Transcription
Uh, time to get going. Uh, you guys can read through these on your own. All right.
So, just to start off, we get the ceasefire, and obviously, uh, with people worried that leads to uh a move higher this week. And as we're basically going through it, I thought this was a great line from Lynn Alden, because uh, trying to call the top on structural bull markets rather than go to therapy. That's why I basically believe we are at a stage in the market where we're going to get more bearish stuff coming out soon. But for the time being, there's no way to refute that. We had this correction here in 2022 on the back of rates where everyone worried about a recession. Then we had the tariff fall uh and rally back to new all-time highs, which we obviously did here. It took a long time. This one took no time to fall, no time to rally, but breaking all-time highs. Uh, a lot of the reasons that people were worried have not changed. We haven't signed any agreements. Uh, the economy is slowing. There's still plenty of reasons to be bearish.
So, we will have the next phase. I'm going to hopefully take you through again another element of what's driving this market and why AI is in a very, very important stage right now. Uh, the NDX made new all-time highs. Small caps continue to underperform. Uh, have not yet broken out, and again I think they will continue to lag uh the larger companies because of AI. The breath of the market, you're going to hear this as a negative. Right now, we only have 45% of the Russell 3000 uh above the 200-day moving average. It bottomed down around 15%. I showed this chart back then. I had these two lines because every single time we had gone below this and gone up, it had gone through it. I'm not going to go through a lot of this, but basically people are being forced into the market. And I think this was another week where people were basically being forced in, but into a concentrated market. Uh, 52-week highs as we make new all-time highs. The percentage of of companies in the in the S&P 1500, it's small. There's not a lot of new highs being set. This is being driven again by a parabolic move in the AI trade as people who got knocked out or consolidated during the Nvidia time. So, Nvidia peaked around here. We consolidated, and now we're breaking higher as people are jumping back on realizing that AI trade is still on and you're getting a broadening out this week. We got Micron. I've talked about Micron. I still think it's going higher, higher, higher uh as we move into the embodiment stage, which we have not done yet. We're in there's about one out in the first inning of the embodiment stage. Uh, which is the reasoning part. Uh, memory is the key in the AI age. Completely agree. Semiconductors are leading the way. This is over the last 10 years. This is so stocks over the NDX for the quarter. Um, so a massive move higher of outperformance uh semis over software is leading us higher, and I believe that's going to be this the the case. This is not driven by the Mag 7 uh completely. You obviously have some of them up now. Believe it or not, year to date Nvidia is up 17%, Microsoft's up 17%. Meta's up 25%, but Alphabet, Apple, Tesla down, Amazon unchanged. This is not the Mag 7 this time. There's a lot of uh winners and losers. And I think this is the AI side, and I've talked about it before. I do not expect the Mag 7 to be the place to be. Uh, Nvidia's now had a big run. I still think Nvidia will be fine, but I think you're going to keep running into these problems with these companies uh every now and then as uh they're just not getting the revenue in they need.
That being said, do not short them.
Uh, Atlanta Fed GDP. Now, remember, we've now had a negative .5% in the first quarter. We're supposed to see a large bounce back in the second. This is now going down down to uh below 3%. So, you're talking about sub uh 2% growth in the first half uh combined uh which means things are on the weaker side. And tenure rates. Remember up here when we were in the trust moment uh just like on the liberation day moment just like the Iran Israel there's been there's constant worries that just keep entering because people don't want to believe this. I'll go through the reasons why trust moment we've just gone back down to four and a quarter. Most importantly, we're still in a 2-year range between for the most part four and four and 3/4 with slight breaks below. Uh, but for the most part we're sitting there. We're now at 91% 92% for a Fed cut uh in September. I will remind you something. Cuts during times where we are not in a recession are extremely bullish for stocks. Uh, we are not going to have a recession. Uh, the dollar continues to weaken as it broke down again. So everyone trying to pick the bottom of the dollar. Uh, this is a structural problem uh that to me will take time. It's overowned. Uh, I think that's a much better trade as I've said than the equities. I think the dollar for a whole host of reasons including the democratization of AI including the fact that the US uh capitalist uh approach is breaking down uh and it's becoming something more as I'll go through where the system is breaking and the global reserve currency status everything is just kind of breaking down because they're they have to deal with the median voter in the country and their situation continues to worsen and I think will get worse as time goes on. Uh, so the dollar just continues to weaken with no bounce. Uh, to start off a year, every single month has been down now as we get to the end of June. That has not happened. I I don't know when or if it's it's happened. Uh, but to have six months down in a row is a difficult thing as it is. The last time we had it was in here, and you can see there were a couple months that it did move. So this is a persistent pervasive pronounced decline in the dollar. This is not something minor and it continues.
