Latest / The Paul Barron Crypto Show / Inflation Out of Control?📈Rate Hike + SpaceX IPO Incoming🔥

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Inflation Out of Control?📈Rate Hike + SpaceX IPO Incoming🔥 · The Paul Barron Crypto Show

0:00
Speaker 1: Inflation continuing to hold up, and of course all of
0:02
Speaker 1: this is happening during the SpaceX week we'll talk about that.
0:06
Speaker 1: It is out of control, guys. But before we get started,
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0:47
Speaker 2: Let's get into it today.
0:48
Speaker 1: I want to start off with Ted Pillows and I
0:50
Speaker 1: love this. I love Ted Pillows just because I love
0:53
Speaker 1: the ex account cracks are appearing and of course big
0:57
Speaker 1: players going risk off. The real capitulation did not happen,
1:00
Speaker 1: and yet I agree with this one hundred percent. We
1:02
Speaker 1: are in I think denial phase. I would agree with
1:06
Speaker 1: what we're hearing from a lot of as commentors is
1:08
Speaker 1: that that is the phase that we're in right now.
1:11
Speaker 1: I want to go to a clip here that kind
1:12
Speaker 1: of goes into where the situation is around SpaceX, because
1:16
Speaker 1: this will start to put some pressure, I think on
1:18
Speaker 1: the market.
1:18
Speaker 3: Take a look, SpaceX is ipo is almost four times oversubscribed,
1:23
Speaker 3: and sources of told Reuters it's drawn more than two
1:25
Speaker 3: hundred and fifty billion dollars of investor demand.
1:28
Speaker 4: As far as the expectations and the hype for the IPO,
1:31
Speaker 4: I do also think that that four times oversubscribe number.
1:34
Speaker 4: A lot of that has been driven by the hype
1:36
Speaker 4: that has been driven by the book runners, by Elon
1:39
Speaker 4: himself and by the media in just drumming up interest
1:42
Speaker 4: in this. So nobody expects to get their full allocation,
1:45
Speaker 4: so they probably bid for more, and some admittedly think
1:48
Speaker 4: the evaluations are extraordinarily high and perhaps extreme, but want
1:53
Speaker 4: to just be a part of the action, a piece
1:55
Speaker 4: of the action, knowing perhaps at that small amount that
1:58
Speaker 4: they do get allocated not make a big dent in
2:01
Speaker 4: their portfolio. So I think there's a lot of speculation
2:04
Speaker 4: going on like that. Where is it coming from maybe
2:06
Speaker 4: from Bitcoin. We'll probably see some pull away from that,
2:09
Speaker 4: but that tells you something if that is coming away
2:11
Speaker 4: from Bitcoin. Arguably the most speculative piece in an acid
2:15
Speaker 4: allocation today, the piece that has no history as to
2:18
Speaker 4: how it performs, that's the money that's going into the
2:21
Speaker 4: SpaceX ipo. I think that tells you investors are not
2:24
Speaker 4: treating this like any other equity.
2:26
Speaker 1: All right, So, just to kind of comment on what
2:28
Speaker 1: she was saying, there a little bit of pushback. I
2:30
Speaker 1: think that this is actually coming maybe from the broader market,
2:33
Speaker 1: and maybe not necessarily the top or the mag seven,
2:36
Speaker 1: but definitely within a lot of companies that people have
2:39
Speaker 1: already taken profits on or are looking to take profits on.
2:42
Speaker 1: Bitcoin may have some of this in terms of liquidity
2:45
Speaker 1: injection into SpaceX, but I think all of this is
2:47
Speaker 1: still the broader markets supporting or getting ready for what
2:51
Speaker 1: will be a major launch on the spacexipo. So much
2:55
Speaker 1: so that Senator Warrench comes on and says she just
2:58
Speaker 1: called the SEC to block the SpaceX. Her reasons, she
3:01
Speaker 1: cited three concerns, unchecked control over the company, governance, risk
3:06
Speaker 1: on public investors that I definitely agree with. There, I'm
3:09
Speaker 1: not agree with Warren, but I agree that they shouldn't
3:12
Speaker 1: have changed all these rules to where these you know,
3:15
Speaker 1: investment funds automatically invest into this and you have no
3:18
Speaker 1: choice or option to not do that. And the possibibility
3:21
Speaker 1: of Chinese investment in company that's one of the biggest
3:24
Speaker 1: and most critical defense contractors, that's a big factor here.
3:27
Speaker 2: I would like to know more about that.
