The Bitcoin Presidency & The Dawn of a New Robber Baron Era — ft. Josh Brown
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today's number twenty one hundred dollars. That's how much wicked dolls are going for on the secondary market after a misprinted URL leading to a porn site was discovered on their packets, treasure ray, burberry wrote book about my maco having sex here, right? It's called something wicked. This way comes.

I miss me happy. And how are you come to?

Does dad, i'm doing very well. I'm excited you just arrived in new york this morning.

right? Yeah, I do. I look like, I do.

I look like I ve been through fucking five time zones and done two hours of podcast. I mean, look at me, scribe. I look my age.

which is really old. You look like perfection.

How is the flight? Fine up? Dark hours took off at seven. Yeah.

it's fine, right? good. You like you. You seem good spirits.

I feel like i'm delicious. Okay, you're delius IT all catch shop laser and pretty. What's going with you? I'm pretty good. I'm going to come see later this afternoon. I pretend to be your producer because I just want to go meet one of my favorite comedians. Whose pod costs you going on? I don't know if I can mention the name yet, but and I think you can why not see .

of on and I don't I don't know i'm i'm so not with that. I don't know who think of hon is why do you like him?

Uh, he's just hilarious has very a cycc strange guests on no not that not that you're either everything on one of those .

things get trump on no .

good but I forgot one allowed to mention him yeah I think it'll be a very interesting podcast. He's a very weird did that will be will be a good dynamic.

I'm excited about IT.

I'm excited that he sounded excited.

Honestly, I am also meeting with I mean, with very deal this tonight at the car life hotel. I can I be any wider meeting with .

very delia?

Where s would I meet? No, what what mean? Yeah, we're meeting the bowing out. If I go to hotel, I, me, they are like banging on a pro. I'm in the bar. You know that how I can tell if, uh, the Young man is a male east is he returns my eye contact to the bar the four seasons OK.

yeah, should we get in the headlines?

Yeah, that's a great headlines about business news. Go, let's talk about GDP.

No, I am yesterday.

Hi, I hope you have plenty of the the federal reserve .

cut interest rates by twenty five basis points as expected. In addition, federal reserve charger on power status that he would not resign from his post if asked to do so by president elect trump. The value of the global cyp to currency market has topped three trillion dollars, with bitcoin hitting a record high of eighty nine thousand dollars.

Crypto related stocks also saw gains as the demand for digital assets surged following the election. And finally, sharp fies third quarter revenue rose twenty six percent from a year earlier, beating analyst ctab that its six consecutive courts of greater than twenty five percent. Revenue growth, excluding logistics, the stock rose more than twenty five percent following that earnings report. Scott, your thoughts starting with this fed cut, but perhaps more importantly, this interaction between the reporter under pal, who was pretty unequipped, he would say no if he was also to resign.

I don't I mean, I can't predict anything. This guy is gonna when I say this guy mean president from but I think if there's anybody that you'd want to renew their contract, IT would be a man pow. What he has pulled off is just remarkable.

And you're gonna very soon, you know, seven, ten, thirty days, president trump start to take credit for this incredible economy. And this incredible economy has been brought to you and granted, like similar to the future, as when gibsons said, is not evenly distributed. I think that most attacks and fiscal policy that cheves a ton of prosperity and opportunity into the one percent into corporations and the the shareware of the corporation sea above the one percent.

But in terms of growth of the pie and our ability to keep inflation lower than any other nation despite how bad IT is to create growth greater than any other nation, everybody was everybody was predicting a recession. We didn't had IT. This guy pulled off a soft landing and hurricane ins.

He was he showed huge balls raising interest rates five hundred bips and fourteen months, which assist unheard of. So this guy, this guy doesn't just get the gold metal he gets. Everyone else is metal.

So I don't I don't understand what trump would pick this fight. But we're projecting maybe you know we're speculating he hasn't picked that, that fight yet. IT seems like the media wants to pick a fight. So I think this might be a bit of a nothing bird .

or what your thoughts it's worth, maybe just summarizing what the law actually says about this. So the president actually does have the power to remove a member of the board of governors of the federal reserve, and that is a position that the jay power holds. But the president needs to have what is called a cause.

What actually does that mean? What is a cause? This has been debated in the courts, but historical IT has been interpreted as, quote, inefficiency, neglecting duty or malfeasance in office.

So this is only really viable if trump can prove to a court the drone pile did something really bad during his tenure, which would be really, really difficult. The other reason would be difficult as that in the law there's no reference of the fed chair itself. It's only IT only refers to members of the board of government.