Where I want to segue now is just why the recession talk is going to continue because we do have a recession in anything not related to AI. Uh, so if it wasn't for artificial intelligence, if it wasn't for exponential innovation and the mag 7, we would be in a recession, meaning if the digital economy didn't exist. So the LEI uh is something I just want to highlight. Uh, I put this line in here, and what you can see, this is the year-over-year LEI. We have now been negative for 35 months in a row. We went negative right here. It's been 35 months in a row that we've been in negative territory. It's been 34 months that we've been below this line here, which is the minus 1% line. Every single time that we've been below in this area, it was a given that we were going into a recession. At this level, we were supposed to be in a recession. So, it's not just that we were supposed to hit a recession or be in one. We haven't had there hasn't even been a a hint of it other than the fact that we had those two quarters of negative GDP in 22 when we hired 4 million people that year on the job side where I've said repeatedly and for those of you who uh either don't watch me all the time or go through it, the job market will be weak by AI, there is absolutely no doubt about it. At the same time, anyone can go get a job. You can get a job if you want one. The question is, will you accept the pay that you're going to get if you lose a job in one white collar business and you have to go work doing Door Dash or go to Dunkin Donuts? There are plenty of jobs out there. We have a labor shortage. The problem is the areas that we have a labor shortage are very different than the places where people are getting laid off. And that's the issue that's going to come. What I have here is we're in a level at this point, which is the year-over-year job creation. So, this is the non-farm payrolls. We're currently at 1.08%. That line there, we've never been this low and not been in a recession already. So, 1% figure that's about 1.6 million people that have been hired over the course of the last year, which means that's about 100 uh about 115,000 somewhere in there. uh what you're dealing with at this point is that we're not creating many jobs and as I showed you outside of health care and travel and leisure the number is right now 30,000 a month except for those two sectors uh which are government subsidized through Medicare, Medicaid and social security. Uh, but otherwise the jobs market's in a recession. The reason this is important is if you go back to the LEI and I don't know how many people actually understand when it was created, what went on, but this was created in the 1950s and 60s by Jeffrey Moore, uh I spent a lot of time with ECRI work. I built my own models in the same time using asset classes when I was in Brazil in 97. I used them throughout uh the hedge fund time when I managed money as a forecasting tool for when a recession was coming. In the LEI, it's very broad. So you've got manufacturing hours worked. You've got initial claims for unemployment. So this is the jobs portion. Uh, both of these at this point have been weakening. You've got new orders weakening. New orders weakening. New orders weakening. Building permits in the housing side weakening. Let's skip this one and this one. Yield curve obviously been screaming recession for a while. And consumer confidence shocking where we are in consumer confidence for anything at this point. All of those suggest there's a recession. What doesn't is the S&P 500 because I'm going to say credit is completely driven by the S&P 500. So think about it. The economy is in recession which means people are suffering on all elements and right now of the earnings growth of the S&P it gets isolated to seven companies. So the MAG 7 right now we hear that they're 30% of the market cap. Well here's where you take the market cap uh weighted earnings per share. 55% of the earnings of the S&P 500 growth. So basically seven companies are winning and this is where you can see the profit margins for those seven companies and here's the profit margins for the companies that are not part same same level as 2018 while up here we've had a huge boom. So the mag seven is driving everything and that's why people feel the pain when you take it to revenues and the growth rate. Forget the past here. This is what's forecasted now or this is what happened going in. This is what's still forecasted. So you have revenue growth for the MAG 7 still coming in at this point at 10%. While the rest of the S&P X that which is the green um sorry is the uh the red you're coming in at three and change maybe four if come through less than five. basically at nominal GDP or less. Historically, the S&P 500 would get earnings uh revenue growth that would be a multiple of nominal GDP by about 1 and a half. So, if you had 5% like we do now, you'd expecting 7% revenues. This is why everyone feels there's a recession. The only companies that are generating revenues that feel like growth are the ones who are not hiring anyone right now. And so here