Bitcoin & The Tale of Two Wolves

[0:01] Yo, welcome back to another episode of
[0:05] the Jack Mallers Show. I am your host
[0:07] Jack and you are listening to yet
[0:09] another edition of mailbag Monday.
[0:13] Every Monday 6:00 p.m. Eastern all
[0:16] signal no noise. This is episode 117 and
[0:20] today we're talking about Bitcoin and
[0:22] the tale of two wolves.
[0:25] Before we get started, let me timestamp
[0:27] this bad boy. Ladies and gentlemen,
[0:30] thank you all for joining me in this
[0:33] very unique corner of the internet once
[0:35] again as I talk to you all at a Bitcoin
[0:37] price of $81,900
[0:41] US per Bitcoin. That puts Bitcoin's
[0:44] market cap at 1.64
[0:46] trillion US dollars. Our all-time high
[0:49] remains at 126,160.
[0:52] We are now only 35% down from that
[0:56] all-time high. Don't look now, here
[0:58] comes the coin. We made that all-time
[1:01] high 217 days ago on October 6th, 2025.
[1:07] The last Bitcoin block mined before I
[1:10] hit stream
[1:11] is Bitcoin block height 949,003.
[1:16] How are you beautiful people doing? The
[1:19] sun is out in Chicago. I'm walking to
[1:22] the gym with my shorts on and a t-shirt.
[1:25] Bitcoin is back. There's so much to
[1:28] discuss. So, without further ado, let's
[1:31] get this show on the road.
[1:34] Okay, Bitcoin and the tale of two
[1:37] wolves. Uh I think everyone should be uh
[1:40] familiar with the tale of two wolves, um
[1:42] but it it's the uh What are these
[1:44] called? These like age-old
[1:47] Is it just a tale? I don't know. These
[1:49] age-old The point is there's a tale two
[1:52] wolves. One is evil, one is good, and
[1:54] whichever one you feed more wins. And
[1:59] that's kind of I was listening this
[2:01] podcast by this guy named Warren Pies,
[2:03] really good macro researcher guy, been
[2:06] reading some of his stuff.
[2:08] And he was talking about the tale of two
[2:10] wolves as it relates to markets today.
[2:13] As on one side of the market, you have
[2:15] AI and this productivity boom and you've
[2:18] got the US government spending at, you
[2:20] know, 6% deficit to GDP. So, there's so
[2:23] much money being poured into the
[2:26] economy, into the world from, you know,
[2:30] from fiscal dominance, from the US
[2:32] government. And the government spending
[2:34] is someone else's profit. You combine
[2:36] that with AI, which is one of the
[2:37] greatest productivity booms we've maybe
[2:40] ever seen, and you get crushing EPS,
[2:44] revisions up, growth up, Mag 7 is back,
[2:48] stock markets at all-time highs, growth,
[2:50] growth, growth, number go up, boom,
[2:53] boom, boom, economy to the moon. Now,
[2:56] the other wolf is what we've been
[2:57] talking about with the Strait of Hormuz,
[2:59] the conflict in Iran. These are, you
[3:02] know, physical limitations that the
[3:03] world is going to have to deal with at
[3:05] some point. You know, what's been
[3:08] impressive is the AI boom and all the
[3:10] productivity going on in the stock
[3:12] market
[3:13] has somehow made all-time highs despite
[3:17] 20% of the world's oil supply going
[3:19] entirely offline. It is honestly
[3:21] remarkable. If there was no conflict in
[3:23] Iran, I have no idea where the stock
[3:27] market and assets like Bitcoin would be.
[3:29] Who knows? But the fact that Bitcoin's
[3:32] above 80,000, we I said last episode,
[3:35] you've got this 80 to 82,000 dollar
[3:38] range where Bitcoin blows through that,
[3:41] get on board or get out of the way. And
[3:45] if Bitcoin continues to struggle with
[3:46] that, we might see a revisit of the 70s
[3:49] and maybe 60s. So, it's the fact that
[3:52] Bitcoin is trying to push its way
[3:54] through and the stock market is making
[3:56] all these all-time highs when we have
[3:59] record oil short oil shortages. We've
[4:01] got gas prices that bring us back to
[4:04] 2022. I mean, it is remarkable the tale
[4:06] of two wolves and the two stories going
[4:08] on within today's market. What a time to
[4:12] be alive and be contributing and being a
[4:14] Bitcoiner right now. I mean, we are
[4:16] living through I mean, things like AI
[4:19] and seeing it it's it's working. I mean,
[4:21] we'll go through this thing is working.
[4:24] And Bitcoin is monetizing as a
[4:26] multi-trillion dollar asset class.
[4:30] I mean, the death of the 1971 dollar,
[4:32] you're seeing gold remonetized out east.
[4:35] It is
[4:36] you know, you can be a doomer and
[4:37] gloomer. There is plenty of excuses to
[4:40] do that. But, I mean, what a cool
[4:42] opportunity to be a human and contribute
[4:45] to the human story. I mean, this is a
[4:47] fascinating time to be alive. So, first,
[4:50] I said every single week we're going to
[4:51] check in on the four questions because
[4:53] we're not going to turn into a political
[4:54] show. We're not going to fall for that.
[4:57] We're going to ask these four basic
[4:58] questions about the conflict in Iran.
[5:00] And if these don't change and there's no
[5:02] substance to this, we're not going to
[5:04] fall for the headlines. We're not going
[5:05] to We're not going to run our mouth
[5:07] about politics.
[5:09] Um I'm going to save us all from that.
[5:10] I'm going to save myself from that
[5:12] because the answers week over week
[5:14] continue to remain unchanged.
[5:17] So, before you waste time, answer these
[5:19] first. One, is the Strait of Hormuz
[5:22] still closed? The answer is yes, guys.
[5:25] Question two, is the conflict still
[5:27] ongoing? The answer is yes. Actually, as
[5:30] of this morning, Monday, May 11th, peace
[5:32] talks deteriorated. We are back to
[5:36] potential escalation. And so, the
[5:38] conflict is still ongoing. Question
[5:41] number three, are global supply chains
[5:43] still disrupted? The answer is yes. This
[5:46] is a derivative of the Strait of Hormuz
[5:48] still being closed. So yes, absolutely
[5:50] global supply chains continue to be
[5:52] disrupted. And then question number
[5:53] four, can global debt survive this
[5:56] disruption? The answer remains no. We're
[6:00] seeing the bond market and yields
[6:02] continue to go up, which presents itself
[6:04] as a big problem to this highly
[6:06] indebted, highly leveraged system. You
[6:09] can think of the global fiat system and
[6:12] especially the western markets that run
[6:13] these massive deficits and have such
[6:15] debt, you could think of them as these
[6:17] highly leveraged big machines. And
[6:21] leverage does not like volatility.
[6:23] Leverage does not like sudden change.
[6:25] And so anything like AI, anything like a
[6:29] change in consumer spending, anything
[6:31] like global supply shortages, anything
[6:33] like an oil shock,
[6:35] that is not going to bode well with a
[6:37] highly leveraged system. That's, you
[6:39] know, why such debt and such leverage is
[6:42] untenable is things have to effectively
[6:44] go perfect. And unfortunately, you know,
[6:47] we live in a world of entropy.
[6:49] We don't, you know, the state of the
[6:52] universe that we all share is you can't
[6:54] change the past and you don't know the
[6:56] future. All we have for certain is the
[6:59] now. And so you cannot, you cannot see
[7:03] yourself forward with such substantial
[7:05] leverage. It is bound to get tipped over
[7:08] even by the most brisk tiny gust of
[7:11] wind.
[7:12] So
[7:13] just to check in on the Strait of
[7:14] Hormuz,
[7:16] this visual, this is, you know, the the
[7:17] Strait of Hormuz vessels that are
[7:19] crossing viewed through the Bloomberg
[7:21] terminal. I mean, I I just don't know
[7:24] how else to say that it remains
[7:26] unchanged. You can see at the end of
[7:27] February this fall off a cliff. Iran
[7:31] shut the Strait of Hormuz and despite
[7:34] all of the rumors and the headlines and
[7:36] the politicians going back and forth on
[7:38] social media against each other, I mean,
[7:40] it's been fairly consistent. Some
[7:42] vessels have gone through and there was
[7:44] a point in time where they were
[7:45] accepting payment in CNY or Bitcoin.
[7:48] And but more or less, the strait's been
[7:51] just closed. Strait's been closed and
[7:54] there has been real world consequences
[7:56] for 20% of the oil market going entirely
[8:00] offline.
[8:03] Now back to the two wolves, okay? So
[8:05] there we go. We're done with the Iran-US
[8:07] conflict. You guys can thank me in the
[8:09] comments. No more political podcast.
[8:11] Apologize for that chapter in my life. I
[8:13] just couldn't take it anymore. It was
[8:15] getting absurd. We're not going to fool
[8:17] ourselves into wasting time there.
[8:18] Let's talk about the market and where
[8:20] the world is going. And this tale of two
[8:22] wolves to me is a fascinating concept
[8:24] because you do have this massive
[8:26] productivity. The economy is running so
[8:29] hot right now. Like the US is running so
[8:32] hot. They've got $500 billion of annual
[8:35] QE. Remember when Powell started this
[8:37] repurchasing thing back in December. So
[8:39] for those that don't remember or maybe
[8:41] you weren't listening to the show,
[8:43] the Federal Reserve and and the chair
[8:45] Jerome Powell,
[8:47] we were in QT, which is quantitative
[8:48] tightening. And this was after all the
[8:50] gushing amounts of liquidity post-COVID.
[8:52] So for the last many years now, the the
[8:55] Fed was
[8:56] shrinking its balance sheet and we were
[8:58] in quantitative tightening, which you
[8:59] know, I think of Bitcoin as both an
[9:03] expression of fiat liquidity and
[9:05] technology innovation. So Bitcoin to me
[9:07] is some combination of the two. People
[9:09] will try and say, "Oh, Bitcoin is just a
[9:12] tech stock." I think in some parts
[9:15] they're right. It is a technology.
[9:18] Now people will then also say Bitcoin is
[9:20] just digital gold. In some parts, I
[9:22] think that's true. Bitcoin is the
[9:24] hardest money humans have ever
[9:25] conceived. So I think to me it's some
[9:28] combination of the two. And so obviously
[9:30] when you have a retraction in liquidity,
[9:32] when the Fed is shrinking its balance
[9:33] sheet, that's not necessarily good for
[9:36] assets that are continually priced on
[9:38] future expectations of fiat, okay? So,
[9:42] the Federal Reserve ended that. There
[9:44] were serious liquidity uh scares.
[9:47] There's There's a scarcity in liquidity.
[9:48] You can see it in some of the overnight
[9:50] funding markets. And so, in December of
[9:52] 2025, so what, it's May, 6 months ago,
[9:55] uh the Fed said, "We're ending QT.
[9:58] We're not necessarily starting QE, but
[10:00] we are going to expand our balance
[10:02] sheet." And everyone listening that's
[10:03] more of a layman's, you know, this show
[10:04] is the common man by the common man for
[10:06] the common man, like what the hell does
[10:08] that mean? What do you mean it's not QE,
[10:10] but the balance sheet's growing? It's
[10:11] effectively QE. They called it a
[10:13] repurchasing program. I mean, these guys
[10:15] are politicians at the end of the day,
[10:16] right? And they're not going to
[10:18] blatantly in your face say they're
[10:19] debasing your currency and inflating
[10:21] assets. That's what everyone knows as QE
[10:25] nowadays. So, QE's like a bad word.
[10:26] They're never going to explicitly say
[10:28] it, but they're going to find a way to
[10:30] print the money. And that's what they
[10:32] started in December. Now, if you guys
[10:34] remember, it was supposed to end in
[10:36] April.
[10:38] It is now May.
[10:39] It has not ended. And it cracks me up
[10:42] every time cuz they didn't go on TV and
[10:44] let everyone know. They didn't write a
[10:45] blog post. They didn't say, "Hey, we
[10:47] want to update the fact that this was
[10:50] supposed to end on tax day, and we're
[10:52] going to keep the program going."
[10:54] They did none of that, okay? The US
[10:56] government continues to find liquidity
[10:58] to taper off bond market problems. So,
[11:01] these yields keep going off. They keep
[11:03] finding liquidity to juice markets. They
[11:05] keep running it hot. And you've got this
[11:07] run it hot mentality from the US
[11:09] government running at 6% deficit to GDP.
[11:13] That's so much. People keep comparing
[11:16] what's going on in the stock market
[11:17] today to the uh tech boom in the uh late
[11:21] '90s, early 2000s, but
[11:24] back then the government was running a
[11:26] 2% surplus.
[11:29] So, the government is juicing the
[11:30] economy way more, way more. They're
[11:33] running it so hot, and you combine that
[11:36] with AI, which is genuinely one of the
[11:39] most productive technologies we've ever
[11:41] seen. It's incredibly deflationary. The
[11:44] just just the idea
[11:47] that the marginal cost of intelligence
[11:50] is
[11:51] free in your pocket as long as you have
[11:54] a smartphone.
[11:56] Crazy.
[11:57] Now, the fact that at the same time,
[12:01] while all that is going on, record
[12:03] government spending, record deficits,
[12:05] record tech innovation, record
[12:07] deflationary technology running into a
[12:11] highly indebted financial system, at the
[12:14] same time, we're seeing the
[12:16] remonetization of gold for the first
[12:19] time in at least 50 years, but probably
[12:22] longer,
[12:23] and we're seeing conflict in the Middle
[12:25] East where the US can't seem to open the
[12:28] Strait of Hormuz, and so it's being held
[12:31] like the the Iran is basically saying,
[12:33] "We're going to shut down the global
[12:35] economy unless you get off our back."
[12:37] And that conflict is still ongoing. And
[12:39] so you're seeing real physical shortages
[12:42] all over the world. Real physical
[12:45] shortages in Japan. Real physical
[12:47] shortages throughout Europe. Now real
[12:49] physical shortages entering the United
[12:51] States. The fact that both of these are
[12:53] happening at the same time,
[12:55] I mean, as a Bitcoiner, this is
[12:58] fascinating. It's crazy. It's cool.
