Speaker 1: Everyone, Welcome back to another episode of The Mark Moss Show,
Speaker 1: where we talk about the decentralized revolution, talking about the
Speaker 1: way the world is changing rapidly before our eyes. We're
Speaker 1: looking at through the lens of politics, finance, and technology
Speaker 1: to understand um, like I said, have better context of
Speaker 1: what's going on in the world today. Of course, I
Speaker 1: try to bring to you some education to help change
Speaker 1: the way you think. I bring the latest breaking news
Speaker 1: and some very smart and interesting guests. You don't have
Speaker 1: to listen to me all the time. And I am
Speaker 1: excited to announce I'm in the studio today with Dr
Speaker 1: Jeff Ross. He's the He's the founder of val Shire Cap.
Speaker 1: You can find him on Twitter at val Shire Cap.
Speaker 1: That's Veil veil Shire Cab if you want to figure
Speaker 1: out how to spell it anyway, Jeff, thanks so much
Speaker 1: for joining me today, Mark, thanks for having me. I'm
Speaker 1: really excited to be here. Yeah. Um so if everyone listening. UM.
Speaker 1: At the Bitcoin conference Bitcoin two in Miami, Jeff and
Speaker 1: I and UH and Jeff Booth and Preston Pitchbrow on
Speaker 1: a panel that was that was super cool and I
Speaker 1: was hoping to try to get the four of us
Speaker 1: back together again, but but then things kind of fell
Speaker 1: off the hinges. But anyway, here we are so excited
Speaker 1: to have you back. Yeah, thanks so much. That was
Speaker 1: a lot of fun. It would be fun to do
Speaker 1: a group with those guys again. Yeah, Yeah, I'm gonna
Speaker 1: I'm gonna try to dust that back off and pick
Speaker 1: it back up. My schedule got kind of crazy and
Speaker 1: I had to drop the ball on that, and Preston's
Speaker 1: schedule is pretty pretty pretty tough as well. But um,
Speaker 1: you know, I've been making content since two eighteen, and
Speaker 1: I remember Man two two nineteen, Bear Market h Man
Speaker 1: by two thousand nineteen, and it just was not much
Speaker 1: to talk about. But that's not the problem we have today.
Speaker 1: There's like a never ending amount of stuff to talk about,
Speaker 1: and you're a great person to talk about it with.
Speaker 1: So let's dig into some topics here. I kind of
Speaker 1: want to hit on the very easy, simple topics of like,
Speaker 1: you know, the economy, g d P recession, things like that. Um,
Speaker 1: if we have time, we'll talk about this financial repres
Speaker 1: scition and maybe then we'll get into some assets like
Speaker 1: real estate and bitcoin things like that. Um, before we were,
Speaker 1: before we jumped on, we were looking at this chart
Speaker 1: of the Nasdaq, which will come back to in a minute.
Speaker 1: We'll table that for everybody listening. But um, this week
Speaker 1: was a pretty big week where we had two big
Speaker 1: announcements that came out. So we saw the Federal Reserve
Speaker 1: the FMOC meeting came out and they raised rates again. Um,
Speaker 1: we saw the markets were betting that it would be
Speaker 1: a point seven five, some people thought would be one point.
Speaker 1: Probably didn't matter either way, but it came out at
Speaker 1: the point seven five, and uh, the markets seemed to
Speaker 1: respond favorably to that. And then the g d P
Speaker 1: print came out, which was really bad, but it wasn't
Speaker 1: as bad as the Fed now had predicted it to be.
Speaker 1: And it seems like the markets really like this news.
Speaker 1: What do you what do you make of all that? Well,
Speaker 1: those are great questions. It's it's so hard to discern,
Speaker 1: you know, what what is going on with the market
Speaker 1: because it's so emotional and and uh, there are just
Speaker 1: so many moving parts right now. So as as most
Speaker 1: people probably know, if you if anyone's heard me before,
Speaker 1: I've been pretty barished. I've been bearished since January and
Speaker 1: I've only gotten Yeah, I've only gotten increasingly, beariss. I'm
Speaker 1: one of those annoying guys that nobody likes to be
Speaker 1: around because I bring the mood down of the room.
Speaker 1: You know, why did the Fed act? Why did the
Speaker 1: market act that way to the Fed's announcement. I think
Speaker 1: part of it is because of the verbiage where Powell
Speaker 1: said they basically moved from a comminative to sort of
Speaker 1: uh neutral, uh, you know, a neutral rate right now
Speaker 1: and so and and you know, we were a combinative.
Speaker 1: But people were expecting very hawkish um. They're concerned that
Speaker 1: the Fed is going to continue to have to tighten
Speaker 1: for quite a while if inflation remains sticky high. I
Speaker 1: think what's happening is the market is starting to wonder
Speaker 1: out loud if we may have peaked, if inflation may
Speaker 1: have peaked, and maybe the FED won't have to continue
Speaker 1: to be as aggressive as they've been talking about. I'll
Speaker 1: tell you the other thing I look at, Mark, is
Speaker 1: what what are the treasury yields doing? So what are
Speaker 1: the two ten year treasury yields doing? Both of those
Speaker 1: are um under. I think that the ten year the
Speaker 1: last time I looked at about two point six seven
Speaker 1: or so, and the two year was like two point
Speaker 1: eight generally, when the FED fund rate gets to that
Speaker 1: level and those levels start to drop, so they they
Speaker 1: they've been up right. The ten year got up to
Speaker 1: like three point to three point three is and has
Speaker 1: started coming down substantially. Um. When that gets to about
Speaker 1: where the level of the FED fund rate is, that
Speaker 1: basically forces the Fed's hand. It forces them to stop,
Speaker 1: to take a break, take a breather, and then to
Speaker 1: then switch over to getting dubish again, to get accommodative again.
