12.11.25 Subspaces

Good morning and welcome to good morning and welcome to subscriber spaces. We are currently getting a signal on the recording and this could be the Genesis episode to be able to go up into the cloud and then have that instead of just a test be available and then we could try to see about getting the legacy subscription spaces recorded and transcribed as well. I am delighted to be with you this morning. This is an information only space that don't make a transaction by a professional advisor and I'm not your professional advisor. So everything's changed now. Everything's changed. It's become nearly impossible to be a rational person and think that rates are going to be going to 6 and 7 percent. We are now in an environment where we're back in quantitative easing. We can call it whatever we want but when the government is using the power of the balance sheet purchasers to create excess liquidity to allow transactions to clear more smoothly it's a difference without a distinction and so what happens when a price rises above someone's exit if let's say they're short a position? They have to close it out. They don't have to close it all out in one day. They have to close it out. It's not as if they're not going to close it out or they are the kind of person that would blow up, right? So we're not talking about irrational people. We're not talking about toddlers and stackers and the people with anti-alpha and the delusionalists. I mean I had a long discussion with someone yesterday on an open space about at what level would they be concerned? Their number was 42,000 which is what's 75% lower than now. What would be the crime about reducing the position by 10%? 25%? If you saw something is going from a hundred to 26,000 straight to a million or 10 million what will be the difference in your lifestyle if you let go of 25% of your position? So instead of being worth a hundred million dollars, a billion dollars you're worth 750 million? It's so dangerous and I focus on it not because it's Bitcoin. I focus on it because it's all price structure. You have to reduce the friction of your holding to the appropriate level of your model for what you expect to happen. Because markets are just going to move faster. The friction of capital is called the Pascal seconds of viscosity. The friction of capital is decaying. We saw in Silicon Valley banks evaporation overnight. So I harp on Bitcoin only because it's the most acute example. It's the highest which is a German phrase or partially talking about the thing. If something is moving up twice as fast as something else or two times the speed, then if it has to change direction, it will lose its velocity. I'm trying to create the, we are creating the innovation to help illustrate this. If you have a railroad car, excuse me, an amusement ride, roller coaster ride, and it goes down to a trough on its way to climb the top of the peak rise, the peak height. And you're directly in front of it. And it's kind of later at night, you got a blue light, and you got a red light, the blue light's the front car, the red light's the back car. As you go through that last trough, it'll look like the front blue dot is going down even though the red and the red dot is following it lower. And then it'll look like the distance between the blue dot and the red dot is compressing. And then all of a sudden the blue dot will be rising faster. You'll get to the top of the apogee, the peak of the roller coaster ride, and then you'll start to see it compress into the red and eventually go lower than the red, and then the red will follow. And if you just saw, like on a oscilloscope, just lights going up and down, without the context, because it's at night and you're straight ahead, you would think it's just some bizarre function. Once you turn on the lights, and then you rotate 90 degrees, and you can see it passing in front of you. I'll tell you, that makes a lot of sense. So when I see Bitcoin, fail to make a high for two weeks, forget two days. Okay, we're always watching the price to fail to make a new directional extension, a new high, or a new low. You have the yield peak of January 13, 2025, induced by policy liquidity of the extensive cuts that have never happened before. Just before an election, essentially 75 base points, understanding that the 25 movement from the 50 up to the 75 evening of last year happened the day of the election, the day after the election, but the positioning of the liquidity was there. Who set the cut to be on the election? It's 75. And then you see Bitcoin, you know, react. People say it's Trump. Oh, it's Trump, Trump. It was mostly the liquidity. It's mostly the