So in some, this would be a really complicated legal battle. I don't think it's a battle that trump really cares enough about to go out and fight, but my prediction for this would be you room paw's term is up in twenty twenty six, so it's not that long. I think the trump let him serve out his term.

And in the meanwhile, if anything goes wrong, trump can always just say, I told you so, which is a position he loves to be. And he can just say, you know, I tried to get rid of drone power. I didn't like him, but the deep state didn't let me.

I agree with something about the hell he wants to die on a crypto. You know, we call this election a lot of things a inflation immigration in commencing are been calling at the test test election. Or the kids are not not a right election or stronger, I mean, election.

Everyone wants to brand IT. You could safely brand IT the Crystal election and that is crypto showed up uh trump flu into the storm waving a big crypto pirate flag. IT was a brilliant move because crypto is probably just as democrats were hoping that people focus on bottle autonomy would be one issue.

Voters in some of the more, but I think there was a lot of overlap with people who are urting going to vote for Harris. He went right after the rose bro and bravo es in crypto and said on your man, and there's a lot of people who have got a lot emotionally and financially and cypher u and probably think this is my mom. And so this was a smart strategy on the industry.

I would be surprised to continues to go up if you know there's talk of creating a super fund back by the government with the government puts a hundred billion dollars in two into bitcoin, which could take the thing to god s god s where we would be also interesting as to look at microstrip gy, which is sort of become a tracking stock, and Michael sailor, who everyone thought was crazy, including me, cheese's Christ in one year microstrip gies up seven fold. Microstrip gy is basically a lever bitcoin Better at this point. In the last one month, it's up seventy three person.

In the last six months, it's tripled. SHE is great. I know this guy, he told me to buy fuck in bitcoin at eighteen, at eighteen thousand.

He's been on the part of, we got him on the pod. bright. I anyway, this is is interesting as a new corner.

I'm a little bit bomb. I have some consolation and that is I still on my claims. And F T X.

And F T X holds a much of coins. So as is the reason that the value, this claims the sky rocket. So that's some new sports for me deciding that I didn't understand that. So I wasn't going to go into IT. But this has been .

this is arguably the clipt to election. What what i'd like to .

know if you to buy back at investor is I think I think things aren't cheap enough, are almost waiting for them to come down. And when I look at when I look at big coin, it's an asset that is offered. I think it's been up, I know, eighteen or twenty percent of years for the last ten years, but it's highly volatile, which means in my view, at some point, it's going to be probably for a brief time back at fifty, forty or thirty thousand dollars.

So i'd never like to buy into strength. And that's that's a four of mine because sometimes you just never get the opportunity by. But I do think I keep telling myself the next time IT looks like it's got a bit of A A bit of a correction or a bit of a draw down, I will buy some biton. I think you have to give IT to this asset that IT is now a legitimate why?

Why do you say that? Because of the Price or the institutions buying IT, what what do you think has changed?

I think IT is established credibility as a storage value because the genius of my mind of bitcoin that the others don't have is that IT has this incredible mechanism of trying to mind the coins. And every incremental coin gets harder and harder and more expensive to mine. And they say they're na stop mining coins at twenty one million and people, the market seem to believe that.

And because if you think about the incremental uh, supply coming on the market of bitcoin, it's less than the supply of incremental gold is way less than the number of incremental dollars, it's less than the incremental supply of oil. So this is an asset class that has wide adoption across institutional investors and now has a regulatory framework or regulators that are going to be friendly as opposed to policing IT. But trying to create an Operating system that supports said and IT has an administration running the world's largest economy that is now going to you know, has basically blessed and said that we want to get we want to get off our heels on this thing and on our toe.

So I would argue this is as legitimate asset class right now is a lot of other shit. I just won't be surprised if I if I hit hundred thousand hours the next thirty days. Having said that, i'm not by right now. I I always do this and a lot of times i'm wrong. I'm going to wait for, uh, a correction or a drop down before getting .

and how about you at these cyp conversations? We just always go in circles. I mean, it's just we always have this conversation again, right? IT plum, its and everyone sitting on IT and then IT comes back on the mural questioning, I mean, I guess the thing that i'm thinking right now is, one, this was predictable.

I mean, if trump wins, this is an asset loss that is predicted on hype and on internet personalities and in large part, on conman. In a lot of cases, trump is sort of the holly trinity of all those things. So you couldn't create a Better mascot for crypto.

And now he's also going to be president. So bitcoins ranging, I expect IT rally even more. I think that one hundred thousand as a Price target over the next study days is completely reasonable.

