Global Liquidity Just Bottomed — Mel Mattison Says Bitcoin Will Rip Next

Jackson Mikalic (00:01.906) All right, we're back. It's the last trade. We got an electric episode for you this week. I'm not just saying that as well. We got Mel Madison on the last trade. Mel's also wearing green. We did not coordinate this, I can't help but notice all of us got some green on for today's episode of the last trade. Mel is a writer, investor, founder, and fintech executive. And maybe you've come across him on accident. If you haven't already, you should definitely follow him there and check out his book, Quaza. Brian was a just fawning over this genre that Mel has published. Brian Cubellis (00:35.346) untapped, the untapped genre of crypto, finance, sci-fi, dystopia. There's a lot there. Jackson Mikalic (00:41.664) Yeah, so next episode we already decided Mel's gonna come back on the show. At some point next year we'll talk about the book. But Mel, great to see you. How are you doing today? @MelMattison1 (00:50.958) doing great and really appreciate you guys having me and looking forward to our conversation. think it's an interesting time to be on. Some things are at some critical points as we speak. Michael Tanguma (01:03.17) Yeah, you've had some prescient calls this past year, Mel, but maybe before, I was a little late to the pre-start. This genre is new to me. Can somebody just fill me in on the type of genre? Do we save that for the end of the episode? Jackson Mikalic (01:18.058) Yeah, now tell us. @MelMattison1 (01:18.064) Well, mean, Brian, you could add to it, but if I was going to talk about the genre of quads, it's a financial thriller. And it's just kind of like, you know, this future world is where it's set, where the markets are kind of being run by algorithms and the merger of AI and quantum computing. And behind the scenes, there's essentially nefarious central bankers who are working to put into place a more neutral reserve asset backed system around gold and silver through the blockchain. So it's basically a little bit of a prescient thing because we're seeing a lot of what I kind of talked about when I started writing this in 2022 and it got published a year or so ago, come to fruition. I talked about like, Oh, well, gold probably needs to go to 25,000 in the book to start to back things and different stuff. And I think we're seeing that stuff start to take place. And that was the reason I wanted to write it. I wanted to create an interesting thriller, but I also wanted to talk about in a fictional way, what I saw happening in the real world. And so that's what I attempted to do with Quas. Michael Tanguma (02:31.829) I love it, sounds like manuals meets sci-fi, which is the piece manuals is missing, anything related to technology, at least as far as I've gotten. So, that's very cool, excited to take a look. Jackson Mikalic (02:43.114) Well Mel, you know what? People are bearish these days. know, sentiment, at least what I see on my algo on X, you're one of the few people who still have a bullish outlook. And so I was excited for this episode because A, you've been very highly requested as a guest and I've been following your work for the better part of this year and I've enjoyed it and gotten a lot of value out of it. And to Michael's point, you've been right about a lot of things. And I know the bears are also worried that we're having this conversation. The people who are bearish in our comments didn't want you to come on the show. So we're going to have to give them hell. And I would love to just start. One thing I think of is, and you've talked about this before, is over the past five years, post-COVID, we've seen so much liquidity enter the system. There's just been the coordination of fiscal and monetary policy and I can't help but notice how many people have been bearish over the past five years and have called for all sorts of market crashes and corrections. Yet things continue to rip higher. We're still setting new all-time highs across the board in all sorts of asset classes. So why the disconnect? Why is that happening? @MelMattison1 (03:53.969) Yeah. Well, you know, when Shakespeare wrote his plays like Romeo and Juliet, like it actually starts off with a couple of paragraphs where he basically tells the whole story and then the story develops. So I just, I just want to say right off the bat, I literally think as we're recording on Thursday at 1pm Eastern time, like this is one of the best times to buy Bitcoin, probably the best time since April. We're right now hovering below a hundred thousand. And I totally anticipate a 50 % plus move in the next four to six months. Like, I think that is going to happen. Do I think it necessarily happens next week? Do I think that we could not bump along for another two, three, four weeks, and then all of a sudden take off like a rocket ship? Absolutely. But I just want to just set the base right from the beginning. Like this is my view. And I think. The time when everybody is on X telling you buy 0.1 Bitcoin and you're going to retire in luxury. That's when you sell the time when everyone on X is telling you, this is the worst thing. Bitcoin is over. The story is done. This is when you buy. And if you go back and you look at a multi-year chart of Bitcoin, it basically is right at the bottom of a key channel. And it's just bouncing along there and it's hit this channel like three, four times in the last two or three years. Two of those three times, basically what it did was it hit the channel. It bounced up a couple of weeks later. It came back. hit the channel again. And it took almost a month to really start to move up. And I think we hit the bottom of this channel like a week or two ago, which means we have another week or two to go. Where we could just be bouncing around what I would call between 95 and 105, you know, one or two weeks. And then I think it could really go. And I think a lot of times people are looking at this and they're thinking, my gosh, you know, we are literally going to hit December in a couple of weeks. Last December, we were around a hundred thousand. And, and if we don't change from here, @MelMattison1 (06:05.574) It's going to be one full year and the 12 month return on Bitcoin is going to be zero. That's going to be like back up the truck time. Right? Right. I mean, if you've literally got a year where Bitcoin does nothing, like that's when you want to buy, you don't want to buy when it's up 25 % in the last two months. And so many people, whether you look at Google searches or whatever, they're like into crypto and financial advisors. They're thinking, the time to get into Bitcoin is like, this, this is all these tailwinds and this is going great and everything. So I just wanted to set that stage of where my mindset is, is that we're in a trough period. And the last time we had one of these was in April and it was an excellent time. And we've had other ones in the last few years. And I just think, yeah, do I, are we going to be at 140 next month? Maybe. But. What I do feel confident is, is that we're going to be between 125 and 150 within the next three to four months. And so what I would say is have me back on in three months. Let's call it February. And if Bitcoin's not between 125 and 150, which is a 25 to 50 % up move from here, then, you know, call me wrong. So let me get back to your question. Um, you know, I think a lot of the. the markets right now, what they're doing is they're really digesting, um, a lot of liquidity dislocation, if you want to call it that. So a lot of people have been talking about the standard repo facility, SRF, uh, so for rates spiking, um, I like to be more simple. I like to keep things simple. And I had just posted something on X at Mel Madison one, like keep it simple. Like in September, we had a monthly treasury statement and it showed $180 billion or so government surplus, meaning we actually took in in September a bunch more money than we put out. Now this is an accounting identity. Fiscal surpluses equal private sector deficits. Fiscal deficits equal private sector surpluses. @MelMattison1 (08:25.082) So if we're running a fiscal sector surplus, we're going to have a private sector deficit. And what I believe Bitcoin is the best asset in the world at is sniffing out liquidity. And we had huge liquidity. Not only did we run a surplus, a fiscal surplus in September, but then we shut the government down in October. So what my point was on an X is this is the driest period I have seen in years. for fiscal liquidity into the system. And that had we not established the SRF, the facility to essentially, know, backstop the repo market post Silicon Valley is that we would have probably had a crisis, but the Federal Reserve was able to come in, provide the quiddity, backstop a crisis, and we're bumping along. And in one or two weeks, I think, because it does take a little time for things to move through the system. Once all the government checks start going out, once everything comes back in, we're going to have a flush of liquidity and that's going to move financial assets up and the best asset for that is Bitcoin. So that's basically my fundamental thesis of where Bitcoin's at. It's been struggling in last two months because of the sucking sound of fiscal surpluses, government shutdowns. That's going to flip and we're going to start to see the reverse happen. Brian Cubellis (09:52.495) That's all very well said. I was just gonna put maybe a finer point on a couple things and I wanna get your thoughts on the other variables in my mind because I think there's a few things going on. The first is a lot of market participants, people who already own Bitcoin are still anchoring to the four-year cycle thinking. And I would say that that's just ill-advised given the onset of ETFs and a different market structure, a different cohort of... Michael Tanguma (09:52.932) melt Brian Cubellis (10:19.9) people bidding Bitcoin effectively, whole new cohorts of demand that I think people aren't recognizing that, you know, for on one hand, you know, the having just has less of an impact over time. But two, it's really an artifact of just people's cyclical thinking that, you know, what was true is going to continue to be true in the future. And then the other component too is everything you just described from a liquidity perspective, I think