Proof That Bitcoin & AI Are Going MUCH Higher | Jordi Visser

(upbeat music) - What's up everyone? This is Anthony Pompiano. Many of you know me as Pomp. You're listening to the Pomp podcast, which is my effort to find the most interesting people in the world and sit with them for hours while I ask questions in an effort to learn. So it would mean the world to me if you would subscribe to the show on your favorite audio platform, watch episodes on YouTube, and tell your friends and family about the podcast. My goal is to help millions learn from the world's most interesting people. So let's get into today's episode. Anthony Pompiano runs Pomp Investments. All views of him and the guests on his podcast are surely their opinions and do not reflect the opinions of Pomp Investments. You should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only. - I think for Bitcoin, the fact that so many people have gotten, let's say, tired of it is a great sign. And I believe the next top will happen with two things that have happened both times. Number one, Bitcoin needs to massively outperform the Mag7. That has happened at both of the prior peaks, both at the four-year cycle and literally just massive moves. And the second thing is... - What's going on, guys? We got a great episode today with Jordy Visser. In this conversation, we talk about what's going on with Tesla, the RoboTaxi's Bitcoin, gold, the US-China trade deal, tariffs, inflation, interest rates, and your portfolio. Jordy is in rare form. He breaks it all down for us. I learned a ton from this conversation and I think you will as well. Here's my latest conversation with Jordy Visser. - All right, Jordy. I thought a great place to start today's conversation is there's a ton of stuff going on all across the financial industry, but actually there was a development with Tesla and the RoboTaxi's that you think is gonna have this profound impact on Bitcoin, on AI, on energy. What is going on with Tesla and these RoboTaxi's? - Well, first of all, I think it's really important to let the audience know. I've seen you three days in a row now. - We're hanging. We're hanging. - We're hanging. - We're hanging dinners. - Every dinners. (laughing) - And then today. - All right, and so at the dinner we were at last night, the way that my brain likes to kind of deal with the modern world, which to me is the most interesting time I've ever had. So I'm a macro person who tries to think of the end game, think where it's gonna be, and then connect all of the different pieces to that. So more of a systems perspective and I believe in abundance. So I believe in, whether it's 15 years, 20 years, the world that Elon Musk has talked about is something I believe in. And so over the course of the time that we've been spending together and over the course of the last really two years of using AI all day long, my belief in this continues to grow. And so when I do my weekly YouTube, it's meant to connect the traditional finance world to the AI world to crypto because that's the end game. Abundance involves Bitcoin. And so the gateway to that, the chat GPT moment is when we leave stage one of AI, which we are doing. We are leaving the autocomplete text part, the really boring part of artificial intelligence where it's really good at predicting the next word. And technically easy to do. And technically easy. And especially if you put more compute, but we're also getting garbage thrown into it now. So I listen to that and then I hear all the bubble stuff. And I love a market where I have a view and everyone that owns money, the people that have the wealth, they believe there's a bubble. They like talking about gold, which I'm sure we're gonna get into 'cause I have very strong feelings about that in this whole context. But in listening last night, I can't listen to macro people talk about debt deficits. You probably saw me at some point lose interest a little bit, just because if you don't have a view on how AI connects us to crypto and you're locked in this world, this ancient world where people will say, "Niall Ferguson said that interest expense," have you heard this one? When interest expense crosses defense. You know what I've never said on this show or to anyone who'll listen? Here's a new data point for everyone. Do you know that all those times in history, you know what there wasn't? Entitlements. So we're talking about nominal dollars comparing two things. In a world of AI where maybe people will live forever, that doesn't mean anything. So you can't take historical wars, historical relationships, and then put them in the context of a world of AI. So Tesla comes out and reports earnings. And as usual, everyone goes up. Here we go. This is the big number. And you have 90% of the people that hate Tesla. And then you have 10% that are cultish. And there's really nobody in between. And I can say that as someone who speaks to both groups. And it's very polarizing. It's like anything else. So I only cared about one thing. It's not a car company. The cars are data centers. They're collecting data. So the reason I bring up stage one of AI, when you leave that LLM world and for everyone listening, you're at some point gonna enter a world where embodied AI, intelligence with inside a machine, is going to be there. And that just means we're getting closer to abundance 'cause you don't have abundance with replacing knowledge workers. You have to actually replace everyone to get to abundance. And we won't go through the whole thing in abundance today, but it gets rid of that whole debt deficit thing too. And that's why I like when I listen to these conversations, it doesn't matter. So in the report or in the earnings release, they basically said we're gonna have driverless robotexies in Austin this year. And Polymarket, which has proven to be a really good thing to pay attention to, especially right now for Bitcoin people, it has two things. Number one, it has this now at 99% before the end of the year. So this is, Elon Musk has not trusted in any timeframe he gives. And yet the betting market said this is 99%. Somebody knows something. Somebody knows something. This is going to happen. This week, Dwarkesh Patel had an interview release about a week ago when we were doing last week's episode. I got so many things over the weekend about how Carpathy, Andre Carpathy said AGI is way down the road. The ironic thing is he is the architect or one of the engineer architects of the Tesla approach to robotexies. On that, the reason he said AGI would be out longer is because, and I agree with him, to have true AGI, which to me means true abundance, where robots