public debt is now compared to the stock market capitalization. Now we mentioned this before, we're basically about-year low. So what is the sore thumb in the space? Stock market capitalization has to keep going up. We're 57% of US stock market capitalization. That's total US government debt.

Now, yes, we all know it's run away. It's part of the reason some of us remain bullish gold, but it just means the elephant in the room is stock market capitalization. Or, or Yeah, okay, go ahead. I want to hear it. Go ahead, Dave, because there's, there's a very simple question. If you took both gold in the stock market capitalization and divided it by growth in in total in total liquid, printed dollars in circulation, whether that be m2 or M2 plus government debt

issued, how does it look? Because I think that it's most of that stock, I don't think the stock market's up at all during this period of time, nearly as much as a denominator there. And I think gold has been slow to move because of James' friend, Lawrence Leppard, who just has a new book that more or less says this, that the gold has been manipulated. And so that's why. And the manipulation is just failing now. And so expect to see gold between three and five thousand dollars. I'm wondering how much of this is just pure monetary inflation. You know. I always laugh at PhD economists saying the dumbest fucking thing they always say is like, oh, well, you could print money without inflation. There are tons of them. Well, no, that's not true. Every time you talk, Mike, every single time you talk, you're a walking

testimony to my point without a PhD, without even a master's in economics, just undergrad, that I can understand that when you print lots of money, you always get inflation. Milton Friedman was right. It's just that the governments have managed to push that inflation into assets, the most obvious asset of which the financialization of which is the stock market. So you and I agree on that. I just don't know how much of it is a reversion to a mean that you think that can never happen because we've had all this monetary inflation. That's the point that I really want. And I'm curious, what do you think? I know Larry would agree with me. I'm curious what you think, James. Well, James, why don't you answer that

question? Dave, you asked about overlaying some markets. So let's just overlay what's happened with gross money supply. This is a measure I've used for a while. Scott, if you can share that screen. Total, since the end of 2019, it's really, really mattered. As money supply has jumped 40%, and the total return to the stock market is up 102%. But you see that big breakaway, and we know why, because the government spent a lot of money. But the key thing I like to point out is the thing that always usually happens in history, when you have massive money pumps, massive inflation pumps, you usually go to a

period of disinflation or deflation. Now, China's doing that. That's my point, is we're still talking about 3% inflation. This number is still going up. So it's- Let's expand on that. Let's expand on that, Mike. And Scott, I've got a screen to share. This is Michael Howell's chart, and he does a little bit deeper dive on liquidity. I've always looked at liquidity on M2 and global M2 and all that, he incorporates expansion of debt, shadow debt, and then liquidity with the debt that is pinned to collateral, which means that the volatility of debt and interest rates matter. Okay. So anyway, what you're seeing here is exactly what you said, Mike, is MSCI, the S&P has just gotten away. It's run away from itself. It's gotten ahead of itself, right?

It's really moved above that mean of that expansion of the global liquidity, right? So if you then look at the global liquidity, it actually bottomed in 22. And so now we're seeing it rise again. So the question is, are we going to have a mean reversion where the S&P, the global markets kind of sell off here, or are we going to have a quick drive to expansion of liquidity to meet that mean? That's the question. And I think that we're going to have an expansion of money because of everything we talked about at the beginning of this conversation, which has to do with Trump getting interest rates down, the dollar being a little bit weaker, and the Fed coming off of interest rates and making it easier to access capital. That's my guess. But either way, when you take the liquidity into account, the 20 year history,

all the points that Mike makes, which are very valid if you look at it without, you know, based on inflation adjustments, but not actual growth and liquidity adjustments. It takes the extremes out. I and a lot of the people who, you know, the who laugh at the permabears that say that we're extended, extended, it doesn't matter. You know, they hang their hat on this. Now I'm in between the two. I do not. I am not a permable when it comes to the stock market. I mean, I think that a very narrowly focused, you know, I think the seven to put things in. And Mike is right and do not underestimate the point that he makes, which is without the wealth effect, what happens to the economy? Now, the leaders know this and therefore they are going to continue to create that situation and keep kicking the can down the road. The problem is what's fraying at

the edges and what is why gold is, I hate to say running. I actually think gold has been a beach ball that they've been holding under the water for a long time and they're starting to lose their grip on it. I think that's more interesting. And I think a lot of that upward thrust is going to end up finding its way into Bitcoin. We're talking about crypto now now we're talking about bitcoin and i think when bitcoin does break the range and the malaise in the crypto market ends etc uh i expect bitcoin to outperform gold but i expect both of them to outperform the s p over the the rest of the year and i think that's that's important because people think of it as binary. It's not a choice. There are N people in this world who buy gold as a safe haven, as a monetary asset.