is the profit margin numbers. Same story. The red line here will be the S&P 493. Just look at the discrepancy between them. These are massive differences between the MAG 7. The Mag 7 have been benefiting. That's the digital economy. They own it. It's global. It's why foreign stocks have underperformed. If you are betting on Europe to outperform the US continuously, forget the currency for a second where I completely agree, but you're betting on the MAG 7 to underperform those countries at this point. I do think over time that'll happen because I think AI is democratizing, but you're in there. The sentiment to slack at the end of the year, the reality is high and growing concentration continues to be a major problem. It is not a major problem other than the fact that it's hurting the economy and creating this problem. And this is before we get into the most powerful force yet. We have not entered AI. All we've done is the simple chatbot part, the stuff that has not been used by the workforce. Now we're entering inference, reasoning, uh conscious deliberation, anything any any way you want to call it. We're entering the part where we're starting to have AI agents and behind that is robotics as I'll get through. So this is only going to get worse. That's why I keep saying do not underestimate how bad things are going to get in terms of the way people feel without a recession. Uh, imagine a world where machines not only perform physical labor but also think, learn, and make autonomous decisions. The world includes humans in the loop. Bringing people and machines together in a state of super agency that increases personal productivity and creativity. This is the transformative potential of AI, a technology with potential impact poised to express even the biggest innovations in the past. It doesn't matter what the innovation was. There's nothing to compare this to. So, do not doubt it. Do not fade it. Try to figure out how to make money off it. And just remember, the LEI is the short. The long is AI. As I go through this, I want you to keep remembering that if your brain is fixated on the LEI and the data of the past, you need therapy. That is the reality. You have to focus your stuff. And now I can see that people are being forced into it because asset managers are forced to make money and if a recession doesn't happen, they have to get more into AI. But the problem is, can they do it? Uh, this is the percentage of firms planning on using AI ramping. So again, this is all starting now with reasoning. Reasoning is the most important part. But of course, uh we will now start fixating again on tariffs. We'll start fixating again on Fed independence. Everything will start coming and we'll get some new bearish thing whether it's a recession or not. But they did say the tariff deadline is not critical. Walking back a little bit again. Uh, but as to points out uh has Trump outsmarted everyone on tariffs because he is getting the tariffs um and nothing's happening to the market. So he was able to get to the point where 400 billion of annual revenue for taxpayers is something that he wanted to get. And if he can keep 30% and 10% on all countries and then give all countries 12 months to lower just keep rolling back the adjustment in aggregate, then he's going to get what he wants and be able to still have people on edge uh and threaten more and more. This week was a big week for Trump going after Powell. This one was even higher, I would say, than the prior ones because now we're getting into a bigger thing. Naming next Fed chair early and bid to undermine Powell and have a shadow Fed. Uh, so you get markets to protest if Fed independence at risk and what would happen? Uh, I'm sure they would, you know, be angry for a little bit of time, but again, I think we're heading to a a point where as you're watching everything, whether it's tariffs, the market responded to that, it meant nothing. Recession fears it respond to that. Donald Trump is in there to disrupt. He is trying to disrupt and every time that we get negative and start extrapolating things uh on anything. I mean it was just last weekend that the bunker bombs were in there and the talk over the weekend was that oil would end up spiking to over 100 to start off the day. So I think the market just keeps responding to things and not realizing that this is a process that's in place. Capitalism the way we know it is under attack and the global reserve currency of the dollar and the what it's been in the past we are having a completely different world and AI is forcing it innovation is forcing it because the voters are not happy treasuries rally dollar slumps as Trump buys Powell's successor gets back into why the dollar was weakening um just I'm bringing this up I want you to keep track of this name Piyush because uh he's going to be the one I think is getting more and more press as we need to figure out a way to deal with the anger of the people. Jobs is one thing. The ability to find affordable housing is another. Rates, rates, rates. I believe we need to begin lowering rates so that