can do everything a human can do. They need to perceive the world, the physical world, and they need to be interacting it. I've said this before, robotexies are just humanoids on wheels. It is the first step, and it is the same brain that will go into Optimus. So with that percentage being up there, when they release it, and people start to realize that the cost will be 60% lower than an Uber, because we don't have a person in it, and the cost of the cameras is cheaper than LiDAR. So that puts pressure on Uber's business, but you know what else it does? Every city in this country has an inflation problem. They have a living expense problem. Even though this is in Texas, and people go, the regulations will never allow it to happen in New York. You know what will want it in New York? The people that want to have cheaper rides. And this is the way FOMO will happen with abundance is even if the regulators are against it. And I mentioned this last night at the dinner. The voters want deflation. The voters want cheaper things. And so the earnings report for Tesla was not about the car stuff. It's about, in my opinion, the chat GPT moment for embodied intelligence. - So on New York in particular, I think it cost is probably the biggest input by far, like far away. The second thing though is it's safer, both in terms of driver safety. It's also safer for the riders. How many times do you hear a story about some crazy situation happens? There's an argument between the driver, rider. All that stuff gets resolved. The third thing is that the car actually follows the rules that the city sets, right? So you just go through all these things. It is better. Now there will be jobs that get displaced, but that has happened throughout society. Now you say that this is the chat GPT moment for embodied AI. One of the things that I found most interesting is you can now go to the app store and you can download the driverless RoboTaxi app and sign up for the waitlist. I would love to see, give it a week or so. How many people went and did that? 'Cause it's not available, right? And it's not getting inserted into an Uber or a Lyft. So it's kind of in the same interface. They essentially are going to ask people to change behavior and switch from Uber or Lyft to a driverless RoboTaxi app, which is an entirely new experience. You got to set up a whole profile. You got to attach your credit card. They're not going to play the like, oh, let's go partner. They're going to go and compete head on. And the only way somebody does that is if it really is materially cheaper, it's a better service, et cetera. You cannot get people to switch like that if it's just a Me Too product that is comparable in price, et cetera. It's why Uber has had such a big advantage over Lyft for so long and Lyft could never steal the market share. Here, they're coming to market with a different product that we think is going to be better. But to me, that's going to be the thing. If you can get people to leave Uber and go over to Tesla, this is going to be exponentially bigger than everything. - So for everyone who lives in the New York area, everyone knows how much the cost of an Uber and a taxi went up from 2019 to now. Forget how much rents went up and everything else. You know exactly how much it went up and it was a shock value. I left you at the dinner last night. I took an Uber back to Brooklyn. It's an expensive ride to go across the river. And we were right at the Midtown Tunnel. So it shouldn't have taken any time for me to get over at any cost. The reality is for people who don't understand how big this is, what would happen with RoboTaxi is it would reset that all the way back to 2019 levels immediately. And so for everyone who's like thinking about, oh inflation, I heard this all day yesterday with the macro world. Another thing that I'm like, I've had enough of. Oh, all the inflation. - The government says it's 3%. - Yeah. And again, inflation says 2.8. - Whether it's 3, 3.3, 2.8. Everyone was wrong on inflation from tariffs. Everyone was wrong on growth from tariffs. Everyone. It is insane to still be doing this stuff. - I told y'all, I told you. I told you. - You did, you did. You got that one, you got that one right. - Nine months, go ahead. - It is slightly higher so people can have the thing. But the reason this gets important is if you start rolling stuff back and you start bringing out embodied intelligence, starting with this, it's gonna be rolled out to trucks. All of a sudden the shipping costs are gonna start to come down. It is very difficult to then look and go, how long will it take for optimists? Well, there's a shareholder meeting for Tesla coming up on November 6th and on the front page is an optimist. He also said in there, we will be unveiling optimists in Q1 of next year. All that really matters is the RoboTaxi brain is the optimist brain. And that's what people have to understand. This whole thing with Waymo, I was talking to someone about this this week and they're like, well, what's the difference between the two? I'm like, can you spot a Waymo on the road with the gigantic thing on top that looks like an archaic piece of equipment? A Tesla RoboTaxi, you can't tell. It's just, you can't tell it's a driver listing. If they had tinted windows, you wouldn't be able to see anything. So if people want to go mess around with the Waymo, it's very easy, you pick it out, you go mess with it. You want to go mess with it. There's so many reasons why this is so important. And I made the statement and I don't want this to go because if people are sitting on their seat, what does Jordi mean? This is important for Bitcoin. The concept of abundance, whether or not you believe in it. I've said that I've gone forward. The reason I got so interested in Bitcoin is because I believe that AI would disrupt everything and eventually cannibalize capitalism. That's what I believe. Now, it's not a negative thing in the end. It's a very positive thing. In fact, what Elon Musk says is, we're not going to have universal basic income. We're going to have universal high income. And the reason is because the employees that are making the money, they don't spend money. So that money gets redistributed in a way. So the profits actually become profit sharing as opposed to wages. And that becomes something that's very easy for governments to distribute. Whether or not companies have it or whatever, the robots have it. And so whether or not you believe in that, the robotaxi getting there ends the concept of scarcity. And with no scarcity, you have to go to the place where there is scarcity. So leverage goes down in