Bitcoin Just Sniffed Out the Biggest Print Since 2008

0:00Four things just happened in the last 72

0:02hours that have only lined up together

0:03one other time in modern financial

0:06history. And the last time that they

0:07did, the Federal Reserve printed four

0:09and a half trillion dollars. The man who

0:11ran the Treasury in 2008 just went on

0:13Bloomberg and told the country to

0:15prepare a break the glass plan. The US

0:17Treasury just had to step in and buy

0:19back 15 billion dollars of its own debt

0:22in a single morning, the second time in

0:245 weeks. And bond holders showed up

0:26trying to dump nearly three times that

0:28much. The new Fed chair nominee, Kevin

0:30Warsh, just walked into a Senate

0:31confirmation hearing and openly called

0:33for regime change at the central bank.

0:36And the president of the United States

0:37publicly said that he would be

0:38disappointed if Warsh didn't cut rates

0:41immediately after taking the role. And

0:43Bitcoin, right in the middle of all of

0:45it, has ripped 22% off of its February

0:47low and is sitting at $78,000 as I'm

0:49recording this. And it has done it while

0:51bears are paying 12% interest just to

0:54bet against it. So, a lot of you asked

0:56for this breakdown in the comments of

0:57the last video, so here it is. But,

0:59we're not stopping at the headlines. I'm

1:01going to show you the exact sequence

1:02that locks in the biggest monetary

1:04expansion since 2008. I'm going to show

1:06you why Bitcoin is already sniffing out

1:08while the rest of the market is still

1:10debating whether it's happening. And if

1:12you watch till the end of the video, I'm

1:13going to show you how to position in

1:14front of it before the rest of Wall

1:16Street catches up. Let's get into it.

1:17So, here's the chain, the entire spine

1:19of this video. I want you to memorize it

1:21because I'm going to come back to it

1:22four times. Oil, CPI, real rates, the

1:25Fed, Bitcoin. That's it. That's the

1:28whole sequence. Every link in that chain

1:30is already moving. And three of the five

1:32links are already locked in. The fourth

1:33link, which is the Fed, just had its

1:35roadblock removed this week. And the

1:37fifth link, Bitcoin, is the only asset

1:39on Earth that moves before the other

1:41four finish playing out. Let me walk you

1:43through each one. So, we'll start with

1:45oil. Crude oil ran above $100 a barrel

1:47during the Iran conflict. It's pulled

1:49back to about $90 now that Trump has

1:51extended the ceasefire indefinitely.

1:53But, here's the part that doesn't get

1:54reported. The damage is already done.

1:57Gasoline prices lead CPI by about 6

2:00months. You can see right here, when

2:01crude oil runs, then wholesale gasoline

2:04prices skyrocket, and then retail

2:06gasoline prices skyrocket. So, we've

2:08already seen prices at the pump begin

2:09climbing over the last week. That is the

2:11leading indicator. The inflation you're

2:13going to feel in July, August, and

2:15September is already locked in right

2:17now, cuz it's not just about gasoline.

2:18It's the fact that oil is an input in

2:21just about every product in the modern

2:23economy. From energy to trucking, to

2:25manufacturing, to prices you see at the

2:27grocery store. The last time that crude

2:29oil spiked this hard and stayed there

2:31was in 1979, when core CPI inflation hit

2:3413 and 1/2% and the Fed chair at the

2:37time, Paul Volcker, took rates to 20% in

2:39response. The stock market lost 10 years

2:42worth of progress. I'm not saying that

2:44we repeat that playbook, but I'm saying

2:45that the physics are the same. You

2:47cannot move crude oil 50% higher in a

2:49calendar year and have it not ripple

2:51through the rest of the economy. So,

2:53link one, oil is locked in. Link two,

2:56CPI is already underway. Now, watch what

2:59happens at link three. So,

3:01year-over-year CPI inflation is about to

3:03cross above the yield on the 3-month

3:05Treasury bill. This is the moment where

3:07short-term real rates turn negative.