[13:02] Uh like I said, I mean, you don't let
[13:06] allow life to come from you, not at you,
[13:08] right? You have every excuse if you
[13:10] want, especially if you're of the
[13:11] younger generation, you're my age, you
[13:13] have every excuse to be sad, to be
[13:15] angry, um
[13:16] to be disgruntled,
[13:19] but I choose to be energized by these
[13:22] opportunities, energized by the fact
[13:24] that I'm blessed to be alive while the
[13:26] world is changing. So, that's what I
[13:28] mean by the tale of two wolves here is
[13:30] these two competing massive macro
[13:34] movements. Now, at the end of the day,
[13:35] it doesn't really matter how they shape
[13:37] up cuz Bitcoin's going to go up no
[13:40] matter the direction we walk, and that's
[13:42] why my recommendation continues to just
[13:44] be stay humble and turn on your DCAs.
[13:46] For as a reminder, Strike's got no fee
[13:48] DCAs, no fees to withdraw to cold
[13:50] storage. I I I think it is very
[13:52] dangerous game to try and guess how this
[13:55] how the world is going to progress. I
[13:57] mean, even the smartest minds in the
[13:58] world aren't living a version of the
[14:01] universe that has played before. I mean,
[14:03] this is a one of one time to be alive. I
[14:06] just just turn on your DCAs, but for the
[14:08] sake of the show, again, Bitcoin's a
[14:10] problem or excuse me, Bitcoin is a
[14:12] solution to a problem. I like
[14:15] understanding the problem, understanding
[14:16] what it means for the world, for those
[14:18] around us, how we can educate people.
[14:20] So, that's what we'll do on the show.
[14:22] The tale of two wolves. So, Main Street
[14:24] versus Wall Street. I want you guys to
[14:26] look at this. Uh in the blue line is
[14:28] Wall Street S&P 500, and the red line in
[14:31] this visual is Main Street consumer
[14:34] sentiment, and it's moving in opposite
[14:36] directions. And the tweet writes, "The
[14:38] gap between Wall Street and Main Street
[14:40] has never been wider." US consumer
[14:43] sentiment fell 1.6 points in May to
[14:46] 48.2, which is an all-time
[14:49] low. Guys, yes, all-time low as in below
[14:52] the 2008 financial crisis, below the
[14:55] 1980s recession. I'm telling you
[14:57] all-time low consumer sentiment on Main
[15:00] Street. All-time low for consumer
[15:03] sentiment for the everyday person. The
[15:05] brick by brick, the salt of the earth,
[15:07] just the normal people. They want to
[15:09] have family, they want to own a home,
[15:11] they want a good life.
[15:13] Never been worse.
[15:15] Now, at the same time, the S&P 500 is
[15:18] trading at an all-time high of 7,400.
[15:24] Wall Street at all-time highs, Main
[15:26] Street is in a crisis. This is going to
[15:29] be the theme of this show. So, here are
[15:31] my two wolves, okay? On one one side,
[15:34] you have this boom. So, the S&P Q1 EPS
[15:37] is up 27%
[15:39] year-over-year. That's EPS, earnings per
[15:42] share. That is absolutely outrageous.
[15:46] EPS revisions keep going up. So,
[15:48] companies are revising their EPS, their
[15:51] future forward-looking. They keep
[15:53] revising them up. We'll get into that
[15:55] graph in a second.
[15:57] Forward-looking token consumption of AI
[16:01] is up 24x over the next four years. That
[16:05] is absolutely absurd.
[16:08] Tech over spy ratio, so how dominant is
[16:11] technology in the overall market right
[16:14] now? It has surpassed the dot-com highs
[16:17] of the late '90s and early 2000s. And
[16:19] the S&P 500 is at an all-time high. So,
[16:22] on one side, again, you have an absolute
[16:25] boom, productivity, growth, real cash
[16:29] flow. And again, is this another dot-com
[16:33] bubble? Maybe. I don't know. That's why
[16:36] I'm a You know one of the reasons I'm a
[16:38] bitcoiner is because I'm not that I'm no
[16:41] genius. I'm no um
[16:43] the great uh short uh stock picker
[16:47] running. Nah, I just stay humble, I
[16:49] stack sats. It's It's really that
[16:52] simple. I've outperformed all these
[16:54] financial gurus that sit with their
[16:57] little models and pluck around all
[17:00] night. I I've outperformed all of them
[17:03] over the last 14 years by very simply
[17:05] staying humble and stacking sats. So, I
[17:08] have no idea if this is another dot-com
[17:10] boom, but it's just AI instead of
[17:12] dot-com. However, what I will say is
[17:15] it's not so clear to me. I think people
[17:17] are drawing those conclusions just to
[17:19] benefit their peace of mind because the
[17:22] government was running a 2% surplus
[17:25] back then. We're now to 6% deficit. The
[17:28] reason that those that's such a stark
[17:30] difference is because there's so much
[17:32] more liquidity being plowed into the
[17:35] economy.
[17:37] Government spending is the private
[17:39] sector's revenue. It's the private
[17:41] sector's profit. Keep that in mind.
[17:43] They're pouring gasoline on to the fire.
[17:46] You see? And so it's the combination of
[17:49] there's actually an opportunity to
[17:51] deliver deflationary forces, to deliver
[17:53] technology innovation, to grow margins,
[17:55] to grow profit. You're seeing companies
[17:58] replace humans with AI. They're growing
[18:00] their margins. They're growing their
[18:01] gross profit. They're revising their EPS
[18:04] on a go-forward basis. And they're
[18:06] getting all the tailwinds and support
[18:08] from further and further and further
[18:10] government spending, further and further
[18:11] and further debasing of the currency.
[18:13] Now, the other side, the other wolf, is
[18:16] that gas is approaching $5 a gallon.
[18:19] It's going higher. The 30 The 30-year
[18:21] yield just crossed 5%. Supply chains are
[18:25] completely collapsing. Consumer
[18:27] sentiment in Main Street is at an
[18:29] all-time low. And the Strait of Hormuz
[18:31] remains closed with no clear path of how
[18:34] it will open.
[18:36] How crazy are these two wolves?
[18:40] Nuts.
[18:43] It's really and and and I've talked
[18:44] about it before.
[18:46] Is Bitcoin about to go to 150,000 or is
[18:49] it going to retest 60,000?
[18:51] I don't know. IDCA. I buy Bitcoin with
[18:54] my paychecks on Strike. I It's not
[18:57] That's above my pay grade. You want to
[18:59] know what's in my pay grade? Spending
[19:01] time with my fiance planning our
[19:03] wedding,
[19:04] lifting heavy things and going for a run
[19:06] now that the sun's out in Chicago,
[19:08] hanging out with my friends, building
[19:10] Bitcoin products for the Bitcoin economy
[19:12] at my two companies. I'm not You're not
[19:14] going to catch me up all night drinking
[19:16] energy drinks, stock picking. No, no,
[19:19] no, no, no.
[19:20] I don't know. I don't care. I This is
[19:22] all entertainment. I don't care. Okay?
[19:24] But, what a fascinating timeline to be
[19:27] living through. Okay? Now, this chart
[19:31] says the same thing. It expresses the
[19:32] same idea of this Wall Street versus
[19:35] Main Street. This is the the people bear
[19:38] the brunt and the tax ultimately because
[19:41] they are the currency holders and their
[19:43] wealth is being debased and the asset
[19:46] holders, the upper 10% of the economy,
[19:49] the people that own all the stocks, that
[19:51] own the real estate, that own the assets
[19:53] that are being inflated. So, this tweet,
[19:55] "If you work for a living, your share of
[19:57] GDP has never been lower. If you hoard
[20:00] capital for a living, your share of GDP
[20:03] has never been higher." And the visual
[20:05] shows stock market as a share of GDP,
[20:08] all-time highs. Total wages as a share
[20:11] of GDP, all-time lows.
[20:15] And this will be a consistent
[20:16] underpinning of today's show.
[20:19] This is what fiat does. It erodes the
[20:22] middle class. It taxes the bottom and
[20:26] benefits the top.
[20:28] It's not necessarily Jeff Bezos's fault
[20:32] that he's getting wealthier while doing
[20:34] while while on his yacht with his new
[20:36] wife.
[20:38] It's because he owns a lot of assets. He
[20:40] owns a lot of Amazon. He owns a lot of
[20:42] real estate. He owns a lot of stuff. And
[20:45] you're seeing inflation in everything
[20:47] except the currency.
[20:50] Bitcoin is inflating. Amazon stock is
[20:52] inflating. Eggs are inflating. Real
[20:54] estate is inflating. Oil is inflating.
[20:57] Energy is inflating. It's all inflating
[21:00] in dollar terms because the dollar is
[21:03] being devalued.
[21:05] And so, if you can afford assets, you
[21:08] are benefiting from what this tweet
[21:10] describes as hoarding capital. Just
[21:13] owning stuff.
[21:15] Now, if you cannot own things, if you
[21:18] are part of the population, oops.
[21:21] If you are part of the population that
[21:22] cannot quite get a house yet,
[21:25] that doesn't have a excess cash flow
[21:28] to invest in stocks yet,
[21:31] that can't find a way to to buy some
[21:35] Bitcoin,
[21:37] well, you're getting crushed because
[21:38] every single paycheck, total wages as a
[21:40] share of GDP is getting you less and
[21:42] less and less of a slice.
[21:43] Because all of the US dollars, the cuck
[21:46] bucks that you're getting bi-weekly as a
[21:49] form of a paycheck, every time that hits
[21:51] your account and payroll is processed
[21:53] and you got paid, it's getting you less
[21:56] stuff. You're getting further away from
[21:58] ever owning a home, further away from
[22:00] ever being able to stack sats. 15 years
[22:03] ago, if you wanted to stack sats, a
[22:05] Bitcoin was a dollar. Now, a Bitcoin's
[22:07] $82,000.
[22:10] As time goes on, you're getting further
[22:13] away.
[22:14] You see?
[22:17] And by the way, we'll get into this as
[22:18] well. I mean, this causes societal
[22:21] distress. People start fighting. People
[22:23] get violent.
[22:25] Really, really not good. Okay, wolf
[22:27] number one, the AI earnings boom.
[22:30] So, more color on what I was saying, the
[22:32] S&P 500 Q1 earnings per share growth 27%
[22:36] year-over-year. Guys, that's outrageous.
[22:38] The US economy is running it hot. QT is
[22:41] over. This weird version of QE that
[22:44] they're not actually calling QE is on.
[22:47] There's liquidity coming from all angles
[22:49] of all sizes. There's a conflict in the
[22:51] Middle East. That's certainly highly
[22:54] inflationary. And you've got this AI
[22:56] boom that's actually working. The
[22:59] numbers are in. Companies are getting
[23:01] more efficient. Uh margins are growing,
[23:03] gross profit is growing, costs are
[23:05] coming down. It's happening. Uh EPS
[23:08] revisions. So, companies are revising
[23:11] their future expectations up, not down.
[23:15] Goldman Sachs came out with a report
[23:17] that they believe token consumption is
[23:18] going to near 25x by 2030. And the other
[23:22] thing is that the stock market loves
[23:24] when volatility is down. There is a
[23:26] brief period where the VIX was at 30.
[23:29] Bitcoin really struggled, the stock
[23:31] market really struggled. Volatility was
[23:34] back at 17 going into the weekend, and
[23:36] the market loves that. Low volatility,
[23:39] massive growth, and that massive growth
[23:41] is backed by real cash flow because AI
[23:44] is working.
[23:46] So, the contrarian signal, everyone
[23:49] hates it, and that's kind of the point.
[23:51] Is that everyone's comparing this to the
[23:53] dot-com bubble, max bearish sentiment is
[23:56] expressed on the Mag 7.
[23:58] But this thing continues to rip. It
[24:01] continues to rip the faces off of
[24:02] everybody. And, you know, to advocate
[24:05] for wolf number one,
[24:08] it's despite conflict in the Middle
[24:10] East, despite the Strait of Hormuz still
[24:12] being closed, despite higher oil prices,
[24:15] despite what seems to be inflation baked
[24:18] into the cake. It's too late at this
[24:19] point. If the Strait of Hormuz were to
[24:21] reopen today, it doesn't really matter.
[24:23] Inflation in the next 3 to 6 months is
[24:26] seems to be a guarantee to me. And the
[24:28] longer that this goes on, the more
[24:30] physical reality is going to have to
[24:32] impose itself at some point. I hope it's
[24:34] not a disastrous financial crisis. I
[24:37] hope that it doesn't, you know,
[24:38] wipe total Western economies just off
[24:41] their feet. Um but it's real. Now,
[24:44] despite all of that,
[24:46] I mean, the the market is absolutely
[24:49] ripping. So, here is the Q1 27.1%
[24:53] year-over-year growth.
[24:55] This is uh the largest strongest growth
[24:59] since Q4 of 2021. And remember how hot
[25:02] that was. That was post COVID. So just
[25:04] look at the size of the growth there on
[25:07] the far right just to give you guys an
[25:09] idea of how absolutely insane this is.
[25:13] I've talked for years now that the
[25:15] pending liquidity that's going to be
[25:17] coming online just as a result of math
[25:19] and all the deficits and all the debt is
[25:21] COVID level ask if not significantly
[25:24] larger. So this to me comes as no
[25:26] surprise. It still is crazy to see. Um
[25:30] EPS revisions. So companies revising
[25:33] their forward EPS. Look at the
[25:36] historical average from 2011 to 2025.
[25:39] That is the black line below. They're
[25:43] revising down
[25:45] 2026. Just to give you guys an idea of
[25:47] how unique this is. I mean one line is
[25:51] going up, the other goes down. This is a
[25:54] crazy amount of EPS revisions.
[25:57] This shows that probably at least for
[25:59] the next few quarters the stock market
[26:02] is going to rip. Things are going to be
[26:04] run extremely hot. Now again,
[26:07] the the question that all analysts are
[26:09] asking themselves is well, what's going
[26:11] to happen? Are one day are we going to
[26:13] wake up and no one has any oil and the
[26:15] world basically shuts down?
[26:18] Yes, it looks like that's the case.
[26:21] >> [laughter]
[26:22] >> I don't I don't obviously I don't think
[26:24] that the US government is going to allow
[26:25] for that. So whether they concede in the
[26:27] conflict, whether there's some peace
[26:29] terms that actually aren't great for the
[26:31] US. It seems to me like Trump is really
[26:34] buying time till his meeting with China
[26:37] President of China and maybe trying to
[26:39] get China to lean on Iran a little bit.
[26:42] But basically the point is like how much
[26:44] can the US stock market rip on the on
[26:47] the tailwinds of government deficit
[26:49] spending in AI and all of this
[26:51] productivity
[26:53] while we're in like a Main Street
[26:55] depression.
