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CJ Konstantinos | The True Condition of the Economy | Simply Bitcoin TTO · Simply Bitcoin

• 0:24
  What's up, everyone? We're back.
• 0:26
  Welcome back. It's been a, it's been a minute
• 0:28
  since I've done a TTL, you know, been working, grinding.
• 0:31
  And I'd like to do these when I'm inspired to have these
• 0:34
  conversations with people. And last time I brought CJ on,
• 0:39
  he absolutely slayed it. You guys were going wild in the
• 0:41
  chat, you guys kept telling me to bring him on.
• 0:44
  You guys were asking questions. Well, if we have enough time, we
• 0:48
  will get kind of back to some of the topics we had last week.
• 0:51
  But CJ has been dropping epic threads on Twitter, which I
• 0:55
  think everyone should be following.
• 0:57
  You guys should be following what he's saying on Twitter.
• 1:01
  I think he's dropping a lot of Nuggets.
• 1:03
  And so I wanted to bring him on and talk about all this stuff
• 1:06
  right now and in as simplest terms as possible so that we can
• 1:09
  understand what the hell is actually going on in the world.
• 1:12
  So without further ado and without, you know, dragging on
• 1:15
  this monologue, CJ, how are you doing, brother?
• 1:18
  Good to have you. It's been a minute.
• 1:20
  And and last time you came on, we were kind of joking that you
• 1:23
  were hitting the nail on the head.
• 1:24
  And I think we're at that moment again where you're just dropping
• 1:27
  too much wisdom. And it happens like, I don't
• 1:30
  know, I I saw some threads and and it'll happen like a week
• 1:32
  later. And I I do have them up here.
• 1:34
  So we'll talk about that. But CJ, how you doing, brother?
• 1:37
  I'm doing good. Thanks for having me back on.
• 1:38
  It's an honor to be here. And if this were ever the time
• 1:42
  to ring the warning bell right now is it awesome, awesome.
• 1:45
  Okay. Well let me just pull some of
• 1:47
  these threads up so we can basically get into them and we
• 1:52
  will use them as jump off point. So first thread, actually
• 1:56
  actually before we go in, like I was saying before the show and I
• 2:01
  was telling everyone right now, maybe we got to break down some
• 2:04
  of these topics like as simple as possible.
• 2:07
  So first and foremost, we are going to be talking about
• 2:10
  interest rates. We are going to be talking about
• 2:11
  the bond market. We might even get into stable
• 2:14
  coins if we don't go too long. So maybe here's the first
• 2:18
  thread, this is pinned on your Twitter guys and also go follow
• 2:21
  him, CJ Constantinos on Twitter, highly recommend you guys follow
• 2:26
  him. But here's the first one, And
• 2:30
  oddly enough, before you posted this, it seemed like, oh, maybe
• 2:34
  C, JS just talking randomly out of thin air.
• 2:36
  And I do have the receipts of Jay Powell saying this exact
• 2:39
  thing. So maybe first and foremost,
• 2:41
  let's cover this thread for the people, and then, you know, give
• 2:44
  them some definitions and then maybe we'll bring up Jay Powell.
• 2:48
  Awesome. Yeah, so actually this is the
• 2:51
  this is the tweet that Max Kaiser quoted and was actually
• 2:56
  cited in a Forbes article talking about the death spiral.
• 3:01
  So what's happening here is I just wanted to draw a simple
• 3:04
  line of what the conclusion of what's the the Fed is doing
• 3:09
  right now 'cause even today you heard the the governor's come
• 3:12
  out and couple presidents come out and say what's happening is
• 3:15
  that rates are going to stay higher for longer because their
• 3:19
  ideas that higher rates is going to fight off inflation.
• 3:24
  And without going into too much detail, let me say it this way.
• 3:29
  They would be correct. If, if, and here's the big if,
• 3:33
  if the United States wasn't $36 trillion in debt, or I think
• 3:39
  it's 3034, it's getting up there pretty close.
• 3:42
  It's it's growing fast. It's hard to keep track of.
• 3:45
  It's growing so fast. But we're $34 trillion in debt.
• 3:49
  We have $211 trillion of unfunded liabilities, which
• 3:56
  means that. We have a problem because we're
• 4:00
  not earning money, you and I. We go to work, we earn money,
• 4:03
  and then we spend less money than we earn.
• 4:06
  And whatever is leftover, we can save or we can invest, depending
• 4:10
  on what the marketplace is incentivizing us to do.
• 4:13
  Well, the government doesn't work that way.
• 4:15
  They collect roughly $4 trillion in taxes, and then they claim to
• 4:20
  be spending 6 or $7 trillion. We're finding out now it's
• 4:25
  probably closer to 8 and $9 trillion that they're spending.
• 4:29
  So we're running what's called a budget deficit.
• 4:32
  We're spending more money than we're earning, and that creates
• 4:35
  a debt problem. And that's why we have the big
• 4:38
  debt and the unfunded liabilities.
• 4:40
  But here's the real issue. In order to continue to fund
• 4:44
  those liabilities, or in other words, in order for people to
• 4:47
  still receive their Social Security.
• 4:50
  In order for people to still receive different government
• 4:53
  benefits and programs and payouts, that money needs to be
• 4:57
  borrowed. And when they borrow that money
• 4:59
  at a higher interest rate, that raises the deficit, and that the
• 5:05
  raising of the deficit requires more borrowing, which is issuing
• 5:09
  of more treasuries, which forces the yields higher.
• 5:12
  And you get in. You get stuck in this kind of
• 5:15
  cycle where you can't really escape it.
• 5:18
  And that's what my tweets have been about and I think people
• 5:21
  are really starting to wake up to it.
• 5:23
  And that's why we see the 2627 trillion dollar bond market with
• 5:29
  more volatility than the stock market, more volatility than
• 5:33
  Bitcoin. How's that possible?
• 5:34
  I thought Bitcoin was dangerous because it's volatile.
• 5:37
  The the the bond market is supposed to be the most stable
• 5:39
  market in the world, and it's become the most volatile market
• 5:43
  in the world. And the reason is, is because
• 5:45
  the government is stuck in a situation where they're spending
• 5:49
  more money than they're collecting.
• 5:51
  And and that's the dilution of the dollar.
• 5:53
  That is a definition of inflation.
• 5:56
  They're collecting the dollars, they're borrowing the dollars
• 5:58
  and they're spending them into circulation.
• 6:02
  And that increases the overall amount of circulating dollars in
• 6:06
  the country and in the world even.
• 6:08
  And that creates the inflation and this kind of.
• 6:12
  Death spiral. The death death spiral is what
• 6:15
  Forbes called it is, is almost impossible to escape.
• 6:19
  And that's what some of my newer tweets were about where right
• 6:23
  now in a traditional market, like think about like this,
• 6:26
  we're all lenders, right? So when we go to the bank, we
• 6:29
  actually don't deposit our money with them.
• 6:32
  We lend our money to them and that's why they pay us interest.
• 6:36
  Now what the bank did was they took the money that we gave
• 6:40
  them. And they went and they bought a
• 6:41
  corresponding asset on their balance sheet.
• 6:44
  So they don't just take our dollar and hold it, they take
• 6:46
  that dollar and they invest it. And the goal is to generate a
• 6:50
  yield with that investment that's larger than the amount of
• 6:55
  interest they promised to pay us for the original deposit
• 6:59
  lending. And they arbitrage.
• 7:01
  I call it custodial arbitrage. They arbitrage the difference
• 7:05
  between what they have to pay to their depositors and what they
• 7:08
  can earn and yield in the background.
• 7:10
  Well, when the Federal Reserve lower rates in 2008 all the way
• 7:16
  down to 0, something happened. The banks had to, in order to
• 7:21
  earn interest, go out the yield curve.
• 7:24
  They had to go to the longer expirations.
• 7:26
  They they couldn't just buy the three month or the six month or
• 7:29
  the two year. They had to move out the yield
• 7:31
  curve in order to actually make a profit.
• 7:34
  So they've got bumped out into the note and to the bonds.
• 7:37
  And and remember there's three types of treasuries.
• 7:40
  You have a treasury bill which expires in less than a year.
• 7:42
  You have a treasury note which is 2 to 10 years, and you have a
• 7:46
  bond which is 20 plus. So they got pushed out from the
• 7:49
  bills which had the least amount of duration, time, duration,
• 7:53
  risk all the way out to the end of the curve into the bonds.
• 7:57
  And they had to because the feds stated the front end of the
• 8:00
  curve down to 0. So if they're depositors, if you
• 8:03
  remember at one point when your money in the bank, it would get
• 8:06
  zero point. 1% or 0.01%. Why?
• 8:10
  Well, because the banks were having a hard time getting
• 8:12
  anything at all. So they can't pay you more than
• 8:16
  they're making. They'll go out of business.
• 8:18
  And that process of getting pushed out the yield curve is
• 8:21
  why they got stuck. Because now when the Fed had to
• 8:24
  raise interest rates to fight inflation, it diluted the value
• 8:28
  of the collateral, and the collateral was the government
• 8:31
  debt that was supposed to be producing the yield.
• 8:34
  Which was producing the profit because the yield was greater
• 8:36
  than the amount of profit sharing they were doing with
• 8:40
  their depositors. That whole system is breaking
• 8:43
  down right now. And I said that when I was back
• 8:45
  on your show back in March. These guys are breaking the
• 8:49
  system by raising interest rates because they're devaluing the
• 8:54
  the collateral of the system. When they raise the interest
• 8:57
  rate, the yield goes up but the price goes down.
• 9:00
  So, you know, for anybody who borrow is against Bitcoin.
• 9:04
  If if if you know, let's just say Bitcoin was worth $100,000
• 9:07
  and you borrow $70,000 against it.
• 9:11
  Well if the price of Bitcoin goes down, the leverage of your
• 9:15
  position increases, the loan to value percentage increases.
• 9:19
  And if it goes down from 100,000 to 70,000, the person who is
• 9:23
  holding that collateral is going to say, well, I don't trust CJ
• 9:27
  to pay me back $70,000. I have to sell.
• 9:30
  I have to liquidate that $70,000 of Bitcoin in order to make sure
• 9:33
  that I don't lose money on this transaction because he came to
• 9:36
  me with $70,000. He hasn't paid it back to me
• 9:39
  yet, but now the value of this collateral is $70,000.
• 9:42
  I better sell it and lock in my my 70,000.
• 9:45
  Make sure I don't lose any money here.
• 9:47
  Well. That's not a situation that you
• 9:50
  really want to be in as a borrower or a lender because
• 9:53
  there's liquidation risk and you might not get recover the full
• 9:55
  $70,000. There's exchange fees there
• 9:58
  might be some slippage in there with a bigger position.
• 10:01
  So you could you could actually end up losing money.
• 10:04
  The treasury collateral is losing value every time they
• 10:08
  raise the interest rates. Of course, we all know they did
• 10:10
  the most aggressive interest rate hike in the in the recorded
• 10:14
  history. The the amount of percentage of
• 10:16
  growth in the in the rate. Is unmatched through previous
• 10:20
  raises and they devalued the collateral just as fast as they
• 10:25
  raise the interest rates. And kind of just to tie this
• 10:27
  back into Bitcoin, I I want people to think of because
• 10:31
  remember last time I was here I said Bitcoin is transforming
• 10:33
  from digital gold to digital collateral.
• 10:36
  Well look Treasury collateral did so well as collateral
• 10:39
  because the Fed forced rates to stay even.
• 10:42
  So the principal value of that collateral stayed pretty steady,
• 10:45
  but over time. It's now deteriorating, and
• 10:49
  that's because the amount of inflation that they created
• 10:51
  through deficit spending. But imagine Bitcoin as the
• 10:55
  world's most pristine form of collateral, the reserve asset of
• 10:58
  the Internet economy, a deflationary money that gains
• 11:02
  value over time. They had a state, the rate of
• 11:06
  bonds and Treasuries lower so that the value would stay stable
• 11:11
  so that they could support the system and Bitcoin.
• 11:14
  Would actually be a collateral where you you can't state the
• 11:17
  rate because it's an open free market.
• 11:18
  Matter of fact, it's the only free market interest rate in the
• 11:22
  world. Every single country, every
• 11:24
  single leader, every single central bank, they try to to
• 11:28
  state the price of money. Only in the Internet economy is
• 11:32
  the interest rate based on the supply of money and the demand
• 11:36
  for loans. When the supply of money is high
• 11:38
  and the demand for loans is low, interest rates go down.
• 11:41
  When the supply of money is low and demand for loans are high,
• 11:43
  interest rates go up. It's a free market price
• 11:47
  discovery mechanism the same way.
• 11:49
  It really should work in the traditional system, but it
• 11:50
  doesn't, and that's an advantage for Bitcoin.
• 11:53
  So not only do we have free market price of money or free
• 11:56
  market interest rates and free market price discovery, we also
• 11:59
  have a new collateral, the most pristine form of collateral in
• 12:02
  the world that's deflationary and gains value over time that
• 12:06
  way over time. As it's acting as collateral,
• 12:10
  the amount of leverage actually decreases.
• 12:13
  If you're borrowing against it your your loan to value goes
• 12:15
  down you're you're you're more safe, right.
• 12:18
  Just like if they stated treasury rates from today from
• 12:21
  5.25 to 5.5 target all the way down to zero, well then the the
• 12:27
  the market price value of the Collier will go back up.