Speaker 1: Uh So, I think the market is starting to sniff
Speaker 1: all of those different things out. And even though I
Speaker 1: think the economy looks absolutely horrendous right now, and even
Speaker 1: though I think the numbers are going to get worse
Speaker 1: before they get better, um, I'm I'm wondering if we're
Speaker 1: possibly going from bad to less bad, and the you know,
Speaker 1: the risk assets are sniffing that out already. The when
Speaker 1: you say, um, when you say they go to neutral,
Speaker 1: what do you mean by that? What do you think
Speaker 1: they mean by that? That's a nebulous term it and
Speaker 1: they never really answer it very clearly. They basically talk
Speaker 1: about there's this sort of nebulous natural rate that nobody
Speaker 1: can really see. But if we're below that, we're being
Speaker 1: a commendative. If we're above that, we're being restrictive on
Speaker 1: the economy. And there's this little sweet spot where they are.
Speaker 1: It always happens to be right around where the short
Speaker 1: term interest rates are. I would say the free markets
Speaker 1: are better at figuring what that is. So what are
Speaker 1: short term interest rates doing? The right around kind of
Speaker 1: two point seven five to three percent right now? And
Speaker 1: so I think the Fed is sort of going off
Speaker 1: of that and saying, when we're in that ballpark, we're
Speaker 1: basically at a neutral rate. We're not restricting the economy,
Speaker 1: but we're not being a commodative as well. Another thing
Speaker 1: that I saw that they said is that they were
Speaker 1: going to be more data driven, and that to me,
Speaker 1: I love at your opinion, but to me, I was
Speaker 1: afraid that the Fed gets very dug into the positions.
Speaker 1: They want to project way out in front what they're
Speaker 1: gonna do. They don't want to sup as the market.
Speaker 1: So they told us in November they're gonna start raising rates,
Speaker 1: and it didn't happen for months later. They're gonna raise
Speaker 1: for this. They had this whole projection all the way
Speaker 1: through UM and I was afraid they would be dug
Speaker 1: into that, like they were dug into their let it
Speaker 1: run hot theory, and even when things were crashing, they
Speaker 1: were going to stick with that. But when they when
Speaker 1: they said they would be more data driven, then it
Speaker 1: made me think, well, maybe they do sense to the
Speaker 1: point you said that markets are seeing that cp I
Speaker 1: might come down, and uh, if the markets are are
Speaker 1: crashing and CPI is coming down, maybe they would respond
Speaker 1: to the data as opposed to being stuck in their
Speaker 1: in their dug in their position. I think so. It's
Speaker 1: and and you know, I went back and listened to
Speaker 1: that part of it because I had missed that before.
Speaker 1: And I think that's significant. In the last few meetings
Speaker 1: they were saying, we are going to be very hawkish.
Speaker 1: We're probably gonna raise you know, point five point seven five,
Speaker 1: you know, possibly even one is on the table. This time,
Speaker 1: they didn't mention anything like that. They didn't talk about
Speaker 1: actual rates that they're going to raise. They talked about possibilities.
Speaker 1: But yeah, they talked about being data dependent. And to me, again,
Speaker 1: it's it's what the bond markets are telling them. They're
Speaker 1: looking at the Treasury yields falling. That's usually what happens
Speaker 1: as we head into our session, right, people buy safe
Speaker 1: haven assets, they buy treasuries, so price goes up, yields drop, uh,
Speaker 1: and then that forces the hand of the Fed on
Speaker 1: the short end of the curve. So I think I
Speaker 1: think that maybe the sign I think that's what they're
Speaker 1: watching for. And we're not gonna know. We're gonna see
Speaker 1: the CPI print come out. I think August tenth or something.
Speaker 1: We'll see the July cp I print, and then we'll
Speaker 1: see another print in September um and then the Fed
Speaker 1: will meet again. So it's possible that they're done raising
Speaker 1: rates or may they may try one more time, but
Speaker 1: I think the market will reject them pretty quickly if
Speaker 1: they try to do that. Do you think the CPI
Speaker 1: prints will come down? So when we talk about CPI prints,
Speaker 1: we're talking about the number. So we came up with
Speaker 1: the latest number was nine point one, which was higher
Speaker 1: than whatever eight point six were before that, And so, um,
Speaker 1: do you think that that CPI print you think that
Speaker 1: inflation will come down? I mean, we did see gasoline
Speaker 1: prices come down, but rents make up a huge chunk
Speaker 1: of that basket. They don't move very fast. I mean,
Speaker 1: what do you think the odds of that really coming
Speaker 1: down are I personally do. I do think nine point
Speaker 1: one was probably the peak, although to be very clear,
Speaker 1: I've been wrong before. I thought we were going to
Speaker 1: peak sooner than this. I thought eight and a half
Speaker 1: was the peak before. Um so it has been sticky high. Um.
Speaker 1: But yeah, oil has come down substantially about or so on.
Speaker 1: That drives a lot of the factors and c P I. Um. Yeah,
Speaker 1: rents are kind of coming up, but those are sort
Speaker 1: of lagging indicators anyways. Real estate tends to leg what
Speaker 1: the equity markets do and what bitcoin does and things
Speaker 1: like that. Um Uh. In one thing I've been reading
Speaker 1: this week, inventories in businesses have been building significantly as well,
Speaker 1: and so when you have inventories get built up, what
Speaker 1: happens is there's people just can't afford to buy things. Walmart,
Speaker 1: the CEO was talking about this. Food and gas prices
Speaker 1: are so high that they just can't buy the clothes
Speaker 1: off the shelves anymore. So nobody wants these things that
Speaker 1: will help to drive down prices as well. So I'm
Speaker 1: I think we have peaked that's my guess. Yeah, I
Speaker 1: want to dig more into that specifically, because I think
Speaker 1: there's things the FED really can't affect that are driving CPI,
Speaker 1: and I think maybe over the decade we might be
Speaker 1: some of the lowest. We'll see. We'll talk more about that.
Speaker 1: I want to talk more about a potential recession. Have
Speaker 1: they say that I talk about this chart that you
Speaker 1: and I looked at that maybe is telling us things
Speaker 1: that we didn't think about before. We'll talk about real estate,
Speaker 1: we'll talk about bitcoin and more. Um, you're listening to
Speaker 1: the Mark Mos Show. We're talking about the decentralized Revolution.