3:09Now, I want you to understand why this

3:10matters because almost nobody on Finance

3:13X or YouTube is talking about it in

3:15these terms. So, think about it this

3:16way. When cash yields are above

3:18inflation, you can sit in T-bills and

3:21preserve your purchasing power. You

3:22don't need to take a lot of risk. You

3:24don't need to buy anything scarce. You

3:25just park your money in there and it

3:27doesn't rot. That's the entire reason

3:29that the Fed was able to hold rates high

3:31for 2 years and watch people happily sit

3:33in money market funds. The math worked.

3:36But, when inflation crosses above the

3:38yield on T-bills, the math inverts.

3:41Every day that you sit in cash, you lose

3:43ground. The cash stops functioning as a

3:45store of value in real terms. So,

3:47capital has to go somewhere. And this is

3:49the exact regime that has historically

3:51produced the most violent Bitcoin

3:53rallies in its entire history. I'll get

3:55into the actual numbers in a minute cuz

3:56it's going to surprise a lot of you. But

3:58that brings us to link four, which is

4:00the Fed. And this is where the last 72

4:02hours become unbelievable. Kevin Warsh,

4:05the nominee to replace Powell as Fed

4:07chair, was on the Federal Reserve Board

4:09of Governors from 2006 to 2011. He was

4:12in the room where the first QE program

4:14launched in 2008. Now, QE is

4:16quantitative easing, otherwise known as

4:18money printing for those who might not

4:19be aware. He was in the room when QE two

4:22launched in 2010, and he voted with the

4:24consensus on both. But then he left and

4:26spent the next 15 years becoming one of

4:28the loudest critics about quantitative

4:30easing in American life. He said,

4:32"Quote, QE is reverse Robin Hood. It's

4:35policy that steals from the poor to give

4:37to the rich." That's the guy that Trump

4:38just nominated, and he walked into the

4:40Senate confirmation hearing this week

4:42and said, I quote, "We need to find a

4:44way to take the balance sheet and make

4:45it smaller." Well, by all accounts, this

4:47guy seems like a hawk, someone who's

4:49going to rein in the money printing and

4:51bring some accountability back to

4:52Washington. But that's all talk. Let's

4:55take a look at the reality. Trump, on

4:57the same day, publicly said that he

4:59would be disappointed if Warsh didn't

5:01cut rates immediately upon taking the

5:03role. Warsh himself opened his hearing

5:05by attacking Powell, saying the Fed

5:07missed its mark and that current

5:08inflation is a legacy of past policy

5:10errors and that keeping rates too high

5:12now is the new mistake. But read between

5:15the lines here. This is the setup for

5:17money printing dressed as correcting a

5:19previous Fed's mistake. That's how you

5:21print without calling it printing. And

5:23here's the part that nobody is

5:24connecting. Think about it this way.

5:26Warsh also said something on CNBC that

5:28sounded like a throwaway line, but is

5:30actually the entire playbook. He said

5:32that AI is going to be strongly

5:33deflationary and that we're in the early

5:35innings of a structural decline in

5:37prices. Take a listen.

5:38>> What we call AI in a couple years we'll

5:41just call business.

5:43And AI is going to make almost

5:44everything cost less, and the US can be

5:47a big winner, and and it's a hugely

5:49exciting moment. If I were to step back

5:51for a minute, if I were the president,

5:53what I'd be worried about is a central

5:55bank that doesn't see any of that. A

5:57central bank that is stuck with models

5:59from 1978,

6:01governance from a prior period, and

6:03don't recognize we could be at the front

6:05end of a productivity boom. And if I

6:08were the president, I'd be worried that

6:09they might not see it, and they might

6:11think economic growth is somehow going

6:13to be inflationary. And they we were

6:15probably in the early innings of a

6:17structural decline in prices, can see it

6:20on the front lines of real businesses,

6:22and I think if you look over

6:24the period of the next year or two, it's

6:25a pretty special moment.

6:26>> So, translation, I'm going to cut rates,

6:29and when inflation keeps running because

6:31crude oil and the real economy doesn't

6:33care about software productivity, I'm

6:35going to tell you that inflation is

6:36transitory because AI will absorb it

6:38later. This is the convenient alibi.

