存储器见底了吗？

So, I saw a shocking chart. More and more households are paying for AI. I'm sure a lot of people are on the free tier, but the share of U.S. households with paid AI subscriptions is 2.2%.

1. Save Everything In Your 20s: The Bleecker Street Lesson

What's up, Jonah?

I'm trying something new. I'm trying to channel my inner Alex Jones. That wasn't perfect, but I'll get there. I'm in an echoey room here, so maybe I should try to channel somebody else. We could go, “Let's get ready to rumble.”

Wow. Holy shit. We have to clip that.

Yeah.

And just use that as the start of every podcast.

Jesus Christ. There's actually a drill going on upstairs, which I guess is now the life of a content creator. You have to contend with ambient noise and all that kind of stuff. It's the beauty of living in the West Village in New York.

It's always some nonsense going on. But, Jonah, your neighborhood—I loved the West Village. I lived on Bleecker and Charles. I had basically the entire second story of a townhouse on that corner.

Oh, you lived in a townhouse. That's nice. You did because you were rich or something.

No, it was actually pretty crappy. It was owned—this is an investment lesson—by this landlord guy named Archie Tarpinian. He was like 90 years old and had no email address. I had to deal with him over the phone. He didn't have a management company.

I'm like, I learned that he owned basically 2 entire blocks of the West Village. I'm like, “How did you do this?” I asked him one day, and he was like—he had a super-thick bridge-and-tunnel accent that I don't want to imitate on this podcast, but basically his answer was—

No, you should imitate it. As long as it's not an ethnic accent, I actually think you won't get canceled. I was pretending that I didn't want to, but I can't. Give it a shot. Come on. The people want to hear it.

He's basically like, “Jonah, Jonah, I was a janitor. I was a janitor. I earned—I forget what he said. It was like, ‘I earned 15 cents an hour, and I just saved my money and bought 3 blocks of Bleecker Street when it was a rough area.’”

I was thinking to myself, 3 blocks of Bleecker Street—what year is this? I forget what he said. It was basically the 1930s, or the Great Depression. What now costs $20 million back then cost like 5 grand, and he did it with leverage.

I look back on previous generations. I'm sure previous generations will look back on those of us who didn't buy Bitcoin and be like, “Dad, why didn't you do it? It was so obvious,” much like I look at my parents. I'm like, “Are you serious? You could have bought all this crazy-cheap San Francisco real estate.”

My parents looked at a place on Lombard Street in San Francisco, the famous squiggly street, where the entry-level home there costs like $30 million. They wanted to buy one for like $200,000, and they're like, “Nah, let's live in Berkeley instead and get a $200,000 house in Berkeley instead of Lombard Street.”

You know, not everybody has foresight, Jonah. Not everybody can see the future, unlike you.

I definitely can't. I mean, I have no freaking clue. If you ask me where the next up-and-coming place to buy property is, or where you should go buy to make sure your kids don't have to work and can just live off their generational trust fund, the answer is, I don't know.

But you know what I do know? If you own stocks, if you own Bitcoin, if you invest your money properly, and if you max out your 401(k)—if you're a newly graduated doctor, put all your excess savings into your 401(k); if you're a newly minted analyst, put all your savings into—like, literally, just save as much money as you can possibly save for the first few years of your life. That will set you up to be so much happier down the line.

I know this is called the 1000x podcast, and people are like, “We want a 1000x. We want to find a memecoin. We want to buy that weird black bullcoin, and we want to make as much money as we humanly can in a short period of time.” I'm here to say, listen, buddy: You need to save. The first 5 years of your life, if you can save that money and just plow it in, I guarantee you're not missing out on that much.

It actually becomes so much better once you're 20. If you're a man specifically, if you have a little bit of money at 24, it literally doesn't matter. But if you have a lot of money at 29 to 35, you're great. You're in a great spot. You're having the best time of your life. You're going to have way more fun than having a little bit of money at 24. That's my personal opinion.

So, you're saying people should just save it in cash, or should they just do everything straight into the markets and maybe listen to this podcast? Every now and then, you're going to find some interesting trades to take.

And that's what I would be doing: basically spending as little as possible for the first 5 years of your post-college-grad life, because it doesn't really matter. I guarantee that when I look back at the money that I spent from the ages of 22 to 27, it actually just kind of didn't matter. I didn't really get much out of it, to be honest.

Also, I don't know if that's appropriate, but I'm thinking something weird happened when you turned 26 or 27, and that thing was called COVID. Or maybe that was when you were 25.

I was 25 when COVID happened. I was a young buck, which is crazy. Can you believe COVID was 6 years ago at this point, Jonah? 6 years ago.

