Follow on:

In this episode of Speak Up with Anthony Scaramucci, reformed hedge-fund manager James Lavish, joins Anthony to discuss the latest on crypto, investing and the economy. Lavish delivers a stark warning about an economic crisis that could surpass the Great Depression in severity. James and Anthony dive into the implications of recent federal rate cuts, the looming threats of inflation, the state of the global economy and will touch on their market predictions within the crypto market. Learn exclusive wealth protection strategies and hear Lavish’s predictions that could safeguard your financial future.



James Lavish 0:00
I had dismissed it of sitting in this is really important that was sitting in wall she was sitting at a hedge fund the what the one area in Wall Street where you would be looking at these things and I just dismissed it outright you know it’s a Ponzi scheme it’s not worth anything has no underlying value it’s going to collapse gonna go to zero and so I didn’t pay attention

Anthony Scaramucci 0:26
beaming in from sunny Disney World Joining us now on speak up James lavish he’s a managing partner of the Bitcoin Opportunity Fund James, it is incredible to see you I’ve been dying to do this interview, you have a hybrid funnel that you tell everybody what that’s all about. It makes public and private investments in companies and assets in the Bitcoin ecosystem. But welcome to the show. I appreciate having you on tell us a little bit about your fund. And then we’ll get into some other fun stuff. Of

James Lavish 0:56
course, it’s great to be here and thank you for having me. And it looks nice and sunny out there. I’m in Vegas. So I know, I know what you’re dealing with. But yeah, the Bitcoin Opportunity Fund, I’m a co Managing Partner of that with David Foley you know, traditional asset managers coming into the Bitcoin space and what we’re doing is we’re we have that hybrid model, like you said, we’re we’re looking at any opportunity that Bitcoin space, so in the Bitcoin ecosystem, and public private, early stage, late stage, the point of our structures that we can take advantage of any opportunity, and the space is so small, we felt it was important to keep it open. You know, we’ve there are a lot of just venture capital funds out there. And of course, we could be an also ran there, but we we deliberately structured this fun so we could take advantage of any opportunity.

Anthony Scaramucci 1:45
Okay, so I’m I’m a 60 year old white male, which is definitionally miserable. Mazal. Just say that upfront. I’m a dyed in the wool cynic. And I think Bitcoin is a decentralized Ponzi scheme. Now I beat you in the elevator. Tell me what I got wrong. James, tell me tell me what I enlightened me. Give me an anti Cintas. CISM. Tonic. I deal with these people all day, by the way. That’s why Yeah, I’m asking for some help here.

James Lavish 2:19
Typically, what I what I start with is just the the money and how the money is broken, and how fiat money is broken, and specifically Fiat that are created by and bonds that are issued by sovereign states that that create their own fiat currency. And so if you want to look at Ponzi schemes, this is like the ultimate Ponzi scheme, right? Where you issue debt, you create more money, and you expand the money supply. And and in order to deal with that debt, and so it’s easy to start with just the simple question, why is inflation necessary? And do you feel that it’s normal? And most people say, yeah, 2% is normal. And then when you break that down, and they start to understand why 2% Inflation is really just a target. And the only reason that they do it is because they can get away with it, that gets people to understand, okay, the money is broken. And when you have a when you have money that’s been created digitally. And then you go to the digital gold Comparison, where Hey, gold has been around for 5000 years. If you you know want to buy a nice, if you want to buy it, one ounce of gold, you like 350 loaves of bread back in Roman times, right. And now it’s still about the same 350 Nice loaves of bread for an ounce of gold. If you want to buy a nice suit today, it’s the same thing you it’s about an ounce of gold, versus a nice suit back in Roman times, it’s an ounce of gold. Now we have progressed into this fiat system that’s been around for a couple 100 years at most, and and it’s obviously faulty, and it’s got problems. And so and it’s just been this really narrowed test case in history. And now we’ve got digital gold to replace the physical gold, which has much superior properties to it. And that’s and so that’s kind of where I walk people into show how the money’s broken. Talk about how this is a gold 2.0 3.0 upgrade, and then they can understand why it’s why it’s important, why it’s a necessary protocol for us. Okay,