I could so I could easily see that happening once he's in there. I think it's going to be a different story because we're going out to start all asking like the actual questions like and he's talking about this strategic bitcoin reserve. Well, what would that actually look like? What is the function of that reserve? Can he get IT through congress, which he needs to do? You know, we're going to see procris pal regulation.

What does that actually mean? I mean, bitcoin is legal everywhere. There's nothing preventing anyone from owning bitcoin. You can buy, you can put IT in your four one k we have institutions that are creating these bitcoin etf like the world is pretty pro bitcoin in general.

So what will trump do that actually makes IT more functionality or makes IT more valuable? Those are sort of the questions that we're gonna to eventually ask once we get to january twenty years. I could imagine, you know, a year from now or probably even sooner once he's actually in there and he's talking about how this will actually work from a regulatory perspective, suddenly things going to get a lot less exciting.

And i'll bet you'll start to see crypt or Prices start to moderate. But we have this conversation a lot, and we'll talk a bit more about IT with josh Brown in a moment. Moving on to shop.

Fy amazing quarter revenue increased twenty six percent year over year. I have one thought that all for now. First get reactions to shop. Fy earnings of company .

is really well run. I would argue this is the most interesting company out of canada. And I love the story of shop pithy that amazon. Have this approach where we use massive capital to offer consumers and our suppliers a Better deal.

The major of revenues at a very low Price flow through to the retailer on the third party platform, which is now makes them more revenue than the actual retail side when they take license to the inventory. And then over time, when they ended up with fifty percent share. And you can have to be on the platform if you wanted to grow your recommend ce, which every company has to do, they started raising the rent.

And one of the ways they do that and capture more and more shareholder value as they on the data, you don't if you're on the platform, we really don't know much about the unconsumed they are on the packaging. A shop fy ig driving was aggers and said, no, uh, we like customers. We want to give you a small company ies selling supports and our beach.

We're going to let you control your packaging. We're going to make a cheap and easy for you to have a really good looking website. We're basically going to democratize e commerce.

And then what if kind of that that almost feels cloud like they flipped on a lot of interesting tools, A I tools that appeal a bigger brands. And so IT IT feels like it's kind of elegant adopted this A I slash cloud fuel to what is effectively a web services or infrastructure as any web services. It's A E commerce infrastructure company in some more power to them in a great company doing doing really well what you thought.

Yes, I just have one point about investor relations, which I find quite interesting here. So one of the things I talk about in this jensie talk that i've given to companies about you know how to how to Better get through to J Z. While the point is just the investor relations is very outdated right now and as the demographics of your investor base change, I either age your strategy and investor relations needs to change as well.

And the reality is that the way I all works today is just not suited for a twenty five year old brain. These earnings calls in these press releases, they're boring, their complex, they like quick insight. Companies just need to radically rethink the way they do invest relations.

And my prediction has been I think I made IT on this podcast that we're going to see a massive surge in sort of quick tiktok style earnings updates where the city we'll get in front of the camera sort of run through what happened over the quarter, maybe thrown some visuals to make IT more interesting. That's exactly to what shop if I did this quarter. So the president got on the mike IT was like a three and a half minute summary.

Here's what happened. They block ted IT across social media channels. This is something that spotify has been doing too. I think that's the way to do invest relations in two thousand and twenty four. And I think we're going to see a lot of public company CEO follow suit because I think everyone is realizing, you know, these press releases, these earnings calls, these deaths that just outdated yeah.

So my third book, post corona number four, new york by solar, was basically the big theme there. IT was the word dispersion. And that as amazon effect, vely said, okay, we're going to cut out walls and skip, you know, leap frog is part of the supply chain and disperse three to get a close to the consumer.

Netflix kind of skipped fiber optic cable and went to the neutrality or skipped comcast the time morning and said, I don't need to go through the cable company. I'm going to get my own information and i'm going to use this free cable company called the internet. This is really where your time is the same thing.

And that is there is an infrastructure around managing, uh, your communications around childers. There's investors relations, there's parents, their C N, B C, there's analysts, there's investment banks, the S, C, C. And then see us. We're going fuck that. I'm going to get a phone.

I'm going to practice my lines and I going to walk around my office and say, this is what happened this quarter, and i'm going to go straight to the end consumer, specifically the retail consumer, who often times is willing to pay a Price that may m rational the short run, and I can boost my earning schools, right? I can, to a earning cent. Chen hong, selling on arena is a diversion.

He's not he's not trying to get on C, M, B, C in the wall sty journals like i'm going to straight to the end investing and I not the institutional investor. I'm going straight the retail investor. Yeah, I agree with you.

