Transcription
Everything that is leveraged, everything that has any form of leverage—housing, cars, everything you buy, stores, retail—it's going to collapse. You're going to have a right-sizing of the demand curve once debt gets devalued. And this is huge. This is global depression material. There's a search for a reserve asset that's not going to collapse like debt. It's a macro bull market for precious metals. And I can't be more ardent about that. When debt collapses, the buying power of the currency falls with it in the end.
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Hello and welcome back to Soar Financially. I'm here from the floor of the Deutsche Gold, the German gold show in Frankfurt, Germany. I'm the host of the channel. My name is Kai Hoffman, the Edj mining guy over on X, and I'm really looking forward to catching up with the market sniper himself, Francis Hunt.
Thanks so much for making the trip to Frankfurt.
Pleasure to be here.
Yeah, Francis, I'm amazed that you're here. Really appreciate it. And we have a lot to talk about. We only spoke April 9th, or right around that time. So about a week after Liberation Day, but a lot has changed since then. It's only what, is it now, six weeks after, but it seems like we're looking at a completely new world order. Things are changing. President Trump is currently in Saudi Arabia, in the Middle East, shaking hands, kissing babies, and paving the way to a new—let's call it a trade system, maybe even a new world order—I just used that.
What? Maybe let's start with a bit of a summary first, like what has happened since April 2nd?
Well, I'll even take you before April 2nd before answering the April 2nd bit. We're in a debt-based collapse. It's the foundation stone of everything that's going down. So you have a recent low print on CPI. Our basic scenario is stagflationary, and many people have come back at us and said, "Oh, but look at the low CPI number." And what happened during that time? We had a tariff, Trump's tariff tantrum where essentially he stopped containers.
It's almost like a mini-lockdown.
Yeah, they called it an embargo. Actually, I think Bess even said embargo.
100%. They stopped containers, which obviously is going to affect consumption and is going to lead to those low CPI numbers. More importantly, we had the Saudis decide to increase supply, and then further, today we see in June they intend to further surge their oil supply. So why, in a recessionary environment where goods haven't been provided, where there's a downturn in demand, we're hearing about record bankruptcies in the states, record levels of—they call it the 90-day—in bad state of repair credit card, automotive, and housing, all at literally new highs. And you've got all that environment and people are saying, "Yeah, you see, but the low CPI, we're not going to stagflate." So in that environment, why would the Saudis be pumping more oil? They've got to keep the inflation tax. Oil is a multiplier in inflation. It's in everything, as you're well aware. Delivery, you name it. Travel, business, commercial, holidays, everything you buy, everything you do, packaging—100%, breaking ground, whatever you do. So it is an absolute. So if they get a disproportionate supply and demand, they put downward pressure on oil. We were the guys that told you a couple of times on when we've appeared on your show, long gold, short oil, because essentially we're in a consumer retail-based, in a recessionary type environment, while in that same time we're getting a debt-based collapse, referring you to my opening statement, which means we need a new reserve asset. Let's go back to the old reserve asset, aka gold.
The other key point is those long-term debt percentages are going up across the board, with a possible exception of China and Switzerland. You're looking at the 10-year, the 20-year, and the 30-year, all going higher on rates. What is that? Debt devaluation. That's going to kill the housing markets. This is the—we referred to the massive amount of rejections on refinance applications in the states—42%, 36%. Nobody wants to originate a debt instrument asset anymore, by borrowing, by letting people borrow, and at the same time, the existing assets on the long, which are on long debt, are actually—we've got the curve steepening, and the rates are going up. So the asset is devaluing immensely. So that's what's going on. And you've then had the stop in the economy. I call it the effect of a mini-lockdown. You can call it an embargo. It has a similar effect. So you get a low inflationary read. It's trying to massage the numbers. The Saudis are in cahoots. They will be compensated for doing not-for-profit selling, and they are being compensated in many, many, many ways. They're becoming the entertainment hub. Well, the Middle East, the Arab Emirates, let's not be too specific. You're getting all the football there. As I was joking with you, they don't play rugby, and they're already down for—after Australia—to host the next rugby world cup in the desert somewhere. All of these things are being crowded into that area. You had Elon moving Neurolink labs to Dubai. All of this is happening. I actually think you're seeing the tech hub that Silicon Valley once was, in part, being slowly bled out, and Trump is enabling this. So everyone who thinks he's MAGA and make America great should maybe think again because his big pals with the Saudi Arab Emirates are normalizing this society, as they are seeing it as a coronation in terms of the significance of their region in the area, as far as I'm concerned.
