Transcription
Good morning. Hey guys, nice to see you. Before we start off, I will just read out a disclaimer here because this is important that you understand that you know what I say here is not recommendation or advice, uh, financial advice in any shape or form. So before we begin here, let please note that this webinar does not constitute financial advice. Everything discussed reflects only our my personal opinions on the topic at at hand. Always conduct your own research and consult a professional before making any financial decisions. Participation is voluntary and the information provided is intended for educational and discussion purposes only.
Today's session will be last approximately 45 minutes. I'll see how long I'll do the presentation and then there will be uh questions and answers. You can ask your questions uh here now and then I'll start to take a look at it when I've done a short presentation. And if you like to ask the question then please use the space at the top of the screen and to send it directly to us. And as I said please note that this talk will be recorded and sent to you directly to your inbox as well.
Um, okay. They say that nobody rings a bell at the top and I don't ring a bell right now. But what I think I want to do is just to try to, you know, make a make make it clear to people where we stand because I think um, you know, on a daily basis, people can get lost in this the narrative and the talks of of, you know, various people and saying, "Oh, yeah, but this time's changed or things are different." But really, it's not really the reality is that things are not different from what we've seen before. And uh I just want to show a few things here and then we can put the the discuss let the discussion run based on that.
Um so I want to get into what we have here which is the oh it just puts right in the top of things here. I'll put it over here. um where we have the different uh bubbles that we have had during um during the times where actually there's one missing here but we had the tulip mania in the in the Netherlands in the 1630s and people say yeah why do we talk about tulips because of psychology this is really about psychology by the end of the day and people's the craziness the madness of of you know crowds is what is importance when it comes to to uh to bubbles uh so the tulip crisis was when when the tulips went into fashion in back in the Netherlands and they started to move up and as you can see it was not something that just last for a day or two. This was something that it went on for a few years and at some point it it reached the pri one bulb of tulip just one toilet bulb just uh reached the price of uh the cost of a house. So just to explain to to tell something about the mania of that and of course at some point it just collapsed and people lost a lot of money there.
Then we had the railway mania back in the um just turn this down again. Back in the 1840s uh which was when the the the new technology came out. We had that you know steam engine came out and a lot of things you know would change the world would be changed because of the steam engine and because of the locomotive and other uh inventories or sorry um inventions that could be based on that. And again you had a huge bubble developing and actually uh thousands of companies started to emerge and the parliament was behind it and and again uh people because of this technology here people just thought okay there is a guarantee that I'm going to you know earn money on this because there's a new technology what is it there not you not to like and again we saw a bubble developing and we saw it burst busting or burst in 1847 and a lot of people lost money and also um the UK went into a recession.
And then uh we we saw in the roaring 20s also we saw electricification, we saw automobiles, we saw um radios coming out. I mean again technologies that would revolutionize the world. No doubt about it. And again we saw people just going crazy about that and just thinking you know this new technology is just going to send us to yeah to the moon. and they actually did. Well, but but it's it's not the same as it's a guaranteed uh you know, investment. You you can lose money. Uh because it's not like you can just say, "Oh, I you know, just because I invest into the some kind of radio uh business back then, it would you know, you would end up earning money because first of all, the business could be the wrong one and and secondly, maybe it was already in to a higher price." And people there, they they started to buy in with just 10% down and 90% was borrowed money. And we know how that went. We had one of the largest busts back then.
And then we had the dotcom boss uh bubble as well 2000 and again we heard you know how this time is different. The narrative was new economy and if you don't get it uh then it's because you really don't understand it because it's like you know this is the this is the ship. Uh and you saw how uh businesses were uh the the darlings of of of Wall Street, the darlings of the media. Uh you have webband, you had uh you have pets uh pets food or pets pets.com or petsoot.com. You had all of these and I think it was 16 or 18 you have to give forgive me on the number there. 16 or 18 of these uhs that were on I think it was in the Super Bowl in 2000 or it was 1999. Forgive me on the the years here but this this is a true story. And I think was it 18 or 16 of those that act that went bust by the end of the year. Uh that all been commercialled you know the big commercials on on Super Bowl that year. So that things are exploding and people are just talking about it and it it's you know consuming everything is not the same as that it's going to create wealth that is going to create wealth for you in the investment you're in.