is spot on. But if we zoom out, like the liquidity picture is very different than other sort of ends of cycles, if you will. So like historically, Bitcoin four-year cycles have lined up somewhat with liquidity cycles, the business cycle. And I think this is the first time where those things are actually moving in opposite directions, i.e. the last sort of Bitcoin top four years ago, we were entering the fastest tightening cycle on record. And now we're cutting rates. And as you mentioned, liquidity is headed in the other direction. So... How do you square those two factors, the anchoring bias to these four-year cycles and then just a different liquidity picture in the context of that timing? @MelMattison1 (11:26.916) I mean, the liquidity picture is totally different. In fact, the PBOC, the People's Bank of China now has a larger balance sheet than the Federal Reserve. So like wrap that around your head, right? Like, we've done so much QT. It's ridiculous. The fact that Bitcoin and the markets have done what they have done. So post COVID, we approached $9 trillion on Federal Reserve balance sheet. We're now at around six. That's a $3 trillion reduction in the balance sheet. People have talked about, China is going to sell their treasuries. That's going to collapse. know, China has never owned much more in. own a lot less than a trillion dollars right now. Like what has happened in the last year or two is greater than if China and Japan together decided to sell all of their treasuries in the market by the federal reserve. And guess what they announced last meeting. They're done. Not only are they done, they're going to start buying. So this is huge. This is the bottom of the liquidity cycle right now, like two day, like with the government, like shut down ending last night and when Trump signed the bill at 10 PM. And then we have literally the federal reserve saying December 1st, they're ending QT. Then they've also admitted that they want to keep up with expansion of the balance sheet. more or less in line with nominal GDP growth. We have gone from like a massive decline. And then you also have the PBOC, the People's Bank of China, continuing to increase their balance sheet. And they're now slightly above the Federal Reserve as far as assets. So we've got central banks that are just sucking up bonds, gold, dollars, everything. this is actually what has to happen. because of the situation that the world is in, which is essentially a sovereign debt crisis. And this is the backstop. This is the story. This is the big narrative between gold and Bitcoin and things can fluctuate and everything else can change and there can be high points and low points. But the big story that's not changing is that sovereign governments are in over their heads. They're simply in over their heads and there's no way to get out of it other than for the central banks. @MelMattison1 (13:54.705) to begin to absorb this. Then what do you do? Okay. What is inflation? Milton Friedman said inflation is always and everywhere a monetary phenomenon, more or less defined inflation is when you have the same amount of money chasing a greater amount of goods. How do you alleviate inflation other than, you know, balance sheet triage? I'll give you an example of how you alleviate inflation. You give money a place to go that doesn't impact the real economy. Where can money go that doesn't impact the real economy, gold and Bitcoin. That is that these are the advantage. This is what gold and Bitcoin are. They're sponges. They're sponges for the monetary liquidity that has to be injected into the system over the coming years in order to keep the sovereign balance sheets from collapsing. And the only way you do that is you put into the stock market, you put into housing, you put into Bitcoin, you put into gold. We've got housing in a trouble market. They're going to declare a housing emergency next year. They're talking about 50 year mortgages. They're going to do a bunch of stuff. We've got the stock market. Valuations are getting very high, but where can you put liquidity that has no cap? It's gold and Bitcoin. And that's where I think it's going to continue to go. Even though in the short term, it might look like that narrative falls apart. I think that's actually just. fluctuations and I honestly believe that the, the, the fact that we ran an almost $200 billion surplus last month, then we closed the government that put a huge strain on things and that the liquidity gates are starting to get open and that's going to send, you know, Bitcoin off to the races. And I think gold's been sniffing it out too. And that's why it's gone up a couple hundred bucks in the last two days. Michael Tanguma (15:46.574) It's really well put Mel. Maybe to go just a little bit further on that in the sense of what you articulated Luke Grumman does very well as well when it comes to oil trading pairs with gold and how different economies naturally need that to offset any kind of dollar inflation because a lot of these countries are holding fiat or treasury. How do you see Bitcoin playing into that in the United States in particular, because I think it's well understood that at least in the East, gold is playing a big role strategically from individuals all the way to the sovereigns. Do you see on the horizon where the US government is thinking about Bitcoin in that lens as a potential wild card, or is it still too early in your mind? @MelMattison1 (16:30.576) Well, I think it's in a way it's a little bit of the enemy of the enemy is my friend. And I think that what China has been doing is been absorbing gold. in my book quads, actually the beginning of it is it's kind of ridiculous because China declares like they have 2,900 tons of gold, which is ridiculous. So the United States is according to Official figures, the largest holder of gold in the world, over 8,000 metric tons, which more equates more or less equates to 260 million ounces. Okay. So if you look at like Germany has high amounts, different things, I mentioned these things in the, the beginning of cost China supposedly has like 2300 metric tons of gold. It's absolutely ridiculous. Number one, I pointed out in the beginning of cause that China has actually overtaken. South Africa as the world's largest producer of gold. They do not allow gold to be exported. And then they have this Shanghai exchange, which just funnels gold into the system. And that a lot of people that are kind of like gold bug conspiracy theory guys, they think that China actually holds over 30,000 tons of gold compared to our 8,000. Okay. And then if you actually look at India, which is part of the BRICS consortium, Although the Indian government, I don't think has a huge, huge amount. They have a large amount. India, main way of preserving wealth on the subcontinent has been gold and silver for centuries. And if you add the personal holdings of gold and silver in India, you also get close to 30,000 metric tons. So China and India hold gold and silver. So wouldn't it make sense for them to want gold and silver to be the basis of a system? And a lot of people say, well, no, why would they want it to be the basis of a system? Because the United States has 8,000 metric tons and we're the biggest holder. No, we're not. China and India have much more gold as nations than we do in the United States. That's why they want gold to be the new basis of the system. So they're working to create gold as the basis of the system. Bitcoin offers a counterbalance to say, yes. @MelMattison1 (18:52.134) Gold does offer that it's a neutral reserve asset. This is what Keynes talked about in 1944 when Bretton Woods started off and he created and talked about what he called the bank core, which was we need to figure out a way for nations to trade. Luke Groman, who you mentioned, he talks about you want to even out China's trade surplus with the rest of the world, just make gold $25,000 announced. Bam. It's even. their gold. This is the thing that a lot of people like me who have been holders of gold and silver for decades have always realized that this 1971 post Bretton Woods fiat world was always destined to be a flash in the pan. It was never going to work because you cannot have just one nation say, we can print money and everybody takes it and we're going to do it. Like eventually people are going to wise up. It worked for a while. It worked during the unipolar moment. It, it made sense. It, you know, it had its time, but it was, it will be looked at in economic history as a flash in the pan of like, wow, there was actually like a 40, 50 year period where money wasn't backed by anything real. And people are going to come back and say, money has to be backed by something real. Cause if it's not, then politicians can just decide willy nilly, whatever. money is worth, they can devalue, they can do whatever. And that's not going to work in an international system, which is ruthless, cutthroat. As John Mearsheimer says, an, you know, a, it's, it's, it's anarchy. There's nobody in control. Like you need to have something physical, something limited to control it. And Bitcoin being digitally limited or gold being physically limited, they can serve that function. And eventually they're going to come back to the center of the system and it's going to be a gold Bitcoin based monetary system because a Fiat based system is like on its face doomed for failure. just simply is. And we're seeing it play out. Michael Tanguma (21:02.645) Yeah, thanks for running through that. And I think that's honestly probably the most fascinating for me. And I'm sure you feel it. I know we as a group that this is a structural change. And most of TradFi, most of Wall Street and most of mainstream finance believes that this is just a trade and they can't fundamentally see that the existing system can no longer is no longer sustainable. And so I think more as this narrative goes about, it's interesting to see how it'll play out, but it's just very still early innings and the market being educated that this is fundamentally unsustainable. @MelMattison1 (21:35.431) And it's happening and you're seeing it happen. I it's not like it's, you know, oh, well, we're theorizing about this and maybe it happens. mean, I mean, gold was $2,000 an ounce to two and a half years ago and it's over 4,000 today. Um, I'm actually shocked of the