So I mean, I've said a lot in that, but maybe you can pick.
Absolutely. Lot to follow up on, right? Let's dissect the inflation topic a little bit because it's an interesting one because it seems to be the guideline that the Fed bases its decision on, like very data-dependent, apparently, right? Run us through that logic: 2.3%, we're near the 2% target, right? But yet the Fed doesn't see the need to cut. Like what is the Fed seeing maybe differently than what you're saying? Because I feel like they're starting to get pressured into lower rates here.
Well, when you say the Fed, everybody assumes that the Fed gets to determine the interest rates. And again, I refer you to literally the opening stage. It's a debt-based collapse because for the Fed to be able to set the rates lower, you're actually saying, "Well, this asset is now worth more, and there's an absolute plethora of it." They've got 9 trillion to roll. They haven't—that's not including the additional expenditure that are gone. In truth, the doggy savings that you've been told about are minuscule, and if you look at it in a big timeframe curve, there's no real meaningful adjustment. Not that I'm going to say if any efficiency is a bad thing and culling a lot of the bulb products, but this is nickel and diming. It's, you know, it's saving—it's pence, saving 10% or whatever it is. Pence-wise and pound-foolish. You know, the big money is the problem. And so as a result of that, he doesn't have the power to cut rates. In fact, the Fed's never been more clearly boxed in. They need actually for the debt to be devalued. They should, on that behalf, be comfortable with raising rates. Think of a Volcker upswing, that was the 80s. But in terms of the economic health of the consumer and the nation and the state of bankruptcy that I imagine many consumers are in, many municipalities are in, many states are in, they can't actually do those cuts because there's no bid on the debt. So this is all about the reserve assets that was afforded to bonds that ended with the 40-year bull market. He doesn't have the power; he's boxed in.
Well, he got himself in the hot seat, or like his presidents or governors of the Fed got him into a hot seat because they were openly talking about stagflation.
Yeah. Like they didn't call it stagflation, but well, slower economic growth, higher inflation—her definition, stagflation. They didn't use that word. Trump was enraged. She was like, "Oh, we got to find a new Fed chair." And then he sort of figured out, "Well, I can't change the guy." You know, he's got a term till 2026, and everything calmed down again. But it was headline news for—that's a private company that you have no say over.
Exactly. Right. Not even Congress can do much there. So it's really interesting because they are seeing that exactly what you're saying. They should be raising, almost into that environment, what they're seeing.
Right. So why aren't they? Like what's holding them back then?
Well, it's a bit like a paralyzed rabbit caught between two fences. They're damned which direction they move. They're going to trip the wire, and the, you know, the limpid mind goes off. So it's almost like frozen in the headlights right here because then, at least, I can't be blamed for something going, an action I take being blamed. It's it's kind of—it becomes a blame allocation for the situation. You know, you take any action, you trigger the wire, you—I was going to say is like when they even cut, like what signal does that send? Like, "Oh, the economy is suffering," like, or the Fed is cutting. Why are they cutting? Aren't we doing so well? You're damned whatever you do. And the whole point is the entire situation that he's in is an unrescuable situation. And he is—he is the guy holding the bag for Greenspan, Bernanke, Yellen, and all those that came before him that allowed government over-expenditure, ran too low interest rates, and ran an asset price hyperinflation just because we globalized and we had low consumer inflation. There was still inflation; the liquidity just found its way into assets on debt. So now we actually have to reverse that, day into night, which is everything gets flipped on its head, and it's deeply unpleasant. So we're predicting, you know, asset price devaluation, and the long end of debt is going to cause—and it's not just America, by the way, because we're talking a lot about the Fed and everything else. I'm going to be showing today—on our—well, tomorrow it is—my speech that the German long rate is going to go higher and is going to go to 4%. I'm going to show that the Australians are hitting for 6%. Now, Australia glided through the GFC on their property market. I'm saying not this time. So housing is going to be chronically affected. But everything that does—that is the amazing word that no one's mentioning in all of this is the word bank. Nobody's speaking about bank health in this environment. You've got crushed consumer, you've got defaulting credit in just about every category, you're going to have a contracting housing market, and yet nobody's talking bank. That makes me distinctly nervous because that's—that's where the spotlight's not being shown, and those are the areas I worry about.
