Bitcoin and Stocks Do NOT Care About A Government Shutdown

0:00Hello, everyone. Stocks, Bitcoin, and gold, they are all going much higher in the coming weeks. Your stimulus check from 2020, that thing just got a lot more valuable. And Ryan Dietrich's here. He's going to break down data that proves the bears are wrong and why the optimists are about to make a lot of money. We're live today from the desk of Anthony Pompliano.

0:27Before we get into today's show, I need your help. My goal is to get to 1 million subscribers on YouTube. We're making a lot of progress, but a lot of people think we can't get there. But with your help, we will. Right now, we have 27 ,674 subscribers. If you hit the subscribe button, we'll get one more. Hit it right now. Let's get into today's show. All right, ladies and gentlemen, the U.S. government shut down earlier this week, and market commentators, they were all predicting excruciating pain in financial markets. But here's the thing. The exact opposite has happened. Adam Kobisi points out that the market bottomed at the exact moment the government officially shut down.

1:01I mean, look at this chart. It couldn't be any clearer. There's a classic example of the rumor being much more important than the actual news. Buy the rumor, sell the news. Additionally, the market is essentially calling the government's bluff. No one, not you or me, believes that the government will actually stay closed. Everyone sees the situation for the performative drama that it actually is. A big reason that the market has shrugged off the shutdown news is because there's been so much momentum across public markets this year. Steve Depp writes that the S &P 500 ended September on a five-month winning streak.

1:32Congratulations to all of us. And it's also a new all-time high monthly close. This is the 21st time since 1950 that it's happened. And the index has never closed lower eight months from now. That guarantees nothing, but you can mute anyone that says the last five months are a sign of impending doom. Now, this significant momentum is being driven by AI-related stocks. Shouldn't surprise anybody. JP Morgan's Michael Sabellas explains that AI-related stocks have accounted for 75 % of S &P 500 returns, 80 % of earnings growth, and 90 % of capital spending, all since November of 2022 when ChatGPT launched.

2:07Now, there's no other way to say this. We are living through an AI revolution right now. Public market investors, they're big winners because of it. That's good for them. But not everyone's thrilled about the recent developments in the market. There's still bears out there. Shanaka Pereira believes something bigger is happening in the market. He claims that markets ripping higher into a shutdown is not strength. It's proof that the S &P 500 no longer trades on fundamentals, he says. Liquidity, passive flows, and option mechanics have replaced cash flow and earnings. This isn't history being made, it's price discovery being euthanized.

2:39But he's not the only one either. Famed investor Leon Cooperman went on CNBC yesterday, and he was much more blunt about his reservations. Cooperman literally recited a Buffett quote from 1999. He was in his bag going way back in history. The quote was, once a bull market gets underway and once you reach the point where everybody has made money, no matter what system he or she followed, a crowd is attracted into the game. And they're no longer responding to interest rates and profits, but simply to the fact that it seems a mistake to be out of stocks. So this concern from old Leon is rooted in the famous Buffett indicator.

3:12The Buffett indicator measures total market cap of public equities against GDP. That measurement is now at an all-time high and that's got people nervous. But hold on a second. I think the concern is completely overblown. Could stocks correct from their current valuations? Sure, of course. But the technology innovation related to AI, one, it's very real, and two, the impact is likely to play out over the next decade or so. Companies are producing more profits with less employees. They're becoming more efficient. New companies are being built at breathtaking speed. Some of these companies are doing 50, $100 million of revenue in the first few months.

3:45That was previously thought impossible. So this begs the question of what an investor's timeline is when they make an investment. If you're worried about capturing profits in the next few days, weeks, or months, well, I'm sorry to say, but you've got a lot more work to do than the investor who's looking to buy a great asset and hold it forever. But if we speak of great assets, Bitcoin and gold also are in the conversation. We've been discussing gold's recent rise at length. It appears that large banks are beginning to expand their enthusiasm to Bitcoin in addition to all the gold propaganda that they've been spreading in recent weeks.