Anthony Scaramucci 4:39
so I’m starting to understand it. I’m becoming slightly less cynical, and it’s slightly more enlightened. So you’re let me let me let me say it back to you see, if I have it, you’re basically saying that we’ve corrupted the system the central banks have effectively been drunk driving with our currency a result of which people I have lost trust in fiat currency. It’s not just here in the United States. In fact, the United States has been more benign, frankly. And some of the other countries forget about the western democracies about the rest of the world, places like Argentina, Africa, South American states, they’ve lost control of the money and the people in those countries have lost confidence in the money, which is why there’s places like El Salvador experimenting with Bitcoin saying, Okay, listen, we’re gonna put ourselves in the decentralized, we’re gonna put ourselves at the behest of the decentralized bank, as opposed to a centralized bank, something where individuals can have control. Do you believe though now, I’m gonna push you harder, if you don’t mind? Play the skeptic further? Do you believe, though that people believe that? You and I believe that, but do you believe that people will eventually get to where you and I are?

James Lavish 5:59
Yeah, well, you have to take a leap of faith. When you’re in a developed Western country that in especially in the United States, we have the benefit of being the global reserve asset and the global reserve currency in US dollars and treasuries. So we, we look at Bitcoin, typically, people in the United States come to Bitcoin as an investment, as a way to make a bunch of money, as you know, it’s an alternative way to make money. It’s, it’s just something interesting and out there on the risk curve, right. But if you go to those countries, you’re talking about Venezuela, Argentina, Lebanon, Egypt, these people need a place to store their hard earned money. So you go out to work, you work for this, you get compensated. And if you don’t want to spend all that immediately, and you want to save that, where do you save it? You can’t access US Dollars typically out there difficult to get? They’re super expensive. So how, what do you do? Do you just keep it in your currency? Do you keep it in the Bulevar? Do you keep it in the peso? No, you want to do something else with it? And so even the IMF put out a report that admitted that Bitcoin is important tool, a store of value for people in those countries, why they don’t care about the volatility, because they know it’s volatility, an asset that’s increasing in adoption, which means it’s increasing in worth, as opposed to if they put their money in the peso. They know that it’s volatile, but it’s decreasing down to zero, and it will be revalued time and time again. So this is a really important, you know, form of currency and foreign money for them to store their value in. And then secondly, if they want to flee someplace that is oppressive, you know, this, you’ve done a lot of work on this, Anthony that if you want to leave someplace, that’s oppressive. How do you do that with cash? How do you do that with gold, you can walk across the border, and I know somebody who has done this with his whole family from Venezuela, he talks about it, how he was able to sell all of their assets, put it into Bitcoin, walk across the border to America, have those you know those 12 words in his head, and they took their entire net worth with them, it would not have been possible without Bitcoin. So it’s a different mindset. And it’s going to grow kind of from from the ground up, in my opinion, it’s organic, and it’s going to grow in these countries that need it so badly. At the same time that now in the United States, we have the ETFs, which is allowed the institutional adoption of Bitcoin, and for them to understand it’s a first kind of step for for investors, institutional investors, we’ve been doing this for a long time. I’ve been in the game for 30 years. And so I’ve seen how difficult it is for people to get their head around fiat currency, the money is broken. And this is something necessary. So this, this is the next step. And it’s kind of it’s an evolutionary process. So it’s actually pretty normal, in my opinion.

Anthony Scaramucci 9:08
It’s about as beautifully articulated as anybody I’ve heard, so I’m gonna if you don’t mind, I’m going to be stealing and plagiarizing from you. lavish in the months ahead. Okay. It’s very well put. Let’s go back to the economy for a second. Okay, because I ask all of our wealthy on guests the same question. What’s relevant right now, you’re looking at the economy today. You’re saying, Okay, this is a trade I would put on right now. This is something I’d be doing with my personal money right now, today, and then based on why give us your perspective on the economy, and then something actionable that we could do this week? Yeah.

