WEBVTT - Will Bitcoin Go To $12k or $30k First? | Charles Edwards 0:00:00.600 --> 0:00:02.719 We saw in two thousand and eight that the global 0:00:02.759 --> 0:00:05.680 financial markets were really tied together right during the Great 0:00:05.680 --> 0:00:08.360 Footage of rash And it seems like we're only tied 0:00:08.440 --> 0:00:13.360 together even more now. Um, So it seems like it's 0:00:13.440 --> 0:00:15.640 it's even worse now. And and you know, with all 0:00:15.640 --> 0:00:17.680 the trouble and going on in the world. I mean 0:00:17.720 --> 0:00:20.440 obviously yes, looking at the US right being the reserve 0:00:20.520 --> 0:00:21.920 currency of the world, but I mean looking at what's 0:00:21.920 --> 0:00:25.440 happened in Japan with the b O J and in Europe, Um, 0:00:25.480 --> 0:00:28.320 I mean if if, if things deteriorate to a point 0:00:28.320 --> 0:00:30.760 where the EU starts to break apart or the ECB 0:00:31.000 --> 0:00:33.080 starts to default, I mean, is the FED going to 0:00:33.120 --> 0:00:35.519 step in and put that on their back? So it's 0:00:35.520 --> 0:00:37.680 like you kind of still like understand what's going on 0:00:37.720 --> 0:00:39.519 there to understand what might happen to the US A 0:00:39.520 --> 0:00:41.720 little yeah, well yeah, and just look at the old 0:00:41.720 --> 0:00:45.479 the currency paths best, the U S. Dollar, everything's everything 0:00:45.520 --> 0:00:49.120 is struggling, um, you know, the euros down or something 0:00:49.159 --> 0:00:52.479 in that rage and last the last year, Um, just 0:00:53.080 --> 0:00:55.560 they've been so slow to jump on the you know, 0:00:55.560 --> 0:00:59.360 on the gunden with the Fed, right roses and I 0:00:59.400 --> 0:01:00.920 think a lot of kind there's just behind and so 0:01:01.000 --> 0:01:04.560 they're just saying that collect and then you've got extra 0:01:04.720 --> 0:01:09.440 supply side and flash and factor on top. Um. Yeah, 0:01:09.560 --> 0:01:14.440 lots of interesting dynamics putting stresses on systems. Yeah. I 0:01:14.480 --> 0:01:17.160 did a video not too long ago talking about, you know, 0:01:17.160 --> 0:01:20.000 potential breakup of the EU and just how you know, 0:01:20.240 --> 0:01:22.920 the just like all central banks are stuck in this 0:01:23.000 --> 0:01:26.119 proverbial rock and a hard place, UM where inflations raging 0:01:26.319 --> 0:01:28.440 in Europe, the inflation is worse than the US even 0:01:28.760 --> 0:01:32.360 UH inflations raging on UM. So it makes it very 0:01:32.360 --> 0:01:35.240 difficult for them to you know, continue to ease into 0:01:35.240 --> 0:01:37.680 that type of environment. But at the same time, because 0:01:37.720 --> 0:01:41.080 it's a debt based monetary system, a Ponzi system, if 0:01:41.120 --> 0:01:42.840 they don't continue to ease, and the whole thing starts 0:01:42.840 --> 0:01:46.160 to fall apart. And how Europe specifically, right, you have 0:01:46.200 --> 0:01:49.040 Germany kind of being this economic engine of Europe that's 0:01:49.040 --> 0:01:50.760 been this manufacturing now, but then you have the pigs 0:01:50.880 --> 0:01:54.720 nations down south, right, Portugal, Italy, Greece, Spain specifically Greece Italy, 0:01:54.760 --> 0:01:57.520 I mean they're horrible. Grease has had been bailed out 0:01:57.600 --> 0:02:01.400 multiple times UM and so if they continue to rease reach, 0:02:01.440 --> 0:02:04.000 how do those countries continue to get bailed out? Roll 0:02:04.040 --> 0:02:08.880 over there. I suspect, again coming back to the US, 0:02:08.960 --> 0:02:11.959 that we're approaching the late stages of at least the 0:02:12.040 --> 0:02:14.320 aggressive part of the rate rises. I think we're going 0:02:14.320 --> 0:02:18.080 to see those rate rises diminishing size and probably pause 0:02:18.800 --> 0:02:21.519 into either later part of this year or early next year, 0:02:22.800 --> 0:02:26.799 just because we're seeing inflation signs of topping the last 0:02:26.840 --> 0:02:30.320 few months. It's you know, obviously this month