It's why gold is more than double platinum. Actually, it's getting closer to triple platinum, despite platinum being 30 times rarer than gold, and generally throughout human history being more prized for jewelry and industrial uses etc what you're seeing is some people buy that there are also people smart people who are buying bitcoin for the same reason the difference is is there's no asteroid that could be mined for bitcoin and there's no the supply is just so much smaller than i expected to get very close to parry pursue this year. So as gold, what people need to understand is as gold rises, the intermediate top for Bitcoin rises at the same time, right? And considering gold's market cap is 10X as Bitcoin, every 1% increase in gold

increases the potential for Bitcoin to go up by 10%. And so that I think is what you're seeing. And so that's my bull case. I mean, people who say it, this is Dave and Mike arguing all the time. We don't disagree on the fundamentals here. We don't. Where I disagree is I think there's a lot more money and a lot less supply in Bitcoin. We're not talking about the rest of crypto. The rest of crypto is a different thing. The rest of crypto, I think you're going to see a rotation. I've been calling for it all year. You can play back the tapes from in November when I said that I think the theme that will eventually assert itself will be real utility will win out over means. But right now, it hasn't happened. No, they've all gone down.

And the problem is there. Yeah, but the problem is there. And listen, I don't disagree. I hold a ton of these tokens. I believe that these layer ones will all find product market fit and do well. But the problem is tokenomics and supply, right? So the problem is they're not stocks and finding utility does not necessarily mean that the token has to

go up if there's billions of them being unlocked onto the market every day that's correct i'm just playing i'm just playing devil's advocate but no no and we don't disagree scott yeah and you know as james always points out it's gambling but there's a reason that the meme coin casino is going crazy i'm going to bring this back up i mean for people who didn't see this i mean you got dave point portnoy literally pumped and dumped two tokens, admitted it, asked on Twitter if he's going to go to jail for doing it. And then is pumping a token called jail stool or something literally as a joke about him going to jail, right? You have CZ tweeting about meme coins. You have an entire African country that the Central African Republic that

launched a meme coin. This is where all of the money is. The money is coming into Bitcoin. The rest is going into memes. And it's going to be very challenging if it's institutional money coming into Bitcoin for that to find its way into thousands of new tokens that may legitimately have utility. I'm not saying it won't happen. I believe there will be alt seasons of a sort, but there is not enough money for everything to go up all the time. So people like lottery tickets. One of the worst jokes, because it's unfortunately true, is lottery tickets are a tax on the poor. Now, why is that such a bad joke? Well, because it's true. And what do we see in

the world of crypto? We see a lot of people buying things because they think that if they can't get 100x, it won't really matter to their life. That's right. And that amount of money is always going to exist. It's going to exist more in Asia than in the United States. But believe me, there are plenty of people that are DGENs in the United States that want to do that. And when you're playing with that kind of sloshing money around, you're always going to get a lot of noise out of it. Most of us in the crypto world believe that there is a lot of real utility and real value that's going to get created. It hasn't happened yet. And what we keep talking about outside of Bitcoin is what's that value? The only token that's really created get created it hasn't happened yet and what we keep talking about outside of bitcoin

is what's that value the only token that's really created a lot of value outside of bitcoin i shouldn't say only because i'll get you on that well solana and potentially you know solana because it's the casino the token that's most likely to create value outside of outside of it uh is probably xrp because of all the banking contacts and all the other stuff. And you're going to have Michelin and talk about it, et cetera. And look, I own both of them. I'm not going to lie about it. I've been very, very clear. When I won a lottery ticket, I was given for my birthday, let's see if I can get this thing you know yeah when you're done here's my lottery ticket it it's exceedingly unlikely to mine a block but if it does cool i get you know if if

it does then i get three hundred thousand dollars so you know how much ever a nerd miner cost is now a three hundred thousand dollar you know lottery ticket every 10 minutes. It's very unlikely to hit. I agree with you fundamentally on XRP's relationships. But what I've never understood, and this is not hate towards XRP, is that all that can happen without XRP token moving. This is a perfect example, actually, of what I was saying, which is that the value of the contacts and all those things on any of these networks utility doesn't necessarily accrue to the actual token. Well, yes and no. Ripple the company can do exceptionally well

and XRP could just languish or go sideways, right? Considering how- No, I want to be clear. I think most of the people in the XRP army on Twitter, the vast majority say things that are so dumb that it makes me want to ignore and throw hate and gasoline on the token and just say, you guys are a bunch of morons. I can't stand Colts and whatever. And that is a fact.