rebound we've had just off of 4,000. I thought it might go down to 3,800 or something. It's not even taking a break and it could still break down. I mean, it's tough to call like weekly moves on things, but what we're seeing is that the market participants are recognizing this. so it was a year, two years ago. You know, I, when I first started talking on podcasts, I was talking about all the same stuff. Never would hear even a whisper about it. I was listening to Bloomberg surveillance this morning. And the guy was basically talking about, you know, debasement trades. I like, like this is now becoming the accepted convention, which actually worries me a little bit, but basically a lot of people in the Bitcoin community, the gold community, saw this happening years and years ago. And now it's really blossoming and now it's being embraced by the Morgan Stanley's of the world is that in, Gromit does a great job of this explaining. Why we can't have recessions, why the stock market backs the treasury market. Why if asset prices go down, you cut down receipts and then that creates a depression slash recession scenario, which then requires more transfer payments from snap benefits and everything else. it be, and so that you get into this situation where the only out is inflation. The only, the only game in town is to continue to debase and the only hope. that this doesn't completely blow up is that you can somehow grow nominal GDP at a high extent. And so that's what Besen is hanging his hat on. That's what, that's what these guys are all in. And Besen was on the new shows this last week. He's like, look, we've had inflation meeting out. We're going to have real wages, but then you throw an AI and you just, you just create this whole hot mess that is absolutely crazy. And so it doesn't surprise me that markets are trying to wrap their heads around all of this, whether it's the AI narrative. @MelMattison1 (23:59.015) you know, Bitcoin debasement narrative, all of this stuff is very confusing, but I think at the end of the day, once the market sorts it out at their core, it is a debasement trade and assets will go up in dollar value. stock market will be up in USD. It will be down compared to gold or Bitcoin. And why, since I first started coming on X a year or two ago, I said, look, the cores of my portfolio are gold and Bitcoin. I also play in the stock market because things rotate. There are different opportunities out there, but gold and Bitcoin are the cores. And Bitcoin's, you know, like I said, I think in a consolidation period, OG selling, there's a bunch of stuff going on. could get into on the details of Bitcoin, but I mean, like medium to long term, six to two, three year term. Like I think Bitcoin's great. What it's going to do in the next week or two, you know, we'll see. Jackson Mikalic (25:03.102) Yeah, it makes a ton of sense and... You hit on some of the things I wanted to ask you about because the topic du jour are just overpriced SaaS companies and AI. It's a bubble. Feels a lot like where we were in the spring with just all the fear around the tariffs and how quickly things reversed there. so and one thing to another signpost noticed was Michael Burry tossing in the towel on the fund as well. And so why do you think Mel so many people are still so many Notable investors and I mean not even notable investors I'd say so much of the financial media Still is having trouble understanding why asset prices continue to climb Right, like I've noticed over past several years people are always calling for a crash But it seems like the crashes to the upside, right? There's a meltup happening and the crash is more so in the value of the underlying currency Why why do you think this is such a hard concept for people to wrap their heads around? @MelMattison1 (26:05.648) Well, I think they fundamentally misunderstand the role that stock markets and Bitcoin and gold play in the world today. I mean, I think they're still living in some delusional world where it's supposed to correspond to price to earnings ratios. Get me a break. Like that, that's not what the stock market does. The stock market is a Ponzi retirement scheme for the United States. That's also a monetary escape valve for inflation. I mean, that's what it does. And it also provides receipts, know, tax receipts on capital gains. That's the role that the stock market plays. That is what it is. If you're sitting there and you're trying to say, Hmm, should the stock market be trading at 25 times? And I'm looking at the Cape ratio and I'm trying to figure this out. I honestly think you're in a different world. Like you don't understand what happened. Okay. When I was a child. My father worked for AT&T. was called Western Electric back then. He worked at the Hawthorne plant in Cicero. I was born in Chicago. Hawthorne plant in Cicero had over a hundred thousand people at it. It had its own hospital. We were in 1975 when I was born, a manufacturing juggernaut. The United States was China. We were like post-World War II, we're 50 % of world of of world GDP, 50%. Okay. Uh, that was in 1945, 30 years later. You know, I was born. don't think we were 50%, but we were still 30, 40 % world GDP. We manufactured everything and we, did everything and, and, and you know what people did? They got jobs. They work for companies like my dad who worked 37 years, uh, for AT&T. became Western electric. Eventually it turned into actually lucent technologies during the.com boom, but Basically 37 years and you know what he got after that he got health care. He got pension. He got everything What happened since then? Nobody gets any of that anymore. Nothing. What do people get they get government benefits entitlements We have 38 trillion dollars in entitlements. How do you pay for those entitlements? You know, I saw an AARP ad it said fight for your Social Security benefits. We earned it bullshit. They didn't earn it @MelMattison1 (28:27.64) Okay. I'm sorry. Boomers did not earn their social security benefits. They did not earn their Medicare benefits. They earned a little bit of their social security benefits a little bit, but actually in the beginning of social security, the social security payout rate was like one and a half percent. They put in like a tiny little bit amount of money and the expected death was like the actuary or tables were like, these people were going to retire at 65. They'll be dead at 78. Now they're like 98. Like they've been collecting benefits for 30 years. Then you look at, and this is my father. was 86 years old, actually just had a heart surgery and he, he was visiting me for my birthday. went out to dinner and I asked him about the heart surgery. How does it go? And I said, how did the surgery go? And then he said, you know, okay. I tell him, should it cost. He said, Mel, you're not going to believe this. was $435,000. And I said, dad, how much did you pay out of pocket? And he said, $212. Okay. This is where all of our money is going. This is where all tax receipts are going. Okay. It's going to pay for heart surgeries for 86 year old men. And they deserve it. I'm not saying that. They should take that away from my dad and that shouldn't happen. But what I'm saying is we've gotten ourselves into this position. Okay. We've gotten ourselves into this position. And this is why one sector I've never recommended all year, even though it's been doing well lately is healthcare. Because I think if the government really wants to attack this problem, they have to attack the healthcare industry. And so regardless of what happens on the charts, I'm not going to buy into healthcare because That is where most of the receipts and all of the government spending is going. And if they're ever going to attack it, you know, they've got to go there, but this is just the way that it works. And so what the stock market does is it provides this opportunity to provide wealth. The wealth gets multiplied, the wealth gets dispersed. Boomers can give money to their children to buy homes. @MelMattison1 (30:48.292) And this creates a K shaped economy. It's very bifurcated. I'm not arguing against that. I'm saying that is what it does, but it perpetuates the system. If you collapse the stock market, you collapse tax receipts, you collapse essentially the world's pension system. Like the world collapses and that's why we haven't had a prolonged and sustained downturn in stocks. And that's why everybody right now is of the opinion, buy the dips. Jackson Mikalic (31:16.436) Yeah. There's so many directions we could go in and go back to one of the original points you made just right there about the price to earnings ratios. One way I think about it too is that people are just going to be willing to pay more for a stock because the currency is being devalued at a more rapid rate. And I think that's just a fundamental thing that people are having to move further out in the risk curve, right? You see that with institutional investors who still many of those pension schemes are still quite underfunded despite having to go into private equity, having to have exposure to real assets because what has worked 30 or 40 years ago no longer works today. And I mean, to your point as well, seeing this in the housing market, which I don't know. mean, my opinion is everything goes up. I don't know. At least where I live in the Philadelphia area, there hasn't been any sort of slowdown at all in housing prices, despite things being so stretched. And I'd be curious just to get your thoughts on, you know, in terms of outlook, how do things continue to rally from here? Just like from a liquidity perspective, from the fiscal and monetary things lining up to your point, like QT ending. And how does that work out in terms of just like the younger generations? I think of like people younger than me, Gen Z, Gen Alpha, you know, they're entering a workforce that is, you know, funny enough that the job numbers for October are just miraculously gone despite October being the most amount of layoffs since 2003. Just, oh, we don't have those numbers anymore, but that's convenient. So what do you think just in terms of your financial background? What kind of advice do you have for younger investors or younger professionals to try to get ahead in a world where the labor market is fundamentally changing, where homes are unaffordable for most, where