individually was 0:02:30.400 --> 0:02:32.400 not what people expected, but if you look at the 0:02:32.440 --> 0:02:34.480 trend the last few months, that has come down quite 0:02:34.480 --> 0:02:36.880 a bit. And if that continues the next couple of months, 0:02:36.880 --> 0:02:39.720 I don't see why, you know, the FED could probably 0:02:40.000 --> 0:02:43.519 quite comfortably say, you know, we've got things under control 0:02:43.600 --> 0:02:46.040 for now, and let's just kind of keep things at 0:02:46.040 --> 0:02:49.480 a consistent relative level, or maybe raise but less aggressively, 0:02:49.520 --> 0:02:53.960 and to see if this trend continues. Um. That's kind 0:02:53.960 --> 0:02:56.320 of my feeling. I think that will put a bit 0:02:56.360 --> 0:02:59.320 of a pressure release on systems in the next three 0:03:00.040 --> 0:03:03.760 About that for a minute, So inflation trending uh to 0:03:04.000 --> 0:03:07.360 maybe maybe down or topping out? Um, I saw you, 0:03:07.480 --> 0:03:10.000 I think put out a tweet just this morning saying 0:03:10.080 --> 0:03:12.080 this is the chart to look at or something like that, 0:03:12.200 --> 0:03:16.120 right that the most bullish world inflation top so, so 0:03:16.200 --> 0:03:19.320 inflation is trending down. There was this video of President 0:03:19.360 --> 0:03:21.239 Biden that just kind of was maybe going a little 0:03:21.280 --> 0:03:24.800 bit viral. Um. He was interviewed on sixty Minutes and 0:03:24.840 --> 0:03:28.080 they were kind of hammering him and they said, uh, 0:03:28.200 --> 0:03:31.320 but inflation still going, is still moving up? And said, 0:03:31.480 --> 0:03:35.640 well it went up an inch? Yeah is it? What's it? 0:03:35.680 --> 0:03:38.880 What's an inch? Yeah? Exactly. I saw that as well, 0:03:38.920 --> 0:03:41.560 and you know it's someone in his position you kind 0:03:41.560 --> 0:03:44.080 of yeah, I wouldn't. I wouldn't put it presented that 0:03:44.120 --> 0:03:47.640 way in the positive scenario that he tried to do. 0:03:47.720 --> 0:03:52.880 I suppose, But yeah, we do have three or four 0:03:52.960 --> 0:03:55.680 depending on your PPI data points down monthly on and 0:03:55.800 --> 0:03:59.560 kind of reduced rights. It's still earlier. I think inflation 0:03:59.680 --> 0:04:02.760 something is probably historically it's been a problem when it 0:04:02.760 --> 0:04:06.880 arises for multiple years. So maybe that it's topped so 0:04:06.960 --> 0:04:09.600 to speak, for now, and that kind of level off 0:04:09.640 --> 0:04:11.560 a bit and come down maybe even to the low 0:04:11.640 --> 0:04:14.760 single digits next year. But it could then you know, 0:04:14.840 --> 0:04:16.760 raise its head in a year or two if it 0:04:16.880 --> 0:04:20.600 depending on sort of macro situations. But I think at 0:04:20.720 --> 0:04:25.039 least for this portion of the you know, the battle, 0:04:25.120 --> 0:04:28.640 so to speak, with inflation, I think we are approaching 0:04:28.640 --> 0:04:32.320 the point where a stance softening, whether that be you know, 0:04:32.400 --> 0:04:36.200 lower rate rises or or just pausing for a few months, 0:04:36.320 --> 0:04:39.560 is close. And I think you just look at the 0:04:39.720 --> 0:04:41.880 massive amount of negative sentiment we have in markets at 0:04:41.880 --> 0:04:45.839 the moment. The put core ratio is it eight or 0:04:45.880 --> 0:04:50.080 something ridiculous, three times worse than two thousand and eight. 