Are Rate Cuts Dead?

So many people are still playing the old game of fundamentals, and they're not playing the new game of flows. We just have to continue to play the new game of flows. You, as the listener, you as the investor, you as the trader, play the game of flows. Now forget the game of fundamentals. At some point, when the credit cycle resets and liquidity gets drained from the system, the fundamentals game will come back. Maybe. But right now, we're nowhere close.

You've got to know the fundamentals. If you don't know the fundamentals, you'll never have a career. You may have a good year here or there, but you'll never have a career. It's true. You've got to know the fundamentals. But right now, my point is that SpaceX is a purely technical trade through the unlocks. So when does the level end? How? You're collecting gold coins in SpaceX—when does the level end? The level ends when the unlocks occur.

For the broader market, when does the unlock occur? It could be rate hikes. Basically, whenever there's a credit problem, whenever there's a borrowing issue, that's when the level's over and that's when you've got to get out. But we're nowhere near that, and in the broader markets, we're nowhere near unlocks in the near term for SpaceX. So basically, I think that's the right framework to look at equities right now, with SpaceX as a sort of mini technicals microcosm of the broader equity market.

1. What Could Possibly Tank This Market?

What's up, Mr. Jonah?

Peace in Iran. Yay!

We did it. It's over.

It's over.

We've solved the conflict.

Just send in Jared Kushner and everything gets better.

Steve Witkoff, Kushner, Trump. I mean, man. You know, all of those people out there who accuse us of being Zionists—which we are—

All right.

That's it. What's a Zionist? What's that? Hey, you can't show the [bleep], the secret symbol.

No, but—

Delete that, Brad.

People are like, “Man, these 1000x Zionists are going to be so upset at the deal.” I'm actually not. I think that this was probably the best outcome that we could get. Right now, markets are absolutely happy. Markets are ripping. It's kind of incredible, Jonah. Take a step back and think about this, and I want to get your take: We barely had a sell-off. We had a full-blown war with Iran, and we barely had a sell-off. We had the Strait of Hormuz shut, and we barely had a sell-off. What is going to tank the market?

You have to take a step back when things like this happen and start to realize that we really are in a world where these catalysts seem to not be able to crack the story. The story is just massive growth because we're entering into the megatrends of the future. We're just making more money than we've ever made before because the products that are being built are truly world-changing.

Yeah.

The only thing that's going to be able to affect them is—forget war, forget this, forget that—financial engineering, probably, is what brings it down. It's kind of crazy that we went through this whole war and basically ended up in a spot where we probably weren't going to get to a good place with Iran. They definitely, quote-unquote, won this interaction, unfortunately, but nothing happened. It's kind of amazing.

Yeah, I mean, let's just go through all that. I agree that financial engineering is what ultimately torpedoes markets. There's no real sell-off without a credit crisis, right? So if you look at what's causing the sell-off in Bitcoin, the active float in Bitcoin has become Michael Saylor. Michael Saylor has a credit problem, right? That's basically why Bitcoin is underperforming.

When I was a “Dollar Again” options trader back in 2010, early in my career, Kim Jong-un was constantly threatening to nuke South Korea and Tokyo. He went from not really being ICBM-nuclear-capable to being ICBM-nuclear-tip-capable very quickly and was starting to test these missiles. Every time he would do a new launch, he'd say, “I will destroy Asia and America.”

So, is that your North Korean accent?

Yeah, that's right.

This is close. It's good. I thought that was solid. Hop in the chat and tell us what you think of Jonah Van Bourg's North Korean accent.

I should have just used the one from Team America: “I'll kill you.”

That's how we get in trouble. I'm so ornery.

So ornery. That's how we get in trouble. It's the South Park guys, not me.

You should quite literally never run for political office because of all the things that have been said on this podcast. Or maybe in the future they're going to love extremist jokes.

2. From Communist to Republican

We live in Idiocracy, Avi. There was a UFC fight on the White House lawn. I'm pretty sure you could run. And it was so incredible. That was genuinely Americana in a nutshell. I've never seen anything that inspired more patriotism in me than a shot of a UFC fight and seven F-16s flying above the White House, streaming behind red, white, and blue. This was just peak America. There's my new investment thesis: The American century is back on track. We'll talk about that.

So, yeah, I don't want to get too much on a tangent. Just to respond to that, my group chats with my extremely left-wing liberal Columbia friends from university are so upset about the UFC fight on the White House lawn. They're as upset as my conservative, religious Jewish group chats were about the nude drag gay-pride parade on the White House lawn 4 years ago under Biden. Remember all the feathers and gayness? Anyway, I think it's just part of every administration to piss off the other party as hard as they can, right? At least for an afternoon. Getting back on track, only half the country's stoked about that. Back to Kim Jong-il and North Korea.

