Latest / What Bitcoin Did / The Final Stage Of The Bitcoin Bear Market | Joe Consorti

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The Final Stage Of The Bitcoin Bear Market | Joe Consorti · What Bitcoin Did

• 0:00
  The Fed cannot stop printing money.
• 0:04
  Global central banks cannot stop printing money out of thin air.
• 0:07
  And not just printing money, but printing money at an accelerating pace.
• 0:09
  That is why Bitcoin exists.
• 0:10
  It is an absolutely scarce monetary asset that has absorbed and will continue to absorb
• 0:15
  the excess liquidity, the excess money printing that global central banks just can't stop printing.
• 0:19
  As long as central banks keep printing money, Bitcoin's value prop remains unchanged.
• 0:24
  And a 50% drawdown isn't something that should scare you.
• 0:26
  It should be viewed as an opportunity and nothing more.
• 0:28
  Global M2, the global money supply, actually is expanding at its fastest rate since 2021 right now
• 0:32
  for the asset owners, right? So the asset owners benefit massively as a result of inflation. It's
• 0:37
  why the Federal Reserve exists to enrich those who own assets and to control the money to control you,
• 0:42
  whereas those who don't own assets don't benefit. Despite the economy seemingly from the outside
• 0:46
  looking in doing okay, and the moment we reach a tipping point where because of these delinquencies,
• 0:52
  the consumer cannot afford to borrow their way into living anymore, then that's the point at
• 0:56
  would you get a recession? Dude, we have got a lot to talk about today. I don't even know where
• 1:05
  we start. Do we start with everything that's happened with Saylor and Stretch? Do we start
• 1:09
  with Bitcoin price sat under 60K, breaking through the power law? Where do you want to start?
• 1:14
  My goodness. I think we start with the Bitcoin price and then we lead into Saylor. I think
• 1:19
  Saylor is probably what everybody's here for. I know you had Adam Livingston on your show recently.
• 1:23
  he's fantastic when it comes to this stuff um you know look what i'll do first is i'll call back to
• 1:29
  in january um when i was last in the show and i said bitcoin was going to go to 40k when i said
• 1:35
  that i didn't leave it myself um yeah for the most part i believed it but you know part of me
• 1:41
  didn't want to believe it that that bitcoin could go that low but every sort of sign was pointing in
• 1:45
  that direction um just from a percentage perspective purely the last cycle we had about
• 1:50
  a 78% drawdown. This cycle is 75% drawdown would mean about $40,000 Bitcoin, if not a little bit
• 1:57
  lower. And since we recorded, we're down from, I think, like the 70s, high 70s to 58K. And as you
• 2:05
  mentioned, we just broke through the floor. I believe we have officially closed under it as
• 2:09
  of recording. If not, we definitely will close under it by the time the show goes live.
• 2:14
  underneath the power law floor,
• 2:16
  which is a floor that is held
• 2:17
  for Bitcoin's entire price history.
• 2:20
  Now, Giovanni Santistassi,
• 2:22
  the astrophysicist who originally discovered
• 2:25
  that Bitcoin had a strong power law relationship,
• 2:28
  actually went out and said that the floor model
• 2:31
  doesn't really matter all that much.
• 2:32
  It's mostly the ceiling model
• 2:33
  and the median to look out for.
• 2:35
  But regardless-
• 2:36
  Stock to floor vibes.
• 2:37
  Psychological, exactly, yeah.
• 2:39
  And for me, from a psychological perspective,
• 2:41
  you gotta wonder,
• 2:42
  like people looking at that, they're going to say, wow, yet another Bitcoin model broken,
• 2:47
  yet another sacred cow slain, if you will. We sort of get these every single cycle.
• 2:51
  Last cycle, it was Bitcoin can't dip below the prior cycles all time high. We killed that one.
• 2:55
  This cycle, it was, oh, the four year cycle is dead because we, you know, we made a new low in
• 2:59
  February. We killed that one or we're on the way to killing that one as Bitcoin tries to carve out
• 3:03
  new lows here. And the latest one seems to be this power law floor, this absolute floor that
• 3:08
  cannot be broken underneath. Now, before people click off the video because they say, well, you
• 3:12
  nope, again, technically, it's about the ceiling, not the floor. You got to think about the
• 3:16
  psychological component of this, right? That is the second major model slash idea that has been
• 3:21
  broken this cycle. And as a result, it's probably going to lead to even more downward price action,
• 3:26
  right? This reflexive feedback loop of Bitcoin models being broken, retail investors hearing
• 3:30
  about it or institutional investors hearing about it and deciding to sell their bags and potentially
• 3:36
  rotate even more into the AI trade. So it's an interesting time for Bitcoin. You know,
• 3:40
  there are a lot of models underneath us and a lot of things suggesting that the bottom is probably
• 3:45
  closer than people think. I'd like to revise up my estimate from the last video. I think we're
• 3:51
  probably going to bottom in the low 50s, high 40s, rather than visiting all the way down to 40k.
• 3:56
  But we'll see what happens. I think it's another couple of weeks here, maybe a few more months of
• 4:00
  chopping around a couple legs down and demoralize everybody. And then we bottom out. Because what
• 4:06
  I'll say, Danny, is there are too many people saying that the bottom is close for the bottom
• 4:09
  to be as close as we think. Yeah, that's probably true. But like, I didn't think we were going to
• 4:15
  get 58K again, which is, I mean, I'm here for the memes. That's awesome. But it does feel like
• 4:20
  Bitcoin just feels cheap and Bitcoin never feels cheap for long. That's kind of my just gut check
• 4:24
  on it. Like when I look and you think, you know, a million sats for $500, like that's very cheap.
• 4:30
  I'm going to be buying that all day long. Like how long do you think we can sit in this sort of
• 4:35
  50 to 60k price range for sure yeah i'd say longer than many people think um like 58k is literally
• 4:43
  for me back up the truck level mortgage the house level sell a kidney level to buy bitcoin um you
• 4:50
  know historically speaking bitcoin spends about three to six months in this bottoming zone if not
• 4:55
  higher it spends um uh before breaking back above the 200 week moving average after losing it
• 5:01
  in 2022, Bitcoin spent nine months in its bottoming zone. Now, we don't have an FTX of this cycle. We
• 5:07
  don't have a Celsius block, five, three areas capital, and others who are forced liquidators
• 5:11
  as a result of bad leverage. So we might not spend that much time around a bottoming zone.
• 5:15
  It might be one wick down and then a massive bid to move higher than it. But I tend to think that
• 5:22
  we will spend some time chopping around in this range purely because the uncertain geopolitical
• 5:28
  backdrop, which we'll get into the Iran war, which is still sort of overhanging markets,
• 5:32
  which we'll get into and the AI trade, which I think we'll talk about as well.
• 5:36
  I tend to think that Bitcoin is just going to spend a lot of time hanging out in this area,
• 5:40
  maybe move into the lower 50s, high 40s, as I mentioned, and then just spend so much time here
• 5:44
  that people get demoralized. They're fully convinced it's dead. And then when that happens,
• 5:49
  it begins moving higher, right, as we've always experienced. So the TLDR of it, reading the tape
• 5:54
  and sort of trying to make sense of these things,
• 5:57
  I tend to think that Bitcoin will probably
• 5:59
  find its final low around October or November.
• 6:02
  It's also sort of what the four-year cycle is pointing to.
• 6:05
  And then begin ascending higher
• 6:06
  through the end of the year into January
• 6:08
  and Q1 of next year is really going to be
• 6:10
  the first breakout quarter, in my mind,
• 6:12
  for the next Bitcoin bull market.
• 6:15
  Why are you putting it at that time zone?
• 6:16
  Like, is that because it kind of interacts
• 6:18
  with the midterms, things like that?
• 6:20
  Like, why October?
• 6:22
  For sure.
• 6:23
  So a couple of different things that are all seemingly coming into confluence with one
• 6:27
  another at the same time.
• 6:28
  The midterms is one of the things that you had mentioned, but there are two others.
• 6:33
  So the first being the midterms, the second being the inflation backdrop, and the third
• 6:38
  being the ultimate rotation out of the AI trade for risk capital and back into Bitcoin,
• 6:43
  which is the most speculative of all of them, but I'll sort of try to explain my case.
• 6:48
  And then the fourth being the end of the four-year cycle.
• 6:50
  So attacking those in order, the midterm is Bitcoin tends to underperform during midterm years.
• 6:55
  It tends to do very poorly during midterm years.
• 6:57
  This is purely because of an uncertainty perspective, right?
• 7:00
  Yeah, markets hate uncertainty.
• 7:02
  Exactly.
• 7:03
  Mark is absolutely despised uncertainty.
• 7:05
  Here in the States, we have this beautiful two-party system where one side hates you and one side hates you a little bit less.
• 7:12
  And we get to elect them every two years into office.
• 7:17
  It's really wonderful.
• 7:18
  And so one of those periods is coming up this year.
• 7:21
  Typically during midterm years,
• 7:23
  Bitcoin tends to be a little bit shaky
• 7:24
  as midterm season approaches.
• 7:26
  But most importantly, midterm years
• 7:28
  when Bitcoin is in a bear market,
• 7:30
  also happens to be roughly every four years.
• 7:32
  And so effectively what we are approaching now,
• 7:34
  what we're experiencing right now
• 7:35
  is the uncertainty of the midterms approaching
• 7:38
  layered on top of Bitcoin underperforming
• 7:40
  because it's a bear market.
• 7:41
  And so obviously Bitcoin isn't gonna do well
• 7:43
  until the midterms pass.
• 7:45
  Midterms are early November, right?
• 7:46
  So that's event number one of four.
• 7:49
  Event number two of four is the Iran war.
• 7:51
  So the Iran war I've spoken about on my channel numerous times before.
