Midterm Countdown ⏳ Tokenization Leaving U.S. — Transcript

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1. 0:00midterms could be affecting how the
2. 0:01crypto markets lay up and one other
3. 0:03thing is happening and that is
4. 0:04tokenization. Is it on a countdown for
5. 0:08maybe leaving the US? Before we do that,
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20. 0:37reward to get started. And you're going
21. 0:39to have to start tax planning soon. And
22. 0:41IAS are one of the diversification
23. 0:42things that you should be doing to set
24. 0:44yourself up for success. I want to start
25. 0:47with this and that of course is where
26. 0:48the market sensitivity is. And it is
27. 0:51very sensitive right now as we look at
28. 0:53where the stock market is holding. And
29. 0:55this just dipped into the extreme fear
30. 0:58this morning. So we've already seen a
31. 1:01significant amount of fall off in the
32. 1:03S&P 500 and also it has affecting crypto
33. 1:07as well. When you look at that we are
34. 1:09now hitting 34. Last time we had pushed
35. 1:12into that was around August. So, uh,
36. 1:15this is a concern overall, but I think a
37. 1:18lot of people are looking at what's
38. 1:19going on in the midterms and trying to
39. 1:21kind of come to an understanding that
40. 1:23once this is over, maybe there's an
41. 1:25upside to it or maybe things get a
42. 1:28little crazy. And I think that's the
43. 1:30question that we're trying to answer is
44. 1:32where does it go from here? One thing
45. 1:34that is for sure is that we are seeing a
46. 1:36continuation of the bleed and that is
47. 1:393.4 trillion coming off of the AI stocks
48. 1:42in October. You can kind of see the
49. 1:44numbers here guys. These are pretty
50. 1:46amazing numbers. In one month, Intel
51. 1:48down 43%, Cororewe 37, Nebius 36,
52. 1:52SanDesk 33. You can see it. Dell which
53. 1:56had been flying is now down 22%. SK
54. 1:59Highix 19.8%.
55. 2:02Point being and even Micron at 17.8%
56. 2:04down in October. So definitely not a
57. 2:07good month for the AI trade. And how
58. 2:10does this start to move from here? I
59. 2:12think everybody is trying to understand
60. 2:14and there's one thing that starts to
61. 2:16correlate to what's happening in this
62. 2:19market and it correlates to big tech.
63. 2:21Well, if you look at the Senate race
64. 2:23right now that's giving big tech the
65. 2:25chills. It is this one right here with
66. 2:27Sherrod Brown. There's a few things I
67. 2:28want to highlight in this article. It's
68. 2:30a high stakes gamble for Silicon Valley
69. 2:32Titans that is making some of the tech
70. 2:35world very nervous. And that's in
71. 2:36reference to this mainly because Gerard
72. 2:38Brown a victory could undermine crypto's
73. 2:41vaulted political operation and offer a
74. 2:44new playbook uh which could get very
75. 2:47concerning around the issue with AI data
76. 2:50centers. So, and I'll talk about that in
77. 2:52a second because I think this may spin
78. 2:53two ways even if the Democrats win uh
79. 2:56both the House and the Senate. And then
80. 2:58last up was this right here. This is
81. 3:00definitely the most important race at
82. 3:03least in this current landscape in terms
83. 3:06of dictating the attitude towards tech
84. 3:08and crypto for the next Congress. And
85. 3:11that of course by Ron Hammond we're
86. 3:12going to have him on tomorrow. He'll
87. 3:13talk a little bit about that. And
88. 3:15remember this is because this was under
89. 3:17the Senate Finance Committee and this is
90. 3:19kind of the I won't say the Dboy for
91. 3:23Senator Warren but for the most part yes
92. 3:25he has been the puppet of Senator Warren
93. 3:27and I think this will only continue. So
94. 3:30watching that race is a huge issue. Uh
95. 3:33right now as you look at the Senate
96. 3:36race, 74% highest it's been ever of the
97. 3:40Democrats taking the Senate and running
98. 3:43a full blue wave across both the Senate
99. 3:46and the House, which would put the Trump
100. 3:48administration reeling in trying to deal
101. 3:51with how the Senate and the House would
102. 3:54go to market basically in DC around the
103. 3:58things they're going to do. uh to run
104. 4:00Congress over the next several years. So
105. 4:03you've got that and then you have the US
106. 4:05Iran deal being dumped into the market
107. 4:08and that of course changed things up
108. 4:10because USIran deal and manufacturing
109. 4:12data was beating expectations slightly
110. 4:16up today and we the big one was really
111. 4:18oil and I'll show you that in a second
112. 4:20that started to do a pivot based on just
113. 4:23hearing and again this is you know maybe
114. 4:24the 12th deal that we've seen. I want to
115. 4:26go to a clip real quick. This is Mike
116. 4:28Mcloone and he's talking about being
117. 4:30very careful around a post-midterm
118. 4:32rally. Take a look.
