Michael Saylor WARNING: Bitcoin Crash And Inflation Are Just The Beginning…
But ultimately, if youre, an investor and youre concerned about preserving your wealth, to give to your children or your grandchildren, then whenever youre in an inflationary environment, your your strategy is simple. I have to convert my weak currency into a strong currency, ideally convert my weak property into strong property, and i think one of the obvious things is digital property right. If i created a city in cyberspace with 21 million blocks – and nobody could make any more and it was going to last for a thousand years – and it was the dominant city and everyone wanted to live there, would you want to own one of those blocks? I think the answer is yeah and that city is called bitcoin, hey guys, welcome back to the channel. Today we have michael saylor on the money, gps podcast discussing the current bitcoin market. This comes at a time where the crypto market is mirroring the decline in the stock market, which is not surprising. The fear in the market is expected, especially after a recent hike by the u.s federal reserve, as well as the uncertainty with rising costs. Microstrategy ceo, michael saylor, remains bullish on bitcoin, despite the fear and greed index. Indicating instability across the board yesterday peaked at thirty two thousand five sixty one and dipped below thirty thousand four hundred. As of the recording of this video bitcoin is currently sitting at thirty. One thousand two fifteen, the least surprised by this – is sailor, but does indicate that inflation is still one issue.
He says that the central banks wont stop inflation because its caused by excessive money printing, if you enjoy the content, we do hear. Please hit that like button and subscribe to the channel lets, get right to the interview with michael saylor, giving us his take on the bitcoin market today. I think that if youre a short term macro trader, like youre thinking in terms of hours or days or even weeks, youre really concerned about that question. But i think that if you have a time frame of four to ten years, i think theres a different question, which is: why are the interest rates going up uh and what is the macroeconomic environment? And i would say i would say you probably shouldnt even buy bitcoin if youre uh, if your time horizon is less than four years, because youre a trader and if youre a trader youre, probably not going to care about anything. I have to say youre. Just looking at on whether its correlated or uncorrelated and and throwing lots of money around without thinking about it, i think, if youre, really a deep thinker or a macroeconomic investor, the bigger issue is, we have monetary inflation, the money supply or the currency supply is expanding. I think the news today in turkey was 70 percent inflation in turkish lira. We probably got something in the range of 15 to 20 percent currency inflation in the u.s dollar in the euro. Weve got 40 percent inflation in like an argentine peso or more so.
What you have is an inflationary environment. We know the cpi, which is which is a which is a uh, manipulated measure of inflation, its actually the lowest inflation that one could reasonably measure. I think its like seven and a half percent six and a half seven. Eight percent in the us and europe – and these are 40 year highs. Sailor goes on to say that one of the ways they tackle inflation is to raise interest rates, but that the actual inflation rate that they wont tell you is two to three times the reported number. There are a number of factors in addition to the money printing thats, causing the spike to happen. Sailor discusses some of these reasons and why currencies are collapsing in value, so the cpi is eight percent, but that, but the actual asset inflation rate is double to triple that. So the reason that interest rates are going up is because theres pressure on the central banks to get inflation under control and and their one tool to do it is to raise interest rates. But theyre not going to stop the inflation, because the inflation is caused by excessive money, printing budget deficits and the wars and political policies, domestic and foreign policies. And these policies continue. Given the fact that we have uh an expansive currency environment and what you can see is the price of food and energy and scarce resources keeps going up. The question really is: if i have some money, what should i invest in and the answer is you dont want a whole currency because the currency is collapsing in value.