Well, obviously—sorry, one question, because I wanted to dig in there. Were you a progressive?

Yeah, I grew up—I actually had a communist Russian flag on my wall growing up in Berkeley, California.

So you were a full communist at some point. You kind of understand these people at a deeper level.

Yeah, I mean, put it this way: When I was a child, my parents were hippies. That's why I'm from Berkeley, California. My father was an actual communist, a very prominent lawyer, and my mother carried mail in San Francisco during the Haight-Ashbury era. She came to California in a flower bus. Basically, the thesis back then was that Black people should be able to use the same bathrooms as white people, and—

Very reasonable.

Very reasonable. And we shouldn't send our children off to die in Vietnam for no reason. And, you know, equal rights for everybody—the basics, which I still to this day strongly agree with. Then all those battles were won. The thing about progressive movements is that when they win a battle, they don't just pack their bags and go back to whatever they were doing before, or go back to farming like Maximus in Gladiator. They're like, “Oh, no, we've got to pick the new fight.” Then the fights got increasingly ridonkulous.

That's when I think I did what most traders have to do. My number-one interview question when I hire a trader is: Name the biggest decision you've ever made that involved changing your mind. What's the biggest mind change you've ever made? Because most people just can't freaking do it. If they're born a Democrat, they die a Democrat. If they're long stocks, they can't be short stocks. Traders have to have a mind-like-water mentality: change their mind, be fluid, and adapt to the situation.

For me, I would say, aside from going from turbo-atheist to turbo-religious, the biggest thing I've ever changed my mind on was switching parties when I saw that the ideals I grew up with were no longer part of the party that I identified with. I still consider myself a 1990s Bill Clinton Democrat who just happens to be represented by the Republicans now, not the Democrats. That switch was really tough.

Anyway, back on track: Kim Jong-un would threaten Tokyo and South Korea, and then the yen would puke every time. But it would puke a little bit less every time, because finally the market was like, “Show me the war. Show me the action.”

The same thing is happening under the Trump regime. Equity markets in particular—which we told you were a buy on every sell-off as a result of this Iran war, which we told you would not shut down the economy—we told you to buy when it got resolved because of the barrel count and the critical barrel count versus the noncritical barrel count in commercial storage around the world.

We told you this would happen because, at the end of the day, markets are telling you—or basically daring Iran and Trump—to keep the straits shut. Markets are daring Trump and whoever's in charge of Iran to keep the straits shut to the point where critical oil supplies drop below that threshold that we've been tweeting about and talking about ad nauseam. Until that happens, long only.

3. Collect The Gold Coins Before The Level Ends

And realistically, I think there's too much vested interest in that not happening for it to happen. It's really just going to get to the point where a credit crisis is the only thing that can take us out.

Yeah, no. To your point, yeah.

Yeah, unfortunately, I 100% agree with that. And not necessarily unfortunately, because it's good for the markets to go up. I think that's a very— you know what? Smile, put our 2 thumbs up, and say, “Let's go, markets.” But I say unfortunately because that means that we're going to have to pay very, very, very close attention to what the Fed is going to do.

We're kind of going back into a regime where, for a long time, the economic data that was coming out of the White House and the decisions of the Fed stopped mattering as much. I think we're heading back into a period now where you're going to have to be paying attention to all these things, all these machinations that are going on behind the scenes. This is part and parcel of us talking to you about, “Hey, you have to look at the inflation numbers. You have to look at whether we're going to have hikes or cuts and what's going on there,” because if the economy really starts to struggle, we're going to see some cracks, and those cracks could really impact your portfolio.

In the meantime, what you're supposed to do is gather as many gold coins as possible before the end of the level, and you get reset back to the start. That's kind of how I feel about this market.

That analogy, I love it. Great one. A-plus.

Yeah, thanks, Jonah. I've been playing too many video games recently.

No, no, no. It's so apt because it's like the music's going to stop, or the level's going to end, and you know, run up your score while you still can. The Trump administration will be ending. Their goal is just to turbo-pump your bags. There's going to be a credit crisis brewing. We don't know when, how, or why.

Let's take SpaceX as a microcosm. If I were long SpaceX right now, which I'm unfortunately not, I'm feeling extreme FOMO.

Jonah, we talked about this on the last pod. We said you've got to buy around 160, 165.