So I just want to you know f you know say that to you because you can't you you these bubbles are something that we see again and again and we also have the South Sea bubble here which I haven't put on here which was also a a massive bubble which was in the 1740s I think. So bubbles occur and again and again and very often there is a technology coming out like in the roaring 20s like in the railway mania like in the com where that is the driver of things and people thinking this is a sure investment because new technology and this is what we see again now and this is what I want to be so uh that is why I'm so critical uh when when I you know see my my my tweets on on X because people simply stop thinking and when we look at something like this with the with This is the NASDAQ we have here and we can see how we're up 21 to 22 times times not not 100% or this is 221 sorry 21 to 22 times we're up so 2200% in that amount of years I know in these crypto days that sounds like oh yeah that's just a you know two three days of of rally or something like that it's it's because you know crypto is just going insane but this is actually quite unprecedented.
And when we look at the market cap to GDP and we take crypto into it because crypto is also a risk asset. Then we have a market cap to GDP which is 226% at this point. It was 86 and we had the big bubble in in 1929. It was 136 in 2000 and it was 107 in 2007. This was considered an an insane bubble and and now we are at you know we're working on getting up to the double of that size. So and and if you look then at and this is the NASDAQ and if you look at NASDAQ also when you look at it from a um even if you adjust it for the M2 and say yeah but all the money printing and all that well even if you look at it in that kind of sh in that kind of perspective you can see now that we are actually looking at a bigger bubble than we have seen before.
And when we look at this and now we had um we had Nvidia coming out with earnings yesterday and barely just just brought it home the earnings expectations. But look at this. This was considered a crazy chart in the days. This is Cisco 2000. It was the greatest bubble asset in the world. It was the highest valued company at that time. And look at what we have now with Nvidia. It's up 450,000% and that's probably from around down here. So let's say over the next 10 10 10 years. This is not a sustainable development. I just want to say I have nothing against Nvidia or anything but this is not a sustainable development. It takes up I think 10% now of the S&P. It is insane. We are in the largest financial bubble that we have ever seen.
And this is not just about tech stocks. This is also when we get into housing. And I think there's a lot of people that actually do not understand that we had also a housing bubble at this time. And this is not my chart. This is the how from reventure consulting. So always pray uh you know credit where credit is due. And if you look at the here US home price history now 1890 to 2025, you can see now that we actually up here on the home price index on the inflation adjusted home prices, you know, way above where we were in 2006. So it's not just a matter of this just not not just a tech story here. It's a tech and a housing bubble we're in. That is that's why I call this the 1999 meets bubble of 2007 because you actually have these two components and there was one thing that the economy does not like. That's when a housing bubble bursts because when the housing bubble burst that's when you get the largest inflations that's what we saw in 2007 that was a that when that burst then you'll have a lot of balance sheets that goes uh wrong in the financial sector and you'll see a lot of money just you know falling into that that did not happen in two happened in 2001. There you actually saw that the recession was actually more shallow because you did not have a housing crisis. This time around we have both. We have the largest financial bubble because we have a housing bubble and we have a tech bubble. And then I'll say as well we also have a um a crypto bubble.
There's nobody that can tell me and I I you know I make a lot of enemies when I say this that and this is again back to what we've seen before when you are standing in the midst of it people will not like what you talk when if you said oh the coms they you know they are air oh Henrik it's not it's not about what they they earn it's about how much they spend on marketing you don't understand that this is a new economy that was what we said 25 years ago now we say oh Henrik it's because you don't understand Bitcoin and you don't understand that this is a technology ology this is you know this is shifting you you you don't understand bitcoin I understand bitcoin it's not that difficult I can tell you it's not that difficult and people say oh yeah but there is a you understand that there is a fixed supply yes I get that but that's not the same as it can have an unlimited uh you know price in terms of you know yeah you can can the price on it can be just going up forever so we are in a what what looks like a gigantic bubble that can be developing still for some months to.
And if we look at it here, we see how into the final phases of 2017, 2021, here we see how it actually just explodes higher. Here we were around 750 million. Here we were around 3 trillion. And now I think we can reach 9 or even 12 trillion on crypto. It does not tell us that it's actually not a bubble. It just tells us that it's insane. And and and if you look at it technically, this actually tells us that we we should be very careful we start to get up there. I'm ex very bullish these things right now and I say there is going to be an all season all that we're going to see it. But come the time where I think the bubble that the the the dollar is starting to to rise then I think you should you need to be very careful because we have simply the needle that will prick that bubble. Uh we it's going to to pop it and it's going to be really bad. And when these things are starting to unfold, the housing bubble and the tech bubble and the crypto bubble, it's going to be bad.
