Unchained - Bits + Bips: Trump Won and the Question Is: Do You Have Enough Crypto? - Ep. 731

Episode Date: November 7, 2024

Donald Trump is headed back to the White House, and the crypto markets are surging in response.  This episode of Bits + Bips dives into what the election means for crypto, the potential crypto IPOs coming soon, why DeFi tokens are outperforming, and what changes in U.S. regulation could mean for investors. Ram Ahluwalia and Noelle Acheson join to explore this unprecedented moment in crypto and how inflation and policy changes may boost Bitcoin and the broader ecosystem. Show highlights: Everyone’s initial reactions to Trump’s win How some crypto companies could have their IPO soon Whether it’s time to take profits after the substantial run Why DeFi tokens have been the biggest winners  What the next crypto spot ETF will be and whether we’ll see staking rewards for ETH Why mainstream media didn’t see the Trump win coming Why Ram and Alex believe that Kamala Harris was not the right candidate How Trump won the appeal of the lower class in the U.S. Whether immigration was key to sustaining the GDP and avoiding a “hard landing” Crypto’s massive win in Congress How much impact Elon Musk had in the outcome of the elections How Polymarket has become a “new source of truth,” according to Ram Why the Fed doesn’t have a need to accelerate rate cuts Whether Trump’s policies will be inflationary and whether he’ll go forward with tariffs Whether the 10-year bond will reach new highs Thanks to Gemini for sponsoring this episode of Bits + Bips. Hosts: James Seyffart, Research Analyst at Bloomberg Intelligence Alex Kruger, Founder of Asgard Guests: Ram Ahluwalia, CFA, CEO and Founder of Lumida Noelle Acheson, Author of the “Crypto Is Macro Now” Newsletter  Timestamps: 00:00 Intro 01:57 Reactions to Trump’s election win 03:13 Which crypto companies might IPO soon? 09:28 Is it time to take profits in crypto? 17:30 Why are DeFi tokens surging? 20:31 What’s next for crypto ETFs and ETH staking rewards? 28:00 Why mainstream media missed Trump’s victory 33:44 Ram’s thoughts on Kamala Harris’s candidacy 43:52 How Trump gained appeal with lower-income voters 45:41 Did immigration help sustain GDP? 53:11 Crypto’s big win in Congress 56:53 Elon Musk’s influence on the election outcome 1:04:10 Is Polymarket becoming a “new source of truth”? 1:10:30 Why the Fed may not need faster rate cuts 1:13:26 Will Trump’s policies drive inflation? 1:17:08 Will the 10-year bond hit new highs? Learn more about your ad choices. Visit megaphone.fm/adchoices

I think this keeps on going till the year end. And one should be, the stress for people here should not be, are we going to pull back? But should be, am I long enough? Welcome to bits and bips, exploring how crypto and macro collide, one basis point at a time. I'm your host, James Stiefer, Tradfye Archmaster, Lord of Bloomberg Zen. Here with Alex Kruger, Kruger, Kroger Macro of House Asgard, Protector of the Realm. We're here to discuss the latest stories in the worlds of crypto. And macro news, just remember that nothing we say here is investment advice.

Please check untrained crypto.com slash bits and bips for more disclosures. Today, we're also joined by two people. First, Noel Blatchison, High Sear, and KroNow newsletter. Also joining us as Rahm Alawalia, maister of wealth, leader of Lumida. Today's episode is brought to you by Gemini, a U.S.-based crypto exchange built for new and advanced traders. Gemini is offering new customers $15 in BTC when they trade. Sign up today to earn your Bitcoin. If you want, Noel, why don't you just give it, for anyone who doesn't know you are, just give a quick background and who you are in 20 seconds, and then we can dive into this after Rom just his quick background.

Okay, 20 seconds. Good thing I'm Irish, because the Irish speak very fast. So here we go. I come from Tradfai, 13 years in Tradfai, 10 years in 13 years running an e-commerce company I founded, fell into Crypto 2014, worked for CoinDesk for five years, set up their research team, did the same for Genesis trading, left in 2022 to focus on what I really care about. which is how the crypto ecosystem is impacting the macro landscape. And that's what I do now. I write the Crypto is Macro Now newsletter on Substack. Yeah, that's good enough. Rah, why don't you give a quick background? I'll be brief. I'm Ram, Alawalia.

I lead Lumida Wealth, we're a private wealth management firm. We focus on cross-astaclass investing, work with a lot of exited founders and crypto natives, and been in investing business for a long time. All right. Let's get into it. Red wave in that election. Bitcoin pumping.

I mean, one of my takes that I've told most of my friends was that if Trump wins, we're going to take out the inflation adjusted all-time high in Bitcoin. And we got pretty damn close. I think the number 77, 78 would be the all-time high if you inflation adjust. Everything's pumping in the crypto world. I mean, honestly, my view is if you are invested in a stock or some sort of crypto and it didn't pump over the last like 24 hours, you should probably like reconsider or understand what's going on there. But I don't know what your guys' thoughts are before we dive too deep into what we saw.

Huge surprise. Obviously, a welcome surprise when it comes to crypto. We have to, of course, remember that crypto is not the only thing that voters care about, but definitely good news for the crypto ecosystem. Of course, there is the risk that crypto's expectations run away from themselves. You know, shocker never happened before because we're not necessarily going to get the regulation we are hoping for on day one. We're not necessarily going to even get it perhaps

within the first year. So expectations perhaps need a little bit of tempering. That said, just even replacing the chief of the SEC would be good enough. Yeah, we have a change in character and trend in the market, right? The market topped out after the meme coin craze and that was in the spring of this past year.

It's bottomed out and now we have a series of higher lows. So that is a change in market character. So, you know, you've got to approach this asset class differently. I think it's going to help names like Uniswap, for example. Imagine if you've got a token that can flip on the fee switch and you can issue a dividend to an investor or it can do buybacks. I think those kinds of ideas will work well. I think momentum assets will work well also. I think you're going to see the IPO market open up.

I think the IPO market just opened up today. The vibe session is over today, by the way, too. it's psychology. It's just psychology. At least it did for 52% of Americans, right? Because yesterday it was 100% in Vibe Session. Now it's 52% or not. And the IPO markets open up. I think we'll see Circle IPO.

I think you might see a chain analysis IPO. And that's going to be. Very quick question for you. When would you think, if you have any estimate of curiosity, I don't? You won. You think that quick. You are not sure. Sorry, I'm not sure.

The IPO market Q1, I think Paul-Weave goes public Q1, and that's relevant because they have a commercial agreement with core scientific, right? There are a lot of these Bitcoin miners repositioning as AI plays, and that's going to re-liquify the venture capital markets, both for traditional VCs, like let's say Stripe goes public, but also for crypto-VCs, we need to pay out distributions. And so that reinvigorates the ecosystem. Now, when that IPO happens, when it's time to look for the exit, by the way. Remember, Coinbase IPO April 2021? By the way, they were food to go IPO three days before Gensler took his chair. That was at the point where we all thought Gensler might be like a somewhat pro-crypto commissioner, too, remember. So things changed around it quickly.

Right. We thought he would, we thought we would bridge the gap and, you know, be Anakin Skywalker, and that did not happen. How nice would it be to have the market tall? of when circle IPOs. No, no, so later, later. We want it to be later. Not then. We also have to remember that if, and this is an if still,

if we do get some clarity over what kind of disclosures are needed for token issuance, then there's a different type of IPO market that can start to emerge. People actually going back to issuing tokens with the full disclosures, the rules require, to raise four innovative projects. Innovation got a very big bump. I 100% agree. You know, it's a fantastic point. Like, you can get a disclosure regime that helps investors make better decisions

people have been asking for. And, you know, now we can start tokenizing digital assets on chain and music royalties, which I'm very excited about, and start broadening the cultural relevance of digital assets. Fun fact, one of the number one or number two apps downloaded yesterday was Polymarket. The other one was Kashi. That's product market fit. And it's working the way it's supposed to. The end user doesn't even know it's powered by digital assets.