• 7:56
  Essentially what you've got is in the early innings of the war when it seemed like it was only going to be, excuse me, potentially only a few weeks, Bitcoin is actually the best performing asset since the start of the war.
• 8:06
  if you measured it from February 28th to about the end of April when this dynamic ended,
• 8:11
  Bitcoin actually performed better than literally everything else, better than gold, better
• 8:14
  than the NASDAQ, better than the S&P 500 by more than double.
• 8:19
  And then it began breaking down Can we sprinkle a little bit of salt on that though Because like it had just crashed like 50 in the two months prior The one caveat So you can read too much into it That said Bitcoin been totally hammered by the war
• 8:31
  but everything else seems to be doing fine.
• 8:33
  Why is that?
• 8:34
  Well, I'm of the opinion that
• 8:36
  it's not because Bitcoin is dead.
• 8:37
  It's because Bitcoin is the only asset
• 8:39
  that's accurately pricing in reality right now, right?
• 8:41
  You have a major geopolitical conflict
• 8:43
  over in the Middle East.
• 8:44
  The Strait of Hormuz has been closed.
• 8:47
  Largely, it just recently opened up last week,
• 8:49
  but we'll really see how long that lasts.
• 8:51
  The street of Hormuz is a very critical shipping lane
• 8:53
  for 20% of the world's oil supply.
• 8:56
  Not just 20% of the world's oil supply,
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  and I'll get to why that's critical in just a moment,
• 9:00
  but 20% of the world's oil supply,
• 9:02
  that's done extremely cheaply, right?
• 9:06
  Let's just say that Iran doesn't have
• 9:08
  the best labor laws in the world, right?
• 9:10
  So, you know, it's much cheaper than getting oil
• 9:13
  from anywhere else in the country.
• 9:14
  So anywhere else in the world, rather.
• 9:15
  So it doesn't just have a 20% impact on price.
• 9:18
  It has more like a 50, 70, 80, 100% impact on the price when that straight was closed for literally four months, five months, almost five months.
• 9:28
  And so basically what I had been saying for several months is that if the straight remained closed until mid-June, because everybody was saying mid-June was sort of the benchmark for if the straight isn't opened, then we are going to have a worldwide recession.
• 9:42
  Then you would have a worldwide recession.
• 9:43
  Why is that?
• 9:44
  Well, basically, I mentioned that it's responsible for 20% of the world's oil supply.
• 9:48
  You may be thinking, okay, oil goes in my car.
• 9:51
  Why else is it important?
• 9:52
  Well, I think everybody at home knows that basically every product in the modern world
• 9:57
  is a petroleum product, right?
• 9:59
  Petroleum byproduct to some degree.
• 10:00
  The paint on the wall behind me, the couch behind me, that's probably not real leather,
• 10:04
  so probably the entire couch behind me, the microphone I'm speaking into, the camera that
• 10:09
  I'm looking at, all of them have petroleum in them in one way or another.
• 10:13
  And so having 20% of the world's oil supply shut off, the world's cheap oil supply, and
• 10:18
  causing that massive uptick in the price of oil that has downstream impacts and not just the price
• 10:23
  at the gas pump, but the price of every downstream product. More importantly, the price of food,
• 10:28
  right? How do diesel engines work? How is fertilizer going to get transported? How is
• 10:33
  fertilizer going to get created? All of these things threaten to lead to a massive inflationary
• 10:39
  spike throughout the year, and they already are. So inflation just printed above 4% for the first
• 10:45
  time since 2022. Because the trade has been closed for four months, you're going to see
• 10:49
  a lagged effect, sort of this drip through, this pass through over the next few prints.
• 10:54
  I think inflation is going to take higher. I think it's going to go to five, maybe even six percent
• 10:58
  before turning the corner and beginning to decline now that the Strait of Hormuz is back open. And
• 11:03
  guess what? As I'd been saying in all of my videos for the last three months, the Strait of Hormuz
• 11:08
  opened literally middle of June, one day after mid-June. So right when all the experts, and I
• 11:14
  was saying it has to open. Otherwise we get a worldwide recession. And the reason for that is
• 11:17
  quite simple, right? Um, if we induce a recession during a midterm year, then like the Republicans
• 11:22
  are done, they're toast. And so even though the United States is fighting this war, not for itself,
• 11:26
  but for another country, um, at the end of the day, the Republicans care about keeping their jobs.
• 11:31
  They want to remain in office. And so that is why they said, okay, we're not going to end the war.
• 11:36
  We can end the war. We got to keep fighting this for our buddies over there. But what we can do is
• 11:40
  we can reach an agreement with Iran to open the strait, and that's what they've done,
• 11:43
  and tankers are beginning to come out. So that's reason number two. Now, in addition to that reason,
• 11:49
  many people have pointed out the fact that the S&P 500, the NASDAQ, the Russell, all of them are
• 11:55
  doing exceptionally well. Bitcoin seems to be the only asset that is declining, that is in a bear
• 12:00
  market. The reason for that is quite simple. As I mentioned, not just the four-year cycle, which
• 12:04
  I'll get into, but Bitcoin is the only asset that's accurately pricing in this terrible geopolitical
• 12:09
  backdrop that I just laid out. Obviously, when you have massive inflation, rate hike odds increase,
• 12:15
  that leads to a huge de-risking across capital markets. And it also threatens an inflationary
• 12:19
  recession because inflation is at 4%. It could go to 5%, could go to 6%. You'll remember, Danny,
• 12:24
  the last time we had inflation, that was like 9% back in 2022. We technically had a recession. We
• 12:30
  had two consecutive quarters of negative GDP. And so should the straight remain closed, that's what
• 12:34
  we would have gotten. So why are other assets not reflecting that reality? Why is Bitcoin the only
• 12:38
  one that sold off, well, you have the AI trade, right? We've seen all of the headlines, like the
• 12:43
  most capital expenditure ever, as far as any new technological advancement in history, right?
• 12:49
  There is real money behind this, and there is real capital that wants to get in and get exposure,
• 12:54
  not just to the AI names that are already out there that are doing exceedingly well,
• 12:58
  the NVIDIAs, the AMDs of the world, the Metas, the Microsofts, what have you,
• 13:02
  but also the IPOs that are yet to come. You have OpenAI that just rescheduled this IPO for early
• 13:07
  next year. Same thing with Anthropic, I believe. They're still aiming for Q4, but probably looking
• 13:11
  at Q1. You have SpaceX was just IPO'd. This is a massive drain on capital from every other corner
• 13:17
  of the market, right? These are once in a generation initial public offerings. Granted,
• 13:21
  they may be overvalued, whatever. I think we can all agree that they are overvalued.
• 13:25
  Transformational technology, but overvalued nonetheless. I don't think they're a bubble,
• 13:29
  but that said, if anything, they're a massive capital suck from other areas of the market,
• 13:33
  Bitcoin included. And so that is why equities are ripping despite a deteriorating macro backdrop.
• 13:38
  Everyone wants exposure to this once in a generation IPO event. And the fourth reason,
• 13:44
  this other major reason is the Bitcoin four-year cycle, right? Bitcoin, I had believed that it had
• 13:50
  broken the four-year cycle because at this point in my mind, with 20 million Bitcoin already in
• 13:56
  existence, the remaining 999,000 some odd Bitcoin to be mined over the next 114 years, I figured
• 14:03
  that cutting the supply schedule in half
• 14:05
  wouldn't have a major impact on Bitcoin's price
• 14:07
  and it would no longer follow this four-year cyclicality.
• 14:11
  But here we are, right?
• 14:12
  Bitcoin topped literally to the day
• 14:13
  when the four-year cycle said it would.
• 14:15
  And so chances are it's also gonna bottom
• 14:17
  when the four-year cycle says it will.
• 14:19
  Now, this is the last thing I'll say.
• 14:21
  Why on earth does it still have influence over Bitcoin?
• 14:23
  Is it a real supply shock mining dynamic
• 14:25
  or is it just retail investor reflexive behavior
• 14:29
  where they believe Bitcoin's gonna top on a day
• 14:31
  because of this Bitcoin model?
• 14:32
  So they sell in advance of it.
• 14:33
  and then they plan to buy the following year.
• 14:35
  I think it's a blend of both,
• 14:36
  leaning more towards the latter, right?
• 14:38
  If enough people, particularly the new market entrants
• 14:41
  who came around during the ETF era,
• 14:43
  believe that this cycle, this model,
• 14:47
  has a lot of influence over Bitcoin,
• 14:48
  particularly if you're a new market participant,
• 14:50
  if you look at a model that's as predictable
• 14:51
  as the four-year cycle,
• 14:53
  you're gonna trade around it, right?
• 14:54
  Like, even though Bitcoin's hugely volatile,
• 14:56
  if you look at the four-year cycle,
• 14:57
  it's actually quite predictable, you know?
• 14:59
  From a price perspective, it's volatile,
• 15:01
  but from where it's going,
• 15:03
  whether it's an Ebola or a bear, it's actually one of the most predictable assets on the planet.
• 15:08
  And so like new market entrants, look at that and trade in advance of it. OG market participants,
• 15:13
  look at that and trade in advance of it. And so that's basically why I believe the four-year
• 15:17
  cycle still has influence over Bitcoin and why I think we're going to be bottoming out around
• 15:20
  October. Oh, and the reason October holds for the AI point and the war point is that with the
• 15:28
  rate of Hormuz opened. The lagged effects of inflation, in my mind, are going to peak around
• 15:33
  early October and then begin declining, removing rate hikes from the table. And then for the AI
• 15:39
  point, with the SpaceX IPO already past us and the Anthropic IPO slated for Q4, the only remaining
• 15:46
  IPO will be open AI. And that was originally scheduled for Q4, but now it's Q1. And so most
• 15:52
  of the capital sink from these AI investments will be off the table. Ideally, that risk capital will
• 15:57
  rotate back into Bitcoin. Those are the four things in my mind that point to a Bitcoin bottom
• 16:01
  around Q4, ideally October, November, but we'll see. This could age like milk.
