Unchained - Bits + Bips: Why Iran Is Trump’s Greatest Taco. Plus, Is Elon’s TeraFab ‘Bullshit’?

Episode Date: March 25, 2026

Trump pulled off a five-day ceasefire nobody expected. Ram calls it the greatest TACO of his career. --- Thank you to our sponsor: Nexo — the premier digital wealth platform. Receive interest on your digital assets, borrow against them without selling, and trade a wide range of cryptocurrencies all in one place. Now available in the US with 30 days of exclusive privileges for new clients. Get started at nexo.com/unchained. ---- Trump announced a five-day pause on strikes against Iranian energy infrastructure just hours before his own 48-hour ultimatum expired. Oil crashed below $90. Bitcoin surged from $68,200 to above $71,000. Ram called it the greatest TACO of Trump’s career and said the Trump put is officially here. Meanwhile the Fed held rates steady but the dot plot revealed a historically wide internal split: seven members want zero cuts in 2026 while five want 50 basis points or more. Powell warned inflation isn’t coming down as hoped with projections now at 2.7% for headline.  And in tech, Elon Musk unveiled a $25 billion chip fab that Ram says is pure fiction while Bezos raised $100 billion to buy manufacturing companies and transform them with AI. Hosts: ⁠⁠⁠⁠⁠⁠Ram Ahluwalia⁠⁠⁠⁠⁠⁠, CFA, CEO and Founder of Lumida ⁠⁠⁠⁠⁠⁠Austin Campbell⁠⁠⁠⁠⁠⁠, NYU Stern professor and founder and managing partner of Zero Knowledge Consulting ⁠⁠⁠⁠⁠⁠Christopher Perkins⁠⁠⁠⁠⁠⁠, Managing Partner and President of CoinFund Learn more about your ad choices. Visit megaphone.fm/adchoices

Hey, everyone. Welcome to bits and bips, where we explore how crypto and macro collide one basis point at a time. We're here to discuss the latest stories in the worlds of crypto and macro, but remember, nothing we say here is investment advice. Check unchainedcrypto.com slash bits and bips for more disclosures. And before we begin, a quick word from our sponsors. Introducing Nexo, the premier digital wealth platform. Receive interest on your digital assets. borrow against them without selling. Trade a variety of cryptocurrencies.

All in one platform. Now available in the U.S. Get started today at nexo.com slash unchained. Quick note before we get into today's episode. Bits and Bits Now has its dedicated feed. We're spinning off from the Unchained feed and moving to a new podcast and YouTube channel. So if you want to keep up with our weekly live streams and macro meets crypto breakdowns, make sure to subscribe to Bits and Bips directly.

We won't publish there until March, but subscribe to it. today so you can be ready for launch. Be sure to subscribe to the new feeds at unchaincripto.com slash bits and bits. All right, everybody. Welcome back. I'm your host, Austin Campbell, a high scholar of zero knowledge consulting. And with me today are Ram Alawalia, maister of wealth, leader of Lumina, and Chris Perkins' golden hand of coin fund. We're going to start today with the segment we're calling the Iran Offram question mark. So what happened this morning? So what happened this morning? Trump announced that the U.S. and Iran have had, quote, very good and productive conversations regarding a complete and total resolution of our hostilities in the Middle East, end quote,

and is postponing all strikes on Iranian power plants and energy infrastructure for five days. This came just hours before the 48-hour ultimatum to Iran to reopen the Strait of Hormuz or see its energy infrastructure destroyed. Iran had warned any such sort of, strike would trigger decisive and devastating retaliation across the region. So this de-escalization, or excuse me, this de-escalization was notable for markets. We had futures ripping, going from being in the red to in the green before the open. Oil crashed, dropping below $90 a barrel. Gold came back down. Bitcoin surged up from the weekend low of $68,200 to above, I think, 71K around the highs. And to frame this, Lynn Alden has talked about the flywheel of chaos framework,

where in her March 26 newsletter, she framed the Iran conflict as a potential toxic combo, calling for sustained energy disruptions, the cascade into consumer spending displacement, that forces both liquidation of treasury reserves and quite frankly just reduction in economic activity that forces people like the Fed into a stagflationary trap. The base case there is a gradual print phase with balance sheet expansion and a, quote, big print of two plus trillion if necessary. The key risk, though, is if the straight stays closed for months. This appears to be moving back right now. So what I want to start with, Rahm, you've been watching the market all day. what is the market making of this? Does it think it's a real off-ramp? Does it think it's a head fake?

Like what does it need to see to unwind the war concerns? Well, the market's got out of indecision. It closed very close to where it opened. That's happened a lot. You know, over the last few weeks, a lot of the actions overnight. You know, oil dropped about eight to ten points, depending on what you're measuring. Then it stops. The market's a repricing. information quickly. You know, there are parts of the market where the storm has moved down, including technology areas. Like there's legitimate value out there.

And we've been accumulating some names in those pockets and quality names that long-term investors would want to own. I mean, they're stepping in there. So we're seeing that too. It really is quite extraordinary, though. It is really extraordinary that history unfolding. You know, Trump said that he has, quote, 15 points of negotiation. that they've established.