abundance. Time collapses. Those are all the things that the entire fiat system is based on. It's not just based on trust. It's not just based on scarcity. And it's based on time. And all of that is what Bitcoin compresses. So I will say it again and again. I believe this moment where labor really starts to feel the pressure and the foundation of society shakes because people are worried about jobs and they're voting in people to get them there. I do believe that the crypto market is going to be a major, major beneficiary of reducing and being the deflationary force in the financial side and everything else as transactions speed up. - Today's episode is brought to you by Figure. They're the largest non-bank mortgage lender in the United States with over $15 billion unlocked on their lending platform. They've just lowered rates on their Bitcoin and Ethereum backed loans to 8.91%. Improving their already industry low fixed rate, 50% LTV loans. They keep building as well, being the only major CBL player to launch decentralized MPC custody to protect against single entry failure. And they just removed interest deferral fees entirely so you can let Bitcoin price appreciation pay for your loan over time. What is MPC decentralized custody? It's a Bitcoin or ETH on chain wallet with multiple key shards to protect you from single entity custody failure. 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Take advantage of wild moves and assets like Solana, Sui and Doge and use them to stack more Bitcoin completely hands-free. ArchPublic is already a preferred partner with Coinbase, Kraken, Gemini and Robinhood and their team is here to help you build smarter in any market. Visit ArchPublic today at archpublic.com and your portfolio will thank you. Let me give you a different way of talking about this and I want your reaction from it. So when people hear artificial intelligence, it reminds me a lot of when people first heard Bitcoin. Last night at dinner, we literally at one point had to stop talking about Bitcoin and put it to the side because people could not get over the word Bitcoin. It was so polarizing. And so we had to talk about what we were talking about and basically like not use the word and all of a sudden people could like have a much more rational conversation. But I remember Andrew Ross Sorkin of all people told me, this is probably like four or five years ago. He said, "Bitcoin is the one asset where I can bring 10 of the smartest fund managers that I know in a room. Say, what do you think about Bitcoin? Believe, come back in an hour, five will be on the pro side, five will be on the con side, and they will think the other side are complete idiots because of what they believe." So AI is now entering into this around bubble and is the technology actually gonna do what it's perceived to do, all that kind of stuff. If you flip it around though, instead of talking about the technology and what is being built, if we instead called this the efficiency era, and we just said, "Technologists are now assaulting inefficiencies across the economy, across business, and across your individual life, I actually don't think it's as controversial." Now all of a sudden people are like, I want efficiency. I wanna get more, pay less. I want companies to be more productive and spend less, right? I want the efficiency. And so it almost feels like because we are also focused on the technology and the companies and like the inputs to this, that's what we talk about. But actually the thing that is not controversial is the outcome, which is we are going to go through a rapid increase in efficiency across all aspects of the economy. And that efficiency will actually create this abundance and create this kind of productivity that will have a profound impact, both on the micro like individual level, but also on the macro economic level to a point where in hindsight people look back and be like, that was one of the greatest moments in our lifetime. - Yeah, so you hit on two things there that I just wanna make sure that, so the great thing about our relationship is you've been involved with Bitcoin for a long time. And if you had gone back six years ago to 2019 and someone had asked me, what's your view on Bitcoin? I'm like, it's a trading vehicle. Like I don't, the blockchain itself, I get. I had not been able to place the concept of Bitcoin into something that made sense. But at the time it wasn't a big enough asset either for me to even really kind of think about. And things that move parabolically and then end parabolically, they don't really interest me that much, which is ironic 'cause that's what gold is doing right now, being fueled by retail and a whole bunch of things, but I'm sure we'll get into that. And Bitcoin's fall has collapsed and everyone's worried about the four-year cycle and all these magical things. Last week I said the four-year cycle is like an overlay with the MDX. So if you're bearish on stocks, you should be expecting the four-year cycle. One more thing for the four-year cyclists, is that what they're called? Now they are four-year cyclists. You know what happened before 2017? Fed was raising rates. You know what happened before the last thing? The Fed said they were gonna go on a major, they pivoted and that was the peak. They're cutting rates this time. I don't know if you heard the rumor, they're cutting it. So this efficiency thing and this Bitcoin thing, the part that makes it polarizing to me is kind of where I go, I think it's a generational thing. So one of the reasons that I was interested in us sitting down doing this is 'cause I'm much older than you. - You don't look it. - That's a different story. We'll talk about that someday. All those injections are working great. (laughing) What's really important in this whole thing is that having a generational gap is important because the older you are, the less likely you are to embrace Bitcoin. - True. - And that's just a fact. - I love the boomers in the comments though. There were always some of them say, I'm and they'll put their age and say, but I've been into Bitcoin for so long as like a point of pride. I respect all of you, but go ahead. (laughing) - When you get to something that the older you are, the less you believe in something, think about what's happened to religion in the world. And it's like the reverse scenario. Younger people don't embrace religion as much as older people do. I just think people have not paid enough attention to what the younger people's complaints are about the world that they live in. And that the people that are older, that already have made money, they had a job. Even if they