they're buying into equity prices that are just incredibly high. What are your thoughts there? @MelMattison1 (33:11.398) Yeah. I mean, and, and I don't know, I don't know what's going to happen. I mean, we had the government shut down and the markets aren't doing well today. I like, could we go down 5 %? mean, literally we hit an all time record high on the Dow yesterday at 48,000. We, we got within 1 % of a new all time high in the SV. Like if we go down 4%, like there will be people flipping out. They'll be like, Oh my God. The S and P is down 300 points. It's like, well, we're up like 3000 in the last, you know, since April, like it, I wrote a, on the expose, I had something like talking. said, patients grasshopper, like, I think Bitcoiners need to understand this too. Like this whole idea. And I used to see tweets a few months ago. I don't see them much anymore of own 0.1 Bitcoin and you'll retire in luxury. Like people need to recognize like what the reality of the situation is like, eight, nine, 10 % annual returns are great. There are certain times where you get 15, 20 % returns. I'm working on a little, article, kind of comparing the 1950s to the, to the current situation. A lot of people don't recognize that the 1990s and 1920s were not anywhere close to what happened in the 1950s. Okay. We had over 20 % average annualized total return on the S&P 500 during the entire decade of the 1950s. So you also get a lot of people out there who are like, Oh, people are getting used to 20 % returns. That can't happen for a prolonged period. Bullshit. It happened from 1950 to 1959 every single year. Now there was like an up 45 % year. There was a down year, but if you look at the entire decade of the 1950s, there was a 10 year period. where for the average of that entire 10 year period, the S and P went up over 20%. Okay. So it is possible to have the S and P go up 20 % every year over a 10 year period. Um, when you smooth it all out. I also think that the 1950s are very familiar to what we're going through right now. Um, so in the beginning of the 1950s, there was massive inflation. @MelMattison1 (35:30.278) At one point there was over 21 % annualized inflation. This happened because of massive spending. The World War II price controls came off. We were still massively spending to fight the Korean War 50-52. And in 1951, we hit 21 % annualized inflation. Much higher than in 1980s, much higher than we just hit. So let's... Let's recenter here. Okay. You can have a decade that has high inflation. and then let's look at what else was going on in 1950s. Massive government spending on infrastructure build out, right? That was when we built the Eisenhower U S interstate system. we, we spent a lot of money on that because we needed it. We also built airports. We built roads. We, we basically had the government very involved because what the government recognized. Was that between 40 and 45 and then 50 and 52, which is a Korean war, we were plowing so much money into foreign activities that if we didn't, the government didn't plow money into the economy, it was going to collapse. And so we plowed it in, in the fifties and we had an amazing decade. another thing about the 1950s that I think people completely misunderstand is they think it was a time of like economic equality or things were good. What people don't realize it was like double K-shape bifurcation of what we have now. Um, the poverty line as it is established by the U S census bureau was not in effect during the 1950s. There was an economist, his name was Gordon Fisher. He went back and he looked where, how many Americans live below the poverty line during the 1950s? was 25%. It right now it's 10.2. Okay. So. In the 1950s, a quarter of Americans were basically living in poverty. Why don't you hear about it? Cause they were black, cause they were Hispanic because we were living in a racially segregated society. So we had a permanent underclass, but it was an extremely bifurcated K-shaped economy during the 1950s. Everybody wants to look at happy days. wow. Everybody's doing great. Yeah. All the white people were doing great. @MelMattison1 (37:53.275) But guess what? 25 % of the American population was not. So we're actually less bifurcated. Now, not only that, Eisenhower instigated a huge, guess what? Mass deportation program because after the wars, there were too many immigrants. And I apologize for saying this, but this was the name of the program, Operation Wetback. This was, and people can look it up on Wikipedia. This was the 1950s massive multimillion person mass deportation program during the 1950s called operation wetback, where they basically went out and any foreigners they took out of the country. Okay. So guess what did the, what did the S and P do best decade ever over 20%. Okay. So people that want to say, we've got a bi-fugitive economy. We've got mass deportations. All this stuff, guess what? We had all of that in 1950s and it was the best decade ever. So I'm not saying like, let's go back and operation wetback was a good idea. What I'm saying is that there are a lot of people that are on a very far left political persuasion, whether it's on Bloomberg or different channels, they're looking at this market. keep wanting it to fail. They keep wanting to say, this is going to collapse. And here's why. Terrace are going to explode, cutting down on illegal immigration is going to collapse growth. They, they want to keep putting those points out, but history just doesn't say that. That's right. It says actually the opposite. says, if you look at the most, what I would say best analog period to the 2020s is the 1950s. Huge infrastructure builds, mass deportations. you know, basically there were. Yiel Kruk control was still going on in the 1950s. Price controls. mean, all of that stuff is going on and the S&P went up 20 plus percent on average every single year. Michael Tanguma (39:58.988) I appreciate you sharing that because I never had that contextualized, but it makes sense based on what you said. Like everything is relative and I kind of tend to think of like societies in, you know. like these hundred year periods is in fractals like expanding out when we think about like power influence in the sense of like, you know, 500 to a thousand years ago, what was the debasement level versus it was 500 years or the amount of information or ability, like all the things that we have today. So relative to the past 10 years, specifically in the West and U.S., it looks, there's this like pessimistic view, when you look back at history, the K shape was double what it was today. And @MelMattison1 (40:39.566) No, it is. And I've looked at that. I've looked at what was medieval Europe, like wealth dispersion. I've done like AI searches and research on, and we're tons ahead of it. We're tons ahead of where we were in the fifties. This is actually one of the least K-shaped economies we've ever had. We just had a little bit of an aberrational period in the 1980s and nineties where it wasn't this K-shaped, but relative to most of human history, we're in the least K-shaped economy we have ever had. Michael Tanguma (40:45.163) Yep. Michael Tanguma (41:06.989) Yeah, exactly. Right. And this is something that I've instinctually been like noodling on because we had Zubi on a few weeks ago and we were talking about like relative to the US, this is actually a pretty prosperous time for a lot of different countries and individuals because you're ultimately taking the Internet coupled with AI coupled with you can buy a sliver of Bitcoin, maybe gold in the future, but definitely Bitcoin from a from a smartphone and get access to money that cannot be debased. That was never the case in human history, especially with a bank account. And so The other angle is what you're saying about the fiscal dominance of the US. Well, we can still parlay that into growth to your point. And I think this is something that Gromit also talks about is that we will have a manufacturing boom. The bondholders will get shaken out of their real wealth or real value savings. That's just what has to happen. But we can play that into basically a growth trend in the US moving forward. And I don't think that theme is discussed even on the right side or the people on Twitter. It's all doom and gloom versus there is a real opportunity to get out of this and relative to previous time periods we're in pretty good shape. @MelMattison1 (42:17.966) I think it's all bullshit doom and gloom to be honest with you. Like there's this whole thing about China. Okay. This is one of my biggest, I love Luke Gromit. He is one of the best analyzers of like major macro trends there is out there, but he leans in my opinion, too much towards China. Like he kind of thinks like, look, he's got a great point. Okay. China did create a stranglehold on rare earths. Okay. We're going to address that. We're going to address that. We also have ways to pinch China in the meantime, and people don't want to admit that. like, let me tell you something about China. Like that whole economy, everything is built upon exports. And you know what happens when the U S exports get closed? They start flooding other economies. And you know happens if you flood Europe? Like all of a sudden that shuts down the German economy. And China is going to be shut off. And guess what happens if the whole world says, guess what, China, we don't want all your cheap exports. Then all of sudden these people get put out of jobs. Then guess what happens? Xi Jinping's power gets threatened. So people that want to think that China just has us behind the eight ball and there's nothing we can do about it. And they're just the masters of the universe. They've got this 40 chess, you know, you know, laser focus and, know, no, it's not like that. And you know what people that also want to think the United States is the best rah rah United States we can never defeat it. Guess what they're wrong too. We are in a massive adversarial competition. Just as we were in the 1950s and 1960s with the Soviet union. This is another comparison to the 1950s. lot of people said, deep seek was a Sputnik moment. Well, guess when that happened 1950s. Look, we have been here before, which is the West is in a position. Where there's essentially half of the world that is saying, look, we don't necessarily want to play along to