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Thank you.

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All right, here we go.

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Woo!

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MSTR True North, episode 24. We are going to get after it. We're going to have some fun today.

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And we are here with the whole crew. There we go. Let's get this off the screen.

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All right. We're back. Episode 24, The Bitcoin Orchestra. We're here to talk about

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everything going on in the Bitcoin ecosystem, in the Bitcoin world right now, including MSTR,

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of course. We've got a fun agenda today. We're going to talk about MSTR Leverage Update. We're

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going to get into Strategy World and MSTR True North World and what's going on on the True North

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World update, the Bitcoin Orchestra and Financial Harmony. We're going to talk about all of these

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products that are in the market right now and kind of give some perspective onto where we're at in

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the world of financial products. A little bit of background on mortgage-backed securities and the

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timeline, the development and expansion of mortgage-backed

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securities starting in the 1960s.

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Maybe a little bit on decoupling, talk about liquidity,

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troubled asset relief program, Powell, Panic the movie

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from 2018 on the 2008 Great Financial Crisis.

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And we're gonna have a conversation.

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We're gonna see where it goes.

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So we have not really prepared much for this.

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We've got a lot of topics and we will get after it.

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So without further ado, maybe I'll kick it over to Tim for not financial advice.

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Hey, can you hear me?

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I can hear you.

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All right.

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I'm broadcasting live from upstairs at PubKey, so pretty cool.

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Everything you're going to hear tonight is not financial advice.

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Might be fun.

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Might be entertaining.

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You might fall asleep to Ben Workman doing his thing.

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but not financial advice. So, um, did I come up here for the first time tonight and see

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Fong's signature and put my signature on the wall right beside him? Maybe back to you, Jeff.

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Amazing. Yeah. And Tim was actually playing the guitar, the, uh, deep purple smoke on the water

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intro. So thank you. Thank you, Tim. All right. That was sexy, sexy DJ voice right there.

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Yeah. He's got the perfect mic and everything. So, okay. And for those that are new here,

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MSTR True North. This is a group of people we get together every week. We talk about what's going on

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on MicroStrategy, what's going on with Bitcoin. Everybody on the screen has been in this trade

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for an incredibly long time and are very invested in the outcome of the market and all of the macro

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and micro impacts throughout the trade. So we're all constantly thinking about what's going on in

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the market. We all have different backgrounds and all have different perspectives. So we bring this

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holistic view of the market. So let's get after it. We are going to jump into the MSTR financial

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leverage. So let me share my screen going back here. Okay. So we do this weekly. So this is the

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MSTR financial leverage update. MSTR bought more Bitcoin, about 3,000 Bitcoin over the last week.

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and this should say 4 16 25 they now hold 531 644 bitcoin the bitcoin price right before this was

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84 322 and for a total bitcoin assets held of 44.8 billion dollars 8.2 billion dollars of debt

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which doesn't include preferred stock 1.6 billion dollars preferred stock and net capital if you're

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to take the assets minus the debt minus the preferred stock, you're sitting at $34.9 billion

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of net capital. That net capital alone would be one of the top 250 companies ranked by market cap

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if you're just to take that net capital and compare it to the market cap of some of the top

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publicly traded equities. So it's a very significant value that strategy is holding

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in excess of the debt that they've got on the balance sheet.

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We've got a total leverage ratio of 21.9% and a debt coverage multiple of about 5.5%.

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And the Bitcoin price needed for the assets to be less than the liabilities would be around $15,469.

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Again, that's just a proxy number.

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That number doesn't mean anything.

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Bitcoin would have to trade down below that number and stay there for an extended period of time in order for...

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And strategy to not have an ability to refinance their debt in order for that to potentially be a problem.

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So it's exciting times.

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Exciting times to be following MSTR.

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Exciting times to be following Bitcoin.

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and it's one of the strongest financial companies I have ever seen in my entire life.

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Strategy would be the third largest solo reinsurance entity on the planet just from

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the capital held alone. So very, very large, very strong financially. Okay. And with that,

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maybe we'll kick it over to a grain of salt. We'll talk a little bit about Strategy World,

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MSTR True North World and what's going on

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on that front?

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Hey, so it's been going great. We're really looking forward

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to seeing everybody that's signed up to go to

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MSTR True North in Orlando.

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We have, I believe, seven remaining

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attendee tickets.

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We have two remaining sponsor tickets.

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So they're going really fast. As we said

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before, if you'd like

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to attend, you do have to purchase

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a Strategy World ticket. Along with that, we have

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our own code, MSTR True North.

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So that sign-up page is there.

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it's ready to go. We're looking forward to see everybody. We've really been working a lot on the

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content, what we're going to present. We have a few surprises for everybody, which we're not going

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to mention until you get there. So I think it's really great. And next week, we will be at the

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Bitwise event in New York City. And you should stay tuned to see if potentially we have a little

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meetup in New York City at a bar on Wednesday night, and we'll be there on Thursday. So that's

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what I have right now for for Strategy World and MSCR True North in Orlando.

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And just to just to top it up there, we have seven tickets remaining. So seven tickets remaining on

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the general admission side, you must have a Strategy World pass in order to attend. This is

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occurring on Monday, May 5th of Strategy World. So Strategy World goes from Monday, May 5th through

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I think Thursday, May 8th, something like that. And we have two sponsor level tickets remaining.

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A sponsor level ticket is only $500. That gets your name up on our presentations. It will,

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you know occur in between slides we'll give everybody a shout out you have the ability to

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pass out pamphlets if you want and that includes a ticket to mstr true north world as well

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all of this information is up on mstrtruenorth.org and you can find more information there you can

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get the event bright you can go grab a ticket there and we look forward to seeing everybody

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the whole crew that's on the screen will be there and uh yeah we look forward to having

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conversations. We've got a party afterwards. Drinks are included. I think we'll have some

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light bites from 7 to 9 p.m. And yeah, it's going to be a great time.

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And by the way, if the party continues going, we could extend it even longer. So let's get

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everybody out there and have a really good time. We're not limited by that timeframe. So I want

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everybody to get out there. And I think the event will be great itself for the conference, but we're

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really looking forward to the party. I think this whole thing is just going to be incredible. I mean,

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I think everyone's going to be surprised when you see the list of companies that have stepped up to support this with the sponsorships.

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I've been just completely surprised by the reach that this has had since it used to just be a group of guys keeping everyone up till midnight to talk about one single stock on the Internet.

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And all of a sudden now we've got a conference at kind of the Super Bowl of events for people that cover microstrategy.

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and the companies that have stepped up to support us as we're doing this and to, you know, make the

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party possible has been really awesome. So keep an eye out. We'll be getting those out there on

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the website here pretty soon so that you guys can all show support to these companies.

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Yeah. And there's even a couple of people that bought tickets that said they want to remain

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anonymous, but I think you'll be able to spot them immediately. So I think that we're not announcing

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certain things and you'll see when we get there. We're also working on recording the event so we

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could actually present it afterwards and the presentation materials will also look to post

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the agenda that that jeff is showing right now there will be a check-in that'll happen before

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in order to get your wristbands and then you'll be able to get inside to the conference we're

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going to start at 12 noon sharp you can see the agenda as we go through it there's also the

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strategy world party you have to have a strategy ticket to get into that and then our party is from

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seven tonight. Bingo. Nailed it. And we're not going to provide any lunch or anything. So I know

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that lunch is kind of smack dab in the middle of our keynote. So I would be grabbing food if,

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if you need to before, before the event. Perfect. All right. Thanks, Green. Anybody else have

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anything to add on the true North world? Just as crazy to it got to this point.

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you had told me when when you when you told me that when you and i um talked back in february

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last year that by may of the following year we would have an event we would have our own little

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conference we would have our own um focus at the event i would have been like right that doesn't

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seem like it makes any sense at that point i was still posting the dream on face every time we rip

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up 20%. So this, this is crazy to see. I'm looking forward to it.

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It should be exciting. Yeah, I just I just think it's great.

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We are the living embodiment of you can just do things. You

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can just do it. Yeah, exactly. We are that meme you can just

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do it. We mean this existence. We literally did. Like we got

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together, we started messaging each other. We liked the stock,

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we started talking even more. We started streaming and the rest

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kind of just just kind of happened.

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So I think this is great.

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I want to see how many years we can do this in a row.

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This should become a thing now is what I think.

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Absolutely.

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I think the next one's in February.

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So we're already looking forward.

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There's so many things going on.

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And I cannot emphasize enough,

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some of the small conferences,

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I mean, we're going to have 150 people

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at MSTR True North World,

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I think something like 250 at Strategy World.

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The small conferences that I've gone to historically

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have been the absolute best.

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You get just incredibly close face time

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with some people that you never would imagine

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that you get FaceTime with.

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You can ask questions.

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There's good conversation.

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It's really personally,

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it's helped my conviction

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going to some of these conferences

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and talking with some of these,

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you know, well-known financial professionals

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that are managing billions of dollars.

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And you're like, oh my God,

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you're a real person.

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It actually goes a long way.

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So yeah, pretty surreal.

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The whole thing's pretty surreal.

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And the conference is another immaculate conception

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because we were just trying to have a party at first.

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Yeah, that's true.

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All of a sudden, I would have a freaking seminar.

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became a lot more pressure all of a sudden huh first we were just going to be the good time guys

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and you know we've got a conference going so what a turn of events that took

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exactly one of a bar because someone in the in the chat just said i'd like it irresponsibly

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long island iced tea that's the drink idea right there irresponsibly strong

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yeah yeah we're gonna we're gonna have basically the tropical drinks being

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served. Like Jeff said, we'll have small bites to eat. Somebody mentioned breakdancing. Well,

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folks, we do read the tweets here, breakdancing. I will work on the music list. If people have

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requests, you could post that up with songs you want us to play at the party. We'll see

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what we could do with that. We did not hire a DJ that was not on the list, but maybe we'll

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have to get working on that.

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absolutely it's gonna be fun okay shall we shift gears topic number three this bitcoin orchestra

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and financial harmony so uh thanks grain thanks thanks for all the hard work every actually one

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more thank you to everybody on the screen there's people behind the screen that are doing a bunch of

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work we have got this team that we just started to build and establish that has uh you know donated

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a lot of time to growing this community and uh thank you to everybody that's put in a lot of time

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and effort in growing and helping us out here. It's going to go a long way. We are this decentralized

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node appear in the Bitcoin network that's growing MicroStrategy. And it's pretty incredible. The

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community has really come together to help grow this. So ethos has gone a long way.

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Yeah, there was a question about the event will be recorded. We will post it up. We'll post up the

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the presentation that we're working on.

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And then somebody had a question about

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what happens if you miss check-in,

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there'll be purple wristbands,

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that'll be people, either the VIPs

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or the people running it.

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So if you just walk over a person with a purple wristband,

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they'll be able to get you checked in

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and give you an attendee wristband.

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So we've worked on this

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and there's a lot of pieces that we put together.

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Yep, beautiful.

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Thanks, Green.

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Okay, let's get into this Bitcoin financial harmonies

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because I think we're in this relatively new world of financial products that hasn't existed before.

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And we are seeing the advancement and the securitization of Bitcoin that hasn't existed before.

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We've seen this with strategy coming out with convertible bonds.

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Now they've come out with preferred stock.

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You've got strike.

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And then they come out with another preferred stock that's strife, perpetual strife.

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Now you've got MSTY and IMST and MSTU and MSTX.

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And now those are those are seven products that are all correlated to Bitcoin moving directionally in the same direction that have different risk return metrics and can fit an entire portfolio.

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And, you know, I tweeted this last weekend, I was playing with Monte Carlo simulations, because this is a really fascinating development and evolution of the Bitcoin network and the Bitcoin ecosystem that you can now have one portfolio that fits multiple different needs for a person, a portfolio, right?

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So you can have leveraged long exposure and you can have reduced volatility bond like exposure all on one single asset being Bitcoin that this is securitized on.

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And it's a really neat evolution because every single product has its own risk return metrics within that ecosystem.

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system. And those risk return metrics can be run on, can be run in a Monte Carlo simulation,

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which is 10,000 simulations running different, different volatility metrics, different standard

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deviations and different means and different directions based on underlying assumptions.

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And over the weekend, I was able to crank through some of this analysis just by using Grok. And

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then just today, I was able to use Grok to develop Python code to run this manually myself,

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and be able to iterate on it multiple times over and over.

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So I in the process of developing that and building out a perspective on a portfolio basically modern portfolio theory just using Bitcoin correlated equities And I mean the evolution of this is going to skyrocket And I wanted to talk

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a little bit about mortgage-backed securities and the historical timeline here because...

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So, Jeff, before you go on...

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Jump in.

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What you just said there is really important. The maturity or the maturation

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of the market where we were even from Q3, Q4 last year to where we are today with having even

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the YieldMax MSTY product and then the Bitwise IMST products that got launched. Just that overall

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space has fundamentally changed. And like you said, also with Strike and Strife and so forth.

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So a lot of these products were not available in Q4. And now you have what I would call trading

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pairs where you can go from the more volatile assets and then drop back to the less volatile

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assets. So I think that that's a huge fundamental shift that's happened over the past five months.

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And then the other part that I would say, I want to give a call out to Dan. Dan wrote a great write

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up today on the differences. And actually, you know what, Dan, you should just say what you wrote

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today because that goes to the differences between those. So that was a great analysis on Strike and

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and SDRF and MSTY, if you wanted to just do a quick shout out about that.

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Appreciate it, Grant. Yeah. Jeff, should we get into that later?

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Yeah. Hop in right now. Honestly, jump in. And we can talk about mortgage-backed securities next.

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Like I've got some history we can walk through. But yeah, please jump in.

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Sure. And I imagine...

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You there?

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Yeah, we can hear you.

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Sorry, something was weird there.

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Okay.

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You're good.

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You're all set?

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All good.

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Yeah.

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So Ben and Jeff, you guys are probably, Adrian, Tim, and Salil, you'll probably have kind of critiques on the way I'm going to describe this.

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But for me, at least, the strike thing kind of clicked today.

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And I know it's clicked for different people at different points in time.

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But I want to share that revelation with everyone who's having a little bit of trouble understanding it.

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And so I think the first point that I didn't fully understand was I understood there was some upside with STRK, but I didn't understand how the conversion worked or how the call option part worked.

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And I was thinking about it from a traditional call option on an equity.

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And I've started to think about it a different way.

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So you've got that 10 to 1 conversion from the STRK to the MSTR, right?

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And you also have the liquidation preference.

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And I'm starting to think of those two things as being different.

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So the conversion gives you kind of how much claim over MSTR Class A shares you have.

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But that claim is actually superior to the MSTR Class A shares themselves because you're

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senior in the capital structure.

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So that's kind of an interesting critique.

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And so right now with MSTR trading at $317 a share and strike trading at around $85 a

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share, you could argue that $31.7 of the value of STRK of that $85 is technically class A MSTR

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shares, but a bit superior because they're not actually class A shares. You're senior in the

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capital structure. Then you've got the rest of that, about $52 worth of value. And that's some

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function of the yield created. It's a preferred fixed income product. So the yield creates that

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other sort of value. Or you could look at it as in its entirety being the yield is represented by

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the entire price of SDRK. But I think it's interesting and neat to think of it as part

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class A MSTR shares and part of bond, just a straight fixed income bond. And if you were to

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price, the coupon payment based on the part of STRK that's not represented by the class A

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conversion rate, then you get a 15% yield on just that part alone. So that's another way to think

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about it. If you're going to be long MSTR class A shares and you want that fixed income coupon

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payment, owning STRK actually gives you a higher dividend yield than just allocating to strife

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and Class A shares themselves.

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You get like a super discounted option,

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call option on the equity.

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Yeah.

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Exactly, yeah.

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And Strategy Tracker,

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the thing from Lizard Wizard Radu,

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he's put together this MSTR versus strike price,

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which just shows right here in the red.

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This is the MSTR price.

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And then the strike price is blue here,

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which is pretty flat.

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But you can see 10 shares of strike

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convert into one share of MSTR.

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So you now got this like strike to MSTR ratio.

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So you can see this kind of richness or cheapness relative to that option premium, which is an interesting component, you know, to add into the mix.

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Right. There's there's so much chaos here and all of these different products that move differently depending on different things.

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And I think an interesting thing here is I know I think, Jeff, you'd you'd explain it as like different products based on Bitcoin.

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And the way I think about it are different bets you're making on Bitcoin itself.

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That's the way as kind of a trader or investor, I look at it.

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But so I think STRF is a really interesting example of the product MicroStrategy has created in terms of betting on the continuation of Bitcoin.

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So one way you can use it and the bet you could make is that let's say you believe that Bitcoin is a $2 trillion asset class and no $2 trillion asset has ever gone to zero.

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Okay, you believe MicroStrategy is a very over collateralized and financially strong company.

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You sit senior in the capital structure to strike and an MSTR, but you don't know where Bitcoin is going to go in the short term.

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So in my post, I mentioned it's kind of a short position on Bitcoin itself, but you're still long the survival of the network.

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You may be short the price action over a period of time and you may be holding STRF and getting that dividend payment.

294
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but you're still long in the sense that you believe Bitcoin will continue to exist and that MicroStrategy is a financially strong company.

295
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That's a bet I would want to make at times, right?

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If let's say the price goes crazy, the multiple gets out of hand and you want to take some off the table because you as an investor can't stomach a certain amount of volatility or don't want to stomach a certain amount of volatility.

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And this is only amplified by, you know, say a family office or some other investment vehicle.

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they can't stomach all kinds of crazy multiple expansion and contraction plus Bitcoin volatility.

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So they're making a bet on Bitcoin, not price directionally, but in terms of network strength.

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Directly. Exactly. And more products of that are going to come up. And I think we could argue,

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MSTY is a similar bet there, but you're betting specifically on the volatility and all these

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other things. So there's just so many bets you can make with these products.

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And we're talking about one company, right? With MSDR. Wait until the hundred companies that are

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Bitcoin treasury companies start offering all of the same things. And now you're like, oh my God,

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I've got all of these products that I could potentially add to a portfolio. And they're

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a function of so many different things, right? Like underlying business models, growth, yield,

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they're all going to have the different risk return metrics. I mean, Adrian, I'd be curious

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how you see these products. I mean, you've been in crypto, Bitcoin for a long time. I know there's

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some skepticism generally of like yield, right? I mean, we've seen everything with FTX and Celsius

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and BlockFi, all that stuff. And so there's this historical skepticism with yield. But now

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these yield products are a function of volatility in the underlying equity.

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and you don't have to put trust in a third party like FTX to manage their own individual

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leverage ratio. So I'd be curious to get your perspective on that.