[26:57] I don't know the answer to that. This is
[26:58] why I stay humble and stack sats. If
[27:00] Bitcoin goes up to a 150k, I'm the
[27:03] happiest man in the world. If Bitcoin
[27:04] goes down to 50k, I'm the happiest man
[27:07] in the world. I'm productive. I live my
[27:09] life in a profit. I run my companies in
[27:11] a profit and I I don't mind. I buy the
[27:13] coin no matter what. I lower my time
[27:15] preference. I'm happy, okay? But, I mean
[27:18] this is crazy, right? This is the
[27:20] Goldman Sachs token consumption that I
[27:22] was referencing. This is their estimated
[27:24] 24x by 2030. And you're seeing, you
[27:28] know, the three core segments of
[27:30] consumption. Enterprise agents to me is
[27:33] what's been I mean, the level of growth
[27:36] here is crazy. Crazy.
[27:39] Like, something happened in December,
[27:41] January recently and now all of these
[27:44] companies have fully MCP'd their tech
[27:47] stack and are firing humans and
[27:50] replacing them with AI and it's working.
[27:52] I mean, Block's earnings was super super
[27:55] impressive. Their AI strategy seems to
[27:57] be working. Here is this XLK over spy.
[28:01] This is tech over the S&P 500.
[28:05] Basically, how much of the S&P 500 in
[28:08] ratio terms is technology. And what I
[28:12] think is interesting is we are now
[28:15] overweight technology relative to the
[28:17] dot-com bubble all-time highs.
[28:20] And this just goes to show how strong
[28:22] I've always said on the show, to me, the
[28:25] story of humanity is the story of
[28:27] engineering a better world. I think
[28:29] we're living in a technology era where
[28:32] intelligence is going digital. Money is
[28:35] going digital. You know, technology is
[28:39] the greatest investing trend of our
[28:41] time.
[28:43] And I think that this chart's going to
[28:45] only go higher. I
[28:47] I really think things going digital like
[28:51] things like uh meta and uh Apple and
[28:55] Amazon, you know, digitizing
[28:58] uh the marketplace, which is what Amazon
[29:01] has done, uh and dematerializing having
[29:04] to walk into a real store to live your
[29:07] life and acquire the goods and services
[29:09] you need. You can just go on your phone
[29:11] and it's at your door in an hour.
[29:14] That's insane. I mean, Apple has
[29:16] dematerialized and digitized everything
[29:20] that you used to need. Your like walking
[29:22] around with a camera and going to get uh
[29:25] your camera roll printed at CVS, right?
[29:29] Your phone book. You used to have a
[29:30] yellow pages, right? Like think about
[29:33] all of the things that now live in your
[29:35] pocket on a single device totally
[29:38] digitized.
[29:39] Facebook has taken or Instagram,
[29:41] whatever social media you use, has taken
[29:45] your physical life and digitized it. So,
[29:49] this trend now Bitcoin has done it with
[29:51] money. AI has done it with intelligence.
[29:55] I think this is a fascinating trend
[29:57] where people are saying, "Oh, this is a
[29:58] bubble. This is a bubble." Like the this
[30:01] uh technology over S&P 500 is going to
[30:04] have to go down. I'm not so sure about
[30:06] that. Um so, anyway, this is more of
[30:10] this Warren Pies guy um who I've been uh
[30:12] listening to more and more.
[30:14] He makes this point where he says, "In
[30:17] 2000, the government ran a 2% surplus.
[30:20] Today, that deficit is 6%." So, the the
[30:24] the backdrop is entirely different. The
[30:27] point is
[30:29] they're running it so hot. There's so
[30:31] much deficit spending, so much tailwinds
[30:34] for the economy and for these businesses
[30:37] that
[30:39] that's number one is that the fiscal
[30:42] backdrop is entirely different. Point
[30:44] number two is that the dot-com companies
[30:46] weren't actually building anything
[30:48] valuable. So,
[30:51] you know, the famous dot-com boom is
[30:53] like pets.com. pets.com was like one of
[30:56] the biggest companies in the world and
[30:57] everyone realized like pets.com can't
[30:59] make any money and no one gives a
[31:01] crap about pets.com. Versus today, the
[31:05] argument is are people actually working
[31:08] on vaporware like pets.com or is this
[31:11] mag seven? What these are companies that
[31:14] generate the most cash flows ever. Like
[31:16] these are cash printing machines and
[31:19] they're actually building real stuff.
[31:22] So, you know, the bubbleness I I
[31:25] understand that PE ratios look absurd,
[31:29] but I'd make the argument that they're
[31:31] not and that there's real cash flow
[31:33] backing this and that AI is far more
[31:35] real than pets.com. So, anyway, are we
[31:38] in a bubble?
[31:40] I don't know I don't know. I mean, I
[31:42] don't know. But but bubbles are
[31:44] hard to define. Fiat is one giant
[31:47] bubble, for sure. No doubt.
[31:50] As a Bitcoiner, everything goes down
[31:52] against Bitcoin cuz everything is in
[31:54] abundance against the only scarce thing
[31:56] I can [snorts] own, right? As long as
[31:58] there's going to be more companies, more
[32:00] houses, more eggs, more oil and there's
[32:03] never going to be any more Bitcoin,
[32:05] well, then oh,
[32:07] the world will fight over their bubbles
[32:09] and I'll sit humbly with my sats
[32:12] enjoying a deflationary trend.
[32:14] Everything in my life will get cheaper
[32:15] forever as a Bitcoiner. So, is this a
[32:17] bubble? Is that a bubble? All I'm saying
[32:19] is I'm seeing a tendency
[32:22] to compare what's happening today to the
[32:25] dot-com bubble in late '90s and the
[32:28] 2000s and I just don't I I it feels lazy
[32:31] to me. It feels lazy to me. Like the
[32:34] fact that Google, Amazon, Meta, all
[32:37] these companies are spending all the
[32:39] money they are on AI, I feel like that's
[32:42] not the same as pets.com. Like, can we
[32:44] just say that? You know? It's like I
[32:47] don't think Google, who's like making
[32:51] hundreds of billions of dollars over the
[32:53] years and is pouring that into
[32:57] like
[32:58] creating infinite digital intelligence.
[33:00] I don't think that that's the same as
[33:01] like
[33:03] Mark Cuban's sports broadcasting
[33:05] startup.
[33:09] Anyway, I digress. So, now wolf number
[33:12] two is this real economy.
[33:14] And so, again, you have whatever you
[33:16] want to call it, the K-shape, the wealth
[33:17] gap, the evisceration of the middle
[33:20] class. This is all what happens with
[33:22] fiat is there's such a divorce between
[33:25] the real world, the physical world being
[33:28] governed by mother nature, and this
[33:30] la-la foo-foo land. It's like that scene
[33:32] in Wolf of Wall Street, the
[33:34] It's a wuzzy, it's a woozy, it's
[33:37] fairy dust. It's all fake, it's all
[33:39] garbage, right? And so, you have stock
[33:41] market at all-time high, lot of these
[33:43] companies killing it by hiring robots
[33:45] and hiring artificial intelligence
[33:47] instead of humans, and then you have the
[33:49] majority of the population that's never
[33:51] been worse. Okay? So, first of all, gas
[33:54] continues to climb.
[33:55] This is the fastest spike since the
[33:57] Russia-Ukraine shock, and it's going to
[33:59] keep going. There's no signs of gas
[34:01] slowing down.
[34:04] Oil inventories are falling at a record
[34:06] pace. So, this tweet, "The world is
[34:08] burning through oil inventories at the
[34:10] fastest pace on record. Since the
[34:12] US-Israeli war began or war on Iran,
[34:15] excuse me, began, stockpiles have fallen
[34:17] by 4.8 million barrels per day. This
[34:21] exceeds peak COVID drawdown."
[34:24] Again, guys, like
[34:25] this is crazy. Once these inventories
[34:28] run dry, we will switch from an oil
[34:30] deficit to an oil shortage and prices
[34:33] will spike again. So,
[34:35] it's almost as if like the stock market
[34:38] doesn't appreciate
[34:40] the pending danger the world is it like
[34:42] the physical world like you cannot print
[34:44] oil, you cannot print energy. This These
[34:47] are physical realities that will soon
[34:50] impose themselves. But it it's almost as
[34:52] if what the stock market is saying is
[34:54] we don't really give a [ __ ] until
[34:56] there's a crisis because for now this is
[34:59] like some of the most booming growth.
[35:00] This is record deficit spending combined
[35:03] with record tech innovation. So, like
[35:06] wake me up when the world actually falls
[35:09] apart, but I'm tired of hearing about
[35:11] how the world is falling apart in the
[35:13] meantime. I guess. I mean, it's just a
[35:16] crazy time to be alive. Floating uh
[35:19] storage down 33%. So, crude oil floating
[35:21] storage falls 33% in the past week. In
[35:25] the past week. This is across Asia
[35:28] Pacific, the Middle East, West Africa,
[35:30] Europe, US Gulf Coast, and the North
[35:32] Sea. Like crazy. Now, back to how much
[35:36] pain Main Street is in.
[35:38] This is the US JOLTS job openings by
[35:41] industry. Look at the bottom,
[35:43] professional and business services.
[35:45] Who is in pain? Guys, look at that. That
[35:49] is crazy. That's for those listening,
[35:52] negative 300,000.
[35:55] Okay? And what is professional and
[35:57] business services? I'm talking
[35:59] management consulting, accounting and
[36:01] tax preparation, legal services,
[36:04] um
[36:06] computer systems, staffing and temp
[36:08] agencies.
[36:10] The This is the industry that's being
[36:13] very greatly impacted by AI.
[36:18] Nuts. This is This is nuts.
[36:22] Now,
[36:23] I speak in Prague in about a month at
[36:26] BTC Prague.
[36:28] And I think I'm going to do a keynote on
[36:30] I've talked about this idea before where
[36:32] I see Bitcoin
[36:34] and AI, the combination of the two,
[36:37] bringing about a new art renaissance
[36:40] because I've had this like thesis that
[36:43] I've been baking in my head for a really
[36:44] long time that
[36:51] How do I try and shorten this?
[36:54] Fiat
[36:56] created, you know, in this idea of
[36:58] globalism where the US, the Western
[37:01] world, we're not going to have a middle
[37:05] class, we're not going to have manual
[37:07] labor, we're not going to have
[37:10] um
[37:11] uh
[37:12] what what
[37:14] the blue-collar workers are now in
[37:16] China. I've I've given this rant a
[37:17] million times. Blue-collar is now in
[37:19] China, um our industrial capacity's
[37:22] gone, middle class gone, middle of
[37:23] America gone. And we flooded the coast.
[37:27] Uh the coast meaning you're doing this
[37:29] level of work. You're you're you're
[37:31] doing it The coast is Wall Street and
[37:33] Silicon Valley. And you're doing
[37:36] everyone now No one is working with
[37:38] their hands, no one's producing anything
[37:40] real. Um you're doing these, you know,
[37:42] business and professional services. This
[37:43] chart that I'm showing here, look at the
[37:46] amount of lawyers since 1971.
[37:51] Mind you, this is the problem with just
[37:54] printing money and doing nothing of
[37:56] real. Because you have highly competent
[37:59] people that are incentivized to be
[38:03] high-frequency traders or lawyers or
[38:06] accounting tax people as opposed to
[38:10] mining rare earths, as opposed to
[38:12] manufacturing, as as opposed to
[38:14] industrial cap like And so this is what
[38:16] happens. You get a a a boom in
[38:20] white-collar work.
[38:22] And you've hyper financialized
[38:24] everything. And I say the art
[38:26] renaissance because, you know, in my
[38:28] opinion, our our buildings and our
[38:31] architecture has gotten uglier. I I
[38:33] think we've lost the artistry in being
[38:36] human. At the end of the day,
[38:38] that that human touch will be the
[38:40] difference between us and AI. AI makes
[38:42] really ugly things. It has no touch. It
[38:45] has no taste. And that that is to me the
[38:48] human experience is the is the
[38:49] expression of art. And we've lost that
[38:53] with fiat. And instead, we have like a
[38:56] bunch of lawyers running around. And and
[39:00] it's and just I think that
[39:04] this post '71 dollar and fiat has met
[39:07] its match with Bitcoin and AI. And
[39:09] Bitcoin and AI can bring back an art
[39:11] renaissance because if you have money
[39:13] that can lower your time prefe- time
[39:14] preference and you're not in a rat race
[39:17] against debt, where you're not needing
[39:20] to take these white collar jobs that pay
[39:22] you just enough to pay down not pay down
[39:25] your college education, pay down your
[39:27] mortgage, pay down your car note, pay
[39:28] down your credit card. You're just in a
[39:30] rat race, a hamster wheel to outrun the
[39:33] debt. And so you're not pursuing
[39:35] artistic craft with a low time
[39:37] preference and an ability to breathe and
[39:39] think and create and be present. It's
[39:42] stress. It's rat race. It's investment
[39:45] banking 20-hour days, right?
[39:49] And so the the hard money gives us the
[39:52] luxury to lower our time preference and
[39:55] prioritize our future.
[39:56] And the artificial intelligence is so
[39:58] deflationary that it makes everything
[40:00] around us cheap and accessible. It's
[40:02] easy then to account for a spreadsheet,
[40:05] to write a legal document. The hard part
[40:07] is the artistry, is the creativity part.
[40:12] All of the mundane tasks are automated.
[40:15] All of the ability to save is accessible
[40:18] and what what is left is is to create
[40:22] artistry.
[40:24] That's I I'll I'm going to give a really
[40:26] cool speech in Prague. I've started
[40:28] working on it already. But anyway,
[40:30] seeing this labor K-shape professional
[40:33] and business services getting crushed. I
[40:35] mean, America by ways of policy. Like
[40:38] this was a policy decision. If you are
[40:42] in manual labor, if you're working with
[40:43] your hands, if you're producing real
[40:45] things, then
[40:47] you lost your job decades ago. You
[40:49] overdosed on opioids decades ago, right?
[40:52] That that that part that middle-class
[40:55] manual labor real working on real
[40:58] physical things, that was eviscerated
[41:00] from the United States. And you have
[41:02] this overproduction of elitism where in
[41:06] order to have a life worth living, you
[41:08] got to find a way you got to be a
[41:09] lawyer, you got to be an investment
[41:11] banker, you got to be in private equity,
[41:13] you got to be a venture capitalist, you
[41:14] got to be a founder of a tech startup.
[41:16] That Now every Now you're seeing the
[41:19] evisceration of white collar and these
[41:22] things meeting the automation of
[41:23] technology and we're now starting to
[41:25] realize how much of a shortage we've
[41:27] been in in art, in taste, in creativity
[41:30] and and and how
[41:32] overpopulated we are. This is what, you
[41:35] know, in the book The End Times he calls
[41:37] elite overproduction where you have a
[41:39] decline in real wages and
[41:42] overproduction of of people trying to be
[41:45] elite and there's just not enough room.