Yeah, I got lazy.

I mean, come on. This is something that I actually struggle with, and you struggle with, and every single trader struggles with. You have a plan, you outline it, and then you don't execute on it. I actually notice this in myself when I'm streaming. Sometimes I'll come up with an idea on stream, and I'm like, “Okay, wait. This is a really phenomenal idea. I really need to execute this.” Then I'll just fully, 100% forget about it and not go into it, and then look back on it 5 days later. I'm like, “Oh, fuck me. I really should have executed on this.”

One of the things that I've instituted is what I call the idea journal. This is a very simple concept that a lot of people should be doing. Every time you have an idea, your job as an investor and a trader is to make sure you get a yes or no on that idea—a yes or no from yourself.

If you think, “Maybe I should buy SpaceX at 160,” you can't just leave it there. You write it down. You go, “Should I buy SpaceX at 160? Yes or no?” Write out as much as you can, do the research that you need to do, and then if you come to the conclusion no, you've at least made a decision: no. If you can come to the conclusion yes, great, execute on it. Some of the worst missed trades in my life are the ones that I was just too lazy to make a final decision on. I said, “I'll think about this later.” Then you realize that it just got away from you, and there's kind of nothing you can do at this point because the quote-unquote trade is gone, right?

Every time you have an idea, write it down in your idea journal, and then come to the conclusion yes or no. I'm buying this, or I'm not buying this, and that's going to provide massive dividends for you. You can do it in an Excel sheet, you can do it in a notepad, you can pick up your notepad and use it, but I always suggest having paper and pencil on your desk because that's generally, I think, a good way to form those neural connections in your brain.

Not to go on a complete and utter random tangent, but actually, if you write things down, you remember them better. I want to go on a tangent on that.

That's a great idea. I should do that. I have a journal on my desk anyway. I'm constantly scribbling notes. I should just annotate trades in there. I feel dumb for not doing that.

When I was a locked-in professional trader, I was doing that, now that I think about it, and I was never not doing trades because it was my actual freaking job. Now that I'm just floating around the ether, I don't do that as much. And I should. Sorry, Avi, you're on mute. What were you saying?

No, no, no. I was just saying most people aren't professional traders. I assume most people who listen to this podcast are not professional traders. But if you're not a professional trader, these small frameworks for making sure that you become a more efficient person with your time when it comes to investing are very, very, very important.

I've always been in the world of professional money management, and I've always had a lot of respect for the people who are somewhat successful but aren't. The main reason that I have so much respect is because you have so much less time. But what I realized is that after 8 or 9 years of being a professional money manager, you just get so much more efficient with your time.

When I look at the top people that I know—all of the billionaires that I used to work for—they're sort of maybe spending 30 hours a week actually on the markets and then doing whatever the hell they want to do with the rest of the time because they've gotten so efficient at processing information, understanding what it means, and then really just executing on it.

A lot of people waste time on decision fatigue. They'll have a decision to make and they'll say, “I need more information. I need more information. I need more information.” Suddenly, 10 hours have gone by and you've consumed useless—I mean, you've read Investopedia articles on some company that you're going to invest in, and it has absolutely nothing to do with the thesis that you actually care about. The core thesis here is what matters, and you need to distill it.

I'll use SpaceX as an example. If you buy SpaceX here, you can go deep and say, “Well, the revenues are 18 billion, and compared to Amazon, it's so low, and the valuations are so high, and I don't think Starlink has the right TAM, and I don't think that we're going to get asteroid mining for another 30,” and it's like, enough. That's not what matters. What matters is that there's 4% of this thing on float that index funds have to allocate to it and that retail is obsessed with it, and that makes it a phenomenal trade for the next month, right?

That's what you have to understand. Distill the trade into what actually matters. What is it actually? What are you betting on?

When you bet on Intel, for example, what specifically are you betting on? What actually matters? Are they able to improve on chip design? That's number 1. Are they able to actually compete with TSMC? Is there higher demand for other products that they offer, that they're best-in-class at? CPU usage and whether they're able to innovate on chip design—those are the things that matter.

When you see that—okay, wow—their advanced packaging is being accepted by Google, they're getting a 3 million order of TPUs, that confirms the thesis. Everything else is noise.

Robinhood's another great example. What matters for Robinhood? Are they able to generate more money and higher margins from equities? They made a lot of money from crypto, but are they able to diversify out of crypto and build really robust revenue streams? They seem to be doing that. They got the Trump account.