dollar suppression. And then you go up to four days shy of four months. September 18 to, to January 13, five days less, let's say 91 and 31 is 122 minus five, so 117 days. So then normally the treasuries will peak in yields. Stocks will keep on going and Bitcoin should have peaked after stocks. Guess what? Six days after the yield peak, you already saw a lower yield peak. It was a 10-year yield with a delay peak. That's mortgage dynamic. And then Bitcoin's negative divergence with respect to its lower eigenbasis, it's more sensitive to policy than the NASDAQ 100. So aggressive traders out, they're already shorting. An hour after it stops going to new highs, they're already, you know, trading in, trading out. Then a day, then two days more. We're back at two full weeks. Just like on September 18th. We had two full weeks of Bitcoin divided by its own volatility. Not some independent thing with higher inconsequentiality, less correlation. Like a Bitcoin divided by NASDAQ volatility, or Bitcoin divided by treasury volatility. A Bitcoin by its own volatility. Peaked at 700. Two weeks and four days. So two full weeks, you were warned of two successive non-confirmations of Bitcoin's rise. So Bitcoin is rising, Bitcoin divided by vols rising, and what I'm telling you is, Bitcoin's going up and it's stretching, it's expanding, it's experiencing higher entity, higher volatility, higher expansion. You're pulling apart the rubber band with one hand and a friend of yours is holding the other rubber band, and you're just stretching as far out as the two of you can go. And then all of a sudden, you know, that's one way of looking at Bitcoin from its August 2nd, 19, excuse me, August 2nd, 2023 level, Bitcoin is 25, Bitcoin vol is 31.41, and the volatility, which all vols do is naturally fall, unless they're suppressed for a reason. Like, the example we're going to be seeing, which is why you're on subscriber spaces, is to hear both what volatilities I think are going to be rising, what I think are going to be falling. You could adopt them as your framework, what you want to do. And then, which tail looks like is emerging from that evolution. Because volatility is a quadratic, it has two tails, it has two solutions. And it's not so erratic that it excites from one tail to another tail, that's not, that's not what you'll notice observationally. So you get to 31, okay. And then what happens is, you get a liquidity event that pivots to a pause, excuse me, in June, and then you get a, you get basically what looks like the final meeting, the ability to pause, and that was enough. Bitcoin goes up 400%, Forex, and it takes up the vol. Because there's not enough stock, there's not enough stock, there's not enough Bitcoin. You've got to create the Bitcoin. You've got to squeeze the deal of the system, the structure, you've got to cause those virtual coin supplies to implode. And that's what's happening. So then, we get that peak, 186, and vol starts coming in. And vol goes down by 70%. So what's happening is vol goes down by 70%. Volatility. So your denominator is going down by 70%. So your numerator is going up by 1 divided by 70%, which is about 1.5 plus, 1.6. So the decline of the volatility itself was worthy of a 160% of the expansion. Who is this? Okay. Okay. The Time Person of the Year. They have, Time Magazine, whatever. Big waste of time. Okay. So getting back. So then, you have the vol really compressed, and so you have people, essentially, the system, it's like delta hedging. You have vol going down to a minimum, local minimum, a local vacuum, a local low, and you have Bitcoin continue to go up. But, what's happening is, Bitcoin isn't going up as fast as its volatility is going down. Okay. So then, all of a sudden, you no longer have that expansion of Bitcoin running ahead. It's got to come back. It's like a bungee. It's got to come back to the volatility. And that's where you start to see the rise of Bitcoin vol. Why? Because people are trying to get into Bitcoin. They're buying vols. People are trying to hedge their buying puts. They're overpaying for them. And then you're causing, you're causing a rollover in that measurement. The Bitcoin using itself as a denominator. And that's telling you you're losing liquidity. You cannot just buy Bitcoin on leverage, which is funding it by showing the volatility. That's normalizing. And that is a massive disruption of momentum. And again, it's not about Bitcoin. It's about every asset class. We want to learn about this to see S&P VIX. NASDAQ VXN. We want to see this phenomenon in the 40 trillion NASDAQ as NASDAQ, in my base case, melts down enormously. Okay. And then we're going to have the fact