Transcription
Hello everybody. It's the funniest name for a video and, uh, well, we got to have fun with it. It's called Jail Stash. It's Sunday. Thank you all for coming and, uh, I nearly forgot to put my shirt on today. Very bizarre. Anyway, let's get into the story. Big thank you to Mazhat, TD, Shauny, KH, and everybody else. And, uh, today, this, uh, every week is very different. Today we will dig into a lot around TA trading, pair trading, what to do, retirement, what a difference a year makes, and so much more. Let's get into it. Uh, and thank you for coming. Let me see, toggle this around. Put myself down in the corner. Let's go. Jail stash. Not financial advice. And a big thank you to everybody on Patreon. All the questions come from Patreon, every single week. And a big thank you as well to the team that picks these questions. I don't pick them, they do.
So, first question is from digits. And, uh, the questions, by the way, are very astute this week. So proud of everybody because these questions also make me smarter. So, could the PMI number be a complimentary metric to the pair with the profit-taking model in the next bull? We don't know how long Bitcoin will run. Estimating from the chart in your video, 62.75 PMI was the average high of the previous two crypto bull runs, just like the PTM. Would it be wise to use PMI range with levels to layer out? And I want to be very clear, in 2023, my prediction was 119K for Bitcoin, but I also said openly, I have so little Bitcoin that I didn't want to sell it, and it's locked away so I can't even touch it. So it would have been difficult for me, but my plan was always to use a different vehicle to sell, to rotate out of, which I still have a lot of it, by the way. But anyway, you know what I'm talking about. Let's get into this.
Uh, first of all, yes, PMI greater than 50 is a macro bull, and we are in a PMI greater than 50. So, you're dead right, and it is historically accurate 70% of the time. Also, when they contract as well, it is a sell signal that is accurate 75% of the time. Super interesting. Let's look at the Bitcoin chart versus PMI chart going back to 2017. And you can see the little skulls at the top on the bottom chart is the PMI. It's a bit of an eye chart, and it corresponds extremely well 70 to 75% of the time with the top of the Bitcoin market. Right now, I'm going to turn my little camera off so you can see the other little spike that we have currently today, which caught everybody by surprise. And this technically is a very bullish sign. And Bitcoin, coincidentally, is spiking too. Sometimes there's a one or two-week lag between the PMI and Bitcoin. Sometimes none. So, we'll see where it goes. And by the way, profit-taking model. We spent a lot of time on models to make sure this is kind of a weird thing. Sometimes when you plan so much for something, sometimes some things work, sometimes others don't. Like our top and bottom indicator, it never went to orange or dark orange or red because we never had any blow-off top. It was a very unusual bull market. In fact, I'd argue we didn't really have a traditional bull market at all because the fourth year of the cycle was red. It went down. So it caught everybody by surprise. But if you did take profits, you'll see here, uh, using this typical model, start at layer 7, price would have been about, I think that's 84K, 109K, 119K, and 127,000. Layer 10 would not have hit, but all the other layers would have hit. So you would have sold a chunk of your money. If you started with one Bitcoin, you'd have a bag worth $104,000 right now. You would have sold $73,000 worth of Bitcoin. And of course, you can deploy again. Sometimes as well with this layer, if you hit say layer 8 or 9 and it comes back down, that's when you buy back in again. You'll single, single tap in at layer 7, double tap in at layer 8, etc., etc. But it's funny where we are right now. We're literally back to where we were 15 months ago. Now, we're going to talk more about other price, uh, simulations and targets as we go forward. So, be ready for that.