So, I really just want to um you know, enlighten you on this or tell you about this and then say that every time somebody tells you that this time is different, you can go back in back in history and the financial graveyard is filled with people that said this time is different. It is not. There is a technology the ledger the blockchain and all these things will make some there'll be some fantastic businesses coming out of that but just like in the com 99% of them will will will not be here and they will also go back go through a horrific market decline. If I see it right I think there's a pretty good chance that we could see a 75 to 80 maybe 85% decline. We saw that in the financial sorry in the dotcom days and this time it's going to be bigger because of this. It's a double bubble so to speak or triple bubble. So be careful. And that's what I want to say with this. And now I actually want to stop and I want to take some questions and then uh yeah, let's see where that takes us.
All right, let me just see if I can get the questions out all here together. Hang on for one second. That was not what I needed to press. The Q&A is right there. All right, I'll go through it. Um, isn't the timing of such bubbles erratic? Unknown beforehand, eg. The toilet bubble lasted for 16 years. I don't think it lasted that long. Actually, it lasted four years or something like that. Uh, no way to predict them when it's finally over. And secondly, what makes you so sure that the past safe haven assets, i.e. the US dollar and US government bonds will perform in this downturn. Could it be the case that this bubble bursting fully erodes the confidence in the US dollar bond this time?
Fantastic questions uh Sasha and I want to say first of all what pops the bubble is recession and the recession is based on business cycles and that's why I look I I start with the business cycles. So when I look at my business cycles and I can see that we are closing in on getting a crossover of the coincident indicators that I sell which is the real economy. We'll see if there is some confirmation here in September and we start to see that the imminent recession indicators and those are related to yields to yield spreads to credit spreads and so on starts to to rise then I can tell you that we may not know it but there are indications of it. How do you know it's going to rain when you go outside and the dark the sky is all dark and you can see that there are you know thunders in the in the uh in the in the in the distance. You don't know. It may, but if there's there are enough indications, you probably want to get ready for it and you put you you bring that umbrella with you or you maybe even stay in stay at home. So, it's not erratic and there are levels that will be reached and this is where Fibonacci and the likes can help you also. But the recession is going to pop this bubble.
And there's another thing and that's the dollar. And you say, "Yeah, but you don't know." You can there's technical ways of looking at things where you can actually say the dollar is going to have a massive rally and I can tell you that if the dollar reaches 105 the Dixie I mean or 110 or more which I think it will I tell that will be a massive havoc in cryptoland and in and and other places. So it's it's honestly I back to your question you can look at look at it and there are ways of actually getting in under this. We never know obviously that we don't have a crystal ball but we have indications. It's like we never know why the butler if if the butler is the the murderer but if you have enough indications you can actually with a certain amount of uh probability say that this is going to happen. So yeah I don't know the day or anything like that but I can say there is a time for me to say okay this is getting closer now. I'm not out of the risk asset, but I'm just saying it's getting closer and it will be a very bad day when it starts to develop.
Uh, let me just also I think it's actually a good question also that the confidence in the US dollars and the bonds this time. Good question also because you may see that all of that could be true and you can see also the downgrade of the US debt. That is actually exactly as you put it something that could the confidence can be lost but it's always it's always a relative thing and if you look to the rest of the world where would you rather put your money I would probably say there's nothing no place in Asia no you know it's not anything against any Asian countries at all there's I mean there's nothing maybe the European you know EU but even there I live there I tell you there will be this you know there are so many um asymmetric uh s uh structures that are are wrong with the euro that again it'll be a relative game between the euro and the dollar and I will say that the dollar is still the cleanest shirt also when things are starting to unfold and so much money is already in the US dollar the debt is there and with if that needs to be restructured you will have to see that it needs to go through the dollar which means that you have to you know close that loan for the re refinancing or restructuring or the defaulting of it. So all of this will require a you know dollars. That's why the dollar is going to spike and I think it's also putting we're seeing that also in the structure of the technical structure.
Um, honestly uh there's some question here like that. Okay. Uh some your forecast sometimes concise with David Hunters which I he doesn't like. Is it because you're right at similar conclusions by different methods? I actually invited him. I said to him, let's let's look at I think it's interesting that we do and all of you guys here and especially those that are our clients and so on, you know how I do my stuff. I mean, I it's out there. Uh so I've never seen a chart from his side, but you know, why don't we just talk instead of this and but I you know, he'd rather just say that I steal everything from him. But I I think I'm I'm doing a pretty good stealing than that and and even putting it up uh for our clients to see then. Anyway, I don't know how he he does it. I haven't actually, you know, seen any of his uh anything of from him in a long time and he has also blocked me and so on. But I I don't know how he does it and it would be interesting to see from a academic point of view to simply see how how could we possibly come up with the same kind of uh you know uh direction of things and levels.
