TXMC Trades Discussion on Macro, Fed, Inflation, and Bitcoin

looking at the intersection of politics, finance and technology. Now, you know, I try to bring to you some educations you can understand what's really going on, cut through the nonsense, through the noise and see the signals, see the real data, the latest breaking news, and I try to bring some new interesting guests. You don't have to hear me talk

all the time. And today I am joined in the studio by t x m C. You can find them on Twitter at t x m C Trades and we've done a couple Twitter spaces and stuff like that together, and uh man, I really enjoy your insights. So thanks so much for joining me today, Thanks for having me on Mark and looking forward to talking to you, buddy. Yeah, we've gotten into some good conversations on the Twitter spaces, but you know, with so many people on there, it's hard to like really dig in. But you know, I

do enjoy the analysis that you've been putting out there. Um. Kind of a lot of the same stuff that I cap you know, obviously bitcoin, but also greater, uh, the the why, as I like to call it, so the catalyst for it. Um, you know, the macro picture, if you will. So we'll talk about all those things. UM started off. I saw you tweeted out earlier today that everything on your chart was green. Bitcoin is green, the Dixie is green, gold is green, oils green, the bond

yields are green. What do you make of that. I've been thinking about that today. Um. You know, I went out to lunch with my family and trying to think about what I think is going on in the market. And I don't have, you know, great answers for all of it, but I think that we're kind of at an intersection here where the market is trying to figure out how seriously it takes the FED at trying to

basically engineer recession. And you know, there's a lot of leading economic indicators that are suggesting we're we're heading into one or that we're currently in one. But at the same time, people see commodities coming down, they suspect that inflation has peaked, and they are hoping that that means that some of the worst may be behind us. And I think that some of that push and pull is why on a day in the like today, that the

many things are up when you would expect. You know, if the dollar is really strong and oil is really strong, maybe we wouldn't see so much strength in tech stocks and elsewhere. But everything across the board is green. So I think there's a lot of uncertainty in the market. That's how I take it. Yeah, well, there's no doubt there's a lot of uncertainty in the market. I've never probably I don't think I've ever felt more uncertain about the markets at any point in my career. And I've

been through a couple of these bear markets. Um, you know, one thing, when you look at the blow off top. So if you look at you know, market cycles, any if you pick anyone, go back to the dot com boom or seventeen bitcoin boom. You see that you go into these parabolic runs and it starts sucking in, sucking and sucking more and more buyers and goes into this parabolic advance and then it gets very volatile at the top and then it blows off. But it doesn't doesn't

always just blow up in a straight line. You know that it has the bounces and it gets supervoltal and and maybe that's just kind of where we're at. UM. I was talking with Macro al alf alf Macro yesterday, and he really focuses a lot on on the bond side of things, and he was just saying kind of the same thing that you're saying, which is the bond markets are saying they don't believe the Fed, they don't believe the central banks are going to go through with this.

That's what the bonds are pricing in. And so it kind of goes along with what you're saying. But it is interesting to see, um, the dollar, the Dollar index as you have on your charter, the d X Y, which is the dollar compared to a basket of currency,

is really just kind of the euro mostly. UM. How the dollar has been getting so strong lately, and it looks like I was looking at some charts yesterday, it was like almost like a direct correlation inverse correlation with the strength of the dollar and commodities taking a dip at the same time, UM, which is interesting. So I started trying to look at the commodities priced and other currencies to see is it really just the dollar getting

stronger or the commodities getting weaker. But then in this chart that you put to today, we see the DIXIE is strong and we see the commodities and other assets being strong at the same time. So I thought that was pretty interesting. Yeah, I think part of what's happening with the DIXIE is is the weakening of the euro and the yen like, which is kind of what you're describing with mostly being the euro. Uh. And so I think that and I'm certainly not an f X expert.

