0:26

you you

1:07

Happy Friday, everybody. Welcome

1:09

back to Swan Signal Live. Stephen,

1:12

have you been walking I know you walk every

1:14

day Where are you at right now what's your

1:16

count i'm only i'm only at like around 12k

1:18

right now it's a slow day nothing too nothing

1:20

too impressive what about you guys i got you

1:22

i got you right now we have to check

1:24

back in on the at the end of the

1:26

day But I'm actually 15k. i I

1:28

had a walk this morning with the dog

1:31

Yeah, let's go That's like seven or

1:33

eight miles Yeah. yeah I'm going have

1:35

to go on another walk though I

1:37

suspect to beat you you You got

1:39

to keep up over the last like

1:41

month, my average has, I like never,

1:44

i've never done this before in my

1:46

life but i've been hitting like 30 ,000

1:48

a day i don't really know what

1:50

happened i've had some blisters i've had

1:52

some fetish so probably not either adapting

1:54

or not super sustainable long term, but

1:56

we've been going When I went wild

1:58

last year going from five, six, 7

2:00

,000 steps a day to 20, 25 ,000.

2:03

Yeah. Got. an injury on my foot

2:05

that my metatarsals got messed up. So I

2:07

had to take six weeks off. I remember

2:09

feeling good now. Power is bad. Yeah.

2:12

All right. So we've got John Har, who you

2:14

all know very well. Of course,

2:16

Steven. And we've got Jason Bassett, who

2:18

is a rep at Swan Private as well

2:20

to join us and give his takes today. We

2:23

will just kick it off with, as we

2:25

usually do with John, talking about macro

2:27

and markets and just kicking off this conversation.

2:29

John, what have you seen this

2:31

week in markets? What's what's big

2:33

news? Yeah, for sure. So

2:35

I think the first thing to

2:38

mention is just that this week has

2:40

felt relatively stable, not too volatile. Of

2:42

course, that's all relative. We had a

2:44

bunch of really volatile weeks before this

2:47

one. But I think that alone

2:49

is noteworthy, but it's not

2:51

every single week that we're going

2:53

to have S &P up 5%, down

2:55

5%, Bitcoin 85, 75. Not

2:57

every week is going to be like that. even

3:00

though we haven't really gotten any

3:02

significant sort of resolution on

3:04

what started this volatility in the

3:06

first place. Just to give

3:08

like super big picture for anyone who's been

3:10

living under a rock for the last few months,

3:13

the Trump administration is looking to reform

3:15

the global trading system, even the monetary

3:17

system to a certain extent, in

3:19

the biggest way in definitely my

3:21

lifetime, you could maybe say in

3:23

50 years. I think...

3:27

I think it's undeniable that the

3:29

US has a good motivation for

3:31

doing that. If you guys want

3:33

to hear a conversation of someone laying

3:35

it out very clearly and very articulately,

3:37

check out Lynn Alden talking with Natalie

3:39

Brunel. The conversation just was posted

3:42

yesterday. I think Lynn did a

3:44

phenomenal job. I think to

3:46

the point where it's undeniable that

3:48

the US has to change something

3:50

about this system. because the social

3:52

problems, the economic problems, the national security

3:54

problems are just too glaring, they're too

3:56

big. Now, that

3:59

doesn't mean everything, that there's no debate, that

4:01

there's no questions to be asked. I think

4:03

there's still huge questions to be asked,

4:05

which are the policies the administration is looking

4:07

to employ? Are those the right policies? How

4:10

long will it take for those

4:12

policies to actually set in and

4:14

create good outcomes? Will

4:16

there be negative knock -on side

4:18

effects? And what other hurdles

4:20

will they run into that might prevent

4:22

them from following through with these

4:25

policies? There's tremendous debate on all those

4:27

questions I just listed off. So

4:29

that's what we're in the middle of

4:31

right now. And I think until

4:33

we get more clarity on those questions,

4:35

you're going to see markets stagnate

4:37

to a certain extent. It's going

4:39

to be hard to see some sort of

4:41

massive rally while all of those questions are out

4:44

in the open. And then just

4:46

to put a bow on this, I'll say

4:48

the things that I think are really

4:50

difficult for them, the hurdles that they'll run

4:52

into, some of them they already have

4:54

run into. Number one is

4:56

that it's a really tough message to

4:58

sell to the public to say,

5:00

hey, we're changing the global trading system

5:02

and the monetary system. It's for

5:04

your benefit, I promise. But

5:06

it's going to take years, more

5:08

than months to see the benefits and

5:10

your stocks are down. your 401k

5:12

is down, your brokerage accounts down, your

5:14

pensions down. Yes, I know

5:17

people love to quote how many people in the

5:19

country don't own stocks. It's a

5:21

big number, but it's like

5:23

around 50%, 40%. So the other

5:25

part, they do own stocks. And

5:27

this is anecdotal, but I'd be curious

5:29

to know what your guy's experience was here. During

5:32

the recent vol, I had the

5:34

equity market vol. I

5:36

had texts from It's friends and

5:38

family who work what would be

5:41

called blue collar jobs like teachers,

5:43

police officers that were like, Hey,

5:45

what the hell is going on? As

5:47

in the markets down massively, they don't

5:49

have millions of dollars in a brokerage

5:51

account, but they know they have a

5:54

pension and they're just pulling up their

5:56

phone and they have no idea what

5:58

the reserve currency means. They have no

6:00

idea what triffin's dilemma means. None of

6:02

that registers with them. They're just seeing.

6:04

media coverage of an imploding stock market,

6:06

imploding economy, and they know their pensions

6:08

down. They know their 401k is down.

6:11

It's really hard to sell that message

6:13

to all those people. Hey, I

6:15

promise we're undoing 50 years of bad

6:17

policies, and this is the price

6:19

to pay. Besson has said it

6:22

with his whole, we're focused on Main

6:24

Street instead of Wall Street. I just

6:26

question how long you can do that

6:28

and how much market pain you can

6:30

tolerate. And I think We

6:32

already saw some of this another obstacle

6:34

they're gonna face is that the US

6:36

has this massive debt burden and It

6:38

was definitely not their plan to announce

6:40

these tariffs on Liberation Day, and then

6:42

what was it like seven or eight

6:45

days later? They're already saying okay back

6:47

to universal 10 % tariff we're focused

6:49

China right now Yep, maybe that was

6:51

on the drawing board somewhere, but it

6:53

wasn't like hey guys We're playing through

6:55

this seven days later. I agree hand

6:57

got forced by massive down days in

6:59

equity markets and by treasury yields rising

7:01

Remember that Besin said the 10 year

7:04

is one of their markers of success

7:06

You can't have liberation day happen have

7:08

the 10 year go up and then

7:10

say this is all going great But

7:12

that should be obvious. So again, I'm

7:14

extremely sympathetic to the administration and why

7:16

they're looking to do what they want

7:18

to their motivations I just think there's

7:20

some really big hurdles. They're gonna run

7:23

into and The biggest thing to be

7:25

on the lookout for in the coming

7:27

months is what deals look like with Japan

7:29

with Germany with different economic zones and

7:31

regions what they look like from a

7:34

trade agreement what they look like from

7:36

a currency agreement perspective I think that's

7:38

going to dictate where markets go over

7:40

the coming years So I'll stop droning

7:42

on but here's what you guys have

7:44

to say about all that particularly do

7:46

agree with what I said that even

7:49

the quote -unquote average person who doesn't

7:51

have a lot in their brokerage account

7:53

or pension Do you think they're spooked

7:55

by? the market vol of the last

7:57

month, or do I just have a

7:59

few anecdotes that are not reflective? So,

8:02

a lot of great stuff there. The

8:04

one thing I want to, like, just

8:06

circle in on first, you're saying, like,

8:08

the average person doesn't understand Trippin's dilemma.

8:10

So, are you saying the solution is

8:12

40 hours of Bitcoin podcasts per week?

8:16

Here, I'm here. only person who

8:18

needs to watch 40 hours

8:20

of Bitcoin podcasts per week. Stephen's

8:22

gonna write a doctor loop cuz gonna

8:24

write on a prescription pad 40 hours of

8:26

Bitcoin podcast a week This is the

8:28

only way you can be cured. I'm begging.

