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The Wolf Of All Streets
Trump Pumps Bitcoin: Is The Crypto Strategic Reserve Finally Coming? | Macro Monday
01:02:15
Trump Pumps Bitcoin: Is The Crypto Strategic Reserve Finally Coming? | Macro Monday
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- [00:02]
Scott Melker
We had another one of those exceptionally boring weekends in crypto where nothing happens. Or we had Donald Trump go on Truth Social and say that there's going to be a strategic crypto reserve including assets like xrp, Cardano, Solana and then oh by the way, in a tweet a little bit later, we'll also probably have Ethereum and Bitcoin. If you had any doubt that Donald Trump's actions and words control the crypto market, then think again. What he does pumps and dumps the market back and forth, for better or for worse. Even in the face of macro, which is our conversation every Monday, I cannot wait to have this talk with Mike, Dave and James here. Macro Monday, let's go, let's dope. What is up everybody? I'm Scott Melker, also known as the Wolf of Wall Streets. Before we get started, please subscribe to the channel and hit that like button. Gonna bring on the gentleman. Right now we've got Dave, James and Mike. Not a boring weekend. We love our Sunday news. But I'm gonna first give us a table setting here and go to Mike who is in Bill Bar Height's living room. It's my favorite background that Bill Barheit always uses with piano and break down what happened in the morning meeting just to sort of give us some context for our conversation.
- [01:34]
Mike
So I'm in the great state of Indiana this week. I'm going to the all day Ag Outlook tomorrow. It's the best conference on the planet. The food, it costs 40 bucks and food is worth 50. But the key thing about the morning meeting is significant. I'm glad we're starting. There is our two chief strategists, our female strategists. I have nothing but the most respect for Anna Wong and Gina Martin Adams just came out swinging. So if you're bullish risk assets, you probably should listen to them. Anna thinks the non farm payroll number is going to shoot to around 65 and the shock risk is it's going to be weak for key reasons were bad weather, expiration of pandemic stimulus and Trump's funding squeeze. She's pointing out that the states are forecasting 6% funding reduction. This is typically a time of year you build payrolls. But she's pointed out big brag on payrolls. Fed funding potentially decreased in the states. Could be a massive negative number for payrolls. You know it was two months ago, she nailed it. So I'm honest swinging hard that we're going to have a weak payrolls number might last a little while. The Same time Gina Martin Adams who's been again in my, you know, I just borrowed her general direction having nailed this stock market rally for years, says sentiment is too exuberant. It's maniac Earnings working against the cycle 2024 have been marked peak earnings too much earning optimism. The Mag 7 lost all leadership. Only met is still hanging in there. Home builders are breaking down. Consumer sentiments turning downward. We're losing cyclical momentum and only the financials are powering forward. So from the morning meeting, quite the bearish outlook from US Economic expansion standpoint and I'll just put my view in is I think it's an example of the extreme optimism of a. The return of President Trump to admin to the presidency is turning over into just a normalization the realization that the world's largest demand pull money printing machine on the planet's cutting back significantly. Expect some difficult discombobulation in risk assets.
- [03:37]
Scott Melker
Yeah, the fiscal, what about these guys though?
- [03:39]
James
Fiscal dominance. Yeah, the fiscal dominance has, has ended.
- [03:43]
Dave
Right.
- [03:43]
James
So they're just not spending hand over fist out of, out of D.C. anymore. We saw the, if you look back at all the, the hiring numbers, the jobs numbers for the last two years, there were massive amounts of the, that those numbers are coming out of the government. Right. The huge percentage of, of the hiring was coming out of the government. So it's a big deal. And I, and I, and I think Anna's right in, in that we're going to see a couple surprises out of this. The question is what what's on the other side of it and whether we can have deregulation and unrestricting companies to hire and expand their own balance sheets. If that's going to be some sort of offset. It's going to take some time though.
- [04:27]
Scott Melker
Yeah. Just before we go to move on to Dave into other topics. I mean Mike, I just showed this but Zee prepares to unveil China stimulus plan as trade war heats up. Saying they're still going to be repeating it. The bullish growth goal of about 5%. Good luck. And of course Trump's ever rising tariffs will challenge the impact of this stimulus. But we may be in a period of pseudo austerity here with Doge in the United States. But China is about to print like never before.
- [04:54]
Mike
So they have. That's, I'm glad you brought that up. That's a key thing to remember about China. You have to expect massively increasing fiscal monetary stimulus just for risk assets and markets in that country to just remain stable. Stable. So those of us remember trading JGBs Japanese government bonds 30 years ago when they were collapsing and everybody says, oh, they're bot. I mean I, I've seen this before. 1.77 so percent on that Chinese tenu note yield. China's collapsing. Now you're seeing the only reason they're staying upward is because they're still able to export a little bit massive fiscal monies to your stimulus. But you have to depend on it. And now who are they going to export to? We have Germany's hurting like third year now heading towards recession. UK heading towards recession. US is cutting it off. This fortress North America that Scott Best mentioned with China, with the U.S. canada and Mexico all ratcheting up exports in China. Let's not underestimate what's happening in this country. And then I just enjoyed the estimate. What I've learned from some people, really, you know, from my colleagues pointing out, by the way, we have a country of only child. Children, only children and the population is declining. There's a little bit of a psychology there that's just very negative. And all I hear is about hoarding and saving as much as possible. They have to stimulus just to stabilize, to stimulate. And I look at that as, and I also point out from a commodity standpoint, you have to depend on China stimulus. You have to depend on more cuts from opec. You have to depend on less supply in terms of crude oil and grains and stuff from the US Otherwise we're gonna get with commodities normally go lower. And that's, I have to tilt over to what I know best. I see pretty significant forces kicking in, particularly if the US stock market just has. Yeah, maybe it gets to that 200 day moving average which bitcoin did last week. It was a perfect technical little backup.
- [06:44]
Scott Melker
I do have to say, listen, we had the, we had the debate many times, Mike, and we kept saying why not Ethereum 2000. There we go, we got Ethereum 2000. Pretty damn close. So yeah, we did get 200 ma on Bitcoin on the daily chart. One of the craziest weekly candles you'll ever have. I think we opened the week at 96,000, dropped as low as 78,000. So an $18,000 spread and closed right back at 94,000. If you literally fell on your head last Sunday and woke up yesterday, you wouldn't know that there was any volatility in bitcoin. You had basically almost a $20,000 candle and opened and closed within $2,000. I mean, Dave, insanity.