Mikkel, however, is not dumb. John Deaton is not dumb. There are a lot of smart people. And I went through the numbers and the numbers basically say that if they get the market share of getting into Swift or FedNow or any of the things, the probability, probabilistically speaking, if it gets there, the token will be worth between seven and 10 bucks. And if it gets more than one, it will be more than that. And so if you attribute a 50% probability to that, then I come up with a reasonable valuation right now, an expected value of around five. So buying it between one and two made a lot of sense to me, right? That's the way I look at it.

Now, note, I'm not talking about XRP eclipsing Bitcoin. Note, I'm not talking about XRP going up by a factor of 20. I guess anything can happen in a bull run, but I do see a base case there. And one could do Solana, I think I'm a little bit more bullish on because I do think that this casino will continue, but it will branch out into other things, other markets that it could be part of. And that does matter. So, look, you know, we could value crypto all day long, but on a macro show, what we really all need to acknowledge is we're living in a world right now where the president of the United States administration is operating at a pace that they've done more in three weeks than the Biden administration did in four years. And the best is coming yet. I mean, the things that are coming out are amazing. Now, do any of us believe that I think Doja is going to be successful in a lot of what it does, but the scope for what it can do can't stop money printing. We still have to grow our way out. And that takes time. And so anyone who believes we

won't have continued money printing, I think is delusional. But I also think it's delusional to think that they won't be able to eliminate barriers to entrepreneurship, which could cause growth. But that growth is going to happen slower, which is why read the body language and read the room. Everyone involved says you're going to feel short-term pain before you get longer-term gain. And that is what they're trying to do. And some of the stuff that's come out is insane, right? You know, people, the USAID stuff, that's insane. The one this morning that FEMA spent more money to house migrants in New York luxury hotels than they gave to the people in North Carolina. You want to get people mad? How's this for a stat? When's the last time a president had over a 50 approval rating well we got one now

and we got one who's arguably the most bifurcated politician in u.s history is over 50 percent well and think about just seeing him at the superbowl so that's a clever move the guy from a marketing standpoint is just the most clever person he gets that he's crushing it so you know i just have to bow in his general direction but it's the key points about you said the more pain the cane the pain for the gain we can't guarantee the gain and that's the key thing i'm concerned about is just the next trade i'm looking for is that pain i just look at the optionality of it so i'll just macro over to the macro i'm a commodities guy so this so far, WTI crude oil has peaked around 80.

Right now it's on 72. I don't think what stops it going from 40. And the number one thing that needs to just stay stable is U.S. stock market has to stay up. Corn looks like it might have peaked. Natural gas looks like it might have peaked. And we've got a lot of these positions got all along. The only one that's commodity, major one that's been going up is copper. It's actually beating corn, but that's because of tariffs that's u.s copper copper

and lme is at a 30-year low versus cme copper so from a commodity standpoint we're getting this little bounce people are excited about it and then i look over in china i'm like okay what's going to make things better there versus what's happened in japan in the soviet union 30 years ago it's all tilting that way it's just just what stops that. That's why there's increasing dependence on the US stock market. Sorry, I want to make a point. You just literally made my point for me. You have a president whose goal is to lower the inputs into consumer inflation, namely oil drill, baby drill, namely mine, namely produce all of that. He wants consumer disinflation at the same time he needs asset inflation. He won't say it, but he needs it and he wants to do it and he wants to unleash entrepreneurship,

which is code for make, you know, let people be willing to pay more for growth and more for multiples. That is literally the policy. And if he's successful and you're right, that he's successful, that he can push oil. You know, it's funny. I don't know if you've seen it. And remove red tape for companies. That's right.

Well, that's what I mean by unleash growth. But did any of you see the, there's a, I think it was Apple show called, or maybe it was Paramount. There's a Taylor Sheridan called Landman. Billy Bob Thornton has some incredible, you could find it on YouTube, just some incredible rants in there where he talks about the economy. And he talks about the importance of oil being in, and he calls it the sweet spot. His sweet spot is right where it is today. And his point is that if it gets too low, it turns the oil basin into a dust bowl and investment stops, and it's going to trigger itself for an inflationary coiled spring.