119. 4:34>> When everybody says the same thing for
120. 4:35the same narrative, be careful. And
121. 4:37that's the key thing I'm worried about
122. 4:38is for this week right now, our macro
123. 4:41Mondays is not as important. But next
124. 4:43Monday's macro monies Monday is going to
125. 4:45be very important. The bottom line is
126. 4:46will the S&P 500 be down from where we
127. 4:49are now? If it's down, that's the
128. 4:51beginning of a me potential biggest
129. 4:53reset of a lifetime, just normal
130. 4:55reversion. Now we've pretty good
131. 4:57significant peak in precious metals.
132. 4:58They've just got support got to support.
133. 5:00We've had a significant peak in in in
134. 5:02cryptos, Bitcoin. They've got to support
135. 5:04levels. We're all know the housing
136. 5:05market's rolling over significantly.
137. 5:07Certainly with, you know, mortgage rates
138. 5:09at a third three decade high. Energy
139. 5:12looks like it's probably just peaked
140. 5:14very significantly. Natural gas is a
141. 5:16great indication for that. Um so that's
142. 5:18a deflationary force. The bottom line is
143. 5:21if the stock market ends this week down,
144. 5:24it's a go with it's significant. If it
145. 5:25goes up, I don't really know what to
146. 5:27change or what to do. So, maybe guide me
147. 5:29a little.
148. 5:30>> All right. So, some things you could
149. 5:31look at, and I've got a couple more
150. 5:33clips here that will show you maybe the
151. 5:35bullish potential signals to watch for,
152. 5:38but also some of the things that are a
153. 5:40bit more concerning like what Mloone was
154. 5:41talking about, oil and energy being one
155. 5:43of them. Whether or not we've hit the
156. 5:45peak, I think, is still a question mark.
157. 5:47But oil plunged another 7% down 98 a
158. 5:50barrel. Brent falls five. So all of this
159. 5:53especially around what's going on with
160. 5:55the negotiation in Iran and I think
161. 5:57still a lot of people are concerned that
162. 5:58there might be something happening after
163. 6:01the midterms of how the US is going to
164. 6:03deal with Iran. So are we still in a
165. 6:06potential where that could cause a major
166. 6:08hit? If you look at oil over uh the long
167. 6:11haul, this was the big dip right here
168. 6:13that everybody is talking about. You
169. 6:15would think that the market would have
170. 6:17responded much more positively. The one
171. 6:19thing that did respond was gold up 2%
172. 6:22also following right there with oil. And
173. 6:25if you look at silver coming up 3%.
174. 6:28These are the kind of things that
175. 6:29Mcloone was kind of getting at. Other
176. 6:31things that kind of play into this.