It's like TCPIP for the internet. And the irony is that it's an app that's used to, one, speculate, you know, on two, policy and regulation. You can't make that up, right? Talk about it. I have a feeling that was the peak, though, for a little while for both of those. Oh, yeah. The peak product markets that we might wait for four years before they top those numbers again. Yes.

I think you're right. You know, I got to say, actually, I think users knowing that they're dealing with crypto in the back end, It's, we actually want that to happen. Like there's a lot of examples where, where users are using crypto and they're not aware of it. And what happens is that money doesn't flow into the crypto ecosystem and it doesn't circulate. And it doesn't really bring much value. You can, you can even think of there's many cases of this. Like, for example, the famous Reddit NFTs on Polygon, they were quite huge and they didn't, they didn't do anything.

So this, I think we actually do want, I'm a stress. this because it's something that we say a lot in crypto that we that how great would it be everybody using blockchain in the back and not being aware. And I think it's the opposite. We want them to be aware and take control of those assets and have awareness. Fair enough. Fair enough. One other point should raise is like, look, you're going to get stable coin policy and regulation. And that's a use case that a lot of people can relate to. That bill has been installed. It's got bipartisan support. So I think we'll see that. And to your point, Alex, people on the front end at the app level will start to, you know, engage in these transactions.

Yeah, and the branding. In the end, it comes down to branding. I think you're right, Alex. I always was of the camp where we don't want people to talk about it. We just want them to use it. But the branding could certainly use a boost. But then the question is, what branding? Do we want crypto to be associated? Is it blockchain or is it digital assets? I mean, what kind of branding do we want? I like digital asset. You got to make this mainstream. I like that. That's the term I use. in a lot of my writing, personally speaking. But I also have a lot of more restrictions. Because it encompasses stable coins, yeah.

And then crypto will always be that you'll always have a fairly substantial faction that associated with the criminals and the fraud and everything, unfortunately and unfairly. But that is still the case. I mean, so then does Bitcoin become a digital asset or is it a cryptocurrency? All of the above, in my opinion. I think it depends on the audience. I actually am very attached to the world crypto.

And, yeah, TrotFi and politics, you say digital assets, that's the brand. But you turn around and you talk about crypto. There's a lot of things that happen there. They're not really suitable for traditional finance peeps, right? Yeah. And also crypto does still have the privacy connotations that those of us in the industry care about. Yeah. I mentioned, like my expectation was the Trump win, like I said, the inflation address in all-time

short term. That's a very short term thing that I thought might happen. The question is, I mean, the market cap of Bitcoin went up like over $100 billion in less than 24 hours. I can't really talk about like tactical moves, but I know Alex Ken and I know Rom can and I'm assuming Noel can. Like, do you think this is a near term top? Are you selling some of this? Or did you go leverage long into this and take off your leverage? Like, what's your view? That's the first thing actually, when I want to like stress on, I see a lot of people already talking. about getting out of the position or, oh, it ran too much and going to short. And a lot of people really talking about taking profit or concerned that price didn't run up

enough. Come on, it's up 9%. What do you expect? Yeah. And it's just wrong. It's like I've been talking about this all night. In fact, I haven't slept. What?

And this is my ecstatic phase. It's like I'm actually quite ecstatic, but, sorry. You're doing pretty well for someone who hasn't slept. That's amazing. That's when I have a very bad trade and I have to break. So there's two ways to think about it. I think that are very fundamental important, and this is really important at the beginning of a trend like this.

One is from a technical perspective, we have actually the longest range in, for us, forever in Bitcoin. There's a range, which means very well-defined range, and which means basically people, when you break the range, they're turning their hedges on and put positions on

on the upside, and same on the downside. And we broke to the upside. So when the longer the range, the more one should expect price to run in the direction of the breakout, in this case, higher. That's technically. And fundamentally,

this is a systemic change. This is really, really fundamentally an important change for Bitcoin. They're talking about Bitcoin as reserve asset. They're talking about even just the mention of this is talking about no taxes on Bitcoin in the US. Yeah, probability that happens within the four years is like 1%. Point 1% doesn't matter. It's being discussed. It's insane. And the regulatory front, we're going to see a lot changes coming through, it may be slow, but it's still a massive fundamental change. So we have technical fundamentals, which is this is the place where at least in my book, you let it run. And if you're wrong and you round-trip the whole thing, well, too bad. Shit happens. You know,

it's sometimes things go wrong. But that's the play right now is just keeping the reins. what you guys think. There is also the, as I mentioned earlier, the risk that we're over expecting the regulatory changes, but longer term, totally agree with you. We're overlooking the macro implications here at Trump presidency is going to be

more inflationary than we are probably priced in right now. Tariffs are inflationary. Deporting immigrants is inflationary because the impact on wages. Tax cuts are inflationary. So the expectations for rate cuts will adjust. That could also cause some putting a cap on the on the run but we're looking at increased spending especially if the republicans

get the Senate and the House we're looking at increased spending we're looking at accelerated currency the basement we're looking at inflation coming back and that's the macro tailwinds for bitcoin which are going to be very material yeah I agree with a lot of the comments there I say look the trend is now up and this will continue until we get an event or set of events where you get peak enthusiasm and that's ahead of us. Markets have things to look forward to. So it's very tactically in the short term. That's much harder to call.

What I do is I have a daily process every morning. And my team and I, we look at how folks are positioned. For example, looking at options data, for example. So I'd want to look at that first thing tomorrow morning. So we did that this morning. We could clearly see people were wrong way positioned. I did a post two days ago. and again yesterday saying that you don't want to be hedged and you want to be long.

And, you know, that's how we are positioned. And so assets are re-rating because of that. But, you know, it's important not to feel the FOMO and just like plunge in the fire if you missed it. I've never seen an asset that doesn't give you another entry point. People are talking about copper. Copper is like down today. Okay. Gold is down today.

So, you know, there are. other entry points that will present themselves. There's a lot of excitement. The other observation I will say is that there's this concept or it called the hotball of liquidity. And what that means is markets will re-rate very quickly, reprice, a lot of enthusiasm. A nice parabola shows up. You saw this with China when David Tepper spoke on CNBC. He saw this with Ethereum in May.

You've seen this in uranium stocks just a week ago or two weeks ago. and now uranium stocks have kind of tumbled out. So the average window of time in which this run-up takes place where that peak enthusiasm, everyone's trying to get in the market, is around one to two weeks. That's an interesting rule of thumb to have. Now you get adopted for the local situation too, right? So I don't think this is a two weeks,

probably a little shorter than that in terms of the kind of the near term rally because it's so, the mission of force is so significant. It's pulled forward a bit of that. So, I mean, I don't know. If Trump does even a fraction of the positive things he's saying he was going to do for the space, he's four years in office, he puts somebody who's pro-crypto actually makes some rules, set some guidelines for what these companies should and shouldn't be doing. And I do think, no matter, even if Trump's in office, there are going to be rules that come out that this industry is going to be unhappy with. But I still think it'd be better than the unknowns we currently have. So I don't know.

There's a lot of, honestly, even if they just stop doing all the negative antagonistic things that this current admin, the one that's on the way out was doing, I think it's a net positive for the space. So I mean, it just the positive price momentum makes complete sense to me, no matter how you slice it. I don't think, yeah, it should. So near term pullbacks maybe, but long term, it looks extremely positive as far as I'm concerned. I think medium term, medium term up. It's funny, I had a dialogue with an entrepreneur who won't name that person, but the person said, look, I want to build and not have to call my lawyer. That's one. And you think about the dollars lost on lawyers and responding to enforcement inquiries, it's been significant without having interpretive guidance from the SEC, meaning there's no rules of the road that have been published during this entire SEC administration while they're claiming that there's clarity.

It's so, yeah, I think you're going to see more innovation, more app development. It's an exciting time. And the, if I may say, marketing factor of all of that, if we start to see some of the worlds and the processes being walked back, some of the outstanding lawsuits being walked back, that's low-hanging fruit. That makes headlines. That gets people interested in crypto. If Ross is freed, that makes headlines.