• 16:06
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• 18:25
  let's start with the things that are external to bitcoin because you mentioned you think inflation
• 18:31
  is going to come back you don't think they're going to hike rates this year like if inflation
• 18:36
  comes back will they wait until october november before they actually do an initial rate hike
• 18:41
  yeah so uh i tend to think potentially not well here's the reason i don't think they're going to
• 18:48
  hike rates at all and this is like my most contrarian opinion um so many people calling
• 18:52
  me a Mormon for saying this, but here's my thinking. You have two kinds of inflation.
• 18:56
  You have push inflation, which is driven by cost inputs like oil, right? The price of oil reprice
• 19:05
  is massively higher from 70 bucks pre-war all the way up to $120, almost doubling.
• 19:10
  That's driving inflation as a result of an input cost increasing. You cannot fix that type of
• 19:16
  inflation with rate hikes, right? The other kind of inflation is pull inflation, right? And we're
• 19:21
  talking about price inflation here, you and I both know, Danny, that the chief reason for inflation
• 19:25
  generally is money printing, right? But from a consumer perspective, from a price perspective,
• 19:31
  you also have pull inflation, which is where consumers are able to borrow a lot of money
• 19:36
  really cheaply. Too much money gets lent into existence, i.e. printed. And then by raising rates
• 19:41
  and not printing a ton of money, you can rein in inflation. So a lot of the pundits who are saying,
• 19:47
  well, the Fed is going to hike rates in order to rein in inflation. Well, the reality is you
• 19:52
  cannot fix an input cost driven inflationary spike by raising interest rates. All that's going to do
• 19:58
  because it's not driven by a consumer that is borrowing too much money and spending it into
• 20:03
  existence. It's driven by input costs that are high. So all you're going to do by raising rates
• 20:07
  is put even more pressure onto the consumer. And so that's why for me, rate hikes were always
• 20:12
  misguided, at least as of right now. We'll have to see what happens. I don't think Warsh is dumb
• 20:17
  enough to deliberately induce a recession. And so for that reason, I don't think we're going to
• 20:20
  see rate hikes at all. But if we do, I think it's going to be catastrophic for the consumer. And I
• 20:25
  think it will fast track a recession because consumers will then not only be facing five
• 20:30
  and a half percent interest rates, then six, then six and a half and seven. And that's just policy
• 20:35
  rates. That's the benchmark rate. Then everything is priced on top of that. So get ready for 30%
• 20:39
  credit cards, 10% mortgages, all of that. Like enjoy in addition to your 7% inflation. That's
• 20:44
  why I don't think it's going to happen. The other thing, and this is why I think rate at the very
• 20:50
  least holding rates is more likely for this year, if not rate cuts. Well, what's the scenario in
• 20:54
  which we see rate cuts? I don't think we see inflation normalized this year. I think you see
• 20:58
  the next couple of prints continue to etch higher. But I think next year you see rate cuts. The
• 21:03
  scenario you see that once inflation normalizes, the scenario where you see rate cuts sooner than
• 21:08
  that is if inflation becomes such a large issue for the consumer that it induces a recession in
• 21:14
  and of itself. We haven't had a true inflationary recession since the 70s. Lynn Alden has talked
• 21:19
  about this, where it's literally entirely driven by inflation. The recession isn't driven by
• 21:26
  deflation, like a credit-based recession where you have a 2008 or a 2023 type event, but it's
• 21:31
  driven by prices literally becoming too high that consumers can't spend anymore. We haven't had that
• 21:36
  since the 70s. And it will be very interesting to see how the Fed responds in the event that we get
• 21:42
  that massive rate cuts. That's a world where I see 0% interest rates again. I'm not calling for that.
• 21:47
  But in the event that inflation becomes too much of an issue, I think that will be the response,
• 21:52
  cutting interest rates. So this year, at the very least, I think they're on hold.
• 21:55
  Once inflation comes back down to earth, they cut. And if inflation comes back down to earth
• 21:59
  as a result of a massive recession, you're going to see a lot of cutting and a lot of money printing
• 22:02
  too. Yeah. I mean, it'll be also interesting. I know Walsh in his first press conference said
• 22:07
  that he's going to create an inflation task force to figure out what inflation is. And I wonder what
• 22:13
  comes back from that and how they kind of move the goalposts and how that plays into potential rate
• 22:18
  hikes or rate cuts in the future. Right. It's just remarkable. It kind of reminds me, not to be too
• 22:24
  crass on the show, but it reminds me of like the Jeffrey Epstein task force that they made.
• 22:28
  All right, guys, we're going to assemble this crack team to figure out who was on Jeffrey Epstein's
• 22:33
  island. And then they realized during the investigation, they were like, wait a second,
• 22:36
  and it was us. We can't release these findings. Sorry for making you spit up your water. So I
• 22:41
  think it's going to be the same thing here. They're going to be like, oh, wait, inflation
• 22:43
  is actually caused by money for it. And so it's going to be a nothing burger.
• 22:47
  Yeah. And so, okay. And then the other part that was external that I thought was interesting is
• 22:51
  you're saying that the US economy is running pretty hot right now. Outside of just the AI
• 22:56
  sector, is that true? Because obviously AI stocks do incredible. Anything that's touching data
• 23:00
  centers or chips or these frontier models, but is anything else doing well?
• 23:04
  Yeah, so you've got the Purchasing Managers Index, which is a great gauge for whether or not the economy is expanding or contracting.
• 23:12
  So basically what it is, for those who might not know, is people who run companies in the manufacturing and the services sectors in the United States broadly get surveyed every month.
• 23:22
  A handful of them get surveyed every month, and they're asked across three different vectors, are conditions better or worse than last month?
• 23:29
  Across prices paid, across employment, and then across new orders.
• 23:31
  So are your prices paid better or worse than last month? Are your new orders higher or lower? Is your employment situation better or worse? Are you hiring more people or firing more people? And that is ticked up pretty considerably into what's considered expansion territory. It's an index that oscillates around 50. So expansion is above 50. So at the very least, the manufacturing and services economy are great. What about the consumer? How are the consumers doing?
• 23:57
  Well, the consumers aren't doing great.
• 23:59
  Consumer sentiment is obviously at a 53-year low,
• 24:02
  which is crazy, literally the lowest it's been
• 24:04
  since that survey has gone out.
• 24:06
  This is the University of Michigan Consumer Sentiment Survey.
• 24:09
  And obviously, when I made a video about this,
• 24:11
  a lot of people were very quick to remind me
• 24:12
  that there is quite a bit of political bias
• 24:14
  in the University of Michigan Sentiment Survey.
• 24:16
  It still does reflect reality, in my opinion.
• 24:19
  If you actually look at the way that it is measured,
• 24:21
  there isn't a lot of, I mean, it's an opinion survey, right?
• 24:24
  So obviously, there's gonna be some bias in there.
• 24:26
  So you can't trust it completely.
• 24:29
  But I tend to agree with their reasoning
• 24:30
  for why they say that the economy is worse
• 24:32
  than it has been in years,
• 24:34
  because we've had now, this is the second bout,
• 24:38
  excuse me, of crazy elevated inflation during the 2020s.
• 24:41
  We had inflation tick all the way up to 9.1% during 2022
• 24:44
  and obviously came back down,
• 24:45
  but prices never come back down.
• 24:48
  So price inflation never dips negative into deflation.
• 24:52
  So while people may say, okay,
• 24:54
  but inflation is down from 2022,
• 24:56
  Prices remained elevated, right?
• 24:59
  And so that's a really pernicious thing.
• 25:01
  And so it doesn't surprise me at all
• 25:03
  that the consumer is really feeling the weight of this,
• 25:05
  despite the actual people who produce a ton of stuff
• 25:08
  in the economy saying yeah things are like totally fine It really doesn shock me The other component that tell and so we kind of had this bifurcation right And I touch more on that in a second The other thing that suggests the economy is doing quite well you had the labor report that
• 25:26
  came out, non-farm payrolls added, I think like 800,000 jobs more than expected, which is kind of
• 25:32
  wild. And so from that perspective, economy is doing great. How are the consumers doing?
• 25:39
  probably not that hot, right?
• 25:40
  You have a record high credit card debt,
• 25:42
  but that's also a headline you see every month
• 25:44
  because it's only ever rising,
• 25:45
  so it doesn't really matter.
• 25:47
  But look at credit card delinquencies.
• 25:49
  Those are the highest in 17 years.
• 25:51
  Auto loan delinquencies,
• 25:52
  those are the highest of all time.
• 25:54
  So this inflation is beginning to weigh on the consumer
• 25:56
  despite the economy seemingly
• 25:58
  from the outside looking in doing okay.
• 26:00
  And the moment we reach a tipping point
• 26:02
  where because of these delinquencies,
• 26:04
  the consumer cannot afford to borrow their way
• 26:06
  into living anymore,
• 26:07
  then that's the point at which you get a recession. That's the point at which spending does collapse
• 26:11
  and you do have rate cuts back on the table along with money printed and potentially stimulus checks.
• 26:17
  So I tend to take the total opposite side of the argument where people are calling for rate hikes.