- [07:25]
Dave
I mean, I want to comment on the week and I Want to talk about the fact that it is not priced in what happened yesterday? It's not even close. But I think it really needs some commentary on what Mike and James just said. So first, the most majority of what Mike's strategist or the Bloomberg strategist saying I agree with, I think the economy is going to be weak and going to sustain weakness. I think that in the trenches people need understand how the, the Musk stuff and the Trump stuff is being, is being portrayed by the actual people in the government and how the states are reacting. And that is significantly larger than most people think. So we have a family friend who, whose son it was getting close to was over a year into his two year FBI training as an agent. His managers, because he was on probation, his manager said, well all people on probation are at Therefore if you hit the resign button, you don't have to pay us back the $55,000 that you'd be getting that you would ordinarily have to pay back if you quit while we're training you because they put a lot of effort into training agents and you'll get paid through September. But if you don't and we fire you, you get nothing. Meanwhile, you know, he has expenses etc. So we hit the resign button. Now I am very confident that Elon Musk's idea was not to take highly trained, expensive people who they're going to want and have them be gone. But that is exactly how it's gotten implemented. So all the people who are being trained throughout the federal government for technical and other jobs, there's going to be a massive shortage. They're going to be rushing to hire these people back in a little while because it's well they actually want. But the, the amount of money that's going to come out of people and the amount of job losses are going to be severe. That said, when you at the end of the day and the dust clears, you're going to have a situation where you have significantly less drag on the economy. Because the other thing that is very true is economies. What's the biggest drag on any economy of spending. It's called fraud. So we have a lot of money. And if you read, if you listen to what Elon was talking about over the weekend in terms of the NGO fraud, if anyone who's listened to Mike Benz over time knows that billions, we're talking hundreds of billions of dollars have been getting stolen to go to a lot of it ending up in politicians and politicians families hands that money is all going to get deployed for Productive use. And that is a very big deal because the one thing this administration does not want is they do not want to, you know, bring down the economy. What they want to do is deregulate and have private hiring. But they're not necessarily talking about a budget. That's a decrease in a deficit. It's just not true. So you're going to see this now. At the same time, the Fed is going to have every opportunity to say, oh, wait a minute, look at all this weakness. And so I euphemistically would be joking. You know, printer is coming, you know, there, you know, James may say, be saying fiscal dominance is ending. That's not, absolutely not true. There's no projection of a balanced budget without something around 10 growth. Right. Which we're not.
- [10:36]
James
What I meant was that the, the, the, the fiscal driving of the US Economy is kind of ending. So we're gonna, you know, it's gonna have to be picked up somewhere. And that may be, it may be just an added liquidity. But we, we know that Trump is not, he's not going to stand for the market watch. He's gonna do whatever he can to juice the market because he looks at the stock market, he talks about the stock market almost every single day of his administration. It's a level of his, you know, it's kind of a measure of his ego.
- [11:07]
Dave
Well, I mean, yes, although I think that they, they understand that there's going to be a step back before you get a step forward. My point is exactly. We're talking this show, let's face it, our audience is mostly crypto. And so I've been talking about what could cause bitcoin and crypto to D link from the absurd earnings expectations of the stock market since we started this show. And I'm basically laying out a thesis that it is going to delink in 2025. That is really what I think. And I think when I say crypto, I do not include memes, I do not include bullshit. And we'll talk about that.
- [11:40]
Scott Melker
Sorry, I don't mean to interrupt, but when you have a $18,000 Bitcoin candle spread, altcoins having 60 to 70% volatility, downside and back up, aren't we delinked? That didn't happen in the stock market last time.
- [11:55]
Dave
No, well, that's kind of my point. My point is a lot of the action is delink. But let's understand, and we're going to get into it later, price drivers. When you have news over the weekend, then the dominant Price setters are the speculators, the leverage speculators in the Bitcoin market. The dominant price setters in about 15 minutes in Bitcoin for the rest of the day are going to be institutional flows because that's what's been the dominant price setter for, for, you know, all. And, and there's going institutional flows into Solana and XRP and maybe even Cardano and we'll talk about that. But I just, you know, on the macro side, I just want to lay out my macro thesis. My macro thesis is that the stock market, which depends at the end of the day, has to depend upon earnings. Right. You know, are they, are these companies, the big companies going to be the biggest beneficiaries of Trump? And the answer to that is a resounding no. Because deregulation helps level the playing field and creates disruption, innovation and allows competition. And so to assume that the largest company, the so called Mag 7, are going to be the ones that make the most money out of what's going on is I think wrong. Now these things take a lot of time. This is not a one week sort of thing. But you need to understand that the, the stock market writ large is different than the stock market under a financialized world where the only people who make money are the biggest companies. I mean, you know, it really is that if you look at what they're trying to do, they're trying to free innovation in AI, they're trying to free, they want American manufacturing. Who are the American manufacturers that benefit from a reboot of American manufacturers? Seriously, who? I mean, Mike, you know what companies, if Trump is going to figure out a way to reboot American manufacturing by make getting rid, working with states to effectively get rid of the enormous amount of red tape that makes it more expensive to create rolled steel in America than to ship coal and iron to Japan or China and have it returned back over the ocean back to us, which of course is absurd, but we.
- [14:06]
Scott Melker
Still need materials from those other countries. We live in a global world now.
- [14:10]
Dave
I understand, but we're one of them. But we are one of the most, if not the most self sufficient natural resource countries the most. And so that's it's worth understanding. The point on all this is, is that when you invest you have to understand what the drivers are. And you know, I, I have a very strong inner bias to agree with Mike on the stock market and I have a very strong inner bias to think that, that we are reaching a very interesting moment in the history of bitcoin and Those two things are colliding. So. So let's just talk quickly about why this announcement is a big deal. I'm going to start with Eric Trump, because Eric Trump is crowing about how cool it was that. Yeah, exactly. This is the tweet. Now, let's think about this. It's like a fine wine. Let's kind of, you know, you know, understand and appreciate the notes in this. In this tweet. What is he actually saying? What he's basically saying is, isn't it cool that dad can manipulate the market because the only people who are going to respond are the degens who are going to, of course, be crazy in what they're doing. That's really what he's saying. You know, this was designed for maximum market impact, and you have to. You have to appreciate what that means.
- [15:26]
James
Just like.
- [15:27]
Scott Melker
Just like launching a meme token on a Friday night.
- [15:29]
Dave
It's. It is. It is what. It. It is that. It is also, however. It is also, however, very clear understanding that something that you and I have both said and I said, I've said this on this show multiple times. If one invests in a product and one trades a product without understanding that the single most powerful human being on the planet wants you to win or wants you to lose, you. You got a problem. You have to be cognizant of that. It's just like we always said, don't fight the Fed. Right? Why? Well, because if the Fed pulls all the liquidity out of the stock market, everything's going to go down. If they throw a lot of liquidity in and say, you know what? When you have the President of the United States wanting an asset class to do well as a barometer of his success, don't be on the other side of that trade. And that's something we've said before, and honestly, I don't really care about that so much as legitimizing the asset class in people who are willing to follow along. And so that's really what's happening here.