The Iranians denied that. Then Trump denied the denial of Iranians. And there was an individual named in the parliament that they're working with. And there's no agreement on the most important terms around who will control the straight. Trump said, we'll both control it and then maybe we'll just control it

and there's no agreement on the uranium and what happens there and maybe we'll go there. So those are not part of the 15 points, clearly. Those would be the most essential points of these 15 points. one would think yeah so trump trump is doing the great taco the taco of old tacos this is like the breto supreme and he is doing it with confidence and hutspah and just looking straight to the camera with no flinching and just winging it i mean it's it's it's incredible this is incredible

the books that will come out of this the movies the you know we're living in we're living in history here we have the Trump put. The Trump put is here. We've seen the Trump put. You know, Trump does not want Marcus to crash. And he stepped in after, I think, Busson had a pretty weak interview and he looked tired and haggard yesterday on underneath the press interview. So it's in the hands of the IRGC, also in the hands of remote field commanders that might make decisions independent from the ARGC and the parliament and members of parliament. There's reporting that in Pakistan, there's a meeting with the U.S. delegation, an Iranian delegation that's set up in the coming weeks that you've got a number of countries, including Turkey and Saudi Arabia and others attempting to influence Iran. There are some

tankers that have moved through the strait, including one from Saudi. And Saudi Iran are rivals, by the way. that's that's meaningful signal there's still a lot more to to see here will insurance be offered to these carriers now a lot's in the hands of Iran a lot is in the hands of Iran now and you know it's the new cycle is flipped entirely from Epstein a few weeks ago to now it's like get the price of oil down and Trump is doing the the greatest taco of his career right now so We'll see. We'll see what happens. As we observe Trump starting to say, what is the right way to say this,

things being directly contradicted by the Iranians at times and confirmed at other times, back to something that we've been discussing previously, do you think what we're seeing here is a fracturing of the Iranian regime? Are we seeing multiple voices starting to emerge inside Iran where the reason we're having this fragmented of a conversation is that they are no longer speaking with one voice, especially as we've been, for lack of a better way to put it, just bombing the hell out of them. No one really knows, right?

But you know, you have the IRGC. Apparently the hardliners are in control now. Then you've got the parliament. And then you've also got the junior level staff that quote unquote don't want to go back, don't want to go into work. I can understand why. and then Trump earlier said we took out group one and then group two. I mean, it is extraordinary.

And you're negotiating in Twitter, right? And the Iranian foreign minister last night said the straight and room is not blocked. And it looked like that was a white flag coming from Iran. And Trump responded to that with this alleged 48-hour discussion. And, you know, the interesting comment Trump made in those remarks this morning on the tarmac. He said, quote, unquote, if this works, somewhere in the middle. You could almost see a glimpse of light. It strikes me as a gambit. Trump saw this comment from the foreign minister put together a story around a mutual de-escalation. They reached out to us, and it strikes

me as a gambit, five-day cessation of hostilities. Meanwhile, there's a Marines on the way. There's a five-day timeline. It's a threat of future hammer. And the Iranians have a shot to create some goodwill with their neighbors. They also can't punish the U.S. by keeping oil prices high. All right, really, really interesting things over the weekend. I think the first thing that caught me, Austin, was the timing. And so Trump shows up and he's like, hey, 48 hours or I'm going to blow up all of your infrastructure. The first thing I thought about is like, wait a second, 48 hours is like on a Monday night, which would be like right after this episode was filmed.

That makes no sense because he never does anything when the markets are, you know, generally open. And I would say that during the week, they're generally open. So that was a little bit weird. And so it's not surprising to me that the five-day extension puts us back in when all markets are closed except for hyper-liquid and crypto, right? That's when he likes to make his moves and he tries to be like somewhat less disruptive. Ron, to your point, one of the really interesting things here is that within five days, like the 31st Mu, Marine Expeditionary Unit, which has a battalion of Marines and artillery battery, that will be closer to getting on station. I think the 11th Mew is coming in as well.

So you have like two battalions of Marines. The thing about Marines is that they don't love like doing what I did when I was in Iraq and like trying to like, you know, police people and teach them about democracy. They're really good at like taking territory, particularly amphibious. Like they're, they're, what they do is they do amphibious landings. They've been planning this for 50 years. Don't forget that the Marines barracks were bombed by Hisbala, which is an Iranian agent. So like the Marine Corps's been waiting for this for a while.

They're not afraid of a fight. I don't know if they're going to be deployed or not. But like everything's kind of coming together for the weekend. It'll be a very interesting weekend from a geopolitical front. But from an economic front, you know, Rom, you mentioned that Besson was like looking a little bit haggard. The reason for that is the tenure, right? He freaks out. Like, what does he obsessed with?

The tenure? Ten year, like I think they can tolerate Brent oil going higher because it's like an overseas measure. You know, WTI seemed somewhat more contained here on shore. But when the tenure goes, like, all bets are off. That's when Besson really gets uncomfortable. You know, and so I think that was part of the stress there. And so where are we right now? You know, you mentioned like Trump said maybe I'll control it with the Ayatola.

What does that project? It's like he doesn't care about regime change, right? Like he doesn't care. He wants somebody who's strong, who makes them no longer be a pain, who doesn't have, you know, he put out his 15 points. But he's not there to like, you know, facilitate democracy. He wants the Venezuela model. I heard him say that again yesterday, but Venezuela is working great.

Why can't it work here? That's the end goal. But what we need is we need that straight to open one way or another. It's hurting fertilizer. It's hurting oil. And it's really embarrassing. Like at some point, it's going to be embarrassing because, hey, why does this country have so much power over the world? How come their control?

And I think we're in a position. I don't think, I think the Gulf states are realizing we have a really big problem here. If the U.S. just pulls out, and we've done this over our histories, we've just been like, you know, we've had enough by, good luck, guys. And I think they're actually trying to move closer to the U.S. right now because the status quo and what they've seen the Iranians can do without a nuclear weapon is very scary. If they had a nuclear weapon, then they would essentially have control of the strait forever. and we're seeing what that happens.