• 26:21
  I think there's actually a world where you get tons of rate cuts and stimulus checks this year
• 26:25
  in advance of midterms if we get an inflationary recession. But all of this boils down. All of this
• 26:30
  comes back to the K-shaped economy, right? This notion that as a result of money printing, as a
• 26:36
  result of massive inflationary pressures. And GlobalM2, the global money supply, actually is
• 26:40
  expanding at its fastest rate since 2021 right now. Fun fact, that's really cool for the asset
• 26:45
  owners, right? So the asset owners benefit massively as a result of inflation. It's why
• 26:50
  the Federal Reserve exists to enrich those who own assets and to control the money to control you,
• 26:55
  whereas those who don't own assets don't benefit, right? Think about it this way. For those who
• 26:58
  might not be familiar with this, imagine that there is one pen in the entire world, and I'm
• 27:04
  owner of that pen and there are 50 other people i own the pen nobody else owns the pen this pen is
• 27:09
  worth one dollar right everybody else has ten dollars in their checking accounts whatever so
• 27:15
  you have 50 people with ten dollars in their checking accounts i'm the only only asset owner
• 27:19
  in this economy i've got one pen it's worth one dollar all of a sudden if i decide to inflate the
• 27:24
  money supply by a thousand percent let's say um my pen suddenly is worth a hundred dollars right so
• 27:31
  So my pen is worth $100 or something like that.
• 27:34
  And everybody else's money in their checking account
• 27:37
  is still the same dollar amount,
• 27:39
  but it's not worth as much, right?
• 27:41
  So I have more wealth than they do
• 27:43
  because they didn't have assets
• 27:45
  that were denominated in the thing
• 27:46
  that I just printed a ton of.
• 27:48
  So that's how money works.
• 27:50
  And that's why it's so important to own assets.
• 27:52
  And that's why you see this massive bifurcation
• 27:54
  in the economy,
• 27:55
  where it seems like some people
• 27:57
  are doing absolutely exceptionally.
• 27:58
  You have headline data that's coming in really strong,
• 28:00
  but then under the surface cracks are forming consumer sentiment is the worst than it's ever
• 28:04
  been it's a money problem so in turn in that scenario um rate cuts money printing before the
• 28:11
  end of this year before maybe even midterms how much like what percentage likelihood would you put
• 28:15
  on that i would say uh as of right now because the straight is open i would say no more than 20
• 28:20
  percent um before the straight was open it was like ticking up day by day so i was close to 50
• 28:25
  likelihood that that was occurring, but ultimately cooler heads prevailed. I hope cooler heads
• 28:30
  prevail with the war itself. Hopefully, God willing, I don't want any more people to die,
• 28:35
  but I don't think it's going to happen. I think we reached a sort of a happy middle ground where
• 28:41
  we're still fighting this war, but the strait is open, so the economy will do fine. But unfortunately,
• 28:46
  we're also going to deficit spend a crap ton of money to fund this war. So yeah, I'd say relatively
• 28:51
  low likelihood now that we get that recession. But in my mind, because the straight is open,
• 28:56
  high likelihood that we sort of get that middle ground scenario where inflation doesn't do too
• 29:01
  terribly because now oil is beginning to flow through the straight of Hormuz again. Crude oil
• 29:06
  prices have dropped down to their pre-war levels, which is fantastic. You are going to see the next
• 29:11
  couple of inflation prints tick higher as a result of the lagged impact of this oil shock
• 29:16
  over the next couple of months. But by the end of the year, price inflation is going to be right
• 29:20
  back down where it normally is or within a percentage point or two. Okay. So that's like
• 29:25
  the macro outlook. I want to bring it back a little bit to Bitcoin because you obviously
• 29:29
  saying you think the bottom will be sometime around October, not too much lower, maybe sort
• 29:33
  of low 50s, high 40s. What are the key metrics you're looking at there? Like what's giving you
• 29:39
  that indication? For sure. So there are a number of them. Three big ones that I really, really like.
• 29:44
  The first one being the 200 week moving average, which unfortunately we just broke through,
• 29:49
  which was in the low 60s, high 50s, that is a massive indicator because typically speaking,
• 29:55
  the bottom for Bitcoin bear markets is right around the 200-week moving average. Excluding
• 30:00
  2022, where as I mentioned at the top of the hour, we had a lot of exogenous shocks that caused
• 30:05
  Bitcoin to fall much lower than it probably otherwise would have. Bitcoin tends to bottom
• 30:09
  right around the 200-week moving average. So what I mean to say by highlighting that before I talk
• 30:15
  about the downside levels is that chances are, excluding a massive exogenous shock native to
• 30:21
  Bitcoin, we are already within the realm of the bottom. Now, that brings up the next logical
• 30:26
  question, like what are the downside levels to watch for? Well, the first one that I really,
• 30:30
  really like, and this is sort of in my mind, bottom of the barrel basement price, would be
• 30:36
  the long-term holder cost basis. So this is the level at which the average price at which
• 30:41
  those on the network who have held Bitcoin for more than 155 days purchase their Bitcoin.
• 30:46
  Technically, it's the price at which they last moved their Bitcoin. But for all intents and
• 30:50
  purposes, nobody usually, apart from Bitcoin maximalists like myself and you and everyone
• 30:54
  watching the show, they typically only move Bitcoin when they sell it, right? So it's a
• 30:57
  pretty good indicator of Bitcoin's cost basis for this cohort of people who very rarely sell.
• 31:03
  Currently, that level is at $49,500. So if Bitcoin were to drift extremely low,
• 31:09
  Like that would be the bottom of the barrel price for Bitcoin to go.
• 31:14
  The other level is actually just the normal network wide cost basis, otherwise known as the realized price.
• 31:21
  This doesn't delineate between long term holders and short term holders.
• 31:25
  This is just the average price at which all of the coins on the network were last moved.
• 31:29
  This doesn't factor in coins that haven't moved in decades.
• 31:32
  And so it ultimately does drag the price down a little bit.
• 31:35
  But that said, it still tends to be a relatively accurate reflection of Bitcoin floors or like a fair Bitcoin value for the market.
• 31:43
  And that is currently at $53,000.
• 31:46
  So if you take those two in confluence with one another, then that sort of points to the low 50s, high 40s as being the bottoming range.
• 31:55
  Why do I think we probably won't even visit the 40s?
• 31:58
  So this is something that might age terribly depending on how the next couple of weeks go in markets.
• 32:03
  um bitcoin has never bottomed without touching the long-term holder cost basis however the long-term
• 32:09
  holder cost basis obviously rises over time right now you have to imagine people who've been holding
• 32:15
  bitcoin for over half a year chances are they're like wow this is well below my cost basis i'm
• 32:20
  going to average down these are bottom of the barrel prices we just closed below the 200 week
• 32:25
  moving average we just closed below the power law floor for the first time ever we might not have i
• 32:29
  didn't check that but i think we're close anyone in the show please don't come after me um this is
• 32:33
  a cheap level for Bitcoin. I'm going to stack that. And then guess what? It raises the overall
• 32:38
  long-term holder cost basis. And so the floor will ultimately, in my mind, actually come out
• 32:43
  of the high 40s into the 50s, maybe even 51 or 52K. Reason number two being the fact that
• 32:49
  the structure of Bitcoin's market today is fundamentally different than it ever has been
• 32:54
  in prior cycles. I think I had mentioned this on the last show as sort of the reason why I don't
• 32:59
  think Bitcoin's going to go into the 30s or something crazy like that. And that's because
• 33:03
  the ETFs, right? We harp on this all day long, but the ETFs are ultimately so diamond handed
• 33:09
  relative to normal Bitcoin holders, it's not even funny. They're over two times as likely to hold
• 33:14
  their Bitcoin during a massive drawdown, according to the data, than normal Bitcoin holders. So all
• 33:18
  of the boomers that we like to make fun of, you know, who've been denigrating Bitcoin for years
• 33:23
  and only just started buying, like they're more diamond handed than many of you guys watching the
• 33:27
  show, unless we have boomers who own the ETFs, in which case good on you. But the reality is-
• 33:31
  Is that still the case?
• 33:32
  Because I know there have been outflows,
• 33:34
  like quite significant outflows over the last few weeks.
• 33:36
  Yes, so now we've seen outflows tick up.
• 33:38
  I don't know if I have
• 33:39
  data in front of me. I'll try to pull it up while I'm yapping. Here it is. Okay. Eighth straight
• 33:44
  outflow, $231 million. June has seen a total of $4.3 billion leave the Bitcoin ETFs,
• 33:51
  the largest monthly outflow this year. So yeah, we're starting to see massive outflows. However,
• 33:57
  it is still the case. And also they did hold extremely tough all the way until Bitcoin was
• 34:03
  about high 60s, right? Mid to high 60s, that's when they started selling earnestly. But if you
• 34:11
  take it just from the top of the market to where we are now, the data still tracks, I believe,
• 34:17
  I'll have to rerun the numbers, that the ETF holders are about two times as likely to hold
• 34:21
  their Bitcoin during a massive drawdown than the normal spot Bitcoin holders. And thinking logically,
• 34:27
  it sort of makes sense, right? Think about it this way. If you were a retiree who is allocating
• 34:31
  passively every two weeks to one of the Bitcoin ETFs, right? Or an index fund that holds some of
• 34:39
  the Bitcoin ETFs or tracks them, whatever your work allows you to do. Are you going to be trading
• 34:43
  in and out of those things actively? Probably not, right? Some people do use IRAs and 401ks
• 34:49
  in order to trade in and out of for tax advantages, but we're talking about like
• 34:53
  half a percent of the market, right? The lion's share of the market that is using retirement
• 34:58
  accounts and buying the etfs are just buying every two weeks and then not doing anything with it so
• 35:03
  there is some selling that comes from that cohort of course like we literally are seeing it right now
• 35:08
  however for the most part it's kind of a corner of the market that just holds tough and doesn't
• 35:13
  do much of anything which is really cool like that's what you want for bitcoin to mature as
• 35:17
  an asset from a price perspective uh having lower volatility and so that's one of the reasons uh one
• 35:22
  of the chief reasons other than the fact that the floor is so close the historical floor being the
• 35:27
  the long-term holder cost basis is so close compared to where we are now, but also the fact
• 35:31
  that the makeup of the market, if you will, is just so mature relative to what it has been
• 35:38
  previously that I don't think you're going to see a 70% drawdown this time around. I think we
• 35:43
  probably max out around 65%. We see a bottom around 45K to 50K, and that's that. People,
• 35:51
  again, will say, as they did in 2022, Bitcoin's going much lower, Bitcoin's going much lower,
• 35:55
  Bitcoin's going much less and then it won't. So that's what I'm happy, comfortable planting my
• 36:00
  flag in. I'm happy to lose a little bit of credibility if I'm wrong, but that's how I
• 36:04
  think the cycle plays out. The interesting thing about that number as well around the 50K mark is
• 36:08
  that in the 2021-22 bull market, it was all about trying to figure out if Bitcoin can sustain being
• 36:14
  a trillion dollar market. And it obviously was battling against that level for a long time,
• 36:19
  went way above it up to a $2 trillion market. But this is it testing a trillion dollars again.
