Greed Setting In

Salaamu alaikum everyone. I hope you are doing well. Today is July 22nd and Bitcoin is at 67,500. Tesla is at 251. Tesla reports earnings tomorrow. And what a time to be alive, what a time to be an investor. This is really exciting. We had quite the day today with Tesla getting a pop coin and crypto is showing some early signs of strength. And as I mentioned on Friday, I do think that, you know, now is the time where I start to expect crypto to rebound in a big way. Let's look at some of the main factors impacting the markets today and what we make of them. As always, this is not financial advice, so be sure to do your own due diligence and leave a like if you enjoy these lives, if you're benefiting from them. Thank you so much for everyone leaving the like and getting our lives consistently to 100 likes. I really appreciate that. So we have a pretty busy week upcoming. We have test learnings, as I mentioned tomorrow, U.S. good orders. That comes out Wednesday, I'm sorry, Thursday, a U.S. weekly jobs claims comes out Thursday. And we have the Bitcoin conference this week as well. And we mentioned last week that Trump, there was rumors from some actually pretty credible sources mentioning that Trump may announce his plan to add Bitcoin as a reserve asset in the United States, which would be huge, even bigger than if it actually happened. It would be an event on par if not bigger than Bitcoin ETFs on par with any sort of bullish news event that we've seen for Bitcoin that has taken it to close to $70,000 in the span of a decade starting from basically being worth almost nothing. And then the big number this week, PCE comes out on Friday. This is big because the market is right now in greed mode. And it is in greed mode because it anticipates liquidity to be rising that the central banks of the world are going to start easing and that the possibility for a rate cut in September is basically being priced in as a virtual certainty. So if we get confirmation from the inflation numbers, then the market will react positively. If we get inflation numbers that are colder than expected, cooler than expected, then this will be very bullish for markets. On the other hand, if we get a surprise to the upside in inflation numbers, then the market may react quite violently to the downside to that. But I happen to think that we will get, as I've been calling the last couple of inflation numbers, I happen to think that inflation is cooling. Certainly, when you look at economic activity and the trend of GDP in the United States, you can see that the logical conclusion is that inflation is cooling. So we'll see on Friday. Now hedge funds in the midst of all of this have been stacking gold, which I mean hedge funds, you would think that they are the best and brightest. They haven't really been a good indicator for what you should be in recently. In fact, they've often been a counter indicator, but for now they are stacking gold. Gold is pushing higher, but if you compare it to other reserve assets, I wonder what I could be talking or referring to. But if you compare it to other assets, there have always been much better performing assets. Even if you take into account the correlation, so obviously gold, the appeal of it is, yes, perhaps appreciation and price, but also the lack of correlation with other asset classes, there are other assets that have performed this function better than gold as of late. If you look at central banks, they have been in a recent survey. They've mentioned that they were looking to increase the reserve of gold as well. Now central banks tend to be very conservative in what they do. If you look at the percentage of reserves that are gold for central banks, that has been falling since the beginning of the millennia. You can see that we reached a low of less than 10%, but we have been picking up. We have seen a pickup in the percentage of asset reserves that are gold for central banks. This may have something to do, or maybe indicative with a lack of trust in currencies, which are the other major reserve for central banks and especially the US dollar. As I mentioned, I do think this is the wrong reserve asset. Eventually, central banks will start holding Bitcoin as a reserve asset. It's just a matter of how long it takes them to get on board. But if you look at the the coin had an annualized return of 55%, you can see compared to S&P 500, now it's that gold and silver that Bitcoin has outperformed by a long stretch, the other competing assets. The other piece of big news that is impacting the markets is the US presidential race. Biden obviously dropped out and Kamala Harris is his replacement. Currently, the odds, I mean, they differ depending on who you ask, but Trump is sitting at 47% and Harris at 45%. I actually think the odds may be more in favor of Trump, but it's very hard to gauge. Kamala Harris is a person. I mean, Trump has his obvious flaws in character. Kamala Harris, on the other hand, is someone who I've never heard put together a profound original thought and just a completely unremarkable human being for me. So I'd be surprised if she has as high a chance as people are assigning to her, but we'll see. And the market is still trying to figure out which sectors will benefit from who. Obviously each candidate is playing through