Americans can see relief in their daily finances. Obviously, Trump has talked about it from saving the country money because of the interest expense. Piyush is right. Powell's refusal to cut rates is economic malpractice. The 4 and a .5% rate strangle hold is crushing home buyers, trapping owners in low rate mortgages, and fueling a housing supply crisis, which is true. Trump says he thinks the Fed should set interest rates at 1%. This was late on Friday uh that this uh he basically said this. Uh, I I don't know if he's serious. Uh, but he is again going on this. But I just want you to think Trump says he thinks Fed should set interest rates at 1%. He also said uh I've instructed my people not to do any debt beyond nine months or so. You're really talking about uh some form of uh printing. Uh, we'll just see what goes on. But running things of the basement and moving rates lower to run them hot and grow your way out is what the game plan is. So obviously um we've got this uh for New York City. So let's just go through um the prospect of the capital of capitalism going socialist poses a challenge for those who want to see New York City prosper. I viewing this as just a major statement by voters again that fit into this. Peter Thiel on why 70% of millennials say they are pro-socialist. When one has too much student debt or if housing is too unaffordable, then one will have negative capital for a long time. And if no one has a stake in the capitalist system, then one may well turn against it. The other thing that is missing from here is the fact that the jobs market is horrific for young people. Uh, the corporate ladder has been destroyed and this is all before AI is coming. This has been happening. But when you have debt to start off your life, housing is too unaffordable, and you can't get a job to make enough money, you're really in an angry position. And when it happens with the younger generation, you're dealing with people just graduating college. Uh, and I hear from them, I hear from their parents, it is a problem. Uh, and that's where we're at. And this has just started. So when you see things like this where they haven't hired and you have people from the again LEI world I'll call them this was Torsten Sløk saying this is because the Fed starts raising interest rates. These companies are growing revenues at exceptionally high levels and they are not hiring for the first time. Until people start realizing AI's damage that is happening it will be a problem. I wrote about this and said, "This growing tension won't just affect workers. It will force major shifts in both fiscal and monetary policy as governments and central banks grapple with how to support displaced labor, maintain economic stability, and respond to a world where productivity rises without broad-based employment." This is it. I wrote this because everything that I'm going through right now on this week's video is about the tension happening between monetary policy, fiscal policy, think the beautiful tax bill, think Powell, think the jobs uh market in terms of not hiring. This is something that has been happening and going, but now the pace of innovation is speeding up and it's about to go parabolic. The AI situation, machine learning has been around for a long time, but bringing ChatGPT out to every single company and now getting into the reasoning and thinking and conscious deliberation side where it's going to be connected to machines and digital agents. This is only going to get worse. I have no idea how bad the unemployment situation will be. Um, my guess is is that it won't be as bad as what the worst people are saying, but I definitely believe that it is having an impact. If not only psychologically, it will make people fear things. Um, this is the housing situation just to show how far above we are in terms of the cost of housing. So, jobs markets we can comment. Luke Gromen put this out and basically, you know, it it's the same thing. Uh, New York City's biggest banks are too big to fail. And when too big to fail, bank capital is mandated.
To hold government debt instead of gold. Socialism. Um, we're just in this predicament right now, and they're trying to find some way. So I wrote, I talked about uh, Joseph Schumpeter last week, and I used his line uh, that was implied in one of his books that at some point when innovation speeds up so fast, driven by capitalism uh, and printing money and allowing things to grow at a very rapid pace, you end up with a massive distribution of wealth problem, which is what we have. And then eventually cannibalism; capitalism cannibalizes itself through the fact that it doesn't actually need any more jobs. And so creative destruction, the process where new entrepreneurial innovations arise and subsequently cause the old way of doing things to disappear. Again, lei disappear. Okay, robotics time. Um, because this is coming, and if you haven't spent the time on it, which most people have not, I've realized that as I'm planning a uh, very important uh, conversation uh, about humanoids and about nuclear and about power.