I'm still very much trying to learn and get an idea for intuitively interpreting these these markets. But you know, the basket, the makeup of the d X Y is important to which direction it's going in, and it's not always necessarily dollar strength it's leading, but perhaps weakness and the other members. And I think that's part of what it is here, you know. And commodities, Yeah, they they

they've been coming down. They've bounced a little today, But I think there's very real concerns about recession, even more so in Europe than here in the US, and I think that's playing a role in the Dixie's strength. Yeah,

for sure. Well, and we have a situation where, you know, in the United States, we've been raising rates to talking about tightening, not really tightening yet, but talking about tightening, when the rest of the world, and back to Europe, you know, they've been in a situation where they've been trying to ease. Then they said, okay, well we'll try to tighten. But as soon as they try to tighten, things have just gone off the rails and they're quickly

frantically going backwards on that. Christine Leguard talked about something called fragmentation, which is basically just a fancy word of saying more distribute, redistribution. Right, well, let's just let's just take it from the good countries and we'll give it to the bad countries. And uh, it doesn't sound like a good plan of you have you looked into that. I've been trying to read a little about it. I don't I'm not satisfied with my opinion on it right now.

But yeah, they've got a big mess on their hands. Yeah, they got a big mess, and it doesn't look like it's going to make it make it. That doesnt seem like they're gonna have a good way getting out of this now. I want to talk about, you know, we'll talk about this bigger macro picture worth, which I think is important to understand because it's, you know, the big catalyst. It's the fundamental drivers of of of most assets, all

assets pretty much today. And then we'll bring it back into bitcoin and we'll talk about that specifically, but if we just kind of stick on this macro trend um, you know, one of the big fears I think that the FED has too and we're starting to see it is in the credit markets, and so I think what the FED wants to do, the central banks want to do, is make sure there's enough liquidity to keep the system going.

And I know you had posted a chart also on the corporate credit spreads, so you want to look at the bond market. The bond market typically kind of tells you where the equity markets. The debt markets tell you where the stock markets are going to go um, And we're starting to see these corporate credit spreads really starting to get wide, and it looks like the credit markets

are getting pretty dangerous. To what's your take on that? Yeah, I you know, I've been meaning to dig in and and look at the different layers inside of the credit spread because you know why, I posted an index that puts up to them together. Uh, and yeah, it's they've been going down for a while. And even if you look at emerging markets E T F, or you look at H Y G or J and K or any

of those, Uh, it's it's it's been down only. And I think that that's that's a really risky place, and that was in part what blew out in ten and kind of forced the pal pivot. But also, I mean, there's so many companies we've got that have propped up on debt over the last couple of years, so many zombified companies. And uh, you know, with the seeming lead, seeming lack of demand for corporate debt, I you know, you you greatly accelerate the likelihood of defaults in that market.

You know, when as people are as buyers are leaving. Uh and with rates rising where they are, some of these people are gonna get downgraded. It's gonna be harder for them to get financing. I think that that that market is right for some serious deterioration. And we're getting close, like you said that chart I posted this morning, Uh, we're past the level we were aten that caused PAL to pivot at that point in time, But it's unclear if that is going to be enough this time around.

It seems like their focuses elsewhere, probably mostly because of inflation. Yeah, and I think I think that, I mean, you just nailed it with that point. Um. They've come out and said as much. Right, So in the last meeting they had, Powell said we are committed to getting back to two percent inflation. And so you know, they vowed, they promised, they're committed, you know, all these big fancy words. But

I think they're pretty much focused on that number. So in the past you kind of point back, we're getting back to the levels where they had to come off of that. So for the listeners, UM J. Powell came in, took over the FED and was fired up to to change the system, and he wanted to get back to normal, and he wanted to raise rates back up again and all these things. You wanted to decrease the balance sheet,

all these things. You want to fix the system. And very quickly the markets didn't like that and they started rolling over very fast, and to the point t XMC is making, Uh, they were forced to pivot off of that because the markets were breaking apart. But today the markets are breaking apart worse than we saw that dip. But at the same time, they're not ready to pivot, and I think it's because they're focused on a completely different metric, which which I want to dig into with

you even more. Um, you're listening to the Market Mos Show. We're talking about the Decentralized Revolution, talking about bick going cryptocurrencies. We're talking about the markets, the reason why we need bitcoin and what drives that. I'm in the studio with t x m C. You can find them on Twitter at t x mc Trades. We're gonna be talking about that. I want to talk about again, Like I said, the markets, I want to dig into some unemployment and some other metrics.

