Dr. Jeff Ross: 4 phases explain why bitcoin will go up forever in value

Finally what Bitcoin must do before it becomes global money…

Mar 20, 2024

Dr. Jeff Ross: 4 phases explain why bitcoin will go up forever in value

Summary:

Honored to have the Doc on the show and have him breakdown where bitcoin value is ultimately headed no matter what talking heads say plus how he sees the fiat markets playing out globally. How Bitcoin is exposing the biggest problem humanity faces. Finally what Bitcoin must do before it becomes global money… We even have some fun at the end of the pod with a new little game we started…enjoy!

Presented by Bitcoin Trading Cards

Bio:

Dr. Jeff Ross is...Founder/CEO Vailshire Capital Management LLC #RIA & Vailshire Partners LP hedge fund (2013) | Physician (IR/DR) | MBA (Finance) | Not the views of Vailshire!

Connect with Dr. Jeff here:

Twitter: https://x.com/VailshireCap?s=20

Nostr: primal.net/p/npub1k7vkcxp7qdkly7qzj3dcpw7u3v9lt9cmvcs6s6ln26wrxggh7p7su3c04l

Company website: https://vailshire.com

Timestamps:

00:00 Bitcoin as a Paradigm Shift

10:00 Bitcoin as a Store of Value

11:44 Four Phases of Bitcoin Becoming Global Money

15:15 Deflation and Free Banking

30:13 MicroStrategy as a Bitcoin Holding Company

32:17 Bitcoin's Counterintuitive Nature

34:12 Warren Buffett's Cash Strategy

37:35 The Importance of Capital Allocation

38:04 Shareholder Proposals for Bitcoin Allocation

40:17 Dr. Jeff’s Macro Indicators

44:07 Bitcoin Price Predictions and Bull Market Timing

49:45 The Impact of Nutrition on Human Health

53:33 The EndGAME

Transcription:

Brandon Gentile

We have found another playable character sports fans. Dr. Jeff Ross has graced us today, formerly Dr. Bear, now Dr. Bull Crab, I believe, if I'm correct, the founder and CEO of Valeshire Capital Management, LLC, is a registered investment advisor, Valeshire Partners, limited partners, hedge fund, has an MBA, and also somehow, again, is a physician. I don't know how you do it.

Doc, how are you?

Dr. Jeff Ross

Hey Brandon, I'm doing great. Thanks so much for having me on your show. I'm excited to be here.

Yeah, I would joke with everybody that the show is playable characters in, you know, you more than most people can see being in this space now for years. There's there's not a lot of a sea of non playable characters, and there's not a lot of critical thinking going on in the world. So we're trying to find the ones that are playable for those of you out there wondering why we do what we do, why we call it that. So, again, I appreciate you being out here. I want it. I want to jump right into some of the things like even the thing you tweeted out. I've got numerous things, but you tweeted out even today earlier.

You know, don't lose sight of the bigger picture. This is a marathon, not a sprint. And we've gone really to this next phase, which you have here, which is collectible kind of novelty and then store value number two, three, medium exchange for unit of account. Can you kind of go into this and how your thought patterns, you, this is, this is a theme of kind of how you are, your personality, how you've talked forever, just to kind of be the calm presence in the room, what, you know, walk me through these kinds of stages here in the viewer so you can kind of, uh, we could delay the land here.

Doc

Sure, so there's a lot of talk about what Bitcoin is and what it isn't. Bitcoin is a pretty complex topic, but it's also pretty simple as well. You see people getting kind of worked up and you see mainstream take false narratives and really run with them. So I sort of like to be, you know, I'm old now. I can claim the old card. I'm 49, pushing 50, and I've been around the block a few times. Like you said, I'm a doctor and I run a hedge fund and so I've experienced a few things in my life.

Bitcoin is awesome and it's so fun to be a part of it at its inception. To me it's about the equivalent of two different things. It's like the inception of the internet and watching that progress and watching everybody make fun of it initially and say it's just used by criminals and has no real use case other than electronic mail and what the heck is that. I was in college when email came out and I was like, what the heck is this? But it was kind of cool and that's about all I saw.

And so watching normies in mainstream not understand what Bitcoin is or where it's going to me is just super humorous. Uh, and it can be frustrating at times, right? And Brandon, I know you're a great teacher in this space as well. And so we spend a lot of time just kind of helping normies figure out what's going on and why we think it's such a big deal. The other thing that I think it's like being a part of it, and this, this sounds excessive, but I believe it.

I think it's like being, like the founding fathers hanging out at coffee shops before the American revolution started and kind of laying the groundwork for a new America. That's what I think this is. Like that's how significant I think this is, is I think this is a world changing technology and we get to be a part of this paradigm shift. And so I try to remember that too. Like I spend my time teaching people and a lot of people ask like, why I'm so into this. Like I'm a Christian. Like I got lots of other stuff. I got.

lots of things on my plate. Why do I spend so much time talking about this stupid thing, you know, all the time? It's because I think we are literally at the precipice of a new world. It's a paradigm shift. And so to me, this is extremely important and it's extremely important to help people understand what's going on. And ideally they can get in at the ground level and help to build this and help to build this better world. I like the way Michael Saylor talks about engineering a better tomorrow. A lot of engineers think like that.

Like, let's be optimistic and let's think about where the world can go and all the implications. And so it requires people to spend a little time thinking about this. And so anyways, so that's why I have the views that I have and why I talk about Bitcoin so much. Getting back to your question about my tweet, I brought it up because Michael Saylor brought it up yesterday. He was on an interview on CNBC with Andrew Ross Sorkin and who's definitely a Bitcoin skeptic.