It feels like it's a slow death, like very slow, like prolonged, like there are some write-offs here. There's a commercial building that's being written off there or sold for a dollar instead of 500 million. But it's not happening all at once. Like Andy Shackman says, "Little by little by little by little, and then all at once." I think it was Hemingway, or even like you're—you're broke, like you find out you're broke, like right slowly at first, like, "Oh, yeah, I'm losing money here," but then all of a sudden I'm—I'm broke.
Yeah, right. So I think that's what we're seeing right now, and it's not really accumulated yet, if that makes sense. But everybody's got to realize that the originator of money is commercial banks, in every essence. You're not getting somebody's savers' money when you buy a property. They are originating new money. And with everything that we've described—from consumer, state, municipal, government, everybody being bankrupted—how is it that no one's talking about banks? That's a massive question. And it's because the searchlight is intentionally not being put on that focus. They'll quite happily talk about how wrecked consumers are, how wrecked commercial property is, how—and I'm busy telling you the future for residential property in America and Germany, Australia is all going to be heading down in real terms, but no one's going to talk about the assets that sits with banks and the effect—conspiratorial or conspiratorial—that word.
Well said, because the banks are sitting at the table. Larry Fink is touring Saudi Arabia right now, as he's in the Middle East. The banks are like—they've been paraded around the White House like, "Hey, look, my friend just made a billion dollars here."
Um, right. And I've been reading about massive trade gains in all the banks on the trading desk, so last quarter actually. So they're actually profiting massively from the uncertainty that's been created. I'd imagine the trading rooms are—there certainly seems to be a cacocracy of insider trading. I mean, I'm posting on Twitter, "Best trader in the world, number one, best trader in the world, number two." And we have Nancy Pelosi, we even have Marie Green, buying into Palantir just before they go up 60%. Apparently, the Middle East are going to be putting in 300 million into Trump Token. So crypto is going to become this cacocracy. Interestingly, the Economist had, as a leader, "The crypto swamp." So Trump is getting enriched through this. I mean, these insiders all around them, we are watching absolute skullduggery and cacocracy and malfeasance and financial fraud for the insiders, without a doubt, going on on an epic scale.
Well, when somebody texts or tweets, "Buy stocks," four hours before, you know, the tariffs are being announced or the tariff taken off being announced, and you see inordinate sums buying expiry on the day call options that are near worthless, deeply out the money, that go up 1,000% on that same day as a result of that announcement, that's the key detail. And they come away multi-millionaires. That's assuming they weren't already to start, but it sounds like degenerate gambling to me, to be honest.
But uh—well, when you have the insider information, it's almost a sure thing, isn't it?
Absolutely. We got to talk recession because lately—and maybe I haven't been paying attention before—but now mainstream media is talking about the recession forecast of the banks, the big banks. They've revised them down now 35% to about 50%, depending on the bank. They were higher before. Steve Hanky, we had on the program, had a 90% recession for sure. Where do you stand? Elaborate on that a little bit. You touched on it earlier.