Right? And are they able to capture the entire lifespan of a consumer into their product? Because they're trying to be the end-all-be-all financial application, and they seem to be doing that pretty well. And so all the other stuff is almost irrelevant. It's: are they doing the core things that will give them 10× value? If their crypto revenues fall, who the fuck cares?

Yeah.

It doesn't matter. Even if their crypto revenue quadrupled, that wouldn't matter. That's not the core thesis. The core thesis is the everything app.

Yep.

So that's my rant on how to evaluate companies in today's day and age.

No, it's a great rant. I've got a few things. It covered a lot of ground, so I have a few different responses. The first: let's go back to SpaceX. SpaceX is a microcosm for the broader market. Let's talk about collecting all the coins before the level ends.

It touches upon a few points you made. You talked about TAM and Starlink and all this shit. Basically, I think you just need to focus on what matters and what doesn't matter. Over the long run, fundamentals matter.

Fundamentals means the TAM of Starlink, the potential of data centers in space, mining freaking diamonds on Halley's Comet, and whatever the hell else Elon is promising, right? The EBITDA of that over the long run is a fundamental issue. In the short run, for SpaceX, this is a high-FDV, low-float meme coin. Fundamentals do not matter.

If you pull a David Einhorn and get short SpaceX because it shouldn't have a $2 trillion valuation on however many billions of revenue and however many fewer billions of profit, Elon will be sending you a pair of short shorts, just like he did for David Einhorn when he got blown out of his entire career. And by the way, that was satisfying, because David Einhorn was the cheerleader for shorting Lehman while I worked there. That was painful to watch on TV every day.

But I mean, he was kind of right.

He was right, but whatever.

Right.

It doesn't feel good to be wrong and have the guy who's right sitting in the front of the class, raising his hand, being like, “Oh, teacher, teacher,” on TV.

Anyway, my point here is that SpaceX fundamentals don't matter right now. Technicals matter. This is a high-FDV, low-float meme coin. Every single person who's got SpaceX stock but can't sell it yet is salivating over their $10 million or $20 million home in Tiburon. Actually, maybe $10 million to $20 million buys you a 2-bedroom shack in the Haight District these days. But a $20 million to $40 million home in Sausalito or Tiburon—these beautiful suburbs of San Francisco—you bet your boots they're going to be selling the second they can.

But they can't. So until then, it's just index buying and retail FOMOing in right now. You can probably be comfortably long. But the level is going to end when the unlocks start happening. If you're long this stuff and you're not mapping the unlocks, you're going to get torpedoed. That's when the level ends. This is also going to go down a lot.

This is what people don't understand. Everyone in crypto thinks they know the game, so they're like, “Let me be contrarian.” Everyone knows the low-float thing pumps, and then when unlocks start happening, it goes down. Everyone in crypto loves to be contrarian, and they love to say, “Well, no, if everybody knows that game, then maybe what you need to do is take the other side.”

And I'm here to tell you, first of all, it didn't even work in the crypto industry. Every time unlocks came, yes, it might pump for a week because they orchestrated something, and then it would just go straight down forever. You have to remember that we are a unique subset of people that have a unique experience.

The vast majority of the world is not thinking about this game. They're not really understanding what's happening. They don't care about the unlocks. That's why everyone missed this entire trade in the traditional world, because they were playing the old game.

So many people are still playing the old game of fundamentals, and they're not playing the new game of flows. We just have to continue to play the new game of flows. You as the listener, you as the investor, you as the trader: play the game of flows now. Forget the game of fundamentals. At some point, when the credit cycle resets and liquidity gets drained from the system, the fundamentals game will come back.

Yeah. But right now, we're nowhere close.

The fundamentals game exists, but if you try to trade things without understanding fundamentals, you will get screwed over the long run. This is the best advice I've ever been given in my entire career. Right at the beginning, at Lehman Brothers, I had a great boss. He was like, “You gotta know the fundamentals. If you don't know the fundamentals, you'll never have a career. You may have a good year here or there, but you'll never have a career.”

It's true. You gotta know the fundamentals. But right now, my point is that SpaceX is a purely technical trade through the unlocks, probably for another year or two. It's like Tesla in the 2010s.

For the broader markets, when does the level end? As you're collecting gold coins in SpaceX, when does the level end? The level ends when the unlocks occur. For the broader market, when does the unlock occur? It could be rate hikes. Basically, whenever there's a credit problem, whenever there's a borrowing issue, that's when the level is over and that's when you gotta get out.