And if it gets too high, it strangles the economy, And that's not good because people can't buy it. I hate to say Taylor Sheridan is driving our United States industrial policy, but that rant was epic and true. Right. He nailed it. And right. But they have to do that for everything. Right. That's what's always been impressive to me. I would listen to James talking about the reverse repo, right? And all of the different levers that they have to pull to keep that sweet spot in every single one of these agencies and in the reverse repo, in the Treasury, in the Fed, in the stock market. And now we're talking about Trump needing to be in a sweet spot where he needs short-term pain with tariffs for long-term gain, but wants assets to go up. I mean, that is a challenging, challenging place to be. But Mike's made the point, and he's right. I need the markets to go up, but I need tariffs, and I need trade wars.

Energy is the core, Scott. Energy is the core. It is the key input that they can potentially move in inflation. They're not going to get unions. Consumer inflation. Consumer inflation. Consumer inflation. And remember, they're trying to engineer consumer disinflation with asset inflation. Anyone who thinks other than that isn't paying attention. And so I do think that's relevant.

I'm sorry. But, you know, and that's why it disturbs me. I mean, my brain can't handle paying, you know, generationally high prices for future discounted cash flows, which is basically boil down Mike's argument. It and I find myself agreeing with him. Yet I know that the system is rigged in order to get people to want to do that. But that's literally the world we live in, right? Yeah, I just think it's an incredible challenge that they have right now. And it's funny. I mean, we get these narratives. We talk about gold and we talk about Bitcoin. Just quickly, I brought this up before. Bitcoin lags behind gold as Trump's trade wars spurs safe haven demand. Okay. So everybody at Bloomberg or the mainstream media expects that

gold's going to trade, that Bitcoin's going to trade exactly like gold. But then when stocks go down and Bitcoin goes down, it's trading exactly like stocks. But then when stocks go up and Bitcoin goes down, it's not trading like a risk asset. Maybe Bitcoin just isn't digital gold as a trading asset, and it's not a risk asset as a trading asset, and it just trades on its own. I've said this over and over again, but it almost feels like a disservice to Bitcoin to try on a daily basis to compare it to the price action of gold or of stocks, when in reality, if you zoom out, it doesn't really follow either. You can be digital gold without the price moving with gold. Yeah, well, it's just one of those factors when you, Dave loves when you do your value

at risk model. But if anybody, you know, leverage beta is what I still look at Bitcoin is. I want to see it prove the otherwise. Anytime the stock market drops 10%, almost always Bitcoin drops 30% or more. And that's just the way it's been. You're seeing what's happening with the alts. You're seeing what's happening with Ethereum. You see, you know what, the rule is unlimited supply. Yes, I get the whole Trump positivity, but I want to tilt over to what

we were just pointing a little bit about energy, where I see the next big trade. I'll show you in this chart. You look at the average price of gasoline in this country. I wrote a couple months ago, I think it's going to two because it always has. And that's what I showed. That's the average price is 3.13. And I just the same exact chart. If you overlay with the U.S. Treasury yield, this is a 10-year yield. Look at that.

It looks pretty extended. Yet there's periods of time where they're basically the same thing. Then we'll just rope in the rest of the world. How about the world's second largest economy? We'll open their 10-year note yields, and they're collapsing. This is all on the same scale. So the key point is what stops this? What makes the price of gasoline go up? Well, that would probably be bad for Mr. Trump. So he'd do something about it. So I'm just looking for this little thing here. This is that US 10-year note yield,

which I think is going to be the next big trade. I've been wrong. Just drop down here, drop a handle, drop to 3%. And then we'll reassess. So what's going to take? Yeah, Fed easing, stuff like that. And that's just, that's one little 10% correction in the stock market. Stuff that used to happen. To me, that's- Ask yourself the question. I'm not disputing what you said. If you're right, then Scott Besant is hailed as a genius because he's cut 25% off of the largest single line item in the budget. And he's kept it that way for 10 years. If he's capable, if you can get drive rates from 4.5 down to three, and at the same time, take those trillions of dollars that need to be rolled over and put it into the 10-year,

he's a god. He goes into the pantheon of financial gods because that is exactly, that is the Nirvana situation. And trust me, if I'm sitting in his office working with him, which would, you know, he, I actually think by all accounts, he understands everything I just said and is trying to do that.