3:29
Speaker 1: I'm not aware of major Chinese investment, but I wonder
3:33
Speaker 1: if there is something brewing there. To kind of go
3:37
Speaker 1: around where she's talking, I want to go to the
3:39
Speaker 1: clip where she breaks down this warning letter to the SEC.
3:42
Speaker 5: Elizabeth Warren. In this letter, citing a number of factors
3:46
Speaker 5: she says warrant a delay in the IPO, including the
3:49
Speaker 5: company's valuations. She says market analysts have raised concerns about
3:53
Speaker 5: the math underlying SpaceX's target valuation. She raises concerns about
3:57
Speaker 5: governance structure, saying publicly traded companies are meant to be
4:00
Speaker 5: accountable to their shareholders. The SpaceX IPO will flip this
4:04
Speaker 5: model on its head. The SpaceX IPO creates a new
4:07
Speaker 5: concern that major stock market indexes are being rigged in
4:11
Speaker 5: a way that would force millions of investors in passive
4:14
Speaker 5: index funds, a generally lower cost investment option that can
4:17
Speaker 5: be attractive to retail investors to invest in SpaceX and
4:21
Speaker 5: face exposure to SpaceX is significant risk with no choice
4:25
Speaker 5: in the matter. So that from Elizabeth Warren. The political
4:28
Speaker 5: reality is that Donald Trump's sec not likely to take
4:31
Speaker 5: Elizabeth Warren's advice here on this IPO on Friday. But
4:35
Speaker 5: I think it does signal some concerns out there in
4:37
Speaker 5: the investing in community, and if Democrats are to be
4:39
Speaker 5: successful in the midterms, you could proceed some static for
4:43
Speaker 5: the company after November. Guys, back to you, I mean
4:46
Speaker 5: the series.
4:47
Speaker 6: Has now a lot of time thinking about what they
4:49
Speaker 6: should do and what they shouldn't do, and the idea
4:52
Speaker 6: that it's rigged. I think this a very strong war
4:55
Speaker 6: and hopefully agree with you that.
4:57
Speaker 1: All right, guys, rigged, I think, yeah, you have to
5:00
Speaker 1: look at just the modifications that were made to out
5:03
Speaker 1: allow this IPO to happen under these new rules and guidelines.
5:07
Speaker 1: There's been a lot and definitely when you look at
5:09
Speaker 1: the funds that will have access to this, that is
5:11
Speaker 1: the concern. The other thing that's happening, though, is the
5:15
Speaker 1: fact that we're seeing this spread across a lot of
5:17
Speaker 1: different varieties of markets, and that is including a two
5:20
Speaker 1: x SpaceX ETF now launching the same day as the ipo.
5:25
Speaker 1: Man talk about people piling on.
5:27
Speaker 2: This is going to.
5:28
Speaker 1: Be most likely just the first of many different programs
5:34
Speaker 1: launching around this. And not only that, let's look at this.
5:38
Speaker 1: The deadline now to submit your IPO spacexipo share request
5:42
Speaker 1: has now changed to today at four pm, and that
5:45
Speaker 1: is coming in for robinhood users. Just remember that there
5:48
Speaker 1: is that thirty day cycle thing that puts you into
5:50
Speaker 1: a little bit of a situation where you can't get
5:52
Speaker 1: into another IPO if you cycle a share, meaning you
5:55
Speaker 1: buy it now, sell it before thirty days. So just
5:57
Speaker 1: be aware of those kind of rules that are out
5:59
Speaker 1: there if you are participating in this. First of all,
6:02
Speaker 1: just let me know are you guys buying the SpaceX ipo.
6:05
Speaker 2: Just yes or no? Down in the comments. I'd love
6:07
Speaker 2: to see where the audience is going.
6:09
Speaker 1: X Stox though now launching the xdox alliance member big
6:13
Speaker 1: at Wallett now with their successful SpaceX x stox which
6:16
Speaker 1: is called spc x X all out there and available again.
6:21
Speaker 1: These are what I think is a frothy, frothy situation
6:25
Speaker 1: around SpaceX that, unfortunately, I feel is going to be
6:28
Speaker 1: a bad situation for retail, and that is a pump
6:31
Speaker 1: and then most likely a pretty significant dump. But we'll
6:34
Speaker 1: see how it plays out. Franklin Templeton is talking about
6:38
Speaker 1: how they're going to participate.
6:39
Speaker 2: Let's know what they had to say.
6:41
Speaker 3: So what happens if this goes If this IPO goes well,
6:44
Speaker 3: if it doesn't go well, the investment bankers do a
6:47
Speaker 3: great job at really managing the price and the demand,
6:52
Speaker 3: and so I'd be surprised if this didn't go off well.