And sailor does an awesome job at remaining winsome and optimistic and not being confrontational. I love that about him and I have a lot to learn. My other kind of hero in that way is a Jeff Booth. They both just have this relentless optimism. They don't get dragged down. I get, I can get dragged down and, and go start fighting the normies. And that's just not very productive, right? It just turns into a screaming match and people calling each other stupid and things like that. So.

What I like about him is just his way of thinking about things and helping people think about Bitcoin not as a trade or as a speculative asset, but as a long-term savings vehicle. So his push yesterday was quit thinking of Bitcoin as a medium of exchange, as a cryptocurrency, as basically it continues to get labeled as. Think of it as a store of value. And I say this all the time, and you know, Brandon, we've talked about this forever. The biggest problem the world faces today is the store of value problem.

Why? Because government fiat currencies literally exist to steal the purchasing power of their citizens. So the reason we've seen the largest centralized nation states, the most powerful nation states in the history of the world over the last 50 years or so is, I think, completely because of fiat currencies that are controlled by the government. Why does that matter? Because they basically control inflation. They control the rate of debasement.

of their citizens, meaning they're stealing the purchasing power of their citizens over time. They're collecting all those benefits that we should be seeing as humanity, as citizens. We should be seeing this benefit of ever decreasing prices because as humanity and technology progress we should see those benefits and that should be reflected in lower prices and a higher quality of life.

That's not happening. Why? Because the government methodically, and I'm not even like a government conspiracy guy, I'm not a tinfoil hat guy. I just don't care usually about most government stuff, but they literally, because of the design of fiat currency are stealing our purchasing power. And they have been for many, many decades. They get ever bigger, ever stronger, ever more powerful while we get, uh, we get the shaft, right? We're on these hamster wheels.

working our butts off forever and ever, dreaming of some retirement someday, which most people will never experience because life is getting more and more expensive. So that's why I make such a big deal about Bitcoin. Where are we right now? There are four phases basically for a society to accept a new form of money. And they go, all things, all forms of money. And Safedin Amoose does a great job on this and other authors have talked about this in their history of money books.

But it generally goes through four phases. A form of money starts as a collectible, then it turns into a store of value, then it becomes a medium of exchange, widely accepted, and then it becomes a unit of account for, like on a personal business and nation state level. I think, and I think this is what Michael Saylor is alluding to, people are pushing the Bitcoin narrative too far, too fast. They're kind of talking about it, well, what an amazing medium of exchange it is, the lightning is everywhere, it's awesome. And I would...

push back on that and I have just being realistic, right? I'm a fanatical Bitcoiner, but it is not a ubiquitous medium of exchange. It still has a lot of kinks to work out. It's getting there and it's being developed. And from talking to people like Jeff Booth and Lynn Alden and Preston Pish, and you know, they're, they're part of ego death capital and other venture capital type people that is all being built out right now. And so we will see that medium of exchange component be built out, but right now we are firmly in step two and that's the store of value.

And what's fun for me, and it's probably because I come from Wall Street initially, that's where I came to Bitcoin way back in 2015, because Wall Street is officially embracing it as a store of value. Larry Fink gets on CNBC and Bloomberg TV all the time and talks about it as being a store of value. He says it should protect or it may protect against government debasement.

And so consider Bitcoin as basically the store of value that you've always needed and always wanted. And then my final thing, and I'm sorry, I'm just going off a huge tangent. We can take it in different directions. But why I call the store of value the biggest problem humanity faces, we've seen this being reflected in the valuations across the board of different asset classes. So as a hedge fund manager, I'm always looking across different asset classes and looking for where there is value, potential investments, things like that, things that are overvalued and things to avoid.

and those are perfect.

Doc

The store of value problem has found its way into, and when I say the store of value problem, I'm talking about the monetary debasement problem that all humans face. Their goal, all of our goals from a financial standpoint is to work and to preserve our purchasing power and hopefully grow our purchasing power over time so we can actually pay the bills for ourselves and our spouses and our kids and our grandkids and things like that. Like that's what we're all in general striving for. And Fiat government...

currency takes away that from us. It takes away our desire. It doesn't take our desire, excuse me, it takes away our ability to do that effectively. And so that store of value premium, the monetary premium has been placed across multiple asset classes. So we see these large premiums on stocks, real estate, this real estate bubble where things have been getting wildly overvalued and people are using houses as speculations as ways to preserve and grow their purchasing power.

That's crazy if you really take a step back. I think we're gonna look back 10, 20, 30, 40 years from now and look back and be like, can you believe people used to like trade houses? Like they would buy them and sell them for a profit. Like that's crazy, right? Like what people really need is shelter, affordable shelter. And the millennial and Gen Z cohorts have basically been priced out of the housing market. And that's actually a tragedy. That has huge consequences on society.

And so that's just one of the ways that this whole store of value problem has found its way into other asset classes. You also see it in private equity. We saw it in bonds actually as well. So anyways, that was a really long answer to your original question, but we can take it whatever direction you'd like to.

No, you made me think of so many good things. What I, the one thing I see, and you kind of mentioned this too, which is it's really hard and it goes through these four points. It's, I feel like, and it's generally the normie. I think Bitcoiners are better with it, but it's being able to live in both worlds. I feel like that confuses so many people. And it's like, well, it's not an immune. Can I, I mean, how many times you.

Can I buy a gallon of gas with it? Can I go, I mean, it's like living in these two worlds is very hard for to educate people on. You kind of just have to get like, get it yourself. No one can like, you know, you can lead a horse to water but you can't get him to drink it. And the person has to do the study and kind of get across that hurdle, that mental hurdle. The other thing I was thinking of too is deflation. You mentioned this. Obviously, you know, Jeff Booth talks about this all the time as well, you mentioned, but to me, this is...

