In this week’s edition of Wealthion’s Weekly Market Recap, Andrew Brill highlights key insights from our expert guests:
– Peter Schiff explores the risks of Bitcoin and predicts a return to quantitative easing by the Fed. – Ed Yardeni discusses Trump’s economic policies, the Fed’s rate strategy, and the implications of global energy trends. – Lobo Tiggre shares his bullish outlook on uranium, the labor market, and gold’s continued momentum. – Jordi Visser dives into AI, Bitcoin’s network effect, and the transition from globalization to decentralization.
Stay informed about the latest market trends, expert analyses, and how they might impact your financial future.
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Andrew Brill 0:03
Bitcoin raised the bar, breaking through 100,000 for the first time, then retreat slightly wealthy on is here to give you insights that’ll help you navigate your financial future. I’m your host. Andrew brill, welcome to wealthions, weekly market recap. Let’s see what our experts had to say this week. You
Andrew Brill 0:23
this week on speak up. Peter Schiff joined Anthony Scaramucci. Given the state of the economy the incoming administration and uncertainty, Peter contemplated what the Fed will do in 2025 he’s also a Bitcoin detractor and explain what he sees as the risk concerns for Bitcoin.
Anthony Scaramucci 0:44
Let’s talk specifically. What. What do you think the Federal Reserve does in the year 2025
Peter Schiff 0:50
Well, you know, I’ve been arguing for quite some time now that the economic data did not tell the true story. And in fact, that’s why I believe Trump was elected. I mean, if the economy was as great as Powell claims it is, you know, as the media claimed it was, as Biden claimed it was, Harry Harris would be the next president, all the exit polls showed that it was a pocketbook election that people were voting for change because the economy and inflation were the Number One issues, and the economy and inflation are only the number one issues when they’re bad, if they’re good, nobody cares about it, and they vote for other things. So I think we’re going to continue to get weaker economic data, like all the data we got today was extremely weak, from the ADP numbers to the ISM numbers, factory orders. I mean, I think we’re going to keep getting more downward revisions to a lot of the numbers. We’ve gotten multiple downward revisions now to the Non Farm Payroll numbers over the past year, year, year and a half. I think it’s very possible that we’ve been in a recession for most of 2024 and I think that will continue into 2025 and so as the data gets stronger to support that, you know the Fed is going to try to continue with its rate cuts, but I am expecting a return to quantitative easing. Now, I was on a panel down in New Orleans, like a couple weeks ago, and on that panel, Danielle demarcuna Booth was there, and she I mentioned that I thought we were going to have a return to QE and what she told me is, no, they can’t do that unless they go to zero first, that somehow they can’t launch quantitative easing unless they have a zero bound. Now, I had never heard of that before, but it’s my bet that if that’s what the rule is, they’re going to violate that. I because I don’t think they’re going to be able to be able to get back down to zero, but I do think they’re going to restart the QE engine, because I think that they’ve already lost control of the long end of the bond market. Is one of the forecasts that I made that I got right recently. I was saying that when the Fed cuts rates, that was going to be the bottom of the long term rates, and that they would go up, and that’s exactly what they’ve done. Ever since the Fed cut rates, long term rates have gone the other way, and I think that’s going to continue, and that’s going to be very problematic for the Fed, because it’s going to be harmful to the economy, to the housing market, and when we’re in a recession, or when the recession gets worse, I think the Fed is going to be pressured to try to lower long term rates, and the only way it would be able to do that is by buying the long term bonds. And the only way to get the money to do that is to print it. So I think we’re going to have a resurgence of inflation. We’re going to have a weaker economy, stagflation. That’s the one thing that, of course, the Fed has no plan for I thought it was almost humorous, and even it got a laugh out of Powell. Reporter asked him at the last press conference, what’s your plan for stagflation? And he laughed and said, our plan for Stagflation is the is that we’re not going to have it, and so they’re just hoping that there is no stagflation, but that unfortunately, where we’re going here
Anthony Scaramucci 4:01
on wealthion, give us an update on where you are. I saw you at actually one point, express some regret. Typical trader in you, you were like, you know, hey, I regret not buying some right, because it went up. But I’m really want to talk about the fundamentals and the risks associated with cryptocurrency from your opinion. Give us that update from your mouth to our network listeners,
Peter Schiff 4:26
yeah, I get a kick out of, like, some of the crypto people trying to make something out of the fact that I say, Oh, I regret not buying Bitcoin, as if I’ve changed my opinion. I mean, obviously, when I first learned about it, and I don’t remember exactly what the price was. I forget if it was above or below $1 I mean, I really can’t say, but it was around $1 when I learned about it. And I had money. Wasn’t like I was poor back then. I had money. So I could have, I could have put 10 grand, 100 grand, you know, I could have put something into it, and I’d be a multi billionaire today, assuming I hadn’t sold. It, but, you know, I don’t know what I would have done had I bought it back then, how much I would still have I mean, I have no idea, so it’s hard to say, but clearly, you know, I should have taken a chance on it. I didn’t do it. But that doesn’t mean that I, you know, I believe in it. I mean, just like I have underestimated how big the bubble can grow with us debt, and how much money the world would lend us before we had a debt crisis, I overestimated, I guess, the intelligence of individuals, you know, and now companies, with respect to understanding Bitcoin. And, you know, I had no idea that the bubble could could get this big. I think what’s really happened recently, you had two things. You had the introduction of the ETFs and Wall Street coming in and buying up Bitcoin that pushed up the price. I mean, obviously nobody is buying Bitcoin in an ETF because they want to use it for anything. No, they’re not using it as a currency. They’re just gambling on appreciation. And I think that kind of started to, you know, to wear off. And then, of course, you have micro strategy. Michael Saylor, single handedly, I think he’s bought in the last month, 11 and a half billion more of Bitcoin, a lot of it with borrowed money, but the rest of money he raises