It's wild. I can't believe it. Basically, before COVID, prices had some sort of meaning to me. They were sensible. Now, when I buy stuff, I can't even leave my house without spending $100. Prices that would have been a once-in-a-decade purchase are now just normalized.

A business-class flight costs an insane amount—basically what would have bought you a luxury car 10 years ago. I don't understand what's going on with money. I think it has something to do with Joe Biden and the other leaders of the COVID era just printing like $30 trillion.

2. How AI Bailed Out The Everything Bubble

Here's the thing, Jonah: It's not just Joe Biden; it's everybody. Everybody's a populist now. Everybody's just saying that we're going to print money. The beauty of what's happening right now is actually that it's kind of going to be okay.

The reason I say that is because we got ridiculously lucky, Jonah. Historically, what ends up happening in a capitalist system is that people get over their skis. They get overlevered, chasing bubbles and chasing technology. When you look at the dot-com bubble, you look at the railroad bubble—look at literally every bubble that's ever happened—we allocated capital far faster than productivity could keep up. And so you get these massive boom-bust cycles.

Now, what happened with COVID was very interesting, right? You get a ton of money that's printed and pushed into the system. Inflation goes through the roof, and suddenly you're sitting there thinking to yourself, “Wow, we're in a really bad spot. We not only have a ton of debt; inflation is coming in. Maybe there's something good here. Maybe we'll be able to inflate away the debt.”

But the politicians don't really want to stop spending. They all want to keep spending. So how are we going to get out of this, and where are we going to put our money?

People, I think, shoved into equities in many ways to escape the woes of inflation and tried to pull forward a lot of the productivity, which is, again, what you saw during the COVID bubble. You see Meta go through the roof. You see Amazon go through the roof. You see all these stocks go through the roof, right?

But then what ends up happening is chat comes out, and AI suddenly becomes the most transformative technology since the internet. Not only that, it's actually leading to productivity gains, and it's potentially a deflationary technology.

Right at the time that we needed this to happen, it happened. Right at the time that inflation was coming back, right at the time when we were in potentially an equities mega-bubble, we actually generated this incredible technology, and it's kind of bailing us out right now.

I think this is what the bears are not really understanding: The adoption and pace of AI is much faster than the internet. There was a hardware problem with the internet bubble. You needed a computer and an internet hookup in every household in America in order for the average person to take advantage of it.

There's no hardware roadblock here. The roadblock is compute, which we're building a ton of. The way that people get access to AI is very simple: You download it onto your phone, or you open up a website on your computer, which literally the entire world already has. They already have it. It's already here.

3. Has Memory Bottomed?

It's going to progress a lot faster than the internet did because there's nothing in the way. This brings us to the market. That's why, a few days ago—I think it was a week, maybe a week ago at this point. I can't. Time flies like crazy—I said that this is a really good time to get back into the memory trade.

We're off 30% to 40% from the highs. I said maybe we go down another 10% to 15%, which we dipped another 10%. And I said, at that point, I'm all in. I'm very bullish.

Even at these prices—DRAM at 59, Intel at 105—these things are going back to the highs. And I think that as they go back to the highs, you should probably not sit on the sidelines. Obviously, this is not financial advice. Obviously, I could be wrong.

But to me, the probability that the AI bubble is over is quite low. The upside from here is another 2x to 3x before we get something stupid. What I always think of when I see a bubble like this—and then I'll stop ranting and you can take over—is the George Soros model. When a bubble pops, if it doesn't die, it actually comes back bigger the second time.

We just had a 40% drawdown in memory. People are still doubling down. OpenAI just today announced that they're allocating even more money to compute buildout. People are doubling down. Kimmy, the model that rocked the market, ran out of compute, even though they had a distilled, smaller model, right? It's like they ran out of compute. We need more. It's not over.

Because it's not over, to me the risk-reward has shifted. I think that we can go another 2x to 3x from these prices, and on the downside maybe you're looking at another 30% decline. That's a really good trade. Even if you think, let's say, it's 2x minus 30%, and even if you think it's a 50/50 shot, you take that trade.

If you think there's a 50% chance we go up 2x, go back to all-time highs, and then surpass them a little bit, or you think there's a 50% chance we draw down another 30%, it's still good to buy here. That's positive expected value. So I'm sitting here going, all right, time to get back into the memory trade, at least for a bounce, but also stick to what I was saying before, which is that what AI is going to affect downstream is really important now, and you still need to be allocated to it.

This is actually important. Biotech, for example, in this entire massive drawdown in the markets, kind of didn't really move that much, right? A lot of the stocks that we were talking about when we first talked about them are still up a decent amount, whereas from that time period to now, a lot of these memory stocks have come off quite a bit. They're down 30% since then.