Shadow Moon, next question. Uh, thanks for your support this last week. It was a hell of a ride down. Yep. But good to hear some of your positive points as well. I was curious about your thoughts about possible Bitcoin Tesla pair trade since Bitcoin is down so much. It seems like a good opportunity to later rotate it into Tesla. Unless, of course, Tesla outpaces Bitcoin. Some brokers offer both crypto and stocks, and some crypto platforms also offer X stocks. It could be an interesting proposition. H, interesting. I have covered the risk of X stocks before. So be very, very careful with them, especially if you're using large amounts of money. These things are tokenized. Okay. We don't know exactly what's backing them. Uh, sometimes there's a lag in how they actually track prices and so much more. So be very, very careful with these things as well. They are not regulated or lightly regulated, if at all. Uh, so just one point of that. But let's get back into your big question. Uh, pair trade. Uh, obviously, everything is a pair. Remember that, everybody. So let's look at what would happen if you did rotate over the last two years between Bitcoin and Tesla. The Bitcoin return over the last two years is 70%. The bit, the Tesla return over the last two years was 135%. In fact, two years ago, I made a video on Financial Independence Day saying Tesla would smoke Bitcoin, and as it turns out, it has. Anyway, Kagger projection. If we look forward, this is interesting. What is the Kagger for Bitcoin? Well, because we're so low right now, uh, Bitcoin's at 71,000. It hit 62 a few days ago. Um, but it's, it's difficult to calculate a Kagger from such a low mark because it'll obviously be higher. But if you do assume a combined annual growth rate going out 5 years, 7 years, 10 years, it's safe to assume 20%, 35%, 50%, whatever you want. Uh, but I just put in some examples here of where I believe sandbag Kaggers would be. Tesla returned 35%. And if you rotate it, you'll be able to double your bag. An example with the rotation model here. Uh, instead of, by the way, I didn't use X stocks. I didn't use Bitcoin, but I did use Tesla and iBIT in the rotation model. And if you started with a bag of $35,000 two years ago, uh, your final value would be, and this is a 50/50 split as well between iBIT and Tela. You start with the same amount of shares, you would have made 63.7% just hodling. But if you rotated them conservatively, uh, you would have made 136.2%. So nearly two and a half times your money rotating. So the question is, do you want to pair trade? The answer is, if you can tax-free, for sure, um, make it happen, do it.
Uh, next question from Bzac. I, how many candle, this is, I'll warn you all, this is a very, another brilliant, very intelligent question, but also a technical answer. So, I, it makes me so happy that people are asking this type of stuff. Bullseac, how many candles apart can you go on the 4-hour any time frame between indicators flashing before they become invalidated? Like a mean reversion buy flag to a confluence buy flag to the trend change. Brilliant. As you know, if you have backtests on trend, mean reversion, and confluence, and if they all say 80%, you have a 96% chance of winning. That's just the confluence math as we like to refer to here. But let's just keep it real simple because we, it will still get technical. Um, this is kind of a very crude layout of what we're talking about, and we'll get into it with a chart example in a second, and it'll make a lot more sense. But if you, the simple explanation is, think of trading signals like a relay race. Okay, you start with a, say, mean reversion buy. Mean reversion kicks in first, and that's the first runner takes off. Then the handoff would be confluence. That's the second runner. It needs to grab the baton to quickly keep up speed, and the final signal would be to trend change, the final sprint to win. This is what's interesting. Now, if the signal appears quickly, for example, a mean reversion to the confluence model within four to six candles, and if it's a 4-hour chart, that would be 16 to 24 hours. The trade works, you know, 80 to 90% of the time. But if you are waiting too long for the confluence to happen across the indicators, like 10 candles, which would be 40 hours, the momentum has died. The first run, I got tired, and it's likely a fake out. Now, let me try and explain that with, uh, actual charts. Then it makes a lot more sense. Bear with me here.
So, first of all, here, this is Bitcoin, and this is Bitcoin this week. So, it's, it's a really timely chart to use. Um, you can probably hardly see it there on the bottom of the chart, but I have the first confluence flash where the, the buy signal begins to indicate that a buy is coming, and it was on the 4-hour chart right at the bottom around 62, 63K, but it wasn't the confirmed buy signal. Remember, this is a 4-hour chart. So, if you have four bars, it's 16 hours of action on Bitcoin. Now, what is super interesting here is the breakdown. So, you'll notice the trend turned. Now, this is using optimized trend. I'll use the trend trend model with the backtest in a minute to show you how this works. But this is actually really magical, and I'm very grateful for the question because it made me dig into how the models operated. So, the trend changed. The band turned blue. The 4-hour candle had the buy signal, but then the confirmed buy signal, 1, 2, 3, 4, 5 candles later, 20 hours later. That's the first confluence true signal. And it took three candles for the optimized trend to turn. So, in this instance, so, so as not to confuse it with the mean reversion, I left that off. We're just going to look at trend and confluence, but you can look at the mean reversion too because that did kick in first, as it always does. The trend turned on optimized trend after three candles, just 12 hours. That's your buy signal to go. And if you know and followed me on Patreon, you know what I bought when this happened. The, and then the confirmation of the signal happened, the buy flag. So, this all happened within two bars. So, again, it fits our theory. Anything after say 10 bars, it kind of gets stale, old, dead, failed. So this worked perfectly. Let's look at the trend model that has a backtest. This was even more precise. And remember, I use trend tight, uh, in my settings, but you can see the backtest here wins like 98% of the time. And that turned even faster. Just two and a half candles. And then a candle and a half, two and a half candles later, the trend confirmed as well. So that's how you do it. So again, the easy way to think about it is, do not let things get stale, that invalidates. Okay, the chart falls, you get into the high probability zone, confirmation happened quickly, less than four candles, three candles, two and a half candles. H, but if it had dragged on for 10 candles or 12 candles, that means it would be invalidated. So you got to wait for that to happen. Make sure it happens closely. And that means with all the backtest information you have, you can tell exactly the probability of a win rate in your trade. Also, remember the allocations matter. Very important. Things like this, when there is such a big dip, even though it may not be the bottom, it's worth going in with a pretty big slug as well. So I hope that helps.