4:15This morning, VanEck's Matthew Siegel pointed out recent commentary from JP Morgan, one of the biggest banks in the world. JP Morgan compared Bitcoin and gold, and they wrote that the steep rise in the gold price over the past month has made Bitcoin more attractive to investors relative to gold. It's all relative comparison. The market cap of Bitcoin,$2.3 trillion, currently would have to rise 42 % to a Bitcoin price of$165 ,000 if we wanted to match the vol-adjusted basis of gold. So$6 trillion of gold demand has gone into ETFs, bars, and coins. This mechanical exercise thus could imply significant upside for Bitcoin in the coming weeks and months.

4:53Now, as my friend PE operator said, it's amazing how they've changed their tune and I don't disagree. Stocks, Bitcoin, and gold, they're all doing well in 2025. Each asset has surged higher in response to the US government shutdown and I am willing to bet, quite literally in my portfolio, I'm willing to bet that each of these three assets will be higher in the coming years. The doomsday predictors are not only wrong, they're cherry picking data. They're trying to tell a story that scares people out of the market. Nothing could be more destructive to wealth than if you sell your financial assets and what are you gonna do?

5:24Go hold dollars and treasuries? Madness. Things in motion tend to stay in motion and financial assets have a lot of momentum right now. If you wanna try to call a market top, be my guest, genius. Just make sure you don't cry later if you get steamrolled. All right, I saw this stat and it blew my mind. Remember those stimulus checks we got back in 2020? $1 ,400, the government was handing it out like candy? Well, if you had taken that$1 ,400 and bought Bitcoin when you got the stimulus check, you'd now have over$21 ,000. So think about the difference here. When you got the stimulus check, you could have went and spent it on whatever you wanted, or you could have invested it.

6:00And that is ultimately the example of what's happening in society. We have a K-shaped economy. Investors are winning and consumers are losing, regardless of whether you think it's fair or not. The key is that you have to learn to be an investor. And the people who got the stimulus checks and refrained from consuming and instead became an investor, that$1 ,400 is over$21 ,000 today. That's taking stimulus money and turning it into Bitcoin hard asset. If you didn't do that, you're on the losing side of that trade. I'm very excited to have Carson Group's Ryan Dietrich back with us on the show today.

6:31If you think about the U.S. economy and financial markets, everyone's trying to understand. Are things overvalued or not? Stock market going up or is it going to go down? I don't know, but Ryan's got a lot of data that's going to unpack why he thinks optimists are about to make a lot of money. Here's my conversation with Ryan Dietrich. All right, Ryan, I think the first place to start is that September was up. We're in this like five month or so straight up market. People seem to still be pessimistic. How do you go and balance the fact that stocks continue to defy all of the pessimists? And should we expect that to continue going into 2026?

7:03Yeah, Anthony, thanks for having me back. And I think it's a beautiful thing for those of us that actually follow the data. I mean, it's unfortunate. So many people have been listening to these perma bears and telling you how bad it's been. Obviously, I've come on with you, and I know you've been pushing the other side of this. This is an opportunity. I mean, this is a global bull market. We can get in all the weeds of it. I'll kind of keep it high level. You know, I hear how this is 1929. The Wall Street Journal had an article like that a week ago. Some black swan managers thought, well, of course, a black swan manager saying it's 1929.

7:30That's what they do. And overvalued. You know, the S &P is up ballpark 14 % time we're doing this. when you look at where the growth is coming from, 9 % of that is earnings, about 1 % of that is dividends. So to say that this is all multiple expansion in some bubble, maybe you could argue some of the big tech names. I'm not saying bubble, but they feel a little pricey, but that's where the growth is coming from. Bottom line, this is a global bull market that's really being driven by earnings. And a lot of those earnings come in here in the US. And I think it's still a beautiful thing. It's still a bull market.

7:59So I've seen you talk about this a lot online. I think it's a very important point is stocks can go up for a couple of different reasons. You can have a cost of capital change. You can have multiple expansion. You can have just straight hysteria in the market or you can have earnings. And the fact that majority of the growth is being driven by that earnings growth, to me, feels like that is the healthiest thing that we could be seeing. And if people focus on that part of it, all of a sudden, not only does the performance of these stocks make sense, but it probably actually makes you even more bullish.