Look at what the FEDS focusing on. We're gonna bring it back to bitcoin and what we think is going to happen with bitcoin in the near future. I got a whole lot more planned in a minute when I come back, So don't go away, We'll be right back, all right, Welcome back. You are listening to the Markma Show. We're talking about the Decentralized Revolution. We're talking about bitcoin. We're talking about cryptocurrencies. We talk about the what we talked about, the why, why is it important? Why will

the price go up or down? What should we expect, and so much more. I'm in the studio with t x m C. You can find them on Twitter t x MC trades. And before the break we were talking, you had basically had brought up the Powell pivot, the Fed pivot in eighteen and UM, how they're looking at different data. So last time they move of don the markets and a lot of people. This time we're thinking that, you know, maybe they'll let the markets drop before they pivot.

And now here we are much further depend on which end actually're looking at. UM and yet they don't seem to be ready to pivot UM. And in my opinion, I basically have listened to what they said, and they said they're focused on getting inflation back under control. I spoke at a conference two weeks ago, about a week and a half ago UM and Joseph Waange was there. He's a former Fed insider and a Fed Fed bond trader, and he said the same thing. He said, they're a

committed to that. He said they need to see a meaningful movement off of that, so we're at eight point six. They need to see a seven six and a five six before they'll do anything. Um. But a lot of people also think they'll wait until something breaks. What what do you? What do you think about that? Right? That's that's the million dollar question, is what question? Yeah? What's the thing that's going to break? Um? And I think there's a there's a lot of different forces that are

working here. Right. You named inflation. That's their clear stated, um number one priority. It's the number one priority of voters in a mid term election year. Angry voters. Uh. And inflation affects everyone. It affects more people than falling asset prices do. Right, Like the stock market affects a certain percentage of Americans who have a lot of their

wealth there. But there's half of America or more that don't have any stock exposure to speak of for anything meaningful, and so they don't really care so much about what the SNP is doing. They care about the prices of gas, the price of shelter, the price of meat and eggs. I think what we are likely headed for it's hard

to know what the thing is that will break. Maybe it's the credit markets, like you and I were just talking about we thought it was going to be the bond market, but it seems like they've done most of their sell off, at least to this point, and maybe they're waiting for some new narrative that drives yields higher. I couldn't fathom yields breaking out of a four to your trend with record debt, but regardless, it seems bonds

have cooled off a little bit. So with all of this talk about unemployment being low, the labor market is strong, that's what they keep saying. I really feel that they're just going to continue tightening until we have some kind of a blowout in the labor markets and then they're forced to seriously consider helping people through stimulus or reinvigorating the economy, even though inflation is really high. And I think this controlled demolition, which is a term I've heard

a lot of people use. Danielle d Martino Booth has talked about this a lot. I feel like over the last few months, we haven't seen that that sharp, volatile fall from a bubble pop like you were describing, and it's been more of like this controlled demolition, Like you said,

the FED hasn't tightened that much. They've talked a lot about tightening, and the market has done of the work for them, and the bond market even got out ahead of the Fed a bit, which is why I think partially it's coming back some, but it I really believe they're going to continue to tighten, and because of some demographic issues, there's only I think, so much labor that can really come back, and so they're they're hoping this to see job openings fall or at least that disparity

between the people who want to work and the amount of available work closed down, because that's what they're calling demand. And I really think that that as long as inflation remains elevated and it continues encouraging them to stay on this path, that that they're just gonna push until something like that breaks. And if we're about to have a Q two earning season, that is, it's anyone's guess how

good or bad it is. And if we see some surprises to the downside, if there's serious pain inflicted on consumer spending on the nominal level, because I think most people are looking at nominal numbers going up because prices are going up, and they're ignoring the weakness in real numbers. But if we see actual falls and consumer spending, uh, that might start to wake up the FED. Because the