Yeah. So there's a reason there's been real volatility in the predictions, and that's because we had real volatility. We had an earth-shattering moment, and the key earth-shattering moment came about, Kai, is when peak Trump tariff tantrum. What actually happened is the bond market collapsed, rates shot up, and the dollar went down. That was the first time that ever happened meaningfully in the US. By the way, it fulfilled the prediction that we made when the same thing happened in the UK. Something I'll be reminding people in our chat as well with when they had the pension crisis. Everybody thinks rates up, your currency goes up. Normally that's the case when you are having a complete loss of faith moment, as was experienced then. It was earth-shattering and very much shook the American wedding party, let's just say. And at that point, while that happened, you saw a flight out of the dollar and a flight out of treasuries, and that was a very, very short, sharp slap on the face for Donald Trump, which he later said, "Oh, I wasn't afraid about the bond market," which I interpreted to mean he was afraid about the bond market, or someone who explained it to him told him he should have been afraid about the bond market. So suddenly, they reigned that back very harshly and renormalized. So during the period while we were in that peak dollarization, suddenly isolationist American moment, he suddenly came back out and said, "Let's make friends, let's work together," all again, and they quickly, quickly reversed back that line, so it was a very—they tested the line; they got a very hard slap. Now a lot of those predictions of 90% recession in for the US were being made in the heat of the dollar losing value and the bonds losing value simultaneously. Now suddenly, then the ability they've shown to actually reflate and normalize, which has been quite spectacular as well, excuse me, has seen everybody rain it back. So everyone panicked with the panic, and everybody's gone, "Hey, we're back to everything hunky-dory." Neither is right. The people that are thinking they're back to hunky-dory, you just saw a flash of the future in a small microcosm moment that comes back again. So remember the guy who predicted it when it happened in the UK that said it's coming for America. It's happened once. You've had five minutes of it. Now wait till you have a full day. Now wait till you have a full week of it. It will come back. So I'm afraid that this is the beginning of drama and a first test. It's a—it's a fight where we've stood each other off in the pub, Kai, and you thought I was a wimp, and you marched right up in my face, and then next thing you know, I gave you a short, sharp slap.
You're good. I'm—I'm a—I'm a ninja. I'm an absolute ninja. And then you—you got over your slap, and you thought, "Okay, hang on." You had another beer, and you got strong again, and you're coming back at me, and this time I'm going for the Jedi five-finger punch to your chest. So that's the scenario where—and I think everybody thinks that—that—that it was all over and that it's back to normalization and we can rein this all back. It isn't.
Yeah, I kind of like the sleeper grip, you know, on the neck.
Oh, I can tell the Star Treky news coming out. I have to admit I like the last movies that came out, the recent ones.
So no, no, good stuff. So for instance, like you just hinted at it, like it seems like either you're seeing a really, really strong dead cat bounce, or it is the final stage of a blowoff top. Like what camp are you in? Is it like somebody bounced the cat really, really hard, and we just see it spike up, and it's about to crash down even harder, or is this really a blowoff top, and then we'll see where it goes?
The most retail thing is to over-fascinate on stocks. I'm not actually strongly anything short, medium-term on stocks. Long-term, I'm—the most interesting market is the bonds. The bonds are the dominator and the leads. So when someone will ask you about a stock market, I say in due course deleveraging takes its course on the stock market too, which is down, because you've got corporates—at one point I had a stat, I don't think it's an up-to-date stat—15% of the S&P 500 was borrowing to pay dividends. Why? Because at the time the cost of borrowing was much lower than the cost associated to equity ownership. So now imagine once you start deleveraging and the long-term rates are going like that, you're going to have equities that are going to be sitting with highly leveraged balance sheets. I once saw—there was a very good article that compared Coca-Cola to Coca-Cola a decade and a half ago. And in actual fact, it does less revenue, less earnings, loaded up on way more debt on buybacks, and actually is a lesser company, but was trading at two and a half times what it was 15 years ago. So the point is that mathematics inverts, and that's what's going to be long-term negative for the stock market right now when we have an absolute fear moment brought about by the tariff tantrum with a subsequent hypernormalization reactionary moment. This is just chop and volatility, and as I say, focus on the debt markets, focus on housing, focus on jobs. Unemployment is the final shoe that drops with this, and we're already seeing Microsoft letting go a lot of people. That's a lot of high salaries coming off that now want welfare on earning, going to be making mortgage payments, etc., etc., and those things bring the whole can down, and then there's only one way for the stock market—down—right now. When you're getting a little bit of liquidity fed in, you can have a natural reaction back up, but long run, we've got to unlever, but when I say down, you've also got to remember the dollar is going to go into that convexity period where it's spilling super fast all debt as it devalues. It's kind of like a mortgage payoff chart. It's like this, and then it gets suddenly very, very vertical. We're at that point where things are about to accelerate in debt devaluation, which is the rates, and it's going to get sudden and fast, and it's going to be also currency devaluation because money's borrowed into existence. The only reason most won't notice it—we already—it's already happening to a degree now—is we compare dollars to euros. We all synchronize lepers in the leper colony. You've got to compare it to gold. And that's where we come to gold.