Next question. Another pair trade rotation question, which I love, from Arion. Have you considered a pair trade of long Tesla, short Uber Lift? It could offer great returns if the Tesla vehicle autonomy succeeds in disrupting the industry. Great question. Now, I've been around long enough to know that even though there are companies that die, it takes a long time for them to die. If you go back and look at things like Blockbuster and Rhythm and Motion and all of these names, they have this weird thing called a last, last gasp before death. So, it's like they spike. You don't know when that's going to come. You see, you'll probably see that with things like Ford and General Motors and Stalantis as well over time, but be very careful shorting them because you don't know when they're going to have that last gasp. But let's go look at a couple of charts again and look at some, some numbers. First of all, the table, the pair trade long Tesla short Uber Lift, guessing with a little bit of science here, predicting what would happen under different scenarios. You got your moderate case, disruption case, bare case, etc. Um, with delays, the Tesla return, you can expect at least 30 to 35% per year. If things really take off, 50%. Sorry about this. Uh, sorry. I had to go get the dog. Stop. Stop. Stop. She probably sees a squirrel in the yard. Live TV is always fun. Stop it. Hurof night. Okay. Uber return. You can expect that to fall 10% a year, maybe 20%, but it's going to be around for a long time because robo taxis will not be deployed in all cities at once, and may, it may even go up 5% a year for the next few years. Lyft return. Lyft is getting hurt more, and we saw that in San Francisco where actually Waymo ate Lyft's market share. Expect that to fall 15%. Maybe bull disruption for robo taxi, 30% down. And if there is a bare delay for the deployment of automation, autonomy, robo taxis, maybe Lyft will go up 10% because it's already beaten down. So the net return, and I love where you're going with this, because if you have one asset that goes up, Tesla goes up 30%, and the average between Uber and Lyft falling between 10% to 15% on your moderate base case, your return is 47.5%. Bull disruption, 75%. And bare delays, you could actually lose 2.5%. So the risk is definitely there to do it. Definitely there. I've actually been waiting for an Uber spike to do it, and I haven't had it because it's just been down only for a long time. Let's look at the Tesla Uber pair chart. It's up 150% over the last two years. Remember Tesla Uber? Tesla's first. That means Tesla beat Uber by 150% over the last two years. And if you look specifically from the beginning of say, spring 2025 onwards, it's gradually going up. That's not good. If you look at Tesla Lyft, again, Tesla beat Lyft by 180% over the past two years, but it has been chopping sideways since again, spring 2020. So, Lyft, it behaves a little bit different to Uber. And it could even be interesting to look at the pair between Lyft and Uber, but I didn't do that. Anyway, overall, autonomy is coming. Tesla have solved autonomy, and, uh, these two will be impacted. Now, there's a couple of things I do want to mention too, very important. Some Altimeter Capital people like for Waymo, like, you have no idea how much people want to avoid people in a private passenger vehicle. They will wait far longer to be alone in a car, and they will pay 50% more to be alone in a car to avoid a human. Nobody wants to share a vehicle with an Uber or Lyft driver. And this statistic here proves that out. People say, "Oh, nobody's going to drive in a car without a driver." It's like, actually, people want no driver. They prefer to be alone. Uh, that's one thing. And the other thing that's important to note is there are some people that aren't really sure about the price prediction for Tesla. Why am I so confident in this asset? Well, I put together a very simple robo taxi model. This is just robo taxi. This is not Optimus. This is not Megapack. This is not all the other goodness, all the other 14 lines of business that come from this amazing company. But imagine they get 6 million cars. The robo taxi cyber cab will scale to 2 million capacity per year. I sandbagged it. They probably get to 10 million, maybe in 5 years. Maybe not. They have other cars they can make too. And they have retail owners' cars that can be turned into the fleet. But anyway, just say 6 million cars to sandbag. Imagine they get a dollar per mile. And by the way, this is out to 2030 because a dollar will not be worth a dollar in five or six years with the money printing and everything else that's going on. It'll be worth a lot less. So even though we say, oh, it could get to 50 cents a mile or 30 cents a