James Lavish 9:47
So I think the most important thing to that, that people are confused about the economy right now. Right? So you’re seeing all kinds of conflicting numbers come in from the CPI to unemployment. numbers and you hear the Fed talking, they’re talking about a pivot, you’re hearing the Treasury, you’re talking. The most important thing is to understand that we are in a battle right now. We’re witnessing a battle between the Treasury and really it’s the US government’s Congress and the Fed. Right. So we had inflate, we had inflation was created by the expansion of money supply. And you know, and there was, as, as you know, that there were supply chain issues during the 2020 year and Pandemic lockdowns. But that inflation was sought to be battled by the Fed, the Fed has two mandates, they have the mandate of stable prices, which is really just that 2% inflation, we can come back to that. And then they have the mandate of full employment, but they raised rates exponentially in terms against zero interest rate policy, when we were at zero interest rates, they raise them up to over 5%, five and a half percent at the top end. So that’s supposed to have contracting kind of influence on the economy. It’s supposed to, it’s supposed to make the economy contract it disincentivize late loans and for borrowing and, and that’s the natural state. Meanwhile, up in Congress, where’s like you said, we’re, we’re spending like drunken sailors, it is just out of control how much we’re spending to give people an idea, we have a 2 trillion plus deficit run rate right now this year. And we are not in a recession. This is unheard of we are literally spending like we there’s no tomorrow is just is pouring liquidity into the markets, part of that liquidity is coming in, in the form of all the interest on our debt. We’ve got 34 and a half $34.6 trillion of debt that we have now on the books, and we’re paying over one, it’s like $1.1 trillion a year on interest just on that. So that goes into the economy, then you’ve got things like the, you know, the the inflation Reduction Act, which is it spends money on infrastructure, and green energy and green projects, and that pours money into the economy. And so you’re seeing in the economy, you kind of two economies in America, right? So you, we witness some recessions and some contraction, so you’re seeing layoffs, 200,000 plus jobs in the last this year alone. And then on the flip side, you’re seeing some expansion, and you’re seeing the interest of the of the inflation rate just kind of stuck at 3%. Why is it stuck there? Well, you’ve got some expansion in areas, because of the all the spending and the additional liquidity coming into the market, versus the contraction of like, commercial real estate, for instance, office real estate, we’re seeing a major problem there. Well, it’s very sensitive to higher rates. So that makes sense. So you’ve got these two things at play. And so what we’re what I’m watching really carefully is the bond market, and for clues in the bond market, what’s going on, because people understand inherently, even if you’re not thinking about it, you just understand that if we’re running these deficits, if we have this much interest on our on our debt, and we’re expanding on our debt, the only way to manage that is with more inflation. So you’re looking for things that will do well with inflation. And if you should have been owning gold through this period, and that is one of the things I own and you should be owning Bitcoin. We can talk about more about Bitcoin as an investment in a second. But what I wouldn’t be doing is I wouldn’t be owning long bonds, not unless it’s for a very short trade, what I would be doing is moving my debt exposure all the way up to the near end to two years and, and shorter. Because the only way around this is for higher inflation, which means ultimately higher rates and the longer and more debt that’s going to be issued, and you’re going to have bond investors demanding rate premiums at the longer end in order to to be compensated for that. And that’s just reality. So,

Anthony Scaramucci 14:34
one of the things that I think troubles me the most and this is a dereliction of duty on my generation and you’re a few years younger than me, but I think we’re contemporaries is we’re stealing from the future generation. And so basically our politicians have said, Okay, young people don’t vote. Old people vote. We’re going to give old people benefits in the form of Social Security and Medicare other types of benefits, and we’re gonna take them effectively from a younger generation of people. And oh, by the way, inflation is a form of regressive taxation because it hits the poor harder than everybody else, because the poor don’t own assets. You and I both know that James, and then the secondary thing I want you to react to, is, while we’re doing this disinflation, the deficit spending that you’re speaking of, is effectively unfunded tax liability. So it has to come somewhere if he does come through the invisible taxation known as inflation, or we’re eventually going to have faff of reckoning and some type of measure to increase taxation, like honest taxation, or reduce spending. So what’s a use a, or are we just gonna look, Rusty? You know, we’re 30 years from now and our fiat currencies effectively worthless? And