177. 6:33Speaking of gold, there's Peter Schiff
178. 6:34talking about it. And that is in
179. 6:36reference to his thought that this is a
180. 6:38manipulated oil market for the financial
181. 6:40gain of insiders, especially around the
182. 6:43advanced knowledge of some of these
183. 6:45positions that the US is posting around
184. 6:49Iran. Imagine if you're an oil trader
185. 6:51and you've got insight to that. This is
186. 6:53like a money printer for you because
187. 6:55we've seen nothing but whipsaw after
188. 6:58whipssaw that has affected the oil
189. 7:00market and of course that affecting the
190. 7:02US gas prices. Let me go to a tweet here
191. 7:04because this is where it gets a little
192. 7:05crazy. This is of course Tucker Carlson
193. 7:08claiming that Netanyahu has somehow put
194. 7:12some pressure on Trump to possibly put
195. 7:15the United States within days of
196. 7:17launching a nuclear strike on Iran. This
197. 7:20is the kind of thing that I think starts
198. 7:22to really get crazy. And if you read
199. 7:24this, I think more of a rant, but the
200. 7:26point is is this rant got 60 million
201. 7:29views right there, guys. So it is
202. 7:31something that I just think when you
203. 7:33look at where the sensitivity of the
204. 7:35markets are right now. You look at what
205. 7:38is happening right now with the midterms
206. 7:40and whether or not that does go to a
207. 7:41blue sweep and what's happening in Iran
208. 7:45along with the macro pressure globally.
209. 7:47Things could get a little unusual. Now
210. 7:49the market's still saying well listen if
211. 7:51we get the midterms and we get the
212. 7:53Democrats in I think the market is
213. 7:54pricing that in and maybe in a position
214. 7:57where it's only going to go up from
215. 7:59there. I'm concerned more around could
216. 8:01something unusual happen that puts more
217. 8:03pressure on the market and I think
218. 8:05Mcloan was right in that last clip is
219. 8:07that next Monday the end of this week's
220. 8:10closing is going to be critical for the
221. 8:12markets going forward. Speaking of that,
222. 8:14you've got uh critical things happening
223. 8:16in Israel right now and that is the fact
224. 8:18that we've got a different potential
225. 8:21party taking the lead again and this has
226. 8:24been one of those weird things because
227. 8:25it's been swapping back and forth. You
228. 8:27can kind of see there on the chart of it
229. 8:30going back and forth between uh Ezen and
230. 8:33Netanyahu. And I think the point behind
231. 8:35this could be correlated, call me crazy,
232. 8:38correlated to the midterms, finding out
233. 8:40who wins, understanding how to deal with
234. 8:42the United States because obviously
235. 8:44Israel significantly tied to the US in
236. 8:48terms of strategy and potentially going
237. 8:50forward on how the policy is going to be
238. 8:53met with Israel. So many things
239. 8:55happening right now. Let's take a look
240. 8:56at this. This, of course, is Trump
241. 8:58coming out saying it's going to be Mr.
242. 8:59veto if the Democrats do take control of
243. 9:02Congress. And that is the key thing. He
244. 9:05says he'll block every damn bill passed
245. 9:07until they give up and make a deal. He
246. 9:10also agreed with Elon that the
247. 9:11Democratic sweep could leave the
248. 9:12country. Uh may be forever destroyed.
249. 9:16These are the kind of things coming out
250. 9:17of the White House right now. President
251. 9:19Trump also promises to protect Elon if
252. 9:21Democrats threaten Tesla and SpaceX. So
253. 9:24apparently they've got a pass right now.
254. 9:26Speaking of that, there's further passes
255. 9:29being handed out with the president
256. 9:30making it clear he'd consider pardons
257. 9:32for his staff. So this is already, it
258. 9:35sounds to me, like a White House
259. 9:37administration that has conceded defeat
260. 9:41or at least understands that there's a
261. 9:43high probability that this is going to
262. 9:45occur. And this does start to change
263. 9:48things for sure uh I think going forward
264. 9:51in the markets. And the real question is
265. 9:52is are we going to go up or are we going
266. 9:54to start to see some sideways action
267. 9:55through the end of the year? I think if
268. 9:58we get a dem sweep and there's no funny
269. 10:00business then we may have an opportunity
270. 10:02here for a market recovery. But those
271. 10:04are the key terms right there guys.
272. 10:06Other things that concern me around a
273. 10:08market recovery is what's happening
274. 10:10around all these hacks. So you've got
275. 10:12Zach XBT saying there was an EU entity
276. 10:16now suspected of losing 106 million from
277. 10:18multiple centralized exchange accounts
278. 10:20on November 1st. just this day and
279. 10:23you've got a variety of different hacks
280. 10:25coming on and it's several of them. I'll
281. 10:27just show you some of them. This was
282. 10:28Brazil's top crypto exchange. This was
283. 10:30Marcato. They confirmed a security
284. 10:32breach. Then you had BTC Pay server.