- [16:31]
Scott Melker
Yeah. There's so much to unpack here. Just so we don't take for granted that everybody actually knows what the news is, I'm assuming you don't live under wraps, but on Truth Social, Donald Trump, basically, I don't know if you call it truthing or tweeting. I don't know what you do on Truth Social, but he basically announced that the US Crypto reserve will be coming. A lot of people mistook this for a new executive order, but to be clear, this is part of the original executive order on crypto. But in this case, a he said crypto reserve for the first time ever. Right. We had strategic asset stockpile. We had a bitcoin mention, and he said xrp, Solana and Cardano would be included for those who aren't keeping up. David Sachs, very early investor in Solana. Charles Hoskinson, close to the administration now with Ada and of course Garlinghouse and Ripple giving a ton of money. So a lot of people pointing to those things is the reason we would have these three. You went on later to say. Oh, right, of course. Bitcoin.
- [17:22]
Dave
Yeah.
- [17:23]
James
David Sachs also said he sold everything. Right? So.
- [17:25]
Scott Melker
Right. So maybe he had. I mean, it's possible. So I'm just saying that's kind of driving the narrative behind why a lot of people are assuming that these are the assets. But today's point, this happened on a Sunday. It's the first time we're really getting crypto reserve. And of course, it's sending bitcoin max splits into mental gymnastics to figure out why these other assets exist. You guys might not remember this, but I literally tweeted this over a month ago. Strong rumor. Don't shoot the messenger, but hearing it through reliable channels, the strategic stockpile they're discussing as bitcoin and xrp, not a joke. I knew that because I saw the. The private chats of bitcoin maximalists who are close to the administration freaking out and not talking about it publicly. But here we are, James. Like, we have a reserve.
- [18:07]
Dave
Yeah.
- [18:07]
James
Let's also add, though, that he followed up because of. I think maybe because of a lot of hate that he got immediately on that. On that post, he followed up with another tweet that said that Bitcoin and Ethereum would be at the heart of the reserve.
- [18:21]
Scott Melker
Right. Which I think he just, you know, listen, he doesn't like, plan these things, but I think everyone's default was he was adding these to Bitcoin and Ethereum, or at least to Bitcoin. Maybe not even Ethereum wasn't default. But the point is, listen, like, I kind of tweeted this. Do you need a strategy for altcoins moving forward? It seems like a reasonable one is just buy whatever Trump talks about or whatever World Liberty financial purchases. So the reason, the exact same reason Dave just said, right. If there's a personal incentive for these assets to go up. But I mean, James, listen, you're. You're the closest to bitcoin maximalist we have. Like, what do you think of these other assets? Being reserved. Listen, I love altcoins. I don't think any asset should be a reserve asset beyond Bitcoin. It makes no sense. We should just start adding tech stocks.
- [19:01]
James
Exactly. So, you know, the having other assets that are, that are basically securities as, I mean, why wouldn't you put Apple in there? You know, why wouldn't you put Nvidia in there? It's, to me, it's not any different. And so the only digital asset that we have is, true digital asset that we have is Bitcoin. That's the one that is, it can't be manipulated. We, we all understand this on this show. It's funny because even, you know, even Peter Schiff had tweeted about this yesterday saying that. And I think that maximalist got this a little bit wrong too. They're like, oh, Peter's become, he's a bitcoiner. You know, because you said, I understand the argument that bitcoin is digital gold. Gold should be a strategic reserve asset. So the argument is that Bitcoin should be a strategic reserve asset. I understand that. I do not understand how there's any argument for any of the other alternative coins like the altcoins or any of the other cryptocurrencies to be included. And so of course, a lot of bitcoiners kind of seized on that tweet saying, he gets it, he's going to be a bitcoiner. He does not get it. He's not going to be a bitcoine. I spoke with him, I spoke with him privately for a while in the green room after, after a pretty heated debate down in New Orleans. And he has no, he has absolutely no interest in supporting Bitcoin any way, shape or form. He, he, he cannot stand it, but he understands the argument that we have for it. So just to be clear that that was, that was something that developed yesterday. But yeah, and that, and you know, in, in that way, I do believe that Bitcoin is digital gold 2.0 plus and it's so much more than that and it will become money. But the, the, the argument to have to include any of those other securities, it just doesn't make any sense to me. I agree.
- [20:58]
Dave
Okay, first of all, they're not security, so let's, let's, let's.
- [21:01]
James
Right now, I, I, I, I, I'm. You, you understand where I'm coming from?
- [21:04]
Dave
No, I do. Look, I think, I can't remember who it was, so I'm going to be paraphrasing, but there are a few interesting tweets the one there was one. It might have been Nick. I don't know. Anyway, look, the argument is very simple and I don't know I'm not going to make any, any personal decisions on on whether it's right or not other than to say I don't fight things. I expected this. If one looked at my portfolio one would understand that I expected this because I have Solana and XRP as my next two biggest holdings. Ether is pretty far down the list for a bunch of reasons. I do with roughly a parapassu with Cardano believe it or not. But that's how I've been positioned for a while and so am I doing okay? Fine, whatever. Yesterday was a good day. Do I really care? No, because what has to happen is what happens in the future. But the reason the argument is something that is important now. The argument is that layer ones that will get used for applications, Apple is an application if you think about it. Layer ones that will get used for applications that will be fundamental in verticals going forward that will be transformative whether that be financial, whether that be art, whether that be real estate, whether that be, you know, music, you know, whatever. There's lots of verticals where people tokenization of anything, right? Yeah, that's right. So if you listening to you know, the Larry Finks of the world talk about tokenization of everything and you know all of the systems in the Internet of Value are going to be using different base layers that are more, you know that that win then having stockpiles of those things might make sense now do I think it's premature? Yes, I do. Because there are no applications that have been built yet. Is this, you know, attempting to kick start that and give advantages to people who just happen to also be in the administration around the administration or whatever? Yes, but the concept of, of, of having you know, of owning that, you know, in the same way we have a. Everyone knows about the Strategic Petroleum Reserve the same way we have a strategic cheese Reserve, it could actually make sense. But it is what it is. I mean, you know, if this is something that's going to happen, it needs to be built upon that. It's the same concept of if someone said to you you could own a piece of TCP IP and have a tiny little toll every time someone uses the Internet, would you own it? That's the argument. And whether you agree with it or not, that's the argument. It can't be just.
- [23:43]
James
But, but we don't know is going to win in this argument. We don't know.
- [23:48]
Scott Melker
Right.
- [23:49]
Dave
A hundred percent.
- [23:52]
Scott Melker
It's betting on 20 TCP IPS and hoping you get the winner.
- [23:55]
Dave
That is correct. So that I completely agree with that. And, and I don't disagree with that even slightly. The point is that. But that is what we're facing and that's, that's the arguments. But when you look at it from a bitcoin perspective, it's really, it's, it's far, it's far simpler.
- [24:11]
Mike
The.