mile, because the dollar will debase and call a dollar a mile, each car does 100,000 miles per year revenue, $600 billion price to sales multiple, 15 times. That you got a market value of $9 trillion, which is a stock price of $2,800, just on robo taxi yellow alone. Now you can cut this in half. You can say they only do 50,000 miles a year. Uh, they only do 50 cents, etc., etc. You can ratchet this down. It gets to $900 robo taxi or $1,400 depending what you do. But this is the way you need to think about this asset. Now, some do believe Uber will benefit from autonomy. Gary Black, for example, uh, I think he owns Uber. At least he did in his fund. I'm not sure because he sold, I think Tesla at 183 but wanted Uber instead. I do not believe in this, everybody. No chance in hell. Uh, Tesla does not need to partner, and Uber will die by the wayside. At least it'll be a slow death because robo taxi will not be available in all cities at once. It'll take time. So, hope that helps.
Steve, you mentioned never exceeding 33% of your margin. Does that mean the notional face value total account for my position should never exceed 33% of my account's available buying power? Or does it refer to the margin actually used? I, the margin requirement consumed by my position staying at or below 33% of my available margin. Tada, just wondering if the margin ratio matters, 1:2 standard margin versus 1:6 portfolio margin. Let me try to explain this from the way I think about it, which is important, uh, for people to wrap their heads around. Again, I'm here because of margin, I'm here because of debt. Uh, but this is the important little number to know is this refers to 33% of your available margin limit, not 33% of your buying power. So imagine you got a 100k account, your max leverage used to be 33k. Very important because if, if there is a nasty situation, a big drawdown, okay, imagine a black swan happens and the market drops 50% on your position, you lose 50% of 99k, 49 and a half thousand. Therefore, you're still in the clear, you're still safe, no liquidation, nobody there to force you to close your trade because you have plenty left. That's why I use this as a rule of thumb, and I keep my margin dry, like my powder dry for that black swan that invariably happens all the time. I believe we're going through multiple little gray ones right now so far in 2026, but there might be more shoes to drop, so be careful. Now, when that shoe does drop, then I tap it all. Like, um, imagine C19, imagine bottom of the bear. That's when I really start, when I'm, when I'm 99% sure we are at a market bottom. Then I go hard, and I do break this rule. But don't do it unless you know what you're doing.
Matt P, let's say I have my retire on bags packed just below the Tesla number and some way over the Bitcoin number. Ideally, I should wait until 2028 to retire. But let's say there's a huge family incentive to retire as soon as possible. When would the absolute earliest you would take the plunge based on your standard retire on amounts of Tesla Bitcoin? I love this question, and we should all be thinking about this all the time. So I'm going to answer this using some models, so bear with me. First of all, retire on models, 30-ish, 2030-ish target, 2032, 2031, 2030, we don't know. But Tesla could easily sandbag, hit $1,800. And Bitcoin, if you ask all the experts, they're saying 1.5 million, 1 million, etc. I'm sticking in a sandbag 650K because we're super weak right now. Current price is $71.85. Probability of this hitting by 2030, well, that's up to you. You do your own calculations. But the point I'm trying to make here is the opportunity cost of selling early before that target is high. So if you can wait till 2030, each share goes from $411 today to $1,800, and each Bitcoin goes from, you know, nearly 10xed. Again, Bitcoin's beaten down. And, you know, maybe after what happened. I don't know. We, we'll see where this goes. I do want to say one other thing though, as well. Uh, very, be very aware of risks and future risks. Um, there's a lot of chatter out there still about core versus knots, the developers, and hard forks and all that stuff. This is all bad for Bitcoin. Really bad. Being a paranoid, nervous guy, it makes me nervous. Their focus, the Bitcoin developer focus should be on quantum, not on adding JPEGs to store value. Okay, that's my simple take. And probably going to be very unpopular for that. But again, simplicity for Bitcoin is a feature, not a bug. Don't overcomplicate what is already perfect. Anyway, focus should be quantum. I just want to say that because if things really continue to go sideways, people will lose faith and lose trust, and that means the price appreciation may not be as high as you think.