[41:47] So anyway,
[41:49] I'll give that talk later, but now I'm
[41:52] going to parlay this idea into some of
[41:55] the things that are worrying me. So,
[41:57] this is a visual. Let me try and zoom in
[41:59] here. So, the tweet reads, "Another way
[42:01] to express the chart below is the
[42:03] fertility rate peaked in 2007, which was
[42:06] almost 20 years ago. We still
[42:08] underestimate the extent of the damage
[42:10] done from 2007 to 2009, the financial
[42:13] crisis, the global financial crisis. So,
[42:15] US fertility rates are falling off a
[42:18] cliff.
[42:20] And the other thing to keep in mind,
[42:22] guys, is when you're in so much debt,
[42:25] what you've done is you've borrowed from
[42:26] your future.
[42:28] That's really like
[42:30] debt, especially by governments, is as
[42:32] close to time travel as I think we've
[42:35] ever gotten.
[42:36] And that that's a little bit of a
[42:38] philosophical mumbo jumbo, but
[42:40] I mean it pretty literally because what
[42:42] governments can do is they can borrow
[42:45] the time, energy, effort, and labor from
[42:47] future populations, right? Now, if I
[42:50] take on debt for myself in a personal
[42:52] capacity, like I want to borrow against
[42:54] my Bitcoin, I am borrowing against
[42:57] either my future productivity or my
[42:59] Bitcoin's future performance. So, I
[43:02] myself am borrowing from my own future.
[43:05] And that's all debt is. It's your
[43:06] pulling forward future growth and future
[43:09] earnings to spend now. And it's a good
[43:12] idea if your future has the capacity to
[43:15] be far better than the past, and you can
[43:17] enter your future in a far better state
[43:19] than than if you didn't take on the debt
[43:21] in the first place, right? Does that
[43:23] make sense? So, that's that's all
[43:25] conceptually like taking on debt is. But
[43:28] if a government takes on debt,
[43:30] they are
[43:32] they're I mean, especially modern-day
[43:34] governments and central banking and
[43:36] fiat, they are not borrowing they are
[43:38] borrowing from all of our our kids and
[43:42] our future human time, energy, effort,
[43:44] and labor. So, it's like time travel.
[43:46] Like the kids that I haven't even
[43:49] produced yet, the government has already
[43:51] spent their effort.
[43:55] Now, I give you all of that context to
[43:58] say, in order for the government to make
[44:01] whole on the debt they've created, they
[44:04] need growth.
[44:06] Right? It'd be the equivalent of
[44:07] borrowing against your Bitcoin and
[44:08] Bitcoin just goes down forever. Or
[44:10] borrowing against your Bitcoin and you
[44:12] get fired from your job. That would be
[44:14] bad, right? That would not be good,
[44:16] okay?
[44:18] It's the same It's the same thing where
[44:21] if the US stops having kids and
[44:24] fertility rates are dropping through the
[44:25] roof, you can't print 18-year-olds. It
[44:28] takes 18 years to make an 18-year-old.
[44:31] It doesn't matter what fancy level of QE
[44:35] you're doing.
[44:37] You are 18 years away at minimum from
[44:39] having another 18-year-old in the
[44:41] economy. And so, if fertility rates are
[44:43] falling off a cliff,
[44:45] then it's impossible for the US to
[44:48] realize the debt that it's taken out
[44:50] because it physically cannot have the
[44:52] growth required.
[44:54] In fact,
[44:55] one of the reasons the United States is
[44:58] leaning probably so much into AI and
[45:00] robotics is because so much of the
[45:02] growth is going to have to be robots cuz
[45:04] we're not going to have enough humans to
[45:06] climb out of this pile of debt.
[45:12] I mean, the the chart below, America's
[45:14] at peak 18. The number of 18-year-olds
[45:17] will fall 14% over the coming decade.
[45:21] People just aren't This is the problem
[45:23] when
[45:24] the the fix the money fix the world, the
[45:26] opposite is true. Break the money, break
[45:28] the world.
[45:30] Functioning money is a functioning
[45:32] society. It is the market good that
[45:35] represents our human dignity, our time,
[45:38] our energy, our effort, our labor. It's
[45:40] in It's the greatest form of information
[45:42] transfer for us humans. It's how we
[45:44] coordinate and collaborate with each
[45:46] other. If you [ __ ] with that, you
[45:49] destroy society.
[45:52] Either And And I'll tell you guys I'll
[45:54] I'll save you the research on why the
[45:56] fertility rate's dropping and population
[45:58] is down. More or less, here's the
[45:59] problem.
[46:01] One, when you have such globalism and
[46:03] everything's hyper financialized,
[46:05] corporations uh seek higher margins. So,
[46:08] if I'm McDonald's, I'd rather really
[46:10] nasty canola oil that's probably
[46:12] contributing to metabolic metabolic
[46:13] disease, obesity,
[46:15] um
[46:16] cancer rates.
[46:18] People are like the food and the quality
[46:21] of ingredients is making Americans sick
[46:23] because number go up with the stock.
[46:27] Number go up, margins go up, sick go up.
[46:30] So, for one, like actual fertility is
[46:33] bad because we're consuming way too much
[46:36] pharmaceuticals. We're everyone's
[46:37] swallowing all of these man-made pills.
[46:40] We're not eating organic fresh
[46:41] ingredients. People like the hyper
[46:43] financialization and globalism is that
[46:46] asset prices must go up for the Ponzi to
[46:49] continue. And so, everyone's getting
[46:51] sick to the benefit of your corporate
[46:54] margins and corporate equities. So,
[46:56] that's one. And then more just societal
[47:00] trends is people are either too wealthy
[47:02] to want to have kids or they're not
[47:05] wealthy enough to be able to afford to
[47:06] have kids.
[47:10] The K-shaped economy is realized in that
[47:12] like
[47:14] how do I say? For for the person that
[47:16] has $10 billion that is like wealthier
[47:19] than like
[47:21] 10% of the bottom combined, they're not
[47:23] making up for it in that they're not
[47:25] having like
[47:26] 1,000 times the kids, right? In fact,
[47:29] they're having like maybe one or two
[47:31] kids cuz they're spending their time
[47:32] jetting around the world, uh buying
[47:34] professional sports teams, hanging out
[47:35] in Las Vegas, whatever, right? Like
[47:37] they're not having 100 kids, 200 kids to
[47:41] make up for the fact that, you know, the
[47:42] bottom percentile of the economy of Main
[47:45] Street can't afford to have one.
[47:47] Can't even afford a house. Can't afford
[47:49] a credit card.
[47:55] I mean, the the these things concern me.
[47:58] So, I mean, last week we had a lot of
[48:00] really important earnings. Cloudflare
[48:03] lay off 20% of its employees. Upwork lay
[48:05] off 25% of its employees. Bill Holdings
[48:08] lay off 30% of its employees.
[48:11] It's I mean, guys, this is what you get
[48:14] with fiat.
[48:16] You want a hyper financialized
[48:18] globalism? This is what you get.
[48:20] Everyone's going to optimize for
[48:21] margins, optimize for stock go up, and
[48:24] I'll get into it in my grind my gears
[48:26] segment, but
[48:27] this is a recipe for disaster in
[48:30] society. You are You are quite literally
[48:33] dividing society into two camps. It's
[48:35] dangerous. It's disgusting. It's
[48:38] unethical. It's immoral. It's scary.
[48:41] And
[48:42] I mean, the the other thing I actually
[48:44] had the shower thought this morning, you
[48:46] know, um cuz
[48:50] So, I am
[48:52] read a lot of these macro researchers
[48:54] and these like fiat analysts and stuff.
[48:56] And this is what I just enjoy trying to
[48:58] make sense of the world and understand I
[49:01] also love history, understand our place
[49:04] in history, and
[49:05] all that stuff. And uh
[49:08] I was thinking, you know, cuz a lot of
[49:10] these fiat guys, maybe they're not into
[49:11] Bitcoin yet or,
[49:14] you know, they're more interested in
[49:15] picking the right stocks at the right
[49:17] time and all this [ __ ]
[49:19] But I had this almost
[49:20] overwhelming
[49:22] sense of purpose in working on Bitcoin
[49:24] because we're working on something new.
[49:29] I think that I think that's just That
[49:31] alone
[49:33] is such a powerful idea.
[49:37] We're not working on this old system
[49:41] that's clearly broken, that's clearly
[49:44] been the reason for so much of the worst
[49:47] of humanity and the worst of our lived
[49:49] experiences and the pain for our
[49:50] families and the pain for our neighbors,
[49:53] in the in the cause of war, in the cause
[49:56] of human death.
[49:59] We're a group of people that are saying,
[50:02] "We need something new. We need
[50:04] something better."
[50:06] And we're going to from from scratch,
[50:08] literally from scratch,
[50:11] from a white paper
[50:13] dropped in a mailing list,
[50:16] we're going to build something else.
[50:18] That alone is so cool to me.
[50:22] Because I don't know how else to explain
[50:24] like all of what we're witnessing is the
[50:26] result of policy decisions. If you want
[50:29] to forego producing real things, print
[50:32] money out of thin air,
[50:34] import all the stuff you actually use,
[50:37] and export printed currency, this is
[50:39] what you get. Hyper-financialization,
[50:42] hyper-globalism.
[50:43] You get companies that are just opt that
[50:48] that have to they have to. They have to
[50:51] optimize for margins in the highest
[50:53] stock price.
[50:55] You get this K-shaped economy,
[50:57] evisceration of the middle class. You've
[50:59] got You get the lowest consumer
[51:00] sentiment ever. Depression, drug
[51:03] overdose, metabolic disease, obesity.
[51:06] You get a sick population, a dying pop
[51:08] population, a population that isn't
[51:10] fertile, a population that can't have
[51:12] kids.
[51:13] The only hope we have of climbing out of
[51:16] this hellhole is debasing our currency
[51:19] and replacing ourselves with robots, cuz
[51:21] there's not enough of us.
[51:26] And it just
[51:27] to me, it's the coolest thing.
[51:30] Like I'm getting out of the shower this
[51:31] morning like, "I'm strapping up to go to
[51:34] work on something new."
[51:36] Building the new thing, new system. When
[51:39] [ __ ] cuz this thing isn't working. It's
[51:41] just I just think that's really cool.
[51:44] I mean, it's it's an oversimplified,
[51:47] you know,
[51:48] you you're you're listening to this,
[51:49] you're probably like duh, yeah,
[51:50] Bitcoin's the new financial system we're
[51:52] working on. But I don't know, it hit me
[51:54] in a in a in a big way this morning. It
[51:56] was like you know, we're we are the ones
[51:59] building the new thing.
[52:01] Like and and you got all these
[52:03] economists and stock pickers and macro
[52:05] this and that and
[52:08] it's I don't know. It is I think this is
[52:11] the heroes the heroes journey of the
[52:13] younger generation is we're going to
[52:15] we're going to just build the new thing
[52:17] from scratch.
[52:18] So anyway, to continue my rant and get
[52:21] myself to ground my gears here. The
[52:24] 30-year yield is back over 5%.
[52:27] I mean
[52:28] the bond market's screaming.
[52:30] The bond market is absolutely screaming.
[52:33] So the escape valve, where does Bitcoin
[52:35] fit? I found this from Luke really
[52:37] fascinating. So he charted the inverse
[52:41] of the move index, which is the bond
[52:43] volatility index, the Vix,
[52:46] and Bitcoin. And you can see Bitcoin,
[52:49] which is in green,
[52:50] reacted to the sharp reversal of the
[52:54] move in the Vix.
[52:57] And that's really fascinating. Bitcoin
[52:59] seems to be implying
[53:01] that there is very serious liquidity
[53:04] that is protecting markets and
[53:07] protecting volatility from screaming
[53:09] upwards.
[53:10] And Bitcoin seems to be It's that whole
[53:13] Bitcoin is a liquidity smoke alarm. The
[53:16] smoke alarm's going off.
[53:18] And and I've kind of been alluding to
[53:20] this over the last few episodes. Bitcoin
[53:21] at 82,000 with the Strait of Hormuz
[53:23] being closed and volatility the Vix was
[53:26] hanging out at 30 two three weeks ago or
[53:29] whatever that was and and now it's at at
[53:31] 15 17.
[53:33] The The smoke alarm's going off.
[53:34] Liquidity cometh.
[53:36] They're running it super super super
[53:38] hot. And this is a visual expression of
[53:42] that in a chart. And then the other here
[53:45] from Frank, he posts really good Bitcoin
[53:48] charts. This is the choppiness index and
[53:51] really what this is saying is you can
[53:53] think of the Bitcoin market like a
[53:55] coiled spring. Like it chops around and
[53:58] it and it gets range inbound and
[54:01] whenever the choppiness index drops,
[54:03] means that the spring is uncoiled and
[54:05] it's ready for absolute rip your face
[54:07] lift off, then Bitcoin goes on a new
[54:11] face ripping price discovery trend. And
[54:14] that looks like there's a chance for
[54:16] that. Again, this is another chart which
[54:18] arrives at the same
[54:20] implication as what we've been saying
[54:22] and what Luke is saying, which is
[54:24] liquidity is coming and Bitcoin seems to
[54:26] be smelling it and the choppiness index
[54:29] seems to be falling. And so the chart is
[54:32] highlighting where things look similar
[54:35] when Bitcoin was at 13k and it and it
[54:37] then went on and exploded to 70k.
[54:41] Similarly when Bitcoin was at 30k and it
[54:43] went on to go to 126k.
[54:45] Now it's at 80k and we're seeing the
[54:47] similar signs and you know, what we
[54:49] could have witnessed in the run-up to
[54:51] 126k was a bit of a fakeish bull market.
[54:54] We were still in QT.
[54:57] Interesting. So no matter how you slice
[55:00] it. Now we might get a financial crisis
[55:03] and a serious disaster due to the Strait
[55:05] of Hormuz being closed and and the
[55:07] global supply chains being so screwed up
[55:10] because of the conflict in Iran. That
[55:11] might happen and Bitcoin might fall to
[55:13] 60k. Everyone should be prepared for
[55:15] that. Stay humble, stack sats, earn more
[55:17] than you're spending, stay healthy, be
[55:19] with family, do not add reckless
[55:22] leverage, do not try and task yourself
[55:24] with predicting the future. It's it's a
[55:26] pointless job. It's a soulless job. Um
[55:29] stay humble, lower your time preference,
[55:31] stack those sats, turn on those DCAs.
