12.17.25.EVENING SUB

Welcome to Subscriber Afternoon Squawk on Polarity Radio. We're an information-only subscriber podcast, whatever. We're not providing advice. We insist that you use a professional advisor. And we're trying to help you get a framework to see risks that you otherwise weren't looking at to help you limit some of your negative alpha and to see the market in context. With that said, today, unfortunately, is an exciting time for members of our community that we're trying to grow. It's not that we crossed over 19,800 followers on our way to 25,000, 50, 100, and a million. It's that the market's getting more organized. It's less decoherence for people who are watching the organizing framework of the market. What is today? Today is a new low level of expansion or inflation of data or of tech, of AI. We are now lower. It's up in the mess. I have the chart. I put one of those OK, what do they call it, loops to be able to let you see. If you go back to November 9th, 2024, the AI inflation, we have now surrendered all of that. This is on a non-adjusted basis for what is almost a full percent of excess dividends coming out of the S&P versus the NASDAQ. And then next to it, we have the move index, which we should get at about, or the move index denominator in the bond index. And what that's telling you is the bond denominator, bond volatility is going down more rapidly than the residual parts of the curve. That's telling you that two-year no-falls is rising and siphoning the life out of bond volatility. That is not good for banks. It's not good for people who like to issue mortgages. It's a real piece of information. Let's take a look at what mortgage rates did. Wow, we lost nine basis points on the secured overnight funding rate mortgage. So, we're now at a 37 basis point decline, a differential, 5.9 versus the low of 5.59. So, we are 31 basis points above our low, but on the fifth, we're 16 basis points above our low. We are lower than last week by 11 basis points. And as I've said in my work, my understanding of the model-driven mortgage environment, we have a long way to go to tighten. Mortgage spreads can tighten 100 to 150, particularly if you go to lower and lower rates. We're getting a recap from Mike Santoli, who I find to be very harmful and dangerous. So, I'd like to hear what he has to say. Let's listen to him. There's two other parts of the so-called real economy. So, banks versus NVIDIA. And here's the big picture. So, you've got KBWB, NBDCF, or the KBWB bank index, which is really dominated by the largest institutions, like 40%, the big five banks. So, clearly, this is only in your big chart model. Multiple years of NVIDIA's way ahead. But, you know, NVIDIA is now at about a 20% pullback from its high. It also is trading at a broad market multiple in terms of full FTE. So, it's getting less expensive. Their earnings aren't going down just from people who are willing to pay for it. It's gone down. Now, take a look at another way of observing this, which is Oracle's market cap relative to Johnson & Johnson. They're leaning here right at a half trillion dollars. This was a massive, almost close to a trillion dollars for Oracle. You're excited about a state-of-the-art business. Now, that's almost all out of it. Of course, Sloan Fannie, J&J did nothing for years, and then has recently come back into favor. We were concerned about Oracle's balance sheet. They've got all this debt to do the build-up. And J&J has won only a couple triple A-rated credits still in the market times. Mike, now, traditional banks are the only ones involved in financing the AI infrastructure build-up. Are you seeing them, those stocks, influenced at all by that piece of the AI trade? And could that have something to do with the shift? Not a lot. I mean, certainly, I think the general aggressive capital-raising environment is helping the banks as an underwriter, not as much as a direct lender in terms of it being a large allocation to them. But I think you are seeing other parts of the credit market maybe get stressed in terms of how much capital is being demanded of them. So, private credit is, to some degree, maybe sort of the lower end of investment-grade bonds, and then some of these kind of special-purpose mutuals that are being structured to try to invest in data there. So, for now, the board of banks seems to be much more riding the wave of higher activity levels as opposed to, you know, them being real beneficiaries directly of the AI build-up. All right. Thank you so much, Bill. We'll leave it at that. Thank you. As I like to call him, Captain Pavlum. Anyway, Captain Pavlum is saying, oh, look, the banks are doing well, and they're taking the money from NVIDIA. Hey, genius, why don't you tell people that the moon index is melting down slower than TLT volatility, or bond vol? So, the recap, someone has the recap of, so, this woman, Allison, leaves prison after being part of the theft of $10 billion. We have a crazy world. Someone steals a shovel. They can get crazy. Wow, the last elite is a billionaire. He was on one of the flights. Okay. Anyway, so, basically, what he's saying is the markets are stalling. The banks have caught up to NVIDIA this year. Johnson & Johnson has caught up to Oracle. Anything that anyone could see. The problem is, he doesn't know anything. How do you say anything nice about a bank? What is a bank's job? A bank's job is their insurance against financial events. Their insurance against higher rates, against lower rates. They sell insurance. It's called volatility. Well, what happens when there are too many people selling the product that you're selling? The price goes down. And the profitability of selling volatility goes down. And that's what happens when you print a quadrillion dollars of money during COVID. We announced we're embargoing an oil producer. And oil's up less than $2. It's embarrassing. Anyway, so, the market's following Bitcoin's eigenbasis. We talked about how at the beginning of the year, January 13th, 10-year yields peaked. And Bitcoin peaked a month before the NASDAQ 100, January 19th, February 19th. What that means is you could have two weeks of failing to make a new high. And on the second week, you could say, this Bitcoin's in trouble. And then it went down to 76, or below 76, on April 7th. And a component of why I wanted to cover the short at 4.29 a.m., located in my highlights, notwithstanding the trolls that print me on voice, saying on April 5th I thought it was going lower. I did. And then it stopped going lower for then, so I flipped around. I'm not a hodo-emergent-ish. And then it goes up, and then we have another negative divergence, where Bitcoin isn't just not going up three times, it's not going up as much. So if you're looking at it head-on, it will look like it's not going up as much, and that it's less volatile. That's not at all what it said. It said that it's just as volatile, but try to look at it from the side. It's like a roller coaster, and it was leading lower. And now it's stalling, but what's catching down? The NASDAQ. The NASDAQ. So we had four days of NASDAQ beta deflation, and then yesterday we had beta inflation. What was it, 47? I can't remember. I posted this morning. But if you look as of the close, we are now at a reaction-low compression, reaction-low beta deflation, since the rate cut. We are now, as you can see in the nest, we are lower, we have less NASDAQ expansion versus the S&P since November 9th, 2024. And as you all know, the pin tweet a week after, we saw an inversion, a linear transformation. That was July 17th, a week after. Okay, so what do we have? We have the two-year yield of 3.485. It is not tightening up relative to the policy rate of 3.625. And as the two-year yield goes lower, it feels to us, you know, like... I was listening to my crunch report. Oh, as the two-year yield goes lower, volatility is going to pick up in the two-year. And where is that volatility going to come from? It's going to siphon it out of the move index. Okay. Someone says, I agree mostly in the short-term, but as the dollar continues to get printed, the return with interest rates will continue to erode in terms of itself. In the long-term, I believe the future will be vastly different. Governments, okay, you know, there's an individual sent a comment. I just feel pro-Bitcoin. You can be all the pro-Bitcoin you want, but it's going down in price now. It's difficult not to notice that. We had Bitcoin down, was it now 86? Slightly below? Let's take a quick look. Yikes. Okay. Commodities now. So, oil's up a whopping $1.45. That's ridiculous. How pathetic that is. And gasoline's up three cents, up $1.91. Silver's up five and a quarter. Copper's up one and a quarter. Oil's up $1.40. Gold's all hit top five. Silver's all top ten. Bitcoin's at 85,821. And there's all sorts of stuff going on. We are now at what would be the lowest weekly close going back, because the weekly close during the crypto mess was 86,803. Whoa. We just got a report from the amazing Gallico. Moved as a new low, as I projected earlier today. Let's just swing back. New five-year low. Five-year low. Okay, let's put that up on the net, folks. We're going to get to 50. We're going to get below 60 pretty soon. What I want to see is Bitcoins and up. Dehaul against move. That's going to be an interesting race. Okay, so let's get that move up here. Move, where are you? Is it over here? I put move in a lot of places. There it is. Down $6.56, $4.00. Let's put a monthly on. Folks, wowzy. We lost like .13. We're down 4. Where are we? We're going back to September. So, September 21. So, that's 50 weeks. December, November, 51 weeks. Okay. And the RSI of move is at a 38. How amazing. Okay. Okay, we'll do this to subscribers. Okay. So, folks, if the value of hurricane insurance is highest in August and now it's over, what's the value of hurricane insurance? The move index, volatility is coming in. What do you think you're going to see in terms of treasuries and mortgages? I see us going through the lows. I see us taking out the $6.11 and the $5.99. That's not going to be good for the banks, folksies. Not in my opinion. They're selling something that's going down in price. Just the inventory on their balance sheet is going down. And gold and freaking facts is going up. This is a crazy world. And I would be a buyer of it all this time. But now, I'm buying it on other people's crazy. Now, their crazy won't be able to sustain. We're losing volatility. Michael Saylor, volatility sellers have a problem. And a fat man can't run a marathon, but when you lose weight... So, let's start to watch. Mortgages do better. Treasuries do better. Banks do worse. And when banks do worse, while tech is doing worse, and then when the dollar goes up, you've got a delicious cocktail of chaos. And they're saying, oh, we're so lucky. We're able to buy broad coming down 20% in a week. Oh, yeah. Yikes, people. What is going on? Let's go take a look at our fade. So, Amazon is 220... It was up earlier. It was up earlier. 221. Okay. Let's go back five years. Okay, it's 88.65. 188.65. So, 221.27. 221.27 divided by 188.65. 