Speaker 1: Let's get into a US treasury boom that is looming today.
Speaker 1: I'm going to break it down for you. There is
Speaker 1: a lot happening in the market. You've probably heard me
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Speaker 2: Let's just get right into it.
Speaker 1: I want to lead off here with this tweet right here,
Speaker 1: and this of course by Secretary Peasant, and he hits
Speaker 1: on a couple of points here, and one of the
Speaker 1: things is all centered around the Japan carry trade potential
Speaker 1: and what this looks like. But we strongly support Japan's
Speaker 1: decisive market and monetary steps to correct the substantial undervaluation
Speaker 1: of the yen. This has been something that has been
Speaker 1: and brewing, and it's something even I was tweeting about
Speaker 1: earlier this week is watch his next moves, and his
Speaker 1: next moves have started to move because you've got the
Speaker 1: Japanese yen now hitting a forty year low, and if
Speaker 1: Japan were forced to liquidate a meaningful portion of his
Speaker 1: treasury holdings right now to fund the continued intervention, that
Speaker 1: level of selling would undoubtedly.
Speaker 2: Push treasury prices lower and yields higher.
Speaker 1: So this is something that we've kind of looked at
Speaker 1: in the industry for quite some time. If you go
Speaker 1: in here and look at the chart, you can see
Speaker 1: the amount of US treasuries held by investors in Japan.
Speaker 1: Primarily you've got Japan leading their way, United Kingdom, China,
Speaker 1: and Belgium top four, but the Japanese are the ones
Speaker 1: that have the most exposure to US treasury. What does
Speaker 1: all this mean when you consider the liquidity that could
Speaker 1: pour into the market. All of this centered around one
Speaker 1: or two things, and part of this is going to
Speaker 1: be the connection between treasuries and the yen. Here, of course,
Speaker 1: was an interesting photo that was taken, and it was
Speaker 1: during a conference where Bessett basically made one note, I'll
Speaker 1: zoom in onto it for you right there by the
Speaker 1: end JPY five to ten bill. This is the point
Speaker 1: I'm getting at, guys. We are maybe encroaching an area
Speaker 1: of a market position, especially where Crypto was. And I'll
Speaker 1: show you something on the chart that has an eerie
Speaker 1: similarity that could mean we could be prepping up for
Speaker 1: a run here. But before we do that, I want
Speaker 1: to show you a couple of clips here. This is CNBC.
Speaker 2: Take a look.
Speaker 3: You're a slide dog when you wrote that down by
Speaker 3: five to ten billion and the printing.
Speaker 2: Looked so big. You've done this before?
Speaker 3: Ham you where you know people are looking over your shoulder?
Speaker 3: Did you need to be reminded of things to do?
Speaker 3: Buy ten to billion? Five to ten billion and yen
Speaker 3: tell me what was really going on there?
Speaker 4: The second well, I just wanted to make sure that
Speaker 4: all the reporters looking over my shoulder also knew the
Speaker 4: symbol JPY for the Japanese.
Speaker 1: Yet you have to look at this right here, and
Speaker 1: that is Japan's wealth is now returning to Japan, and
Speaker 1: it may be by any means possible. This of course
Speaker 1: has been done and centered around the Bank of Japan.
Speaker 1: This is why I think you saw best and a
Speaker 1: good example of that right there. Further into this, this
Speaker 1: is the interesting point right to in Japan's era of
Speaker 1: low interest and rebuild the nation's wealth or continue yielding
Speaker 1: to a current pressure of the United States at the
Speaker 1: expense of Japan. So this is the challenge. And as
Speaker 1: you guys remember, we've done a whole slew of videos.
Speaker 2: I'll show you here in a minute.
Speaker 1: But the point is is that Japan is very centered
Speaker 1: around digital assets right now. It really matters because this
Speaker 1: could be everything where we get the carry trade now
Speaker 1: coming on chain. I want to play a clip for
Speaker 1: you by Andre Jick that kind of goes into that
Speaker 1: take a look.
Speaker 4: And that is why. On July twentieth, Japan passed something
Speaker 4: that's being called their version of America's Clarity Act, which
Speaker 4: means crypto in Japan is now legally recognized as a
Speaker 4: financial asset, which also means Japanese banks can now hold
Speaker 4: those assets. But even more importantly, they're using crypto as
Speaker 4: a means to offload their debt onto the world and
Speaker 4: their own companies. Then August twenty twenty four, the Bank
Speaker 4: of Japan increased interest rates by just a little a
Speaker 4: quarter of one percent. The yen went up and a
Speaker 4: part of that carry trade started to unwind, and in
Speaker 4: one day, Japan's stock market went down twelve percent, the
Speaker 4: worst day since nineteen eighty seven, and the US stock
Speaker 4: market went down three percent. Millions of people here in
Speaker 4: the US watched their portfolios lose money that day with
Speaker 4: no idea what was happening. Nothing happened in the US,
Speaker 4: but something was happening in Japan, all right.