their bases and promising this, that, and the other, but what they actually deliver on is anyone's guess. And really, I don't think that their policies, perhaps anticipation of their policies will move markets a lot, but their actual policies will pale in comparison in terms of its impact with the number one determinant for markets in the near term, which is liquidity and is the state of liquidity in the United States and from that globally, because you have to remember a lot of other countries, other central banks, may be waiting for the U.S. to start an easing process because they don't want to ease before the U.S. does because it may tank their currency. If they ease before the U.S. does, then in relation to the dollar, their currency may fall dramatically. So a lot of central banks, you have to believe, are waiting for the U.S. to start with their ease. And so the U.S. easing will ease monetary policies globally, even more than they have been. Now, something the market seems to be pretty certain about is the capital rotation trade. So you can see that small caps and equities that really haven't been performing well since the beginning of the year, comparatively speaking, have now bounced and gained ground compared to the S&P 500 and the big shots in that index who have been basically making up the majority of the gains that we saw in that index. And so now I think is an opportunity in time to find the best small caps to invest in. And that's what we've been doing, building up our small cap portfolio. Added a second pick last week, we'll probably add a third pick soon in child law. And the small cap, RSI. So if you look at the chart on the bottom of this graph, it has broken 80. For the first time in six years, it hasn't broken 80. Last time it broke 80 was actually 2017. And before that, you'd have to go all the way back to 2003 and before that 2001, where the RSI broke 80. Now, in each one of these cases where the RSI broke 80, there were still years of upside ahead of it. And so it's not necessarily a cell signal when the RSI breaks a certain number. Often it's just an indicator of the strength of the move and the conviction that the market has with the move. And so I do think that small cap still have room to run in child law. If you'd like to follow our portfolios, do become a member if you aren't a member already. And with that, let's go to questions. Underground text says Trump will easily win. Hey, that's what I think. I think he's going to easily win. Like I said, Kamala Harris, I've never really heard her say anything noteworthy. Or I don't know anything impressive that she's done. That being said, I'm not an expert on her life story. It will probably continue to come out in the coming weeks and months. But I haven't really heard or anything that would make her an affable figure or politically attractive for me or I have to believe many other people in the United States. Rachad says, so I'm all market hates uncertainty. I second that. Yeah, I think that the more certainty we have around the rate cuts, the better for the market. Now, that being said, after we do get a rate cut, we may have a correction as we have had many times in the past, something to watch out for. That's why I always say guys, take profits. You don't know what's around the corner. Obviously, you know, absent any exogenous events. I think that the market has more room to go. That being said, you don't know what happens geopolitically. Other events could happen. So take some profits. How much profits to take? Well, I would say take enough so that you're both happy if it continues to run up in price. But you're also happy that you took profits if a dramatic pullback occurs. Kamala Harris is from India. How are miners impacted by rate cuts? By the way, I think miners may be approaching that stretch where they start shining again. Not that they haven't been shining. You look at Bittier, for example, had a really strong day today, up more than 6%. Irish energy, not that much, up one and a half percent. Clean Spark, up less than 1%. So, you know, some of if you look at Moss and it was down more than 5%. So, I think the higher quality miners may do really well in this upcoming period because a lot of people are going to look at Bitcoin and they're going to say, oh, hey, it's already above 60,000. Now it's going to be above 70,000. Even if it goes up to 100,000 by the end of the year, as many people are predicting, you know, how much meat is left on that bone. I do think that Bitcoin is going to continue going up, but I want more return than what just buying Bitcoin can get me. And that's what's going to lead them to Bitcoin miners. And so, I think there may be a strong influx of capital into Bitcoin miners if the FOMO around Bitcoin intensifies. Zuhair says, Salaam Alaykum, everyone. Hope all as well, inshaAllah. Salaam Zuhair, nice to see you. Khaled says, Salaam Alaykum, what is the outlook for Dogecoin versus Bitcoin and Salaam? Well, actually, something I wanted to show you guys was last week we saw a lot of whales jumping into Dogecoin. And this preceded coins jump. So if you look at, you know, recent history, even though the headlines are all for bit, but Dogecoin has performed quite well as well. And so I think, you know, if you look at the last month, Bitcoin is up, you