#802: The Banks Are Fleecing You with Mel Mattison

Mel Mattison (0:07)

You've had a dynamic where money has become freer than free.

SPEAKER_2 (0:10)

When you talk about a Fed just going nuts, all the central banks going nuts. So it's all acting like safe haven.

SPEAKER_3 (0:18)

I believe that in a world where central bankers are tripping over themselves to devalue their currency, Bitcoin wins. In a world of fiat currencies, Bitcoin is the victor.

SPEAKER_2 (0:29)

I mean, that's part of the bold case for Bitcoin.

SPEAKER_3 (0:31)

If you're not paying attention, you probably should be.

SPEAKER_2 (0:34)

You probably should be.

Marty Bent (0:36)

Mel, as you were just saying, we seem to gather here during times of market tumult. What the heck is going on?

Mel Mattison (0:44)

We've definitely had a lot of it this year. And I think that's important to keep in mind when these things happen, because it's like we were talking about, we did one at the end of the first quarter, in the throes of the Iran war sell off, and literally within weeks, we were basically back to flat on the year and then moving to all time highs within basically six or seven weeks, in one of the most impressive bull runs in probably equity market history. So these things turn around very quickly, and I think we're in the middle of another one of those emotional, I think it's kind of a time of indecision, because there's just so many moving pieces on the chessboard right now, that investors are having a little paralysis and saying, well, where do we put money in the last couple of days, that's been bonds and gold basically and sell everything else.

But we've got midterm elections coming up. We've got an Iran war in flux. We've got a bunch of turmoil still in Europe with the Ukraine war. We've got turmoil in Europe with their fiscal situation. We've got a front runner in the French presidential campaign. You got Marie Le Pen on the right, and you've got this other guy, Melacon, on the left, that literally wants to imprison the head of the French central bank and declare all French debt void held by the French central bank.

That's just to name a few. We could go on, and I haven't even mentioned what's happening in the AI world, which of course is what's also dominating this recent sell-off. So when you put that whole mix together and then earnings are on the horizon, the big ones start next week with Meta and Netflix. So when you put all of this on the horizon, it's not surprising that people are like, well, maybe I should take some profits, maybe these yields look good in bonds, maybe I should invest in an asset like gold, it's basically been doing nothing but going down all year since it peaked in January. So I think we're seeing a little bit of a flux, and that's just a short-term tactical. But I think strategically, the main drivers of what's been driving this market are still in effect. And that's AI, that's semiconductors, that's the NASDAQ, and increasingly that's Bitcoin and crypto being merged with the AI trade, which I think is why you've seen Bitcoin sell off in the last few days is it's getting very tightly correlated with that now. And so all of this is going on, we can unpack a lot of it, but there's definitely a lot on the horizon. But I think this is setting up to be one of those opportunities, probably the best buying opportunity of the year since the Iran war sell off at the end of March.

Marty Bent (3:55)

Yeah, let's start with yields, because in the Bitcoin space, and this is something I've tried to become more nuanced around this year, particularly shout out to John Arnold from 1031 We do our Monday show and he's really been on top of this. And yields have been drifting higher, obviously. And I think two weeks ago, they hit a point where people like, okay, this is the great debt spiral coming. But it doesn't seem like that is the case. We had a conversation with Tom Luongo last week, in which we basically walked through yields, particularly on a relative basis to other government debt around the world. And even though yields are drifting higher, it looks like they want to go into a structural bear market. Everything seems to be relatively okay. If you were to tell me three years ago that yields would be at 5.5%, 10-year, 30-year, 10-year above 5%, I would have been like, okay, we're in a cataclysmic situation. But it seems like despite that, the economy is chugging forward.

Mel Mattison (5:02)

Yeah, I think that, I think with yields, it was a couple of weeks ago.