We got to talk about flow of funds, like where's the money going? Like, you know, we had a Danish pension fund manager throwing a tantrum, said, "No, we're done investing in the US," for example, only domestically. You touched on Saudi Arabia. Before we hit the record button, you mentioned to me it might be flowing into Swiss bonds because they're negative yield right now, even so—some—there must be very high demand.
Of course, nobody's buying negative yield products. I wouldn't buy them, but it signals certain safety and security, I guess. But where's the money going, and do you see a chance of it actually ever coming back?
So just to deal with that measure on the Swiss, it's the short end, first of all. So it's one and two years that have just dipped negative again, and that is a sign of distress. So what that means is really afraid people are prepared to guaranteed accept less money back in one or two years' time than they give you. Plus Switzerland still has an inflation rate. It's between 1.3 and 2.2, depending on any given year. That's according to their status exemplar of stats, which I'll never trust on any nation. But anyway, it's their route. Let's just say—let's take them at their word. So you're going to lose the inflation rate, and you're going to get less. You'll pay a premium if you do a two-year; you're essentially going to pay 104,000 to get 100,000 back, or you'll buy 100,000 bonds and get 94 back in two years' time. That's expensive, and that makes gold look cheap. You know, Buffett criticized gold for not paying a yield. When you're paying a negative yield, not paying a yield becomes a feature, a benefit, and that's why I say, even though there's a pullback right now in gold, go and look at the Swissy gold chart. And I consider the Swiss Franc probably one of the more semi-serious fiats, go and look at the Swissy gold chart. We've just made some number of macro targets. There will be a slight pullback, but it's going—going to go higher in my view.
Yeah. But do you see a chance of it coming back? Like something's pushing the stock market higher, obviously, right now. The bond market is somewhere—I don't know. It's like it's caught in a band right now. It seems like in the US, the 10-year, at least when I look at it.
History is quite binary: your bonds or your stocks. When you're risk-on, you run into stocks. When you're afraid, risk-off, you run into bonds. It's quite binary, and people are being traded in that. That's the 60/40 portfolio. That programming is going to take a while to unfill. So initially right now, that long bonds are being sold off, and everybody realizes Dalio and Tudor Jones have been short and have been building a short position that they now disclosing in November last year. They probably did it the whole year getting their positions on. Now everybody thinks, "Okay, maybe we should be following suit." So the natural flow is often equities to start. But if you become really worried and you want to stay in bonds, you go to a country like Switzerland on the short end, which is what we just described. That's an illustration of stress and fear about return of capital.
Instead of return on capital. But the smart will really say bonds isn't the game. It's a crap product, no matter where you buy it. Um, you're either not getting paid enough yield, or your risk of default isn't fully priced in. That's why we're seeing the long ends continue to price up, uh, because the risk of default is far more critical and likely to happen. So bonds is the worst investment anywhere you do it, in my opinion. Long, short end, any nation—stay out. And what tends to happen is, okay, where's the reserve asset? And that's why I say, uh, gold will benefit. We've seen a little bit of a better performance from crypto; it's a much smaller market cap, but there's some flows in there, um, and that's what—and there's more of a risk-on asset.
Sorry to jump in.