• 36:23
  Is there something important about that or is that just sort of a coincidence?
• 36:29
  It's part coincidence, but I'll actually steel man the case for it being important.
• 36:34
  I think Bitcoin being in the top 20 largest assets in the world is something that is only
• 36:39
  going to improve its credibility over time.
• 36:40
  Why do I say that?
• 36:41
  Well, I'm sure we've all seen the clip at this point of that billionaire, something Paul
• 36:46
  Grantham, something Grantham screaming about Bitcoin to Joe Kiernan on CNBC, who's our
• 36:51
  boy.
• 36:51
  We love that guy.
• 36:52
  Hopefully he can come on the show.
• 36:54
  That'd be an excellent episode.
• 36:55
  Who was defending Bitcoin.
• 36:57
  He was saying, Bitcoin's worthless.
• 36:58
  It's worth no more than a chain letter, yada, yada, yada.
• 37:02
  All the stuff you've seen before.
• 37:03
  All the stuff you were hearing about Bitcoin when it was $1,000, right?
• 37:06
  Lo and behold, here we are.
• 37:08
  For every Bitcoin denier who acts like that, there are hundreds of Bitcoin skeptics who
• 37:14
  don't think like that, right?
• 37:16
  They've simply been told or seen or heard or believed that Bitcoin is largely worthless
• 37:21
  through their grapevine. It's a strong opinion they may have, but it's loosely held, right?
• 37:26
  Versus the Paul Granthams of the world, the Warren Buffetts of the world. I think that's his name,
• 37:29
  by the way, Paul Grantham. Anyone correct me in the comments. Versus all of those guys who have
• 37:35
  strong opinions, strongly held. They are so confident that Bitcoin's absolutely worthless.
• 37:39
  For every one of those guys, you have hundreds of people who just think Bitcoin isn't worth much.
• 37:45
  But the more often that Bitcoin is in that top 20 largest assets in the world category,
• 37:50
  the more often that Bitcoin outperforms all of the other crypto in the market, the more often
• 37:55
  that Bitcoin outperforms everything else during these major bull market rallies, which I believe
• 38:00
  we're about to enter into, Bitcoin's about to enter into its next bull market at some point
• 38:04
  later this year, early next year, then the more of those people get converted. So I suppose in
• 38:08
  real time, I just still made the case for why I think Bitcoin above a trillion dollars, or at the
• 38:13
  very least, like the largest individual assets in the world, is actually quite important. Because
• 38:18
  from a credibility perspective that matters quite a bit.
• 38:21
  You wouldn't reuse a Bitcoin address,
• 38:23
  so why does your phone broadcast the same identifier for life?
• 38:26
  Every SIM has a static ID and carriers, ad networks,
• 38:29
  and bad actors all use it to track you.
• 38:32
  The big carriers have been caught selling that data over and over again.
• 38:36
  CAPE is America's privacy-first mobile carrier.
• 38:38
  Their identifier rotation feature changes your ID every 24 hours
• 38:42
  so you look like a different subscriber every single day.
• 38:45
  And SIM swaps are off the table.
• 38:46
  Your number can't move without a 24-word phrase that only you hold.
• 38:50
  There's also no name at sign up, no social security number,
• 38:53
  and there's no profile to build on you.
• 38:55
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• 39:00
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• 39:02
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• 39:06
  That's C-A-P-E dot co forward slash WBD.
• 39:11
  If you hold Bitcoin for long enough,
• 39:12
  there's probably going to come a time when you need some dollars.
• 39:14
  Maybe it's for a business expense, a tax bill, a property purchase,
• 39:18
  but whatever it is, you might not want to sell your Bitcoin.
• 39:21
  That's where Ledin comes in.
• 39:22
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• 39:27
  They've originated over $10 billion of loans since 2018,
• 39:30
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• 39:32
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• 39:34
  so there's no negotiation, no guesswork.
• 39:36
  It's just the larger the loan, the lower the rate,
• 39:39
  and you can see all the rates up front before you apply.
• 39:41
  The important part for me, though, is the custody.
• 39:44
  With Ledin's custodied loans,
• 39:45
  your Bitcoin collateral is never lent out to generate interest.
• 39:48
  You also get all the tools to properly manage the loan,
• 39:50
  including LTV alerts, auto top-ups,
• 39:53
  and the ability to repay whenever you want with no penalties.
• 39:56
  I've used Ledin myself.
• 39:57
  The application has taken me less than 15 minutes
• 40:00
  and you get dollars in your account within hours.
• 40:02
  So you don't need to choose between getting liquidity
• 40:04
  and sticking to your long-term Bitcoin plan.
• 40:06
  With Ledin, you can do both.
• 40:08
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• 40:11
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• 40:15
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• 40:19
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• 40:21
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• 40:22
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• 40:25
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• 40:27
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• 40:31
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• 40:33
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• 40:35
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• 40:38
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• 40:40
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• 40:50
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• 40:53
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• 40:57
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• 41:03
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• 41:07
  okay can we get into the uh the elephant in the room so like who are the buyers who the sellers
• 41:14
  right now and obviously the all the pressure has been on sailor over the last few weeks
• 41:19
  all kind of started when he sold his 32 bitcoin bitcoin price tanked and uh the narrative started
• 41:26
  building around the sort of sustainability of stretch and micro strategy do you want to kind
• 41:30
  of fill us in as to everything that's happened since then yeah so it's wild so i actually went
• 41:35
  on a debate. Last Saturday, we filmed it. And I spoke to one of the most outspoken bears against
• 41:43
  strategy, Vinny Lingham. And his argument boiled down to this against strategy. His argument boiled
• 41:48
  down to, I don't like Saylor because he's a narcissist. And I think he's going to be terrible
• 41:53
  for Bitcoin because he's going to be forced to sell Bitcoin, even though he doesn't have a lot
• 41:57
  of leverage on his balance sheet That what his argument boiled down to And that what the bear I not even being facetious here like rude I have tried to steel man their bear case so so much And I literally sat in front of this guy
• 42:09
  and talked to him about it.
• 42:10
  And that's what his argument boiled down to.
• 42:12
  But to step back for people who might not be aware,
• 42:14
  for people who've been in a coma
• 42:15
  or off Bitcoin Twitter for the last month,
• 42:18
  Saylor sold 32 Bitcoin.
• 42:19
  Now, this isn't the first time he's sold Bitcoin.
• 42:21
  He sold a few hundred Bitcoin
• 42:23
  back at the bottom of the bear market during 2022,
• 42:25
  but it didn't get as many headlines back then.
• 42:27
  Actually it did,
• 42:28
  But because they're a much larger company now, and Michael Saylor is obviously much more famous of an individual, it got more press this time around.
• 42:36
  Selling 32 Bitcoin or selling Bitcoin in general is something that Strategy, Saylor, Fong Lee, they've all spoken about at length numerous times for the last several months leading up to actually selling that 32 Bitcoin.
• 42:49
  So they've been forecasting they intend to sell.
• 42:51
  Why did they wind up selling if they can still raise money in capital markets?
• 42:56
  Well, it's for a very simple reason.
• 42:57
  And that reason is it's one of the three reasons that the S&P Global Committee that not only gives them their credit rating, but determines whether or not they're included in the S&P 500 gave them as to why they're not included in the S&P 500.
• 43:08
  The other two reasons were an over-reliance on capital markets and too much reliance on convertible debt.
• 43:15
  And so what did strategy or and also not rely on capital markets, but not a large dollar reserve.
• 43:21
  So what were the three moves that strategy made over the next few weeks once S&P Global said, hey, we're not going to rate you properly and we're not going to include you in S&P 500 because of these three reasons?
• 43:30
  Well, they addressed all of them.
• 43:32
  First, they built a U.S. dollar reserve.
• 43:34
  Then they retired several billion dollars worth of their convertible debt.
• 43:38
  Now they only have six point seven billion dollars worth.
• 43:40
  All of it is near zero percent.
• 43:42
  The first of it is due at the very end of next year, I believe, actually 2028.
• 43:46
  So 27 months from now.
• 43:48
  And then the third thing they did is they sold their Bitcoin.
• 43:51
  They literally said, you know, we're not going to include you in the S&P 500, but multi,
• 43:55
  multi, multi trillion, 30, 40, 50, 60 trillion dollar market passive inflows up the wazoo
• 44:02
  because you are reluctant to sell Bitcoin in order to fund a dividend.
• 44:06
  So strategy said, OK, we're going to sell Bitcoin to fund a dividend just to prove that
• 44:09
  we can.
• 44:10
  They did.
• 44:10
  the market went insane. I don't believe the seller and Bitcoin sold off massively. I believe those
• 44:16
  two events are disconnected, but at least now you know why sailors sold 32 Bitcoin in case you might
• 44:21
  be unaware. A lot of people, the bear case has been, well, they're selling because they're forced
• 44:26
  to sell like so many people. And this boils my blood. And I've said outwardly on every show that
• 44:32
  I've talked about this, I don't have a material position in micro strategy or strategy, right?