that NASDAQ is cyclical. They make you think it's growth. It's not. I'm old enough to remember a 10 multiple on Apple and a 10 multiple on Intel, and people said that was too much. And they were 5% of the size. Who knows? So, the exercise in Bitcoin is only because it's now. It's our petri dish. It's our opportunity to visually thought experiment. And to see in real time. We don't want to do an autopsy on the greatest opportunity of the NASDAQ reset. Then, we want to do it on a cousin, an eigencousin, an eigenbase. We'll get that information. We'll get that skill set. We'll get that technique. We'll get that technology. We'll get that training technique. And we'll be able to apply it to a large degree. You've got to do the work. You've got to do the framework. But you've got to learn how to see this, because then you'll never unsee it. It applies to everything. It's a mechanical model. It's a measurement. It is just learning how to see nonlinear. It is very difficult, folks. Don't get me wrong. Don't think about me describing it as, oh, this is so pedestrian, so easy. How could you not get it? It's the most difficult thing. You're not going to find 1% of people on Wall Street who figure this out. They can't understand it. It's going to take you days and months. It'll take some of you years. It's like anyone who knows how to surf. Okay. You've got one moving part. It is, you know, the board through time with you. Okay. How about windsurfing? That's harder. How about parachuting? Where you've got to generate your own wind force when you parachute. Folks, those are difficult things. You've got gravity applying. You've got balance issues. You've got uncertain sources of force causing you... This stuff is, it's very stable in local time. In acceleration, centripetal acceleration, going around a circle, if you break up the time into small, small pieces, it's like you're going straight, and then you're just in the correct direction. It's like falling. So that's why we're going over Bitcoin. Not because you're ever going to make real money in Bitcoin. I mean, theoretically, if the base case is that you cannot innovate Bitcoin away in 25 years, because there's so much structure in it, the adoption will be, you know, so extreme it might take 50 years or 75, and possibly 25. But it's not the base case. You always have to have a base case and multiple standard deviations around it and go with a divergence. So I think that he could take Bitcoin towards currency volatility, which is sick, which accommodates a third of a set move, less than a third of a set move in a day. And it just fills up an infinite supply of liquidity that will fund it. Like currency. And carry. And then, because I don't think it's a currency, I think it'll just, at some point after, it could be a decade or more or less, just have all this leverage against it. And while it's kind of sliding higher through the ether, which they thought used to be the median, oh, we got some data. They'll have to upgrade Atlanta GDP today. If they're doing an update today. So you have a little softer labor. That will be supportive of rate decline. We have the 10-year. Where's your recession now? We lost the 1.9 on continuing play. People are losing their minds. How do I price in more cuts? How do I do QE? We are $10 billion off of the trade deficit. This is my hardest work nightmare. More growth, less inflation, less unemployment. Aye yi yi yi yi yi. This is all tariffs, folks. This is coming out of Japan. This is coming out of China. This is coming out of Europe. And they don't want a cut. This is coming out of China. This is coming out of Europe. And they don't want a cut. This is coming out of China. This is coming out of Europe. And they don't want a cut. If you look at it, yes, we are 50 basis points higher. But if you go to the second cut, that's already absorbed. So what happens when we get rid of another 50 basis points? We're going to have three years of a bull trap. How fast are rates going to fall after a 360? That doesn't, he doesn't even mention. And again, this is Jim Cramer, Rick Santelli. It gets me sick. Okay. Wow. 99,000 down. Wow. Wow, wow, wow, wow, wow. That's unbelievable. Mortgage rates. Where were we yesterday? Everyone's got to go on Mortgage News Daily. Put it on your home screen. Download the app. We closed at 6.30. We're up 19 basis points from the September 18th. You can do charting on there. You click on a rate, and you click it again, and it gives you the chart. Okay. So we are 19 basis points higher, and we have how many more? And 50 basis points. So 31 basis points are tightening. Okay. And that's with a Fed rolling off, continuously. Okay. But