I think you nailed this prediction. I think you're going to see what's going to be hilarious is you going to find some old mainline companies for CEO to bright up room by leaving at trying to do something fun and interesting. And it's just it's going .

to be an asset.

L here here. A jose hiping, we had just we had a blow out quarter. Here's my hao beto to talk about .

really people are going to realize that this is the way to do IT. And they going to like, throw these seven year old days in front of in front of a phone and record a tiktok. And it's gonna awful.

Do we like, is IT recording as I see a red light?

We will be right back after .

the break for a conversation with josh Brown. If you're enjoying the show so far and you haven't got, be sure to get property markets to follow wherever .

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Welcome back. Here is a conversation with josh Brown, cofounder and C. E. O of rita, lds wealth management. Josh, thank you very much for join us.

So great to be back.

So we're just off my saying that you are a little less political than we are, which is what we need right now. But we're onna start with just the stock markets reaction to trumps win. And i'd love to just get through all of your reactions and a let's that's root this is not being political but you said just earlier let's just evaluate what is actually going to happen here um which I trust you to do so uh basically every U S.

Index rally on the wind. So the S M P broke six thousand and the door had its bigger weekly jump in year, the nas dark rose. I think we all expected that.

I'm not sure. I'm not sure all of us expected that I would rise this much though. So my question to you to start, Sophia, has this very broad rally, has any that comes a surprise to you? And if not, why not?

So this has been a very eight typical election year for socks. Normally, there is this pattern where volatility comes in september, october heading into an election, especially one in which you think there's gonna something contentious or something undecided. And we had the opposite the thirty days leading into uh, election day.

We had not a single example of two back to back negative days for the s and p five hundred. If you think back to the wall street consensus over the summer, IT was, hey, everything's great right now. But look out when we get closer to the election of volatilities going to Spike.

We actually went in with a vicks about twenty. For those who are not fully aware of what the vics is, IT basically measures options activity. People who are buying puts um people who are selling calls, people who are preparing themselves for a market event within a thirty day window.

If you were really expecting a lot of volatility, you would have seen a higher vicks going into the election. Average is about twenty four or twenty five historically. So we had a below average fix.

We had no back to back a daily sloops in the S M. P. Five hundred. And we basically had a rally that started sometime in the middle of August when he appeared that the negative uh payroll data that scared everybody about a recession was a one off due to the storm.

And as a result, IT was very a typical versus what you would Normally say. That was an interesting tell. The other thing I want to say about the backdrop here is record inflows to money market funds, record inflows to treasury bond.

Tf, we're talking about over six trillion dollars in money market funds, which is the investment account equivalent of cash. And we're talking about an environment where a lot of people were prepared for chaos. And when that chaos didn't come, they said, right, well, I have too much cash.

What can I buy? So I I don't think I was surprised. One of the interesting things historically ally about elections is IT doesn't matter who wins, investors x hail and they put money to work.

They like the we certainty, which I know is not a real um but you go from its its binary, it's flipping a switch. The tuesday morning of election day you have a lot of uncertainty sometimes and then by tuesday night you have certainty. And we saw the same thing happened in two thousand sixteen.

We saw a rally one by and one. We've seen this throughout history. So it's not surprising at all to people who are students of the market.

So that sounds like the certainty is one thing. And I would imagine in your view and probably in wall streets view, that also translates to this election or the result of this election was not contested. IT was a clear winner and we didn't have issues with ballot boxes and fraud in any of these questions that would have caused some instability. I just want to confirm that kind of what you're getting out there with the certainty as well as the win.

yeah. And it's unclear that if he had won the popular vote and the electoral college, that we would have had the same amount of certainty as we had this time because it's very unlikely that he would have placed a concession call to her within .

twenty four hours. I think we can be pretty certain that he .

wouldn't have can see yeah so it's I mean, look at you got you really have to put your your feelings aside. Stocks care about earnings and interest rates, and we already were rally and going into this election and we didn't know who would win. What does that tell you? What does that we were hearing? It's a toss a coin to us and the market was writing anyway.

So what what the stock market really wants is not necessarily trump or or Harris or this policy or that policy, the stock market, uh, the part I shouldn't answer up and more vize the stock market. People in the stock market wanted answer. And whatever the answer is, we learn to live with IT.

We learn to make the best of IT, and that's what we got. guys. There was a five week period in two thousand where we didn't know if the president was going to be George w.

Bush or outdoor. And I know I know that sounds weird, but the worst, the dow Jones day environment was negative five percent. We didn't get a concession speech in twenty twenty from trump to biden.

And trump wanted to litigate the election. And we had that chaotic, I don't know, a ten week period into your end, eight week period into your end. And uh, the S M P.