0:04:50.080 --> 0:04:52.880 There's a lot of negative sentiment and fear in the 0:04:52.920 --> 0:04:55.120 markets everywhere. And I think as soon as you have 0:04:55.120 --> 0:04:57.560 an event like that with a pause or just reduction 0:04:57.560 --> 0:05:00.240 in rate and then in the in the level of rise, 0:05:00.320 --> 0:05:02.960 we're gonna say a bit of a uh, you know, 0:05:03.040 --> 0:05:04.680 a bit of a balance I would say, laced in 0:05:04.720 --> 0:05:10.880 the near term. So so inflation is trending down. So 0:05:10.960 --> 0:05:13.760 it went from nine point one to eight point five 0:05:13.839 --> 0:05:16.839 to eight point three, right, so it's trending down. But 0:05:16.880 --> 0:05:19.360 if you if you dig into the data, um, if 0:05:19.400 --> 0:05:20.640 you look at it, if you look at the data, 0:05:20.680 --> 0:05:22.480 I mean the CPI data with the government in the 0:05:22.560 --> 0:05:25.200 US is going after from the BLS, it shows um 0:05:25.279 --> 0:05:29.400 that energy is the only thing that went down, right, 0:05:29.480 --> 0:05:33.159 Everything else continued to go up, and energy came down, 0:05:33.520 --> 0:05:37.160 and specifically, well one, it had gone up, I mean, 0:05:37.200 --> 0:05:39.680 depending if you're looking at gasoline or oil had gone up, 0:05:39.720 --> 0:05:41.880 you know, as much as a hundred fifty percent, and 0:05:41.920 --> 0:05:46.120 now it pulled back. So it's still so, I mean, 0:05:47.320 --> 0:05:49.880 it's due for a little bit black. And then you 0:05:49.960 --> 0:05:54.600 have unprecedented releasing of the spr reserves, oil reserves, so 0:05:54.720 --> 0:05:57.320 supply and demand. You dump all this extra supply on 0:05:57.360 --> 0:05:59.839 the market, you bring them down, you get a little 0:05:59.839 --> 0:06:03.080 bit of leaf. But everything else core still went up 0:06:03.120 --> 0:06:06.520 big time. Yes, yeah, yeah, Energy is are a huge 0:06:06.560 --> 0:06:09.240 part of it obviously at the moment um, and that 0:06:09.400 --> 0:06:11.320 is obviously one of the driving factors a lot of 0:06:11.320 --> 0:06:14.920 the change. But I do think also that the tightening 0:06:14.960 --> 0:06:16.800 regime that we're in, where you've got you know, call 0:06:16.839 --> 0:06:20.719 it three to five interest rates over the next twelve months, 0:06:21.920 --> 0:06:24.720 it's gonna put a lot of pressure on on just 0:06:24.839 --> 0:06:28.320 investments in generally, whether it be individual investors in the market, 0:06:28.360 --> 0:06:30.800 but also businesses are looking to start new projects or 0:06:31.240 --> 0:06:35.120 take new actions, any kind of speculation, any adoption risk 0:06:35.200 --> 0:06:37.560 because you have that cash alternative which gives you a return. 0:06:38.240 --> 0:06:40.960 So that's all going to drive down. That stuff takes 0:06:41.200 --> 0:06:45.400 many many months to hit hit markets and subsequently hit 0:06:45.560 --> 0:06:49.640 consumer demand, and um just broader metrics of inflation that 0:06:49.640 --> 0:06:52.480 you're talking about. So you know, we're seeing new housing 0:06:52.520 --> 0:06:55.200 starts in the US, for example, they've really come back 0:06:55.320 --> 0:06:58.679 over the last six six months. Hasn't quite hit housing 0:06:58.680 --> 0:07:02.760 prizes yet, but there's deaf a significant topping structure on 0:07:02.839 --> 0:07:07.440 new housings. So things like that, I think our early 0:07:07.640 --> 0:07:11.840 signs of how people are thinking about spending money. How 0:07:12.120 --> 0:07:14.120 you know, if people are not willing to you know, 0:07:14.120 --> 0:07:16.600 start doing up ground because they're worried about the situation, 0:07:16.600 --> 0:07:18.840 they're starting to tighten the belt a bit, and that's 0:07:18.840 --> 0:07:21.440 going to start to feed out, I believe, into a 0:07:21.480 --> 0:07:24.080 lot of different areas of the economy. So I think 0:07:24.080 --> 0:07:27.760 we will see it it feed into other is not 0:07:27.800 --> 0:07:31.440 just energy, but other areas of inflation. And it's you know, 0:07:31.480 --> 0:07:34.280 it's a twelve months, twenty four months process at least 0:07:34.800 --> 0:07:37.080 to really to see the net impacts of just where 0:07:37.080 --> 0:07:40.080 the rates are today. I would say, yeah, yeah, I 0:07:40.120 --> 0:07:42.160 was reading something last week and it was saying it 0:07:42.160 --> 0:07:44.880 typically takes at least nine months to see the effect 0:07:45.040 --> 0:07:49.320 of the rate increase get its way through the market exactly, 0:07:50.200 --> 0:07:52.920 you know, and then you know, what the Fed specifically 0:07:52.960 --> 0:07:55.960 seems to be doing is trying to destroy the demand, right, 0:07:56.040 --> 0:07:58.680 and so whether that's crushing the real estate market to 0:07:58.720 --> 0:08:01.400 the point you're making, or crushing this ar market. But 0:08:01.440 --> 0:08:03.960 they also need to really affect the employment market, right 0:08:04.000 --> 0:08:07.480 that labor. Yeah, they're they're the enemy of the people. 