That gets people interested. There's going to be a lot of mainstream interest because of what they're seeing across their feeds as well as because of the dialogues that they'll be having with their friends and family. Yeah, you talk about lawyer fees. I mean, I've read more legal documents in relation to the Bitcoin and Ethereum ETFs. I mean, the lawyers are just raking in cash on what the government is doing right now. I mean, they rail against the government, but they are definitely raking in cash with what they have.

But that's about rulemaking. And something we've been saying on this podcast for months, the Trump win is more positive for defy than it is necessarily for Bitcoin specifically and some other things. And the price momentum we've seen over the last 24 hours proves it. I mean, you look at, you look at ABE, you look at Uniswap, you look at Lido, you look at Athena, you look at all these other like truly defied, decentralized finance type applications using cryptocurrency or blockchain. And they're up 20 plus percent in many cases over the last 24 hours, which to me makes

a lot of sense. I don't know if you guys have like more complex thoughts other than the fact that it makes sense that they're rallying as much as they are. It's a great point. It's a terrific point. Bitcoin is a commodity that's settled. So changing the SEC really doesn't impact Bitcoin as much. It does help on the banking side because banks can interact with digital assets and custody

and serve as a distribution layer and use it as a form of settlement. So there is value creation on that side. But to your point, like in my mind, the two highest use cases for digital assets are one tokenization, stable coins are one instance of that. But the second is defy, right? The ability to have trustless settlement with a counterparty and borrow lend on chain. That's what banks were created for. And to be able to do that without having to have a trust requirement where you can see the entire ledger and balance sheet on chain and create liquidity on a smart contract that you can audit.

I think that's very powerful. And that we have not seen the full potential of that innovation. It's an innovation that I would actually put the level of civilization level innovation. because prior to that, it was banks for millennia. Borrow short, lend long, take deposits, custody, fractional reserve banking. You got to hope that people don't show up at the same time. This is an innovation that would not be possible without digital networks and cryptography, private and public keys. It's something that can only arrive in the modern era.

So, yeah, I agree. I think that's very encouraging. I mean, if you think about the 2008 crisis, one of the reasons why, I think, I think, I'm excited about digital assets. I was at Merrill Lynch in the 2008 crisis. I lived at 45 Wall Street, and we saw these banks blow up because they had illiquid, opaque securities. No one knew what the value of these things were. No one knew what were in the bonds. You know, think about the scene from the way, the big short where Michael Burry's crawling on the floor trying to forget the FICO score. That's the world we still largely live in, by the way. We still live in that world. And you can move to a world of more transparent. more liquidity and less counterparty risk. Especially if you get the cross-border transfers smoother, especially if it becomes easier to spin up new markets

in places where they don't have the current infrastructure. Imagine what that will do to the distribution of savings as well as unlock the financing of innovative projects in areas that currently don't have that kind of activity. But another thing to think about is, again, what kind of products will we see emerge? I imagine, James, you have a lot more coming your way in terms of ETF legal documents, because the question I've had many times today is what's the next ETF that gets approved,

assuming there is a change of regime at the SEC, which is safe to assume? Is it going to be another crypto asset such as Seoul, or are we going to see the ETFs, if EFs allowed to distribute Staking Awards? I would bet we see some sort of formal process start. So right now we have applications out there for Seoul. E, I mean, sole ETH, soul, E, soul, ripple, light coin, actually,

there's, there's an application, there's a live application from the hashtags that I assume will be approved at some point in the very near future for the holds multiple coins. But yeah, I think we're going to see those single assets. We also don't have in-kind,

create, redeem on these ETFs. I'm expecting that to happen within a year or two. I mean, no matter what, even if they replaced the SEC commissioner, I mean, I don't know, remember exactly when Gens are, came in, but it was like June of the year. So like we could, even if Trump moves as quickly as possible, like the SEC isn't going to get a new commissioner for eight months from now, potentially.

I mean, theoretically, you can get an interim one. Maybe that test of hers, who knows, but they're not going to do any like huge, big movements I wouldn't think based on how I know things operate. So, yeah, I don't have big thoughts. I would say Salon, it would probably be the next ETF to expect. Salon and Ripple. Some of the considerations are, one, you know, the surveillance rules, right? That's, you know, do you have another exchange on the derivative side? And Solana doesn't have a futures contract yet. I expect we'll, you know, see that.

The problem is that's not technically required. So that's just the precedent that this SEC admin and the prior SEC admin has set. And really, there's no like SEC ruled, official rule that says this is he's, happen, it's just been precedent for them approving things in the past. And theoretically, if you just, like, there's plenty of commodity ETS that have been approved in the past that had nothing that would satisfy that. We have, we have Vietnam ETS where you don't have surveillance sharing green over like the equities that trade there and things like that. So there's other things that happens. So theoretically, it could happen without that. But even still, even if, even if,

say, comes in in, I will call it April really early or May, and somebody decides the file or somebody even files like next week. You've got 260 days before you even get an approval. So like we're talking way out into 20, we're looking into the second half of 2025 before any new ETFs launch. And that's assuming there are no roadblocks held up, which I wouldn't count on. So it'll happen. It's just, I don't know exactly when. It depends how aggressive and things move, I guess is what I would say. Yeah, Solano's next in line, then. We should have to be plenty of time for front running, basically. That's true.

Would it need new regulation around the definition of whether Salana is a security or not? And I think what, I mean, right now, if you look at it, the SEC and the CFDC have been infighting over this exact topic on every different digital asset out there on whether it's security or commodity. And maybe you get like actually somebody in there that's not being, you know, isn't on a leash with Elizabeth Warren being told what to say and what to do and how strict to be about like what this things are. and you can get some rolemaking. I mean, there's plenty of proposed bills from the legislative brand. So you look, you know, the Republicans are going to have the Senate again. All of a sudden, you get some sort of like market structure bill that delineates what's a security and what's a commodity.

You get some rulemaking. Like there's a lot of things. It's just not something that's going to happen immediately. Like I feel like some people think like Trump's going to come in on January 20th and all this is going to be done in like two months. Day one. Day one. But even day one.

But that's not the way government works, even if, even if you have. have Elon Musk and Trump running the government. Yeah. Yeah. And getting that regulation through will take a long time because they're going to have a lot of other things to worry about. And one thing we saw with the Supreme Court, I think it was this year, wasn't it?

It decided that the SEC can't make sweeping rule changes. So even if we get Hester Pierce on day one, hopefully, she probably would have her hands tied as to how much she can change. Again, just getting some of the current actions off the table, that would be a good enough start. Chris Giancarlo could be the new name. Chris Giancarlo, former CFTC commissioner. So you need someone like that that understands the commodity side,

as well as the security side and digital assets can interact with policymakers. Like that would be one of the home run picks. Yeah. I've heard Heath Tarbert is a frontrunner as well. And he's now at Circle, which would sort of close the Circle, if I may, as to bring in stable points into the regulation. I mean, Front Fat Gensler, did run the CFTC back in the 2000s.

So he has that experience you wanted. Be careful what you wish for. Well, I mean, it's a squanded opportunity. As you pointed out, James, I mean, the issue that the DNC is facing this morning is that essentially their messaging in part and policy certainly was captured by the progressive wing led by Elizabeth Warren and the anti-crypto army. And that did not play well. By the way, it's broader than digital assets.

You know, it's true for the banking category small. There's a lot of folks that, you know, clearly, like Trump won the popular vote, won the popular vote, not just the electoral college. So the DNC failed to read the room at a very fundamental level. And there's an interesting question around, did the media believe their own stuff? like what happened there? How did those bubbles pierce? You know, so I'm curious to your take, James. What do you think happened?

Yeah, I mean, I 100% think the, you know, the mainstream media were buying their own. They were, I don't know, they said everyone on Twitter was in their own bubble. Stream media was in their own bubble. I think a lot of the mainstream media types tend to be, I mean, you live in New York City, you live in Washington, D.C.