Uh, Chris Camilillo, who I've listened to many, many times this year, uh, probably the best voice on, from the investor side, on where we are with robotics and humanoids. He did this uh, interview this week. I highly recommend listening to it. The highlights: Uh, Chris declares AI is everything, comparing its importance to the arrival of the internet. If businesses or individuals don't adopt AI tools now, they will fall behind. If you're not using it, you're done. The three skills need stand out: Resourcefulness, learning, agility, create creative application. These take time. You have to use it every single day, multiple times. Company leaders, let your people use the LLMs; keep your data separately. Use it uh, using it for spotting trends and doing stuff. It's a starting point for research. Cannot agree more. As I've highlighted, I I've replaced Bloomberg with that function with perplexity.
Uh, the robot revolution is within 5 years. This is not something way down the road. This is something that is today. It's speeding up. That's the point of where we are. Physical labor will be replaced. It's a good thing we have a shortage. AI will democratize intelligence and opportunity. AI is going AI is going to democratize humanity. There are so many benefits that come out of this, but we are in the 5-year period where the displacement will be real. His big bet, Nvidia and robotics, um, it's one of the reasons why we've talked about Nvidia so much on this, but semis in general, uh, including analog semis, which I'll go through. So, big week for this stuff, the rise of embodied AI, lots of robot stuff in the news. This is all from this week. All from this week. I'm not going to read them. You guys can go look them up on your own. You can go watch this uh, figure AI robot video, 20 minutes. Uh, New York Times had an article on it this week. Uh, you can see the types of people that are investing uh, in this. This is not just a minor thing. This is a large amount of money that are involved in it. Nvidia's confirmed that their revenue in it has surged, and it's not a small number. It's up to half a billion dollars uh, in quarterly sales uh, in May.
Uh, Jensen Huang also endorsed Elon Musk. He thinks Tesla's headed for a multi-trillion dollar future. You have to think about the fact that he's talking about the robotics thing and mentioning Tesla in this. Tesla's a big customer, but I think it just highlights where Tesla is on this and where Optimus is. They're not being viewed as that yet. When that starts to happen by the end of the year, you'll get it. Adam Jonas at Morgan Stanley, one of my favorites, did put this piece out a few weeks ago, the robots are coming. I would go spend time reading on it. Uh, one of the things that stands out, he listed the 100 humanoid part of the value chain; 37 of them in the chain are Chinese companies. So, right off the bat, you're dealing with an Asia story, a China story. Uh, but with inside the industrial chain, 73% of firms are based in Asia. So you're really dealing with Asia as a as a as an important part of this. We've talked about uh, why Rare Earth Minerals stopped the trade war uh, particularly with China. They went back to some agreement. If you read the local Chinese papers, they're saying nothing has changed uh, with the announcement, but the market didn't respond to it. So, we're just at a point where whatever has happened, the details, we don't know everything. Uh, but I'm telling you, for military reasons, rare earth is needed. If you want to go read about how Israel is going to build back up their Iron Dome, they need more rare earth. Uh, there there's other types of materials and things that are needed. It's one of the reasons that speculation happened as to why the bunker bombs were dropped. This couldn't last much longer because of the rare earth side. Again, this relationship of the globe and where we are in technology is the driving force. The lei is useless. You need to be focused on the main thing that shows up, which is AI and robotics.
Tesla's robo taxi hit the street. This is also embodied AI. This is the think of this as a humanoid on wheels. Same type of need for reasoning and inference and learning. Waymo applies for New York City testing. Uh, I can only imagine the uh, the outrage that'll happen. If you remember the strikes from Uber, now we're going to have driverless in New York. Uh, as Pomp said on our uh, weekly podcast yesterday, there's going to be a firestorm for Waymo. We just saw them in California. That was from riots. I think there's I think we're going to be in a labor situation as more and more of this goes on. So, where are we in the humanoid robot investment cycle? So I just went through, you've got electronic related to DeepMind, Figure AI with OpenAI, basically the types of people that or companies and people that are involved; we're at a very, very early stage uh, they say late 90s for smartphones uh, early 10s for EVs, wherever you want to go, the buildout is happening now, and they are racing and raising massive amounts of capital; so where are the alpha opportunities? The semis, obviously, ly. Um, you can go through these on your own, but there's a lot of different things that go that are going to show up. Uh, Apptronik, Figure AI, 1X, the bigger the biggest companies. We are in the pre-iPhone moment for humanoids, and we are accelerating much, much faster than we were back then. Uh, the Asia story connected to it. I've highlighted this chart. It continues to drag the semis. The semis, this is equal weight semis, which gives you both the analog and the AI. We are rising rapidly towards the Cosby. The Cosby is leading again. You know the connection now between AI robotics. Uh, Micron uh, anticipates uh, DRAM shortage, copper prices. Um, this has frustrated people. Again, I want to emphasize the point of AI over LEI.