Speaker 1: So the point if you look at back in that area,
Speaker 1: which was on August fifth, twenty twenty four, this is
Speaker 1: what was going on in crypto, specifically big coin, and
Speaker 1: you saw that master Wick where bitcoin dropped under fifty thousand,
Speaker 1: and it happened for is a very short period of time.
Speaker 1: We saw a little bit of a market correction. But
Speaker 1: I want to show you something right here. This is
Speaker 1: what happened after that. This is the liquidity flow that
Speaker 1: we're talking about. This is maybe a scenario where Japan
Speaker 1: could be leading its way. And the difference between August
Speaker 1: of twenty twenty four and where we are right now, well,
Speaker 1: Japan has completely architected a digital assets framework.
Speaker 2: That is the big difference here.
Speaker 1: So now they actually have a gateway and we have
Speaker 1: put video after video talking about this. Guys, if you
Speaker 1: have been following this, I mean it has been over
Speaker 1: I don't know a dozen videos that we've been focusing
Speaker 1: on for over the last year, focusing on where the
Speaker 1: potential future of where this is heading, and right now
Speaker 1: I think we are very close to it. Other things
Speaker 1: right now, you've got to look at what's going on
Speaker 1: in the traditional markets. Of course, is Blackrock, which is
Speaker 1: getting much more active and in reference to two funds
Speaker 1: that they've pretty much launched here somewhat in competition with
Speaker 1: Strategy here, but they intend to qualify both of these
Speaker 1: as eligible reserve assets for US payment stable coin issues.
Speaker 2: This of course is all related to Genius Act.
Speaker 1: You've got Blackrock doing this and dropping this today on
Speaker 1: the week that we may or may not get clarity
Speaker 1: as Blackrock knows something. Why are these tied so quickly
Speaker 1: to exactly what the stable coin bill was really created around.
Speaker 1: So remember this is both on Ethereum and on Solana,
Speaker 1: And if you look at this right here, Solana kind
Speaker 1: of showcases this Blackrock file with the sec The issue
Speaker 1: at the token is fund shares on Solana fifteen trillion
Speaker 1: in AUM assets under management. This is going to be significant,
Speaker 1: and the push that this could put on the market,
Speaker 1: including what Strategy was trying to do obviously with bitcoin,
Speaker 1: may start to center around Solana and Ethereum.
Speaker 2: Now, I want to show you one thing right here.
Speaker 2: This is another example.
Speaker 1: Something that happened with Strategy not too long and that
Speaker 1: was the threat of the MSCI delisting strategy and the
Speaker 1: potential impact. Notice that the ones that they're targeting right there, Metaplanet,
Speaker 1: yellow Cake Strategy, all these Bitcoin and then even Sharplink,
Speaker 1: which is e that's.
Speaker 2: On the watch list. But this is the point I'm
Speaker 2: getting at.
Speaker 1: Maybe there is some sort of very unique or eerie
Speaker 1: coincidence here that this is all coming together at this
Speaker 1: time when in fact you've got Strategy selling more bitcoin
Speaker 1: than it has ever sold ever and has not been
Speaker 1: a buyer of bitcoin in the last several weeks, So
Speaker 1: be on the lookout. Master is selling bitcoin every month
Speaker 1: since June. Right there's the chart just to kind of
Speaker 1: give you an example of it. Three big red weeks.
Speaker 1: So this is the thing to continue to watch at
Speaker 1: right now. And there has been a lot of analysis
Speaker 1: on this that is kind of pointing in this direction.
Speaker 1: So there may be a market vacuum that could be
Speaker 1: fit by Ethereum and Salana.
Speaker 2: So let's stay on ethereum real quick.
Speaker 1: I want to showcase Ethereum over bitcoin and why this
Speaker 1: might be a play.
Speaker 2: Here's a clip. Take a look.
Speaker 5: Crypto has been in a ridiculous bear market for a
Speaker 5: very since since October, so we're coming up on ten
Speaker 5: months now of bear market. Bitcoin bottomed, a lot of
Speaker 5: other cryptos haven't, and that's very very true. I mean,
Speaker 5: the dichotomy is there. I mean, we saw a rally
Speaker 5: of ethereum versus Bitcoin last week. It kind of bounced
Speaker 5: off the point zero three level and it's now point
Speaker 5: oh two nine and a half or below. You know,
Speaker 5: why does this matter. It's because, well, Tom Lee has
Speaker 5: been buying while Salor has been selling, and so that's
Speaker 5: probably the biggest reason for that. So it's you know,
Speaker 5: liquidity does tend to trump things.
Speaker 1: All right, so he does hit on it right there.
Speaker 1: Liquidity is the big player and that is one of
Speaker 1: the keystones of where Tom Lee has built his business around. Remember,
Speaker 1: his situation is completely different than that of Strategy, which
Speaker 1: is one where there are ar income and being able
Speaker 1: to actually put that income to work, so completely different
Speaker 1: situation here.
Speaker 2: All right, so let's jump over to Ripple.