just by, you know, selling shares of stock. So he’s just been this crazed buyer that not only has pushed up the price, but has caused a lot of other people to buy it, to front run his buying, to try to make money off of the buying. And now you have Senator Loomis introduced this ridiculous bill to create a strategic Bitcoin reserve, which there’s nothing strategic about Bitcoin, and we certainly don’t need to have a reserve of it. But I think that the potential for this. And you had all these guys down at the Bitcoin Conference in Nashville, RFK Junior and Trump, you know, paying homage to the Bitcoin crowd, really pandering to that community, promising them this Bitcoin reserve, which is really a payback for their donations and their support. But I think that the prospect of the US government buying, you know, a million Bitcoin, regardless of the price, just buying every single month and never selling. You know, the Loomis bill says you can’t sell that Bitcoin for 20 years. I mean, what kind of reserve is it if you can’t use it? But So, but, you know, with all this stuff happening, I mean, that’s really what’s, what’s pushed up the price of Bitcoin, but I still think it’s a bubble. I still think it’s not digital gold. I mean, Powell got that wrong today. He was asked about Bitcoin, and he said he doesn’t see it as a competition to the dollar. He doesn’t see it as a currency. He said it’s just like gold, which it’s nothing like gold. So he doesn’t understand gold either. That’s another thing Powell. Powell doesn’t get but I do think it’s gonna collapse. Yes, a lot of people made money on Bitcoin. A lot of my neighbors have made a ton of money on Bitcoin here in Puerto Rico. You probably know some of them, and they, they always like to tease me about about the I didn’t get all Dan
Anthony Scaramucci 7:57
Moorhead, so, you know not, not to be so promotion. But yeah, I wrote this book. Dan came to the book party last night here in New York. Yeah, he’s here, you know, I guess I would say something to you that I would ask you to consider and get you to respond to. And I guess, you know, and there are people out there say that there’s more uses for gold and just jewelry, and there’s some industrial uses, and I accept all of that. But is there a database? A bank is a database. A bank is a spreadsheet. It’s a regulated spreadsheet. You have your assets on that spreadsheet. I have my assets on a spreadsheet. I move assets to you. There’s a spreadsheet. Is there a case to be made that this is an impregnable, fully distributed, fully decentralized spreadsheet, and that there’s value in that network, and as as 10s of millions, if not now, hundreds of millions of people are on that network, that there’s value in that Network. And so, yeah, that would be the Robert Metcalf explanation of the network effect. We say there’s no value in that network. So, so bid bitcoins value is zero
Peter Schiff 9:10
or, well, you know, look, they like to compare Bitcoin to the internet, right? And the beginning of internet, well, Bitcoin came around in 2009 2010 so you know, it’s, what is it? 50, you know, 15, 1415, years it’s been around. And, you know, I know, in the first 14 or 15 years of the internet, I noticed a very big difference in my daily life. You know, I went from never using the internet to constantly using the Internet. In fact, I today, I can’t even be without the Internet. I mean, my whole everybody, I’m on my smartphone all the time. The internet is probably the most important thing in my life. You know, as far as something that I use, something that adds value to to what I do. In contrast, you know, Bitcoin. Has been around for those 15 years. It hasn’t changed. The thing, I mean, other than the fact that some people have gotten rich because they bought it a long time ago, and other than the fact that if I turn on CNBC, all I see is Bitcoin commercials and people talking about Bitcoin, as far as in the real world, it’s done nothing. It’s changed. Nothing. Blockchain has changed, nothing crypto nothing has changed because of Bitcoin. So, you know, you have a cult. You have all these conferences, and people go and talk about it. You know, I was just in over the weekend. I was in St Bart for, you know, for Thanksgiving, I’d come on the plane to come back, the little prop plane, and the pilot sees me says, oh, when you, when you gonna buy bitcoin? You know, the guy’s mining Bitcoin his spare time. He’s, you know, it’s flying this, this, this plane for a living. He lives here Puerto Rico. But, I mean, apart from people trying to make money off of Bitcoin, it hasn’t done anything. So I don’t see the value. You know, Michael Saylor, I see his interview goes, it’s the only asset in the history of the world that has limited supply. No, give me, has he not noticed that there are hundreds 1000s of other cryptocurrencies, many of them have supply caps exactly like Bitcoin, I mean. And there’s an unlimited number of cryptos that somebody can create. You can create one, I can create one, and we can limit the supply to whatever we want, you know, so it the key is not limiting the supply. The key is the utility of the asset. That you’re limiting the supply of gold is the most useful metal in the world. There are more uses for gold than any other metal we have. It has properties that are very unique to gold and that are very special, and that are very valuable to mankind because of the things that we can do with gold. But there’s nothing unique or special about Bitcoin, other than the fact, yes, there’s a lot of people who believe in it now and who have built up all this computing power and this huge network around Bitcoin, but my belief is the main reason that all of this capital has been wasted and misdirected into bitcoin is based on the belief that the price is always going to go up. And that’s the whole basis of the micro strategy, strategy of continuously buying higher and higher cost Bitcoin with more and more borrowed money because it’s never going to come down. Because if bitcoin goes down, make MicroStrategy is bankrupt. But, oh, no one cares, because Bitcoin can only go up. I mean, we finally invented an asset that has no downside risk and can only go up, right? I mean, where have I heard something crazy like that? So I don’t see the real value there. You know? I don’t, you know, we, I make payments all the time, very quickly. You know, with my credit cards, I’ve used Zelle, I use PayPal, I use Venmo. We have all kinds of ways that I can send money instantly anywhere I want, very quickly. Cost nothing. I don’t see where, where I need Bitcoin to do any of that. I don’t nobody, nobody uses Bitcoin for that is I, you know, I don’t see what, what value it actually brings. I mean, it’s a sexy story that everybody tells to try to justify the price and getting people to buy it. But, you know, there are they. In fact, they view, they’ve already admitted that it’s not it’s not good as a, as a, as a medium of exchange. Nobody even pretends that anymore.