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Yeah. So in the case of strategy, this yield experiment is entirely different. With BlockFi,

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with FTX, with Celsius, with all those other ones, they were attempting to generate yield by

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rehypublicating Bitcoin. And Bitcoin is not suited to that. It is a finite asset. It has a fixed

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issuing cycle, its very nature does not sit well with rehypothecation. So that instance where the

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blow-offs happened, that caused all of the skepticism with regards to the yield, as you

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mentioned. So the reason why I initially was skeptical about MicroStrategy back in 2020,

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back in 2021, was because of that. I was thinking to myself that, is this a company that's just

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going to be buying bitcoin and then trying to re-hypothecate it but as his as his um strategy

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no pun intended got fleshed out you saw that what he's done is i and this is why i call it like the

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strategy economy he has the on the bitcoin underlying he has the equity right he's turned

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that volatility into a product and he's essentially issuing shares to buy more bitcoin so that's one

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layer now and then before we had strike and strife we had mst we had mstx we had msty right those are

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the leverage plays those are the dividend plays now we have strike as a dividend play now we have

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strife as a preferred preferred perpetual preferred stock that pays a dividend we also have own b

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that has the um passive exposure to strategy because that's the etf that has

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all of the companies which are over a thousand bitcoin you also have b max which is the etf

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that's giving direct exposure to the convertible bonds. Now you have IMIS, right? That's very much

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an economy. And the reason why for me, I'm not skeptical or worried about the yield aspect of it

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now is because he is not using the Bitcoin to generate the yield. He is using all these equities

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and different offerings to generate the yield. That's a fundamentally different structure than

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rehab advocating bitcoin so for me i have had to take off my bitcoiner hat put back on my financial

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analyst hat from early in my career and start looking at things very very differently the

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volatility hurting that's hurting a lot of people's brains yeah to take off their bitcoiner hat

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you're like oh damn it you know okay your anti-establishment bitcoiner hat you gotta you

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kind of got to take it off and look at the whole environment very much so and it's an entirely

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different way of thinking about bitcoin the underlying asset of bitcoin and the equity of

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strategy and all of these different offerings on top of it what people and i don't let me be very

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specific what i say here what i think what many don't want to accept or understand is that that

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is making everyone a passive bitcoin buyer it is making everyone getting it gives exposure to bitcoin

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to all of these players in the market right and the that is only a good for bitcoin and he and

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sailor is doing this without rehypopulating the bitcoin they're just buying more and more bitcoin

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they're putting it on the balance sheet and it's the equity and all the different offerings that

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that are generating the yield.

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So these equities, let's say,

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and this is not me calling anything out,

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this is not me giving financial advice.

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If MSTU, MSTX, MSTY, if one of these things blows up,

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that doesn't hurt Bitcoin, right?

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So that just hurts that particular instrument.

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So it's not as if sailors then gonna have to go to market

354
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and start dumping all of this Bitcoin.

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MicroStrategy as a company,

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because of the corporate structure

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and because of how companies exist,

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he can issue the ATM in perpetuity

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on a rolling basis as he needs to keep afloat. He can issue convertible bonds to keep afloat,

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or if the market is beneficial, it is swallowing the market cap of the company. There's all kinds

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of different ways that this can play out to the upside, that there's very, very little risk in my

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mind in terms of these yield products existing on top of Bitcoin. And I think that is Bitcoin's ideal

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state as a base layer for money and as a base layer for the financial system and all these

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yield products that exist on top of it that i i think it just matches bitcoin perfectly i think

365
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sailor is using bitcoin as a base layer for this entire strategy economy bingo i think you hit the

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nail on the head and every single one of these products brings more capital into uh the derivatives

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market the options market so you have more liquidity in those markets and that liquidity

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requires market makers to go out and make the market which requires them to buy the underlying

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shares to make the market, which gives MSDR more kind of chaos and volatility, allows them to use

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the ATM more to add more Bitcoin on balance sheet. And this flywheel kind of gets continuously

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perpetuated. Yeah. And I didn't mention the options market. The options market is huge. At

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times it's been rivaling Nvidia. I mean, like think about that. Strategy is a fraction of Nvidia's

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market cap, but yet still the options market had more had as much or approaching as much open

374
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interest as Nvidia did. That is insane. And it's only going to get more and more ridiculous as this

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thing scales and as Bitcoin goes up in price. So for all these people that are saying that,

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oh, well, how's he going to pay the dividend? How's he going to do this? And Dan's talked about this.

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You've talked about this. The dividend payment is a fraction of the average ATM that he's issued,

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right? He's done some smaller issuance in recent months, but that's because I think he sees the

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market for what it is and he's being more cautious. If we look at the history of it and all of these

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different ATM offerings he's issued, paying the dividends on these things is not going to be a

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problem because of the very nature of equities and how they're structured. So I think a lot of the

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00:30:16,214 --> 00:30:21,294
calls for doom and gloom are much to do about nothing initially. Granted, if we hit a Great

383
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Depression right now, everything's fucked. And that is the outlier event that you have to take

384
00:30:26,994 --> 00:30:31,474
account for, right? Or if the tariff situation turns into a full-blown trade war and we see

385
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a prolonged market downturn. But even in that instance, he can still issue the ATM. He would

386
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just have to be far more strategic about how he does it. So I just don't think there's any issue

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in paying out the dividends, which is why I personally don't have as much concern about

388
00:30:46,354 --> 00:30:52,414
the yield products that exist on top of Bitcoin. Bingo. The ATM that was used this last week was

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$285 million used on the ATM.

390
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I think the current interest expense on Strike and Strife

391
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is around 160 million.

392
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So we're talking about 75% greater

393
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than the interest expense for the entire year

394
00:31:05,094 --> 00:31:10,094
was acquired using the ATM

395
00:31:10,094 --> 00:31:13,814
in one of the most chaotic market weeks

396
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for markets ever, right?

397
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In the history of markets.

398
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And-

399
00:31:20,514 --> 00:31:25,534
Everyone's been conditioned to the point where 285 didn't even show up on anybody's radar.

400
00:31:25,954 --> 00:31:28,634
There was no streaming in the streets about the ATM.

401
00:31:29,254 --> 00:31:30,234
They were like, why do you do more?

402
00:31:30,914 --> 00:31:31,114
Yeah.

403
00:31:31,414 --> 00:31:31,614
Yeah.

404
00:31:31,734 --> 00:31:32,934
Like there was a lot of volatility.

405
00:31:33,134 --> 00:31:33,254
Yeah.

406
00:31:33,254 --> 00:31:34,174
It's some more.

407
00:31:34,714 --> 00:31:34,874
Yeah.

408
00:31:34,874 --> 00:31:36,314
People were like, why do you strike?

409
00:31:36,394 --> 00:31:37,034
Why do you strike?

410
00:31:37,134 --> 00:31:41,794
Like it's funny how things change once people start to really accept and acknowledge what's

411
00:31:41,794 --> 00:31:42,414
going on here.

412
00:31:42,414 --> 00:31:48,234
And what's funny about this is this is all without strategy issuing, getting direct yield

413
00:31:48,234 --> 00:31:49,274
on their Bitcoin holdings.

414
00:31:49,994 --> 00:31:50,174
Right.

415
00:31:50,174 --> 00:31:56,594
when they start doing that oh yeah well I think I think they're technically getting yield right now

416
00:31:56,594 --> 00:32:01,094
because they're leveraging the collateral the collateral of their balance sheet so I mean the

417
00:32:01,094 --> 00:32:08,834
Bitcoin yield is I'm utilizing it as a uh as a product in to you know get additional yield but

418
00:32:08,834 --> 00:32:13,274
they are using it as collateral right now effectively by you know securitizing it on

419
00:32:13,274 --> 00:32:20,234
balance sheet. I think one thing we really need to acknowledge with strategy is what they're doing

420
00:32:20,234 --> 00:32:26,394
is the Trojan horse to bring people into Bitcoin. I bet there's a significant portion of the

421
00:32:26,394 --> 00:32:31,654
investors that are picking up these new products that don't really have any clue what's going on

422
00:32:31,654 --> 00:32:45,748
here but they driven in they yield hunters right They the fixed income hunters where they just looking for the best product Dividend bros Yeah Yeah And so they move capital into these products just because they offering attractive yields

423
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And once they get in, you start asking yourself the question, well, why can they offer these

424
00:32:50,428 --> 00:32:51,628
types of yields?

425
00:32:51,628 --> 00:32:54,468
What is it that makes this possible?

426
00:32:54,468 --> 00:32:58,548
And that is the quickest on-ramp to starting to understand some of the unique characteristics

427
00:32:58,548 --> 00:32:59,908
that Bitcoin brings, right?

428
00:32:59,908 --> 00:33:04,908
That volatility profile that when you couple that volatility profile with a corporate balance

429
00:33:04,908 --> 00:33:10,828
sheet, it creates this really unique ecosystem of products. And some of what you were talking about

430
00:33:10,828 --> 00:33:16,028
this past week, Jeff, when you're looking at constructing different types of portfolios and

431
00:33:16,028 --> 00:33:21,468
really tailoring those portfolios to what stage you're at in your career or in your investing

432
00:33:21,468 --> 00:33:27,388
life or where you're at along the retirement track. I mean, he just created the entire suite

433
00:33:27,388 --> 00:33:33,468
of products that you need if you're a believer in Bitcoin to customize your own portfolio.

434
00:33:33,468 --> 00:33:47,008
And I think that is going very underappreciated because the scale they achieved is allowing all this capital and all these new eyeballs to come into this ecosystem.

435
00:33:47,468 --> 00:33:56,128
And you don't start seeing this type of success without wanting to scratch beneath the surface a little further to see what is the asset that's making all of this possible.

436
00:33:56,128 --> 00:34:04,108
And a lot of the people that will pick up these high dividend yields are people that are historically very conservative investors.

437
00:34:04,528 --> 00:34:08,808
You're probably getting a lot of people that are in the gold camp that would come in and pick up these dividend yields.

438
00:34:09,968 --> 00:34:22,248
And I think that because people who have been in gold for so long understand a lot of the same problems that Bitcoiners do, this becomes a really safe way for them to enter the ecosystem.

439
00:34:22,248 --> 00:34:26,948
And I think we've done ourselves a disservice in the Bitcoin community with how hard we went

440
00:34:26,948 --> 00:34:33,068
at gold as being the shiny pet rock and all this, because the reality is those investors

441
00:34:33,068 --> 00:34:36,328
understand the same issues with the financial system that we do.

442
00:34:36,788 --> 00:34:42,928
They just haven't yet identified the benefit to having the digital form of that solution.

443
00:34:43,888 --> 00:34:48,288
And that's really powerful when you finally get that switch to flip in your mind.

444
00:34:48,288 --> 00:35:03,448
But I think that those types of investors are exactly the ones we want to come into this ecosystem because they're just one revelation away from also understanding the utility and the strength in purchasing Bitcoin, the asset itself directly.

445
00:35:03,448 --> 00:35:17,868
So what Saylor and that team have been doing in proving out these markets and achieving such scale that you can bring this type of attention and this type of capital into the ecosystem, that has been just a massive, massive benefit to Bitcoin as a whole.

446
00:35:18,288 --> 00:35:24,948
Well, also with that said, people have been asking why, talking about the US government

447
00:35:24,948 --> 00:35:27,328
printing money to buy Bitcoin.

448
00:35:27,328 --> 00:35:28,328
That's what Saylor's doing.

449
00:35:28,328 --> 00:35:30,928
He's printing shares to buy Bitcoin, right?

450
00:35:30,928 --> 00:35:34,888
He's doing exactly what people have been clamoring the US government to do for years now.

451
00:35:34,888 --> 00:35:38,488
So I don't, I still don't understand the skepticism.

452
00:35:38,488 --> 00:35:42,348
I think, and this is your point, Jeff, that you've made a lot.

453
00:35:42,348 --> 00:35:47,308
People have a very, very hard time reconciling capital markets and understanding their place

454
00:35:47,308 --> 00:35:50,748
in this and understanding how Bitcoin can be leveraged in that kind of an environment.

455
00:35:50,748 --> 00:35:54,028
And I think that's where a lot of the disconnect comes from, especially with Bitcoiners, because

456
00:35:54,028 --> 00:36:00,348
they're very, very anti-establishment. But if you're pro the US government printing

457
00:36:00,348 --> 00:36:05,548
dollars to buy Bitcoin, you should be pro-sailor printing shares to buy Bitcoin.

458
00:36:05,548 --> 00:36:10,908
It's the same thing. It's just by a different mechanism. So he's really doing what you've

459
00:36:10,908 --> 00:36:15,708
been wanting the government to do now for years. You should be cheering this on and hoping that

460
00:36:15,708 --> 00:36:21,308
he can continue it ad nauseum because it's only going to make bitcoin become what i like to think

461
00:36:21,308 --> 00:36:25,708
of as systemically important in the financial system because eventually the market cap is going

462
00:36:25,708 --> 00:36:30,748
to grow to such a point within strategy and the exposure points are going to get so much larger

463
00:36:30,748 --> 00:36:33,788
that you're going to have more and more players in the market and more and more players are going to

464
00:36:33,788 --> 00:36:39,708
start taking this playbook and really scaling it up look at gme gme is a perfect candidate once they

465
00:36:39,708 --> 00:36:44,428
make that first buy and once they start doing that first atm specifically to buy bitcoin

466
00:36:45,068 --> 00:36:52,748
there's no reason why leverage plays and different offerings can exist on top of gme on top of

467
00:36:52,748 --> 00:37:00,028
similar i mean the list goes on and on and on what happens when 5 10 15 20 companies start taking this

468
00:37:00,028 --> 00:37:04,668
economy of scale model that sailor's running and they start doing it bitcoin becomes systemically

469
00:37:04,668 --> 00:37:11,948
important or at least systemically relevant in in the in the near and and long term so it really is

470
00:37:11,948 --> 00:37:16,268
a win-win for all parties involved. And when I say all parties, I'm talking about Bitcoiners,

471
00:37:16,268 --> 00:37:20,508
I'm talking about the TradFi people, I'm talking about strategy, I'm talking about all of us. That's

472
00:37:20,508 --> 00:37:25,868
why I like to call it an economy. We're all adversarial and cooperative players in this

473
00:37:25,868 --> 00:37:31,868
market that Stator's created. And all of this is a function of Bitcoin's volatility, right?

474
00:37:31,868 --> 00:37:37,468
You got a $1.6 trillion asset that should probably be a $20 plus trillion asset, and it's on its way

475
00:37:37,468 --> 00:37:42,508
to become a 20 plus trillion dollar asset. And that's why I looked at the creation of mortgage

476
00:37:42,508 --> 00:37:48,188
backed securities in 1960, 1970, which is a really interesting parallel to look at here.

477
00:37:49,868 --> 00:37:54,748
Mortgage backed securities in the 70s, there was significant deregulation in the market,

478
00:37:54,748 --> 00:38:01,628
and there was significant capital that was coming in and wanted to access exposure to homes. So it

479
00:38:01,628 --> 00:38:07,308
allowed these investors from different locations to get access to pooled houses, which brought more

480
00:38:07,308 --> 00:38:13,068
capital into the housing ecosystem. If you would have bought a house in the 70s and you sat on it

481
00:38:13,068 --> 00:38:19,868
till today, you did incredibly well. And the creation of those securities also came with

482
00:38:19,868 --> 00:38:23,708
different forms of yield that didn't exist before. And so now when you're managing a portfolio of

483
00:38:23,708 --> 00:38:29,388
assets and pensions or whatever that may be, it was a drug that everybody needed.

484
00:38:29,388 --> 00:38:32,748
Right. Everybody needed mortgage-backed securities in their portfolio. They needed

485
00:38:32,748 --> 00:38:39,068
that hit of that yield. And that market went from just very, very small, like, I don't know,

486
00:38:39,628 --> 00:38:46,588
less than a billion dollars to like $60 billion in 10 years. And inflation adjusted is over $250

487
00:38:46,588 --> 00:38:54,268
billion, $250 billion in that market just for mortgage-backed securities from 1970 to 1979.

488
00:38:55,148 --> 00:39:03,388
And so massive increase in value in just a short time horizon from 70 to 79. And then we all know

489
00:39:03,388 --> 00:39:10,988
what's happened from 79 on, right? Like exposure to homes and mortgage-backed securities just

490
00:39:10,988 --> 00:39:16,828
absolutely ripped in the 80s, 90s, 2000s, and obviously led to the crash in 2008.

491
00:39:16,828 --> 00:39:23,308
So we're in this golden era at the beginning of Bitcoin securitization. And everybody's looking

492
00:39:23,308 --> 00:39:28,188
at these products like oh my god it's too good to be true it's trending to zero or you know whatever

493
00:39:28,188 --> 00:39:35,548
that may be but really this is this is the golden era of bitcoin securitization and everybody everybody

494
00:39:35,548 --> 00:39:40,188
here like the the objective is make as much money as humanly possible in the next 10 years while

495
00:39:40,188 --> 00:39:44,588
everybody doesn't know what's going on because of the bitcoin securitization in the market

496
00:39:44,588 --> 00:39:50,908
creating a portfolio that makes sense to you and that that's where i think we're just in this like

497
00:39:50,908 --> 00:39:55,868
monumental period of the creation of these securities that nobody really understands

498
00:39:56,588 --> 00:40:01,068
yet, or they don't understand how big and how important these can be yet. And anybody that's

499
00:40:01,068 --> 00:40:07,148
been studying Bitcoin and following along Bitcoin for the last 12, 24, 36, five years, whatever that

500
00:40:07,148 --> 00:40:12,748
may be, you understand the power of Bitcoin. Now you throw in this traditional financial ecosystem

501
00:40:12,748 --> 00:40:18,828
and the power of being able to structure finance and we're going higher. This thing is going way

502
00:40:18,828 --> 00:40:25,628
higher look at the education this has given people i mean when when this all started i don't think any

503
00:40:25,628 --> 00:40:30,668
of the retail investing community could have imagined that they would get an education in

504
00:40:30,668 --> 00:40:34,748
all the different pools of capital that are out there and all the different types of institutional

505
00:40:34,748 --> 00:40:40,268
level players that are out there talking about the gamma traders figuring out the duration and

506
00:40:40,268 --> 00:40:46,188
yield components for insurers and endowments and pensions and understanding all of these concepts

507
00:40:46,188 --> 00:40:50,688
I mean, this has just been one of the most unique case studies to be a part of.

508
00:40:51,128 --> 00:40:54,188
And it just keeps evolving as they keep moving here.

509
00:40:54,708 --> 00:40:58,328
And it's getting to the point where it becomes so attractive for everyone to get into.

510
00:40:58,528 --> 00:41:14,248
You know, what Dan was saying with STRK, I think one of the coolest things about that product is, to me, it's one of the safest plays that you can take when you want to be directionally long micro strategy, but own a self-healing product.