So right now electrification is big for copper. Everyone's been frustrated that copper just never accelerates. It goes up, it goes down, it goes up, it goes down. If you want a great sharp ratio play, you get long AI copper. You get short old economy nickel. Let's just use nickel. Look at that beautiful sharp ratio since ChatGPT was launched. Uh, so if you get long copper, short nickel against it. Those are the types of things you have to do. You have to take one side of your brain and think how do I invest in AI? And then on the other side, you go, I hate the LEI economy. I need to short something. Go find something to short. This is coming up with new pair trades, sharp ratios that work. As long as it's got the AI side to it, you're going to be able to go through this. This is not a shortage situation right now. This will just continue to be something AI-driven use cases for copper. I list them out here again. ChatGPT, not list them out. I asked ChatGPT to give me all the positive use cases and then give me all the nickel cases and then do a comparison. Copper is the clear winner for AI use cases. Data centers major role, nickel very little. This is what you have to do using AI is go in and ask the question on whatever thing you're interested in. Don't tell it what to do, just ask it. And it says be long copper, short nickel if you want to be playing long AI. Those are the types of things that right now are starting to get built into the market more and more.
The next one, power. I'll keep pounding the table on the fact that we do not have enough power for what is going on. Dylan Patel from SemiAnalysis uh, who did a great job at the beginning of the year kind of throwing this deep-seek thing and just still talking up Nvidia the whole time. The weakness of the US grid isn't just the lack of power; it's also the lack of mechanism to keep it stable. I expect a training run to plunge hundreds of thousands of people into a blackout. Uh, this will make normies anti-AI infrastructure. There's solutions we can implement though. We are going to have to spend money. So what does Trump plan? Executive order to boost energy supply for AI development. He had announced the the nuclear side, but that's not enough. Um, this is becoming completely obvious to everyone that we are way behind China, as you can see in this chart. Uh, electricity generation 99 through here just continues to go higher. They are so far ahead, and whoever wins the energy battle wins the AI battle. So, you are going to have massive dollars spent on the power side. And so, what does that mean? Again, I wrote a Chevron Exxon piece. You have to think outside the box. You have to go find things that will work. Uh, you're going to have to pay attention to everything that could possibly keep us up with China over the course of the next few years.
All right. Now, for the big shift and kind of let's take everything that we did today. Uh, we've got concentration. AI is driving concentration. So less winners, fewer jobs created by the winning firms. So as these ones get bigger and bigger, they're not uh, adding headcount. That means labor is losing to capital, deepening the wealth inequality and causing economic resentment and socialism to rise. A president is elected to address economic pain. That's Donald Trump was elected, and he's still trying to help the median voter. So the housing stuff, anything to move lower rates, the debt is too large to sustain high rates. So they have to debase, they have to inflate their way out or grow their way above interest rates. So they need nominal GDP to be above it. So if we move rates to 1%, the question is how high of the inflation. That is the bet that I would be making as well. uh, the dollar will weaken, but the inflation side at this point has every sign that it's under under control, and AI is going to be an incredibly deflationary force over the course of the next 5 years, particularly as label and wages are under pressure. So what happens? You got tensions between the Fed, monetary and fiscal policy at odds. Global leaders no longer want the dollar as a reserve currency. So what starts to become it? Crypto gains political champion. So the leaders of the US are now pro-crypto, and stable coins start to rise as a bridge currency. I'm going to repeat the death of capitalism. So that's where we are with robotics coming and everything. This is the official ending. You can doubt it. You can keep going. The global reserve currency, and then I just went through a list of 10 things. They all argue for being along this. This has consolidated now near the prior highs. I think this thing is about to explode. Here's five waves up, consolidation. It's just a question of when. And again, I think it will be driven by an expansion in crypto, but also Friday was expiration, uh, the big expiration for Bitcoin. So all of that gamma that had been pounded on the market and helped draw volatility low that every time we tried to break out, it got sucked back down except for this one little move lower uh, intraday over the weekend on the back of the bunker bombs. We've been consolidating on Ethereum. Ethereum needs to go higher. As I highlighted last week, I don't think we can have the type of move I'm expecting in Bitcoin without Ethereum and Solana to go higher. Uh, here's the Solana chart again, five waves up, corrective move there, impulsive, corrective; the next move should be higher, and if it is, this will be a third wave of some uh, level.