[55:33] Either way you win. But it seems to be
[55:35] that liquidity is coming no matter how
[55:37] you slice it. If we make a pit stop
[55:39] lower and then go higher or we just
[55:41] scream higher, it looks like the world
[55:43] is unfolding exactly how us Bitcoiners
[55:45] thought. And I just find a lot of pride
[55:48] in the fact that we're the group that's
[55:50] building the new thing.
[55:52] It's cool. It's cool. So, tale of two
[55:55] wolves, I found that framing
[55:57] interesting. It really is quite the
[55:58] contrast where you've got 20% of the
[56:01] world's oil completely offline while the
[56:05] stock market and mag seven are like
[56:06] breaking records for productivity
[56:08] because artificial intelligence is like
[56:10] doing the job of humans. Crazy. So
[56:13] crazy. I mean, I feel like I downloaded
[56:14] chat GPT yesterday.
[56:16] Didn't it feel like yesterday?
[56:18] I mean, I know it's been around for like
[56:19] 3 years or at least for me using it, but
[56:22] like holy moly.
[56:24] Um humans are I again, you can be doom
[56:27] and gloom if you want. You got every
[56:28] excuse. But whenever you're you know, my
[56:30] dad once told me
[56:32] way back in the day,
[56:34] um I was having difficulties with a girl
[56:36] in high school, like every other um high
[56:38] school teenage dude. And I was crying to
[56:40] my dad.
[56:42] And he kind of had this expression on
[56:43] his face like he was over it. And I
[56:46] would you know, I was looking at him
[56:47] like, "Come on, man. I'm sad." And and
[56:49] his point was, "You can be sad. I'm not
[56:51] telling you not to be sad. Go ahead,
[56:53] cry. But when you're done, let's get to
[56:55] work."
[56:56] You know what I mean?
[56:58] And it was I'll never forget that. Cuz
[57:00] it was like, "Yeah, you know, be sad."
[57:01] Again, emotions are helpful. They're
[57:03] useful. Um they they're information for
[57:06] for you for your mind, for your body.
[57:08] You know, being happy is useful
[57:09] information. Being sad is useful
[57:10] information. You didn't like that.
[57:11] You're sad. Go ahead, cry about it. But
[57:13] then, you know, you don't make progress
[57:15] crying.
[57:17] We don't we can't get anything done
[57:18] crying. So, when you're done crying, let
[57:20] me know. Let's get to work. You know
[57:22] what I mean? And that's kind of how I
[57:23] feel. You could be doom and gloom. No
[57:25] problem. Do whatever you want.
[57:27] But when you're done crying, let's go
[57:29] change the world. What do you guys say?
[57:31] Right? Let's go build a new monetary
[57:33] system.
[57:34] Let's go educate people.
[57:36] Let's go do better for our generation
[57:38] than those before us,
[57:40] right? I don't know, it's just take it I
[57:42] had a lot of energy this morning like,
[57:44] let's [ __ ] go. We got AI, we got
[57:46] Bitcoin, we're living through the
[57:48] demonetization of fiat and bonds and the
[57:51] remonetization of hard money. Like we we
[57:54] are right in the thick of it. I feel
[57:56] blessed.
[57:58] Okay.
[57:59] With that being said, let me take a sip
[58:01] of some liquid and uh let's do Grind My
[58:04] Gears.
[58:07] The chat is asking me if I shower in the
[58:09] morning. I do.
[58:11] Can't believe that's a question.
[58:13] I have the weirdest chat.
[58:16] Do I shower?
[58:18] What type of question is that?
[58:22] What the hell, man?
[58:25] Okay.
[58:28] Let's uh
[58:29] let's do Grind My Gears. Uh
[58:31] this week on Grind My Gears,
[58:33] I got AOC and these politicians and and
[58:35] I'll parlay this into some of the topics
[58:38] I was talking about on the episode.
[58:39] First, let's listen to uh to this video.
[58:42] Let me click in and play it for you
[58:43] guys. Certain level
[58:48] >> There's a certain level of wealth
[58:51] and accumulation that is unearned,
[58:55] right?
[58:56] >> [laughter]
[58:56] >> You [snorts] can't earn
[58:59] a billion dollars.
[59:00] >> That's right.
[59:01] >> You just can't earn that.
[59:04] >> correct.
[59:04] >> You can you can get market power, you
[59:08] can
[59:10] break rules, you can do all sorts of
[59:12] things. You can abuse labor laws, you
[59:15] can pay people less than what they're
[59:17] worth, but you can't earn that, right?
[59:19] And so
[59:21] you have to create a myth
[59:25] that
[59:26] since you didn't earn that, you have to
[59:28] create a myth of earning it. There's a
[59:30] certain level
[59:33] >> [sighs]
[59:33] >> I mean, what
[59:35] what are these people talking about? So,
[59:38] I'll read back her quote. There's a
[59:40] certain level of wealth and accumulation
[59:42] that is unearned. You can't earn a
[59:45] billion dollars. You just can't earn
[59:47] that. You can get market power, you can
[59:50] break rules, you can abuse labor laws,
[59:53] you can pay people less than what
[59:55] they're worth, but you can't earn that.
[59:59] This is the problem. This is the
[60:01] societal
[60:03] split and stress caused by fiat is that
[60:07] there's a growing class of people that
[60:09] are getting angry at our most productive
[60:13] humans. Guys, I'm going to go on the
[60:15] same rant I always do because it is so
[60:18] important.
[60:19] If money is a reflection of your time,
[60:23] your energy, your effort, and your
[60:24] labor, the value that you are
[60:27] contributing to those around you. Money
[60:29] is what you get in return for the value
[60:32] you are contributing. Do you want to
[60:34] know how valuable you are to the world?
[60:36] Look at how much you're getting paid for
[60:38] the work you are doing.
[60:41] In theory, in a perfect world, and the
[60:43] world's not perfect, but the point
[60:45] remains.
[60:46] The amount of money you have is a
[60:47] reflection of your contributions to
[60:49] society.
[60:54] Someone that makes a billion dollars a
[60:56] year is extremely productive.
[61:00] And I've given this speech before. You
[61:03] Like, I do not think you want to abuse
[61:06] and tax and and rip the property out of
[61:09] those people's hands. They are your
[61:10] greatest producers. Someone like Elon
[61:12] Musk is a great producer to society.
[61:16] One of the greatest producers we've ever
[61:18] seen.
[61:20] But because of the K-shaped economy,
[61:22] because of the evisceration of the
[61:24] middle class, because of fiat and
[61:26] monetary policy, you now have a group of
[61:29] society that is that it is not
[61:33] acceptable to be wealthy. But being
[61:35] wealthy has such a negative connotation.
[61:38] It's not acceptable to be productive.
[61:41] It's ridiculous. So on this
[61:44] uh
[61:44] slide here, Paul Graham responds to this
[61:47] atrocity from AOC. He says, "Sure you
[61:50] can earn a billion dollars. I've been
[61:51] teaching people how to do it for 20
[61:53] years. The way you do it is you start a
[61:54] company that grows fast. You don't have
[61:56] to do anything bad to make a company
[61:58] grow fast. You just have to make
[62:00] something that people want." Again,
[62:02] people overcomplicate this. It's not
[62:04] that complicated. You do productive
[62:07] things for people. If you want to make a
[62:09] billion dollars, you have to very
[62:11] scalably do a productive thing. And the
[62:14] easiest way to make a billion dollars is
[62:16] to do a productive thing via technology
[62:18] because technology can scale to billions
[62:20] of people.
[62:22] It's much harder to do
[62:24] a a really valuable thing worth $1
[62:27] billion to one dude versus doing a
[62:30] valuable thing worth a dollar to a
[62:31] billion people with technology. But the
[62:33] point is how productive are you to
[62:36] people, to your customers, to your user
[62:38] base, to your clients, whatever the case
[62:40] is. It's super simple. And if someone
[62:43] says that you're you can't possibly be
[62:46] that productive, what does that say
[62:48] about their outlook on society? I mean,
[62:50] honestly, at this point, like someone
[62:51] like AOC, like it's mental illness. It's
[62:54] ridiculous. But she goes on to write and
[62:57] she says, "Someone can certainly make a
[62:59] billion dollars, but that's not the same
[63:01] thing as earning. Growing fast and
[63:03] disrupting markets also often means
[63:05] chasing and wielding market power,
[63:07] political influence, and scale." She
[63:09] goes on to say that Airbnb is only a
[63:11] valuable company because of political
[63:13] influence and not because of net
[63:14] productivity.
[63:17] It's Now,
[63:19] I'm
[63:21] going to rein myself in here
[63:24] and uh
[63:27] we're not going to go on a cursing
[63:29] montage this week because
[63:31] here this is a little bit more somber
[63:33] grinding my gears. This really concerns
[63:36] me.
[63:37] I get worried about this.
[63:40] Because this is the root cause of a lot
[63:43] of the violence, a lot of the political
[63:45] violence.
[63:47] This is where you get, you know, people
[63:49] that are taking out weapons.
[63:51] This is where you get a violation of
[63:53] property rights.
[63:55] Okay, I get really concerned
[63:58] over, you know, the assassination
[64:01] attempts on executives at companies. I
[64:04] get really concerned at demonizing
[64:08] uh the upper class and blaming all of
[64:11] the societal issues on them.
[64:15] Um I get really concerned as to I mean,
[64:17] the UK is losing like more millionaires
[64:21] than any other country. It's ridiculous.
[64:23] People are fleeing the West because
[64:26] people that are productive aren't
[64:29] feel like they're not being
[64:32] respected and treated well and or their
[64:34] lives are in danger. And I mean, who
[64:37] knows who's going to run for president
[64:39] and and what the next election is going
[64:40] to look like, but I mean, I think it's
[64:42] reasonable to assume that you're going
[64:44] to get a political party that points the
[64:47] finger at a specific cohort of society
[64:52] and basically incites violence on them.
[64:57] And it's crazy because all of us
[64:59] listening, we know the reason. It's
[65:02] money printing, it's because the money's
[65:04] broken, it's monetary policy, it's
[65:07] government policy. All of this is the
[65:09] cause of of a rupturing society. Fix the
[65:12] money, fix the world. Break the money,
[65:13] break the world. It's just true and
[65:16] it this really does concern me because
[65:19] people are talking about how AOC might
[65:21] be a candidate for the next president of
[65:23] the United States and I mean
[65:26] what we saw with the the mayor Mondani,
[65:28] the mayor of New York and Ken Griffin.
[65:31] The guy's out in front of someone else's
[65:33] property making a mockery
[65:36] um of their property rights.
[65:38] It's like the guy is clearly a net
[65:42] productive to the world and he creates a
[65:46] lot of jobs and like I just I'm a a free
[65:49] market property rights guy. You're
[65:52] standing outside of someone else's
[65:54] property making a mockery of it,
[65:56] undermining his right to property and
[65:58] his right to be a productive person
[66:00] saying, "Your productivity is ours to
[66:02] own. Your property is ours to own." It's
[66:05] crazy. It's crazy and then
[66:08] it's just uh to me it's terrifying
[66:10] because we've already seen violence uh
[66:14] as a result of this. And if you're going
[66:17] to continue to demonize our most
[66:21] productive people
[66:22] that's really really really really
[66:24] dangerous for society. We want people to
[66:28] strive to be productive. Like being a
[66:30] profitable company is not a bad thing.
[66:33] Being a profitable person is not a bad
[66:35] thing.
[66:36] But being wealthy is. Like the the
[66:39] negative connotations and the demonizing
[66:41] of this. I urge all of you guys
[66:44] if you want to grow your wealth, there
[66:45] are two ways to do so. In fact, I
[66:48] encourage to do both at the same time.
[66:50] One is spend less, consume less from the
[66:53] world. Okay? Reduce your annual or your
[66:57] monthly or your weekly spend for your
[67:00] lifestyle. And the other is be more
[67:02] productive, which is make more money.
[67:04] Find a way to be more productive for
[67:06] those around you and find a way to
[67:07] consume less from the world. Need less
[67:10] for your lifestyle and earn more through
[67:12] being productive. That's the only way to
[67:15] grow wealth
[67:16] from the highest philosophical level.
[67:19] And the fact that
[67:21] you know, people that want to run for
[67:22] president are saying that makes you a
[67:23] bad person, that makes you the devil,
[67:25] that makes you a demon, you're the cause
[67:27] of society's issues.
[67:29] Like then what are we encouraging our
[67:31] children and and society to become?
[67:34] For saying if you earn property, you you
[67:37] know, people are going to try and kill
[67:38] you, shoot you, stand outside of your
[67:40] house and violate your right to your
[67:43] property, to your productivity.
[67:45] And I've already made the point as well,
[67:47] like if it were up to me, Ken Griffin
[67:50] would spend his own money and not be
[67:52] taxed on how to fix the roads, on how to
[67:54] build better subways, on how to finance
[67:56] Medicare, whatever pe- people needing
[67:58] medical attention. Like that cuz he's a
[68:01] productive person who seems to know how
[68:03] to problem solve at scale and prioritize
[68:06] and execute. Government has proven to do
[68:08] the opposite. Government is the least
[68:10] productive thing we've ever seen. The US
[68:13] government loses $2 trillion
[68:15] a year. That's the net deficit a year.
[68:17] It's crazy.
[68:19] So the fact that we're even taxing
[68:21] people to the level that we are is
[68:24] already enough. Let the most productive
[68:26] people be productive with their
[68:28] productivity. What are we doing? On top
[68:31] of that, you have politicians and
[68:32] governments basically inciting violence
[68:34] on these people, telling society don't
[68:37] you dare be productive, being productive
[68:38] is wrong, it's not possible, you're a
[68:41] bad person if you're productive. It's
[68:43] crazy. Another way of saying what AOC is
[68:46] saying is like don't be too profitable.
[68:48] Don't earn too much more than you spend.
[68:51] You have no right to property. Any
[68:53] property that ends up being more
[68:56] valuable than normal should be ours.
[68:59] [ __ ] you. What the [ __ ]
[69:02] So another reason Bitcoin's going to
[69:04] explode in popularity is like
[69:06] I'll tell you what, Mumtaz couldn't
[69:08] couldn't have stood out of sight of Ken
[69:10] Griffin's private keys and made a
[69:11] mockery of them.
[69:13] Ken Griffin can own as much Bitcoin as
[69:15] you want. Mumtaz has doesn't have a say
[69:18] or choice.
