Trump is good for bitcoin

 

Trump tends to reach for the easy button to make people happy or make money.   I am rethinking my stance if bitcoin at 145k as my target.   Instead, I am revising to 400k-500k as a 2025 target.   Specifically I am thinking bitcoin will hit upper bound of this chart.

https://websurfinmurf.blogspot.com/2024/11/bitcoins-end-game.html

Bitcoin may become an asset banks will allow loans taken against it as collateral.  Whenever this does happen, that should indicate a top will be approaching.  I suspect bank loans will be on the next wave, but it’s difficult to see how bitcoin as an asset changes under Trump.

I cancelled my bitcoin sell order at 145k.  If bitcoin approaches the upper bound of the chart above, please consider selling if the money will make a positive impact to your life.

Can Trump fix world finance?

President-elect Trump during his first presidency,  oversaw over 50 major departures from his administration. We witnessed significant turnover for various reasons: some officials received "too much attention," diverting focus away from Trump, or simply sought to perform their duties with some degree of independence.

In the years ahead, America will face economic challenges unlike those seen since 1929, and we need strong leadership to navigate the storm. The misuse of the U.S. financial system, both domestically and globally, is severe. When we need the world's support most, we risk burning bridges with our allies, while our adversaries may rejoice at our downfall.

If Trump consolidates power by directing all actions or surrounding himself with blind loyalists, he will stifle the distribution of power within the U.S. government. The outcome—whether wildly successful or a failure—will hinge on Trump and the Americans who supported his promises to dismantle the system. If dismantling the democratic system is pursued, America in 2028 will look nothing like it does in 2024, as division and internal conflict escalate.

Let’s hope I am wrong, and that Trump will unite Americans, empower democratic institutions, reinvigorate the populace, inspire individuals to strive, and change the rules of the game to make the American dream more attainable.  If the dream dies, I can't see anyone caring about the stock market anymore, except the 0.1%.

Future employment with AI

 

AI's Revolutionary Progress and Its Implications for the Future of Companies

AI is advancing at an extraordinary pace, and most people remain unaware of its true capabilities. I operate under the assumption that no matter how much I read and learn about AI daily, I am still behind the curve of what’s possible. What I’m about to discuss has already been achieved in various forms (wherever possible, I’ve included links), and the extrapolation is simply that these developments will become even better and truly viable in the near future. None of this requires true AGI, we simply need to make AI "a tiny bit better" than an average person.

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The Virtual Company Revolution

Future companies will be founded by individuals or small groups who instantiate a virtual company. These companies will consist of fully virtualized employees, each with unique specialties and dispositions designed to maximize the chance of success. Every virtual employee will have individual memories and histories, allowing for iteration, continuous improvement, and the avoidance of repeated mistakes.

Human owners of these virtual companies will need access to seed capital. Knowledge work companies will find it cost prohibitive to staff highly skilled human employees as compared to the alternative, as a function of potential progress in a given year. Once operational, these virtual companies can function autonomously, with human founders acting as a decentralized autonomous organization (DAO) or a board of directors, conducting periodic reviews and offering strategic advice.

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Autonomous Operations and Financial Independence

Virtual companies will independently manage assets, including cash, to fund their AI capabilities, run experiments, and evolve their missions. For this to work seamlessly, companies will rely on decentralized financial systems. Bitcoin is a prime example of a capital system outside government control, making it an ideal candidate for these operations.

To succeed, the majority (95%+) of a company’s operations will be virtualized, including:

• AI provisioning: Dynamically allocating computational resources.
• Knowledge specialization: Hiring AI agents in specific domains of expertise.
• Execution: Meeting objectives through automated workflows and smart systems.
• Subcontracting: Automating or virtualizing third-party work.

For instance, a virtual company requiring research could hire a virtual researcher to design experiments and produce whitepapers. To maintain competitiveness, such processes must be automated as much as possible, ensuring objectives are met faster than the competition.

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Competitive Advantage and Wealth Creation

The last century has demonstrated that wealth accumulates where new capabilities are created. The wealthiest individuals or organizations often dominate markets by being the first to develop or commercialize transformative technologies. In this paradigm, the new top 0.1% will be those who can fund and deploy virtual resources effectively to create value in the marketplace.

