Liquidity Is Coming! And It Will SEND Stocks and Bitcoin SOARING

0:28Hello, everyone. We've got a lot to discuss today. subscribers on YouTube, but we're only at 22 ,356. That's where you come in. Hit that subscribe button and let's get into it today. All right, ladies and gentlemen, things are about to get very crazy across financial markets. Now, I know there are plenty of people that are still predicting a recession is right around the corner, but they're simply wrong. I don't know what these people are talking about. I'm not sure if they're looking at bad data, if they're drawing bad conclusions from good data, or there's some combination of the two, but it doesn't really matter how they're arriving at the wrong conclusion.

0:57They're just flat out wrong. Take the U.S. stock market as one data point. Adam Kobisi writes that the stock market is incredibly hot. I don't disagree with him. Since 1975, there have only been six times where the S &P 500 rose 30 % or more in five months. 2025 is one of those times. In 100 % of these cases, the S &P 500 has ended higher in the following six and 12 months per Carson Research. In fact, during such occurrences, the S &P 500 has rallied by an average of 18 % in the following 12 months. That's pretty good. Those are insane numbers. So you want to bet against history? Be my guest.

1:34I like to think of financial markets similar to science, though. Things in motion tend to stay in motion, and momentum is one powerful force. But this is where things get interesting. If the stock market is growing by 30 % in five months, there's got to be someone who's getting richer, right? Who the heck is holding all this stock? Well, Adam goes on to explain that newly released data shows that U.S. household net worth jumped by$7 trillion in Q2 of this year alone. In other words, for three straight months, U.S. households added an average of$79 billion in net worth every day. As a result, the rich are getting much richer.

2:07Now, currently, the bottom 50 % of U.S. households, they hold just 2.5 % of total U.S. wealth. In fact, the top 1 % now holds$40 trillion more wealth than the bottom 50 % combined. So let's just recap this situation for a second. The stock market just drove historic returns over the last five months. It made rich people even richer while the bottom 50 % of Americans were left sitting on the sidelines. Now, that isn't the rich people's fault. It's a financial education problem. Stop blaming the rich people. In fact, I would argue that we have a national crisis in this country until we figure out how the heck do we educate every student on personal finance and investing?

2:43Educate them and they can get rich too. Asset owners are gonna be winners and savers will be losers moving forward. You may not like it, but it doesn't make it untrue. This bull market is not even close to over either. Mike Zaccardi writes that the average bull market lasts 70 months, 7-0. We're only about to complete month 35 of this one. Well, that's a narrative violation, right? And I know your pessimist neighbor, they ain't going to tell you that data. But data is data. And almost all of that points to the fact that we are in a bull market that has plenty of legs left. This brings us to the Federal Reserve meeting this week.

3:15And that should culminate in interest rate cut. Yes, they are going to cut rates with the stock market at all-time highs. and the government inflation data measuring above 2.9%. We have never seen this situation before. Creative Planning's Charlie Blolo points out that the last time the Fed cut interest rates with inflation over 2.9%, well, that was back in October of 2008, and it was in the midst of the worst recession and bear market since the Great Depression. Now, I personally have two big conclusions from this unprecedented move. First, the Fed is going to do this because of the labor market.

3:49Artificial intelligence has been a massive deflationary force in the U.S. economy. Companies are figuring out how to be more productive and more profitable, but to do it with fewer employees. That's good for business. But second, the Federal Reserve has been behind the curve for months. I don't know what these people are doing. I believe the Fed should make a 50 to 75 basis point cut in interest rates, and that would allow them to catch up to where they should be. But history tells us that the Fed is going to avoid being bold in their decision. But don't take my word for it. Jordy Visser explained to me this weekend why he sees the odds of a 50 basis point cut increase it.

4:20Take a listen. The Fed should be cutting rates, and I think they have been slow to doing it. I think they're going to pick up the pace. And I think if anything, with the data we saw this week, more and more people are open to the conversation of them doing 50. I still don't think it's going to happen, but we are, you know, we are getting higher and higher on the possibility. I'm sticking with 50. There you go. I think they should do 100, but they're i told you remember we talked about two three weeks ago right i said this is crazy just get to where you need to be now i understand the market won't like it etc but yeah 50 to me 50 is your serious 25 means you're getting pulled kicking and screaming i don't think the market will care as much as it would have two weeks ago if they did 100 it no no 100 would okay yeah that's Yeah, I think the market actually a part of the market wants 50.

5:15You shove a bunch of academics in a room. They're not going to come out and say we were wrong when they do 50. I do believe there's a political side to this. I do think there's going to be enough discussion. There might even be dissents of people that think 50 are in there because if you're leaning towards the labor market, there's no way to look at the labor market and think that it is good. There's no way to say the labor market is good. You got the revisions, but more importantly, you've now had, you know, June, July, August. You just don't have good data sitting there. And so wages are still coming down slowly.

5:50I believe everything is fine in the economy. But if I'm if I'm sitting in there and I want to impress the administration to see if I can be the Fed chair, I think there'll be some 50 cents. I think Jordy's got a point there, but let's just level set for a second. Polymarket odds are only 8 % for a 50 basis point cut. That's very low compared to the 90 % odds for a 25 basis point cut this week. But it's not ultimately gonna matter. It doesn't matter whether they do 25, 50, or 75 basis points cut. Carson Group's Ryan Dietrich writes, the Fed's last cut was in December of 2024. That's nine months between cuts.