[69:20] That's real privacy, real property
[69:22] rights.
[69:25] That's why I love it. I love it. Bitcoin
[69:28] is
[69:29] the most fundamental form of property
[69:31] rights we've ever seen. I've made this
[69:34] point before, but
[69:36] if I have a pile of gold,
[69:39] a pile of real estate, and a pile of
[69:41] Bitcoins, if you want to steal my gold,
[69:44] you can put a gun to my head and put a
[69:46] bullet in my brain and pick up the pile
[69:48] of gold and take it. You want to steal
[69:50] my real estate, you can put a gun to my
[69:52] head, put a bullet in my brain, and take
[69:54] the keys to my property, and steal the
[69:57] real estate. You want my Bitcoin? The
[70:00] only way to guarantee you can't get it
[70:04] is by killing me.
[70:06] Because I got 12 words in my head.
[70:09] In fact, the only way
[70:11] to get my Bitcoin is you got to keep me
[70:13] alive.
[70:15] Think about the level of property
[70:17] rights.
[70:23] So, I'm just really worried about
[70:27] the
[70:28] societal infighting and I I've mentioned
[70:31] the stat assassination attempts are
[70:33] second only to the mid-1800s
[70:36] right now in the US. And obviously, the
[70:38] mid-1800s was the Civil War, so
[70:40] really concerning. It's all because the
[70:43] money's broken.
[70:44] And um
[70:47] yeah, scary scary stuff. Um
[70:50] and you heard it here first. Uh don't
[70:52] listen to this, especially the youth out
[70:54] there. Be productive, earn more than you
[70:56] spend. don't be afraid of saving wealth,
[70:59] of accumulating wealth, of stacking
[71:00] property,
[71:02] um lowering your time preference,
[71:03] prioritizing your future.
[71:06] Um the path to prosperity is not
[71:09] um elected officials uh stealing
[71:12] productivity from your neighbor and and
[71:15] reallocating it based on votes.
[71:23] Okay.
[71:24] Uh Strike updates.
[71:26] This was the what we shipped uh last
[71:29] week. Um
[71:31] we allow you to hide your balances uh
[71:34] for those that are using Strike and have
[71:37] a balance or information in the app that
[71:39] they don't want others to see, you can
[71:41] hide the balance by shaking the phone.
[71:43] Uh customers wanted us to also enable
[71:45] long press hiding, so we did. We have
[71:47] new designs, new animations for when you
[71:49] buy Bitcoin. We've also improved the
[71:52] lending experience for our customers uh
[71:55] when they go open and originate loans,
[71:57] different ways to set your lending
[71:59] amounts and other related experiences.
[72:02] As a reminder,
[72:04] we have uh rolling out segregated
[72:06] collateral,
[72:08] um
[72:09] uh no liquidation uh loan so that you
[72:11] can pay an upfront fee and uh remove the
[72:14] ability to get liquidated. We lowered
[72:16] our lending rates. We had a first
[72:17] lending proof of reserves, a $2.1
[72:19] billion lending facility from Tether.
[72:22] Strike is a monster. It keeps shipping.
[72:24] I'm really soon I hope to be able to
[72:26] share with you guys our first iteration
[72:28] of interest on cash, which is
[72:29] incredibly, incredibly, incredibly
[72:31] exciting. We have so much uh coming from
[72:34] Strike. You know, we pride ourselves on
[72:37] being one of the highest velocity,
[72:39] fastest shipping Bitcoin companies in
[72:41] the world. It's an incredible team. I
[72:43] have incredible colleagues, incredible
[72:45] culture. We're so focused and so
[72:47] mission-aligned, and we just churn out
[72:50] work nonstop. And um I mean, as a
[72:52] customer of Strike, it's just a joy
[72:55] because every single week multiple
[72:57] things shipped that we all ask for. So,
[73:00] keep the future requests coming. We keep
[73:02] building. We keep getting stronger as a
[73:04] company and the future is so bright.
[73:06] Like I said, I was just felt honored
[73:08] today to be able to be working on the
[73:10] new monetary system and
[73:13] just really proud of Strike and really
[73:15] proud of the opportunity that we have.
[73:16] So, thank you guys for being customers
[73:18] and again, if you want to support me
[73:20] ever,
[73:21] I'm not I'm not going to charge ads or
[73:23] I'm not going to add read on here.
[73:25] If you want to support me or you want to
[73:27] see how I pay my bills,
[73:29] download Strike. I think it's
[73:31] I think we're the only Bitcoin company
[73:32] now that isn't one-dimensional. Like,
[73:35] you know, you got Bitcoin companies that
[73:37] focus on buy sell Bitcoin or Bitcoin
[73:39] companies that focus on lending. In
[73:41] Strike, we're now getting into we have
[73:43] lending, we have brokerage, I'm thinking
[73:45] about custody products, thinking about
[73:46] yield products. We really want to be the
[73:49] Bitcoin global bank and financial
[73:51] services provider for for Bitcoiners and
[73:54] it's really coming along nicely.
[73:57] Uh 21, uh
[73:59] there's not
[74:00] much I wouldn't expect weekly updates
[74:03] with much detail. Again, public company,
[74:06] only so much I can say, but Tether's
[74:08] proposal now lives up on the internet,
[74:10] my keynote at the Bitcoin conference.
[74:12] So, I think it's safe to assume that
[74:15] there's work being done on pursuing
[74:16] these opportunities and again, we want
[74:18] to be
[74:19] what I would consider fairly unique
[74:21] company in that
[74:23] we want to have both operating income
[74:26] and and growth as an operating business
[74:28] and a focus on Bitcoin treasury. To me,
[74:30] that's the dream Bitcoin company, have
[74:32] both cash flow and
[74:34] Bitcoin growing Bitcoin treasury. Being
[74:36] able to finance, you know, any leverage
[74:39] or debt with cash flow, stack Bitcoin
[74:42] from cash flow,
[74:43] and make sure that our world view is
[74:45] expressed with our money, not just our
[74:47] mouth and our words, which is Bitcoin on
[74:48] the balance sheet. So,
[74:50] continue to pursue that. Very exciting.
[74:52] I'm happy to answer any questions, but
[74:54] like I said, the level of detail and
[74:56] updates Strike gives, I would not accept
[74:58] expect that from 21 just yet.
[75:03] Um okay.
[75:04] With that, let me uh blow up my camera
[75:07] here.
[75:08] Let's get into uh
[75:13] Let's get into some Q&A with Phil.
[75:17] Let's see.
[75:24] Okay. You guys ready?
[75:28] Let's see. First question.
[75:30] Jack, what are your thoughts on AI
[75:32] pricing services in watts? Someone in my
[75:34] Bitcoin meetup said he thinks AI will be
[75:36] priced in watts. Thoughts?
[75:39] Um
[75:40] it's possible.
[75:42] You know, maybe more realistic is that
[75:44] Bitcoin is priced in
[75:47] sats. I mean, excuse me, not Bitcoin. AI
[75:49] is priced in sats. Um but generally,
[75:52] your idea is uh
[75:54] you know, denominating things in energy
[75:56] terms as opposed to fiat, which makes
[75:58] sense. As I I said last episode,
[76:01] um
[76:03] everything that we experience is a
[76:04] derivative of energy. And fiat is not
[76:07] energy money. It's the opposite. You can
[76:09] print it out of thin air. And so,
[76:11] there's such a divorce from reality
[76:13] between, you know, the physical world.
[76:15] And you know, the story of humanity is
[76:17] commercializing energy from the sun.
[76:18] It's this big thing in the sky that
[76:20] beams energy down on us, and our ability
[76:22] to commercialize that
[76:24] uh into ways that make our lives better
[76:26] has really been our story. The
[76:28] combination of commercializing energy
[76:30] and and uh engineering a better world is
[76:33] the story of humanity. And uh so, I I I
[76:37] agree that energy money is what's
[76:39] needed, and it wouldn't surprise me if
[76:41] AI was priced in some energy derivative,
[76:44] but I think the better energy derivative
[76:47] for monetary purposes is probably
[76:48] Bitcoin.
[76:50] Um but who knows? I don't know. I'm not
[76:52] going to sit here and pretend like I'm
[76:54] an AI expert. Um I don't know. I'm
[76:56] figuring out Claude like everybody else.
[76:59] Uh question for Dylan. Can you ask Jack
[77:01] his thoughts on tax the rich and if that
[77:03] would actually solve our problems?
[77:06] I feel like I answered that one. It
[77:08] definitely would not solve our problems.
[77:10] Our problems are not um
[77:13] taking other people's property and
[77:16] dividend them out uh to the public. In
[77:19] fact, I think that what would go further
[77:22] in solving our problems is having no tax
[77:25] whatsoever.
[77:26] If someone is extremely productive as a
[77:28] person, you want them to be allocating
[77:31] capital. I'll give you guys How about
[77:33] this? Let me give you an analogy. Would
[77:35] you rather give your money to Ray Dalio
[77:38] or Ken Griffin or Warren Buffett to
[77:40] invest or would you rather give it to uh
[77:44] Congress in the US government? Who would
[77:46] you rather invest your money for a
[77:48] return?
[77:51] Probably the first guys that have made
[77:53] billions of dollars and built some of
[77:55] the most successful funds in the world.
[77:57] They're better at capital allocating.
[77:59] They're better at problem solving. So, I
[78:02] don't know why then all of a sudden if
[78:04] they're making billions of dollars a
[78:06] year, we don't just let them make the
[78:08] roads better, them make the the subway
[78:11] better, them make the airports better,
[78:13] them design a way to scale medical for
[78:15] everybody. Let the private sector do it
[78:18] because they're the most productive
[78:20] people. Why all of a sudden we give we
[78:23] we take property from the productive
[78:26] people and we give it to the most
[78:27] unproductive cohort in human history.
[78:29] Why does that make any sense? And people
[78:31] say, "Well, you know, if Warren Buffett
[78:33] didn't have to pay taxes, he wouldn't
[78:35] care to fix the roads." Is about the
[78:37] dumbest thing I've ever heard.
[78:39] Like, you think that highly productive
[78:41] people want to live with shitty roads, a
[78:44] shitty airport, shitty transportation,
[78:47] they want to sit in traffic all day?
[78:50] Like, it blows my it reminds me of when
[78:53] central banks say, "The only reason
[78:55] people want to spend money is when we
[78:56] cut rates, and the only people reason
[78:58] people want to stop spending money is
[79:00] when we raise rates." Humans want to
[79:01] consume things because we're human. I
[79:04] don't get hungry or get full depending
[79:07] on what you set the interest rate at,
[79:09] [ __ ] I'm hungry cuz I'm human. I
[79:12] want to live in a house because we have
[79:14] an innate desire to consume. We also
[79:16] have an innate desire to solve problems.
[79:18] Like, I don't want to drive through a
[79:21] bunch of [ __ ] potholes to pick up
[79:22] coffee for me and my fiance in the
[79:24] morning. So, I'm happy to fix the roads,
[79:26] but I'm not going to fix the roads if
[79:28] you take 50% of my wealth every single
[79:30] year, claim that you're going to fix the
[79:31] roads, and then don't fix the roads.
[79:33] You've already stolen half of my
[79:34] productivity over the last 12 months and
[79:37] on a go-forward basis. So, I think it'd
[79:38] be much better if you left the
[79:40] productive people to coordinate and
[79:43] problem-solve on their own instead of
[79:45] stealing property from them, assuming
[79:47] that they don't care about their quality
[79:49] of life. Like, it's such it's so
[79:52] how big of an [ __ ] are you
[79:55] to tell people, "You don't care about
[79:58] your quality of life and your
[79:59] surroundings, so we're going to take
[80:01] half of your property, half of your
[80:03] earnings, half of your productivity, and
[80:05] then end up wasting it and doing [ __ ]
[80:07] all with it and needing to raise taxes
[80:09] anyway." You like, it's
[80:11] So, no, taxing the rich, no.
[80:15] You just
[80:16] No, bad. And And there's no If there's
[80:19] no property rights, there's no
[80:20] functioning society. People need a right
[80:22] to to to property.
[80:24] If they don't actually own anything,
[80:26] society won't be able to function.
[80:30] Hey Jack, I'm newer to Bitcoin and I
[80:31] really enjoy the show. Can you help me
[80:33] understand the difference between
[80:34] printing the dollar and further dividing
[80:36] Bitcoin? Thanks for all you do.
[80:39] Uh, yes.
[80:41] So, uh, Bitcoin's divisibility, the size
[80:45] of the pie remains the same.
[80:49] Think of it that way.
[80:50] So, it'd be the equivalent of
[80:53] um, if you have a large cheese pizza,
[80:57] if you could divide up that one pizza
[81:01] into
[81:02] millions and millions and millions of
[81:04] pieces and everyone could be well-fed
[81:07] just off that tiny, tiny divisible slice
[81:10] as opposed to you have one pizza pie and
[81:12] then you print another and then you
[81:13] print another and then you print
[81:14] another. You know, as long as the size,
[81:17] the total size, doesn't grow, it is it
[81:20] is not inflationary. You're not diluting
[81:22] the value of it. Um, and so, the fact
[81:25] that Bitcoin is divisible is great
[81:27] because as the value of the 21 million
[81:31] grows, we can continue to divide it into
[81:33] smaller and smaller pieces to transact.
[81:37] Um, so it scales really well because the
[81:40] total size of the asset class is fixed
[81:42] to 21 million. Versus if there were a
[81:45] billion total US dollars and then they
[81:47] make it to 2 billion, 3 billion, 4
[81:48] billion, you're diluting the value of
[81:52] You can think of inflation
[81:56] as the US government is creating more
[81:58] dollars than goods and services in the
[82:01] economy.
[82:03] So, there are more US dollars competing
[82:07] for the services that we all need. So,
[82:10] there's more dollars competing for eggs,
[82:13] competing for cars, competing for
[82:14] houses, competing for gas.
[82:17] If the US government printed less
[82:19] dollars than growth in the goods and
[82:21] services that we want to consume,
[82:23] then the prices would come down because
[82:25] there would be more gas, more eggs
[82:28] competing for a fixed amount of dollars.
[82:30] So now replace that with Bitcoin. When I
[82:32] got into Bitcoin,
[82:33] my dream house was 100,000 Bitcoins per
[82:36] house cuz Bitcoin was so small when I
[82:38] got into Bitcoin. Now, an average house
[82:41] in America is like four Bitcoin.