• 12:30
  It would actually make the system more stable and more
• 12:33
  secure. Of course, there's trade-offs
• 12:35
  with that because when rates go down.
• 12:37
  Helicopter money, funny money, lots of extra borrowing is going
• 12:40
  to take place and all of that information is really wrapped up
• 12:45
  into that tweet. The process of the marketplace
• 12:48
  incentives, the value of the collateral, the rate at which
• 12:51
  the collateral is being devalued through this interest, interest
• 12:56
  rate hiking process that we're going through right now, all of
• 12:59
  that comes together and creates the debt death spiral and we're
• 13:04
  stuck in it right now there is. There is nothing that the
• 13:08
  Federal Reserve can actually do. And that was one of my most
• 13:13
  recent tweets. I You have to, when you read my
• 13:15
  tweet, you have to come to one of two conclusions.
• 13:18
  One, I'm a complete idiot and I have no idea what I'm talking
• 13:22
  about. Or two, you better listen to
• 13:24
  what this person saying, because something's happening right now
• 13:27
  that's never happened before in the history of finance.
• 13:30
  And unfortunately, I wish I was an idiot, but I'm not.
• 13:34
  And we are seeing. For the first time in the
• 13:37
  history of finance, the sovereign debt market exploding
• 13:40
  because of those levels of debt. You would think if the Federal
• 13:43
  Reserve could raise interest rates and attract more people to
• 13:48
  borrow treasuries then that would be the natural process of
• 13:53
  attracting demand. But what the smarter market is
• 13:56
  figuring out what the smart money, Dumb money is buying
• 14:00
  bonds right now. Dumb money is is betting on TLT.
• 14:04
  I'm sure you have the tweet Opti, but 21 billion in 2023
• 14:09
  alone going into Black Rock's TLT, long dated treasury fund
• 14:15
  everybody and their mother. It's like the common trade,
• 14:18
  right? It's like when Bitcoin was 6970
• 14:20
  thousand dollars. You go to the grocery store and
• 14:22
  someone's like, hey, have you heard about Bitcoin?
• 14:24
  It's like, whoa, maybe I should maybe I should think about
• 14:27
  selling a little bit here, buying some real world assets
• 14:29
  because who knows what's going to happen when everybody's
• 14:31
  talking about it, right? But then after the.
• 14:34
  Crash, you're telling people, hey, it's a great time to buy
• 14:36
  some Bitcoin here, They're laughing at you.
• 14:38
  So the mainstream sentiment is usually off.
• 14:41
  Mainstream sentiment is is wrong.
• 14:43
  And right there on that chart, that is what the the mainstream
• 14:47
  is hoping and praying for. The mainstream is hoping and
• 14:51
  praying that we get some kind of head and shoulder design here
• 14:55
  where the yields bounce. Maybe they bounce back up a
• 14:58
  little bit, but ultimately they break this trend.
• 15:01
  You see this trend that we have here going all the way since
• 15:03
  back May. This is very aggressive selling.
• 15:05
  This might look like prices going up, but this isn't price,
• 15:09
  this is actually yield. So it's inverse.
• 15:11
  The the price is going down. These are the yields going up.
• 15:14
  Everybody hopes that these yields break this trend and come
• 15:18
  back down to 4% and then break down even lower.
• 15:21
  And the reason is, is because they're the ones who are buying
• 15:23
  the notes and the bonds, this is actually the 10 years.
• 15:26
  So this would be a note. They're the ones buying it
• 15:28
  piling in. Hoping that they're going to get
• 15:31
  a capital gain. But what they don't realize is
• 15:34
  as they pile into this, they're actually just looking at the
• 15:38
  face value of the opportunity, which is, hey, it's 4%, it's 5%.
• 15:44
  I can't go wrong, but you have to be able to sit here and say I
• 15:48
  can't take this at face value if my bank is offering me ACD at
• 15:52
  5.25% or I have an opportunity, an investment opportunity at 6%
• 15:56
  or 7%. You have to calculate the real
• 15:59
  rate of return, the real rate of return.
• 16:02
  And before I dive into real rate return, let me just address this
• 16:05
  chart one more time because I find it extremely interesting
• 16:08
  that we had these big buyers step in.
• 16:11
  And if you update this chart today, there was a little bit of
• 16:14
  a bounce, but we're still above that four or five level.
• 16:17
  But you'll notice the the, the candles, they were about to
• 16:20
  cross that yellow line. Well, that yellow line is the 2
• 16:23
  year note yield, so the 10 year. And the two year we're about to
• 16:27
  UN invert and the green line is the three month bill that's the
• 16:31
  shortest duration available to the public.
• 16:34
  You'd have to have a a master account with the Fed to access
• 16:37
  the repo market or give your money to a money market fund in
• 16:40
  order to get a better deal than the three month.
• 16:43
  It's the it's the best short term duration with the lowest
• 16:47
  inflation risk because of the the time frame.
• 16:49
  We we know we'll get paid back our money in three months and
• 16:53
  and we think we're going to be able to buy this with it.
• 16:56
  But what about in 10 years you, you know you're going to get
• 16:58
  your money back, but you don't know what the hell you're going
• 17:00
  to be able to buy. That's the that's the real risk,
• 17:02
  it's the inflation risk. And if these yields uninverted,
• 17:07
  then the historical, what they call a normalization.
• 17:10
  Because let's just think about for a second.
• 17:12
  Like if I said, hey Opti, I want to borrow, you know, $1,000,000
• 17:16
  from you and I want to borrow it for three months.
• 17:19
  Then you would say, OK, yeah, it's cool.
• 17:21
  You can borrow it for 5%. I I, you know, I think that's
• 17:23
  good. I trust you as a counterparty
• 17:25
  and I know you're good for it, let's do it.
• 17:27
  But what if I said, hey Opti, I want to, I want to borrow for 10
• 17:30
  years. Well, would you raise the
• 17:33
  interest rate or would you lower the interest rate?
• 17:35
  Obviously you would raise the interest rate because there's
• 17:37
  more risk. So in a normal yield curve, the
• 17:40
  shorter the duration of the loan, the lower the interest
• 17:43
  rate. The longer the duration of the
• 17:46
  loan, the higher the interest rate.
• 17:48
  That's the natural way that these things work.
• 17:50
  It's called a term premium. Well, what happens when the
• 17:53
  yield curve becomes inverted and the short term rates are higher
• 17:57
  than the long term rates? There's really only one way to
• 18:01
  justify this and the justification by the the
• 18:04
  marketplace is this. We think that there's going to
• 18:07
  be a huge deflationary event and because there's going to be a
• 18:11
  huge deflationary event. The Federal Reserve is going to
• 18:14
  have to lower the interest rate, and when they lower the interest
• 18:17
  rate, not only will I get a capital gain, but and these
• 18:21
  guys, these guys are the real doomsdayers, right?
• 18:23
  I'm I'm looking toward to a Bitcoin future, to a truth money
• 18:26
  future. These guys want a a depression,
• 18:29
  they want a recession 'cause they want prices to crash so
• 18:32
  that they can turn their bonds and lock in that capital gain
• 18:35
  and then buy real world assets. So they're they're kind of
• 18:39
  hoping against everybody just so that they can get a little bit
• 18:42
  more. But the reality of the of it is
• 18:45
  that the only reason if you if you're managing a large amount
• 18:48
  of money and you're trying to protect that money, the only
• 18:52
  reason that you would buy a 10 year note for less than a three
• 18:56
  month bill, right? Because you could just get the
• 18:58
  five and 1/2 at three months. Why in The Who the hell is
• 19:01
  buying 10 years at less than 5 1/2 when you can get three
• 19:05
  months at 5 1/2 because the three month you can roll over
• 19:09
  roll. So the 10 years of saying I want
• 19:11
  to lock this rate in. Because I think the rates are
• 19:13
  going down. What does that mean?
• 19:16
  When you simplify this down to the core of it, what it truly
• 19:18
  means is the market believes the Federal Reserve's 2% inflation
• 19:23
  target because that's how you calculate your real rate of
• 19:26
  return. The real rate of return is not
• 19:27
  the nominal number that you see on the screen.
• 19:30
  The real rate of return for the three month bill is not 5.5%.
• 19:34
  The real rate is 5.5% minus the inflation rate.
• 19:40
  That's your real rate of return. That's going to tell you how
• 19:42
  much your purchasing power has increased, right?
• 19:45
  Because if you're earning 5 1/2% but prices are increasing by 2%,
• 19:50
  well then you only earn 3 1/2%. So the real rate of return is
• 19:54
  what creates marketplace incentives, not the nominal
• 19:57
  rate. So in order for the nominal rate
• 20:00
  to be lower on the 10 year versus the three month, that
• 20:04
  person or that manager has to be thinking in their mind?
• 20:08
  I want to lock in this rate because I believe the Federal
• 20:11
  Reserve is at 2% and because the Federal Reserve is at 2% and
• 20:15
  they're going to maintain their target because they have control
• 20:18
  of the marketplace, they have control of inflation, they're
• 20:20
  going to get it back down to 2% and they're going to keep it
• 20:22
  there. Well, then at 4%, I have a 2%
• 20:26
  real rate of return year over year, I'm going to, I'm going to
• 20:29
  grow my purchasing power by 2%. This is a fantastic deal.
• 20:33
  I'd love to lock that in for 10 years.
• 20:36
  The problem is, is that the This is why I call it financial
• 20:40
  COVID, because if you look back towards COVID now in hindsight,
• 20:44
  we can look back and be like, holy crap, we locked down
• 20:47
  everything for the flu. Somehow in 2019, a lot of people
• 20:51
  have flu. Some people died in 2020, a lot
• 20:53
  of people have flu, some people died 2000, 2020, one, nobody had
• 20:58
  the flu because everybody got COVID, right.
• 21:01
  So when we look back at the data, we're like, wait a second,
• 21:03
  that data doesn't quite make that much sense.
• 21:06
  So what really happened here? Well, the result of that was
• 21:11
  people lost trust in the medical field.
• 21:13
  People, people wanted to switch doctors, people wanted a
• 21:16
  different opinion. The level of trust in the
• 21:18
  medical field diminished because of the way the data was botched
• 21:22
  through that whole process. Well, we're we're the that's
• 21:26
  what's happening right now in finance.
• 21:28
  In finance, the data is being botched.
• 21:31
  I don't really care if it's happening on purpose or if it's
• 21:35
  happening by accident. It doesn't matter.
• 21:37
  The data is wrong. So what we have to do is we have
• 21:39
  to identify the correct data and in order to do that, thankfully
• 21:44
  we still have access to this data.
• 21:47
  The data is is free and abundant, but the proper
• 21:50
  analysis is scarce and costly. So what we need to do is we need
• 21:56
  to take a step back and say, how do I determine what inflation
• 21:59
  is? Well, the real rate of inflation
• 22:03
  is is up for debate. But if you sit down on your
• 22:06
  personal balance sheet and you look at your expenses compared
• 22:09
  to your living standards and your quality of life and how you
• 22:12
  like to spend and consume, well then what that means is that you
• 22:17
  can sit down and calculate a number.
• 22:18
  Now if you sit down, you take the time to calculate that
• 22:21
  number. I guarantee you it's not 3.7%,
• 22:25
  it's not and it and it's definitely not 2%.
• 22:29
  But the people who are buying the 10 year, they think it's
• 22:32
  going to be 2%. They think the Fed is going to
• 22:35
  get that rate back down to 2%. They can't get that rate back
• 22:39
  down to 2%. That's why the yield started
• 22:41
  shooting off. The smarter money started
• 22:44
  realizing, Oh my gosh, it's not 2%, it's, it can't be 2%, it's
• 22:51
  3%, it's 4%, it's 5%. And that's what the real risk is
• 22:56
  here. You saw a couple of the Fed
• 22:58
  presidents speak today. One of them came out and said we
• 23:02
  have to try to figure out what's causing the long end of the
• 23:06
  curve to to go up. We just don't understand what
• 23:09
  Why don't people trust us? We know exactly what we're
• 23:12
  saying. We know what the 2% target is.
• 23:14
  We know we're going to achieve that target no matter what.
• 23:17
  Why is the long end of the curve going up?
• 23:19
  Well, the, the long end of the curve that those in the bonds
• 23:21
  are going up because the smart money is saying, yeah, I'm going
• 23:25
  to call your bluff on that. I'm not being compensated
• 23:28
  enough. Three, 3, 1/2% for 10 years is
• 23:31
  not enough. So and then the, the way that
• 23:34
  they get incentivized to buy again is when the yield goes up,
• 23:38
  right. So if you understand that
• 23:40
  process, there's one conclusion that you have to come to, and
• 23:43
  this is the most important thing I'll say all night, the Fed has
• 23:48
  lost the natural ability to attract demand by raising
• 23:54
  interest rates. Because if they raise interest
• 23:57
  rates, sure, the nominal yield is going to go up.
• 24:02
  But actually, because of the way the system works and because of
• 24:05
  the $34 trillion of debt plus $211 trillion of unfunded
• 24:10
  liabilities, plus the ongoing deficit budget, the higher the
• 24:15
  interest rate goes, the larger the deficit.
• 24:19
  The larger the deficit, The more they need to borrow.