your rules and all this stuff. We've been there before we were there for most of my life. Like I said, in there, the show, was born in 1975. It wasn't until 1990 when we finally like, you know, threw off the Soviet union. I mean, this is what happens. Like this is the way it works. What the United States needs to do is like, just get its act together. @MelMattison1 (44:38.278) And these politicians are not helping themselves to be honest with you, sir. But, but, but but I do think at the end of the day, the foreign, the foreign, uh, establishment, the blob, whatever they're starting to coalesce around a single view. And this is why I've said this before. I don't think it matters if AOC or Vance gets elected in 2028. I think the same things are going to happen. What's going to happen is the United States needs to become more sovereign. We. We need to create our own rare earth minerals. We need to fabricate our own ships. These things that are being put in place right now by the Trump administration, just like the Trump tariffs in 2018, we're not, you know, thrown away with by Biden. These things are not going away. Like, like again, Gromit says it great. He says in 2010, China, basically weaponized rare earths against Japan. Like anybody in the U S should have recognized. We could be weaponized rare earths and magnets and all this stuff. either, we didn't recognize it or we thought they wouldn't do it. I think at this point we're recognizing we need independence and we're going, we're going to get it in the meantime. Could things be choppy? China's got some leverage over us. for certain, for certain. But at the end of the day, like if the world broke into two systems. A brick system and a United States Western led system. I don't think that's necessarily a bad thing. I grew up in a world where there were two systems, USSR and the Soviet system and the, and a Western. And guess what? Everybody did okay. Like, like we don't need the world to operate under one global system for everybody to do. Okay. We could have a Western European, U S Japan, South Korea, Australia, system. And China can go ahead and have, you know, Africa and, Brazil and India, and they can go do their own thing. I mean, that's fine. I mean, we, for decades that happened and there's no, there's no problem. So all these people that are worried about bricks and there's going to be a separate system, I would just say, why do you think a separate system is necessarily bad? Because at the end of the day, the United States, its allies have all the natural resources and everything necessary. @MelMattison1 (47:03.834) to create an abundant economy. And if we just say South Korea, Australia, United States, Western Europe, we're going to create an abundant economy and whatever Brazil and China and India want to do great. That doesn't mean there's going to be a collapse of Western civilization. Michael Tanguma (47:22.173) On that same theme, do you think energy production in China's leading growth there is overblown? Because I think ultimately, everything you're saying makes sense. The thing that kind of is still opaque and maybe there's nobody has a clear view but curious all around. It feels like this is all oscillating around three core tenants. It's energy production, humans, like human capital, and then currency. And what I mean by that is it feels like there's a chase for energy production to grow that for AI and just natural energy production for everything that's needed to run a sovereign. Then you have human component, which there's a race because of inflation where you have like, we're seeing this with the layoffs, whether it's margin compression because of inflation or automation in the future, there's going be an excess amount of humans, I think everyone would agree, from their current roles, we're not gonna be able to retrain everyone. And then the last part is the currency aspect, which you're mentioning, East versus West, that everyone's vying for that kind of like, not seniorage, like, soft power into like, who's using what currency. How do you see that flywheel playing? Because I think that's the one part that is a little bit, and I don't wanna say concerning, but it's up for grabs. @MelMattison1 (48:30.918) Yeah. Yeah, no, no. mean, I don't want, I don't want to be a Pollyanna saying everything's great. mean, look. The one of the biggest things you just brought up is I think the AI impact on labor. so we haven't gotten into that so far. I do think that's a big deal. So, so, so to me, like, I'm not really worried about repos or China, right? Like, like, I'm like, what happens if AI actually does what everybody thinks it can do, right? And if it can do everything that everybody thinks it can do. we just had some big CEOs on CNBC and different stuff talking about how, Hey, I can basically get rid of five interns or 10 interns and, have AI agents do the same thing for $37 a month, subscription payment. If that's really going to happen, that's a big deal. Right. So I do think like, these are threats and, and, what I think is that. And this is a little bit based out of, you know, personal history is these types of things take a little bit more time than people think they do. So I think that could be a potential problem. I don't think it's a problem in the next six to nine months for markets. So I think that companies are beginning to understand the power of AI, what it can do. It is very powerful. But they're not yet at a point where they're like, we don't need to hire anymore. Like they might be lowering hiring, but they're not at a point where they're like, we don't need to hire. And in fact, we need to start laying off people because AI can, that could happen in a year or two. And one of my first podcasts I ever did was, in March, I think in last year. @MelMattison1 (50:24.696) And I talked about potential market collapse in 2027 and there is still something about 2027 and I don't know what it is. A part of why I focused on 2027 in that podcast was we're going to start to become to the end of like social security. The social security entitlement fund is going to run out. So a lot of people misunderstand what happens when the social security entitlement fund runs out. And I think this is very important because a lot of people think when social security entitlement funds run out, all of a sudden the government's going to have to, you know, borrow a bunch of money that it doesn't already borrow. But that's actually not the case. Every dollar because the social security every month more money is paid out in social security than is actually in the system. How does the government handle that? What they do is they go into the social security trust fund, which, and this is like my financial plumbing analysis, which I love to do. They go into the social security trust fund and they pull out these special treasury bonds that are only issued to the social security administration and they cash those in. And then in order to pay the money, They have to go out into the bond market and raise money because they don't have the money. So there's actually not going to be any, even when everybody's going to talk about, the social security entitlement fund is going to run out. Guess what? It's not going to create $1 more in new public debt because what happens is there's just this accounting entry in the social security fund that says we have a billion dollars here. When the government needs a billion dollars, they go in, they take out that billion. Then they say, okay, we need to raise a billion and they go into the public markets and they raise a billion dollars in debt. But I don't know if stock markets are going to be that sophisticated to understand all of this. And this is going to start to come to a head around 2027, 2028. So I do think like this doesn't necessarily need to go on forever. And in fact, I'd be probably stupid if I thought we were just going to be in a bull market forever. What I do think is we've still got another year to go. @MelMattison1 (52:46.69) At least. And that's my main premise is that we're not there yet. The AI story is still good. There's still a bunch of liquidity entering the system. We're going to have, you know, politicians on the right flooding the markets next year in order to juice the economy ahead of midterms. All this stuff for me bodes well for equity Bitcoin markets over the next, let's say, to 12 months. You guys want to have me back on here a year from now, I might be saying, you know what, I'm getting worried about stuff. But right now, I still feel very good. Jackson Mikalic (53:27.84) So what you're saying is maybe people could retire on 0.1 Bitcoin six months from now. They just have to time their exit. That's what I'm hearing. @MelMattison1 (53:33.606) Exactly. They just need 0.1 Bitcoin and they're going to be fine. I mean, it's not going to be a problem. I mean, it's going to be worth $23 million. Don't you know? Jackson Mikalic (53:44.958) Mel, yeah, so there's a couple of other things I hope we can get your thoughts on before we wrap up here. I heard you on another podcast talk about... Pretty much the powers that be will do anything they can to keep asset prices inflated. And I think we touched on quite a bit of that already as to why that needs to happen from an economy perspective. Also just from incentives, right? mean, boomers still have a lot of power and influence in this country and they have majority of the assets. So it's in their favor to continue to kick the can down the road. But I also heard you say something on a previous podcast, I believe about societal problems being the biggest threat to the economy concern about potential civil I think you assigned low probabilities to this, but I'd be curious to hear kind of like your thoughts on a worst case type of scenario as well, because you had mentioned that the bifurcation of the economy today is not unusual. You know, there's always bifurcation economies. There's a lot of parallels to the 50s. But what do you see in terms of societal problems then? I mean, what could you see happening that could be potentially derailing the next 12 months that are more bullish or what do you think comes after the next 12 months aside from the social security thing that you just pointed out? @MelMattison1 (54:58.758) Yeah, I mean, that's the other big elephant in the room is the social