James Lavish 16:01
that’s a great question. And this is the point of, of, you know, exactly, we’re talking about with the debt. So what can you do we have 30, we’ve on we’re approaching $35 trillion of debt. And, and so what can the politicians do? Well, they have a few choices, you can have austerity, which is to cut spending, which you spent a few days in Washington long enough to understand that they’ll never do that. Neither party will ever cut spending, because it’s political suicide, they have to take care of the constituents. And they will keep spending in order to do that, each side tries to trick the other side to do it, you see come up with the debt ceiling crisis, every few years, but the debt ceiling keeps getting raised. We don’t even have one right now. That’s how absurd it is. It’s just kind of put on pause, then. So that’s not going to happen. The second thing you could do is raise taxes. So people clamor about raising taxes, raise taxes on the rich raise tax on companies make people pay their fair share. But the reality is, when you raise taxes, you end up limiting productivity, you disincentivize re investment in the companies into research and development into expanding product lines into profitable product lines, to where they they could actually hire people. And so it winds up hurting the economy, because you’re going to get, you’re gonna have higher taxes and lower productivity. So you wind up in the same spot. But it’s actually worse because your productivity is declining. So it ends up being being worse in the long run. So you don’t want to do that. The third thing you can do is just issue more debt, which is what we’re watching happen right now, you know, so that the the Treasury today is, this week, they’re going to be issuing over 200 $205 billion in T bills and another 180 $183 billion in notes, and two year, five year seven year notes, which N auctions happening right now, it’s gonna be interesting to see what happens there. But why are they doing this? Because they can’t pay for the maturing debt. They’ve got to issue more debt to pay for the maturing debt. Okay, so that’s the solution? Well, at the at the same time, they have to allow for high structural perpetual inflation, like the inflation has to continue. Why is that? Because you need high inflation, to create higher nominal GDP GDP and greater dollars, even though the dollars are worth less, there’s more of them around, they’re printing more dollars, and they’re creating inflation in order to have that debt that they’re paying down. They’re going to use cheaper dollars to do that in the future, because the dollars are not worth as much. So when you buy a 30 year bond, and you’re getting 5% on that you’re probably not making out. Because if you look in inflation, it’s really closer to the expansion of the money supply. Anthony, you know, so and that’s been over 7% Since the 70s. And so you’re losing out on purchasing power on those on those bonds, then, so I gotta, I gotta

Anthony Scaramucci 19:14
cut rates though. No, no, I’m the central banking chair. Now, I heard everything you just said, you’re in the meeting with me. We’re having an honest moment. You and I, you’re on my board at the Federal Reserve. And I look to you and say, Yeah, everything you just said is true. But I still have to cut rates, I have to take some pressure off of the Congress because they’re not going to stop spending. And so I’ve got to figure out a way to slow down the interest rate train here. Yeah, and that’s showing me am I really, am I gonna cut rates by the end of the year? You’re