6:40This is the permission slip to cut rates

6:42and print money despite rising

6:44inflation. So, if any of you remember

6:46the word transitory, it's about to come

6:48back in a very big way. Now, [snorts]

6:50some of you are thinking at this point,

6:51okay Joe, nice theory, but how do I

6:53actually know the Fed is being forced

6:55into this? Well, fair question. Let me

6:57show you the receipts. So, the US

6:59Treasury just did something on April

7:0116th that should have been front page

7:03news everywhere, and instead it got

7:05buried. The Treasury had to go and buy

7:07back $15 billion of its own debt in a

7:10single operation. But, US Treasury

7:12holders responded by offering $40

7:14billion, which is three times over

7:16subscribed. Some of the bonds that the

7:18Treasury accepted were well below face

7:20value, meaning that holders were willing

7:21to take a huge loss just to get out. And

7:24the other $25 billion of wanted to sell

7:26supply sat there with no buyer. This was

7:29the second $15 billion operation just

7:31five weeks. These buybacks were

7:33announced three years ago as technical

7:36plummet, starting at just $2 billion per

7:38week. But, then they scaled to $4

7:40billion per week by 2025, and now just a

7:42year later, they're running at $15

7:44billion

7:45every week. That's a 7 and 1/2 X

7:48increase in just 18 months. Now, these

7:50were programs originally labeled as

7:52technical plumbing, but clearly programs

7:55don't scale like that if they're meant

7:56to be temporary. This means something

7:59has broken on the demand side of the

8:01Treasury market. And here is what Hank

8:03Paulson, the 74th Treasury Secretary of

8:05the United States, went on Bloomberg and

8:07said the same afternoon that the buyback

8:09cleared. He said, and I quote, "We need

8:11an emergency break the glass plan, which

8:13is targeted and short-term on the shelf,

8:15so it's ready to go when we hit the

8:17wall. When we hit it, it will be

8:19vicious." End quote. Take a look at what

8:21he said.

8:22>> This crisis is different, right? If when

8:25you hit the wall and you're trying to

8:27issue Treasuries

8:29and the Fed is only buyer and the prices

8:32of the Treasuries are going down, and

8:33interest rates are up, that's a

8:35dangerous thing.

8:36And so I what the thing I am talking

8:39about now is

8:41we know people say, "When are you going

8:43to hit the wall?" I obviously don't

8:45know. It's impossible to know. But the

8:48law of economic gravity, you're you're

8:50not going to know that. So, and when we

8:53hit it, it will be vicious. So, we have

8:55to prepare for that eventuality. And I

8:57think we need an emergency break the

8:59glass plan, which is targeted and

9:03short-term on the shelf, so it it's

9:06ready to go when when we hit the wall.

9:11>> Now, that's not a hedge fund manager

9:12hawking his book. That's the man who

9:14personally wrote the $700 billion TARP

9:17bailout in 2008. He's telling you that

9:20the US Treasury market is structurally

9:22broken, that the buyers aren't there

9:24anymore, and that when it unwinds, it'll

9:26unwind violently. And Washington needs a

9:28playbook ready for the moment that it

9:30happens.

9:31Now, here's the part that turns this

9:33from a policy debate into a math

9:35problem. The US Treasury has to roll

9:37roughly 7 to 8 trillion dollars of

9:39maturing debt every single year on top

9:41of the 2 trillion dollars in new

9:42issuance to cover the deficit. So, every

9:45basis point that the 10-year US Treasury

9:47yield moves up costs the federal

9:49government tens of billions of dollars

9:52in compounding interest expense over

9:53time. In fact, interest payments already

9:56exceed 1 trillion dollars a year, which

9:57is larger than the defense budget. And

10:00every dollar of new debt that gets

10:01issued, about 53 cents of it goes to

10:04paying off the interest of existing

10:06debt. So, the Fed cutting rates is not a

10:08choice or a policy preference. It is a

10:10debt service arithmetic. If yields don't

10:13come down, the interest line eats the

10:15budget alive. And that is why Kevin

10:17Warsh was selected. That's why Trump is

10:19publicly demanding cuts on day one

10:22because the math leaves no other option.