So basically what I've done is I've repositioned my portfolio to take advantage of this next leg of the memory trade. But all those profits, as we keep going up, I'm taking them down. I'm taking them down. I'm taking them down and shoving them into the next stage, which I think is biotech, energy, and all these different things. So that's where I am. I also think that Bitcoin is going to do well, but we can come back to that.

4. Only 2.2% Pay For AI: We're In Inning One

Yeah, we'll get to Bitcoin. There's so much in what you just said. You told me to read The Alchemy of Finance by George Soros. It influenced me, as it clearly influenced you. The anatomy of a bubble is very interesting, and let's dig into it.

You said one thing that I think is factually incorrect. Most of what you said is highly insightful. What you said is, “Hey, everybody's already downloaded this stuff onto their phone, and it's a thing.”

Brad, if you could add this to the stage. More and more households are paying for AI. I'm sure a lot of people are on the free tier, but the share of US households with paid AI subscriptions is 2.2%. That is—I looked at this chart and I was like, how is this even possible?

I remember when I was a young buck. Brad, if you could swap out the image here. This is FRED. FRED is like a Fed data service. It's the percentage of retail sales that are e-commerce.

I remember way back in the day when I first started using Amazon, I was like, I wonder how high this Amazon stock can go? What percentage of the world's commerce is transacting online? I was having that conversation with myself back in 2004 or 2005, when e-commerce was 2% of total retail. Now it's like 17%, and the trajectory is just up and to the right. It's going to go to 100%, right? Let's map e-commerce as a thing.

Wait a second. E-commerce is not even 20% of total sales in the US.

That's right. So what I'm getting at here, Avi, is—

I would have been so far off if you had asked me to guess.

What has Amazon stock done over the last 25 years? Has it 100x'ed? I mean, basically—

Maybe all of that is just AWS, but I mean—

Isn't this nuts?

I feel like they got their data wrong. I don't know. I need to look. I need to double-check my priors on this.

They're probably right. I know that they're probably right, but that's shocking.

Yeah, so basically AI—I think I might be [__], though. I don't know. I don't think free AI is going to be that useful in the long run. I think you're going to have to pay for a subscription in order for it to be truly useful. That's a controversial statement, but needless to say, if you want to ask yourself what inning of this bubble we're in, I think it's still inning 1.

If you're comfortable with a 30% drawdown, like you say, that's tremendous risk-reward to be able to 2x to 3x to 5x your money at the risk of a 30% drawdown. I completely agree with you, but that's because I'm a retail investor who's brain-damaged by years in the crypto markets.

Most investors cannot stomach more than a 5% drawdown, or worse, a 10% drawdown, before they start panic-selling or getting force-stopped out. So I think this is a perfect time for anybody who's been in crypto, has risk tolerance, and understands drawdowns to start dabbling in what I think is going to be a megatrend.

Just mapping it back to e-commerce: paid AI, right? I don't think the free tier is where most of the token consumption comes from. The real token consumers have penetrated—it's 2% to 2.5% penetration of the market—and that's just going to go up and up and up.

Eventually, I think 50% of US households will have a paid subscription. Fifty percent of global households will have a paid subscription because that'll be the way to access true intelligence. Ultimately, that money will flow through to assets like Micron, to assets like MSFT, Meta, and all the hyperscalers—Google.

This is an investable thesis, and we're on such a megatrend here that if you can stomach a little bit of a drawdown already, that puts you at an advantage versus the financial incumbents and paper hands, uneducated retail, as I'll call them—unweathered, unbattle-tested retail. What do you think?

So, just to clarify my point on why I said, “Hey, there's actually a roadblock with the internet, but there's no roadblock here,” anybody can do it because everybody has a phone. Everybody can, if they want to and as long as they have the money, very easily go sign up for these tools and very easily start using them. So the roadblock is mental.

We have to differentiate between a mental roadblock and a physical roadblock. People literally didn't have computers in 1999. There was a large subset of society that quite literally was not connected to the internet and didn't have access to computers. Getting that hardware to them is far more difficult than getting somebody over the mental block of downloading AI.

So that's all I'm saying in terms of the adoption and speed at which AI is going to be dispersed: it's easier for AI to move faster. It's just much easier. That's number 1.

5. 26B Wiped Out: The Korea Margin-Call Warning

Number 2 is, I agree with you wholeheartedly that we have some ways to go. The only question is, how do you navigate what's happening right now? I want to talk about Korea for a second.

Some of you may know, and maybe some of you don't, that there was $26 billion of margin loans taken out in the Korean stock market. When SKX and Samsung went down, 1.2 million accounts hit margin calls. One in 30 Korean adults hit margin calls. Sorry, 1.2 million accounts hit margin calls. 300,000 accounts were liquidated.