• 24:22
  The more they need to borrow, the faster the dollar gets
• 24:26
  inflated or devalued. The faster the dollar gets
• 24:30
  devalued, the faster the real yield drops.
• 24:33
  Right, 'cause real yield is the nominal number minus the percent
• 24:37
  inflation. So if they're printing money to
• 24:39
  pay the yield and then they're the real inflation rate is say
• 24:45
  just say 5%. Forsake of math, it's, it's
• 24:48
  higher than that, but just say right now it's 5%, then you
• 24:51
  would take the 5% that you're getting or the 4.5% that you're
• 24:55
  getting in the 10 year and you would subtract the 5%.
• 24:59
  Well, that's negative, right? If you subtract 2%, you got
• 25:02
  positive yield, you're growing your purchasing power.
• 25:05
  But when you use real inflation, what happens is you figure out
• 25:09
  that the yield is negative, the real yield is negative.
• 25:12
  And the higher they raise the rate, the more inflation they
• 25:15
  cause. The more inflation they cause,
• 25:18
  the higher they have to raise the rate to get people to buy
• 25:21
  the debt. But the higher they raise the
• 25:23
  rate, the more inflation they 'cause.
• 25:25
  That's the death debt circle, and we are stuck in it right
• 25:28
  now. And it's most evident by the
• 25:30
  fact that the Federal Reserve cannot raise rates without
• 25:35
  causing more inflation. Therefore, they cannot raise
• 25:38
  rates to attract smart buyers because the nominal rate goes
• 25:42
  up. But the higher the nominal rate
• 25:43
  goes up, the lower the real yield goes down.
• 25:48
  They have lost control of the yield curve and we need to be
• 25:53
  paying attention. Wow.
• 25:55
  Absolutely incredible. And I I I had a mental picture
• 25:59
  here like just a thermostat, like when they raise the rates,
• 26:03
  the inflation is going up with it.
• 26:05
  And for a time it seemed like they could, you know, control
• 26:08
  that that mechanism. But now any little.
• 26:11
  Twist of the dial, it's like, oh shit, we have broken this.
• 26:15
  And CJ, before you go on guys, if you think CJ is just like
• 26:19
  some random guy on Twitter that you know what you said at the
• 26:22
  beginning, I'm either some idiot or I know what I'm talking
• 26:25
  about. Well, it's not just CJ saying
• 26:27
  this. We have a video here of Jay
• 26:30
  Powell saying the same thing. So it's short and then we'll let
• 26:33
  CJ chime in on this as well afterwards.
• 26:35
  So listen to this guys. Perhaps the most important thing
• 26:38
  is that these higher Treasury yields are showing through the
• 26:41
  higher borrowing costs for households and businesses.
• 26:44
  And those higher costs are going to weigh on economic activity to
• 26:47
  the extent this tightening perhaps the most.
• 26:49
  Important. Oh man, that's a Freudian slip
• 26:53
  right there. Isn't it funny how he mentioned
• 26:56
  it for businesses and families, but he completely just didn't
• 26:59
  say anything about the government.
• 27:01
  Well the government is borrowing more than all the businesses and
• 27:05
  and families. We're it's a multi trillion
• 27:08
  dollar deficit And if the borrowing caught if the higher
• 27:12
  yields are coming through as higher costs for businesses and
• 27:15
  families. Well come on guys it's obvious
• 27:18
  the higher costs are coming through to the to the federal
• 27:21
  government and we know that because if you look at the
• 27:23
  interest rate expense I believe in my tweet we were still under
• 27:29
  a trillion but I just saw a tweet from James Lavish which
• 27:32
  was absolute fire that had the interest rate expense now
• 27:35
  officially over a trillion dollars.
• 27:38
  So we now pay more on our interest in other words the
• 27:43
  deficit becomes larger as a result of our interest payment
• 27:47
  than it does because of our military spending.
• 27:50
  So military we spend more on the military than the whole world
• 27:52
  combined much more but now we spend more on our interest rate
• 27:57
  expense. There it is right there.
• 27:59
  We just broke a trillion dollars and interest rate expense, what
• 28:04
  are we doing? Absolutely J Pound knows it.
• 28:07
  The higher yields are coming through as higher cost.
• 28:09
  The second thing he said was how it's going to weigh down on the
• 28:15
  economy. He just, he just allows people
• 28:18
  to assume that the weighing down on the economy means that the
• 28:22
  economy is going to slow down. But if you guys ever looked at a
• 28:27
  supply demand curve and and you understood how how prices work,
• 28:31
  well then this should be you know, pretty easy to understand.
• 28:34
  I'm going to, I'm trying to simplify it.
• 28:36
  So here we go. If you're a company and you
• 28:38
  create a product and there's a lot of demand on that product.
• 28:41
  Let's say you create like a 1,000,000 units and you just
• 28:46
  launched that product and now like after two weeks you already
• 28:49
  sold half of the amount of units that you produced and the the
• 28:53
  orders keep coming in. Well, you have to, you have to
• 28:57
  stave off demand. You have to find a way to, to
• 28:59
  reduce demand or else you're going to run out of product.
• 29:01
  And if you run out of product, you know, people might go away
• 29:04
  and lose interest. You never want to be able to
• 29:06
  have someone come to your store and click the button and it says
• 29:09
  out of stock, you know they they might not ever come back.
• 29:11
  So what does the company do in order to fight off demand?
• 29:16
  They raise the price. That's that's how you fight off
• 29:19
  demand. So how do you, how does this
• 29:21
  weigh on the economy? This doesn't weigh on the
• 29:23
  economy with lower prices. Look, when a company sends you a
• 29:27
  coupon for 10% or 20%, they're trying to create demand by
• 29:31
  lowering the price, right? So if he was fighting prices and
• 29:35
  lowering prices, he would be making the economy hotter.
• 29:39
  That wouldn't. That's not weighting down the
• 29:40
  economy, that's propping it up. What he's saying is it's going
• 29:44
  to weight down the economy. How does it weight down?
• 29:46
  Well, higher costs pass through the cost structures into
• 29:49
  businesses and families and the government.
• 29:51
  It's going to push prices up. And as those prices get pushed
• 29:54
  up, that's how demand gets dampened.
• 29:58
  So he is literally telling you, verbatim in simple English, that
• 30:04
  what they're doing is causing the prices to go up.
• 30:07
  But at the same time, he's telling you, because the prices
• 30:10
  are going up, I'm going to keep raising those interest rates.
• 30:12
  I'm going to stay higher for longer.
• 30:14
  But because he's staying higher, it it's all feeding, it's it's
• 30:17
  like a negative feedback loop, like the opposite of Bitcoin.
• 30:20
  Bitcoin's got the positive feedback loop.
• 30:22
  This has the negative feedback loop and there's nothing you can
• 30:25
  do or say or there's no lie you can really even tell to get out
• 30:29
  of it because it's just, it's all, it's all math, right?
• 30:32
  This we're showing you math. James here is showing you math.
• 30:35
  He's showing you chart. I'm showing you math in my
• 30:37
  tweets. I'm running the numbers for you.
• 30:39
  Don't believe me? Run the numbers for yourself.
• 30:41
  Math doesn't lie. The it's the narrative pushers
• 30:45
  that need to lie. And he got caught right there.
• 30:48
  He got caught right there revealing the number one problem
• 30:52
  in their strategy, which is we're trying to fight higher
• 30:55
  prices by causing higher prices. Oh man.
• 31:00
  And then this, this leans in perfectly to what you tagged me
• 31:04
  on earlier, this tweet right here.
• 31:06
  You just can't figure it out, can't quite figure out what is
• 31:08
  going on. And you said no one is this
• 31:10
  dumb, It's corruption. So what are these charts?
• 31:12
  What are we looking at Here, let me, let me.
• 31:14
  Or actually, here's the quote tweet guys for you.
• 31:17
  Maybe you guys can see it at the bottom.
• 31:20
  It says Goals B need to work out what's driving long rates up.
• 31:24
  And CJ responds. Just can't quite figure it out.
• 31:26
  Mind blown. No one of this dumb It's
• 31:28
  corruption. Opt out of lying, Hashtag
• 31:30
  Bitcoin. And we got some charts here.
• 31:32
  So explain to us what's going on here, CJ, absolutely.
• 31:35
  So right here is the, the dichotomy between the spending
• 31:40
  and the earning and the blue line is what the government is
• 31:44
  earning and pass the dash line is projected earnings and then
• 31:47
  pass the and projected spending. So what you're seeing here is
• 31:51
  going into 2050 the the government is telling us and and
• 31:55
  this is from the Peterson Foundation, but if you go to the
• 31:59
  Congressional Budget Office, they have this very similar same
• 32:02
  data here. So this is not this is actually
• 32:04
  accurate and it could be found on the CBO or here and spending
• 32:08
  is increasing while revenues are pretty much flatlined.
• 32:12
  So the what that's telling you is that the deficit is going to
• 32:15
  grow. So the government doesn't see
• 32:17
  any problem with spending more money than they collect in
• 32:21
  taxes. They don't understand that when
• 32:23
  you deficit spend new currency units that you borrowed into
• 32:28
  circulation, it creates inflation.
• 32:30
  So they don't understand the consequence of their deficit
• 32:33
  budget and and this chart is showing you exactly why they
• 32:37
  don't understand it. And if they did understand it,
• 32:40
  you would see the red line start to come back below like it did
• 32:43
  in 1998. Red line came below the blue
• 32:45
  line. If they knew what they were
• 32:47
  doing, they would make that red line come below the blue line.
• 32:50
  Instead, the gap is getting wired, the spread is getting
• 32:54
  further and further away. The deficit spending is going to
• 32:57
  continue to increase because this is the Keynesian model.
• 33:00
  This is their Modern Monetary Theory mindset where they
• 33:03
  redefine the how the free market actually works.
• 33:08
  But the free market is now pushing back and saying we're
• 33:12
  going to call BS on your theory and we are going to not trust
• 33:18
  you that you're going to be able to maintain 2% because look at
• 33:21
  what the government's saying, the government is telling us
• 33:23
  they're not going to maintain 2%.
• 33:25
  There's no possible way you can increase spending at that rate
• 33:28
  and have revenues flat lined with an increasing deficit and
• 33:32
  maintain 2% because it's that deficit budget, it's that
• 33:35
  deficit spending that is creating the inflation rate.
• 33:39
  So they're fed Powell is like trying to blame the economy.
• 33:44
  He's trying to blame like the economy is too hot.
• 33:47
  Like we need to. I just need to punish you guys
• 33:49
  because you just won't stop spending.
• 33:51
  You're so strong you know at the same time the most people in in
• 33:55
  ever have two and three jobs. You know, a strong, a strong
• 33:59
  labor economy is not you have to have two or three jobs to get
• 34:03
  by. A strong labor economy is that
• 34:05
  the man can work one job, the wife can stay home and raise the
• 34:08
  kids, and you get to enjoy a high quality of lifestyle and
• 34:12
  and standard of living. That's a strong jobs market.
• 34:15
  A jobs market that requires a person to have three jobs just
• 34:18
  to get by, That's a weak labor market.
• 34:21
  So he's attacking the labor market.
• 34:23
  He's blaming everybody else except the federal government.
• 34:27
  And he's even acknowledging those costs for the businesses
• 34:30
  and the family and just ignoring that fact for the government and
• 34:34
  the fact that it's going to weigh down on us through these
• 34:38
  additional cost structures. Every time you see this red line
• 34:43
  increasing and the deficit increases and inflation goes up,
• 34:46
  that devalues the dollar. That weakens the purchasing
• 34:50
  power of the dollar. Now what's really interesting is
• 34:54
  that gold has maintained its value for thousands of years
• 34:58
  through multiple reserve currency that that have been
• 35:02
  traded against it. Well, the way gold maintained
• 35:06
  its purchasing power was that as the dollar devalued, the cost to
• 35:11
  pull the gold out of the ground went up, right, because the the
• 35:14
  value of the labor, it didn't keep up with inflation, but it
• 35:18
  definitely went up and the value of the equipment and everything
• 35:21
  else that goes into it. As those prices rise, the cost
• 35:24
  for the gold miner rises and the cost for the gold miner.
• 35:27
  When that rises, he needs to raise the front end price.
• 35:31
  And why is that? Well, let's go back to business
• 35:33
  one O 1. Look, if you started a business
• 35:36
  and you don't understand that you need to create profit, you
• 35:39
  should sell your business right away. close down your business
• 35:41
  and sell it. Go get a job.
• 35:43
  Because at least you'll make money, right?
• 35:45
  You don't run a business to not make money, you run a business
• 35:48
  to profit. So if the product or the service
• 35:51
  that you're bringing to the marketplace has a cost, the cost
• 35:55
  is your baseline, the cost. You cannot sell the product or
• 35:58
  service for less than the cost. So if your customer sees the
• 36:04
  value and your good or services value proposition, then they
• 36:08
  must pay a price above the cost or else you're going to go out
• 36:11
  of business. And if you go out of business,
• 36:13
  the supply of that good or service declines and the price
• 36:16
  goes up even higher, right, because that's the way the free
• 36:19
  market works, is the supply drops.
• 36:21
  If the demand's still there, the price goes up.
• 36:23
  So you can't get past this, right?
• 36:25
  This is not the labor theory of value.