Now, let's talk about numbers. So, I put together two different scenarios. So I assumed, by the way, you have 300 Tesla shares. So you're close to your retire on bag, which is 300. And you got way more Bitcoin. So I assume two Bitcoin, 300 shares. Okay. Now, I assume using the retire on model, 2027, you will pull $40,000 a year to retire. You might need more, you might need less. Download the model and, uh, play with it yourself. But I have the Kagger of bit, of of Tesla being 35%. And Bitcoin Kagger 20%. That means you have to pull out 40k a year based on your bags of 300 shares of Tesla to Bitcoin. And that total bag is worth about 265,000 today again. And your retire on bag where your polo will be indexed at 4% per year. Let's see what this looks like. And here you can see how it all plans out. The danger here is you actually make it. You have enough escape velocity if you start pulling out next year. But that assumes a 35% Kagger on Tesla. Do we have that? We're not sure. And by the way, the model has all these tables and everything you can look at. Now imagine for a second, 2027, same thing. Same bags. 300 shares of Tesla, two Bitcoin, total bag 265K. You're pulling out in 2027. But the difference is, I'm going to remove my camera. The difference is I have a 20% Kagger on Bitcoin and a 20% Kagger on Tesla. And the reason for these models is so you can run your own scenarios, and you can sandbag them, and you can calculate exactly when you can retire and how much you can spend during retirement and all that good stuff. The danger here though, the really scary part about this one is your funds are depleted in the year 2042 on these Kaggers for these two assets. That's not good. You don't want to not achieve escape velocity. You're basically going to blow your bags, run. But what is very important now, this is the magical part, is what I call, what a difference a year makes. If you can stall the pull, you mentioned you got to retire as soon as possible, the opportunity cost of retiring now at these prices and spending against your bags is extremely high. But if you can stall it, okay, even again assuming 20% Kagger for Bitcoin and Tesla, but you stall the pull till 2028, you achieve escape velocity, my friend. But you don't. You don't. If you start pulling in 2027, you run out of your money in 2042. But if you can wait another year or control the burn aggressively, you reach escape velocity and then you can survive perpetually again, assuming the assets go up forever too, as well. So I hope that helps. Uh, but very, very important for your future planning.
Next, oh, by the way, there will be a link for this, uh, after the video. Thank you to the team who put it there. Invest question. Fun name from Invest Answers. And this one is another, the questions this week are phenomenal. I always want to thank everybody for the brilliant questions. I've got an interesting hypothetical question. Let's say you've got $100,000 cash today, but you're going to jail tonight. No phone, no internet, no charts, no trading. You can't touch or manage the money for the next 8 to 12 years. You're forced to deploy every dollar before you walk in jail. When you're released 8 to 12 years from now, whatever you bought is unlocked. What do you buy? Tada. So, I would, well, I'm going to answer this two ways. I'm going to answer it, uh, what I believe are the best long-term plays. Again, it's like the old hypothetical question, not like going to jail, but you know, you can only hold one stock for 10 years is a common question that comes in too. And that's 8 to 12 years is like 10 years. So, I think about that all the time. What would you hold? So, first of all, and this is actually very reflective of my current allocations, not by, I, I put my money where my mouth is. So, you need a compounding machine. That's Tesla, 50%. Uh, this is very important because we are on the cusp of something huge, and this is by far, I always look for the best risk-reward. I don't necessarily want the fastest horse because that can blow up or break a leg down the main straight, but I want something that is as close to a sure thing as possible with the maximum Kaggers. And we know over the last, in the history of the earth, the best stock ever in terms of Kagger was Tesla. But they're about to get into a whole new realm of robots and autonomy and everything else, which will be completely mind-blowing. I'm very convinced. Next, you need a fiat hedge because you're going to be in jail for 10 years. You don't know what's going to happen to fiat, but I'm pretty sure it's going to go down. Uh, so you need about 25% of that. Then you need an L1 play, layer 1 play. I believe Solana is the winner. Fastest, cheapest, best, most breath of dabs, most widely adopted, best development team, etc. I believe that's going to win layer ones. And when you come out of jail in 10 years, everything will be tokenized. Your summer home, your house, your stocks, your bonds, your money markets, uh, everything will be tokenized. The question is, where will it be tokenized? Again, the best, cheapest, fastest. Unless, of course, some kid in a basement creates a new layer one. That's better. That's also possible in the age of AI. Who knows? But that's why it's a small percentage, just 10%. And AI play, what runs AI? Artificial intelligence. Again, will be deep into artificial and super intelligence when you come out in 10 years. Um, AGI is already here. All the experts say that, even magazines like Nature says AGI is here. You'd be 50% allocated. Majority of that would be Nvidia and a little piece to AMD as well, and maybe a couple of other ancillary players. So that's how I would do it. Now, if you can only hold one asset, that would be Tesla, 100%. So I hope that helps, and I know you're not going to jail, thank goodness.