8:30

I'm trying to get the Bitcoin bugle

8:32

sponsorship But no you had some really great

8:34

stuff there great points I agree with

8:36

I think pretty much everything so I don't

8:39

think the plan was to pivot after

8:41

seven days I think their hand got forced

8:43

by the market. I think they came

8:45

in too hot. I think there was a

8:47

plan to pivot I don't Like the

8:49

plan was always to come in harder and

8:51

roll back. That's classic Trump, but they

8:53

came in too hard and they rolled back

8:55

too quickly. Yes. And I don't think

8:57

that was like 40 chess, right? Yeah. I

8:59

mean, I heard the idea that Lutnik

9:01

and Navarro came up with this idea. Trump

9:04

went with that. It clearly didn't work. And he's,

9:06

okay, Besson, what's going on? Can you handle this,

9:08

please? Totally. That definitely

9:10

appears to be the consensus. By the way,

9:12

I have a lot of commentators that Lutnik and

9:14

Navarro are more like shoot from the hip. And

9:17

then Besson's like the adult in the room.

9:19

Just knowing a little bit about Lutnik. I don't

9:21

know much about Navarro. And a little bit

9:23

about Besson's and their personalities. Yeah, that seems to

9:25

be about right. Shooting from the hip is

9:27

probably a good description. 100 %

9:29

So I agree with all that. I

9:31

agree with the pain. I agree

9:33

with this is like gonna take time.

9:35

I think they don't really have

9:37

the ability to tolerate as much pain

9:39

as would be necessary because this

9:41

is a longer process. I'm not saying

9:43

they can't get like some... and

9:45

wins. I'm not saying they can't get

9:47

some things to move, but it's

9:49

a really hard process. I think the

9:51

one thing I do disagree with

9:53

you on is I don't think the

9:55

average person is feeling this yet

9:57

or really aware of it. I would

9:59

probably take the other side on

10:01

that and just say that I think

10:03

your average person doesn't watch the

10:05

market, doesn't have stocks. I

10:09

don't know the word was it schnottenfreude or

10:11

whatever that Schnottenfreude? Yeah, there's a sense of

10:13

that with the market going down So I

10:16

think he does have a little bit of

10:18

a buffer with the average point real quick

10:20

Stephen I did see a chart and I'll

10:22

have it pulled up But I did see

10:24

a chart on Twitter this week that showed

10:26

the approval ratings on the economy for

10:28

Obama and for Biden and then

10:31

Trump and Trump's is tanking. So they

10:33

are doing surveys and pulling on

10:35

this pulling on this stuff. He's

10:37

up. He's actually up overall. So maybe

10:39

on the economy, he's on the economy

10:41

specifically. I don't doubt that. I don't

10:43

doubt that. But on net, his approval

10:45

rating has climbed. And so that's one

10:47

reason I'm saying I don't think the

10:49

average person is really freaked out about

10:51

this yet. And I think that gives

10:53

him a little bit of a buffer.

10:55

But again, There's a

10:57

really fine line between the stock market

10:59

crash and a recession and they are

11:02

afraid of a recession. They know that

11:04

I know this for a fact. I've

11:06

heard this from people close to the

11:08

administration. That is what they fear. So

11:10

the net result is pretty much the

11:12

same in terms of any thinking about

11:14

or thesis on it. So like I

11:16

said, I pretty much mostly agree with

11:18

you, but the average person is shockingly

11:21

underexposed. True.

11:24

I think the 50 % of assets

11:26

or something even more, I don't

11:28

remember the number specifically, but it's a

11:30

very large percentage of assets are

11:32

owned by the 0 .1%, the 1%,

11:34

the 5%, the 10%, and then there

11:36

are 60 % of Americans who basically

11:39

hold no assets outside of an

11:41

IRA and then 30 or 40 %

11:43

that literally don't even have an IRA

11:45

and no exposure at all to

11:47

equities. I think part of

11:49

it too is that... are just

11:51

so headline driven and people see

11:54

headlines about how the stock market

11:56

is doing and it's a lot

11:58

of doom and gloom. And it's

12:00

really more of a perception thing

12:02

than they're actually financially feeling that

12:04

pain directly. Sure. Like many people

12:07

just equate stock market performance with

12:09

the economy. They're not taking like

12:11

a nuanced view of the S

12:13

&P 500 versus the price of

12:15

consumer goods versus. have a

12:17

job market looks like they're not taking in

12:19

that holistic picture. It's just

12:21

a visceral reaction almost. Agree.

12:25

100%. I think it's headline driven. Yeah.

12:28

With you. I feel like that would end you

12:30

guys are bringing up good points. There's anecdotes

12:32

all over the place. So, you know, all these

12:34

points can be true at the same time.

12:36

And it's a little tough to aggregate. But your

12:38

point, Jason, I feel like that would imply

12:40

that It's tough for any

12:42

administration to keep going with this playbook

12:44

when you get closer to the

12:46

next midterm election Yes, because we know

12:49

how much the middle in the

12:51

US dictates elections and if people are

12:53

just like the swing whatever you

12:55

to call them the middle the swing

12:57

voter the moderate if they're just

12:59

getting this vibe that Things are tough

13:01

because they see a lot of

13:03

headlines in the media that say Trump

13:05

-induced chaos or pick your headline, I

13:07

think that's just something that the

13:09

Trump administration has to deal with here.

13:11

Yes, they're in office for the

13:14

next four years, but if you lose

13:16

Congress a year and a half

13:18

from now, or two years from now,

13:20

you might be way less able

13:22

to execute what you want

13:25

to. Yeah, absolutely agree. So

13:29

the question then is, and it's

13:31

very clear that Trump is pushing

13:34

Powell now, Let's pull this up

13:36

real quick. Yeah. Yeah.

13:39

Trump posted this on TruthSocial. They always,

13:41

of course, get posted then screenshot it

13:43

and posted to other networks. And here

13:45

he says, the Jerome Powell of the

13:47

Fed, who was always too late and

13:49

wrong, issued a report, which was another

13:51

typical complete mess. The USA

13:54

is getting rich on tariffs and it's they're being

13:56

too late should have lowered interest rates already. So

13:58

this is his plan to part

14:00

of the plan, I think is. Yes,

14:02

they know there's going to be

14:04

short term, I think he called

14:06

it difficulties or something like that. Trump

14:08

called it because of the tariffs. And

14:10

I think the plan then was let's

14:12

counter that short term pain with pressuring

14:14

the Fed to start easing and have

14:16

that kind of accommodates or ameliorates that

14:19

short term pain and then get the

14:21

long term, medium and long term benefits

14:23

of the tariffs. It seems a pretty

14:25

clear plan to me and he's going

14:27

after, this is not the first tweet

14:29

that he's made yet. So I have

14:31

a lot of thoughts on this. So

14:33

let me just start before I get

14:35

into this. I don't think Trump should

14:37

be allowed to fire the head of

14:39

the central bank. That's how I'm coming

14:41

from. So let me start with that.

14:43

That being said, Powell is always late

14:45

and wrong. Like

14:47

you haven't hung around Bitcoin world for

14:49

long enough if you don't find that

14:51

to be like, go look at the

14:53

Fed decisions of the last 10 years.