• 36:27
  This is Business 101. You offer products and services
• 36:31
  for higher than your cost, and if a competitor can do it
• 36:34
  better, well, that's a different conversation.
• 36:36
  But that cost is is every business's baseline.
• 36:40
  But this is the magic thing about Bitcoin.
• 36:42
  Unlike gold, which value goes up relative to the devaluation of
• 36:47
  the dollar and to the devaluation of the dollar only,
• 36:50
  Bitcoin's price will not protect your purchasing power, only
• 36:53
  because of the devaluation of the dollar, but also because of
• 36:57
  the difficulty adjustment. So imagine more people start
• 37:01
  mining gold and yeah, the supplies get a little bit more
• 37:05
  expensive to buy, so the cost goes up a little bit, but it
• 37:07
  doesn't require any more energy to pull the gold out of the
• 37:11
  ground. With Bitcoin, yes, the price is
• 37:14
  going to go up a little bit because the price of hash rate
• 37:16
  is increasing because the demand on that is increasing.
• 37:19
  But at the same time, as the hash rate increases, the
• 37:22
  difficulty increases, and as the difficulty increases, the cost
• 37:26
  increases. So as we're talking about all
• 37:29
  this stuff, don't get too heavy on yourself, don't get too don't
• 37:34
  let your spirits get low. Because Bitcoin is the solution
• 37:37
  to the very problem that we're talking about today.
• 37:39
  It was strategically engineered to solve this problem, and it's
• 37:45
  here to protect our purchasing power long after this Fiat chick
• 37:50
  coins are are gone. So don't get too low in spirit
• 37:53
  with what's going on, but acknowledge it.
• 37:56
  Acknowledge what's going on. Prepare yourself.
• 37:58
  Prepare your family. Because, look, the government is
• 38:01
  telling you what they're going to do and they're not going to
• 38:03
  change that. Love it.
• 38:05
  Yeah. And we'll we'll ring in.
• 38:06
  We'll bring in Bitcoin into this conversation towards the end.
• 38:09
  But I I think it's very very insightful to just.
• 38:12
  Show people where we are. So, you know, I think he tweeted
• 38:16
  earlier today, You're like, I'm not an alarmist, I'm a realist.
• 38:19
  And sometimes you need a dose of reality.
• 38:21
  But here, let's go to the next chart you tagged us in.
• 38:24
  So what are we seeing in this chart, CJ?
• 38:27
  So, so this one is actually more alarming, but in the red you see
• 38:31
  the, the exponential growth of the of the debt.
• 38:35
  In the green you see declining revenues and in the orange you
• 38:39
  see the increasing deficit. So you know, as the interest
• 38:42
  rates go up, the the revenues are going to go down and the
• 38:48
  debt is going to go up and the deficit is going to go up.
• 38:51
  That is the perfect storm for getting crushed.
• 38:53
  And OPTI, actually, if you could, I'd really appreciate if
• 38:56
  you could pull up the US debt clock, which is usdebtclock.org,
• 39:00
  because I've been watching the US debt clock for close to 14
• 39:05
  years now. And in my recollection, this is
• 39:10
  the only time where we have seen what you're about to see with
• 39:15
  your own eyes. Look right there in the top
• 39:19
  left, you have the debt 33.7, But move over U.S. tax revenue
• 39:25
  yet no zoom back in like that. That was beautiful.
• 39:28
  Yeah. OK, so the national debt is
• 39:31
  going up. The deficit is going up.
• 39:36
  But look what's happening to the revenue it's going down.
• 39:41
  Let me ask Jay Powell question if the if the economy was
• 39:46
  growing by 4.9% because that's what they said GDP was 4.9%.
• 39:52
  How is the tax revenue going down.
• 39:55
  How do you have an economy when you maybe you know maybe even
• 39:59
  better for people to realize this.
• 40:01
  I got you running around here, OP the I apologize, but you're
• 40:04
  good at it, no? Worries.
• 40:05
  No worries. What?
• 40:06
  What do you need? I think going to shadow stats, I
• 40:09
  think if you go to shadowstats.com and we showed
• 40:13
  the GDP sharp, it will kind of give you an idea of how
• 40:17
  ludicrous the claims that that the the Bureau of Labor
• 40:23
  Statistics are putting out the the, the manipulation of the
• 40:26
  data is so bad at this point. That I am actually working on my
• 40:31
  own website that puts together all this because every once in a
• 40:33
  while I sit down and I plug all these numbers into the equations
• 40:36
  just to see where we're at. And I'm getting annoyed with it.
• 40:38
  So I want to automate the process and I'm going to create
• 40:41
  that website so that everybody has access to the most important
• 40:45
  numbers that any macro manager can have access to.
• 40:48
  And when you get that up on the GDP on shadow stats, what we're
• 40:54
  going to see is that the government is claiming with 4.9.
• 40:58
  Percent GDP that we're not just growing faster than we were pre
• 41:04
  COVID, we're going, we're growing faster than we were
• 41:07
  going all the way back to the early 80s.
• 41:11
  So they're saying that this is the most growth and I'm still
• 41:13
  seeing the debt clock. I'm not sure if everybody is
• 41:14
  still, yeah, here we go. I'm I'm trying to find it on the
• 41:17
  site. Yeah.
• 41:18
  So go to alternate data. Yeah, that's fine.
• 41:22
  Yeah. And then gross domestic product,
• 41:24
  there we go. Boom.
• 41:26
  So the blue line. Is actually accounting for real
• 41:29
  inflation. The red line is what the
• 41:32
  government claims. We'll take a look at where that
• 41:35
  red line they're saying that we're at 4.9%.
• 41:39
  That's more growth than pre COVID of course, but that's more
• 41:42
  growth going all the way back to the early 80s.
• 41:45
  They're saying we have these after doing the largest, most
• 41:48
  aggressive interest rate hike in in modern financial history.
• 41:53
  They're saying we have the strongest economy.
• 41:56
  Because the data is is botched. Inflation is not being accounted
• 42:00
  for properly. When you look at GDP, they're
• 42:02
  supposed to just like when you find real rates, right?
• 42:05
  When we talked about real rates the the nominal rate is 5.5%.
• 42:10
  If we believe the Fed and the and the inflation rate is 2%,
• 42:13
  then our real rate of return is the 5% minus the 2% which is the
• 42:18
  3.5%. Well, in GDP it works the same
• 42:22
  way you you have what's called the GDP deflator.
• 42:25
  And that and that's how you go from nominal to real.
• 42:29
  So they're saying that GDP is 3.5%.
• 42:33
  So they're deflating GB GDP by 3.5%.
• 42:37
  But inflation is not 3.5%. So that's why the that's why the
• 42:41
  GDP number is the nominal number that they're promoting to to
• 42:45
  promote. Their narrative is telling us
• 42:47
  that we have the strongest economy since the early 80s.
• 42:50
  That's just not true, because when you account for real
• 42:53
  inflation, look at the blue line.
• 42:56
  Growth is still negative. We have.
• 42:58
  We have only shrunk less and less since COVID.
• 43:02
  We have not experienced any real growth.
• 43:05
  Now a lot of people know that the definition of a recession is
• 43:09
  2 consecutive quarters of negative GDP.
• 43:13
  Well, the definition of a depression is 1/4 of greater
• 43:20
  than -10% GDP or? 12 consecutive quarters of
• 43:26
  negative GDP. Well, you'll see there.
• 43:28
  In 2020, we went just below the 10%.
• 43:32
  So in 2020, we actually entered and fit into the definition of a
• 43:37
  depression. Now of course, it was an
• 43:39
  artificial depression based on the lockdowns, but we met that
• 43:43
  definition. Now what's concerning is that we
• 43:47
  we met the definition of an artificial depression through
• 43:50
  the lockdown which brought us the -10%.
• 43:53
  But since then, we have not been positive.
• 43:55
  We've been shrinking less and less, absolutely, because we're
• 43:58
  recovering, but we've never gone positive.
• 44:01
  And if GDP doesn't turn positive by the end of this quarter, this
• 44:06
  is the 12th quarter. So we will have met the United
• 44:09
  States of America will have met both definitions of a
• 44:12
  depression, both at least one year of negative of greater than
• 44:17
  -10% GDP plus 12 consecutive quarters.
• 44:22
  Of negative GDP. Meanwhile, the government is
• 44:26
  telling you we have the strongest economy since the
• 44:28
  early 80s. The, the, the, the mishandling
• 44:32
  of inflation is what's skewing all of the data.
• 44:36
  So then you have to ask yourself, OK, well are they
• 44:38
  botching this or are they incentivized to do this?
• 44:43
  Well, everybody in Bitcoin knows that Funny scammer saying where
• 44:47
  it's like, hey, send me a Bitcoin, I'll send you 2 back,
• 44:50
  right? Have you ever heard a scammer
• 44:52
  tell you, hey, send me one Bitcoin and I'll send you 0.95
• 44:57
  back? Well, hell no, they never said
• 44:59
  that because there's no incentive for the person to send
• 45:01
  the Bitcoin. Why would I send you one Bitcoin
• 45:03
  to get less back? I want more back.
• 45:06
  Well, the government. In the same way, the government
• 45:08
  is incentivized to tell you a lower inflation number, right?
• 45:13
  Because when they tell you a lower inflation number, that's
• 45:16
  the equivalent of creating a fake.
• 45:20
  Real yield. That's higher than it really is,
• 45:22
  right? Because you take the 5% that you
• 45:24
  get on the three month, you subtract it from their 2% claim
• 45:28
  and you got real growth of 3% year over year.
• 45:32
  But if you take the 5% and you subtract the 7 1/2% real
• 45:37
  inflation, you're at negative. So why would we lend the
• 45:41
  government money and and expect to get a negative return?
• 45:44
  Why would we send the Bitcoin scammer of Bitcoin?
• 45:46
  Because he promised to give us 0.95 Bitcoin back.
• 45:50
  Right. The Federal Reserve is not,
• 45:52
  they're smarter than that. So they're they're, they're,
• 45:55
  they're incentivized to to state a lower inflation number because
• 46:00
  the lower inflation number allows you to subtract a smaller
• 46:05
  number from the nominal yield which fluffs up the real yield
• 46:09
  number. And and and because they have
• 46:13
  that incentive, people really shouldn't be trusting their data
• 46:16
  a lot. Like why you shouldn't have
• 46:18
  trusted. A lot of the VAX data that it
• 46:22
  was safe, it was tested. I mean the right amount of time
• 46:26
  didn't pass by to do the proper testing.
• 46:28
  So it's it's unfair to say that it was safely and properly
• 46:31
  tested because the right amount of time didn't even go by to do
• 46:34
  the right safe and proper testing.
• 46:36
  It's just obvious. But they had incentive to lie
• 46:39
  about it because they made billions of dollars.
• 46:41
  Well, the government has an incentive to lie about the
• 46:43
  inflation because as long as they can make us think that we
• 46:46
  have a real yield, a real rate of return that's positive and
• 46:51
  not negative, then we'll keep lending them money.
• 46:54
  And that's what the market is figuring out.
• 46:56
  The market is starting to figure out.
• 46:58
  This is unbelievable. They've been telling me this,
• 47:01
  but the reality is this. And when I switch, when I adjust
• 47:04
  to the reality, I'm actually sending this guy a Bitcoin and
• 47:07
  getting 0.95 back. This is not going to work.
• 47:11
  I don't want to lend my money to them.
• 47:12
  And people are selling the debt because the debt is being
• 47:15
  devalued, because the people are waking up to the fact that the
• 47:19
  the data is not accurate and it's not just, you know, that's
• 47:22
  why the inflation number is so important.
• 47:25
  If anybody ever asked why are they so focused on inflation,
• 47:29
  inflation, inflation, because inflation plugs into everything.
• 47:32
  It plugs into real GDP, It plugs into real yields.
• 47:36
  It plugs into real sales. It's the inflation.
• 47:38
  Is the number that you subtract. From the nominal sales or GDP or
• 47:43
  yield to get the real number. So they're they want to
• 47:46
  manipulate the real number and in order to manipulate the real
• 47:49
  number. It's not it's not just about
• 47:51
  manipulating the nominal yields, it's about manipulating the
• 47:55
  deflator that you use the inflation number that's
• 47:58
  subtracted from that nominal number that gives the real
• 48:01
  number and that's that's where the marketplace incentives come
• 48:04
  from. So if if real yields are
• 48:07
  positive. And you can grow your purchasing
• 48:10
  power over time, then the marketplace is incentivizing you
• 48:14
  to save, right? If you can grow your purchasing
• 48:17
  power over time, then it makes sense to save, not to spend or
• 48:21
  invest. Save, because you can buy more
• 48:23
  tomorrow. But when the real rate of return
• 48:25
  is negative, the marketplace is incentivizing you to spend or
• 48:30
  invest because you're going to be able to buy less tomorrow.
• 48:33
  You'll be able to buy less food, smaller house, less shares of
• 48:37
  the company. Because the real rate is
• 48:38
  negative and it incentivizes you to spend or vest when the real
• 48:43
  rate is negative. So that's what's that's the
• 48:46
  breaking apart of the market right now.
• 48:48
  Some people in the market, you got the Ray Dalios and some some
• 48:52
  of these bigger guys coming out the Paul Tudor Jones and they're
• 48:55
  coming out and saying hey, we're not being compensated enough for
• 49:00
  this. So we don't want to hold, we
• 49:01
  don't want to hold the debt. Because the real rate of
• 49:03
  inflation is actually higher than what they're saying.