what's the problem? We have a lower base rate. Five and three-eighths. Three and five-eighths. You see that, you know, parallel to 175. Lower. We don't have a trillion dollars of roll-off. They just won a $40 billion buy program on shorter rates. Three years and under. A thousand days and in. Notice how they're focused on a thousand days, like we're focused on a thousand-day reset. Okay. So Bitcoin's under 90K. Again, I am not trying to make you Bitcoin traders. I'm trying to make you Bitcoin observers, whether you ever want to trade it in it or not. I want you to see that as a framework. It's a $2 trillion price in a $3.5 trillion wrapper inside a larger equity environment. But we have 100,000 fewer people on the continuing claims. We have $10 billion extra GDP. Excuse me. What am I talking about? Exports versus imports. They're going to take us back to 4% on growth. I think we were 3.5. That's a big number, folks. Let's just check the length of GDP now. Now, okay, we're 3.5 and they say we're going to come back today. So we're going to get nothing. So they'll take away a little for the weekly. They can add a little for the continuing. Because remember, continuing claims, that's 100,000 fewer people on the government dole getting, you know, uncompensated transfer payments, meaning the economy's not getting any productivity from them. Yeah, they're spending their money and that's, you know, borrowing and spending, but it's not the same as if the government isn't doing it, but the private sector's doing it. But wow. Wow, wow, wow, wow, wow, wow, wow. You're taking us back. You're getting rid of all the COVID imports. We're getting our jobs back. The initial claims, you have a seasonality. We were 191. That was 30,000 life. And now we're, you know, you average the two, the 191, 230-something, that's like 210, 215. So Richard Clarion, one of the least competent Fed presidents in a long time, he's now global economic advisor for PITCO. Let's listen. Okay, so... Okay, so this is a guy who shows that he was never worthy of the Fed. When you print the boatload of money, okay, and you lengthen an economic... Okay, when you print this money, when you lengthen the wavelength of an economic cycle, I mean, this is a discussion I had with one of the people I just onboarded to QH.net, is that when people say, oh, this time is different, we have earnings and more robust companies. No, that's a true statement out of context, though. What's true is that, yes, what you spend is growth and more robust, and it's lower PEs than the value in 1999, but Greenspan intentionally allowed the yield curve to flatten, allowed banks to stop lending as much, allowed the NASDAQ to roll over at 139 times GDP 1.29, and this time, every time we had a blip, they got 175. QT is another 90 basis points in my world. That's 265. And then we just hit 40 billion. That's another 40 basis points. Okay. It's like 300. That is going to get you growth and people thinking the ecosystem is stable, and they'll make the orders, and those orders will be XYZ. Well, guess what, folks? That party's ending. Right? When we take out the lows on the three-year, likely because the Fed is just buying too many of them, we don't have enough of them, and now the Fed is buying them, why doesn't Powell shove more down Powell's throat? Why doesn't Desmond shove some more three-year down Powell's throat and take them off the bar? Right? Why not? I mean, we've got this beautiful, this beautiful GDP number. During the shutdown, during the shutdown, we have a beautiful GDP number. We're going to get a GDP number like this. It's called Paris. Paris in a world where everyone needs us. Paris in a world where we've been the victim of other people's revenue. And now, the IMF says China's growth is currency-based. And part of it, part of it is they impoverish their people so that they can compete and interfere with an economic cycle so they can be mercantilists. And America just said, no. America just said, stop in the name of sentinel deaths. Stop in the name of hopelessness in America. And you have the Wall Street Journal, Trump's nemesis, practically, who made up that Jeffrey Epstein nonsense. It is terrible what Epstein did to these girls. It is evil. And if the Biden administration had one shred of conflicting data that was adverse to Trump, they wouldn't have needed to make up stuff like Hillary Clinton laundered money for a law firm. And called it a legal offense. And she got an $8,000 fine for election activities laundered through her law firm. $8,000 fine. Trump gets 190-whatever convictions, which will be overturned because you cannot have a combination, a dual-component conviction where