- [24:12]
Dave
There, there are a couple of options for doing this. There are, are three different options for building a bitcoin strategic reserve that might happen. Okay. The one that everyone focuses on, the US may buy some. Okay. I actually don't think that they will necessarily, but it doesn't matter. There are two.
- [24:29]
Scott Melker
They would have to buy. They would have to buy xrp. I don't think they have any.
- [24:33]
Dave
Yeah, that's right. But there are two.
- [24:36]
Scott Melker
That's not, I don't think that's on the list of assets. One of these, it was either ADA or XRP is not on the list or Solana is not on the list of assets that they, you know, have and would basically just be able to transfer over. So when it was just bitcoin, there was the argument which you're about to make that we could just hold the bitcoin. That's already.
- [24:51]
Dave
No.
- [24:53]
Scott Melker
Yeah. Because now we got to buy it.
- [24:55]
Dave
Okay. So there are two other ways they could acquire bitcoin. Right. And I'm fairly confident they're going to do both. Option number one is do what Texas is doing. You, you play a tax game, you say you can pay your taxes. And this by the way applies to Solana, this applies to xrp, this applies to Cardano. They're going to say you can apply pay your taxes in these four cryptos and, and you don't have to pay capital gains on the disposition of that. So if you have appreciated crypto, you could pay it full. It is. There is tons of precedent for this. Most notably the fact that if you donate to a charity, you can donate the full amount of it and get the full write off. So we know that that's true. It is highly likely that that will be the compromise that comes out of all of this. And think about the implication of that because that makes sense. That way the US dollar, US government doesn't spend a penny of the deficit and they don't lose anything. And oh, by the way, as this is happening, the prices will almost certainly be going higher. So that's number one. And I strongly suspect that that's what they're going to do unless they're dumber than I think they are. And I think these are actually quite smart people who are doing. Who are the ones who are whispering.
- [26:10]
Scott Melker
Give us two, because I gotta ask Mike a question in a minute.
- [26:13]
Dave
Bitcoin, it applies. There was just a research paper out, but it's something that we already knew, peer reviewed that pretty much is dispositive on the fact that bitcoin mining is very useful for grid stabilization. One of the biggest pieces of infrastructure that this administration needs to start tackling or we're in deep, deep trouble, is our national electric grid, which is in serious trouble and seriously under capacity. Particularly if you want to do, you know, wanted to do some of the stuff that Biden want to do. This should actually be bipartisan. How in God's name is it are we going to stabilize the electric grid? About the federal government doing significant investments in electric grid infrastructures and the most obvious one of that is for the federal government to push into bitcoin mining. They have tons of extra data center space that's been built over the years. They have access to stranded energy and they're going to be investing in the electric grid. I would expect to see bitcoin mining being part of the, the governmental portfolios, even if it. Because it's dual use sort of thing and no one's talking about that. But yeah, the data is incredibly strong on this now. They don't want to compete with private industry. I understand that. So it might very well be public private partnerships that will implement it. But you have to believe that that proof of work mechanism for stabilizing grids is going to end up creating that entry point just like the, the government of Bhutan. I'm not saying Bhutan is the leading edge here, but that their way of accumulating bitcoin is via mining. I think that you, I would be really surprised if we don't see that.
- [27:49]
James
But let's, let's come back and we got to hear from Mike because we, we just keep running over on each other here. But there's. For everybody listening there, there's paths that are very fast and those are executive order paths. They can happen instantly. And then there are legislative packs paths and they will take forever. And no matter how much, you know, the, our current administration wants to railroad things through legislatively, it's not going to happen. I was, I was talking to Senator Lummis about this in New York City just a couple days ago and the reality is that the vast majority of congressmen and senators. They don't understand what we're talking about here today. They have no idea. And the, the, the, the amount of education that's going to have to occur to get support and to get votes on something like the Bitcoin act is going to take time. It's just reality.
- [28:47]
Scott Melker
So even close, see, they're not even close to getting this passed. You can tell it now in the words, you can tell it in the way this is being discussed. You can see it being rejected by the first five states that have had the opportunity to do it, while Lummis is still saying this is most likely to happen at the state level and not at the national level. So we have to just basically do it on the Trump executive order right now, to your point. But Mike, this is what I want to, this is what I want to know. So you see this price action on bitcoin, right, over a weekend, effectively, or even throughout this week, right? This massive correction, Everybody calling for 70 new bear market. One tweet or truth and we're back up to where we started, right? So how do you put that in context of focusing on macro and this being just another risk asset, we can have so much volatility even within the context of basically nothing happening in the macro. It's hard to make an argument that what happened with Copper this week was the reason that we saw this bitcoin retracement.
- [29:44]
Mike
For example, the biggest bounces happen in bear markets. Bitcoins unchanged on the year. I think, Dave, I say good luck, Dave. I think you're going to be fundamentally wrong that when the stock market goes down, things like Dogecoin, Shiba, Inu gonna lop zeros off the valuation. All these things. To me, the cryptos markets are indicative of dot com bubble almost exactly peaked 25 years ago today. Yes, I enjoy these tweets from Trump. I'm glad they're picking winners. And there's only Good news. There's only 34, 000. Listen to coin market cap. It used to be 12 million. They changed that, I think because people like me were making fun of it too much. How's history going to judge this, gentleman? How's you going to judge this? It might be good in the short term, but our government, our president, who was smart enough to tilt and realize that yes, this technology is awesome. Why is the, you know, tether, the US dollar, the number one traded crypto today at 166 makes you know what billion on a one day basis of trading? Because the technology is awesome. But now we're talking about pets.com valuation prices that are just shockingly expensive. History is not going to judge as well. We need to at least see. Let's get. Let's, let's talk. Agree to adjust our views when the S P500 at least kisses its 200 day moving average. Hasn't done that in a year and a half. It'll do it just like bitcoin did last week. And don't underestimate what the space is. It's tremendous for trading buy low. We got low last week. It was great. 200 day moving average, we got high last year. It was great when everybody got extremely enthusiastic. But I would say allocate into this space maybe other than bitcoin is digital gold is just silly. And I say good luck because you're investing in things that have some of them have no value, no earnings and they're just extraordinarily expensive. And we saw what happened after the dot com bubble. Yeah, it turned out great. Amazon was great after it went down 90%. So I know you got to interrupt me Dave, but this is silly. Good luck when we get.
- [31:39]
Dave
I'm not interrupting you. I actually agree with you.
- [31:41]
Scott Melker
Yeah. In context of that Mike, the only thing I would say is that you know the difference between the dot com bubble is that we have like a dot com bubble every 24 hours in this space. These things, the 12 million that you point at don't need like an entire bubble to burst because they're their own bubbles. They're built that way. Right. They just go up, they're down. So those 12 million things have already gone to zero. Which is why Coin Market Cap has to delist them. It's not like most of these assets that you point to have retained value. Even the 35,000 that are listed, I would venture most of them are over 90% off their all time highs.
