The Wolf Of All Streets – Macro Monday:

Episode: Bitcoin CRASHES To $85K As Global Recession Fears Set In! What's Next?
Date: December 1, 2025
Host: Scott Melker (absent; discussion led by regular panelists: Dave (A), Mike (B), James (C))
Theme: Dissecting Bitcoin’s dramatic weekend crash, macroeconomic drivers, and the interplay between liquidity, central banks, and market structure as 2025 closes.

Episode Overview

This "Macro Monday" episode unpacks the dramatic crash in Bitcoin’s price to $85,000 over the weekend. With Scott Melker out, regular macro commentators Dave, Mike, and James dive deep into the roles of leverage, the evolving macro environment, gold’s surge, and shifting central bank policies. The panel provides a high-level yet granular analysis of the global financial backdrop, market structure idiosyncrasies, and what it all could mean for the rest of 2025 and beyond.

Key Discussion Points and Insights

1. Global Macro Backdrop & Fed Politics

• US Fed Appointments: Discussion about Anna Wong’s prediction of Kevin Hassett’s likely ascent to the Fed, signaling possible shifts toward productivity emphasis and reform.
  • “She does think he will be the next Fed governor... probably start influencing the Fed and the market starting in January...” (B, 01:16)
• Market Outlook: Slower Black Friday growth (2.3% vs. 3.5% real growth prior year). Expectation for a more dovish Fed, upcoming rate cuts likely.
• Gold’s Unusual Rally: Panel notes, “Velocity of the rally this year in gold is only happening once or like three times or so in the last 50 years but it’s never happened with stock market volatility getting buried...” (B, 03:54)
• Commodities & Crude Oil: Bearish sentiment persists; crude oil and grains seen as trending downward.

2. Japan’s Yield Shift & the End of Free Liquidity

• Japanese Yield Curve: The shift of the Japanese 10-year yield up to 1.87% is identified as epochal, signaling “the era of borrowing from Japan for nothing is over.” (C, 05:49)
• Implications: Removal of global “free money” forces risk repricing, with fast-paced moves most evident in bitcoin due to 24/7 trading.
• Yen Strength/Dollar Weakness: Dollar expected to trend lower as yen strengthens and global capital flows realign.
• Algorithmic/Structural Unwinds: A large part of the bitcoin crash attributed to end-of-month, algorithmically-triggered risk-off moves, not systemic carry trade unwinds.
  • “It looks like it's a structural move... trying to take an elevator down and kind of stop in between floors…” (C, 15:01)

3. Leverage, Liquidations, and the Bitcoin Crash

• Leverage Overview: Only about $700 million in bitcoin liquidations, which is “very thin” for such a sharp move.
• Idiosyncratic Price Action: Panelists agree the drop seemed isolated to bitcoin, not broad asset contagion—signs pointed to “manipulation” and opportunistic desk moves over the low-liquidity weekend.
  • “This is the sort of thing that is manipulative... if it were a regulated market... it would be called manipulation and someone would be getting investigated for it. Now, in the crypto world, there are no regulations...” (A, 29:52)

4. Liquidity Cycles vs. Four-Year Bitcoin Cycle

• Bitcoin as the “Tip of the Liquidity Spear”: The panel challenges the relevance of the classic four-year cycle, arguing that the real driver is global liquidity, not just halving mechanics.
  • “I just think the four year cycle for Bitcoin is over and we are... in a period where… it is the tip of the liquidity spear.” (C, 20:48)
• “Zoom Out” Mentality: Long-term bitcoin thesis (hard money immune from central bank debasement) remains compelling but requires patience amidst acute volatility.

5. Political Landscape & Economic Policy

• Inflation & Elections: US fiscal deficits seen as politically unfixable (“They are mathematically trapped. They must add liquidity or we don’t have money to buy the bonds…” (C, 39:11)), and inflation is the top voter issue.
• Gridlock as a Bullish Signal: If Congress remains gridlocked post-elections, markets may actually like the stasis.
  • “Markets love gridlock.” (C, 65:45)

6. Risk Assets, Treasuries, and Gold

• Gold Outperforming: Shift in preference to gold as a global risk-off asset, especially with central banks buying. Gold’s momentum likened to “hot ball of money” chasing assets.
• Bitcoin’s Relative Weakness: Bitcoin/gold ratio “broken down,” and bitcoin now trading at a significant discount to its moving averages.
• Treasury Commentary: Treasuries described as a “melting ice cube.” Debate over whether the US 10-year will drop from 4% to 3% (as Mike predicts) hinges on the stock market’s direction.