don't have a lot of money, the one thing they had was a job. And in a lot of cases, even if they were middle class, they had a job for 30 years at the same company. Young people don't even have that. And so to think about the fact that they have this perma inflation, not high inflation to where we get a recession and you get to reset it, which is what all the boomers went through. Oh, recession, I always say recession is a good thing. Then you get a reset. They don't get that. They just get this perma, it never gets better. At the same time they have AI and they have social media, which means they can drown in all the negativity and go through all this. I just think this generational gap in the belief of efficiency is good. Efficiency leads to deflation. And that's why everyone who's older keeps talking about inflation, about wars, about stock market going down, about politics. They're talking about a lot of things that I think in the case of younger people, or even people that are in that position, low, younger than 40. I just, I know they have pain 'cause I have three kids in the 20s and 30s, so. Well, I do think that-- I'm sorry, so my kids don't get mad at me. I have four kids, three of them in the 20s, one of them in the 30s. There you go, there you go. If you think about some of the people that we've talked to this week, and this belief that inflation, capital controls, war, et cetera, we were talking with one gentleman, and he kept talking about this idea of there are these big macro issues at nation state levels. They are going to have to create capital controls in a variety of different ways. And his basic conclusion on a Bitcoin was they're just gonna outlaw it, and therefore people will not be able to use it, okay? Then he, the AI thing is he recognizes AI is there and is going to continue to become pervasive, but probably doesn't believe in the profound impact and kind of the more abundance type outcome. And I think what was interesting is one of these dinners we were sitting at, there was, I don't know, 10 people, maybe 12 people, whatever it was. And there was a pretty wide range of folks. There were some folks who were later in their career, there were some folks who weren't early. I don't think there was anything like 25 year olds, I think it was probably like 30 to maybe 60, it was kind of the range. And the younger people in the room were pretty dismissive of the old world view. And immediately we're like, if the government takes a kind of heavy handed approach, there is a release valve, there is an escape. And it was fascinating how much the older folks were just like, the government always wins. And the younger folks were like, the government can't control the internet, right? And even one person brought up the fact of like, dude, just look, the government officials say stuff on the internet and they're just getting slammed in the comments and meme, they're shutting off comments, they're deleting their tweets, like there is this difference of, do you believe that government has ultimate control or do you believe technology now is the predictor of success? And I think that to your point, it applies to AI, to Bitcoin, to all these things we're talking about, right? - Yeah, actually, you clicked on something for me. So before the dinner yesterday, I had an event to present to. And there were about 40, 50 people there. And these are all very sophisticated financial people that are in the industry. And I gave a presentation on artificial intelligence 'cause the theme was- - Shocker. - AI, yes, that's true. So one of the things, I had to, one of the goals that the person who organized it gave to me was, we really want you to help inspire the board members that are here to embrace AI because we've been kind of slow moving. Now, adoption's been slow for a lot of places, but the message that I presented, which is very similar to what you just said about the view of government, is there are three layers in most organizations due to the hierarchical structure that's existed for a long time. You have leadership, you have the technology layer, which has grown in importance over the course of the last 30 years because of the internet, because of cloud, because of everything. And then underneath that, you have the younger employees. And what has happened with artificial intelligence is very similar to what you're saying about Bitcoin and about governments and the way younger people view this control thing. Leadership at every organization fears losing control, just like a government. The technology layer is the layer that is the party pooper in this. And they go, no, no, no, you can't use AI. The data could be stolen, everything could go on. So their job is they're fighting to not be irrelevant because AI coding replaces them in many, many ways. So they don't embrace it. And the employees put pressure on both groups 'cause they're like, hey, my friends are using it down the street. How come I'm not a part of this? That is a microcosm of what's happening in the world. And AI is connected to that with Bitcoin. There, everything that you mentioned is exactly the way I see it. And it's funny because we go out to a dinner the night before. I'm just talking about our dinner the whole time. I chose all the people at that dinner. You did. And the range of ages was still about the same as last night. The difference was at the dinner I put together, it was all people that embrace. Optimus. Yeah. 100% optimal. And embrace crypto as part. And you're talking about, I mean, one of them had been a CEO at two major companies. Embraces crypto. You don't find many of those people. The reason I like to have conversations like that is because we can talk about the China US situation. We can talk about Bitcoin. We can talk about tokenization. You can't have that conversation in the dinner last night. And I had to shut down, and I'm very hard to shut down unless I run into a stubborn conversation where it's like, I'm over here, you're over here, nowhere where we meet. All you wanna do is be open to the concept of abundance and how it could play out differently because a probability distribution curve has all of the outcomes that are possible. For people with Bitcoin, it's not even part of the distribution. It's a bubble just like AI. Well, good luck to those people. I hope their portfolios aren't crying later. Let's talk about a couple of current events. Let's start first with gold. Gold seems to have been on this parabolic run. It's supposed to be a stable asset. Has not been stable to the upside, which is good for gold holders. But then there seems to have been a transition, a