unrest. And I think when I looked back at the 1950s, I recognized that there was a very long period of time that, you know, the K-shaped economy was allowed to exist. But at the end, it did break. And I think that was the 1960s social movements of the Civil Rights Act in 1964. Essentially people said enough is enough. Like we can't have this massive separation and you have this massive civil unrest, cultural unrest. So I do think we're heading for that. And, and it's probably going to happen sooner than 2034. Right? So it was like these decades don't match up perfectly. Like I'm not saying, okay, 1960, 1950s are like the 2020s and therefore we're in 2025. It should be like 1955. We didn't really get. civil unrest until 1963, I think it's coming sooner rather than later. And, and I do think it's coming because it's just, it's just not right. I mean, people are not happy with the way the world works anymore. They're especially younger people who, despite the fact that on a relative basis to the rest of the world live very well, I think most people want to compare themselves to their parents and the life they grew up in. And I think unfortunately, a lot of Americans are living below the standards that they grew up in. And that's not a good recipe. And that, and that, that is going to create issues. and so I think that's coming and, and that's why I said, I think 2026 is going to be good. Let's see what happens at 20. I don't think it's there yet. I don't think we're at a boiling point yet. I think it's beginning to show. One of the things I've said in other shows and different things. As far as when I might want to turn bearish is if post midterms, we get a very clear and strong democratic front runner for the presidential nomination, which they start to nominate basically January, February, 2027. So we're talking about 14 months from now that's socialist. And that is basically talking about, want to raise taxes. We want to regulate like. @MelMattison1 (57:27.366) If that happens and the stock market starts saying, Oh, there's a 30, 40 % chance we're going to have a socialist president in two years. I mean, you want to watch out. So I do, I do think like I'm in, in a sense, we're playing with a little bit of fire right now where there are some things on the horizon that could really start to collapse stuff. I just don't see them there yet, but let's call it October, November, 2020. six. Um, and like I, like I brought up earlier is the first podcast I did was about a collapse in the markets in 2027. It was more centered around social security payments, but it's looking like to me that we've got maybe 12 to 14 months of a nice run here. And then it might be a time to pull back and take profits because There is going to be a time to do that. And I am not a perma bull type guy that thinks it can go on forever. I just think that things tend to go on longer than people think. And that a lot of people are already thinking we're at the end of the bubble. I don't think we are. I think there's probably another year or so. And then when everybody else is convinced that this is going to keep going, I'd be happy to come on and say, guess what guys, I think this is the end. Jackson Mikalic (58:51.774) Yeah, no, it makes a lot of sense. I'm curious. One thing Brian flagged ahead of hitting record today was the fact that Emory University added to their Bitcoin position and also added gold exposure as well. And so I'm curious Mel, just given your background as well, having a career in the traditional finance space and Wall Street. What do you think about just institutional allocation to these two asset classes? Because they Historically have been very much under owned. I don't think gold's really been an institutional asset. It's been kind of a barbell. It's been at the sovereign level and it's been at the retail level, but it's typically not owned or very under allocated in traditional portfolios. then Bitcoin, as we all know, really hasn't had any sort of institutional interest for a number of reasons until the past two years or so. So I'm curious, just in terms of these larger pools of capital getting involved, how does that kind of play into How does that play into just the broader thesis that you've shared in terms of your next like 12 to 24 month outlook? @MelMattison1 (59:52.027) Yeah. I mean, I think that's what's happening. I think they're okay. So if you're an OG and somehow you had a thousand Bitcoin that you bought it like $200 a coin. I mean, how could you get rid of a lot of them before now? You couldn't you'd collapse the market. You, you know, like this is the first opportunity and people are looking at that. And I don't know who these guys are. I. Wish I would have been one of them. I remember driving down a bridge from my town home in Fremont neighborhood of Seattle down to downtown Seattle when I worked at Russell investments in like 2012. And I was listening to an NPR, you know, story about Bitcoin and I went in and I tried to buy it. And this is before Coinbase. I couldn't figure out a way to buy it. And I was trying to like download a browser because they said you need to download this, you know, Silk road browser and all that. I was doing all this stuff, trying to buy Bitcoin in like 2012. I really was. And by the way, I mean, like I'm a guy and I always do this on my podcast because I like to put my microphone on one of my thousand ounce bars of silver or a hundred ounce. It's a hundred ounce bar, which I paid like, I don't know, 1200 for now it's worth like 5,000. But what I say is like patient scratch hopper, right? Like. I paid like 1200 for that, but that was like 20 years ago. Like don't get too crazy about Bitcoin. Like I say, don't think that it's going to go to 2 million next year. It's just not, I think Bitcoin is going to be the best performing asset over the next 10 years compared to gold, the stock market, everything. But I don't think that it's going to go up 80 % every year. I just don't think that's going to happen. And I think people need to. Get that one of the most unpopular things I've ever said on Twitter was I posted a tweet of Sam Beckman Fried, Bernie Sanders and Michael Saylor. Like I don't like Monster. I don't like it. I've never liked it. When Monster peaked last year, I said, you know what? It's a great trade. Short Monster by Bitcoin. I don't like these treasury companies. I don't understand them. You know, call me crazy. I don't understand them. @MelMattison1 (01:02:18.532) You know, Michael Saylor is a great salesman. I'm sure he's probably a good guy. He's probably done more for Bitcoin than anybody, but I'm also worried he's going to, you know, eventually tank this whole thing because that whole monster thing is ridiculous to me. Like how in the world does it make sense that you buy a bunch of Bitcoin and then your stock price should be worth two X the amount of Bitcoin you hold. Jackson Mikalic (01:02:46.718) Mel, you're really gonna get Michael fired up here. And before you do, was just thinking, back in 2012, if you had purchased some of that Bitcoin, how many financial thrillers you would have had published by now? Michael Tanguma (01:02:49.613) Yeah, we all. @MelMattison1 (01:02:56.454) Well, look, I don't want to, I don't want to create trouble here, but I'm sorry. I just don't understand these treasury companies. I don't understand how you buy an asset, put it on your balance sheet, and then somehow you should be worth more than the assets on your balance. I don't get it. Michael Tanguma (01:02:58.869) Yeah, there was a lot. Michael Tanguma (01:03:07.234) Yeah, they Brian Cubellis (01:03:08.272) No, you're preaching to the choir. Michael Tanguma (01:03:15.565) Well, there's a few things. Mel, I was looking for a few things to chat about going on your Twitter and congrats on the Marines 250 year anniversary, because that makes a lot more sense. You're a former Marine, you have common sense, because that's what's lacking. And most people fundamentally think that these Treasury companies have some value above one and they just never have. We've talked about it. Oh, of course. No, no, we've been yelling at the market. Yeah, No, no. @MelMattison1 (01:03:34.51) Also, you agree, Michael, you're not. OK, thank God, I thought you were going to come at me for saying this. I thought you were going to. Brian Cubellis (01:03:40.934) No, we've been talking about this for what seems like over a year now. Just being generally skeptical. @MelMattison1 (01:03:44.992) no, I think it's scam! He's a Barnum and Bailey salesman, he's a joke. Michael Tanguma (01:03:45.578) I yeah, I didn't realize that, I never heard it called Monster, so I was confused when you started mentioning it, but that's a great name for it. MSTR. But is your computer on 100 ounce? Gold bar is the first thing I was just wondering. @MelMattison1 (01:03:55.718) Whatever they call it, I don't know, MSTR. @MelMattison1 (01:04:06.214) But I do have another like 10 ounce Australian coin and other coins and like look I've been Look before Bitcoin ever existed I recognized as did other guys including Peter Schiff who is a complete joke in as well with his debasement of Bitcoin doesn't understand it, but look I understand Peter Schiff because I was I was one of these guys like 20 years ago, I'm like, this fiat thing is a joke. This is ridiculous. How in the world can the world just live off of money printed by the United States? It's like, this is crazy. It's never gonna last. You gotta own something. And what have people owned? They've owned gold, they've owned silver. So I started buying gold and silver in 2005, 20 years ago. And I tried to buy Bitcoin and then what happened is... I got sucked into the TradFi bullshit. I was a Duke MBA. I ran a broker deal. I ran three broker dealers, a CEO, Finra. I was like, I'm not going to buy this shit at 2000. Forget about it. And then it would go to 4,000 and then 5,000. I'd be like, Oh my gosh, this is crazy. I finally bought my first Bitcoin at 11,000. So I wasn't that late. right. You know, but it took me time. I should have bought my first Bitcoin at 200, but It took me to 11,000 and then I finally bought my first Bitcoin and I've hold onto it and I've held on and I've bought more and everything. And then I also have gold and I have silver and anybody that follows me on Twitter on X and Mel Madison one, they'll