• 49:06
  Therefore my real yield is negative.
• 49:10
  Therefore I'm going to spend or I'm going to invest.
• 49:13
  I'm not going to save because I'm not gaining any purchasing
• 49:16
  power. I'm sending one Bitcoin and
• 49:18
  getting 0.95 back. I want to send one Bitcoin and
• 49:20
  get 1.1 Bitcoin back. I I need to increase my
• 49:23
  purchasing power, not decrease it.
• 49:26
  So that's what's really going on here with the manipulation of
• 49:29
  the inflation data. And that's why the focus is on
• 49:32
  the inflation data because it plugs into everything else in
• 49:36
  order for the marketplace to determine what those incentives
• 49:39
  are. And half the marketplace or
• 49:42
  maybe 3/4 of the marketplace believes the Fed and thinks the
• 49:45
  the rate is positive. And that's the $21 billion that
• 49:49
  piled into TLT, plus literally trillions of dollars that was
• 49:53
  lent directly to the government. And then the other half is
• 49:56
  saying, well, real yields are negative.
• 49:58
  So I'm not. I'm not going to lend my money.
• 50:00
  I'm going to spend it or invest it because I'll get more today
• 50:03
  than I will tomorrow. And that's where we that's where
• 50:05
  the marketplace is right now and it and we're on the brink.
• 50:09
  We are, we are on the brink of more people realizing it than
• 50:12
  not. And that's when everything will
• 50:14
  shift. That's the catalyst.
• 50:16
  Absolutely incredible. CJ, before I reel this back into
• 50:20
  Bitcoin, we are almost at the top of the hour.
• 50:22
  I told everyone we might go along.
• 50:23
  Me and CJ were chuckling about it.
• 50:25
  You did this tweet the other day and we've been constantly
• 50:28
  harping on a similar idea and you just kind of doubled down on
• 50:31
  it. We've been saying for a while on
• 50:32
  the show that World War Three is an information war and here you
• 50:35
  have a tweet. World War Three is an economic
• 50:38
  war and it's being fought in the field of finance.
• 50:40
  So maybe tie all this together. How does this relate in the
• 50:43
  global geopolitical sense of the words?
• 50:46
  And then we'll give some people some relief and talk about how
• 50:49
  Bitcoin fixes this. Yeah, absolutely.
• 50:52
  So the whole, the whole goal, see this is what I call the the
• 51:00
  Fiat perpetual war cycle and what happens is that the the
• 51:06
  currency marketplace, the FX marketplace, what it allows
• 51:09
  countries to do. Is to issue their debt and
• 51:12
  ultimately what that does is it creates demand for dollars.
• 51:16
  So basically because of dollar denominated debt, there's almost
• 51:21
  an unlimited bid on dollars. So what that does is at some
• 51:26
  point in time or another that demand hits the dollar.
• 51:29
  When the demand hits the dollar, DXY goes up.
• 51:32
  Well, when DXY goes up the the Treasury can issue more debt.
• 51:38
  And yeah, it'll make DXY go down, but it's really just
• 51:41
  offsetting the positive pressure that was created through all the
• 51:44
  dollar denominated debt. So if you keep going through
• 51:47
  that process, you you can fund war perpetually right because
• 51:51
  the country will issue a issue a treasury or a debt note and use
• 51:55
  that money to pay for the war and they'll issue it in the in
• 51:59
  the imagine, there's the FX market, it's the currency
• 52:02
  market. It's like, it's like Bitcoin.
• 52:03
  It's its own marketplace well. Governments have currency
• 52:07
  markets that are their own marketplace, and Fiat makes it
• 52:10
  possible. So the entire Fiat system is
• 52:13
  based on war. But what we're seeing right now
• 52:16
  is a World War between the parties within that system.
• 52:20
  So we have a perpetual war system, and then we have the
• 52:23
  parties within that system now fighting and jockeying for a
• 52:26
  position with each other. And the whole name of the game
• 52:29
  is for bricks who could never. Never beat the dollar.
• 52:34
  I mean I don't care what bricks does, there's nothing that they
• 52:37
  can do. Even if they back their currency
• 52:38
  with gold, it's not going to be it's not going to threaten the
• 52:41
  dollar because countries aren't issuing debt that creates demand
• 52:45
  on bricks currency. It's dollar denominated debt.
• 52:48
  And yeah this is, this is a just to show you a lot of people say
• 52:53
  that DXY, if you notice in 2021 we had all time high inflation,
• 52:58
  right. But what was the dollar doing?
• 53:00
  It went up. It went up.
• 53:02
  Look, when the Fed started raising interest rates, well,
• 53:04
  have they stopped raising interest rates?
• 53:06
  No. But look at the channel that we
• 53:08
  were in. Up until recently it was going
• 53:10
  down. So we had disinflation or we had
• 53:12
  inflation at a slower rate and DXY went down.
• 53:16
  Be careful out there here to listen to who's who's people
• 53:18
  that use DXY to try to see what price trends are going to happen
• 53:22
  for assets or what's going to happen with inflation.
• 53:25
  Because, you know, when the dollar went up, you'd think
• 53:27
  prices would go down, but at the same time the dollar went up.
• 53:31
  We had all time high inflation and then starting in October,
• 53:35
  something happened, the trend changed and we had disinflation,
• 53:39
  right. Official inflation went down
• 53:41
  from 9 all the way down to where we are now, but the dollar went
• 53:43
  down too. So you have to be careful where
• 53:46
  you're looking at here. And that neckline there is the
• 53:48
  head and shoulders pattern and we and actually the updated
• 53:51
  chart is we've broken below that.
• 53:52
  So the dollar is getting a little bit weaker right now and
• 53:56
  I think that's because people are anticipating that they're
• 53:58
  going to lower rates, but. They're not going to lower rates
• 54:01
  because they're they're trying to fight the prices, right.
• 54:03
  So that goes back to the original conversation we had.
• 54:06
  And as they're fighting those rates, they're issuing
• 54:09
  treasuries. The rest of the world, the World
• 54:12
  War Three, is economic and being fought in the field of finance
• 54:15
  because the rest of the world sees what's happening and is
• 54:18
  saying, well, we can't beat the dollar, but what we can do is we
• 54:21
  can reduce the amount of demand on the dollar.
• 54:24
  And that's really their strategy.
• 54:25
  Their goal is let's reduce the amount of demand on the dollar.
• 54:30
  And as they reduce the overall amount of demand on the dollar,
• 54:34
  slowly but surely like a war of attrition and at the same time
• 54:38
  the United States government is increasing the supply.
• 54:42
  Well look the the natural laws of economics that apply equally
• 54:46
  all over the world tell us that when supply goes up and demand
• 54:49
  goes down, price goes down. So yields are going to
• 54:53
  skyrocket, yields are going to go up because as the as the note
• 54:55
  and bond prices go down because the supply is going up.
• 54:58
  At the same time, the demand is going down the bond and no
• 55:01
  prices are going to go down, which pushes the yield up.
• 55:04
  So there's really nothing that they can that they can do except
• 55:10
  control the narrative and maintain people's trust.
• 55:13
  And that's why I think it's important for people to start
• 55:15
  talking about Financial COVID, because we have a data problem
• 55:19
  here and if we can fix this data problem.
• 55:22
  Like a fallen Angel standing in front of God, we'll be able to
• 55:26
  see through the facade. We will be able to see that that
• 55:29
  is not a real Angel, it's a fallen Angel.
• 55:31
  We'll be able to see that the the economy is not that strong.
• 55:34
  We're actually we were in an artificial depression.
• 55:38
  We're since then we've been in recession and by the end of the
• 55:42
  year if GD, if real GDP doesn't turn positive we will be in a
• 55:46
  real depression. And then the next the next step
• 55:49
  of that is. Well, are they going to let
• 55:51
  everything fall apart? They're not going to let
• 55:54
  everything fall apart. If they were going to let
• 55:56
  everything fall apart, it would have already fell apart in
• 55:58
  March, right? The banks are already bankrupt.
• 56:02
  Everybody's sitting around like, oh, everything's OK.
• 56:04
  Nothing crazy happened. The banks are bankrupt.
• 56:07
  Your money's gone. They took your money, they went
• 56:10
  out the yield curve. And then and then all of that
• 56:13
  mark to market value is gone. So they have a couple of
• 56:15
  accounting trips where where Oh well we're not going to sell
• 56:18
  that 30 year bond until we have to.
• 56:21
  So it's so we mark it down as a whole to maturity value.
• 56:24
  So yeah, even though it's a billion dollar bond and right
• 56:27
  now it's only worth 600 million. Well we we don't care on our
• 56:33
  book, it's still worth a billion on our book.
• 56:36
  That bond is still backing 1 billion dollars of our customers
• 56:40
  deposits. Right.
• 56:41
  So in March when the customers came back and said, hey, we want
• 56:43
  our money because you're paying us 0.1% and this money market
• 56:48
  fund is going to offer me 5%. So I want my money, I want to
• 56:52
  take my money over to them where I can get 5 instead of 0.1.
• 56:55
  Well, the banks where they supposed to get the money, they
• 56:58
  have to sell the collateral, the the not pristine collateral that
• 57:02
  lost all its value, they have to sell it.
• 57:04
  Well, they have to sell it at a loss, right.
• 57:06
  So hold to maturity, Accounting only works until it doesn't.
• 57:10
  And that's why the Federal Reserve, if they were going to
• 57:13
  let everything D lever, if they were going to take the leverage
• 57:16
  out of the system, if we were going to experience deflationary
• 57:19
  price action, it would have happened in March because they
• 57:22
  would have never created the bank term funding program.
• 57:24
  The Bank term funding program from the Federal Reserve said.
• 57:28
  Hey guys, we know that you need the money for for your asset in
• 57:33
  order to cover your customers deposit liabilities.
• 57:37
  And we also understand that if you took that asset and went to
• 57:40
  market, you would, you would go bankrupt, you're insolvent.
• 57:43
  So in order to keep you from failing, you can just bring that
• 57:47
  collateral to us and we're going to pretend that it's pristine,
• 57:51
  we're going to pretend that it's, it's par value.
• 57:55
  So yeah, that bond that you paid a billion dollars for is now
• 58:00
  only worth 600 million. But if you come to us?
• 58:04
  We'll let you borrow from that. We'll let you, you use it as
• 58:06
  collateral and we'll value it at par.
• 58:08
  We'll value it at the billion. That way the bank could get the
• 58:11
  full billion that they needed to give to their customers.
• 58:14
  So they could go where they wanted to go.
• 58:17
  And that bank term funding program is the proof that if
• 58:20
  they wanted the system to delever, if they wanted to
• 58:22
  create a deflationary scenario, then that's when they would have
• 58:25
  let it happen. But they didn't.
• 58:27
  They created the program and they they maintained the status
• 58:30
  quo. And a lot of people say, well,
• 58:32
  what's that mean? CJ Like what?
• 58:34
  How can they do that? How is this happening?
• 58:36
  Why is it happening? That's because we don't live in
• 58:39
  a democracy anymore. We we had a Republic.
• 58:42
  It devolved into a democracy, and then it devolved into
• 58:46
  kleptocracy. And for people who don't know, a
• 58:48
  kleptocracy is simply a body of power elites who fight over the
• 58:54
  power of the purse. Right, because the government,
• 58:57
  through a vote, has the right to create money.
• 59:00
  They can print money out of thin air.
• 59:01
  And unfortunately, that's where we are right now.
• 59:03
  The politicians don't care about the people.
• 59:05
  They care about the people who pay their bills and get them
• 59:09
  elected and donate to them. So when they get those donations
• 59:13
  and they get that backing, they have a they make a promise to
• 59:16
  that person. Oh yeah, sure, no problem.
• 59:17
  We're going to get money for solar panels.
• 59:19
  We're going to do this. We're going to do that.
• 59:20
  And then when they get to DC, they talk to other politicians
• 59:23
  that say, well, look, I don't really give two craps about your
• 59:26
  constituents and you don't really give two craps about my
• 59:29
  constituents. But we have one thing in common.
• 59:31
  Your constituents need money and my constituents need money.
• 59:34
  So if you support me, I'll support you.
• 59:37
  That's how you get multi thousand page bills with all
• 59:40
  this different stuff. You'll you'll notice there's
• 59:42
  never a bill that passes with just one thing in it because not
• 59:46
  everybody in cares about that one person or that one thing.
• 59:49
  What they care about has to be included into the bill.
• 59:52
  So thousands of cares are are forced into these bills so that
• 59:56
  everybody gets a a piece of the treasure pot, a a piece of the
• 1:00:00
  Piggy Bank. No one person can get a piece of
• 1:00:03
  the Piggy Bank if you're going to reach in the Piggy Bank.
• 1:00:05
  We're all going to reach in the Piggy Bank at the same time and
• 1:00:08
  and that's how it works. So it's a kleptocracy.
• 1:00:11
  It's about a group of power brokers who have access to the
• 1:00:16
  printers basically and they sell that access to the printer and
• 1:00:20
  and. That's really where we're at
• 1:00:22
  right now. I don't think they want to
• 1:00:24
  destroy the system. I don't think they they want to
• 1:00:26
  do some big reset. I don't.