511
00:41:14,248 --> 00:41:20,848
right so when you look at strk because it's got that call option embedded your net long micro

512
00:41:20,848 --> 00:41:28,988
strategy the common stock but if that price drives down that yield climbs up you find more buyers and

513
00:41:28,988 --> 00:41:34,488
it starts to self-heal on the price so your downside is so limited so if you buy that at the

514
00:41:34,488 --> 00:41:39,548
right time and you've seen what happens when it bounces around 80 and it starts to climb back up

515
00:41:39,548 --> 00:41:43,728
because the yield gets really attractive plus you're holding a call option so you can still be

516
00:41:43,728 --> 00:41:49,248
long the equity, but you can do it with much lower downside risk and much lower volatility.

517
00:41:49,248 --> 00:41:54,928
For a lot of people, that creates the perfect entry product to start to get familiar without

518
00:41:54,928 --> 00:41:59,248
having yourself shaken out two weeks in when you're down 40% for the first time.

519
00:41:59,248 --> 00:42:00,128
We've all been there.

520
00:42:02,448 --> 00:42:06,448
It's really opening the doors for all these new investors to come in.

521
00:42:06,848 --> 00:42:10,848
That includes institutional capital. It includes the retail investing public,

522
00:42:10,848 --> 00:42:17,588
which I think is hugely important to these types of companies. I think that when you have something

523
00:42:17,588 --> 00:42:25,188
this new and this complex, you need an engaged retail community that can do that education effort.

524
00:42:25,528 --> 00:42:30,888
It kind of becomes the marketing around what the strategy looks like and why all these products are

525
00:42:30,888 --> 00:42:34,388
going to be so important broader into the ecosystem, not just for retail investors,

526
00:42:34,388 --> 00:42:39,468
but why these are systemically important products that are getting launched and the different markets

527
00:42:39,468 --> 00:42:42,888
that they're proving out for all the other companies that are going to come next.

528
00:42:43,388 --> 00:42:46,108
This is a huge and steep learning curve.

529
00:42:46,588 --> 00:42:49,768
And you've never been able to get up to speed faster than you can now,

530
00:42:50,048 --> 00:42:51,128
which is just amazing.

531
00:42:52,728 --> 00:42:53,408
Oh, yeah.

532
00:42:53,588 --> 00:42:57,068
I mean, all of the AI stuff is just absolutely incredible.

533
00:42:57,148 --> 00:42:58,708
It's blowing me away, honestly.

534
00:42:58,708 --> 00:43:01,068
I just saw Adrian perk up.

535
00:43:01,288 --> 00:43:05,288
He needs to put Adrian AI Morris handle there instead.

536
00:43:05,288 --> 00:43:15,688
But yeah, AI has been incredible because it's going to disrupt so many what you used to think would kind of be like you thought there were a lot of companies with moats.

537
00:43:15,848 --> 00:43:22,248
You used to look at all the high tech companies and go, wow, the technology stack that they have has created such an amazing moat.

538
00:43:22,248 --> 00:43:47,968
But AI entering the system with really nimble entrepreneurs that can really scale quickly and light without all the overhead means a lot of these tech forward companies can get disrupted by people that can build the same functionality with half the overhead or an eighth of the overhead because they've got these accelerator tools that can get them moving faster.

539
00:43:47,968 --> 00:43:56,108
So like what we saw with Strive when they wrote their letter out to Intuit, talking about TurboTax and the potential for disruption there.

540
00:43:56,888 --> 00:43:59,808
You know, AI is going to come for companies you wouldn't expect them to come for.

541
00:44:00,068 --> 00:44:02,268
And I think we're just learning that now.

542
00:44:02,368 --> 00:44:07,548
It was always that automation and the machines were going to come and wipe out all the blue collar jobs.

543
00:44:07,608 --> 00:44:17,388
And now I'm looking at this going, you might want to pick up a skill because a lot of these tech jobs and a lot of the white collar jobs, you're seeing a much bigger impact there.

544
00:44:17,388 --> 00:44:20,588
I can't remember who it was. There was one executive, maybe it was even Sailor.

545
00:44:22,428 --> 00:44:26,708
No, it wasn't Sailor. I can't remember who, but there was one executive that said that before he'll

546
00:44:26,708 --> 00:44:32,188
even talk to his own legal counsel, they'll just go to ChatGPT and do a deep search. And it gets,

547
00:44:32,228 --> 00:44:36,728
you know, 99% of the way there on the answer. So you save yourself thousands and thousands of

548
00:44:36,728 --> 00:44:41,008
dollars of legal fees and research from these lawyers and you can get much closer and use your

549
00:44:41,008 --> 00:44:45,728
in-house counsel from there. Like that is a powerful tool. So all these professional services

550
00:44:45,728 --> 00:44:51,848
jobs that are charging five, six, seven, $800 an hour. Those are in trouble. I used to be a

551
00:44:51,848 --> 00:44:57,768
management consultant. I see why this is devastating for that industry. I mean, the days of delivering

552
00:44:57,768 --> 00:45:03,588
value through PowerPoints are over, right? If that's your business model, you better start

553
00:45:03,588 --> 00:45:09,648
rethinking that because AI is here. So pick up some Bitcoin. Well, along those lines, and I'm

554
00:45:09,648 --> 00:45:14,348
seeing the comments that people are like, to your point, Ben, about moats, strategy has the biggest

555
00:45:14,348 --> 00:45:19,368
mode for Bitcoin, right? That is their mode. And on the AI side, it's NVIDIA. And people like to say

556
00:45:19,368 --> 00:45:23,748
that, oh, someone could come for NVIDIA, but many of them don't understand about NVIDIA's mode and

557
00:45:23,748 --> 00:45:28,388
what CUDA is and on all of the different architecture plays that go into NVIDIA, it's

558
00:45:28,388 --> 00:45:35,168
not just GPUs. The reason why I bring that up is this. I'm still one of the people that thinks that

559
00:45:35,168 --> 00:45:39,888
strategy can scale their BI business for that very, very reason. AI is going to disrupt a lot.

560
00:45:39,888 --> 00:45:46,848
And in my day-to-day job, I use AI every single day for multiple hours a day.

561
00:45:47,068 --> 00:45:49,188
And I've used it to quadruple my output.

562
00:45:49,588 --> 00:45:50,828
First, I doubled it.

563
00:45:51,048 --> 00:45:51,788
Then I tripled it.

564
00:45:51,848 --> 00:45:52,688
Then I quadrupled it.

565
00:45:52,848 --> 00:45:54,108
I am coming into companies.

566
00:45:54,248 --> 00:45:55,068
I'm doing data work.

567
00:45:55,168 --> 00:45:56,788
I'm doing integrations work.

568
00:45:56,848 --> 00:45:58,048
I'm doing automation work.

569
00:45:58,048 --> 00:46:03,268
And I'm doing the work of like five or six people by myself because of all the tools that I've built.

570
00:46:03,428 --> 00:46:05,488
And I've built them out systematically, right?

571
00:46:05,488 --> 00:46:08,448
When GPT first came out, it sucked at coding.

572
00:46:08,688 --> 00:46:09,868
Then it got a little better.

573
00:46:09,888 --> 00:46:19,588
And now between GPT, between Claude, between Gemini, and there's all kinds of other tools.

574
00:46:19,688 --> 00:46:21,568
You have dedicated tools like Cursor.

575
00:46:21,848 --> 00:46:25,628
I've been able to weave in all kinds of automations into my workflow.

576
00:46:26,068 --> 00:46:31,248
That is why I think strategy has growth potential that's being underestimated on the BI side.

577
00:46:31,248 --> 00:46:40,088
because most of the work that exists right now in AI that still needs human ingenuity involves data,

578
00:46:40,248 --> 00:46:45,588
involves analytics, and involves integrating all of these together into actionable data,

579
00:46:45,588 --> 00:46:50,848
which is why Palantir blew up so quickly. It takes all of this disparate data, puts it together,

580
00:46:51,508 --> 00:46:56,568
and creates actionable data on top of it. Strategy has an opportunity to become, I think,

581
00:46:56,568 --> 00:47:00,848
business intelligence relevant if they really push this AI narrative and if they really,

582
00:47:00,948 --> 00:47:07,408
really scale it up. I think NVIDIA also is going to be a powerhouse. And I really want people to

583
00:47:07,408 --> 00:47:12,348
stop thinking about things in terms of an either or. If we look at the Bitcoin ecosystem,

584
00:47:13,288 --> 00:47:19,948
and if we think about Bitcoin as the base layer for a new equities market, it is not about strategy

585
00:47:19,948 --> 00:47:23,708
or similar or GME or whatever.

586
00:47:24,288 --> 00:47:26,188
The fact of the matter is Bitcoin's volatility

587
00:47:26,188 --> 00:47:27,508
is going to have these stocks ripping

588
00:47:27,508 --> 00:47:29,068
for different reasons at different times.

589
00:47:29,388 --> 00:47:31,688
And the idea is to get diversified

590
00:47:31,688 --> 00:47:32,988
without being diversified.

591
00:47:33,628 --> 00:47:35,308
Getting into these stocks at this point right now

592
00:47:35,308 --> 00:47:36,548
means you're exposed to Bitcoin.

593
00:47:37,308 --> 00:47:38,888
Everything else on top is cream.

594
00:47:39,708 --> 00:47:42,368
And you want exposure to as much of that cream as possible

595
00:47:42,368 --> 00:47:44,028
with all these different opportunities.

596
00:47:44,588 --> 00:47:46,968
So really stop thinking about things in terms of either or

597
00:47:46,968 --> 00:47:48,908
and start piecing it out and saying,

598
00:47:48,908 --> 00:47:52,668
what are your goals? If you want a dividend play and you don't want to play the options market

599
00:47:52,668 --> 00:47:57,288
yourself, you have iMist, you have Misty, you have other options. You can do strike. There's so many

600
00:47:57,288 --> 00:48:02,808
different ways you can play this thing. But just remember that the net thesis is exposure to Bitcoin

601
00:48:02,808 --> 00:48:07,708
and how can you play that volatility and how these different offerings allow you to play that

602
00:48:07,708 --> 00:48:13,128
volatility. Stop being so tribal about things. If you don't like Misty, don't buy it. If you don't

603
00:48:13,128 --> 00:48:18,428
like similar, don't buy it. If you don't want to be in GME, don't buy it. But don't be tribal about

604
00:48:18,428 --> 00:48:24,908
it don't take the bitcoin view and bring it to equity plays yeah yeah it's getting tribal right

605
00:48:24,908 --> 00:48:31,388
now we got the bitcoin only bears and like you know the no true bitcoin or fallacy if you know

606
00:48:31,388 --> 00:48:37,228
you're not bitcoin only you're not a true maxi um but there's a there's a good quote i like it says

607
00:48:37,228 --> 00:48:43,228
every time you spend money it's a vote for how you want the world to be and that's kind of the way

608
00:48:43,228 --> 00:48:48,148
way that I look at strategy. And in the future, you know, when everything is priced in Bitcoin,

609
00:48:49,288 --> 00:48:53,888
you're still going to have companies. And it was like Adrian said, you know, you, what are your

610
00:48:53,888 --> 00:49:07,282
goals What do you want the world to look like You want to invest in strategy which for me is a catalyst for you know turning the financial market into a Bitcoin based market And that the world that I want to live

611
00:49:07,282 --> 00:49:12,242
in. So that's why I invest in strategy. If you know, if your thing is, you know, the medical

612
00:49:12,242 --> 00:49:16,062
devices, you can go with similar, if your thing is like the mining industry, you can go with

613
00:49:16,062 --> 00:49:21,262
miners, you know, you can align your goals to what you think your money is worth spending on.

614
00:49:21,262 --> 00:49:29,682
And if they're based on Bitcoin, you can get, as Jeff Booth puts it, venture type returns on a venture type asset.

615
00:49:32,562 --> 00:49:33,002
Yeah.

616
00:49:34,302 --> 00:49:45,462
And Adrian, I think to your point, when you look at the BI business now, it used to be that a lot of the companies that they competed against that achieved such massive scale, they viewed that as an advantage.

617
00:49:45,602 --> 00:49:48,522
But I actually think of this new era we're in, it's going to be a disadvantage.

618
00:49:48,522 --> 00:50:18,502
You've got all this overhead and all this weight on your organization, where if you can take a company like MicroStrategy that just did a reinvention of themselves, clearly along the path of Bitcoin, if they get themselves back into that startup mindset that got them to the dance in the first place on the first round of building out the BI business, and they lean into AI and they really start hammering the BI business like a startup, they've got the right scale now where they're big enough to be wildly effective.

619
00:50:18,522 --> 00:50:24,462
effective, but they're small enough to still be scrappy and do it lean. And nimble. And nimble.

620
00:50:24,702 --> 00:50:29,042
And I think that's a massive advantage that people are overlooking. Now, is that their plan? I don't

621
00:50:29,042 --> 00:50:33,622
know. Right. I mean, obviously, Bitcoin is the primary focus of this business today. I don't

622
00:50:33,622 --> 00:50:39,602
think anyone thinks any differently, but it doesn't take away from the opportunity. And I don't think

623
00:50:39,602 --> 00:50:44,922
you abandon that type of business because you just got handed the perfect chance to reinvent.

624
00:50:44,922 --> 00:50:49,462
And if you reinvent effectively, watch out, right?

625
00:50:49,482 --> 00:50:52,122
Because there's a lot of markets now that are primed for disruption.

626
00:50:52,362 --> 00:50:55,442
Data and analytics has never been a bigger topic out there in the market.

627
00:50:55,682 --> 00:51:02,802
And you've never had the tools, if you've got an effective workforce that knows how to harness them, to allow you to ship faster than you can today.

628
00:51:03,622 --> 00:51:04,982
So, yeah, I'm with you.

629
00:51:05,082 --> 00:51:11,842
I'm not ruling that out as a possibility that we actually do see some excitement come back into the BI business here over the next 12 months.

630
00:51:12,702 --> 00:51:13,182
Totally.

631
00:51:14,122 --> 00:51:14,902
Go ahead.

632
00:51:14,922 --> 00:51:19,882
just on the bi component and working in reinsurance i used to have a fleet of people

633
00:51:19,882 --> 00:51:23,642
that worked on monte carlo simulations that's why i was so excited about these things i used to have

634
00:51:23,642 --> 00:51:28,202
to go to an actuary and say hey can you run this simulation for me like i need you to do you know

635
00:51:28,202 --> 00:51:33,082
xyz and he'd be like yeah cool i'll get it to you tomorrow and i'm like all right cool i'll wait and

636
00:51:33,082 --> 00:51:37,802
like actuaries get paid really well they just did monte carlo simulations and ran with numbers did

637
00:51:37,802 --> 00:51:43,882
all that stuff and boom here on a weekend i created my own monte carlo simulation did it in grok

638
00:51:43,882 --> 00:51:49,882
then i ran into grok and and had it create a whole python code for me to run my own monte

639
00:51:49,882 --> 00:51:56,922
carlo simulations customized did the whole thing did it in an hour i'm like oh my god this is this

640
00:51:56,922 --> 00:52:01,162
is just accelerating incredibly quickly so if you if you just have the people that understand how to

641
00:52:01,162 --> 00:52:06,122
communicate the code like communicate with the ai like that's where a lot of this value is going to

642
00:52:06,122 --> 00:52:13,322
be continuously kind of running uh running into well yeah the prompting is important but your

643
00:52:13,322 --> 00:52:18,302
are illustrating the one of the biggest points that I run into daily so everyone is focused on

644
00:52:18,302 --> 00:52:23,342
large language models but I think the modular models and the and the smaller application

645
00:52:23,342 --> 00:52:29,702
specific models are going to be where the rate the really big boom comes so just imagine in a future

646
00:52:29,702 --> 00:52:34,442
where someone is working with the system whether it's in the HR world are you doing something with

647
00:52:34,442 --> 00:52:38,222
Oracle or whether it's in the finance world are you doing something EBS or whatever system you're

648
00:52:38,222 --> 00:52:44,102
using and instead of them querying data, they're communicating with the system and they're

649
00:52:44,102 --> 00:52:48,422
asking it for specific instances where these specific criteria are met and the system is

650
00:52:48,422 --> 00:52:51,262
just giving them the data back without the need to query.

651
00:52:51,262 --> 00:52:55,782
To do that, to get to that point, you need to be able to work with the raw data on the

652
00:52:55,782 --> 00:53:01,442
backend in the system and clean it, structure it, and provide it with the right tokens and

653
00:53:01,442 --> 00:53:04,722
so on and so on and so forth to communicate with the AI system that's going to exist on

654
00:53:04,722 --> 00:53:05,962
top of it.

655
00:53:05,962 --> 00:53:08,202
That's where I think strategy can make hay.

656
00:53:08,222 --> 00:53:12,302
Most of the clients that I work with right now, they're making quantum leaps in systems.

657
00:53:12,422 --> 00:53:14,142
They're still on green screen on the back end.

658
00:53:14,782 --> 00:53:19,022
They're still on a lot of different systems that are very, very antiquated on the back end.

659
00:53:19,262 --> 00:53:24,102
And they need to be able to clean and manipulate the data to get it to a point where it's in these new systems.

660
00:53:24,322 --> 00:53:26,042
That's where business intelligence can live.

661
00:53:26,202 --> 00:53:27,582
And that's where strategy can make hay.

662
00:53:27,662 --> 00:53:31,082
And that's where I think a lot of the growth that we're going to see will come from.

663
00:53:31,162 --> 00:53:37,482
So I really think that people are underestimating the potential for strategies of business intelligence vertical.

664
00:53:37,482 --> 00:53:49,982
I think they have the opportunity to scale it here. I really, really do. I think it's going to take time. I definitely think Bitcoin is their focus. But for people calling for the death of their BI vertical in the next two years, I think that's premature. I really do.

665
00:53:50,342 --> 00:53:52,742
Bitcoin is the focus of like 10 people, right?

666
00:53:53,342 --> 00:53:53,782
Exactly.

667
00:53:54,002 --> 00:53:59,462
They've got another, you know, what, 1,300, 1,400 people to focus on the other stuff. So, yeah.