14:55

I'm sorry, that's correct. Second,

14:57

I'm a little sympathetic

14:59

because Again, I don't think

15:01

he should be able to fire the head of

15:03

the central bank. I think there are issues with

15:05

that. At the same time, we

15:08

are currently engaged in a battle

15:10

versus China who is able to

15:12

wield their central bank as they

15:15

see fit to support their trade

15:17

war objectives. And there's a very

15:19

real way that we are at

15:21

a disadvantage because our central bank

15:23

is acting against the administration. Now,

15:26

should they be like... just a

15:28

way, like the way I'm

15:30

saying this is not saying they

15:32

should just cave to Trump,

15:34

but we are at a heavy

15:36

disadvantage because they're not going

15:38

with it. And there's a line

15:40

where if that's what is

15:42

happening in America, you do have

15:44

a point where you need

15:46

to ask if you're gonna support

15:48

what's going on or act

15:50

against it. It's challenging. And

15:52

you could, the Fed could reduce

15:54

a lot of this pain by

15:56

lowering rates. Now, would that

15:58

empower Trump to continue with a trade war

16:01

that's maybe a little too aggressive and

16:03

has some problems? Yeah, and so maybe that's

16:05

a reason not to. But

16:07

some of this pain could really

16:09

be avoided, as well as the

16:11

fact that I find their excuses

16:13

about inflation to be like horrifically

16:15

misguided. And you can see this

16:17

looking even just at the European

16:20

Central Bank. So the European Central

16:22

Bank has cut rates for the

16:24

seventh time in a row, and

16:26

they are calling tariffs basically a

16:28

deflationary demand driven shock. Because what's

16:30

going to actually happen is people

16:32

are going to buy less of

16:34

these things because they're more expensive. Yes,

16:37

there will be this like

16:39

nominal price increase once, but that's

16:41

not inflation. That is literally

16:43

not what inflation is. And actually,

16:45

there's going to be a

16:47

drop off. And so what the

16:49

European Central Bank is actually

16:51

concerned about It is deflation in

16:54

a certain regard or a

16:56

deflationary shock and the Fed like

16:58

inflation is low right now.

17:00

Growth is slowing. Whatever you

17:02

want to feel about all the politics, I

17:04

don't really give a shit. The

17:06

issue is you need to cut now.

17:08

Like you should cut now. We're not. It's

17:10

not going to spiral. At least 50

17:12

basis points of cuts is not going to

17:14

put us into a second wave of

17:16

inflation. I'm sorry. No. Also, tariffs are not

17:18

going to put us into a second

17:20

wave of inflation. It will be

17:22

a one -time adjustment. And once

17:24

those prices go up, there will be

17:26

real shifts in buying power. And this

17:29

is something people talked about prior to

17:31

any of these tariffs. That

17:33

as long as you don't create

17:35

more money, if prices increase across

17:37

the board, all you have is

17:39

the same amount of money that

17:41

can shift around where they're going

17:43

to buy. You literally can't have

17:45

net inflation. because it's the same

17:47

amount of money shifting around. If

17:49

you're buying more over here, you're

17:51

buying less over here. And so

17:53

categories might shift higher, but the

17:56

aggregate measure as a whole structurally

17:58

won't outside of this one -time

18:00

price increase. So I think the

18:02

Fed's full of shit a little

18:04

bit. I think while I'm not a

18:06

big fan of this trade war,

18:08

I think it's over -aggressive. I think

18:10

it really risks certain things about American

18:12

capital markets. I

18:14

have to say, like I think Powell's

18:16

wrong and I think Trump is more

18:18

directionally correct on that the right move

18:20

here would to be to cut rates.

18:25

Steven, do you think part of the

18:27

hesitation to cut rates has anything

18:29

to do with concerns over the bond

18:31

market and demand for our treasuries?

18:33

Do you think that's coming into play

18:35

at all? Or is it more

18:38

of an inflation related concern? I guess

18:40

a misguided inflation related concern, because

18:42

like you pointed out, tariff. price

18:44

increases are not really by definition in

18:46

place. Yeah, it's I'll

18:48

be honest, I really don't know

18:50

why they're taking this trajectory. I think

18:52

the bond market has the opposite

18:54

problem right now, which is that rates

18:57

are going too high too quickly,

18:59

right? Like they need to come down.

19:01

There is a debt problem that

19:03

we're quickly running into. And if the

19:05

Fed emerged as a buyer or

19:07

supportive of the bond market, I think

19:09

it would support it. This concern,

19:11

they have their dual mandate, they have

19:13

unemployment and they have inflation. And...

19:18

I don't know what to fix.

19:20

Like, I'm hesitant. I don't

19:22

lean to this prior that this

19:24

is politics. Trump wants to say it's

19:26

politics and they're fighting, like Powell's

19:28

fighting Trump because of political things. That's

19:30

not my first reaction. Like, a

19:32

little hesitant. It could be true. I'm

19:34

not saying it's not true, but

19:36

that's not my first reaction. But

19:38

I have a hard time understanding

19:40

why they're taking this approach because the

19:42

inflation concern is misguided in my

19:44

view. But again, going back to the

19:46

original comment, they also caused a

19:48

huge wave of inflation during COVID. They

19:50

made the wrong decision then. They

19:53

waited too long to cut. They cut

19:55

too much. Then they waited too

19:57

long to hike. They have a history

19:59

of being behind the curve. And

20:01

so maybe that's just the institution we're

20:03

looking at. Fair

20:07

points. I think it is undeniable to

20:09

say, to point out that they have

20:11

been behind the curve. The whole keeping,

20:13

like Stephen said, keeping rates low for

20:15

too long. Do you remember the dot

20:17

plots that they had that basically said,

20:19

we don't, we as the Fed don't

20:21

expect to raise rates until 2024. That's

20:24

what they said back in 2021. That

20:26

obviously was an incorrect forecast by a

20:28

long shot. And then. Yeah, because they

20:30

said that, and once inflation started to

20:32

show up, they said it would be

20:34

transitory. And for nine months, they're saying

20:36

transitory until they were forced to say,

20:38

okay, I think this no longer meets

20:40

the definition of transitory. So

20:43

I think that is a fair point. Well,

20:45

inflation's gone. It was transitory. It only

20:47

lasted for three years, transitory. Some people actually

20:49

tried to make that argument, which is

20:51

insane to me. There is an increase in

20:53

liquidity in M2. So M2 is turned

20:55

back up. This is from the St. Louis

20:57

Fed. This chart

20:59

here. Actually, not that

21:01

chart. This one here shows a

21:04

chart of liquidity and Bitcoin's price

21:06

charted on top of it, which

21:08

shows correlation, especially a follow by

21:10

Bitcoin's price. You can see that

21:12

giant spike up on the blue

21:14

line for liquidity and Bitcoin hanging

21:16

out there, perhaps to benefit from

21:18

it foreshadowing the next price run.

21:21

And we've also got corporate buying

21:23

at all time highs this past

21:25

quarter, just to the sort stability

21:28

of the market right now. It's delevered.

21:30

This is past. You can see all

21:32

the leverage leading up to the FTX

21:34

gear FTX and Celsius and Luna and

21:36

all of that deleveraged. And we're the

21:38

Bitcoin market is not. This is the

21:40

CFI market. Blending market is not leveraged.

21:42

So that systemic trouble is not present

21:44

in the market right now. Like

21:46

it was. By the way, shout

21:48

out to Ledin, who has been a

21:50

great partner of Swans for many

21:52

years as the third biggest lender. What

21:55

a milestone. Mauricio, great job. Just

21:57

wanted to shout you out. Absolutely. Love,

21:59

Ledin. What's the takeaway

22:01

for you guys on this?

22:03

It's that in the 2021, early

22:05

22 period, people

22:07

were... The idea is that they're

22:09

using these proceeds to then buy

22:11

Bitcoin. It's not that they were

22:13

all taking out a Bitcoin backed

22:15

loan and then remodeling their kitchen,

22:17

because I wouldn't have that big

22:20

of an impact on the Bitcoin.

22:22

it was to buy Bitcoin somewhat,

22:24

but I think they were also

22:26

going after those huge returns in

22:28

the scambling world. Correct. Yeah, that's

22:30

a good point. Yeah. Yeah, I

22:32

think what we're seeing now is

22:34

like a clearing out of that

22:36

Nonsense gambling behavior and now this

22:38

is like a much more healthy

22:40

Market that you're seeing in terms

22:42

of Bitcoin back lending Exactly, and

22:44

this is this is all this

22:47

is the C5 C5 market Largely,

22:49

so it's not in total. So

22:51

it's not just Bitcoin Lynn John

22:53

mentioned was on Natalie Brunel

22:55

show our friend Natalie Brunel and lots

22:57

of great stuff there. Watch the episodes

22:59

an hour long. We pulled out toward

23:01

the end. Lynn's price prediction. If I

23:03

imagine scenario that brings us to very

23:05

high prices this calendar year, it would

23:07

probably be because some massive liquidity a

23:09

lock happened. Let's say the US bond

23:12

market broke. The Fed came in and

23:14

like basically did yield curve controller QE

23:16

that they don't really want to be

23:18

doing or some sort of big treasury

23:20

operation twist sort of thing. It would

23:22

probably take something like that. combined with

23:24

some sort of de -escalation of tariffs. So

23:27

I never really ruled out what Bitcoin is doing. I

23:29

look at a couple of things. One is, I think

23:31

the liquidity is probably to be somewhat favorable first year.