the economy is powered by the consumer. It's powered by their spending, and that is what powers tax receipts, which currently are not enough to pay the government's obligations. They have to get money from somewhere. So there's a there's a certain point where falling GDP is antithetical to the FED maintaining good standing on the debt. Yeah. Yeah, I mean there's so many levers. It's it's it's such an intricate web to sit there to try to unweave if

you would, you know. And it's like the one thing we can see is that if they're committed to bring in inflation down and they're talking about price inflation, so the price of consumer goods and so when you talk about gas, gas prices are a big thing. We see the President tweeting about that all the time. Doesn't know what he's talking about, but he's still tweeting about it. We know it's a hot point, right, So gas prices,

food prices. I commented on a tweet from Lynn Alden earlier today talking about how UM food prices have gone up by twelve percent in the same time that, um, what is it? She said, the price of food used at home rose twelve percent last year while average wages rose six percent, and so like that's a big problem for people to have. And I had said, basically, humans can take a lot of pain and struggle brought on

by central planners as we peak approach peak centralization. But the catalyst that always swings the pendulum back is always food. Because if you if you can't eat or feed your family, it's time for change. And so we have food and energy, right, those are kind of the two main things that you need to live, um. And so people are screaming about that. And so the FED can't print more food or energy, right,

they can't do that. And there was a testimony I talked about I think a week or two ago, and it was a Senator John Kennedy and he was questioning J. Powell and he said, so, you know there's two levers, right, supply and demand, and the FED can't increase supply, So you're focused on destroying demand, is that right? And J. Pale is like, yeah, right, we're focused on destroying demand.

They talked about we need to bring stocks down to lower a man, so the wealth effect, right, So if they make people feel poor, their retirements come down, their house come down, etcetera. They just spend less. And so I think I think the point that you're making, at least I think is that I'm agreeing with, is that looking at the consumer spending is probably a better indicator than the CPI because the CBI is more of like a lagging indicator. And if they're starting to spend less

than we know, the prices might be coming down. Is that kind of what you're seeing. It is, Yeah, it is. They're spending and their wages are the things that I watch a lot, and you know, real wages are quite negative. Uh, and real consumer spending is not strong despite nominal values being elevated because prices have gone up. You know, there's certain things people just have to buy. You know, it

doesn't really matter how expensive it is. They can only you know, choose the cheapest item on the shelf so many times for that basket of eggs that they must have, right, yeah, yeah, man, and so and then so this is the problem in the US. But as we talked about, there's a problem globally and uh, the whole the whole financial system is

changing right before our very eyes, which is pretty interesting. Um, we can see emerging markets are dropping like flies and now there's protests all over the world with uh, we see you know, currency is going down. Now we see countries going basically to a standstill, stopping and basically a new payment system that the bricks nations are setting up in real time. So we have all these catalysts, which really signifies the world is kind of changing as we

know it. But what does that mean for bitcoin? And that's some questions I want to get into you when we get back here in a second. I'm in the studio UM with t x MC. You can find them on Twitter at t x mc Trades. We're talking about the bigger macro economic picture of what's going on with debt, cp I, what the Fed is gonna do when they're gonna do it, and then ultimately I want to bring

this back to what does it mean for bitcoin. Bitcoin has been only been around for what we've been in the longest bowl run in history, and if we go into a secular bear market, what does that mean? It's pretty interesting, So I want to talk about that and more with t x MC trades. Um, you're listening to the Mark mos Show. I'm gonna be back with that and more in a minute, So don't go away, we'll be back, all right, Welcome back. You are listening to

the Mark Moa Show. We're talking about the decentralized revolution that the world is going through changing right before our very eyes, led by the catalyst of decentralized technology, which is bitcoin, cryptocurrencies and more. Now I'm in the studio with t x m C t m x MC trades on Twitter, and we're talking about some of these catalysts happening in the United States, uh, and the global financial

system for that matter. So you know, I know you've done a lot of on chain metrics looking at bitcoin, you know, looking at it from a bunch of different angles, and it seems like we've seen a lot. We've seen we've seen a lot of massive movements inside the bitcoin space. Specifically. One of the things that it seems like to me, and I'd love to get your take on this, is that it looks like bitcoin has been this kind of canary in the coal mine, if you will. So the