Um, okay, as mentioned yesterday X I would like to get a better understanding of why you believe EV technicals aside gold will be dragged down with shares to begin with. Um because if you think about it, as I just said, if you're going to have a housing crisis, you you will see that there will be defaults and defaults will bring the dollar off the the Dixie up to 120 around that level. And if I'm right on that, uh then you're going to see precious metals actually declining. And everybody say, "Yeah, but then the capital rotating to gold." Hey, listen. The capital will evaporate. The the thing that people don't understand is that it's not like fixed size of capital and then it rotates around. It's not like that. Majority of what's in crypto will be lost. I mean there will be more losers than there are winners in crypto by far. So it's not like that you know capital is just circling around. The same goes for stocks. There will be a lot of losers there. And you will see that you know people thinking that they have a portfolio of a certain size will all of a sudden have half the size. And that's why you know it's not just about that and when you you need liquidity and there was a situation here not so a few months ago where there was rumors said there was a fin a hedge fund actually almost going under and they had to sell out whatever they could to to just stay afloat and it seemed like gold was also one of the things they sold out and I just say when this sovereign debt crisis comes up and I think we could see that remember Greece that we saved in Europe has now a way higher debt than it hasn't had in two 2012 health and that goes for the rest of the world as well. So we haven't solved anything and that means that there will be liquidity shortages. There will be and that's in the dollar as I see it and that's why I think but do I think the gold is as important? Hell yeah. I think gold is more important than any crypto you can come up with even bitcoin also bitcoin especially bitcoin. So it is gold will have it shining day and it already had you can say but you have not seen silver and gold miners and so on go with it and I think you're going to see that they will all sell off into that deflationary part and it's going to be really bad. So I see.
All right, um, what else? Asset allocation. I can't talk about that. Would you please look at Nifty India? No, I can't do Henrik have USD already bottomed. Um, I don't think it has. I think it's in a bottoming phase. And that's quite different. And that's where people say, "Oh no, now it drops. It comes up. Oh, it drops. Oh, it comes up." And it's like it's to to bring most people on board on the bearish side. And when we have the screaming of the dollar is collapsing then you know it's probably when the time but I don't think the bottom is here yet.
Um, do you still still believe an old sales will occur given the deteriorating economy? Yeah. Yeah. because you have a you have a setup where there is the Bitcoin dominance index and you see that that is actually putting in what is a very very large uh top and a very large top and that will mean that Bitcoin will uh will will decline versus Ethereum and the rest of the pack and that everything else being equal mean that you're going to have a fantastic um fantastic old season but I know you know just think about 3 4 months ago before Ethereum started to move everybody had you know but were were saying oh Ethereum is not going to stat it's out you know don't think about it anymore. Now everybody's saying, "Oh, it's all about Ethereum." And soon actually now we can start to see Solana moving and it will probably not be far from seeing, oh, Solana is the And you know, it it's it's like that that's that's the that's the rotation that's going on and the rest is psychology.
Do you see the Euro surviving the bust? Yeah, I do see the Euro surviving the bust. uh I think there can be some asymmetry uh in the Euro zone which will be very difficult to handle where you see that there will be the northern part and the southern part and the uh and you'll have to have that the northern part will actually at one point accept the uh the debt of the uh of the southern part be in order to actually you know uh to to to have the euro to exist. The problem with the urine is that there's really no valid in it. And uh so so the way you normally would have a currency uh like that would be that the uh if there are starting to be problems in one area you see that there will be some you know transferral of money to that we don't transfer money we don't you know give the money we we there'll be the Germany you know Germany Greece let's put it up like that you'll see that Germany lend Greece money and that's not enough. That's that's just you know pushing it down the road of kicking the can.
If you are in a tech stock uh and own a home and it's not feasible to sell either type of asset in your currency trade, how would the normal investor try to protect themselves for a one to two year year frame uh time frame? I don't know. I mean, if you're in tech stock and you and it's going to decline, I don't know how you're going to, you know, you you have to figure out to if it declines to 85% you you'll be going down with it, I think.
Is it safe to invest in USD stable coins during the bust or should we just hold USD in uh in the bank accounts? You know, everything that has to do with crypto or any crypto related at that point when that starts. I mean, it's about the dollar. It's about the dollar. This is liquidity. This is about people, you know, buying. You cannot buy anything with the rest of it. You may be in this world where we live in a bubble, but it will not be the same at the moment when the bus goes. So, I would not be holding anything like that.