23:34

And two, if you look at certain

23:36

valuation metrics, I like to look at

23:38

the market cap to realize cap ratio,

23:40

which is market capitalization compared to the

23:43

average on -chain cost basis. And

23:45

this current consolidation has taken off a lot

23:47

of the hype around it. you

23:49

look at the prior consolidation, so Bitcoin

23:51

reached 73 ,000 in March 2024, that

23:54

ratio got a little bit elevated. So it

23:56

wasn't elevated to the point of prior multi

23:58

-year tops, but it was a little bit

24:00

heated. And so after about

24:02

a seven -month consolidation, it pretty much worked

24:04

off all of that excessive valuation, that

24:06

excessive hype that allowed the market to

24:08

consolidate. Then when it jumped to 108K,

24:11

it reached similar frothy levels. And

24:13

so the fact that we've been consolidating

24:15

for several months, not particularly surprising, I think

24:17

we worked off a lot of that.

24:19

valuation already. So I think we're at a

24:21

pretty strong foundation to at least start

24:23

building from, especially once we get past maybe

24:25

near term stock market shocks and things

24:27

like that. That's right. Thank you so much

24:29

for that. It's always so great to talk to you, Lynn. I

24:32

really do hope. Yeah,

24:36

again, shout out to Natalie and her show,

24:38

Coin Stories. You should check out that interview with

24:40

Lynn and she has lots of great minds

24:42

all the time. Excellent interviewer. So highly recommend Coin

24:44

Stories. What do you guys make of Lynn's

24:46

take there? I

24:48

liked it. I think that whole episode is worth

24:51

listening to. I shouted it out at the beginning,

24:53

but I'll say it again. Really good job. Natalie

24:55

asked, I think, all the right questions. Lynn

24:57

gave a master class on

24:59

high -level macro stuff. And then

25:01

that question about Bitcoin was at the end

25:03

of the conversation. And yeah,

25:06

I would agree with what Lynn

25:08

said, but I would just add one

25:10

other wild card, if you would

25:12

call it that. Bitcoin has this chance

25:14

that the US government buy is

25:16

a good amount. You cannot forget this,

25:18

right? They have said and put

25:20

it in writing, the Treasury

25:23

Secretary and the Commerce Secretary, Besan

25:25

and Ludnick, will find, should

25:27

find, I forget, shall find something

25:29

like that. Budget neutral ways to

25:31

acquire more Bitcoin. Bo Heinz

25:33

has been out publicly multiple times

25:35

now saying he wants the US

25:37

to buy as much as they

25:39

can. There are different proposals saying,

25:41

hey, US government, here's how you can

25:43

do some budget neutral purchases of

25:45

Bitcoin. So I agree with

25:48

Lynn's point that there could be some sort

25:50

of liquidity unlock that causes Bitcoin to

25:52

rise with liquidity. We know Bitcoin is very

25:54

correlated with global liquidity. 100 % correct. I

25:56

would just add to it that there's

25:58

this other potential that the US government at

26:00

some point says, hey, by the way,

26:02

we found a way to buy a billion

26:04

dollars worth of Bitcoin. Bitcoin

26:06

has that. card that can be played.

26:08

Nvidia stock does not have that

26:10

card. The

26:13

government's not going to buy a bunch of Nvidia

26:15

stock. It's not

26:17

Japan. I'm dumping my bags. Trump

26:20

Trump just said yesterday he has good friends

26:22

with Jensen and Jensen is going to be just

26:24

fine. He said he's going to be just

26:27

fine. So who knows what they're going to do.

26:29

They blocked him off 5 .5 billion. Maybe

26:31

they're gonna they're gonna buy some stock or

26:33

I honestly think they should buy all the chips

26:36

that they can't sell to China I honestly

26:38

think that's the next move Sorry, I'm going to

26:40

answer the question as this is a side

26:42

thing. But so this week, Trump blocks Nvidia from

26:44

exporting any of these chips to China, like

26:46

$5 .5 billion chips. And this is a huge

26:48

piece of leverage because of how fast AI is

26:50

going right now. You need these chips. And

26:53

my thing is the government should just make

26:55

up the purchase, just literally buy all the

26:57

chips, give them to American companies. Like you

26:59

want this competition, like support the AI race.

27:01

If you're going to play this like top

27:03

down game of controlling trade, Like at least

27:06

do it in your favor. You can say

27:08

free markets and you can say, let's just

27:10

have free and open markets. But if you're

27:12

not going to have those and you're going

27:14

to play this game, you might as well

27:16

play it well. So anyways, tangent. But

27:18

I agree with Lynn. I think there's a lot

27:20

of, one thing I actually took away that I

27:22

think she didn't stay with on that point, but

27:25

it was the most important comment to me. She

27:27

said, liquidity is going to be pretty supportive for

27:29

the rest of the year. And that's what I

27:31

think people are missing is that, yeah, we're in

27:33

this trade war. And yeah, there's all these tensions

27:35

and difficulties and what have you. But

27:37

liquidity is going to have to come

27:39

this year. And so that

27:41

will be supportive. I'm also still, I think

27:43

they do end up resolving this thing.

27:46

I think in two months, we're not still

27:48

in these conditions. But I think between

27:50

liquidity environments changing, and I do think you

27:52

see big buyers. I think you see

27:54

a lot more corporate buyers. I think these

27:56

MicroStrategy -esque plays are hot. They're big. They're

27:58

continuing. There's going to be more. And

28:00

I think you see US government activity, I

28:02

agree with John. They've been very transparent,

28:05

and I think it could be at a

28:07

big scale. I'm very bullish. And I

28:09

was on Twitter. I shouted out the Sunday's

28:11

Future Open, which was even below the

28:13

low. I called that as the bottom publicly

28:15

and said everyone was very panicked there.

28:17

And I still think that's true. The bottom,

28:19

in my opinion, is in, has been

28:21

in, and we're not going below there. So

28:24

I think it is still a lot

28:26

of fear in markets, but I think when

28:28

the year is substantially higher. All

28:33

right, so we jump into Bitbons guys

28:35

or anything else on the on markets. Just

28:37

one more comment from me. It's related

28:40

to everything we're talking about here There's a

28:42

very good comment in the chat it

28:44

basically it asks us what we make of

28:46

a statement that G20 countries are selling

28:48

treasuries as a tariff defense Negotiating tactic and

28:50

is this gonna cause the Fed to

28:52

step in and then they pose the question

28:54

the question is how much will the

28:57

Fed be willing to buy this I

28:59

think this actually aligns with what

29:01

Lynn was saying is that there might

29:03

be some event that causes a

29:05

liquidity unlock. And I would

29:07

compare it to a March 2023 event

29:09

when the US was literally entering a

29:11

banking crisis. We had the biggest bank

29:14

failure since 2008 because rates rose so

29:16

much and the banks were caught off

29:18

sides in this unrealized loss position. Then

29:20

you had a bank run that needed

29:22

the BTFP program, the Fed and the

29:24

Treasury and the FDIC came up with

29:26

a new program on a Sunday emergency. caused

29:29

the Fed's balance sheet to increase. I

29:31

think that those are the types

29:33

of interventions. If we see an intervention,

29:35

that's what it'll be by the

29:37

Fed this year. It's not

29:39

going to be below the doors

29:41

open, QE, COVID style. It

29:44

takes something really crazy to justify

29:46

that happening. But I would

29:48

just point out that if you look at

29:50

a chart of the S &P 500 since March

29:52

of 2023, It's like there's

29:54

a couple downs, but it's like

29:56

almost a one -way path up from

29:58

there. So sometimes you just

30:00

need the Fed to plug this hole of

30:02

something that would have been a crisis

30:04

and then liquidity starts flowing for a variety

30:07

of different reasons. But that's the kind

30:09

of thing I would be on the lookout

30:11

for. So I just wanted to hit

30:13

on that question that one of our astute

30:15

listeners pose. Yeah. Very good

30:17

question. Thanks, Karen. All

30:21

right, let's jump into Bitbons. Bitbons.