know I say there are two anchors to my portfolio, gold and Bitcoin. Then what I do is I have a satellite portfolio of stocks because there are opportunities in equity markets. So there are things like a Robinhood. or a SoFi or different things that can go up four or five X in a two, three year period. And so I look to those to be basically juice. But to me, the core of anybody's portfolio should be gold, Bitcoin, silver, that because, because everything else I think is going to go down and then you try to pick stocks that are going to do better than the market. Michael Tanguma (01:06:15.35) Yeah. Michael Tanguma (01:06:22.861) Well, credit to you for changing your mind because most money managers that miss Bitcoin at 200 just continue to double down on why it can't work. There's famous ones I won't call out that are out there. But that leads me to a question that I think you're probably one of the few individuals that would be tempered enough to answer this in an objective way is how do you effectively see over the next call 2 to 10? And I know this is a fool's errand, but I'm going to ask you to play it either way. Is gold and playing alongside themselves? Because As you start going further and further understanding what you're describing, we work in this industry, you start to realize how individuals all the way, institutions navigate this. And there is a notion on Twitter and in the Bitcoin camp that Bitcoin is obviously, I want say obviously, but is a more perfected version of gold in the sense that it's finite and you can really transport it where gold has these flaws. but there's still reality of inertia, DNA built into humans and sovereigns. How do you see gold and Bitcoin playing out as they try these different BRICS currencies and these different things and ultimately somebody gets a thousand bar or whatever it is shipped that's tungsten and they realize they could have just shipped this digital bearer asset. How do you see this playing out as both of these monetary units go up in dollar purchasing power? @MelMattison1 (01:07:37.585) They both have their positives and negatives. I mean, if you don't see that, then you're just a fool, basically. Like if anybody's like, gold has no positives over Bitcoin. I mean, okay, let's say that I'm China and I want to send a billion dollars to Russia and I don't want it to be traced. I don't want it to be on a ledger. I want Russia to be able to melt it down. I want them to have no clue. that I just sent a billion dollars. How do you do that with Bitcoin? So there are things that gold has that Bitcoin doesn't have. There are things that Bitcoin has that gold doesn't. If I'm Russia and China and I want to send a billion dollars to Russia instantaneously with no cost, how can you do that with the gold? You can't. So there are positives and negatives of Bitcoin and gold. And I do this all the time. Like people are like, well, Bitcoin is just a superior gold. I'm like, you don't understand. Gold has certain properties that Bitcoin doesn't. Okay. Number one among them. is anonymity. Like you can completely destroy any connection of where gold came from. You cannot do that with Bitcoin, right? It's a public ledger. You're going to know what those keys are, where that address is, where it came from. You cannot do that with, with gold. You can do it with Bitcoin. we go. Another thing, gold is a physical element, right? And, and this To me, this is the biggest threat to Bitcoin long-term. I've said this before in podcasts. I don't think quantum or anything like that is the biggest threat to Bitcoin long-term. I think the biggest true threat to Bitcoin long-term is two, three generations down the road. People start to say, you know what? Our great grandfathers had Bitcoin. We're going to create Bitcoin 2.0. And this is now. @MelMattison1 (01:09:35.877) what we want to be the monetary base. And how do you stop that from happening? I look, but then again, I can go back and I can talk about all the advantages that Bitcoin has to go Bitcoin and gold. think there's this thing in the market. Sometimes like people are like, Bitcoin is just completely superior in every way. I just don't believe it's true. I think there are benefits to Bitcoin and benefits to gold. And that's why both of them should be embraced together by everyone who truly believes in this Fiat debasement scenario. that if this whole argument between Bitcoin and gold, honestly, I don't understand it. I don't think it makes sense. I think that it's misplaced. And I think that both of them have their own elements that are positive and negative. Gold has certain things it can do, Bitcoin can't do and vice versa. Jackson Mikalic (01:10:34.982) Well, you also have to understand that a lot of people in the Bitcoin space think that all asset classes just go to like their utility value and everyone just only holds Bitcoin. So there's a lot of pretty delusional takes in this space. @MelMattison1 (01:10:46.982) Well, that's an important point Jackson. I would like to bring that up because I did think about this ahead of time. Okay. Because there's been a lot of talk on the internet in the last year about the hurdle rate, new hurdle rates Bitcoin. Okay. If we go two or three weeks and Bitcoin still where it's at, guess what the hurdle rate is for the last year? Zero. Okay. So here's my point. Bitcoiners need to grow up. Okay. Bitcoin is not, you're not going to retire off of 0.1 Bitcoin. Bitcoin is not going to 23 million. Jackson Mikalic (01:11:14.592) Don't tell me that. Come on. Brian Cubellis (01:11:16.163) Hahaha @MelMattison1 (01:11:16.722) Bitcoin's not going to go to 20 million in the next two years. What I do believe, and this is the honest to God truth, in the next 10 years, as far as major assets, the best performing of all of them will be Bitcoin. But you have to ratchet back these expectations. I think Bitcoin is off of the four year cycle. Bitcoin has been appropriated by the financial establishment. As much as people that love and venerate Satoshi will hate that. This is the truth. And you just need to grow up and accept. This is what's happened. Bitcoin is now a financial asset within the financial system. There's iBit, there's futures, there's options, there's everything else. And guess what's going to happen? It's going to appreciate more than any other asset because what it's going to do is it's going to represent this debasement trade. But people that think it's going to do what it did in 2010. Are nuts. It's not going to do what it did in It's, it's now in a new area. It's the best asset to own out of every major asset, but what you should expect is a 15 to 35 % annual return. And if you want to retire off of 0.1 Bitcoin, it's, it's going to be tough. And I think that's just what happened. I mean, that's my opinion. know that. These are all horrible things. I, I think sail it. I got to just call the balls and strikes the way I see it. And that's the way see it. Michael Tanguma (01:12:49.835) Yeah, no, I appreciate you calling that out because it's spot on and it's, I mean, it's fundamentally why. Michael Tanguma (01:12:58.381) ... crypto exists because everyone's trying to get rich. And so I've been making this case that post 2020, the amount of monetary units being inserted that Bitcoin just is keeping pace with effective inflation, maybe a little bit above that. So point being is you get an asset, you can store your wealth, you can store your hard earned time. It can appreciate at par, maybe a little bit greater than inflation, but that's what it's doing. And that should be enough. And then you have to go back and produce value in the world. But we forgot how to deliver liquidity sponge. But the notion of @MelMattison1 (01:13:24.79) And liquidity is... Michael Tanguma (01:13:29.007) This is why the DATs exist because ultimately people forgot how to deliver value so we have to financialize these assets and there's certain people that are getting enriched with the DATs and then they're basically selling that I'm giving you better Bitcoin it's gonna run harder and faster than Bitcoin so buy my DATs are the monsters. So buy my thing and that's just it's just it's just a manifestation. Yeah. @MelMattison1 (01:13:45.317) No, stay away from those. Stay away from that stuff. And the, the cryptos too, you know, and it's like, and this is the thing with Solana and ETH and all of them, which I will say, because I do have firm views about being very pro Bitcoin. Like I'm, I'm not like necessarily what, what, would be considered a maxi, but I do believe there's only one Bitcoin and I believe Bitcoin is crypto gold. And I believe everything else that people talk about. Brian Cubellis (01:13:46.354) penny stocks. @MelMattison1 (01:14:12.282) The reason why it has value, whether it's ether soul, it's because it's serving some sort of a operational purpose, which can be displaced and therefore, ETH soul can be displaced. Bitcoin, I believe, cannot be displaced, at least not easily. It would take an entire multi-generational effort to do that. And so I think there is Bitcoin and then there's everything else. I think that's clearly the case. don't think, I think Bitcoin dominance is, is just growing. Right. I mean, like, I mean, you, you, you look back at like crypto, like all these other things, like they're utilitarian tokens. I mean, that's what they're there for. Like I own some Arb ARB or something like that. That's the L two Ethereum token that Robinhood's running. It's, you know, private market equity's on like, like because I'm owning it or I own, um, what do I have? Uh, what's it called? Uh, I, it, it, it, it, there, there are a couple other cryptos that I own. Okay. My point is I own them just as trades because they're just operational tokens, you know, a virtuals, virtuals. That's what it is. Um, which, which, which is an AI agent token. You know, and it's gone from 80 since I bought it to one 80, like I'm up like 80%. Then I sell it. Like, so I do play a little bit in the crypto space, but very little, very little. But then Bitcoin is in a level by itself and people have to recognize that and financial advisors and like Morgan Stanley's and everybody else recognizes that there's Bitcoin. There's everything else. They're going to start moving people in and here's what's going to happen at the end of the year, especially with Bitcoin