Over the last 12 months or so look at all the insanely bullish triggers we have seen now…
…Crypto etfs
…Strategic crypto reserve
…Crypto president
However we have retraced much of the $100k bitcoin pump and markets seem completely flat.
How come?
I believe Trump is doing this on purpose, he is attempting to rebalance inflation and interest rates through dumping the stock market, bold move but it will force the Fed to cut rates back down to around 0%, which is what he wants, along with that, inflation will come down because he will have created a deflationary event.
This will force everyone into treasuries along the way and help reset over extended markets (which the traditional stock market is).
Let’s bring in the tariffs piece now…
If we are going to stick with tariffs which is really just taxing consumption vs taxing existing, then I think what will happen is there will be a huge shake up in income tax if not removed all together. If it was me, I would wait till all this is already in motion and we are at the low interest rate part, then boom- make huge change to personal income tax. Because it doesn’t make sense to have both, you will choke out the economy really quick and again, I assume he/his team/people behind him all know that.
Trump wants to create a golden era (he has talked about this a lot), and I think this is how he does it. Even if this whole new restructuring only lasted a decade or two, it will create a level of prosperity not seen in a very long time. They have been taxing us on so much for so long, it would be a drop in the bucket for them to hit the brakes for a few decades even.
Trump recently posted something like “we are gonna be so rich its not even funny, you will see”.
Tariffs will also force more production to return to the US, it will force down the cost of groceries as well as farmers will focus more on domestic markets and we will stop a lot of the importing. Believe it or not Warren Buffett presented similar idea back in the 90s at one of Berkshires annual meetings ( it was mentioned in 96, but probably many others) to use tariffs as a lever to force down inflation and change the entire taxation model.
I knew this was going to be a rocky year, I have talked about this quite a bit in the community leading up to Trump taking office, he said they wanted to force the ship in a new direction and it seems they are doing just that. Its not all rainbows and I am seeing gaps already with members brought on, but the overall big picture seems the same so far 60 or so days in, so lets see!
I think leveraged trading is very high risk right now, probably better for most to just keep DCA’ing into core positions and waiting this all out, or if you’re already bagged up from much lower, just log off and come back in 12 months.
If you aren’t positioned then I think you will be getting some sweet positions for at least the next 2-4 year ride.
Ok bye
P.S. At some point I will start sharing the new community we built over the last 4 years, stay tuned