James Lavish 19:46
gonna you’re gonna allow for exacerbating inflation. I do think that they’re going to cut rates but because what we talked about before you’re seeing two economies and something will happen between now and the end of the year. Whether the commercial real estate A problem burns out of control. And they’re trying, they’re working really hard on it, the Fed is working with these with these, the regional banks to make sure they’re shored up, and that they don’t get into a major problem, there’s not a black hole there somewhere, but you’re seeing office buildings sell, you know, for 2030 cents of the dollar from just a few years ago. And that’s, that’s a major problem. Those are major hits to those banks, because they’re non recourse loans, that people, the companies that own them, the the investors that own them, just hand back the keys and say, I’ll take a loss on my, my down payment, but you take the rest of it, and it’s an impaired asset. And so those are problems that are creeping up, I do think that we’re running towards, and this is just this, there’s nothing that can stop this, anything, nothing can stop what is happening in Congress, let’s they cut back spending, which we know they won’t do. So Feds gonna have to cut rates sooner or later because of some sort of event likely, or because unemployment does start to tick up, because the government isn’t filling in the rest of those jobs. And so they will cut rates, which will just perpetuate the inflation problem. It’ll come roaring back, in my opinion, it will come roaring back. And so your actionable thing to do now is to hold things, longer term, think past this little cycle here. Because when we printed money, and we can go back, and so people understand where this all comes from, this started in 1987, after Black Monday, you and I were were likely in high school and college, right? I was in high school. And when Black Monday occurred, it was I could see some of my friends. I didn’t come from money, but they did. And they had stock portfolios. And they were explained to me how they suddenly were, you know, way poor today than they were the day before. And who stepped in? You know, Greenspan stepped in and said, Hey, look, don’t worry, we have your back. They didn’t do anything. But they have their back, flash forward, flash forward to 1998. With long term capital management, you likely remember this? Well, I was sitting at a trading desk. And I got a call from somebody who’s another big hedge. I’m at a hedge fund in in Fort Worth. And I got a call from somebody who’s another hedge fund. I don’t want to dox them. But they said, hey, look, do you guys, do you guys prime broker with Goldman, because they’re going under tonight, so you better get your assets out of there? Well, turns out Goldman has an emergency meeting with the New York Fed and engineered rescue for Goldman, because they were gonna go under because of long term capital management and their massive leverage. So that was the first real step here. Right. So you had Greenspan nodded and gave the hint. Then you had the rescue from the New York Fed of Goldman in 1998. And actually occurred, and then you flash forward to 2008. And we have the absolute rescue of all the banks from the government. So the government took on all the bank’s problems. And they printed over $5 trillion over they excuse me, they printed almost a trillion dollars, flash forward then to 2020, where they print over $5 trillion dollars in order to shore up the economy from COVID and lock downs. What do you think is going to happen the next time that we have an event, it’s not going to be less than 5 trillion. We are now running deficits that are massive, we have $30.5 trillion dollars $34.6 trillion of debt. So when the next event happens, as we both know, that when you when you have an event, and you have a steep drawdown in the economy, what happens is your expenses, your your government expenses go up, I tended to eight to 12%. Typically, because of entitlements, unemployment and all that, then your your tax receipts go down by eight to 12% stock market crashes, you’re not getting capital gains taxes, people are making less money out of jobs. And so your your your revenues drop. So what do you think we’re going to we can’t have that, that’s we must keep going, we must keep the Treasury market liquid, we must keep going. So if there is an event, they will print so much money, it’s going to be mind boggling. It’s not going to be $5 trillion, it’s going to be 10 1215 $18 trillion, maybe even more who knows how bad the event is. So you want to be holding assets that will be able to protect against that. That is the long term that is the through this cycle and looking past this cycle play. And that’s that’s what I’m recommending.

Anthony Scaramucci 24:44
Okay, so So where is Bitcoin? I think you’ve the reason I’m not interrupting James is that you’re you’re giving a wonderful, macroeconomic rendition of the plate in peril and you’re grounding it in In your investment experience, and you’re grounding it in the trials and tribulations and the pain that you and I have suffered through three decades plus of investing so. So that’s why I think we’re both drawing the same conclusions that we are on digital property, and digital assets. So where are things like, where is Bitcoin? In the next three years?