17. So... So, Amazon is 17.3% higher than it was four years ago. That's not a great rate of return. That means if it goes down 14.7%, goodbye. You've surrendered. Okay. Okay. So... Folks, do you have any idea what a moving deck that was 200, a bond vol that was just 25 on liberation day... We told you it was a spoof. On June 27, 28, we told you the equity was a spoof. And they're talking about, oh, we had a six-month equity rally. We did not have a six-month equity rally. This is crazy. And I said on April 21, FANG suppression rally driven. FANG... A vaguely suppression driven FANG rally. I was expecting it to go up. But that wasn't... I mean, Alaska will taste Sam Altman's fables. Come on. Oracle is down 50% from a tie. Don't you think as these stocks start going lower, founders will call in their boards and say, cut it back, Jack. Cut it back. It's not pretty. It's not pretty. It's a great opportunity. Watching things get so incredibly organized. Oh, boy. Yep. And then the move divided by bond volatility, that's telling you that that's going up because bond vol is falling. We're running out of bonds. It's going to be amazing. Aye, aye, aye, aye, aye, aye. What's going on? Okay. Okay. Let's see. Let's just check some of these prices. Oh, so Amazon, you know, down on the year. Meta, the three on the year. Apple. It just looks like single digits for the tech. And now you have Nvidia down four. It's getting ready to get a three-month low. Okay. Oh, you know what? Let's put a united help to U-N-H. Okay. Anyway. Okay. Does anybody have any comments, questions, concerns, thoughts, anxieties, observations? Don't let a guy hang all alone. Let's see. Let's go on crypto. Let's see. Yes, XRP is getting dangerous for all reasons of danger levels. So, we are now at the lowest weekly, or is it the lowest daily close in a month for strategy. Okay. All right. Strategy is having problems. Okay, what's going on? XRP. What's XRP? Oh. Oh. Okay. Folks, we're losing equity everywhere. We're losing equity everywhere. We can get detailed, but we're losing equity everywhere. Bitcoin 85.78. Okay. It doesn't want to go above 74, 30, 42. I mean, you got a lot of stuff over here. You got lower highs. You got lower lows. You got a lot of intensity. But this is very right shouldery. Okay. Jose Caldera. So, I butchered your name again. Caldera. Jose. Jose, can you speak? Hi. Can you hear me? I can. How are you? Fine, thank you. How are you? Tired. How are you? Tired. It's getting so exciting. I mean, you know, we're getting the information. It's getting organized. I'm getting, you know, attacked everywhere. Just kind of. I'm not allowed to speak. I was disgusting for going on a site that didn't want to hear what I have to say. That's what someone DM'd me. That's crazy. Well, it's difficult sometimes to see the truth, you know. Well, it's expensive. Well, I would say it's expensive, but most of the time people don't want to see it because it's better to believe in something than they think it's going to be. That's just so crazy. It's just so crazy. Especially in reality. It's so crazy. The intensity of delusion is just amazing. Anyway, what else? What's going on with you? What are you noticing? What are you thinking? Well, I'm thinking this is really organizing, as you say. It makes sense. It makes sense. What I've learned, it makes sense. What I've seen, it makes sense. I just want you to, well, I saw the curve will slide based on... Outflows of data. Exactly. Exactly. And the reason is the direct transmission from equities to the bonds will be because they will have to take off the shorts, right? Well, that's an element of it, but really what it is is it's an intervega transmission mechanism. So, what's happening is bond volatility is particularly assigned against equity volatility. And so, as they reflate bond volatility, they suppress two-year note volatility and they suppress equity volatility. Well, what happens when bond volatility gets heavier? You see rising two-year vol and rising equity vol. And that's directionally bad for the market. So, we just saw the... I'm sharing the VXN TLT. That's the volatility index of TLT, which is a proxy for the U.S. Treasury bonds. That's melting down. That's down 60%. That's in the tens. It's like 25 earlier. And you know where that vol is going. It's going into the two-year. You're the only one that can explain this. And the amazing thing is we can see it happening, really happening. That's why you have to watch with me. That's why we're doing the animations. Like on my team. Believe me, I'm giving them a hard time, folks. Yes, there's animations. But it's the curve of the Treasury curve is actually controlled by the volatility curve. Because volatility conserves all the information of gamma. And the point is skew conserves the volatility. So, when they say, what are you talking about? Because I'm not nervous about a call that Bitcoin is going down a decimal or two. I'm not nervous. How are you going to take something down 76% and get it up enough that it's going to scare somebody? And when you get Bitcoin volatility down at, what is it, 45 right now? Let's see. 47. Ooh, congratulations. It was 45 this morning. And this is people trying to get up. Remember, Bitcoin was up 2,000. And we fell 5,000 during the day. Is volatility only accommodating? Two and a half. Divide by 19.1. So, when you want to go more than your two and a half, you've got to lift your vol. It's not going to stay up there. You need sustained bearish intensity. Okay. But that's, I mean, aren't we in a vulnerable place for Bitcoin? At 85,500? What did you say? No, no, I didn't say that. But what did you say that, given that the immediate low is 80,500, and now we're at 85,500. That's 5,000 away. That's two days of normal vol. That wouldn't be healthy. It's going to 79.9, right? A seven handle? There's a lot of people who are expecting the momentum to allow their swing buys to be their swing exits. And they're dropping their offerings because they have too much paper. Yeah, but the funny thing is, this is going to happen the other way around on the long vol. Exactly, because there are handles. Yeah, but the funny thing is, David, is I'm expecting in one day, we're going to see a jump. For example, in TLT, something like 25%? No, it can't move that much. 25, it can't move that much. There was a day I remember Ultra Bond up $8 in a day. That's a lot. But the point isn't that it goes up a lot in a day. The point is that the shorts are just going to get liquidated. And you have no idea how many shorts there are. You don't understand the structure of the short. It's not just Druckenmiller and Gunline. It's not just them. It's the entire mortgage complex. They're all model-driven. They're short the duration. People think mortgages have an average life of seven years. And that that's a seven-year times $12.5 trillion. So it's $84 plus $3.5 is $87. $7.5 trillion. No. We're going to a four-year average life. We're going to go to $50 trillion. We're going to lose about $3.7 trillion of 10-year not equivalents, and we're going to lose them fast. We'll lose 100 basis points in mortgages in a six-month period, and 100 in a three-month period, and another 100 for good measure in a one-month period. We're going to be down under four in 2026. Do you think anybody in the world could begin to process that? Well, what happens when you have $13 trillion trying to get through a hole that everybody in the world is trying to get through at the same time? Because the Bitcoiners short the bonds. And not literally, but behaviorally, aren't people selling their Bitcoin and buying bonds? What are the whales doing with their Bitcoin? Whale eggs, you know? W-H-L-E-X-I-T. We're pronouncing it W-A-Y-L-E-X-I-T. Whale eggs it. Whale eggs it. Whale eggs it. No, no. They want other people to be the bag holders. No, no. They're the back sellers. They're selling you bags. Aren't they? They're like Coach. They're like Coach. They're selling you Coach bags, right? They're Hefty. We call them Hefty. He's a whale. How do you say in Spanish, the big guy, not your mom, no, that's your uncle. El Jefe. The Jefe. Do we call them? The Jefe's are hefty. They're selling Hefty. They're selling you bags, garbage bags. When you think about the prospect mathematically, forget my ideas. Mathematically, if you could go up nine decimals, you could go down one. Isn't that true? Yeah. What about two? They're selling something for a dollar that's worth a penny. I call them garbage bags. We're not even making pennies. So, El Jefe. Whale eggs it. Whale eggs it. Whale eggs it. That money, you know where they're putting it. You think they're putting it in stock? Are you kidding me? They're putting it in bonds. In notes. In UFT. What happens when Powell is forced to cut below three and Hassins or whoever cuts to one? What happens to your deficit there? What happens to the global fiscal deficit? Where does the dollar go when the deficit goes away? Upy, upy, upy, upy. What happens to the whale eggs? They pick up speed. Everybody needs to buy. How could you not? Look, it's not advice, folks. How could you not think it makes sense to egg this coin up a billion percent and buy bonds down 75%? Or in Japan's case, 90%. How? It's happening. They're not talking about it. That's all we talk about. How can you not notice that? Zero Z divided by DTC. Just change your frame. Don't think about it in dollars. Think about it in its competition. Even so, I would say, without these... outside these groups where you are talking, or the group, especially the group that is following you, most of the people don't really... I would not say understand, but they don't want to talk about it. They're excited about the discount they're getting on these great companies. NVIDIA at $1,700. Don't say $170. NVIDIA at $1,700. What a gift. Broadcom, come on. We're so lucky. And we are seeing these things with Oracle. It's down 50%. It's down 50% after Sam Altman's fable. How soon before software caps get sued for that press conference when she said there's a $400 billion order book? How soon before analysts start marking down the earnings, the bulletproof earnings? Robert, it's interesting. I'm glad I found you because it's a totally different approach, but it's the first... It's the most transparent way. It's not a narrative. It's based on... Everything is based on the mechanical markets. It's observational. It's not narrational. Yes. No, but you have a gift. Something that I... For example, I don't have. You can read the yield curve. Oh, that's a curse. Don't call it a gift. It's a curse. And don't talk about the yield curve. It's every particle relative to every other particle relative to its own time frame and its derivatives. It is so many things I'm watching. It's a good... You know, I have dyslexia. And so I was originally only at 10th grade, I think, described as that condition. Instead, your mind just works too fast for all of the other processing systems. So you should play classical music in the background. You have to distract yourself. Otherwise, your other systems can't catch up. So... Yeah, I do find it to be a curse. It's not comfortable. It's not comfortable. At least I feel like that... I'm up to 20,000 almost followers. You know it's going to... You know it