Lyn Alton and others have said money money is lost preparing for recession and during more money is lost than preparing for recession than during recessions. How should we heding a lowering risk considering the bubble could continue inflating for 6 12 and 18 months. You know you're right Ross but remember I did not say in 22 that a recession was coming. I yeah I said it was I said we're going to see the recession is not here. Uh and in 22 everybody thought it was when we had the inflation and we had the decline in the markets. I said no. go back in my tweets 23 when we had the Silicon Bank uh also come declining or or having a bust uh having to be saved. Uh we also heard people say oh now we have a bank. I said no there's nothing you know it's going to go much higher 25 Q1 everybody oh even Black Rock CEO said oh the recession may be here I said no this is where the business cycle works so when Lenol and others are talking about that that's because they don't follow business cycles so they they have to wait and see based on what's coming out in terms of other you know whatever indicators but the business cycles are telling us where we are in the cycle and that's why they are extremely important for for the uh for investment So, I'm I'm not starting to to to to um to hedge or lowering risk just yet. Remember, I'm very long risk at this point, but I know what is coming and I can see I know what I'm looking at in terms of what what indicators need to start flashing. Uh um
What does he focus on making money before the blowoff top? Why do the charts say that all are supposed to be in an explosive wave three or five? As I said, you know, it is again all performance shows zero momentum per Swissb right now. Right now, remember the rotation as I said Ethereum, Solana and the likes and then the comps down the road.
How about the financial sector? Is that in a worse shape since uh uh shape than the 20 worse shape than 2008? Um I don't think the US is necessarily in a worse shape. The problem is that when you have multiple bubbles going on that it is going to hit the banks. So especially that's why the biggest crisis are when you have a you know have recessions where you have a decline in the housing market and currently if you look at the NAHB and so on you look at affordability and so on. The housing market is in really bad state. So if people start to lose their job, there's a lot of people that will have to sell their homes and they'll probably not even be able to pay back their mortgages. So yeah, the financial sector will get in a bad state. You don't you're not in a bad state right now with this financial sector. But you have to ask what about their customers and we're talking about here 15.6% in a new survey of US customers are not capable of bringing of of bringing putting food on their table have severe problems in bringing you know food on the table. That is a big number. It's bigger than into the financial crisis. So, so the it's not about if they the financial sector is in in trouble right now. They will get in trouble. That's it.
Where do you go the next five years? I see it down a lot uh into the into the deflation and then I see the Fed and Banaki coming out with the the guns and then I think they're going to start and see stackflation and I think they uh we're going to see gold explode. And if you ask me 10 years from now, I would say I could see gold at $35,000. uh announce I I could easily see that I have there something.
Okay. Uh can we see an update on Mara? That's a little too specific here. How long and how many steps take to crash? Well, you know, you just look just look at the cris the the the decline you had in 2001. I mean, it was pretty fast, right? So when things are starting to unfold, you know, it's just in fear grips. We are only what is it now? It's August. Remember in April, see how fast fear just got hold of people and we were only down 20 some%. Think of it if it's down 30%. And think of it if the dollar is just going vertical all of a sudden if I get it right. So I think that it's um you know it will go really it can go fast really fast. Um yeah.
So uh with del globalization pushing the price of goods and having inflationary pressures, do you still see interest rates being slashed during a recession? Where are the inflationary pressures? I know people talk about it, but there are no inflationary pressures. The inflationary pressures were there in 21 and 22. Right now you're seeing inflation getting pushed lower and you're actually seeing that inflation is lower than it was going into the 2007 situation and 8 and in 2001 as well. So there's no inflationary pressures. 2.7 is not inflationary pressure at all. So there's no inflation pressures. I I just want to put that out. It's simply because inflation is a lagging indicator on lacking the the business cycle. So when the business cycle rolls over, you'll see inflation rolling over. And right now you're starting to see the business cycle rolling over. So inflation comes later. And what you see right now for inflation is what the business what the business cycle was doing uh three, five, six months ago. So that's why people are all over like you know there's inflationary pressures, there are no inflationary pressures actually on the contrary look to housing uh rental you know does not look good. So I don't uh so so this about that rates being slashed they get crushed. Remember it's not the Fed who sets rates. It's not the Fed follows the 2-year yield and and the the 10 year and the 30-year they follow demand in the market. So that we we have this notion, oh the Fed. No, it's not. The Fed really just followed. Go check it. Every time the 2-year yield fall drops in into before reset, you see the Fed follows.