• 1:00:29
  I don't think they're that organized, or at least I hope
• 1:00:32
  and pray they're not that organized.
• 1:00:33
  I think it's just kleptocracy. It's everybody looking out for
• 1:00:37
  themselves to maintain the the status quo.
• 1:00:39
  Because as long as they can maintain the status quo, they
• 1:00:43
  all get to keep picking out of the Piggy Bank, right?
• 1:00:46
  If everybody's happy, even if we, even if we create some
• 1:00:48
  inflation, even if whatever the consequences are, they don't
• 1:00:52
  care. Because it's about maintaining
• 1:00:54
  the status quo, because the status quo is what allows them
• 1:00:57
  to keep picking from the Piggy Bank.
• 1:01:00
  If we adopt Bitcoin, if we the people step up and say we're not
• 1:01:03
  going to let you pick from the Piggy Bank anymore, well how are
• 1:01:05
  we going to do that? Are we going to do that?
• 1:01:07
  Violently? No, of course not.
• 1:01:09
  Most of us have families and kids and we just want to live
• 1:01:12
  life peaceably. We don't.
• 1:01:13
  We're not interested in in violence.
• 1:01:15
  Bitcoin is a peaceful revolution.
• 1:01:18
  And the and the reason is is because the way Bitcoin is
• 1:01:21
  created. It takes away their ability to
• 1:01:23
  raid the Piggy Bank, right? They can only ever spend what
• 1:01:27
  they collect in tax, They can't spend more and they can't create
• 1:01:32
  more Bitcoin and spend it into circulation.
• 1:01:34
  It takes away the power of the purse.
• 1:01:37
  It gets rid of this kleptocracy and gets those politicians back
• 1:01:41
  into the mindset of being a servant to We the people rather
• 1:01:45
  than stealing through inflation from We the people.
• 1:01:49
  And that's what that's why Bitcoin is the solution to the
• 1:01:52
  inflation problem. It takes away the power of the
• 1:01:54
  purse. And that's what's most important
• 1:01:56
  in a kleptocracy like we have today, the power of the purse.
• 1:02:00
  So the status quo is going to remain.
• 1:02:02
  They're always going to take the politically expedient solution
• 1:02:06
  because it maintains the status quo.
• 1:02:08
  Nobody wants to do the tough and right thing and let companies
• 1:02:11
  fail, right? Too big to fail.
• 1:02:13
  Where did that come from? Too big to fail came from well,
• 1:02:16
  shit, if they're too big to fail and then they actually fail, we
• 1:02:19
  lose the status quo. So we got to do what we we got
• 1:02:22
  to do to maintain the status quo.
• 1:02:24
  And in 2008 it was, it was pretty bad.
• 1:02:27
  But since COVID, it's it's it's it's gone to a whole nother
• 1:02:32
  level. It's gone to, I think, the
• 1:02:34
  dollar supply. Nobody really knows for sure,
• 1:02:37
  but based on my research, since 2020 the dollar supply has been
• 1:02:41
  expanded upwards of 80%. So it's no no rhyme or reason or
• 1:02:47
  wonder why prices keep going up. Even if even if inflation has
• 1:02:51
  gone down from 9% to 3.7%, that doesn't mean the prices went
• 1:02:55
  down. That means the prices are still
• 1:02:57
  going up. They're just going up a little
• 1:02:58
  bit slower. And the reason they're going up
• 1:03:00
  a little bit slower is because they raised interest rates and
• 1:03:02
  when they raised interest rates, the dollar gained a little bit
• 1:03:05
  of strength in there, right? So there was a, there was a
• 1:03:07
  temporary reprieve through the effects of raising interest
• 1:03:10
  rates. But now those effects are going
• 1:03:12
  away because they've, they've reached a cap, they've reached a
• 1:03:14
  limit on interest rates. And I think one more thing to
• 1:03:18
  kind of put the final nail in the coffin here, I have a tweet
• 1:03:21
  about a yield curve normalization.
• 1:03:24
  And I I want people to understand that because that's
• 1:03:27
  the signal I'm watching every morning.
• 1:03:29
  I look up and I look at the 10 year to three month yield curve
• 1:03:33
  because I know that once that yield curve normalizes.
• 1:03:38
  Is it? Is it this one?
• 1:03:39
  Let me see simply can't emphasize the doubt.
• 1:03:48
  How important you see your credit version.
• 1:03:49
  Let me see. Can you Scroll down a little
• 1:03:50
  bit? Because it's.
• 1:03:51
  I go by the. No, it's it's not that one.
• 1:03:58
  OK, I'll find it. It's, it's, it's got a, let me
• 1:04:04
  just describe what the normalization process is.
• 1:04:07
  So like we talked about earlier, while you're looking for that,
• 1:04:10
  the process of normalization is the long term rates going back
• 1:04:14
  above the short term rates, right.
• 1:04:17
  And actually to this day we've had the longest, steepest yield
• 1:04:22
  curve inversion between the 10 year treasury note and the three
• 1:04:26
  month treasury bill and it's recorded history.
• 1:04:29
  So what that's telling you is the marketplace has trusted the
• 1:04:33
  Fed, they trusted the Fed so much that it created the longest
• 1:04:38
  and the steepest yield curve inversion and it's recorded
• 1:04:41
  history. But if you go back and you look
• 1:04:43
  at the chart and and on that chart OPTI, it's like the 10
• 1:04:47
  year minus the three month. It's a Fred chart, there's two
• 1:04:50
  red lines. I talk about normalization and
• 1:04:55
  the there's what's called a interest rate spread, right.
• 1:04:58
  So it'll be the the difference between the three month bill
• 1:05:00
  rate and the 10 year note rate. Well, historically once the
• 1:05:05
  yield curve UN inverts the spread between the 10 year and
• 1:05:09
  the three month, it ranges between 2 and 4%.
• 1:05:14
  Well that's really important because right now the three
• 1:05:17
  month bill is at 5 1/2%. So if we get a normalization, in
• 1:05:22
  other words if the if enough people say I don't believe
• 1:05:25
  you're 2% inflation target, the Federal Reserve starts to lose
• 1:05:29
  control of the long end of the yield curve.
• 1:05:31
  Like in that one tweet his comment was trying to figure out
• 1:05:35
  what's happening with the long end of the curve.
• 1:05:37
  Can't just figure it out because he can't say out loud, oh people
• 1:05:40
  are starting to lose trust in US.
• 1:05:41
  People are starting to question our 2% target and as they
• 1:05:44
  question 2% target those yields have to rise because those
• 1:05:48
  people are looking for to be incentivized and to be
• 1:05:51
  incentivized the real rate has to be positive.
• 1:05:53
  So those yields have to keep going up.
• 1:05:55
  Well with the three month bill at 5 1/2%, if normalized the 10
• 1:06:03
  year would go all the way up. Yeah.
• 1:06:05
  So you could see the 10 years, the candles the three.
• 1:06:08
  The three month is the green line.
• 1:06:11
  If the if the candles go above the green line and the 10 year
• 1:06:14
  rate goes above the green rate, the historical spread.
• 1:06:18
  In other words, there's going to be a crash.
• 1:06:19
  Treasuries will sell off so fast that it will be hard to
• 1:06:24
  comprehend and and the IT will be 2 to 4%.
• 1:06:27
  So 5.5% + 2% is 7 1/2% and 5.5% + 4% right?
• 1:06:34
  For because that's the spread. 2 to 4% is 9 1/2%.
• 1:06:37
  So you'll see the 10 year note post normalization shoot to 7
• 1:06:43
  1/2 all the way up to 9 1/2%. And remember about what we first
• 1:06:47
  talked about, the higher the rate goes, the larger the
• 1:06:51
  deficit. The larger the deficit, the more
• 1:06:53
  they need the print. The more they print, the larger
• 1:06:55
  the inflation number. The larger the inflation number,
• 1:06:57
  the more real yields go negative.
• 1:07:00
  So this is the debt, debt spiral that people are waking up to and
• 1:07:04
  that what you want to keep an eye on is actually OPTI.
• 1:07:08
  I know you can pull this up fast if you.
• 1:07:09
  If you pull up a tab and just type in Fred, Fred, 10 Year -3
• 1:07:16
  month and click enter, it should be the top result.
• 1:07:20
  And we'll be able to everybody will be able to at least
• 1:07:22
  visualize it and see what I'm talking about here.
• 1:07:26
  Because what this, this chart does.
• 1:07:28
  Yeah, beautiful. Now just zoom it all the way
• 1:07:29
  out, like at the bottom. Pull that.
• 1:07:31
  Yeah, go straight down. Pull that thing there all the
• 1:07:33
  way up There we go, OK. So what you'll see is, and
• 1:07:39
  actually what I want you to do is, is is pull that same bar
• 1:07:42
  back so that I can show people there that very first thing
• 1:07:44
  actually did go. So not that one, the one on the
• 1:07:46
  right. Pull that one on the right all
• 1:07:48
  the way back to like 1985, all the way back.
• 1:07:51
  Keep going, keep going, keep going.
• 1:07:52
  Good. OK.
• 1:07:54
  See how the see how the rate went.
• 1:07:55
  It did go negative there. So I just wanted people to, I
• 1:07:57
  don't want people to be like, hey, CJ, that didn't what you
• 1:08:00
  said wasn't true. No, there was an inversion and
• 1:08:02
  then there was recession. OK, So now you can zoom it all
• 1:08:04
  the way back out. I don't know why it does that.
• 1:08:07
  Because you know why the government can't even code
• 1:08:09
  charts, that's why. But it doesn't look like it was
• 1:08:11
  inverted there, but it was inverted there.
• 1:08:13
  So you have the inversion, the normalization, recession, and
• 1:08:16
  then in the in the 90s there, inversion, normalization,
• 1:08:19
  recession. The great Gray shaded areas are
• 1:08:22
  the recessions. Then in 2000, inversion,
• 1:08:25
  normalization, recession, inversion, normalization,
• 1:08:29
  recession. And then COVID, inversion,
• 1:08:31
  normalization, recession. So right, now look how steep
• 1:08:36
  that inversion was. That was the steepest inversion
• 1:08:40
  in the history of the recorded relationship between the 10 year
• 1:08:43
  and the three month. Now if you measure the amount of
• 1:08:46
  time of these inversions, right now we are in the longest
• 1:08:51
  lasting inversion in the recorded history of the 10 year
• 1:08:54
  and the three month. What does that mean?
• 1:08:56
  That means that the market has trusted the Fed.
• 1:08:59
  But what the Fed officials came out and said today is we can't
• 1:09:02
  understand this big V shape here.
• 1:09:04
  We don't understand why we're getting this V shaped design and
• 1:09:07
  we're heading back towards the zero line.
• 1:09:08
  Why are we heading towards normalization?
• 1:09:10
  Why are long term yields going up?
• 1:09:13
  Well, because the free market is calling your bluff.
• 1:09:15
  The free market is saying inflation isn't 2%.
• 1:09:17
  Therefore, in order for me to continue to lend to you, I need
• 1:09:20
  higher rates of return and they're going to sell that debt
• 1:09:23
  until it gets to the point of that rate of return being real.
• 1:09:28
  But then if they really know how to do the math, they're going to
• 1:09:31
  understand, Oh my God, when it goes up to 7 1/2 to 9 1/2%,
• 1:09:35
  well, the number I have to subtract from that 7 1/2 percent
• 1:09:39
  is going to be larger than what it is now.
• 1:09:41
  It can never get positive. They will never be able to make
• 1:09:44
  real yields positive. That is like the biggest piece
• 1:09:50
  of news that nobody is talking about.
• 1:09:52
  There's no way, because of the $34 trillion of debt, the 211
• 1:09:58
  trillion of unfunded liabilities that all need to be financed and
• 1:10:01
  rolled over, plus the ongoing deficit budget that they plan to
• 1:10:04
  continue to grow, there is no way to get the real yield to be
• 1:10:09
  a positive number. There's no way they're stuck.
• 1:10:13
  And this is what people need to understand.
• 1:10:14
  And once they do, it's you're not going to be able to get out
• 1:10:20
  of the dollar fast enough. You're going to see a crash.
• 1:10:23
  You're going to see yield shoot up to double digits and not just
• 1:10:26
  1015%, they're going to go Weimar level 2030% yields.
• 1:10:31
  And unfortunately, some people will still get suckered in, but
• 1:10:34
  look no further than Argentina to understand that even if you
• 1:10:38
  put the interest rate above the rate, I think their interest
• 1:10:41
  rate is like 136%. But they're real.
• 1:10:45
  Now the government inflation rate is smaller.
• 1:10:47
  It's like 110%. But that's a lie.
• 1:10:48
  They're lying about their inflation rate too.
• 1:10:50
  Real inflation in Argentina is closer to like 200%.
• 1:10:54
  So it doesn't matter how much you raise the rate, you can
• 1:10:56
  literally be paying people 136% APY and it wouldn't matter
• 1:11:01
  because you're paying the APY with diluted tokens, with
• 1:11:05
  diluted Fiat currency coins that that have no real.
• 1:11:09
  You can't create value out of thin air, right.
• 1:11:11
  So they steal their value from all the existing tokens.
• 1:11:14
  That increases the inflation rate and lowers the real rate.