FEDS started saying they were gonna start raising rates. In November of last year, Bitcoin starts selling off pretty quickly much pretty far ahead of of the stock market. UM, and now it seems to have kind of found this bottom. I think it's interesting when markets stopped going down on bad news. So like we saw the terror Luna liquidation,

which was very bad news, and it crashed. And then we saw, you know, the dominoes continue to fall, more contagion and you know, the Celsius and the ft X, and it's just continue to get on and on and on. But now we're still seeing more bad news. We started seeing massive bitcoin mining liquidations happening, but yet the markets aren't moving down anymore. So what's your take on that? Do you think the markets have taken the bad news. We've absorbed it, and now these even more liquidation of

miners aren't bringing the markets down. So you know, definitely those first moves down, UM, the energy behind them, there was a clear reason to push the market down right there. It was counterparty risk, unsecured debt, UH and liquidations. I we've seen most of that now, UM, and you know, it's we're kind of in a weird place here because appetite for risk is essentially non existent. Obviously, there are people who always want to buy bitcoin when it's on

a discount. I don't really mean those people, but just general market appetite for risk is way down, and I think that people are still kind of waiting to see what happens. Market participants broadly don't know what's going to happen. You know, we've got cp I next week. Q two earnings are about to come in. We're about to find out if we're actually in a technical recession or not in a couple of weeks from now. So there's a

lot of things the market's waiting for. And uh, I think that it it's per it's certainly possible that bitcoin might have reached a bottom. You know, we came all the way down. We broke the all time high seventeen all time high, which we hadn't done before in a in a bull market pullback. So that really kind of shook a lot of people's narratives and some of the dogmatic beliefs about what bitcoin cannor can't do. And I think some of that is healthy long term for bitcoin,

for any asset, kind of shake loose. Some I don't know, irrational beliefs like that so I think we've gone through most of that kind of pain. Obviously, something else could happen that pushes us down further. But I think that if you look, if you look at some of the other bear markets, just for Bitcoin alone, granted they came in that secular bowl that you were talking about, Mark, but you know their bitcoin goes to these long periods of reset. You know, it can be months. Sometimes there's

been times where it's been years before it gathers momentum. Again, I don't necessarily think this will be years, but I do think that you're absolutely right. I like what you said about it being a fire alarm. Uh. You know, my my buddy Checkmate, who's the lead analyst at glass Node, he was one of the first people I heard say that a long time ago, that it's like the last functioning fire alarm. I think because it's a it's probably

possibly the last great free market. Because it's a highly liquid instrument that runs three and it's borderless, it allows itself to react to changing economic conditions more quickly and more violently than most other assets and markets, and I think that's why it functions so well. Now, I I would agree with the one of the most free markets that we have. Doesn't mean it's not manipulated. It's it's it's heavily manipulated by these big movements because it's such

a small market cap. But you know, so back to kind of this just this cascading event that we're talking about, right, So the Terra Luna blow up, they had to dump all their bitcoin they had in reserves, and then the next Domino, and then you've got the Celsius liquidations and three Arrows capital and you know all the liquidations don't need to go through all those But um, you know supply and demand, right, so, um, we can make things super complicated, but we can also make them very simple.