0:08:08.640 --> 0:08:13.680 Your wage throwing up? Is there problem? Yes, that that 0:08:13.880 --> 0:08:17.360 dull man that you're kind of impossible task they have 0:08:18.560 --> 0:08:20.640 in some respects. Yeah, I think that that is the 0:08:20.640 --> 0:08:22.960 biggest metric that they would be looking at right now. 0:08:23.000 --> 0:08:27.119 As employment. There's a number of I did tweet todays 0:08:27.160 --> 0:08:29.200 was about four kind of metrics at a high level 0:08:29.280 --> 0:08:32.480 of four data points that really monitor for a recession, 0:08:33.040 --> 0:08:36.840 and that would be the key kind of help them 0:08:36.920 --> 0:08:39.679 pace how far they can push the pedal so to speak, 0:08:39.720 --> 0:08:44.680 with tightening. But the biggest ones definitely employment. It's also 0:08:44.840 --> 0:08:47.400 you know, could simply say it's voters, right and how 0:08:47.400 --> 0:08:51.920 it impacts political power structures as well. So it's a 0:08:52.080 --> 0:08:56.880 record lows lowest that's been in about fifty years. The unemployment, 0:08:56.920 --> 0:09:00.439 unemployment right exactly. That's said in a lot us one 0:09:00.520 --> 0:09:02.640 or two months, it's started to tick up a bit 0:09:03.280 --> 0:09:09.400 nothing arguably nothing concerning yet arguably noise. But if you 0:09:09.480 --> 0:09:11.480 have that trend of it continuing to go up for 0:09:11.480 --> 0:09:13.560 the next couple of months, it would look like a 0:09:13.559 --> 0:09:16.440 bottoming structure and unemployer rates and typically when you have 0:09:16.480 --> 0:09:18.840 a bottoming structure, you do end up having a recession 0:09:18.920 --> 0:09:23.640 follow it. Um. It's just kind of that reflexivity. Basically, 0:09:23.640 --> 0:09:26.959 everything compound in the wrong way, and the unemployment rates 0:09:27.400 --> 0:09:30.960 I would say, kind of somewhat lagging towards metrics like 0:09:31.000 --> 0:09:33.320 new housing starts for example. But also all of this 0:09:33.440 --> 0:09:38.640 data is a bit lagging. It's it's monthly, and even 0:09:38.640 --> 0:09:40.480 that the way it's arrogated can be a bit late. 0:09:40.600 --> 0:09:43.920 So yeah, we do we do need some more time 0:09:43.920 --> 0:09:46.880 to confirm that. But I think that is another reason 0:09:47.440 --> 0:09:49.600 if you know, if that does continuous current trend of 0:09:49.640 --> 0:09:52.040 going up a bit later into the year, that's just 0:09:52.080 --> 0:09:55.000 another data point for the FED to Okay, now, it's 0:09:55.000 --> 0:09:57.280 probably a reasonable time to just see what happens if 0:09:57.280 --> 0:09:59.920 we hold rates but they are or just increasing by 0:10:00.040 --> 0:10:08.559 what mm hm. When when you look at the unemployment data. Uh, 0:10:08.600 --> 0:10:12.679 there's the data, the number that the government releases obviously, 0:10:13.120 --> 0:10:16.560 which to your point is very low. Um, And there 0:10:16.640 --> 0:10:19.120 seems to be like the real data that goes into 0:10:19.160 --> 0:10:25.400 making that number. Um. Yeah. So for example, Uh, they 0:10:25.440 --> 0:10:28.760 come up with this data by doing surveys, right, and 0:10:28.760 --> 0:10:31.080 then they have like an adjust an adjuster on top 0:10:31.120 --> 0:10:35.160 of that. So um, they use something I covered this 0:10:35.200 --> 0:10:38.960 in a video and basically, UM, they use this birth 0:10:39.040 --> 0:10:41.640 death factor to see how many new businesses were created 0:10:41.720 --> 0:10:43.360 or how many died, and then how many jobs. And 0:10:43.360 --> 0:10:45.120 