James Lavish 25:22
Yeah, that’s a great question. And so, I’ve been I’m relatively new to Bitcoin. I mean, I came into it in late 2020, early 2021. And so of course, I was introduced to it by my son, because he’s in college, he’s up at Cornell with a bunch of really smart engineers and computer science scientists and they’re into these digital assets, he’s a dad, you gotta check this thing out, because I had dismissed it, of sitting in this is really important. I was sitting in Wall Street was sitting at a hedge fund, the the one area in Wall Street, where you would be looking at these things, and I just dismissed it outright, you know, it’s a Ponzi scheme, it’s not worth anything has no underlying value, it’s going to collapse gonna go to zero. And so I didn’t pay attention. And so, flash forward to 2021, I started paying attention because of what happened with the money supply, exactly, we were talking about, I thought, wow, this is interesting. Gold really should do, it should have done better than it did. But we also both know that gold is highly manipulated in the derivatives market, there’s just so much paper in that market, it’s difficult to, to, you know, to capture all of that, anyway. So where is Bitcoin? I was an institutional investor, I dismissed it, just like most institutional investors have all along the way. So Bitcoin is an is an asset. And right now it is, I would put it in the category, and I would put it in the category of it should be considered a risk off asset. And it’s anti inflationary, it’s a perfect place to just store value for a long period of time, super easy to do. It’s decentralized. It’s not overseen by one central authority or central bank. It can’t just be expanded. It’s super resilient. It’s it’s the hardest money it’s ever been created. And it’s digital. And so that’s where it should be. But the problem is, it’s not understood yet. There’s so much misinformation out there about Bitcoin mining about the energy use about all the other coins and how they’re that there could be another Bitcoin that just created. And that’s all nonsense. And so what it takes Anthony, and I’m sure it took you a while to get to this point is it takes some deep mental work, it takes some critical thinking to get there. No. Yeah. So you have to critically think but how do you do that? When you’re not incentivized to? So up until now, all the way up until the second week of January, your institutional investors when they were not being paid to critically think about this, they could just dismiss it. Why? Because no, no other institutional investors owned it, because it’s too difficult to own them for your listeners. And for the people watching this to understand coming from institutional investing. It is, it was exceedingly difficult to own Bitcoin prior to this year, if you were an institutional investor, if you even if you understood it, if you’re an analyst, you convince your portfolio manager Portfolio Manager understands that he’s sitting there at, you know, the Cleveland firefighters pension fund. And he’s thinking, Yeah, but how do I, how do I buy it? Is it on it? Is it on a regulated exchange? And then who’s overseeing that? And then, where does it get settled? Do I settle it with my bank? What’s this Coinbase thing? I mean, I don’t know if I trust that thing. And do we were to who’s going to custody it? What do you mean, I have to have a key phrase, do I have to do? Am I going to take this home, we’re going to put it in a safe here, we’re going to put it in a safe deposit box. What if I, what if I somehow die? Or I quit my job? Or who how, where’s the succession of this knowledge? And how does that get worked out? And then what are the tax implications of it? And so it was just so it was so difficult to get past all those questions, even if you got past it. On the portfolio management side, you have to talk to the Compliance Committee, and the and the, you know, your internal counsel, your general counsel and get it approved and have all the checks and balances in it. This would take six 912 months just to get to that point. And at that point, you know, even if you’ve got it all the way through, you still are staring at the problem of holding your own keys or finding some sort of custodian that will do that for you. That is not a JP Morgan. That is not a Merrill Lynch or Goldman Sachs you know you had to get outside your comfort zone. Go to Fidelity or something. And it was, it was a huge hurdle flat and then then you go to today. And in January, we get the approval of these ETFs. And in one fell swoop just like that, you know, where their chain where the exchange say they’re trading, when it’s going to be mark, like before you even know you’re going to market in London time, New York time like midnight, where do we market now it’s gonna be marked at New York, New York close trade on New York Stock Exchange, or NASDAQ. You you’re buying it and settling it with the same prime broker and traders on these regulated exchanges. You’ve got the same custodian through your prime broker, you know exactly what the settlement DTC is just like buying in any other stock, the only question is, are you going to get a margin on it. And that’s worked out with each year prime brokers. But that’s it, it’s so easy now. So now you’re seeing institutions start to dip their toe in. And that’s why the price has been stabilized from 30,000, all the way up to 60,000. Here, it’s kind of stabilized here, even though it is still considered a risk on asset, it’s starting to be considered an asset that you should have in your portfolios. So the career risk of owning it has flipped to the career and personal risk of ignoring it. And so that’s where we are now. And it’s taking time. But that’s we’re at the beginning stages of understanding it as a separate asset on Wall Street.

Anthony Scaramucci 31:28
Alright, so So sit tight. I’m going to I’m going to bring in your message I mean, is to sit tight for investors be patient. That’s my that’s my my sit tight. Let’s go to questions. Okay. We have got questions from the outside audience. What’s going on with the debt box case? And what impact could this have on crypto going forward? This is chest from Las Vegas,

James Lavish 31:53
the debt box case? I’m not sure what he’s talking about. Yeah.

Anthony Scaramucci 31:55
So I’m not I’m not 100%? sure what that is. I’m going to have our control room, look up what the debt box case is. And then we’ll return to that question. Let’s go to the next question. What is your take on junk fees? And should they be eliminated? While it seems good for the consumer? Could this have a bigger economic impact from losses on the corporate side?