8:30And it's kind of like even the bulls may be underestimating what's happening right now. Well, wouldn't that be something if the bulls were? And one bullet point for that, you mentioned about five months in a row. I just updated the data. One year after a five-month win streak for the S &P 500, this goes back to 1950, happened 31 times. Okay, you had a five-month win streak. A year later, Anthony hired 29 of them. All right. I mean, that's just one stat I know. But when you hear things like that, this blast of momentum we're seeing, it's real. Right. And the things I really enjoy or like about the market, it is broadening out the Russell 2000 small caps, which have not been to the party for four years, just made new highs a week ago.

9:09You know, I mean, we're seeing the broadening out theme. There's a lot of things participating in 2023. As somebody manages billions of dollars, it was tough. You had to be overweight, large cap or you underperformed the 2023. A lot of people did. What we're seeing now that you don't just have to be in one group, there's a lot of groups that are participating, small caps, mid caps, I mean, all across the board. And again, it's being driven by earnings, which is a very beautiful thing. You know, one more positive, let's be positive today, right? When the S &P 500 hits an all-time high in September, like we obviously did, the fourth quarter is higher 20 out of 22 times.

9:42times when the S &P 500 is up 10 % or more going into the fourth quarter, like this year, the fourth quarter has been higher 14 of the last 15 times. If you just look at the last couple stats that I said, I mean, the fundamentals are good, sure, but just momentum is a beautiful thing. And there still is momentum to this market. I think it'd be driven for the right reasons, Anthony. It's funny. I wrote this morning and the title of the piece was things in motion tend to stay in motion. When you think of momentum, what are some of the things that you think people get wrong about it? Or how should an investor sitting at home think about stock market momentum?

10:16And when can they tell whether it's sustainable or not? Yeah. I mean, I think the beautiful thing about momentum, it does go a lot further than you think. I mean, the reality is we gained 20 % the last two years, the S &P 500. Carson Group committed this year saying we're probably going to gain mid-teens. We were saying that back when we were down 14 % for the year on April 8th. Now, trust me, that was like, whoa, that's way up there. Now, sure enough, here we are, and maybe we're going to have a little more upside. So I think it's important to kind of, again, look at the big picture. I like to look at advanced decline lines, how many stocks going up versus down.

10:45These give us clues for what you're talking about here. We're seeing various advanced decline lines breaking out, holding in tough around the globe here in the U.S. Those are positives. I also like to look at the credit markets, credit spreads, right? If there's a monster under the bed, in my opinion, the credit markets will see wider spreads to show something's wrong. In April, when we had that pretty much virtually bear market, credit spreads were not blowing out. Look at what junk bonds were doing. Look what high yield was doing. They were still up on the year back in early April. So again, if you follow what the markets are telling you, nobody knows when this thing is going to end.

11:16But the reality, Anthony, it's not over anytime soon, in our opinion. Now, a lot of the growth of earnings of stock market performance and of CapEx is coming from AI. I think there's a concern that AI has a bubble. And if AI has a bubble that is going to pop or crash, then that should lead to the entire market being pulled down. How do you guys think about AI specifically in relation to the rest of the market? Yeah, well, put it this way. We like large cap. So if you say you like large cap, you probably like large cap technology. And we have a slight overweight to technology and the money that we run for our advisors.

11:48So that right there tells you, I don't think we're in some big bubble. But the reality, again, is if you're worried about that pricey part of the market and maybe gets a little ahead of its skis here and there. I mean, it's crazy to think after DeepSeek, right? What was NVIDIA down, like 40 % or something? All those names came down a whole bunch back in February, March, and into April, and they've come back. So maybe you can have something else like that, but that's why you stay diversified. I don't come on with you. Obviously, crypto has done amazing, but gold's having its best year since 1979.

12:14You know, to have a diversified portfolio, we're not too crazy about bonds, but the Fed is in a cutting cycle, right? The last 22 times the Fed cut within 2 % of all-time high like they did a few weeks ago. Take a guess what I'm about to say. S &P 500 was higher. So the reality is if you're uncomfortable about the large cap tech leadership, you're worried about AI, we're not, by the way. I want to be clear, we're not. You can just move your portfolio around and find some other things that aren't quite as pricey. I mentioned small caps haven't made a new high for almost four years. Almost four years just did.

