THE FINANCE SHOW 🚨 TAKE 2

like I want to make sure my takes aren't bearish. Well, it's just a reality of the situation. And I do believe that there is a period of struggle that we will have to go through if we're gonna make any real changes, that there will be like a, I don't know if it's gonna be prolonged, I don't know if it's gonna be a few months, a year, a few years, but think about it, like there has to be pain. Anybody that's been through some really big changes in their life, you know how it goes. It's painful to go through tremendous amounts of change. You know, it's uncomfortable at minimum, it's very uncomfortable, maybe not painful so to speak, but it's definitely uncomfortable. That's why they call it growing pains, right? It's like as you get through situations, you become more powerful, you overcome certain things, you become stronger. So I do believe that if we are to overcome some of these adversities that we're facing as a society, I do think on the other side of it, we come out stronger, better, faster, you know, and I think an age of abundance is a reality. I truly do. Is it gonna be something that happens very quickly? Probably not. Overall, I'm an optimist, but I do, but I'm also a realist and I do understand that there are periods of abundance and there are periods of struggle and we go through those periods in our own personal life. And then you could scale that up to society as well, right? So whatever happens to you personally, you could scale that all the way through society because you could assume there are multiple people kind of going through what you're going through as well, you know? So it's like let's say you caught a break, there's probably a good group of people that just caught a break as well. If things are going well enough that people are catching breaks, you're not alone. If you're struggling, it's the same thing. You could probably assume that there are other people in a very similar position than you are struggling. So if we are to have a real big overhaul of our administration, if we are to move into automation, if robotics, not if, but when robotics really ramps up and catches up with AI, I do think there's gonna be some uncomfortability. That doesn't mean I'm a bear. Ultimately, you have to get through bearish points to get to the bull cycle, right? It's cyclical, bull cycle, bear cycle, bull cycle, bear cycle, bull cycle, bear cycle, and pretty much every single industry, these cycles exist. And before we get to the next bull market, if there's a bear market that we have to go through, so be it, some might argue that we already went through a small bear market, you know? Even though certain AI stocks have been all time high and looking at Nike down 85% from all time highs, you know? So it wasn't a full bull market all the way across to begin with. It was just certain sectors were just booming. Hence the reason they say the bubble will pop, right? It's like, it's just like over hype on one sector, but to the defense of the AI sector, AI can kind of be grouped into everything, you know? Like we spoke about this when there's an advancement in AI, it's an advancement across the board. Well, note even the Russell 2000 index just hit an all time high pretty recently this year. So now there has been a divergence the last month or two of the S&P 500 and the Russell 2000 index. So starting to see some stress on the Russell stocks, which are a lot more susceptible to interest rate increases because they have a lot more debt. They can't pay, right? They can't pay a lot more debt. They can't pay their debt and come refunds on the Russell 2000 companies versus the S&P 500 companies. But they probably won't be able to ever pay the debt. You know, a lot of these companies are never gonna pay their debt and they're gonna go under it. Look at it, even I'm pretty sure anthropic is like a trillion dollars in debt. A lot. They lost a lot of money. For real? Or trillion or something? They're like deep, deep, deep in the death. Maybe not a trillion. Oh, here, let's look at it. That's a lot of lambdas. At that level though, you just file for bankruptcy and forget about it. Ernie's. I mean, exactly. They're never gonna pay the debt, Jack. That's the thing. But there was money lent out and there was money raised. Okay, it's not a trillion dollars. It's more like a hundred and fifty billion dollars. But still, you know, that's just, I mean, that's a lot of debt. That's a lot of debt. Imagine being a hundred and fifty billion dollars in debt. She wrote, do you think they can revenue enough to cover the interest? I mean, I would assume so. I would assume so. I would assume so. Or they wouldn't be able to IPO for $1.5 trillion. Well, you can buy the IPO. There's a price model somewhere that shows them, you know, bouncing back eventually. Or at least, I mean, the fact that, the IPO and dilution event might be the way they pay back this debt. The IPO and dilution event. That could be one of the reasons, that could be one of the ways they do it. Well, you mean, I don't understand. Oh, Jack, you want to take, you're taking cash when you IPO. You're basically like selling your shares of the company. Oh, they have not IPOed yet. Okay, I thought. Yeah, they're IPOing this quarter. Okay, no, I understand that. I thought the IPO'd already, that's why I was confused. Oh, they're IPOing this quarter. So, yeah, I mean, there's definitely people that are bullish if they're about to buy this IPO for $1.5 trillion. I just don't see where the revenue for AI continues to come in because anybody that I ask about AI, they're not making money with AI. They're just, yeah, everybody's gonna. Everybody's gonna one day. They think they're nerfing it a bit. Well, I worked in writing it. And so much stuff, anything about it. Yeah, what I'm saying is that, everybody's gonna one day, you know, but until then, it's like you're working your job to pay for the AI and you're not making money for the AI. So when you lose your job to the AI, who's gonna pay the AI? Well, that's what I'm saying. It's like at a certain point, the this retail cost model that they're leading on, it's gonna have to change. They can't expect retail to be paying their bills forever. It's gonna have to move into industrial or institutional liquidity will need to flow into the AI sector. Meaning, you know, Walmart needs to be putting in a shitload of money because they're using cloth or whatever. It's just, it's, I don't know, it's a weird situation because you would