Anyway, Dalmos, hi James, I found this fund from Ron Baron, BPTRX, which is the ticker. Retail investors holds currently 28.6% in SpaceX and 26.7% in Tesla. Is it worth considering >> this? >> Thirsty for space exposure. So I think there's confusion because BPTRX is 29.96% Tesla. You have 28, 26.7%. That's wrong. But it doesn't have SpaceX. It has other things, hotels and MSCI and Charles Schwab and stuff, but no SpaceX. Well, you're confusing it with this one. That's the ticker Ron B that has 13% Tesla, and it's got two slugs of SpaceX Class C and Class A, both adding to about 14.4%, and has a little XAI as well, about 4.5%. That is very, very important. Now, the Ron B has 13% Tesla, 14.4% SpaceX, and 3.6% and that's about 31.03%. So don't confuse Ron B with BPT or ax. Very different. Thanks for the question.
From Baka Luir, thanks for everything you and your team are doing. These latest videos and options are truly excellent. Glad you enjoy them. I'm generally not a fan of meme coins, but I noticed DeFi Technologies, DeFi Development Corporation, recently launched their own meme coin called Don't. They claim it's the first memecoin ever issued by a publicly traded company. Since we see a meme season every one to two years, I'm considering buying a small amount to put aside and just wait for the next cycle. Given that the market cap of this coin is very low, the upside is huge. Does this make sense? No. Don't touch meme coins. And it's dumb for a company like this to dabble in this nonsense. I'll be very frank about this. It's like, holy crap. Don't. And it's disappointing that DeFi Development is doing this stupid stuff. Anyway, just my opinion. I'm just a guy on the internet.
Tgo Jean, huge thanks for your incredible work. It's been life-changing. My Tesla bags are fully loaded for 2030, 2032 vision, and I'm 100% convinced Tesla will dominate long-term. I've noticed, this is actually another brilliant question, by the way. I've noticed strong runs in overlapping Tesla lanes, ASTE, EOCC, LNC, on, etc. Uh, have all gone up 5 to 8x. It's almost like a remora fish feeding on the scrap stirred up by the shark. I love your analogy. Is there any value in these Tesla adjacent opportunities in the interim? First of all, remora effect. These are the little surgeon fish, etc. This is a whale shark. I actually bumped into one in Thailand about 30 years ago. It was incredible. Um, beautiful, harmless giants. They're about 35 ft long, if I recall. Anyway, these are little animals that feed off them. And in the stock world, we have a thing called, uh, the, the way to explain it in the stock world is the remora effect. You know, you've got these little guys who jump on the bandwagon on something like a whale shark. And the remora doesn't have to hunt or swim hard. It just latches on and travels on for a free ride and eats the scrap the sharks leave behind. But basically, in the stock market, the shark is the dominant company like Tesla, and the remoras are small players whose business model is like the shark. Easy way to think about it. And these players here have done really well. As EOC, Jeff Lots is a fan of that one. Uh, on this, uh, we'll get to all the tickers, but let's go look at these companies real quick. Uh, AS is a complete value trap. Be very careful there. EOC is crazy overvalued, and I know there's a lot of believers in this company. Um, and I think the only way they make it is if they get all their money from large government contracts, but the financials are very horrific, and I've always said that too. And it's significantly overvalued. Uh, company called TE, again, shocking, losing a ton of money, have a ton of debt. Uh, cash. Look at the way the cash is falling. This tells me they'll be out of business very soon unless either they dilute like hell or raise some money. So, bad sign there. This one is interesting. Of all of them, uh, Fluence Energy is the best. It looks fairly valued. H, sort of not growing, kind of flat, very hit or miss, but at least they got a little bit more cash than debt, which is okay. And finally, and again, look at the stock-based compensation. Extremely high, no real growth, losing a ton of money, and a big spike in cash, which tells me they issued some stock. Now, the other very important thing to look at is what we call in the IIA inflation model. Look for extreme dilution. And by the way, I threw MicroStrategy in here as a comparison. This is going back to January 1st, 2025, to show you how extreme the dilution is. MicroStrategy issued shares to buy Bitcoin. These guys issue shares just to stay afloat. So, EOS Energy, 53% dilution in the last year. TE Connectivity, 14.18%. Not too bad. I'll let that go. Fluence Energy, not only is it fairly valued, but only 2.33% solution. That's minimal. That's completely fine. Like anything under 3% doesn't bother me at all. AST Space Mobile, 76%, very heavy dilution. And OnDesk Holdings, 271%. That's extreme dilution. Okay? When you have a company with these levels of extreme dilution, you're just not going to see any capital appreciation in your stock. So be careful on this. Always keep a close eye on these dilution factors because they are not good, everybody. So, yeah, um, I wouldn't touch any of them now. They have run. They could continue to run for all I know. I don't know. But again, my number one rule of investing is don't lose money. Therefore, I run away when I see risk.