Speaker 1: I'm in the studio with Dr Jeff Ross, the founder
Speaker 1: of val Shire Cap. You can find him on Twitter
Speaker 1: at val Shire Cap. And if you're not following me
Speaker 1: on Twitter, you should. It's just at number one, Mark Moss.
Speaker 1: We've got a lot more to cover if you want
Speaker 1: to learn how to navigate this properly, So don't go away,
Speaker 1: We'll be right back. All right, Welcome back. You are
Speaker 1: listening to the Mark Mos Show. We are talking about
Speaker 1: the decentralized revolution each and every week, and this week
Speaker 1: I am in the studio with Dr Jeff Ross. He
Speaker 1: is the founder of al Shire Cap. You can find
Speaker 1: him on Twitter at val Shire Cap. We gotta do
Speaker 1: a panel together at the Bitcoin Conference two in Miami
Speaker 1: this year was really cool and so we're digging back
Speaker 1: into this macro theme. We just kind of talked about
Speaker 1: what the Fed did this week with the raising of
Speaker 1: the rates by point seven five, and um, we didn't
Speaker 1: talk about the g d P print. So, um, we
Speaker 1: also saw that and it looked like the White House
Speaker 1: came out in advance of the numbers and started telling
Speaker 1: us what you see isn't real, what you think isn't real. Uh,
Speaker 1: And they wanted to change the technical definition of of
Speaker 1: of a recession to negative quarters of growth. So that
Speaker 1: was pretty weird. I think, Um, there's some truth to that,
Speaker 1: and we can dig into that if you want. But then, um,
Speaker 1: the Fed now had been predicting i think a negative
Speaker 1: one point six and then the GDP print came out
Speaker 1: a point negative point nine and so it was bad
Speaker 1: but but better. What's your take on that? Well, it
Speaker 1: was basically as expected. I think most people that I
Speaker 1: was seeing estimates anywhere from positive like half a point
Speaker 1: positive all the way down to you know, about negative
Speaker 1: one and a half or so. UM, So I think
Speaker 1: it just sort of fell within range. I think the um,
Speaker 1: the powers that be knew that it was going to
Speaker 1: come out negative. So that's why they came out with
Speaker 1: this and paign this week. Um. You know that maybe
Speaker 1: the technical, technical definition, but that's not what a recession
Speaker 1: really is. Uh. There's this group called the n b R.
Speaker 1: I think it's the National Bureau of Economic Researches, which
Speaker 1: is a group of academics who they they've had the
Speaker 1: privilege of uh declaring an official recession I think since
Speaker 1: the late seventies. Now. The irony of them is they
Speaker 1: are the backward ist of backward looking data people. So
Speaker 1: they usually come about a year later and say, yeah,
Speaker 1: it turns out we were in a recession starting about
Speaker 1: a year ago. So I expect the same thing to
Speaker 1: happen this time as well. I get Yellin's point, and
Speaker 1: I get Powell's point. They're talking about unemployment being very,
Speaker 1: very low. It's they're they're absolutely right, but you know what,
Speaker 1: that's legging legging data again. And so as the economy turns,
Speaker 1: as companies start to suffer, as earnings start to decline, Uh,
Speaker 1: we're already seeing small businesses, which are the most sensitive companies. UM.
Speaker 1: I think it's forty five percent of small businesses are
Speaker 1: already on hiring freezes as of last week. Uh, and
Speaker 1: some somewhere around five percent are actually letting go of
Speaker 1: employees already, so we should see unemployment start to rise.
Speaker 1: And worse than that, I think. I think it's thirty
Speaker 1: five percent of small businesses aren't aren't current with their rent,
Speaker 1: and I think it's sixty five percent of businesses in
Speaker 1: the transportation sector are not current on their rent. They
Speaker 1: can't even make their payments. Um. Of course, the the
Speaker 1: in the consumer sentiment indexes are horrible. Manufacturing sentiment and
Speaker 1: it's all the sentiments are horrible. Um. I think, uh
Speaker 1: think that they'll have to shut their business down within
Speaker 1: the next twelve months. So the sentiments are really bad.
Speaker 1: But they did they did, so the White House came
Speaker 1: out and said, hey, look, that's that's not the technical definition.
Speaker 1: We also have to look at to your point, employment,
Speaker 1: the economy, other factors. But to the point that you
Speaker 1: made about unemployment being historically low or whatever, I think
Speaker 1: that's another one of the CP lie you know, kind
Speaker 1: of made up statistics, because yes, maybe It's true the
Speaker 1: economy added four thousand jobs, but if you look at
Speaker 1: over a core or really we didn't add that any
Speaker 1: because of what we had lost before. But more importantly,
Speaker 1: the labor participation rate, So the participation rate is so low,
Speaker 1: So the employment rate only calculates the amount of people
Speaker 1: that have jobs that are looking for jobs, but doesn't
Speaker 1: take all those people into consideration. And they've also lowered
Speaker 1: it to people who have less than full time employment.
Speaker 1: And I think there's some people that probably have full
Speaker 1: time jobs and part time jobs. So I think that
Speaker 1: really excused the numbers. So while that one data point
Speaker 1: looks okay, if you look at it through multiple data points,
Speaker 1: I don't think that you're bear. So I don't have
Speaker 1: to tell you, right, the numbers aren't really that good exactly.
Speaker 1: I couldn't agree more. And I think they're being extremely
Speaker 1: disingenuous when they talk about these kind of status as
Speaker 1: though you know, we're we're looking healthy, the economy is strong.
Speaker 1: It's just not true, especially if you're a person living
Speaker 1: on the margin. Right, if you're in the lower income
Speaker 1: mechelons of the U s um not only are you
Speaker 1: getting destroyed on the right hand, by high prices, high
Speaker 1: grocery prices, high gasoline prices. You may not even be
Speaker 1: able to afford it with one job, so you're on
Speaker 1: your second job as well. That on the other hand,
Speaker 1: you're at the highest risk of getting fired in the
Speaker 1: next couple of months too, and so it just gets
Speaker 1: harder and harder for those kind of people. Yeah. Um,
Speaker 1: now about the inflation peaked, I mean, you know, we
Speaker 1: can all sit here and guests and speculate on that.