then they asked to me how many jobs that would create, 0:10:45.400 --> 0:10:49.240 and they do that based off of the previous year's data. 0:10:49.760 --> 0:10:53.000 So they took this anomaly year where we had this 0:10:53.240 --> 0:10:56.640 massive restart because the whole world was forced to shut 0:10:56.679 --> 0:11:01.160 down open backups, we had all these business start back up, 0:11:01.200 --> 0:11:04.760 all these jobs. They took that data and then extrapolated it. 0:11:04.800 --> 0:11:09.360 So they added three nine thousand jobs um to the 0:11:09.480 --> 0:11:13.640 data that they had, so that it doesn't take a 0:11:14.080 --> 0:11:16.720 data scientist to figure out that was an anomaly year. 0:11:17.960 --> 0:11:22.520 We're grabbing an adjustment of three thousand jobs and adding that. Um, 0:11:22.559 --> 0:11:26.679 that's not normal, So that data is obviously false. Do 0:11:26.720 --> 0:11:30.680 you think they look at that or they're just looking 0:11:30.720 --> 0:11:34.960 at the data the number, yeah, or is it is 0:11:34.960 --> 0:11:38.480 it about selling it to the public. I think that's 0:11:38.600 --> 0:11:42.320 the lot. It is definitely a big part of it. Um. 0:11:42.360 --> 0:11:44.800 I'm sure that you know, I wouldn't just be speculating 0:11:44.800 --> 0:11:46.120 if I guess what they look at. I'm sure I 0:11:46.160 --> 0:11:48.600 look at a lot of different data points. That said, 0:11:49.280 --> 0:11:52.920 they don't have the best track record of of identifying 0:11:52.920 --> 0:11:55.200 this stuff in advance, even you know, they were quite 0:11:55.280 --> 0:11:59.080 late to rising right slast year, for example, so they 0:11:59.080 --> 0:12:01.959 can be a bit behind the curve. Um. I'm sure 0:12:02.000 --> 0:12:06.199 they've got their core metrics, which God may call the 0:12:06.520 --> 0:12:08.520 decision making, and then you've got all this other data 0:12:08.559 --> 0:12:13.960 they probably look out as well. But yeah, the common 0:12:14.000 --> 0:12:16.559 situation just threw a big spark up and down in 0:12:16.640 --> 0:12:19.120 a lot of metrics. So it would be interesting to 0:12:19.200 --> 0:12:21.559 know how they allow for that. Do they smooth it 0:12:21.600 --> 0:12:24.679 out somehow? Do they do they just ignore? Do they 0:12:24.960 --> 0:12:27.240 or do they shift the data and focus on other errors? 0:12:27.679 --> 0:12:29.800 Because you're right, that would that will have a big 0:12:29.840 --> 0:12:33.600 impact and we won't know for for years, really how 0:12:33.920 --> 0:12:36.520 much of an impact I could have. Yeah, and then well, 0:12:36.640 --> 0:12:40.000 just because when you're trying to you know, be forward looking, um, 0:12:40.160 --> 0:12:41.880 trying to figure out where these things are going. And 0:12:41.920 --> 0:12:43.720 so it's like you can kind of like lie about 0:12:43.760 --> 0:12:46.160 the data for so long, but eventually, like the reality 0:12:46.320 --> 0:12:49.160 is going to set in. And so not only that, 0:12:49.200 --> 0:12:51.480 but then we have the increasing jobs, most a lot 0:12:51.480 --> 0:12:53.600 of them more part time, less than forty hours at 0:12:53.600 --> 0:12:57.079 lower rates. So sure we added jobs, but we added 0:12:57.160 --> 0:13:00.480 very low quality jobs and paying jobs of our jobs. Um. 0:13:00.559 --> 0:13:02.800 So when you dig into the data, like the number, 0:13:02.880 --> 0:13:05.880 the number seems okay. The reality is kind of like 0:13:05.920 --> 0:13:07.600 the CEF I see if you came down. But when 0:13:07.600 --> 0:13:12.240 you dig into it, yeah, that's it doesn't look that good. Yeah, 0:13:12.360 --> 0:13:15.560 I don't. I don't pretend to to to argue that 0:13:15.600 --> 0:13:18.600 the sort of macro economy as a whole is seeing 0:13:18.640 --> 0:13:20.880 a lot of a lot of trouble at the moment. 