Next question is TV AOH TVA TV. When AI will take over stock trading, what would we finally arrive at a point where the capital markets become fully efficient? And would we mean that the only thing left for us mortal souls is to invest in index funds or gamble? Yeah, gambling is growing in popularity as well. As humans get more desperate, they gamble more. They go out on the risk curve to make it happen. So, we're seeing a big amount of that happen. But do not gamble. The casino is bigger than your house. Next, this is kind of a, a quick view of what I, I believe will happen in the very near future. You know, markets are 70% efficient right now today. Um, retail can have an edge through tools, arbitrage, uh, options, that type of stuff, technical analysis. And the best strategy is swing trading, like on the 4-hour chart, getting in and out of position every four to six weeks. That works magic all the time, everybody. That's how you win. Don't day trade. And, uh, if you have, if you got plenty of time on your hands, you can do one, two trades a year, very long-term investing. But in the AI world, the market will become much more efficient, about 95% efficient, which means it's going to be very few opportunities that you can find. And the algos and the bots and the agents will be running things. So it'll be very hard to beat them, especially at the speed at which they run. Um, the, what you can still do though, is if you can predict the future and you get involved in long-term swing, swing trading. For example, if next 3 to 5 years, you know, Uber is going to go down and Tesla's going to go up, that's the way you play. Uh, because you, if you have the intellect to forecast the future, well, you'll still be able to make a ton of money. But the swing trading may not be four to six weeks. It may be like three to six months. And they'll be the angles that you play. And then you can amplify your returns using options as well. That'll be the game that we play in the future. So hang tight.
Craigm, does Tether's goldback stablecoin undermine Bitcoin's value as a fast global transfer asset? And does that justify a bearish outlook? Well, Tether have been extremely clever in how they have stacked both Bitcoin and gold for the last few years, and their gold investments have done really, really well. But let's look into this real quick. And this is kind of the, the long version. You can read it yourself. Um, and what I want to kind of get to is the net of, does it make sense? Well, I do believe when it comes to store value, Bitcoin is the king, and it is censorship-resistant, etc. Gold is just too, too hard to move, too much paper, etc. It's crazy. Um, but I do believe this goldback stablecoin will create more on-ramps for the whole space. And I believe it complements rather than competes. You know, stablecoins do not replace Bitcoin. They are the fuel for crypto. And people use stablecoins to move fast and trade. But Bitcoin is ultimately what they want to own. And speed can be copied, but trustlessness can't. And therefore, I think Bitcoin remains king. As long as, I said at the beginning, the devs don't screw it up. Next.