So the status quo is over. Like, things have to change. And I think that has to, the only way through this is if there's a permanent, well, nothing is permanent in this world. But you have to have a stability and freedom of navigation return to the Strait of Hormuz one way or another. I think that's what we have to see. You're saying that as your policy objective or your read of Trump's true policy objective?

I think that there need, how do you declare it? victory here. You need to deal with the nuclear side of things. By the way, the Israelis are not going anywhere. That's their neighborhood. They're not going to stop until the nuclear issue is taken care of. But across the globe, I think the political and the military objective needs to be freedom of navigation and straight of foremost. And the U.S. will play a role. I don't know what, but that has to be the goal. I don't see any way around it because right now, like you have one country that's been really, you know, destroyed holding up the global economy. Now, the other thing that's really weird, you talked about this, was with their Speaker of Parliament.

And he rocks up and he's just like, you know, talking about he's going after everyone with treasury bills. We should talk about this because I think everyone in Iran would love to own treasury bills as stable coin owners. I think that would be great. I think the people love stable coins, particularly Tether. I spoke to a student from Libya recently, and he's just like, yeah, like Tether's saved my family. it's incredible. So I thought that was interesting. But the other thing I've been thinking about is that if you want to know the truth, you generally follow markets. That's the closest thing you can get to the truth. You know, everyone's going to say whatever they want to say. It's very hard to

cut through what truth is unless you look at markets. Markets have responded favorably to this concept that Trump is saying, oh, we've de-escalated and we're meeting. We're having these meetings. At first, the press is like, what the hell are you talking about? What meetings? Who are you talking to? But my gut tells me that they're probably talking to somebody because the financial markets are reading it that way, I think. And then you saw this recent reporting that our boy, who is Mr. Treasury, the Speaker of Parliament, and Iran, it does sound like he may have boarded private chat to initiate some conversations.

Is that true or not? I don't know, but I'd know that markets are responding generally favorably. and I tend to believe markets when it's very hard to cut through everything else. Well, I want to pile it on the markets point and say the interesting, call it market regime has been parts are responding favorably. Parts are falling apart a little bit. If you look at the Asian economies overnight, I think we're still pricing some degree of oil disruption. I also don't think the 10 years loving life right now or the 30 years,

we look at it. And what's fascinating to me about this is I think reading between the lines of market signals, again, like thinking like a trader in this context, what the market is telling us is that the worst case scenarios appear to be off the table, e.g. the straight stays closed forever, like Iran goes full nuclear, et cetera, but that the best case scenarios are also off the table. That is to say that there's a very quick resolution of this. We don't have some sort of inflationary shock call it moving through the snake and i think that comes back to the point of i agree trump's probably talking to somebody in iran but does iran even know who iran needs to be talking to who is who is iran right like that that that's the problem what do you guys take of like have you been watching

btc gold ratio i have um the colossal beating that bitcoin took on the end of that is now going the other way as we move into this year i feel like there's two separate threads going there. One, to go back to sort of what Lynn Alden was saying, if we do think there's going to be a significant expansion of money supply, Bitcoin has historically been one of the early detectors. And so Bitcoin's starting to go back up is something I think everybody should be keeping an eye on. But the second point is that a lot of the people who have been hoarding gold

are now the exact same people who would be under pressure from energy. And so if you don't want to sell treasuries to get a lot of gold, aggressive with the United States, what would you sell right now? Rahm, I'm curious what you're making of this divergence between Bitcoin and gold and what's going on with the long rates. Well, yeah, gold had an extraordinary sell-off, along with the commodity complex overall. It put an incredible wick today. I wouldn't be surprised if we've seen the lows in gold.

I'll be surprised we've seen the highs in gold, too, though. You know, a lot of crowded momentum was hiding in gold because it was one of the few categories I was working along with silver and a few others. I think that just got washed out. That's where the hop-ball liquidity went. They said, okay, this is working. Let's camp out there. They did the same thing with NICron. Both of those gave way.

So that's how I look at that. It's, you know, on the East Asian countries, these are most sensitive to oil. from the state of her moves. You know, South Korea was down several points yesterday or our morning, and now it's up five points, and Japan is up to. So I think markets are legitimately in a point of indecision. They're trying to discount what's happening next. It's a period of high volatility and uncertainty.

So where does the hotball money go next, Rahm? You know, I think the move is to, you know, you don't have to, read every tea leave, right? You can wait, just get small, go after high conviction opportunities that you have legitimate value presented in front of you that you can pick up and say this will be a good investment one or two years from now. And we're doing that like in information technology. We picked up Navidia. It was at $5 trillion valuation in October. It's 4.3 now. We picked up a bit of meta. Their software companies that have 5 to 8% free cash for yield, their sales were still going up.

Progressive, you know, these incredible insurance companies that are growing double-digit revenue EPS growth. You know, there's the morning stars of the world, rock solid businesses like S&P Global and, you know, there's a number of these high quality businesses that are just that are very cheap. They're also economically resilient. So, you know, there's a lot of uncertainty. We might be transitioning into an inflation regime. We had the PPI print come out last week.

at 0.7 versus 0.3 expectation, and you're looking at all sorts of commodities moving higher. So owning quality businesses at a reasonable price makes a lot of sense to me. I think that's what institutions are starting to do. Many of those names I mentioned actually have been moving higher over the last week, unlike the overall S&P. So they're starting to lead the market out of this. But it's still too early to save for many other categories, though. It's still too really to say for many of these categories that depend on the price of oil.