Uh, it's already happening inside the traditional finance world. Coinbase shares uh, hit first record since 2021. So since before the chaos of 2022 uh, which we have not taken out yet for the prior uh, for most of the altcoins. The big thing is Circle had the IPO. It's obviously gone through the roof. If you had Coinbase going higher, crypto mining stocks surged this week in takeover rumors from uh, from Core Scientific. If you still need to have a retail explanation for why you should have an allocation, and this is mainly for retail at this point or high net worth individuals, I thought this guy did a great job. Uh, I believe he's got an RIA, but he talked, Rick Edelman on this particular podcast about all the reasons to be longing it. And I thought he did a very, very good job. Uh, and it's not be long it, he's saying you should have somewhere between a 10 to 40% allocation in crypto. Uh, and he goes through the six reasons. It's a new asset class, monetary debasement, which I've covered. All these things I will have covered at some point in here. uh, institutional adoption is happening. Tokenization will be a massive part of this. Everything will be tokenized. Uh, there's no doubt about it. So that's coming. It's already started. The demographic shift as the money is transferred down. Young people believe in crypto. Older people, wealthy people do not. As the money is transferred, you will have it. And we're in the network effects, which I talk about all the time for this. Uh, and so he just highlights, you know, conservatives should have 1 to 5, moderate should have 5 to 10. He also brings up a point that I've brought up before, which is if you're in your 60s, uh, and you don't realize that you're going to live far longer than you imagine because of AI again, you need to have riskier things that will be dominating in 10 years. Bitcoin may not go up to the levels I think this year. Uh, there's no way to stop those trends that I showed because AI will continue to make the situation worse. It is the fuel behind Bitcoin. It is the fuel behind crypto. Getting back to the 1% thing that Trump mentioned, he doesn't realize it, but that's maybe the most MMT, modern monetary theory statement I've ever heard. Again, how do you print money? You have to grow nominal GDP above interest rates. If we can have 5% nominal GDP and we can have 1% interest rates, they can grow their way out of the debt problem. Uh, and that's going to be basically where they're going to try. It seems like even if it's a new Fed person, not until Powell leaves, he's only going to hire someone that's going to look. Trump did speak. Bitcoin reduces dollar pressure. These are all part. So, Bitcoin is part of the plan, which means it should be part of the investment portfolio. This again, I'm I'm mentioning this because there's this PY guy again. Uh, US Fed Housing Finance Agency orders Fannie and Freddie. If you just type Fannie and Freddie into X this week, you're going to get a lot of stuff. I've been speculating that they'll figure out some way to get housing in there. Well, the first thing is they're going to count Bitcoin and crypto as an asset when assessing mortgage eligibility. So, now you can actually use them. That will help people to belong. House plan single vote to move genius and clarity crypto bills. We're still moving forward with that. And then finally for this week, uh, Mastercard partner to allow three billion holders to buy crypto. Uh, I don't know if I'll do a video next week because of July 4th. We'll see if there is large movements. Uh, maybe I'll do a short one just to kind of highlight uh, the second half of the year. We'll see. Uh, but that's it for this week. Thanks. See you next week.