Like, you're in all these, like, more liberal, progressive states, and you're around all the same people. Many have master's degrees in journalism. And you have like a very similar background. And I feel like this is, I'm not the first person to say this. The mainstream media is just kind of out of touch with like everyday Americans for the most part. And it's pretty clear that that's the case here.

I mean, that's my personal view. I think it's absolutely true. Also, the mainstream media needs access to the establishment. That's where they get their interviews. That's where they get their stories. That's where they get some of their advertising dollars. They need that access. And that is what closes them off to what's going on.

That also is what makes them very eager to drink the establishment Kool-Aid that they're handed. And I think Romraise is a really important question. What happens now? Do we start to see bankruptcies in some of the mainstream media organizations as advertising revenue dries up? What happens to the very well-meaning journalists they have working for them? Does this lead to an explosion of creativity

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You know, I do want to say on this, I think it's very, very important. And I want to link it back to what we were talking about at the beginning. The market were pricing in somewhere around 50-50. It was a coin toss. It was not just, the crypto guys were way more bullish, was not 50. 50-50 for us, but for everybody else was 50-50, which means positioning was 50-50. A polymarket was more. Polymarket was...

Polymarket, yeah, that's us, right? That's a point. Maybe it's not, though. Maybe it's the other crowds. Maybe that's global crowdsourcing. Maybe we underrated polymarket. Polymarket, even last night, was sniffing out the election for Trump while the media had not been polling elections.

Let's say, well, 6040 or 62.38. Let's say you're right. I think you may be right. I would lean in between because it's a very liquid market. But let's say you're right. And we had something pricing of 6040. What that means is that a systemic change doesn't get priced in overnight or in my humble opinion in two weeks. It's too big. That's why elections are very, they're not a Bitcoin ETF. They're very hard to price in. So I think this keeps ongoing till the end. And one should be, the stress for people here should not be, are we going to pull back? But should be, am I long enough? I agree with that. That's, I think that matters a lot. Yeah, I agree with that too. And again, it's not just the regulatory overhang being lifted.

There's the macro considerations, which we have not yet meant, we have not even got a glimpse of what's coming down the pipeline there. So this was meaning to the media thing, right? Like I agree with what you guys were saying that there's some sort of award talking about this before we started the stream, by the way. That it's kind of like not only that they push in some times, in some cases, some people in the audience are going to push back. But they push a false narrative. But it's also the fact that many of them actually, they believe what they're saying. It's not just all make-belief. they already made themselves believe.

Yeah, and they're well-meaning. They're not bad people. They just drank certain Kool-Aid and convinced they're right. Yeah, I agree. Look, there's a general anxiety that's been hanging over the population, that term of art that's being used as vibe session. I think we're actually in Goldilocks economy. That doesn't mean that there aren't challenges.

It doesn't mean inflation isn't going higher. It doesn't mean that people aren't working two jobs. But Goldilocks doesn't mean that. Goldilocks means our earnings going up. at the consumer level, the corporate level, it's your access to credit, is the economy growing. That's what Goldilax means. And that's constructive for risk assets.

And now you saw the VIX melt away today, several points, been elevated at the 20%, 20 level for weeks, despite indices being near all-time highs. That anxiety is melting away, right? The clouds are lifting, the blue skies appearing, the rays of light are shining down. So I agree. I think overall, you know, leaving aside the near-term kind of tactics, this is a risk-on environment, you know.

I would say the Mr. Market was sniffing out this window. Financials were up yesterday. Before the election, every category of the market was green. The dollar strength was showing dollar up is a Trump bump phenomenon. Financials is squarely Trump because financials and banks have less regulatory capital requirements under a Trump regime. It's a highly sensitive. Look at Axos Bank. That's the bank that were Trump banks, up 20% today, by the way.

But other banks yesterday and Monday were also going up. I bought Flagstar Bank. That's run by Steve Mnuchin, former Treasury Secretary of Trump. That was my kind of Trump play there. So, yeah, the market was sniffing this out. And I believe the DNC just failed to read the room, didn't understand reality. My speculation is that after Biden had the, terrible debate with Trump, and this is an anecdote I've heard from someone in the kind of

DNC circles, might be up or might not be, but it kind of makes sense to me. They say, look, you can go out the soft way or the hard way. The soft way is, you know, you have a successor, you step back. The hard way is 25th Amendment. And the 25th Amendment requires majority of the cabinet and certainly the VP. Now, when it came to that conversation, who are the eligible in that room that could be a successor? They're going to say, well, who would replace Biden? That conversation is going to come up before they rugpole Biden. And only two people would be Kamala Harris or Buttigig.

And Kamala Harris is a VP. Could be presiding over the cabinet. And it would be a continuation of the electoral strategy of Biden in terms of the base that they were focusing on and people of color and DEI and all the rest. So I think that's what got us where we are. are, the lack of a process to have competitively fielded candidates. I talked to the VC in New York this morning. He said, this is not a statement I'm necessarily make or not, but I'm just putting it out

that he said, the DNC put forth the only two people that could lose to Donald Trump, Hillary Clinton and Kamala Harris. I mean, it's like Trump has lots of negatives, too. But it was, I think the approach of the campaign, bad campaign manager, bad VP pick, a leader that hasn't been stress tested in political battle and failing to engage with social media and choosing to go on SNL instead of the All-InPod or Joe Rogan and display dynamism and decisiveness and kind of show authenticity and personality. Trump has some policies that aren't realistic like replacing income tax with tariffs or deporting

millions of people. they're just not, but they're clear, and people can understand them, and therefore they're authentic, and they know what they're getting. And with Candida Harris, I still don't know. The only things I know by Canada, like, I know that there's going to be attacks on and realize gains. Okay, I got that one. That one. I think a lot of people heard that one. What else?

And Israel and Gaza is not clear. It's like, hey, yeah, the protesters, we hear you, but Israel, we got your back. Okay, well, which one is it? So I think the DNC really fumbled this in a significant way. And anyway, so I wrote a post last night at 5.30 p.m. And here's the postmortem for the DNC before any elections were called. And if you looked at the electoral data, you could see that this was going to be a major Trump victory, just based on turnout. It was all in the public data.

As soon as the data set are coming in from Florida and some of the deep red states, deep blue states, and the shift, I mean, these stats I have on the screen right now are like some of the craziest stats. I'm from Jersey. It's always been blue. It always, my entire life, it's been blue. It hasn't even close. She only won Jersey by four points. I mean, these numbers are absolutely staggering when you look at them. Like New York, she only won by 12 points. I mean, it's honestly kind of insane. I feel like there's something wrong here. So it kind of goes to what you're talking about, Rob. Underperform. Yeah, she underperformed every swing state. And the message was muddled. It was, hey, I'm the next generation candidate. But also, there's no daylight between me and Biden. So is it a continuation or is it a change?

And then she would say, well, I'm not Joe Biden. Is that a reference to like gender or what does that mean then? Right? What does that mean? I don't know. What do you think, Ron, what do you think the Democratic Party should do now? I think a few things. One is the progressive wing carry them over the edge.

I think that DEI and the woke stuff is not center America. I think Americans are meritocratic. They believe in competition. They also believe in rule of law. Look, there are legitimate criticisms of Trump around January 6th. And instead, I got a funny text from another VC message me this morning. Let me, I'll read this out loud to you. So it's a fictional conversation between two, two Democrats.

It says Dem one in 2021. Trump just unleashed an insurrection and prove that he is an existential threat to democracy. We cannot allow him to return to the office. Dem two. Great point. We have to stop that threat. So let's govern hard left on DEI culture and immigration for the next four years, spend a trillion dollars

and on stimulus and get inflation going and then do an undemocratic bait and switch to a DEI hire. This is their words on my words. Anyway, that is not competent. Now, I mean, I think

it was a failure to read the room, failure to understand the basic realities. It's a repudiation to lose the popular vote. Yeah, but how do you think they can recover that? What should they do to make next election somewhat more interesting? Politicians love power and politics are competitive. Look, the Republican stance on immigration has kind of flipped from the 80s where they are now, right? So Silicon Valley was pro blue before, now it's red.