Five hundred actually raley twelve percent from election night into the did you know that stocks one up on january six? I bet you didn't. okay.

So what i'm trying to what i'm trying to get to cross to the listeners who aren't from delia with the history. Stocks were hardly after J, F, K was shot. We're not emotional on wall street about our policy wants and needs.

It's about earnings and interest rates. So here is the big picture. Earnings, the rising and interest rates are falling. You you don't need to know in who wins the White house in that .

environment, just shows good to see you. So I am just I think it's incredible how prescient the market is meant. You said you pointed out that was rilling.

I think it's because the markets correctly predicted and felt to trump when and thought if corporate texes are going to go anywhere, they're to go down and learnings are going to go up. Meanwhile, the credit markets see him as more inflationary, and they started the chief investment officer. Millennia was the first person to call me and say he's won.

And I said, why you say that is because the ten you you're spiking the credit markets know he's about to be elected. Also, the markets are saying, as far as I can tell, that they don't believe the terrorists are gonna anywhere near as bad as he is threatening. Your thoughts on turfs and if the market is getting IT right? And if so, if these services that would be disasters for a lot of companies but the market to think IT doesn't believe IT, what do you thought?

I don't know if I fully agree that the evidence supports, uh, this idea that the Spike in yields is because of fear over inflation. IT might be I think we we don't have enough IT might just be because of a higher expected economic growth h scenario. Um but what we're going to find out together, the the great thing about market is, is that debate to irrelevant because there's a score board and the score board is what s up happening to to Prices.

Scott, I think you're right though. I think the markets did correctly pricing, uh, that I was gonna clear on in in trump's favor. And I think as evidence of that, this parallel story away from stocks and bonds with Polly market is really to me, one of the biggest stories of this election cycle. And IT.

Look, you could have gotten wrong and I wouldn't be saying any the things i'm about to say um but there is power in markets and people putting their money on the line rather than taking polls and until now this has really been something they've had in europe and not the united states and this is the first election where um people are really taking notice of predicted and really take notice of poli market and cause and all of these prediction marketplaces. And I think what you're going to see in the middle ms is an almost slavish devotion to what these uh, bedding markets are saying. I think the betting markets were so incredibly accurate on a state by state basis that everyone who follows the stuff is now sitting up and and giving these platforms a lot more respect.

If you remember the narrative the day before the election, people said, myself included, well, maybe we shouldn't put too much create in a marketplace that's really just Young men. Women are not betting on elections in in any real numbers. This is dudes.

Um so maybe they are over indexing to trump because that's what they want to have happened. I thought that too. I don't think that today we talk to investors about our investment physical hy, we have a deck.

And one of the slides in our deck um is the concept of the jelly bejar. The predictions are going to be much more accurate with thousands of people betting how many jellybeans are in the jar. Then one expert who happens to know a lot about jars and or confection, this is not material.

Ally different now, Polly, markets got the user base overseas. There are not U. S.

Hedge funds in there. There are not U. S. Retail people that are making investments in a prediction. Um so the one thing that you could have said is maybe that's where it's over indexing, where it's not picking up enough of the actual electorate that will change. So polymeric, interestingly, is based in SOHO in manhattan, but all of its users are overseas.

That sounds like a cyp to exchange, but but they will you going I think you're going to see a lot of evolution in these betting platforms. And by the way, when they all agree like it's a good sign for me, it's time to the time to shot the fuck up and pay attention to what the market is saying. IT doesn't mean markets can get things wrong. I think what that means is it's probably a Better system than somebody making phone calls to people's landlines.

What trends do you see? I mean, so certain companies are obvious winners and feels like test as a big winner. You think yeah hundred and thousand nine hundred million dollars to get a fifteen billion dollar pop.

And he added thirty billion to his networks.

H it's now thirty, thirty. O, thirty. X, that's the best trade.

Twenty four, right? So what? After the sugar higher, the obvious ones, like alternative energies, is not doing well, well and gas doing well. Some smaller companies that expose their immune to terrible doing really well. Those exposed to doing marginal, I would say, you know somewhat are modestly negative. If you look out over the next four years, are there any sectors you think people aren't registering or haven't acknowledged how well or how poorly they're going to do under a trumpet administration?

yeah. So I think the biggest question is the hyper scales. So but I want to I want to get back to that in the second the biggest reaction in the aftermath of the election was in bitcoin, the U S.

Dollar um and and small cap stocks. And if you look at the composition of the russia two thousand, the the biggest winners within the russia two thousand were regional and small banks. Um that sort of makes sense to me when you saw uh, the ten year yell explode even though it's been walked, it's walked itself back a little bit.