There was 2.3 trillion won—it's an insane, literally $1.5 billion to $2 billion of forced selling—and a lot of people ended up insolvent. I mean, the KOSPI fell 25%.

What does that tell you? It tells you that people sort of know, or they feel safe, in this trend. If people are willing to lever up, generally people lever up when they feel like they can really make it and they have strong—in aggregate, either delusional or strong—conviction that this trend is going to continue and that they can end up making a ton of money on it.

Obviously, they're gambling as well. Of course they're gambling, but in aggregate, they feel reasonably safe taking these bets. They're not as terrified as they should be. And that's what happens in a bubble, right?

The difference with this bubble is that there's actually an underlying reason for it, which is this massive productivity gain from AI. And I think that's still in its early stages.

That's going to lead to a lot of fake-outs, probably like the way that Bitcoin traded in 2017, where you get these monster rallies. Maybe you rally 2x and then you're off 40%; then you rally another 2x and you're off 40%. Basically, your job if you're a trader is to do one of 2 things.

You either need to sit and hold and not do anything until you start to see people missing earnings, at which point you probably want to step to the side. Hopefully, you've held long enough that you've made money even at that point. You're never going to cleanse and expunge your mind of your peak net worth. It's very unlikely that you're ever going to maintain that in a market like this. It's probably impossible because you're probably going to come off a decent amount.

Let's say earnings start to go wrong. Then you start to get out of these positions, and maybe you don't get back in until you see earnings do well again or you see that that's been baked into the price. Or you try to tactically trade it, which is almost always a bad idea, but every now and then can be a good one, right?

Like what happened here: We were sort of warning from the time that Intel crossed 120 and started hitting 125, 130. We were like, "Okay, this is getting a little nuts." When Micron went up 11% post-earnings in a day and then retraced the move, we were like, "Okay, that's a little—maybe you want to reduce positions." I talked about raising cash and sort of going to the next leg of the trade, getting away from memory and waiting for memory to reset.

6. The US-China Model Arms Race (And How To Trade It)

You can try to do that. I wouldn't advocate doing that with your entire stack; I'd obviously advocate doing that with a smaller position. But you can try to look for these types of things, right? You can trade around a position. Basically, we're good. I don't know, Jonah, did you pay attention to this Chinese-versus-American model fight?

Yeah, absolutely. I've been following it closely. To the best of my knowledge, it seems like a lot of Chinese model makers have caught up with what was likely Mistral AI. They're basically at the frontier or slightly behind it, which is of concern. The Chinese government has announced a lot of funding for their local, domestic AI.

They've re-shored their—I think, what was it? Z.ai was in Singapore. Then they re-shored it to the mainland because they want a stranglehold on the technology. But now there's also some cybersecurity issues. They're worried about Mistral; they're trying to produce their own—all this back-channel stuff. I don't think any of it is that relevant to us as investors until the apocalypse is nigh.

I have a weird view on this. I didn't have the same call as you on SanDisk and Micron. I basically said, "I think the memory and components-manufacturer bull market will continue for a long time," but I did caveat that by saying, "Expect insane, 1999-Nasdaq-style bull-market volatility."

Back to China, the fact that there's an arms race—nobody wins an arms race except the arms makers, right? To me, this is just something that, for us as retail investors, is a little hard to participate in. Micron stock is volatile, not yet priced to perfection. You can get in, but your return on variance is going to be difficult.

China competing with the United States to make smarter AI is just going to be bullish for components for a long time, but how do you express that trade? You can't really buy Anthropic shares unless you do it on the private market at an insane valuation. Same with OpenAI. The component makers are already crazy volatile, probably low Sharpe, but high return on capital if you can stick with it.

I don't know. I like your idea of side bets on industries that will benefit from AI and this arms race, but nation-states—there will be no winners between America and China on this one. It's just a component.

I think it's also important to look elsewhere. AI is obviously—and this is something that I'm going to try to do more on this pod. I'm going to do it right here in about a second—about things that other people are not necessarily looking at.

Everyone's talking about AI. Fewer people are talking about the fact that we just signed a deal with Saudi Arabia to help them build nuclear plants. That's pretty cool. This is just an extension of what's happening with uranium. As you guys know, I've been bullish on URA for a while, but I'm starting to try to find even more downstream things that could benefit.

For example, there are specific companies that benefit from actually running the reactors and enriching uranium. As that bet plays out, I'm kind of interested in those companies specifically. There's one called Centress, which kind of looks nice. It's come off a lot, but this is what you need to be doing. I don't have a position in this yet; I'm still doing some research there.