You know, there was the Southern Democrats in the 60s during the Civil Rights era. flipped Republican. So political parties are highly competitive. They will adjust their positioning. There's no doubt about that. And they will field more competitive candidates that are battle tested, come through a primary process. But I think you're going to see less of this progressive wing that on culture and on policy

isn't something the vast majority of Americans can relate to. or identify with just i think i think so you you will see competitive elections remember after uh well obama won i think there's some comment around you'll never see republican get elected again well well that didn't happen right he just won the popular vote you know right these markets are dynamic and politicians are dynamic and they will all adjust i mean trump is republican republican party supposed to be the market of free trade right so policies adjust people will they'll all adjust and I think the Democrats will get toward the center, which is good. That's just the way of high-profile Democrats, including Trump himself, that moved to the Republican Party.

Right. I think how you campaign changes. I think every candidate from here and out will be on the Joe Rogan show. That is going to be the new thing. It's not 16 minutes anymore. It's not CNN and Fox News. The must do is you got to be on Joe Rogan and you got to be on the Olin pot and not recognizing the reality that contents consumed via social media and shared socially. investing is a social process, politics is a social process. Comes back to the media discussion, comes back to the media discussion, the business models going forward. We just got a question here

that I think is interesting from the audience saying, why isn't anyone asking how Biden for 20 million more votes in 2020, which is an argument, I mean, I don't know if you could be asking that question being on either side of the spectrum politically,

but it's being mostly being asked by those on the left And there is actually surprisingly to me people claiming there may have been an election fraud because otherwise you can't explain such a big gap. And the answer, I think it ties up exactly to what Ram was saying before, which is Kamala Harris was not battle tested in the primaries by the people. she was thoroughly unlikable for way too many people even more than Trump, which is remarkable because a very large number of people dislike Trump. So that's the point. She's disliked a role.

I think that's what happened. Nobody wanted to vote for her. I don't think she was as disliked as Trump. I just don't think as many people liked her. She's just more like in the middle. Like Trump people have serious vitriol for Trump. I don't really get the same vitriol for Trump. for Harris.

It's just that there's not the opposite, the adornment. I mean, it's kind of, it still boggles my mind that people are like driving around every day with like a Trump flag on the back of their pickup truck in New Jersey and like all this stuff. It's a little weird for me. Trump was, he's popular and has enthusiasm. Obviously popular vote, right? Turnout was high.

But his messaging was around deregulation, controlling inflation, you know, ending wars. Right. Very clear messaging. And the Democrat policy, again, the only ones I heard that were very clear is tax to rich and raise taxes on them realizing. And by the thing about Americans is everyone hopes to one day be an entrepreneur and create wealth. So that messaging doesn't really resonate. And if you're a low information voter, all you hear is taxes go up. So a friend of mine, he's a manager of a bakery. He's a Democrat, by the, wanted to vote Harris. And I said, what about your employees, like eight or so employees, minimum wage, low income, low information voters, by the way. Every single one of them, Trump. I think that is related.

And this is what this is. Yeah. Yeah. And this comes down to the immigration question as well. Immigrants are not necessarily going to vote Democrat. They want to get rich also. Yes. Yeah.

Look, I agree. And the other thing, I spoke to a buddy of mine from Indian descent. And he doesn't relate to Kamala Harris. Think about identity politics. I don't think identity politics goes out the door. I personally would hope to. I hope that people can relate to one another as a human being as an individual with a set of values and interests that you choose, that you can enter into a voluntary arrangement with other people.

But I don't think that goes out the window. But that is, I think, also would hurt the DNC here. It is, you know, you're seeing shifts in every of these demographic groups going towards Republicans. by not by appealing to a different set of interests of like deregulation and controlling inflation all the rest you know bread and butter issues as opposed to abstract policies like the chips act i'm not talking with the merits of those policies and i think chips acts actually waste of money intel doesn't need the money whatever but um like the the chips act and the inflation reduction act that doesn't land for people the inflation still 3% right

Wait, Alex, you didn't answer your question before. Do you have an answer on what you think happened with the 20 million? I heard it was going to be record turnout, but the number seems to be low. She just was not, people were not voting for her, period. I wanted to say something else on there on the election, which is what I think a lot of people got wrong, was this discussion that was that a very large percentage of America cares deep. and more than anything about abortion and the whole abortion issue, which is a very valid issue, and that would drive an incredible record turnout among women.

And my argument was that that may be true. It makes sense. However, what is most important is the economy, because inflation has been wild. And even though in real terms adjusted by inflation, the wages and the income of actually ironically narrative validation of people on on or of poor people of people low class people actually they they wage increases have actually built inflation yeah it's actually people are people under biding are better off however they're not aware of it because that's true too much tend to think in nominal terms it's too difficult to adjust everything by inflation so

they feel that everything went to shit and that's why they wear for Trump for change. The Fed may focus on the PC, but the CPI is what sets consumer expectations of inflation. And 3.2 for core, that's nowhere near acceptable. But yeah, it's such a delicious point you raise there, right? Like, real incomes have gone up for the low income. I think part of it is, like, are you advocating for us,

or are you advocating for them? And Trump is very good at creating those polarities and leaning into them as a politician. That's part of it. Yeah. Yeah. Yeah. Another narrative violation I'd like to share is, and this is this argument is very pro-democrat. So I'm going to actually, for the record, state that I'm exactly the opposite.

So I'm expressing an argument that goes against my position and interests. is the following. The main reason we had, I mean the U.S. had such massive, like insane record immigration, illegal immigration numbers accounting for almost 50% of all new jobs created in the last two years, which is absolutely insane, is not really about diminished controls on the border.

That mattered. That matters. Definitely matters. But that's not the main key. The key is not the main issue. The main issue is that the U.S. has been growing so strongly more than other countries pushing wages up due to basically simple supply and demand imbalance on the labor force. So if you are an illegal or not a potential

illegal somewhere in Latin America and you look up and you hear from your family, the things are so well up there, you figure out a way to cross. And now that the job market has been going back in balance, a legal immigration should dramatically reduce even if nothing happens on the border. That's the argument. You guys can disagree. I'm actually curious if you have thoughts on this. I do not have complex loss on this. I'm not going to touch that hot button topic. It's a really interesting. I know, Alex, you and I spoke with a few months ago. The influx of immigration also helped to reduce labor inflation, by the way. Number one.

Yeah. Very good, actually. Right. Number two, softened and reduced recession risk as well. Right. The GDP is the product of two numbers. Labor, then labor productivity. If the left-hand equation is going up, then GDP's probably going up.

If people are productively employed and working. Now, I'm not trying to make a statement around gangs and Colorado and drug and all this stuff. Like, this is a complex topic, obviously, right? but one of the things that a lot of economists I'm trying to sort out is why was there no hard laundering in October 22 right the yield curve was inverted CRE was falling apart bank credit growth had come to a standstill and one of the interesting theories well look you had this massive influx of immigration as a as a policy lever alongside fiscal spending and monetary policy I think that's legitimate if you have a million people coming in it's like

two million people three million three million people come in and let's say half of them are gainfully employed. It's 1.5 million people at an income of times 40,000 dollars GDP, making up a number, right? Some would be above, some would be low. You know, that is billions of dollars, tens and tens of billions in stimulus. So it's, you know, it's complicated at the very least, right? I think it becomes clear in hindsight, but back in 22 was we were not talking about this. Well, what we don't know is what we don't know is what was the reasoning behind the relaxation of the immigration controls.