you don't have unanimity of the second component. That would mean he was unconstitutional. But they got the opportunity to say, ah, he's a criminal, let's take him into the dock. Okay. So, here's Elizabeth Warren, Pocahontas, who, everyone will remember Charles Ogletree, he was the black law professor at Harvard Law who mentored Obama and created a president of the United States, in part. He gave him direction, structure. Without Charles Ogletree, I don't think Obama would have ever been president. He was mentored by him. He was organized, he focused him. Elizabeth Warren stole a minority chair. She did hang out with Puerto Ricans and black people and people of color and mentored them like someone who was an equal, someone who experienced their struggle. She's from Oklahoma. She's paid. And she got a $2 million loan and all this money. I don't want to hear anything that crazy. And she's my senator. Or she's a senator for one of my properties. Can't stand her because she's a lying cheat. She never gave the money back. She never admitted what damage she did. I think it's so important for people to mentor people. And people... Trump caused chaos with tariffs. This is the word coming out of this crazy, psychotic mouth. We just got rid of $10 billion worth of imports this month. What is the matter with you, you freak? These are American jobs that you're not exporting. The economic chaos is what's breaking the back of inflation, what's breaking the cartel of imports. You're so dumb, Lainey. It's not keeping interest rates higher. Powell's the one who's not lowering rates because he finally admitted yesterday tariffs aren't having the effect they thought, that they said they wouldn't do again. Actually, this is from 2018. These people, they boil my blood. They boil my blood. She's shaking her head left and right because she's lying. And she knows it. Okay. Oh boy, what a crazy midterm we're going to have. What a crazy midterm. Okay. So where are we? Let's check rates. Let's check rates. Yeah, we're minus 5.2 on the 5-year. We're at 3.703. Okay, what is that? Because that is 2.8 basis points above the Fed funds rate. The 3-year is converged, and it's now 3.8 basis points above the 2-year. Again, folks, we're looking for sections of the yield curve to flatten. And now we're only at the 1Z, 2Z. The 2's are under the 1. We're back at .38 higher from the 3. But the 3-year is below the Fed funds rate. The lowest rate is, when it's above, it's still above. There's still net credit demand more than supply. It's a positive downturn structure. We're down. And let's see. Let's see what happens. We're at 12.9, 4.129 on the 10-year. And this will start to help bring mortgage rates lower. So let's see how long we can get this. We've got the growth. We're going to have more taxes. We're going to have more, you know, ironically, the lower the deficit, the less the tariffs we collect. Right? Because it's a lower share of total consumption. Oh, Kevin Hassett's a big concern. David Zervos. I would love it not to be Hassett. I would love it to be Zervos or some other person. He is their, you know, that, what is it, raging bull with De Niro and Joe Pesci, I think. Do I have that right? Where he says, like, he's got a bruised or broken rib on the right side, they put him in the orphanage, so to speak, on the left side. And that was to shoe polish. To cause the other guy to think that that's where you're vulnerable and to target the frailty. So, Elizabeth Warren, that smirk. He's never disagreed because his job is to advocate for Hassett. Okay. So, let's check some of the equity indexes. Where are we? Okay. Okay. So, in that section, I have 55 basis points. The S&P is 37. So, that is an 18 basis point. High-end basis compression. Oil, we didn't get the chance to talk about it. Oil is now at the lowest monthly close in more than four years. And at $57.48, we're a half a dollar from the lowest weekly close. Okay. Do you know what my brothers and sisters in paper oil, the 50 times the physical oil, I keep on saying to people on Twitter, they don't want to listen. The oil experts, the physical oil experts, the guy who's always on the morning show. He says, there's a shortage of oil investment. There's a shortage of oil. I wrote a big, long paper on floating oil to fake news or something like that. Where's oil going? Because paper oil is five billion barrels a day across the world, different exchanges, options. Physical oil is $106. You can just sell oil futures. You don't mind losing money if you're buying three or no futures by a factor of 10 or 20. Why? Because lower oil will lower the data and the data will accommodate more low rates. And then you'll