Kingsview CIO Scott Martin discusses gold’s recent performance, plus the rise of cryptocurrency and its potential volatility.
Program: Making Money with Charles Payne
Station: Fox Business News
CHARLES PAYNE: So all the record books say that it was the month of October, twenty twenty one when the Crown was officially passed to bitcoin and crypto from gold and silver. Now, according to J.P. Morgan, there right now three main drivers for bitcoin’s remarkable October to remember. So I want to get the read from Scott Martin and Meltem Demirors and Scott. Let me go to you, my man, because apparently institutions now see bitcoin as a better inflation hedge than gold. You’ve championed gold on this show for a long time. Is it time to throw in the towel?
SCOTT MARTIN: I have Charles, and I’m holding back tears doing this, but I’m good at doing that, so I won’t cry. I promised myself I would cry. We sold the gold today. I can’t believe it, and that was based on several factors, not because of what some of these institutions are doing, because those are not the guys to follow. In my opinion, as an independent adviser and one that manages ETFs and such. But the reality is this Charles, because of some recent data and certainly the performance of our friend Jld and some of the other ETFs that are out there in the gold space, it just hasn’t been there. As far as the non correlation in some of the upside capture. So while I don’t think that answer is as is the bitcoins or the theorems or the Solana’s, the reality is gold is just not handling itself very well as that alternative asset space in our portfolios right now. So I just think gold is not the thing to hold right now. I don’t think some of the bitcoin stuff is right, either, if that’s what you’re looking to replace it with.
PAYNE: OK, so Milton, Meltem, in the meantime, institutional investors are rushing in like gangbusters venture capitalists. I read where Mark Andresen shopped. The funding has gone through the roof from hundreds of millions to billions. So at least are the credibility questions over right now. Do you feel like as someone who’s championed this space, you took a lot of slings and arrows from these famous international types that you can finally say, OK, don’t question that credibility anymore?
MELTEM DEMIRORIS: Yeah, look, Scott, I’ll take the W all day. I’m sorry, but I’ll take the W. I think we are definitely at the point one percent of global aum across all asset classes is now in crypto. Of that, 50 percent is bitcoin and 50 percent is everything else. Crypto is here. 20 percent of Americans own bitcoin. This is no longer a fringe asset class. This is a diverse asset category that has publicly listed equities, including my company CoinShares. We have ETFs with exposure to equity. We’ve ETPs with exposure to digital assets themselves. We have the coin, so we have venture funds, we have SPACs. It is a growing and really robust category and I’m really excited about the opportunity ahead. We see a lot of opportunity for growth. And as we like to say in the industry, Q4 is the start of the madness. We’re calling it up tober, by the way, Charles. So this is not October, it’s uOtober.
SCOTT MARTIN: Just be ready for the volatility.
DEMIRORS: Hey, that’s the price of opportunity- price of opportunities, the volatility,
MARTIN: But different from alternatives of yesteryear, in my opinion, but no problem.
PAYNE: All right, so, so real quick, then I’m going to come back to you, Scott, but I do want to squeeze in with Meltem. The NFT is worthy. They stand there also having a pretty strong month there up Tobar as well.
DEMIRORS: Yes. I mean, yeah, I’ll talk about NFT’s, so yeah. Look, I think, you know, people love buying luxury goods. LVMH with a $400 billion company and they produce artificial scarcity, right? People buy handbags, people buy expensive cars, watches and have to use our digital flex right. For people like me, I spend all of my time on my laptop. I don’t need Chanel bags. I need digital flex. And so I think NFT is in many ways are filling this interesting new niche as we enter the so-called metaverse as we live increasingly online. We need different ways to sort of flex online. Right now, NFTs are very much focused on art and sort of displaying our unique clothes. We’re also calling them IS or profile photo NFTs, but are also seeing games using NFTs, luxury brands using NFTs. And I think it’s still a really early space, but want again where there’s tremendous growth for multiple different types of opportunities, whether it’s new brands, legacy brands, lot of space.
PAYNE: Let me only go. Got 30 seconds. I’m going to give Scott the last word, Scott. She mentioned the metaverse. You know, flossing on the metaverse. It sounds like you and me are going to be stuck outside the metaverse fishing. I mean, you’re going to jump at any of that stuff. Maybe some of these equity is riot, MHRA, Coinbase. Anyways, you’re going to get exposure to this space.