Speaker 1: I think there's a lot of things that are driving inflation.
Speaker 1: So there's I mean, they try to they try to
Speaker 1: classify with cost push and demand pull, right, and so
Speaker 1: the cost push is definitely going up. Costs are going up.
Speaker 1: Gas prices are so high that people can't afford to
Speaker 1: commute any more. So I'll quit my job and I'll
Speaker 1: just stay home and collect unemployment. Now the employer has
Speaker 1: to pay people more to to work that job, and
Speaker 1: so that's cost pushing up. Of course, supply chains and
Speaker 1: the wars and blah blah blah blah blah. But then
Speaker 1: on the demand poll, I don't know what your take
Speaker 1: on this. Is demand pull really categorized as like um one,
Speaker 1: they printed so much more money there's excess demand or
Speaker 1: is it where demand pull is more of a phenomenon
Speaker 1: on where people think that refrigerators is gonna be more
Speaker 1: expensive in the future, so I should buy that refrigerator today,
Speaker 1: or the home is gonna be more expensive, I should
Speaker 1: buy the home today, And so I don't know if
Speaker 1: we're there yet. But either way, I don't see how
Speaker 1: the FEDS policies, I mean, and I guess if they
Speaker 1: completely crushed demand, which I think is what they're trying
Speaker 1: to do, just shut down make everybody feel poor. I
Speaker 1: don't know if they can really affect inflation that much.
Speaker 1: I hear you, I hear you. But I think that's
Speaker 1: what they're trying to do. Whether or not they'll succeed,
Speaker 1: it remains to be seen. I think what they're trying
Speaker 1: to do is to crush demand exactly, and so they
Speaker 1: so as more people on that you know, again at
Speaker 1: the people on the in the lower echelons of the
Speaker 1: income strata, um as they get hit, as they lose
Speaker 1: their jobs, um, they're not. They're not going to be
Speaker 1: able to afford things like they were, even like that's
Speaker 1: what came out with the Walmart results, right, the CEO
Speaker 1: was talking about how people they have to spend more
Speaker 1: of their paycheck on um gas and on food, so
Speaker 1: they just can't buy the clothes anymore. So now we're
Speaker 1: seeing inventories build up at lots of these stores. Um.
Speaker 1: As the inventories build up, people just they the supply
Speaker 1: has become more and more worthless because people just don't
Speaker 1: want these clothes and so so the prices that will
Speaker 1: drive prices down. The other effect, by the way, that's
Speaker 1: related to demand destruction, as real estate comes down, as
Speaker 1: equities come down, the wealth effect of the middle and
Speaker 1: upper classes, the people who own stocks, who own a
Speaker 1: lot of these assets, we're seeing, uh, you know, those
Speaker 1: numbers come down significantly. People are down depending on what
Speaker 1: your what your thing is. If you're an ARC investor,
Speaker 1: you're down fifty um. So they just don't have the ability,
Speaker 1: that the room to buy so many things too. So
Speaker 1: I think that can help drive down prices. But yeah,
Speaker 1: it's anybody's guess. It's so hard to read this system
Speaker 1: right now and what's going to happen. I had another
Speaker 1: I had another Jeff on this week, and Jeff Snyder,
Speaker 1: and uh, you know, he says that the FEDS powerless,
Speaker 1: and I'll release that whole talk the Feds powerless and
Speaker 1: the euro dollar market so big and they can't affect them,
Speaker 1: blah blah blah. Um. He likes to get into the
Speaker 1: technical definitions, and this is where him and I, you know,
Speaker 1: jockey back and forth a little bit, where Um, he
Speaker 1: doesn't really believe in the wealth effect or the reverse
Speaker 1: wealth effect, and I'm just like, I mean, I don't
Speaker 1: have empirical data to show you, but like I wasn't.
Speaker 1: I'm never gonna sell my bitcoin, I'm not going to
Speaker 1: sell my house, but I still feel less wealthy and
Speaker 1: I'm second guessing my vacations. I think the economy is
Speaker 1: gonna be worse than the future and I might want
Speaker 1: to hold on my money today. Like it's affecting me,
Speaker 1: it's affecting everybody I know. Like, so I agree with
Speaker 1: you on the on the wealth effect. It's it's it's real.
Speaker 1: I don't know how to quantify it, I guess is
Speaker 1: the problem. But um, I made a video two weeks
Speaker 1: ago um saying does this mark the bottom? And I
Speaker 1: gave a bunch of data points as to why. And
Speaker 1: it was really partly triggered by that last CPI print
Speaker 1: that had come out. I thought that nine point one
Speaker 1: was a shock and it was going to change everything,
Speaker 1: and I thought maybe that was gonna be the bottom.
Speaker 1: So I wanna I want to talk to you some
Speaker 1: of those data points and then let's speculate on where
Speaker 1: we think that the risk on assets the NASDAC, Bitcoin, etcetera.
Speaker 1: Are gonna go. Um, and we'll talk about that chart
Speaker 1: we looked at before. UM. If you're just tuning in,
Speaker 1: you're listening to the Mark Mos Show. We're talking about
Speaker 1: the decentralized revolution through the lens of politics, finance and technology.
Speaker 1: I'm in the studio with Dr Jeff Rossi is the
Speaker 1: founder of val Shire Cap. You can find them on
Speaker 1: Twitter at val Shire Cap im on Twitter at one
Speaker 1: Mark Moss. We've got a lot more to cover talking
Speaker 1: about the bottom. Don't go away, We'll be right back,
Speaker 1: all right, Welcome back. If you're just tuning in, you're
Speaker 1: listening to the Mark Mos Show. We're talking about the
Speaker 1: decentralized revolution, each and every week, explaining to you the
Speaker 1: madness of the world, how we got here, what's going on,
Speaker 1: more importantly, where we are going. UM. I'm in the
Speaker 1: studio with Dr Jeff Ross. He is the founder of
Speaker 1: val Shire Cap and uh, we are talking about a
Speaker 1: lot of the market movements that happened this week, where
Speaker 1: we're at and where we're going. Now. If you've missed
Speaker 1: any of that, we're not going to recap at all.