285. 10:35This one is a big one because it's a BTC
286. 10:38Pay just so you understand this is where
287. 10:40merchants are operating. Think of this
288. 10:42as the stripe for crypto in essence or
289. 10:45one of and it'd be like uh Coinbase
290. 10:47Commerce or something where those
291. 10:49wallets would become potential targets
292. 10:52of hackers because these are the wallets
293. 10:55of retailers who might be using Bitcoin
294. 10:58or other payment processors out there
295. 11:00for these kind of things. This is a big
296. 11:02one because it does start to put a
297. 11:04little bit of a thart in retail adopting
298. 11:08crypto as a payment source if these kind
299. 11:09of issues start to continue to happen.
300. 11:12All right, so let's just jump over and I
301. 11:14want to go to this tweet because this is
302. 11:15the point that uh I'm getting at because
303. 11:18there are some signs here that the
304. 11:19market could be nearing a bottom.
305. 11:21There's equal weight there on the S&P.
306. 11:24You've got yields and oil falling. How
307. 11:26long is the question? You have some fund
308. 11:29managers positioning near extreme risk
309. 11:31off and that's the key. And then you
310. 11:34have crypto barely declining despite its
311. 11:36biggest heist. All right. And I would
312. 11:38agree with that one. Those are the ones
313. 11:39that I I do agree with. And then you
314. 11:41have stocks near the bottom. We just
315. 11:43looked at the list of October declines.
316. 11:46I mean, these are significant in terms
317. 11:48of the AI trade and it's moving into a
318. 11:51midterm cycle while all of that is
319. 11:53happening. So, the probabilities for an
320. 11:55upside at least are lining up. I want to
321. 11:58go to a clip here by Tom Lee that
322. 11:59explains this.
323. 12:01>> You're not jumping up and down like
324. 12:03sometimes you do, but you still think
325. 12:05maybe 8,200 by the end of this year.
326. 12:09>> Yeah, I think we're okay.
327. 12:11>> I do think markets are going to exit the
328. 12:13year strong, but they have been
329. 12:16struggling. you know, like underneath
330. 12:18the surface, it's been a real battle.
331. 12:19And I think everyone I speak to is
332. 12:22nervous about one of many things, right?
333. 12:24The war, AI spending, the debt markets,
334. 12:28the Fed, inflation, midterms, and I
335. 12:32think the markets held up really well in
336. 12:34the face of all that. Correct. I think
337. 12:36markets in some ways prefer gridlock
338. 12:38because then you don't have too much
339. 12:39policy creep. But I I'm going to take
340. 12:42the contrarian view that Democrat House
341. 12:45Democrats will support AI
342. 12:48post midterms because it does bring
343. 12:50money to their communities. So I think
344. 12:51it's sort of a an important voting issue
345. 12:54today, but I think at the end of the day
346. 12:56it's good for jobs and it's good for the
347. 12:58economy.
348. 12:59>> All right. So a couple of things that he
349. 13:01hit on there is yes, there's a lot of
350. 13:03macro headwinds. Uh you do have some
351. 13:06interesting timing though that is lining
352. 13:08up with midterms and I think that's been
353. 13:10almost architected by the way markets
354. 13:12play out and then you have the AI trade
355. 13:15which could be a big deal and I think
356. 13:17that still has a play uh going forward
357. 13:20and I think he's right. I think the the
358. 13:21Dems win there's going to be a little
359. 13:24bit of an about face on it. Maybe not
360. 13:26because it's good for the communities
361. 13:27but I believe corruption wins
362. 13:29unfortunately.
363. 13:31You look at this right here. Bitcoin's
364. 13:33last three cycle bottoms came shortly
365. 13:35after midterm elections. You had the
366. 13:372014 cycle bottom 71 days later, 39 d
367. 13:41days later in 18 and then in 22 13 days.