goes to 100, right? I mean, they may be angry now when I say the truth. But there will be people who say, you know what, why didn't you let us listen to you? Would you agree that that's a high probability event as we roll over? Yes. That's why we record everything. A lot of people don't even listen to my statements. You don't need to. Just read the title. I spent more time on the title than anything else. And so if you just look in the arc, like, how about that provocative title, Bitcoin Can Lose 1, 2, or 3 Decimals? Do you think anybody in the world when Bitcoin's over 100,000 could talk about Bitcoin at 100 and not be concerned about humiliation? I don't see any other path. I do what's called decryptization. I do a partial derivative with respect to time across all assets. I go look for the equilibrium state. I can't find it. I can't see yields staying above zero. But it's hard to explain that. Well, it's hard to talk with people about that because the inflation... Well, but that's gone very soon. The decoherence phase, it's called the Rorschach test. Laurel and Yardley, everybody gets to believe what they want. They get their narrative. But do you think it's safe that I went octagon style yesterday? By the way, we're at 151 up from 40. No, no, we're at 35. We're at 151 on Oracle in the middle of June, between June and September. We're at 35. Now we're 420% more. That's... How are you going to get the money for this? When you go to debt and not cash flow, you've got a problem. Palantir is down 6. Broadcom's down 5. And then the lower quality ones, Virtus, Vistra, Oclo, gee, Vernova's down 10% today. Their earnings report doesn't help. And you know that we talked about people are moving from Bitcoin to silver. Bitcoin's down 3. Silver's up 6. It's very easy to move around noise. Right? It's very easy to move around a bond, right? Because there's nobody in it. They've got the real holders. They're not selling. They don't care. So they're trading around. It's a fishtail. Is this a body? No, it's a fishtail. And that's why I talk about why I like to watch the curve, the sections of the curve. The secant is actually the technical definition. I'm trying not to do too much trigonometry. It upsets people. But it's a secant. It's a section. It crosses through two parts of a curve, a wave function. The secant is lengthening. These policy makers try to lengthen the economic wavelength, the economic cycle, the phase. They try to stretch out the secant of the cycle. Well, the system is pushing back. And when they're saying, oh, we're leaving tech and going into banks, that's about as dumb a thing as you can do. Right? Because the more the money leaves tech and goes into bonds, you don't want to be selling volatility when bond yields are going down. Bond yields are a volatility. Right? They're a volatility above zero rate. And the curve is a tangent deformation. It's a theta. It's an angle. And, you know, they're over-easing, so they're buying the short end of the curve. But where are we? The one year, the two year, the three year. They think the solution is QE. No, that's the problem. They should be selling, not buying. They should be raising rates. Anyway. What else did I miss it? No, I was just thinking what you were saying. You still see the de-risking, so the last part of the thinking, thinking, talking about the yields, you still see the de-risking when the housing market is still booming or it will be the last part of society? No, no, no, no, no, no, no, no, no, because what's going to happen is rates are going lower and it will cause a ballooning in housing. Yeah, correct. And then housing will not be made more affordable, or rather, you get to a point where if you take rates from 6 to 5 to 4, 3 to 2, you know, from 2 to 1, you're not going to be helping housing. Right? It will take a lot more to lift the price of a treasury from 2 to 1 than from 6 to 5, but we get to a point where housing is not going to be sustained just by lower rates. So then you'll have less borrowing. So the only borrowing we're going to have is housing on a net, right? What happens when you don't have net borrowing in housing? Then you only have investing and savings. We have so many savings in the world, M2 is too big. The quadrillion dollar monster we created is going to eat everybody. It's fun on the way up, but that was an accelerated expansion and it was a velocity acceleration of money where we decelerated. And what's leading lower? Right? Beta. I said it was in three rate cuts. Okay, I didn't expect it to be the first one. It existed as a possibility, it wasn't my big case. But we are at our maximum compression with respect to the S&P. For beta, it's down 5 of 6 days and a new reaction low. Well, I want to know, friends, what happens when the 2-year takes out its multi-year low of the 3-year? The Fed has just bought... Today is what? The 17th. To... It was the 5th day. They bought 10 billion dollars of Treasuries. The Fed. They've got 30 trillion to go. So that's fun. Not to mention they stopped rolling off. CoreView. What's its credit default swaps? How come these animals are not showing you the credit default swaps? You know, or maybe you don't recall, but I... Was I talking about credit default swaps at the very beginning of Oracle while I was still going up and said, no one's going to buy their debt without hedging it. You're not going to find a bid. Do you recall me talking about Oracle's credit default swaps? Why wasn't it leading the day of their earnings report? These people don't care about you. They care about your ad dollars and your eyeballs. Or your eyeballs and your ad dollars. It's crazy. How do they not put it up for CoreWeave? Oracle's 150. Two. CoreWeave is 800. What do you think is going to happen when Citigroup's numbers go to 200? They're buying Citigroup. What is the matter with these people? And I have a pension with them. Those motherfuckers. I'm too young. I'm too young to cash. It's scary. Scary science. What happens if we could get two days of Vega-adjusted price discovery in Bitcoin? That's your 5%. That's your... That's your $79.99. Folks, I don't guarantee anything other than one day we won't be there. But Oracle... But MicroStrategy's 600,000 coins? I'm pretty sure they're going for them. I'm pretty sure the market wants to take them back from him. What do you think? No, no. That's inconsistent right now. Well, then that takes you to 74. They start selling. That takes you to 7,400. Do you think you're going to be able to sell 700,000 coins that are forced sale and people aren't going to front-run you? Correct. That's why you have Costco down because people are buying Costco funding it with Walmart. So it's in a correction phase. Gap hit a new high. Walmart hit a new high. J&J is hitting a new high. You know, when are we going to have a day where all the XLV are up on the day? Oops, we just had one a couple weeks ago. But nobody really hired. Why didn't it lead every broadcast? For the first time since like 1998 that happened. Okay, someone asked for a quick explainer. When you want to calculate volatility, the easy way to do it or the expected movement in the day is you calculate the period in a year that something is active. So if it's a regular exchange traded thing, we have either 252 or 253 days depending if it's a leap year. So you can just take the square root of that just on any calculator or X to the 0.5. Okay. And then you'll get 15.87. You can round it up to 16 or you can be ridiculous like me and divide by 15.87. But they say Bitcoin trades every day of the year. So they say, oh no, we trade 365, 366. So you only require you require a 19.1% of the square root of 365, 366. You use 19.1 as your denominator. It's meaningless. So if your devol is reported at 38.2 and remember we're at 31.4 on August 2nd of 2023, that was when they pivoted to the easing or the pause, then the easing. That was the last hike in July. Bitcoin vol went 31.841 up to 92.71 up 186. Bitcoin goes 25 up to 125. Really it's 126.272, but let's round. A 400 vols up almost 200. Vols all 70. Bitcoin keeps on going up. That's not normal. That dealer's saying, I'm not worried. You're not going to make me a delta hedge anymore. That's over. That party's gone. I'm putting up virtual coins right and left. And that was three weeks before the crypto crash in 18-day, giving you two sequential week closes and saying everything's fine. In the short end, because Bitcoin cannot go to new highs, they're nominated by its volatility. Just a negative divergence with respect to its volatility. So that's the detector. So when you're watching a devol, you can say, hey, it's 57. It can go three a day. 57.3, it goes three a day. 38.2, 50. And then you're in the middle of the range. But what happens when you get the whack-a-mole? When they pop on volatility, but they knock it right back down. And why is that? Because its kurtosis is contained. It's not actually going to be able to move that much because people are positioning to sell all the volatility rally. It's not just people are buying vol and selling vol, but they're ranging and they're prepared to sell vol at lower highs. That's the lower kurtosis. That's the derivative of the fourth moment. Okay. Okay. Okay. So, that's the math. And we're seeing a deterioration in volatility amongst a number of places. So the capital's booming. It's going over to silver. It's not going into gold. Gold is real. Gold is 35 trillion. 30, 35 trillion. It's not helping oil. What happens if Maduro leaves? What happens if Trump makes a deal with the oligarchs, just like he made with HDS in Syria. He said, let's start from scratch. Let's get along. Let's start from, just get rid of the Hezbollah, get rid of the Hamas, get rid of the Iranians. You can see we're making deals with Argentina, Bolivia, Chile. We're going to be sending billions of dollars. We're going to make, you know, Kamala Harris was sent to do the root causes. Yeah, it's called poverty, corruption, and theft. Well, what happens when America is going to be running our hemisphere super hot and we're going to need all these materials and they have all of them? The money will circulate locally. There will be no immigration. There will be outraces. There will be people leaving us to go back home. What a shock. People are complaining about higher electric bills. These corrupt AI monsters thinking they can just push off their costs onto regular people and they're not going to complain? Well, yikesies. You've got lots of headaches. Lots of opportunity. But I want you all to look at this Observer status, this life tone. It's up in the nest. Okay, future. Observer, Heisenberg, the more you see from when they put up the Bitcoin ping to the crawl, that's more eyeballs seeing Bitcoin. That destroys Bitcoin prices. Just the observation. This is a thought experiment in real time. The more we're watching Bitcoin, the more it goes down. And then what's going to happen when Bitcoin is at 100 and it's going up? No one's going to notice. And then it's going to go bananas. It's going to go bananas. So Micron's telling you a good story and it's up 7 to 241.30. I'm not going to be surprised when it's below 200. Memory demand is losing average