Speaker 1: But don't worry. I got your back. You can check
Speaker 1: it out on the podcast. Just search Mark Moss podcast,
Speaker 1: find it on iTunes, the I heart app, or on YouTube.
Speaker 1: Put these up on YouTube as well. UM, so let's
Speaker 1: talk about the bottom maybe so too? We soho I
Speaker 1: made a video um talking about have we seen the
Speaker 1: bottom of bitcoin and really kind of risk on assets
Speaker 1: in general? And what really sparked that was a couple
Speaker 1: of things. One, it was that crazy high nine point
Speaker 1: one CPI print, which you said earlier you thought we
Speaker 1: probably had reversed off of that, but here we were,
Speaker 1: and I think a lot of people were caught off
Speaker 1: guard by that, including the FED. And what I was
Speaker 1: speculating on was that because it was so hot, so
Speaker 1: much higher, the FED would have to respond even more
Speaker 1: aggressively than they wanted to, and then it would move
Speaker 1: their dot plot forward. So they had wanted to raise rates.
Speaker 1: Three now they'd have to be more aggressive move it forward,
Speaker 1: which means they would probably finish raising rates this year
Speaker 1: by the fall of this year. UM and I had
Speaker 1: a bunch of metrics and charts to show that. So
Speaker 1: I thought if if they finished that, that means they
Speaker 1: paused this year. And then, UM, the risk on assets
Speaker 1: moved well in advance of other assets. So when they
Speaker 1: announced when the Fed announced they were going to raise
Speaker 1: rates in November, Bitcoin and the NASDAC made their all
Speaker 1: time highs at that point where the SMPD and make
Speaker 1: a high tel January. And so if risk on assets
Speaker 1: move in advance, then maybe now that the market is
Speaker 1: going to say that they're going to move this forward,
Speaker 1: they'll stop, they'll stop raising rates. Maybe risk on assets
Speaker 1: could start to rebound. And so far it looks like
Speaker 1: that's about the case. Obviously, we won't know until we
Speaker 1: get further down the line and look backwards. UM, but
Speaker 1: you and I were looking at a chart of the
Speaker 1: Nasdaq on a weekly chart back to two thousand eight,
Speaker 1: and man, it's it's it's held up with its market structure,
Speaker 1: and you're a bear. What do you what do you
Speaker 1: think about that? And on the RSI show, is extremely
Speaker 1: over sold, so right right, yeah, yeah, And I'll tell
Speaker 1: you I'm definitely um questioning my bearishness, and I've been
Speaker 1: doing that for the last couple of days, even though
Speaker 1: I've still been fundamentally bearished. It's how can you how
Speaker 1: can you not be with all the damage, with all
Speaker 1: with all the danger out there, exactly so much danger
Speaker 1: out there, but at some point it has to go
Speaker 1: from bad to less bad. At some point we do bottom, right,
Speaker 1: And I'm aware of that. So so I have a system.
Speaker 1: I'm a big fan of not trying to call by thems. I.
Speaker 1: I try to wait until bottoms are confirmed with my system,
Speaker 1: and so I use a lot of moving averages and
Speaker 1: things like that. It's very possible that this move up
Speaker 1: that we've seen in risk assets is what did mark
Speaker 1: the bottom that bitcoin kind of marked at first, and
Speaker 1: equities have followed as well. Um, I'm I'm reluctant to
Speaker 1: say that. Here's why though. In past recessions, if we
Speaker 1: look back at the two thousand and eight two thousand
Speaker 1: nine recession and then the dot com crash from two
Speaker 1: thousand to two thousand two, those were much longer recessions,
Speaker 1: and the common um the average amount of a bear
Speaker 1: market rally. So this this kind of uh um, the
Speaker 1: recent rally that we've seen, the the average amount is
Speaker 1: fifteen pcent during our recession. What we've just seen with
Speaker 1: the with the S and P five hundered is literally
Speaker 1: right around a rally. So either we're just doing exactly
Speaker 1: what we always do in a recession and in big
Speaker 1: bear markets, and we're going to peek and then head
Speaker 1: back down again. That's still what I'm betting on. I
Speaker 1: still think that's what's going to happen. Or we have
Speaker 1: bottom and and these we're gonna retake some momentum indicators
Speaker 1: and we're going to start a new bullish um, new
Speaker 1: bull market. I still remain skeptical, but but I'm I'm
Speaker 1: happy to be wrong if that means we can pivot
Speaker 1: and turn bullish and make money for for our clients. Um,
Speaker 1: you know, I'd rather make money than be right. But
Speaker 1: but we'll see, we'll see what happens. Yeah, you're absolutely right.
Speaker 1: And uh I recently just did a video I've actually
Speaker 1: used many times before, which was the Wall Street Psychology.
Speaker 1: You know you've seen that one where it kind of
Speaker 1: shows and it shows the crash and then there's the bounce, right.
Speaker 1: And so if you look back to the Great Depression,
Speaker 1: you look at the two tho eight crash, you get
Speaker 1: about an initial drop followed by a retrace and then
Speaker 1: it just falls the cliff. And so that's the that's
Speaker 1: the typical pattern. Like I said, we've seen it many
Speaker 1: times before, and we're kind of right there, right now,
Speaker 1: right there exactly. So we had the draw down, we've
Speaker 1: got the fifth percent retrase, and like maybe it could
Speaker 1: fall off a cliff, right, So that's that's what I'm doing.
Speaker 1: So I'm positioned. I'm kind of neutral right now, and
Speaker 1: based on my trading system, it's it's sort of leaning
Speaker 1: neutral because I don't know whichever we're gonna go. We
Speaker 1: could completely fall off a cliff and that would make
Speaker 1: total sense to me, or or maybe it is the
Speaker 1: start of a new bowl market. We'll see. I had
Speaker 1: another one of our our mutual friends on a week
Speaker 1: ago and uh, Lawrence Lepard, and uh, he thinks that
Speaker 1: he agrees that the FED. His base case, I should say,
Speaker 1: none of us know. We make assumptions and we assigned
Speaker 1: probabilities to them. Right. His base case was that the
Speaker 1: FED would most likely pivot by the fall, by by
Speaker 1: the election mid terms. But he thinks that we have
Speaker 1: a massive crash between now and then. That's it, that's
Speaker 1: his base case. Um, but I don't know, man, I'm
Speaker 1: I'm I'm the eternal optimist, right. We always have to
Speaker 1: be aware of our own bias, right, and I'm the
Speaker 1: eternal optimists. Always have to check my my optimism bias. Um.