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Implications for the Majority

For most of us, thriving in this new era will hinge on interpersonal skills, as most knowledge work becomes outsourced or automated.  The ability to foster positive relationships and collaboration will become paramount. Skills like Mindfulness and Emotional Intelligence will be invaluable. Developing and certifying these competencies could be a key strategy for staying relevant in a world increasingly dominated by virtualized expertise.

AI will create exponential advancements to human kind, but with it comes responsibility to adapt.

NOTE: I had AI take my thoughts and create this article.  Special thanks to Bob who commented I can't write a post well :)

Bitcoin to 145k or beyond?

I wrote on November 4th bitcoin to 145k in 2025, bitcoin was at 67k.  It is poised to break 100k in the days ahead.

Looking closer at the chart I called out Nov 4th, it looks like bitcoin is breaking out.

If this thing goes parabolic, I will likely not hold into 2025, 145k is still my target.

Democracy may end

 I am an independent voter, I support the US Constitution.  Democracy is based on power comes from the people, not a single individual.  With that said if we choose to end democracy, I will not stand in the way of the will of the people.

Dramatic? Ill check back in 2028.

If Trump wins, America will be torn to shreds  by 2028.

Buckle up.

https://youtube.com/watch?v=BP6_cI5UUZg&si=AVTVuVxG9VahED0v

Bitcoins end game

Using the history of Bitcoin as a guide, it will continue to go higher up towards $1 Million a coin.  

There are events that can change this trajectory, such as a "new better bitcoin".  One potential is the FED releasing USD blockchain.

How can you tell if the trend is dead?

There is a bitcoin "power law theory" that illustrates the price of bitcoin over the last 15 years:
https://giovannisantostasi.medium.com/the-bitcoin-power-law-theory-962dfaf99ee9

According to this graph between mid 2025 and end of 2025 we should see a near term peak of bitcoin of ~$150K, with a pullback to ~$95K.

If you see bitcoin break below the red line, I expect bitcoin to enter a freefall, simply because big money will be watching the bitcoin trend over the last 15 years and recognize something has changed.

https://charts.bitbo.io/long-term-power-law/

Based on this, it is reasonable to consider selling a coin in the blow off into 2025, maybe ~$145k.
Good luck!

The ride up, until its down

The market is at all time highs, and its anyone's guess if this continues into next year.  With the world printing cash, the cash must flow to assets.  And right now, USA is the best place for assets in a world having challenges.

This does not mean average Americans are being prosperous.  It means loose cash finds whatever the world thinks is a safe investment.   When the loose cash ends or people panic, no one can predict exact timing.  But it will end in 2025 (if not sooner).

When it does, fear will take over hard core, and US bond rates should plummet.  When this happens it will be the LAST time you see rates this low easily for a decade.  Ideally move out of bonds into energy, commodities, gold, bitcoin, even oil.   Can also invest in technology such as AI or biotech.

What could change my outlook? Average Americans having lower costs, gainfully employed, paying down debts, and growth in consumerism.  Without this mix, we will all struggle to keep things afloat.

I do think after this crash we may see inflation in the decade ahead balloon as the world prints its way out of debt, and its obligations to baby boomers. 

Buckle up!  Enjoy this stock market, for it won't be the same ever again.  Easy money days are almost over.

A Lesson of when you are right, but wrong

 My last post asserted SPX hitting 4900, it hit 5120.  This is a prime example when you are right, but yet still wrong.  This is what the market is excellent on doing.  We did get a market decline and rally into the election as I asserted. 

But what I did not get is a decline to the target I thought.  Lesson is always trade out of positions when you are right, and don't wait until perfectly right.

I did close out of short positions, in the case of shorting Stellantis, it all worked out well.  But for SPX, I let quite a bit go back.

Looking ahead, while the market should be topping, I am reserving this from a declaration.  The reason is China is printing printing printing.  With loose money it will flow to whatever it thinks is a good investment.  I expect gold, bitcoin, and potentially the US stock market to benefit.  The reasoning is China's economy is a disaster, I question if the CCP will be in control by 2030.

Worse yet, we will likely get inflation in the USA, and the world, because of the Chinese printing flowing into hard assets.  Also Russia is attacking Ukraine international grain ships that will result in less world wheat.  These two items will force the FED to not cut rates, ensuring our economy doesn't get the support it needs.  I suspect the FED will know this and will ease in "different ways", like its special operations.  The interest rate lever is used to pretend it is the master controller of inflation, and while a component, it is hardly the largest one.