It's such a paradigm shift and we've all known inflation our entire lives. And we've everyone, I mean, pretty much anyone alive has only lived in an inflationary world. I think that's probably true at this point. One hundred and ten years, one hundred and eleven years, the Federal Reserve. You have this world where no one knows anything different. It's like, does a fish know he's wet if he's been in the water his entire life? Like he just it just is. And everyone I see, I mean, you get the George Gammons of the world, you get a lot of these people I'd love for you to touch on people. You know, deflationary money can't work. Don't you know, Brandon, don't you know, Doc?

You know, this is can't we tried free banking. We tried it in the 1800s and you know, we couldn't do it. Ohio had their own money in Colorado and Michigan. They all had their own money and it doesn't work. This is the instant settlement and digital money. Doesn't that, you know, doesn't that render this moot? I don't know what I'm missing here. Can you go into this and just, you know, touch on deflation, but also this free banking that people just seem like, especially the gold bugs in libertarians or whatever, is a lot of them just can't seem to get over that mental. I love for you to touch on that because I've been thinking about this for a while and I don't understand why people can't.

make that connection.

Doc

Sure. So several interesting points to go off of here. So first of all, I don't think of Bitcoin. I've sort of changed the way I think about it. And Jeff Booth has helped a lot with this for me in listening to him talk about it. Bitcoin itself isn't deflationary money. And I've said that in the past. And so I need to redact everything I've said. Bitcoin is neutral money, right? It's an unchanging monetary supply. So right now, the supply issuance is disinflationary, meaning it's decreasing.

over time as the new Bitcoin comes on board. But overall, there are 21 million. There only ever will be 21 million Bitcoin, right? Lots of them have been lost too. So I think the best way to think about Bitcoin is it's neutral money. And when we're talking about deflationary prices, that's because, as Jeff Booth again, eloquently points out often and much better than I do.

Life is should be deflationary as humanity progresses as technology progresses We should see that being reflected in lower prices and a higher quality of life Bitcoin simply reflects that so as it goes up in value what I like to turn it on its head Everybody gets all you know focused on the number go up technology and you I like to think of it as prices go down technology I think that's a better way to think about it. I also think it's healthier and it's less

So I love that and it sort of separates it again. It creates more separation between proof of state crypto, which is nonsense, speculative garbage, and number, you know, prices go down technology. So that's just a healthier way to think about it, because we're going to be, I believe we're going to experience that for the rest of our lives as Bitcoiners living on a Bitcoin standard and as more and more of the world adopts the Bitcoin standard, we're just going to see prices go down over, you know, over time. And I think

Sailors right he said, you know, it's going it's going up forever what he means if you turn that inversely as prices will go down forever I believe that I don't think they're gonna go down as rapidly as they are this decade Certainly, they will never go down as rapidly as they did last decade last decade from like 2011 to 2020 at least by my calculations The kegger the compounded annual growth rate of Bitcoin was about a hundred and eighty nine percent hundred ninety percent I think that's slowing down this decade to around fifty percent ish

And I think it's going to continually slow down and it will eventually reach sort of a basal rate that will just sort of reflect the growth of humanity and the progress of technology being reflected. So that's what I would say about that first part. Shoot, what was it? We had a two part question.

Oh, yeah, deflation number one, like I love you, you know, you and Jeff who say that it's neutral money that captures deflation. I love that. And then the other part was the free banking, you get a lot of the gold bonds, whoever right and saying, Oh, we've tried it.

Doc

Oh yeah. Yeah. Lots of people, I don't know why, but a lot of Gen Xers who are prominent speakers talk about this and I feel responsibility because I'm a Gen Xer. I'm right in the middle of Gen X. And so they're smart people. I listen to these people regularly. They have great macro takes. They understand the world, but they get stuck on certain issues with Bitcoin and so they still can't quite cross the Rubicon and come over yet.

It's just so interesting to me. So I think that what they're missing is Bitcoin, they think of, they love to compare and they talk about private money and how all of these private monies by banks failed. I think that's like saying multiple intranets failed in the past and they should fail and they will fail. And that's actually how I view, again, proof of stake cryptocurrencies. Those are intranets.

Those are literally like, look at my marketing campaign, look at this cool thing I do, come over to my blockchain and we're going to change the world and make a bunch of money. It's just all nonsense. And they literally have just devolved into nonsense. They still are making 100X their gains. Who makes 100X their gains? It's the people that the influencers put out a ton of marketing for and venture capital backs and then these little tiny nonsense coins go up 100X or 1000X. And people think that they're being smart.

That has nothing to do with Bitcoin, right? So Bitcoin to me is like the internet and all of these proof of state cryptos are like the intranets. So when people talk about, well, all of these private currencies failed in the past. Well, yeah, that's because who's going to use this? The Bank of Ohio's money. You can't use it anywhere unless you're within a 20 mile radius of it. You know, it's just it's so limited. It's they were obviously destined to fail. It was sort of an interesting experiment.

When people compare that to Bitcoin, they're just being, for lack of a better word, they're being stupid. They don't understand that Bitcoin is like the internet. It's everywhere. It already is ubiquitous. It's already accessible by everybody. It's literally decentralized and secure and designed to be the money for the world. So the internet of money, as Jack Dorsey would say. And that's true. And so those people just don't understand that. They're limited. They're thinking of it like a company intranet.

And that's just a bad comparison. So they're gonna learn that over time, right? It's it's the same kind of people who say like well What if they just shut down the Bitcoin network and I like to say well, you know If actually shutting down Bitcoin is as easily as just shutting down the internet Which is to say you can't shut down the internet, right? And then people are what if there's a world war or something like well still the internet's gonna survive in different parts of the world And as long as one Bitcoin node survives somewhere Bitcoin survives, right? And so

All of those kind of arguments are just baseless and stupid in their fear. They, you know, they cast fear, uncertainty, doubt on people. That's fine. It keeps the price lower for now. It helps us to get in at cheaper prices. They're eventually going to learn. I went through all of these very things myself. I was very concerned that the government was going to shut Bitcoin down back in like 2019 and 2020. They possibly could have, but there's really no reason to. And again, for a government or even a coalition of governments to ban together, to try to stop it.

it would be massively expensive and in the end they would lose anyways. And so it's kind of ridiculous. So, uh, I guess that's, I'll stop there. That's what I have to say about that.