• 44:36
  functionally it's under a thousand dollars like point less than point five percent of my portfolio
• 44:41
  i don't own any stretch why am i being so outspoken about this company being fine and
• 44:47
  not being a systemic risk to bitcoin well because i just it it boils my blood when i see people just
• 44:52
  lying through their teeth like words actually have meaning what do i mean by that well a lot of the
• 44:57
  people who've been uh bear posting about strategy and sailor have been using the word death spiral
• 45:02
  Peter Schiff coined it. He did a podcast about a month ago saying that strategy is about to enter
• 45:06
  into a death spiral. I love James Lavish, great friend of the show, both you and I, Danny.
• 45:13
  Good on him for not coining death spiral, but bringing it into the mainstream lexicon as far
• 45:18
  as this corner of the internet is concerned, but so many people are misusing it. A death spiral
• 45:23
  means you have way too much debt on one side of your balance sheet in order to service it.
• 45:28
  So to service it, you issue even more debt.
• 45:31
  The rate on that debt goes up
• 45:32
  because your credit worthiness declines.
• 45:34
  And so you need to issue more debt for that.
• 45:36
  And it's a never-ending spiral of increasing debt issuance
• 45:38
  because of the ever higher interest rate
• 45:40
  that you have to pay on it
• 45:41
  and no other way of funding your obligations.
• 45:43
  Strategy definitionally cannot be in a debt spiral.
• 45:47
  Number one, because the remaining convertible debt
• 45:49
  they have not only isn't due until 2028,
• 45:51
  but is also only 11% of their balance sheet
• 45:54
  and has a 0% interest rate.
• 45:56
  So in order for strategy to be in a position
• 45:59
  where they were forced to sell Bitcoin,
• 46:01
  several things would have to happen at once.
• 46:03
  I promise I'll get to what's happening now with strategy,
• 46:05
  but several things would have to happen at once.
• 46:08
  Number one, Bitcoin would have to crash by about 89%
• 46:11
  and stay there for the next two and a half years
• 46:13
  or the next 27 months.
• 46:15
  So that way the debt on their balance sheet
• 46:18
  matched their obligations, match their assets,
• 46:21
  the Bitcoin they hold perfectly, one-to-one.
• 46:23
  Then they would also need to not sell a single dollar from their US dollar reserve, which now
• 46:29
  has 17 months worth of dividend coverage in it, right? As of yesterday. And then on top of that,
• 46:35
  they would need to not be able to tap the capital markets for one single dollar,
• 46:39
  despite proving the fact that they've been able to tap the capital markets for over $60 billion
• 46:43
  over the last four years. Oh, and to top all of that off, they would not only is their convertible
• 46:50
  debt not due until 2028, 27 months from now, but it's due in five separate tranches or six separate
• 46:56
  tranches over the next four years after that. So Bitcoin would have to crash by 89% and stay there
• 47:03
  and strategy would have to not sell a single dollar from its US dollar reserve and they would
• 47:07
  not be able to attack capital markets at all. So like when you put it that way, it sounds really
• 47:12
  ridiculous. All of the strategy. So the last thing I'll say here, and then I'll get to the latest
• 47:17
  updates, is that a lot of people think that the preferred equities, such as STRC, are
• 47:24
  dead.
• 47:25
  They're not, right?
• 47:26
  And obviously, Saylor isn't going to suspend the dividend.
• 47:29
  He's not going to cut the dividend to 4%, 3%, something more manageable for him.
• 47:35
  He's even raising it, right?
• 47:36
  Which is good, right?
• 47:37
  Because when fixed income instruments sell off, it's literally just the market telling
• 47:40
  you they want a higher yield.
• 47:41
  So that's what Saylor is giving them.
• 47:43
  This is the opposite of a debt spiral.
• 47:44
  But anyway, because the preferred equities are not debt, they're not an obligation, so they will never be forced to sell Bitcoin to fund them.
• 47:53
  In a worst-case scenario, and I'm not saying this would happen, Saylor could suspend the dividend, right?
• 47:59
  He's not going to do that.
• 48:00
  He doesn't need to do that because it just laid out the case for why strategy would never need to do that based on their current capital structure.
• 48:07
  11% leverage ratio, $50 billion worth of Bitcoin on their balance sheet, 18 months worth of cash
• 48:13
  dividend coverage. And the other thing, I promise I'll wrap all this up in a bow, is STRC, this is
• 48:19
  the major thing I'm sure we'll chat more about it, is a lot of people have been likening STRC
• 48:25
  to TerraLuna. For those who are unaware, TerraLuna was an algorithmic stablecoin that was around
• 48:31
  during the bear market of 2022, it collapsed. During the summer of 2022, an algorithmic stable
• 48:37
  coin essentially means on one side, you have the stable coin. On another side, you have a crypto
• 48:42
  token that can be minted or burned out of thin air in order to make sure that the price of the
• 48:48
  stable coin stayed around $1. Well, a lot of people were levering up on one side in order to
• 48:55
  arb the difference between the price differential and $1. Once the price began moving very much
• 49:03
  against that asset, people got liquidated. They were forced to sell. The amount of this crypto
• 49:08
  token that needed to be minted into existence rose quite a lot, and that drove more for selling,
• 49:14
  so on and so forth. And so effectively, you had this useless crypto token inflated into infinity,
• 49:19
  and this algorithmic stablecoin, which was supposed to be pegged around $1,
• 49:22
  completely collapses a result. STRC is nothing like that. For one, it is a NASDAQ listed instrument.
• 49:30
  Granted, there's some junk listed on the NASDAQ. I won't lie. But strategy is a balance sheet that
• 49:35
  is $50 billion, like 28 years of runway from a Bitcoin perspective for all of their dividends.
• 49:41
  And that's if Bitcoin doesn't move at all. Not only that, but it's not an algorithmic stablecoin.
• 49:46
  It's not a stablecoin. It has no peg. That's one of the other things that a lot of people have been
• 49:51
  saying. They said, oh, STRC has de-pegged from $100. Well, here's the deal. It's supposed to
• 49:57
  float around $100. That's the truth. And that's why they're raising the yield in order to make it
• 50:01
  so that it drifts higher, closer to that $100 mark. But there's no peg. It's not pegged to $100.
• 50:07
  A lot of the death spiral folks, the financially illiterate people who need to buy Finance for
• 50:12
  Dummies, you can literally pirate it for free to search Finance for Dummies PDF online,
• 50:17
  have been saying that STRC de-pegged,
• 50:20
  strategies entering into a death spiral, all this stuff.
• 50:24
  It couldn be further from the truth Sorry if that was a bit of an off the rails defense of strategy and what happened but that why they sold 32 Bitcoin That what happening with STRC and strategy
• 50:35
  STRC falling from where it was poses no risk to strategy.
• 50:39
  It poses no risk to Bitcoin.
• 50:41
  Everything's fine.
• 50:42
  We're just close to the bottom of a bear market and people are searching for a villain and
• 50:45
  Michael Saylor tends to be a convenient one.
• 50:47
  I disagree with some of the stuff you said, though.
• 50:49
  I think when you said everything's fine, I don't think this shows that everything's
• 50:53
  fine like i think the market is clearly saying like you like you said earlier the the yield
• 50:58
  that they're offering is just nowhere near high enough um like i think again i agree it's obviously
• 51:03
  a hundred dollars is not a peg but it kind of gets into semantics like that is the par value of this
• 51:07
  preferred um it's where sailor wants it to be trading and it's currently trading at like 84
• 51:13
  dollars like that shows that our value is one cent but i do agree in in the prospectus but i do agree
• 51:19
  with you that yes it should be trading around 100 what is that do we need to get into that or is that
• 51:24
  not important no no it's not important not okay okay but so it does show that something's not
• 51:30
  quite right here and and i don't know exactly what that is i think maybe it's when there was
• 51:35
  kind of a race to see who could offer the dividend payments the most regularly everyone's kind of
• 51:40
  sided with sata because it was doing daily dividend payments and then like stretch broke
• 51:44
  down like why do you think this happened is it just over leverage or is there something deeper
• 51:48
  right so i think i mean you you started to see strc trade down a lot once sailor sold that 32
• 51:55
  bitcoin i don't think him selling 32 bitcoin is what caused that massive bitcoin sell off when he
• 52:00
  announced the sale at like 68k all the way down to like 62k um i think that that was more geopolitical
• 52:05
  stuff happening we were approaching a deal then we bombed them again and we were approaching another
• 52:09
  deal then we bombed them again combined with a leverage flush um i do think there was some selling
• 52:14
  at the margin. But regardless, what sailors selling 32 Bitcoin did do is it drove STRC to
• 52:19
  sell off massively. You pair that with all of the sensationalist headlines, it sells off even more.
• 52:24
  But I think the broader reason that it sold off is quite simple. I think people are just demanding
• 52:28
  a higher yield for this instrument. Now, the reason behind that, we can speculate. There are
• 52:34
  a couple of reasons. I think the most probable, obviously, there was some mania around the selling,
• 52:38
  right? People selling because they were panicked. But largely, over a long enough time horizon,
• 52:43
  markets are efficient. They might not be right, but they're somewhat efficient, right? Market
• 52:47
  inefficiencies are how we make money. If everybody knew about the Fed printing a ton of money,
• 52:51
  Bitcoin would be, you know, a billion dollars a coin, but it's not. And that's the opportunity.
• 52:55
  Similarly with STRC, I think the market was just saying they wanted a higher yield.