I want to get a better sense of what's happening. What are the specific things that the U.S. has agreed to with Saudi? Are there other deals that are currently being brokered? And will Centrus be involved in future construction? These are all the types of questions that you need to ask when you're researching a single-name stock.

This is the kind of stuff that I think there actually might be value in, because you talk to a lot of the PMs now at Millennium and Citadel, and everybody's watching AI stocks. The whole world is watching memory. The whole world is watching semiconductors.

I'm starting to think that there's probably less attention elsewhere, which, in a world where fundamentals matter, means that if you have these megatrends occurring, you need to start looking at these places. You need to start looking outside of where everybody else is looking. That's what I'm interested in right now: going over there and seeing if I can find anything useful in themes that aren't necessarily being covered.

7. Bombing Iran Again: Why Markets Don't Care

Yeah, maybe we should also talk about the fact that we're bombing Iran again. There was a great headline in The Wall Street Journal, Jonah—

That says, "Trump says U.S. will bomb Iran's power plants if Tehran strikes ships." It literally sounds like they're in kindergarten.

Yeah.

Dude, this is literally what I've been talking about with my wife. We have young kids, so we see them interact with each other. We see them having little kid battles, and honestly, when I read the news, adults are just children, right? We're just humans. We behave the same whether we're 3 years old or 60 years old in some respects.

Maybe there's a little more superego and polish on certain politicians. Not necessarily Trump. But yeah, this is literally the type of fight that my son and my daughter will have. My daughter will be like, "I want your toy." My son will be like, "You can't have it." Then she'll take it. Then he'll punch her in the face, right? Then she'll pull his hair, and then he'll pull her hair. That's kind of like the Iran war, right?

It seems like whoever's in charge of the cruise missiles and sea mines in Iran—the head of that department—he's the child who can't help himself. He just has to keep doing the thing that you're not supposed to do. So there's going to be more sea mines, more ships exploding, and then Trump is going to do what Trump does: retaliate, pull the hair, punch in the face.

I'm not being facetious, Avi. I'm literally describing what I expect to happen now. I thought this war would be off for a few months or over a year, maybe. It seems like it's right back on. I don't think it's going to be over until the United States does some serious damage to Iran. I think regime change is the only way this is going to end.

If you believe, as I do, that Iran was relatively close to having a weapon—and that's debatable—I think I've heard a lot of intelligent people argue that they were nowhere close and that it's all just a big hoax, a scam by Benjamin Netanyahu or something. But if you believe, as I do, that the middle of the bell curve is probably where we're at with this, and they were probably going to get a nuclear weapon in a threateningly short period of time, this is all sort of inevitable.

The fact that the war has begun only makes them want to accelerate their nuclear ambitions, if they hadn't already been at maximum speed and maximum preparation. My point here is that this war is not going to stop. It's going to be an ongoing thing.

I think the only positive takeaway is that a lot of pipelines are getting built around the Strait to circumvent it, right? A lot of east-west pipelines are getting built on the west side of the Gulf and on the east side of the Gulf. It's Iran, right? Who cares?

So what this is becoming is very clear: We need these east-west pipelines built. Who wins?

I mean, I'm sure there's a trade there, right? Who?

It's probably some local Saudi pipeline company that you can't invest in directly.

I don't know. It's a good question, though.

But this probably makes Saudi more important.

Way more important.

This is going to make Saudi Arabia extremely important. As they build this out, as we reduce dependency on the Strait of Hormuz—which is kind of the obvious outcome, right? That has to happen at this point—it's actually now security for everybody. It's security for China, it's security for Saudi, and it's security for the US. Nobody wants Iran to be able to fully control the trade of oil, and so the more that I think about it, the more that I realize that there are ways around everything. Always, nothing is set in stone. Iran used its leverage point, but now it's going to lose its leverage point forever over the next 5 years.

This strait is not going to matter in 10 years. Based on what Iran has done, now we're going to figure out how to get around it, because now it's imperative that we do. This is why maybe one of the reasons that oil isn't rallying ridiculously hard—or at least the long end isn't rallying very hard—is because people kind of know that this is now a short-term problem. Maybe part of it is Trump sort of elongating the war to allow the markets and to allow us to digest this.

What do you think?

Yeah, I think so too. I think he was giving markets a breather. He's very sensitive to markets; he does not want his name on a Great Depression. So, of course, he took his foot off the gas. We talked about this on the podcast: oil has a way of twisting everybody's arm. Of course, he took his foot off the gas when oil started to go into the danger zone and storage levels started to go below that sort of red line that we talked about.

Now, we've probably built some barrels back up and released a lot of Iranian oil, and a lot of it's really just a stock-and-flow problem. So now that the barrels have flowed a bit again, and he's sort of kicked the can down the road, and he's also sort of learned a little bit more about the military situation on the ground and in the Strait, he can go right back at it.

