Transcription
Hello everybody. It's Friday Fire. Welcome to the show. Let's get into it.
Uh, this is titled "The Day or the Week: The Four-Year Cycle Died." And I'll explain why and how things are still very different this time. They've been different since January 2024, and that pattern has not changed. Again, I will prove why with data in a minute.
We'll talk about all the usual stuff: AI, debasement, macro, Bitcoin, crypto, real-world assets, tokenization, and everything else. And a big thank you to Shauny and TD and K8 for being here. Actually, I don't see TND. Where are you, TND? It's Friday. She's out partying.
But let's get into the story. Again, the four-year cycle is dead. Not financial advice. Shout out to Cap Strategy1. Have been following you on YouTube for years and finally decided to join the Patreon community. Thank you for being in here. Better late than never.
First, let's talk sentiment and signals. We are up from the low 20s last week. We're now fear and greed of 33 for the stock market. And the stock market keeps breaking new all-time highs. It's wild. Everybody's scared poopless, and we're still breaking new all-time highs. You can't make this stuff up. It's completely irrational.
And the crypto is at 30, slightly less than the stock market. But again, Bitcoin has just been chopping sideways literally for a week. When I look at the chart, the price it is now is the same price it was Sunday, Monday, Tuesday, Wednesday. It dipped a little bit late Wednesday and Thursday, and now it's back up to around $10600. Nothing has happened. It is super, super quiet, very unvolatile.
And, uh, let's get into the Bitcoin story. What has changed? Rectober. Because we had October, and now I call October Rectober. We're down only 3%, which is nothing. Still, we got six days left to get positive. That's very possible. Remember, all the action is backloaded in the month, typically after the 15th, but it's creeping up there.
And there's some other good signs, too. The Bitcoin ETFs are up for the week. Down last week, but still net so far. And that's just after four days, including Thursday, yesterday, not today. We're up $355.76 million, which is a tidy sum for the month. We're still up big, bigger than September, uh, up over $4.13 billion. So, the ETFs are still taking in money all the time.
Now, this is kind of the big story. The four-year cycle has been exceeded. I did say wait until middle of October to see if it would go long. And guess what? We are going long, ladies and gentlemen. It's hard to believe. Hard to believe. This time is different.
And looking at Bitcoin growth since cycle lows, we can see that Bitcoin has now officially surpassed the elapsed time from the cycle low to cycle high seen in previous bull markets. Whether you're talking 2015, 2018, 2022, all of them, the cycle peaked after about 1,060, 59 days, depending on which time zone you measure, after its prior bare market low to the current cycle. Now, we've moved beyond that duration.
And if, this is crazy, if the average, if we average the elapsed time across the last two full bull market cycles, Bitcoin has already just exceeded the historical mean and is on the verge of surpassing even the 2017 cycle length. So, here we are, my friends. It's gone longer. It's also less volatile. It also pretty much hasn't done much in the last 12 months. And that's all she wrote.
So, for those of you, and I'm not saying, by the way, that it's up only forever. No, there's always a chance that we could tank tomorrow and go to zero. Remember, that's always possible. But it's different. It is very, very different. That's the message I want to get across.
Another thing that's different, too, is Bitcoin is now back in the accumulation zone. Shout out to CryptoQuant. And here, basically, this is the place where it's a very, very good time to buy. And it's bizarre seeing us down here in the heat phase index of extremely cool. This historically has been a good time to buy Bitcoin. To see it this late in the cycle, or even in a brand new cycle, or maybe in a cycle that's up for the next eight years. We don't know. But this is bizarro. Very bizarre.
Last time we saw this buy accumulation level was in January 2025, after the huge run and right at the tariff tantrums when the Bitcoin price fell down to about $75K. So, actually, it was Jan, Feb, March, that type of time frame. Anyway, we're back in the accumulation zone. So, really weird.
And by the way, this is kind of funny, too, because there's people that always believed Bitcoin was a myth, a scam, a Ponzi, all that garbage. They have just started buying. So now they're saying, "Okay, I've waited 15 years. It's time for me to dip my toe in the water." And that's what they're doing now. They're probably looking at this chart as well.
And dolphins, other piece of great news, too. Dolphins. These are the people with at least 100 Bitcoin up to a,000 Bitcoin. They have started stacking and they're growing their one-year moving average and added 700,000 Bitcoin in 2025. This suggests, if history repeats, the bull cycle is not done by no stretch.