7. MicroStrategy and Trading Strategies

• MicroStrategy as a Leveraged Bitcoin Play: With price near all-time lows vs. bitcoin, the panel considers MSTR a higher-beta bitcoin proxy but cautions about exacerbated downside in a drawdown.
  • “If Bitcoin drops, MicroStrategy is going to drop more.” (A, 67:40)
• Leverage Caution: Strong warning against trading leveraged Bitcoin products for non-professionals.

Notable Quotes & Memorable Moments

• On Japan Ending Free Money:

  “The era of borrowing from Japan for nothing is over.”
  (C, 05:49)

• On Volatility and Bitcoin’s Unique Positioning:

  “When risk is repriced over the weekend, what gets repriced first? Of course Bitcoin does. It trades 24/7, it’s going to get repriced.”
  (C, 07:13)

• On Poor Explanations for the Weekend Crash:

  “People always desperately… search for a reason. What happened over the weekend? Well, the answer is… someone orchestrated, looked at what was going on… this is the sort of thing that is manipulative.”
  (A, 27:03/29:52)

• On Political Reality and Inflation:

  “They are mathematically trapped. They must add liquidity or we don’t have money to buy the bonds that we’re issuing to pay the debt that we refuse to give up. That’s the issue.”
  (C, 39:11)

• On Asset Ownership & the K‐Shape Economy:

  “If you do not own assets in this country, you’re going to be left behind."
  (C, 39:11)

• On MicroStrategy as a Trading Proxy:

  “If you believe Bitcoin is almost bottomed out and you want a little bit of extra juice, then MicroStrategy would likely be one of the names to hold.”
  (C, 66:54)

Key Timestamps

• [01:04] – Global morning market wrap: Fed politics, Black Friday data, equities, and gold
• [05:49] – Japan’s yield hike and its effect on global liquidity
• [11:53] – How end of Fed QT and misunderstood liquidity flows triggered leverage shakeout
• [17:32] – Recalling August 2024’s yen carry trade blow-up and market caution
• [20:48] – End of the Bitcoin four-year cycle? Bitcoin as a liquidity barometer
• [27:03] – Market narrative chasing vs. actual drivers (manipulation and liquidity)
• [36:05] – Macro cycle worries, political incentives, and fed stacking
• [39:11] – Structural deficit trap, inflation as top political risk
• [47:25] – Black Friday sales: Consumer health and strategic buying
• [52:13] – Gold and Treasuries: The evolving “risk asset” definition
• [58:53] – Structural shift in global demand for US treasuries vs. gold
• [66:54] – MicroStrategy as leveraged Bitcoin exposure; risk warnings

Tone & Style

The discussion balances expert macroeconomic analysis and market structure with traders’ on-the-ground observations and a wry, skeptical take on media narratives. Panelists are frank, intellectually rigorous, and sometimes blunt—repeatedly advising caution to those using too much leverage.

Takeaways for Listeners

• Bitcoin’s weekend crash was more structural and levered, not systemic or driven by exogenous macro panic.
• Global liquidity environment is shifting fast—Japan’s policy pivot removes “free money” but increases pressure on Western central banks to supply liquidity.
• Gold is surging as a favored defensive asset amid structural fiscal and monetary problems.
• Caution is warranted for non-professional traders—volatility is likely to persist and big swings can be engineered by a small set of market actors.
• Election-year politics will likely drive monetary easing, but structural debt traps mean genuine solutions are elusive.
• Long-term Bitcoin investors should “zoom out” and not overreact to short-term volatility, but be prepared for continued turbulence.
• MicroStrategy offers levered exposure to bitcoin but comes with heightened risk on drawdowns.

Final Thoughts

The episode offers a sophisticated, clearsighted look at the interplay between bitcoin’s idiosyncratic price action, global liquidity shifts, and the political economy of central banking as we head into a pivotal election year. The panel agrees: while narratives swirl and short-term volatility reigns, the underlying drivers—liquidity, monetary policy, and political constraints—still call for humility, discipline, and a long view.