Airlines have been doing well despite oil being in the high, you know, 80s too. So this needs more time to process. This needs more time. This is a process. It's not an event. We have to see exactly what does Ron do this week. And part of what I've been looking at on that front, because we keep coming back to the energy price thing is we essentially have. from call it April 2025 zero net jobs and rising energy costs going on right now. And I think the last

time in the United States we legitimately had this as a backdrop was probably the 1970s, right, where you had this tankflation era. And that was one of asset prices and economic fortunes just whipping back and forth, right? Like everybody jokes, you've got bulls and bears, but that was a kangaroo market, right, where you're going to go up and back down, up and back down, up and back down. And Rahm, as you're talking about cyclical rotations between various sectors, the energy sensitivity, if that's going to bounce around as we're trying to find the political sort of solution, I think to sort of move to the next topic, doesn't this put the Fed in a very hard spot? Because to look at what is going on there, the Fed kind of has what's the

right way to say it's an impossible task going on right now a split where if you look at march fomc rates are held steady but the dot plot is a massively wide internal split right seven out of 19 i believe one at zero in terms of 2026 cuts while five one and 50 basis points or more so you're seeing the fed start to go like this and i think that would depend are you looking more at cpi or are you more at unemployment. Because being fair to them with regard to the dual mandate, they are, again, reminding everybody the mission of the Federal Reserve is price stability and full employment. And in a time like these, they are pulling in opposite directions. So when you see this kind of divergence from the Fed itself, what we're seeing here is we're in a very difficult economic

situation where both sides are legitimately having an impact. As a result, Powell is warning higher energy prices are going to push up overall inflation. It's too soon to know the full effect on consumers, but he said inflation, quote, isn't coming down as much as hoped. Inflation projections are now 2.7% for headlining core up from 2.4 in November. Gas prices are 384 a gallon nationwide, right? There's some outliers like California, but those are more local problems. Crude is coming back down. which appears to be helpful, but let's see how long it stays there. And Goldman, for instance, raised their Brent forecast to $110 average for March April.

Powell also interestingly noted that tariffs are now keeping inflation elevated, like we're having a double squeeze thanks to the supply side. So I guess my first question, which I'll put to both of you, is we've got seven hawks, we've got five doves and they are diverging in opinion. Can we tell anything from the dot plot? Does the Fed itself even know where it's going to be three months from now? I think the policies overall are inflationary. The divergence just shows the greater volatility.

What's not inflationary? Yeah, war, $200 billion in spending across, that's inflationary. TSM is raising prices. That's inflationary. Micron is passing $250 price point increases on to Apple iPhone. I got a record utility bill last month. That's inflationary. Wheat, fertilizer, corn, that's going up. That's inflationary. Like a 3% handle on CPI is quite possible. So that's the bare case for the market, by the way. Like inflation is just toxic for bonds and equities. So it's a, I do think inflation is going to be higher for longer. Nothing here is disinflationary.

The productivity of growth is the best story on the disinflation front, but I don't think it's enough. I mean, look, we're obviously seeing energy prices rock, like, you know, in the interim skyrocketing. But look, this, I think this is going to end. This geopolitical mess is going to end one way or another. So it feels somewhat transitory against the backdrop of this new AI economy that is fundamentally disinflationary, right? So I think they're in a conundrum for sure. I was messing around with the truflation stats. And like if you look at truflation, and I know we're good friends with Stefan here, it really hasn't adjusted yet. So are we missing the forest through the trees

and, you know, against this backdrop? We saw what Elon put out over the weekend and his massive plans, you know, going into space, driving AI, driving incredible innovation. And if the, if the AI dream comes true, it's going to be highly disinflationary. So, I mean, there's a case to be made that this is transitory energy shocks that are against the backdrop of a much bigger disinflationary wave. I mean, so I'll potentially take the other side of that on two points. I agree with you about Truflation's current numbers. But if you look at where the market is pricing inflation, it is not like this month,

it is on a forward basis, right? That the energy disruption causes this supply chain sort of breakdown. The other part is, as we look at where the inflation will be experienced, I think the United States is probably the least impacted in terms of a straight of Hormuz disruption, right? Like, again, not saying that I think this is a good thing for, for the world in general, but the US has both more native energy supplies and more call it local supply in our neighborhood, especially with Venezuela, somewhat unlocked now compared to many others. If you're looking at where problems should be in terms of their reliance upon oil from the

Strait of Hormuz, Japan, Korea, the Philippines, Australia, to a lesser extent China, they've got maybe more diverse sources but there. And there I think we're seeing more flashing red indicators, which to me leads to more of that chain of effects coming down the road. I think in the United States will get the least of that damage. And when it does arrive here, it will arrive on a delay because it's coming through the energy shock in other places. Another important point is the fertilizer one, which I believe we raised earlier in terms of inflation. you'll only see the impact of that after growing season, or at least as soon as the market starts to realize,

oh, it's a bigger problem than we thought if fertilizer doesn't get where it's supposed to go. But as we look at food inflation again, like Chris, you know this one well, the U.S. is very food secure from a production standpoint. Maybe corn gets implicated as a crop, but we just switch to soybeans or something else. The growth capacity of the U.S. breadbasket is world-class. the people who are going to get hurt by this are like Africa, Southeast Asia, India, China,

where food prices are going to go way up. So I guess to put the question back to you and ROM, is trueflation the thing we should be watching for inflation right now or should we be looking at, call it Asian stockings? Is the Fed care about those global impacts? I mean, it's the U.S. Fed, right? And I think you're right that the impact on the U.S. is going to be delayed because overseas, I think in Thailand, people were asked not to go to work because energy prices were so high. Asia is getting pounded. You know, countries around the world are getting pounded. The difference