I still find it unbelievable that it's impossible for a modern navy of the United States' scale to secure that strait. It blows my mind. I do not understand how it is that, with all the assets we have in the region, however many millions of tons of, you know, whatever you call it, buoyant diplomacy are floating in that strait, they cannot secure it. I don't get it.

Yeah, I actually had a conversation with somebody about this—somebody in the military—and they reframed my thinking. We tend to believe, when you look at a map, that you can point at it and say, “Okay, well, if we control this area in the north, and then we control this area to the northeast, and then we just track it, we can figure out where to send our troops.”

The reality is, we do have extremely advanced technology. We're able to track a tremendous amount, ingest data, and send people to the right places. But the world is huge. Like, go out there and stand in a field one of these days and look as far as your eye can see. It's huge, right? Even New Jersey is big, and New Jersey is not that big. But compared to 1 human—even compared to 10,000—it's enormous.

The world is big. New Jersey is big, but it looks small on a map. Look at it on a map. It's big, man. You go to Israel—Israel is a tiny place on a map, but it's big. You can't walk it in a few hours. It's going to take days. You look at the Strait of Hormuz and you're like, “Look at this tiny little strip of water,” and you're like, “Dude, it's actually kind of big.” If you lined up ships back to back through the Strait of Hormuz, how many ships is it going to take to cover the whole thing? It's a fuckload, man.

You don't need to cover it with ships, obviously.

I know that radar and whatever sensors they use can track the little—

I understand that. All I'm saying is it's actually way more difficult than you think.

This blows my mind.

Way more difficult than you think. It literally is, because it's actually kind of tough to track all this. Not only that, it's hard to do that when there's still traffic going through the Strait of Hormuz. You have to have eyes on each vessel, because how do you differentiate an Iranian vessel versus some other vessel, especially when the Iranian vessels are hiding themselves, right? You don't want to cause an international incident. It's tough out there, man.

Do you know how long it took Ferdinand Magellan to circumnavigate the globe, Jonah?

People call me Magellan sometimes since I'm such a good navigator with Google Maps. Yeah, I know how to read Google Maps.

Who's bad with Google Maps?

No comment. Anyway, my point here, Avi, is that this is all going to get resolved. I do not think we're going to see a crazy spike in oil prices. I do not think this Iran war is going to derail the markets. It's very clear that whoever's imposing it—from day 1 on this podcast, we said that the person who created the problem has control of the problem—that is Donald Trump, right?

Right. And he's so markets-focused that whenever markets become a problem, he will, as a result of the problem he started in Iran, just exercise control over that problem, release some tension, let markets sell off, let stocks build, as we say in oil land, which means let inventories be replenished and tanks be refilled, and then he'll just go right back at it.

But once again, just the final point: if you believe, as I do, that Iran is close to having a nuclear weapon and that that cannot be allowed—which seems to be Trump's opinion, otherwise he wouldn't be bothering with this and risking his reputation on it—this war is not going to stop. This skirmish will continue until the hardliner who's the man behind the guy behind the guy is dead, and the guy behind him is dead, and so on and so forth, until there's regime change.

It's the only way. They will never give up their nuclear ambitions unless they pivot to either the pre-Ayatollah sort of monarchy situation with the Shah, or they just pivot to full democracy. That's a big ask, and it's going to take time.

They're never going to pivot. Did you see that apparently Israeli intelligence cultivated Ahmed (likely Ahmadinejad)?

Yeah, I thought that was awesome. Ahmed (likely Ahmadinejad) was the former president of Iran, the number 1 public enemy in the eyes of Israelis because he had some pretty fiery rhetoric. It's insane because, apparently, basically what happened—and this is a lesson to everybody—was that he wanted to run for president again, and he wasn't able to, and the Ayatollah sort of pushed him out. He became very bitter about this, and so he decided, “Well, the enemy of my enemy was the Ayatollah because the Ayatollah has made an enemy with him. Enemy of an enemy is my friend.”

So he asks to be set up with the Israelis. He gets set up with them, and the Israelis go, “This is brilliant. We can have an inside man.” I think The New York Times reported this. Good job, New York Times—finally did something right for a change. Although they reported it totally negatively, but whatever.

It's totally insane. They actually recruited this guy and they were going to try to install him, but then at some point, once the hostility started, he ended up getting cold feet. He didn't make it fast enough to some safe zone. Something ended up happening, and then the Iranians ended up capturing him and figuring out that this was all going on. So he's kind of out of the picture now.