It is a risk-on asset, yeah, it is a risk-on asset, but it's being treated slightly differently because it's time as a future waiting in the wings, in waiting for the new system is now coming. It's going to get a spotlight appearance where it's a has a bit of Midas feel about it. It has a messianic moment. Um, and and gold is in that same spotlight as well, but has already really, really run. So as gold maybe rests, I think maybe a little bit of the spot will fall on, uh, crypto. Um, and of course, the Pavlovian response of running into equities is still there. But, uh, it's it's the wrong one. It's the outdated. You're coming out in your 80s fashion; you're wearing your leg warmers and going to Jane Fonda classes if you're still rushing into equities right now. That's my take because the PE, if you look at the market caps of the US relative to the rest of the world, my net opinion is those relative market caps are going to come chronically down in America, and you're going to see other market caps. I see indices going up in emerging markets. I see it in Singapore. I see it in other capital formation nations. America is going to lose market cap to the rest of the world in equity. So I think there'll be a geographical flow if we're just staying in equities. There's going to be a geographical flow away from the US still because of the the the tar. You can only scare people like they did with the tariff tantrum once, and trust is eroded. They did long-term damage on trust there. Fool me once.
Right. No, absolutely. Ray Dalio, $320 million Bridgewater investment into gold. What do you make of that?
Ray's consistent, actually, in fairness to him. I knock a lot of these big billionaire heroes, um, for their lack of consistency. And I'm going to throw—I'm going to add you a Warren Buffett in there as well to your question. Ray Dalio at least is consistent, and he's buying a reserve asset, uh, and he's very concerned about the bond reserve asset that's finished its 40-year, um, period of being a reserve asset. So, I think he's consistent. Warren Buffett, uh, is stepping down, and he's chosen this year, and he spoke very—the the words. This is Captain America who said, "You won the lottery by being born in America." This guy has never been a bigger nationalist and patriot in terms of all his financial commentary ever. And he's stepping down, and he's admitting that his success is likely to be more internationalist. And he's expressed concerns about this the state and valuation of the dollar. And he's also made comments about the trade deficit and the overall, uh, debt levels. So you're you're talking about a man who's signing off more pessimistically than he's ever been by a multiple of about 10 times. So for your Ray Dalio, I think he's doing exactly what he sees. And I think he's right. And Warren Buffett is no longer wants to be the guy running Berkshire and, uh, investing offshore and saying America sucks. He never wants to be that guy. Who knows? He he might become very unpopular and get tax audits if he did it. He's leaving it to his successor to, uh, set a new vision and, uh, pursue a new path.
Francis, we're here at the Gold Mesa, of course, and you're giving a talk tomorrow, and I just really want to recap, you know, taking away a little bit what you want the investor to take away from your presentation. It's called Positioning for the Death of the Hedgeimon, the US Debt Based Collapse. We sort of talked about a lot of the topics here already, but what is something that you want the investors, if they walk out here tomorrow afternoon at 5:00 p.m., what do you want them to take away?
The gravitas of this is far larger than people seem to realize. It It feels like everybody is a zombie. It's kind of like I'm saying a RTOR scale 10 earthquake is going to hit the entire planet, and everybody's going, "Yeah, okay. Uh, what time's we going down to the pub?" Um, it's it's far greater scale. It's the foundation of finance, debt markets. And the debt markets universally in the western nations, uh, with the possible exception of, uh, the Swiss as I've mentioned already, are in a a chronic state of revaluation. The rates going up. Everybody thinks there's rate cuts coming. They don't realize the Fed doesn't control that if there isn't the demand for the bonds. You can't price something, uh, at a price nobody wants it at. Uh, and that's the problem. And they know that markets in the end eventually get to say, and at the moment they're talking, and people don't want bonds. Not only that, Americans themselves are positioning short on American debt. If the debt markets are going to fail, everything that is leveraged, everything that has any form of leverage, and you'll be shocked how many things that touches—housing, cars, everything you buy, stores—it's going to collapse. Retail, uh, you're going to have a right sizing of the demand curve once debt, uh, gets devalued, and this is huge. This is global depression material. That's where we at. And at the same time, there's a search for a reserve asset that's not going to collapse like debt. It's a macro bull market, uh, for precious metals. And I can't be more ardent about that. And as what everybody else also doesn't understand is when debt collapses, the buying power of the currency falls with it in the end. So they take turns, left, right. We've had a period where the debt collapsed 45%. We were short the TLT from 2020. Then you get, uh, the dollar devaluation. You see how they they are alternating. Eventually when you get to that convexity, they collapse together. It is such a key moment, and everybody needs to understand finance is about to become the most important part of your world. Uh, or you just going to be hit by the tsunami, and you're never going to know what hit you.