- [32:14]
Mike
So let's look at existing trends that we pointed this out before. What stops bitcoin dominance to going to 90%? What was the last peak? The 74%. We need to see the normalization in the stock market. That's the most expensive versus market capital, the GDP in our lifetime. It's over 100 years and we're just starting to find the realization of what really pumped it up. Massive excessive spending from US governments being shut off. It's just, just this is silly but.
- [32:42]
Dave
That'S why that's not true. That that's the first part of it.
- [32:46]
Mike
I mean what started Tesla, Tesla's part of a Government plan. So let me just point out the valuations I see from a macro standpoint. I think copper has peaked, I think crude oil has peaked, I think corn is peaked, I think natural gas is peaked. I need good reasons for them. Go higher and I see gold continue to appreciate. But if you look at just two, two key facts, gold is the most expensive versus US treasury long bond in our database going back 30 years and same with the stock market. So that's why I keep tilting over to where's the value is. Maybe things like that that I've been wrong on for two years just catches up to the yields in the rest of the world. Made me like China 1.76 a little bit of normalization. That's what I'm worried about is that's the next big trade. And then you might have a chance to dick into, dip into some of these cryptocurrencies that are still I, I see. You know, actually Ethereum was great. It bounced from 2000, maybe it gets a 3000. But to me eventually the range risk is it goes down.
- [33:38]
Dave
So three things there, there are three pieces of information that, that are denoted there. I actually agree with two of them on the edges. It was not the US fiscal dominance that's doing it, it's the printing of money and the denominator. Right, and we always have to talk about the denominator, the amount of dollars in circulation, you know, writ large. But, but let's not work quibble about that. I agree on a lot of what you're saying, but there are a couple of things here. Number one, and most important my thesis, which I have been trumpeting, is that that from Trump's election is that crypto assets that can provide economic value to their holders, or at least have a roadmap for doing that, are the ones that are going to attract growth and the ones that don't are going to become pets.com I, I it is that simple. In the Internet bubble we saw this and for people who don't understand the, the amount of excesses was insane. You're talking about companies that didn't, that, you know, Swan Valley snowmobiles being going to Net Taxi being worth hundreds of millions of dollars, you know, from hundreds of thousands of dollars instantly. And we saw this and, and a lot of things happen. The other thing that happened is people learned how crazily stupid they were for dumping companies that actually did have a path to profitability and they allowed the Amazon, you know, holders of the world or people to buy in at the bottom they sold that. I can't tell you how many people I know that said I can't believe I sold my Amazon down 90% or down 50% or down 80% when it then went up by a thousand percent, 10,000%. Afterwards, people learn they don't fight the let the same where they fight the last war. People understand. And so, you know, we keep waiting for crypto to go down. My theory is the reason crypto insanity. I mean when I look at coin market cap, I'm not different than Mike. I see, you know, whatever, let's, let's, let's pick, you know, stuff that makes no sense to me. I see. And I'm gonna rile people up. I see bitcoin cash at $6.7 billion. I don't know if there's ever going to be a utility for bitcoin cash. Right. I, I see, you know, I see things like let's go through. Where are we? Where's the various. They have to go down pretty far to start finding non. You got billions of dollars in meme. I gotta, you gotta go on memes for a second because it's hard to find them now. So Shiba INU is still $8 billion. Unless they could resurrect Shabarium and actually do something, I don't see why that's worth $8, much less $8 billion in the end. So I, I know that I'm offending people. I, I don't really care. I mean, you know, people want to yell at me about their project, that's fine. But you look through these things. If Pepe doesn't turn into a media franchise and with the ability for the token holders to get access to it, it will be zero. And that's the thing about, about memes. They'll go up, they'll go down, but eventually the music stops because they're, they're fads talks about it. I, I agree with that. And when you look through crypto, we know that of the hundred or so layer ones that are on that list that probably a handful will have value now. And we don't know because if you were looking in 2000 and you know, you were thinking Yahoo or Lycos, these are names that people probably you have to go look up or ask Jeeves was going to win the Internet search game. Guess what? The company that won the Internet search game wasn't public yet. You didn't even know about it. I mean smart people knew about it because Google was building. But the fact is we don't Know what these things. And that's kind of your point. That doesn't mean the entirety of the market cap isn't going to be substantially higher than it is today. It means we don't know. Now when you look at bitcoin and so if you believe by the way that Solana is going to be the base layer for financial markets, then it's dramatically undervalued. It's not even close to being fairly valued. But if you believe that it isn't, then it's, it's the utmost obvious short. It's very binary. The only one here which is different is bitcoin. And, and this is something that I said this weekend which is we've said every time most bitcoiners. James believes to the core of his being, just like I do, that bitcoin will reach a price that's parry pursue with the monetary value of gold. We all believe that, we all believe that it will probably go beyond that because for a bunch of different good reasons yet we also use words that well, it can't happen this cycle because it's too early. Right. Am I wrong, James?
- [38:30]
James
No, I mean it's going to take a while, right?
- [38:32]
Dave
It's going to take a while now.
- [38:33]
Scott Melker
But can I point it? So okay, go ahead, finish your thought really quick, David.
- [38:37]
Dave
But the thought is if most of the sovereign states of the world realize that Bitcoin is something that, that could go there, isn't that the kind of self reinforcing thing that could make this cycle much more explosive?
- [38:50]
James
Absolutely. And it's the game theory that we talk about, but that has not occurred. And now when you have noise around strategic reserves and, and what's going to be in there kind of muddies the picture for all of the states and all of the sovereign sovereigns and so what are they going to be? It just be, it puts it all in the same mix, you know, so that's, and that's confusing.
- [39:13]
Scott Melker
Yeah, I don't see, I don't see foreign countries feeling compelled because Trump Truth yesterday to go start acquiring Cardano.
- [39:23]
Dave
It's not about compelled. It really isn't. I mean look, there's not a lot of supply. I, I wish that there was one of the persons who responded to one of my, my posts the other day. I keep wanting to call them tweets, but whatever. One of my posts the other day saying that the vast majority of the selling that we saw over the last, you know, few, you know, last week basically was all coins held under three months. And I don't know if that's true or not true. But what I do know is that if more and more bitcoin is being invested on, if the, if the driver are long term buyers and that driver manifests, then there is a supply shock coming because people, the same people who are selling then turn into FOMO buyers on the other side. And that's why our cycles are quite as violent as.
- [40:13]
James
So, so let's, let's talk about maybe, let's go to maybe a different perspective on this, okay? One thing we know is that like it or not, Trump, the guy, he, he knows how to make money. You know, he knows how to lose a lot of money too, but he knows how to make money and he knows how to manipulate things. Okay? He knows how to manipulate people.
- [40:31]
Dave
People.