But it also just goes to show that there are a lot of games being played right now. And I do think that there was—I mean, in hindsight, obviously, this is kind of obvious—a miscalculation on behalf of the US and Israel. I think that they thought they would be able to install a leader more quickly. Maybe it's possible that he was actually sort of the key component of the plan: if they had managed to install him, or if they knocked out the leadership, then he was actually in the line of succession and he would have been installed. Then they found out that he was communicating with the Israelis.

I think that's probably kind of what went wrong. They had a plan, and it sort of just fell apart, because I don't think—the way I look at it, the outcome of the war was not great so far. I actually don't think that the US would have gone in and started this war unless they had a plan to end the war reasonably quickly with a good outcome. So clearly, clearly, the plan went wrong.

One day, there's going to be a good book about what exactly went wrong and what exactly they were trying to do that didn't quite work out, and I'm excited to read it. Hopefully written by somebody good and not somebody [censored].

Yeah, I want to read that book, too.

Markets-wise, we're safe. Markets-wise, don't worry so much. Markets-wise, I'm looking at the markets and I'm thinking to myself, “Wow, today is a really nice day.” Not much is happening in the markets. You look at the Nasdaq, down 40 pips—nothing really happening. You look at Graham, down 1.5%; that's totally fine. You look at ZEC, down 4%; okay, something's happening. You look at Bitcoin, down 1%, kind of nothing happening. For the first time ever in weeks, we're kind of stabilizing.

And that's, I think, a very good sign for the markets. I was getting a little concerned at the high. I think we need to reset and regroup, and then the markets can keep going up.

8. Gold Looks Phenomenal & Crypto May Have Bottomed

The thing that actually looks the best to me right now, Jonah—you’re going to hate this—is gold. Gold actually looks phenomenal. I know you do.

Gold is off 26% from the highs, and you can look at gold miners too, because gold miners are going to be a good bet. Gold has basically gone sideways for 6 weeks, and I think right now, if the markets calm down, you probably have a rotation back. If memecoins go nowhere for a week, even 2 weeks, I think you can get a rotation back to gold, a rotation back to Bitcoin, and a rotation to these things that have been far off the highs for a long time, that do have long-term value propositions, that people are going to start reallocating to in their portfolios.

You guys really need to start showing charts too.

Yeah, I’m too technologically inept to do that.

You could share your screen and click on TradingView, and then just click around in it to show us what you’re thinking. That would be helpful.

But, yeah, I agree. I’m starting to look at crypto, and I think we may be getting out of the woods a little bit. It seems like the odds of the CLARITY Act passing are starting to tick back up. There’s some back-and-forth, but there seems to actually be a will in Washington to pass that, which I think would be bullish.

The rest of the market is kind of meh to me. I don’t see any screaming trades here, but crypto, aside from Saylor being Saylor, I think crypto may have bottomed out temporarily, which is a relief because it’s still a significant part of my portfolio that I care about.

As far as gold is concerned, I don’t understand what drives gold, so that’s why I always stay away from it. Technically, I was the head of a precious-metals desk for a while. I let the guys do their thing; I never really understood why they were doing what they were doing. I just feel kind of stupid when it comes to gold.

What gives you the impression that the number-one driver of gold, which is central banks, is going to start accumulating again? That’s literally all that matters.

That is quite literally all that matters. Number one, Japan is actually facing some inflationary pressures right now, and they might look to shore up their gold reserves. That could be good for it.

But, candidly, Jonah, the chart looks really nice. I’m actually just not going to over-intellectualize this. That’s a good-looking chart. Excuse my French. Basically, we’re straight back at that 4,000 level that we’ve defended for 6 weeks now. It’s kind of just looking good. Let’s put some moving averages on it.

Let’s see candles. Let’s put some simple moving averages on it. This is weekly. Okay, let’s do a 1-week. Let’s do—or, sorry, 7-week. Let’s do a 14. Let’s do a 52, because that’s a year. 7, 14. So that when I flip back to today, it’s good. I’m going to go to the daily.

Yeah. Maybe what you want to do is, if you’re feeling scared, wait for it to get above 4,300, which is the yearly moving average, and wait for that as your signal to get in. But that 4,000 level is looking quite strong to me.

Not only that, if you’re conservative, you can target the previous resistance level, which is around 4,800, and then stop out. That’s a great risk-reward right there. Look at that.

For those of you for whom this type of analysis just breaks your brain, it doubles because it’s gold. Obviously, I probably wouldn’t do this with stocks at all, ever, but with gold, it’s kind of the way that you do it. You kind of have to trade gold technically.

I would never pull up a memory chart. I don’t care about this chart. This chart kind of means nothing to me. I don’t think you can glean a lot of information from it, to be completely honest. I just don’t think that you’re going to glean a lot from it, because there’s so much that goes into this.