You know, Elon Musk is saying, well, they're coming and legalize them and then flip swing states to red states. Right. That's one argument. Or is it, was it on policy related or like what was that thinking? We don't know. But it's a super interesting question, which ultimately came back to hurt them. at the end. It's a question other countries are following

as well. I'm based in Europe, as we mentioned earlier. And in Europe, the immigration issue, which has generally immigrants have been welcomed with open arms on the whole. I'm in Madrid and not long ago, our big post office, which is a gorgeous building downtown, had a big banner saying,

refugees welcome. But now the mood has shifted. And part of that is one to do with the economic environment. There just aren't that many jobs to go around and we're teetering on the brink of recession. But two, the political tone set by the United States does have repercussions around the world on such big issues, such as borders. Tourism stuff in Madrid now? Or am I making it up. Antitourism? Like, isn't there a whole

whole bunch of anti-tourism? That's Barcelona. That's Barcelona. We welcome tourists. Everyone should come to Madrid. Sorry. As long as you're nice tourists. Madrid is gorgeous. Interesting question be like, supposing the Dems had kept tight borders, would the economy have had a sluggish recovery so they would have lost anyway? Right. So, like, we don't know the counterfactual there either. Like, what was the best hand to play over time? Yeah, very good point.

Now, you drop a trillion dollars in stimulus, by the way. Two came under Trump. That last package came under the Biden administration, which was not necessary, clearly. Hindsight 2020. had they not done that, would they have led to lower inflation? Sure. Right. But it's, you know, it's easy to quarterback looking backwards. And then there's the demographic issue, the demographic issue of people, you know, if the natural population is declining, you have to import the workforce. Right. Most countries in the world want to be in the United States' shoes to be importing, right?

China's losing millions of their most talented people to other countries, including the United States every year. They want to flip that position with us. We're importing talent and capital from around the world. The difference is that we're not selecting that talent through a legal process. That's the issue, of course, right? But I was going to say, Newell, I'd be very curious if you could share with us as Irish. Any views of your country that this is gone through such a remarkable transformation in the last 15 years, right? And I don't know that many people know about it. It actually is astonishing.

A lot of it is to do with regulations. It's a regulation-driven boom, which is fairly rare these days, especially for Europe, normally Europe's heading in the other direction, but make life friendly for large tech companies. And because you are in the European Union and mainly English-speaking, you get the large American tech companies setting up shop, building smart cities, that kind of thing. That drew the initial boom.

But then you have the issue of rising, property prices and you start to get the young people annoyed because they can no longer afford to live in the cities. And then you also have the immigration problem because the immigrants are attracted by the booming economy. And so Ireland is not quite an as happier place today as it was. I have to caveat that with saying I'm Irish, but I've never actually lived there, grown up in a lot of other places, but it's more state of mind kind of thing.

However, I do have family that lives there and while they're fine, they're happy. they can afford an apartment for their friend and the baby. Other young people. And we actually see unrest. I mean, riots on the streets of Dublin that's unheard of. All right. Let's go on to some of the House and Senate stuff. This is from Stan with Crypto's website.

Basically, we got 257 pro-crypto representatives and 17 pro-Crypto and the members were elected this thing. And I'm just going to read off some stats. So we're at 253 and counting, 257 and counting. I guess I'm not sure how high that number can go. Bipartisan pro-crypto majority in the House with dozens of races left to call. There are zero new anti-crypto candidates that were elected last night. 88% of the newly elected senators are pro-crypto, hailing for both sides of the aisle.

And 75% of the 355 pro-crypto candidates running for federal office have already won, and there's still more to go. So, I mean, this has been an astounding success for, you know, fair shakes, David Crypto. anybody who was putting money into these elections for crypto. And honestly, I think this is one of the biggest mistakes. I mean, maybe this is biased from all of us on this call. We're obviously involved in crypto. But one of the biggest like own goals in the entire election over the last three years, we'll say, maybe four is Elizabeth Warren and her anti-crypto army the way the SEC went about this whole thing. I mean, it just aggravated people with a lot of money, a lot of influence that just saw this as just petty and stupid. And, Here we are, and they're reaping the rewards of what they did. So we didn't really talk about this, but I think crypto and anti-tech and anti-growth is one of the things that really came back to hurt the last year. It's not just Harris. Like, mainstream media has underestimated the amount of wealth that exists in the digital asset industry. They assume that it's something like Draft Kings, and look, crypto is about speculation.

Like, no one's denying that. Yes. Okay, that's what it's about. Sure. Now, but they've underestimated. underestimated the amount of wealth and influence that this category has. My business, Lumida wealth, is premised on that, by the way. We're still the only wealth manager in town, which is great. But also, it's reading the room, like you said earlier. They did not read the

room. What do you gain by being anti-innovation? Crypto, especially those, all of us with good faith in crypto, we're happy to follow rules, just tell us what they are. The anti-immigration army railing against progress does nothing but transmit a bunker mentality, which generally doesn't win votes when things are going well. It was. There was a hand played after the collapse of FTX and SBF where they had to wash their sins away from taking money in from SBA. CYA, right?

Correct. And they had to run in the opposite direction and overextend to make up for that. It was really fun. Remember, the Dems were. actually, and Maxine Waters, who's the head of the House Financial Services Committee at that time, Sherrod Brown, who was voted out, right? So, you know, money does influence politics. And it was an interesting ricochet. They made the wrong bet. They thought that crypto was dead as an industry in the wake of FTX. That was the bet they made and it was a wrong bet. Yeah, I would say,

another thing they'd wrong bet they made was I mean the Biden admin completely shafted Elon Musk with his electric vehicle like they had an electric vehicle panel and they didn't even include Elon Musk or anyone from Tesla in that and I feel like that was just another own goal like there was no reason for that and I feel like I don't know how much it actually contributed to Biden going I mean to Biden to Musk going all in on Trump but that's that's another own goal that the Dems there's a lot of own goals here that's a really what if Elon Musk hadn't bought Twitter, what impact might that have had on the election? I don't know if it would be decisive for now. I think it would have been censored. Because he still had the big account and the reach and something that people debate that maybe he tweaked the algos to increase the presence of his tweets in our eyes feeds. He definitely did that. Definitely.

Yes. Yeah. But, yeah. But does anyone mind, I mean, fine. I think I'm with James on that. Of course. I mean, of course he did. There's reporting on that too.

Every time I open my thing is to eat right at the top. There's no way. There's no way that's not designed. There's no way. He's even talked about that on the Joe Rogan show. He was like, oh, well, I used to do this. I'm in tune with the algorithm and I used to get interactions like this. We probably wrote it.

But again, if that's the worst and it's not that bad, and he's entertaining, really least. But, yeah, I mean, would it have been better of him, as Alex very correct, you know, very stutely points out, would it have been to not have bought it and instead have been kicked off? It's an incredible amount of power he wheels, right? Yeah. Running X. And the question is, do you want your guy or a gal to run X if they're on your side?

And, you know, the reason why we created a republic here in the United States is to have rule of law so that the laws applied. And that, you know, is it still an interesting question when you think about all of this, right? Like, how do you, like, here's a question for Elon Musk. Did he elevate or promote tweets that were pro-Trump? I don't know. So I'm just interesting. If he believes that if Elon said, this will be the last election, if it goes, if it goes towards the dam. That's what he's saying, right?

If he believes that, wouldn't it be rational? And he's an incredibly rational person to put his thumb on the scale and try to inflat. I'm just, what did he not? Right? I strongly think that without Elon doing what he did, he literally went all out. He risked everything, I think. You got the Amish to vote, right? Did you guys know about this?

He literally risked everything. Without him, we wouldn't have won. There were prominent Dems talking about the fact that we need to like stop. Once this election is over and Harris wins, they need to like cut the contracts with, with must company and like all these other things out there which is just insane on its face but like the fact that like he yeah i mean he did what he always does he tends to just lean into one thing and he was he's put a lot of time money and effort into pa and it was a pretty slim margin but not as slim as as the pollsters were suggesting and who knows how much impact you actually had but

the the answer is it's definitely the impact was not zero as far as i've concerned There's a broad swath of disaffected people that were upset. I mean, private equity, you know, a lot of people were upset. The Amish were upset. The Amish felt the long arm of go. There were billboards. There were Billboards. But the Amish paid for them.