What that speaks to is higher at interest margins and and just a bigger lending spread and a belief in a stronger economy. And those stocks had been beaten up for like three years now. So relative to every other type stock.

So I understand that part of IT, we saw a huge rallies and industrial companies. I understand that part of the two um oil services stocks are the most interesting to me. I have a personal ownership in a company called Baker Hughes that broke out in a massive way.

We also saw the travel stocks explode, which was really interesting. Marriott, uh some of the bigger names in in in uh consumer to question ary or the travel companies. So the reaction was like really widespread.

Notably, gold fell, which I found interesting. I don't have a theory as to why, but IT diverged from bitcoin. Gold has been a huge perform or all year.

It's actually performed as well as the S M P five hundred, which doesn't happen every every day. Um but gold fell in in in the aftermath of uh, the election result. Um the other thing I would the other thing I get back to this is the hyper scales.

It's unclear whether or not j events claiming uh, that he's uh supportive of the work being done by linkin, who is abide a point in running the ftc. It's unclear if that jd events improve. Ter is gonna enough to dissuade trump from getting rid of everything related to biden that he possibly can.

Uh, SHE doesn't have a lot of friends on the right, obviously. And um the only thing I can think of is j events may be telling truth. No, actually this is good.

We want to keep the pressure on these guys for the next four years. We want to give them another assailant. Doubt here are that they can expand their time and energy um fighting against so that that was kind of like an interesting idea.

I don't know where the relationship between zuker and trump stands. IT was not great in the first term. Um I think we all know uh bezos is not the CEO of amazon but still going to always be the first thing that trump associates with h with bessus.

Uh so we don't know where they stand one hundred percent. We know that there was dissatisfaction on the part of the trump campaign with the treatment of search results on google. It's an open question how we'll be dealt with.

The one thing I think people feel good about is that tim cook knows how to handle Donald trump. Tim cook went to the White house. He did the photo ops, he did all the things that he had to do. And apple got itself an exclusion from the tariff s that would have really harmed the making of phones overseas. Um i'm guessing tim cook has a playbook for this, and i'm guessing investors are willing to give him the benefit of the doubt that he will escape through another four years of trump on skate.

One of the other winner we are just mentioning there are small cap stocks. So there are of two thousand jumped nearly six percent right .

after that was the bigelow action .

biggest reaction. Um i'd love you get your take on one why exactly that's happening right now and to whether you think this will be a long term trend. Because what we've seen over the past several years is that kind of the rich get richer among the stock market.

At least it's the big players. The max 7 that have been wicking in the small cap stocks have been kind of left behind。 I wonder if we're going to see a reversal of that term.

I won't bury the lead. It's not going to be long term trend. The history of small caps versus large cap is one of isolation. They have these periods where small caps outperform, followed by these very predictable periods where they under perform, and then the cycle begins new and that all this will be no different. We saw small caps reliance twenty seventeen as part of the coron court trump trade.

There is an idea on the part of acid allocators that high tariff s represent an opportunity for smaller businesses that are more domestically ally focused. Famously, the S P five hundred drives, I think, double the venue overseas than the rosell two thousand does. So there's an is an idea that these are companies that will largely be unharmed by uh tariff s and might even be helped if they've got on shore production.

I don't really believe in that. I think that people taking a narrative and forcing IT into an investment strategy. And I think if we really have twenty percent twenty percent hours around the world, sixty percent hours on china, I think small companies will be equally uh, acceptable just just as uh, the larger cap companies are. So I don't think the invitation with small caps well.

why why I I because I I buy that nature when I when I heard that too. I mean, if you're more domestic focus, if you supply chains in amErica not paying attacks, why? Why is that not .

compelling to you? Go look at twenty eight, when the tabs first went on, we had two in one year, we had two twenty percent little mini crashes in the S. M.

P. Five hundred. And ask yourself how the small caps do. In those moments, they did not hold up.

They were not a safe haven, and people were not making this calculation with their money. Oh, i'm going to sell us in peace talks and buy these little pieces of shit. It's just it's not the way money managers actually react with the dollars that are entrusted to them.

So I don't if we didn't see IT, then we are not going to see IT. Now that's one. Two who are the customers of small cap companies, large cap companies.

So if so, large cap companies are struggling because of tar fs, they're going to spend less money and they're going to buy less products from the smaller poly solids. It's not going to play out that way, but I understand the rally, it's important to point out. Um so the Russell two thousand just takes the two thousand largest market cap small companies, and it's a little bit random of what's in there.