And like markets or prices are set by supply and demand imbalances in the market, and so there was more people selling than there were people buying, so it pushed the price down. But now, um, to these giant liquidations that we saw, uh, and we saw some big ones, right, was eighteen thousand bitcoin were dumped unto the market something like that. Um, big big numbers, but the market's gobbled those up pretty fast. So you would have like to to the point you were making there earlier that a

lot of that risk appetite has gone, which I would agree. Um, it's been trading closely. Like with the NASDAC tech stocks, they're out of favor right now. Um. But now bitcoin is at a four billion market cap. It's it's very tiny, and you have these like true believers that believe in it for the long term, and so they it's not a risk appetite for them. It's like, hey, I I believe this. I'm I can wait five years, I can

wait ten years. And we know that historically under twenty thousand is like a historic buying a cheap, cheap moment, and so we saw it sell down, sell down, cell down, cell down. But now eighteen thousand bitcoin dumped in the market and they got gobbled up. I mean that seemed pretty strong to me. Yeah, I mean it can definitely absorb some cell pressure, right. And and it depends on

how those coins are dumped. You know, if if they're sold slowly over a period of time, if the bots kind of distribute them the right way, similarly to the way that Michael Sailor buys bitcoin. Uh, then it can possibly just be absorbed by regular market liquidity. Uh. It's it's definitely possible but I think, you know, that kind of fervor where people just want to own bitcoin and they're willing to market by to get that bitcoin wherever

it is. Uh, that kind of appetite. I think we might be some time away for or we were waiting for some kind of an economic catalyst, whether it's they turned QUEUEI back on and everyone thinks that solves the problem, whatever it is. I think a lot of people are waiting for that. UM. That's where I think we will see a sustained up trend. And I think maybe until that, until we could agree that risk appetite broadly is more um more palpable. I think that we're in for more volatility.

We might get a bear market rally and then it might come back down, you know. Sure. Yeah, And back to kind of what I was saying earlier, like at the top of these these peak market cycles, we just get lots of volatility, but just for some numbers. I was just looking here. So in the last two weeks of June, bitcoin miners dumped eighteen thousand, two hundred fifty one bitcoin worth three hundred and seventy two million dollars UM. It's a lot, and the market absorbed that without dropping more.

It did. I think it dropped it down to about high nineteens and then it popped back up just above twenty. So um, like right when it was sitting on that you know, historical kind of point of that, you know, two hundred moving day average, so to speak. Um, then those eighteen thousand bitcoin got dumped in the market and it dropped it a little bit lower, but now it seemed to absorb it and come back up, and uh, maybe we don't have any more of these big liquidations there.

I mean, I think one thing I was looking at was, um, you know, potentially the Celsius position getting liquidated. But they've been able to continue to bring that level down and now they're and I was afraid that, you know, these these Wall Street raiders, we're going out and really targeting these funds and these pegs to try to crash them so they can make some extra money, which I believe

they were. And so seeing that like Celsius peg sitting at eighteen thousand, well they're going to hunt that, right, Well, fifteen thousand, maybe they hunt that. Now it's down to I believe about four or five thousand. I don't see them trying to even bother with that, right, So, I don't know if there's any more of these big I mean these bitcoin miners, and they've dumped the majority of what they were sitting on now, Um they still have some of these big miners have a thousand bitcoin they

could dump, but that's not eighteen thousands. So yeah, we don't know. Obviously, anything can happen. Um, things can continue to get way worse. We could see the European market blow up, and your Japan could blow up, drag Europe with it, drag the US into it. Um, you know, we don't know, but it seems like maybe we've seen the worst of it. And that's kind of what I'm thinking. I think it's possible. Yeah, I want to Uh, I want to get into what comes next, Like where do

we go from here? Are we on a four year cycle? Do you think those cycles are dead? Like Michael Saylor said, Um, do you when do you think? I was on Fox News with Charles Paine just before we started and he said, when will bitcoin get back on track? I'll ask you that same question. Um, So I'm gonna be back with that and more. You're listening to the Mark Ma Show. We're talking about of course, the decentralized Revolution, talking about bitcoin, cryptocurrencies,

the greater macro markets. I'm in the studio with t x m C. You can find them on Twitter at t x mc Trades, and we're talking about what we've been talking about, what has been dragging bitcoin down? Have we found the bottom? And now we'll get into what comes next and what kind of time frames and of course none of us know, but we're gonna guess about it. So I'll be back with that in more in a minute. Don't go away, I'll be right back. All right, Welcome back.