6:56
Speaker 3: And we've been investing because we have both venture and
6:58
Speaker 3: we've been doing late stage now sure in our growth
7:00
Speaker 3: equity funds for over a decade, so we actually already
7:03
Speaker 3: have exposure and we will participate in the IPOs.
7:05
Speaker 2: And I'm hearing you know there's retail. Yeah, you can
7:08
Speaker 2: get in, you can get I don't believe it.
7:09
Speaker 1: I'm not sure what she's been looking at. But if
7:12
Speaker 1: you look at the past, biggest IPOs in the past,
7:15
Speaker 1: Airbnb dumping, Rivian dumping, coinbase dumping, I mean, snowflake dumping,
7:22
Speaker 1: Uber dumping, Figma. They're all dumping, So what would make
7:26
Speaker 1: you think that this one would be different in terms
7:29
Speaker 1: of them going out into the market, especially with the
7:32
Speaker 1: amount of fraud that this could go. Sure, we could
7:35
Speaker 1: see a little bit of a move, but that move
7:37
Speaker 1: most likely is going to compound the investments in these
7:41
Speaker 1: and people will take profits and they're going to get
7:44
Speaker 1: their funds back from their investments that they made in
7:47
Speaker 1: these early stages into the company and take their profits
7:50
Speaker 1: and billions away from the retail investor. All of that, though,
7:55
Speaker 1: is undershadowed by what we continue to still see as
7:58
Speaker 1: the biggest market presence in the entire market, and that
8:01
Speaker 1: is what's going on in Iran are As.
8:03
Speaker 2: Military is now.
8:05
Speaker 1: According to Trump, is a complete and total mess because
8:08
Speaker 1: they have been completely defeated. They don't want to talk,
8:12
Speaker 1: they don't want to deal.
8:13
Speaker 2: The bully of the Middle East is dead.
8:15
Speaker 1: This is the kind of stuff and the rhetoric that
8:17
Speaker 1: we continue to see coming out of Trump. I don't
8:19
Speaker 1: know this guy. Is anybody listening to Trump anymore? Because
8:24
Speaker 1: there's so many promises that have been broken here, so
8:27
Speaker 1: many promises that have been said, we got a deal,
8:29
Speaker 1: We don't got a deal.
8:30
Speaker 2: I think it was thirty plus times.
8:32
Speaker 1: I don't see how anybody has taken it serious, and
8:35
Speaker 1: being able to negotiate this out is going to be
8:36
Speaker 1: critical going into the midterms.
8:38
Speaker 2: I wonder what he has up his sleeve.
8:42
Speaker 1: If this continues to go sideways and we continue to
8:45
Speaker 1: see the problem of inflation, fuel prices and all of that, well,
8:49
Speaker 1: Arthur Hayes thinks he has an ankle on this.
8:51
Speaker 7: Take a look this oil and commodity inflation has been
8:55
Speaker 7: building through the supply chain for months. You can't just
8:57
Speaker 7: stop it, and so is baked in. There's not really
9:01
Speaker 7: much you can do about that situation. So I almost
9:04
Speaker 7: think you got a kitchen stick the affordability issue. So
9:07
Speaker 7: if you can't really do anything about that issue, what's
9:10
Speaker 7: the next thing that people care about? And I think
9:12
Speaker 7: that they probably care about this more because, yes, if
9:15
Speaker 7: a price of good goes up ten percent, but you
9:18
Speaker 7: have a job, Okay, it's bad, but you still have
9:21
Speaker 7: a job. If AI takes your job, you have no
9:24
Speaker 7: income and it shit's going up at price.
9:27
Speaker 1: So what are you afraid of more the AI taking
9:29
Speaker 1: a job or the inflation?
9:31
Speaker 7: You know, rich and poor, red and blue Americans are
9:35
Speaker 7: scared shitless about the eye.
9:37
Speaker 1: I don't know that Trump would pivot on using an
9:41
Speaker 1: anti AI approach, And I get that maybe Hayes is
9:45
Speaker 1: thinking that there's a lot of people that are concerned
9:47
Speaker 1: about I don't know that that is really the case.
9:49
Speaker 1: I think people are aware of it and are concerned
9:51
Speaker 1: about it, but I think they're more concerned about price
9:53
Speaker 1: at the gas pump. They're more concerned about price at
9:56
Speaker 1: the grocery store. Those are the kind of things that
9:58
Speaker 1: are going to be front and center coming mid terms.
10:01
Speaker 1: I don't think Trump is going to have any way
10:04
Speaker 1: that the midterms are going to get salvaged unless he
10:06
Speaker 1: gets an off ramp and gets out of Iran or
10:09
Speaker 1: at least gets the straight of Horn moves open.