Now, I also do believe that these dolphins aren't rich retail investors or whales. As I've maintained since very early last year, you have the sharks and the dolphins, and I believe they represent treasuries, businesses, small businesses. You know, I was talking to a small business the other day, and they had about $150 million sitting in an account, and they consider themselves a small business, uh, you know, selling literally fish. So, um, they're looking what they can do with their treasury. The answer's pretty clear: just buy Bitcoin and wait. As long as you don't need it, you know, the next, if you can lock away that cash and invest it and not have to draw on it for at least the next two years, you're going to be in good shape. So, that's, uh, that's what I believe a lot of these dolphins and sharks are. They are small companies or big companies that are beginning to stack sats, not retail. The retail investor typically doesn't have 100 Bitcoin and definitely not a thousand Bitcoin. Oh, by the way, the median for dolphins is about 356 Bitcoin. So, that's the middle of the range for this actual, uh, cohort.
Also, and I've never been so excited about gold in all my life, but Bitcoin versus gold. This is from Real Vision. They are now sharing a chart of the Bitcoin price with a 188-day lead. We've seen 30 days, we've seen 80 days, we've seen 100 days, 120 days. Now we're looking at a 188-day lead, which also tells us, if history repeats, these things follow each other, which means the bull run could last for another six months.
A lot of people are saying that gold has topped out. Let me check the gold chart real quick. Yes, it looks like it very clearly topped out at about $4,400. It's now under $4,100 as we speak. It just simply went up too fast, too quick, and everything mean reverts. Remember that, my friends, too.
And hello, user BH4. Good to see everybody here. And, uh, I'm just grateful it's Friday. Crypto. Not much crypto news today, but Fidelity, which is a big asset manager with nearly six trillion assets under management, have listed Solana. So now all US customers can now buy Solana within their Fidelity account, which is good. A lot of people have say retirement accounts, 401ks and stuff, and then they move it to their own different account and they manage it themselves. Now they can buy Solana. Diddy. That could bring in some additional flows. And there's lots of rumors that ETFs are being approved because the government is shut down. The final phases are not being completed, things like 21 shares. So hopefully, ah, government, you don't even notice they're closed except for the ETF is missing. But, uh, anyway, hopefully they'll open up in the next week or two.
Now, debasement trade, which is what everybody's now talking about. You know, I've been talking about debasement since 2020, since I started the channel, but this is, this is, this is a really funny thing. Um, Google search. You won't believe this. Everybody's looking up something on Google search. Guess what? They want to learn about debasement. They're saying, "The world in October 2025, what's this debasement trade thing?" And they're going on Google to try to figure it out. Again, all-time high. And me in 2020 was, "Hey, uh, hey everybody, let's talk about debasement and hurdle rates and how money printing is eating you alive, and if you're not making 14%, you're toast. You're drowning." Da da da da. Now the world is talking about debasement. So, it's a really, really great thing to see, and, uh, I'm very happy that the world is catching on to the importance of understanding this. So, well done, planet Earth.
And gold is closing in. We're still talking debasement trade on US dollar reserves. You can see the blue spike here. Big, big change in pattern. Only a matter of time before maybe they eclipse again, especially if the value of gold keeps going up because fiat is going to zero.
And this is another interesting twist. Shout out to our friends in Switzerland. A lot of people from Switzerland actually watch this channel. And, uh, I grew, I cut my teeth, uh, in, uh, Zurich. So, it's good to see all the Swiss here. But this is a cool chart from Robin Brooks. And he basically talks about how in the debasement trade, people are hopscotching, jumping between different safe haven assets. And I always say, everything is a pair. But what I really liked about this chart is you can see the, uh, I think gold is white, and that's XAUUSD, the pair. Remember, everything is a pair. This is gold in US dollars compared to Swiss Franc in euros. And look at how the trade can pair off between these two. So, the Swiss Franc is orange, gold is white. Maybe people are hedging their bets between both because when gold runs hot, you want to move to safety because after a huge spike, you know, you've got to take some profits and rotate out. Maybe you don't have the courage to rotate into Bitcoin, but you certainly have the courage to rotate into Swiss Franc, which is the cleanest fiat shirt in the laundry. By the way, uh, the reason the Swiss National Bank is such a stable currency and runs such a good currency is guess why? They invested in tech stocks over the last five years, heavily, heavily. So, well done to SNB.