10:24And I promise all of this is going to

10:26tie back into Bitcoin. Why are the

10:27buyers not there anymore? Well, two

10:29reasons. Number one, foreign central

10:31banks have been net sellers of

10:32Treasuries for three straight years

10:34while buying a record amount of gold.

10:36China has cut its Treasury holdings from

10:371.3 trillion to under 800 billion, and

10:40Japan has been a net seller for 2 years

10:42running. Foreign official ownership of

10:44the Treasury market has drifted from 34%

10:47a decade ago to around 24% today. When

10:50the US froze 300 billion dollars of

10:51Russian Central Bank reserves in 2022,

10:54every other country on Earth got the

10:56memo. Holding US Treasuries means

10:58holding a checking account with

11:00political preconditions, and all of them

11:02are quietly rotating out. But, who picks

11:05up the slack? Hedge funds in the Cayman

11:07Islands running the basis trade with 50

11:09to 1 leverage financed overnight in the

11:11repo market. The Fed's own economist

11:13just published a paper saying that those

11:15funds are holding 1.85 trillion dollars

11:17of Treasuries. That the number is a

11:19trillion dollars larger than it was in

11:212022, and that their positions likely

11:23exceed the levels from March 2020 when

11:25this exact trade broke the Treasury

11:27market and forced the Fed to step in

11:29with emergency buying. Link the full

11:32chain together. Oil is pushing CPI

11:34higher. CPI pushes real rates negative.

11:37Real rates going negative crushes demand

11:38for US debt at the same time foreign

11:40buyers are leaving, and that leaves one

11:42buyer of last resort, the Fed. And the

11:44new Fed chair was specifically chosen

11:46because he's going to cut and print when

11:48he's told to. That is the pipeline. Now,

11:51the forward case, what does this

11:53actually mean for Bitcoin? The strongest

11:55macro regime in its entire history is

11:57this specific combination of macro

11:59factors that we're facing right now. We

12:01have CPI running above three-month

12:03T-bill yields while the Fed is on hold

12:05or easing. And as you can see here, that

12:07regime has produced annualized Bitcoin

12:09returns of over 200% every time it's

12:12happened. And we're just weeks away from

12:14entering that exact window. Not just

12:16real rates going negative, but a brand

12:17new Fed chair who is forced to print.

12:19This is not a small macro detail. It may

12:22be the most important setup Bitcoin can

12:24have. And here is what blows my mind,

12:27Bitcoin is already front-running it.

12:28Bitcoin bottomed at $60,000 on February

12:3128th when US strikes on Iran began and

12:33markets cratered. As I'm recording this,

12:36it's trading around $78,000. That's a

12:3822% rally in just 53 days through the

12:41largest oil supply disruption in

12:43history. With the Strait of Hormuz that

12:45runs over 1/5 of the entire world's oil

12:48supply shutting down. And despite every

12:50piece of fud that the establishment

12:52media machine could spin up about

12:54Bitcoin. This is what many are calling

12:56the most hated rally in Bitcoin's

12:58history. Take a look at some of the

13:00data, Bitcoin perpetual futures have

13:03posted a negative 30-day funding rate

13:05for 46 consecutive days, meaning that

13:07the shorts really want to push this

13:09thing down. This is the longest streak

13:11of short pressure since the aftermath of

13:13FTX in November 2022. And bears are

13:16paying anywhere from 6 to 12% annualized

13:18to short Bitcoin. You also have put

13:20option premiums which are running 10 to

13:2220% above calls, meaning that shorts are

13:25much more dominant than longs. And

13:26they're paying a premium to short

13:28Bitcoin. The entire speculative complex

13:30is positioned against this rally. Yet,

13:33Bitcoin keeps grinding higher. Well,

13:35why? Because Bitcoin is the last

13:37functioning early warning system in

13:38global markets. It's 24/7, globally

13:41liquid, borderless, 1.5 trillion dollars

13:43in market cap, and absolutely scarce.