James Lavish 32:20
I mean, the problem is, they’re all doing it, right. So if you if you had some sort of, of limit, or some sort of, of law on these, I don’t think it would be a bad thing. But the reality is, you we just need we need true competition. That’s what we really need. It’s not the laws, and then we need the we need the ability to have true competitions. So if you if you have banks that are open, that are able to sustain themselves without these kinds of fees, and credit card companies and whatever, that will be a way for investors to move away, because you’ve seen it in the big banks. The fact that these banks still have deposits anywhere just blows my mind. I was talking to somebody who’s in. She’s in her late 70s. And she’s sitting on a little nest egg and she’s got it sitting in a savings account at the bank. I asked her well, what is your what’s the interest rate you’re getting on that point? Zero 1%, we had to look it up because she didn’t know like, well, you need to move that into a money market account, you move it over to Fidelity, move it somewhere else move to someplace where you can actually get get some interest on that. So to answer your question, that’s a way that consumers can can can battle this is by doing business with companies that don’t have those fees. And that’s really the the big crux there. That’s what we need is the ability to open up and allow some companies that are not they’re not depending on those junk fees to make their profits.

Anthony Scaramucci 33:59
They were very well said let’s go back to the debt box case, because I I didn’t recognize that term debt box. But, James, this is related to the two SEC lawyers signed after the judge blasted them for the abuse of power. And so yeah, I’ll start and I’ll get your opinion. I think the SEC this tenure for the SEC. If you were an economic historian, and you were looking back 25 or 50 years from today, you’d be looking at the situation and saying, What a nightmare. The Gary Gensler SCC ultimately was, rather than focus on what was right or wrong for the economy. He got very, very political. Maybe he thought he was going to be the Secretary of Treasury, or something like that. And so he did things in a very manipulative way to the point where he was rebuked by the court system and so the corruption of somebody like Gary get cancelled the political Well, corruption and personal political ambition, I think has foreshadowed the SEC for his tenure. And I think he’ll go down as one of the worst commissioners in the history of the SEC. I’ll turn it over to you.

James Lavish 35:15
I think I don’t have much to add there. I agree. And all I saw was, and I was in meetings most of yesterday. So all I saw was it, it sounded like these attorneys were just the people inside the SEC, were saying they would just shut they would just shut down any questions from the it’s especially from the companies that were looking to push forward in an ETF and the Bitcoin ETF, they were just, they just plug their ears and yelled loudly and shut it down. And so it’s clear that there was just obstruction there. And so I don’t really have much more to add than that. I’ll have to dig into it in this week, and see and see what exactly happened there.

Anthony Scaramucci 35:59
Okay, let’s go to the next question. BRICS is considering the development of a stable coin to facilitate global trade settlements. What’s your take? This is Mark from San Francisco.

James Lavish 36:11
Yeah, so BRICS is an interesting thing I’ve written about this. So I have a, I don’t know if you know the same thing. I have a newsletter I write every week that simplifies financial topics. And so it’s free. But the the thing about BRICS is it’s interesting, but really what it is, it’s it’s the significance of bricks and just forget about the stablecoin. Right now, the significance of bricks is that it’s a signal to not to America, and in particular, that you have countries that are seeking to not replace the US Dollar as global reserve currency, but just to get out from under it. So they want to be able to do they want to be able to settle trades, and settle cross border payments without the US dollar the US Treasury involved. Why is that? Well, we made a tactical error, in my opinion, severe tactical error back when Russia invaded Ukraine, and we shut off and seize their their treasury assets, we shut them off with Swift, then so what that signaled to the world is that if you are not one of our close allies, and you are and you do something we don’t like, we can we can seize your assets and shut off your money. Well, that only serves to make these countries seek to have a way to do trade without having to touch the dollar. And so what we have seen is we’ve seen a lot of these countries that are not buying US US Treasuries aggressively anymore, China in particular, and they’re instead seeking to buy gold, physical gold, and do and make cross border transactions outside of the Treasury by either doing one or gold or something else. So that’s really the significance of BRICS. And as far as the development of stable coin, and to do all that, that that could be an internal thing for them to do that. stablecoin does not, that does not own treasuries. But that’s a for me, that is a, it’s a low likelihood of, of, of, of success in the next few years is going to that would take a long time for them to be able to get together, and all of those leaders and dictators to agree on something that they can they can all trust, that’s going to be difficult.