Right. And 100,000 of them voted. And what was the margin of victory in Pennsylvania? I don't even know. I think I went to bed at 1030 last night. I thought, you know, the campaign would have been. It was like 200K people. All right.

Yeah, almost 100,000. That's material. So I think the interesting question around Musk was it, you know, the alternative history stuff is kind of fun. But look, I think I knew it was a broad base of people that were just very disaffected with the current administration and they wanted to change. I go back to like what you were talking about with inflation. There's a lot of people out there in a lot of jobs.

Yes, the average person was better off. But there were plenty of people who, whose incomes did not rise above the level inflation or at the rate of inflation. And even they were just upset with what Biden did to the economy, even if it wasn't Biden's fault. Even we take a step back. And you could argue that some of it, like a lot of it probably wasn't completely his fault. He did a lot of, I would argue he did a lot of good things. But it doesn't matter.

If you're disaffect, like you're just not going to be happy. If you look like when people try to predict elections, one of the things they look at is like inflation, how have people felt about the economy? And like if they felt crappy about the economy, even if, like, like you were saying, we're in a Goldilocks thing. It doesn't really matter if he actually created a Goldilocks economy. If people felt like their dollar wasn't going further, yada, yada, yada, and many people, it actually wasn't. Those people are probably not going to vote for you again.

Yes. I agree. Yeah, first off, like on the vibe, the vibe matters and the leadership sets the vibe, sets the tone, right? You think I wasn't around when Reagan was running for office, but, you know, I've always been told about this sunny, shining city. on the Hill speech, like legendary speech, about delivering optimism. And what you saw after the victory is you saw, at least I saw on X, are videos and reels

of rockets going up into space and entrepreneurship and celebrating founders and innovation. And that's a story that attracts people. It's a dynamic story as opposed to a story around identity politics. You know, that sub 30 crowd, here's another thing. that student loan debt relief program, it pissed off people that actually vote. People don't forget that. People, 60 plus, they vote the most. And I think under 30, that's only 10% of the electorate.

And half of them currently voted for Trump. And they also don't like the DEI stuff, by the way, either. Yeah, which is really, the big winner today really was democracy. And I say this as a non-American and I don't know how Alex feels about this also. but we saw democracy at work, and it was messy and it was loud, but it worked. Disaffected people were able to vote for change, and we got the result much faster than we expected. I thought that was pretty awesome. Yeah, it's 100%.

I think it's a very, very strong point. Because precisely, like a very large chunk of this country, thanks the opposite way, that this is a victory of a non-democratic party, but this is exactly the opposite. This is the victory of someone who, with a party and an assistant behind, he went through the democratic process, and they fought, and one side won fairly. And, yeah, both sides had a lot of lies, one more than the other,

but whatever, it's subjective, which one was it? But it's also politics, yeah, people lies on camera for both. right unfortunately. So we're, let's, we have two more topics before we wrap up here. I agree with pretty,

I wish we disagreed more. The only thing we disagreed on was the fact that Musk Musk put his finger on the scale was how he had his finger on the scale. Well, we have a good point, actually, the macro.

We're going to disagree on the macro, I think. Yeah, I was about to say we have to touch on what's coming tomorrow. Let's talk about real quick, let's keep this part short, the fact that I'll be the first one to say, I was on here saying, I thought that the polymarket odds were probably leaning a little bit further right than the actual, like, you know, odds are. So I, we talked to on this earlier, but that French whale, which was all over every major news outlet, it was all over, he was all over Twitter before we,

he got to the major news outlets. And people were saying he was idiot. The dude just pulled in $48 million on his bets. I mean, he bet on Trump to win the popular vote, which honestly, I personally, I thought Trump was going to win. I would not, I would have taken pretty damn good odds that he was going to lose the popular vote. So I'll take the L on that one, the figure to bell, because I can't touch this stuff. But yeah, I guess do you guys have any thoughts on like polymarket in general betting odds? I mean, if you look at this, if you look at like from 10 days ago even, and you look at what polymarket and Kalshi and all these things were saying, which states were going to go which way, The map is basically what the map has come out to be.

I mean, granted, I think Arizona and Nevada still haven't been officially called, but it looks like it's going to be Trump. I mean, if that happens and you look at what the odds were on polymarket, it lines up exactly. And it just shows, I guess, kind of like efficient markets a little bit. It shows, you know, when people are putting millions of dollars at work, it might mean a little bit more necessarily than pollsters. So, yeah, I guess quickly, what are your guys' thoughts on, you know,

polling versus betting markets and Polly Market and this French whale. I can dive into that because I've been talking quite a lot about that recently. And one thing we tend to overlook is that Polly Market is not a poll. I mean, we all know this, but it's important because they're very different questions. Polymarket asks you who do you think will win, not who are you going to vote for? And that's not the same question at all. Polymarket is a probability platform, a betting platform. There are many other terms we should maybe use rather than a prediction platform, whereas the polls

are more about on the ground asking people what their intentions are, not what they think the result will be very different. But polymarket betters are going to be parsing the polls to place their bets. So it's a cause and effect issue, I think. Two observations. One is polls are a form of marketing. They're not truth-seeking. You hire pollsters to deliver a certain result to influence a perception.

Kamala Harris was at her home last night, not on the front line because I believe that they saw the conclusion coming. Anyone that looked at the data saw this coming, I had a post again on my Twitter feed 5.30 p.m. last night writing the postmortem of the Harris campaign, just on the public data. So that's what polls aren't legitimate. Number two is, a plying market is our new source of truth. It's market-driven truth.

It's an oracle that we can look to. It got it right. it adjusted in real time based on the data. Is there a slight bias? Maybe. Is there evidence of that? Not really. But I get your theoretical point.

I'll take the L on that point though, because it was even strong, like the, it turned out even stronger. I'll take the L on that. It probably wasn't leaning right in the way I thought it was. But we need more betting. We need more event prediction markets to understand truth. More liquidity. More liquidity.

Because, you know, if you're, you're. You have to pay for your view. You have to create accountability to have a point of view. You're going to place a wager. And you're motivated to be correct. And those are not the incentives that you have in traditional media. Yes. And it makes it easier for us, the mainstream, to see what the experts who are doing, the research, are thinking. Also, makes it easy for people to, for people like everybody, including ourselves, to put a number and visualize what's going on. What am I trying to say with this is that polymarket, even though it was going against predicted, for example, for large chunks, amounts of time, it was in line with, say, other Trump trade assets like the long bonds. So there was a big move on bonds on the 10 year and the 30 year. They were aligned.

Yeah, there was online. It was a financial market sniffed out the Trump win, right? Yields were going up and dollar was going up. Yeah, what you were saying before, yeah, yeah, yeah. So it's not that it was in isolation. You could say actually the bond market was also like saying 60% Trump probability, right? Or 58, whatever. We can argue about the exact percentage.

But it's not just polymarket. It was financial assets. And if you're a very well-informed trader who plays out, who arbitrages, you could even be arbitraging what the implied probability is based on the 10-year-node or the third-year bond and polymarket and basically put it in line to where it should be, right? And the other thought I wanted to say is that in our last pod, right before, actually, I had changed my view on none of you recall, Jane. on the elections.

I decided to put a lot of time into studying polls and if polls had somehow adjusted for the anti-Trump bias that had expressed in 2016 and 2020, but not so in the midterms of 2018 and 2022.

And I didn't see anything. It was just just blah, blah, blah, blah. It's like nothing really fundamentally has changed. So why would we not be expecting again a Trump? anti-Trump bias that basically shows up in the count as polls under representing the real Trump vote, which is what happened. Yeah, and they did say they were going to change, didn't they?

Well, from what I've seen, 37% of pollsters change the way they did things from 2020. Yeah, that's not much. Maybe we'll see something different in 2026 and 28. All right, let's go on to macro. So for a while, the market has been pricing, 25 bits cut tomorrow and another 25 bits cut in December. I'll just say, I still think they're going to cut 25 tomorrow. I think December is in serious jeopardy. But we'll see.