Now, real-world assets and blockchain. A quick update on Fridays. Let's catch up what's going on. And this was hilarious. You know the old joke is, at first they laugh at you, and then they mock you, and then they attack you, and then they join you. Whatever that is. But, uh, JP Morgan, guess what? They've just decided to lend you money against your Bitcoin. And it's funny because, um, I know some of the folks at JP Morgan, and years and years ago, we spoke about this. We said, "Hey, what happens if somebody has a bag of Bitcoin? Can they get a mortgage against that and buy some real estate?" They said, "Nope. Nope. Not a real asset." Well, here we are five, six years later. How they are doing it, but to let institutions borrow against Bitcoin and Ethereum, not retail yet, but people like Jack Morris and Strike are letting that happen, as well as many other players. But be careful, never borrow to speculate. So, things are changing very rapidly.
And real-world adoption curves. This is a cool chart from Yashim, uh, regarding how real-world adoption is happening fast and where we are. First of all, early adoption starts with stablecoins. Then private credit, then treasury bills. Treasury bills are where we are right now with things like Maple and BlackRock. BlackRock is basically tokenizing money market funds on blockchain. Hey Trish, thank you for coming. Next is real estate. We got Vlad Tenev from Robinhood wants to do a lot of that. And then non-US dollar stablecoins, then commodities, carbon credits, native bond issuance, public equities. In fact, you could argue public equity is already there, and bank deposits, and on and on. Tokenization of everything is coming. Get ready. It's going to be fantastic, but we're going to get less sleep. That's the only warning sign.
Let's talk about proxies real quick. A cool chart here, uh, that popped up, and it shows you, if you imagine Bitcoin is the same as cash, these are the cash balances in the MAG 7. Apple have the most at $133 billion. Tesla is a little bit out of date now because they now have $41 billion, not $36.8. And on the far left, you got MicroStrategy, $71.1 billion in Bitcoin in cash. And if you compare them to the MAG 7, they are number five on the list after Amazon, Microsoft, Apple, and Google. Nvidia is there with nearly $60 billion, but Nvidia has been spending a lot of their cash on investing in other startups and AI plays too.
And this is a mind-blowing statistic. Fun Lee, the CEO, did an hour-long chat with a guy called Adrian Morrison. I should have calculated this. I'm mad I didn't, but I know exactly that they have purchased 664,500 Bitcoin approximately over 1900 days. But that's 337 bitcoins per day. And the reason that's important is one player, okay, only 450 Bitcoin are issued per day. One player has nearly bought all of that supply. And that's a mind-blowing stat. And yes, I know MicroStrategy is weak. But remember, it was $16 not too long ago. Now it's just shy at $300.
Let's talk about AI and markets. Uh, stock market red, mixed, who cares? Doesn't matter. But I do want to talk about Tesla because they had the big earnings call, and this has to be called out. I, a couple years ago, I wrote a paper about Tesla Energy being probably worth a trillion dollars market cap because they're growing so fast and have so much demand. And that was again years ago. Now Tesla Energy have a 43% compound annual growth rate and 31.8% margins. I beg anybody, with the exception of Nvidia, find me a company with such high margins and such high growth rate. And it's a $12 billion business with massive growth. And it's going to continue to grow because there's going to be infinite demand, data centers for these mega packs. Amazing to see. And that's just one little component of the business which is now making up a lot of the bottom line attribution.
Also, Elon has been very vocal as well over the last few days. He said as well, "We're at a critical inflection point as we bring AI into the real world. People still think it's a car company. Been banging my hand on the table for five years now. It's not." Okay. Tesla is the real, real clear leader in real-world AI. And he said, "Nobody can do what we do." And he knows how hard it is to do what they've done. And he believes Tesla's the highest intelligence density of any AI system on Earth. And it's only getting better. Remember, AI can learn from itself as it goes. Once you have all the compute and all the singular systems and the manufacturing at scale, you and all the data coming in from your vehicles and robots, it keeps on learning. And that's really important to be aware of.
Also, Nick Cruz, um, said as well, this was on the earnings call, "Tesla will be adding reasoning within FSD version 14.3. It's going wide version 14.2 in a couple of weeks. It's coming out very fast. But reasoning, it can literally think like you can, what to do next. Drop the driver off at their destination, go figure out what to do next. Maybe the car will go get a coffee or park itself or charge itself. Who knows? But it's going to use reasoning to solve things in the real world." And people still aren't sure how the car does this. Is it listening? Is it watching? Is it learning? But it's completely wild.