What would it be almost similar to if you're playing Super Mario or you're playing Grand Theft Auto and you're using the currency in game and you're trying to use that, you know, in the real world in a sense or like this internet like yeah it's great for like that community that little thing you guys are using it for but you can't go take this.

the shit coin or you can't go take this other thing and go just start using it. No one's on your network. No one's using it except you people playing this game with, you know, in the console. Um, it just makes me think of that. But like you said, it's, it just, you know, people haven't done the work yet. I guess that's all it is.

Doc

Exactly, exactly. One other good comparison I like for people, which I think is pretty accurate, is think of cryptocurrencies as like Starbucks points. Most people have the Starbucks app and they understand like having points. It does have value in that little network, but you can't take your Starbucks points and go buy other things with it. Like you have to, there are things that you can actually sort of exchange them for other things of value, and that's how the whole cryptocurrency ecosystem works.

It's all these little value things, but they're totally dependent on the company. They're, they're dependent on a centralized, less secure entity or corporate entity. They say they're not, you know, securities, but they, I think again, they are, even though the SEC has continued to fail in proving this point. They just clearly are. They're, they're, they're little software companies with their little blockchain code.

And they're trying to promote it as much as possible so that the founders and the VCs can get rich and they can Leave the people who buy into it as bag holders eventually, so it's just all nonsense. It's it's fine And again, I just want to say one more thing. I don't actually even hate there are Bitcoiners who hate these things I don't hate them. I just understand people love nonsense people love to gamble people love I was just at the airport and some I watched some lady pull through I think like 200 pull tabs She literally spent like 30 minutes opening pull tabs and I'm like

People love to do that kind of stuff, man. They just, they love to gamble. They love to speculate. They love to be involved in nonsense. They love to be entertained. And that's what proof of stake crypto represents. And so I'm like, fine, you guys go all do that. But that just to be very, very clear, it has nothing to do with what's happening on the proof of work Bitcoin network. And Bitcoin is here to change the world. And it's a totally separate monetary and financial system. Totally separate. So what I get most bugged by are people who...

meld those two things together and make people, especially newbies, believe that Ethereum and Bitcoin are kind of the same thing and Dogecoin and Bitcoin are kind of the same thing and they're just absolutely not. So I spend my days basically trying to teach people how different those things are.

So really quick, and we've talked about neutral money, capture deflation. You've also talked about in the past many times that it's, you know, you believe it's very important to value your net worth. You know, look at your balance sheet, look at your financial statements in terms of Bitcoin. Can you just spend a minute kind of talking about, you know, kind of how someone does that, but also the importance of that.

Doc

Sure. So I think all of government fiat currency is just one massive rug pull. And it gets back to what we're talking about. It's literally designed to steal the purchasing power from individuals and corporations for the benefit of whoever controls it and who controls fiat currency. It's the government, right? It's the central banks and it's the treasury through their issuance.

they get the benefit from it. And it's designed to, when I say it's a rug pull, it sort of pulls the wool over your eyes, meaning that you can think in nominal US dollar terms that you are getting wealthier every year because you look at your brokerage account statements, you look at the value of your house or whatever assets you may have.

And you think I'm getting wealthier because the percentage is a little green number and it has a plus sign in front of it and I have gotten say whatever I've made 10% on my stock market investments this year and another 8% on my house. Isn't that awesome? But what happens is because of inflation, so price inflation, which is different than monetary debasement but they're linked over the long term, you can actually be losing purchasing power over time.

Even though it looks like on paper your net worth is going higher. So Bitcoin I believe even though it's extremely volatile Over time it is the most accurate. It's the only honest Unit of account so it's the only It's the only accurate measuring stick basically so I've started doing this probably three years ago or so and I really do recommend this for everybody

First of all, as a financial guy, an investment advisor and fund manager, I think everybody should be keeping track of their net worth. I think it's a good exercise. Pull out an Excel spreadsheet and just go through everything you own, put that as your assets and then put your debt on there. Those are your liabilities and add the, you have the assets, you subtract the liabilities and whatever that number is, that's your net worth. I like to do that on a monthly basis just to know where we're standing because a lot of people think they have more money than they do and then they realize, oh my gosh, I actually am.

and in debt, I have a negative net worth and most Americans actually do have a negative net worth, which is unfortunate. Bitcoin, I think actually gives you an accurate number. So what's interesting like for case in point, for most people who do this, most people's net worth in US dollar terms has gone up, up since the end of 2022. So since the stock market has returned and since Bitcoin has increased in price and values have kind of bottomed and started rising again,

A lot of people see their value increasing significantly in dollar terms, but then interestingly, they're actually decreasing in Bitcoin terms. So if you have a bunch of fiat assets, and I'd look at anything basically outside of Bitcoin as a fiat asset, so your house, your stocks, your bonds, whatever, they may be going up in value, but they're actually losing in terms of Bitcoin. So their real valuation is actually going down. So

I just think it's a healthy exercise for people to think about that. It helps people develop a Bitcoin standard much more quickly when you watch your Bitcoin, when you value your life and your net worth in Bitcoin terms. Highly recommended. I think all people should do that. At the very least, value it in dollar terms. But once you start to understand Bitcoin, you understand you want to use an accurate measuring stick, an accurate ruler. So if you want to actually accurately know what your net worth is, you should be doing it in terms of Bitcoin.