6:26Waiting five to 12 months between cuts tends to be bullish for the S &P 500. Higher a year later, 10 out of 11 times with above average returns, and that should have the bulls smiling. The Fed is gonna push asset prices from stocks to gold to Bitcoin to much higher levels. They can't help themselves. They have to address the labor market issues or they are going to have a much bigger problem on their hands. Put aside the fact that the government's data misled the Fed into believing inflation was much higher than they thought it actually was. Ignore the fact that the Fed has become a politicized organization that seems to be cheering against the current administration's economic plans.

7:00And you know what? you should also refrain from getting worked up about the Fed's flip-bopping about being data-dependent. The Central Bank of the United States is now backed into a corner. They have to cut interest rates. Given asset prices are near all-time highs, we can only expect the newfound cheap capital coming into the market to push prices higher and higher in the coming weeks and months. So ladies and gentlemen, get your rain boots on. Liquidity is coming, and I think investors are going to be very happy. Here we go. Elon Musk just purchased a billion dollars in Tesla stock on Friday.

7:32This level of conviction is nearly unheard of in financial markets. Most executives are constantly looking to extract value, but the beauty of capitalism is that Elon's financial decision on Friday, that's going to align him with shareholders. Elon wants to see the Tesla stock price go up. Duh, he owns a lot of it. You can see it in his billion dollar stock purchase in the open market on Friday, but you can also see it in his new pay package that would pay him up to$1 trillion with a T if he can hit nearly impossible and aggressive milestones for the company. Now, I believe that we are going to see many more compensation packages that directly align executives with shareholders.

8:06Perform and you get paid. Don't perform and you don't get paid. It's really that simple. Imagine if every public company CEO was only compensated if their company performed and if their company actually created wealth for shareholders. You think companies would be run differently? Do you think there would be more lean, profitable companies in the market? Well, I don't know, but I think so. That's how incentives work. And Elon is just the latest example. Game, set, match. The tariff fear mongering is over. It's outlawed. You aren't allowed to spread that nonsense noise anymore. At least that is what Jordy Visser explained to me during our conversation this weekend.

8:42Take a listen to Jordy's logic. I think all of the bearish sentiment that's been sitting out there where people refuse to stop with the tariffs because that's what the CPI is. It's I'm worried that tariffs are still going to show up somewhere. I think this was the official ending of tariffs this week. All right. So you say it's the official ending of tariff, like fear mongering. I saw a lot of people say, oh, inflation is now 2.9 % year over year. The tariffs are here. They're infiltrating into the inflation numbers. Look at, and they would go and they would find some data point. They'd be like, I told you the tariffs are inflationary.

9:18Look at this thing here. And by the way, these aren't like trolls on the internet. These are like well-respected economists and actually people that like we talk to on a weekly or every other week basis. I'm shocked at how many people are like, hey, inflation is here. Inflation is being driven by the tariffs and we should all be concerned. So here's the beauty of those economists. Their job, if they're at Goldman Sachs, Morgan Stanley, is to try and help investors make money. None of that is going to help investors make money. If anything, it's helping them lose money or underachieving. It is the reason why I spend all of the time that I do on AI.

10:00It's the reason that you and I basically got together because I believe AI is the gateway to crypto. Economists don't know anything about AI or crypto. Nothing. So what happened in Oracle, I mean, just to put this in economist terms, which no one put out this week, Oracle had an increase in orders of$317 billion. OK. Is that a lot? That's a lot. To put it into context of economist terms, nominal GDP in the U.S. is, let's say, four and a half percent. At four and a half percent on a$30 trillion economy, you're talking about, let's say 325 billion a quarter increase. So Oracle in three months, their back orders grew by$300 billion.

10:49So what's more important right now than what's happening with artificial intelligence? And that's just the infrastructure side. That doesn't include the profit margin side. It doesn't include the adoption side. It doesn't include any of the other things that are going on. This is literally one of the largest companies in the world saying, we don't have enough capacity for the orders that are hitting us. Economists don't talk about that. They're still fixated on whether core goods services moved up. And I'm not kidding you. It gets rounded to where the big, let's say scary part today was, well, it came out at 0.346.

11:28If it had come in at 0.351, we would have rounded it up to 0.4. That's the stupidity that gets in for people thinking that is going to help you make money or not. Now, there's plenty of people who disagree with Jordy's views, but the data is fairly compelling. We were promised a recession, a Great Depression, empty shelves at the store, and some people even told us the world was going to end. No, literally, go search on X. They were saying that. None of that happened, though. The tariffs have been around for months, and so now the fear-mongering trolls have been banished back under their bridge to screech about the next doomsday prediction.

11:59Good luck to them. The rest of us are going to be too busy living in the real world. That's it for today's show. Thank you so much for watching. Please remember, we have 22 ,365 subscribers, but I want to get to a million. So I need your help. Please make sure that you hit the subscribe button and we'll see you guys live tomorrow from the desk of Anthony Pompliano.