And part of it is now you can see, um, a shock. Ellis Swami had a little video presentation. And what was really cool about this video presentation, it showed you what the robot can see in a factory, but it's not the robot watching a factory. It's a real-world simulation, what they call a neural world simulator. And it's the same type of thing that they use for the FSD vehicles. So they can simulate scenarios on a road. How to avoid edge cases, like dangers like cars coming in front of you, like, I don't know, a train falling out of the sky. Who knows what they're doing in their edge cases. But this same simulator is used now for not just the cars, but also the Optimus. And that is considered a seamless transfer of the brain. This is why they have the age. They have the brain. They have the real-world capabilities. And then they've got the manufacturing at scale. And we just have to see the hand next. Then it's done.
And Financial Times, this is crazy. Absolutely wild. When you have media ridiculing Elon Musk for years and years, now they're coming around all of a sudden. And this was quite a good piece. They talked about how, uh, his pay package could reach an astounding trillion, but they missed the important point. And it's not a company handout. It's a test of the most intense merit ever to pull this off. All the stuff they have to do, $400 billion in profit, EBITDA, as they call it, you know, millions of robots, millions of robo-taxis, millions of cars, millions of everything. It is completely crazy what needs to be done to pull this off. But they believe there's only one person that can do it. And therefore, because he'll 10x all their bags, let him do it. Let him get the pay package. We'll know about the result of that in a couple of weeks.
And Model Y is now again the best-selling car in Europe. Shout out to our friends in Europe over there. You're buying the right car. And then the ICE vehicles don't know what to do next. They lost. This is Ford Motor Company. They lost $1.41 billion on selling very few EVs and over $15 billion in total. The only way they can lose less money now is to sell less cars. And that's why many of the big ICE companies are retreating. You've got Porsche retreating from EVs. You've got Volkswagen retreating from EVs or stopping producing them altogether. Uh, same thing with General Motors and Ford as well. And Rivian just had a headcount. But one company keeps growing. I don't know why. Very bizarre.
And macro, a little bit of macro news too. This ties into Bitcoin, and this is a beautiful chart from Bitcoin Magazine I just had to share. And they talk about the fact that looking at global M2 money supply versus Bitcoin year-on-year basis. What jumps out at me is you can see very clearly, look for the spikes in the teal charts here. They correspond directly to the spikes in the Bitcoin price, which was the top of the bull. Right now, we've had again, just like the Bitcoin price, crunching up, grinding up slowly. Same with global M2, grinding up slowly. If, if global M2 tanks, we tank. I.e., Bitcoin bull market is over. If global M2 continues to crunch up, which I believe it will, we are good to go again. The end of the four-year cycle. This is a cycle driven by global M2. And we have rate cuts coming in. And we have increased money supply, QE, money printing, whatever you want to call it. And the world is a house of debt. And debasement is happening like mad. So, let's watch this very carefully. In fact, it's the only thing you need to really watch out there.
Before we get to the last story, I want to just thank everybody. HBLW, thank you so much. DBF430, QE Labs, Trish Hill, French Dreamer, Piper, and Billy Whiz. Happy Friday, my friends, and everybody for being here. You are just so special to come every day of the week because I'll be here every day of the week.
And 3% of the new 2% inflation goal. For years, I spoke about unicorns and rainbows and 2% inflation and that the Fed doesn't control inflation. Well, now the Fed are talking about 3% being the new goal. They're doing it quietly. They're not saying it publicly, but behind the scenes, you can see they're reacting to it. So, we now have a solid 3% inflation rate, and they're still cutting rates. Think about that. They were going to increase rates till they could bring inflation down to 2%. Now, they gave up the ghost on that. They can't. They see, well, we got 3% and let's just be quiet and keep cutting rates because we have to because everything else is being destroyed. Very, very, what they call, a bizarro world.
And a little bit of sad news, too. Target plans layoffs. Uh, they plan layoffs around a,000 corporate workers and eliminate 800 open roles. That's 2,000 people for a retail store. Uh, Target are going down the same path of Walmart, another retail store. They're leaning into AI heavily. So when people say, "Oh, AI doesn't impact jobs." I call BS on that. The four biggest employers in the United States are all leaning into AI and all cutting jobs. Okay, that's a century. That's Walmart. That's, I can't remember the other two, but four biggest employers. One of the companies I don't even know. Anyway, be careful out there. Stay sharp, my friends. Stay on the cutting edge. Become an asset allocator that will protect your future.
And gold at $4,000, Bitcoin $108. Old joke. Uh, we've seen it before, different prices, but it's always the same. I want to thank you all for coming and, uh, happy Friday. I'll see you all tomorrow. Big thank you once again to the mods on chat. Have a good night.