12:43Those are some nice areas too. I mean, there's a lot of momentum here. I think it's a broad market and that's something that should really keep investors happy, I think. Now, one of the things I appreciate about you is that you're an optimist, but I think you understand the pessimist argument. You may disagree with it, but you at least understand it. What do you think they are concerned about that has the most credibility? Are there certain data points that you point out and you say, hey, you know what? If there was some sort of market downturn, this would be the cause of it. I don't think that that's going to happen, but I understand where they're coming from.

13:13Yeah, I don't either. I mean, I tell you, what worried us maybe this time a month ago was potentially a Fed policy mistake. We're in the camp the Fed should have been cutting, okay? I mean, we said they should have been cutting back in January and February, And I understand tariffs happen, worry about inflation, but the inflation data that everybody's telling us how bad it's going to be is just not there. I mean, it's just not there. So the Fed should be cutting. It looks like they are. Maybe they get a little prickly. You know, 2018 is a perfect example where they didn't cut. The market wanted them to cut.

13:39And then we had a near bear market into, I guess, that was also, by the way, one of the last government shutdowns, which we're obviously right now, a near bear market into Christmas Eve. And then the Fed pivoted. So that's one that gets us. And I mean, you know, I already talked about evaluations on technology, on some other communication services. It is pricey. But again, that just means you don't go all in on that if you're a little uncomfortable there. I mean, I mean, you know, the reality I say like this or not. This is the yes, I am a market strategist, an RIA. We're about to cross 50 billion dollars.

14:08We've been extremely bullish relative to just about everybody else. We've done really well. What worries me is where we started this conversation. I travel the country. I talk to people. I never get asked, wow, it's really good out there. How high can this go? Everybody's worried about something. I get paid to worry. You get paid to worry. So I'm not minimizing what the monsters out there potentially. But what worries me is what I've been saying for a couple of years. This is a bull market that's going to keep going higher. It's being led by the right reasons. You want to be invested. You need to take advantage of this right now.

14:37And that's what worries me because so many people are still being pounded by how bad everything is. And you look around, it's like, I'm not saying it's great. But for investors, this has been one of the better years we've had in a long time because you got gold up, crypto up, bonds are doing okay, and the stock market's hitting new highs all over the place. It's funny. We have a board right outside of my office, and I wrote the other day, what if everything goes right? And it's a mentality that people usually don't think about. But I actually do believe that the old Bill Gates quote, you overestimate what can happen in one year and you underestimate what can happen in 10 years.

15:07If you apply that to AI, there are a lot of Monday morning quarterbacks sitting at home and they are questioning why Larry Ellison, Mark Zuckerberg, Jeff Bezos, Sundar, right? You just go through all of these different people. Why are they spending billions and billions and billions of dollars trying to be the winner in a category that so many people at home seem to question? Do you think that they know something you don't know possibly? And I think that comes back to this idea of if they're willing to spend billions. And Zuck said it recently kind of out loud. I'd rather lose billions trying to win than not go after the opportunity, which I thought was interesting.

15:47I was going to chime in and paraphrase. He said, like, I'd be willing to lose a couple hundred billion dollars to be wrong here because I don't think we're going to be wrong. I'm a couple hundred billion. We're talking some real money now. And he said the quiet part out loud on that one. And when you see something like that, how do you as a strategist, somebody talking to these RAs, start thinking about, okay, I think the number now for the hyperscalers is 60 % of their cash flow is being invested from a CapEx standpoint to go and actually build this stuff out. Is there a level where it gets worrisome or is it no, actually, you want to see your best companies investing in R &D and innovation and growth, and that actually is bullish for the future?

16:24Yeah, I like to see them investing. I mean, we like to see CapEx. Yes, you look at GDP this year, like 1 % of GDP this year has come from CapEx with AI. The consumer has been about 0.6 or 0.7 percent of GDP. As we know, normally the consumer is a lot more. We think the consumer is going to come back. You know, the interest rates coming lower. So we're there. But I love to see this this this investment that's going on. You know, I know you hear the thing about, well, there are 150 railroads in the 1850s, 1860s. That was obviously a big bubble. And then for a long time, those tracks just never got built.