30:23

Bitbons. It's been a lot of talk

30:26

about Bitbons the past couple of

30:28

weeks. Our friend Pierre Rochard, the

30:30

coin OG and legend, founded Satoshi

30:32

Nakamoto Institute when he was in

30:34

college. CO2 expert, Pierre

30:36

Rochard. All post CO2 expert. Yeah,

30:39

ratioed the New York Times with

30:41

his little CO2 meter monitor. Yeah,

30:44

absolute legend. He has started

30:46

a company called the Bitcoin Bond Company.

30:48

I think it's just called the

30:50

Bitcoin Bond Company. And yeah,

30:52

so this is the thing

30:54

the Let's just get let's just

30:56

get into what it is

30:58

actually the details here Okay, so

31:00

this is from Van Ek

31:02

and Van Ek is getting into

31:04

this idea just to clarify

31:07

this is not Pierce company This

31:09

is not Pierce company Van

31:11

Ek published this actually no I

31:13

was just shouting up here

31:15

there as an example that this

31:17

is this idea is growing

31:19

amongst investors and entrepreneurs Yeah, these

31:21

are digital bonds. They're directly

31:23

on the Bitcoin blockchain And they

31:25

combine traditional bond markets with

31:27

bitcoins, decentralization, transparency. It's programmable using

31:30

DLCs, discrete log contracts,

31:32

obviously global accessibility. So all the benefits

31:34

of the global 24 -7 asset, the

31:37

liquidity of Bitcoin, et cetera, this

31:40

could be used by corporations.

31:42

Corporates could issue these without the

31:44

need for banks or middlemen.

31:46

Retail investors can participate as well,

31:48

which, and this is usually

31:50

the domain of large institutions. So

31:53

that's pretty interesting as well. So you

31:55

can see the governments also, beyond just

31:57

corporations, could be interested in this. And

31:59

this is one of the main points

32:01

here is people have been talking about

32:03

the United States issuing Bitbonds as a

32:05

way to control debt and get exposure

32:07

into Bitcoin as well. So how do

32:09

they work? So

32:11

the basic structure then and this is

32:13

again Van Eck and Justin Beckler wrote

32:15

a great great thread on this So

32:17

I'm gonna shout him out and include

32:20

his commentary here, but the US issues

32:22

a 10 -year bond So it'd be

32:24

like 90 % plus treasuries or 90 %

32:26

treasuries plus 10 % Bitcoin purchased at issuance

32:28

and then investors get full BTC upside

32:30

until hitting a 4 .5 % annualized return

32:32

and after that the gains are split

32:34

50 -50 with the Treasury so that's

32:36

one setup here Pretty interesting stuff. We'd

32:38

love to hear, John, what you have

32:41

to think first, and then we can

32:43

go around. Yeah, for

32:45

sure. So let me start by

32:47

saying I love this idea.

32:49

I love that it's being talked

32:51

about. I love that people

32:53

are putting some intellectual brain power

32:55

into this, outlining it, presentations. I've

32:58

seen it from Brian Estis. I've seen

33:00

it from Andrew Holmes. I've seen

33:02

it from Van Eck is the one we

33:04

just showed. So kudos to them for doing

33:07

it. Okay. Now that I said that, let

33:09

me throw some cold water on it. Basically,

33:11

while I love the idea, I

33:13

just don't think this is happening anytime

33:15

soon. And again, that doesn't mean don't talk

33:17

about it. The conversation has to start

33:19

somewhere. But in particular

33:21

with the government? With

33:23

federal governments. And yeah,

33:25

that's a good clarifying point that I want to get to. It's

33:28

just because if they do this,

33:30

you're signaling to the world Hey, global

33:32

investors, you guys didn't really want

33:34

our debt when it was denominated purely

33:36

in our currency at an interest

33:38

rate that we can afford, right? There's

33:40

always a rate that people want

33:42

your debt. But if there's a natural

33:45

buyer at some very high interest

33:47

rate, that's a problem for all these

33:49

indebted nations. And if they're

33:51

basically saying you guys didn't really want our

33:53

debt under those circumstances, let's throw

33:55

in a Bitcoin kicker and that

33:57

will make you want our debt. It

33:59

just gives the show away. Fiat

34:01

is a confidence game to a certain

34:03

extent. And I'm not saying

34:05

this will never happen. I just think we're

34:07

actually years away from it happening. Because

34:09

what I think governments need to do

34:11

for several years is going to be hold

34:13

the asset and just get comfortable saying,

34:16

hey, part of our assets that we hold

34:18

as a country is Bitcoin. Years

34:20

need to go by for that to happen

34:22

before they start saying, hey, we're going to incorporate

34:24

this into our debt issuance. And

34:26

then just final point I would

34:28

say. I think local governments, state

34:31

and local in the US, for example, have

34:33

a way better chance of doing this because they're

34:35

not the issuer of the currency. They

34:37

can make it more attractive for

34:39

an investor to come in and buy

34:41

that municipal debt against state, city debt

34:44

with a Bitcoin kicker. They don't

34:46

have to worry about the image reputation

34:48

management of the dollar. So that's my

34:50

take on it. I'm happy to be

34:52

proven wrong. If Festin starts issuing Bitbonds

34:54

in nine months, I'll be happy about

34:56

it, but that's not my forecast. So

34:59

I'm definitely with you that I

35:02

don't think it happens anytime soon.

35:04

And like it's a road between

35:06

here and there, though it does

35:08

make sense on principle. The

35:10

one way that I think

35:12

it makes more sense is let's

35:14

say the US government buys. $100

35:17

billion or $500 billion

35:19

of Bitcoin. Suddenly, it's very

35:22

attractive for them because they drive

35:24

up the value of their own strategic

35:26

reserve while doing it. And so

35:28

it's really win -win for the government

35:30

at that point if they're also benefiting

35:32

from the Bitcoin growth. So there's

35:34

a way you could do it that

35:36

I think like paradoxically almost stabilizes

35:38

the currency. I'm really shooting from the

35:40

hip here and haven't thought about

35:42

this, but let's say the US government

35:44

owned a trillion dollars in Bitcoin

35:47

and they issue a bit bond. While

35:49

in some ways they're signaling like

35:51

some sort of weakness in the dollar,

35:53

they're also like capitalizing their own

35:55

balance sheet and their ability to stabilize

35:57

the dollar at the same time.

35:59

So I wonder if I don't have

36:01

any answer. I'm literally shooting from

36:03

the hip here, but I wonder if

36:05

there's something there. Second thought, I

36:08

wonder if it makes sense for corporations to

36:10

do. I think there could be an interesting

36:12

angle for a corporate bond where most of

36:14

it is dollar denominated, but there's a Bitcoin

36:16

kicker. So I think it's stuff to think

36:18

about. But I like that final boss is

36:20

the sovereign currency issuer. Yeah.

36:23

How are these different from sailors bonds? Sailors

36:27

bonds are basically equity. They're convertible

36:29

bonds. So you're basically just bet

36:32

like your return is basically like

36:34

zero or a lot in some

36:36

cases. Like it's a much more

36:38

binary outcome. where this would be

36:40

like your return is 5%, plus

36:42

maybe more, something like that. I'm

36:45

understanding it correctly. I haven't had

36:47

a lot of time on this.

36:49

Yeah, after 4 .5%, the example

36:51

that I just read out was

36:53

4 .5 % return is guaranteed. You

36:55

get all of the upside of

36:58

the Bitcoin up to 4 .5%, and

37:00

then it's split 50 -50, so

37:02

you still do have the potential

37:04

to gain more on top of

37:06

the 4 .5%. And

37:08

Bitcoin's long -term performance has shown us

37:10

anything that's very high potential. I

37:13

think the absolute worst case scenario is

37:15

Bitcoin fails to perform. They only

37:17

get the 1 % or whatever that's

37:19

coming straight off of the debt interest.

37:21

But that's so unlikely if we're

37:23

talking about a 10 -year bond. Yeah.

37:26

And it's also like in a world

37:28

where the US government is issuing these

37:30

at scale, say goodbye to big Bitcoin

37:32

crashes. You know what I mean? Like

37:34

it's a different world. Yeah, for sure.