But we're nowhere near that. In broader markets, we're nowhere near unlocks in the near term for SpaceX. Basically, I think that's the right framework to look at equities right now, with SpaceX as a technical microcosm of the broader equity market.

Furthermore, just zooming even one layer back out to what you said about journaling, that's really wonderful advice. I'm actually going to start doing that. I'm probably going to start journaling trade ideas and being a little more active about them and less lazy. That's a great idea.

Also, to your point about how billionaires who are in trading only spend 20 to 30 hours a week on markets and digesting knowledge, it's really interesting. I lived in London for 11 years. The taxi drivers there—maybe they all use Google Maps now, but back in the day it was called the Knowledge. It's a big test: you have to memorize the entire street map of London, which is mind-bogglingly complex.

4. SpaceX Is A Meme Coin: Play The Game Of Flows

It changes their brain chemistry, and they talk about how they can't remember normal things because too much of their neural activity is dedicated to that—or used to be. I don't know what it's like these days.

Anyway, the same thing happens to traders. After having spent 15 years of my life on professional trading floors and then, post-COVID, working a little more from home, there's a constant firehose of information. You develop a very good sense of what matters and what doesn't, and you discard everything that doesn't.

I still to this day have these problems where my wife will start talking to me about something I don't care about, and my face will register—

Jonah, be careful. Jonah, be careful.

Yeah, I know. My face will register the expressions of a humanoid ingesting whatever she's saying, but I'll literally have already forgotten it within microseconds of what she's said if I don't care, because that's how you have to operate as a trader.

You're sitting there in the middle of some oil crisis at Goldman or Vitol, and somebody starts talking to you about their weekend plans. You're like, “Yeah, yeah, absolutely. Uh-huh.” If you were asked to repeat what they just said 3 seconds later, you'd be like, “I have no idea.” Right?

So I have that problem in my personal life. It's literally like your brain chemistry gets altered as a trader as a result of this, but if you want to be successful over the long run and you can't filter signal from noise, you're sort of screwed.

At this point, looking at Twitter—which is the firehose of, let's call it, FinTwit, the firehose of people like us trying to trade Bitcoin, trying to trade SpaceX, trying to trade all this stuff—you have to do the equivalent. You have to filter out all the tweets about Starlink TAM and fundamental blah blah, the Master Plan, Optimus using a mass driver on the moon, and you just have to say, “Who's buying? Who's selling?”

It's a stock-and-flow problem. It's just like Bitcoin after a halving right now. A bunch of indices need to buy. Maybe the S&P 500 needs to buy. Check, double-check the rules, check your notes, and then ask: when do the unlocks occur? Let me literally take a note of that in my notepad. That's literally the only thing that matters.

And speaking of that, I do want to give the people the actionable information about what's actually happening here. The way that SpaceX unlocks are happening is that after the first quarterly earnings report, 20% of the stock will come off.

Could be up to 30%, depending on where SpaceX is trading. If it's consistently above 175, then 7% of the stock unlocks at 70 days, 90 days, 105 days, and 135 days after the IPO. Then 28% of the stock comes off after the lockup, after the second earnings report—the second-quarter report. And then the final amount is unlocked after 180 days.

There are no unlocks until August or September, I guess. SpaceX is going to enter the Nasdaq later this month. So, we are at least going, I think, until August without anything major happening. Obviously, those unlocks are 100% going to be front-run. 100%. I just need to say that again for emphasis. So, you probably want to sell 2 weeks before if you own it. There's no bullish unlock here. Those people are cashing out, but that's very important.

The amount of SpaceX on the Nasdaq-100 is adjusted for float to minimize volatility. Initial buying might amount to $7 billion to $10 billion, according to Barron's. So, again, we're still bullish on SpaceX up until then, but you do have to get a little nervous.

I'm neutral at these prices. I'm not bullish. I'm not buying, or if I were long, I wouldn't be selling either. I'd be doing nothing and watching.

5. Fed Preview: What To Watch From Warsh

I guess one thing that's important to talk about is definitely going to be the Fed meeting today at 2:00 p.m. That's coming up in 22 minutes. It's absolutely irrelevant, in my opinion [laughter], what actually happens, because I think there's a 99.9% chance—97%, it says here—that the range stays put. But what's really going to be important is what the Fed chair, Kevin Warsh, says at his 2:30 meeting, and basically the way that he talks about rate cuts.

What's happened here is that we've basically priced out any chance of rate cuts in 2026. If he says things that might indicate that he's not worried about where inflation is, that he's aligned with Trump, then we could see a rocket in the markets. You really need to pay attention to that, because the way that this is then going to play out is we're going to get the craziest sugar rush that you've ever seen over the summer. Then, probably, if inflation keeps coming in high, that's what sets us up for a real unwind.