Anthony Scaramucci 38:50
Go to the next question, I think it’s well said, Do you think the residential real estate market is tied too much to fiat currency and inflation? And is Bitcoin a better long term more stable strategy cat camera from Dallas?

James Lavish 39:03
Yeah, that’s a good, that’s another look, real estate to me has to have a strong function. And if you’re, if you’re an owner of real estate, you’re, you’re, you’re leasing it out. But if you buy a house, and you’re living in it, that’s got strong function for you. It’s, it makes it it creates a life for you and a and a lifestyle for you. So is it tied too much to fiat inflation? Yeah, I mean, everybody talks about how their how their house is going up in value, but in reality, it’s really just the dollars going down in value versus it. It’s a good, it is a good long term store of value, but it’s super illiquid. So the question really is, what do you want to do with your money? Do you want to invest it in something that will give you a lifestyle and function or do you need access to that capital? Quickly? And Do you can you? Can you weather storms over the next three, five years and be able to hold Bitcoin? Not? I would not say take all of your money and put it in Bitcoin if you might need it in two weeks. But if you’re not going to need it for years, then you can put a portion of your net worth in Bitcoin and feel comfortable with it, in my opinion. And so it is a it is a good long term strategy to battle against inflation.

Anthony Scaramucci 40:32
I think the only thing I would add to that Cameron is the I think James and I share the view that a bitcoin is digital gold, and gold has a $16 trillion market cap. And Bitcoin has a $1.5 trillion market cap, it will reach the market capitalization of gold. And so there are a few times that we’ve seen this sort of thing happen. Amazon is one of them. When we looked at Amazon and said, Okay, that’s going to exponentially scale. And it will end up be coming one of the largest retailers in the in the country, despite whatever the near term volatility was, if you just held the position, you did very well. Same thing with a Facebook or same thing with a Google. And you know, we just think that Bitcoin is going to be a store of value digital gold, therefore should trade comparable to the size and scale of an asset class as opposed to an individual stock, which is where it’s trading right now. Let’s go to the next question. Where are your Mickey ears? And do you not wear them since you’ll ruin your hair? These are these guys are breaking my balls because I’m here. I mean, just show everybody what’s going on out here. Okay. That’s the Caribbean Beach Resort. I’m staying at the Riviera. And life is pretty good here in Disney World. But it’s better on the wealthy on network. With speak up. And James, you’ve been a terrific guest. I hope I can get you to come back. I appreciate the time that you’ve shared with us. Any last thoughts before I say goodbye to you for the weekend? No,

James Lavish 42:10
it’s It’s been a pleasure to be here and to talk with you and I look forward to come back again.

Anthony Scaramucci 42:16
All right, well, this is a speak up with Anthony Scaramucci signing off from the land of Mickey and I am wearing this headset which is not great for my hair. I promise you I’ll be fixing my hair as soon as the show’s over. Thanks again for joining us. I’d see


The information, opinions, and insights expressed by our guests do not necessarily reflect the views of Wealthion. They are intended to provide a diverse perspective on the economy, investing, and other relevant topics to enrich your understanding of these complex fields.

While we value and appreciate the insights shared by our esteemed guests, they are to be viewed as personal opinions and not as official investment advice or recommendations from Wealthion. These opinions should not replace your own due diligence or the advice of a professional financial advisor.

We strongly encourage all of our audience members to seek out the guidance of a financial advisor who can provide advice based on your individual circumstances and financial goals. Wealthion has a distinguished network of advisors who are available to guide you on your financial journey. However, should you choose to seek guidance elsewhere, we respect and support your decision to do so.

The world of finance and investment is intricate and diverse. It’s our mission at Wealthion to provide you with a variety of insights and perspectives to help you navigate it more effectively. We thank you for your understanding and your trust.

Put these insights into action.

This is why we created Wealthion. To bring you the insights of some of the world’s experienced wealth advisors and then connect you with like-minded, independent financial professionals who will create and manage an investment plan custom-tailored to you. We only recommend products or services that we believe will add value to our audience.  Some links on our website are affiliate links. This means that if you click on them and use the affiliate’s services, we may receive a payment from the vendor at no additional cost to you. 

Schedule a free portfolio evaluation now.