37:36

And there's one other point I forgot

37:38

to make is that you might argue,

37:40

what if the US kind of gets

37:42

backed into a corner and they have

37:44

to do this or they're just like

37:46

highly incentivized to do it? I would

37:48

just point out that has happened many

37:50

times. That's 2008, that's 2020, that's 2023.

37:53

You know what the button is that they

37:55

push when they're backed into a corner, when

37:57

there's a financial crisis, market of liquidity fed

37:59

by treasuries. That button is not broken

38:01

yet. I don't think they're going to say,

38:03

oh, we can't push this Fed by Treasuries

38:05

button. We have to do Bitbonds. So

38:08

my view is just that we have

38:10

years of, and I think what Steven said

38:12

aligns with what I'm saying is that

38:14

if they start acquiring more and more Bitcoin,

38:17

then Bitbonds becomes more feasible. I

38:19

think that's the order of

38:21

operations. Yeah. Exactly. So

38:23

on that topic, take a

38:25

look at Justin's. He's been

38:27

bearish on the SBR, the

38:29

Strategic Bitcoin Reserve. really from

38:31

the beginning. And he lays

38:34

out a reasonable argument against

38:36

it, as he usually does.

38:38

So he says here, compared to the strategic

38:41

Bitcoin reserve, which is politically stuck and

38:43

relying on congressional whims, this

38:45

model uses market incentives. Bitbond's

38:47

harnessed investor self -interest instead of

38:49

hoping politicians do the right

38:51

thing, they won't. Honestly,

38:54

I think that's a fair take.

38:56

I think that's a good angle, right?

38:58

Like the Bitbonds take market demand

39:00

into account. The government acquires Bitcoin through

39:02

the means of market demand rather

39:04

than through legislation. I think that's my

39:06

takeaway of that post. It's

39:09

more nuanced than that, but

39:11

respect the take. Yeah.

39:14

I like Justin and so this

39:16

is just... good -natured debate in a

39:18

sense. He's been a friend. But

39:20

I feel the opposite of it.

39:22

I think just executive purchases are

39:24

more likely than Bitbonds. I think

39:26

Bitbonds is, I think, more complicated

39:28

in many ways, whereas selling off

39:30

500 million of crypto in the

39:32

crypto reserve to buy 500 million

39:34

of Bitcoin in the Bitcoin reserve

39:36

is easy, whereas rerouting some of

39:38

the tariff income is easy. Whereas

39:41

selling off Fannie and Freddie is

39:43

easy. Whereas like there's just all

39:45

these ways to like do what

39:47

is effectively budget neutral and get

39:49

some amount. And so if I

39:51

was betting on a betting market

39:53

of what do I think happens

39:55

first, some sort of incremental purchase

39:57

via executive authority or Bitbonds, I'm

39:59

going with the purchase. I'd be

40:01

pretty comfortable sizing up on that

40:03

bet. Yeah. And then if you

40:05

want market incentives, like John was

40:07

saying that you can use Bitbonds

40:09

to pump your bags. There's

40:14

one other interesting thing to say

40:16

about this, which is, you guys remember

40:18

how Bitcoiners have talked about investor

40:20

mandates? And we talked about

40:22

how the ETFs opened up

40:24

a lot of pools of capital

40:26

because there's a lot of

40:28

investors out there. First ETFs, but

40:30

then how Sailor, more so

40:32

MicroStrategy, has provided access because entities

40:34

can buy bonds. They

40:37

couldn't buy an ETF. They can hold

40:39

equities. That's fairly easy. And actually

40:41

on this, Brady, you said, how is

40:43

Bitbons different than MicroStrategy? Bitbons

40:45

is even harder because Bitbons

40:47

has the explicit Bitcoin kicker. So

40:49

why am I saying all

40:51

this? Because investor mandates are important.

40:53

Every institutional investor in the

40:55

world can own a treasury. No

40:57

problem. Can they own

40:59

a treasury plus in 10 years

41:02

time you might be getting some

41:04

Bitcoin? Is that spot Bitcoin?

41:06

Now they have to. amend their investor

41:08

policy statement. They have to figure out

41:10

how to own spot Bitcoin. Maybe you

41:12

work something out where you get ETF

41:14

shares. But again, ETF shares is not

41:17

a treasury. You're now telling this institution

41:19

you have this like hybrid security where

41:21

it's part treasury, part Bitcoin in 10

41:23

years. Those investor mandates don't

41:25

change overnight. So even if Bitbond's got

41:27

implemented, my take would be that it

41:29

would be more so like fast money

41:31

hedge funds that would be in first. It's

41:34

not going to be like. mom and

41:36

pops pension plan that's rewriting their investor

41:38

statement yeah i think that's interesting of

41:40

yeah like how do you they also

41:42

could just cash it out i almost

41:44

think that would be what would happen

41:46

is like you get paid out at

41:48

the end of the note and it's

41:50

like they sell the bitcoin Which

41:52

would also put price pressure on with

41:55

something interesting to think about it. I'm spec

41:57

- like obviously - like a cell wall.

41:59

Yeah, no, that's interesting. But I have to

42:01

think that's the most likely thing, right?

42:03

Are they really going to deal with like

42:05

physical delivery? Maybe, right, in a world

42:07

where like we're issuing fucking bitbonds, maybe people

42:09

just take it, but they could also

42:11

just liquidate it to dollars, but then it's

42:13

net neutral outside of the sentiment part,

42:15

which, you know, which would be huge, would

42:17

be very reflexive. I don't

42:19

know. I'm

42:21

just theorizing. It's good. I'm glad

42:23

the conversation is happening. There's definitely healthy

42:25

debate here. Totally. I

42:28

think it's interesting. Our

42:34

chat is getting bombarded by scambots, so

42:36

stay away from them if you're watching

42:38

on YouTube. I'm trying to

42:40

block them as I'm trying to block them

42:42

as we go here. Should I block that coin?

42:47

There's one rule. So

42:49

many people suggesting it.

42:51

KPI and KPI. This

42:54

is how it goes. This is

42:56

how it goes, guys. This is

42:58

how they generate market cap through

43:00

these scambots and posting it all

43:02

over the internet and getting people

43:04

to start buying retail. So whatever

43:06

this coin is, XAI68Z,

43:10

yeah, it's going down very soon. You're going

43:12

to see the dump very soon. That's

43:14

what this means. Instead of buying

43:16

this coin, you should buy some steps. Yeah,

43:19

don't scramble. Just a community

43:21

Bitcoin Bitcoin that crypto on a platform like

43:23

swan What else we got guys I

43:25

got a quick hit here if we're ready

43:27

for some quick hits check this out.

43:29

Okay, go ahead I was gonna say what's

43:31

I want to talk about the overall

43:33

theory I think something we haven't hit on

43:35

is just what's fucking happening? And where

43:38

is it going with all these negotiations in

43:40

the trade war like this has been

43:42

the elephant in the room? So I want

43:44

to talk about that so What

43:46

is it? Three, four weeks ago, time

43:48

has flown. Liberation day, yeah, beginning the month.

43:50

Liberation day happens. Trump announces a huge

43:52

amount of like reciprocal tariffs. And we've been

43:54

in like a roller coaster since then

43:56

of huge tariffs, rollback, 90 day pause, trade

43:58

deal, negotiation, stock market down, bonds up,

44:00

all this sort of stuff, right? So like,

44:02

where is it going? Are they, is

44:04

like the stock market going to keep crashing?

44:06

Are they going to negotiate these deals? Is

44:09

the bottom in? Is the bottom not

44:11

in? Is the U .S. economy about to

44:13

get blown up? People have a lot of

44:15

fear right now. There really are profound

44:17

anxieties in the market. Is the total monetary

44:19

order being overhauled? My take is that

44:22

the Trump put got hit. And

44:24

I think people have not been

44:26

ready to realize this, but the

44:28

moment Trump switched in Besant for

44:30

Lutnik and started talking the market,

44:32

90 -day pause, that was the

44:34

pain point being hit. It got

44:36

too painful. Since then, every day,

44:38

he has a message about the

44:40

market. I think

44:42

we can't go too much lower

44:45

without it really being a problem.