Basically, the way that Powell ran the market, which I think was good, is he would let it go and then let it come back, let it go and let it come back. This gave space for valuations to grow and for the market to really work its magic, and to make sure the companies weren't getting too ahead of themselves. The worst thing that can happen to a market—it's all logical at the end of the day—is for it to get way ahead of itself and then have a massive crash, rather than go up a little bit and then come back a little bit, go up a little bit and then come back a little bit. That allows for greater resilience to be built into the markets.

What we want to avoid is Kevin Warsh saying, “Hey, let's absolutely pump the [__] out of these markets, get a massive rally, and then inflation stays high, and then we have to start hiking, and that's going to be really bad.” So, I'm hopeful that he plays a similar game to the way that Powell was playing it, which is, let's bake in maybe 3% to 5% pullbacks to make sure that the market stays healthy, so that people don't get in over their skis, we don't get a massive leverage buildup, and we don't get a massive unwind. So, that's what I'm looking for. Other than that, I think this is going to be a reasonably fine meeting. I don't think it's going to be too crazy.

[Sighs.] If you look at the other thing that I was just looking at, if you look at CDS and high-yield spreads, spreads are fine. They're a little bit—I mean, the U.S. high-yield spread was 275 bps versus a long-term 30-year average of 525 bps. It is tighter than it's been in the past, but there is room there.

Back to the main point here: high yield is not really what matters. What matters is where the mega-scalers can finance and what their credit looks like, because that's what's driving the entire market. Overall, I feel okay.

Yeah. I feel okay, too. When it comes to the Fed, I feel so on my back foot. I don't understand interest rates. I don't understand how the Fed does the thing. I do my best to do some research.

You got to listen to forward guidance and capital flows if you want some real good insight into that aspect of the market.

I mean, no disrespect to Felix. I think he's a G. I don't like following the Fed and its minutiae when we're in a multiyear hike cycle or a multiyear cut cycle. The trajectory is there. Who freaking cares week to week? I'm not trading 2s/10s swap spreads or 2.5s/3.5s swap spreads. It doesn't matter.

What matters is inflection points, and objectively, maybe it is sensible to tune into forward guidance at the moment, because it feels like a cut cycle could suddenly turn into a hike cycle. The reason why I think it won't is because of what just happened in Iran, and we should talk about that. But an ocean of oil is about to flood the market. You're seeing it in crude futures. This is extremely bearish for inflation, meaning I expect inflation to drop globally. Energy is, I think—what is it?—like 10% to 40% of CPI?

6. An Ocean Of Oil & Why Bitcoin Lost Its Way

It was like 35% to 40% of that most recent rise.

Honestly, U.S. gas prices are going back down. It's time.

That's true. Maybe, on the last pod, what we did talk about was turning bullish. We were a little bit nervous for a while, and then we turned bullish on the last podcast. Basically, the market wasn't caring about inflation, and we'd pulled forward the idea of rate cuts. We'd already priced them out—the probability in 2026 went to zero—and the market didn't really care. So, yeah, I'm definitely bullish now.

I mean, here, I'm sharing my screen. Share it. We got to talk about this. This is the Bitcoin MVRV-Z score. It hard-bounced a couple of times off this buy zone when the Z-score is down to around 0.25. You look for indicators like this in everything that you do. To me, oil is the MVRV-Z score for the broader economy right now. Inflation is the threat, and inflation is the driver of whether we stay in a cut cycle or switch to a hike cycle. Oil is the pivot point for that.

Oil just nuked from north of 100 to the 80s, maybe the high 70s. I haven't checked today, but for Bitcoin, MVRV-Z went to the bottom. We're flashing bullish across all of the underlying indicators across multiple markets now. I didn't mean to interrupt an oil conversation with a Bitcoin indicator, but I'm just saying, broadly speaking—

Yeah, the thing about Bitcoin, obviously, that still worries me is that it's lost mind share. I'm bullish on the rest of crypto, but Bitcoin has really just become the Saylor asset, and I think that's just not where I want to put my money right now. We are in apathy mode. What I want is disdain. I want true disdain for this asset to buy it.

You don't think we're in disdain?

Not yet. Just trust me, we're not yet. I know what disdain feels like.

Every crypto professional has pivoted to AI. Literally everyone.