668
00:53:59,462 --> 00:54:06,202
that's a crazy statistic too just in and of itself right they raised they made 12 billion

669
00:54:06,202 --> 00:54:11,342
dollars last year on their bitcoin business and they've got a team of five or six people that are

670
00:54:11,342 --> 00:54:17,442
that are running it which is just totally incredible and it's it's going to be like that for

671
00:54:17,442 --> 00:54:22,602
you know the next four to eight years while companies are adopting this strategy and there

672
00:54:22,602 --> 00:54:27,422
are other entrants into the space and it gets a little bit more difficult but until then it's like

673
00:54:27,422 --> 00:54:31,902
you know foot on the gas and keep running the strategy until it doesn't make any sense anymore

674
00:54:31,902 --> 00:54:40,502
uh so late how's the uh speaking of competing against ai and bots and everything how's the uh

675
00:54:40,502 --> 00:54:48,662
msty now imst battle going yeah we got a uh a three-way battle going on now i went ahead and

676
00:54:48,662 --> 00:54:58,582
and took half the um half the assets and put put that into imst and um you know i got lucky versus

677
00:54:58,582 --> 00:55:03,862
them because the price went up 10 bucks a share right after that so i'm barely beating them like

678
00:55:03,862 --> 00:55:09,942
500 bucks but of course i'm still getting my booty kicked by uh msty because that's down 20

679
00:55:09,942 --> 00:55:18,742
percent since january so that's been a problem yeah so really it's wise down and you've got some

680
00:55:18,742 --> 00:55:24,662
leverage on your account right oh yeah yeah exactly and that's kind of the point so it's it's not

681
00:55:24,662 --> 00:55:30,342
necessarily that um the the covered calls that i sold had a problem it's what i've done with the

682
00:55:30,342 --> 00:55:35,222
premium that i collected with the covered calls because i've plowed it all into leverage and so

683
00:55:35,222 --> 00:55:41,002
So, you know, all of the Junes expired, you know, expired like 90% losses.

684
00:55:41,282 --> 00:55:43,842
All of the July's 90% losses.

685
00:55:44,522 --> 00:55:48,482
So now I'm holding my all my hopes lie in the September.

686
00:55:49,002 --> 00:55:50,842
So I'm keeping my fingers crossed for those.

687
00:55:51,882 --> 00:56:01,122
And I did a the title of my show the other day was number go up is coming, but it's right after your long calls expire worthless.

688
00:56:01,122 --> 00:56:11,142
and uh i think that's kind of a good point that that people need to um be ready for is that when

689
00:56:11,142 --> 00:56:16,642
you see people posting screenshots of all of their in the money calls that they bought you know a year

690
00:56:16,642 --> 00:56:23,382
and a half ago uh that's that that isn't necessarily going to be something that you can recreate in six

691
00:56:23,382 --> 00:56:30,382
months so you know just be you know have have reasonable expectations when you're buying something

692
00:56:30,382 --> 00:56:36,162
six months out, it isn't necessarily going to work out the same way when someone bought at the bottom

693
00:56:36,162 --> 00:56:43,142
of the bear market and they had a year and a half on their options. Yeah. Right. Yeah. It's a

694
00:56:43,142 --> 00:56:47,642
different environment. And it's interesting. I mean, you're doing the exact same thing that we're

695
00:56:47,642 --> 00:56:51,002
talking about with this orchestra, right? We're trying to create financial harmony for your

696
00:56:51,002 --> 00:56:59,522
portfolio, for your life. You've got some income products, you're going into leverage because that's

697
00:57:00,382 --> 00:57:04,762
make more money levered long and you've got a thesis on what that looks like. And,

698
00:57:04,802 --> 00:57:09,042
you know, that's not, everybody's going to be able to do that. Not everybody's going to be able to

699
00:57:09,042 --> 00:57:13,742
watch the charts, you know, sell covered calls all day. So it's a, now with the establishment

700
00:57:13,742 --> 00:57:20,582
of these products, like MSTY or IMST, you are employing Yieldmax or Jeff Park at Bitwise and

701
00:57:20,582 --> 00:57:25,062
the Bitwise team to, to do all of that work for you. Like that's what the expense ratio is for.

702
00:57:25,222 --> 00:57:29,562
It's like, they're sitting there sniping these trades or not. I think Yieldmax is a little bit

703
00:57:29,562 --> 00:57:38,382
more algorithmic. But it's interesting. And it'll be fascinating to see how those two products

704
00:57:38,382 --> 00:57:43,702
compare and contrast over time because YieldMax is much more close. They're at the money selling

705
00:57:43,702 --> 00:57:49,702
weeklies. Whereas I think iMist is a little bit, they're selling biweeklies or monthlies

706
00:57:49,702 --> 00:57:56,442
and further out of the money. And I think based on my understanding, it's the design of IMST is more

707
00:57:56,442 --> 00:58:02,422
towards protection of capital being long MSTR, whereas the design of Yieldmax is more

708
00:58:02,422 --> 00:58:09,982
income oriented, not necessarily as long MSTR. So everybody thinks they're the same. They're

709
00:58:09,982 --> 00:58:13,022
definitely not the same. They employ different strategies. They are different products.

710
00:58:13,262 --> 00:58:16,922
Fundamentally, they have different risk return metrics. We just don't know what they are and

711
00:58:16,922 --> 00:58:22,542
we can't compare them because the product is brand new. Yeah, exactly. And I think covered

712
00:58:22,542 --> 00:58:26,362
calls are all the rage, I guess, because everybody's like, man, I should have sold covered

713
00:58:26,362 --> 00:58:31,602
calls at 500. I should have sold covered calls at 450. You should have sold them at 400. You should

714
00:58:31,602 --> 00:58:36,582
have sold them at three. And it just sounds, it seems kind of like a, I don't know. It sounds

715
00:58:36,582 --> 00:58:41,462
like a bottom signal because that's like, if the market wants to cause max pain, it's like, okay,

716
00:58:41,462 --> 00:58:47,262
everybody gets driven into these covered calls. And then, you know, you start selling them right

717
00:58:47,262 --> 00:58:53,542
as the market goes up and then you, you know, you get your face ripped off. So yeah, know what

718
00:58:53,542 --> 00:58:58,882
you're getting yourself into when you're limiting upside, because if you saw what happened last

719
00:58:58,882 --> 00:59:04,802
March and in November, there's like, there's not a strike available in the entire options chain.

720
00:59:04,802 --> 00:59:10,962
That's going to save you from the price going up four X in, you know, eight weeks. So, right.

721
00:59:11,382 --> 00:59:15,082
Right. You know, you're going to get your face ripped off to some extent, regardless.

722
00:59:15,082 --> 00:59:21,862
us exactly yeah and I think I think it's a really good point and something I remember but like

723
00:59:21,862 --> 00:59:26,662
obviously it's the boy who cried wolf until it's not right I remember saying like we were talking

724
00:59:26,662 --> 00:59:31,282
about this in February I was big on it it's like oh everyone's short you know upside and it's gonna

725
00:59:31,282 --> 00:59:34,882
unwind you know we're sitting here April and like covered calls were would have still been a great

726
00:59:34,882 --> 00:59:43,462
trade but I think part of it is like I know sailor has that saying that markets make 80 of

727
00:59:43,462 --> 00:59:45,862
gains and 10 trading days out of the year.

728
00:59:46,102 --> 00:59:50,602
So that's kind of an interesting part is if you can time the other night, the

729
00:59:50,602 --> 00:59:55,282
other 350 days of the year and sell covered calls during those periods of time,

730
00:59:55,342 --> 00:59:58,802
you would be golden, but you have to look, you have to continue thinking very

731
00:59:58,802 --> 01:00:02,662
long-term and not get too confident covering all your shares and limiting

732
01:00:02,662 --> 01:00:07,242
all your upside because you don't, you can't time the market perfectly.

733
01:00:07,282 --> 01:00:08,642
So it's just something I think about a lot.

734
01:00:08,642 --> 01:00:12,602
And I think the covered call income generating is extremely, extremely

735
01:00:12,602 --> 01:00:16,762
useful and beneficial for a portion, right? But you're always going to want to leave some uncapped.

736
01:00:16,822 --> 01:00:20,462
And I know that's something, Ben, you've done historically is like you have to leave some

737
01:00:20,462 --> 01:00:25,062
upside for yourself as well. So it's a balance and a combination. And that's to Jeff's point

738
01:00:25,062 --> 01:00:30,922
is you have to create a portfolio that you're comfortable holding and meets your own needs.

739
01:00:30,922 --> 01:00:35,362
And the other thing on covered calls, I'd say is if, so there've been times where I've sold

740
01:00:35,362 --> 01:00:41,522
covered calls on too large a portion of my portfolio, you know, 70%, 80%, and I'll see

741
01:00:41,522 --> 01:00:46,322
them move against me and they can move against you very very quickly these short dated cover calls

742
01:00:46,322 --> 01:00:51,522
and if you're over exposed or over allocated to these covered calls you'll make a bad decision

743
01:00:51,522 --> 01:00:56,722
and so i've closed out covered calls for a loss when i shouldn't have and had just instead should

744
01:00:56,722 --> 01:01:01,042
have held them to expiration and it's cost me money because i had too many covered calls on so

745
01:01:01,042 --> 01:01:05,682
it's something to think about if you're if you're going out and harvesting absolutely go ahead jeff

746
01:01:05,682 --> 01:01:10,402
i i've absolutely done that as well i've been guilty of it and that's that's one of the reasons

747
01:01:10,402 --> 01:01:15,522
that some of these other products seem a little bit more appealing to me because the i don't want

748
01:01:15,522 --> 01:01:21,202
to handle the stress of having to watch it and make that decision right i mean so late you're

749
01:01:21,202 --> 01:01:27,842
400 episodes into your running your cover call strategy and doing the videos and i mean some of

750
01:01:27,842 --> 01:01:31,922
the best episodes are where you're you're scrambling you're like okay something's underwater

751
01:01:31,922 --> 01:01:38,242
gotta roll it gotta do something i gotta make a decision and you know i'm not a pro at that

752
01:01:38,242 --> 01:01:44,002
I'm not spending all of my time doing that because my time is better spent doing other things.

753
01:01:44,002 --> 01:01:49,282
Exactly. And it's tricky. Not everybody's going to be able to do that. So yeah, that's kind of

754
01:01:49,282 --> 01:01:56,962
where we're at in the evolution of this stuff. But it's definitely a good. A lot of people in the

755
01:01:56,962 --> 01:02:00,962
community and probably piss people off by saying this, I think there's guessing when it comes to

756
01:02:01,842 --> 01:02:07,282
playing cover calls and doing options. Because a lot of people are betting, they're essentially,

757
01:02:07,282 --> 01:02:11,522
i call it betting if you're if you're using all of your shares and cover calls week to week month

758
01:02:11,522 --> 01:02:16,322
to month you're essentially betting right you're hoping that you don't get called which you know

759
01:02:16,322 --> 01:02:21,602
you can be you can make money that way but you're you're not just limiting your upside in that

760
01:02:21,602 --> 01:02:26,322
instance you're severely limiting your upside if you only have a few hundred shares you should not

761
01:02:26,322 --> 01:02:30,722
be putting all of them into into an options contract rolling them week to week you should

762
01:02:30,722 --> 01:02:34,802
be taking 100 shares and seeing what you can get with that you should be taking your cost basis

763
01:02:34,802 --> 01:02:39,902
into account. You should be looking at all these different aspects of it. And I don't really see a

764
01:02:39,902 --> 01:02:43,922
lot of that going on in the community. I see a lot of people just thinking they're going to collect

765
01:02:43,922 --> 01:02:48,722
premium and they're just kind of gambling week to week to week. And a lot of people get blown up.

766
01:02:48,782 --> 01:02:52,142
And then you see them posting tweets saying that, oh, cover calls are the best strategy.

767
01:02:52,442 --> 01:02:56,722
You should be doing this X, Y, or Z, blah, blah, blah, blah, blah. So to Dan's point, you know,

768
01:02:56,742 --> 01:03:01,602
he's giving people very, very good advice here where he's gotten into situations where he lost

769
01:03:01,602 --> 01:03:05,842
money playing covered calls by being too cautious when he should have been more aggressive. And in

770
01:03:05,842 --> 01:03:08,802
other instances, he should have been more, he was too aggressive and he should have been more cautious.

771
01:03:09,062 --> 01:03:12,102
There's no way to call it, which is why you shouldn't put your whole stack up

772
01:03:12,102 --> 01:03:18,122
for grabs, week to week, contract to contract. That's just my view. And that's what I do with

773
01:03:18,122 --> 01:03:22,482
all of the different shares that I own. Yeah. It takes some finesse to be able to

774
01:03:22,482 --> 01:03:27,022
pull off covered calls. I think people jump into it too early and they just go pick the contracts

775
01:03:27,022 --> 01:03:30,562
that have, you know, what looks like a high premium to them where they feel good about

776
01:03:30,562 --> 01:03:35,022
collecting it, not realizing the amount of upside that they're giving up. You have to be a little

777
01:03:35,022 --> 01:03:42,042
tactical about it. And if you're not willing to be out there monitoring the IV and finding the

778
01:03:42,042 --> 01:03:46,242
right times where it actually makes sense to sell the covered calls, like the beauty of the

779
01:03:46,242 --> 01:03:53,342
volatility on micro strategy is that it's so unique in this equity that you don't have to

780
01:03:53,342 --> 01:04:01,822
be selling covered calls all the time. So I'll maybe sell covered calls 30% of the year, maybe,

781
01:04:02,242 --> 01:04:08,122
because I'll only do it during periods where that IV is already elevated. And that allows me to sell

782
01:04:08,122 --> 01:04:14,922
them much deeper out of the money, where if I do want to sell against a bigger portion of my holdings,

783
01:04:15,562 --> 01:04:20,962
at least I know I have a massive gain ahead of me before I potentially lose those shares.

784
01:04:20,962 --> 01:04:28,242
And if I lose those shares during a massively elevated volatility event, there's a good chance I'm getting them back at some point.

785
01:04:28,442 --> 01:04:40,462
Right. So you do have to, if you're going to run your own book and you're going to run your own covered call strategy, you do have to pay attention and know the mechanics behind what makes it a good time to sell them and when it isn't.

786
01:04:40,462 --> 01:04:45,322
Because if you try to force it and you start selling it during, you know, low volatility

787
01:04:45,322 --> 01:04:50,362
time periods and you start bringing it closer to the strike because you still want to get

788
01:04:50,362 --> 01:04:54,782
a high level of premium and you start, you know, taunting the world, right, with your

789
01:04:54,782 --> 01:04:56,562
shares and seeing if they'll come get them.

790
01:04:56,782 --> 01:05:01,282
One of those weeks, they're going to come get them and you're going to have no way of

791
01:05:01,282 --> 01:05:02,722
knowing when that's coming, right?

792
01:05:02,782 --> 01:05:08,162
Because it's going to be a Trump tweet or something that sends that market flying again.

793
01:05:08,162 --> 01:05:10,142
And all of a sudden you're out of your shares and it's,

794
01:05:10,462 --> 01:05:12,362
30% beyond where you lost them.

795
01:05:12,362 --> 01:05:14,262
And, you know, now you're upset about that.

796
01:05:14,262 --> 01:05:17,142
So you have to be really, really methodical

797
01:05:17,142 --> 01:05:18,302
about how you do this.

798
01:05:18,302 --> 01:05:20,582
And if you're not going to, then you outsource

799
01:05:20,616 --> 01:05:25,876
it to somebody else. I don't think that there's any real shame in going and picking up the products

800
01:05:25,876 --> 01:05:31,476
and letting the people that are getting paid the fees to manage this for you take over that role

801
01:05:31,476 --> 01:05:37,036
because you don't have the stress. You're not losing your shares as a part of that process.

802
01:05:37,036 --> 01:05:43,476
For most people, that probably makes sense. For those of us that like to stay engaged in the

803
01:05:43,476 --> 01:05:48,256
markets and really spend the time to learn, covered calls on MicroStrategy are an amazing

804
01:05:48,256 --> 01:05:53,696
product. It's the beautiful way to create income. So you just have to be tactical about it.

805
01:05:53,696 --> 01:05:59,936
Oh, and to that point, then it's just amazing how much money you can lose with one click.

806
01:06:00,656 --> 01:06:05,216
So it's just very important to take that into consideration. I've been like poof.

807
01:06:05,216 --> 01:06:07,376
And I've been like, and it's gone.

808
01:06:07,376 --> 01:06:08,096
And it's gone.

809
01:06:08,096 --> 01:06:13,616
What makes me laugh is you get so used to selling like covered calls on MicroStrategy,

810
01:06:13,616 --> 01:06:19,056
and then you go look at normal equities and like someone's holding 100 shares of amazon and they go

811
01:06:19,056 --> 01:06:23,776
look at selling covered call contracts and then go like three dollars out of the money

812
01:06:25,216 --> 01:06:31,056
you just become so desensitized to just how unique these leveraged bitcoin equities are for

813
01:06:31,056 --> 01:06:35,776
selling covered calls against them that uh you forget and sometimes you got to go look at these

814
01:06:35,776 --> 01:06:40,576
other stocks because they don't have that same volatility profile that is pretty unique to the

815
01:06:40,576 --> 01:06:46,896
the bitcoin equities and uh it resets your expectations it's tough to carve yourself away

816
01:06:46,896 --> 01:06:51,376
from that and even get excited about looking at any of those other equities because you know they're

817
01:06:51,376 --> 01:06:56,256
just not going to move yeah well strategy actually got me back into options because i got blown up in

818
01:06:56,256 --> 01:07:01,056
options back in back several years and i said to myself i'll never touch them again because i got

819
01:07:01,056 --> 01:07:10,016
back in i got lit on fire like with options years ago so um when when i started looking at the

820
01:07:10,016 --> 01:07:15,776
options with um strategy and i actually have to credit ben for this because he started whispering

821
01:07:15,776 --> 01:07:19,216
in my ear about certain things and i started looking at things a little bit differently

822
01:07:19,216 --> 01:07:25,136
now that's what that's what pulled me back in because um you know one the premium is just too

823
01:07:25,136 --> 01:07:28,496
good to pass up and two if you actually go into it with a plan you stick to that plan you don't

824
01:07:28,496 --> 01:07:32,976
deviate from that plan like my plan is very very boring i go out of the money with a certain stack

825
01:07:32,976 --> 01:07:37,536
of my shares i have my cost basis so i know that no matter what happens i'm going to get profit

826
01:07:37,536 --> 01:07:43,216
right but a lot of people just they just go in and gamble like i used to essentially and it's just

827
01:07:43,776 --> 01:07:48,656
there's just so many ways you can get burned um in this market especially with these bitcoin equities

828
01:07:48,656 --> 01:07:55,536
so um to the people watching i just say don't have an ego if if misty works for you if imis works for

829
01:07:55,536 --> 01:08:01,456
you just do that and be less stressed out for it there's nothing wrong with that yeah i had to make

830
01:08:01,456 --> 01:08:09,856
I had to get my hand off the mouse, right? Because otherwise, you log in and I used to be on the

831
01:08:09,856 --> 01:08:14,576
Soleil train for a long time doing it myself on doing all the weeklies all the time. And

832
01:08:15,856 --> 01:08:19,216
if you're selling them in like the first 30 minutes of the day, you don't have any idea

833
01:08:19,216 --> 01:08:23,296
what direction that market's going. That thing is going to whipsaw you and you might think you sold

834
01:08:23,296 --> 01:08:27,056
them at a great time. And then all of a sudden the market turns and goes the other direction on you.