44:47

My view is what you start

44:49

seeing is you do start seeing

44:51

these trade deals, you start seeing

44:53

it rolled back, you see that

44:55

de -escalation with China. What

44:58

happens then? What happens then is

45:00

assets surge. is my view. If

45:02

you get a de -escalation of

45:04

this thing, and I really think

45:06

you will relatively soon within the

45:08

next two months, Bitcoin

45:11

flies. And I think just

45:13

people need to keep this in mind that we

45:15

are one headline away from this whole thing being

45:17

over. Absolutely. Jason,

45:21

I have some thoughts. I love how

45:23

Stephen hit the core of what every

45:25

macro and markets person is thinking right

45:27

now. Before I go, you want to chime in

45:29

with anything? Yeah,

45:31

no, I would agree with everything

45:33

Steven just hit on, honestly. And

45:35

especially, I think you pointed this

45:37

out earlier, going into the

45:39

2026 midterms, at least from an optics

45:41

perspective, they don't want everything deep

45:43

in the red. I don't think this

45:45

is like a sustained amount of

45:47

pain that we're looking at. Yeah,

45:50

my general view is that the

45:52

worst is behind us and negotiations

45:54

continued from here. And even like

45:56

last weekend, What was it

45:58

that came out over the weekend that

46:00

now consumer electronics were exempt from this?

46:02

So it's just it's slowly creeping back. And

46:05

yeah, I think we continue that

46:07

trend forward. Yeah.

46:10

I think what you guys say is reasonable. I'll

46:13

play the other side a little

46:15

bit. And to be honest, I'm more

46:17

so in your camp, but I'll

46:19

just play the other side and we

46:21

could talk about it. Historic periods

46:23

where. U .S. markets, let's just call

46:25

it by U .S. equities have been

46:27

flat or down. Three big

46:29

ones, 1929 to 1955. Late

46:32

60s till 81 or 82

46:34

was basically a flat period.

46:37

And then 2000 if you bought

46:39

at the top and then it

46:41

was like 2012 or 2013 that

46:43

the S &P as an index was

46:45

basically flat. So That's

46:48

the counterpoint. That's what people are

46:50

worried about here. They're worried, are we

46:52

entering a decade or more where

46:54

US stocks got so overheated and there's

46:56

these big changes to the trading

46:59

system, to the monetary system? This

47:01

could be a 10 to 15 year

47:03

period where equities are flat. You

47:05

guys are taking the other side

47:08

of that. I think I'm generally

47:10

taking the other side of it

47:12

for a few reasons. One is

47:14

that social political palatability of... equities

47:16

being down for a long time.

47:18

It's just not an easy message

47:20

to convey to people. Two

47:22

is that the US being

47:24

a financialized economy has this problem

47:26

where if stocks go down

47:28

a good amount, then tax receipts

47:30

go down a good amount,

47:32

GDP goes down a good amount,

47:35

and then you're in this vicious cycle where

47:37

debt to GDP is actually exploding. then

47:40

maybe there's a recession because of that

47:42

cycle I just outlined and then maybe you're

47:44

incentivized to spend more and then your

47:46

rates are going up and then the Fed

47:48

has to step in. So it's like

47:50

your hand kind of gets forced and all

47:53

of that would just cause markets to

47:55

rally again. So I just

47:57

wanted to play the other side that people

47:59

are worried about. They're asking themselves, are

48:01

we about to enter a period where stocks

48:03

might be flat to down for 10

48:05

to 15 years? I don't think that's

48:07

the case. I'm more in your guy's camp, but I

48:09

just wanted to play the other side of it

48:11

and see what you guys think. Yeah,

48:13

that's awesome. We've

48:16

got a question from the chat

48:18

from LinkedIn. I'll throw it

48:20

up. Is

48:22

a sailor, and this is just a good kind

48:24

of opportunity for some education, a sailor

48:26

leveraging debt to buy more Bitcoin

48:28

at this point. Is it just

48:30

bad money chasing away good monies

48:32

as Gresham's law? I

48:35

think you could say that, right? There

48:37

is a weak currency that he is borrowing

48:39

in and accumulating debt obligations in and

48:41

he's buying a stronger currency. So I think

48:43

on a very basic level, yeah, that

48:45

is descriptive. Speculative tech. That's

48:49

all structure. Yeah. People

48:52

do that with real estate too, by

48:54

the way. They borrow dollars and acquire

48:56

real estate and they expect it to

48:58

go up over 5, 10, 20 years.

49:00

So in some ways, this is not

49:02

completely unique to Bitcoin. Shorting

49:05

the dollar. It's

49:07

a great point. That is literally the whole real

49:09

estate system, right? Like real estate would look so

49:11

much different if you couldn't get a cheap loan

49:13

to buy it. You know what I mean? Yeah.

49:16

It wouldn't be an asset really.

49:18

It would just be a

49:20

consumption expense. Like it's only

49:22

an asset because of how you're funding it. And

49:26

yeah, and inflation and bailouts.

49:29

That continue to support it. 100%.

49:32

All right, here's one back to price for a

49:34

minute. Is Bitcoin going to

49:36

40k? No way,

49:38

not now. No

49:41

chance. It's a different paradigm. This

49:44

comes so far, and I don't

49:46

expect any huge downside. Yeah,

49:48

what have we been down 30, 35

49:50

% from the top? Briefly, briefly like

49:53

35%. Yeah, not very. Yeah. So that's

49:55

where I think the limit is now

49:57

with the size of the market and

49:59

the kind like the size of the

50:01

buyers that are in the market now.

50:03

I just don't think we're going to

50:05

see 80, 85 % drops anymore down just

50:08

it's I think we're beyond that at

50:10

this point. We shall see. But I

50:12

think there's pretty clear fundamental factors that

50:14

back that idea up. A few weeks

50:16

ago, we had every opportunity if there

50:18

was going to be that kind of

50:20

a drop for that to happen. And

50:22

what did we bottom at 75K? I'm

50:25

sure we were all ecstatic about a

50:27

year ago. A market panic. That's pretty

50:29

incredible. Yeah. The second, the

50:31

biggest or the second biggest market

50:33

panic in the past 20 years. Yeah.

50:35

More than that. Yeah. And

50:37

meanwhile, shit on arrival here,

50:39

Ethereum went back to 2022 bear

50:42

market levels during that time

50:44

period. And so. Yeah,

50:46

there was absolutely the chance for

50:49

that to happen. No, I'll see

50:51

40k happening. No way No, there

50:53

just seems to be such a

50:55

big bid for Bitcoin right now

50:57

Think about all the headwinds the

50:59

market's been facing for the last

51:02

three months And if I just

51:04

look at one of my kind

51:06

of charts of performance Bitcoin is

51:08

outperform over three months. Bitcoin's outperforming

51:10

Google the mag seven Amazon Nvidia

51:12

Tesla so like This is a

51:15

different paradigm than what we would

51:17

have seen three years ago, five

51:19

years ago. If

51:21

Bitcoin's at 40k, the

51:24

markets are absolutely being destroyed

51:26

and there's some crazy headline

51:28

that I can't even pretend

51:30

to imagine. And

51:35

on a final note there, like

51:37

the Trump administration is discouraging using the

51:39

equities, the US equities and bonds

51:41

market as a world piggy bank, right?

51:43

And so we see capital flowing

51:45

out of that. We see that going

51:48

back into gold. We see gold

51:50

surging up. Same thing

51:52

for Bitcoin. Bitcoin is a global

51:54

neutral asset, just like gold, right?

51:57

I think it's just an awareness thing. Gold's been

51:59

around for thousands of years, so that's going

52:01

to see that first. It's sniffing it out, but

52:04

it's the same type of principle. Yeah.

52:06

Similar to the liquidity chart that

52:08

we showed the Bitcoin price mapped over

52:10

earlier in the show, here's

52:13

Bitcoin versus gold, and gold

52:15

often pre -stages a Bitcoin

52:17

run, and gold is on quite

52:19

a parabolic run at the moment. Yeah.