It doesn't matter. We're not grave-dancing yet. People aren't grave-dancing. I think we're going to need Saylor to really talk about how terrible it is. People are going to genuinely start talking about Saylor blowups, how Bitcoin has totally lost its way, and how nobody wants to own it anymore. The traditional media will be grave-dancing on it, and Bloomberg will have a front-page article about, “Is the era of Bitcoin over?” That's really what I want in order to buy it, because there's so much other opportunity in the markets.

We've been extremely bullish on HOOD, for example, for a long time. If you remember, the first time I think Hyperliquid hit, I was sitting here going, “I think the HOOD-to-Hyperliquid ratio was probably really good.” I think Robinhood was trading at about 75 at the time. Hyperliquid was at 60. Now Robinhood's at 108. Hyperliquid's at 75.

Both have obviously gone up, because both are obviously going to have a lot of appreciation just from the fact that they are tackling the traditional financial system and sucking in a lot of volume. But Robinhood was overlooked for a while, and they're really making inroads. They're really making inroads to institutionally capture trading, and I think that Robinhood can outperform Bitcoin over the next 6 months. Why would I bet on Bitcoin when I can bet on something that, if Bitcoin goes up, benefits massively, but also has all these other ways to benefit massively?

Yeah, why—yeah, why another one? Why hyper-gamble on Bitcoin when you can hyper-gamble on Nithya Raman and Spencer Pratt, right? Oh, by the way, breaking news: shout-out to our boy Capital Flows. He just retweeted our stream. So, thank you very much, Mr. Capital Flows. You are the man.

Thank you for amplifying us. We love you.

7. The Iran Deal Is Just A Pause

Go check out the Capital Flows stream. That's actually, more so than forward guidance, what you should be looking at. So anyway, yeah, Bitcoin's not a hyper-gamble asset right now, but once it's low enough, I still have a million-dollar price target. It's obviously replacing the dollar in terms of certain global trade. Should we talk about—where should we talk next? Should we go through the mechanics of the Iran deal and what it means for markets? Do you think people care about that, or do you think we should talk more about other investment asset classes?

And if you haven't watched his stream, you should absolutely watch his stream.

I think that, Chat, if you're listening, toss them some questions and we can do a Q&A here. If you guys have specific topics you want to talk about, literally anything. But I think that people are kind of tired of Iran. I mean, we're over, right? It's in the past now.

It's going to flare back up, in my opinion. It's something to monitor.

Why do you think it's going to flare back up?

I think it's going to flare back up because the current deal is unsustainable. Basically, the gambit is—it's basically a pause. Let's just let the oil stocks build back up. Let's let the Iranian oil build global stocks and fill refinery throughput. Let's just let things normalize for a few months. Let's save our political hides here without getting flayed. And then I think it's going to be right back on.

On the one hand, geopolitically, some strategic things were accomplished, right? If you assume that we weren't totally lied to, I'll just give the benefit of the doubt to the American government for a second. You don't have to actually believe this, but let's steelman it. Let's assume that Iran was, let's say, months away from being able to develop a nuclear weapon and test one successfully. This probably set them back a couple of years. They lost their leadership. They lost a bunch of scientists. They lost a bunch of material. This kicked that can down the road objectively.

Technically, they've agreed to never develop a nuclear weapon, but they've lied in the past, so they'll probably keep trying. That will be a red line for Israel and for the United States. It may or may not be a red line for America depending on who's in charge. If you have people who believe that the ayatollahs can be negotiated with, then America won't care if they have a nuclear weapon. They'll treat it like a Kim Jong-un situation. If you have somebody with Trump's mindset or Marco Rubio's mindset, it is a red line.

But whether or not it's a red line for America, it's a red line for Israel because, no matter who's in charge of Israel, the leadership—even the most left-wing leadership—will never actually believe they can negotiate with Iran. Iran literally has a countdown clock to Israel's destruction in their central square or whatever. So there will be another war, mark my words. This is just a pause.

I think the pause is going to last 9 to 18 months, enough to let oil stocks build back up before we get the next salvo, and the nuclear can has been kicked into or beyond that window. So I think markets should be stable between now and then. That's my take.

I think that's very reasonable. The main problem that I see—and I'm agreeing with you—the main problem that I foresee is that Israel obviously is breaking with the United States in many ways on this Iran deal. And Bibi said himself, “I don't always see eye to eye with Trump.” That means that, you're right, we could see another flare-up.