835
01:08:27,056 --> 01:08:31,296
And now you're losing your mind wondering if you should just close these out right away and roll

836
01:08:31,296 --> 01:08:36,576
up like i had to get really mechanical and i run it with programs so i'm not doing it anymore but

837
01:08:36,576 --> 01:08:43,536
that's just because now i've got a very defined set of rules for when i will and won't sell covered

838
01:08:43,536 --> 01:08:48,656
calls and i don't have to worry about breaking that rule because it's not my hand on the mouse

839
01:08:48,656 --> 01:08:54,896
now clicking these trades it's all just automated and i've got a process that i follow and if there's

840
01:08:54,896 --> 01:08:58,896
no trade to be had there's no trade to be had so be it you know then you sit on the sidelines i

841
01:08:58,896 --> 01:09:03,776
I don't need to sell them every week. The premiums are too good. So I can just sit and wait.

842
01:09:03,956 --> 01:09:10,716
And then when it's really advantageous and when that IV is high and those premiums are really high, then you go collect some of it.

843
01:09:11,076 --> 01:09:19,616
So, yeah, it's a good point on the IV routine in a process and being able to watch it because a lot of people like to say, well, you can't time the market.

844
01:09:19,616 --> 01:09:24,756
Right. So just buy Bitcoin and hold it because you can't time the market. Just buy your strategy and can't time the market.

845
01:09:24,756 --> 01:09:30,896
that's completely fine if you're stacking stats or you're buying shares because you can go into a

846
01:09:30,896 --> 01:09:36,936
for 10 years and check your portfolio when you wake up right but if you're buying a call you are

847
01:09:36,936 --> 01:09:42,716
putting yourself on the clock you're basically admitting i'm about to try to time the market

848
01:09:42,716 --> 01:09:50,996
because you have until the expiration date of that contract you know to find an exit point

849
01:09:50,996 --> 01:10:04,416
And if you can't find one, like if you bought long calls anywhere between January and today, there wasn't a single exit point that you could have taken as the price was dropping 20, 30, 40 percent where you could have made money.

850
01:10:04,816 --> 01:10:14,856
So you had to have had a long enough expiration time and you have to be watching, you know, IV to see if you can find that that exit position.

851
01:10:14,856 --> 01:10:26,916
And, you know, oddly enough, the same high IV environment that is advantageous for selling to open a covered call, you know, everything in options is opposites.

852
01:10:27,536 --> 01:10:38,616
So it's also the same environment that you might, you know, not financial advice, but you might find that your window of opportunity to sell to close the long calls that you purchased.

853
01:10:38,616 --> 01:10:46,876
so um yeah if you're not gonna if you can't watch then then long calls are probably not

854
01:10:46,876 --> 01:10:51,136
going to be for you because you have to admit that you're going to have to time the market

855
01:10:51,136 --> 01:10:56,176
and um i don't think you have to necessarily treat you treat it like a day trading thing but

856
01:10:56,176 --> 01:11:00,936
you know you got to be checking it every day but i do think if you're going to do anything with

857
01:11:00,936 --> 01:11:08,456
options it's completely worthwhile to trade on both sides for a while right you should be

858
01:11:08,456 --> 01:11:14,856
selling covered calls because it teaches you when you find that they're overvalued right when those

859
01:11:14,856 --> 01:11:19,176
premiums are really high it starts to teach you that which gives you a better sense for when you

860
01:11:19,176 --> 01:11:26,296
look at the long calls that you're holding when's the right time to close because people forget that

861
01:11:26,296 --> 01:11:31,336
it's not always price that has to move to make those contracts more valuable sometimes you just

862
01:11:31,336 --> 01:11:37,016
get a spike in volatility and that's enough to really drive up the premiums on those and sometimes

863
01:11:37,016 --> 01:11:40,536
those are good times to get out of them because you can buy them back cheaper just if the volatility

864
01:11:40,536 --> 01:11:46,796
goes back down so understanding both sides of that and then it goes the other way right like if you're

865
01:11:46,796 --> 01:11:52,136
holding long options and you bought them in a high volatility environment and then you move into a

866
01:11:52,136 --> 01:11:58,276
low volatility environment you learn real fast how those premiums work and you realize why you would

867
01:11:58,276 --> 01:12:05,096
rather buy them during that really low volatility environment because they're so much cheaper so it

868
01:12:05,096 --> 01:12:10,456
It teaches you those little items that give you, I'm not necessarily going to say it gives

869
01:12:10,456 --> 01:12:17,196
you an edge, but it gives you an understanding of the mechanics behind these contracts.

870
01:12:18,156 --> 01:12:23,816
And if you really do start to understand that at a deep level and you can execute around

871
01:12:23,816 --> 01:12:27,756
that and not force yourself into trades and fear and that you're going to miss out on

872
01:12:27,756 --> 01:12:28,056
something.

873
01:12:28,116 --> 01:12:30,576
I mean, the whole design of this thing is that it's going to move like crazy.

874
01:12:30,676 --> 01:12:31,976
The volatility is going to pick up.

875
01:12:32,016 --> 01:12:32,936
It's going to slam down.

876
01:12:32,936 --> 01:12:37,836
but it teaches you the right times where you should even consider those types of trades

877
01:12:37,836 --> 01:12:42,036
because every day of the week is not the time for all those types of trades i mean

878
01:12:42,036 --> 01:12:48,956
options are one of those things that you can buy when the conditions are perfect right if you just

879
01:12:48,956 --> 01:12:55,116
get an iv crush the price has started consolidating down low you might look at going long on options

880
01:12:55,116 --> 01:13:00,016
but when that iv is really high it's probably time to stop buying those options you might want to be

881
01:13:00,016 --> 01:13:04,396
selling options, right? You might want to get out of the long ones and start selling them to somebody

882
01:13:04,396 --> 01:13:10,196
else who's buying them during the high volatility period. So those cycles and those mechanics behind

883
01:13:10,196 --> 01:13:14,016
that pricing is invaluable to learn if you're going to participate in that, because otherwise

884
01:13:14,016 --> 01:13:19,236
you're just guessing and you're going to be upset when you're wrong. And like we all did early on,

885
01:13:19,836 --> 01:13:24,176
that's when you get smashed. I mean, I'm not immune to it. I bought into a bunch of these

886
01:13:24,176 --> 01:13:28,396
stocks that were hyped up and I bought options thinking they were going to keep going another

887
01:13:28,396 --> 01:13:32,796
thousand percent you know nothing could stop them but i'm buying options when the volatility was

888
01:13:32,796 --> 01:13:36,876
really high and i was paying a fortune for them and then the price went down a little bit people

889
01:13:36,876 --> 01:13:41,596
got scared the volatility crushed and i just you know lost my ass right like that's that's how it

890
01:13:41,596 --> 01:13:46,316
happens you learn that lesson so if you could take the time to learn that up front you can save

891
01:13:46,316 --> 01:13:51,196
yourself a lot of pain and a lot of capital along the way it's a lot harder to get it back than it

892
01:13:51,196 --> 01:13:56,316
is to lose it yeah and one of the one of the really hard parts is there's so much data right like

893
01:13:56,316 --> 01:14:05,276
Like, IV is a great metric, implied volatility, but you have all of the different strike prices

894
01:14:05,276 --> 01:14:09,276
at all of the different horizons, and you have to have an understanding of probabilistic

895
01:14:09,276 --> 01:14:16,596
scenarios, delta, and you have to be able to conceptualize some of the mathematical framework

896
01:14:16,596 --> 01:14:20,776
with how it works as well in that entire model and function.

897
01:14:20,776 --> 01:14:40,296
And, you know, Dan, I know at the very beginning you were really interested in Black Shoals model, but I think it kind of breaks with some of the stuff. And there have been instances where some of the prices on the options market just didn't make any sense in either direction, which is tricky as well.

898
01:14:40,296 --> 01:14:46,936
so yeah i mean josh talks about that right he's like how do you how do you price a bitcoin option

899
01:14:46,936 --> 01:14:51,936
how do you price a three-year out option on bitcoin or bitcoin related equity it's like well

900
01:14:51,936 --> 01:14:59,656
you have this assumed kegger if you're a bitcoiner i mean the option can't be more expensive than the

901
01:14:59,656 --> 01:15:04,536
underlying itself like that that that was the whole point which is like the option can't be

902
01:15:04,536 --> 01:15:11,556
more expensive than actually buying the thing. So in that sense, you can't price a Bitcoin option,

903
01:15:11,856 --> 01:15:16,096
a long-term Bitcoin option properly. And that's kind of the arbitrage that I think a lot of us

904
01:15:16,096 --> 01:15:22,316
are trying to capture for long leaps. And something that Jeff and Ben have been successful at is

905
01:15:22,316 --> 01:15:27,376
those leaps are where you get the alpha. In the short term, a lot of algorithms are quite good

906
01:15:27,376 --> 01:15:31,876
at pricing the probability of a short-term move. But long-term, you're betting on something else.

907
01:15:31,876 --> 01:15:35,616
You're betting on a drift, not a historical volatility.

908
01:15:36,736 --> 01:15:44,976
And it's funny, too, because a lot of people will say, you know, strategy is the worst stock to do covered calls against because you don't want to limit your upside.

909
01:15:46,056 --> 01:15:49,716
And while that, you know, that could actually be true.

910
01:15:49,916 --> 01:15:50,816
It is true.

911
01:15:50,956 --> 01:15:52,416
It was true in March and it was true in November.

912
01:15:52,416 --> 01:16:09,716
But I think there's actually like an even more important use case for covered calls, which makes strategy less suitable is more so selling covered calls or selling cash secured puts reduces your cost basis.

913
01:16:09,716 --> 01:16:20,736
and when you suck at picking stocks, reducing your cost basis can turn you from a shitty trader

914
01:16:20,736 --> 01:16:24,896
to a decent trader or from a decent trader to an above average trader, right?

915
01:16:25,716 --> 01:16:31,996
And so you're basically trading the unlimited upside for a greater chance of success.

916
01:16:31,996 --> 01:16:38,976
And that's important for people who are maybe a little bit, not necessarily expert traders.

917
01:16:39,716 --> 01:16:52,536
But when you're dealing with something like Bitcoin, which is going up forever, Laura, then you're not really, you know, you don't need to lower your cost basis for a greater chance of success because you know what it's going to do.

918
01:16:52,796 --> 01:16:58,156
You know, it might not happen in six months, but, you know, in four years, no one has ever lost money in Bitcoin.

919
01:16:58,916 --> 01:17:01,776
So if Bitcoin is going up, then that means strategy is going up.

920
01:17:01,776 --> 01:17:06,756
and so the kind of the greatest use case for selling covered calls is to reduce that cost

921
01:17:06,756 --> 01:17:11,136
basis and give yourself a greater chance of success but you kind of don't need it

922
01:17:11,136 --> 01:17:17,776
you kind of don't need it with strategy so i i know it's kind of all the rage uh lately and even

923
01:17:17,776 --> 01:17:23,056
matthew cratter of bitcoin university he had he did covered calls today when i was on his day

924
01:17:23,056 --> 01:17:29,056
so it was like um you know i followed him back when he was trader university you know before he

925
01:17:29,056 --> 01:17:36,896
was orange-pilled. And so he had all of the TradFi stock market trading strategies. That was his

926
01:17:36,896 --> 01:17:43,296
thing before he moved over to Bitcoin only. And even he covered it because I guess it's just

927
01:17:43,296 --> 01:17:51,296
everybody's talking about it. But strategy really just doesn't need it. But if you can be a sniper,

928
01:17:51,476 --> 01:17:57,256
like Ben was talking about, you find those once or twice a year, you find the high IV environment,

929
01:17:57,256 --> 01:18:00,536
and you can do it like a sniper maybe,

930
01:18:00,656 --> 01:18:05,516
I think that's probably most people's best case

931
01:18:05,516 --> 01:18:07,916
to enter into some of those positions.

932
01:18:08,556 --> 01:18:10,396
It's hard to even identify that.

933
01:18:10,736 --> 01:18:12,376
I mean, you know it when you see it

934
01:18:12,376 --> 01:18:14,816
after you've been watching this stock for a long time,

935
01:18:14,816 --> 01:18:18,236
but there's always that voice in the back of your head going,

936
01:18:18,736 --> 01:18:19,396
but what if?

937
01:18:19,476 --> 01:18:20,276
What if it's different?

938
01:18:20,456 --> 01:18:21,776
You just throw it up into the right, you know?

939
01:18:22,136 --> 01:18:23,276
What if IV goes to 400?

940
01:18:23,956 --> 01:18:24,676
Yeah, yeah.

941
01:18:24,676 --> 01:18:29,316
like what you were saying where you know a lot of people would say that mstr might be you know one

942
01:18:29,316 --> 01:18:34,676
of the worst things to sell covered calls on i probably would have been in that camp for a while

943
01:18:35,556 --> 01:18:40,276
until i watched enough cycles play out where you understand that the design of this is we're going

944
01:18:40,276 --> 01:18:46,436
to get wild runs up and we're going to get wild drawdowns and that is that volatility in action

945
01:18:47,316 --> 01:18:53,076
so at this point you know as long as i wasn't selling them you know really close to the money

946
01:18:53,076 --> 01:18:55,096
in this long downtrend, right?

947
01:18:55,096 --> 01:18:56,436
As long as I wasn't doing that,

948
01:18:57,436 --> 01:19:08,864
I would be at peace if I was selling these at you know 15 Delta 10 Delta something like that and they got taken from me and I had to sit on the sidelines for a while because I watched

949
01:19:08,864 --> 01:19:14,524
the design play out long enough now that I would feel there was a pretty decent chance that I'd

950
01:19:14,524 --> 01:19:19,644
get another good entry point. If you look at last year, there were about five of these cycles

951
01:19:19,644 --> 01:19:24,664
where you got these massive run-ups and then these massive drawdowns, right? It's the design.

952
01:19:24,664 --> 01:19:29,464
Nothing's going to go up and to the right, particularly not something that's thriving on volatility and sentiment.

953
01:19:30,444 --> 01:19:33,804
I mean, you look at that MNAV expansion, that's a sentiment indicator.

954
01:19:34,224 --> 01:19:38,424
If people are feeling real bulled up about Bitcoin, that thing expands really fast.

955
01:19:38,564 --> 01:19:41,624
And when they start getting nervous again, it contracts really fast.

956
01:19:42,404 --> 01:19:47,264
And you just see that at play on this stock like you haven't seen on any other stock.

957
01:19:47,424 --> 01:19:52,324
So I think it would bother me less at this point than it would have before.

958
01:19:52,324 --> 01:19:55,924
because while I understand the long-term opportunity

959
01:19:55,924 --> 01:19:57,304
and I think that you're just going to see

960
01:19:57,304 --> 01:19:58,384
this constant growth,

961
01:19:58,564 --> 01:20:00,204
it's not going to be a straight line.

962
01:20:00,524 --> 01:20:01,944
The whole design would prevent this

963
01:20:01,944 --> 01:20:03,724
from being a straight line up into the right.

964
01:20:03,964 --> 01:20:05,104
You're going to have these cycles.

965
01:20:05,104 --> 01:20:07,884
So, you know, all is not lost

966
01:20:07,884 --> 01:20:10,044
in the event that you did take a swing

967
01:20:10,044 --> 01:20:11,124
and you lost some shares,

968
01:20:11,124 --> 01:20:13,344
but you got to be disciplined enough

969
01:20:13,344 --> 01:20:16,364
to think there's a chance I got to sit on the side

970
01:20:16,364 --> 01:20:18,264
and maybe one of these times

971
01:20:18,264 --> 01:20:20,004
that little voice in the back of your head will be right

972
01:20:20,004 --> 01:20:21,684
and it will just keep going straight up

973
01:20:21,684 --> 01:20:23,564
and stovepipe into the sky.

974
01:20:23,824 --> 01:20:25,964
But yeah, I don't know.

975
01:20:26,064 --> 01:20:27,904
It doesn't bother me as much as it used to.

976
01:20:28,244 --> 01:20:29,664
I used to have major FOMO

977
01:20:29,664 --> 01:20:31,464
every time I would sell an options contract

978
01:20:31,464 --> 01:20:33,524
thinking that I just totally gave up on the trade

979
01:20:33,524 --> 01:20:35,484
until it settled worthless.

980
01:20:35,724 --> 01:20:36,824
Then I'd feel better again.

981
01:20:36,964 --> 01:20:38,444
But now I don't feel quite that way.

982
01:20:39,524 --> 01:20:40,284
Yeah, and I should clarify,

983
01:20:40,604 --> 01:20:42,044
I think Bitcoin University covered it

984
01:20:42,044 --> 01:20:44,144
because he was probably getting a lot of questions about it.

985
01:20:44,624 --> 01:20:46,244
But yeah, he was sour on it.

986
01:20:46,244 --> 01:20:47,704
He was like, no, I don't think it's,

987
01:20:48,004 --> 01:20:49,004
I think it's suboptimal,

988
01:20:49,424 --> 01:20:50,984
selling covered calls against it.

989
01:20:50,984 --> 01:20:53,924
So that was his official opinion on it.

990
01:20:58,044 --> 01:20:58,764
All right.

991
01:20:59,444 --> 01:21:01,064
So I want to shift gears.

992
01:21:01,284 --> 01:21:02,244
You want to shift gears?

993
01:21:02,484 --> 01:21:03,864
Yeah, shift gears here for a second.

994
01:21:03,864 --> 01:21:08,544
So I happened to catch I was on a space right before this.

995
01:21:09,004 --> 01:21:12,044
And so we just spent a lot of time talking about options and covered calls.

996
01:21:12,424 --> 01:21:14,724
And what that does is is trying to play the volatility.

997
01:21:15,404 --> 01:21:20,684
So I think what happened was the space I was just on, Grant Cardone was on.

998
01:21:20,984 --> 01:21:23,644
And Grant Cardone was talking about real estate.

999
01:21:24,364 --> 01:21:26,524
You know, like, what the hell does real estate have to do with Bitcoin?

1000
01:21:27,124 --> 01:21:32,304
What he was saying was, was that he started a new fund to buy buildings.

1001
01:21:32,964 --> 01:21:39,844
And one of the things that he did with it is that as their cash flow comes in, he buys Bitcoin with it.