Speaker 1: We know, we know what reality is. But man, the
Speaker 1: central banks are pretty good with magic. It appears, you know,
Speaker 1: it's it's tough. That's what makes investing so interesting is
Speaker 1: you just don't know. And like you said, it's all
Speaker 1: about probabilities. And so this is the first time since
Speaker 1: January where I'm at about a probability, Like, I don't
Speaker 1: know if it's going to go higher lower. I'm just
Speaker 1: following the system and we'll see. I might just be
Speaker 1: sitting in cash for a while until a direction gets
Speaker 1: proven out. Yeah, I'm certainly with you on the direction right,
Speaker 1: not trying to catch a falling knife. I like the
Speaker 1: right trends. I always talk about. I'm a surfer, so
Speaker 1: I ride waves, so I look for the storm. I
Speaker 1: go to where those waves are going to go for
Speaker 1: the storm and then I wait and I ride the
Speaker 1: wave when it gets there. So that's how I think
Speaker 1: about investing. Look for the look for the storm, position yourself,
Speaker 1: and then wait for the trend to develop, as opposed
Speaker 1: to trying to catch that falling knife. Um and yeah,
Speaker 1: nothing nothing wrong with being in cash right now today, UM,
Speaker 1: let's talk about let's talk about real estate. I see
Speaker 1: I've seen you talking about real estate a little bit before.
Speaker 1: I made another video recently about about real estate, and um,
Speaker 1: I was talking about it from a couple of different ways, right,
Speaker 1: and uh, I think as investors, and you might agree
Speaker 1: with me or feel free to disagree with me, but
Speaker 1: we we we can't call tops and bottoms until we're
Speaker 1: looking backwards on them, and so we just try to
Speaker 1: think about when things are cheaper expensive. And so if
Speaker 1: you look at real estate from a case killer index perspective,
Speaker 1: it's very expensive. It's never been more expensive. But um,
Speaker 1: as I showed in this video, like homes are purchased
Speaker 1: with a loan, so nobody buys the house what they
Speaker 1: buy as a payment, right, and so then you have
Speaker 1: to look at the affordability index and so like, well,
Speaker 1: what's the you know, what's the payment versus the income?
Speaker 1: And then and then you have to look at what's
Speaker 1: the rent versus buy. When it's cheaper to rent, people rent.
Speaker 1: When it's cheaper to buy, people buy, And you have
Speaker 1: to kind of look at it. I argued from those perspectives.
Speaker 1: But then I asked a question, and I don't know
Speaker 1: the answer. So I'm gonna ask you this question. I
Speaker 1: put it out to the to the the audience, and
Speaker 1: and I got a mixed bag of results. But if
Speaker 1: real estate will not if since real estate has basically
Speaker 1: seen increase over the last decade, when something moves up
Speaker 1: that strong and fast, isn't a correction healthy and expected?
Speaker 1: And so if we got a pull back or pullback
Speaker 1: in real estate, is that a correction or at what
Speaker 1: point does it become a crash? Well? Yeah, I mean
Speaker 1: that's when you just get into technicalities right in definitions.
Speaker 1: I agree with you that it's healthy. And I think
Speaker 1: that's the problem with the centrally controlled financial system that
Speaker 1: we have is the FED and the central banks don't
Speaker 1: allow for these corrections, these you know, these reversions to
Speaker 1: the mean when we see prices go up so far
Speaker 1: and so fast in these assets like real estate, like equities,
Speaker 1: like other things, they continue to prop them up every
Speaker 1: time they start to correct again. And so so I
Speaker 1: think it's very healthy and I think it should correct.
Speaker 1: In fact, I would love for real estate to overcorrect
Speaker 1: to the downside. You know, that's probably not what investors
Speaker 1: want to hear, but at least in the short term,
Speaker 1: it has become so unaffordable that it's pricing out. You know,
Speaker 1: millennials and gen's ears are having a tough time buying
Speaker 1: houses because of the prices that have gone so high.
Speaker 1: So I would love to see them pull back substantially,
Speaker 1: uh for the most part. And I would love to
Speaker 1: see some of the huge investors, like the black Rocks
Speaker 1: and these private equity firms that owned tons of real estate,
Speaker 1: I'd love to see them own less, honestly, uh, so
Speaker 1: that I could get back to more of a reasonable
Speaker 1: valuation for first time homebuyers. Um. I think that's one
Speaker 1: thing that if we do get a pretty good recession,
Speaker 1: that's one thing that could happen, and that would be
Speaker 1: a healthy reset. So I think of corrections more is
Speaker 1: just like you, a healthy reset, uh. And that's and
Speaker 1: that and that's a good thing. It's a good thing
Speaker 1: for capitalism in general, a good thing for investing. Yeah,
Speaker 1: I don't know. There could be danger there with black croc.
Speaker 1: I'm gonna talk about that danger in a minute when
Speaker 1: we come back here and listen to the Mark ma Show.
Speaker 1: We're talking with Dr Jeff Frost. We're back in a minute.
Speaker 1: Don't go away, all right, Welcome back. You're listening to
Speaker 1: the Mark Moa Show. We're talking about the decentralized Revolution, politics, finance, technology,
Speaker 1: and of course we're talking about bitcoin as the technology
Speaker 1: changes the world as we know it. I'm in the
Speaker 1: studio with Dr Jeff Ross, founder of val Shire Cap.