selling price, bottlenecks to meet types of demand, plans to lose capex to increase production, just at the wrong time. Okay. But I want you to notice that sometimes you're having vol compression before vol expansion. And vol compression is now in the background and you go right to expansion. And that's what NASDAQ versus the S&P 500 volatility is. LFB. Okay. You've got to take out the word ZACH, Hylito. It's going to be whale eggs. And it's only... You put a dash. You only need one E. Whale eggs. It's one word. You could put a capital E between the L and the X. So you'll see the word whale, and you see the word eggs, and you center it with a big E. You know. And I wonder if you could use the one E between El Jefe and the E in whale eggs to try to have them all interlinked. But let's lose the word ZACH. It's called whale eggs, but it's terrific. It's terrific. But that's what we want to see. We want to see El Jefe. We don't need the dash. And then we want to have whale with a capital E fused with eggs. And maybe we could make the E so big that the E covers the Jefe and the whale. Give us that version. If I may say something? Please. I'm not Spanish, although I can speak Spanish. I'm not Spanish. I'm Portuguese. He has to change the Jefe. He's with a J. He's not with an S. I know, I know, but that's what's important. It doesn't matter that it's wrong. This is persuasion. You're going to make people think like that. There's something wrong with that. And they won't even realize that they're watching it. Right? So that'll make fun. You don't see the J. This is what Trump does all the time. He's off-center. He said, like, it was terrible what he said about Reiner. But he got a message off the guy at EDS. Terrible. But this is exactly what it is. It's wrong. But it's not wrong enough to be wrong. Yeah. You see what I'm saying? Very funny. You know, let's try variations where the H... Oh, how about if we try to do a crossword? You know, with the W-H-A-L-E and then exit down. I don't know. Make a couple of these. Because there's an overlapping H. You want to overlap the E. But there's a lot to work with here. Here are my bags. No. No. Not here are my bags. Here are some bags. Here are some bags. Here are some free bags. That's it. Here are some free bags. Okay. Work on that. Work on that. We love it. Don't we love it? Hey, get back up here. What's his name? He made me have to leave. Where'd he go? Where'd he go? Gabriel. No, no, no. Gabriel. No, you're still here. But are you kidding? I mean, when we're down 10%, it's different this time than before. Why? Oh, there he is. We lost him. But when we're down 10%, it's such a higher market cap, right? And then you'll have the Fed without any more room. And then you know individual investors are drowning. See, the problem is they lost oil. By the way, NDX was down 193. The NASDAQ was only down 181. But that was down 12 basements. But what if we get a good selling day? I mean, a good pressure selling day? It's a big problem. Because now you're really starting to put money, people put money in bonds and, you know, but then you lose the banks. That's the whole point. They're putting, I just said before, they're putting the money in the banks. That's craziness. They're buying Citibank today. That's craziness. J.P. Morgan apparently bailed out Atlas or some other entity and then wanted to lend to them, so they basically upgraded their nearly default status. You got Citibank. I mean, folks, when we see 599 on the mortgage, we're going to see pain. We're going to see a bid on the long end. We're going to see dollars shrink. It's so alarming that you literally have nobody discussing any of this. They don't want to hear any mechanical relationships. Wow, NVIDIA's up a dollar on Micron's story. Okay. Bitcoin's risen. It's up to 86. You know what 179, you know what 799 is. A 7-handle is a big problem because a 7-handle is a 6-handle. And once you're at a 6-handle, you've got all kinds of paper coming out of strategy. How do you dump 650,000 coins into a falling market where whales want to get out? I remember Grant Cardone saying, Well, selling 10 billion a coin over the weekend. Yikes. More recent. What? The big movement today. Even today we saw that. They went up. They've been down, squeezing the shores on the way up. And then they reloaded. The whales reloaded. Whale exit, Benji. El Jefe. Whale exit. But it's really, it's what do they do? They scream. This guy screamed at me. Insulted me. All kinds of horrible things. Because I said, cutting rates at this, with an inverted curve, destroys money. It doesn't make money. Eventually it makes money. And then I said, you know, cutting rates destroys inflation. They said, We enforce inflation. I said, We enforce inflation. From 2009 to 2016. The entire, Obama got 125 days of slight hikes. One. Trump got the same number of hikes as Obama between the election and the inauguration. And so, we had more than zero inflation. I said, This is below target. This is below target. So stop. Stop. They're kidding. But go look at the returns of the MMA. Microsoft, Meta, and Amazon. Are they even up? Single digits? Do you really want 8 billion to be, 8 trillion, excuse me, down on a year? What happens when one guy, who's real, says they got a problem? Or, you've got a problem with SMCI or Core Week. Right? What happens then? What happens if Dell says something? You know? You talk about it, you lose a trillion dollars. That's a lot of buying a treasury. That's bad for the bank. It's like everyone is agreed, Oh yes, the banks are worth something. Oh yes, mortgage rates belong up here. Oh yes, the FR has clothing. As his dongle is dangling. But the ones that speak, investing in bonds or mortgage, well you can count them with one hand. I don't see any other exchange rate than that. They are, do you see it vacuuming the capital out of the other stuff? They're vacuuming the capital out of data. Bonds and mush, they're vacuuming the money. The problem is their negative duration, that they need a certain level of radioactivity, a certain level of mass. They're losing their mass. They're losing their gravitational attraction. And as they shrink, they can produce less virtual deflation. So then the natural money that's buying, buying duration has to go through them and get to the real stuff. We have the VIX and TLC, it's on the verge of under 10. The move index at 62. And now, what's the problem with that? Every month we're replacing a 120 with a 60. You are the first one to, I never saw the move, to be honest with you. I never, I never, it's the first time. How about the bonds, did you ever look at bond volatility? Or no? No. Okay. You, you helped me to, well, to look into volatility more. The only volatility that I've seen in the past were related to debt. Yeah, but you're only looking at one volatility, not cross volatility. You see, if you're a bond volatility trader, you look at two volatilities paired off. You were looking at volatility versus cash, which has no volatility. Sorry for my short-sighted view in bonds. No, you're here now. Right? Right, right. But do you see how, do you see what's going to happen? I mean, I have it up here. The low from COVID was the all-time low. You know, in my view, we're taking that out, right? Yeah. What happened the last time we did one of these? That was GFC. Okay. Let me see if I can do a three-month and make it clearer. Okay, yeah, I'll do, oh, shoot, I went long. You see what, what, every, over the years, what, what you, what you posted, and, um, can't get it for any reason. I saw yesterday, for example, that, um, pension funds from Poland, Dutch pension funds were not any more investing in bonds. They were taking in, throwing out, uh, and investing in anything more. And I, and I, I don't understand why, five years ago, we were here in, in Europe, making emissions, all emissions, with, uh, 500 years, and so on, and they were working, and now, for some reason, people, they are short-memory, and they are not anymore talking about bonds, so it is, what Gabriel has here is, it's actually because they cannot reach the amount of money. People don't have appetite at all for bonds funds. Strange. The system does. You do. Now, one of the reasons why is because they kept on shoving equity vol, virtual deflation. They kept on putting it to bond volatility. You have to think from my frame. Sorry, folks. Not advice, but you have to think about it from my frame. They ex, policy makers excite into existence a pair of inflation and deflation. Particles of inflation and deflation. And they just say, here, here's the inflation that steepens the curve, and we'll just park the deflation somewhere else, and we'll just try to keep it there. Guess what? There's a drawbridge. It's going to leak out. Do you see it leak out? So, you're hiding it. Well, there's no more room. It's like Trouble with Tribble. Or, uh, what was that, um, um, Steven Spielberg movie? With the goop, where, where you're not supposed to let it touch water after night. Um, I forgot the goop. I don't remember the name of the movie, but Spielberg had a movie, Gremlins, Gremlins. You're not allowed to give them water after night. Okay. They've taken five years global, after Japan started this nonsense in 2013, with just hiding deflation. They're using current inflation. They're using all this excited virtual inflation pair. And they're parking the deflation in equity. It's going to leak out. So when people say, how do you get rid of this inflation? What are you talking about? We have 70 trillion, we have 100 trillion dollars of global deflation. Hiding gold, silver, and equity. It's, it's, it's virtual deflation. They shoved it in there. There's no more room. We're going to have deflation for years. We're going to take this 70 trillion dollar equity, 67 and a half equity inflation, and it's going to just push down and flow into housing inflation. Main street inflation. Main street asset inflation. Where 75% of Americans care more about their main street inflation over their, over their Wall Street inflation. At what level do you think people might start listening to what I'm saying about Bitcoin could lose decimals? No shock. It won't even be when it's down 50%. Which is down 50%. We went 25 to 126. So you lose 50, 10. That's halfway. So you take it down to 75. Okay. Then you got, say what? No, but, but, they get 80, 80% draw before they get, you know. So, my base case is, if you could take out the 69, then you could say we have a 5-year bull trap. Right? Because it hit 69 on 10, 11, 21. Remember? Code reduce. 