1002
01:21:39,924 --> 01:21:41,844
I was completely unaware that he was doing this.

1003
01:21:42,084 --> 01:21:46,844
And what happened was three investors came to him.

1004
01:21:47,784 --> 01:21:50,644
And they never invested before at Grant Cardone.

1005
01:21:50,644 --> 01:21:56,844
They never invested in real estate. And they wrote a check of 25, 15 and 10 million.

1006
01:21:57,164 --> 01:22:02,664
So he picked up 50 million dollars in investors. And so he asked all three of these people, why are you investing in me?

1007
01:22:03,004 --> 01:22:11,804
And basically, the three people said to the effect that Grant, I will I will what he called center this a bit.

1008
01:22:11,844 --> 01:22:15,884
He said, basically, real estate is so boring as crap.

1009
01:22:15,884 --> 01:22:19,404
But he used some more adjectives that we would never invest in real estate.

1010
01:22:19,404 --> 01:22:26,944
But now because you have real estate and it's generating cash flow and you will reinvest that into Bitcoin, we think it's really interesting.

1011
01:22:27,244 --> 01:22:29,064
And they gave him money to go do this now.

1012
01:22:30,064 --> 01:22:33,504
And so then he has a checkbox and the investors have a choice.

1013
01:22:33,924 --> 01:22:38,084
They can either receive a yield monthly and they have two choices.

1014
01:22:38,604 --> 01:22:42,244
It will either be paid out in all cash or be paid in Bitcoin.

1015
01:22:42,904 --> 01:22:46,284
And if they don't actually want the yield, then they'll get more of it.

1016
01:22:46,284 --> 01:22:59,624
And so what happened is, is that a business that was boring is now attracting people to invest in it because there's Bitcoin, not necessarily on the balance sheet, but part of this fund that does it.

1017
01:22:59,824 --> 01:23:02,744
And so that completely changed the dynamics of it.

1018
01:23:03,244 --> 01:23:09,204
So what I'm going to say is this, is that there are people that look at fundamentals and then there are people look at technical analysis.

1019
01:23:09,204 --> 01:23:21,704
And what's happening here is that if there's a problem with you don't like the way politics are or tariffs are, what can you add to your company balance sheet that will give this potential upside?

1020
01:23:22,184 --> 01:23:31,064
And if you have that potential upside in your stock and it's publicly traded, then you may have a vibrant option market that's on it.

1021
01:23:31,284 --> 01:23:36,884
And then all of a sudden now there's volatility in your stock that you never had before just because you added Bitcoin to it.

1022
01:23:36,884 --> 01:23:44,664
So if you're looking for some form of good news and you're a publicly traded company, obviously, Saylor's been talking about this now for almost a half a decade.

1023
01:23:45,044 --> 01:23:52,664
But now we're starting to see this drift over into other areas in so-called boring real estate, which has a low cap rate.

1024
01:23:52,764 --> 01:23:56,844
Let's say it gets under 10%. Let's say if it's even great, it gets 15% a year.

1025
01:23:57,384 --> 01:24:04,884
Heck, we could just buy some of the products that we talked about that'll get close to that and we don't have to worry about anything related to real estate.

1026
01:24:05,364 --> 01:24:09,844
So that's the difference that we're seeing here. We talked about options now for 20 minutes,

1027
01:24:10,324 --> 01:24:13,924
but the reason why people are interested in options is because of the volatility

1028
01:24:14,964 --> 01:24:20,324
and attracting new investors to go into it. And I think that's something different to look at.

1029
01:24:21,924 --> 01:24:26,404
Yeah. And I bring up this screen here just to show it again. This is from Jesse Myers.

1030
01:24:26,404 --> 01:24:32,004
And we focused a lot this last 45 minutes on this equity market, right? And how we're seeing this

1031
01:24:32,004 --> 01:24:36,484
yield developing and evolving in the equity market and grain you hit on this real estate market

1032
01:24:37,764 --> 01:24:42,884
what the exact same thing that's happening in the uh public equity market where you're you know

1033
01:24:42,884 --> 01:24:49,044
monetizing the volatility and figuring out ways to like get yield off of bitcoin the whole world

1034
01:24:49,044 --> 01:24:53,764
is also trying to figure out how to do it on real estate and bonds and in different ways in different

1035
01:24:53,764 --> 01:24:59,284
formats in the private credit world as well and so we're seeing this on as you mentioned the

1036
01:24:59,284 --> 01:25:03,584
the development of these businesses that are restructuring, right? Like they're adding

1037
01:25:03,584 --> 01:25:08,424
structured finance connected to real estate that you've got a piece of Bitcoin connected to it,

1038
01:25:08,464 --> 01:25:15,044
whether it be Bitcoin attached to a mortgage or a Bitcoin plus home line of credit or,

1039
01:25:15,044 --> 01:25:21,944
you know, certain types of wrapped products as you've outlined here. So these are huge capital

1040
01:25:21,944 --> 01:25:26,524
pools that people are tapping. And it's the evolution that we're seeing in the equity market

1041
01:25:26,524 --> 01:25:29,964
is happening in all of these other private credit markets as well. And it's happening

1042
01:25:30,844 --> 01:25:35,244
like behind the scenes. Not a lot of people hear about it, but this is some of the feedback we've

1043
01:25:35,244 --> 01:25:41,724
heard at Bitcoin Investor Week. And if you're really plugged into some of the business that's

1044
01:25:41,724 --> 01:25:48,044
happening, like the Bitcoin Reserve Summit that happened yesterday, the Bitcoin Reserve Summit

1045
01:25:48,044 --> 01:25:51,004
that happened yesterday, there were many conversations of some of the stuff that's

1046
01:25:51,004 --> 01:25:56,284
happening behind the scenes in the private credit ecosystem related to Bitcoin as well.

1047
01:25:56,524 --> 01:26:12,764
I think that's the fundamental shift. And I think the niche area that we're in here at MSDR True North is companies that have Bitcoin on the balance sheet. And I think that's the part where we're seeing all the products that come up.

1048
01:26:12,764 --> 01:26:39,804
You know, single company ETFs, in essence, made no sense five years ago or seven years, whenever they started to come out. But now you have all these levered ETFs on strategy and other companies, Tesla, and so forth, that the marketplace has fundamentally changed. So we're seeing the financialization of the market to get greater and greater leverage on a few concentrated bets. And I think that's a really interesting place where we're going.

1049
01:26:39,804 --> 01:26:44,764
And so I think from my perspective, somebody mentioned GameStop.

1050
01:26:44,904 --> 01:26:48,444
It's just a matter of time before GameStop announces their purchase.

1051
01:26:48,904 --> 01:26:56,304
It's another lever in order to give additional volatility to that stock that has plenty of options on it already.

1052
01:26:56,444 --> 01:27:03,344
That's the original meme stock that people jump back into now because they're excited that there's this new lever that they bought Bitcoin.

1053
01:27:03,824 --> 01:27:08,084
And then they know in many cases what happened with strategy.

1054
01:27:08,084 --> 01:27:11,024
And I don't think that's a far leap to see that happening.

1055
01:27:11,544 --> 01:27:15,104
So I'm really excited about it, the option market.

1056
01:27:15,964 --> 01:27:21,664
And the other thing I'll say about the options is you can be short-term bearish, long-term bullish.

1057
01:27:22,024 --> 01:27:27,564
No reason why you can't have a short-term positions with shorter expirations.

1058
01:27:27,784 --> 01:27:30,944
And then you have leaps that go out where you're long-term bullish.

1059
01:27:31,304 --> 01:27:35,044
I don't know why many people think it's either everything or nothing.

1060
01:27:35,404 --> 01:27:37,044
You can have multiple positions.

1061
01:27:37,044 --> 01:27:38,804
And I think that's great.

1062
01:27:39,284 --> 01:27:42,904
That's Josh Mandel monetizing everything on all of these different horizons.

1063
01:27:42,904 --> 01:27:46,064
When he shows his portfolio and it's like, okay, I've got all of these different positions

1064
01:27:46,064 --> 01:27:48,464
and they're all in the green, but they're all going different directions.

1065
01:27:49,224 --> 01:27:52,004
That's one of those like, damn it, Josh, you're right again.

1066
01:27:52,824 --> 01:27:57,224
It's like short and long and they're both green and they're both on different horizons.

1067
01:27:57,404 --> 01:27:58,204
Yeah, I don't know.

1068
01:27:59,284 --> 01:28:00,744
All right, later guys, I got to drop.

1069
01:28:00,964 --> 01:28:01,644
All right, later, Adrian.

1070
01:28:01,764 --> 01:28:02,144
Catch you.

1071
01:28:02,144 --> 01:28:02,504
Yeah, Adrian.

1072
01:28:04,184 --> 01:28:06,024
Shall we use the word decoupling?

1073
01:28:06,024 --> 01:28:11,624
Should we talk about decoupling a little bit or are we going to get shunned by the community?

1074
01:28:13,624 --> 01:28:18,804
I think the decoupling sound, and heck, I've been waiting for that for seven years.

1075
01:28:19,284 --> 01:28:22,884
A lot of people, oh man, I wish I could make this bigger.

1076
01:28:23,384 --> 01:28:24,204
But what this is.

1077
01:28:24,724 --> 01:28:25,584
I like the word floor.

1078
01:28:25,824 --> 01:28:26,944
I like the word floor.

1079
01:28:29,104 --> 01:28:33,244
Yeah, I think Bitcoin's acting more as a floor instead of decoupling these days.

1080
01:28:33,244 --> 01:28:39,424
There seems to be a floor on the Bitcoin price relative to the equities market, but it doesn't seem to be performing in a decoupled manner.

1081
01:28:39,604 --> 01:28:42,104
Yeah, it's not going opposite. It's just got a floor.

1082
01:28:43,804 --> 01:28:46,304
Yeah, exactly. But that's just my two cents continue.

1083
01:28:46,504 --> 01:28:51,144
Well, this is the price of micro strategy or strategy over the last month.

1084
01:28:51,544 --> 01:28:55,164
So strategy over the last month is up 8.77%.

1085
01:28:55,164 --> 01:28:58,544
Meanwhile, S&P 500 is down 7.

1086
01:28:58,964 --> 01:29:00,064
QQQ is down 7.

1087
01:29:00,164 --> 01:29:01,024
Apple is down 9.

1088
01:29:01,124 --> 01:29:02,144
Amazon down 11.

1089
01:29:03,244 --> 01:29:22,104
And I think it's a fascinating perspective. Huge delta there, right? I mean, it's 15 point delta or greater on these assets. And if you were to tell people five years ago that this scenario would happen, they wouldn't believe you.

1090
01:29:22,104 --> 01:29:32,844
A company that's holding more Bitcoin on their balance sheet than anybody else is moving the opposite direction of the MAG-7 and the MAG-7 is down 7% in the last month.

1091
01:29:33,804 --> 01:29:36,804
People would just not believe with Trump as president.

1092
01:29:37,724 --> 01:29:38,824
People wouldn't believe you.

1093
01:29:39,264 --> 01:29:42,144
So I think it's a really interesting data point.

1094
01:29:42,304 --> 01:29:48,944
And this is starting to create and form this narrative that's being carried around the rest of the market.

1095
01:29:48,944 --> 01:29:57,424
right? You're starting to see this alternative movement that's creating a different risk return

1096
01:29:58,064 --> 01:30:06,704
reward that should be added to a portfolio. What's your guys' general thought on the broader market?

1097
01:30:06,704 --> 01:30:09,024
We could talk about tariffs a little bit. We could talk about

1098
01:30:09,824 --> 01:30:14,944
Powell and what's going on here, but I think we get into this space a little bit.

1099
01:30:14,944 --> 01:30:22,144
Yeah, I mean, I would talk COVID comparisons here. And I think like an interesting

1100
01:30:22,144 --> 01:30:30,624
statistic is the targeted federal funds rate going into COVID was like between 1.5 and 1.75%.

1101
01:30:31,664 --> 01:30:38,304
Whereas right now, we're at like a 4.2, 4.5 target federal funds rate. So the environments

1102
01:30:38,304 --> 01:30:43,424
are much different and there's almost more to unroll. There's more liquidity to inject

1103
01:30:43,424 --> 01:30:47,784
where we're sitting now versus what occurred during COVID.

1104
01:30:48,364 --> 01:30:54,504
And then, you know, you look at the stimulus packages that were offered throughout COVID.

1105
01:30:54,504 --> 01:30:59,804
I mean, you know, it started with a March 3rd emergency 50 basis point cut,

1106
01:31:00,044 --> 01:31:06,024
and then it further went into cutting to 0% over the course of the next three months.

1107
01:31:06,544 --> 01:31:11,824
And, you know, a $2 trillion stimulus package on March 27th during 2020.

1108
01:31:11,824 --> 01:31:30,364
So drastic measures were put in place very, very quickly. And I think I'm not saying that's going to happen necessarily now, but there's just a ton of runway here for this whole thing to unroll. And obviously, Bitcoin is just a vacuum for that sort of liquidity. And, you know, I was kind of a cycles power law guy until I see where we're sitting now.

1109
01:31:30,364 --> 01:31:48,304
And I mean, it would be very, very difficult to be bearish here. It's just like we've hit what I believe to be an adoption floor. We've decoupled during or we've hit a floor during a incredibly kind of bearish time and risk assets. And we're looking at liquidity just, you know, lining up right down the middle. So I think things look pretty good.

1110
01:31:48,304 --> 01:31:52,964
the best is my answer. Well, I'm going to run through my stats that we talked about on the

1111
01:31:52,964 --> 01:31:59,924
hurdle rate, Jeff, in periods of time. I found this to be really interesting. So last Wednesday,

1112
01:32:00,724 --> 01:32:06,204
the S&P was up nine and a half percent. That was the 10th biggest market day in history,

1113
01:32:06,204 --> 01:32:13,704
the one day. Before that, number one was 16% in 1933 during the Great Depression.

1114
01:32:13,704 --> 01:32:18,444
The second best day was 1929, also during the Great Depression.

1115
01:32:18,904 --> 01:32:20,884
Third best day, Great Depression.

1116
01:32:21,584 --> 01:32:27,244
Fourth best day was the first trading day after Germany invaded Poland, the start of World War II.

1117
01:32:28,164 --> 01:32:29,544
Fifth, Great Depression.

1118
01:32:30,024 --> 01:32:32,364
Sixth, Global Financial Crisis in 08.

1119
01:32:32,564 --> 01:32:34,864
Seventh, Global Financial Crisis in 08.

1120
01:32:35,184 --> 01:32:36,224
Eighth, Great Depression.

1121
01:32:36,544 --> 01:32:37,584
Ninth, Great Depression.

1122
01:32:38,244 --> 01:32:50,172
Then last Wednesday The next 20 best performing market days were during COVID the 1987 crash or they were in recession and depression periods

1123
01:32:50,692 --> 01:32:55,952
So I found it really interesting because we get these big rally days like we saw last Wednesday.

1124
01:32:56,812 --> 01:33:05,052
And it typically instinctually makes you think that we've turned and the market's automatically going to go up right away.

1125
01:33:05,052 --> 01:33:12,432
and that surprised me to see all of those events being during those types of periods

1126
01:33:12,432 --> 01:33:18,372
and i think the reason is because people go risk off pretty quickly and it drains all the liquidity

1127
01:33:18,372 --> 01:33:24,652
out of the market and the markets are looking for any type of good news and that market just moves

1128
01:33:24,652 --> 01:33:29,192
because there's not enough liquidity in it so any good news brings capital rushing in one direction

1129
01:33:29,192 --> 01:33:35,032
and particularly of interest because of what dan just said about the liquidity that's probably

1130
01:33:35,032 --> 01:33:40,532
going to enter the market was the 08 both of those were on news about government intervention

1131
01:33:40,532 --> 01:33:47,512
or central bank intervention was what made those days happen so it is interesting when you look

1132
01:33:47,512 --> 01:33:52,352
back in history what those time periods looked like and the other thing they all had in common

1133
01:33:52,352 --> 01:33:57,172
was the markets were about flat for the next three months and then it varies widely they go

1134
01:33:57,172 --> 01:34:01,892
all different directions after about three months. But during those time periods, particularly in the

1135
01:34:01,892 --> 01:34:07,532
top 10, the markets went flat for about 30 days. Now, I'm not saying that that's what's going to

1136
01:34:07,532 --> 01:34:11,812
happen here, but I just found it to be really interesting because our sentiment swings so

1137
01:34:11,812 --> 01:34:16,312
quickly all the time. We think it's coming right away and they're going to stimulate everything

1138
01:34:16,312 --> 01:34:19,452
and all the equities are going to rip and all the risk assets are going to rip.

1139
01:34:20,352 --> 01:34:25,992
And I don't know yet. I'm not totally sold that we're fully on the other side of this. I think

1140
01:34:25,992 --> 01:34:31,272
all the news is starting to come in good around the tariff discussions because I think they hit

1141
01:34:31,272 --> 01:34:36,232
us with worst case first, which I think was actually a pretty good move when they did all

1142
01:34:36,232 --> 01:34:40,652
the reciprocal tariffs and everyone was looking at these really massive tariffs broadly across the

1143
01:34:40,652 --> 01:34:45,612
board on products. And then they started pairing those back. So we kind of got hit with the worst

1144
01:34:45,612 --> 01:34:51,472
case scenario. And now it seems like everybody's working their way into settling the trade issues

1145
01:34:51,472 --> 01:34:57,172
with the US except China. And it's pretty clear that we've entered a trade war with China. And it

1146
01:34:57,172 --> 01:35:01,412
might actually be a currency war with China. We'll see how that all plays out here at the end. But

1147
01:35:01,412 --> 01:35:05,332
we're still in an interesting time. And I'm not quite sure that from a market's perspective,

1148
01:35:05,332 --> 01:35:10,912
we're out of the woods yet. But I do think that Bitcoin looks better than equities at the moment

1149
01:35:10,912 --> 01:35:16,452
because of what's on the horizon. So we'll see what happens ultimately. But I just found that

1150
01:35:16,452 --> 01:35:22,352
to be pretty interesting that all those best performing days were all during very bad economic

1151
01:35:22,352 --> 01:35:31,132
times. Totally agree with that, Ben. And I think before we heard the term, going back two years

1152
01:35:31,132 --> 01:35:36,252
ago, will Powell be able to get a soft landing? We heard that, oh, there's going to be a recession,

1153
01:35:36,352 --> 01:35:42,472
there's going to be a recession. The S&P 500, Bitcoin, everything rips over two years with

1154
01:35:42,472 --> 01:35:48,972
this constant narrative. And now all this, now the market dips due to tariffs, like, oh,

1155
01:35:48,992 --> 01:35:53,752
the market's now dumping and all the stats that you just said happened. Well, now a recession is

1156
01:35:53,752 --> 01:36:00,192
inevitable. And it's like, folks, if you wait four years to hit a, you know, to hit a recession

1157
01:36:00,192 --> 01:36:05,752
and you stay in cash, you didn't make any of the upside at all. So that doesn't make a lot of sense

1158
01:36:05,752 --> 01:36:12,352
from an investing perspective. But then you think about this and you look at it now, we have,

1159
01:36:12,472 --> 01:36:19,652
relatively good inflation numbers, sorry, not inflation, unemployment at 4.2%. 4% is typically

1160
01:36:19,652 --> 01:36:26,512
perfect employment. People always bring up the participation rate, whatever. Inflation is

1161
01:36:26,512 --> 01:36:32,412
sticky, but stable. And so from that perspective, I don't think inflation is going to drop.