If assets do rise, the US pundits will use this to confirm the US economy is doing great.  Far from it.  The housing market is turning bearish (click).    And I personally know multiple people unemployed, some over a year in IT.   There isn't a crazy amount of layoffs, companies are simply hiring at a minimal level.  This is the first step to having an employment problem as the unemployed accumulate.

Where does that leave us?  With China printing we may get another goose up.  If it does Bitcoin & Gold is a good play, and the market.  Stay into the market going up, but if you get concerned listen to your gut and capture gains.  There is nothing wrong with sitting on a portion of your cash in fixed and sit watching into Q2 next year IMO.

Short to spx 4900

 We didnt reach the low into the election, when things hit below spx 5000 i will cover most things.

So if you are long in the next week or two, be prepared for some pain.  Ill join you as a short term bull soon.

We just experienced a counter rally, going down or up is never in a straight line.

Whats next?

 When the FED started to raise rates in March 2022.  At that time the Fed said it takes time , over 12 months before the effect of raising rates can cool down the economy.  The Fed raised incrementally rates from March 2022 to July 2023.  The overnight rate went from 0.25 to 5.5%

Since July 2023 the stock market has reached new highs and bond rates have actually fallen.  

The stock market had issues at the same time Japan had issues last Friday into this past Monday.
Now the market is calling for the Fed to cut.  Does anyone doubt the fed will cut if unemployment rises or the stock market destabilizes?

While its possible they don't cut, even the Fed set expectations they will in September.  What is the rate we are talking about?  Its the rate the Fed will pay some financial institutions to deposit their cash with the fed at a set annual rate on a nightly basis. 

Notice, this is NOT the 1/2/3/5/7 year, 10 year, 20 year, or 30 year US bond rate.  It is not car loan, credit card, or mortgage rates.    So a rate cut of the fed rate doesn't automatically cut borrowing costs.

It took 2 years from March 2022 first cut to have material inflation decline about March 2024.  Why do people think reducing rates by 0.25 or .5 from 5.5 to 5.0 will positively impact the economy quickly?

It can't because what the Fed rate does is influence financial institutions to seek gains from different financial activity instead of parking cash at the Fed.  When banks and other institutions change their investment strategy it takes TIME.

Therefore it isn't possible for a fed rate cut to 'save the economy'.  There are potential other events that will give a really good boost for a bit even if unemployment continues to rise.  But barring dramatic events, the dice is cast, the market has peaked.

Could we see a new high in the next couple of months, of course.  But when the Fed does cut rates, its them saying "we see the economy has taken a turn for the worse", and their action will start to help the real economy, in a year or two.

Now for other potential bad events, last week the reason the US market tanked was Japan had material challenges in their economy, including their stock market falling over 10% in a day, and the Yen appreciating dramatically.  This hurt US financial institutions using Japan as a "safe place to borrow money cheaply and use it to invest in USA or world".  A shift of rate hikes, Yen appreciation, and Japan market decline basically forced financial institution borrowers  to liquidate assets to have enough cash to cover the shift.

This is NOT the last major event, it is the first.  Think January 2008 when US market dislocated on a Monday.  Its a warning shot.

What to do? Secure assets in financial institutions that explicitly state FDIC insured up to 100K, or buy TLT ETF.  

When the Fed cuts, beware of long duration bonds as I expect markets to have long term rates rise in anticipation this next round of Fed Rate cuts will be followed by even higher hikes to tame inflation again.

If you can remain financially well of, I do expect investments of a lifetime available in 2026-2030 that will be the rocket ride of a lifetime with AI bringing in profits.

Good luck!

The top is in, now what?

 Hello! Its been a while since I posted.   I sold all my crypto a few weeks ago except my core bitcoin.  I lightened up on longs (not that I had much!) a few weeks ago too.

Now the market is correcting.  I will be exiting my shorter term puts between here and S&P 500 between 4,800-5,000.
I really doubt we will see a 2008 crash.  I do think we will see insane swings in the market, with an overall trend down.  The market is opening up insanely down today, and we could get more.

But when the S&P500 is below 5,000 its getting a little over-sold on such a short term.

In the chart below is the SPY, and we will see the 50 day moving average hit at between 4,800-5000 depending on the day in the weeks ahead.

I do expect August as a month to be DOWN, so I am not talking a meaningful bottom here.
My goal will be to roll over puts dated 2025 to 2026 and hold.

