Hello again. It's nice to see you so soon. Here we are between episodes,
and I wanted to do something a little different.
I've recently been trying to optimize the workflow and production process around the show.
And so in full transparency, I thought we'd do an audit together and review
some of the rejected clips that my agentic producer set aside.
Rejected from episode 101. So what we're going to do is I'll play the clip that
was rejected. then I'll review the reason that the agent cut it from the episode.
Of course, I review those as well before the episode.
And then I'd like to see if you agree with them or not. And I think this is
just a nice way to set a baseline to see how this thing is doing.
So we'll start with our first rejected clip from episode 101.
It looks really like it's bottoming because the fundamental story of crypto is quite positive.
This, of course, is Tom Lee back on CNBC once again.
And he's feeling bullish, which Tom, never. DAVOS SHOWS BANKS ARE REALLY.
Embracing crypto there's regulatory bills coming
that are favorable to crypto and in fact
you know we saw announcement even today blackrock is
going into defi he sounds defensive with uniswap i mean that's people might
say that's a degen move it is so crypto has a lot of sort of tailwinds but the
price action is terrible too well it was because it was 67 when he said that
all right so why did the agent cut that clip?
The agent said, well, one, it's too soft, too short, too price call adjacent.
BlackRock and Schwab will make adoption cases better later in the show.
I think it's probably right. We did have a Schwab and BlackRock clip.
We didn't need that Tom Lee clip.
Tom Lee doesn't have a particularly great track record. I would have added that. So it recommended a cut.
It doesn't always recommend a cut, but for that clip, it recommended a cut.
And I think I agree. I'd like to know what you think.
Alright, that was kind of Let's try our next one and see what the agent decided to clip.
This I saw getting passed around a lot on social media this week.
It seemed to really get people excited.
So I definitely had to give this one a couple of considerations before I agreed to cut it.
Because they're so volatile, even small amounts could translate to much larger levels of risk.
This is an educational video that has been released by Charles Schwab,
And it's aimed at their existing customer base.
You probably know who that is. And trying to warm them up to the idea of dipping
their toes into the Bitcoin waters.
Let's look at a quick hypothetical example using Bitcoin.
A theoretical investor with a moderate risk appetite might split a traditional
portfolio 60-40, 60 percent stocks and 40 percent bonds.
Stocks consist of almost 100% of the risk in that portfolio because they're far more volatile.
If that investor decides to add an even more unruly asset like Bitcoin,
they might only want Bitcoin to make up 10% of the portfolio's risk.
According to the Schwab Center for Financial Research, that investor might want
to invest no more than 2.7% of their total portfolio in Bitcoin.
An aggressive investor, say they typically put 96% of their portfolio in stocks,
might be comfortable with 20% of the portfolio's risk in Bitcoin.
That would translate to an allocation of just under 7%.
Other cryptocurrencies like Ether are more volatile than Bitcoin,
so you may want to consider investing even less.
It's a bit non-traditional to think about it from a risk perspective rather
than an overall portfolio percent perspective.
Bitcoin's volatility means it has an outsized risk.
It's an exponential relationship, so small increases in Bitcoin holdings can
lead to larger increases in overall risk exposure.
Cryptocurrencies can be complicated and confusing for beginners.
Start by learning the basics, understanding the risks, and your own risk tolerance.
Remember, if buying cryptocurrencies currencies
themselves is too big of a jump at first you
could consider starting with exchange traded products that
you know let's just go back for a second here the risk right the
risk consider the risk but what is the risk with bitcoin what is it that it's
volatile that it's volatile is that really the risk you don't get growth without
volatility isn't the dollar volatile it just goes in one direction mostly like
that's the risk is the volatility because otherwise there's no sovereign risk.
There's no corporate risk. It's completely decentralized.
It's a fixed issuance schedule. It can't be changed by any individual.
And there's no one particular leader. So the typical risk that you would have
with other assets and other investments are not there, but yet they keep talking about risk.
Risk, risk, risk. It's a risk asset. Consider your risk. What's your risk appetite? How much risk mix?
Risk, risk, risk. But the irony is it's the least risky asset,
it's just the most volatile for these traditional investors.
And I just feel like, yes, there is risk around volatility. But if you're investing
for 10 years, we need to proportionally talk about risk.
Buying cryptocurrencies themselves is too big of a jump at first.
You could consider starting with exchange traded products that include cryptocurrencies,
although those have their own risks as well.
If sovereign ownership of assets is just too scary for you, you know,
like owning a car or a house or maybe having pets or being responsible for another
human life, if that's just too much for you, then we recommend a Tamagotchi.