0:13:21.400 --> 0:13:25.840 Just the classic yield curves right there, so negatively inverted 0:13:25.920 --> 0:13:30.840 right now, which suggests that the economy is in medium 0:13:30.840 --> 0:13:36.000 to long term trouble. And they've proceeded recessions by roughly 0:13:36.040 --> 0:13:39.400 twelve months every single time hit rate over the last 0:13:39.400 --> 0:13:42.840 seventy years, so they're negatively invert right now, which suggests 0:13:42.840 --> 0:13:46.120 that we should statistically have a recession somewhere in the 0:13:46.120 --> 0:13:51.640 next twelve or twenty four months on average. So when 0:13:51.720 --> 0:13:55.000 I say that rates will potentially pause and we may 0:13:55.040 --> 0:13:57.760 have a bit of a near term recovery in equities 0:13:57.760 --> 0:14:00.560 markets that could last and don't want to put a 0:14:00.559 --> 0:14:03.880 time number, but it could last anywhere from months to 0:14:03.960 --> 0:14:06.720 a year or potentially a bit more, and then obviously 0:14:06.760 --> 0:14:09.800 will depend on conditions at the time. But as a whole, 0:14:10.360 --> 0:14:13.880 all of these kind of indicators are pointing towards a 0:14:14.040 --> 0:14:17.520 turn in at least the unemployment metrics, right, which, as 0:14:17.559 --> 0:14:20.440 you say, is gonna it's gonna hit jobs at some 0:14:20.520 --> 0:14:24.560 point if we remain in this tightening phase. Let's talk 0:14:24.560 --> 0:14:27.480 about the other four. So, so you said that you 0:14:27.520 --> 0:14:29.800 know the four signs you're looking at. So one is 0:14:29.800 --> 0:14:33.160 the unemployment data, so it is at a very low number. Um, 0:14:33.160 --> 0:14:35.160 whether we can believe the data or not, that's okay. 0:14:35.480 --> 0:14:39.280 At least shows maybe the consumers are buying him. Then 0:14:39.280 --> 0:14:44.720 you had a consumer spending and how strong is yeah, exactly, 0:14:44.760 --> 0:14:46.680 that was still quite strong. And I think you can 0:14:46.720 --> 0:14:49.720 see this big spike in that shot from around the 0:14:49.760 --> 0:14:51.720 Corona period, which no doubt is on the back of 0:14:51.760 --> 0:14:55.000 a lot of economic stimulus and those those checks that 0:14:55.000 --> 0:14:58.080 were coming out, and it is plunging right now, but 0:14:58.320 --> 0:15:00.840 it is still at least on the the data in 0:15:00.920 --> 0:15:03.160 a monthly level, which again is somewhat lagging, and I 0:15:03.200 --> 0:15:05.520 think the most recent data point is a month or 0:15:05.520 --> 0:15:08.360 two old. Anyways, it is on that chart, it's still 0:15:08.400 --> 0:15:12.800 about above the twenty year average. UM. But I think 0:15:12.800 --> 0:15:17.200 that's also a reflection on jobs. Right, so once you 0:15:17.280 --> 0:15:19.920 see them, the unemployer rights starts to tick up, it's 0:15:19.920 --> 0:15:22.920 obviously going to impact the consumer spending. So all these 0:15:22.920 --> 0:15:28.920 metrics are intertwined. UM. But and and unemployment in my 0:15:29.000 --> 0:15:31.480 mind is probably the most important. But yeah, we are 0:15:31.520 --> 0:15:36.840 saying relatively healthy levels of consumer spending. I shared this 0:15:36.960 --> 0:15:39.080 video that the day, So this is like a US 0:15:39.160 --> 0:15:44.240 personal savings plunging down the blue line here, and then 0:15:44.280 --> 0:15:49.480 Federals consumer credit outstanding as increasing. We have like masive 0:15:49.520 --> 0:15:55.080 amounts of debt increasing, consumer savings going down. So the 0:15:55.120 --> 0:15:59.200 spending is happening, But where is the spending happening from? Exactly? 0:15:59.240 --> 0:16:01.200 If if you die of into the dattainel like a 0:16:01.280 --> 0:16:04.040 child like this, it doesn't paint a pretty picture that's 0:16:04.040 --> 0:16:07.960 for sure. Yeah. Yeah, so it's like, um, the data 0:16:08.040 --> 0:16:11.360 at surface level seems to kind of be okay, right, 0:16:12.040 --> 0:16:14.800 but when you dig end of the data and all 0:16:14.800 --> 0:16:17.360 of a sudden, you're like, well wait a minute. Um, 0:16:17.520 --> 0:16:20.440 But even a chart like that is another reason why 0:16:20.640 --> 0:16:23.560 at some point, unless the Fed has lost its mind, 0:16:23.840 --> 0:16:26.600 it cannot keep rising as aggressive it is because it's 0:16:26.600 --> 0:16:31.320 just gonna break, not only businesses but individuals and families. Yeah, 0:16:31.400 --> 0:16:36.960 have high depens like they could continue until things break. 