• 52:59
  In my mind, that's because Bitcoin is closer to its bottom and its forward returns over the next
• 53:06
  six months, 12 months, two years, five years are going to be higher on a year over year basis as a
• 53:11
  results of it being closer to the bottom than not. So just to illustrate an example, Bitcoin's
• 53:16
  compound annual growth rate from $70,000 a couple of months ago, all the way up to a potential cycle
• 53:21
  high of $40,000, or excuse me, $400,000, would be something like 31%, 32%, right? But from a cycle
• 53:30
  low of $58,000 where we are now, that's a forward compound annual growth rate of like 41%, 42%,
• 53:37
  45%. And so naturally, if strategy's business model is buying Bitcoin, buying this asset with
• 53:44
  a high CAGR on one side, issuing preferred equities and paying a yield on the other side,
• 53:48
  and then capturing the difference, basically, in my mind, this is simply investors, apart from the
• 53:53
  panic selling, of which there was a lot, it's simply investors writ large saying, hey, we project
• 53:58
  the forward returns of this thing to be larger. So we want to be compensated more fairly and get
• 54:03
  more of the return, if that makes sense. In my mind, that's obviously what it was, but who knows?
• 54:08
  Yeah, no, that does make sense. I do think the other thing that played into this, though,
• 54:12
  is when they retired the converts with the cash that was like from everything that I had seen,
• 54:17
  it seemed like that cash was being saved to pay dividend payments in the future.
• 54:21
  And so when they used a lot of that cash to retire preferreds, like I think the market was
• 54:26
  probably a bit shaken by that. I understand the idea of why he did that. He wants to be included
• 54:32
  in the S&P index, but it seemed like a misstep to me. I don't know if you agree with that.
• 54:38
  I tend to agree. I think it definitely, here's my thinking. It's tough to get into the head of a guy
• 54:42
  like Michael Saylor, but here's my thinking. All of their guidance, right? They're the Bitcoin
• 54:48
  central bank. They offer forward guidance, just like the Fed. I'm kidding, of course. Bitcoin has
• 54:52
  to know a central issuer. But for all intents and purposes, he was telling the market, hey, look,
• 54:56
  we're going to raise this US dollar reserve so that way we could pay down dividends. He even had
• 55:00
  that like spaceship graphic that a lot of people were saying, look, it's a pyramid scheme. Anyway,
• 55:04
  that was the intention of the US dollar reserve. But then like three or four weeks later, the S&P
• 55:09
  global committee comes out and says, yeah, we're not going to include you in the S&P 500. And you
• 55:12
  get a B minus credit rating despite being over collateralized because you have an over-alliance
• 55:18
  on convertible debt, right? And so sailor immediately went, no, we want to get in the
• 55:22
  S&P 500, retire it right now, right? And so the dollar reserve that was set aside for dividend
• 55:26
  payments, he decided to grab it, sell off more than half of it, and use it to pay down those,
• 55:32
  or buy back those converts rather. So from a guidance perspective, because he did something
• 55:40
  the market wasn't expecting, I definitely think that, I don't know if it was necessarily the wrong
• 55:44
  move, but what I'll say is that from a long-term capital structure perspective, I think it was good,
• 55:48
  particularly because those had like 6.5% interest rates compared to the zeros that they left on.
• 55:53
  But I think from a timing perspective and a communication perspective, it totally spooked
• 55:58
  the market.
• 55:58
  And I definitely think that it led to some of the sell off.
• 56:00
  And it's also, I think, one of the chief reasons that they decided to recapitalize the US dollar
• 56:06
  reserve up to about a year and a half worth of dividend coverage.
• 56:09
  So I think they recognize they made a mistake and tried to amend it.
• 56:12
  Yeah.
• 56:13
  So that's the thing they came out with a day or two ago, which is increasing the US dollar
• 56:18
  reserve.
• 56:19
  Is it 17 months of runway they've got at the moment in terms of paying the dividends?
• 56:23
  they've got a monet like a bitcoin monetization scheme like basically they're going to start
• 56:29
  selling bitcoin which i actually think is a good thing like i i think they should if they need if
• 56:34
  they need to sell bitcoin to get money to pay the um monthly dividends or bi-weekly dividends or
• 56:39
  whatever like they should do that like why do you think that's been looked at so unfavorably by the
• 56:44
  market yeah so i think that and i said this a couple of weeks ago i love this topic so much
• 56:50
  because it shows who is like a sensationalist
• 56:53
  and who is a little bit more rational.
• 56:55
  Even folks like Andy Constant on X,
• 56:57
  like the biggest strategy detractors out there
• 56:59
  have been saying like,
• 57:00
  I don't get what all the fuss is about
• 57:02
  for sailors selling Bitcoin.
• 57:03
  Like I don't, why are people, anyway,
• 57:05
  it shows who is being a sensationalist
• 57:08
  and trying to get views just for the sake of that
• 57:10
  versus who's looking at this rationally.
• 57:13
  The market was spooked.
• 57:14
  And I said this several weeks ago,
• 57:15
  the market was hugely spooked by sailors selling 32 BTC.
• 57:19
  They weren't expecting it.
• 57:20
  It came suddenly, even though he forecasted it,
• 57:22
  but it came suddenly,
• 57:23
  the first time he has done it in three and a half years.
• 57:26
  But then Saylor went and said,
• 57:27
  you know what?
• 57:28
  We're going to establish a Bitcoin monetization framework
• 57:31
  to just formalize this thing that we've been discussing.
• 57:34
  And we're going to make it so that we're authorizing ourselves
• 57:37
  to sell up to $1.25 billion to cover dividend interest.
• 57:40
  Whoa, that's a lot more than the like 10 million something
• 57:44
  from the 32 Bitcoin that he just sold.
• 57:47
  The market didn't move an inch.
• 57:48
  In fact, strategy went up, STRC went up, and Bitcoin went up yesterday. It's down now for
• 57:53
  other reasons. But Bitcoin went up, right? So clearly the market really likes the idea of
• 57:58
  selling Bitcoin. The 32 Bitcoin sale was ripping the bandaid off and priming the market for what's
• 58:02
  to come. What's to come isn't forced selling, right? I already went through why strategy will
• 58:08
  never be forced to sell Bitcoin. Well, not never, but the likelihood that they'll ever be forced to
• 58:12
  sell Bitcoin is extremely low. More like systematic selling, right? And this is sort of the end game,
• 58:19
  the end state of the machine I just described a moment ago and why I believe Strategy will always
• 58:23
  be a net buyer of Bitcoin. Effectively, and this is kind of the strategy thesis that we've been
• 58:27
  talking about ever since they launched the Preferreds. At first, when there were no Bitcoin ETFs,
• 58:32
  Strategy was sort of the de facto Bitcoin ETF. Hey, we're a public company. We have a relatively
• 58:36
  small software business, but most of what we do is buy Bitcoin. If you want Bitcoin exposure with
• 58:41
  a little bit of leverage by us.
• 58:43
  And then the ETFs came out.
• 58:44
  No reason to own strategy anymore.
• 58:47
  And so strategy was effectively bringing Bitcoin to the trillion equity market right Now they launched the preferreds right They began launching the preferreds two summers ago And here we are June 2026
• 58:59
  tapping into a much larger market,
• 59:00
  the $300 trillion plus global fixed income market,
• 59:03
  and even a little bit of the real estate market.
• 59:05
  Investors who either have mandates
• 59:07
  to not be able to buy Bitcoin,
• 59:10
  get direct Bitcoin exposure,
• 59:11
  and also people who might have
• 59:13
  a slightly lower risk profile
• 59:14
  and want Bitcoin exposure
• 59:15
  and a little bit of that upside,
• 59:17
  but without needing to hold this high growth.
• 59:18
  asset. Like fixed income is the largest market on earth for a reason. There's a huge demand for
• 59:23
  those things. And so strategy effectively, what they're doing with the preferreds by buying a ton
• 59:27
  of Bitcoin and then funding it by offering an asset that yields anywhere from 8% to 12% with
• 59:33
  STRC now after this latest dividend raise that's coming up, is they are tapping into a market that
• 59:40
  otherwise could not or would not purchase BTC. And they're using the demand from that market to
• 59:45
  fund Bitcoin purchases. Effectively, what you've got, and I just described this a moment ago,
• 59:49
  is a Bitcoin transmutation machine. On one side, you've got this high growth asset doing anywhere
• 59:54
  from $20 to $35 annually over multi-year timeframes. And then on the other side, you've got
• 59:59
  a funding mechanism, STRC and others, preferred stocks that are offering anywhere from 8% to 12%.
• 1:00:06
  And the spread between the two is strategy's business model. They're using this demand to
• 1:00:11
  fund purchases of this thing. And then, and this is the part that they haven't been doing yet,
• 1:00:15
  and it's the reason people have called them a Ponzi scheme,
• 1:00:17
  sell enough of this thing to fund this thing.
• 1:00:20
  That's what they haven't done to this point.
• 1:00:22
  But this finally closes the loop, right?
• 1:00:25
  Because to this point,
• 1:00:26
  they have funded new Bitcoin purchases
• 1:00:28
  by issuing more STRC,
• 1:00:29
  but they've also funded STRC dividend payments
• 1:00:33
  by issuing more STRC and MSTR, their common stock.
• 1:00:36
  By selling the necessary amount of Bitcoin
• 1:00:39
  to fund STRC dividends,
• 1:00:41
  the Ponzi allegations go away completely.
• 1:00:44
  Because on this side,
• 1:00:45
  they have a productive asset that is funding the dividend. All of a sudden, you can't call them a
• 1:00:49
  Ponzi scheme anymore. And the only issue people can logically take with strategy is believing that
• 1:00:56
  Bitcoin cannot go up indefinitely or it cannot maintain that really high compound annual growth
• 1:01:00
  rate, right? The Ponzi allegations go away entirely. Strategy sort of enters into its final
• 1:01:05
  form where it is a net buyer of Bitcoin over time. It's buying a ton of Bitcoin using the demand for
• 1:01:10
  this instrument. This is doing 30%. This is doing 12%. They sell enough to fund the 12%. They
• 1:01:15
  keep the rest and the machine keeps running. It's much more sustainable in the long run, in my mind.