shift, a regime change, and it fell 8% in 48 hours. I did not see a single headline saying that gold is a bad store of value 'cause it fell 8% in 48 hours, but if it had been Bitcoin, they would have wrote that. What's your read, is the bull market over or the gold bug's gonna go back to irrelevance for a decade? Love you guys. - So last week, at least the timing on saying that I'd be very scared if I was long gold with the China-US thing coming up. - Nailed it. - Because I think if there's an agreement, the risk could be fairly big. And that's because the most recent rally, which occurred during the summer, from the summertime. So from August to now, gold went up like 1,000 points. After a range that traded. For all the Bitcoin people, remember, gold was in a big range. Then it broke out and it got lunar very, very quickly. Here's my take on gold. And since we really haven't talked about it. So in 2007, myself and some other people at the fund that I was at. We had a gold dealer that came into the office regularly. - Like a physical gold dealer. - Physical gold dealer. Because I thought the entire banking system was going to go under. And most of that came from my time at Morgan Stanley, but most of that came from before the printing press. Everything changed after I saw what they did with TARP. That changed my entire mindset and believed that at that point, we were entering a different kind of world. But during that time, I bought gold continuously. And what I said last week is, even during the period of 2010 coming out of the crisis to like 2016, gold did nothing. So I said, gold can go long stretches of doing nothing. And the reason it can do nothing is just like Bitcoin, there is no story to it that is a value story. It's just a, people are buying it. So the debasement trade is not a new trade. But when the banks start talking about it, doing research on it. But most importantly, when retail inflows hit record highs, which is what happened last week, retails involved because they're attracted to volatility. And as long as they can make money in something, they'll get on anything. And gold does have a limited amount of kind of supply. And you very seldom in life are you gonna see macro people that are all bragging about it. And retail people that are all bragging about it, while the macro people are saying that retail is in a bubble. And yet they're all participating in gold. So I found this to be kind of unique. So my viewpoint on this is very simple. I believe the China-US thing is the single most important thing for the rest of the year. The Fed rate cuts are gonna happen. If China and the US come to a trade deal, and I want you to think about last night and the historian that was at the table, he and I had a conversation before. At the presentation I was at, there was a specialist on war that had predicted the last two wars, meaning he predicted the invasion, Russian invasion of Ukraine, and he predict the Iran-Israel situation. And I won't give up what his background is, but he's a very smart guy. And he was in the technology and cyber side, and he gave a really good presentation. What he said was similar to what the historian said, which is the US and China are headed to something right now. And the reason I think this is important is because even in my mind, if I was doing the probabilities of when China should invade Taiwan, US munitions are down significantly. They control rare earth and they just put a ban on it. So we don't have munitions at all right now. And to rebuild them is gonna take some time, and we need rare earth to do that. At the same time, this trade war is kind of the reason for them to do anything. So if they can go in there and do something, now would make a lot of sense. And so in the discussion we had was if you believe in the macro version of capital flows and the anger towards all these countries, and that it's a de-globalizing world and blah, blah, blah, and all this stuff, if there was gonna be a war, I do agree that in the near term, it should be the case. But there's one other element I wanna bring into this, which I said to both of them. The determinant of quantum and the determinant of AGI, I just don't think if you're gonna do a war, you don't wanna wait until after we reach these like mythical things of the ability of, like I said, I mean, unless I'm missing something on quantum, if people are worried about breaking Bitcoin, wouldn't you be worried that you could break into nuclear arms and shoot them at, have the country shoot them at themselves? Like I think if you get to quantum, everything kind of changes. And I think that would be a great deterrent for doing something. So I'm leaning towards the fact that the macro people that are still happy with the returns this year, despite being wrong on the stock market, despite being wrong on bonds. So they wanna be sure of both of them, and that hasn't worked, dollar hasn't weakened. So all of the macro trades that were beloved, anti-US exceptionalism, all of that, they're not working anymore. The one that has saved them this year is gold. And so what I'd really be worried about if I was running a portfolio where my only trade that was working was gold, and I have retail buddied up next to me in the speculative side, and I have this China-US thing. I think if there's a China-US trade deal, I think gold will continue to go down, and then we'll just take it from there. I think it has had an excessive outsized return. And I also think that would be a positive for Bitcoin. - I'm gonna give you a couple of data points. So on polymarket right now, the odds that China is actually hit with 100% tariffs in November, 9%, was over 40% earlier in October. The odds that China ends up signing a deal with the United States before the end of the year is like over 50%. The odds that the tariff rate is between 25 and 40% is like 70%. So basically what the market is telling us is they're not gonna get hit with 100% tariffs. A trade deal is gonna get done this year. And the final resting tariff rate will be somewhere between 25 to 40%, which is much lower than the 100% that's being threatened. If that happens, which the market is saying, for the prediction market, that's gonna happen. I mean, do we just go vertical up like a SpaceX rocket in terms of stocks Bitcoin and gold goes down because there are like rotations on? - So here's the way I'm thinking about it. When Trump won last year, we had an immediate reaction in the market. And the things you described were the immediate reaction. So small caps ripped, you had a whole bunch of things that are like, oh, this is gonna be good for the