between 1970 and now in this country is that we're energy independent now. And that's providing that insulation. We have a security, our geography provides security with the two oceans. We have energy security now. And to your point, we make a lot of our agriculture business, which is actually one of the most tech forward businesses. If you ever get a chance, it's like insane how technology focus these people are. Also self-sufficient. So like, isn't this all just America first in the end anyway, which plays right into Trump's plan? Yeah, I'm not sure the 1970s analogy makes the most sense. There's some echoes of it for sure. There are echoes of it. But the U.S. economy is far less energy sensitive. You know, Chris brought up energy independence. There's also a fuel efficiency,

the part of it. Just the diversification of energy, the alternative. energy sources, we get a lot more output per unit of energy than we ever did before. So that's a big change. There are also echoes of 2022. You had fertilizer and potash prices increased because of the Russia invasion of Ukraine. And Ukraine's like the breadbasket for Europe. So you're seeing some of that happen here. The biggest driver inflation is going to be around because that's great.

not only transmits energy, but also the components, the precursors for fertilizer. So that's one more thing to watch. The AI still needs time. Still needs time. You're right. People are spending apparently engineering salaries on tokens now. That's what I'm reading now. People spend $150,000 per engineer on tokens.

I don't think that's everybody, but that's what some of these AI last. If you're not doing that, you're not doing your job if you're not spending $150,000. what they're saying. That's the new message. We'll see. I don't know. Inflation is a legitimate risk, though. I mean, the tenure has backed up. And, you know, true inflation is mostly focused on goods rather than services and where a services economy. So, you know, consumers are going to look the utility bill and food prices have already gone up. And these inflation pressures were brewing even before this Iran conflict. So it's a, you know, it's a real risk. to be mindful of.

Yeah, to pile in on that point too, Chris and like what we were talking about, with regard to does the Fed care about Asia, I think the answer has to be yes because of how interconnected the global economy is now. Right. I think the last time we just totally punted on Asia and acted like they didn't matter was what the late 1990s and that caused the currency crisis over there. But like post-2008 with dollar swap lines and at everything that's gone on from a monetary standpoint, I think we do have to care. One, for that point, two, if you look at the hawkish plots of the people either saying no cuts or even hikes, they're also looking later in the year.

So I think there is some belief from the Fed side that, hey, if we see this train coming towards us, we probably should not be cutting into that. Right. And then ending up in a place where we're just going to have to massively hike after the fact, I think it all comes back around to what we were talking about of the Fed genuinely doesn't know where to go from here. Like they are trying to, for lack of a better way to put it, do this live. And it's not obvious to me that they're going to go up. It's not obvious to me that they're going to go down because I don't think it's obvious to them, right?

Like it's the running joke on Wall Street of you can't front run the guy who doesn't know what he's going to do. and I feel like that's what we're observing with the Fed right here. Yeah. The back end of the oil futures curve has moved up materially higher, by the way. So markets are expecting higher for longer here. This week is going to be pivotal. I want to see what Iran says. The ball is truly in their court now.

If they fire anything at any tanker, oil pressures shoot up, And asset prices drop. If no missiles of fire this week, then asset prices can recover. Yeah. And let's not forget, I mean, the damage to the Qatar gas fields is going to take years to repair. So we're already dealing with a state that's a market that's been impacted for a long time. And you're right. Both of these sides want ball control.

And they can do little things to take that ball control. It's going to be very interesting. Isn't Trump giving it to them though? He's pretending to have it. He's pretending to have it. I just saw a meme that Iran's a propaganda team issue. They showed a picture of a car with two steering wheels, with Trump speaking on top,

and Trump's saying both of themselves straight and four moves, and then the meme has two steering wheels. And I think Trump is, he's letting, he's giving Iran an off ramp, and he wants it. Yeah. I would think that the I would think the IRGC doesn't want more bombs to drop down on them and wants to survive. I would think that that's the path that they want to pursue. That's what he telegraphed when he said the Aitola and I will control it, right?

That they will retain. I just, there's this little country called Israel that may not find that outable. And unless the, yeah. And Saudi Arabia. Like one of the things, I know we had mentioned. this earlier. One of the things I'm not sure markets are fully pricing in is the shift in, call it political belief within the Gulf region itself. All of the people who previously were tolerating and placating the Iranians just got hit with missiles by the Iranians. I'm not so sure,

like Israel obviously has their own reasons, but are all of Saudi Arabia, you know, Oman, the UAE, Turkey, willing to go back to the way things were after what Iran just did. I'm not so certain that's true. So part of what I worry about here is that the, I know Trump is saying we and the Iranians will control it, but let's be honest, they are not the only chefs in the kitchen at this point, given what has transpired. Yep. All right. So Israel will go the line with Trump, though.

I mean, it seems like they got a strike on their. that energy plant, the second one that wasn't authorized by Trump. And Trump said, hey, don't do that anymore. And Netanyahu said they wouldn't. We'll see it. But it looked like a last call at the bar. They're like, okay, let's get a strike in there before they expected a drop in these hostilities. You're now entering, was it week four now?

And the timetable that Trump initially laid out was like four to five weeks. So, and there's a trumpet. There's a Trump put. It really comes down to Iran. You know, they use the language of respect. He said, hey, look, we need to respect us. Same language China used. And what looked like a mutual escalation tit for tat, that eventually went away.

So Trump is trying to do that here. He's going to talk, he's going to just talk his way through. it. And that's what Trump does. The gray taco. This is the greatest taco we're going to see from Trump. All right. Well, on that note, I have bad news for our audience, which is that our next sponsor does not, in fact, sell tacos. But we do have to do one more ad. And then we're going to be back to talk about AI. So we'll do that. And we'll be right back. Step into a new era of wealth. Discover Nexo, the premier digital wealth platform. Manage your crypto portfolio with confidence and control. Receive interest on your digital assets.