assume that open source will just take over eventually. And a lot of these companies will become obsolete because what happens when you could compete with cloth and just open source that whole entire model? What's the point of using cloth at that point? What's the point of using Chad Gbt? What's the point of using Grock even if they can open source models that have the same capabilities? I mean, some of these open source models, they're even gonna be better than the models that are in these containers and being wrapped and sold to retail. They still need the computing power. That's where on chain is so key because you can do open source software with the power of the robustness of lots and lots of computing power all going to the same utility. That's the public protocol power. Like the vendor basically. The question here that I'm seeing is like, what's the best revenue opportunity set with AI? Like if you control a bunch of AI like these companies do, like what's the most lucrative thing they can do? All for like retail, for example, it would be like rearranging their systems to do inventory to manage stock up to like figure out all like they're receiving the shipping. Because right now everybody's running on the manual, right? It's like that administration people. So there's probably like a person or a group of people on each company trying to figure out right now how to create those new systems for a company for their needs to have. You subscribe to it, token. I don't know if that's the case Rose because Walmart has super sophisticated systems. However, like every company on the planet, they have to deal with liability. And that's really honestly a lot of the name of the game is like minimizing liability, relatively speaking and like keeping production flowing. And that's like why even like, okay, Google bought Gemini like pretty much all Fortune 500 S&P 500 companies are gonna have to buy any kind of new product or service because the whole operation has to basically be focused on administering the operations itself. It's just kind of a necessity to do. You. So it's been, I've seen it done before, like a transition between like one system with the next. And normally you, there will be a time where you're running both at the same time until you can like finally ween off the one that you've had previously to throw it away or to scrap it or to put it somewhere else. So that's what I would imagine would be the system. So we'd have two different systems. Maybe that's, it would be like one side the banking industry, whatever. And then crypto running at the same time until we're weened off the old system. Yeah, I think that's very realistic. Some kind of amalgamation of what you said, I think is kind of what's happening right now, basically behind the scenes. And it's just kind of being presented to us, you know, as we see it on the timeline and in the media, et cetera. Really good points, really good points. So where do we go from here guys? Or we're going to reset, we're going to move the goal post a little with this whole flash crash stuff. I still think this month looks pretty juicy, but we'll see. Well, but October's just starting. The best month for crypto. It's also the best month for track five. This is so likely the best month for track five. Track five clash, crash is also head October 2, pretty notorious. So we'll see, the witch history holds up more. I'm just, well, last year we definitely did get the October 10 crash. So I mean, but that wasn't really, that was a non election year. So that's the biggest difference in this year and last year is that we're going into an election year. And on average historically, October to December timeframe during a midterm year is bullish time for the markets. And it has been so far. That's for sure. So where do we top off then? Well, the Russell topped off. Let's see, roughly looks like August mid August, roughly right, right around the time of that three ring circus with Jackson Hole in Washington. Remember that one? Yeah, were there spending some time in Jackson's hole? Yep. Yep, Jackson's hole got penetrated. That to me looks like that. If you look at the Russell 2000 versus the S&P 500 divergence and the Russell 2000's top basically, it looks like it happened around then, at least interim top. I don't know, something to look at. Food for thought. I don't know. Yo, web, you do nothing. You say nothing this entire space. All you've done been doing is just fat fingering the mute button. Let's settle that. I didn't even have my phone in my hand. Hey, guys, guys. I was just saying that the stock market can be dragged out for a long time by the market makers. They can keep it pumped up for a while if they want to. So for political reasons, they wanted up there. They'll keep it up there. But at some point, it'll behoove them to crash it back down and you know how that goes. So expect. Like it's really overpriced. So you know, it's due. It's just a matter of like when they decide to like let the air out of the balloon. Is that the stock market that you believe is overpriced? Yeah, yeah. Ripville's cheap stock market is expensive. Gold is kind of expensive, but might maintain it because of unrest. Gold will look pretty expensive to you. I think only, I think the stock market only looks that way from the outside. I mean, look at Nike. You know, I'm telling you guys, there's a very real possibility that that was just the beginning for the stock market. And actually it has a lot more to go. The multiples are all off for that to be a top. The earnings to stock price ratio are all off. They're way too low. And I'm not saying that the stock market's going to go higher. But when people say that the stock market is too high and it's ready for a crash, that is not what most analysts think. Well, it's like a lot of the prices are just way too. So it's like this concept of if I put a dollar in, how long does it take for that dollar to get doubled? So if the PE ratio is at one, then it takes one year. But if the PE ratio is at 50 or 70, then it's 50 or 70 years. Who's got time to wait around for that to double? Oh, lots of people with big capital. People who are basically propping up the entire stock market. I mean, you have to realize crypto is like, crypto is like a D-gen play to them. Like even Bitcoin, they don't even look past Bitcoin. So I always tell people when you want some risk, it's like you're already in crypto. So if you're buying Bitcoin and like dogeonal dogs, you are like, you are,