[82:44] And so things in Bitcoin terms have
[82:46] gotten incredibly cheaper cuz there's a
[82:49] fixed amount of Bitcoin and more housing
[82:52] coming online, more eggs being produced,
[82:55] more more everything, more barrels of
[82:58] oil being produced, more gold being
[83:00] produced, right? And so everything
[83:02] against Bitcoin is deflationary. And
[83:04] then for fiat, it's the opposite. The
[83:06] size of the pie is not fixed. It grows.
[83:09] Does that make sense? Hopefully. If not,
[83:11] let us know. Welcome to the community,
[83:12] brother.
[83:14] Uh Bitcoin and markets. Hey Jack, a few
[83:16] months ago you mentioned your favorite
[83:17] online repository of how-tos, like how
[83:19] to set up your own node. Can you please
[83:21] give that to us again?
[83:23] Yeah. Let's see here.
[83:30] Um Matt Odell
[83:33] had a good one.
[83:36] Uh
[83:43] Here.
[83:48] There's a lot. Um so
[83:51] let's see if I can pull this up here.
[83:56] Some screen sharing again for everyone
[83:58] listening. Um
[83:59] so
[84:01] one of my best buddies, Matt Odell, his
[84:04] website is odell.xyz.
[84:08] And here's his little all the things
[84:11] he's involved in, but if you look at the
[84:13] top right over here, you've got guides.
[84:16] So here's a guide on Coldcard, which is
[84:20] a hardware wallet, running Bitcoin core
[84:23] UTXO management. He's got um
[84:26] and then he's got his Bitcoin tools down
[84:28] below. So, it's really cool. So, he's
[84:30] got offline hardware wallets and he's
[84:32] got them tagged for BitKey from Block,
[84:35] which is easy but has some trade-offs.
[84:38] And then Coldcard, which is the best but
[84:40] it's a bit more technical.
[84:41] Um and then different mobile wallets,
[84:43] different tools uh to use things. And
[84:46] so, um Matt is great. He's been doing
[84:50] Bitcoin
[84:51] uh education and tutorials and
[84:53] resourcing for many, many years. He's of
[84:56] a similar Bitcoin class as me. Um we've
[84:59] been close for a while. So, odell.xyz is
[85:01] a good one.
[85:03] And then, hold on.
[85:07] There's one more that's
[85:09] uh historically really good.
[85:12] Um
[85:16] So,
[85:17] hm
[85:19] Jameson Lopp used to have a really good
[85:21] one. So, he's at lopp.net.
[85:24] l o p p .net
[85:26] Admittedly, this looks different than
[85:28] what the last time I saw it. Not saying
[85:30] that's a bad or good thing, but just
[85:32] take it with a grain of salt. I haven't
[85:33] been on this website in a while.
[85:35] But, he has setting up a wallet, running
[85:37] a node, security, the history of Bitcoin
[85:41] um which I think is really, really cool.
[85:43] There's like I I
[85:44] If I wasn't running Strike in 21, I
[85:47] would be a Bitcoin historian. I'd be a
[85:49] retired Bitcoin historian. Um I just
[85:53] it's been such a privilege to be part of
[85:54] this revolution and there's so many cool
[85:57] stories from the old days and the
[85:58] culture of Bitcoin and uh just I'm
[86:02] obsessed with it. So,
[86:04] along with that, there's one more I want
[86:07] to give you guys.
[86:08] And this is less about wallet tutorials
[86:11] and running a node and more about
[86:13] Bitcoin's history. And that is, of
[86:15] course, the nakamotoinstitute.org.
[86:18] So, nakamotoinstitute.org
[86:20] run by
[86:21] Bitstein. It's just the best. So, I use
[86:24] this all the time. They have a section
[86:26] on here called the complete Satoshi,
[86:28] which is all of Satoshi's early emails,
[86:30] his forum posts, his original code, a
[86:33] collection of his best quotes, the
[86:35] original vision of the white paper. Um
[86:37] they also have really old writings from
[86:41] folks that were cited in the Bitcoin
[86:43] white paper, like Wei Dai. Um they have
[86:46] their own writings
[86:48] from long, long, long time ago. So, some
[86:51] of my favorite Bitcoin pieces were from
[86:53] 10 years ago by Pierre Rochard, Daniel
[86:57] Krawisz, all these guys. So, um this is
[86:59] much more for those interested in the
[87:03] history, early Satoshi writings,
[87:07] um but also a really good resource. So,
[87:09] between Odell, Lopp, and the Nakamoto
[87:12] Institute,
[87:14] those are some of the like the OG best
[87:16] resources.
[87:18] Um yeah.
[87:20] I think that's
[87:21] what you were looking for, but if not,
[87:23] let us know in the chat.
[87:28] Okay.
[87:29] Let's see.
[87:31] Um
[87:33] Love your show, Jack. Thank you. I
[87:34] really appreciate that. Uh I have a
[87:36] question. What are your thoughts and
[87:37] feelings about Saylor having to sell
[87:39] some of his Bitcoin? Is this good or bad
[87:41] for the Bitcoin ecosystem?
[87:44] Um
[87:45] >> [laughter]
[87:47] >> I I got to admit, I'm a little
[87:49] um
[87:52] Now, please, all of you clippers out
[87:55] there on Twitter, please don't edit the
[87:58] clip and make me look like a bad guy.
[88:01] I've nothing but love for Saylor, for
[88:04] strategy. Please,
[88:07] I'm going to say I'm a little tired of
[88:09] talking about them,
[88:11] not because I don't like them,
[88:13] but because I'm tired of all the online
[88:16] just it's ridiculous. It's such a waste
[88:18] of time.
[88:20] So, I'm only sick of talking about
[88:22] Saylor because every time I talk about
[88:24] Saylor,
[88:26] um
[88:26] uh the pitchforks come out to my Twitter
[88:29] account and it's just such a waste of
[88:32] time.
[88:33] Um what do I make of Saylor having to
[88:36] sell some of his Bitcoin?
[88:37] I've talked or or
[88:41] Yeah, look at me. These pitchfork
[88:44] mobsters uh
[88:45] on Twitter are ridiculous.
[88:48] He isn't necessarily selling his Bitcoin
[88:50] yet to my understanding and to be clear,
[88:51] I don't I don't know. I mean, it's a
[88:53] better question for Saylor. But, I guess
[88:55] he's open to the idea of and would if it
[88:58] made sense. Um to me, this was always
[89:02] the direction of his perpetual
[89:04] preferreds. So, I'm going to say my
[89:06] opinion with all love to strategy. Like,
[89:09] come on, guys. I don't know how else I
[89:11] don't know how else to answer a question
[89:13] I'm being asked in a public forum
[89:16] without saying
[89:17] please leave me alone and leave my dad
[89:20] and my family out of it. Uh for the love
[89:22] of God, please.
[89:24] Um
[89:25] this was always the design of a
[89:27] perpetual preferred. A perpetual, in my
[89:30] opinion.
[89:31] Take it for what it Take it for what it
[89:33] is, okay?
[89:34] A perpetual preferred is a when when the
[89:38] word perpetual is really important. This
[89:40] is non-callable. It never converts,
[89:42] meaning you owe the money forever. So,
[89:46] strategy owes 11 and 1/2% forever.
[89:50] That obligation never goes away. Now,
[89:54] obviously, they could just stop paying
[89:55] the dividends, but my assumption is that
[89:57] would really impair the credibility of
[90:01] the company if they just stopped paying
[90:03] the dividends. So, technically, in
[90:05] obviously the terms and conditions, they
[90:07] say one day we can just not pay it, but
[90:10] I'm working under the assumption that
[90:11] they're never going to do that. So, they
[90:13] have this
[90:15] fiat liability forever, 11 and 1/2%. And
[90:19] so, then the question is, so I think
[90:20] they've already issued like $10 billion
[90:23] of STRC.
[90:24] And if that's the case, let's just do
[90:25] the math. So, $10 billion, 11 and 1/2%
[90:28] of $10 billion is $1.5 billion, and
[90:31] that's per year forever.
[90:32] So, Strategy is going to owe $1.5
[90:35] billion forever.
[90:37] And the question is for a year. And the
[90:39] question is
[90:40] well, how are they going to fund those
[90:42] payments? That's a ton of money.
[90:44] Like, even if some of the biggest
[90:45] companies in the world had to pay that
[90:47] every single year, like, that would be a
[90:48] lot of money.
[90:49] And the question is, well, how do they
[90:52] afford to pay that? And what was always
[90:55] implied is they were going to fund it
[90:57] with their common equity. So, they're
[90:58] going to sell MSTR, the common stock, to
[91:02] finance these payments.
[91:03] But, what that implies, and I think
[91:05] Saylor from the clips I saw, I think
[91:07] Saylor was alluding to this on the
[91:08] earnings call, that almost implies
[91:10] leverage to this concept of the MNAV
[91:13] that they I think I think Strategy
[91:15] invented MNAV. I'm not sure. But, the
[91:18] idea of, you know, how much the business
[91:21] is worth relative to the the assets on
[91:24] balance sheet, and as long as the MNAV
[91:26] is above one, and there's like half a
[91:29] dozen different ways to compute MNAV,
[91:31] and I
[91:32] it's not clear to me that there's a
[91:33] singular definition. But, basically, as
[91:36] long as you can sell your common stock
[91:38] in what they call accretive, then,
[91:41] theoretically, you can finance it by
[91:43] selling equity and not diluting
[91:45] shareholders. But, obviously, the
[91:47] implication is that that you'll always
[91:49] live in those financial conditions.
[91:51] And if you don't, then that would
[91:53] present a problem. And I think people
[91:55] were speaking up and saying, "Hey, if
[91:56] you keep issuing STRC, and these are
[91:59] billions and billions and billions of
[92:00] dollars that you like if STRC grows
[92:02] another 10x, Saylor's going to be owing
[92:05] a billion dollars a month. Um
[92:08] which is
[92:10] you know, it depends on your view of the
[92:11] strategy and stuff. I would say it's a
[92:13] it's certainly an interesting trade. Um
[92:16] it could work in a big way, but it's
[92:18] very path-dependent.
[92:19] Um and so if the MNAV uh isn't above
[92:23] one, he basically came out and said,
[92:25] "I'm willing to sell Bitcoin to finance
[92:27] it." Um
[92:28] which
[92:29] to me was always implied.
[92:31] Uh people that have heard me talk about
[92:34] the preferred strategy before, um this
[92:37] isn't new information. Uh I've said it
[92:39] could be one of the most genius ideas
[92:41] ever. Um to me, I still want to watch
[92:45] some of I I consider it a largely an
[92:47] experiment still. Um some people, like
[92:49] Saylor, are super sold that it is like
[92:53] his iPhone moment and
[92:55] he could be right. I'm not like again,
[92:57] hands up. I'm not trying to insult
[92:58] anybody.
[92:59] But, um you know, seeing strategy start
[93:01] to say like, you know, and we might sell
[93:03] Bitcoin, to me some of this
[93:06] uh I was always curious about how it
[93:08] would play out. Um and uh cuz it's
[93:11] implied. I mean,
[93:12] if the MNAV isn't above one, you don't
[93:14] have a choice.
[93:15] Uh and so anyway, um at 21, we're
[93:18] watching. Obviously, Saylor invented a
[93:20] lot of the industry we're in. He's one
[93:22] of the greatest success stories in
[93:23] Bitcoin. Um and I mean, what he's
[93:26] building has a chance to be one of the
[93:28] biggest companies in the world. But, uh
[93:30] yeah, for me, a lot of this was always
[93:32] implied, which by the way, going back to
[93:34] 21 wanting to also have a focus on an
[93:36] operating company, um that's one of the
[93:39] reasons is if we can have cash flow,
[93:41] obviously, the dream is to finance
[93:43] something like leverage with cash flow.
[93:45] What if Saylor was making a billion
[93:47] dollars a year in cash flow? Then he
[93:49] wouldn't have to sell equity or Bitcoin.
[93:51] He would be producing enough cash to
[93:53] finance his conviction in all the
[93:55] Bitcoin that he's buying. And so I think
[93:57] that's still the dream Bitcoin company
[93:59] is if you have the earnings of a
[94:00] Coinbase and the conviction of a
[94:02] strategy, you combine the best of both
[94:04] worlds. Um but obviously it's easier
[94:07] said than done. There's no doubt about
[94:08] that. Um so doing it is the hard part,
[94:10] not coming up with the idea. So that's
[94:13] that's the task we have at hand. But
[94:15] anyway, those are my thoughts. I don't
[94:16] think many of them are new. Um
[94:19] You ended your question with is that
[94:21] good or bad for Bitcoin? Nothing's bad
[94:23] for Bitcoin.
[94:24] Um Unfortunately, sometimes people have
[94:26] to sell Bitcoin even when they don't
[94:28] want to. And like FTX had to sell a lot
[94:31] of Bitcoin they didn't want to. Mt. Gox
[94:33] like sometimes there are distressed
[94:35] sellers of Bitcoin and that's not a bad
[94:37] thing. So it doesn't really matter
[94:39] whether someone has to sell Bitcoin,
[94:41] wants to sell Bitcoin. Everything's good
[94:43] for Bitcoin. Bitcoin ends up finding a
[94:46] righteous home and over time because of
[94:49] the
[94:50] uh monetary properties that it has, um
[94:52] it goes up especially in dollar terms.
[94:54] But in everything terms, in oil terms,
[94:56] in eggs terms, in real estate terms,
[94:58] it'll continue to grind higher. But
[94:59] those are some of my thoughts. Um and
[95:01] again, I got all love for everybody.
[95:03] We're all on the same team.
[95:05] I really like it's gotten to the point
[95:07] where
[95:08] if I talk about
[95:11] strategy, then people start like coming
[95:13] after me and my family which is just
[95:16] it's not even worth the time. Like at
[95:18] the end of the day, I might be right, I
[95:19] might be wrong, but I don't
[95:21] >> [laughter]
[95:21] >> even like I'm tired of getting clipped.
[95:23] This is pointless.
[95:25] Uh I love the idea of your loan product
[95:27] but have never used it because 0% credit
[95:29] cards work better. Do you foresee a
[95:31] world where 0% periods on Bitcoin loans?
[95:34] No. Um
[95:38] Uh so a Bitcoin back loan's not a
[95:40] competitor to a credit card. Uh credit
[95:42] card actually makes money when you swipe
[95:45] the card. Merchants are paying the
[95:47] credit card processing networks 3, 4, 5%
[95:51] and then the banks issuing you the card
[95:52] get paid. So they don't necessarily need
[95:54] to make money on the, you know,
[95:57] predatory rates that um get charged
[96:01] after the 30 days or whatever. It's a
[96:02] totally different product. You're also
[96:05] spending money that you don't have yet.