Speaker 1: You can find them on Twitter at val Shire Cap
Speaker 1: and we've been talking a lot of things about the economy,
Speaker 1: the GDP prints and inflation and so forth. But back
Speaker 1: to the comment you said about real estate for a
Speaker 1: second there. You know, Uh, one thing that you said
Speaker 1: just kind of caught me was to see some of
Speaker 1: this wash out, maybe some of these black rocks that
Speaker 1: are buying up all the real estate. But what I'm
Speaker 1: afraid of is this, uh you know, own nothing to
Speaker 1: be happy, so to speak, and like every time we
Speaker 1: have these crashes, it seems like a way to transfer
Speaker 1: wealth from the rich from the port of the ridge,
Speaker 1: and so, um, look at the two thousand eight financial crash, right,
Speaker 1: what happens in a parabolic run. You start sucking in
Speaker 1: more buyers and eventually the market runs out of buyers
Speaker 1: and then it crashes off. And so, whether that be
Speaker 1: the dot com boom or the real estate market in
Speaker 1: two thousand eight, or whatever bitcoin market you want to
Speaker 1: call it, but in two thousand and eight, everyone started
Speaker 1: buying homes. People were lining up and they're buying five
Speaker 1: homes or ten homes and at a time or whatever, right, um,
Speaker 1: And and it sucked in more more people. So oh
Speaker 1: four oh five, oh six, I mean it sucked in
Speaker 1: the most amount of people. But then it crashed and
Speaker 1: then millions of people lost their homes. And then it
Speaker 1: was the black Rocks, not specifically Black Rock, but the
Speaker 1: but the Wall Street funds that went and just snapped
Speaker 1: them all up. Got basically free money, had all this
Speaker 1: unlimited financing, and so it really transferred home ownership from
Speaker 1: the individual millions of individuals two institutions, and then the
Speaker 1: individuals became renters. And so while I would love to
Speaker 1: see the black Rocks get shaken out, I'm afraid they have.
Speaker 1: Actually I saw a report this week like fifty billion.
Speaker 1: I think it said sitting on the sidelines, ready to
Speaker 1: snap up real estate. So to the point, I'd love
Speaker 1: to see them washed out, I'm afraid we see millions
Speaker 1: of people loser home and then they deployed this fifty
Speaker 1: billion and they've become an even bigger player. And that's
Speaker 1: where these booms and busts that that that happened. I
Speaker 1: don't know what what's your thoughts on that? Well, that's
Speaker 1: just how it works, right, I mean, it's the The
Speaker 1: name of the game, honestly is liquidity, and it's do
Speaker 1: you have access to liquidity during the boom time so
Speaker 1: that you can you can juice your games? And then
Speaker 1: during the bear times there is estionary times. Do you
Speaker 1: have a stockpile of cash sitting on the sidelines or
Speaker 1: something liquid, some sort of good collateral. Most regular people don't.
Speaker 1: Most people don't think like that. They don't plan for
Speaker 1: a rainy day, They don't save up, you know, five
Speaker 1: thousand dollars sitting in their banks so they can buy
Speaker 1: some cheap houses when we hit a recession. But black
Speaker 1: Rock does, and they have access to capital, they have
Speaker 1: access to the credit markets. Um, that's just kind of
Speaker 1: how the Fiat system is wired. And the people who
Speaker 1: play the Fiat system game really well, they just make
Speaker 1: endless amounts of money. Uh. And that's why we see
Speaker 1: and I know you talked about this all the time,
Speaker 1: but these massive, huge inequality gaps for for you know, income,
Speaker 1: Like it's the rich get richer, the poor get poor,
Speaker 1: and that's just the name of the game for the
Speaker 1: Fiat system unfortunately. So then what lessons can we learn
Speaker 1: from that? And this is something I've been thinking about
Speaker 1: a lot lately because in two thousand eight, I was
Speaker 1: all in on real estate and I had done really well,
Speaker 1: sold multiple businesses in different sectors. But I was all
Speaker 1: in our real estate. When it cracked, I got wiped out,
Speaker 1: My income was wiped out. I couldn't take advantage of
Speaker 1: all those sales. But I saw other people who came
Speaker 1: in was able to get some credit lines and snap
Speaker 1: them up and there in a completely different position than
Speaker 1: than I was. Um. And so then to the point
Speaker 1: that you just made, which I agree with, So thinking
Speaker 1: about it like that, then I guess people should try
Speaker 1: to think the opposite of what they typically do so
Speaker 1: maybe instead of trying to deploy all the capital now,
Speaker 1: maybe stockpile not only their capital, but also maybe try
Speaker 1: to really work on building their credit lines. Sure, and
Speaker 1: then that's the best you know, that's the best FIAT solution. Absolutely,
Speaker 1: there's lots of tricks and for that. And that's what
Speaker 1: I used to talk about pre bitcoin, like what do
Speaker 1: you do you know, build up strong credit lines, build
Speaker 1: up savings you know, uh, earn more than you spend
Speaker 1: and all those kind of things. Invest wisely and uh
Speaker 1: and prepare kind of rainy day funds and think about
Speaker 1: it from a kind of a more longer term perspective,
Speaker 1: like how to be a Warren buffet, uh, individually for
Speaker 1: yourself and for your family. I tell people these days,
Speaker 1: I think the smartest thing to do is actually just
Speaker 1: dollar cost average into bitcoin. Like, if you have very
Speaker 1: little money, put a little bit of that, even if
Speaker 1: it's ten percent, so say it's even like five bucks
Speaker 1: a week or ten bucks a week, um, put that
Speaker 1: into bitcoin. Because bitcoin does what basically homeownership used to
Speaker 1: do or should do for people, That builds your equity. UM.