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make sure you're following Bits and Bips directly. We won't start publishing until March, but getting set up now means you'll be ready on day one. You can find the new Bits and Bips channels at Unchained Crypto.com slash bits and bips. You can also find us by searching bits and bips on YouTube, Apple Podcasts, Spotify, or wherever you listen. All right, everybody. Welcome back. We've titled our next segment, AI eats everything. Because what's going on is the tech titans continue to go all in on AI.

So Elon Musk unveiled a project he's calling TerraFab, which is a 25,000, billion chip fabrication facility in Austin, Texas, which is a joint venture between Tesla, SpaceX, and XAI. He's targeting two nanometer process technology, and he wants 80% of compute directed towards orbital AI satellites, 20% ground-based. No production timeline was given on that one. Jeff Bezos is raising $100 billion for Project Prometheus to buy manufacturing companies and transform them with AI. The targets allegedly include semiconductors, aerospace, and defense. There have been meetings with Middle Eastern and Singaporean asset managers. Excuse me, Mark Zuckerberg is building a personal AI CEO agent to bypass management layers at

Meta, retrieving information that normally flow through multiple levels of employees. This is part of a broader push to make Meta's 78,000 person org, quote, AI Native. And as a result, AI is eating jobs. It's even eating jobs in crypto, where there were major job cuts at Algaran, Gemini, Crypto.com, O.P Labs, PIP Labs, Masari, and more. Gemini said AI is now too powerful not to use it Gemini and compared non-adoption to, quote, showing up at work with a typewriter.

Recruiter Dan Esco pushed back saying, I see no real indication the layoffs have anything. to do with AI workforce replacement at scale, but rather saying it's an excuse and sector contraction has been the problem with job postings having fallen 80% year over year to about 6.5 per day. So where we are now is we have a lot of these things being discussed. We have AI being given as a reason for many of the job cuts, and we have people making these physical infrastructure of bets. But I'll start with this one. So Elon Musk and TerraFab. Is this a real semiconductor strategy? Is this part of Elon's rollout for the SpaceX IPO? Like, on a scale of real to not real,

where do we put this thing? I call bullshit. The whole thing is bullshit. Okay. So you need $20 to $25 billion to start a fab. A fab is one of the most complex technologies, human beings, created second to the pyramids. TSM has invested $100 billion to figure this out. Tesla doesn't have the cash flow either to pull this off. They have not figured this into the KAPX planning for next year too. They generate Tesla does about $3 to $6 billion in free cash flow. There's a range there because their Tesla auto sales are dropping quite a bit.

I like the products by, I think they're phenomenal products. So I'm a believer in autonomous driving. I believe Tesla's got the edge in the US. I'm calling a spade of spade here. But you need to finance investment with either operations or by diluting your shareholders. They're not going to sell $20 billion on the market. Unlike Google, Tesla doesn't have a alternative way to compete to get lower cost GPUs. So I don't think this is going to go anywhere.

Elon is also the only one talking about data centers in space. I've listened to quite a few credible people say that it doesn't make any sense. The technology is not there. Jensen, the CEO of Navidia himself has said that, including people from semi-analysis, which covers the category. So it seems like Elon's just trying to sell more of the future. Tesla stock's been down 25% in the last one or two months. I think I had a short on it until this morning, by the way.

I probably would be short again after it rallies, so full disclosure there. Again, big believer in the technology, big believer in what Elon's done for human innovation, right? But I don't think this goes anywhere. It's not real. On the AI side, I feel like this whole, I have to fire all these people because of AI. It's kind of just this, it gives companies an excuse to restructure without having to really explain the true reason why they want to restructure. It has very little to do with AI. It's an opportunity and an excuse. That's just the truth.

And that's the case. If your business model is not working, I'm not talking about any of those companies in specific, but you can say, oh, AI is coming. I'm going to fire my workforce and restructure, right? It's just very clean. It's a beautiful excuse. I think that no surprise to anyone on this call, this opportunity really tells me why I'm so excited about crypto.

All this noise, all this chasing the hot new toy, and we'll get into Elon here in a second. But I literally just came back from downtown in New York City where the CTO of DTCC was talking about how they're going to tokenize $200 trillion in assets. Like, come on. And that's happening in real time where we have DAS in New York this week. Every institutional is piling in. I could sense the energy in the room that's standing room only, right? And so, like, this makes me more excited to be part of crypto, which is going to be.

going to be totally integrated with AI going forward in whatever way, shape, and form it takes. I think, Ron, it's hard to bet against Elon over the years. Maybe you can do it in a very, you know, different, I guess, windows perhaps and make money. But, I mean, this is the greatest entrepreneur and founder, you know, of within generations. So I love the fact that he's thinking big. As I, as I watched this presentation over the weekend, there's a couple other cool like little Easter eggs that jumped out at me talking about how he's going to how he thinks that new breakthroughs and physics are going to unlock other things. He said quantum without saying quantum. And so those are the three technologies that I think about AI, crypto, and then quantum. It sounds

like he's starting to get his hand on the quantum side as well. You know, where do we go from here? It's also very much part of what we talked about previously, onshoreing, onshore, building chip capabilities onshore, resiliency, you know, is this our 1970s moment for energy? Maybe we need to onshore chips. And if Elon's going to do it, who else is, if it's not him? So too early to tell if it's going to be successful or not, for me, gets me very excited about so many different things, so many different breakthroughs. There's going to be, when you put all this money at AI that we're seeing, there's going to be innovations and breakthroughs that are going to like that are going to be second derivative and

be incredible that's what i'm looking for hopefully some amazing startup founders come out of it but again i like this is a crypto and macro show i get excited about crypto more and more i hear about all this so i'll hop back uh go ahead go ahead right just just just brief a few things so net engineers are being hired not fired in aggregate if you look across the entire ecosystem so you're a not seen softeninger displacement from AI. That's one. Second, the companies that are laying off the most engineers are spending the most money on Navidia and they're issuing debt to finance our cash flows. That's Oracle and Amazon and meta. This is all about free cash flow. They've got to figure out a way to pay the bills. So yeah, this is not about AI displacing human talent.