There's a lot of numbers coming out. I guess I'm not a macro guy specifically. So let's go to you, Alex. What are your thoughts on what's going to happen with the Fed cuts, the FOMC? 25 tomorrow, 25 tomorrow, likely nothing on December, as you say. That being said, they're both irrelevant. Right now it's all about the elections, worrying about what Powell is going to say. I think it's going to be a lot of very interesting and even fun listening to Powell right after the elections to see if he changes his tune, but it won't really matter because this is so big.

So for a little very short period of time, forget about it. for and see, that's the way I see it. Yeah. We were supposed to be disagreeing on this, though, but I can't disagree with you on that. Sorry, I agree. I don't think they should cut 25 tomorrow. There's no indication in the economy that the slowdown is warranting that kind of a move. But I don't think they cannot do so, given the strength of the market, signaling the Fed's

not going to want to deliver a surprise. I'm an agreement with Noel, too. There's no need for a rate cut. Trump's election is equivalent to, I don't know, call it 100 bips and rate cuts because of the knock on effect to animal spirit, small business enthusiasm. Look at, I bet you dollar to donuts, the NFIB small business survey comes out next month, then it'll be going up. People are going to spend more. CapEx is going to start going. This is why this whole talk of the so-called neutral rate that academics talk about is so misguided. There was a substantial easing that just took place today.

And that was reflected in financial markets. We had a repricing in all these risk assets. they'll cut to marks. They want to surprise the markets. They shouldn't cut in December. But let's see what they say tomorrow. I mean, to be a flying law in that way. I think I mean, it would be so delicious. Just the first day. Just listen. What are they talking? As the results are coming in while they're in the meeting. That way you're right. Oh, yeah. I mean, you can't even, you can't make this up. But Kevin Warsh will likely be the next FOMC chair. Markets view Trump as inflationary, you know, drunk and middle. put a big short bounce trade after the 50-biffs cut in September when it's 3.5% actually I think it was correct. You know, the thing that markets don't get is that Kevin Warsh will be more hawkish and markets won't care about it anyway for months. Markets even care about the election until Monday, by the way.

Then markets said, who's going to win? And then things started repricing Monday, Tuesday, and then Wednesday. Yeah, I mean, I'm not an expert on any of this stuff. But a lot of the things that Trump is talking about are likely to be rather inflationary. I mean, if he's really going to put on, I mean, I don't actually think he'll put on a 60% tariff, but that might be just a starting point for his negotiations. Who knows what he's actually going to do? But like his camp is trying to argue that tariffs aren't inflationary, which is like my,

you just look at the data. That's a bunk argument. That is just not, I mean, yes, maybe it could help like middle class Americans who need those factories and things and like stuff like that, yes. But it is undoubtedly, those are. are inflationary actions. And the rate cuts he's talking about doing for for higher income earners and things like that, the wealthier individuals, likely to be inflationary, at least for asset prices. There's a lot of things that he, I agree with you, Rahm, it's likely to be

inflationary. I don't know if it's, I don't know if I'd say it's equivalent to 100 basis points of cuts. It's something. It's 50 bits. It's something. Yeah. I'm on the, I agree with drum, it's up by a hundred. And the bond market is telling us that. I mean, we have the 10-year at the highest point in a year. And the bond, the 10-year yield started heading up the day of the 50 basis point cut. The bond market started sending us messages back then. And the question is, how long before the stock market starts listening? I think we still got a while to go before the stock market starts listening, but that time will come. You know, that's actually the only the only thing I'm fading here. In fact, I mean, I started buying long bonds.

it's an interesting idea I like that idea there will be incremental real economic growth when I'm saying it's more inflation I don't mean that in a dismissive way it's part of what you get

with higher real economic growth too right you're going to see active price inflation even nominal growth can drive stock prices yes so on this I think is very important

at least like here I think we're going to disagree, but the tariffs, which are, I think, would be an abomination if he does 60% on China or anywhere near close to that. It would be very bad for the U.S., for growth, for inflation, for everybody. He's not going to do it. He's not going to do it. Same thing happened in 2016. It didn't happen.

It happened a little bit. And the way I say it is this is the Trump style. He is very aggressive with words to try to. avoid shit going down. So it's a negotiation. Exactly. It's negotiation style and it's very effective. So that's why I don't see problems on tariffs and I don't see such a big

inflationary problem in the US coming from Trump. I think actually we're going to go and remain in a disinflationary environment. And I'm seeing a lot of people, especially in Europe, extremely concerned about Trump and tariffs, both on research I read. And actually, you can see it on the stock market, like Europe is down, right?

So, like, traders are as concerned as analysts. And I think that's the wrong trade. Same thing is China. China is down on Trump overnight. China's coming out with stimulus finally supposedly announcing their numbers in two days. I think it's a fade. I think these fears are going to pay. pass and in fact the opposite is going to happen that Trump is going to push China to do more

which would be a good for for Chinese markets and risk more what to stimulus stimulus yeah interesting um Alex and Ramon and James that your opinions please of how high do you think the 10 year yield is going to reach before it turns I'm literally not allowed to answer it that I'll say out of this one that's true you can't yeah all right Alex what do you think I don't have a number, unfortunately, but I think not much longer. That's why I started buying. I agree with Alex, too. I think, you know, gold broke today, by the way. So I call that, like events change dynamics. We had an event. So if you're going to change the trajectory of the 10 year, today would make the most sense. But if we're wrong, then it's probably 5%,

which was the peak in October 26th of last year. Yeah, just what we're going to talk about, gold has gone, gold has gone from 2750 to 2,600. So, it can afford a correction and still have a really, really good year. I was looking it up the other day. It's very, very rare. I don't even remember the last time this has happened, if it has happened, where you have gold and stocks going up in the same year. That's a great point. And gold's been beating the S&P like the last two years, by the way. Which is extraordinary. I don't think that's going to continue. By the way, I agree. I don't think the, I think the tariff war issues are

probably overblown. It's a tactic for negotiation. Elon Musk, but the tariffs he needs for EBs because he really needs them. Like China, EBs are really competitive on the luxury and the entry level. So, yeah, China will have no choice but to, you know, spend to, you know, get their economy out of the gutter.

Sorry, I cut you off before, Alex. And let's see what that does. Let's see what that does to currencies. And oil. And, yes, exactly. Alex, what were you going to say before when I cut you off talking about the gold price? Oh, no, I'm good. I mean, I can talk about gold, but not very exciting. It's just mainly a strong dollar.

I wouldn't be fading right now, the dollar. I would give it. Like, bonds can start now, at least that's what I'm doing. The dollar, it's give it a few weeks. And anyhow, trading the dollar is so boring. Who cares? So it's like, sorry guys. I think the dollar in the 10-year probably turn around the same time.

It makes sense. Yeah. And that would be another tailwind for Bitcoin in theory. And international stocks, too, I think, as well. Yeah, I mean, how much longer can this eight percentage point outperformance versus international markets can large-cap U.S. stocks go on? I mean, at some point, there has to be aversion to me. And I just don't know what that catalyst is. We'll see, I guess, at some point.

But I don't know. I think that's it. Is there anybody, anybody have any other macro comments? Are we ready to wrap up? vibe session is over. Goldilocks is here. Goldilocks is here. I love that. Ram, are you going to get t-shirts made with that? Yeah, I'll have to.

Any last minute thoughts, Noel? No. No, it's just been great talking to you. Seriously, I learned so much from all of you. And it's just so exciting to, you know, be able to talk about this at this particular point in history. We're privileged to be able to witness what is unfolding. Fascinating. Likewise. All right. Alex, any last minute thoughts?

Yeah, great to have you guys. All right. Rom, Noel, thank you very much for joining us. We missed our co-anchor Joe. He had an event with his clients, so apparently clients come first over the Bits and Bips pod. Who knew? He knew.

The people who write your checks in a figurative manner of speaking actually matter. All right, guys, thanks for joining us for this episode of Bits and Bips. We'll be back in two weeks, discuss more about how the world's 50 Macro Recalliding. Until then.