manufacturing, it's gonna be all this. But then he does tariffs. And beginning in January into March, the market starts repositioning for this world. The only thing that has saved the market this year has been the AI trade. And the AI trade is based on earnings. So the part that was based on the broadening out of the economy has not occurred. The PMIs are still below 50. So to your point, I do think you have to go reset back to the way you were thinking about the markets in November of last year after the election. And I think those trades are actually going to work now. And this is kind of like the reverse of what happened in his first presidency. Because in 2017, the stock market ripped, Bitcoin ripped, and then it peaked. But that year was the tax cut years. The next year was the tariff years. This year we got the tariff year first. The question is with all the cuts in rates that have gone on around the globe, not just in the US, with the cuts that have come, but also something I've shown to a bunch of transportation people. The economy has had a problem because China is critical to the country from a trade basis. Everyone knows that, like if you need windows, if you need anything, to get that from any place else in the world is very difficult. Chinese exports to the US are down 27% year over year. If all of a sudden they buy soybeans and they come up with a new trade agreement, then I would, if I was gonna pick any of those poly market things, and I think a trade deal by November 10th is actually at 70 something percent. So by the end of the year, it's gotta be much higher than that, but even by November 10th it's still high. If I was gonna pick one of those that I would bet against, it's actually the tariff one. I think that, I think where the Chinese hold cards and what they're trying to get to, the win for them is that the tariffs actually are not there, that they're like every other country in the world. So I get a 10% blanket. - Yeah, like, and that's, I think they just wanna be treated fairly. And my guess is, is that if I was gonna pick one and be lowered, that would even make it more bullish. And the interesting part about the guy who spoke last night, or spoke yesterday at the event, he said, what's really interesting about this situation is that there are so many China hawks in the administration. And the most dovish person is the president. And that's the interesting thing in, if Donald Trump wants to make a deal, he's going to make a deal. - Of course. - And I think we're at that point where, if he wants a big deal, maybe it doesn't happen October 10th, maybe the market falls again, that's why I still believe until you get it. And your question was a good one. I would wait in most cases until after the event. If I was gonna do anything before, I'd be buying call options, 'cause I do think it's an asymmetric risk to the upside if they do this. If there's a delay, it'll fall again like it did two weeks ago. And then he'll come out and say, we're going to get a deal done and we just haven't come to an agreement yet. So I think it's asymmetric to the upside in terms of if it comes out, I do think we're going to get a big move. - Today's episode is brought to you by DeFi Development Corp. Global wealth today exceeds $500 trillion, yet crypto still represents less than 1% of that total. DeFi Development Corp, Nasdaq ticker DFDV, offers investors a new way to gain exposure to one of the most disruptive technologies of our time, crypto infrastructure. As crypto intrad five veterans, the DFDV team is building the first Solana-focused public treasury. They're accumulating soul to give shareholders direct exposure to what they believe is the definitive crypto infrastructure poised to capture a significant share of the $2.4 trillion in revenue generated from global value transfer each year. 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But the 600,000 people that are basically saying robotics and automation are gonna get rid of these jobs. I think people kind of forget Amazon is a public company they have to keep growing. So what they're telling you is that revenue and profits are gonna keep growing, but they're gonna do it with 600,000 less employees, which they have somewhere around 1.5, 1.7 million people depending on the day and how you count. It's like a third of their workforce. They're basically saying they're gonna get rid of, but they're gonna keep growing, which would be a massive boom to profits. - Well, let's keep one. I think the way it read was they're not gonna hire people that they'd have to hire, but it is a replacement thing in some form. It's a semantics thing, but I reposted something which fits into this, and I wanna continue on the labor theme, which gets into the abundance and kind of this whole societal thing, which is I reposted something on X today, which had an overlay, basically showing that the job opportunities, the hiring, the jolts number for job openings relative to the S&P 500 has completely broken down. And it's alligator jaws, it's the K-shaped economy, but it's really meant to say that this thing that people are missing, which I brought up, and I don't know if you had already left the dinner last night, but I brought up this fact that people should just be aware of. Since the iPhone came out, we've had a major drop in the labor participation rate. And when the labor force participation rate drops, well, that suppresses the unemployment rate. People are not looking for jobs, so it's taking off supply of people. Now, everyone can go through the reasons why, but one of the major reasons why is the wealth effect. People don't need to work as much because the stock market's gone higher. And a lot of that has to do with the profit margins and the profit margins are coming because of AI. So when people try to figure out how the economy is doing, well, how much is AI? It's such a ridiculous goal that they have because if the stock market goes down, well, then GDP goes down. If profit margins go higher and the stock market goes up because of earnings and profit margins, well, then that's an AI impact. And so what you're describing to me for Amazon and all of these companies, we're entering the agentic world and the replacement of actual labor, whether it's through, we're not hiring as much, which is what we're seeing so far. I actually think we're gonna get into the replacement side because capitalism is based on driving shareholder wealth for public companies. Everyone who runs a public company, you too. You've got shareholders that want you to drive profits and the profit equation has revenues versus expenses. And so if you can do