Overall, safest is 1-5 year US bonds and/or investments in core companies you think are worth it for 10 years.  I do think the next 5 years will not be great for the stock market, but I do think eventually AI will be explosive.  Its just a little too soon just like 2000 with the internet.

Good luck.

Latest and Greatest

 Been a while!  Watching the index slowly drift higher has been a bit boring. :)

The stock market is holding, but there are so many cracks its hard to understand how it drifts higher.
We have bitcoin breaking down,  skyrocketing household debt, bankruptcies skyrocketing, car repos skyrocketing, new/used car market collapsing, US bond market rallying hardcore today,  CVS/Walgreens/Rite Aids closing ,  Banks failing,  Market Crash signals triggering, Housing prices collapsing in SOME areas of America,  some commodities (like lumber) falling so hard being sold at a loss, unemployment rising, and so much more!

If we see a stock market fall, there is so much leverage that all assets should lose value.  This includes crypto.  I recently sold all my crypto except bitcoin.  My safety position is in cash, shorts, and some outside USA investments (INDA, MSCI).

The only reason I can see America's market continue to levitate is out of all countries, it is still the best bet.  Canada, Europe, China, Russia, and other major economies are facing very strong negative economics.

China isn't dumping US bonds, it is failing as a nation being forced to sell US bonds to try to prop up its currency.  

Such a cheery post!  I been expecting this moment since 2009 to peak between 2020-2024, that I am tired of it and just want the next shoe to drop.

Pay down your debts, stay in a safe job, lower risk investments and buckle in!

I am not sure even the  Donald promising he can fix everything will turn this around.  If AI makes some insane breakthrough it may help the USA remain the best of a debt ridden, demographic disaster situation.

No Flash, Shorts covered

 I covered almost all my shorts Monday, as Friday or Monday did NOT get a meaningful low.
We are in an "A wave" down, following Elliot Wave Theory".  We will get  a B wave up, probably around SPY 5005-5050 range, and then we will get a major wave down bottoming in May.

So enjoy the ride up over the weekish again before the pain train returns.
I am looking for re-entering shorts in the range above.  Good luck!

Flash Crash Ahead

Leading up to April 9th I went heavy short.   With news of explosions of Iran combined with 5 days of market weakness, a flash crash maybe on the table.

If we get an extreme market down, I expect SPY 4900-4800 range to hold.  If correct, the counter rally will be very painful if short.

Its very hard to cover shorts when your finally in the green.   Lessons from the past, nothing goes in a straight line.  I may go long or simply wait to get reshort.

If we break on a closing basis SPY of 4800 its going to get very interesting, and being short would be huge.   But I cant take that chance with such a sudden drop.

Good luck

Is the top Finally in?

 If you look at the market leader NVDA, it has been moving sideways since first week in March.  This is either eating time off the clock for a new explosion up or there is material selling occurring since then.  If the latter once the late comers have exhausted their purchases, we can expect a 20-25% cut in price.

Since NVDA market cap dwarfs all other stocks in the S&P 500, this would be a material top until a new 'growth story' like AI with NVDA can drive the market higher.  

Consider stops to keep profits and be ready with some cash.  I expect this bear market be a up, down, up, down, repeat through the election. 

The BEST guy to watch for daily targets is: https://www.youtube.com/msforecasting/videos

The end of the middle class

This blog started in 2008 with the pending global financial crisis was about to begin.
Since then, I have been concerned as the global financial system and the future of Americans financial future.

Back in 2009, I called out the demographic challenges, the future decade of inflation, and the decade of increasing interest rates.   Since then in January 2020 I raised the pending pandemic.

Since then I dramatically reduced my post-rants and typically post only when I see more extreme situations.

I been following YouTubers that are very good, they have more time and ability to share information than I do.  We are on the precipice of a financial crisis that will be felt for a decade.    AI will produce immense wealth, for the few.  If you have money you can increase your gains providing you can own part of these companies.  If you don't, things will get harder.  

I urge you to learn more on what the world is facing, and get ideas on what you can do.

Eurodollar System - The driver of the world economy

Zeihan covering the changing Global order.

News on the second largest Economy, China, Uncensored.

A Fun stock market guy, mostly for entertainment, he does call out key news.

You want to get rich day trading? You will IF you do exactly what he says

And finally The Real Estate Ninja started on real estate, and his scope is now beyond to the American middle class.