10, 11 plus 10 equals 21. November 10, 2021. You hit 69. You take that out. You start closing below there. Isn't that 5 years of supply that's got to come find a home? You have a price. You go up a lot. You come back to that after 5 years. That paper's got to travel. Where are you going to put it? And a lot of that's going to go into treasuries. So, so that they're so excited, they can talk about, what? Silver's up 492. They're so excited. They're so excited. Woo! Woo! Aye yi yi yi yi yi yi yi yi yi yi yi yi. Aye yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi y yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi yi It's so unfair, in a sense, to let people, you know, not know what's really working. It's like you're making them bag holders of the system. And you don't want to do that. And I'm not trying to put you too much on the line, but I'm putting you a little on the line. Because I think we have to take the responsibility to protect other people. Do you think people are going to be happy down 30%, 40%, 60% of the NASDAQ? You're right. Let me explain. Let me give you a perspective. First, the way you explain the thing, because you are far ahead of most of the people that I know that speak about this. I don't want to give you, I don't know the name of the expression, but I don't want to put you on the pedestal because you don't need it. But you are the first person that I saw that you explained the micro view. You remember when you were talking, you don't talk anymore about death or you don't talk recently about death. Do you remember the information gap? Yes. When Trump went to power and you explained what was his idea. Well, you have a vision of the macro that can really help to understand what's going on and what's going to happen. So, the first vision that you gave to me, I tried to explain to most of the people that I know, that could be helped by this. And as you know, in the beginning, there was a setback because... Policy supported prices and it allowed them not to notice what's going on. Exactly. Exactly. So, everybody at that time, when I was trying to explain what was happening with the tariffs and what could happen when the deficit could go down and there was a lot of efforts in that direction and the reason was to help the mortgage rates and so on. I've been in several meetings and no one would believe that. So, I had a group of people that I tried to explain what was going to happen in the mechanics. So, to make the story short, I have now one person that will have the subscription paid by me or gifts at the Christmas. So, you're going to have another one besides me. So, the answer to you is yes, I'm trying to help people, but this is a transition that... Of course, of course. I totally understand, but now what's happening is you're so electrified. You are literally electrified by the realization that you are running down a sluice gate. You are right with the information. You are right there with the algos. You're not catching up after mistakes. You are waiting... You know, it's like Braveheart. Do you remember the movie Braveheart with Mel Gibson? Yes. And he said, hold, hold. And so that's what you are. And now you're seeing it. When you see the market down 10, 20, why is this different than other times? And the answer is, what's different is under a steep yield curve, the Fed cutting adds liquidity. When the curve is steep, they don't add liquidity. When the curve is steep and cheap, meaning we're below three, you're destroying that amount. So when they start cutting 25s, the market will go down two, three that day. And they'll have to go cut 50s. But what's the problem? They'll take a job-free mortgage into the 40s. So I told you, but as it's developing, it is the time... I just want to let you know that the framework may not have been perfectly well explained about how much the Fed could solve, keeping in mind that Greenspan never did the easing. He waited for the equity deflation. He eased afterwards. Powell is emptying his chamber. There's nothing left. What can he do? You think if they cut rates, it's going to help the stock market? No, it'll kill the banks. So I get that it was frustrating in timing, but now that it's actually happening, it might allow more coherence to some people. And just keep on going back, because anyone who could lose less money now will be in such a position to be able to buy when volatility is low, and then just wait there with, you know, back stacks and hope. Back then. You know, at that point. So, but I just feel like we all have to step out of our comfort zone. This is our once-in-a-lifetime opportunity to really have a 25-year bear market start. When I say, not that we're going to go down for 25 years, but the bull market of 23 years, we have a 25-year cycle. We'll go down for two years. Then we won't go any lower. And so then it's only about time and going higher. But I mean, thinking about it. This might take, in my view, I mean, I'm not, I don't judge or know this, but this might take more than two years. Not the question that we go down. We are definitely going down. We will go up. Play it on the edge. No, no. Going up is the time that's going to take a long while. I say a thousand years below. I didn't say it's a V-bottom. We have so much deflation in the system. Correct. The money will be made shorting the euro. The money will be made shorting, you know. But the going up will be few and far between. The idea that a ZROZ ETF traded at 65 is going to go to 250, it's insane. It's not advice, folks, but it's insane. But I don't see anything else. And until that stops going up, how is that going to go up? How are you going to compete with the treasury giving you 20% a quarter returns? It will be just an unlimited... It will be violent swings. No, I don't think so. That's the whole thing. In the equity? No. No, that's the whole thing. The VIX, do you remember we went down five basis points a day? For S&P. 16 for tech. Over 9 months and 10 days. And everyone spoke nothing. You know? We're going to have a couple of, you know, like the Elliott waves. We'll have a big draw, a rally, and then a huge draw, and then a rally, and then a smaller draw. So we'll have waves. And they'll be clear because you're watching for them. And like, you know, people with leverage stuff, they'll like, oh, I'm going to close down my leverage shorts as it's falling because I'm not going to be able to cover on the way up, right? But it won't be very disorganized because there's so many volatility shorts. So many people just sell, you know. So you have to look. And you'll see that it's not going to be clear. But we will get to a low. Remember, we went 55% lower or 50% lower in 10 weeks with the NASDAQ. 10 weeks, 55, in GFC. It took 130. It took, for the 57, 57, it took 130 to go around 83 cents. So, you know, there'll be problems and gaps. We might have a halt to trading day in the NASDAQ. That'll be fun, right? Bitcoin down 25% that day because people want to shed their duration or buy back their negative duration. And what are you going to do? If the NASDAQ is closed and there's like margin calls, aren't people going to be shorting Bitcoin to be able to get some risk off? Wouldn't you think that makes sense? Yeah. Because they're going to be open. That's down 25% that day. Or more. Yes. I mean. The leverage stays, let's see. The call price will go. But it's not. It's re-leverage. We're re-leveraging. We're re-leveraging low beta. We're re-leveraging no beta. Let's think positively. We're getting our fuel from there. But we're in re-lev. Look at my name now. I'm back at re-lev. I prefer re-lev. Doesn't it say I'm leveraging up low beta? Yeah. Yeah, I know, I know, I know. I like the positive. It's like a jet engine. A lot of the air comes in and it gets squeezed into a small space. By the way, do you know? I don't. My first... To give you a... Because it took me a while to understand your model, I think. The mechanical of your model. Which is quite different than the European one. And I really... It's different than what? Than the European. Oh. Because of the mortgage. Yes. And I... That's the whole point. Exactly. But it took me a while. Because most of the time I was thinking in mortgages as bonds. Yes. And they're not. They're equities. That's the whole point. They're equities. But besides that, they are really... You don't need to have a quantifier. It is really a liquidity engine. It's a liquidity engine on a bonds and an engine. Because it's either a store or a... Or extractors. Exactly. It's a liquidity engine. And it makes all the things. That's the difference. So, this is not... I think you said somewhere that the cost of your models were based on... I was originally equity and credit. And I collaborated with a mortgage guy. I had one engine. He had the other. The plane fell... Flew smoothly after that. But you got the key to... You were working with models with... Harmonization from the... What do you call it? I don't know. The rate of transition between the different derivatives. Is that how you call it? Of the derivatives. Of the different orders of derivatives. Yes. Wasn't that your first... So, that's one of the elements. But I was not dealing with the mortgage volatility engine. I looked at mortgages as debt until I learned they're equity. Because they're a short equity that neutralized... If you have a short equity position... If you have a short volatility position... That could overwhelm the entirety of your position. If you have an Apple stock... And you write for calls against it... Right? Eventually... If you come back a year later... Your account is negative. Because your short call can go up against you more than you have equity. Anyway, look up in the next. I haven't gone through it. This is just one of the early strokes of a comical... What do they call it? A burlesque. Of a comical... What do they call it? A burlesque version of the model. It's the short option in the mortgage that people don't understand. Don't want to listen to. Won't listen to me. And the mortgage model system... They don't care. They don't have leverage. Most of them. So, they don't care. It's irrelevant to them. They don't mind being short. They'll just react. And what's different now than every other time is... The banks couldn't put the brakes on and screw middle America to protect themselves. They now have staffs. They have independent mortgage brokers. That are going to transmit the duration out of the system. And flatten the curve. The Fed has been trying to keep the curve steep. Isn't it clear that's what they're trying to do? They can't. They can't. Because once you get mortgage... The curve steep enough... You create... Fixed to floating. But if you go lower and that's the clearing rate... You'll accelerate the fixed to floating. You know, 0 to 8... Is a lot harder than 8 to 24... 