[96:07] Um in a credit card, it's a it's a free
[96:11] line of credit extension based on your
[96:13] credit score or whatever. Bitcoin's
[96:15] totally different. If I have $10 million
[96:17] worth of Bitcoin or $100,000 worth of
[96:18] Bitcoin or 10 grand worth of Bitcoin and
[96:20] I want to get liquidity on the money
[96:22] that I already have without selling it,
[96:24] that's a collateralized loan. A credit
[96:26] card is uncollateralized line of credit.
[96:28] Uh or I guess it's collateralized
[96:30] against your reputation and your credit
[96:32] score, but whatever. Um a bunch of fiat
[96:33] [ __ ] Uh
[96:36] a collateralized credit card is it's the
[96:38] same thing for a HELOC. Is a HELOC ever
[96:41] going to be 0%? No. Um and one of the
[96:43] reasons, guys, is you're competing
[96:45] Someone has to fund the loan.
[96:47] So I'll tell you this, would you give me
[96:49] all of the fiat that you have to your
[96:51] name for 0% so that I can hand out to
[96:53] Bitcoiners?
[96:55] I assume the answer's no. Why would you
[96:57] do that? You should buy Bitcoin. You
[96:59] should buy Nvidia stock. You should buy
[97:02] uh you should you could buy a UST bill.
[97:04] Why would you give me your money at 0%?
[97:07] So then why would you expect someone
[97:09] else to do that, I guess? Cuz
[97:12] part of my job, what Strike does is we
[97:13] create a marketplace of people that want
[97:16] to lend out fiat for a fixed return and
[97:19] people that want to borrow against their
[97:20] Bitcoin, which is earned wealth, earned
[97:22] property they already have and they want
[97:23] to unlock liquidity of wealth they
[97:25] already have without selling it. And the
[97:27] problem is what rate are people going to
[97:29] demand to lend the fiat out against
[97:32] Bitcoin? Cuz they're saying I can
[97:33] already get 4% buying a UST bill or 5%
[97:37] buying a US 30-year Treasury. So you
[97:40] have to at least give me the risk-free
[97:43] rate from the US government. And then
[97:45] you also have, you know, why don't I
[97:47] just buy Nvidia? Why don't I just buy
[97:48] the S&P 500? Why don't I just buy
[97:50] Bitcoin myself? And that's where you get
[97:52] rates that are like 7 8 9 10 11% for
[97:55] Bitcoin-backed loans, but as long as you
[97:57] think Bitcoin's going to outperform the
[97:59] rate that you're borrowing it against,
[98:00] it's a no-brainer. Especially in the US,
[98:02] you've got short-term capital gains of
[98:04] 30%, long-term capital gains of 20%, so
[98:07] you've got rates that are less than the
[98:09] tax consequences of selling it and
[98:11] spending it. And you've got rates that
[98:13] are less than the long-term performance
[98:15] of the asset class.
[98:17] So, it's a no-brainer. But, it's very
[98:19] different than a credit card. These are
[98:20] not one-to-one comparable products, and
[98:22] no, I don't think borrowing against your
[98:24] Bitcoin's going to be 0% because that
[98:25] implies someone else's cost of capital
[98:28] is zero. Why would anyone And I mean,
[98:30] we're working on a product where we'll
[98:31] let our customers put up their cash to
[98:34] contribute in this network. Like, if you
[98:36] guys wanted 5 6 7% yield on your cash
[98:39] secured by Bitcoin, like, I can
[98:42] facilitate that market. But, I guess
[98:44] I'll ask you the question. Do you want
[98:45] to put up your cash for 0%? I would
[98:48] assume you I mean, you'd have to have
[98:49] gotten hit in the head with a rock to do
[98:51] that. Why would you do that? So, I don't
[98:54] know. At the end of the day, what you're
[98:56] competing with in that market is people
[98:58] can do other things with their money.
[99:00] So, what's the opportunity cost of
[99:01] lending it out against Bitcoin?
[99:04] And you know, Bitcoiners actually can
[99:06] afford these rates cuz Bitcoin's growing
[99:08] so fast and so much, and Bitcoiners by
[99:09] definition are net productive. In order
[99:12] to own Bitcoin, you had to have done a
[99:13] productive thing in your life. You had
[99:15] to have earned money, spent less than
[99:18] you earned, and had excess cash to buy
[99:20] Bitcoin. And so, you have a cohort of
[99:22] productive people that are hoarding and
[99:24] saving in the most productive or I guess
[99:27] productive is the wrong word. The the
[99:29] the highest-performing asset ever.
[99:31] So, anyway, hopefully that makes sense.
[99:34] I I don't foresee 0% rates on
[99:36] Bitcoin-backed loans anytime soon,
[99:37] especially cuz there's no other way for
[99:39] people to make money on it. There's no
[99:40] like credit card you're swiping. It
[99:42] would just be people giving away money
[99:44] for free.
[99:45] And so maybe someday the government is
[99:47] fully subsidizing Bitcoin back loans and
[99:51] maybe that's I don't know, but that I
[99:53] mean, no, I I don't think that that's a
[99:55] practical reality.
[99:57] Uh
[99:59] Dylan asked Jack, uh not all bills can
[100:01] be paid with a bank account and a credit
[100:03] card. This is why we need a debit card.
[100:05] Nothing to do with better credit cards
[100:07] out there and or credit card rewards.
[100:09] Um if you can DM the Strike Twitter
[100:13] account with an example of the bills
[100:14] that you're referencing,
[100:16] uh
[100:17] just shoot us a note. We want to learn
[100:19] more about what you're talking about and
[100:20] what products to build. Like I said, we
[100:23] you know, we take a on a philosophical
[100:25] approach at the company that our job
[100:27] isn't to guess the future. Our job is to
[100:29] be humble and listen to you guys. Uh and
[100:31] so whenever you speak, we listen. So, DM
[100:34] us and let us know what bills you're
[100:36] talking about. We want to make sure you
[100:37] have an ability to pay them.
[100:39] Question for Jack, can we get an update
[100:40] on the yield on cash product? Thanks. Uh
[100:43] we're feeling good about this. We're
[100:44] moving as fast as we can to make the
[100:46] product available uh in the coming
[100:48] months. So, super super exciting.
[100:51] Uh we think we're going to have our
[100:52] first iteration very, very soon.
[100:54] Uh Strike question, will be will we be
[100:57] able to DCA a specific amount of sats on
[101:00] Strike, not just the dollar amount? For
[101:02] example, if I wanted to DCA 10,000 sats
[101:04] a day, no matter the dollar price.
[101:07] Um
[101:08] this is a funny one. So, we've thought
[101:09] about this, but it leads to
[101:12] a really interesting user experience
[101:14] where
[101:15] the price of Bitcoin spikes and your
[101:17] 10,000 sats goes through cuz you're
[101:20] denominating it in sats and
[101:23] like what if you don't have enough money
[101:25] in your account or what if all of a
[101:27] sudden that
[101:28] like DCA gets really expensive. And so
[101:32] um it's something we could do in the
[101:34] future. I just don't know what it solves
[101:36] for, generally speaking.
[101:38] Um, but anyway, I don't know. We We've
[101:40] designed it and we're like, "Wait a
[101:42] second. You know, sometimes people only
[101:44] have so much money in their account and
[101:46] then if the Bitcoin price goes up a lot
[101:48] and it gets really expensive in order to
[101:51] pull off the DCA and we start like, you
[101:53] know, people's bank accounts put freezes
[101:55] on on their linkage to strike because,
[101:58] you know, a transaction doubled and I
[102:00] don't know. We We've We've gone through
[102:02] it. Uh
[102:03] but
[102:04] I'll ask the product team and see uh
[102:06] if it's worth revisiting cuz it's not
[102:08] the first time I've heard that.
[102:11] Um
[102:13] Okay. Last question.
[102:16] Jack, best Bitcoin show on the web. I've
[102:18] learned so much from your takes. [ __ ]
[102:20] the haters. Keep on going. Keep on
[102:22] keeping on.
[102:23] What is your favorite feature about
[102:25] Bitcoin and something I should study up?
[102:27] I appreciate that. I also appreciate
[102:29] Dylan. He keeps putting these
[102:30] compliments in at the end. That's a real
[102:33] That's a real friend right there.
[102:35] Cuz the haters be hating, man. But uh
[102:37] no, I appreciate it. I'm all good, man.
[102:39] It It feels good to be home
[102:41] uh and not in Las Vegas. And uh I
[102:43] appreciate you guys. You guys are great.
[102:45] Like I said, this morning when I was
[102:47] getting out of the shower,
[102:48] feeling [snorts] like a million
[102:49] Bitcoins. I was so fired up to get to
[102:52] work on the new monetary system, do the
[102:53] show with you guys. Uh I really am
[102:56] blessed. Um
[102:58] You guys are the best.
[102:59] Uh what is a my favorite feature about
[103:02] Bitcoin that you should study up on?
[103:05] Hmm.
[103:09] This is a weird answer, but
[103:12] uh
[103:13] I'm going to do
[103:15] So,
[103:17] through Bitcoin, I got into these uh
[103:20] rabbit holes on health and specifically
[103:23] food.
[103:24] And so, I've talked a little bit about
[103:27] that, like things like carnivore diet or
[103:28] animal based and at the end of the day,
[103:31] it doesn't really matter. There's a lot
[103:32] of ways to be healthy. Now, you know, I
[103:35] have my bias and my opinions, but it's
[103:37] not even worth, you know, ranting about
[103:40] that. What I would say is there's a
[103:42] book, there's a few books. There's a
[103:44] book called Fiat Food by Saifedean and
[103:47] and Matthew, I forget how to pronounce
[103:48] his last name.
[103:50] Uh, and there's a ton of readings, um,
[103:57] uh, hold on.
[103:59] Cuz Bitstein also had a carnivore
[104:03] page.
[104:08] Hold on.
[104:11] >> [sighs]
[104:14] >> Dang, I'm not going to be able to find
[104:16] it. But I would say, um, something kind
[104:18] of like
[104:20] parallel with Bitcoin. Uh, Bitcoin's
[104:22] taught me so much about the world and so
[104:23] much about how I view the world and
[104:26] myself and my morals and my values and
[104:28] my principles and food and diet and
[104:31] health is one of those. Our health and
[104:32] our uh, diet has deteriorated along with
[104:36] our money. And there's a serious
[104:38] correlation there that needs to be
[104:40] studied and explored. And I think health
[104:42] is wealth. I mean, there's no point in
[104:44] Bitcoin succeeding and fixing the world
[104:46] if you're not going to be around here
[104:48] for it. And that goes for your loved
[104:49] ones as well. Uh, you know, my dream, as
[104:52] I said, is, uh,
[104:53] to be a great fiancé and hopefully
[104:57] husband and hopefully father and have
[105:00] kids and family and and be around, uh,
[105:03] to raise them.
[105:04] And I think, uh,
[105:06] being self-sovereign in the health
[105:09] aspect is also a very serious
[105:10] responsibility that people don't
[105:12] necessarily appreciate. It is
[105:14] it is grim out there. Uh, so, yeah, I
[105:19] would look up the book Fiat Food, Why
[105:21] Inflation Destroyed Our Health and How
[105:23] Bitcoin Fixes It.
[105:25] And, uh, maybe next episode, if there's
[105:27] enough interest, um I will have time to
[105:31] dig in some of the other resources um
[105:33] that I have, but I would start with that
[105:35] book. You can get it on Kindle and
[105:37] Amazon or Audible, Apple Books, all of
[105:40] that. Really good. It's by Saifedean who
[105:42] wrote The Bitcoin Standard. So, that's
[105:44] one of my favorite um
[105:46] you know, rabbit holes that Bitcoin
[105:49] tripped me down.
[105:52] And just encouraging people to look
[105:54] after their health. You know, don't you
[105:56] know, at some point it's not worth uh
[105:59] staying up to the wee hours of the
[106:01] night, compromising on your health,
[106:03] eating McDonald's all day, sacrificing
[106:06] relationship, not getting outside,
[106:07] seeing the sun, exercising. You know, I
[106:10] I think especially with AI,
[106:12] it's not about working
[106:15] till you kill yourself anymore. I think
[106:17] at one point, you know, like putting in
[106:18] the hours um was a way to outwork
[106:21] people, but now you have such an
[106:22] opportunity to work smarter. Um you've
[106:25] got AI that can be doing tasks for you.
[106:28] You've got Bitcoin that's protecting
[106:29] your savings. And I I really think that
[106:32] that leaves, you know, Bitcoin and AI
[106:34] give so much of your time and energy
[106:35] back to you. Um it's protecting you from
[106:39] being abused by the system, and you have
[106:41] the opportunity to really take care of
[106:42] yourself and uh
[106:44] build relationship and build family. And
[106:46] so, I don't know. I think that's that's
[106:49] part of my Bitcoin journey at least is
[106:51] realizing that the new wealth Bitcoin
[106:53] has given me is not just nominal net
[106:55] worth, but also, you know, the
[106:57] opportunity to have fallen in love and
[106:58] gotten engaged and have friends. This
[107:00] This past weekend I went golfing with my
[107:02] buddies, and that's just I mean,
[107:05] you know,
[107:05] it's the type of feeling I get when
[107:07] Bitcoin makes a new all-time high. Just
[107:09] being out in the sun with my friends,
[107:10] swinging a golf club, going to dinner
[107:12] with my fiance, planning our wedding.
[107:14] And so, Fiat Food opened my eyes to
[107:16] just, you know, what money has done to
[107:19] the nutrients we're putting in our body
[107:21] and the related crisis when it comes to
[107:24] disease and metabolic health
[107:26] and lifespan and life expectancy.
[107:29] And
[107:30] yeah.
[107:32] I'd encourage you all to check it out
[107:33] and take care of yourselves.
[107:35] And with that
[107:37] I'm out of here.
[107:39] Much love you guys. The tale two wolves.
[107:41] Let's continue to watch how it plays
[107:43] out. Booming AI and economy running hot
[107:46] and a
[107:48] global supply chain crisis that's only
[107:50] getting stronger and more terrifying.
[107:53] Thank whoever you believe in for
[107:55] Bitcoin. Holy smokes. Can you believe if
[107:57] we did not have Bitcoin to believe in
[107:59] and protect us, where would we be right
[108:01] now? What a crazy time. Thank you
[108:03] Satoshi and thank you guys for
[108:04] listening.
[108:06] Comments, questions, criticisms, I'll be
[108:07] in the comments as always and I will see
[108:09] you next week. Peace and love.