Never invest more than you can afford to lose, whether you're looking to trade
crypto actively or take it on as a long term investment. Nobody.
I mean, yeah, this is it. That statement right there. Only.
What did he say? Never invest more than you can afford to lose.
That is. That's just for boomers.
Nobody else. I mean, other than people that are very well off already. Like you.
Everybody. The reason why people are aping into prediction markets and shit
coins is because they need outsized returns.
They've got a couple of hundred bucks. They got a thousand dollars if they're
lucky to scrape together.
Right. So, you know, what they can afford to lose, they've got basically nothing to lose.
That's the new investor. The new investor has nothing to lose.
And they just don't get it.
Whether you're looking to trade crypto actively or take it on as a long-term
investment, coming from a risk management perspective can be helpful.
Patience, discipline, and consistent learning. Coming at it from a really vague
perspective can be helpful. To help you introduce crypto into your portfolio.
So all they've done is talk about risk. They've not really this is not educational.
All it tells you is, yeah, you could do some Bitcoin. Just think about the risk,
but maybe consider this much Bitcoin, but consider the risk. What are the risks?
What are they? It's like telling somebody to avoid sexually transmitted diseases. Okay.
Well, what are they? What's sexually transmitted diseases? How many are there? Which ones?
Are some different than others? There's a bit of nuance to it.
Oh, people were loving that video. People were loving that video.
That just got me worked up.
Anyways, here's why the agent cut it. Let's see what the agent says.
Useful educational framing, but repetitive and less newsworthy than actual the
Schwab rollout clip that we'll play earlier.
Don't use both clips. Use one or the other. And that is the part I agreed with.
So I went with the one that was actually, I thought, more useful.
But it is still notable that Charles Schwab is putting that out.
So there is that. Of course, I had lots of clips from the testimony from Kevin
Warsh that I did not play in 101. I didn't need to.
But I did think maybe I should have played this one. I'd like your take.
The agent also thought to cut it. So ultimately, I chose to cut this clip.
Didn't add a whole lot, but maybe just a little bit of insight into how Warsh
is thinking about justifying future rate cuts.
My preferred definition of stable prices is a little different than most academics.
I believe that price stability should be a change in prices such that no one's talking about it.
That's an old-fashioned definition, but I think it's still valid.
The sooner that we can reform the institution, with my colleagues if confirmed,
the sooner we can ensure price stability, and we can have a new set of leaders
atop the institution with high, credible, ethical standards,
to return the Fed to what it should be.
The independence that both Chairman Scott and Senator Warren mentioned, critically important.
But independence has to be earned. And it's earned by delivering on the promises,
the commitments that the Fed has made.
And as the Fed hasn't delivered on those promises, we shouldn't be surprised
that we hear politics that are entering the room at the Fed.
We need to get the politics out of it so the Fed can focus on its day job,
deliver on full employment and stable prices. Okay.
Yeah. All right. So clean, nice.
The agency, this was an optional clip.
I didn't feel like it added a whole bunch other than kind of a vague definition
of, oh, my definition of stable prices are people don't notice the price changes.
Well, that's pretty vague, buddy. That's pretty vague. All right.
Our next cut clip. That one, it labeled optional. This one, it says you should cut it.
This one, it says you should cut it. This is the Wells Fargo CEO,
and he has some pontifications on the macro environment.
Biggest problem the United States is facing now in the financial service world.
The biggest problem that banks have or financial service industry has.
Well, it's separated into kind of two different periods, right?
Number one is we have uncertainty with what's going on with the Iran conflict.
This is at the Economic Club of Washington, D.C., and the typical thing where
they're up there in two leather chairs with a table with a couple of glasses of water between them.
The markets, it's been a bull market for a long time. There's a huge amount
of liquidity in the system.
There is this underlying current that things are going to be fine for a long period of time.
I hate to sound like an old person, but there are a lot of people in the financial
services space, in banks and outside of banks, that have never been through
cycles, like a real cycle in terms of what that means.
There's a point at which that's going to turn, and that's going to have a whole
bunch of impacts that I'm not sure we all really understand.
Lloyd Blankfond always says, you can think all you want, and you have to think
about these things. It's usually something that you didn't expect.