• 1:11:18
  That's where we are right now. That's what's important for
• 1:11:20
  people to understand. And if I were you, I would be
• 1:11:23
  keeping a eagle eye on the 10 year note rate minus the three
• 1:11:29
  month bill rate because when that normalizes that will be the
• 1:11:33
  catalyst to long term yields skyrocketing and then investors
• 1:11:38
  having to ask what the what the hell just happened, How did this
• 1:11:41
  just happen and what are the consequences and what are the
• 1:11:44
  real numbers, right, Because nobody, nobody really paid
• 1:11:47
  attention to, they're forced to pay attention.
• 1:11:49
  Just like nobody really cared that the banks were insolvent
• 1:11:51
  until people wanted to move their money from the banks to
• 1:11:53
  the money market funds. Then it mattered.
• 1:11:55
  Well, very soon it's going to matter that they don't have
• 1:11:58
  control of the yield curve. And if they try to do yield
• 1:12:01
  curve control, money printing, right, more inflation there.
• 1:12:05
  There's one solution. They have inflation, inflation,
• 1:12:08
  inflation, inflation, inflation. Not deflation, right.
• 1:12:10
  Everybody on the sidelines waiting in their money, waiting
• 1:12:13
  for deflation. We are in an inflationary
• 1:12:15
  recession. Remember the GDP chart?
• 1:12:18
  We're in a recession right now. We are about to be in a we're,
• 1:12:22
  we're in an artificial depression.
• 1:12:23
  I'm giving them that, OK, that -10 was because of lockdown.
• 1:12:26
  It's artificial, but real rate is negative.
• 1:12:29
  The real growth rate is negative.
• 1:12:30
  We have not had any economic growth at all.
• 1:12:34
  We've just been shrinking less and less.
• 1:12:36
  We're still trying to recover and they and they they're trying
• 1:12:40
  to take advantage of that. There's nothing they can do to
• 1:12:42
  get out of it. We're we're in an inflationary
• 1:12:45
  recession right now. Economic growth is negative and
• 1:12:48
  prices are still going up, J Pal told you himself.
• 1:12:52
  The costs are going up. The prices are going up.
• 1:12:55
  Maybe one day they'll have to sit down and ask Dang what
• 1:12:59
  causes more inflation, increase cost structures for businesses
• 1:13:03
  or lower interest rates? Because I think what we're going
• 1:13:07
  to find out is that increased cost structures anchor
• 1:13:11
  inflation. And that's that's not
• 1:13:14
  transitory. That's not transitory inflation.
• 1:13:16
  That inflation is not going away.
• 1:13:17
  If you have monetary inflation, then maybe there's something you
• 1:13:21
  can do to, to try to dampen it. But if you have structural
• 1:13:26
  inflation, it's not going away. And that's the that's the next
• 1:13:30
  inflation wave. The next wave of inflation is
• 1:13:32
  going to be based on the structural inflation through the
• 1:13:37
  cost structures of businesses and families and the government
• 1:13:40
  deficit increasing. And then and then they're going
• 1:13:42
  to lower rates and print more money.
• 1:13:43
  And you're going to get it from both sides.
• 1:13:45
  You're going to have structural sticky inflation, which isn't
• 1:13:49
  going to go away overnight. And then at the same time you're
• 1:13:51
  going to have monetary inflation and you're going to get a double
• 1:13:54
  dose of inflation and that will force the government to even
• 1:13:57
  admit to new all time highs of inflation even though they don't
• 1:14:01
  want to And they're incentivized not to tell you that, they'll
• 1:14:03
  still be forced to tell you that.
• 1:14:05
  And at some point in time, we have to break off of their data
• 1:14:08
  and and not take their interpretation of the data and
• 1:14:12
  get the real data so that we can understand what we are
• 1:14:16
  incentivized to do by the marketplace, which is always
• 1:14:19
  going to be based on the real yield, not the nominal, the real
• 1:14:22
  yield. So for everybody listening, make
• 1:14:24
  sure you're calculating your real yield so that you can
• 1:14:27
  understand how to position yourself and how to allocate
• 1:14:30
  your portfolio as we go through what the Fed is calling this
• 1:14:34
  hire for longer streak. Wow.
• 1:14:37
  Hold on. Absolutely incredible.
• 1:14:40
  Absolutely incredible. Haven't heard it like this, laid
• 1:14:44
  out so, so eloquently showing all the consequences, all the
• 1:14:47
  charts. Just to bring this back, we are
• 1:14:50
  at an hour and 15 minutes. Let's bring this back to Bitcoin
• 1:14:53
  at the end. It was just November 5th.
• 1:14:55
  Everyone you know knows to be remember, remember the 5th of
• 1:14:58
  November. And just to sum this up, and I
• 1:15:01
  do have a tweet here where you say Bitcoin is cheap.
• 1:15:04
  Let's connect Bitcoin. You know, you say it right here
• 1:15:06
  at the bottom. Bitcoin takes away the
• 1:15:07
  government's power of the purse and returns it to we the people,
• 1:15:10
  where it properly belongs. So absolutely love this.
• 1:15:14
  And CJ, thank you so much for coming on, but let's touch on
• 1:15:17
  Bitcoin for a moment. You also recently tweeted, is it
• 1:15:21
  this one? Yes, this one.
• 1:15:23
  Bitcoin is cheap. So let's connect all these
• 1:15:27
  thoughts together. How does Bitcoin fix this?
• 1:15:29
  Is it a good time to be buying Bitcoin?
• 1:15:31
  Should people be saving in Bitcoin?
• 1:15:34
  How do we wrap this up and put a bow tie into this for the people
• 1:15:37
  out there? Absolutely.
• 1:15:38
  And. And a fantastic question.
• 1:15:40
  I'll be fantastic. So actually what I'm going to
• 1:15:43
  ask you to do is I've been creating what I call rabbit
• 1:15:46
  holes. You'll notice in my tweets you
• 1:15:48
  might end up 6 or 7 pages deep because I keep, I keep quote
• 1:15:51
  tweeting on top of quote tweets to help you get down the rabbit
• 1:15:55
  hole. So go ahead and click that quote
• 1:15:57
  tweet there and then Scroll down to the bottom of that one and
• 1:16:01
  now click that one. There we go.
• 1:16:03
  OK, this is what we were talking about with cost structures,
• 1:16:07
  right? There's only one question you
• 1:16:09
  need to be answered to be a successful investor, and that
• 1:16:12
  is, is what I'm buying cheap. So in this case scenario, is
• 1:16:16
  Bitcoin cheap? Well, it's a simple rule.
• 1:16:19
  You buy whatever, you buy X when it's cheap, you sell it when
• 1:16:23
  it's expensive. So how do you know how to answer
• 1:16:26
  this question? My strategy is to take the
• 1:16:30
  producers cost of production, right?
• 1:16:32
  So if I'm looking at real estate and I know that this is a
• 1:16:36
  beautiful single family home, 4500 square feet, awesome piece
• 1:16:41
  of land and what it's going to cost $2,000,000 to replace this
• 1:16:46
  home, right? So there's no way, even if you
• 1:16:49
  had all the connections, you had a developer, you had
• 1:16:51
  contractors, you can't build this house for less than
• 1:16:54
  $2,000,000. So if the price of the house was
• 1:16:58
  less than $2,000,000, I would buy it without hesitation
• 1:17:01
  because the price is below the cost, the the price is below.
• 1:17:04
  In real estate, what they call the replacement cost.
• 1:17:07
  With Bitcoin, we call it the cost of production Satoshi, or I
• 1:17:11
  call it the cost of production Satoshi actually called it the
• 1:17:13
  cost of generating. So the cost of generating
• 1:17:17
  Bitcoin is your baseline. We need to know how much does it
• 1:17:20
  cost to generate a Bitcoin, because once you understand
• 1:17:24
  that, you go back to business one O 1.
• 1:17:27
  The miners can't sell you the Bitcoin for less than it cost
• 1:17:30
  you them to generate it. They'll go out of business.
• 1:17:33
  And if you believe in the value proposition of Bitcoin, if you
• 1:17:36
  believe that sovereign truth money is a is a valuable
• 1:17:40
  proposition to your life, well then you're going to pay above
• 1:17:44
  the cost because you have to and if you don't, well the the
• 1:17:47
  economic consequences will hit you.
• 1:17:49
  So what you see here in this chart is the red place, that red
• 1:17:54
  what I call a price cloud, right.
• 1:17:56
  And the top of the price cloud is the all in cost of
• 1:17:59
  production. This is based on an average and
• 1:18:02
  this is based on worldwide. So you know there's probably a
• 1:18:04
  few institutional miners who are not paying these prices and this
• 1:18:10
  is an older chart. So what I want to show you
• 1:18:12
  through this chart before we go back to the other one OPTI is
• 1:18:14
  what is the commodity cycle, right.
• 1:18:16
  Bitcoin is commoditized energy in the form of money and price
• 1:18:19
  discovery is a commodity cycle. So when the price is in the at
• 1:18:23
  the top of the Red Cloud which is the average all in cost of
• 1:18:26
  production, that's called fair value.
• 1:18:28
  You can see that marked in orange when price goes to a
• 1:18:31
  discount to the all in cost of production.
• 1:18:34
  It's like when that company sends you a coupon, you can buy
• 1:18:37
  it for less, you can buy it for cheaper.
• 1:18:39
  It's when you want to buy when the price is in the Red Cloud
• 1:18:43
  because it's less than the all in average cost of production.
• 1:18:46
  That's your discount zone. So you want to buy Bitcoin when
• 1:18:49
  it's cheap and it's discount zone and when it's at fair
• 1:18:52
  value. Yeah, you can continue to stack,
• 1:18:53
  you're getting a fair deal. But what happens when the price
• 1:18:56
  goes way above the Red Cloud? It goes into what called a price
• 1:19:00
  premium, right? So now imagine that $2,000,000
• 1:19:03
  house isn't for sale for 1.8, it's not below cost, It's not
• 1:19:06
  below replace, It's not a good deal anymore.
• 1:19:08
  It's not cheap. It's expensive because now it's
• 1:19:10
  listed for 4 million. It's it's twice the amount of
• 1:19:13
  the replacement cost. So what you'll see is price goes
• 1:19:16
  from premium to fair value to discount, back to fair value to
• 1:19:20
  premium to fair value to discount.
• 1:19:23
  And it's a cycle that is the Bitcoin commodity cycle.
• 1:19:26
  Now one thing I want to point out here, look what happened
• 1:19:29
  there in the the bear, the bear market of 2018.
• 1:19:35
  You see how price went down into the Red Cloud there in 2018.
• 1:19:39
  It was at a discount, it was super cheap at price was in the
• 1:19:42
  Red Cloud and then look what happened during COVID.
• 1:19:45
  Price was kind of right above the cloud and and you know why
• 1:19:49
  it was at fair value because look, what the halving did.
• 1:19:51
  That black line is the halving. Look what happened to the price
• 1:19:53
  cloud because of the halving. The halving is a is the catalyst
• 1:19:57
  to a new price discovery cycle because the cost for miners
• 1:20:01
  double overnight. You can see the cloud, it
• 1:20:03
  doubled overnight because the rewards go down -50% and that
• 1:20:07
  translates to a doubling of cost.
• 1:20:09
  Well, where did price go? It went right back to where it
• 1:20:12
  needed to be, right back where the miners needed it to be.
• 1:20:15
  To be to to be in business, right.
• 1:20:17
  Because you can't buy it. You can't sell it for less than
• 1:20:20
  it cost you. You go out of business.
• 1:20:21
  So that's now go back to the original tweet you're in.
• 1:20:24
  So people understand the commodity cycle because here's
• 1:20:27
  where we are today. Now you can make that chart
• 1:20:29
  bigger because this is boom right there.
• 1:20:32
  Look where price is, guys? Where's price Is price above the
• 1:20:36
  price cloud. No price is in the price cloud.
• 1:20:39
  Bitcoin is as cheap today as it was during the 2018 bear market.
• 1:20:45
  Bitcoin is as cheap today as it was during the 2020 liquidity
• 1:20:51
  crisis. Bitcoin is cheap, cheap, cheap
• 1:20:54
  today relative to its cost of production.
• 1:20:57
  And if you know what's happening with hash rate, hash rate is
• 1:21:00
  going parabolic. We talked about it between the
• 1:21:03
  comparison between Bitcoin and gold.
• 1:21:04
  When hash rate price drives hash rate, hash rate drives
• 1:21:07
  difficulty. Difficulty drives cost, Cost
• 1:21:10
  increases the floor price. This is the store of value
• 1:21:14
  mechanism that was engineered into Bitcoin and what you're
• 1:21:17
  seeing with that red place floor growing.
• 1:21:20
  Notice what happened after the China mining ban right there in
• 1:21:23
  in the first big fall from that 65,000 peak, where did the price
• 1:21:28
  come back down to? It came down to fair value
• 1:21:31
  because the miners had to sell everything they could to
• 1:21:34
  relocate. But did they sell at a loss?
• 1:21:36
  Hell no. They sold down to fair value.
• 1:21:39
  And then what happened when they stopped selling?
• 1:21:41
  Price went right back up to large premiums.
• 1:21:44
  And then the Federal Reserve announced their interest rate
• 1:21:46
  hikes. Where'd it come back down to
• 1:21:48
  fair value? Because we didn't know if they
• 1:21:49
  were bluffing or not. Then in March when they finally
• 1:21:52
  started raising the interest rate there at the end of March,
• 1:21:54
  where did it go? We went to discount range.