Speaker 1: This course is Monica Long kind of hitting on her goal,
Speaker 1: and Ripple's goals continue to become a full stack digital
Speaker 1: asset infrastructure. A couple of moves they've made, of course,
Speaker 1: one is investing in Xilo and the other is into Liquido.
Speaker 1: Interesting name, as we may get a lot.
Speaker 2: Of Liquido into the market.
Speaker 1: But the point being is that this could be moving
Speaker 1: in a direction that is now somewhat competitive with Blackrock.
Speaker 2: As you can see.
Speaker 1: Here, State Street was one of the Series A investors
Speaker 1: with Zilo, and this is a big deal because that's
Speaker 1: almost sixty trillion in assets under management. You look at
Speaker 1: this right now, this is clear that we are talking
Speaker 1: about Ripple trying to go head to head with some
Speaker 1: of the biggest ones out there. Remember State Street being
Speaker 1: why holding in there, But of course Blackrock also starting
Speaker 1: to enter.
Speaker 2: This place as well.
Speaker 1: I want to play a clip for you though, because
Speaker 1: this will get into maybe how the market will respond
Speaker 1: to this, because this is the thing everybody's watching right now.
Speaker 2: You're looking at what's going on in Japan.
Speaker 1: You're seeing all of these major financial institutions in social
Speaker 1: capital preparing for something?
Speaker 2: What are they preparing for? Tom Lee sets it up?
Speaker 3: You shook me. What was the draw down? You said,
Speaker 3: I could have gotten to a six handle on the
Speaker 3: S and P based on the numbers you were talking.
Speaker 6: Yeah, something they'll feel like a bear market, you know,
Speaker 6: ten percent kind of draw down.
Speaker 3: That's what you thought that it did get down about
Speaker 3: seventy two hundred, nowhere near six.
Speaker 6: Now is that enough?
Speaker 3: Now?
Speaker 2: You know?
Speaker 6: I think August is a month to recover. What how
Speaker 6: June and July have been sort of flat months, but
Speaker 6: earnings have your investments have gone up a lot, So
Speaker 6: the stock market's kind of a coiled spring. So I
Speaker 6: think the markets could actually rebound strongly this month, like
Speaker 6: maybe we get to seventy eight hundred.
Speaker 3: Is that forecast for the ten percent draw down still intact? Yes,
Speaker 3: it is.
Speaker 6: Yeah, So because as we start to look at twenty
Speaker 6: twenty seven, there's a lot of the clouds that are
Speaker 6: heading this year kind of lift. You know, the SpaceX
Speaker 6: unlock will be behind us, and the market testing of
Speaker 6: the new FED will be behind us, so I think,
Speaker 6: and then of course there's already been a leverage online,
Speaker 6: So I think twenty twenty seven could be one of
Speaker 6: the best cheers for the stock mark.
Speaker 1: All right, So Tom kind of hits a couple of things.
Speaker 1: He says there that remember, and we've talked about this
Speaker 1: before on the show, is that he's been anticipating a
Speaker 1: pretty big drawdown. The drawdown they were kind of narrowing
Speaker 1: in on wasn't as large as maybe as Lee as
Speaker 1: thought it was going to be. Doesn't necessarily rule it
Speaker 1: out just yet, but also positions August as maybe a
Speaker 1: month for a recovery or at least heading into recovery.
Speaker 1: He of course, key things here are always going to
Speaker 1: be the macro headwinds that are facing this market, and
Speaker 1: it also faces crypto. But with what's happening in Japan,
Speaker 1: and now you add this in here, which is potentially
Speaker 1: again this whip saw one oh one coming out of
Speaker 1: the Trump administration. But Besst now says a deal with
Speaker 1: Iran could be announced as soon as tomorrow. We've heard
Speaker 1: this a lot of times, guys, I know that, and
Speaker 1: the market in most cases is somewhat numb to this
Speaker 1: right now. But if it were to occur, I'm just saying,
Speaker 1: if we start to see that kind of adjustment, it
Speaker 1: could be one of those things where Trump is finally
Speaker 1: just fatigued and wants to get out of this last
Speaker 1: point right here Trump, And this kind of makes me
Speaker 1: think that that could be a possibility, because Trump's trying
Speaker 1: to lay down deadlines that you know is not going
Speaker 1: to be met. He may do that just in the
Speaker 1: sense of having a slight win or trying to claim
Speaker 1: a slight win. But the point is is that all
Speaker 1: of this could start coming to a head. If it does.
Speaker 1: Timing is eerie here because you've got what's happening in Japan,
Speaker 1: You've got potentially the Fed now maybe looking at a
Speaker 1: reposition on policy coming out later this year, and you've
Speaker 1: got somewhat of a slowing economy. So there is a
Speaker 1: lot of headwinds that are all starting to cross together
Speaker 1: somewhat of a perfect storm here.
Speaker 2: Guys. We're going to keep a very close eye on this,
Speaker 2: so stay tuned.
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