Andrew Brill 13:25
Are you concerned about your financial future or think your investments could be doing better? I’m Andrew brill, one of the hosts here on wealthion, and I’ve been there, not sure my money was in the right places. It’s why I’ve gotten help from a financial advisor. Maybe it’s time you think more about your financial future or get a second opinion about your investments. We’ve made that process easy. Simply go to wealthion.com/free to speak with one of wealthions, registered investment advisors for a free, no obligation, portfolio review. Again, that’s wealthion.com/free I’m now less anxious and confident I can achieve the financial goals I’ve set for me and my family. Ed Yardeni of Yardeni research was a guest on wealthion this week. Spoke about Donald Trump’s economic policies, given global unrest. He talked about the future price of oil. Ed believes the Fed will stick to the quantitative easing cycle and cut rates one more time this December, and he pondered the question of history repeating itself from 1920
James Connor 14:31
so let’s spend a little more time on politics. And as you mentioned, Trump and the Republicans, they won by a landslide. They took the house, they took Congress, they took the Senate. And so you mentioned that you’re expecting some volatility this year, and I’m wondering why, and also because the Republicans took Yeah, the White House and also the Congress and Senate. What does this mean for your expectations for the year? Well,
Ed Yardeni 14:54
there’s, there’s, there’s so many policy proposals that with many of them likely to get enacted pretty quickly. Okay, so there’s, you know, on the happy side, what the stock market liked once it was clear Trump won, is the promise to cut corporate taxes from 21% to 15% that’s a big deal. And then for the consumer, there’s he promised that there’d be no taxes on tips, that there be no taxes on overtime pay or on social security. That’s a big deal for a lot of lower income consumers, so that’s that’s important, and overall, those two should be positive for the economy. Then, on the other hand, he’s got the policies of that would possibly increase the deficit, which would be the tax cuts, and he’s also got policies that would increase tariffs, which could increase inflation. So, you know, the initial reaction for was from the stock market was positive, and the initial reaction for the bond market was, was not so much, but it’s a moving it’s a moving story here as a dynamic story. And now we have a new Treasury Secretary that’s been nominated, and this fellow seems to be relatively conservative in terms of how much he wants to see that the President implement. But let’s face it, we’ve seen Donald Trump before, and at the end of the day, it’s going to be all about what he thinks, not so much by what his policymakers think. But so the volatility in the market could be depend on how these things pass. They all going to be implemented all in one shot. I mean, from the get go, tariffs are easy to apparently implement with executive order, and so that’ll be the first thing. And stock market may not be too happy with that initially, and then all of a sudden we get tax cuts. The market might like that. So it could be a pretty bumpy ride here. But at the end of the day, I think the US economy is resilient. It’s proven that over the past three years, James, as you know, we’ve had this most widely anticipated recession of all times that never happened. It was the good doe recession, the no show recession, and the economy demonstrated that it could deal with a major tightening of monetary policy without having a recession. That was quite an accomplishment. That’s something we anticipated. But have to admit, even we’re kind of surprised by how well the economy’s performed, and maybe that’ll continue to be the case through thick and thin. The economy does well. There’s been so many roadblocks, so many hurdles, over the past few years, and yet here we are at record eyes in the stock market.
James Connor 17:49
The price of oil has been hanging around $70 for a good part of the year, and this is in spite of what’s happening in the Middle East and also in Ukraine. And I almost get the sense that if we didn’t have these hostilities going on, oil would be a lot lower, 60 watts a barrel, maybe $50 a barrel, I don’t know. But what are your thoughts? Do you think it’s at this level just because of a slowdown in the US economy or the global economy? Well, I
Ed Yardeni 18:14
think the most important explanation for the weakness in oil on the demand side is China’s weak. China’s property bubble burst. We know from what happened in Japan in the 80s and the United States in the 2000s that once the property bubble bursts, it takes several years for it to no longer have an adverse consequence on economic growth. And I would argue that the Chinese housing bubble is probably the biggest housing bubble of all times. And so that being the case, I think that’s depressing the Chinese economy. The the one child policy of the Communist Party has come back to haunt them. They’ve got a geriatric demographic profile which is clearly not stimulative to consumption. Consumers have a negative wealth effect from home prices being down and from the stock market being down. Now, of course, they are doing their best to try to stimulate things, but I think they would have to do something pretty radical, kind of like what we did here in the US during the pandemic, and that’s actually send people checks to have them spend it without the consumer actually increasing their spending. I don’t know that the Chinese economy really is going to perk up. And the other thing is, with regards to energy, is they’re driving a lot of electric vehicles. I mean, that’s one that’s one country where I think the electric vehicle push really is turning out to be a big deal, and that being the case, that reduces the demand for oil. It doesn’t reduce demand for energy, but they’re building more and more power plants, and they’re building their electrical power grid to handle all. That, of course, they’re doing some of that, maybe a lot of it with coal fired plants. So that kind of counters what the world is trying to do in terms of reducing the amount of carbon carbon in the air. But that’s what they’re doing. India is doing very well. But, you know, I’ve been to India, but I’m told the traffic is horrible. So I got, I got to believe they’re burning up a lot of gasoline. But then again, they’re not getting very far. So India just hasn’t been the kind of growth market for energy the way China has been in Europe is is a mess. I mean, it’s got a lot of problems, and their their economy is kind of bumping along, struggling along. So that’s the demand side. The use is doing fine. We’re driving gasoline. Consumption is relatively high. We’re also buying electric vehicles. But on the supply side, there’s just a lot of oil, and it’s the Russian oils getting out one way or the other, and probably being and being sold to China and India and the United States. Said, despite Biden saying that he’s against fossil fuels, we’re producing at 13 million barrels per day in the oil fields, which is a, you know, basically a record high because of the productivity of the oil industry. So you put it all together, and it’s hard to see much, if any upside here. And even with the geopolitical crisis, as you mentioned, we haven’t been able to get the price up at all, really. And so now there’s talk that Hezbollah and Israel are going to have a ceasefire, and maybe that’ll start to calm things down. But you know, we still have the issue to resolve between Israel and Iran, and that may still involve a military confrontation between the two of them.