8 to 32. And that destroys a lot. But you see what I put up in the nest? Yeah, yeah, yeah. Thank you for that. I don't even know if this is what I told them. I said, you know, I want to do pistons... And I want to be moving the beta... Capital... You see that there's a flow of volatility. Yes. And mortgages aren't dead. But in Europe they are. So you get the free call. Right? You make the money. You pay for it. You get the money. During GFC they screwed you... And they said we're conspiring... And you're not going to get any of your... Yeah, you bring us 40%. You'll be able to get cheaper rates. Who had that money? So now we don't have the problem. And so that's why when we flatten... And we're only 25% credit formation out of the banks... He's back. When we flatten, we strengthen. When the world flattens, they suffer. So when they're suffering... Their dollars are going to come back. And the dollar melts up and kills inflation. Fast, though. It's faster than two years to the low. I would think. Because of the corruption. And then... It's just great. Anyway, I'm going to take... Do you have one final thing, Jose? No, no, no. Sure. I'm going to have a look. I'll have a look at this. But just remember, I... The light in my head just came. When you said... I'm thinking of repudication and repudication. And then the light came in. And that's it. So that's it. And so now... Understanding the mechanical nature and the reluctance... What I call coupon latency to the borrower... Which will evaporate when prices accelerate higher, right? No one's going to let the house they want to buy go up by 20 grand... And stay where they are because they're saving 1% on the $500,000 loan. And when rates go lower, mortgage people are going to have to do what they do. They're going to have to buy duration. Everyone's going to have to buy duration. And they're all going to think, oh, there's plenty because Donald Trump's a bad man. And tariffs are inflationary. Except they're deflationary. And they create extra supply. You know? I'm going to push off my general spaces for half an hour. I'll spend another half an hour with you folks. But it's helpful to me when people talk and... They don't let me do that when I'm in the spaces. Let me see if I can get it from somewhere else. Let me see if I can get it from... Anyway, so I want you to just work on some of the people. And then remind them how you're seeing things right now. Right? That you're seeing an accelerated decline. That Bitcoin is... It'll be easier when Bitcoin's under 80. Because then you can demonstrate that Bitcoin is down 40%. See, listen. 126... 46... 46... It's divided by 126. So, it's down... So, it's down... No, it's 46. At 80K, it's down 37%. Yes, that's right. To the Nazis. So, let's do that. Let's do... 126... 272 times... 38.2... Okay. Divided by 100. 48,000. So, then we're gonna subtract... 126... 272... Equals... So, when we're at 78,000, that's our Fibonacci. Now... The Fibonacci is really much less than that. It's really only 38 two-fifths of a hundred range. So, let's see. 126... 272... Minus... 38200. So, 88,000 was actually the Fibonacci failure... Failure... Of the drawdown from the... The trough... In the ray-hiking... The ray-cutting pivot. So, the August 2nd, 2023... 25... Up to 126,272... Basically, 87,88 was that Fibonacci retracement. So, the more time you spend below it, the more it's gonna want to go the next... 26,400. This is the 26,400. So, 26,400... After 88... Is 60... That's what keeps the drawdown. So, the bottom line is... As you're seeing some of these things, is just highlight the people. Show them this chart. I'm gonna improve it. I have enough chances to mount today. We'll do the half-day. And then just sort of think, you know... When the tech cuts, they stall the progress. But now... Oh, my gosh. Oh, no. I've got a 13-page thing that I wrote. I wrote... I hate redoing my own work. Can someone be mean? I hate it. Anyway. So, please do that, and you'll know your health people. They will be... Wait. Someone was saying yesterday they feel like a bag holder because their friends were dumping over 100, and then he's still holding 20 down here. You not letting them access to the model, you know, and kicking the tires themselves, they're gonna, you know, whatever. But thank you for what you did. Thank you very much, sir. Okay. Anyway, does anyone... We're gonna jump over to the open spaces. Oh. No, no. This is what I wanted to see. This is the quantum... The paper on quantum physics and quantum finance. So, that I do want to read. It's all my work. So, let's see if I can edit that. Okay. Okay. So, it looks like I was able to delay that for half an hour. Okay. Mr. Lefevre, have you taken any aspirin today? You're loving that one. I can't take it. Okay. Yes. Okay. So, one question because I know you want to run and... No, no, no, no, no, no. I added a half an hour. I added a half an hour. Okay. So, yesterday I heard you on the spaces. I thought you did well. I mean, I thought you presented yourself well in your position, in your framework. But I'm continuing to hear the narrative from you as it pertains to the cues versus spy and the cues are losing more. So, you're pointing out the decimals... It's deflation. The underperformance of beta. And I think it's been four or five days in a row. And then when you... No, it's five to six. We rose yesterday. We took it all back. It's up in the nest. Right. Is it? Okay. And then the kid was testing you on when will you cover your short on aspirin? And you gave him the answer that I was expecting which is when you see the cues start to make that pivot. No, no. Not a pivot. My question is... It's not making a pivot. If the cues were to re-expand from pivot. If they were to re-expand it means the risk on environment. And we ate through that yesterday despite the cuts. Correct. And I get all that and pivot was the wrong word. So, I understand all that. In the interim and I'm looking at this from a training... And I know you're not advising on training. But I don't... If you're pointing this out and I'm recognizing it how am I not shorting the cues and buying SPI? I have no idea. I have no idea. Okay. So, you would agree that that's probably a method. That's the trade. I do it with all... You mentioned on Monday you got it into solid puts and then I was like... No, no, no. That's how I would do it. Because you're making money right? When the markets aren't even moving. You know how much money... You know how much money... I know how much more... Cues SPI was down is down two. Okay. You made four in the ball in the six days. Okay. Got it. Yep. Because the cues... Those calls collapsed. Right? They went big wanted. And the spider only moved down half as much. How much did the spider... You know. How much did those puts expand? How much did you make on... Did the guy who bought those puts that you shorted them on the S&P? How much did they make? Not much. Not nearly as much as you went big wanted on the cue calls. And how about when the Vixen jumps? You get paid even more. Right. So, I'm not advising you to do anything in volatility. That's like... I think... We're way above people's pay grade. But just... Do you expect the NASDAQ, which has gone up 32 times versus 8 for the S&P not to compress a lot against it? Right. I just wanted to clarify because it's part of your framework and it keeps coming up and then I... But this is the first time a raise cut couldn't produce any expansion. Any data expansion. Right? In the cycle. It could have taken up the two more meetings Turns out Sam Baldwin's fables are coming home to roost. Sam's... Sam's... Sam's fables... Sam's fund of seven fables. Sam's fund of seven fables. That's... That's the... That's the graphic. And Sam is sitting there with a decimated seven down to 90. Sitting with Lisa Sue and Jen Sue and all... Hi! In the background. How you doing? We're all listening and wishing you well. We're a big fan of Sam Baldwin. Listen, he's a big money maker for anyone who knows his nonsense. Wait till he finishes talking take the other side. Apparently the market didn't value his ten billion dollar shenanigan with Amazon today now did it? But you have to understand when we're down 20 percent there's nobody left. And it's the individual investor that's absorbing institution and hedge positioning. So Vix Vixen is a disaster right now. I mean it's... It's pitch-a-gawk. It's nothing. Yesterday they tightened it up like crazy. We're... We're... Any thoughts on CPI tomorrow? Yeah. I don't care. Can I tell you what the better question would have been? Of course. I expect that. Okay. Great. Is there something more important than CPI tomorrow? And then I would say yeah. No. Time and sales on the two year. The Fed is buying 2 billion a day. That's 3 billion a day more than 15 days ago. Do you think the market's prepared for that? No. So do you think they're going to be able to sell off those two years no matter what that CPI is? No. My father's 19th anniversary on Christmas this year. Oh, wow. That's Christmas. Yeah. Well, I use a I use a lunar calendar so it moves around. And then his mother was the same day but that was 33 years ago. Wow. Let's see. What was I what was I looking for? Thank you. Yeah. Which year are you talking about here? It was the so the let me just check on something. Oh, the mortgage rate. So the problem is mortgage rates are Dan Bongino he's cutting down. That didn't really work out so well. Oh, I can hardly see the Japanese 40 to Japanese. So yeah, I mean we want to see how the dollar reacts to these things. Right? Let's say it's softer data. Dollars can be going up when the curve flattens at some point. You know, we were up a little but it was up a lot in the morning but but you know you get you get curve opportunities because they're doing all of the of the of the QT. I mean QE. Excuse me. Oh. So I didn't put this up but I want to put this up. It's very alarming this chart. It's arresting. Let me put it up. Oh. Okay. Okay. Now I'm sending it up. Okay. So I I just sent it up. This is the the bond to the the move index which is the whole curve double weighted for the 10-year two 5's, 10's and bonds. And when you look at this chart you see two rabbit ears or two giant vacuums. Right? Are you looking good? Okay. Okay. So trust me it's got two giant vacuums. Which were they? It was GFC. Okay. So the move index gets down to 62 on a monthly the lowest monthly close in the GFC prior to the GFC was 62. And then it went from 62 whatever up to 150 255. And when we spent the next 8 years coming down or so 6 years and we had no inflation for a decade. Right? We're at 62 now on our way to 38 or 30. We're going to have so much more volume of that that air pocket is mathematically deflation. Okay. We're not bouncing off of 62. No, no, no, no. We're going to go sideways at 38 which is COVID low or we're going lower. And you know how much confidence you'll have when the move index is in the 30s after just being 195 and 140 and 140 and 140. There's so much deflation behind you and these idiots are talking about inflation. What are we doing? It's an insanity. I'm going to be talking about inflation. I'll send you that picture. Just okay. Because you're driving. So I sent it to you. You'll be able to see it later. But it's a ginormous bimodal distribution. And this is the problem. If you're not looking at the markets as a mathematician, you're X. Okay. Because they're talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. 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And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. And I'm talking about inflation. Sure. Where's move? Oh, someone asked about WMTR. MTR. Yeah. So, people get to do whatever they want. This is something I would have zero interest in. Yield max, microstrategy, short option. I am not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. 