• 1:01:19
  And the last thing I'll say here, it's very telling that the market did not sell off.
• 1:01:25
  On the news that strategy intends to sell $1.25 billion of Bitcoin, it's very telling that the
• 1:01:30
  market did the opposite. It went higher, right? Because this is what the market wants. In the
• 1:01:34
  market's eyes, this is a much more sustainable business model. In my eyes, this is a much better
• 1:01:38
  business model. And I'm very happy that they're taking this step. Yeah, I think it's a better
• 1:01:42
  business model i think the market will panic as soon as they actually sell again um but but like
• 1:01:48
  i think as of right now the total payments that they need to make is just under two billion dollars
• 1:01:53
  a year like the bitcoin market can sustain two billion dollars being sold across 12 month period
• 1:01:58
  like that's easy that's nothing yeah um like i think it's a good idea too um i don't necessarily
• 1:02:03
  know why you would hold mstr anymore but like i have a bias in this because i just like holding
• 1:02:09
  Bitcoin. But it seems like the Bitcoin is going to get sold down from the reserve. Obviously,
• 1:02:14
  they're going to be stacking as more and more people come into the preferred. But then anytime
• 1:02:17
  that there's an opportunity for them to go in and hit the ATM and dilute shareholders,
• 1:02:21
  they're going to do that. It seems very clear. I think the idea of getting to a 3XM nav is
• 1:02:26
  history. I don't see how that ever happens again. And I mean, we're nearly at the flippening.
• 1:02:32
  The stretch is $84 and MicroStrategy is $86. That's the real flippening.
• 1:02:37
  I love it. Real flippening. Never happened with Ethereum, but it happened here.
• 1:02:42
  Yeah. Why do you think anyone would want to hold MSTR?
• 1:02:46
  Yeah. I mean, I think the bull case for MSTR is it's now less of a Bitcoin proxy and more of a
• 1:02:51
  true Bitcoin operating company. So Jack Mallers is getting what he wanted out of Saylor in that
• 1:02:57
  they're using Bitcoin's monetary properties and its growth to create a financial product that is
• 1:03:02
  tied to that. Right. So in the past, the reason you buy strategy is because they lever up Stackathon
• 1:03:07
  of Bitcoin, they outperform Bitcoin. Now, I believe there is a world where they can outperform
• 1:03:12
  Bitcoin. However, it's going to be not as a result of the leverage they have on their balance sheet,
• 1:03:17
  but as a result of the service they're providing, right? In the same way that you invest in Apple
• 1:03:21
  because the iPhone is a product that sells really well and you want exposure to that company,
• 1:03:25
  you buy strategy because all of these different fixed income products always sell very well,
• 1:03:30
  particularly SCRC, sells extremely well, they're offering a valuable service,
• 1:03:34
  and you want exposure to the company, not because of the levered Bitcoin exposure,
• 1:03:37
  Obviously, that's nice, but because of the service they provide, right?
• 1:03:41
  And I think in that universe, too, Bitcoin holders are also quite happy because, and I agree with you here, Danny, a lot of people view MSTR as a Bitcoin alternative.
• 1:03:49
  It's not, right?
• 1:03:50
  I want to be abundantly clear to anyone listening.
• 1:03:54
  MSTR effectively, at that stage, fully steps into becoming a Bitcoin company, right?
• 1:03:59
  It's core to what they are.
• 1:04:00
  You're not buying MSTR as a result because you want, you know, levered Bitcoin exposure or as an alternative to your Bitcoin.
• 1:04:06
  it's something to buy in addition to your bitcoin as a small portion of your stack if you believe
• 1:04:11
  that this company is providing a valuable service and you want exposure to that equity over time i
• 1:04:15
  think that's how the story flips and i think maybe that's what causes the the strategy haters to
• 1:04:22
  finally flip and but we'll see i think they're just just like peter schiff hates bitcoin completely
• 1:04:27
  irrationally i think there will always be some people who hate on this company completely
• 1:04:31
  irrationally, but we'll see. Just a quick question for you. So the dividend rate went to 12%.
• 1:04:37
  It's currently trading at like just over $84. How high do you think it'll have to go to get back to
• 1:04:43
  the $100 benchmark? That's a good question. Looking right now at the effective yield,
• 1:04:49
  when STRC is trading at $84, it bottomed out, I think, in the mid-70s, around $74, $75. Now it's
• 1:04:56
  back up to 84 on the dividend announcement for 12% up from 11.5%. The effective yield is at 14.14%.
• 1:05:05
  So those things are coming closer to each other. The effective yield and the dividend are coming
• 1:05:10
  closer to each other. What you want is for those to be as close as possible, meaning STRC is as
• 1:05:14
  close to 100 as possible. The effective yield was 15.5% three days ago. And so after strategy
• 1:05:21
  established their monetization framework and they announced the dividend increase, clearly the market
• 1:05:25
  is not only more comfortable with the corporate risk associated with strategy, but they also think
• 1:05:30
  12% sounds much more reasonable. And so I think chances are maybe one more rate increase and you
• 1:05:35
  see the convergence of those two things, but it could be even higher. It could be 13%, which
• 1:05:40
  sounds insane. But number one, Strive is doing it. They're totally fine. They have a lot of trading
• 1:05:44
  volume. And number two, again, the forward returns of Bitcoin, ostensibly because we are very close
• 1:05:50
  to the cycle bottom, are much higher than they would be if we were in the middle of the bear
• 1:05:53
  market, right? So investors are demanding a higher percentage. And from that, and as a result,
• 1:05:59
  in my mind, that'll be fully sustainable going forward. Obviously, if and when they do increase
• 1:06:04
  the dividend to like 12.5%, 13%, you will see headlines saying, oh, they're getting desperate
• 1:06:09
  now, folks. They're about to blow up. This is not the case. So I think, long story short,
• 1:06:14
  probably one or two rate increases, but we'll have to see what happens.
• 1:06:18
  All right, Joe, this has been awesome. Parting advice for anyone who's panicking through their
• 1:06:23
  their first Bitcoin bear market, what should people be doing right now?
• 1:06:27
  Well, first and foremost, welcome. And you're watching a great show for it. What Bitcoin did
• 1:06:31
  is the prime spot to be during a Bitcoin bear market. What I'll say is this, like ultimately,
• 1:06:38
  if you find yourself in a position where you need Bitcoin to go up before a certain date,
• 1:06:44
  or you cannot have Bitcoin fall to a certain level, otherwise you lose money,
• 1:06:49
  then I would say reconsider your strategy. Take off some of the leverage. Just buy spot Bitcoin
• 1:06:54
  and hold it. Like it's really simple, guys. It's simple, but it's not easy. Right. And for those
• 1:06:58
  of you who might be sitting in spot and still feeling the pain, I understand I've been there
• 1:07:03
  too. Danny's been there too. Everybody watching this show has been there too. It's a difficult
• 1:07:06
  thing. But the fact of the matter is, regardless of what's happening right now, nothing has changed
• 1:07:11
  about the underlying Bitcoin thesis or its performance relative to the rest of the market.
• 1:07:15
  Bitcoin is still the best performing major macro asset over the last,
• 1:07:18
  decade, even down 50%. It beats every other major macro asset that's within a mile of it,
• 1:07:24
  right? From a yearly percentage perspective, it's still the 15th or 16th largest asset in the world,
• 1:07:29
  storing $1.1 trillion worth of value, or like, you know, $1 trillion worth of value.
• 1:07:34
  Over time, it has proven to be the best store of value, definitionally, in the market. And it just
• 1:07:41
  tends to do this. So the final thing I'll say is that, obviously, people telling you to zoom out,
• 1:07:47
  it gets old, right? Zoom out and understand where we are and why Bitcoin exists.
• 1:07:51
  You can see the white paper behind me. My camera isn't high enough resolution for people to zoom
• 1:07:55
  in. But the reason I have this behind me, in the Genesis block, the inscription from the article
• 1:08:02
  in the Genesis block said, Chancellor, I'm bringing for second bailout for banks, of second
• 1:08:06
  bailout for banks. That was in regards to the UK financial crisis happening around the same time
• 1:08:09
  as the US financial crisis, obviously it was global. And the reason that headline was chosen
• 1:08:15
  was very simple and that's because the fed cannot stop printing money global central banks cannot
• 1:08:20
  stop printing money out of thin air and not just printing money but printing money at an accelerating pace that is why bitcoin exists it is an absolutely scarce monetary asset that has absorbed and will continue to absorb the excess liquidity the excess money
• 1:08:33
  printing that global central banks just can't stop printing, right? So as long as that remains
• 1:08:38
  the case, as long as central banks keep printing money, Bitcoin's value prop remains unchanged.
• 1:08:43
  And a 50% drawdown isn't something that should scare you. It should be viewed as an opportunity
• 1:08:46
  and nothing more. I love it, man. Joe, what a way to end the show. Tell everyone where they can go
• 1:08:52
  and check out, you've got your YouTube channel's crushing. Where can they check out all the work
• 1:08:56
  that you're doing? Absolutely. Well, Danny, thanks so much for having me on. If this is a
• 1:08:59
  collaboration, you can just go down there, click my name, click subscribe, or before you do watch
• 1:09:05
  some of the videos, or you can just search my name, Joe Consorti up there in the search bar.
• 1:09:08
  If you're listening on audio, you can just go to Google, Google Joe Consorti. You can find me there.
• 1:09:14
  Awesome. Thank you, man. I will speak to you soon. We've got to do this again. That was really cool.
• 1:09:18
  Absolutely. Thanks, Danny. I appreciate it. Bye-bye.
• 1:09:22
  you