0:16:37.000 --> 0:16:39.280 But I think it's some you know, at a logical point, 0:16:39.360 --> 0:16:41.400 especially when in flash and starting to come back a bit, 0:16:41.440 --> 0:16:45.440 they're going to start to change that. Yeah. This this 0:16:45.520 --> 0:16:47.640 chart was pulled a month ago. I don't have the 0:16:47.720 --> 0:16:49.920 updated chart. This is from eight four you can see 0:16:50.000 --> 0:16:55.320 right here. But consumer credit um skyrocketing right here. Personal 0:16:55.400 --> 0:16:57.360 savings continues to go down, so sort of like the 0:16:57.440 --> 0:17:00.480 last chart we saw, but this is a consumer credit, yeah, 0:17:00.680 --> 0:17:04.520 versus personal savings, and so yeah, spending is still happening. 0:17:04.560 --> 0:17:08.200 But yeah, I agree. I mean, unless the Federal Reserve 0:17:08.240 --> 0:17:11.160 completely has their head in the sand, Um, they got 0:17:11.160 --> 0:17:16.840 to see this data, right, I mean, I'm certainly I 0:17:16.840 --> 0:17:19.600 don't have the whatever thousand PhDs working for me like 0:17:19.640 --> 0:17:21.760 they do. I mean, if I can see you see 0:17:21.800 --> 0:17:25.520 the data, then we have the next Your next indicator 0:17:25.600 --> 0:17:29.560 was the manufacturing the p M I. So that's, uh, 0:17:29.680 --> 0:17:32.720 what what's the p M I and how is it holding? Yeah, 0:17:32.720 --> 0:17:36.440 it's a survey of manufacturing. It's it's above fifty at 0:17:36.440 --> 0:17:40.040 the moment, it is probably one of the less attractive 0:17:40.080 --> 0:17:42.280 looking at the metrics has definitely come back a lot 0:17:42.320 --> 0:17:45.600 in the last six to twelve months. Um. If you 0:17:45.640 --> 0:17:48.080 look at the fifty line on that on that metric, 0:17:48.200 --> 0:17:52.200 when it crosses onto that, it's often again aligned with 0:17:52.440 --> 0:17:55.399 a period before a recession because I don't have the 0:17:55.720 --> 0:17:58.960 months or the jurrectional top of mind, but it has 0:17:59.040 --> 0:18:02.760 occurred frequently before a session, So it's going the wrong direction. 0:18:02.920 --> 0:18:05.600 And that's you know, if that crosses under fifty again, 0:18:05.800 --> 0:18:09.800 another reason later in the year early next year to 0:18:09.800 --> 0:18:14.560 to start to you know, reduced rates a bit or 0:18:14.800 --> 0:18:19.159 so reduced the frequency or the depth of right rises. 0:18:19.800 --> 0:18:22.720 So yeah, it's not it's not trending well, but it's 0:18:22.760 --> 0:18:29.840 still a positive enough level to not trigger immediate action. Yeah. 0:18:30.040 --> 0:18:33.399 And then the fourth one was the bad one, the 0:18:33.440 --> 0:18:37.320 worst one out of all, right, was the real yeah, exactly, 0:18:37.440 --> 0:18:40.960 And I haven't dived into the components that at a 0:18:41.000 --> 0:18:43.240 great level. That said, you can see it quickly in 0:18:43.240 --> 0:18:48.000 a chart, and the real income is very negative, far 0:18:48.040 --> 0:18:50.000 worse than two night And obviously a lot of that 0:18:50.119 --> 0:18:54.920 is going to be inflation related. Nonetheless, it's it's bad. Yeah. 0:18:55.000 --> 0:18:57.960 Going back to that labor market report that I was 0:18:58.040 --> 0:19:03.000 kind of referencing before, so we saw average hourly earnings 0:19:03.119 --> 0:19:06.200 year over year ago up five when we have eight 0:19:06.280 --> 0:19:09.399 or nine percent inflation, so influence, they're not going up 0:19:09.760 --> 0:19:11.720 with the with the rate and and back on the 0:19:11.720 --> 0:19:15.480 point that we made earlier, the FED doesn't once your 0:19:15.480 --> 0:19:18.840 wages going up, that's a problem for them. Yes, And 0:19:18.960 --> 0:19:21.280 if if more people would just wake up to