it with less people, then the shareholder value or the shareholders want you to do that. So I think the pressure that Amazon is showing, Walmart has publicly said this, and I mentioned this, Accenture has also publicly said it. If you guys just type in Accenture, Walmart and Amazon, what have they said about jobs? Those are three of the four biggest private employers in the country, they're all saying the same thing. So this wealth effect you're talking about, I have a Amazon related wealth effect, which prime example of both the insanity in society, but also how this works, which is McKenzie Bezos has given away, like I think the latest number I saw was like seven, nine billion, some crazy number. Given away, she took it and gave it away to other people. She has more money now than when she got divorced. Even though she's given away, you know, whatever the number is, seven or $9 billion. So that is like the ultimate wealth effect is you're not even spending it and consuming it, you're just giving it away to crazy causes, but you're giving it away and you still have more money than you did when you started the entire philanthropic effort. Nobody is spending money like she's giving it away. Right, so that is ultimately what you're talking about here. It's like, no matter how much money they are spending, the people who have assets, they are still net up because of that wealth effect. Since the end of 2019, and I didn't look at the numbers in the last month, so I might be off a little bit. I think the household net worth was around $110 trillion, okay? Net worth, not assets, net worth. That was in the end of 2019. I know now it's up near $180 trillion. So you've increased over the course of the last five years, $70 trillion. Now that is through, yeah, that'll be towards the end of the year. Some of that came in housing, some of that came in stocks. Regardless, to go up by $70 trillion means that is of the economy size today. Forget where it was in 2019. You've had such a massive move and that's why when everyone kind of looks at this, when Bitcoin goes sideways, the great thing is everyone's depressed on it. It's still up 20% here to date. It's still going on. So you've had fiat assets in the US. The pie go up to net worth of $180 trillion. So the wealth effect is real. It's why when people said savings are being drained, and I'm like, well, wait a second. If the wealth effect created, we're up to $180 trillion. And we're saying that the top 40% are responsible for basically all of consumption. And they all own stocks. Why are you worried about the other 60, other than the K-shaped economy and the anger that they're having, which again gets back into the need for abundance and the need for artificial intelligence? - Started from the bottom. Now we're here. Last thing I want to talk about, we have alpha. We got some alpha for you guys. You've had a couple of conversations. You shared them with me. Mike Novogratz started the talk on some podcast. Maybe the recent Bitcoin price isn't going up 'cause there's a lot of people selling. What are you hearing with your ear to the ground as to who could be selling and how much they're selling right now? - This is one of the more interesting parts of kind of entering the crypto world is bringing the skills that I had in the traditional finance world, the way I was trained. And I was a trader for the first 13 years of my life. And once you're a trader and you're born as a trader, you're watching every tick, you're talking to people, you want to know the flows and you're trying to figure out when a consolidation turns to a breakout, whether it's a breakdown or a breakout. When vol compresses and you start going in, by definition, that means there's a lot of supply and there's a lot of demand. So on both sides, you've got why, for bearish people like, wow, this thing, and we heard some of it last night. Well, this hasn't gone up yet. You've had all the treasury companies buying, you've had MicroStrategy buying, you had all that. So people are saying, MicroStrategy is going to blow up. I know it's going to happen soon. I've seen that posted in X by people that are traditional finance people. At the same time, on the other side, you have what Novogratz said in public on an interview, but also released it in the earnings for Galaxy. So this is complete public information on every channel, where he said, in September alone, we sold 9 billion for one client. Now, before I came over here, I sent you something, and I forget the on the desk chain or chain on the desk. I don't even know which one it is, but I sent you something. Would you like me to read the numbers? Sure. Galaxy reported earnings and said they sold $9 billion of Bitcoin. Nova talked about this on the Raul, Paul, and specifically mentioned Asian sellers, the Asians are selling. They get as worthwhile to talk about OG whale sellers and how important they are to this market, and also how volatile has collapsed rather than run like prior high four-year cycle tops. It feels like a transfer of ownership for the big move higher. Yeah, and what he did say to make sure I quote him properly, he said there's continuous Asian vol selling, so selling call options, and again, compressing it. So vol has gone lower, and the sellers that he talked about are selling because they're rich, they're rich, and they want some money, but there's another angle on this that I think I've heard from people that I believe in, which is if Bitcoin has moved to a vol that's lower, and if you believe that it's current size, which is now two trillion, and I've heard this, and you may have heard it too, it'll never move like it used to in the past, because it's just too big now, and it takes so much to move it that there's obviously been a lot of buying, but it's just churning and vols going lower, so it's kind of like a dead asset. If it's a dead asset, and let's use China, for an example, as an Asian country, a lot of Chinese individuals bought it there, partly to hide it from the government, back when corruption and things were going on, but China has a bull market, and the bull market's in AI, and I can tell you, with inside the AI world, if I mentioned Micron, well, Micron's tripled since April. That's a big company. You've had other companies like Nvidia, like the AI trade, you can make a lot of money, but also there's a startup world where these businesses are going parabolic. What these guys said was, the people who made a lot of money there, now they're looking to make it in other places, and they've got other choices that are gonna move faster, so it's a combination of Bitcoin's old, it's kind of