know, 5%, Dogecoin is up 10%. I think that, you know, Dogecoin has a shot at out considering its smaller market cap. And I keep coming back to this fact, which is that Dogecoin is a fork of Bitcoin. It's the same code. The only difference between Dogecoin and Bitcoin is the fact that there's a small but decreasing inflation rate for Dogecoin. And so I think a major integration with a major retailer for Dogecoin could really, I mean, specifically here, if there's any sort of meaningful integration with one of Elon Musk's companies specifically here, X, that could really propel its price higher. So we'll see. And Solana, Solana, I think it still has some room to run. I wouldn't be surprised if it doubles from where it is by the end of this bull run. And maybe even more than that. So we hold, we hold all three though in our PIF crypto portfolio, Bitcoin, Dogecoin, and Solana. So I'm gonna come again. Always great to attend your lives. Always great to see you, Abdullah. Thank you for joining us. Why does a potential cipher buyout make the price go up? And is that something we should wait for an iron? Well, I think, obviously, it depends on how much they're pricing a company. But if companies trading at X, and it's offered a price of 2X, well, then investors are going to adjust their price for that company. They're going to say, Oh, well, actually, this company is worth more than what it's trading on the public market. So so it does depend on what's being offered for the target of the buyer. And the price that's being offered. Typically, what happens when a smaller company is bought out by a bigger company is that the smaller company goes up in price. That's typically what you see in stock behavior. Now, I think a lot of people are anticipating in this, perhaps, part of the appreciation in the price of iris energy and other quality miners is that part of the reason for their appreciation is anticipation of a buyout for the purposes of using their power and land for data centers or something else related to, you know, high performance compute. Iris Energy, obviously, has really rich access to power and land, which are needed for high performance compute and data centers. So I think a lot of investors are giving it some of the benefit of the possibility of a buyout. Would you be interested in creating a poll in PIF Discord about stocks that PIF members are interested in knowing more about and the ones with highest votes you make a video about reviewing the company? Yeah, that's a good idea. So we having a poll is a good idea. We do have like a room member picks, you know, this Abdullah where members can talk about stocks that are cryptos that they're excited about and have discussions there. And I'm always keeping an eye on that. What about Litecoin? People who mine, Dogecoin, also mine Litecoin? Yeah, I think Litecoin is also a decent pick, to be honest. You know, some people like to say if Bitcoin is digital gold, Litecoin is digital silver, but I don't think that the number of catalysts for Litecoin, at least I can't see them as numerous as Dogecoin. And so that's why I'm more in Dogecoin. I just feel like Dogecoin has better marketing than Litecoin is than Litecoin does, a better brand, so to speak. Have you spoken about why we chose new stock for emerging markets portfolio? Yeah, we, well, so the emerging growth portfolio, the one that's focused on small caps, nano caps, micro caps. Yeah, I mean, I think that, as I mentioned, this is a good time to be focused on these smaller cap companies because of the rotation that we're seeing into smaller cap companies because of the anticipated interest rate cut and how that affects smaller cap companies more favorably than larger cap companies. Thanks for answering my questions and sorry about my son's silly YouTube screen name. Who's your son? Oh, okay, your son wrote that, okay, Titan multiverse and now, okay, those probably, you know, one of the best sources of ideas for investing are your kids, because they're always on the sort of bleeding edge of what's new, what's hip, what's, you know, trending upwards. So pay attention to your, to your kids and what they're interested in, if you're investing. Salaam, McCann, please share your outlook on PLL and CLSK when someone is looking for long-term investment plans. So CLSK is no longer in our portfolio. Piedmont lithium is part of our portfolio. I do believe lithium prices are going to recover. I don't know when I can't time it. There are some good indications in Charlotte that, you know, things are moving towards recovery, but we really haven't seen it in the price of lithium yet. That being said, even regardless of when the price of lithium actually recovers, I do think that a lot of these lithium miners are undervalued on just, if you look at their current assets and the contracts that they have in place for providing lithium, I believe Piedmont is one of those undervalued companies. So that's why we hold it. For CLSK, it's no longer in our portfolio. I mentioned this before, this CleanSpark, a Bitcoin miner, I'm more bullish on iris energy and I'm more bullish on bit tier than I am on CleanSpark at this point. All right guys, if you haven't left the like, do leave a like and until next time, make sure to take care of yourself. As salaamu alaykum and peace be upon you all.