You're listening to the Mark mo Show. We're talking about the Decentralized Revolution, talking about bitcoin, talking about cryptocurrencies, talking about the greater macro markets. If you're just tuning in, you when you've missed a whole bunch, I'm not gonna try to catch you back up. But good news for you. You You can catch this on demand on the podcast. You can just search Mark Moss Podcast or Mark mos Show. Find out on any of your podcast apps, the I

Heart Music app, of course, iTunes app, etcetera. Now I'm in the studio with t x MC. You can find them on Twitter at t x MC trades. Now, Um, before we went on the break, I said, let's now shift to we've kind of set up what's going on in the world all these things. Of course we have no idea. All we're trying to do is speculate. Now, markets are a discounting mechanism. So basically that's what markets do.

They try to guess if a if a price is going to be higher in the future or lower, right, and so then we're just here trying to play along. So we kind of set the problem up pretty well. I think we've kind of both agreed that we've seen this massive liquidations that's brought it down. Maybe there's not a bunch of more liquidations in front of it. Of course, if we if we used very simple terminology, markets stopped going down when there's no more sellers, and so have

we washed out the majority of the sellers. You you talked about getting back below the two thousand seventeen peak. That was good. We talked about getting rid of all the level ridge. I think that was good. We talked about the bitcoin miners getting rid of all their books. I think that was a lot of liquidity. So how many how many sellers are left. We don't know, but they may or may not keep going down. We don't know, Um what what what happens or what makes them go

back up? Now we know historically we've kind of moved on this four year having cycle. Um, could it be possible that it takes three or four years to get back to an all time high? Um? Do you think it happens sooner? What's your kind of thinking process as to where we go from here? Yeah, that's a really good question. That's something I spend a lot of time thinking about. UM. And you know, obviously, like you eloquently said,

we don't exactly know what's going to happen. We don't know exactly the timeline, but there are some things we do know. One of those things is, like you mentioned a few minutes ago in the earlier segment, that bitcoin has existed through a secular bowl. And in that secular bowl, inflation has always been about two percent or better or less. And we're now in a in a regime where I think it's reasonable to believe that inflation will not be at two percent anytime soon. It's probably going to stay

elevated somewhere who knows where? Five six percent, four percent. Any of those values are very hard societally to stomach for a sustained period of time. And I and and I'll bring everyone's detention to the fact that if we get it down from eight point six to five or four or three or even two, it doesn't really help you. So to the point I made earlier talking about len Alden's message of food prices went up twelve percent, bye bye bye. When pay went up six percent, so food

prices went up, gas prices went up, you can't afford them. Now, if inflation goes down to six or five or four or even back to two, that doesn't mean the prices actually came back down. That just means they keep continue going up, but only slower. So exactly, it's a gread of change. So even if even if inflation is like you said, at four percent, still going up four percent a year from where it was already elevated right from we already had forty year highs and inflation so and

wages are just getting further and further behind that. So I think that we are in an environment where it's the past four year cycle pattern for bitcoin I think is under threat of being violated simply because the economic landscape behind it has changed. And so you know, what if the FED pivots to Quie. Who knows what that

looks like. But what if they turned the liquidity spigot back on, they start reigning helicopter money, and we still have five percent inflation, We still have elevated costs, the priority of expenditures for the average household, you know, the things that they have to pay for. All of those things are now more expensive than when they were the last time people wanted to buy bitcoin, regular retail people. So I think that that that is a climate no

one alive has ever seen before. It's certainly not in the Qui era, where the FED reverses back to easing while inflation is still extremely elevated. So I think that that will play a factor in how quickly risk appetite returns to the kind of upward sustained bull run that you know bitcoiners are used to when things are going well. So who knows how long exactly that takes. I believe that regardless of what happens with Quie, I don't think that they can carry this on until next year, like

deep into next year. I feel like sometime in the next calendar year, they're gonna hit the cold wall of math and they're going to have to rethink their plans simply because of the cost of debt, but the generally speaking,

if they pay it back. So you're saying you think they'll have to come off of this stance and come off this pivot in the next twelve months, Well, I think so, I mean, and that's a year, meaning by December calendar year, between now and next summer, which is when the soonest rate hikes are priced in by the market, and they've been getting soon closer and closer to the present. They've been getting pulled into the present. So I actually

think it's probably not that long. I'm being conservative. But the cost of debt is continuing to rise, while GDP is weakening, and tax receeats are are going to be threatened by lower spending. There's there's a there's a point where they have to have some money to pay their their bills. Are they default and they have to get that money from somewhere, and so that meets printing. Yeah, it scares me because the Fed doesn't know what they're doing.