big now, it's not worthwhile, and this is going higher, and the other thing is, people have to remember, the ecosystem has really been hurt this year. Most coins are down, so aside from Bitcoin, and I think Ethereum is up a little bit, you're dealing with an ecosystem where most of the coins are still down for the year, so it has not been a good trade because there's been other things to be involved in. Gold is much bigger, and I remind people, gold was up over 60% at one point this year? Well, that's over $20 trillion, so assets can still move, and that's why I believe what will end up happening is the OG selling that's been happening that has been distributed to many, many buyers. Those many, many buyers are just building a position. The people that are selling, they made a lot of money in it from back when you probably got in, or when you started doing your show. I was late, I was late. You were late. Okay, so they got in at really good times. I just think this turnover is very healthy for the market, and I will say what I said last week, if we break through the highs at any point, the next time we get through the highs, I think for certain we are gonna break higher. Now, I've been wrong on it all year in terms of where I thought it would be at this point. I heard Tom Lee's interview. I just wanna say one thing before we get off about Tom Lee and Dan Ives, who are both now involved in the crypto space as of this year. Two guys that have been dead right. Two guys that wear clothes and kind of bring this hatred that they wanna get. They're kind of like Tesla people at this point for the macro crowd. Like they view them as being bubble symbols, just like sailor. It's actually fascinating to realize that we've got all these figures that have been right on AI, been right on the stock market all year. But they're the ones that are a little off. They're the ones that are now Ponzi scheming things. When you listen to Tom Lee talk on your interview, everything he said was very deep. He got into a lot of intelligent things. I think for Bitcoin, the fact that so many people have gotten, let's say tired of it, is a great sign. And I believe the next top will happen with two things that have happened both times. Number one, Bitcoin needs to massively outperform the Mag7. That has happened at both of the prior peaks, both at the four year cycle. And literally just massive moves. And the second thing is, it needs to happen with volatility being much higher than it is. I do not believe tops and things like Bitcoin happened with the vol being at five year lows. I believe they at least need to be close to five year highs. - I think that Tom, Dan, you, getting laughed at by the traditionalists has proven to be a very good place to be. So the louder that they screech, the louder that they laugh, I've just learned over time, made your closer to the bullseye than you previously thought. So let them, let them attack. - As my father taught me at the racetrack, if you can find a scenario that you believe should be the favorite, and it's a long shot, those are the kind of opportunities that you have to basically wait for, be patient. And when they come, you have to be involved in them in a big way. And that's what I believe is happening with Tesla. That's what I believe is happening with Bitcoin. That's what I believe is happening with all of these macro arguments about this has to end badly because look what happened in 1800. The tariffs are bad. Look what happened before the light bulb the last time. It's really impossible for me to look 20 years ahead and not look at these people and be like, are you kidding me that you fell for the trap of comparing history when we were dealing with AI, which was also, should have been named, replacement intelligence. We're replacing all of labor. I don't know how to say this is not the same as the Industrial Revolution. This is not the same as the light bulb. This is not the same as the plow. We're actually getting to the point where every single job can theoretically be replaced with humanoids and with white collar, the gentip world. - I wish the best to the bears, but I believe the market will rip their hearts out and they will all be very upset. And so if you are an investor staying at home, I would just be very careful listening to all the dunes day predicting and the bubble talk, there will be a bubble one day. I just don't think we're near it. I don't think you do either. - I think there can't be one. And Tom said this yesterday, and I say this all the time, we've had three 20 plus percent corrections in the S&P 500 over the last five years, three. From 1990 to 2000, to the dot com bubble, we had one. And that one lasted for literally like a week. And it was during LTCM and then they cut rates and it went right back up. We've had three of these now. If you go back to my time thing and you think about what exponential innovation means, if you compress time, the concept of a cycle disappears. If you compress it to instantaneous, we've had three major advancements in curing cancer over the last week from artificial intelligence. We are still in the beginning stages for people to fade that cycles are dead and that the cycles are now a boom bust. The 30% correction in the S&P used to be a bust. It happened. - Correction for ants. - Just rallies back faster. And Tom said, we're gonna see, he even said, next year I think we'll have 20% correction in the S&P. I think we'll have 20% correction in the S&P next year too. I think we'll have one almost every single year, but that is more of a function of the pain that's gonna come between the voters and the politicians and all of the things that have gone. That's what makes the China US thing so important. We could come back in here in two weeks and she could have walked away from the table and the market could fall 20%. That doesn't change the inevitability of AI. That doesn't change the inevitability of this. Unless there's a war, I don't think you can stop the certainty that will happen with artificial intelligence and you have to put that into your mindset. And that's why for people, Dan Ives, Tom Lee, myself, we all believe in artificial intelligence and what it's gonna do. For macro people, they just say it's a bubble and they don't spend time on it. It's just a parrot, it just answers things. Humanoids are coming and autonomous vehicles are coming. So if you wanna be positive, those are things to be positive, but there's a negative that comes and for five years, I think the labor versus capital thing is gonna be a hard thing from a society basis to deal with. - I agree, we'll see you guys next week.