But I get the feeling that the United States will stay out of it. And if the United States stays out of it, then I don't think Iran does anything to close the Strait of Hormuz. They'd basically have a direct Israel-Iran war, and Iran probably won't hold the world hostage if it's just Israel, because then that would really turn the world against Iran again. Anytime Iran gets into a problem with anybody, the fear just becomes, “Oh, Iran could close the Strait of Hormuz. This is not a tenable situation. The whole world needs to come together and take down Iran.” Does that make sense?

Yeah. So that's one of the main reasons why I don't think that we're going to flare up.

Yeah, I mean, I had—I think the contrarian take there is that if Israel unilaterally attacks Iran, they shut the Strait of Hormuz to try and hold Israel hostage and turn world opinion against Israel.

Yeah, no. I think that's probably right. In the meantime, we've just got to hope that potentially what we get here is a softer Iran because they know that they're less confident than they were before, because a lot of their top leadership was taken out. So I guess we have to wait and see on this.

One outcome that I'm trying to work through right now, to reason about, is: with the war with Iran over and geopolitics seemingly slowing down, there are 2 paths forward here. One, Trump can say, “I've realized that I don't want to have the second half of my term marred by any geopolitical fights. I picked the fight with China over the tariffs. I picked the fight with Iran. I picked the fight with Venezuela.” And because the fight with Iran didn't go particularly well, the first 2 went all right. Obviously, Venezuela was great. The tariff one, I say all right, but obviously it was struck down, so maybe not so much. He's kind of 1 for 3 right now.

It's possible that he just takes his foot off the gas when it comes to geopolitical issues, which would mean the theory, or the thesis, for America First assets might end up weakening, right? For example, the critical-rare-earth thesis that I've had for a long time already, like REMX. That trade I've had on for almost a year at this point. Do I need to get out of that now? This is something that I'm thinking about.

I think potentially, because we might just see less geopolitics—we might just see less conflict in the next 2 years, especially heading into the midterms—that's going to drive a lot less investment into these companies that are protecting America's interests, like USAR and REMX. Less so uranium; it doesn't really have anything to do with this thesis. But I'm thinking, basically, if you're heavily allocated to the America First and defense-contractor thesis, maybe you need to get out a little bit.

We've got the Fed meeting coming up in 5 minutes. So unless anybody has anything else that they want to talk about, maybe we wrap up here, Jonah.

Yeah, let's wrap it. Just as a quick preview, our friends at Morgan Stanley have warned that the Fed under Warsh will adopt a quieter communication style—vaguer, scaled back, fewer press conferences, and reluctance to provide forward guidance.

So again, I'm the wrong guy to listen to on interest-rate stuff, but what I would be looking for is: what kind of poker player is this guy? Does he play with the cards face up or face down? If it's face up, great. We can all make decisions based on it. If it's face down, I don't know. If we're approaching an inflection point in rates, in the trajectory of rates, tighten up the risk.

But again, because oil just collapsed on the back of the Iran stuff, I don't think we're facing an inflection point. I think that was a gift to Warsh. He doesn't have to turn the ship around and stake his early reputation on a potentially disastrous pivot. So I think it's just rates lower for the foreseeable future. Rate cuts are not dead.

Okay, guys, I'll leave you with this.

The market is ripping. You are going to make so much money. Everything's going to go so well for you.

This is—I can't do this. I can't. I'm so fucking bad at this.

You're such an authentic person.

I just can't shill like this. Forgive me.

It's so weird going from managing billions of dollars, basically retiring, and then realizing that this is actually super fun for me and doing this twice a week. I don't think you guys understand. This is really fun for me.

And it's fun for me too, obviously. It's fun for me too. As we learned from the Bankless guys, when podcasters try to trade, it's not fun. When traders try to podcast, it's pretty funny.

It is. It is pretty funny.

All right. Good times. I'm going to jump.

That's what's needed to eventually get acquired for $100 million by somebody later. We are never going to sell out. I'm not selling 1000x ever. Go fuck yourself if you want to buy it.

Right. When traders try to podcast.

Fully go fuck yourself. I don't need your money.

What? If OpenAI came to us and tried to buy me for $100 million, no, I would for sure say yes. I don't know what I'm talking about. I would 100% say yes.

Yeah, if you said no, it would be like the scene in Full Metal Jacket. I would literally strap you to your bed. I'd sneak up on you in the middle of the night, strap you to your bed, and beat you with a bar of soap in a sock until you said you were willing to sell for $100 million. Anyway.

Yeah, no, I'm selling for $100 million. Sorry, guys.

Anyway, this was a fun one. One minute until the Fed release. Nothing's going to happen. Don't worry, guys.