• 1:21:56
  We really went, we entered the bear market for real when they
• 1:21:59
  really started raising interest rates.
• 1:22:00
  BTC is a commodity. It's commoditized energy in the
• 1:22:03
  form of money and it's price discovery cycle is a commodity
• 1:22:07
  cycle. Right now we are at the point of
• 1:22:10
  maximum opportunity prices in the discount zone, prices in the
• 1:22:15
  range where you want to buy it because it's cheap relative to
• 1:22:18
  its cost. Very soon that is going to move
• 1:22:21
  up and actually the bottom of that price cloud is, is about
• 1:22:23
  $22,000. So in April when the halving
• 1:22:27
  hits, guess what happens, the bottom of the price cloud double
• 1:22:31
  S, it's going to go to $44,000. So here, right here, right now,
• 1:22:36
  if you have the ability to make a bet on what the price of
• 1:22:40
  Bitcoin is going to be by the halving, well, maybe it'd be a
• 1:22:43
  good idea to say the price is going to be around $44,000
• 1:22:46
  because if it's not, the miners are going to be in a lot of
• 1:22:48
  trouble, right? This, this worked for me
• 1:22:50
  perfectly during the 2020 halving, and it's going to work
• 1:22:54
  perfectly here because it's a natural law of economics.
• 1:22:57
  I expect price to be at $44,000 minimum going into the April
• 1:23:03
  halving because that's where price needs to be.
• 1:23:05
  Just like you can see there during we had the Coronavirus
• 1:23:08
  crisis, it went down into the cloud.
• 1:23:10
  It bounced up violently to be at the bottom of the cloud for the
• 1:23:14
  halving. Well, price can be anywhere
• 1:23:16
  within the cloud at the time of the halving, the top of this
• 1:23:19
  clouds around $36,000. So it's it's a bit of a spread
• 1:23:22
  there. But historically price starts
• 1:23:25
  out at the bottom of the cloud works its way up trying to break
• 1:23:28
  out a fair value and notice what it did.
• 1:23:30
  It took about four to six months after the 2020 halving.
• 1:23:33
  People were trying to figure out what's going on here.
• 1:23:35
  What's taking so long? We had to get out of the fair
• 1:23:38
  value range, the accumulation, the once that stopped, look what
• 1:23:42
  happened to price. It went parabolic to premiums.
• 1:23:45
  Who sold into those premiums? The miners.
• 1:23:48
  Who's? Where'd they sell it down to
• 1:23:49
  fair value? When they stopped selling, what
• 1:23:52
  happened? Premiums.
• 1:23:53
  Who sold into it? Probably macro.
• 1:23:55
  Probably miners as well when they when they started raiding
• 1:23:58
  interest rates. Where'd we go?
• 1:23:58
  Discount When the halving happens in April, the cost of
• 1:24:01
  production on the electric side on the bottom of the price cloud
• 1:24:04
  will be at least 44,000. That's that's where price is
• 1:24:07
  going to be minimum in order for miners to maintain their
• 1:24:10
  business model and in order for people to to believe the value
• 1:24:14
  proposition of Bitcoin. If you want to benefit from the
• 1:24:18
  value proposition of Bitcoin after the April 2024 halving,
• 1:24:21
  it's going to cost you at least 44,000 because no mine are in
• 1:24:24
  their right mind. Maybe there's some a few dumb
• 1:24:26
  ones out there, but nobody in their right mind is going to
• 1:24:29
  sell you it for less than it cost to produce.
• 1:24:31
  And the best of the best are going to be at the bottom of the
• 1:24:33
  price cloud, whereas the retail is more towards the top of the
• 1:24:36
  price cloud. But right now, Bitcoin is cheap.
• 1:24:39
  So don't use psychological price points like 40,050 thousand,
• 1:24:44
  60,000 to determine whether or not Bitcoin is cheap or not.
• 1:24:48
  You have to form a baseline, and that baseline is the cost, and
• 1:24:52
  you look at the market price relative to the cost.
• 1:24:55
  Bitcoin is cheap. Buy as much Bitcoin as you can
• 1:24:57
  when it's cheap, because premiums will come.
• 1:25:00
  That's part of the commodity cycle.
• 1:25:03
  Wow. Hold on for everyone in the chat
• 1:25:05
  here, you guys. Let's see.
• 1:25:10
  That's called motherfucking plants of applause.
• 1:25:12
  Wow, CJ Well. I'm sure we could sit here for
• 1:25:16
  another hour and a half, but let's let's let's end it on this
• 1:25:21
  note, I I think we gave the audience a lot of food for
• 1:25:25
  thought there and and this will give me an excuse to bring you
• 1:25:28
  back on sooner than later. So I don't know, we'll have to
• 1:25:31
  figure out what what's a good time maybe just the beginning of
• 1:25:33
  the year once the once this fourth quarter four ends.
• 1:25:37
  We'll, we'll update this and we'll see where we are and of
• 1:25:40
  course we'll bring you back on around the halving.
• 1:25:42
  We might have to just make CJA regular.
• 1:25:44
  I know you're going to make content soon, but man.
• 1:25:48
  Absolutely. Mind blown.
• 1:25:49
  I know for a fact I'm going to have to re listen to this one,
• 1:25:51
  but I I think at the end there what what more do we need to say
• 1:25:55
  guys, you need to buy Bitcoin. But of course CJ, I'll give you
• 1:25:58
  the floor. Last youth sat on this
• 1:26:01
  conversation so we could tie this up.
• 1:26:03
  And then of course we'll let you go on your way and go hang out
• 1:26:06
  with your family and all that good stuff.
• 1:26:08
  Well, thank you so much for having me, Opti.
• 1:26:10
  I really appreciate it. I love your audience, I love
• 1:26:12
  your platform, and you do a really good job of steering me.
• 1:26:15
  Everybody here knows I can go on and on.
• 1:26:17
  So thank you for doing that and for pulling up all those charts,
• 1:26:20
  helping everybody understand not only through words but also
• 1:26:23
  visually what's happening because right now is the most
• 1:26:27
  important time in the history of finance.
• 1:26:31
  Never before have the debts been this large.
• 1:26:33
  Never before have the debt issuers that are the government
• 1:26:37
  been in this position, never before have higher yields passed
• 1:26:41
  through as higher costs. We're seeing a a change in the
• 1:26:45
  marketplace and the smart money is starting to figure it out
• 1:26:48
  now. So if you're on the sidelines
• 1:26:51
  thinking that we're going to get some type of depression, the the
• 1:26:54
  probability of A of a small pullback of a of some type of
• 1:26:58
  liquidity crisis event, it exists.
• 1:27:00
  Absolutely it exists. We could get another March 2020
• 1:27:03
  moment, but the reaction to that moment is going to be
• 1:27:08
  inflationary, not to allow the system to fall apart and crash
• 1:27:12
  and burn because then they lose the status quo.
• 1:27:14
  So just remember the ultimate goal of these people who have
• 1:27:18
  the decision making power is to maintain the status quo.
• 1:27:21
  Don't let the macro interpretation affect your
• 1:27:24
  strategy. Understand the real rate of
• 1:27:26
  return. Understand that bitcoins
• 1:27:29
  compounding annual growth rate over the last 10 years is 70%.
• 1:27:34
  So unless there's some type of debt instrument that is paying
• 1:27:37
  you 70% with, I don't know anything could pay that with the
• 1:27:41
  amount of risk that would be involved with that kind of
• 1:27:44
  yield. But bitcoins 10 year compounding
• 1:27:47
  annual growth rate is 70%, so it doesn't really matter if
• 1:27:51
  inflation is 5%. Ten percent, 15 percent, 20% say
• 1:27:56
  inflation goes to 20%. You're still going to increase
• 1:27:59
  your your purchasing power on a 10 year timeline.
• 1:28:02
  Roughly about 50% year over year in Bitcoin.
• 1:28:05
  You can't get that opportunity anywhere else.
• 1:28:08
  Bitcoin is the apex predator of how to store value.
• 1:28:11
  It was engineered to be that way.
• 1:28:14
  Now's the time to be telling your friends and family about
• 1:28:17
  what's going on. Now's the time to be paying
• 1:28:19
  attention. On my YouTube channel, I put
• 1:28:21
  together an orange pill playlist for the holidays.
• 1:28:25
  So check those videos out. They're all like a couple
• 1:28:28
  minutes long because I know you know, nobody's going to be at
• 1:28:30
  dinner. Like, hey, watch this video,
• 1:28:31
  it's an hour long. It's impossible.
• 1:28:33
  These are all videos that are 90 seconds.
• 1:28:35
  Two or three minutes can show it to a family or member and just
• 1:28:38
  kind of let them have that mind explode moment where like I
• 1:28:43
  never heard it that way. I never thought so I got a bunch
• 1:28:45
  of them in there. Use it this holiday season and
• 1:28:47
  use it out of love because this is a peaceful revolution.
• 1:28:51
  Bitcoin is bringing us to a prosperous future with correct
• 1:28:54
  incentives and proper free market economics.
• 1:28:58
  Not this manipulated fake growth, inflation, data
• 1:29:02
  manipulation system that we're in now, which is coming to an
• 1:29:05
  end. Don't let anybody tell you it's
• 1:29:07
  not coming to an end. All the bells are going off, all
• 1:29:10
  the whistles are going off and people who know what are going
• 1:29:13
  on are doing. I might seem a little bit crazy,
• 1:29:15
  but you got to realize I've been saying this for I've been wrong
• 1:29:18
  for nine years, but now I'm right.
• 1:29:20
  So I've been. I've been wrong for a long time
• 1:29:22
  and warning people about inflation.
• 1:29:24
  Inflation is 2%. CJ Who cares?
• 1:29:26
  Who cares? Yeah, but now they've lost
• 1:29:28
  control of the yield. Now they've lost control of the
• 1:29:31
  ability to incentivize people with higher yields.
• 1:29:34
  Now that you understand this, simplify it down.
• 1:29:37
  Comment to me, Share with me. Let's work together to wake up
• 1:29:40
  our family and friends, because this train is coming and nothing
• 1:29:43
  can stop it. Absolutely incredible.
• 1:29:46
  Great for the audience out there.
• 1:29:49
  CJ what is your YouTube channel link?
• 1:29:52
  You know, I I think it's just at CJ Constantino's, just like my
• 1:29:55
  Twitter, just at CJ Constantino's.
• 1:29:58
  Sweet. Well, CJ, all us ADIQS are mind
• 1:30:02
  blown right now we're like, OK, I am.
• 1:30:04
  I just so lucky that I hold Bitcoin and really you know.
• 1:30:10
  There has been a lot of macro talk recently and and it seems
• 1:30:13
  like Bitcoin is becoming even more macro involved.
• 1:30:16
  And you know there's the meme on Bitcoin Twitter, like macro,
• 1:30:18
  macro, macro, everything's macro.
• 1:30:19
  People are getting upset about it, but it's becoming very
• 1:30:22
  obvious to anyone paying attention that Bitcoin is the
• 1:30:26
  solution and hey, they are also looking for the solution.
• 1:30:30
  Anyone that sees the problem is looking for a solution.
• 1:30:33
  So of course. Roads lead to Bitcoin.
• 1:30:35
  So here we are. I I don't think I've, I've heard
• 1:30:38
  a a better storytelling narrative about the facts and
• 1:30:41
  what's going on and just painting a picture that that
• 1:30:45
  does seem very dark and bleak. Yet if we didn't have Bitcoin,
• 1:30:51
  that would be bad. That would be bad 100%,
• 1:30:54
  absolutely incredible. CJ, Well, really appreciate you
• 1:30:57
  coming on and educating our audience.
• 1:31:00
  In the meantime, we'll bring you on as many times as possible.
• 1:31:03
  Guys, let me know what you guys want.
• 1:31:05
  Send me questions. CJ, if they have questions for
• 1:31:07
  you, we can do AQ and A where we can cover everything from front
• 1:31:11
  to back. Anyway, CJ, hang out in the back
• 1:31:14
  for a moment. Sweet.
• 1:31:15
  Hang out in the back for a moment while I wrap this up and
• 1:31:18
  we'll talk about this, guys. Absolutely incredible.
• 1:31:22
  Incredible. RIP today, shouts out to CJCJ
• 1:31:26
  Constantinos on Twitter or X on YouTube.
• 1:31:30
  I highly recommend you guys follow his Twitter because he
• 1:31:34
  lays this stuff out for you guys basically every single day.
• 1:31:38
  Yet me, I am a vocal oral visual learner.
• 1:31:43
  So you know, I can read it and I'm like, yeah, this makes
• 1:31:45
  sense, but when someone explains it to you, it just hits that
• 1:31:48
  much harder And and we connected all the dots for you guys.
• 1:31:50
  So like share, subscribe, send this to your normie friends,
• 1:31:53
  send this to your parents, send this to your macro financial
• 1:31:57
  advisor. That's like you're an idiot bit
• 1:31:58
  corner. Because I think, I don't think
• 1:32:01
  they're going to beat this analysis anyways, guys, Peace
• 1:32:03
  out. We will be back tomorrow for our
• 1:32:05
  normal show. What a rip.
• 1:32:07
  What a rip. All right, peace out.