James Connor 21:58
So when we spoke a year ago, I want to talk about the Fed now. But when we spoke a year ago, there was, there was individuals out there calling for six cuts in 2024 and we’ve had two cuts. We got 50 in September. We had another 25 in November. We have one more Fed meeting coming up before the year end. What do you think they do? Well,
Ed Yardeni 22:19
you know, I, don’t, I didn’t buy into the multi cuts in the Fed funds rate at the beginning of this year. And you’re right, the people were talking about six to seven rate cuts this year, and then we got closer to the fall, and people were talking about 25 basis points at the September 18 meeting, and we’ve kind of caved in and said, okay, they’re gonna, you know, they’re not listening to us. The economy doesn’t need it. Inflation is moderating. The economy strong. The Fed doesn’t really need to cut rates. Rates are actually probably where they should be, but they just wouldn’t listen to me, and instead, went their own way. And not only did they cut, but they cut by 50 rather than 25 basis points. And my reaction was, watch the bond yield go the other way. And that’s exactly what happened. The bond yield went up like 75 basis points after that meeting, and then they went down 75 basis points, all told, so far this year, by cutting by another 25 November. There’s they believe that the Fed funds rate is restrictive. And I said, Well, wait a second, they’re supposed to be data dependent, and I’m looking at the same data as they are, and I’m saying the unemployment rate’s just about 4% inflation is about 2% I mean, aren’t we there? I mean, it’s like the kids, you know, you take a long drive and the kids are in the back seat saying, Are we there yet? Well, we’re there. We’re at Nirvana, where, where you’re we’re supposed to be. And somehow they think that these rates aren’t are too high, but the economy has demonstrated that it could do just fine with this level of interest rates. So I’m not convinced that they really have to lower interest rates much more. I think they’ve sort of started back off and say, Well, you know, we’re still lowering rates, but maybe more gradually, which is fine. I mean, if they want to do it slowly and and see how the economy is responding, they were going to do that anyways. But I think interest rates have normalized four to 5% bond yield is kind of where we were before the great financial crisis, before all the abnormality was zero interest rates. It wasn’t, it’s not, not a Fed funds rate of, you know, four and three quarters percent. It’s not a bond yield of 4.25%
James Connor 24:48
okay, so let’s talk about the stock market now. And you mentioned this concept of irrational exuberance, and I think we see this. We see a lot of it going on right now. When you look at it here in the s, p, it’s up 20. 5% on the year, give or take, but you have a lot of individual stocks, like, I’m gonna say micro strategy, it’s up 500% on the year. Palantir is up 250% Nvidia is up 200% like, these moves are just astonishing. And then just recently, I’m sure you saw this individual his name was Justin sun just paid $6 million for a piece of art which was essentially a banana to the wall. Yeah, not taped to the wall. But when you see things like that, these moves and also this piece of art going for 6 million bucks. Does that not concern you a little bit, that we might be in a period of irrational exuberance?
Ed Yardeni 25:37
James, it concerns me a lot. It concerns me that I picked the wrong career. I should be an artist and just tape a banana to the wall and, you know, get $6 million for that. That’s, that’s, that’s pretty sweet, if you can, if you can, do something like that. And I think you forgot to mention Bitcoin. Bitcoins also been kind of that verdict vertical ascent we’ve seen in some areas of the marketplace. So kind of the the irrational exuberance, aspects of irrational exuberance are certainly there. Interestingly, though, of late, the market seems to be broadening out stock market to mid caps, to small and mid cap stocks, and there’s no irrational exuberance there. That’s quite the opposite. They’ve been really cheap for a long time, but, you know, irrational exuberance could lead them to be overvalued pretty quickly. We see some pretty remarkable moves in a very short period of time. So I am starting to see a little bit too much bullish sentiment. And so, yeah, I may have to reconsider the subjective probabilities that I assigned to kind of a civil bull market that carries us through the end of the decade without any major drama, and reconsider the potential for a 1990s kind of, kind of melt up, because there are aspects of it. But you know, some of these areas where we were seeing the market, the big moves to the upside, this kind of justified bear earnings. I mean, Nvidia certainly looks like it’s it’s still justified by earnings, and its growth rate is what is it now? Only, only doubled over the past year. So that’s a little bit disconcerting, I suppose. But yeah, I mean, the bottom line is, there’s, you know, irrational exuberance is here in some areas, for sure. And
James Connor 27:36
I you mentioned earlier that there are a few years ago, you’ve actually coined this decade is the Roaring 20s, just like the 1920s and we all know how the 1920s but makes me think of that book. I’m sure you read it by Charles McKay, the madness of crowds. Yeah.