- [40:31]
James
We've seen it in a lot of different ways. Okay? So if you just use that as your baseline, you go to first principles and we talk about game theory all the time. Like, how does this actually happen? How does the United States actually go out there and buy bitcoin without sending this thing to a half a million dollars of coin overnight? How does that happen? Like, because the moment they announce they're going to be buying bitcoin, every single country, every single small country, every single country has their own fiat is going to, they, the game theory says they have to follow suit, they have to go along. Which means that, that this, this could be just like you're saying, Scott, explosive. So what if, and I'm not saying that I think this is what is happening. I'm just putting this out there as maybe an alternate theory. What if he's throwing all these other coins in there to muddy the picture so they can go out there and be buying bitcoin without sending it to a million dollars per coin and have everybody focused on that one thing?
- [41:26]
Scott Melker
What if buying it from.
- [41:29]
James
Oh, they're buying, we're buying everything when we, meanwhile, they're really focused on buying bitcoin? You know, I'm not saying that's what's happening, but.
- [41:35]
Scott Melker
Yeah, doesn't all this in the context of the story that kind of came and went, which is obviously the sovereign wealth fund of the United States, and we've discussed it here first a bit with Lutnick. Doesn't all of this make a hell of a lot more sense to put into a sovereign wealth fund than to talk about reserves and stockpiles with all of this? Because if there was a sovereign wealth fund that had, you know, 6 trillion and they could just go do these things like how would they even be buying Bitcoin right now?
- [42:01]
James
Exactly. Yeah. Yeah, exactly. So, well, you'd have to fund it. But the, you know, if I'm an arbitrage trader, if I'm, if I'm, if I'm a hedge fund trader, right. Then I have to announce in a filing everything I'm doing before I go and do it. I'm going to announce a whole bunch of stuff off. So you don't know what I'm doing. I may buy one share of, of a stock here and one share of a stock there, but I'm going to announce all kinds of things. So you have no idea, no clue what I'm really doing in the background. That's what I would do. And so it would make sense to me for the US Government to muddy the picture and say, you know what, we're going to buy Nvidia and we're going to buy Apple too. You know.
- [42:39]
Scott Melker
Yeah. I'm going to give a much more simple explanation. I'd like Mike's thoughts on it. My explanation is, as you said before, Trump really knows how to make money and this is still the Wild west and his family is going to make so much money in crypto and he has the power to effectively legally Manchu.
- [42:59]
James
Yeah, yeah.
- [43:00]
Scott Melker
I'm not. Listen, it's my most, it's great for us, but my most cynical view of, is always my main view and then prove me otherwise. Not just a Trump of anyone, of anyone.
- [43:09]
James
Like we can view, in my opinion, right.
- [43:11]
Scott Melker
We can see what World Liberty Financial is doing then we can see the assets that he lists here. I mean, Mike, when we saw. And guys, people are going to defend him. It's fine. It's great. Good for him. He launched Trump and Melania tokens. Right. I mean, it's not like we haven't seen the like gratuitous grift. So, Mike, I mean, isn't that the most likely explanation outside of all the game theory and stuff, is that this is a really good opportunity for the Trump family to get exceptionally wealthy for the next few years.
- [43:38]
Mike
I just love when people point out, you know, going through these issues with Russia and Ukraine right now and point out they have good negotiators. We're talking about. Mr. Trump is the president United States because he's the most clever man on the planet. You want to mess with this guy? I don't. This. His flip on crypto is like I bow in his general direction. Yeah, you. It helped you get elected. The thing is right now, though, I Keep. I'll stick with some of the things we discussed. Is yes, he's trying to make the price go up higher based on a promise he made to get elected. He doesn't really give a damn about cryptos except they helped him get elected. Gets the technology and everything. But the bottom line is we mentioned going Perry pass through with gold. I pointed out when I still stick with that 100,000 is the threshold in bitcoin. I think akin to the NASDAQ at 5025 years ago. To me, that's still the key level for the whole space. And part of that is I remember the things I wrote about months ago is you looked at the, the quick accumulation of ETFs in Bitcoin. It's the same as ETFs and gold on a risk adjusted basis. In fact, it got a little higher. I'm like, okay, that's kind of done. We see the outflows lately. It's done there, I think. Remember, that's done underestimate gold. It's not just, you know, as Dave points out, it's been demonetized and still forever and a lot of central banks accumulated.
- [44:50]
Scott Melker
Go ahead, finish.
- [44:52]
Mike
Yeah, so this is. I'll stick with that theory that we've had a bounce from good support in a tactical market. Thanks. It's great for trading. Let's not underestimate. Let's wait. Be careful with the. Some of the fundamental things. I remember hearing the dot com bubbles and about some other cryptos and the key lessons of Jeff Booth, the bitcoiners of rapidly advancing technology. Our government's going to try pick winners in cryptos. I'm like, good luck. And within four years when he's gone, it's going to be the space is rapidly advancing so much. There'll be so many better examples of Solana or maybe even bitcoin because it's happening so fast. I just look at it as massive access supply, major hubris, a lot of too high prices completely dependent on the stock market going up.
- [45:32]
Scott Melker
Good luck, Mike. What I have to say is, and this is for you and Dave and myself and James, all of us, because I don't know the exact date, but we got to go back. But I think we're all buying each other steak dinners because I'm buying on that one.
- [45:45]
Mike
It's just the fun bitcoin to gold ratio.
- [45:49]
Scott Melker
This is the bitcoin to gold ratio. I believe it was last March or April. So right around here, probably around 30 on that ratio. And then Trump won, obviously it Skyrocketed. But you guys bet, Dave bet, you know, they bitcoin would outperform gold for the next year. You made the other side that bet gold. And I think that even among all this crypto excitement, they're either right around or gold might be slightly up. I just, you know, Mike, you take a lot of shit in the comments over here sometimes because these things take time to play out. But it's important to remember that you're someone who zoomed out and looks at this. And gold has done just as well as bitcoin over a year if you take that time.
- [46:29]
Mike
That's what's happening lately. And I published on that today.
- [46:31]
Dave
We.
- [46:32]
Mike
Okay, the. The bitcoin top is less of an island top versus gold. It's less of an island top than it was on Friday when I wrote my article and sent to editors. But we still have that downward trajectory. And gold ETFs are just taking off four years in a row of outflows. To me, this is the. This is the flip. This is the psychology, psychological flip. And you basically need strong payroll number and the stock market to do fine. Otherwise, it's overdue. Now you're seeing it in housing, you're seeing in sentiment. Maybe it's different this time and seen it in cryptos. Now they've had their little bounce. I'm like, good luck. But that's key thing. Let's remember, I want to point out. Let's get to the macro hole here. I still think bitcoin is more likely to go to 50 than 150. Here's the problem. Going to 150 means most risk assets go up. Inflation, the risk, the wealth effect. The Fed has to tighten. Remember, they stop easing partly because the wealth effect last year in the stock market was the greatest ever. Here's the bent. The tilt is that has to go down. And the Fed's stock, I mean, it's. What's the key things to make the Fed ease? Number one, stock market going down. Number two, unemployment going up.