I would prefer for people like me not to say it because it's what they want to try to accomplish. That would be a, a, a magical outcome. That is, but, but that is what they want to have happen. Now, whether or not they're going to be able to do it is a different story. Well, that's the key thing I could point out. It's the cycle. Right now, you have to look historically, at least on a 100-year, 50-year basis, let's look back from the future. How is

the Trump administration going to be judged? By the level of risk assets in the U.S., it's really, really a bad time to be becoming president and say risk assets are going to make things better because they're so expensive already. You want to come just that they're just so expensive. And that's my point about what you said, Dave. I think they're just tweaking a normal trend for reversion that might not look so good for the administration, but all we care about is risk assets. We're here to make money trading and investing. To me, that's the key thing that's going to matter. The thing I enjoy is when we're going to make the US better when we're already the most expensive ever versus rest of the world in stock market capitalization. And we're only 20% of the GDP and we're only 5% of the population. It's kind of pretty extreme. Got to bring up a chart here. Talk about what Dave just talked about.

This is the sense issue right as the fed as the fed has eased yes a full percent the u.s 10-year treasury has risen by a full percent yeah so the the yield so this is the problem as you as you as he eases the, as the, as the Fed eases, the bond traders and investors realize that this could create more inflation in the future. And they're looking at just the sheer amount of debt that we've got to issue in the future. And they want to be paid a real rate of return. That's the problem. So even if the Fed does ease, it doesn't mean that the 10-year is coming down or that the 30-year is coming down and interest rates for mortgages are coming down. That's the big issue. Now, can I piggyback on that? Please, somebody explain to me how that's solved because- I want to be really clear. If you've been watching the speaking

over the last two weeks, you've not heard, here's what you haven't heard. You haven't heard Trump. In fact, disavowed it. You haven't heard cut rates, cut rates, cut rates. What you're hearing is we want the long end of the curve to come down. And we're going to take- You're hearing that interest rates are too high, not the Fed needs to cut rates. Correct. And so I often do the left-hand, right-hand nonsense, right? This is rates, but this is the liquidity spigot. I think what you're going to see, because there's no need, the short end of the curve is more or less where it probably should be. And what they want to try to do is bring the long rate down. And so they pretty much can't cut short rates knowing that there's a risk that it will have the exact opposite impact of what they want. The government

doesn't care about overnight lending from companies' perspective. What they care about is the fact that people can't refi their houses and take money out of houses, which is all dependent upon the tenure, not on the overnight rate. And that they have to refinance all this debt at higher rates. Right. They care about that. So you're going to see what I think is highly likely my scenario is the the the fed will do less politicized less less publicized qe of sorts in order to work on the long end at the same time that they hold

interest rates where they are claiming that we're in a neutral you're going to start seeing the language saying well we think interest rates are in a neutral not accommodative stance you're going to see they're going to jawbone it that way and then they're going to start working on the long end of the curve and at the same time hope that they can get enough public wins from doge to get people believing the u.s is going to be able to fix their problem which by the way they're likely to get and people might actually not do the math to see that it doesn't really matter if they can't hit the long end down, but that's the policy. It's like the old example, the old expression, we've all said it. I mean, Mike used to have hair before the first time he

heard it, which was don't fight the Fed. Well, what the Fed is trying to engineer is more financialization, less overnight accommodation, but really financing the deficit and financing the long end of the curve, which is what really matters. I think that's what you're going to see. The market is fighting the Fed. It's fading and fighting the Fed right now. It has been. But that's why I think we wrote this all in.

Let's wrap this up with one key thing. Besson's not an economist. He's a trader. And he gets it much better. Powell's a lawyer. And it's one thing you've always heard. Yeah, exactly. So he's a trader.

He knows as a trader, ex-trader, treasury trader. That's why he started in business. The number one factor now, and things we discussed a year ago, is, oh, if they ease, what's that going to do for risk assets? It did. And now what did it do for inflation? It's sticky. And now what's the Fed doing? They're stuck. And so on a one-year basis, gold's up 44%. The S&P 500 total returns 21%. I think Besset gets it. If we can just have that, doesn't have to go down, just kind of reduce that wealth effect. Bond yields are going to collapse because they already have in the rest of the world. And he knows the trade's completely in his favor. It's just how do you