Ed Yardeni 27:57
Well, I think you’re making a really good point, and that is, you know, history is relevant, and it doesn’t repeat itself, but it rhymes. And in this case, I’ve been thinking that what causes recessions in bear markets is tight monetary policy. So we had that, and we actually, as we noted earlier in our conversation, I’ve been kind of pushing against that. I would say, You know what the surprise this time is going to be that monetary policy doesn’t cause a recession because the credit system is more resilient. The economy is more resilient, consumers more resilient. I made a lot of arguments which are more specific why I thought the economy would handle it. So all right, so let’s, let’s move on. What else could cause a recession? Well, oil prices soaring, shortage of oil. We’re all waiting in gasoline lines, not able to enjoy our lives. Go on with our lives, and so here we had the geopolitical crises, and the price of oil is down, and there’s plenty of oil Iran. Okay, so that didn’t cause a recession. So what’s left? Well, as you said, the 1920s ended very badly. And I think we all know, there’s no debate that one of the main reasons that it did was because of the smooth Holly tariff, which was passed in May of 1930 and that shut off world trade. So I guess we can say, Oh, if we can’t find any recent reason for why this economy should have been in a recession, well, we got a new one here, which is an old one, and that’s tariffs. And if we get tariff wars, then we very well could see a global recession. So it’s a very good point, and it does make the 1920s relevant as history, because while there was a lot of fun for a while, it’s when the government implemented this horrendous tariff and policy that things started to really fall apart. It wasn’t really the special. Speculative excesses in the market. It was, it was a recession, a depression caused by a smooth Holly tariff. So I would put that certainly in the bucket, in the bucket of what could go wrong geopolitics is still in there, but maybe it’s less of an issue, and the debt crisis is still in there, but again, maybe it’s less of an immediate issue, and then all of a sudden, because of Trump winning, we got tariffs in there. And it’s it’s more of an issue. The charismatic
Andrew Brill 30:26
low Tigray of the independent speculator stopped by wealthion and spoke about rising unemployment and false data reports, given the recent news about bricks, he talked about the dollar versus bricks, and given the power needs of AI, Lobo is very bullish on uranium,
James Connor 30:46
and I want to have a deeper discussion on gold. But before we do that, I want to continue on with this theme about the economy. And as you mentioned, the non firms are coming out this Friday, and I guess that will, depending on those numbers that will validate or invalidate your thesis. But your concern, if I understand you correctly, is this growing trend we’re seeing in unemployment? It bottomed in q1 of 2023 at 3.5% the last number we saw was 4.2% so the trend is definitely up. Do you think it continues as we enter 2025
Lobo Tiggre 31:17
Well, I think it was for one. It was flat over the month before, but that was only because of labor force participation rate dropping. So if you know other things having been equal it, we would have actually seen an increase in unemployment. And you know the establishment survey versus the household survey. So if you ask establishments, Hey, are you full of workers? And they say, yeah, that captures the illegal workers, which I’m I’m not. I’m not hostile to illegals as so many are. I’m not a big fan of the big deportation plan. In my view, the problem is not people that want to come here to work my my view, the problem is giving people, you know, socialist benefits for coming here and not working. But anyway, I don’t want to get into the politics of that. My point is that the employment situation is actually worse than the headline numbers make it appear. And I think even on the mainstream you’ll see some admission of this. You know the number of new jobs that are government jobs, right? You know the number of new jobs that are part time jobs. I think the more you know the people that aren’t trying to make the current administration look good, the more objective observers out there, not just tinfoil hat Lobo, but mainstream types, everybody can see weakening in the labor market. And I think that’s one reason why, despite sticky inflation, which we also got, and when we just got PCE, supposedly the Fed’s preferred measure of inflation going up, and yet, the market odds of a rate cut coming up this month also went up. You know, why would that be? If inflation is going the wrong way? Well, it’s because I’m right about the weakness in the labor market, and I think everybody can see it, everybody objective, and maybe even the non objective ones see it, but just don’t admit it. So I don’t want to say that everything hinges on this one number, but this one number will be very important for validating or invalidating my thesis. Fortunately, you know, my thesis wasn’t, you know, sell everything, or if I’m wrong about the undeniable recession, I’m not actually going to lose money because, you know, my therefore bet was, you know, gold higher, gold and silver higher, and that has happened this year. So I’m actually okay. Where this could hurt me is that because I’m still in this hard landing camp, I’m not ready to buy into copper or oil or other industrial minerals or energy place except uranium, of course. And I may miss the bottom. I may, you know, I’m not trying to time the market. I’m just reluctant to buy when I see a sale price ahead, and that may cause me to end up having to pay more in the future. But you know what? That’s that’s better than losing money, and if I have to pay a little bit more, but I’m betting on a long term bullish trend that I’m very optimistic, and you haven’t asked me about 25 yet, but you know, I’m not worried about missing the bottom. It’s i I’d rather do that than bet big now and then have a fire sale price next month, right? I’d be kicking myself either way. I think I come out ahead
James Connor 34:33
this year, we’ve heard a lot of commentary about the BRICS nations and how they want to come up with another currency to overtake the US dollar. And Trump really recently made a comment regarding the BRICS nations, and he is threatening 100% tariffs on any country who tries to undermine the US dollar. What are your thoughts on this?
Lobo Tiggre 34:54
It’s political grandstanding. I mean, how do you define undermine the US dollar? How. Do you? How do you show that somebody has undermined the US dollar and slapped that 100% tariff on them? Very vague, arbitrary. I also understand, though, that it wasn’t just, I mean, there are different headlines here, but this more specific, actionable thing is, if you implement a bricks currency as an alternative dollar, then I’ll put this 100% tariff on you. But that’s just an idea. And I know that gold bugs, you know, my dear fellow gold bugs, have been talking about this bricks, gold back currency, for a long time. But every time it comes up, or there’s an opportunity for it to come up at our bricks, meaning it doesn’t. And you know, the last time there was this big fuss about in South Africa, last year they were going to introduce the gold back bricks and and, you know, Russia ever wanted to stir the pot, was saying, oh yeah, this is, this is coming, and the South African hostage. It wasn’t even on the agenda. Never mind a gold backed bricks currency. There was no bricks currency even on the agenda. Lo Behold, nothing happened. So at this point, all the evidence suggests that at most, BRICS currency, whatever it’s backed by or not, is just an idea. And if it does happen, it would take years to implement. This isn’t the sort of thing. You just flip a switch and it works. You’re talking multiple governments that don’t trust each other, don’t even speak the same language, right? Are not all on the same economic page. You know, very different economies, to get them to come together and put this together. It is, even if it’s happening now in secret, something that would take years to deploy, perhaps or probably longer than Trump has to be in office. So it’s just bluster and grandstanding. As far as I’m concerned, that said he’s telling other countries what to do and what not to do, and making threats that could produce backlash. I’m sure that the die hard. You know, Maga hardcore Trump supporters loved it. Yeah, those anti dollar people sick it to him, but it’s a dangerous thing in a multi polar world to be, you know, throwing threats like that around. So we’ll see what happens. Ultimately, though, if this were to actually happen, it would, I think it would totally backfire. It would be all the more reason for other countries to say, you know, what the US is trying to control us. We need something besides. We need to get out of under the US is thumb. And the main way the US keeps other countries under its thumb is control of the dollar. We just saw that with kicking Russia out of, you know, the weaponization of the dollar, kicking Russia out of the SWIFT system, and so on. I actually see this is very good for gold, once again, not to harp on that one thing, but these are your questions. And you know, whatever happens with this, I see it as being pro gold, and I just hope that it doesn’t blow up in the US is face.