You know the the us dollars lost 99.7 percent of its value. Over 90 years i mean and thats the winner. The losers are are losing 99.9 of their value over 100 years, so the currencies are all collapsing. So i i dont want to hold the currency. I dont want to hold bonds because bonds are currency derivatives. You know you know im going to basically youre going to give me a million dollars and im going to give you interest on the million dollars at 3 percent for 30 years and ill give you the million dollars back and in 30 years the dollars will buy. 10 percent of what they buy right now so thats even worse, michael saylor is not only a firm believer in time horizon, but that directly plays into the long term holdings that many investors are currently contemplating its, not just crypto markets that are feeling the burn. Right now, its stocks across the board sailor believes that even inflation wont stop the collapsing currencies, but it could definitely affect short term trading in the crypto market. You dont want to hold a value stock that generates valued on cash flows, because if the stock is valued on cash flows without growth, it looks just like a bond right. It might be slightly better than a bond, but if you, if the currency is losing 10 of its value a year and you cant raise your cash flows or raise your prices, you have to increase your cash flows 10 a year to offset a 10 percent currency Collapse right so when the currency is collapsing at 70 percent a year like turkey, the company you own has to raise its prices in turkish lira 70, or you have to you, have to raise your your prices by an amount such that your cash flows would increase By 70 percent, so that you hold parity in value, so equities are currency derivatives, partial currency derivatives, bonds are almost complete currency derivatives.
Commercial real estate is a partial currency derivative. The currency is currency derivative right, its a full currency derivative. So what do i own and the answer is i want to own scarce property, scarce desirable property? What is it that you own, that an affluent intelligent person will want to buy from you in a decade thats the question you have to ask yourself so, if youre owning things that will last a decade right, i mean, if you buy a car thats not going To last a decade, its not really an asset, its depreciating one of the strategies sailor suggests is, if youre in an inflationary environment, to convert weak property into strong property, but its not as easy as moving out of the country. Those countries could just as well devalue that currency and youll take a significant loss thats. Why saylor says that bitcoin is the greatest asset in human history because of the value it holds, but maybe on a sports team or a picasso painting i dont, know well: well people want to buy gold from you in a decade. Will they want to own uh? The building that you own in a decade right: well, they want to own the intellectual property rights. Well, it all depends. Uh bitcoin is scarce, desirable asset because it represents digital property and that strong property. I want to move out of the country. I want to move it out of the jurisdiction of a politician that may confiscate it or tax it away right and that thats, why you know converting a million pesos, a million dollars of pesos into a million dollars of dollars and bonus errors wont help you because Eventually, the politicians will freeze your bank accounts, convert it back into pesos and devalue it twenty to one that wont, help right, converting a million dollars of pesos in the million dollars of dollars and then buying a million dollars worth of big tech stocks in the us.
May be a better idea if the big tech stocks are monopolies theyll be able to raise their prices, hold their cash flows in whole value. Monopolies will be fine right. What is a monopoly, its scarce desirable property, if i offered you a monopoly with unfettered ability to change the price of something that, like oxygen, sell oxygen to new york city? You know youre probably going to do. Okay, while being the biggest bitcoin holder among publicly traded companies has its risks. Sailor believes microstrategy could survive a serious bear market sailor tweeted yesterday microstrategy has a 205 million dollar term loan and needs to maintain 410 million dollars as collateral microstrategy has one hundred and fifteen thousand one hundred and nine bitcoin that it can pledge if the price of Btc falls below three thousand five hundred and sixty two dollars the company could post some other collateral. Sailor appears confident for a worst case scenario. The problem with with even monopolies, though, is over time. Monopolies get regulated right like like in theory, the richest person ought to be the person that sells water in new york city, but theyre, not the richest person, because the new yorkers get together and they decide that they dont want the water company to raise the price Of water to a hundred dollars a gallon, even though youd pay it if youre thirsty. So what can i buy thats going to hold its value over time? That represents scarce desirable property, not just scarce, because theres, a lot of things that are scarce, that arent desirable right, scarce, desirable property, and i think one of the obvious things is digital property right.
If i created a city in cyberspace with 21 million blocks – and nobody could make any more and it was going to last for a thousand years – and it was the dominant city and everyone wanted to live there, would you want to own one of those blocks? I think the answer is yeah and that city is called bitcoin. Well, definitely be keeping an eye on this comment down below on what you think of michael saylors position. Dont forget to like and subscribe. This is library of wealth.