Do you have any timing and indication of when the bubble will burst? How long do you think this could turn out this could downturn could last? Um well there are yeah I think there are you know indications that we are not far off. Uh I said in April that we will have an extreme rally and a V-shaped recovery and that is what we have had and we are now getting to levels where I think there are two ways out of this. That is that we have a a summer adult room uh which is not not really coming to be summer some adult room so much longer because summer's almost over here um done here in Denmark at least. But um so but probably a kind of a a push lower fast which could come by the next FOMC. Maybe they spook the markets. Maybe they they do not deliver the the cut we want. But I think that it's a um it's a risk that we see a fast decline before we head into the to the real and the last high. I'm a little in doubt about this. Where are we going to see? because we also know that when the Fed starts to hike, sorry, cut, when they start to cut, we are closing in on the market top. And that is really what I think we could be uh getting into here. Now, what is the normal length of the business cycle? There's not a normal length. Um there's not one size like that. Um but there are certain phases that you go through with that and there are these are very recognizable. So you can say that. But there's one thing that is for certain and that is that the easy money policies and all the BS that they have been putting on us from the from the Fed side and from the central banker side that we um you can just pour money on everything and then you're going to you know make it all fantastic. That is has extended the business cycle. But the problem is the problem is simply that they may have blown the bubble even bigger and into more areas but that does not mean that they can simply prevent a recession and when it goes then it goes much bigger and this was actually also the point of Ludik Misa is that there's only one way out of a uh a boom in the economy which is brought been brought brought about by a credit expansion and that is either by a voluntary pop of the bubble or where the total financial system comes into danger and I'm saying this time around that's where I also had another um I had another uh article on Substack also where you could see that we are in with over the last 100 years we have had four times when the S&P and gold ratio so SPX over gold has broken lower in a significant way that was 1929 it was 1971 it was 2000 and it's Now 1929 it was a huge bubble. So it's really the the trust of the whole of the of of you know stocks and so on the financial market you could say. Then in 1971 it was kind little different because that was not the bubble stock market topping out like that. It was really Nixon who took the dollar the the gold convertability off the dollar gold convertability off and that actually questioned the entire financial system. And then you had 2000 where we were back to like in in 1929 it was like the stock market but the financial system kind of you know were now I would say we are closer to the point where we're seeing actually both of these again we have a crazy stock market top and we have a stock market bubble sorry and we may also have uh at least serious doubts on the on the on the on the financial system. So I think we can be we should be very very um there's you know a lot of indications that we could see um uh yeah a very big uh bubble here bursting and also be much worse. Let me just get some water.
See then they have the I I love the next question here. How does this crash prediction correlate with global M2 rising and further rises predictions for next year? Let me just show you how it actually correlates because this is the greatest uh I mean there is only this thing also you know don't fight the Fed where it's actually you should fight the Fed every time the Fed goes one thing you should actually you know go opposite but let me just show you this one actually because I think it's quite interesting to see uh I think let me just see here share um now you tell me ah shoot hang on that's Uh let's see we have it here something liquidity liquidity is not enough. Uh I can't find it. I just closed it down in my eagerness. Okay. But what I want to show you then let me see. I can find it here then. I think it's here as well. here. So, what you're saying is that why would I think markets can crash when liquidity goes up? Well, because I've seen it before. Liquidity does not drive the business cycle. And there was a a chart also by uh Steno Research or whatever it's called and they showed exactly the same and trying to say that because liquidity is moving up you're going to see the market can't crash. You can't see the recession but they actually showed the the opposite and what you see is that into the into the com you saw liquidity moving up and this was quite strong back then. You have to understand that these are now much higher levels. This is M2. Then into the financial crash you saw this. How could we see this? Is that what you're asking? Well, because we have seen it before because liquidity cannot counter a a um business cycle rollover. So when the business cycles roll over, it does not matter how much liquidity you put in it. And there's actually a very uh there's also very famous chart going around on X showing exactly the same. And people say, "Oh, but the when the liquidity bottoms out, then you have a fantastic bull market." Then then you see how liquidity bottoms in 2008 and then I said hey don't you understand in 2008 and and 9 was actually a very bad year. So in in terms of the stock market at least until March in 2009. So it goes very well hand in hand with that. Just check it. I mean it's all right out there.
Would will you buy BTC at the bottom of the crash or only gold? Uh I will have to see what Bitcoin does because I don't think people really understands that um that we are in a situation where uh Bitcoin could crash to much you know deeper levels than anybody has seen before. This is not an ordinary cycle. We haven't seen Bitcoin hasn't met a real recession. It hasn't met anything near what we're going to could see at this time. And if we really see that the economy rolls over at this point and the dollar hits 2020 120 on the Dixie, I can tell you that we're not going to see uh that that Bitcoin is going to do well. But let's see. I know that our you know we have a framework and that framework has been quite fantastic in actually making sure that our you know clients and ourselves are out of Bitcoin at the times and also getting us back in again. So it's about understanding that cycle behavior and I think that is that is what I'll you know see I'll have to see how deep it goes but there will be a lot of uh yeah a lot of uh um havoc uh in the in in crypto market and also in Bitcoin.