Avi, there are literally dozens or maybe even hundreds of teenagers on YouTube who stream technical-analysis crap. The reason why you’re right is that gold has no fundamentals; it’s just flows. So maybe technical analysis is the right way to slice the cake there.

For me, the problem is that 4,000 is a good level. It’s bounced off 4,000 a bunch of times, and we’re at 4,000 again, so let me buy some there. I guess if you have a tight stop and it goes a bit lower, then you sell and you’re safe.

It’s as simple as this: central banks that buy are made up of people from those countries. There are 190 countries in the world. Obviously, China and Japan—these people who are accumulating gold—they’re not that smart. They’re literally going to buy it.

That’s why I like technical analysis on gold. The gold market is actually driven by low-information people. It’s driven by people making decisions to shore up reserves or sell them, and that’s pretty low-information. Quite literally, it’s often determined based on price level. It’s not—

Gold is a reflexive asset. I’ll give you that.

Going up. Gold is reflexive. Exactly. The idea that people are going to buy gold at 4,000 and send it up is actually not stupid. Whereas if you tried to do technical analysis on NVIDIA, maybe go see a doctor or something, because you’re not going to get anywhere. I think for gold it’s actually quite useful. You’ve got to pick and choose.

My one caveat to that would be that gold is selling off. It’s currently in a downtrend; it hasn’t stabilized or anything. People who are reflexive buyers don’t want to buy when something is going down. All they care about is buying when it’s going up because they’re afraid it’ll go higher. They don’t care about catching—

That’s why that support level is so important. Basically, buy gold here with a tight stop. If your hypothesis, your thesis on the market, is 4,000—and that’s just that one number, not a 63-page fundamental thesis, just one word, 4,000—then if it breaks that number, your thesis has been disproven. The hypothesis is moot, so you have to sell.

Yeah, I guess you could buy with a tight stop. What I wouldn’t do is buy here because it looks like it’s stabilized at 4,000 a bunch of times and then just sit idly by while gold burns and crashes downwards. Like Bitcoin, gold is reflexive: sellers beget more selling, and buyers beget more buying. That’s sort of how it works.

As always, guys, none of this is financial advice. Good luck out there.

Shabbat shalom, mother.

Let’s go. Guy who’s clearly not Jewish. You’re clearly not Jewish.

It’s okay. Respect. How dare you appropriate my culture?

Thank you for being an ally and saying “Shabbat shalom” on a Wednesday.

Yeah, thank you. All right. Actually, today’s Tisha B’Av. I don’t know if you know that.

Tonight.

Tisha B’Av is where we commemorate the destruction of our 2 Temples: the first one by the Babylonians and the second one by the Romans. It’s very sad. We fast. I’m eating some food right now just to prepare for it.

Yeah, I’m actually pretty starving. What should I go get?

It’s New York City. Get the finest food in America. Get some sushi or something.

Yeah, I could go for some sushi, actually. Is there anything else that’s on your mind, Jonah? What’s on your mind? Maybe we should end the podcast with what Jonah is thinking about.

Honestly, the 1000x Pod is becoming my favorite podcast. I’m not featured on a lot of it anymore, so it’s not like I was there to see it happen. I’ve started tuning in more. Great job, Avi. I’m loving it. Loving the content.

Panhandler. What a great name.

Yeah.

Anyway, that's what's on my mind. I think you're doing a great job. I love the content, and I love how you're bringing on trading giants. I know we haven't published one of the episodes, but—

No, one of the episodes that's actually really cool is that I ended up talking to this guy. I'm going to let you guys know who it is because you're listening. I'm going to let you guys in on a little secret—a little secret here.

We interviewed the former CEO and founder of Signature Bank, which was, I think, the largest bank ever seized by the U.S. government. Holy shit, I tried to get him to name who seized the bank from him. He wouldn't do it, but he did tell me some other really interesting stories, including the fact that he worked with Lou Reeri (likely Lew Ranieri), who's featured in Liar's Poker, a great book by Michael Lewis. It's going to be a good episode.

More importantly, for all those people out there who are asking, "What's going on? Where are you guys going?" don't worry: we're not going to stop with the live streams. We're not going to stop. In fact, we're going to do even more live streams, but we're also going to pick up on the interviews, and that's going to be fun.

Well, those are good words. Maybe we should end it for today. It's been a good stream, Avi. Love seeing you, as always. It's hard to produce content in a meh market, but I feel like we pretty much covered the bases here. You're on, whatever. AI's probably still going, but shit could crash before it rips. So stay safe out there, guys.

Yeah, don't forget those famous words: shit can crash before it rips.

Yeah. Cool. All right. See you guys.