10:12
Speaker 2: I don't know that we're going to see this.
10:13
Speaker 1: And remember there was also just a recent tweet from
10:16
Speaker 1: Trump saying that the US government is now going to
10:19
Speaker 1: take a stake, much like they did with Intel, into
10:22
Speaker 1: some of these AI companies. So why would he be
10:24
Speaker 1: anti AI if they're actually trying to build a stake
10:28
Speaker 1: in those companies. I just don't see that as being
10:31
Speaker 1: the case going forward. If you look at the rate
10:34
Speaker 1: hike situation, which is a concern I have right now.
10:37
Speaker 1: You've got a fifty two percent rate hike right now
10:40
Speaker 1: on December.
10:41
Speaker 2: If you look at the.
10:41
Speaker 1: October data, it's hovering in September around thirty two percent.
10:45
Speaker 1: Then you go to October at seventy. But December still
10:49
Speaker 1: likely a good large opportunity here for rate hike, and
10:53
Speaker 1: you can kind of see it right there, thirty nine
10:54
Speaker 1: percent holding right now as we even though we had
10:58
Speaker 1: spiked up to around fifty one percent on June eighth,
11:02
Speaker 1: just earlier this week. So this is the real question.
11:06
Speaker 1: Will Kevin Walsh put a rate hike in play? Because
11:09
Speaker 1: if he puts a rate hike and play, where would
11:13
Speaker 1: crypto be at that time, especially if we are not
11:16
Speaker 1: out of the Middle East and we continue to see
11:18
Speaker 1: inflation flaring like we are right now. I want to
11:22
Speaker 1: go to Cudmore real quick, Mark Cudmore, because he gets
11:24
Speaker 1: into the whole inflation situation as it is.
11:27
Speaker 2: Take a look.
11:28
Speaker 8: Friday's jobs print changed the game. I mean that was
11:31
Speaker 8: a very very strong print, and it really jobs is
11:34
Speaker 8: the one bit that people are nervous about that will
11:36
Speaker 8: kind of prevent the FED from being backed into hiking rates.
11:40
Speaker 8: So now with that CPI print coming on the back
11:43
Speaker 8: of that that Job's print. If we do get an
11:46
Speaker 8: upside surprise Stowe, which is very likely, there's real kind
11:49
Speaker 8: of sensitivity in this market.
11:52
Speaker 5: Now.
11:52
Speaker 8: It's interesting, as we've priced in such nervousness since Friday.
11:55
Speaker 8: I actually think there's there's probably two way surprise risk.
11:58
Speaker 2: Now.
11:58
Speaker 8: I'm not sure it's quite as a symmetric as I
12:00
Speaker 8: would have said maybe a few days ago, and on
12:03
Speaker 8: a radar at minarrative for the fat is either they're
12:05
Speaker 8: probably on hold or they hike multiple times, because I
12:08
Speaker 8: think by the time they get backed and forced him
12:10
Speaker 8: to doing a hike, that means they are knowledging they're
12:12
Speaker 8: behind the curve and they'll have to go multiple steps.
12:14
Speaker 8: So it's a little bit bind around the rights pot
12:16
Speaker 8: as well.
12:16
Speaker 1: All Right, So I hope you guys heard what he's saying.
12:19
Speaker 1: He's talking about hikes of multiple times, and what they're
12:22
Speaker 1: saying or what he's saying there is that they could
12:24
Speaker 1: be behind the curve on where this is heading, at
12:27
Speaker 1: least from an inflationary standpoint. Other issues that this could affect,
12:32
Speaker 1: of course, is the risk markets, because as we see
12:35
Speaker 1: rate hikes typically what we have seen in terms of crypto,
12:39
Speaker 1: is that causes crypto to go down.
12:41
Speaker 2: Pompleano talked about this today.
12:43
Speaker 6: And so if you go and you look, if there's
12:45
Speaker 6: not going to be interest rate cuts, obviously that can
12:47
Speaker 6: serve somewhat as a headwind. But I think that just
12:50
Speaker 6: because we don't get interest rate cuts doesn't mean that
12:52
Speaker 6: the government's national debt is not going up or that
12:54
Speaker 6: there's undisciplined fiscal policy. And so ultimately, what I believe
12:59
Speaker 6: is happening here is there maybe some short term headwinds
13:01
Speaker 6: because people aren't going to see rates go back down
13:03
Speaker 6: to zero percent as we saw over the last few years.
13:06
Speaker 6: But I do believe that people still are very long
13:08
Speaker 6: term convicted that the government cannot stop printing money. They
13:11
Speaker 6: can't stop printing money, They're going to debase the dollar.