tweak it without too much pain? And that's why I look at it every day. I think TLT is just a very nice positive returning put on the S&P 500 now. And yeah, I've been early, I've been wrong, but I was in 2006 and I was in 1999. But there is a scenario, Mike, where you're half right. The scenario where you're half right is that they get long rates down and there's a rotation in the stock market towards companies that have to finance themselves on the long end and pulling a lot of the exuberance out of the absolute high flyers where the market languishes, but doesn't rip up and doesn't collapse while rates come down. And that would be beautiful. So you're saying rates come down, but bonds could not perform well. Right. So the trade that I'm talking about is a world where

the Russell outperforms the NASDAQ, right? Or outperforms the high flyers. Or the NASDAQ rebalances because new high flyers emerged because of regulatory changes that allow them to emerge. To say this is steering an aircraft carrier is underestimating. And this is an incredibly complex thing trying to manage economies. And governments aren't particularly good at managing economies. Managing markets a little bit easier because you can kind of kick people in the right direction. And this government understands that they can't manage the economy. They want to unleash it, but they absolutely understand what market outcomes will be good for them versus bad, particularly in 2026. 2025, with all due respect, they don't give a crap.

They claim they do, but they don't really care about market returns in 2025. They care a lot about what's happening in markets and what people's perception is in 2026, because that's when the midterms happen. Yeah, this is the only time that they can allow the market to dip in the entire presidency. Right. So there's no market put on things, but markets do cause pain. Markets like to humble people.

Why? Because markets are trying to discount what will happen in the future. And so it's like, I always come back to the princess bride, right? You really can't choose the glass. The market is like, well, yeah, we know that they don't care about 2025, but they do about 2026, but I'm investing for 2026. So what do you do? I mean, that's the sort of crap that we have. But the key point here that Mike and I, where we agree is they really want TLT. They really want the long end to come down. And markets are looking at that saying,

okay, maybe they're going to succeed. And if they succeed, what does that mean? And I think that's a really important question for investors as you try to understand your portfolios. So the key question for that, Dave, is what if they don't succeed? That's my point is there's no option. If they don't succeed, then I think overvalued assets are going to be problematic. And I think you'll see that gold S&P ratio go. What I'm basically trying to tell you is your two trades are, let's say they hedge each other. Sell NVIDIA into the wrestle no no no no the two trades i i can the gold outperforming the s&p is far more likely if long rates don't drop that's kind of my point so i think those two trades together make an interesting portfolio because they sort of hedge each other yes this is a

scenario where both can do well i'm not, this is a scenario where both can do well. I'm not sure there is a scenario where they both do badly. So I think part of it, I think gold accelerates the outperformance of the S&P when long rates drop. So we have a great trade because what's it going to take for long rates to drop? Got to reduce the wealth effect.

Well, as we come to a conclusion, I just want to tell you what else has been a great trade, and that has been buying Bitcoin, right? And we have obviously meta-planted here up 4,800% since buying Bitcoin. That's Japanese stock effectively from a failed, I think he's a hotel company that decided to put Bitcoin on the balance sheet. You have Saylor once again buying, you have 22 states and counting now proposing the balance sheet. You have Saylor once again buying. You have 22 states and counting now proposing strategic Bitcoin reserves. You have President Trump's World Liberty Financial

itself creating a strategic token reserve as you see them buying up everything but the kitchen sink. I think it's pretty clear. And maybe this tweet actually is the best summary of it from Matt Hogan. There's an absolutely massive disconnect between retail and professional sentiment in crypto right now. Retail sentiment is the worst summary of it from Matt Hogan. There's an absolutely massive disconnect between retail and professional sentiment

in crypto right now. Retail sentiment is the worst it's been in years while professional investors are extraordinarily bullish. It's like living in two completely separate worlds. To me, that is the recipe for a massive bull run. A massive bull run. Because if the big money is buying and the small money is bearish,

they're just going to be the ones who catch up when prices are much higher. Yep. So, listen, we'll see, but I think that if Trump quote-unquote destroys Bitcoin or triggers a massive bull run as the title, I think it would be very short-term if it's down, but long-term

there's just too much fundamentally happening to push Bitcoin down too far. It would be that balloon being pushed underwater. Fully agree. Yeah. Yeah. So we'll see what happens, right? But I can tell you that these tariffs don't seem to matter much for Bitcoin, maybe for gold. That's all we got, guys. Macro Monday. Once again, we will be back next week at 9 a.m. Eastern Standard Time. James, Dave, Mike, thanks as

always for being a part of this incredible show. Guys, see you tomorrow, 9 a.m. Eastern Standard Time. James, Dave, Mike, thanks as always for being a part of this incredible show. Guys, see you tomorrow, 9 a.m. Bye. Let's go.