Yeah, I think that's such a phenomenal idea. That's why I just one of the things I wanted to touch on here with you that you know, you said that you've been saying that for a while. What basically long story short, it will eventually at some point 10 years, five years, 2050, whatever it is, it'll basically just shrink down until you get basically to your allotment of Bitcoin that you own correct or someone has none. Go to zero if the dollar goes to zero right so

Doc

Correct. Right. I've even said that if I would quick tangent about MicroStrategy, right? So everybody emulates Sailor. I love Sailor. He's awesome. I don't think people should worship him. I think people get a little too excited about. He's just another dude, right? He's smart and he's great for Bitcoin. But anyways, we don't have to go down that tangent. MicroStrategy, and I've said this, and I'm a MicroStrategy shareholder. So full disclosure, I own it in my hedge fund. I own it across my Veilshare accounts. I also own it personally. I think it's the best stock to own.

because of his basically his Bitcoin stance and what they've been doing with their balance sheet. I've said and this isn't even meant to be insulting to him that the value of Bitcoin will basically cause the rest of the business valuation. So his software side of the business, which is all it was up until basically 2020, that will trend towards zero over time and all he'll be left with is this micro strategy will basically be a Bitcoin holding company.

I tweeted that out actually months ago, and then he came out about, I think maybe one month or a few weeks ago saying that they've officially redesigned MicroStrategy and designated as a Bitcoin holding company, excuse me, a Bitcoin development company, which is basically a Bitcoin holding company, which is to say, I think of it in terms of there are a lot of land holding companies out there. One popular one is called Texas Pacific Land. The ticker is TPL, which I've owned for a long time.

It's basically just a company that has a ton of land in Texas and around the area. And they just, they have this tiny little staff that basically sells off land as needed, or they'll like lease out the land for oil and gas companies or for water rights. And they do all this kind of stuff. I think that micro strategy, because it holds so much Bitcoin, is basically just going to be doing the same thing. It's going to be basically Bitcoin management. Like, what do we do? This is a, it's not a technically a productive asset, but it is a massively

a beneficial asset because it increases in purchasing power over time by design. So just owning it is productive and is a way to preserve and grow your purchasing power. So I just think that's what MicroStrategy is turning into. And again, I didn't mean that as an insult to him, but it's going to drive the value of their software business basically to zero over time because Bitcoin just grows so much faster in terms of a kegger than his software business could ever grow.

Yeah, it's such a fascinating thing. And this goes back to what we were talking about earlier with, you know, everything being counterintuitive in a way like deflation for the average person or the normie is counterintuitive until you cross that Rubicon. Like we were saying, like a lot of the Gen Xers, the gold bugs, like it's very hard to see. And then it's like someone said this other day, it was like, you know, it seems absurd when you don't get it. And then once you do, it seems obvious, you know, it's just like, and there's a lot of stuff like that in life.

man, does Bitcoin fit that threshold where it just makes no sense living in this fiat when you're on the fiat debt based legacy monetary Titanic and you're just slowly going under the waves and it's just like, well, you know, the deck chairs aren't sliding and people like, what do you mean? It's the dollar. It's America. You know, like this is amazing. Which is the best dollars never going down. And we're on the life raft and you can easily see the further you get away. Whoa, this thing's going down guys. And you're yelling at each other on each side. He's still yelling at each other. Like you got to get off. Like no, you guys are morons.

You guys like going to this ocean, it's a little Bitcoin life raft. Like, don't you know? It's just it's incredible. And to this point, like I know you had you retweeted Dylan's thing. The biggest story in corporate finance is little known software company that used to trade at a one and a half billion dollar market cap. His balance sheet has grown for 500 million to 13 billion liquid in four years by doing nothing other than adopting a superior currency. What's the whole point of that, though, is what you just explained. I think it's so important for the listener, someone just learning Bitcoin. It's.

It seems like again, like the dollar value is going up and it is obviously the fiat dollar value. But in terms of Bitcoin, the measuring stick like, you know, Foss always says it's 11th grade math to me. I'm like, it's a seventh grade science experiment. Like it's the control. Like again, you just explained it beautifully. It's the you can't have more than one variable in experiment or else you're you don't know how to measure things. And to me, that is the control Bitcoin is the control. Now you can start testing and doing things off of that. So I'd love you to touch on any of that. But I do want to.

go into some Warren Buffett, like Gromman and Preston the other day were just talking about this. So I'd love to get your thoughts on his cash. And he just continually keeps growing his balance sheet with cash over the last really, what 15 years? And what's he doing? I guess is the question, what is happening? So I know thoughts on any of that stuff.

Doc

Right, right. So he's widely applauded for that strategy. And in the past, that has worked very well. Like that is a great fiat strategy to build up your huge fiat pile and wait for the markets to collapse and then be able to rush in like they did in 2008, 2009 and swooping and buy all of these things at a massive discount or get like very favorable terms on preferred stock and things like that.

That's the Warren Buffett method. It's made him a billionaire. Right. And, and I, um, I come from that school, right? I started Veilshire, my business as a value investor in the Warren Buffett style. Um, I used to listen to Preston Pisch all the time pre Bitcoin, and I went along with him on my Bitcoin journey and we kind of discovered it at the same time. And he's, he's what helped me be okay with that as a value investor, getting into Bitcoin, which again, back then was considered as this wildly speculative asset. Right. So anyways.