No, I I didn't ask you earlier, but I should have asked like when do you expect the Fed to cut? Market expects September, by the way. I don't think they're going to be able to cut. Uh, I think the long end continues to do what that does. Uh, I think you're going to have more Trump pal Mark 2 moments. If they do cut, it would be incredibly small. They may have to reverse it very shortly thereafter. Um, I they don't have the room to move that everybody thinks they do. They they cannot manage by decree. Somebody has to buy it. And if no one is there to buy it, they'll have to buy it themselves. So if they cut, they know they're going to be they saying, "Well, we'll be now the buyer. They're going to have to be that buyer." Uh, and I don't think, uh, I don't think they can do it.
Francie, I could talk with you for hours, but you you just put one last question into my head. So I I forgot what this the acronym stands for, but Andy Sheckman brought that up in our conversation the other day. It's it's a system. It's a funding tool by the Fed to actually buy treasuries. Yeah. And he mentioned that they've just bought $22 billion worth of treasuries. What do you make of that? Is that out of the norm? Like that's more of the question. Like they're always there, but is that out of the norm?
So the interesting point on when we talk about treasuries is everybody realizes the market cap of debt is massive. You I had someone—I don't even think people can quantify it, but you've had a number of 330 trillion being thrown around recently for all the world's debt. 400 was a number I heard as well. So I'm not going to stick my name to any number, but let's just say 300 to 400, maybe it's 500, who knows? The point of the matter is such a large market cap, but everyone assumes by that that it's incredibly liquid market. And unfortunately, I'm here to tell you that it isn't. It's almost like, uh, a crypto token that is being managed to have a very—somebody owns 95% of it, and he's buying the price up, and the rest of the 5%, but there's actually no liquidity. There's been a number of gaps when I look at the 10-year on it when people have tried to sell. There's been some real sudden fear moves. There is not a big developed, uh, stack bid stack underneath that, and the Fed has to provide that liquidity when no one is buying it. Even at today's rates, so your question regarding when cut, I'm asking you when long—when does it have to go up? The Fed is already having to provide buyside liquidity at current interest rates. If they cut, how much more buyside liquidity to push the asset up even higher are they going to have to provide? They're going to have to turn into toxic bank with a bottomless pit of buying and being the bag holder on the entire debt ponzi. If they prepared to do that, they can cut. They're already having to do it now. You just told me about it, and I know I saw the same things as you. So that means they are the liquidity provider to a market that's not supporting itself under its own weight. What does that tell you? Debt based collapse. Like I start every interview, debt based collapse, long-term rates up. Debt based collapse. And on that note, we're going to end the interview as well.
Perfect. Francis, it's great pleasure to have you here in Frankfurt. I always enjoy your conversations through these microphones. It's even more awesome to listen to you. Actually love it. Um, where can we send our audience?
Well, first of all, great audio equipment investment. It's good to hear your voice as well. The resonance is amazing. So, the Market Sniper YouTube channel. We also cover the crypto, uh, market, the Crypto Sniper, and of course on X under the same name. Our goal, build wealth in reset times. We're in it, and it's about to get parabolic or cascade to the downside depending on which side you're on. It's going to be a totally polarizing event. Some people are going to get significantly wealthier out of this, but the majority are going to be impoverished by it. I really wish for everybody not to be caught on the wrong side. So, build wealth, preserve wealth, and secure freedoms. Those are our core tenants. And if that's, uh, things that are of value to you, you might enjoy the Market Sniper channel.
Fantastic. Francis, thank you so much for coming out. Everybody else, thank you so much for tuning in here to So Financially from the floor of the Deutsche Go Messa. Tremendously appreciate the support of the recent months. Hit that like and subscribe button. It helps us out tremendously, and it's a free way to support us. Thank you so much. We'll be back with lots more. Take care.