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I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. I'm not going anywhere near someone's ability to change their mind. These people who are in there aren't there for half a percent a day. It surely moves over to silver. They're not going to stay there, in my opinion. So, that's all. It's exciting. What you see is those funds... I could take Crypto Ghosty for a couple minutes because we do have to jump on to the other spaces. We've been on here for like an hour and a half, two hours, whatever. Anyway, they're chasing performance. And when they chase performance, they don't seem to care if the underlying is a $67 trillion NASA D or a $45 trillion NASDAQ 100 or whatever it is. They don't care. It's a report of performance. People don't care that Bitcoin, when it went from $10,000 to $10,000, had no market cap. And when it went from $10,000 to $100,000, it was ten times its market cap. They don't care a thing about that. Anyway, Crypto G. Hey David, thanks for bringing me up. I just wanted to say that since I've been listening to you, I mean, you have given me so much alpha that I combined with my technical analysis and how I approach the market. And let me tell you, I'm having a lot of success and I appreciate it. Just think when the market actually moves. What do you mean? When it starts going lower and people don't know what's going on, and you're going, no, this is what I'm looking for. Or when the market goes higher. We're in the decoherence phase. Yeah, I mean, I've seen a lot of your fundamental approach of macro deals. It's micro, macro, and quantum. The quantum is the derivative, the dividing by, the vol divided by skew. That's all right, I see. So there's micro, which is when I say banks are going to get slaughtered from an inverted curve. There's macro, saying the curve is going to invert. And there's quantum, which tells you the behavior of price. So you denominate Bitcoin in its own volatility, and you peak 18 days before Bitcoin. You denominate PLT in VX PLT, and you see it's coming down. If I may, David. For me, it's hard to show you guys how I normally analyze, and there are especially charts and everything, but I did a really good video, for example, so I was talking about a potential... If you send the video, send it to me later. I could even make one specific video of recapping and showing my goals and everything. I mean, if I could, that would be amazing. If you want to. Yeah, so I'm not... Can you give me one minute? Yes. So I've been spot on in an analysis that I did on Apple, showing a lot of massive confluence on technical indicators, and combining with a lot of what you have said, right? Can I interrupt one thing? Confluence means that there are multiple supports for an angle of view or a structure. So when we say there's a confluence of the time frames, you have the daily 50 and 200 moving averages. We're in the range. You have... We have the weekly. We're in the range. You have the monthly. We're between the two. That's a lot of people with a lot of views showing up at the same price. That's the two sumo wrestlers, and someone's going to get knocked over. So the more people with a view, the more open interest, like Mac or Jed I said, or the more factors of support of an argument, the confluence, the more confidence you have. And then when you get priced to join, you're going to run over your enemies. You're going to bring out the mug and drink their tears. And what I try to do is help you see what the direction, what a potential magnitude might be that you will factor, because people that are only looking at a two-dimensional chart, it's like driving a car and saying, I don't mind getting the guardrails, the jersey barriers, the dividers. So how can I... Because I'm learning from you, right? I like to learn from people and take whatever I find a lot of value to have to keep iterating my approach, right? In that time, when I was a model, just an example, Apple, because I've had other plays. We don't use the word play. We use positions. Positions. Yeah. So in many other positions, I had, from a technical standpoint, I had like five different factors giving me more confidence. More supply. More supply. So it's confluence is the word, but the confluence gives you the confidence. Gotcha. And another thing, I saw probabilities of managing risk, of course. And for example, on the SPX, I was also talking about that we have had a lot of rejections in the 6900 area, and we had two capitals below on the SPX. And in Bitcoin, what happened? Well, but did it help that Bitcoin was down 30% and that the NASDAQ stopped outperforming the S&P? That's supply. You know, what was my original bias of this in the short term? When Bitcoin dropped from $125K and it dropped like $36K to $80K, like I thought, I was in the camp that we were going to have more bounce than we had. But when the yearly open, which was, which is $93.5K on the daily, if we go to a yearly open, $93.5K, and we go to a daily, we have three rejections of that critical level. And that, when I began to slow up, like I began to say, okay, maybe we don't even bounce like that high. I mean, we're still kind of not broken a specific level I'm watching, because if we do, it's flushed down. Yeah, but that's with a rate cut. NQE, what would happen if you didn't even have that? And the dollar was up. It'd be worse. That's what I don't know. Like, on the equity markets, like, I'm seeing a lot of people, like I love to go into different spaces to get the sentiment, because there's mediums and iron. Those two infrastructures. Oh my gosh, please, go ahead. Sorry. Is that Mara or Riot? Which one is it? Mara, Riot, or Iron? Which one? No, it's NBIS. NBIS? Yeah, NBIS is one. Another one is Iron. Iron. Yeah, Riot is a crypto mining company. Is that Nebious? Is that Nebious from NBIS? Is that Nebious? Correct. Nebious and Iron. Iron, yeah. So people don't have, just because I don't know from a technical standpoint, because I know those two companies have, like, fundamentals, but, for example, Iron had a 10x run in April, so what people don't have into account is, if an asset, any asset, has a 10x run in a shorter time frame, like, a 50% bull run is not an asset. It's just a minimum. So in other words, if something adds a decimal, you get more than half of it back. I mean, is that bad? I mean, yeah. What's the crime? You lose liquidity. Yeah, I mean, I would argue that if you have a 10x run, 50% is nothing of a bull run. Anyway... No, please, please, please, go ahead. Go ahead. No, no, no, no. I'm very glad to have you go through that, but what I'm really trying to say is, you've heard me talk about space-time, and a planet or some cosmological object deforms the space around it, and other objects will be interfered with, including a photon, which will just slingshot around it because it's lazy. Well, we try to have you think about a chart, the trend line, as being influenced by space-time, and which direction it's more likely to warp, one of its two volatility tails. And you're incorporating that and saying, adding to the probabilistic nature of your vectors. Isn't that fair to say? Yes, but now I want to incorporate and learn. For example, you talk about the 3D charting. Like, right now, I mean, I'm using Grok to try and create problems to help me gain more probability based on technical analysis because, for example, there's a lot of what you talked about that I don't know how to... I'm still learning. I would expect you would learn for years. It shouldn't be a surprise. No, yeah, I mean, I've been in the game for 10 years now. I mean, I need you to take a look in the next. Look at that move index. I see violence. I see crazy. What do you see when you see that chart? The move index. It's a 20-year chart. It shows volatility collapse going into GFC, and then it spikes from 62 to 255. And it took forever to get back down. This is a three-month chart or a one-month chart? It's a three-month chart. This is a quarterly chart. Okay. Do you see all that area above the dotted line between 2008 when you went from below 20 straight up to 70, basically, on the quarterly RSI? Do you see that? Yeah. Yeah, yeah. I would like to pick up this chart real quick because I'm trying to zoom in on this one, but yeah. Okay. That was the Lehman Brothers, you know, that was the whole blow-up. Okay, in 2008. Okay, the rally we had in 2008? Yeah, that was... We had an election. November of 2008, they pulled the rug out for Lehman Brothers to make sure Obama won. Otherwise, McCain would have won. The Treasury Secretary that made the decision, excuse me, the New York Fed President had the decision-making over Bernanke. Bernanke says, I assure you, don't think the U.S. government would succeed in bailing out Lehman Brothers? He said, I'm worried they might not succeed. He said, so we're not going to try to succeed and let them go belly up. And look what happened. I mean, which... Are you talking about the more recent one, the 38-load at rally? Incorrect. No, no, that was... They did QE, and they drove mortgage rates down, and mortgage volatility down, and they made everybody grab Treasury to under 1%, and you didn't need to do that, so you killed volatility. But we never went back in time. Right, we had a 155, but basically, you know, the 195, that was just... That was Silicon Valley Bank. But you can see we have a much lower structure, right? Volatility accelerations, that's a much lower level. That's too much money in the system. But you see that big area over the dotted line, that's a vacuum? You know the upside-down V? We have between 2008 and 2013, and 2019, and now, you see those two giant vacuums? Yeah, I do, yeah. Do you know what's located in those vacuums? Deflation. That's deflation. Deflation. And what is the... You're saying deflation is going to come, and how long... The greatest amount of... It'll last for a decade. Yeah, yeah, yeah, that's my question. So, oh, you think that? That we're going to have... Look at the left side, look at the left side, that's deflation. It came out of how long did we have deflation? Obama got one rate hike in eight years. Okay, but then, let me please understand something. So, now, talking about real estate markets, if we're going to have a massive deflationary period, wouldn't that affect, in a massive way, the real estate market? Real rates, real rates are explosively high right now. We're in deflation today. I mean, I don't care that they say we have 37 inflation. Go look at that two years. Right? That two years, 350. We have 3% reported growth. Where's the inflation? We don't have any inflation, it's all fake. We're going down in inflation month over month. You've got an owner's equivalent rent, which is fake. You've got investment services inflation, that's fake. No inflation anymore. All the inflation is caused by the belief that there's inflation, and people borrowing and using up capacity. And this is what Trump did. He acts crazy. He's breaking the back. Before you know it, rates are going to break down. But, you look at that 62 going up to 195, that's a triple, and a little spike up. Okay. We went from 38 to 155. I think we'd go to 38. We could go below 38. We could go into the 20s. You know what happens when the move index goes into the 20s? Bonds will be paid. They'll be paid, and people will feel there's no risk in buying bonds. And they're just going to be paying great interest rates. Mortgages, same thing. We'll have more deflation if you look. From 62 to 195 is a