Mad respect for pressing. He's a he's a he's a friend of mine. He's a good dude. I Called first of all, I do have respect for Buffett even though he's obviously very misinformed about Bitcoin, right? He calls it rat poison and Charlie Munger. They both are just we're very he was very against it. I Get that right. He's old dude the dudes, you know, he's over 90 years old. Why would anyone care about what?

a 90 year old thinks about a new technology, right? So of course he doesn't understand it. He just got, he got Apple like 20 years too late. He doesn't invest in technology. He always says, I know nothing about technology. Basically, I like things I understand, like railroads and newspaper businesses and things like that. Bless his heart, right? He's been very successful. So he was the most successful fund manager of the last century, and that should not go unacknowledged.

And even though he has a bad Bitcoin take he just has he's in a massive excuse me a master capital allocator and so Many months ago. That's what I was saying about a sailor before this became kind of wide widely known that he was I said He's like the Warren Buffett of Bitcoin like he understands capital allocation

A lot of people use the term speculative attack, but I think that's too aggressive. And I think that raises the hackles of US politicians and financiers. I like the term, which I just coined recently, speculative arbitrage. And I think that's what he's doing. So, Saylor sees the differences. He sees the importance of being able to get rid of a debasing asset with favorable terms, like say 0.625% interest rates on his latest round of debt that he just issued.

and take that arbitrage opportunity and put that into very undervalued Bitcoin right now. And then over time, you see the benefits of that. So getting back to your question, Buffett, Buffett has this massive pile of cash right now. All of the value investors are golf clapping and saying, wow, look at all that cash. I think that's massively foolish. And I might do this, by the way. I still own a little bit of Berkshire just so I can keep my foot in the door there.

I think that shareholders should basically start demanding that while fiat brains think that's a wise strategy, I would say that's a very foolish strategy to hold a melting ice cube. Right? They have that huge pile in cash. I know when they say cash, by the way, it's usually sitting in short-term treasury. So they're probably earning 5% interest rates or so on that cash. Polite golf plaque, well, that's so smart. Good for him. He's ready. He's going to swoop in and buy stuff if the market crashes. In the meantime, though, he's...losing the purchasing power of his shareholders. It's actually not only is it not wise, I would say it's actually kind of dumb. I think that shareholders should put proposals out and Buffett would be the first the perfect first target. They should say you need to put at least 10% of your cash pile into Bitcoin because you're just losing our purchasing power like this is actually a bad investment even though a lot of people are giving them the golf clap on CNBC and Bloomberg.

That's my take on it. There are a lot of companies like that, that hold these massive amounts of cash or short-term T-bills. That's not very smart. So I would say that, and I hope Bitcoiners do rise up. Bitcoiners like me who still have one foot in traditional finance and the other foot in Bitcoin, we should start putting shareholder proposals out there for people to vote on at the very least because it raises awareness and it allows Bitcoiners to get to talk at the shareholder meetings and just be like, look.

Hey, we have this, you know, whatever, 100 billion plus dollars in cash. Let's put 10% of it in Bitcoin and just see what it does. 10% is not going to make or break the company. If we're right though, this could be, we could pull a sailor and have these massive returns. I think one by one, I think Berkshire will probably be the last to do that. Although we, you know, Buffett's not going to live forever, right? I'm a doctor. I understand that human life has its limits.

He's nearing the end, right? And I don't want him to die. I don't wish anything bad on him, but he's, he's not going to live forever and probably not that much longer. And then the younger generation will take over. I think it'll be interesting to see how they respond. And I think it's possible, um, the very people that got him, you know, to invest like an Apple stock, that wasn't Muffet's decision, it was the younger guy's decision, they may not be as opposed to, um, a Bitcoin as he is. So we'll, we'll see what happens in the coming years.

Absolutely fascinating. I appreciate your take on that. What are some things and you know, to get anything proprietary here, but what are some things that like, again, a pre-coiner or any Bitcoiners can kind of look at? Like, what are some indicators that you're generally looking at when Dr. Jeff opens up his dashboard every day? What are some of the things? You know, is it M2? Is it the real inflation? You know, what are you looking at every day? Just a couple of your things that the average person kind of give a gauge of what's going on in the world.

Doc

Sure. So I base most of my macro indicators. In fact, I base my moniker. So right now I'm Dr. Bullcrab, as you mentioned. I think there are five distinct phases. So I'll go through these real quick. It starts at bearish. So markets are cyclical and they constantly are ebbing and flowing. They start as bear market. So I was affectionately or disaffectionately called Dr. Bear back in 2022. And then it goes from bear to, to crab ish. So, so bear crab, there's bear, crab, crab.

bullcrab and bull. So we're not quite to bullish phase. And why do I say that? It's for me, it's really based on what is the global M2 monetary supply doing? What is US net liquidity doing? I'll just real briefly touch on those because that's where I start every day. That's the first thing I look at. So US net liquidity, US net liquidity is basically what is the central banks doing? What do they have on their balance sheet? The amount of assets, is that increasing or decreasing?

And then you subtract what's going on in the overnight reverse repo market, and you subtract the treasury general account from that. And when you get those three numbers together, you're left with something called U S net liquidity. U S net liquidity has been range bound chopping sideways like a crab. That's why I keep saying crab chopping sideways for two years. It's literally at the two year mark right now. And it's at the top end of that range. That's why I lean towards bull crab ish.

Bullish in my crab zone, but still crab ish. It's still chopping sideways. It still hasn't broken out of that range Why does that matter? US based assets are strongly correlated with what US net liquidity is doing And so when I say US based assets mainly US stocks, so US small cap stocks mid cap stocks and micro cap stocks

generally follow and I get a kick out of so many people who don't get this or don't even believe it. I'm like, look at the charts. It's almost impossible to deny. You can literally watch these things go and within like a week or two, small cap stocks tend to follow exactly what US net liquidity is doing. So that would be my number one giveaway secret. Follow US net liquidity. The other secret is follow global M2. Why? Because global M2 money supply is closely correlated with what global assets do.