1162
01:36:32,412 --> 01:36:39,092
You got Powell today that invents a new term, tariff inflation. I was watching whatever CNBC

1163
01:36:39,092 --> 01:36:45,392
while that was on. The price of Bitcoin drops 500 bucks on that new term. I think if I can name

1164
01:36:45,392 --> 01:36:50,912
where we are today, previously we had a term called with low interest rates was Goldilocks.

1165
01:36:51,312 --> 01:36:55,072
It was like, oh, interest rates are relatively low. They're going to stay stable. The market's

1166
01:36:55,072 --> 01:37:00,112
going to pump up. Hopefully inflation will come down and you have Goldilocks. I think right now

1167
01:37:00,112 --> 01:37:07,612
where we are is crappy locks. It's kind of just crappy. And from that perspective, we go back to

1168
01:37:07,612 --> 01:37:14,212
why am I bullish? It's like, well, I want a non-sovereign, non-correlated asset that's

1169
01:37:14,212 --> 01:37:20,432
probably not susceptible to tariffs with having a positive administration related to Bitcoin.

1170
01:37:21,192 --> 01:37:28,112
And I'm like, oh, so if these companies that are dependent upon supply chains, which come from

1171
01:37:28,112 --> 01:37:34,732
China, which we probably have a trade war with or a tariff war, I would want to own something

1172
01:37:34,732 --> 01:37:35,972
that's not affected by that.

1173
01:37:36,632 --> 01:37:37,372
Hence Bitcoin.

1174
01:37:37,612 --> 01:37:39,792
So if we're in this crappy locks state,

1175
01:37:40,132 --> 01:37:45,432
that's why I like these Bitcoin-based companies,

1176
01:37:45,752 --> 01:37:47,672
whether it's strategy or other ones,

1177
01:37:47,732 --> 01:37:50,392
potentially GameStop and Semler.

1178
01:37:50,752 --> 01:37:52,672
I think that that would be the path to go

1179
01:37:52,672 --> 01:37:54,752
because at least there we have volatility.

1180
01:37:55,412 --> 01:37:57,972
And the mindset is that Bitcoin's going to run up

1181
01:37:57,972 --> 01:37:58,952
in the future.

1182
01:37:58,952 --> 01:38:01,432
And it's not going to run up by 10, 20% a year.

1183
01:38:02,052 --> 01:38:04,552
So my view is I think it's the most positive asset

1184
01:38:04,552 --> 01:38:07,992
that you could buy in right now, given a crappy locks,

1185
01:38:09,212 --> 01:38:10,612
you know, market.

1186
01:38:11,672 --> 01:38:13,152
Guys could agree, disagree.

1187
01:38:15,472 --> 01:38:20,392
Yeah, everybody's constantly trying to value

1188
01:38:20,392 --> 01:38:23,672
the opportunity cost of capital, right?

1189
01:38:23,672 --> 01:38:28,452
And it seems like the market has largely overestimated

1190
01:38:28,452 --> 01:38:32,052
the risk of Bitcoin and underestimated the risk

1191
01:38:32,052 --> 01:38:36,232
of AI and innovation and tariff risk.

1192
01:38:36,232 --> 01:38:41,012
And it seems like they just quite haven't figured it out yet.

1193
01:38:42,352 --> 01:38:45,172
That's my current thesis is that everybody's

1194
01:38:45,172 --> 01:38:47,332
overestimated Bitcoin risk.

1195
01:38:47,332 --> 01:38:48,212
And you could see it, right?

1196
01:38:48,212 --> 01:38:49,812
Just go on LinkedIn for five minutes.

1197
01:38:49,812 --> 01:38:52,572
You could see everybody's overestimating Bitcoin risk.

1198
01:38:52,572 --> 01:38:53,412
They're overestimating.

1199
01:38:53,412 --> 01:38:55,972
And I think the horror show that we see is that

1200
01:38:55,972 --> 01:38:58,532
on my XV, these companies come up,

1201
01:38:58,532 --> 01:39:00,352
and this is horrible to see,

1202
01:39:00,352 --> 01:39:04,512
They're buying, they have a supply chain that goes through China or Vietnam.

1203
01:39:04,952 --> 01:39:08,632
They moved it from China to Vietnam in the last administration.

1204
01:39:09,072 --> 01:39:12,972
And what we're seeing happen here right now is they're like, hey, look, these tariffs go.

1205
01:39:13,132 --> 01:39:15,792
And they're like, well, just rehome your supply chain to the U.S.

1206
01:39:16,192 --> 01:39:21,112
Well, there's no vendors in the U.S. to do that within 15 days or 30 days.

1207
01:39:21,112 --> 01:39:25,952
So you have these companies that are, unfortunately, in a really, really rough spot.

1208
01:39:26,132 --> 01:39:27,432
I really feel bad for them.

1209
01:39:27,532 --> 01:39:28,212
I truly do.

1210
01:39:28,812 --> 01:39:39,532
And in that sense, it's like, well, and I don't want to ever say I told you so, but this particular area is, it's pretty rough that they're in that spot.

1211
01:39:39,532 --> 01:39:45,372
And I think doing that very quickly to have them move to US-based supply chain is very difficult.

1212
01:39:46,452 --> 01:39:56,412
And, you know, I mean, we've been talking about Bitcoin for years and we've been in this space talking about this for a couple of years with Bitcoin on the balance sheet.

1213
01:39:56,412 --> 01:40:04,172
But I think other companies, this caught them off guard with potentially, typically when Republicans come in, the market rips up.

1214
01:40:04,272 --> 01:40:08,452
And now the market has had these really crappy statistics that Ben just went through.

1215
01:40:08,752 --> 01:40:11,052
I don't think people would, they're self-inflicted.

1216
01:40:11,532 --> 01:40:16,772
And I've seen a lot of people try and rationalize that by saying, oh, but in the future, this will be good.

1217
01:40:17,492 --> 01:40:21,552
I'm like, well, if your company's out of business, I guess that's good.

1218
01:40:22,292 --> 01:40:22,772
Really?

1219
01:40:26,412 --> 01:40:27,412
That's right.

1220
01:40:27,412 --> 01:40:32,472
I mean, we're in this totally strange environment.

1221
01:40:32,472 --> 01:40:36,412
It seems like a lot of investors have the clutch pushed in still.

1222
01:40:36,412 --> 01:40:38,412
They're just waiting.

1223
01:40:38,412 --> 01:40:43,412
Ben, you had some statistics about Goldman Sachs got most people on the sidelines than

1224
01:40:43,412 --> 01:40:49,412
they've ever had before, which is a representation of people have the clutch pushed in.

1225
01:40:49,412 --> 01:40:50,412
They've exited the market.

1226
01:40:50,412 --> 01:40:53,192
They're like, I need to wait for this chaos to settle out.

1227
01:40:53,192 --> 01:40:59,832
figure out who to bet on in this future landscape of whatever this world is going to be two to three

1228
01:40:59,832 --> 01:41:05,032
months from now. And that's kind of what it seems like where we're at. But it also does seem like

1229
01:41:05,752 --> 01:41:12,472
something close to breaking, right? With equity market being down, pension funds are down,

1230
01:41:12,472 --> 01:41:16,952
interest rates are still high. With interest rates high, the bond market's in a really crappy

1231
01:41:16,952 --> 01:41:25,032
position. Everybody thought the 10-year treasury is going to come down. It seems like China is

1232
01:41:25,032 --> 01:41:30,072
dumping treasuries. You've got all of these things are happening at the same time. And

1233
01:41:30,072 --> 01:41:34,552
some of it's moving opposite of what everybody thought would happen. And so that's even caused

1234
01:41:34,552 --> 01:41:40,712
more uncertainty and chaos. And now where do you park your money in an uncertain and chaotic

1235
01:41:40,712 --> 01:41:49,112
environment. That's what people are up against. And Graeme, we talked a little bit before this,

1236
01:41:49,112 --> 01:41:53,992
the documentary you watched over the weekend, Panic, the 2008 documentary where it talks about

1237
01:41:53,992 --> 01:42:00,552
injecting liquidity into the markets. It's 10 years after 2008 financial crisis and it follows

1238
01:42:02,392 --> 01:42:07,912
Henry Paulson and Ben Bernanke and the trials and tribulations that they had to go through

1239
01:42:07,912 --> 01:42:15,432
and the stress and the environment that they were in to figure out how to prevent a Great

1240
01:42:15,432 --> 01:42:18,792
Depression. How do you prevent a financial collapse? And ultimately, they landed on,

1241
01:42:19,192 --> 01:42:25,112
we've got to bail out the banks. And they ended up injecting liquidity into the banks via the

1242
01:42:25,112 --> 01:42:31,592
Troubled Asset Relief Program, the TARP program. And it seems like we're getting close to something

1243
01:42:31,592 --> 01:42:36,072
like that. And this is what Jeff Park mentioned last week. You've got these Scrabble letter

1244
01:42:36,072 --> 01:42:40,152
programs that are the injection of liquidity. That's basically the money printer going burr

1245
01:42:40,152 --> 01:42:47,032
in a different way, right? It's under a Scrabble letter format. And it seems like we're getting

1246
01:42:47,032 --> 01:42:52,232
close to a situation like that, particularly with the political horizon. You know, midterms are,

1247
01:42:52,792 --> 01:42:57,032
people are going to start campaigning for midterms here in the fall. And, you know,

1248
01:42:57,032 --> 01:43:01,992
Trump doesn't want to be in a position to have a complete landslide, go the other way and like

1249
01:43:01,992 --> 01:43:09,032
lose the house and lose the congress uh so yeah it's a we're in a really interesting environment

1250
01:43:09,032 --> 01:43:16,712
but curious to know your guys thoughts yeah i could chime in on this and and and look so what

1251
01:43:16,712 --> 01:43:23,272
happened was in 2000 there was a credit monetization act of 2000 which basically allowed the banks in

1252
01:43:23,272 --> 01:43:28,552
order to take massive leverage for mortgage-backed securities to securitize them and do that and so

1253
01:43:28,552 --> 01:43:33,752
So what happened was Bill Clinton signed that into law under the guise of Alan Greenspan,

1254
01:43:33,912 --> 01:43:34,812
the age of turbulence.

1255
01:43:35,452 --> 01:43:37,712
He said that Wall Street would self-police.

1256
01:43:38,152 --> 01:43:39,672
He was completely fucking wrong.

1257
01:43:40,072 --> 01:43:41,492
They would not self-police.

1258
01:43:41,492 --> 01:43:43,572
And that blew up in 2008.

1259
01:43:43,852 --> 01:43:47,772
And yes, a Democratic president signed that into law.

1260
01:43:48,052 --> 01:43:52,492
And then Bush took the heat for it, which led to the actual event that you're talking

1261
01:43:52,492 --> 01:43:55,792
about in 2008, which that documentary was awesome.

1262
01:43:55,912 --> 01:43:56,812
So you watch that.

1263
01:43:56,812 --> 01:44:06,712
And so in a sense that that was kind of the naivete of Alan Greenspan, who is a very well-respected Fed chairman, made a massive fucking blunder.

1264
01:44:07,632 --> 01:44:11,912
And anyway, and I read his book and I was a big fan of him, but completely naive.

1265
01:44:12,472 --> 01:44:14,252
So you have the great financial crisis.

1266
01:44:14,652 --> 01:44:25,652
Then what happens, you follow that up with COVID, a naturally occurring worldwide epidemic, or if some people think about a global conspiracy, to screw the whole world.

1267
01:44:25,652 --> 01:44:33,372
OK, so that happens. And now you have where we are today, which the global financial crisis killed the real estate market.

1268
01:44:34,012 --> 01:44:38,272
COVID pretty much killed every restaurant that couldn't survive.

1269
01:44:38,672 --> 01:44:48,052
You finally rise up from the ashes now. And now we have a new administration that comes in, which is Bitcoin and crypto friendly, supposedly business friendly.

1270
01:44:48,052 --> 01:44:54,612
But they want to change the world order by tariffs. And then they cause another finance, they cause another stock crisis.

1271
01:44:54,612 --> 01:45:05,612
But the catch here is we have relatively high inflation, at least 50% higher than the 2%, whatever the current number is, sub 3%, but still 50% higher than 2%.

1272
01:45:06,192 --> 01:45:13,032
And you have full employment, so they don't want to cause a recession, and they can't cut interest rates.

1273
01:45:13,172 --> 01:45:15,012
That leads us to crappy locks.

1274
01:45:15,352 --> 01:45:22,432
So you have these three different events that we're now in, and this one, it's like, okay, what are you going to buy?

1275
01:45:22,432 --> 01:45:26,612
You're going to either leave money on the sidelines or you're going to invest in something.

1276
01:45:27,552 --> 01:45:29,712
And I'm a permable.

1277
01:45:29,932 --> 01:45:40,072
I always think at some point in the future, nine months, a year out, what decision do I make today if I want to buy LEAPS to take leverage in the future?

1278
01:45:40,512 --> 01:45:43,032
And I think about what would be the best stocks to buy.

1279
01:45:43,412 --> 01:45:45,492
Obviously, it's based upon what we talked about on the show.

1280
01:45:45,932 --> 01:45:47,572
So I think that's where I see we are.

1281
01:45:47,712 --> 01:45:48,552
It's where we are.

1282
01:45:48,552 --> 01:45:52,292
We've had these three crappy events that have now happened.

1283
01:45:52,432 --> 01:45:56,532
And I think that on this call, people should be aware of where we are.

1284
01:45:57,612 --> 01:45:57,972
I don't know.

1285
01:45:58,092 --> 01:46:01,352
I'm bullish because I see how the market's going to get better.

1286
01:46:02,192 --> 01:46:04,332
Other people are like, I'll just keep cash on the side.

1287
01:46:04,732 --> 01:46:06,332
That'll be like a year from now.

1288
01:46:06,972 --> 01:46:14,552
And I wish you bought those GameStop calls at $35 for January when it's trading at $60.

1289
01:46:14,932 --> 01:46:30,920
One of the biggest environment differences between 2008 is that there was a presidential race happening at the same time So you had all this frenzy and this chaos that started in like I don know July August And then you know Lehman failed

1290
01:46:31,700 --> 01:46:33,980
And that was like September, October.

1291
01:46:33,980 --> 01:46:41,320
And then there was like gridlock because there was a split Congress, House and the Senate were different parties.

1292
01:46:42,020 --> 01:46:50,840
And basically the Secretary of Treasury, Henry Paulson, had to go in front of Congress and get Congress's approval to go bail out the banks.

1293
01:46:50,840 --> 01:46:56,780
and it was wildly unpopular. And they were getting into this new presidential landscape.

1294
01:46:56,780 --> 01:47:03,960
And it just, it took so long because there was no agreement on the political front either. So

1295
01:47:03,960 --> 01:47:08,400
they had to go convince all of the politicians and go through this process, which was an extended

1296
01:47:08,400 --> 01:47:14,640
period of time. And there was a lot of uncertainty with the presidential race going on at the same

1297
01:47:14,640 --> 01:47:22,820
time. So now you've got a red wave. You've got the Congress, the Congress is Republican. You've

1298
01:47:22,820 --> 01:47:27,680
got the Republican president that's market friendly, that is pro market, right? You had the

1299
01:47:27,680 --> 01:47:34,120
five of the mag seven CEOs were at the inauguration day, right? I'm sure those guys are on speed dial

1300
01:47:34,120 --> 01:47:41,420
and they've got lines into the president and the politician. So you think about the landscape and

1301
01:47:41,420 --> 01:47:46,700
the game theory of like where markets are going here. And it seems like things are going to tip

1302
01:47:46,700 --> 01:47:52,920
the scales eventually to, you know, help, help the markets. Markets always win. Yeah. And so

1303
01:47:52,920 --> 01:47:58,280
people should watch that documentary. So Bush was already in second term. He knew that he could not

1304
01:47:58,280 --> 01:48:05,460
be reelected. So there had to be a new president and it was McCain versus Obama. And then in that,

1305
01:48:06,280 --> 01:48:09,380
you know, the first thing when they went to Bush, he goes, I'm not bailing out Wall Street.

1306
01:48:09,380 --> 01:48:13,920
they made a wrong bet. And Paulson's like, if you don't bail it out, it will not only be a

1307
01:48:13,920 --> 01:48:19,900
depression in the U.S., but a worldwide one. And Bush is like, look, this doesn't play well.

1308
01:48:20,300 --> 01:48:25,620
Bailing out Wall Street does not play well in Midland, Texas. That's exactly what he said.

1309
01:48:26,240 --> 01:48:31,360
And so that's what McCain went with and Sarah, whatever.

1310
01:48:31,560 --> 01:48:31,800
Palin.

1311
01:48:32,100 --> 01:48:36,600
Palin went with and they lost the election. So what I'm saying here is Trump is,

1312
01:48:36,600 --> 01:48:42,480
if you believe in the constitution, Trump cannot get reelected. And so what's going to happen is,

1313
01:48:42,500 --> 01:48:47,640
is that the midterms are going to come up. They have to turn the market around. And so from that,

1314
01:48:47,820 --> 01:48:52,600
you know, I think it's going to be something's going to have to change and be bullish. I'm

1315
01:48:52,600 --> 01:48:58,580
bullish on the second half of this year. And if I want to make big returns, I have to make my

1316
01:48:58,580 --> 01:49:05,560
my plays right now on low volatility to buy low prices. If I wait until the volatility spikes,

1317
01:49:05,560 --> 01:49:12,200
then it reduces my returns on my options by 50% or 80%.

1318
01:49:12,200 --> 01:49:16,260
If I wait three months to buy, it could trade sideways.

1319
01:49:16,840 --> 01:49:19,540
But I know buying now to lock in that is really cool.