So something's gonna happen but then more long term
it's just the question of the deficit are you worried about the
value of the dollar the dollar has gone down since President
Trump has been office he doesn't seem to be saying as many administrations say
we want a strong dollar or do you think the dollar will I think it's something
you got to be conscious about I think it's something we've got to be conscious
about you know the position the US dollar has in the world we can't assume that
we just have this God-given right to be the reserve currency,
But it's going to take a long time for people to get comfortable with something
else other than the dollar. And it's in our control.
What about the U.S. debt? We have, you know, $39 trillion of debt.
And that's one of the issues that's got to get solved.
And that's just the hard one because you've got people who are in office for
four or eight years. They've got their own agenda on what they want to accomplish.
They're not going to be there to solve that problem. And they don't have the
same kinds of immediate pressures that companies have when they become overleveraged. All right.
So that clip, it recommended a cut and I agreed.
I mean, he has some decent macro caution there, but it's really broad.
The agent noted too, it wasn't specifically tied enough to Bitcoin.
So we didn't really need to get there, which I thought was also true.
And then his observations, in my opinion, were pretty generic,
pretty obvious. You know, the politicians, they're only in there to four to
eight years. So they have more immediate concerns.
But, you know, our problems, they go much longer than 40 years.
Yeah. OK. Everybody knows that.
Right. So this is that's your big macro analysis, Mr. Wells Fargo CEO.
So I agreed to cut that one.
All right. Let's play one more. I've got how many clips?
Let's see, how many clips got cut? Just to give you an idea,
16 clips, and that's after I went through and deleted probably four or five.
So it's just under 20 that were reviewed and considered for this episode but didn't make it.
So let's play one more because this one I considered, but ultimately I'll tell
you why I didn't go with it and we'll see why the agent didn't go with it.
But it does seem like there has been some kind of behind-the-scenes grievance
progress with the Clarity Act.
And it may have not gone the way the banks wanted it to go.
I can understand the banks being upset with Coinbase and other companies because
they were forced to accept this, I think.
I mean, initially, you know, many of the banks are saying, well,
no, you know, we're going to get there, but we're not there yet.
Yeah, look, I mean, really interestingly, we have actually partnership with
some of the biggest banks around the world, including the biggest U.S.
Banks, because they understand the future is tokenization and stable coins.
This is Coinbase's chief policy officer. A partner to build with.
We're excited to be the partner of the biggest banks. So she's asking a very awkward question.
Basically, she's saying the banks are pissed off that you used your ties with
the White House to force us into this position.
What do you have to say to that? Coinbase.
Right. So what's he going to say? Yeah. Well, you know, we got bank partners
that we partner with on business partnership stuff that is super partnery.
The Beltway is a funny place, Maria, as you know. There's a kind of an ecosystem
of people who spend all their time fighting over things in Congress.
There's a bit of a disconnect with what we see in D.C. and what we see with
their business folks. I think we'll be able to resolve that.
The banks are critical as a part of this future, on-chain future.
I think there's a lot of opportunities for them.
We want to help them get there, and I think we're excited about that.
So right now, you can pay. The legislation, as you know, it will be that,
yeah, you can pay rewards if you're part of a membership program.
Real quick, explain where you're expecting clarity to land.
So the law of the land is if a customer has a balance on our account, we can pay them a reward.
The banks have got really concerned about this. They said, no,
no, there has to be some activity before you qualify for the reward.
We've conceded that point. It's just a matter of what the fine print looks like,
and I think we'll get there. Uh-huh. Yeah.
So I think Maria spilled the beans there, don't you? There's going to be like
a Coinbase plus membership perk, right? You become a Coinbase plus member.
And as part of that membership perk, you get, you know, a little extra yield
on your stable coin that sits there in a Coinbase private bank account.
So your Coinbase CBDC, which they co-own with Circle, they're going to pay you
yield once you pay them like 10 bucks a month.
For something that's just melting away with inflation. All right.
So why did the agent cut that?
They recommended a full cut, not just an optional, but a full cut because it
was rambly and more about Coinbase bank politics than Bitcoin.
Not clean enough for the show. True. I felt that way about the Clarity Act the entire time, agent.
But it seems that the market has decided, you know, and this is why I've kind
of stopped talking about it is because the market stopped caring.
And it really stopped having an impact on – for a while, we kept hearing from
investors. I don't know if they were just bullshitting or what.
But for a while, we kept hearing from investors, well, I'm waiting.
I'm waiting to see where clarity goes before I deploy more money.
Well, that doesn't – the ETFs are ripping.
Things are going. So that doesn't seem to have really been a factor anymore.
I use just an idea of a few other clips that were cut.
I cut a couple of FUD clips. I just didn't need to do it.