make more money on the other side. If we lose that, you're such a liar. You lied about your background. You knew it. You were just an also-ran, nobody, academically. And you went to the highest quality law school in the world as the minority chair. You never apologized adequately for it. You never gave back the money so that another mentor for people that need opportunity. Okay. So, we are watching for deteriorating volatility in Bitcoin, in treasuries. In mortgages. I mean, they're actively trying to keep mortgage volatility up with a massive roll-off. What is the genesis behind the QE yesterday? A secured overnight funding rate is a rate that's collateralized. It's supposed to be lower than the policy rate, the overnight rate, the unsecured interbank rate. But it's not. It's having funding failures. Okay. Anyway. Ay-yi-yi. Buckets. Stop. Stop with the hometown words. You fake. Anyway. Sorry, folks. I get triggered by thieves. HODLers and snakers are thieves in my book. Okay. Your job is not to sit and ride a price down 80 and find out that it goes down 98. What do you do? What do you do? Gabriel, thank you for rescuing me from my isolation. What's going on, Gabriel? Hello, sir. How are you? All right. So, you must call me David, Gabriel. Okay. So, David, my question is regarding QE. What is that by coupons instead of treasuries? How does difference mean? It's worse. It's worse. It's worse because when you're buying coupons, you're buying duration. You're destroying three times as much available duration. You're destroying volatility. When you're buying $40 billion in e-bills, it's $40 billion... What's the average life of an e-bill? Let's say six months. You buy a coupon, three years. That's real... Oh, we're buying $40 billion after three years. What if you bought for $40 billion in three years? It's a lack of transparency. When you're buying that far out, you're driving the whole rate structure down, right? You're going to lower the funding cost. It's more leverage. It's more torque, you know? What if they would buy $40 billion a month? That's more than the whole issue is in a month, right? Right. So, they're saying, we see a problem. We need flexibility. We're going out to make, effectively, we could buy $120 billion duration years in a month. $120 billion duration years. That means the Fed could fund the entire deficit in e-bills and there'd be no supply. The math doesn't lead that up to people, well, how could $40 become $120? Because you quantize things. Remember, we're QH, Quantum Alpha Generation Engine. When we talk about treasures, we quantize them into years. When you talk about mortgages, you quantize them into years. You say, what's the average life of all mortgages? Okay. And then you multiply by the average life and you get a total number. Then you divide that by your 10-year note future. And then you could normalize to a 10-year note future. You say, you know, 10-year average life, $13 trillion, that's $91. It's equal to $9.1 trillion in mortgage debt in 10-year notes. You take the marketable treasuries, that's $30 trillion times the six-year average life. It's actually 71 months, not 72, but that's what you said. Six times 30 is $180 divided by 10-year notes, that's $18 trillion. So you get $27.1 trillion 10-year note equivalent. It's a way of commoditizing and normalizing. So when you're getting a three-year, you're just by force, forcing rates down. They haven't even bought in one bond. One, two, three. Sorry. I always thought people would say, I hate when you could keep bonds in notes. A bond is, you know, covalent and strong. A note is something that goes out to 10 years. A bond is 20 or 30 years. Although in Japan, they start bonds at two years. It's crazy. But what you have is the buying of the three-year means they're just pulling the whole curve down. That means you'd have to steep it from threes to thirties to get that kind of steeper. And the problem is, and this is what we've been articulating, when the curve's inverted, you're going to get a lot of money supply, because you're not going to annihilate any in the fixed or floating shifts. When the curve is steeped in the middle of the range, you know, we're not even back below the 360 on a 10-year. Then you're going to have some annihilation of duration on the fixed or floating. It's a third. You destroy a third of the duration of a mortgage when you go to an adjustable. It could be more, but let's just call it that. So now we're at 8%. But as you go lower, and that adjustable is a clear reveal, you grow the market share. We were at 40 in 2005. So, if the three-year is being driven down, it's actually just going to give them the opportunity