368. 13:45So that could be a signal as well if you
369. 13:48cons consider the potential here. And
370. 13:50that's not all. Look at this S&P 500
371. 13:53returns in November June. This is
372. 13:55following the midterm elections. The 21
373. 13:58out of 21 hits, guys, were positive.
374. 14:02That's a pretty insane record. Now,
375. 14:04granted, you could say, "Well, we're in
376. 14:06for one that could go the other way now
377. 14:08just because of the odds alone, but a 21
378. 14:10for 21 of positive S&P 500 returns.
379. 14:14Pretty significant. Look at these
380. 14:16numbers, though. I mean, some of these
381. 14:17were crazy. 1998 up 24%.
382. 14:21Unbelievable. 15% in 22, 2018.
383. 14:25You can go all the way back even into
384. 14:27the 80s at 25% in 1982, which was during
385. 14:30one of the biggest uh inflationary
386. 14:32periods and interest rate hikes that
387. 14:35were happening to American people ever
388. 14:36in the history of commerce. Other points
389. 14:39I want to hit on right here is what
390. 14:41happened with Binance because this is
391. 14:42the update right now. Binance users
392. 14:44holding any of these 10 tokens can
393. 14:47independently verify their balances on
394. 14:49Binance and are backed a minimum of one
395. 14:52to one. They were using zero knowledge
396. 14:54to basically do this. The point is is
397. 14:56that CZ is is not concerned at all. In
398. 14:59fact, he tweeted this 12 hours after the
399. 15:02withdrawals resumed only 2.1% net
400. 15:05outflow. So, people are feeling as
401. 15:08though they are safe. 98% choose to
402. 15:10stay. Speaking of where the market could
403. 15:13be going, here's Matt Hogan. He talks
404. 15:14about his strategy on how we could
405. 15:17actually come back. Take a look. And
406. 15:19again, the ability for Binance to make
407. 15:22users whole is another sign that this
408. 15:24industry is maturing. I'd also add that
409. 15:26I think a lot of the pullback today was
410. 15:28not in fact driven by this hack
411. 15:30exclusively, but also by the broader
412. 15:32riskoff appetite. And in fact, I think
413. 15:34in a week you'll see, you know, prices
414. 15:36have moved beyond this and and recovered
415. 15:38from this. At least historically, hacks
416. 15:40haven't had a huge impact on the
417. 15:41long-term trajectory of prices. I expect
418. 15:44that to be true here as well.
419. 15:45>> All right, so a couple of things there.
420. 15:46I think price does get impacted. That
421. 15:49hack did impact Bitcoin. In fact, it
422. 15:51pulled it down under 80K. So, I disagree
423. 15:53with Matt with that. Now, does this mean
424. 15:56that that was a good pullback based on
425. 15:59the impact of a hack? Sure, I would
426. 16:00agree with that is that it could have
427. 16:02been a lot worse. It wasn't. And crypto
428. 16:05was very resilient in general, but I
429. 16:07think the key here is going to be how
430. 16:09the market plays into the macro
431. 16:11scenarios. Obviously, the midterms. I'm
432. 16:14still concerned about what's going on in
433. 16:15the Middle East and with energy prices.
434. 16:17All of those correlated coming into the
435. 16:20end of this year is the key factor. I
436. 16:22think that has more bearing on if we're
437. 16:24bullish or not after the midterms than
438. 16:26anything. Probably not so much the hack.
439. 16:29Speaking of being bullish, you've got to
440. 16:31consider where RWAS are going to be and
441. 16:34just tokenized securities in general.