The most prominent being Bitcoin. Bitcoin is distributed as the internet. It's basically everywhere already, even though it's not a great medium exchange yet. It's a fantastic store of value. Bitcoin tends to rise and fall based on what Global M2 is doing. Global M2, it has many factors and there are lots of nuances for how to calculate this. I always tell people if you want to have the very best work on that, go follow a guy named Michael Howell from Cross Border Capital.

on Twitter, he puts out the best work on that. And I have sort of the poor man's version that I follow of that, just to be clear. But as global M2 tends to rise, that tends to mean that what's happening is the global economy is doing well and banks are lending and they're expanding the global monetary supply. In contra distinction, when that is falling and banks are starting to clamp down and they're not making loans and loans are getting destroyed and people are going bankrupt and all that kind of stuff, global M2 decreases.

that tends to mean global assets tend to follow that same course, like Bitcoin, like gold, and then like, which most people don't think about, but US technology stocks, the mega cap tech stocks, the Amazon, Apple's, the Fangs, as people think of them, or Magma, or however you want to think about it, Microsoft, those stocks, they are global assets. And so lots of people around the world invest in these companies, and that's sort of a surrogate global asset as well. They rise and fall with global M2. So what is global M2 doing? It's...

It's been in a three year band of chopping sideways, interestingly. And it is also at the very top of it right now. It keeps trying to poke through and start a new uptrend when it does. And then people always ask me, when are you going to turn bullish? You know, are you Dr. Bull? I literally get that question 10 times every single day. Um, and I say the same answer every single time.

It's when that breaks higher when global M2 starts to finally trend higher again that will mean that the global economy has found its footing again and And banks are starting to lend again global M2 is expanding. I will turn into dr. Bull at that point We're not there yet. I know the Bitcoin price is rising. That's fantastic I feel I still think it's actually within normal limits of its range and we can talk about that if you want but

Until that breaks free. I just have kind of tempered expectations. This has been a great run for Bitcoin I'm really happy for all of us who have been in Bitcoin for four years and are finally seeing some redemption and you know validity But we haven't even started the bull market yet. This is still the pregame warm-up This is normal price action. I still think a couple things I'll just I'll just segue into this regarding Bitcoin because I'm nearing the end of my time, too

Usually what happens is and it's not always and we've only have a couple cycles to look at but we tend to have a lot Of height building up into the halving and then there's usually a letdown after that So I would not be surprised whatever the price of Bitcoin is it having I have my price range target, which is unchanged 62,500 at the low end up to seventy five thousand. It's still sitting in that range. I hope I'm wrong There's a lot of people are saying we're gonna hit a hundred. I hope they're right, right? I don't think they're gonna be but that's just

based on the models I look at. After the halving, don't be surprised if we get a letdown. That's very typical for that to happen. And so a lot of people think they're gonna be saying it's going to the moon, you're stupid, if you don't think so, mortgage your house today and get a HELOC and put all your money in Bitcoin. I think they're gonna be disappointed. I think it's possible that we see a significant drop of Bitcoin into the 40 or 50 thousands after halving in the summer.

I keep telling people, and this is sort of a joke, but just so people have something to work with because they always want predictions. I think the bull market starts in earnest on Michael Jackson's birthday, and I'll let people Google that to find out when that is. It's late summer. And then things get exciting. I think then we're going to see global M2 backing. Then I will start telling people I'm Dr. Bull again. Then we're going to have global M2 backing and supporting and acting as a tailwind to the price of Bitcoin.

then things get exciting. So as we head into the fourth quarter of this year and into 2025, I think we're definitely going to be above six digits. I could be wrong just to guess, not individual investment advice. But I think it's going to be well above 100,000. And I think we're going to go much higher as 2025 drags on. So I'm very much looking forward to what's coming, even though it's been fun so far. The game hasn't even started yet. So kind of buckle up for what's next.

It's beautiful. I know we have a few minutes left here. I got like two more quick things. Next time I'm going to send you because I have a few things we're not going to get to today, but we'll save them for next time. Maybe the next few months, I'm going to send you a pack of the Bitcoin trading cards and have one have you rip it live on here and see if you pull like a 21 club or something like that. And then we can sell it for sets. You can you can trade it in, sell it for sets because they're getting really collectible and people are just going nuts over. So we have to do that next time.

And then my question is, what is your card? Because I know we talked about this months ago. At some point, we've got you on your list. You're gonna be in the cards. Is it gonna be, what are you gonna look like? Is it gonna be a bull crab, just a bull What is it? It's gonna be Dr. riding a bull, I don't know.

Doc

That's the problem. That's the problem is that I change with the conditions, right? And so I'm really pragmatic. I'm not dogmatic. Even I'm dogmatic about Bitcoin being better money for a better world and that it's going to go up forever. But it goes in cycles, right? I was very unpopular in 2020. I had lots of people cancel me. I had threats. People hated me.

When I was like, I think the price is going to go lower, not only a little lower. I think it's going to go a lot lower. You guys, I still remember this is back in 2022 in like April and the price was in the 40,000s and I was on a toxic happy hour telling people, I think it could fall on half you guys, like based on what I'm looking at, we may see 20,000 Bitcoin and blah, blah. People were so angry with me, like calling me like, you can't be a bitcoiner. Like, how dare you say this? I'm like, I'm just telling you what I see. Right. And that's how I am. So.

I'm not, I'm never like a hundred percent bullish or crabbish or, or bearish whatever. So, uh, I dunno, somebody's going to have to get creative. Maybe that'll be part of a car design is that you incorporate all of those symbols and I'm somewhere in the middle of that or something. I that's way beyond my skills. I don't know, but, but I would have a, yeah, I would have a hard time being like, you know, being labeled as just one of these things forever. I certainly don't want to be labeled as Dr. Bear forever, even though people still call me that. So.