13:14
Speaker 6: If the dollar gets debased, then you're going to want
13:15
Speaker 6: to own assets. Assets like bitcoin and gold are going
13:18
Speaker 6: to do very well over a long period of time.
13:20
Speaker 6: And so I think that an entire generation woke up
13:22
Speaker 6: to that fact during COVID. They now are convinced, and
13:25
Speaker 6: there's pretty much no data point you're going to show
13:27
Speaker 6: them that is going to convince them otherwise, I.
13:30
Speaker 1: Think that what Popiana is saying, you know, in general,
13:33
Speaker 1: is right, and the key words that he was talking
13:35
Speaker 1: about there is long term, okay, The issue is what
13:39
Speaker 1: happens to the markets in the near term, and the
13:42
Speaker 1: near term will be correlated heavily to rate hikes. If
13:45
Speaker 1: rate hikes do occur, you will see pain in the
13:48
Speaker 1: risk markets, and Bitcoin will probably be one of the
13:50
Speaker 1: big ones.
13:51
Speaker 2: That leads the way on them.
13:52
Speaker 1: Now. He talked about further in this same commentary, is
13:58
Speaker 1: is this the right bear market for you maybe to
14:00
Speaker 1: get into crypto for the first time, take a look.
14:03
Speaker 6: And so peaking in October and drawing down now, that
14:05
Speaker 6: would line up with that four year cycle. But one
14:07
Speaker 6: of the things that we have seen is that this
14:09
Speaker 6: is one of the best bear markets. And usually you
14:11
Speaker 6: don't want to celebrate when an asset is going down,
14:14
Speaker 6: but what we have seen is that we are starting
14:15
Speaker 6: to hit a number of metrics that historically have actually
14:18
Speaker 6: signaled we're near the bottom of a bear market. But
14:20
Speaker 6: it's doing it without the eighty percent drawn out. Now
14:23
Speaker 6: bitcoin is still down fifty plus percent, and so it
14:25
Speaker 6: doesn't feel good for the people who are holding bitcoin,
14:27
Speaker 6: But I do think that these bear markets are getting shallower,
14:30
Speaker 6: which also means that the volatility overall of the asset
14:32
Speaker 6: are dampening. And a lot of that is because you
14:35
Speaker 6: have the institutional participation, you know, if you go when
14:37
Speaker 6: you look at bitcoin itself. One of the things that
14:40
Speaker 6: I think people are starting to talk about. There's guy
14:42
Speaker 6: Benjamin Cohen who's come out and said the percent of
14:44
Speaker 6: bitcoin that is held that is underwater is now larger
14:48
Speaker 6: than the percent of bitcoin that is held that is
14:50
Speaker 6: in profit, and that usually is a pretty good signal
14:52
Speaker 6: that we are near the bottom of a bear market.
14:54
Speaker 6: And so I think that a lot of the bitcoiners
14:55
Speaker 6: are starting to say, Okay, you know it's drawn down enough,
14:58
Speaker 6: I'm going to start accumulating now.
15:00
Speaker 1: So I think that accumulation most likely is occurring and
15:04
Speaker 1: probably will continue to occur, especially around the sixty k
15:07
Speaker 1: and below. But the question marks right now are still
15:11
Speaker 1: centered around inflation. We're of course dealing with what could
15:15
Speaker 1: be the macro headwind of a century in terms of
15:18
Speaker 1: energy and what's going on in Iran. And then I
15:20
Speaker 1: think you've just got this whole issue that is really
15:23
Speaker 1: facing the crypto industry around clarity. So there's just so
15:26
Speaker 1: many things that pace this out. And lastly, if you
15:31
Speaker 1: consider how mostly institutions have been one of the big
15:35
Speaker 1: accredited components of really propping bitcoin up to its all
15:39
Speaker 1: time high of one hundred and twenty six K, if
15:41
Speaker 1: they're not participating and they're willing to stepway and wait
15:45
Speaker 1: for that volatility, especially a rate hike, I don't know.
15:48
Speaker 2: I think we could see a much lower market.
15:51
Speaker 1: Yes, that's a continued bear market, but it does open
15:54
Speaker 1: up an opportunity I think for a lot of these
15:56
Speaker 1: to get in position. And remember the S and P
15:59
Speaker 1: five hundred is getting ready to face one of its
16:01
Speaker 1: biggest headwinds yet with what's going on with SpaceX. So
16:04
Speaker 1: there's a lot going on in the market. We'll continue
16:06
Speaker 1: to cover it. If you like this video, hit like
16:14
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16:18
Speaker 1: our free private member group the links in the description