that fact, 0:19:21.400 --> 0:19:25.600 like the FED actively once you're making less money, why 0:19:25.760 --> 0:19:30.320 because it's inflation? Well no, all right, I mean, if 0:19:30.480 --> 0:19:32.080 I have to pay somebody more money to work, then 0:19:32.119 --> 0:19:36.480 I have to raise my prices m M exactly. Yeah. 0:19:37.080 --> 0:19:40.600 So um, it seems like and I think you would 0:19:40.600 --> 0:19:43.919 agree that that the macro picture and you said earlier 0:19:43.960 --> 0:19:46.040 that you're kind of studying more about the U S side, 0:19:46.080 --> 0:19:49.439 but the macro pictures driving the bus here. So I 0:19:49.440 --> 0:19:53.280 want to kind of dive into the risk assets. And 0:19:53.400 --> 0:19:58.560 obviously risk assets have just been completely obliterated November of 0:19:58.640 --> 0:20:00.840 last year when the FED first an nounced they were 0:20:00.840 --> 0:20:03.840 going to start doing it. Where they even did we 0:20:03.880 --> 0:20:07.080 saw the SMP didn't start moving down January. But it 0:20:07.800 --> 0:20:10.639 when when you look at risk assets and can they 0:20:10.680 --> 0:20:13.159 catch a bid? Are we at the bottom? Are they 0:20:13.240 --> 0:20:17.360 cheap or expensive? All these things? Um? Do you think 0:20:17.400 --> 0:20:19.480 the macro picture is the one driving the bus and 0:20:19.520 --> 0:20:23.280 that's really the bigger question overall? Or where are you looking? Yeah, 0:20:23.320 --> 0:20:28.000 it's definitely a huge factor at the moment um. I 0:20:28.080 --> 0:20:32.360 think it's obviously my main focus is bitcoin and crypto. 0:20:32.680 --> 0:20:37.720 When I look at bitcoin exclusively and and different value metrics, 0:20:37.720 --> 0:20:41.400 I look at the many different on chain metrics, everything 0:20:41.800 --> 0:20:45.960 is kind of screaming deep value once and afore kind 0:20:45.960 --> 0:20:50.720 of opportunity of ratings on on multiple metrics. Um. But 0:20:50.840 --> 0:20:53.400 we still have this tight correlation to macro markets, which 0:20:53.440 --> 0:20:56.560 is a big factor. I I do think, as I mentioned, 0:20:56.600 --> 0:21:00.520 I think that a lot of the direction and trends 0:21:00.600 --> 0:21:04.240 that risk assets take in general over the long term, 0:21:04.560 --> 0:21:07.960 if you just look at big time frames, is driven 0:21:08.000 --> 0:21:11.840 by the change in rates of change of Fed and 0:21:11.920 --> 0:21:15.520 monetary policy. So we in November last years you mentioned 0:21:15.760 --> 0:21:17.720 that they basically announced we're gonna have a rate of 0:21:17.800 --> 0:21:21.280 change in the rout and in how rates are increased, 0:21:21.680 --> 0:21:24.120 and that triggered this kind of collapse. And I think 0:21:24.119 --> 0:21:27.840 we're about to see the next kind of transition later 0:21:27.920 --> 0:21:31.040 this year early next year where the rate of change 0:21:31.040 --> 0:21:33.560 of rates will reduce or go to go to zero, 0:21:33.640 --> 0:21:35.600 so the rates will just go you pause at the 0:21:35.640 --> 0:21:38.560 current level at least for some time, and then that 0:21:38.640 --> 0:21:43.600 will cause kind of a trend shift in risk assets 0:21:43.880 --> 0:21:46.520 um Again, may not be long term, but I think 0:21:46.520 --> 0:21:49.440 it will happen, and it could be that we're in 0:21:49.520 --> 0:21:51.159 a recession at that point, or maybe it's a bit 0:21:51.240 --> 0:21:54.920 later or earlier. But people to remember that historically, once 0:21:54.960 --> 0:21:58.200 of recession is announced, it it has been a pretty 0:21:58.240 --> 0:22:01.760 good bye signal and risk asset mark it. So while 0:22:01.960 --> 0:22:06.199 things may look awful, while unemployment maybe rising, it doesn't 0:22:06.240 --> 0:22:08.400 make you know. The equiz market is always looking forward. 0:22:08.400 --> 0:22:11.280 They're always discounting back six twelve months from the future. 0:22:11.359 --> 0:22:16.199 So even if situations are quite ugly, it's it's going 0:22:16.240 --> 0:22:19.520