13:46That makes it the most price sensitive

13:48liquidity sponge on Earth. So, when the

13:49printers are warming up, Bitcoin knows

13:51first. When real rates are about to turn

13:53negative, Bitcoin moves before anyone on

13:56CNBC has connected the dots. So, you

13:59want to know how reliably Bitcoin plays

14:00this role? Well, take a look at this

14:02chart right here. Seven geopolitical

14:04crises since 2020. You have US and Iran

14:06in 2020, COVID, Russia-Ukraine, US

14:09banking crises, yen carry trade unwind,

14:11and Trump's liberation day, and of

14:12course, the Iran conflict in February.

14:15The 60-day returns after each event. The

14:17S&P 500 was positive six of seven times,

14:20gold was positive five of seven times,

14:22but Bitcoin was positive seven out of

14:24seven times. Every single time. That's

14:27not a coincidence. That is a structural

14:28feature of an asset that's designed for

14:30exactly this kind of world. And some of

14:32you are thinking, "Yeah, but Bitcoin is

14:34correlated to tech, and tech is

14:36volatile, and I don't trust this rally."

14:38Well, I hear you. But, here's the thing.

14:40Bitcoin lost its correlation to global

14:42money supply last year because it was

14:44trading alongside software stocks.

14:47Well, that correlation has now broken.

14:49Bitcoin is rediscovering its

14:50relationship with global liquidity at

14:52the exact moment that global liquidity

14:54is about to expand faster than at any

14:56point since 2008. The setup is

14:58reloading. Now, remember earlier when I

15:00told you to hold on to the word

15:01transitory? Well, here's the payoff.

15:04Powell's AI deflation argument is the

15:06intellectual justification for printing

15:08into rising inflation. He's going to cut

15:10rates, inflation is going to run hot,

15:12and he's going to tell you that AI will

15:13solve it. But, he will be wrong because

15:16central banks can print money, but they

15:18can't print copper. They can't print

15:19electricity or diesel, and they

15:22certainly can't print stable purchasing

15:24power. AI creates deflation in software,

15:26in knowledge work, in labor. It creates

15:28inflation in power, in chips, in data

15:31centers, in the physical infrastructure

15:33that the economy needs to support it.

15:35So, you'll see creative destruction in

15:37labor, but scarcity inflation in

15:39everything physical. The old money

15:41printing playbook was not built for that

15:43collision of forces, and Bitcoin is the

15:45only asset in the world that sits

15:47perfectly in the middle of it. Scarce,

15:49digital, apolitical, and immune to both

15:51sides of the squeeze. Now, I've got two

15:53more data points I need to give you

15:55before we close, because they change how

15:56you should think about what's happening.

15:59Number one, every single time in

16:00Bitcoin's history that it's recovered

16:0230% from a cycle low, it has never

16:04revisited that low. Six for six across

16:0713 years. The year-to-date low was about

16:09$60,000, meaning the 30% confirmation

16:13level sits at $79,694,

16:16and we are sitting at the doorstep of

16:18that level right now. If Bitcoin can

16:20close above $79,700

16:22and hold, the historical probability of

16:24seeing $61,000 again is zero. And number

16:27two, Bitcoin's 200-week moving average

16:30has compounded at 30 to 35% annually for

16:33over a decade. The lowest it has ever

16:35drifted was 29%, so it's never been

16:37negative. This is not a cyclical asset

16:40anymore. This is a structural monetary

16:42asset in the middle of a regime change

16:44of the world's most powerful central

16:45bank. And then there's the part of the

16:47story that nobody is talking about. The

16:49US government has told you what Bitcoin

16:51is. Admiral Samuel Paparo, a four-star

16:54Navy admiral and commander of INDOPACOM,

16:57the largest geographic combatant command

16:59in the US military, testified before the

17:00Senate Armed Services Committee this

17:02week and said, quote, "Bitcoin is a

17:04valuable computer science tool as power

17:06projection." Take a listen.

17:08>> Uh to another subject, our competition

17:10with China isn't just about military

17:12strength, it also includes monetary

17:13strength as well. You You last year the

17:16Chinese Communist Party's main monetary

17:18think tank published research

17:20on Bitcoin as a

17:22strategic asset. You know, this came

17:24after President Trump moved to establish

17:26a strategic Bitcoin reserve. Admiral,

17:29how does leadership in Bitcoin impact

17:31leverage resilience deterrence for

17:33Indo-Pacom against China? And do you

17:35think that a strategic Bitcoin reserve

17:38helps America compete against China?