- [47:34]
James
Yeah, but what if they don't ease and they just come up with all kinds of acronyms to help push liquidity into the market instead?
- [47:40]
Mike
Yeah, they. But okay, that's what's the key thing for that to happen. Number one, Dave said it earlier, Treasuries.
- [47:44]
James
Treasuries have to be in trouble. No.
- [47:46]
Mike
Well, no, we've learned. Oh, yeah. Okay. What's the number one goal of Mr. Bess and Mr. Trump right now is lower yields, lower energy. I've been talking. I heard him talk about the stock market a while. But the key thing to remember is we've learned the lessons of too much liquidity and inflation. That's the key thing that's different from any single time we punt liquidity in the past. Most notably the biggest pump in history, which was 2020 and 2021. If we haven't learned that lesson, God, it's our fault.
- [48:11]
James
But Mike, I think, I think we have learned a lesson, but we don't care. I think, I think they have learned the lesson, but they just don't care.
- [48:21]
Mike
I'm just pointing out the. Okay, let's get put back to that 200 day moving average in S P500 and see what happens. Maybe.
- [48:27]
Scott Melker
What is that level, by the way? I haven't even checked.
- [48:31]
James
Mike, to be clear, I'm not arguing with you about the lessons. I talk about it all the time because it's awful. It's, it is the, the predatory nature of the central banks on, on the lower demographics is abysmal. It's, it's an, it's an awful truth. But that doesn't mean that they're going to change the way that they do business. They're going to continue to do what they do because the, the reward system is set up that way. They're rewarded for it. They're not. Who, who wants to crash the economy, tighten liquidity and suffer the, you know, the consequence of being blamed for sending the entire global economy into turmoil. Who wants to do that? Nobody wants to do that. The incentives are not there. That's the problem. The incentives are not aligned with the reality of what we need to stop this continual demographic diversion where you've got rich, the wealthiest who own assets are going to continue to get wealthy. That's just the reality of the system we have set up up, which is why.
- [49:39]
Mike
Yeah, so that's a key point. I'm with you on that. The key point I'm making is when we get just the normalization of the very expensive risk assets in this country, most led by cryptos, the most in history. When we get that, that's when the Fed starts seizing and they're going to fight that battle. It might still last a long time. It might start Friday with a bad employment number and unemployment ticking up. But also what's, what's the doge doing right now? It's shutting down. That massive fiscal SFS was spending in waste that was way overdue.
- [50:07]
James
And I think this is going to be contraption.
- [50:09]
Scott Melker
Right? I mean you do his austerity of a Different design, but.
- [50:13]
James
Yeah, yeah. But the question is, are we going to have a slow grind lower because of poor economic news and stagflation, or are we going to have a shock to the system? That's the question. And how quick are they going to react? That's it. How quick are they, how quick are they going to turn off the, you know, the, the minimal QT they're doing, which is $25 billion a month? It's nothing. Just letting Treasuries roll off the books. I mean, when are we going to, when are we going to have, you know, a new debt ceiling? So. And how much is Doge really saving us in the long run? And how much of the. Is the government going to turn around and spend in the background in order to make sure that we continue this charade? That's the question. Is it going to be the central bank steps in and prints money? Are they going to have an acronym because of some sort of financial shock like we saw with when, when we had Silicon Valley bank crash and, and implode? Are we gonna. So what is, what is the impetus for them to step in? Is this slow grind lower? If it's slow grind lower than. I agree with you, Mike, then they'll just start easing and then everything kind of. And we'll have that kind of hardish landing. But. Or is it going to be something that tips it off and we have a problem that points to a, A, an issue with the Treasuries, which would be Silicon Valley bank. What's that, Scott?
- [51:32]
Scott Melker
Slow grind lower would be problematic for the midterms. They can't have that. They, they can't, they can't have the stock market just kind of slowly drop for 18 months. And so it's got to be a. As you said, it's got to be a band aid, Rip. We got to get it over with so that in 12 months nobody remembered.
- [51:48]
James
It happened and blame it on the last administration because, well, it's obviously, you know, it wasn't something I did, but. Yeah.
- [51:54]
Mike
Doge is band aiding, Rip. Right. Ripping right now. I, I was kind of hoping they would do this. I'm shocked. They actually did it the way a true good corporation would do. Like my father did in the 80s when he helped save a steel company in Chicago. You got to hit, rip the band off right away. And they're doing it.
- [52:11]
James
Yeah. And now we're seeing that the GDP was revised not just lower, but to negative. Right. It was, it was Revised down to minus 1.5.
- [52:19]
Scott Melker
That's crazy Atlanta. That was the Atlanta Fed.
- [52:22]
James
Correct, Correct. So I mean this, there's so much uncertainty which is incredible that the market is still holding in here with all this uncertainty gradually then suddenly.
- [52:36]
Dave
Yeah, I mean look, I just keep coming back to a very simple question which is when you're investing in and let's, let's ignore the, you know, xrp. We'll talk about that. You know probably on Crypto Town hall. I'm sure Mickle will talk about it. And let's not talk about Solana because Solana has a huge supply thing which is how much of the, of the recently unlocked Solana is going to actually end up on the market right now I would imagine.
- [53:00]
Scott Melker
Doesn't worry me.
- [53:01]
Dave
Yeah, I'm not, not worried in the long run. It's a question. If Solana continues its ecosystem to be come the, you know, markets, you know, underpinnings then it's going to be worth a lot more. But bitcoin, the fact that most of the people who are long term investors in bitcoin believe it is undervalued by 90% is very different. I don't think there is a human being on the planet that could look themselves in the mirror without laughing and say that they're buying the NASDAQ at what they think is a 90 discount to fair value in today's dollars. Nobody. That is a massive difference. So look, Dick, bitcoin is trading on technicals. Last week we saw a breakdown. We saw so and I'm very curious to see what Peter, things Bitcoin just dropped below, you know, drops just dropped below 90 000. It looks like, you know, we're in a reassert the technicals from last week. As long as, as long as technical traders are in command and there's no supply, there's no demand coming through and follow through, then we're going to be very choppy for a while. And that, that's, you know, that's fine. I mean you know I basically said that you know, 80, that that 80000 low was a tradable bottom. I still think it's a tradable bottom. I, that doesn't mean, I think we're going straight up to 150, 180 or whatever. I think, I think that you know, this stuff needs to play itself out. But understand fundamentally the people who own most of bitcoin and the ones who are accumulating and think it is over 90 undervalued, that is different.
- [54:36]
Mike
I gotta laugh at that statement because if you own something, of course you think it's undervalued. Duh. Come on.