And Jerome pal just recently told us that we already knew that, but if he came out and actually said that, and I think if I can't quote him exactly, but he said, we've just figured out how little we actually know about inflation, or something to that effect. I'm sure you heard that, yes, something to that effect. Um I heard, I I talked. It was a month or two ago.

There was a meeting with j Pal Christine Leguard from the E c B and Christina Lena Georgina from the I m F. And christ Lena said, um, they're they're all laughing, and she said, um, I guess we just didn't think about the unintended consequences of printing all of this money. Heard that we didn't think about that, right, And then she said, I guess we're sort of like a bunch of eight year olds playing soccer where we don't cover the field. We just all follow the ball.

So she said, we're like a bunch of eight year olds Jeron Palsa don't anything about it. So what scares me is that, Um, they don't operate with the precision of a surgeon with a scalpel, but rather a blunt instrument. You know, they're operating with a chainsaw. And so it's like they it was like, we can't get the inflation. We can't get the inflation. We can't get the inflation. We can't get the inflation. They said, we're gonna let

it run hot. So they were saying, now maybe we'll get to four or five percent, but we'll average that with being below and so somehow we'll average into a two or three percent number. So they were kind of okay to let it get to four. Or they got to nine, so now you know, eight point six rounded up to nine. Now they're saying, we're committed to get to two and they're gonna crush all this demand. But do you think they're gonna hit two perfectly or are

they going to overshoot that goal as well? And I'm afraid they're gonna overshoot that goal as well. And they get they get really dug into these positions where we're not even thinking about thinking about raising rates, and they let it go on way too long. Everybody knows this. I mean you and I we're just guys on you know, YouTube in the radio, Like we're not PhDs with a you know, a thousand PhDs working for us at the FED.

And like we knew they were but they were dug in on that position, they wouldn't come off of it. And now maybe they're too dug in, and I'm afraid of that. So we don't know how far they'll go before they let it, before they'll come off that pivot. But I think everybody agrees at some point it's coming, and I just win. Yeah, they definitely are dug in, and you know, they love to use that forward guidance.

Like we said earlier, they've done ninety percent of the work just from talking about tightening, and the market has responded. And I think because Powell is so committed to telling the market what he wants to do ahead of time that he's afraid to ever surprise it for any reason. Even when the data starkly changes against his plans, he still wants to tease out a multi month you know,

general turning of the barge. And I think that that is in a large part why we're in this mess now, is his reticence to make quicker changes to his plan, so real quick thirty seconds. If they don't pivot, Uh, if if they stay stuck on this for the next year, kind of to your best case, Uh, do you think bitcoin just continues to kind of grind up and down, chop, chop people up and stick kind of in this range. Yeah, I think it chops around. Maybe it goes a little

bit higher at certain points. I think there's there's you could make an argument that there's times where maybe we get a little bear market rally we've been overdue for one. But I don't think that it breaks into any kind of price discovery at all until we're well beyond this current situation that we're in, and that might be um into next year, depending on what a pivot looks like whenever that comes, depending on how aggressive that is. Yeah,

and that's anybody's guests. But what we can what we can, what we do know is that we can see booms and bus continue to get bigger and bigger and bigger, and so uh eight it was a seven billion dollar hole they had to fill, end up being about one point five trillion. In twenty it was seven five five six trillion, and the next one's probably gonna be fifteen trillion. Anyway, you're listening to the Mark Moss Show. Thanks so much for listening. UM, see you next time.