Probably the biggest one this
week was Ben McKenzie. He went on Jon Stewart's – I think it's a podcast.
It was long. It was partisan, and it would need constant cleaning up.
And I like the way that the agent labeled it. It said it would hijack the segment
into an anti-crypto grievance TV.
It really, I mean, it's, I'll play just a second for you because it's so dumb and so bad.
Last year, a crypto organization estimated, crypto company, estimated that $154
billion of illicit activity was financed via cryptocurrency.
$154 billion last year. And that was a crypto company that made the estimate.
Here's what's fucking crazy about that. Donald Trump is literally shilling for
the product that allows our enemies to avoid our sanctions.
You see where they go here. So number one, $150 billion is chicken scratch compared
to the amount of illicit activity that would be financed in U.S.
Dollars or euros or pounds alone.
Let's be real about that. I mean, it's absolute pocket change.
So there is a lack of perspective in the analysis.
And then they immediately go to a Trump attack. Now, the thing is,
is they're talking about a technology, not a product.
But they refer to it as a product, as a thing, right?
It's like saying TCPIP enables our enemies to avoid our sanctions.
It's just the wrong level to do an analysis. And neither one of these guys is
appropriately equipped with,
to do any of this kind of discussion. Ben McKenzie's a joke.
He wrote a book a couple of years ago after he got rugged on scams that bit.
I believe, and I could be wrong, but I believe the background is Ben McKenzie
was warned by Bitcoiners not to get involved with some altcoins.
Ben mocked them and told them to go to hell. Then Ben got rugged and got butthurt
on the internet and Bitcoiners had a laugh.
And ever since then, he's had a grievance. So that's Ben's angle.
And he wrote a book and he's an actor.
And sometimes for Elizabeth Warren, and he'll go sit in front of a Senate hearing
and he'll talk about how dangerous crypto is. And I've played a clip of that in the past.
The other FUD that I decided not to play, and I agreed with the agent's recommendation
for a cut here as well, was CoffeeZilla.
I mean, it was an interesting video and the agent agrees with that,
but it opens up completely different can of worms around micro strategy and strike and all of that.
And it's extremely monologue heavy. There's sponsor segments that I have to
like sponsor stuff I'd have to weave around and it's not connected to the current
macro arc. So the agent recommend cutting it, and I recommend cutting it too.
I'm generally mostly a fan of CoffeeZilla.
Every now and then, especially since he's been doing the Void stuff,
the CoffeeZilla Void videos, he's kind of just popping off.
And I don't know anything about Strike. Don't know if it's a Ponzi or not.
However, people that do seem to be very smart analysts seem to think there's something to it.
And what I did notice is that he didn't have anything concrete.
He just had vague references to Ponzi schemes and scams and crypto and stuff like that.
He didn't really have anything that he could point his finger to, and it was.
The opposite of a researched piece. It was just off the cuff.
And so ultimately, I decided to cut that FUD busting too. Just didn't need to spend my time doing it.
It just didn't really seem worth it. I was a little disappointed to see it. And I did see it gain.
Sometimes how much something gets spread around the internet also plays a factor
in my decision if I should address it just to help people understand and respond to it. But yeah.
Another one that I thought could be interesting, but went on for too long,
was the Trump's investments in different cryptocurrency projects.
But I think a lot of that's pretty well known.
Didn't really need to retread ground there.
I cut a lot of the AI and other clips and a lot of the political clips for the
worst testimony, but I already talked about that.
So that's kind of a high-level overview. There's a few others in here.
I mean, we almost cut nearly 20, including some AI stuff.
Some AI stuff outside of the testimony, like from Dario and whatnot.
But I'd like to know what you think. If any of those clips that I have played,
should they have made it into the show? And do you disagree with the reasons that they were cut?
I thought it'd be nice to do a review of this, see how it's going.
It's a system I'm going to continue to refine, and I do every week a little bit.
But it's nice to kind of have something go over and do a pass, all of this.
Because as I collect these things throughout the week, at the time I collect
them, I have these ideas and thoughts about them.
But sometimes as the week goes on, it's nice to have these refreshers and have
something go over and collect and kind of give me a take. Something to at least
kind of check against, too.
So I may do this again. We'll see how much of a process this requires to have the agent get it right.
But I thought it was an interesting start and why not be transparent about the
process at the same time alright that's it for me thanks so much for joining
me on an in-between episode.
Let me know what you think which of those clips should have stayed if any or
maybe you think all of them should have gone perhaps you agree.
Thank you very much and I'll see you back here for episode 102.