Um, all right what else? What else? What else? Uh do you see Bitcoin moving higher this year? Are we already moving on all season? Well, I I think no, Bitcoin doesn't move top. I don't think Bitcoin is top just yet. And uh we our system actually took us out uh into this uh decline as well. Um and it's uh not really taking us in just yet. Uh but it will uh it will when it does when and we will have to see when where the final top will be. There is this I think it can go with the Bitcoin cycle that we have and you know that that that can be also when we potentially see the Bitcoin top. So, I think there's one or two more tops coming to it. And I still think that markets could go much more uh you know, 40 50% higher from here uh without a problem.
Um, okay, let's see. What else do we got? Uh how long is going to take till the next bare market? 18 or 30? I have I as as I said my my my crystal ball it doesn't work right now. So I I don't know. I have that's where I have to turn to the to the business cycles and and and again those are the ones that will give us the the the way we we go and uh and if we follow that well then we can you can also make you know better returns over the long time frame.
Okay. Uh will we print more money than co how long does it take for rec housing to to recover housing prices then? I I I think because we will probably see that there will be a need for real assets and I think you're going to set off a commodity boom after this. Why? Because I think the money that has been now been circulating and everything else uh will need to find you know proper use and I think if we see some kind of speculation uh because of what the Fed is trying to do then I think it'll be a uh there will be a speculative bubble in uh commodity stalling and and that would also uh include uh housing. I think actually housing can can maybe may may take a dip. I don't necessarily think it's going to be as bad as in the financial crisis because we did have there uh also a lot of more speculation in housing as such. So even though it's a bigger bubble, I don't think the crash will be necessarily the same because people don't have you know three homes and and and five condos. So I think that is going to be soften the be cushioning the the fall a bit. But but I think over the long long time frame I think but you know housing houses can do quite well. So it may take a couple of years, three, four, five years and then you see things will be coming up again. So longtime housing will be good even with if we get inflation up and running at you know 3, four, 5%.
Uh, let me see what else we got. Yeah, how does this you said that um how do you do you have a view on quantum computing threat to BTC? No, I don't I don't I don't I'm not the right one to ask about that. That's a technical questions uh to that's that I'm not what do you think about emerging markets Brazil and China do you see a migration to rebound of that for the change of cycle see a migration to rebound of that uh not really understanding the question here but I how do I see the markets I I think you're going to see Brazil and China actually doing really well here you see emerging market actually that's also one of my expectations into this blowoff top that you'll see emerging markets actually doing really well but also getting to a really uh important top and if the dollar again everything is about the dollar and if the dollar turns into or hit you know 120 as I think think it will you're going to see those emerging markets getting crushed. Uh so I think this
will be a uh, yeah, it will be a good investment for the next few months, maybe. And then you'll see a very, you know, explosive investment, actually, even. And then you're going to see them come down quite strongly.
Um, okay, let's see what else we got. Uh, the Bitcoin poll base will get updated, uh, when any threat from quantum appears. Okay.
Uh, I totally agree with you. However, some macro comments is saying that the US government cannot afford a blow-off and will make everything in their power to avoid it and avoid a transfer of power to emerging countries. I mean, if it was that simple, if it only was that simple. It seems like, you know, some macroeconomists thinks that the US government is in charge. Just let me tell you that there have been many US governments over the years that have overseen quite severe recessions, and they have been able to do nothing about it. The Fed has been able to do nothing about it because when the first, the bricks, the domino starts to f- to to tumble, there's not much that can be done because it's a, you know, it's a momentum we're talking, and you know, uh, 8 trillion people, uh, or sorry, 8 billion people, 9 billion people are now on the globe that are starting to move in a certain way, not spending, and so on and so forth. So it's not like it's, it's not something that the US, just or any president can do. And I just want to say here that I think Trump is going to own this crisis, but he's not the one that is the culprit. The culprit by the end of the day here are the central banks that thought they could print money and print wealth, and that is the problem. And I hope history will understand that and do at some point.