- [54:41]
Dave
But no, Mike, it is. I have never bought, I've only bought one stock in my entire life that I had an in. I had a mental price target of 10x its value and guess what? It 10x'd. And the re it. It had something to do with if a particular law changed, this company will be worth something. And I had people telling me this law is going to change. It was an, it was Italian law. And so I had friends that, that had good ends in the Italian government. It was one stock that I knew about that made money and it was 40 years ago probably today that would be called insider trading. But back then no one really knew anything. But you know, other than that, I think buying bitcoin now at under a hundred thousand is the moral equivalent of insider trading. Knowing what we, what we know about where values and trends are. I, I would not say that about any other asset I have. It's a much higher conviction. And people ask me about this all the time. Time that dynamic changes what you're saying, you may not like it that way, but it is, it is something different. And I don't think that there's any danger of a new technology coming involved to take over Bitcoin. Either there will be a decentralized digital asset that will be a global store of value or there won't the notion that something new is going to come along because it's quote, better tech. It's not about tech, it's about critical mass. It's about network effects. It's about a network that is hardened and hasn't gone down in 15 years. It's about a hash rate and a network strength that continues to go up. It's not the same thing. And so yeah, I sound like a bitcoin maxi when I talk about that as a store of value. But you need that backdrop now. Does that mean that things that technical trading won't dominate? Of course it will dominate on the margin liquidity rules. It always has, it always will. But that's why God candles can happen. People are calling what happened yesterday as a God candle. I actually was laughing at that. So other people said it was a short squeeze. I was laughing at that. No, what it was was the momentum trader saying oops, I was caught flat footed and it went the other direction. What we need to find out is where is the actual bid right now and can they actually get supply at that level? If the answer is yes, it's going to Stay around those levels or scale back in. If the answer is no, then it's going to start going higher. We don't know the answer to that. And I said that very clearly. I still think that's true. I didn't say 90 was a tradable bottom. I said 80 was a tradable bottom. And that may very well. And it's tradable. Right. We're talking about the long run.
- [57:10]
Scott Melker
At the end of the day Bitcoin slammed right into resistance at 95,000 and dropped. If you looked at the Salana chart it slammed right into resistance at like 180 and now dropped. So yeah, I mean it was a huge move but still within sort of this technical range. Nothing notable happened for price that would give you the idea that you're going straight to all time highs again. But there's, there's a. So. Oh my God, I can't believe it's 10 o'clock. There were so many things I wanted to discuss. I just do want to highlight one of them that I think is important which is that BlackRock adds its Bitcoin ETF to model portfolio for first time. I do. I like I couldn't. It just kind of got lost in the news of all this. James, you gave this. Maybe you could just kind of. To me this is like massively important just as a step. It's not like something that's going to send price.
- [57:53]
James
Yeah, really. Really. I wrote about it in, in actually a full newsletter this weekend. So anybody who's watching it, it's. It was a free newsletter this weekend on the, on my informationist. But there's difference between. People have been saying oh BlackRock's the one who's buying Bitcoin. Blackros the BlackRock buying Bitcoin for the ETF is buying Bitcoin for the people who are buying the etf. They're not buying it for themselves. That's just that. That's really big distinction to be made here. This is different. This is BlackRock putting it in their model portfolios. For all the IRA RIAs and portfolio managers who, who use BlackRock's templates to add to their model portfolios. These model portfolios have about $150 billion in them which means that they're. Anybody who's watching these model portfolios. If the model portfolio has alternative assets in it then they're saying you should have a 1 to 3% allocation in it it. And that could be, you know, so or 1 to 2% allocation. So that could be as much as $3 billion of buying pressure for Bitcoin ETFs and especially the IBIT because I bits the one they put in their own portfolios. Obviously it's their, it's their etf and so it's just a little bit different this time. It actually is BlackRock saying to buy it but it still isn't really BlackRock buying it. It's the, it's the managers who follow those portfolios. So but yeah it's interesting and it, and it is it. This is real, this is actually for people saying, you know, BlackRock's the ones buying your, your, your bitcoin when you, when you sell your ETF. That's not really what, what's going on or BlackRock's out there buying the, the bitcoin this time it's kind of true. So that's a distinction and it's a big deal. It's a really big deal.
- [59:40]
Scott Melker
Yeah.
- [59:40]
Mike
Good one takeaway we have, we still have a pretty significant strong stock market this year. Total return S&P 500 is up 1% but TLT's up 6%. Bitcoin's down 4%, gold's upset 10. I think those are trends just getting started partly because yes, I've been wrong for two years on bonds. Lost my hair talking about buying bonds. I think that's going to be one of the best performing assets this year. Good old tlt, but they're still not.
- [60:05]
Scott Melker
Even down in that time. They just didn't perform exactly when you get that interesting because I've been holding TLT since 84 when it was the bottom. And I, I mean I did that even publicly here we talked about, I'm still up, I haven't even thought about it, you know.
- [60:17]
Mike
Yeah, that's the key thing. At some point we're just due for it at normal, you know, 20 backup in stock market. We don't make a record high for five years. God help us, you know, stuff that used to happen and this market is so due for just it's normalization, mean reversion. Bitcoin's just one of the best leading indicators there is and people always justify different reasons for it to go up. I think it's peaked at a hundred thousand. It's more like go to 50. It's not a big deal in the history of bitcoin.
- [60:43]
Scott Melker
And the last story that I just need to highlight quickly is that there's going to be a crypto roundtable at the White House on Friday. So for anybody who didn't think that we had enough insanity for crypto news from the White House. You got that? Yeah. I guess we'll have to move it to crypto Town hall. Dave, you're dying to say something, so go ahead.
- [60:59]
Dave
No, no, look, I could see it. I'll save it. I'll save it for next week. Let's let this week play out and see all the foolishness.
- [61:09]
Scott Melker
Yeah. What a week. It's so funny that the market opens and we. And we drop. Yeah, here we go. For very exciting stuff.
- [61:16]
James
I hope everybody's already strapped in.
- [61:19]
Scott Melker
Yeah, seriously. I hope you at least own some bitcoin already. Come on. Anyways, guys, that's all we got for you. We will be back, of course, next Monday. I'll be back tomorrow with Andrew and Tillman and the Arch Public crew and heading over to x spaces in 10 minutes. Thank you, gentlemen. Always a pleasure. I think I'm still buying the stakes, to be honest. We just got to get us all in Miami at the same time. Maybe we should do a macro Monday dinner and invite our fans. That'd be.
- [61:42]
James
That would be fun.
- [61:43]
Mike
Let's see.
- [61:45]
Scott Melker
I'm gonna talk about that. I say these things that I forget about them because I made it. Good idea.
- [61:49]
James
All right. They won't let you forget about in the comments.
- [61:52]
Scott Melker
Scott, that'd be awesome. Comment if you want to come. See you in Miami. Bye, guys.
- [61:57]
Dave
That's dope.