1320
01:49:19,880 --> 01:49:21,660
The other thing that people should think about

1321
01:49:21,660 --> 01:49:24,860
is that if you buy options and you sell half of them

1322
01:49:24,860 --> 01:49:27,040
and then you exercise the other half,

1323
01:49:27,200 --> 01:49:29,920
you get long-term capital gains on the remaining ones.

1324
01:49:30,600 --> 01:49:32,060
And a lot of people miss that

1325
01:49:32,060 --> 01:49:34,160
because it drops in my tax bracket.

1326
01:49:34,160 --> 01:49:44,040
it drops my taxes by 50%. And so if Goldman, if they're so fucking smart, sorry, I don't give a

1327
01:49:44,040 --> 01:49:48,700
fuck if I swear. If they're so smart, then they're sitting on the sideline. Now would be the time

1328
01:49:48,700 --> 01:49:54,980
that you buy. And then one year later, you peel off 20% of your gains with long-term capital gains

1329
01:49:54,980 --> 01:49:58,900
because you bought it when it was down low. What are they waiting for? The price to drop even lower?

1330
01:49:59,500 --> 01:50:02,520
It's like, okay, I didn't say throw all your money in it,

1331
01:50:02,700 --> 01:50:05,240
but the whole idea is to get long-term capital gains

1332
01:50:05,240 --> 01:50:09,120
and cut your taxable rate in half.

1333
01:50:09,420 --> 01:50:11,240
I mean, if you pay taxes and you had wins,

1334
01:50:11,520 --> 01:50:13,880
you see how much that costs you.

1335
01:50:14,020 --> 01:50:14,980
This is really simple.

1336
01:50:16,200 --> 01:50:18,300
So if I was going to talk to a Goldman Sachs guy,

1337
01:50:18,400 --> 01:50:20,480
I'd say, yeah, so why don't you tell me how that works?

1338
01:50:22,800 --> 01:50:25,360
I'm just tax loss harvesting since January 1st.

1339
01:50:25,860 --> 01:50:28,360
Yeah, we're in a different environment at the moment.

1340
01:50:28,360 --> 01:50:29,520
Tax loss harvest.

1341
01:50:30,040 --> 01:50:30,840
Hey, you know what?

1342
01:50:30,880 --> 01:50:34,720
I actually made a tweet on December 31st that I tax loss harvested for 2025.

1343
01:50:35,620 --> 01:50:38,280
So, sorry, for 2024.

1344
01:50:38,920 --> 01:50:43,700
But right now, I think that you have to think about where you think the market's going to be in a year.

1345
01:50:44,000 --> 01:50:45,720
And that's where you buy your position now.

1346
01:50:45,720 --> 01:50:50,200
If you think we're going into a depression, then do that accordingly.

1347
01:50:50,440 --> 01:50:57,160
If you think that the market's going to turn around after all this bad news, and it has the drop that happened today,

1348
01:50:57,160 --> 01:50:59,120
we're not going to get help from Powell.

1349
01:51:00,740 --> 01:51:01,180
Yeah.

1350
01:51:01,320 --> 01:51:01,660
So.

1351
01:51:03,680 --> 01:51:04,120
Yeah.

1352
01:51:04,220 --> 01:51:04,700
I mean,

1353
01:51:04,700 --> 01:51:06,120
it'll be interesting to see how it plays out.

1354
01:51:06,580 --> 01:51:07,100
A hundred percent.

1355
01:51:07,500 --> 01:51:10,740
All eyes on the fed and Scrabble tiles,

1356
01:51:11,140 --> 01:51:12,140
Scrabble tile programs.

1357
01:51:13,200 --> 01:51:14,320
And who's,

1358
01:51:14,460 --> 01:51:14,680
yeah.

1359
01:51:14,860 --> 01:51:16,180
Just what breaks,

1360
01:51:16,380 --> 01:51:16,600
right?

1361
01:51:16,720 --> 01:51:18,240
What we don't,

1362
01:51:18,480 --> 01:51:20,340
we don't know exactly what's,

1363
01:51:20,440 --> 01:51:21,140
what's going to break.

1364
01:51:21,300 --> 01:51:21,980
That's the other thing.

1365
01:51:22,660 --> 01:51:23,040
All that,

1366
01:51:23,040 --> 01:51:23,820
all that fraud,

1367
01:51:23,920 --> 01:51:27,120
waste and abuse has to be rerouted to pay for,

1368
01:51:27,160 --> 01:51:30,320
other things because, um,

1369
01:51:30,520 --> 01:51:34,020
like the system has to hide the deflation.

1370
01:51:34,800 --> 01:51:36,960
So they have to create inflation.

1371
01:51:37,440 --> 01:51:40,060
And so if you're going to think you're going to save a couple of hundred

1372
01:51:40,060 --> 01:51:44,580
billion or something with, with eliminating fraud, well, then what,

1373
01:51:44,680 --> 01:51:48,680
how do you, uh, how do you prop up the credit system? You got to go.

1374
01:51:48,780 --> 01:51:51,520
And I don't know if tariffs is that replacement, um,

1375
01:51:51,520 --> 01:51:56,220
or if they'll figure out something else to waste the money on, but, um,

1376
01:51:57,160 --> 01:51:59,460
Tariffs is kind of like any of the other taxes.

1377
01:51:59,680 --> 01:52:01,740
It's just a barrier to true price discovery.

1378
01:52:02,760 --> 01:52:05,040
But Bitcoin is imposing the free market.

1379
01:52:07,260 --> 01:52:16,480
So I guess if there's a silver lining, you own Bitcoin and you let everybody else get inflated and you just benefit from that.

1380
01:52:17,500 --> 01:52:18,640
All roads lead to Bitcoin.

1381
01:52:19,500 --> 01:52:22,040
Yeah, I got to drop off, guys.

1382
01:52:22,440 --> 01:52:23,920
But hey, I'll wrap up with this.

1383
01:52:23,920 --> 01:52:30,960
look uh bitcoin anybody that's been in bitcoin for a few years and i know for my followers a

1384
01:52:30,960 --> 01:52:36,380
large percentage of my followers have been in it for over four or five years so from that perspective

1385
01:52:36,380 --> 01:52:40,640
they have these massive gains and they walk around if you have massive you're sitting on massive

1386
01:52:40,640 --> 01:52:47,320
gains and you're you're a relatively happy person even with the dips if you're up three four five

1387
01:52:47,320 --> 01:52:51,840
six hundred percent because you've been in it for five years and you're walking around everybody's

1388
01:52:51,840 --> 01:52:57,760
miserable, you really can't smile. So maybe the Bitcoiners aren't talking. Or if you're in strategy

1389
01:52:57,760 --> 01:53:06,220
for me, the largest tranche I have was purchased in January of 23, right at basically the dead

1390
01:53:06,220 --> 01:53:12,440
bottom. So on some shares, I'm still up like a thousand percent. So in that perspective,

1391
01:53:12,440 --> 01:53:16,580
it's really hard to walk around and gloat with so many people that are under stress

1392
01:53:16,580 --> 01:53:19,180
and the price of eggs and inflation.

1393
01:53:19,960 --> 01:53:21,800
So from that, you know, on this call,

1394
01:53:21,880 --> 01:53:23,880
where we are with a lot of people that know about this,

1395
01:53:23,920 --> 01:53:24,920
that have been in this for years,

1396
01:53:25,460 --> 01:53:28,020
we feel we're like, we're positive

1397
01:53:28,020 --> 01:53:30,140
because we see the light at the end of the tunnel

1398
01:53:30,140 --> 01:53:32,440
to monetary debasement, deficits,

1399
01:53:32,960 --> 01:53:34,160
everything that we talked about,

1400
01:53:34,260 --> 01:53:38,260
and the CAGR that exists on cumulative average growth rate

1401
01:53:38,260 --> 01:53:39,420
on Bitcoin.

1402
01:53:39,680 --> 01:53:40,700
We could all guess at that.

1403
01:53:41,100 --> 01:53:42,700
And based upon that and a hurdle rate,

1404
01:53:42,820 --> 01:53:44,640
what are you going to invest in, right?

1405
01:53:44,680 --> 01:53:45,640
I was a huge bull.

1406
01:53:45,640 --> 01:53:47,200
I still own some shares of Nvidia,

1407
01:53:47,480 --> 01:53:51,200
but Nvidia has basically taken a huge drop because of the tariff wars.

1408
01:53:51,780 --> 01:53:53,480
So it's not that I don't think that what they're doing,

1409
01:53:53,640 --> 01:53:55,360
they don't have a moat and they don't have a great product.

1410
01:53:55,580 --> 01:53:58,600
It's just that that's where the current situation is.

1411
01:53:59,100 --> 01:54:01,140
So anyway, with that said, I think that, you know,

1412
01:54:01,160 --> 01:54:02,120
great discussion here.

1413
01:54:02,480 --> 01:54:05,200
Everybody should watch the 2008 documentary,

1414
01:54:05,880 --> 01:54:07,940
whatever that was called, Jeff, that we tweeted last week.

1415
01:54:10,440 --> 01:54:11,160
Watch that.

1416
01:54:11,480 --> 01:54:13,240
A superpower that I always talk about,

1417
01:54:13,240 --> 01:54:15,800
watch it on one and a quarter, one and a half speed.

1418
01:54:16,120 --> 01:54:17,480
It goes a lot faster.

1419
01:54:18,040 --> 01:54:19,820
And if you hear something interesting,

1420
01:54:19,940 --> 01:54:22,340
just back it up and knock it out very quickly.

1421
01:54:22,780 --> 01:54:24,540
Eric Schmidt talked about AI.

1422
01:54:25,060 --> 01:54:28,080
I think that's both interesting

1423
01:54:28,080 --> 01:54:29,920
and horrifying at the same time.

1424
01:54:30,320 --> 01:54:31,740
If people don't get AI,

1425
01:54:31,920 --> 01:54:33,200
then I don't know how they get Bitcoin.

1426
01:54:33,780 --> 01:54:35,860
And with that said, I'm bullish.

1427
01:54:36,220 --> 01:54:37,880
I can't wait to see you guys next week

1428
01:54:37,880 --> 01:54:39,520
in New York City and then in Orlando.

1429
01:54:39,840 --> 01:54:41,440
And thank everybody for joining.

1430
01:54:41,440 --> 01:54:48,720
yeah thanks green maybe we'll go around uh final final thoughts uh all around maybe uh maybe ben

1431
01:54:48,720 --> 01:54:53,380
yeah not much in terms of final thoughts just one thing that we didn't mention

1432
01:54:53,380 --> 01:54:58,700
that i'll just bring up is it looks like uh in the bitcoin treasury world similar's going to get

1433
01:54:58,700 --> 01:55:03,440
out from under this doj investigation sounds like they've agreed on their settlement there so

1434
01:55:03,440 --> 01:55:07,860
that was interesting because they quickly followed that up with a 500 million dollar

1435
01:55:07,860 --> 01:55:13,380
shelf offering and eric tweeting out which i thought was fake at the beginning luckily it got

1436
01:55:13,380 --> 01:55:19,060
confirmed that it was real real huh yeah it was real that uh you know they're back and he's excited

1437
01:55:19,060 --> 01:55:24,180
to go buy some bitcoin so that 500 shelf offering i think they're gonna start being active so it's

1438
01:55:24,180 --> 01:55:28,260
good to see him get out from under that it was costly no doubt about it probably cost him about

1439
01:55:28,260 --> 01:55:33,460
30 million bucks i think in total with legal fees you probably saw that they used the bitcoin

1440
01:55:34,260 --> 01:55:40,660
to secure a loan with coinbase to pay that off so um just interesting news out there but they

1441
01:55:40,660 --> 01:55:44,500
definitely opened up that shelf offering and it sounds like they're going to get back to the market

1442
01:55:44,500 --> 01:55:50,900
and start buying bitcoin again so that's good to see they were ready to celebrate huh yep over to

1443
01:55:50,900 --> 01:56:01,220
you dan uh yeah i think the macroeconomic stuff is interesting but it does miss the point of why we

1444
01:56:01,220 --> 01:56:07,320
we own Bitcoin. And so for me, at least I've had to kind of zoom out and, um, kind of take

1445
01:56:07,320 --> 01:56:12,640
and remember that I own Bitcoin in these related equities because I don't want to worry about

1446
01:56:12,640 --> 01:56:17,560
trading equities markets in different macroeconomic conditions. So sometimes if you need a break

1447
01:56:17,560 --> 01:56:23,620
from the doom and gloom, um, on Twitter, you gotta, you gotta step off. Yep. Absolutely. Tim.

1448
01:56:23,620 --> 01:56:35,780
can you hear me yep okay um not too much i i did have a question for ben uh ben you said that

1449
01:56:35,780 --> 01:56:42,620
uh you can't really uh make a living doing powerpoints anymore but grain told me i need

1450
01:56:42,620 --> 01:56:48,400
to do a couple slides for my keynote at true north world so like what should i do well the

1451
01:56:48,400 --> 01:56:52,020
beauty is we're not making a living from this tim so you're doing that pro bono like everyone

1452
01:56:52,020 --> 01:57:00,380
else is going to be here shortly so you're in good company awesome yeah no um i guess shout out real

1453
01:57:00,380 --> 01:57:05,840
quick to mike germano for hosting me here at pub key for uh tonight it's pretty cool i didn't

1454
01:57:05,840 --> 01:57:11,000
realize till we were i don't know 15 minutes in i had guitars on the wall behind me so pretty cool

1455
01:57:11,000 --> 01:57:17,440
look and obviously for everybody that's been here it's a pretty cool place to meet people and kind

1456
01:57:17,440 --> 01:57:24,000
of bring everything in Bitcoin into the culture and the reality and yeah just super cool.

1457
01:57:24,560 --> 01:57:28,760
Maybe we'll be able to do one of these live from that studio here sometime Tim that'd be cool.

1458
01:57:29,360 --> 01:57:35,260
Yeah I'm counting another right I got this blue microphone but there's one two at least three

1459
01:57:35,260 --> 01:57:42,200
other microphones here so yeah cool setup and they're inviting us in so.

1460
01:57:42,940 --> 01:57:43,920
Live from New York.

1461
01:57:43,920 --> 01:57:44,640
Lots of cool stuff to come.

1462
01:57:44,640 --> 01:57:46,080
Live from New York Tim.

1463
01:57:46,200 --> 01:57:46,760
Tim Cosman.

1464
01:57:46,760 --> 01:57:49,620
Tim, I appreciate you always hanging on and listening here.

1465
01:57:49,840 --> 01:57:51,140
It's really helpful.

1466
01:57:51,320 --> 01:57:53,940
You're a sponge of information,

1467
01:57:53,940 --> 01:57:56,260
and it really helps craft the conversations

1468
01:57:56,260 --> 01:57:57,720
that you've got with Bitcoin treasury companies.

1469
01:57:57,920 --> 01:57:59,140
So I appreciate it.

1470
01:57:59,460 --> 01:58:01,440
And as always, none of this is financial advice.

1471
01:58:01,560 --> 01:58:02,440
Well, it might be entertaining.

1472
01:58:03,660 --> 01:58:08,140
Pupti Lifehack, if you ask them for an extra pavvy

1473
01:58:08,140 --> 01:58:09,420
on your double smash burger,

1474
01:58:09,700 --> 01:58:11,180
you can get a triple smash burger.

1475
01:58:11,600 --> 01:58:12,240
Oh my gosh.

1476
01:58:12,260 --> 01:58:14,740
That smash burger is crazy good too.

1477
01:58:14,740 --> 01:58:20,960
It is like, I mean, you got to go wash your hands and your face afterwards, but damn, it is like crazy good.

1478
01:58:21,060 --> 01:58:21,580
Yeah, it was good.

1479
01:58:21,840 --> 01:58:22,020
Yeah.

1480
01:58:22,620 --> 01:58:23,560
So over to you.

1481
01:58:23,660 --> 01:58:24,140
Final thoughts.

1482
01:58:24,800 --> 01:58:25,000
Yeah.

1483
01:58:25,060 --> 01:58:27,240
Just back to the AI stuff.

1484
01:58:28,460 --> 01:58:35,840
You know, the credit-based fiat system has to hide inflation and AI is going to make deflation exponential.

1485
01:58:35,840 --> 01:58:47,440
So if you are holding an asset, I don't know, maybe Bitcoin, that is immune to that inflation, you might do well.

1486
01:58:48,960 --> 01:58:51,400
Bingo. You may do well. Absolutely.

1487
01:58:52,340 --> 01:58:59,020
And my final thoughts are we are in the golden age of Bitcoin securitization and there's a lot of opportunity everywhere.

1488
01:58:59,020 --> 01:59:02,780
and I encourage people to explore.

1489
01:59:03,100 --> 01:59:07,240
There's so many products that can help build a portfolio

1490
01:59:07,240 --> 01:59:09,020
so you can design your life

1491
01:59:09,020 --> 01:59:10,460
and live the way that you want to live.

1492
01:59:11,200 --> 01:59:14,360
And that's one of the beautiful things about Bitcoin.

1493
01:59:14,480 --> 01:59:16,660
I think it's going to continue to bring

1494
01:59:16,660 --> 01:59:19,080
and grow the entire ecosystem.

1495
01:59:19,500 --> 01:59:21,600
So I'm bullish Bitcoin securities

1496
01:59:21,600 --> 01:59:23,600
and excited for the future.

1497
01:59:24,880 --> 01:59:26,860
So right at two hours,

1498
01:59:26,860 --> 01:59:33,820
we've got 40,722 viewers across all platforms. Thank you, Sailor for the retweet. Boom. I love

1499
01:59:33,820 --> 01:59:39,180
it. Amazing. Helps us out. And yeah, I appreciate the time. Thanks, everyone. Thanks to all the

1500
01:59:39,180 --> 01:59:44,720
people in the chat. We will see you either next week at the Bitwise event. I think that is the

1501
01:59:44,720 --> 01:59:51,000
24th. That's Thursday, the 24th. And MSDR True North World is Monday, May 5th. And that is the

1502
01:59:51,000 --> 01:59:55,640
beginning of Strategy World, which goes that entire week from Monday through Thursday. I think

1503
01:59:55,640 --> 01:59:57,380
There, as of the end of here,

1504
01:59:57,380 --> 01:59:59,860
we've got seven tickets left and one sponsor ticket left.

1505
02:00:00,400 --> 02:00:01,980
And look forward to seeing everybody.

1506
02:00:02,940 --> 02:00:04,060
Yep. Thank you all for joining.

1507
02:00:04,140 --> 02:00:04,900
Really appreciate it.

1508
02:00:05,000 --> 02:00:05,440
Thanks, everyone.

1509
02:00:05,620 --> 02:00:06,100
Thanks, guys.

1510
02:00:06,400 --> 02:00:06,800
Good to see you.

1511
02:00:07,160 --> 02:00:07,720
As always.