triple. We're 38 to 155. Let's do the math. 155 divided by 38. Four. So, we are 33%. We're going to have 33% more squared. We're going to have a lot more deflation than we did then. And this move index is going to keep on going lower and lower and lower and lower. And what's going to happen? That's because two-year volatility is going to keep on rising. And they're going to suck all the volatility out of the bonds. You know what happens when bond volatility collapses? So do yields. That's how we're going to a zero yield, a negative yield. And we're going to be sitting there for years. And then what's going to happen? People are going to want to borrow like drunken sailors. And they're going to start pushing up the two-year yields. And the money supply is going to re-explode. So, do you see the same risk in real estate or not? No. So, what's going to happen when rates are at six, if mortgage rates are at six, they go down to two? Okay. No, yeah. So, yeah, if that happens, yeah, more easy borrowing accumulates. Do we have the most or the least amount of debt since the 1950s? The most. We have the least. You know there's only… But in terms of what? The amount of debt against real estate, residential. Oh, okay, okay, okay, okay, I got it. No, I thought you were talking about government. I actually saw a data point that right now more households own a lot more stocks than real estate. First time ever. First time ever. Yeah, yeah, yeah. I saw a chart. I think… Where do you think a lot of stock sales are going to come from? Parents kicking their kids out of the house now that they can afford it. So, what I'm saying is I'm looking at this chart, it's a derivative chart, and I think it's going to complete the pattern of going to 38 and then down into the 20s. And that is going to mean mortgage rates collapse, the bid for treasuries explodes, and it sucks all the life out of equity beta. So, if you add up the area underneath that spike, that policy spike, that explosion, you're going to have more deflation. And we had a decade then, almost. And the yield curve is going to invert hundreds and hundreds of basis points. And we're going to be shifting to private credit. If… Okay, let's assume everything that happens, how would you approach positioning if you want to accumulate, for example, mostly family asset class in Florida? Like, I mean, I know at the time, like, it's each individual person's financial situation, et cetera, but… Well, I will just tell you what I said publicly, the grains are done. Sorry, I don't know. I didn't hear it. But I'll tell you what I said, the grains are done. I said, the only way to make money in real estate, which is going to be the most attractive it's been of all time, is you have to be able to convert your multifamily debt into adjustable rate, which is not available. Because we're going to have so much deflation, you're not going to get the rental increases that you want. And the supply is going to come out because it will be so cheap. So, what you have to do is you have to learn how to convert your outstanding debt to adjustable rate. And that's the business we're going to be opening. Okay, so I'm trying to understand. The rents are not going to increase as much? As much as you think, because under deflation, your funding costs are low, but you'll not get any rental increases. So, people thinking that they're borrowing at five or six now, that they got a good loan, they're screwing themselves. Because the guy who can borrow at two can charge less rent, and you're going to lose your tenants. Okay, so if rents are not going to increase as they have been in the past ten years, so to say, what about in terms of an appreciation rate using debt in real estate? Are properties still going to have... Properties are going to go up in price like crazy. Because... But what if you're borrowing at six percent now? You're not going to make any money. You'll lose the property. Okay, but appreciation? And we'll still appreciate like crazy, like you said? Yeah, but you think... I get that it'll appreciate, but you won't own it for very long. What if mortgage rates go... You're paying a six percent mortgage, and those rates go to three percent? You're out of business. Right? The value of your mortgage against that property will jump. Because economically, you won't be able to service that debt. So wouldn't it be better to like... Not participate and just wait for the drop? No. No, you'll never get in. That's what I thought. That's what I thought. The model we're doing is we want to create initially... We'll be doing swaps for people or options to... To have a treasury asset go in price high enough to offset the above market rates you're paying for interest rates. Then we want to create a syndicate where we'll allow you to do the adjustable rate and we'll independently do the hedging. And then eventually we want to create, securitize mortgage-backed securities for commercial that are adjustable. Because no one's going to be able to keep their property if mortgage rates drop by three, four hundred basis points. You'll just be competing with people that have a much lower operating cost than you. And you'll lose all your tenants. Do the math. What's the property at a six? What's the property at a three? And how much do you have to charge for rent? And how are you going to keep your tenants? When a guy has a property at three and you have a property at six. You don't. Right? It doesn't matter what the property goes on. You're not going to own it. You're not going to be able to make your debt service. We're going to have a drop in mortgage rates the likes of you haven't seen. So you want to get in and you need to make sure you have a lot of capital, but you're a trader. You'll buy bond futures. You'll buy bond auctions. Right? No, I mean, I invest, but I'm other things too. I'm saying specifically against your property. What is the biggest risk? Higher inflation when you have a property at six. What is the biggest risk? Higher inflation when you have a fixed rate mortgage or lower inflation? Which is the bigger risk? When you have what? When you buy a multi-family with a fixed rate mortgage, which is your bigger risk? Higher inflation or lower inflation? When I get with a fixed? When you buy a property, when you buy a property, you're going to be getting a fixed rate mortgage, correct? Because it's commercial or multi-family. Correct? Correct, correct. So which is your bigger risk? Higher inflation or lower inflation? Lower inflation. Why? Because if inflation goes down, basically, I'm not going to be able to... I mean, what if people refinance when the rate... You can. I just said that. No, I'm trying, I'm trying, I'm trying... No, I just said that. It's not a residential single-family house. You cannot refinance multi-family beyond a certain size. Okay, got it. Got it there. I guess one to four, you can... I guess five plus, you can. Okay, got it. So one to four, it's no problem, right? Yeah, I mean... Yeah. Okay, now I understand because I've never gotten a five plus door yet. So I'm still... Oh, okay. Oh, no, no, no, no. So if you're talking about the one to four, ignore what I just said. You get a mortgage, you can refinance. Thank you for telling me this because I'm trying to get... That's why Leticia James, in my opinion, belongs in jail. And that they should throw out the conviction against Trump because when she said she lived outside of New York State, she immediately surrendered her role. Because in New York, you shall no longer be an Attorney General upon residence outside of New York State. And she wrote under oath. That she lived in Virginia. So she doesn't have the legal authority to go against Trump. Just like they got Pam Bondi to not be able to go after certain people. Or the others. It's the same exact thing. But if it's one to four, gorgeous. Gorgeous, gorgeous, gorgeous, in my opinion. Thank you, thank you. I appreciate you, David. But if you want, but for me, what I was telling Grant, hire us. Fly up to New York. He said he would fly up. Fly up. Great guy. But he got his mortgage, whatever he said publicly, he did. But I think it's an enormous mistake. I think people should engage with QH. And when rates are going down, when rates are going down, we'll open an account. Futures, options, whatever. And by just long dated options, there will go up in price to offset your interest expense. So as rates go down, you'll get capital appreciation on your positions. And that will fund the interest rates more than market rates. It's a synthetic approach. Wow, I understand what you're saying. Because you cannot get adjustable for commercial. Thank you. Wow, no, no. No, that's what I said. If you're a trader and you're able to trade on Apple, it's a lot easier to trade bonds, isn't it? I mean, I've never done that, to be honest. It's a prize. Do you ever trade TLT? No, I just haven't. You should monitor it. It will allow you effectively to learn how bonds behave. And then it will allow you to consider, you know, buying derivatives as a hedge against the greater risk, which is falling rates. Which is why the Fed only does stress tests for lower rates. And only after Silicon Valley banks go up. In my opinion, it was a corruption. It was not an ignorance of that. They didn't hedge properly. They didn't disclose. That's why they went back. But they don't, they don't, they don't, they don't stress test for higher rates. Because when the price of your assets go down, the government just gives you credit against it. Eventually, you pay it back. It's when it goes down that you have the problem. That you have your liabilities, and your cash is the problem. Quick question for the 1 to 4 unit, David. So, if, if, if, because we can refine on the 1 to 4s. So, when taking DSR loans, following everything you're saying, would it be like more smart to negotiate a prepayment penalty to refinance? No, I don't think it's a negotiation. I think it's just embedded in the price. You have the right. What I would be doing is I'd love to get a shorter and shorter, for me, shorter and shorter fixed period. If it's an adjustable. Or, if it's not, just, you know, try to make sure that you go to a lender You go to a lender who will either let you, you know, pay to write down the loans without them losing it. There's going to be a lot of this that goes on, a lot of development. You know, and people wanting to keep the mortgage even if they've got to write down the rate. Like less prepayment points and get the, the next loan with the same lender. Yeah, like, find out if, what, what, what would, what would the mechanics be if it was a big move down in rates? Where we could not have to, we could write down the rate and not have a huge cost. Gotcha. And different places will have different retention approaches. Okay, anyway, folks, I've got to jump on my, my open spaces. You're all welcome to come. It's been fun, it's been exciting. And this is a long recording, holy crap. By the way, everyone, you've got to make sure you have 26.2 on the Safari OIS update. And that will allow you, from what I understand, to be able to get recordings without having for me to put them up in a mess because we don't want to do that.