James Connor 37:58
So let’s move on now and discuss nuclear energy and uranium. You’ve been very bullish on uranium in the past, and it’s down on the air, which I find quite surprising, because I don’t think there’s another sector that has a more bullish or more positive backdrop than nuclear energy and by extension, uranium. But what are your thoughts on uranium? Here it’s down. What is it down 10 or 15% on the year? Well,
Lobo Tiggre 38:25
well, first, I don’t want to dislocate my my shoulder, patting myself on the back, but it’s not surprising to me at all. This last time we talked, it was in August, but if we talked before that, around this time in 2023 I was saying a my highest conviction trade for 23 was uranium, and that doubled in that year. So that worked out well. But my highest conviction trade for 2024 despite all that you say being true about the fundamentals for uranium, was not uranium, it was gold. That’s worked out well for me this year too. But the reason for that was the answer to your question, uranium shot way up way over the incentive price needed for high prices to start to cure high prices. And it’s normal when a market goes vertical like that. I mean, gold’s up 25% this year, but uranium doubled last year more than and up over 100 bucks an ounce, when the incentive price was maybe 7080, bucks, and the long term contract price was still way but it was like maybe 50 or 60 at the time. It took time for the long term contract price to to catch up. It was, I think, perfectly reasonable to expect some kind of pullback. And I got a lot of hate for saying that, but I was right. I’m sure glad I shifted my focus from uranium to gold in 24 and it’s playing out now. I mean, I remember in in 22 people were wailing and pulling out their hair because uranium hadn’t done anything all year. I kind of feel the same way now that people. Are maybe not quite so anguished, because it, you know, plus or minus 80 bucks a pound, it’s hard to be too, too despairing about uranium. But it hasn’t done anything all year. Well, you know what? Mr. Market doesn’t care what you want or, you know, it will move when it moves. To my mind, the correction was completely to be expected. It’s very telling to me that uranium corrected basically down to where the long term contract price had risen to, and that has provided a floor under spot that’s perfectly normal. Spot often runs away ahead, but then they converge over time, and I think that’s encouraging it. I don’t actually see a lot of downside from here, high prices are incenting mothball mines to be brought online, new low cost projects to be brought online. So all that’s working, and it’s natural for the market to be concerned. Oh, well, you know, high prices cure high prices. Let’s see what happens. But on the ground, the reality is that these restarts and these mine builds, they’re almost all of them are behind schedule, or they’re slower, or they’re not as much even because Adam prom, which, again, I’m not recommending one company or anything. I’m just this is important because it is both the world’s largest and lowest cost uranium producer that makes it the supplier of marginal pounds to the market, and it is just petitioned to its own government to cut its permits so that doesn’t keep missing its permitted usage like it keeps failing to deliver as much uranium as it’s supposed to. I think that’s really telling for the, you know, the largest and lowest cost producer, to cut its guidance in that way. So I’m extremely bullish, but I understand why the market says, Oh, well, we have new production coming online. There could be a surplus. I think they’re wrong. I think it’s taking longer. And even if all those mines do come online our own, in house math, we have another free report on the uranium market, if anyone’s interested, says that this new supply won’t be enough. So I’m very bullish. That said, you know, is uranium going to double in 2025 you know, that seems unlikely. We’re already above the incentive price, or at or, you know, the incentive price at least. So I think it goes higher. I think it, you know, it keeps going higher. I think long term contract prices will continue going higher and it’ll drag spot higher in time. But I’m, you know, I’m not looking for a hockey stick upside here. So I like uranium. I’m actively seeking to add more uranium in my portfolio, but I see more upside elsewhere in 2025 specifically
Andrew Brill 42:36
Wall Street veteran Jordi Visser joined wealthion This week, he got into de globalization versus decentralization and commodity prices. He wondered, like many of us, when will crypto and AI become mainstream, saying it’ll be full scale, adopted in the next five years. So get on board or be left behind. He talked about different generations and how they view the volatility of Bitcoin. So you think that gas, I mean, gas at the pump right now is relatively low considering where it had been, you think that even, even gasoline, oil, that sort of thing, will start to tick up. I mean, the the situation around the world isn’t so great. So geopolitically, there could be some uptick there as well.