Ooh, ooh, I like that. Yeah, oh yeah, me too.

Right. I know moniker stuck for a while. We'll have to we'll talk to Aladdin and the artist and the team about that. I do I love that actually, like some type of like, spherical, like you said, the different things and stations you kind of move to over time. Alright, quick to two really quick things. I'm gonna do a quick word association new segment sponsored by Bitcoin trading cards. It's a little playoff of Sunday conversation with Caleb Presley actually. And then if anyone's seen that from Barstool Sports, but

Doc

Nice.

One quick little health thing really fast before we do that to finish up for a minute. What's something you see as a doc when you're treating human beings? What's one thing that you just see, like this pattern that kind of has been coming up for maybe 10 or 20 years now that you're seeing that's affecting human beings that you can .. Hey, this is my health advice for the day. Guys, I see this all the time. What is it?

Doc

Oh, wow. That's a big question. Well, for me, the most obvious is just nutrition, right? We have this fiat diet that people have been on and it became popular when I was a kid in the 80s to have artificial foods and eat the food of astronauts and drink Tang and instead of butter have margarine and all these and instead of eggs have egg whites because they're the healthy substitute. All these kinds of things, all this artificial processed food was not only accepted, but it was actually considered.

healthier. And so I've watched the effects of that throughout time. And there's not, it's, correlation is not causation, right? You got to be super careful with all this kind of stuff. But I think it's pretty clear by now that all of this processed food has had a serious negative effect on human health and watching Americans get more and more and more obese over the decades has been crazy, right? And as a guy, I used to do something called interventional radiology.

And the outcomes of surgeries and medical procedures are affected greatly by the health of the patient and the more obese the patient, the higher the risks of surgical complications, comorbidities we call them, and just morbidity and mortality in general so that you're going to die sooner, you're going to have a lot more complications, diabetes, hypertension, you know, risks of heart attack, risks of stroke, higher risks of cancer, all of those things.

I've watched those progress steadily over the last decades and I'm personally encouraged to see this huge movement going on among in popular culture where the pendulum is finally starting to swing back in the other direction where people like as a doctor, even you get canceled if you say somebody that if you say that being overweight is unhealthy, obese obesity is unhealthy. You get canceled. Do you have culture telling you you're a fat shamer, you're a terrible person? I'm like, I'm a doctor. I'm telling you, this is a factual evidence-based comment.

It is unhealthy to be overweight and be obese. And it starts with your diet, right? So, so coming full circle to your question, nutrition, right? And so getting back to the basics, right? Red meat is not unhealthy. Eggs are not unhealthy. Um, even the cholesterol levels that dark, that dog, you gotta be super careful with all this kind of stuff, but you know, I'm not giving medical advice here either.

But in general, what's interesting is there's studies that show what like ideal cholesterol levels are even though doctors shoot for the lowest possible cholesterol levels and everybody is on a statin right like a lipitor or something like that The lowest rates of morbidity and mortality are actually at higher Cholesterol rates than what everybody shoots for which is super interesting and these huge studies show that it's that you actually want to have A bit higher and I don't want to get in

I just have to be so careful with what I'm saying. I'm not telling people they're getting bad medical advice. Do your own research though. Do your own research, please. And consider that maybe, you know, science, science is meant to be a very humble endeavor. Most people think of science as this is the fact, this is what we know, and science is always evolving. There are theories that change as the evidence changes. This is why I was so disturbed by the whole COVID movement and all of the doctors that would get on TV.

They were claiming to have the truth when that wasn't the truth. And they were claiming you have to do this, and this to be safe and to be, you know, to protect others from you. Um, when it was just, they were just guessing and they were just making decisions based on their fear and based on political, um, uh, clout and other things. So anyways, I'm diving way too deep and we're going to get canceled just for these things. So.

Yeah. No. Yeah, I know. I know. We'll get we'll get canceled. Last minute. I know you and I we got to go in here. I want to do a quick lightning round word association before we leave new segment presented by Bitcoin Trading Cards. Word Association, Paul Krugman.

Doc

Fax machine.

US healthcare.

Doc

hurting in need of a hard reboot.

Satoshi Nakamoto.

Doc

Founder of Bitcoin, the man.

Jay Powell

Doc

Uh, doing an okay job for the unnecessary job title that he holds.

That's a whole other discussion.

I love that. Oh man, next time. CPI.

Doc

Annoyingly high for longer than most people expect.

the Vitalik Buterin.

Doc

Ethereum should be Bitcoin later two not its own separate base layer.

Jim Cramer.

Doc

Great contrarian indicator.

Debt Spiral

Doc

not as worrisome as most people like to think. I don't talk in terms of hyperbole. Most people do. It's not as it's going to go on for much longer than people assume.

Proof of work.

Doc

It, um, uh, that's a good one. It's the, it's the paradigm shift. It all depends on proof of work. And if it's not proof of work, it's not real.

Peter Schiff.

Doc

The gold salesman.

Integrity.

Doc

Super important.

Bitcoin trading cards.

Doc

A great idea.

Vailshire.

Doc

We're the segue between no coiners and the Bitcoin standard.

Love it. Doc, thank you so much for coming on today. You passed the test here at the end the word association. So getting certainly getting people a little uncomfortable. Absolutely love it. Where can people find you?

Doc

Sure, so I'm on Twitter or X all the time. My handle is at @VailshireCap. Don't forget the little I it's Va-il-shire-Cap And then if you want I'm a fund manager and I run RAs I'm not really looking for new clients, but if you're super interested you can reach out to me at info at Vailshire.com

Glad to have you on our team. That's for sure, Doc. Appreciate the time with us today.

Doc

Thanks for having me, Brandon. I love being on your show.

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