to cut later. Because they're putting, they'll be putting the three-year below the funds rate. Excuse me, the three-year is below the funds rate. They're going to drive it even further below the funds rate. That's the point. The five-year is above the funds rate. The three-year is below the funds rate, and they're buying it. Maybe they say, but we're not buying five because we don't want to drive as far as the five-year below. But they're going to create their own signal. It's like a carrot on a stick in front of an animal that's, like, walking forward to get the carrot. Like, do they not get that they're not going to get any closer? You know what they say, what can you try going to as fast as possible and never reach? Tomorrow. You can never reach tomorrow. Tomorrow becomes today, you cannot reach it. So, they're driving down things that are already lower than the funds rate. And if they drive it down to 3.38, 3.375, then you'll have another inversion. Then you'll have another signal to normalize the curve they need to cut. But how impressed are you? Yeah, I mean, and what about the expectations about future rate cuts? I mean, they are not expecting 50 base points rate cuts in January. I mean, isn't that the other way around? Shouldn't there be a higher expectation for a 50 base points cut in January? No, for right now they're saying none. They're saying, let's take a look. So, we're at a 22% chance of a cut, 41.8% for an additional cut by March, or 7.8% for sequential cuts, and then April is 1.6% for three sequential cuts. But, there's a reason for that. And let me just check one more rate before I say what I wanted to say. What's happening is, what they're doing is they're flattening the SOFR curve. So, the Secured Overnight Funding Rate, which is a proxy for the Fed funds, according to many, they don't want to let the current rate go down. They want to let the longer-term rate go down a little. Because, as I said, if you measure, and I'll get this chart out, the relationship, the tension between the 18-month-out rate cut and the 10-year, it's about 120 base points difference with the 10-year above, and it's very, very close. It's within 5-10 base points. So, they're saying they're not cutting it now. That means the money that's going into the curve is going to buy the longer end of the curve with no supply. Because it's too hard to move something that's $3.6 trillion versus the longer stuff with no supply. I mean, just the last auction, the primaries had taken down 10%. The real consumers of that paper, you know. So, we're watching for flattening. We're watching for the mortgage rates to break down. You know, they popped the adjust rate back over $6.00. $6.02 was $4.00, $5.70. They just drove it up 32 basis points. It's quite a volatile series. There's a lot of activity there. It's not as easily hedgeable. So, I mean, we can look at the... We can break down the elements of what's causing rates to go down, but that's... I don't want to say it's intuitive. I don't want to say it's alchemy. I don't want to say it's expertise, but I don't want to say it's pretty low importance from a short-term standpoint. Rates are going lower, and we're about to surrender the rate cut level of September 17, 2025. It's more important to accept that as a fact than to do the thought experiment as to why. Okay. Okay. Thanks. Thanks. Why are you not turning on? Okay. Anyway, so we're watching for yield. We're watching the compression of the area between the market value of my U.S. treasury and treasury plus equity. And you've got 7.3 on the 5 here. The 5 here is now at half a basis point from the Fed Funds Rate. Oops. Okay. Yeah, 4.1, so we're two basis points. We're two basis points away from surrendering our local cut. And Rick Santelli, Cramer II, is saying we're up 50 basis points, but not the local rate function. It's disgusting to try to amplify fears, and this is before the Fed's event. So grotesque. So grotesque. So I hope you guys like San Martin Stable. Oh, you know what the problem is? Okay, why not use... Okay, so someone put out the chart showing liquidity and bank deposits. Okay. Okay, so Carol asked... Okay, let's answer. Because credit demand will not... Amongst investment rate. Investment rate. Okay. Okay, so let's take a... We got this. We got that. Let's see. Let's try to go over to Oracle. Okay. Oh, geez. They got these ads. I mean, I'm paying. I'm paying for your top service. Your second top, excuse me. Why do I still get ads? Oh, you know what? I switched my trade view to go around Apple, and I never switched over. That's why I'm still getting ads. I had a basic subscription. Okay, so... I'll put up the corrected one