52:22

Yeah. Market looking

52:24

lined up to do something pretty

52:26

interesting. All right, quick hit. We've

52:28

got this map here with the

52:31

red dots, and there's hundreds of

52:33

them all over the world for

52:35

those who are listening, basically covering

52:37

most of the planet at this

52:39

point. And these are natural gas

52:41

operations that are flaring gas into

52:43

the atmosphere right now. And

52:45

this is not CO2. This is

52:47

methane, which is an even a

52:49

lot more powerful greenhouse gas than

52:51

CO2 is. And it's just a

52:53

bunch of wasted energy that we

52:56

could capture and use. The

52:58

grid is not using it. That's why they're

53:00

flaring it. The demand isn't there, but it's very

53:02

costly and even dangerous to cap these wells. So

53:05

now we've got many operations, many

53:07

Bitcoin mining operations that are taking

53:09

advantage of this stranded or excess

53:11

energy and using it to mine

53:14

Bitcoin. The grid demand isn't there

53:16

and the energy companies will take

53:18

something for it. Sometimes they'll actually

53:20

sell this stuff or pay another

53:22

company to come out and somehow

53:24

utilize this this flared gas that

53:27

just happens from time to time

53:29

so in any case this is

53:31

a massive opportunity for bitcoin mining

53:33

and it's not just neutral for

53:35

the environment not only is it

53:37

just not a slight disadvantage for

53:40

the atmosphere for the earth it's

53:42

actually benefiting it bitcoin mining is

53:44

a green technology so for those

53:46

who are concerned about these issues

53:48

about the environmental issues which

53:50

has been one of the

53:53

biggest reasons that people hate Bitcoin

53:55

over the years is being

53:57

completely debunked at this point as

53:59

Bitcoin mining evolves and is

54:01

being pushed to these cheaper sources

54:03

of energy. So Bitcoin

54:05

mining is a green industry. It

54:08

is the greenest energy industry on

54:10

the planet. And I think it's

54:12

good to see people like Daniel

54:14

Batten and many others out there

54:16

just banging the table on this

54:18

whenever some mainstream reputable publication

54:20

just repeats this this fud from

54:22

over the past decade of Bitcoin's life.

54:25

And you can see the table

54:27

starting to turn that Bitcoin is actually

54:29

good for the environment. Like it's

54:31

flipped completely from what these people say.

54:33

So you remember Daniel Batten a

54:35

hundred. Am I right? And how long

54:37

he is. It's batten a thousand.

54:39

That's what you're looking for. I messed

54:42

it up. Yeah. The

54:44

Greenpeace campaign. This. pulls me back

54:46

to that, which was just a

54:48

really fun moment in Bitcoin history,

54:50

where Bitcoiners completely destroyed this Greenpeace

54:52

campaign that they spent millions of

54:54

dollars on and built this skull

54:57

with these flaring gas or these

54:59

gas things. I think they were

55:01

actually like nuclear power cooling towers

55:03

and laser eyes and it just

55:05

looked dystopian. And then Bitcoiners

55:07

just totally took it over. That's

55:09

freaking cool. This is awesome. We're going

55:12

to take this. And it went

55:14

nowhere. Their Twitter account didn't even get

55:16

100 followers. So I love

55:18

that. I think that narrative is

55:20

in the process of being completely

55:22

debunked at this point. Saw this

55:24

map, which makes a pretty big

55:26

impression on the opportunity for Bitcoin

55:28

miners to cap these wells and

55:30

protect the hardest money humans have

55:32

ever known. I

55:34

think those are all locations Stevens

55:36

walked to as well. A

55:38

good side note. It's

55:42

like horsegump, but I tore

55:44

Bitcoin flare gas mining. I

55:46

feel like I see a

55:49

lot less of those headlines these

55:51

days. Yeah, that shit got

55:53

blown out. It's dying out. It

55:55

really is. It really is. Did

55:57

you guys see the takes that a

55:59

lot of it is because of the

56:01

energy consumption of AI? Do

56:03

you guys buy that, that these

56:05

people were actually thinking that way?

56:07

Do you think that's just like

56:09

over analysis? Yeah, I think it's

56:11

just retconning it. I think it's

56:13

that like ESG took a big

56:16

fat L. Like I think it's

56:18

just like that era, like, I

56:21

think just that era of politicizing

56:23

is just behind us and we're in

56:25

a different kind of thing where

56:27

there's just not a lot of appetite

56:29

to push these big kind of

56:31

energy climate agendas. Like we're clearly in

56:33

a world where it's like, we're

56:35

concerned about growth and energy use. I think

56:37

it has changed. Yeah.

56:40

Same arguments were used against the Internet

56:43

back in the 90s that the

56:45

energy the Internet would require would destroy

56:47

the planet so Didn't turn out

56:49

that way Alright, let's wrap it up

56:51

guys. I want to share a

56:53

couple of pieces That were published on

56:55

the swan blog this week one

56:58

of them by Jason actually called this

57:00

time is different Jason. What'd you

57:02

write about here? Yeah,

57:04

this so this is something I

57:06

put out early last month just A

57:08

lot of the recent developments in

57:10

Bitcoin, particularly at the level, at the

57:12

executive level, strategic Bitcoin reserve, I

57:15

think this was like a week after

57:17

that announcement. I started working on

57:19

that piece, SAB 121

57:21

repeal of the FASB accounting

57:23

rule change. I think the

57:25

big picture here is just

57:27

that the Bitcoin investor demographic

57:29

is evolving rapidly. It's about

57:31

to evolve very rapidly. The

57:34

institutions are here. The corporations

57:36

are here. The nation states are here.

57:38

It's very bullish. And I just outlined some

57:40

of those recent developments. It was a

57:42

lot of fun. It's a great article. If

57:44

you haven't read it, check it out.

57:46

It's a great summary of all the big

57:48

wins politically for Bitcoin at the start

57:50

of this year. It's gotten a little overshadowed

57:52

by all the trade war, but that's

57:54

still all there. It's still as relevant as

57:56

ever, and it's still going to be

57:58

a huge catalyst for just what comes later.

58:00

There's been a lot of noise, but

58:02

Jason did a fantastic job like putting something

58:04

together. that you can just read any

58:06

time to focus on the winds that happened.

58:09

Yeah, absolutely. We also

58:11

published with Swan Research

58:13

a piece on, which

58:15

is really interesting, called

58:18

The Ghosts of Glass -Steagall. And

58:20

if the Glass -Steagall Act, it

58:22

was an important piece of

58:24

America's financial history, contributed to the

58:26

2008 financial crisis. And

58:29

it's all laid out here.

58:31

And Brett... compares the repeal

58:33

of Glass -Steagall to the repeal

58:35

of SAB 121, which we

58:37

very largely celebrated in the

58:39

Bitcoin world. And so I

58:41

really appreciate this view of caution about

58:43

how SAP 122 might affect the Bitcoin industry

58:45

in the future. So check out Swan

58:48

Research, go to swan .com, click on the

58:50

research tab at the top. We've got a

58:52

lot of great stuff there. And then

58:54

also want to shout out Mara, who is

58:56

one of the largest miners, the largest

58:58

public miner I believe in the world. And

59:00

they're doing amazing work to secure the

59:02

Bitcoin network and to support this show. So

59:04

we really do appreciate you all. Check

59:06

out Swan Private, which all three

59:08

of these guys represent a lot

59:10

of our clients. We have thousands

59:13

of clients in the Swan Private.

59:15

And it's an amazing service. It

59:17

creates really strong relationships with people,

59:19

with our clients. And they really

59:21

value this. We're not just another

59:23

exchange. We're actually a partner for

59:25

you to develop generational wealth. And

59:27

I would love for you guys

59:29

to be able to meet Steven,

59:32

John, Jason, and talk to them

59:34

about Bitcoin and your plans for the future.

59:37

Check that out at swan .com slash

59:39

privates. We also have a podcast version

59:41

of this show. Find it in

59:43

your podcast apps, just search swan signal.

59:45

We do this every Friday live

59:47

at 11 AM PT, 2 PM ET.

59:50

We've got myself and John and Steven always

59:52

here and we rotate in one of

59:54

our fabulous swan private reps every week

59:57

as well. And sometimes we bring on great

59:59

guests. We had Ben Workman and Lynn

1:00:01

Aldenon just a few weeks ago. so we'll

1:00:03

bring some more great minds to the

1:00:05

show soon enough. All right, everyone, we'll

1:00:07

end it right there. Thanks for joining us. Happy Friday.