That's not happening yet. So I'll say the part of this that did catch my eye and was super interesting to me is actually what Bezos is up to. Because I know one of the topics, Rom, you've talked about on here before, is where will the value accrual from AI ultimately reside in the market? Does it reside with the model companies or does it reside elsewhere? And so as I look at what's going on here, if you have a guy who built one of, call it the two biggest manufacturing behemoths out there, which was Amazon, right, in terms of operations,

logistics, supply chains, moving goods from A to B, maybe the other one recently being Apple, which is fundamentally a hardware company itself. And he's looking at this saying, actually, the place I think will have the value accrual is applying AI to manufacturing companies are stuck in previous generation regimes. That's a super interesting signal to me. Because remember, his original insight back in the day was, wait a minute, why don't I apply the AI to this fragment, or is he not AI, the internet in that case, to this fragmented sort of idiosyncratic, not particularly efficient market called books, right, and brought Amazon into the world to massively compress margins and improve things in that space. is he looking to run that playbook again on manufacturing writ large with AI? That becomes a question to me as he's unveiling this sort of thing. So, Chris, you're an investor in early stage companies, ROM.

You're an investor in later stage stuff. Is this a sign that the value accrual of AI is not going to go to the model companies, but rather to the people implementing it to improve their own margins? Yeah, the benefits are there. It's the users, the end users. The venture capital firms are subsidizing the real economy. Financial Services firms are benefiting. We had someone on our team used Claude Co-work to pre-fill 20 subdocs with the command,

with the basic command. Those are people that we're all benefiting. Claude is losing money. They're handing valued at end of consumer because they're gaining so much share from Open AI. People are cord-cutting open AI and switching over to Claude. We've done the same. And so it's all this venture capital money. is subsidizing the real economy.

It's not this esoteric innovation like some transformation in biotechnology. It is basic day-to-day workflow automation, research. We're using it in our investment processes every single day. I'm sure everyone is. It's speed of memo generation,

investment proposal generation. So that's where the value capture is. In capitalism, consumer wins. Same thing is happening here. I would say on the early stage venture side, you know, we always are looking at the intersection of crypto and AI. And, you know, this space has a lot of promise. Projects like BitTensor and others. One thing that we're watching is, you know, things like payments. And, you know, we had Coinbase launched this X402 protocol standard. It's striking.

type release, its equivalent, MPP. We haven't seen that take off just yet, either one of those. And one of the things crypto has struggled with for a long time is, you know, it's not if you build it, they will come. I think there's some of that going on in AI as well. And so really looking to see, you know, some of that real product market fit at that intersection, you know, I think it's going to happen. I think agentic payments is going to be big. We haven't seen that evidence yet, but that's something that I'm really, really focusing on. All right. So if we're agreeing, and Rob, I agree with you that the history of capitalism has been the greatest benefits ultimately get delivered to the end consumer on that front, that like largely a factual statement. And then at least some of these announcements from firms that are in some ways, call it presaging other concerns or like avoiding the real reason for the layoffs. Do we think Zuckerberg building an AI agent to skip the org chart is going to be. a leading indicator for people in middle management, both at meta and perhaps writ large,

that your days are numbered. Because it, like Rom, to take your example, if you're eliminating a lot of the busy work, you're freeing up those employees to call it manage the work that is being done there and then communicate directly about that sort of thing. Are we going to be compressing org charts eliminating the middle management people and eliminating a lot of the repetitive work and leaving the people who are architecting and designing. Is that the source of these layoffs? Yeah.

Yeah. Well, you know, one just talking to the audience, I thought that headline coming out that Zuckerberg wanted to create an AI executive to help him do his jobs is amazing. Zuck wants to create an AI robot to run meta. We already have a robot running meta. So this is more evidence that we live in a simulation. But yeah, look, I think you're going to see more of the menial tasks go away. That's always the history of this stuff.

The toll booth collector gets disrupted. The switchboard operator gets disrupted. They move on to a higher value added, more meaningful, more satisfying work life. You know, there's someone in intensive care unit who every 30 minutes must rotate a body. That person is going to get a higher quality of life and it's going to lower the cost of care and delivery. It's a menial, thankless chore that's essential. So I don't think you're going to see this massive disruption. Like, whose roadmap is going to suddenly evaporate?

Have you ever seen technology company have a roadmap? Say, okay, we're good now. We wrapped up the roadmap. We shipped our product. We are good to go. There's always new innovation. So, you know, you will still have humans playing the role of setting vision, AI accountability, AI supervision, quality assurance, listening to the customer.

Those types of roles will and work functions will take us. more of the time. Chris, what do you think? Is this bad news for middle management at Mata? You know, honestly, people are resilient and I don't bet against people. They tend to adapt very thoughtfully to innovation and technology. When I was growing up, we didn't have like influencers. Now that's a thing.