The the S N P six hundred is a Better index to follow. So it's just a competing version of small caps. They're all profitable to get the S N P six hundred. So you have less little tiny biotech companies with no earnings.

You have a higher amount of industrial and and financials and that index um that kind of I think what you want to watch, if you're all of a sudden get into a tariff situation and you hear cees of those companies coming on conference calls and crawling about what a windfall they're getting because of tariffs, i'll be wrong. I'm telling you right now in uh, november of twenty and twenty four, that is not going to be what we're saying in november of twenty twenty five. Stay with us.

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We're back with property markets, just want to pivot to crypto, which we briefly mentioned that her bitcoin has hit more time higher, broke past eighty thousand dollars for first time ever over the weekend. And the expectation is just lack a user nicer regulation. But trump has also spoken about building this national strategic bitcoin stockpile is exactly the what he used when he gets into office. And with my for my conversations with cyp to balls, that's really what they seem to be most focused on. Um your view on bitcoin right now and is this huge rally warrant ted to think I don't .

know if it's warranted because I don't know how to I don't know how to judge where the Price should be. There no cash flows. So I can't say, oh, here is cheap.

Here is expensive. I just I try I try to avoid doing that. The only question that matters with bitcoin is are more people going to want to own IT or less people six months from today that nothing else really matters?

Um and when you think of IT on that basis, watch mock would have sold IT at seventy thousand after on the on the heels of that electoral selling IT to do what like literally what are you doing with the money I hope you're eating with IT because we basically have a bitcoin president coming into power who has largely been financed by bitcoin billionaire. They have his full attention. And just instinctively he doesn't have to understand anything about how blockchain works.

All he has to understand is there are rules, and these people are against the rules. Well, i'm with the people who are against the rules because they are rich and they flatter me and they're gona support me in the new terms. They got where to shit Brown in ohio.

This is the senior person on on the stand of banking committee. They throw out IT didn't even cost that much. I think IT was like twenty thirty million dollars uh so he he's not stupid. He understands that he should be listening to the cyp do people and he's going to and I think the the tacit support on wall street and among the institutions um Larry think at backdrop that's gonna turn into a full fledged order for the age of digital assets.

And if the government decides they have two hundred and eleven thousand bitcoins right now, federal government, if they decide that this is a new reserve asset, well, what do you think central banks all over the world they are going to have to do? What do you think foreign treasuries are going to have to do? They're gna have to pretty much fall in line. If we started start piling bitcoin, that's, of course, what everyone else is going to start doing.

So for then they'll start getting rid .

of the dollars, right? Maybe I I think the bigger thing to think about right at this point in time, who would sell IT, who would sell IT right now, understanding that this might be a thing that the federal government decides they want to buy more of. So the people within the trump campaign, we're saying a million decode.

I have no idea if that's realistic. If IT is uh the Price is not going to be Price is not going to a be sober one hundred thousand dollars for for very much longer. Um and I think everyone understands that.

I also want you guys think about, uh, the chase, because if I went bitt, coin breaks one hundred thousand. Every asset allocators in the united states that's ignored IT or avoided IT or talk or talk down about IT really is gonna forced to rethink whether or not they should uh do what the U. S.

Government is now doing. So this is one of the most incredible stories in the history of markets. Three years ago, they were arresting people for dealing in crypt.

u. And now the U. S. Government may end up becoming one of the biggest regular purchases of of of crypto o and H. I don't make anyone. In the fall of two thousands twenty two, when they were arresting a same bank man free, could have pictured a one eighty, to this extent, taking place just a couple years later.

Distinctive from spain. Cy, are any sectors you would stay away from? You think that these things are overvalued or they're gna face .

microsoft if you an mosque weren't in a position to pull his chair up to the desk in the youthful office, which so i'm telling people that I think we're going into a new robber baron age. The parallels between what's happening now and the late eighteen hundred ds should not be lost on anyone. We are probably going into a robber barren age where very, very smart, very wealthy people have the most influences.

Their influences is gonna trump, the evAngelical. No intended or maybe did their influence is gonna trump um the anti china uh wing of of republican lights. They are, I think, going to be at the center of all of the decision they can going forward.

I would have ordinarily answered you a questions got by saying solar and evs. But again, elon moscow's a solar business and an EV business, and I just don't think it's gonna be as simple as we're for oil and we hate alternative energy sources. I just I don't think I will go that way.

So i'm not sure about any industry in particular other than media in media companies are too well and truly fucked for the foreseeable future. These fantasies that all of a sudden were going to have mergers and uh and a and Warner brothers is going to be able to find at the al and you know netflix is going to start buying lions skate. None of that's gna happen um because I don't think any traditional media companies will have paid uh enough guilty to Donald trump personally.