Okay, guys, let's take three more and then I think we'll call it a day. Uh, just to play devil's advocate. Okay, on the classic, this time is different argument. Is there a plausible case that the unprecedented concentration of balance sheet strength and capital deployment by today's largest institutions could extend this cycle far longer than prior bubbles? Treasuries as a stabilizer, could persistent treasury demand, direct and indirect, provide enough structural support, blah, blah, blah, asset management flywheels with flip with, uh, with, with firms like BlackRock, blah, blah, blah. All this guys, it's about Mrs. Johnson. Forget BlackRock, forget Wall Street. This is about Mrs. Johnson. There are, there are two components in, in the economy today. There are the financial markets, and then there is the real economy. The financial markets, they come up with all these three-letter abbreviations and saying, "Oh, now do we do this and, you know, QE and whatever all this, and this is going to change the day." No, it's not. It's not. It's about Mrs. Johnson actually going out there, taking a house loan, a mortgage loan, and actually can see herself in that being able to pay her bills. And if she cannot, then all of a sudden there will be 200, 300 million Americans that will be in trouble. There may be one or two or five or 10 million that are living, you know, the days of, you know, the fantastic days and, you know, just flying. That is not going to save the economy, and it's not going to save the financial world. The financial worlds keep believing in that, but all this is BS talk. You've had already the extension of this. You have had the extension when we, when we see the QE coming on again and again and again. And now I want to say it. This time is different. Why? Because we have seen inflation. We have seen inflation going up from nowhere, from from low levels. And whatever the Fed did, there was no inflation until the geniuses they started stimulating into a supply crisis. I mean, at least in, in Copenhagen, at the economic study, you, we learned that supply and demand. And if the, the guys who are actually delivering the stuff are going home, and you then stimulate their demand, just giving everybody a stimulus check, well, then prices are going to go up. And they, they said, "Well, it's not going to go above two and a half, 3%." I think Yellen and Yellen said that. And then we had 9%. What happens with inflation is that it gets into the backbone of people. So people then get, oh, we actually can have inflation, and, and, and, and then they start to fear it because it's not good. It's not fun to have inflation, and you can see that the levels of the groceries that you buy there just risen, and they don't, they haven't come down again. So this about that all of a sudden, you know, everything will just be, you know, different, and because you have some financial institutions that may support this and that, and that will change the world again. It's 8, 9 billion people going in one direction, and that is not something that some, you know, BlackRock or anything can go do anything against at all. You may hear financial for, you know, some economists talk like that. It's not the way it works. And this is the difference actually between real business cycles to understand the real economy and understand all the BS from the financial side, and the division between two is becoming bigger. This is the world that used to talk, and all these, this is the QE days, and now the liquidity, we can, we will have it. We will see it. We'll see whether the business cycle will turn, roll over, and we'll see whether the financial world and the QE and liquidity, as I call them, the liquidity testists, actually can do anything against it. I say they cannot. So it's not going to be, uh, different this time.
All right, guys, uh, how high can mortgage rates go post-bust? Well, you know, look at it. Look at the, what you saw in, into, we had a top, I think around the early 20s or something like that. And then we have a decline into, uh, the, what was it, 40s, 50s, and then you saw a rise into the 1780s. What we are at now, right now, is that we have coming out of the bottom of that, and we can see that mortgage rates can go much, much higher into the next few decades. So this is the, the, we in 2020, that was the point of bulker in 1981, where the inflation then was started to to to decline. And we're now in a situation that is quite the opposite, where we start to see it going up. So we can go, they can go a far way up. So at some point, not right now, I think it's about fixing those mortgage loans if you can't do that in your country, and then just, you know, ride that, uh, rate for, because the, the days of ever lower rates, yields is, is, are over. We're going to see a bust in them, but it, it's not going to to, um, to stay.
All right. Uh, I know we're at the top when people start physically threatening me for having a negative opinion. Yes, correct, Christian. I, I think you're right. We, we're not quite there yet. And I think it's, uh, we, but, but yeah, we are there. Uh, how do you stay in such a great shape? Is that to me? I don't know. I don't know. Four or five times training every week, and I'll go again tonight. So that's it. Oh, yeah, let's take this away. Can a massive spending on AI push off this coming recession? No. First of all, it AI is going to change the world. It's a new technology, as I said before, with the top, with the, with the, with the, the bubbles, uh, in previous times, and it's going to change the world, just like the locomotive, the, the steam engine, the, like radios, like cars, like, you know, electrification, like the, the internet, and all that has done, have done over the years. But it's not going to save the day. We are still at a, um, we're still at the highest, uh, we still have the greatest bubble we've ever seen. And we are, uh, and we will see that that is going to to to break and and and bust. And when it does that, AI can do nothing about it. We will see that it will actually, uh, be a solution for the future. Uh, but it's not going to change anything in terms of the short time for, for, for market. Uh, so, so that, there you have it. And especially when it's been already been bought up like it has. I mean, just look at Nvidia's stock. Uh, you know, it, it's, it's a crazy ride, right?
So, okay guys, I think that's it for today. Uh, we'll try to see if we can do more of these in the future. So, thank you very much, and, uh, well, um, have a good day. Happy trading, and take good care. Um, the bubble top is near, as I see it. It's a few months out. Thank you.