later. But now you have Oracle going back to July levels, the July breakaway. Okay. That gap is June. That's six months. Where's Microsoft? Let me, you know... Ultra bond is back at the five-day high or whatever. And that's the weakest. We can get lower moves today. The bond's down. The market's down, and the yield is up, so that's a bad sign for the market. Rocket's at 1984, trying to create a little cup-and-handle situation. XMH. What was it looking? Okay. Let's look at the bond. Bond's up 25 ticks. The bond just took out a one-week high. Going back to December. Okay. Let's see. How about the five-year? Ah, the five-year's very strong. The five-year's September final also. But, as I say, I have, like, the lowest yield on the curve, and it's longer-cutting. And you get a lot less volatility. And that allows you mechanically, it invites you to move down. You'll be able to move your exposure, what's working. FIG is down, not as low. Adobe CRM. FAT. United Health is up. NVIDIA's at 178. Let's see what that is. So, NVIDIA is basically $1.71 from the lowest close since September. So, you're not far away from, you're $2.00 away from a three-month low. That's supply. I don't know what these guys are going to be doing when the NASDAQ melts down most of the time. How are they going to look at it anyway? Okay. Let's look at... So, the low beta's doing all right today. They were hit out very hard. Low beta after last month's close. Because everyone said, hey, they're overpriced. Let's buy the good stuff. Broadcom is down $2.80. Tesla's, we don't comment on that. Apple's down $6. Google, NVIDIA's down $3. Microsoft, oh, it's up. It was down hard yesterday. It's near a... $4.72 is 2% also from the six-month low. Six-month lows are important. They have to be only a 52-week low. Amazon, $2.31. Let's do the... We were at $188.11. So... $188.11 divided by $2.31. Oops. $188.11. Come on. $188.11 divided by $2.31 equals... So, Amazon is 18.5% from surrendering all of its breakouts from 2020-ish. From most of it. That's not... That's going to be a lot of Amazon paper hitting the market. And people are going to be writing... People are writing calls. There'll be shorting skew. I got a lot of things to do today. I got to go to this property. Oy, yi, yi, yi, yi, yi. Oy, yi, yi, yi. Okay, let's take a last look at rates. Coin. Prices. Okay. A Bitcoin ball is down at... It was as low this morning as $42.55. It's at $45. Bitcoin is right at $90. I think the lower Bitcoin ball is, the easier it's going to be for it to go down. Because I think that's the tail. Gold ball is backwards 2020. Oil is down 2.1%. Okay. We are 9 cents. I'll put the top of the net. We're 9 cents above the lowest weekly close. Okay. Now... Let's see. How do we get this up? Right. Okay, oil is up to the next. Okay, the two-year is at $350.5. So, let's take a look at some of these yields in their context. Oh, shoot, I got a meeting at 12 o'clock. Okay, so the two-year is... Eight basis points on the close. It's nine. It's 9.3 basis points. Now, let's check the... Let's check the two-year. So, you've got, on the three-year, you've got 11.7. These are not big numbers, folks. Let's put this up on the list. Watch. So, David Faber is shilling for Netflix. He's trying to undermine the seriousness of Paramount's offer, because he's desperate to make sure that CNN doesn't go into CBS and have whatever his name is, who is running the free press, be in charge. Boy, the bias of these people for new phase lows. Okay. Post. Posting, and then we're sending it out. Okay, anybody want to make a final comment? I think we're doing an afternoon subscriber only today, because we're trying to help the West Coasters. Okay. Let's open the next, and... Okay. So, oil. Yikes. There's another one. Oh, no, I think that's not anyone. I don't think that's anyone. Oops, let me just check this. Recently saved. 2025. Yeah, no, it's not. So, you know, we're not far from the 56s. And how is this going to affect food prices? I mean, that was some strong GDP data this morning. I mean, it wasn't the GDP, but it's the component of GDP. A $10 billion chop-off of imports, of net imports. I mean, as the base case, you know, wow, wow, wow, amazing. Again, if you're creating some inflation while you're trying to neutralize deflation, that's all fine. We then have to make sure that rates go to zero quickly and that they cut taxes massively to make sure we're in this equilibrium phase. And that's what was offered. Okay, everyone, thanks for joining us. And I didn't plug in my computer properly. I ran out of power. Let's see if the recording helped, and we'll send it up in some minutes. Okay, good day. Good day. Thank you.