16:55And they were there. Of course, you have all the fiber optic cables that are put in the ground this time, 25, 26 years ago. didn't use them for a while. Then we all started watching cat videos on YouTube and watching this watching this show on YouTube. And we were starting to use them again. So there might be a point where this gets a little over the top, but I just want to stress. That's why you don't go all in on large cap tech. At least we wouldn't. If someone wants to, you understand the risk, go ahead. But again, I mean, from 2000 to 2010, right, I'm not calling it a bubble. I'm not saying we're there.

17:22But if you look after the tech bubble, what happened? Small caps were up. The rest of the world was up. Emerging markets had a great year. Let's look at gold. I know crypto didn't exist back then, but it probably would have done OK, too. So that's why you can invest in different things. You don't have to go all in. But we still like to see all this confidence. I think it's a key word confidence. We're seeing some IPOs come back. We're starting to look at share buybacks. I mean, companies are buying back their shares. They don't have to do that. They're still comfortable. Insiders are still buying shares at all time highs.

17:49I mean, these are things that you tend to see that support, again, this bull market we're in. I have a standing rule that anytime a pessimist talks to me and they reference a time before electricity vehicles, or if you had to walk across town to talk to someone, then your data is just not good to me, right? I mean, we live in a very, very different world. You mentioned earlier gold. Gold obviously is the big story this year. People are very excited about the performance there. I think that there's two ways to look at it. On one hand, you have an asset that benefits from currency debasement. It's going higher.

18:20A lot of people have gold in their portfolio. They're very happy. But also, I think people kind of think of gold and Bitcoin to a degree as like a global alarm system. And if gold is rising this much, maybe it's actually signaling a negative event is coming. How do you guys look at it? Well, I get both sides of that argument. One of the things that we've been saying for years now, we added gold to our tactical models. I'm talking real money that we managed for our advisors back in April of 2023. And I was on record. I might have been one of the few people. And I got some looks when I said this, Anthony.

18:48We are probably going to enter a period for years where gold and the stock market go higher. Because everyone's like, what? That's not possible. Yes, it's possible. Go back and look in history. There have been a lot of years where those two things go higher together. I know we didn't have Bitcoin back in the early 2000s. But again, I think it makes sense to us. You see both things going higher, and it's justified. And one more thing on gold. Yeah, gold relative, dollar, sure. But what we're seeing this year, gold relative to every other currency is breaking out. That is a sign, again, that it's real.

19:19We know the central banks are buying. All that stuff started in 2022 when some of the sanctions came on Russia. I'm not going to get all political, but we know central banks are buying because they're not always looking around, not trusting everybody. What do you trust? Well, I guess you can trust. Maybe you could trust gold because that's where people are flocking. But again, I think it's up 44 % or so for the year. Let's be blunt. That's probably extended. Maybe it's due for a little break. But if this is the top in gold, and I want to be clear, I don't think it is. We just added some gold to our strategic models.

19:45maybe three months ago, that's thinking three to five years. So we're thinking three to five years. You want to have maybe, well, we've got about 3 % in gold. Maybe you want to have a little more, but we want some exposure to gold there. The reality, though, this would be the shortest bull market in history for gold. And most bull markets last a decade. This one, I guess I'd argue is about three years old. So just look at history. These things, once they get moving, they can keep moving. And I think it can keep going up along with the stock market. You know, what's interesting to me is Bitcoin obviously has been very explosive and asymmetric, But I was looking this morning, silver, steel, gold, all of them have been outperforming Bitcoin this year.

20:21And I wonder, is that a sign that, you know, hey, Bitcoin's going to catch up as it has done many times before, kind of gold runs 100 days later, Bitcoin catches up? Or are we actually seeing investors say, hey, this currency debasement thing is a real problem. I do need to go into hard assets, but maybe I'm not yet ready for something like Bitcoin as a digital hard asset. Instead, I'm going to go kind of to the staples that I've had in my portfolio for decades. Yeah. I mean, listen, you're the Bitcoin expert over me, but I will say I think it is some of that. I think people are looking around for other things to invest in.