Jordi Visser 43:25
Yeah, there’s a couple things here, and I think this finally gets us into the election part. I think with Trump winning, people are going to have to start to reassess how countries view their own domestic politics, because I think that’s one of the features of this. So if you think about de globalization just as a theme, and I’m kind of, I’ve always been focused on de globalization, we still have that happening in many ways. But with Donald Trump taking over, I think whether you call it de globalization, it’s starting to migrate into decentralization, but also deregulation. These are a bunch of things which, for me, are going to force most economies around the world to think domestically and figure out ways to not be impacted by, say, tariffs or just the fact that the US is going to make things more uncertain. You’re not going to know what’s going to happen on a week to week, month to month basis, and China just had a PMI number, which moved higher. I’m definitely in the belief that China has already taken the reins and has put a floor into their economy for this year. And so that leads me to believe that the surprises there, particularly from a consumption basis, will be on the upside. And I think people have underestimated two things on energy. One is the whole EV car thing seems to have got people complacent that there’s nothing that can really make gas at the pump go higher. We’re down to $3.04 as of today. It’s a big fall, and that’s one of the reasons why it’s kind of surprising that inflation on the core side is actually seven. Stabilized up here, because goods are definitely on the lower side. And so if China’s now got their PMI seeing two back to back months on the caisson of one point or more, the US PMI numbers came out this morning, they’re up above 48 and almost all the outlooks for the regionals are suggesting more optimism, with Trump coming in from a regular regulations basis. So people are starting to get a little more optimistic there. And then I think there’s also going to be a front loading of orders on the fear of tariffs taking over, which will probably lead to a little bit more of a bounce. So I think you’re going to get some upward prices on energy in the early, you know, at least early in the year, when, when we have the when Trump takes over. But then I think the other theme, which I’m sure we’ll get into later, is I’m a big believer that the AI power needs are going to become relevant or become really, really recognized by the world as we get to the second half of next year.
Andrew Brill 45:54
So let’s get into cryptocurrency. And I do read your sub stack, and I in am in the age group that you you, you said that crypto is a speculative fantasy. You grouped AI in there a little bit too, but it seems that, and I’m curious to your take calling it crypto currency, is that what’s holding a lot of us back? I mean, we all keep a little cash in our pocket. We look at that as currency. But this is a digital world, the way you pointed out with the the iPhone, and it’s going to take just some education and getting used to it for it to become mainstream, isn’t it
Jordi Visser 46:36
for people? And I think the age that I chose in there is the defining line was 44 right? And I’m above that line. The reason I chose that line is because that’s where a bunch of all the demographics intersect. For me, you know, the percentage of people by demographic that use AI, it’s dramatically higher for people under 44 and dramatically lower for people above the age of 44 Same thing goes for crypto on an ownership basis and a use basis. But then when you go to global net worth, the people above the age of 44 own over 90% of the global wealth. So it’s a weird I mean, it’s we’re in a very, very fast changing world. So when the Bitcoin white paper came out in 2008 a month after Lehman Brothers, if you go back and spend time on on what it was, and you break it down into two components, one just being the frustration towards governments and banks and the fairness this had been attempted many times before, many thoughts had come through. You know, some kind of financial, competitive currency to represent it had been there. But I think cryptocurrency, to your point, is just a bad marketing thing for Bitcoin, and I think that’s what confuses people. I don’t view Bitcoin in any way, shape or form, as as a currency. In fact, the technology behind it for payments and transactions is it’s not great, and so that’s why you’ve had things like Ethereum and Solana, which are much more geared towards speed, much more geared towards being able to handle the higher volumes. That’s a better technology. These These particular ones, and I think that’s why they’ve gathered steam. So I have focused on Bitcoin as the store of value bridge between the physical world, where we’ve all basically been until the digital economy, which really, again, started accelerating in 2007 with the iPhone release. So I don’t think people have put this all together, but within a span of july of of Oh, seven is when the iPhone was released, October of 98 sorry, October of 2008 is when the Bitcoin white paper came out. And that, to me, was the white paper for explaining to people how, as technology accelerated, you were going to need the innovation of the blockchain to basically take decentralize the world and erase the middlemen, which means less government, less profits for the banks, and that’s really what it represents, and that’s what you’re seeing, and I think that’s the trend that’s happening. So I’m writing more about it because a it’s the most interesting macro story I’ve seen. I do believe in accelerating innovation, and I use AI three to five hours a day. I have more apps, and I do more things on it today than I did yesterday, and it just continues that way. And I have the luxury of being now a consultant and helping people kind of bridge their own mindset, because that’s the part that’s the hardest, Andrew is I just think people above the age of 44 it’s very hard to forget what you’ve already learned and what you went to school for. And. It’s very intimidating to think about learning AI and to think about investing in Bitcoin. I’m just shocked at how many people I have to explain how important it is not to invest all your money there, but at least to diversify by some amount. How
Andrew Brill 50:13
do you explain the volatility and the lack of perceived value? Obviously, there’s value Bitcoins, 9596 97,000 but there’s a perceived lack of value, and that’s why people are hesitant to accept it, I guess. Is what the best word we can use? Yeah,
Jordi Visser 50:39
let’s see, I remember when I took a trip to China, and on that trip, I ate scorpions, and I was forced to eat turtle at a luncheon. Now these are normal foods out there that you can buy anywhere in the United States. Not so much. You’re not going to find them in places. It’s not the same. And the reason I bring that up is no evil Harare and Sapiens really taught me a lesson to understand everything is a story. So when you say value, value is something that is perceived by people, if something goes higher, it has value. That’s why I brought a Baseball, baseball cards. If you have the right baseball cards, they’ve gone up in value. So it’s it’s been a good store of value. If you put money into it, if you buy a Picasso, if you buy anything, it’s been proven to be good value. So value is just really representative the story behind it that other people are jumping on board with so to measure Bitcoin for value, when people talk to me about how you you come up value ago, well, when the internet was growing, the number one thing we use to measure whether it was going to be successful is how many people were using it, how quick the user adoption was, what? Well, that’s what’s going on with Bitcoin. I really appreciated the 2020 2021, 2022, period. So after my son’s peak in his net worth, which happened in like February of 21 bitcoin peaked, and then it went from 70,000 ish down to 16,000 ish. That was peak to trough that year. In 22 it was down about 55% so when I get asked the question about, How do you deal with the volatility, I always say, well, let’s see. It was down 55 60% in 22 how much was Amazon down? And most people don’t know, but Amazon, which is something that has a higher market cap, it was also down 50% the NASDAQ itself was down over 40, or down about 40. So what you’re dealing with when people talk about these things is they haven’t adjusted to the story. But the problem is, if I talk to my son, he has, if I talk to people in Argentina, they have, if I talk to people in Brazil, they have. And that’s why I said at the beginning, I just happen to be in an age bracket where I’m talking mainly to people in their 40s, 50s, 60s and 70s. They haven’t embraced it, but people below that age already have. So it’s the people with the money that haven’t embraced it. But the one thing I know about all of those people, they are greedy. They go to they go to tennis clubs and golf clubs and all kinds of places, and the first thing they hear is, hey, do you own any bitcoin? They will all own Bitcoin, because that’s the way all this stuff ends up going it always has.