Next question. I'm trying to get done fast so you guys can all get to your Super Bowl party. Anyway, Go Pokes. Could you give some commentary in Circle performance over the last six to seven months? Quite a few in the community hold this one. I have a slice of it, too, by the way. Um, that was kind of clever. I didn't buy the IPO. Waited for it to dip on the dip. Got in, uh, I think it was like 140 or something, and then it shot up to 195, 197. I hedged it, but now I'm still holding the bag. So, you can't win them all. So, Circle performance is down only since 197. That's when the trend turned here. There's the orange trend all the way down. Let me turn off my camera again. And I don't know what's going to happen next, but there's a few little things that are kind of worth sharing here. First of all, it is below fair value, uh, cash flow value. Cash flow value, which is a super conservative way to appraise this, is $63.81. It's trading at $57 bucks. So, it's 11% undervalued. So, that's good. And the other thing that's happening is, uh, from Artemis and shout out to Milk Road as well. Oh, wow. This is the amount of actions, stablecoin action transactions. Okay, we are over $10 trillion of transactions made in the month of January 2026. Okay, the total amount of transactions, I think for the whole year last year was like 33 trillion. So this thing is really beginning to take off. And the most important thing I want to pay you, pay attention to here is this is all USDC, not Tether. All the action, all the trading transaction action is all happening on Circle right now. That is a potential tailwind for Circle. We just may have to wait. Uh, I know they're negotiating a new deal with Coinbase. Hopefully, they'll share less of the actual take. And people are worried, too, that because interest rates will fall, the stablecoins will not make as much money. But anyway, we'll see. We need that some clarity on the, the legislation coming for crypto as well. That's going to really help this space. So until then, we're just in a holding pattern, but I'm still holding. Anyway, it's been ugly. Would I buy more here? No.
Next from hoofhearted horse person, sounds like first time here. I've 10xed my portfolio since following you. Nice work. Do you think it's possible worth in the not too distant future to mine Bitcoin in space? Another great question. I like the way you're thinking. In space. Like, can you look at, I always look at total addressable markets and like the four biggest ones right now that I see: autonomous vehicles, like robo taxis and stuff, humanoid robots, then you have space, and then AI. And guess who's in the center of all this stuff? Very big. So the question is, space-based data centers are going to happen with three years, five years? The answer is absolutely yes. They have to because there's no, not enough energy on Earth, there's not enough space as well. But will Bitcoin mining go into space? Nope. Never. Let me explain my reason why. And I, again, just a guy on the internet, could be wrong, but it doesn't make logic to me. Yeah, space-based data center is cool. But the Earth has very cheap things like hydro, etc. And Bitcoin mining has razor-thin margins. I always say it's a cutthroat business. From day one, cutthroat, cutthroat, cutthroat. Be careful of Bitcoin miners. Buy them when they're cheap. But space adds huge launch and replacement costs. And remember latency, that this really hurts the efficiency as well, and rapid ASIC obsolescence. These things go out of, you know, they become redundant within a very short window of time. Unless, of course, you can hook old machines up to clean energy, but the problem is they still become obsolete, and many of them break, and that would require constant space relaunches, which is very expensive. Also, Earth already has abundant energy if you can go to that energy. And that's what the Bitcoin miners do. They go to the far-flung corners of the world where there's cheap energy. But space doesn't solve any real problem that Bitcoin miners have right now. So, nope, I don't see that happening.
And this week we donated to Indra Lakloa Animal Sanctuary to help support a bunch of chickens, it looks like. And this is Sunshine Rooster. He loves berries, taking dust baths, and keeping an eye on his favorite friends. I would not mind having a dust bath and eating berries all day. Why not? We'll see. Uh, let me see. Somebody just bought some Circle CC Ireland. Yeah, $52. That's a good deal. It's undervalued at that. Actually, a good question. I just popped this up real fast. Um, yeah, buying at 52 is good because that's undervalued at this level. So, nice work. And also, DCA tomorrow morning, like usual. Let's do some live Q&A. I hope you all got smarter. And it was, that was called Jail Stash. Jail Stash. None of us are going to jail, by the way. I just want to be very clear on that. And once again, thank you to the mods in the chat. Uh, no questions yet. I know they're coming up. Um, and a big thank you as well to DBF, Piper, French Dreamer, Dog One, Chaikovski, Haya, Dog One, Bman, I'm Colt, and Buckhorn, and Clinton. Looks like there may not be any questions today, but I'm Colt says, "UCC on Paramount Plus has been the best thing ever. Have you been watching these past few weekends?" I heard there was one yesterday, but I was busy working on this for you all. So, I didn't see anything yesterday, but, uh, it's, it's interesting that pay-per-view is gone. And hello, Chaikoski. Grateful that you are here, too. So, unless that is it, ping me. Um, I'm going to ping. Uh, I don't think there's any questions. Oh, there are. Uh, I think I mentioned them as well. Grateful Chaikos for you too. I'm Colt as well, and thank you for your super stickers. Well, TBF, Piper, French Dreamer, Hle Gilla, Buck Horn, etc. Everybody wants to get to the football. Everybody enjoy the game. Thank you all for coming. Happy Sunday. See you tomorrow morning, bright and early. Thank you as well to the great mods in the chat. Bye.