442. 16:36You've got 50 major US companies now
443. 16:38opposing to have their stocks tokenized
444. 16:41on on the OKX NIS planned exchange. And
445. 16:44there's major names in here, guys. You
446. 16:46just look at it. IBM, Dell, Nike, Intel,
447. 16:49Nvidia, Oracle, Costco, Verizon, the
448. 16:53list goes on. 50 of them, including
449. 16:55Microsoft, JP Morgan. And I think the
450. 16:58concern right now I have is if we
451. 17:01continue to see this push back from
452. 17:03major companies, what happens if we
453. 17:06start to see a contagion effect of
454. 17:08nobody wanting this in the US and it
455. 17:11pushes tokenized stocks offshore? That's
456. 17:15the concern that I think everybody is
457. 17:17worried about. All right, just so you
458. 17:19guys know, the OKX ICE deal, it had a
459. 17:2230-day notice period. So it was filed on
460. 17:24October 3rd. that's going to push it in
461. 17:25here to, you know, the beginning of
462. 17:27November. This could also get a 30-day
463. 17:29exemption. So, this could push it all
464. 17:31the way up to November 22nd if the SEC
465. 17:35sees this as a potential problem and
466. 17:38changes maybe the date. And I think this
467. 17:41is more u something to watch than almost
468. 17:44anything right now in the market,
469. 17:45especially around tokenized treasuries.
470. 17:47So, keep a very close eye on how that's
471. 17:49going to play out. Now, these are the
472. 17:52companies that are actually at least not
473. 17:55opposing, but they haven't just said,
474. 17:57"Hey, yeah, we want to." But the point
475. 17:58is they have not objected or at least
476. 18:00not yet. And you've got Apple, Amazon,
477. 18:03Tesla, Netflix, Palunteer, a handful of
478. 18:06others, Coinbase, obvious
479. 18:11that understand how this could benefit
480. 18:13their business. But more importantly,
481. 18:16maybe it sets the rest of these
482. 18:18companies up to maybe change their mind.
483. 18:20Now all of this is pending on two
484. 18:23things. One, how does the performance of
485. 18:26tokenized treasuries work in terms of
486. 18:28actually getting this done? If OKX
487. 18:31actually goes out and succeeds with
488. 18:33this, that will be a major bellweather.
489. 18:36And I think the other factor is just
490. 18:37whether or not the market itself starts
491. 18:39to adjust and we see an upward trend
492. 18:42come off of what could be moving into at
493. 18:45least an upswing on the market in
494. 18:47general.
495. 18:48Speaking of what's happening overseas,
496. 18:50you've got HSBC's Hong Kong dollar just
497. 18:52launched the stable coin Redcoin. It
498. 18:54hits 50,000 users in its first week. We
499. 18:57reported this last week is that Hong
500. 18:59Kong is continuing to accelerate as is
501. 19:01Asia, Japan, and many others who are
502. 19:04moving quickly into tokenized
503. 19:07treasuries, stable coins used as
504. 19:09denominated assets for almost anything
505. 19:12you want, including integrating into a
506. 19:14lot of commerce. So things are changing
507. 19:16in Asia Asia while the US is still very
508. 19:19slow to react with no real action coming
509. 19:22off the clarity act and now push back
510. 19:25from Wall Street around tokenized
511. 19:27treasuries. South Korea is trading ono
512. 19:30like the rest of the world missed the
513. 19:31memo. It's now 62 times its overseas
514. 19:35share on October 31st. This is the
515. 19:37biggest gap among 52 different tracked
516. 19:40tokens out there. So again, South Korea,
517. 19:43another major mecca where we're starting
518. 19:46to see activity. The real question I
519. 19:49think, does Asia, and this is one I've
520. 19:50asked many times, does Asia become the
521. 19:52crypto mecca of the world going forward?
522. 19:55Last up right here is going to hit the
523. 19:57market in a big way. One way or the
524. 19:59other, it could be that Anthropic's Q3
525. 20:03revenue right now, which is surged
526. 20:05dramatically to nearly 17 billion from
527. 20:081.4 4 billion last year and it's getting
528. 20:11ready to hit the open stock market. The
529. 20:14real question will be what is the
530. 20:15valuation of this company? Does it
531. 20:18exceed the 1.4 trillion that was
532. 20:20targeted and start to see and
533. 20:22accelerate? If it goes above that, if we
534. 20:24see a two trillion or higher, that's a
535. 20:26very very bullish scenario for the
536. 20:29market in general. It means the AI trade
537. 20:31is back. If it sucks in underneath that,
538. 20:35that's the question I think everybody's
539. 20:36going to be asking. Is the AI trade
540. 20:38finally over? We're going to be watching
541. 20:40this very closely, so stay tuned.
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