Andrew Brill 53:41
So how does Jordi? How does AI fit into all this? And you wrote that AI is moving faster, changing to I mean, you made the point earlier that you use it every day for several hours, and it’s changing daily. How does AI fit into all this?
Jordi Visser 53:57
So for me, the connection of AI to Bitcoin in particular, has to do with the digital economy. So Bitcoin is nothing more than a digital asset. That’s it. So we’ve got the assets of the physical slash Fiat world. And when I say Fiat, that’s paper money world. So the things that most people have grown up on, like I own the S, p5, 100. Okay, Bitcoin is a digital asset. There’s a there’s a finite amount of them, so there’s a scarcity issue. There’s no scarcity issue. On Apple stock, they can issue as much as you want to issue. In fact, micro strategy, which has gotten a lot of attention, people are still trying to figure out how Michael Saylor is doing. This This has got to be a bubble. Everything makes no sense, and yet he’s just selling Fiat assets to go buy digital assets. That’s basically what he’s doing. He’s issuing stock that people are buying, or convertibles that people are buying, and then he’s taking that money and he’s going and buying the physical the. Digital asset. And so this world is connected the digital economy and the physical economy. We’ve all seen the rise of innovation. As soon as we started having an iPhone in our hand and started doing the things we went it replaced physical assets, this was our doorway into the digital world. So before the iPhone and I it’s amazing how, only after 16 years, people forget you watch TV shows from like, 2002 2003 and they have these flip phones, and they have phones, and you’re like, okay, there were still cameras back then. If you look at how many cameras were produced globally in 2002 there were millions of them. Now there’s none. I mean, there’s literally, if you look at a chart, it looks like zero. So the digital asset side, to me, is going to be accelerate. We’ve been moving to the digital economy since the iPhone. The iPhone started the same time as Bitcoin there. So they’re kind of brothers, if you want to use that they came out the exact same time. We’ve watched our kids sit there and play Fortnite. We’ve watched how quickly Fortnite became something big. The digital economy is just going to continue to grow and continue to be a bigger portion of the economy, while things like Ford versus Tesla make no sense when people doubted that Tesla could have a market cap a car company at a trillion dollars for GM, Toyota, all of them combined, don’t even get close there, and that’s been the case for a while. So AI is an accelerant on the iPhone. It’s the next phase. And so far, all we’ve done in the last two years since chatgpt is build out the infrastructure, and Nvidia has benefited. I have believed, and I’ve written about this, and I’m writing another paper this week on it is on AI agents, because I talk to people about AI agents, and they just, they don’t have an easy time with that, either. To me, AI agents are the accelerant for getting into the digital economy, and that is going to accelerate the amount of money that is moving into this other economy, the digital economy, through payments. And the reason that the payments are so important is, again, I think because technology has done so well and because their market cap is so big, people actually think that most of the profits in the world are in the technology sector. Financials are still enormous. Every single person who’s watching this, at some point, I’m sure, in the last 10 years, bought a house, and you just think about how many people come with their hands to take money from you, related to just buying or selling the house, the taxes from the government, the funding from the bank, the mortgage payments that go on, the insurance, all kinds of stuff that has to happen. Those dollars are part of the economy that will be replaced more and more by AI agents. The same thing will happen in the healthcare sector. Same thing will happen in call centers. All that stuff is about to accelerate now, and that’s why the next five years is about AI adoption rather than AI infrastructure.
Andrew Brill 58:05
So when we talk infrastructure, we’re talking about the chips, the cooling racks, but you’re talking more about the the software that’s going to actually let this AI work and stuff like that, right?
Jordi Visser 58:22
Exactly. This is the part and again, in a span of just give you my brief journey. So my hedge fund closed in in May. So we’re now about six months of not going into an office every day. So the work that I do now is content, and it’s helping people and consulting people for how do they think about investing in it, for portfolio diversification? How do they make the transition, speaking in front of groups like this, but more in public, to help their clients and stuff. So that’s really where my focus is going to be, and to really set up the business and go through I decided, since I didn’t have the time while I was going to a job where I found out how much time you waste going into work to commuting time, the whole thing, and I did more of my work at home on the computer that I’m sitting here with. So I took five coding classes. I had always hired data scientists and coders to do the work for me, and I just wanted to learn the basics of coding, so I took five Python courses. These were online Coursera courses. I finished them within a span of about six weeks, and then I started to work on some tools where I was building my own things that I used to have data scientists do now. At the same time, I was using AI regularly, and my coding was bad. But the great thing was I would go back and forth between chatgpt to write the code, and then go back into the terminal and run my Python script and go through it, and I. Could do things. It was still kind of clunky, and I don’t think the coding was particularly good back in July, but what’s happened since then is it’s gotten phenomenally better. Thank you
Andrew Brill 1:00:10
for watching this week’s recap. If you need help planning your financial future, head over to wealthion.com/free for a free no obligation, financial review, and please follow us on show social media. All the links are below in the description. If you haven’t done so already, please make sure to like and subscribe to our channel. Don’t forget to turn on notifications so you never miss a video. Thanks again for watching. If you like this content and are looking for more ways to keep growing your investments, watch this video next until next time, stay informed, be empowered and may your investments flourish.