around a hundred thousand. All these financial advisors at Morgan Stanley are going to go to conferences in like San Francisco and everywhere else. They're going to get big steak dinners. And there's actually going to be somebody from Morgan Stanley who understands Bitcoin. And he's going to say, guess what? This is the time to put your clients in it. Don't put your clients in Bitcoin when it's at 150. Put it in and now, know, rebalance at the start of the new year. Um, do this. @MelMattison1 (01:16:34.276) And these are the buyers, the OGs are selling and here's your buyers. is, this is grandma and grandpa, 78 years old. They're Morgan Stanley and buyers just going to say, look, do a 3 % allocation to Bitcoin. we're at a hundred thousand. It's a great point to come in. And this is going to happen. And that's why Bitcoin's not collapsing. so Bitcoin is just going through all of this maturation. Jordy Visser did an amazing piece called the Bitcoin IPO. This is the Bitcoin going through this maturation cycle and heading into the portfolios where it's going to sit for decades. And then it's just going to start going up and up and up. And I think more than the stock market and even more than gold. Michael Tanguma (01:17:21.301) I'm really glad we're maybe ending here because I wanted you, you touched on this early, about Bitcoin sitting basically flat for a year and why that is so bullish. And I know this is oversimplifying, but it's worth saying that obviously when the price goes up, there's more buyers and sellers down, more sellers and buyers. But when it's flat, doesn't mean nobody's selling or buying. It means it's transferring hands. And that's effectively been happening the past year. And the other thing that's worth calling out because it's a very big deal is everything that came out the past two days from Square and Blox and a lot of the infrastructure that's coming around from like payments and things that will happen around Bitcoin. The reason why I call that out is because that's happening across the world and specifically the US when you think about Morgan Stanley, Charles Schwab, fidelity, like there are so much fundamentals that have been added to the network in the past 12 months that the price is flat but there's plumbing that's happening that the market doesn't fully appreciate. And so to your point, it's just preparing us for us for what's coming next, which just doesn't get widely discussed enough. @MelMattison1 (01:18:18.406) Yeah, this is stuff people don't understand. Hash rates, plumbing, all this. People don't understand what Bitcoin has that nobody else has. So they're like, oh, well, Bitcoin is just a coin and anybody can create it. No, no, no, no. You don't understand what makes Bitcoin Bitcoin. mean, Bitcoin is Bitcoin because of the owners, the holders, the people that have the hash machines at their bedsides, the network. Um, I mean, this is not easily replaced. It's not easily duplicated. It's, it's, it's unique. And that's, that's why I've been going on podcasts for over a year and a half. I have never advocated one single cryptocurrency except for Bitcoin. Bitcoin is unique. Bitcoin is gold. Bitcoin is something that is just You can't replace it. And that's just the way that it is. I'm never going to be convinced that, it's a great idea to just sell my Bitcoin. Like, I'm going to go in there because it's at 95,000 and sell it. No, I'm convinced that it's going to be at 150,000 by the end of February. Come have me back in here because I honestly think these charts are shaping up and here's what's going to drive it. We know that the federal government needs to drive fiscal stimulus ahead of the midterms. We also know that last year in January, Trump gave Besant the mandate, come up with the sovereign wealth fund by the end of January. We also know the Clarity Act, which is the Bitcoin Act. Okay, there's a big difference between the Clarity Act and the Genius Act. I've been following these act for years. The Genius Act was a simple stablecoin act. The Clarity is going to be clarity around digital assets. All of these things are going to start to happen. They're going to be narrative drivers. Could we bounce around this level for the next, like I said, last time it happened, happened a month, four or five weeks. By the end of December, I think Bitcoin is going to be off to the moon. I think we're heading to 130, 140 by January, 150 by February. I just see that happening. And if I'm wrong, then @MelMattison1 (01:20:37.85) Have me on please in February and let me explain why I think I'm wrong, but I think it's going to happen. I really do. Jackson Mikalic (01:20:45.086) Mel, if you're wrong, I'm gonna be working at McDonald's. I won't be hosting this podcast anymore. Brian Cubellis (01:20:48.474) You @MelMattison1 (01:20:48.742) It's going to happen, man. This is just a bouncing along. It's bouncing along the same lines. I'm looking at it right now. Okay. 99,000, zero seven one, man. It's, it's right at those lines. It's right at these lines. I mean, it's, it's, it's exactly where it's always been. You go back and you look at, you look at where it's done it. mean, basically I'm looking at April 8th. We were at 76,000. And if you go back to September 24, we were at 52. Okay. So we went from 52 in September, just a little over a year ago. Then we hit a low of 78 in April. And I mean, you draw a trend line. between those two levels and you basically get to 99,000 right now. And I'm telling you, could we be wrong? Sure. I could be completely wrong, but I'm looking at this and I'm telling you, you do not buy stocks. You do not buy Bitcoin when it's at 125 and it's been up 25 % in the last three weeks. And that's the dumbest time to buy anything. And Jackson Mikalic (01:22:12.5) Well, Mel, if you believe that you can retire in 1.1 Bitcoin, you don't care at all about your entry price. But I guess if you're a little bit more pragmatic about where it goes in the next handful of years, then the entry price does matter, especially its size too. Brian Cubellis (01:22:25.352) It wasn't that too long ago that people would joke about, know, proverbially crashing to 100K. Like when I started learning about Bitcoin 17, 18, that was a meme. Like that was a joke. you know, one day we're going to joke about crashing to 100K and it's literally happening right now and people are still freaking out. @MelMattison1 (01:22:25.722) Yeah, think this is this is your magic point. @MelMattison1 (01:22:46.822) Yeah. Okay. So I'm looking at, okay. In December and January, we had a double top around 108. We then dropped down to 75 in April. If you draw the trend line from September 24 to April this year up to now, I mean, you, you hit it exactly. And it's, it's like, this is it. Like, when do you buy? You do not buy when everybody is telling you, you can retire on 0.1 Bitcoin. You buy when you're hitting these bottom trend lines. You buy when everybody is telling you the Bitcoin story is over. You buy when everybody is saying the four year cycle is here. We're going to crash 80%. This is when you buy like this. I've been doing this a long time and I'm just telling you, you Every time that something like this happens and like Bitcoin goes to like 125 I'll be out on the next saying I'm selling my Bitcoin. Uh, it's, it's, it's Now I'm saying, look, I was early, like a week ago, I was early, but I'll be honest with you. We first hit a hundred thousand on. @MelMattison1 (01:24:05.446) November 3rd. It's now November. It's now November 13th. Okay. So we've got 10 days where we've been here. When I go back and I look at where have we bounced from on this channel, there have been month long bounces. So if, if we started at 11, 10, then we're going to December. Uh, no, excuse me. If we started on 11, three, we're going to 12, three. Okay. We're going to 12, three. Michael Tanguma (01:24:05.975) December or last year, November. Jackson Mikalic (01:24:29.632) We're just going much higher. @MelMattison1 (01:24:34.468) So what I'm saying is like between now and December 3rd, could we bounce along this line? And that's the next two weeks. Sure. But every single time it hits this, it then goes up and I just don't see a reason why it's not going to do that. And, and so that's why I said in an expo site just today, next one to two weeks could be choppy. So expect chop the next one or two weeks. And then, and what's going to happen is. As I said before is fiscal surpluses are by definition private sector deficits and vice versa, meaning fiscal deficits are private sector. The government is going to start injecting mass liquidity into the system in the next month or two. mean, mass liquidity, like probably the likes of which we've never seen because we had 180, 80 billion deficit in September. Now we've got the end of shutdown. I mean, these are just setting this whole thing up. And it's just like, this is when you buy. You don't, don't buy when Bitcoin's 126 in January of last year. mean, that's the stupidest time to buy because everybody's telling you buy 0.1 Bitcoin and you can retire forever. So this is when you buy, when everybody's telling you Bitcoin's done. Jackson Mikalic (01:25:57.376) Love it. Well, Mel, you know what? We're going to certainly have you back on the podcast. Whether the price is in the gutter or we're on the moon early next year, you'll be back on. We may also do the book club. I'm certainly going to check it out if I get a little time to slow down around the holidays. So appreciate you joining the podcast. I knew it going to be electric. I thought it was going to be a fun one and it delivered. Where should people get in touch with you if they want to learn more? Michael Tanguma (01:25:57.803) Love it. @MelMattison1 (01:26:23.888) Yeah, come to Mel Madison one M-E-L-M-A-T-T-I-S-O-N one on Twitter or X and then melmadison.com. And I really appreciate you guys having me on. I really didn't mean to be too electric, but I just think this is the perfect time. I honestly think that since April, literally today, as we record this on 1113, this is probably your best Bitcoin buying opportunity in six months. Jackson Mikalic (01:26:50.548) That's what we need to hear. Well, thanks, Mel. It was a pleasure. Brian Cubellis (01:26:53.48) Appreciate it, Mel. This was fun. Michael Tanguma (01:26:54.69) Thanks, Mel. @MelMattison1 (01:26:55.687) Thank you.