So I think it wrong's right. You'll have menial tasks, you know, maybe travel agents. But then it all comes back. right and it comes back in a different form we're super high touch the people will want that human connection they want that super high touch person to person feeling for certain types of things once you get rid of it i'm not fuss but people are super adaptive the economy will shift birth rates going down anyway so it's going to reach a national stasis and i think it's going to be very complementary to our civilization going forward yeah and what's interesting to me is the

skill sets that it pushes forward because I have a friend for instance who's a founder in the AI space working on a product that does signals actually for supply chain disruption so wow has that been timely lately by the way echo labs if you're in that space but we were just talking today and she was telling me I don't think I'm the best engineer in the world but the job now is becoming more about architecture, more about high-touch customer service, more about understanding how to communicate and deliver things for your end clients. And she was saying, this favors me. If it was just a fair game of engineering skills, I'd have gotten my ass beat by some 12-year-old in China, to paraphrase. And I think the one thing we're not going to be able to replicate with AI is

human interaction, right? Like even if you have a robot doing your menial tasks, can it replicate the actual act of interacting with another human being. But differently, how soon will the three of us be replaced by AI to do this podcast? Well, and then what do you study, right? Do you study computer science, like the last generation needed to do? Do you study humanities now to be more effective in the workforce? You know, I think the easy answer is, oh, now you've got to be humanities major because they know how to think.

I think that's bullshit. I think you just have to be a critical thinker in whatever discipline that you want. And that will help you inform and how to best partner in your, discipline with the AI. I'm not too concerned about particular discipline losing out. I do get worried about, you know, this decline in population and just replacing more and more people with robots. It's easier to have more conflict and war when you've got robots that are soldiers. There's no real cost. And I hope we vector towards society where you continue to have humans in the loop. But if you're having more of this automated lethality,

than the cost of conflict declines, so that's my concern. When you have population growth, you have more people that have a stake in the system. People in China don't want to see their only child go to war, for example. But Lindsey Graham, who's a boomer, loves seemingly lots of different wars. he's not someone with kids that he's going to see, presumably conduct those kinds of wars.

So, you know, that's the downside from all of this is, you know, you lose the cost of the site. There's a period where Mark Zuckerberg, he made sure to harvest, hunt, or kill all of his food. He made a direct visceral connection with everything he consumed, right? So if he was going to have chicken, he took the chicken and he killed the chicken. I'm not saying people should do that, but you're going to see more mechanistic societies like that evolve, where why wouldn't you just continue conflict if the cost of it is measured in $8,000 robots at scale? And wouldn't that increase the likelihood of actors like China than invest in robots engaging in conflict also? So, you know, I think that's the, that's a risk, a real risk that we need to consider.

So that's the inflationary angle for AI then, Rom? That's the, that's the standing angle. I go back and forth. On the other side, like humans make for terrible politicians, right? Most of them you can't trust. They don't follow through what they say, you know, Trump was elected to office on a campaign of disinflation, you know, deregulation and no war. and you've got economic populism, and you've got two conflicts out there. So AI might have more accountability, but I do think you need better humans.

You know, you still need to have human supervision of these AIs. And, you know, we'll see what happens. I think in the midterms, the Dems have a real shot of taking, not just the House, but I think on Pollymark at the Senate was 5050. I think Americans want something that neither the left or the right are offering right now, which is something that is, it was a type of policy mix that Trump was offering when he ran for office, but delivered by a different personality. You're seeing the same thing with Mom Donnie in New York too, right?

Like ran on affordability. First thing he's doing trying to spend more and raise taxes. Back to your point on accountability, like neither party is doing a very good. job of that. I will say I am highly skeptical of the polymarket Senate odds because when you drill down into that and start looking under the hood, you're predicting democratic victories in places like Alaska and Texas and Senate races, which the, for those who have not looked, go look at the Senate map of where the elections actually are. I feel like that one's very much vibes and wishcasting. Like the left has been convinced that Texas is within reach for what like four

Senate elections in a row and they've just gotten absolutely punched in the face every single time. So I think part of what we're revealing here, Rom, to your point, is dissatisfaction with the status quo. I don't think it necessarily means things flip. I think what's getting interesting to me, and like I have students in classes, so I see the onward march of this. And if you're a politician and you're listening to this, pay attention. Both political parties are becoming increasingly unpopular over time, which opens the door for much more radical change than you might expect. Like if you're an incumbent in either party, lots of people really don't like you. Yeah. Yeah. Look, if you're a renegating your own party, you're also more popular.

Look at Federman on the Democratic side or look at like Anna Paulina, who's advancing disclosure on issues like UAPs or Thomas Hassee who's leading on Epstein disclosure. those folks are renegades in their own party, but they are gaining more funding and more national recognition. All right. Well, on that note, because we are slowly cruising towards the finish line, I will hit Chris with this one for our lightning round. Chris, if you were betting on Pauley Market, Republicans or Democrats for the Senate.

I think Republicans still. I'm with Chris too. I think once the, uh, the, uh, things settle with the war. You get oil down a little bit. Gas prices come down. You get the Clarity Act, which I'm excited about, maybe just me, which I think is happening now. I'm up like from 51 to I'm around 55%. I think it happens. We had some, I knew this interest thing was going to get sorted completely. Now it's just a matter of the horse trading as we get to the finish line, which could go in either direction. But I think the Republican stay in the Senate, probably House goes to the Democrats.

All right. So there you go. We're three for three on that prediction, which is dangerous. So on that note, we will end here for today. So thank you for joining us for this episode of Bits and Bips. We'll be back in one week to discuss more about how the worlds of crypto and macro are colliding. Until then, everyone.