17:41>> Senator, our

17:43you know, our research into Bitcoin is

17:46as a computer science tool. It's the

17:48combination of cryptography, a

17:50blockchain, and a proof of work. And

17:53Bitcoin shows incredible potential as a

17:56as a computer science tool that through

17:59the proof of work protocols is a

18:02actually imposes more cost than just the

18:04algorithmic securing of networks and our

18:07ability to operate. And

18:10Bitcoin is a reality. It is a valuable

18:13computer science tool as a

18:15power projection,

18:17and outside of the economic formulation

18:20of it, it has got really important

18:22computer science applications for

18:24cybersecurity.

18:26>> Thank you. What what recommendations do

18:27you have for us here in Congress on how

18:29to

18:30how the US can lead on Bitcoin

18:32competition?

18:35>> I you know, I I have to go deeper on

18:37that with you for the record. And I I

18:39can go I can go deeper on that case, but

18:42it Bitcoin is a reality. It is a

18:46peer-to-peer

18:48zero trust transfer of value. Anything

18:51that supports the all instruments of

18:54national power for the United States of

18:55America is to the good.

18:58>> Let that sink in. The US military is not

19:00only running a Bitcoin node, but they

19:01view it as a geopolitically important

19:04asset. Scott Bessent, the Treasury

19:06Secretary, in the same week told

19:07Congress that US leadership in Bitcoin

19:10secures the primacy of the dollar as the

19:12world reserve currency. Let me say that

19:13one more time.

19:14US leadership in Bitcoin secures the

19:17primacy of the dollar as the world

19:19reserve currency. He explicitly framed

19:22Bitcoin as a tool of American financial

19:24dominance. This is the top of the US

19:26national security apparatus and the

19:28Treasury Department publicly

19:30acknowledging that Bitcoin is a

19:31strategic asset in the geopolitical

19:33competition with China, with Russia, and

19:35with every adversary that has been

19:36rotating out of Treasuries for 3 years.

19:39So, let me tie all of this together and

19:41bring this home for you. Oil to CPI to

19:44real rates to the Fed to Bitcoin. The

19:46chain is already four links deep and the

19:48fifth link is moving in front of you in

19:50real time. The man who wrote the 2008

19:52playbook says the wall is falling. And

19:55the next Fed chair was selected

19:56specifically to print. The current

19:58Treasury Secretary is telling you that

20:00Bitcoin makes the dollar stronger, the

20:02US military is running a Bitcoin node,

20:04and seven out of seven crises since 2020

20:06Bitcoin has been positive 60 days later.

20:08Every 30% recovery in Bitcoin's history

20:11has never revisited the low and the

20:13200-week moving average has never gone

20:15negative. And we are about to enter the

20:17most bullish macro regime that Bitcoin

20:19has ever traded in. The big print isn't

20:21coming. The big print is already being

20:23scheduled. It doesn't need an

20:25announcement, it just needs a trigger

20:26and that trigger is going to be a failed

20:28Treasury auction, a basis trade unwind,

20:30or a repo market seizure.

20:32Paulson just told you. And when the Fed

20:34is forced off of the sidelines, they're

20:36not going to print $700 billion like in

20:382008. They're going to print many

20:40multiples of that. If you've been

20:41watching for a while and this finally

20:43made the picture click, do me a favor

20:45and drop the word print in the comments.

20:46I'm tracking which topics to go deeper

20:48on next and that'll be my signal. In the

20:50last video, I walked through how Michael

20:51Saylor just beat BlackRock at the $62

20:53billion Bitcoin game by front running

20:55this exact setup. So, if you haven't

20:57watched that one yet, that's a

20:59prerequisite for what we just covered.

21:00Go watch that one after this and I'll

21:02see you over there. Also, hit the

21:03subscribe button, the alert bell, and of

21:05course hit join to become a channel

21:06member. The market is moving now. I'll

21:08see you in the next one.