Speaker 1: So if you just kind of don't even think about
Speaker 1: it and just put it in it's sort of like
Speaker 1: paying off your mortgage. You're just building your equity whether
Speaker 1: you want to or not. You know, that's the nice
Speaker 1: thing about having these automated systems. You're just building equity
Speaker 1: and the Bitcoin financial network, and then over time your
Speaker 1: net worth will grow as bitcoin appreciates some value. Yeah. No,
Speaker 1: I couldn't agree more. Obviously, I talk about bitcoin all
Speaker 1: the time on this show. Um But another thing I
Speaker 1: want to talk about. We only have a couple of
Speaker 1: minutes left, but is this this financial repression? And so
Speaker 1: really when nations get into deep debt, there's only a
Speaker 1: couple of ways out. They can default, that doesn't really work,
Speaker 1: Austerity doesn't work. They can tax the way, but that
Speaker 1: won't work, and so then their last option is kind
Speaker 1: of like the financial oppression, which is basically forced people
Speaker 1: into buying government debt and bonds and then give them
Speaker 1: negative rates so they'll pay you three or four percent
Speaker 1: while we have seven eight sent inflation. And that seems
Speaker 1: to me the most most likely outcome. I mean, we're
Speaker 1: already in it, right. The I m f is put
Speaker 1: out papers in it that we're already seeing that. Um one,
Speaker 1: do you agree with that? And if to then, Um,
Speaker 1: in that type of environment, do you think bitcoin is
Speaker 1: still the best place to go? And I think I
Speaker 1: think you're totally right on I completely agree with you.
Speaker 1: And I think that you know, they have these four options.
Speaker 1: I think what they always choose if they have the
Speaker 1: ability to print money, that's what they're gonna do. They're
Speaker 1: gonna print money. They're going to debase the the the
Speaker 1: purchasing power of their population in order for the government
Speaker 1: to survive. So it's on the backs of their citizens, which,
Speaker 1: by the way, I hate it drives me crazy. Bitcoin
Speaker 1: for the first time, though, gives people a way out,
Speaker 1: and so I'm a little less optimistic for government that
Speaker 1: it's going to work as well this time around. I
Speaker 1: think what they're going to try to do is get
Speaker 1: American citizens to hold cash and hold treasuries and then,
Speaker 1: as you say, they're going to basically inflate the value away. Uh,
Speaker 1: you know, they're going to debase the value of the
Speaker 1: US dollar, So the people who are stuck holding the
Speaker 1: treasury are basically going to just just watch their purchasing
Speaker 1: power evaporate over the next couple of years. Um, we
Speaker 1: actually can opt out with bitcoin, and I think Normally
Speaker 1: I would say go to gold, go to heart assets,
Speaker 1: but I think bitcoin is the best of those worlds
Speaker 1: right now. So I think it's extremely wise to to
Speaker 1: UH to preserve your purchasing power in bitcoin. It's sort
Speaker 1: of outside. It's a parallel financial system that can't be
Speaker 1: touched or affected in the same way that these other
Speaker 1: assets can. Yeah, I like to say that when when
Speaker 1: the government's continue to print an unlimited amount of fake
Speaker 1: fiat currency, then you want to hold hard, real things
Speaker 1: that they can't inflate, and so that that that brings
Speaker 1: us back to bitcoin, which is something they can't create
Speaker 1: more of UM, and that certainly looks to be like
Speaker 1: the most likely outcome UM until something breaks, which we
Speaker 1: don't know what that is. But I think I think
Speaker 1: about in terms of like the law of diminishing returns,
Speaker 1: and right we can already see that each each time
Speaker 1: they have to pump the bubble back up, it takes
Speaker 1: more money. So it's seven hundred billion tar been two
Speaker 1: thousand and eight, and it was I know, seven trillion
Speaker 1: in twenty and what's the next one going to be?
Speaker 1: Twenty twenty trillion? And then it just affects less and
Speaker 1: less and less and then eventually it just doesn't work.
Speaker 1: But um, who knows, right, Eventually people don't want that
Speaker 1: currency that you keep, uh, you keep creating more and
Speaker 1: more and more of Eventually people look at it and
Speaker 1: be like, why would I want this? If you can
Speaker 1: print twenty trillion of it, you know, over a year
Speaker 1: to to debase your currency and pay off these unpayable debts,
Speaker 1: what's the point of even holding it? And so that's
Speaker 1: when people start hoarding hard assets, start hoarding bitcoin and
Speaker 1: golden real estate as well. Yeah. I just I just
Speaker 1: covered in uh an article earlier before you came on. Um,
Speaker 1: the Cato Institute put out so basically the Fed, you know,
Speaker 1: they're trying to do the Central bank digital currency. They
Speaker 1: opened up for comment and they had thousands of comments
Speaker 1: that came in. Cato Institute went through all the data
Speaker 1: and sixty of the respondents are completely against the Central
Speaker 1: bank digital currency, which is great, that's great news or four.
Speaker 1: But they don't seem to under stand it, per the responses.
Speaker 1: And so man, if they switched to something like that,
Speaker 1: that could and one of the fears they cited is
Speaker 1: it could actually force people out of the currency even faster. Yeah, yeah,
Speaker 1: it's easy to see that, you know. Yeah, Yeah, it's
Speaker 1: it's it's all of the terrible properties of Fiat to
Speaker 1: begin with, and then it attacks on surveillance with it,
Speaker 1: and so you know, and it's it's it's just it's
Speaker 1: a it's a nightmarish it's or it's an Orwellian situation.
Speaker 1: So so I think I think that would be the
Speaker 1: best marketing ever for a bitcoin if they actually came
Speaker 1: out with that. I agree. So then it gives them
Speaker 1: a way to easily print more money, more stimulus, which
Speaker 1: just the values the currency even faster. And then because
Speaker 1: they were William System, nobody wants to hold it, and
Speaker 1: I mean it's the best marketing they could have. I agree.
Speaker 1: So anyway, man, we've covered a lot. I really appreciate
Speaker 1: you taking the time to join me today. You're listening
Speaker 1: to the Mark Moss Show. I'm in the studio with
Speaker 1: Dr Jeff Ross, founder of al Shire Cap. You can
Speaker 1: find them on Twitter at val Shire Cap that's pronounced
Speaker 1: like veil and shire Cap, and you can of course
Speaker 1: find me on Twitter at one Mark Moss. We covered
Speaker 1: the economy, We covered the data from the Fed, uh,
Speaker 1: did markets bottom and so much more. If you missed it,
Speaker 1: check it out on the podcast You search Mark Moss
Speaker 1: podcast on the I Heart Radio network or on YouTube,
Speaker 1: and uh that's what we got. Thanks so much for listening.
Speaker 1: Until next time,