We know he's willing to lap and eyes these agencies are against people who he uses being against him. So I just I like if I were trying to think of an industry, this is smaller than a sector you have. Sector is in any of industries or or sub industries.

If I were trying to think of a sub industry that could possibly be the most flat on its back right now in terms of what's about to happen, I would say traditional and door mainstream media um this is not going to be a repeat of twenty sixteen where everybody subscribes in the york times I think there is just A A fatigue about anti trump news. I in twenty sixteen, everybody wanted to subscribe to the washington post in the times because they wanted to fight back and they were and they wanted to hear every outrageous story and they wanted to be armed with information. I have to tell you guys as somebody who walked outside of my door and talks to people nobody wants at this time.

do you think we'd trumped being seen as sort of anti regulation or not involving? Probably they have to see the D. O, J, even if they lead. Leave lennon on in position. Do you see a lot of mergers and consolidation coming down in media given the stressors you're talking about?

Where are they? They've been on they've been on hold a they've been on hold for a while, and it's unclear who is going to acquire these assets. Well.

you don't see a Warner brothers during a stock deal for some of the other smaller players.

I think they would have like to emerged with paramount, but they're not in a financial position where their own are. Holders would think that makes sense. So and and who is big enough who is big enough to absorb the forty billion dollars in debt? Sitting on the the books at Warner brothers, almost no one.

So they they have, I thinked done a good job at, uh, repaying debt because I think that number was closer to sixty at one point. But that's not necessarily gona change the calculus for who wants to own that stock. You you you don't have you don't have the growth if you've got hit or this box office.

Look, I love eight dollars stocks. okay. I would love to say that the bye. It's so hated. It's so it's it's like a it's been so asta sized from people's portfolios that IT most might as well not exist Normally. That's a great set up.

I just think uh, this fantasy whether republicans are going to allow three trillion dollars in ma, which is uh, what we had in twenty twenty one this year, were about one point six trillion and ma. So this fantasy y that like next year will going back to three trillion and all these media companies are going to find dance partners. I just I don't think that it's going to work out. I reserve the right to change my mind but for right now I just .

can't Peter IT I do want to get to go back to this robber barren era that you just brought up um which I totally agree with um I think that would be a very good bet to bet on Donald trump s friends right now. Do you have any larger economic concerns about this though?

Well, I think we've had periods before where uh, business interest had outside influence on the White house. I really don't think it's it's a new concept in american history and I think of I think of this as kind of a pendulum and IT could be a while before IT swings away. I think the next four years, what you're gonna is, is the rich get richer.

I think you're going to see an explosion and demand for people who do what we do, which is wealth management. I think more people are going to come into uh, the wealth management industry looking for help and have ever come before um this keep in mind this is coinciding with a just gigantic wealth transfer from the bombers to janez and millennial. And know, I really think that we're just in an error where smart people are going to stop worrying about all the headlines every day and all the outrage and every stupid joke that every stand up comic tells in front of a mike.

If if that's how you planned to spend the next four years, I I just would say just maybe rethink IT, spend the next four years, put your head down, make fuck and money, focus on how you can improve your own life and the pendula will swing back. And if you're horrified by some of the things like the overturning of rovin wade or the way we're going to see very cruel um deportations uh uh of of uh immigrants, like if you're half ed by those things and rightly you should be, the wealthier you are, the more opportunity you will have to do something about IT screaming on twitter, crying into a tiktok. All that does is make the people on the other side, uh feel even more involved.

They love the winning and crying they're feeding on IT. It's it's their energy source. So if you are very manly antitrust, but I know people who are, of course, I live in new york.

If that's what you you're about, my devices ARM yourself with money. IT is the only way to make change. You don't have to like that. What i'm saying is true. You just have to accept IT because everyone else has.

Judge Brown is a cofounder in sea of rita wealth management, a new york city based investment advice reform, managing more than four .

billion and asset, five, five, five, five.

Bio updated, five billion in assets. Did I get IT home on? I just got an update at five point two in assets for individuals. Corporate retirement plans and foundation justice are always hugely popular segments with us. We really appreciate your time.

I love chatting with you guys. Thank you so much.

This episode was produced by carmilla and engineer by bench encor. Our associated produce results in vice message. Varia is our research, aline is our research as is our technical director and Kathy dolan is our executive producer. Thank you for listening to profit markets from the vox media podcast network. If you like what you heard, give us a follow and join us for a fresh take on markets on monday.