MARTIN: Yeah, we have some clients that have some of the riot, some of the DLC blockchain, and I think those are those are good if that’s the exposure you want. I also agree with Meltem, though you need exposure to the coins through Coinbase. You can actually trade the exact coins. And one quick point on the NFT, you can’t bring it in in stores and steal them, Gucci and all those. At least they’re unpreventable that way.
PAYNE: We got to leave it there. I’m handing it over to Lauren Simonetti Lauren to see.
Kingsview CIO Scott Martin discusses the current US economy as it pertains to debt, spending, and small business.
Program: Mornings with Maria
Station: Fox Business News
MARIA BARTIROMO: Investors watching your money. Joining me right now is Kingsview, Wealth Management Chief Investment Officer and Fox News contributor Scottie Martin, Bulltick Capital Markets Chief Strategist Kathryn Rooney. Vera and Michael Lee, Strategy founder Michael Lee. Great to see everybody this morning. Thank you so much for joining me on a beautiful Monday morning. Scott, kicking it off with you. Got a mixed story this morning, but we’re watching inflation. We’ve got inflation data later on in the week. We’re getting the May Consumer Price Index on Thursday. How do you feel about markets today? We’re still not far away from record highs, although technology has certainly been rolling over. Assess the markets from your standpoint.
SCOTT MARTIN: Yeah, I feel a little less than fabulous today, and it’s not just because it’s Monday, we’ve got a big week ahead, as you mentioned, Maria, it’s the fact that folks from the administration and the administration itself seem to just be blowing it when it comes to policy and outlook here. I mean, Janet Yellen, as you’ve talked about most of the morning here, Maria is talking about higher interest rates being a plus for the US economy as we drive up debt, as we go crazy with spending, as businesses need to lend to to fund their operations, to get back on their feet and the administration blowing it from a domestic and global policy as well. I think we have a lot of risks here, as you’ve been speaking with several guests this morning about how things pan out with respect to inflation, spending growth and frankly, interference, Maria, that the administration is running on mom and pop America who are just trying to get back on their feet and get back to be part of the economy that we have ahead of us.
BARTIROMO: So we know that President Biden does not have support for this package, Scott, he would like to get it all through through reconciliation. He wants to spend another five trillion dollars and he wants to raise taxes by the highest tax increases that we’ve seen in a generation. But again, he doesn’t have the support. If we were to see higher taxes, does that impact stock market negatively later on in the year?
MARTIN: Of course. And I think you’re right about the number. I mean, the numbers a moon shot right now. I mean, with respect to what we’re seeing in Congress, what we’ve seen from Joe Manchin over the weekend, it’s a moon shot. I mean, that’s a big number. But the reality is this administration starts high, they start histrionic, and then they chop it down and say, hey, we’re making a deal with you when in reality the deal was a bad deal to begin with. So that’s the tactic. That’s what I’m worried about. And I think markets will be eventually to.
BARTIROMO: Yeah, I mean, markets are treading carefully here, Catherine, we’ve got news just over the last week of this beginning of selling some assets on the Fed’s balance sheet. Now, they say that’s not tapering, but they’ve already announced that they’re going to start selling some assets that they accumulated on the balance sheet during the 20 20 pandemic. And then you’ve got the infrastructure spending package. The federal part of this, President Biden set to meet with West Virginia Senator Shelley Moore Capito later today. He’s got this last ditch effort to strike a bipartisan deal on this massive spending bill. What’s priced into the market? How do you see all of this playing out, whether it’s the spending bill that he’s trying to jam through reconciliation, which is not happening because of the Democrat lack of support or the Federal Reserve beginning this campaign sort of tiptoeing in to the tapering.
KATHRYN ROONEY VERA: Yeah, well, thank goodness, hallelujah, they’ve started to even talk about tapering, remember Maria and the audience, it’s important to remember that the corporate bond position is very, very small. So that was that was a very unusual and unprecedented way to go about quantitative easing. So they’re going to start to roll off some of those corporate bond holdings. The biggest companies, I mean, we’re talking Apple, Daimler Chrysler Anheuser-Busch. These were effectively being subsidized by the federal government. The question I ask myself, Marie, is why this insatiable thirst by the federal government to increase spending? We had six trillion dollars approved by the by Congress for covid. We have two point three trillion dollars remaining from those funds. This is data from the bipartisan committee for a responsible federal government. So why not use some of those funds instead of talking about increasing taxes? You know, not even if they can get infrastructure done. We don’t have the raw materials or the human or the manpower to do so. If the federal government were to slowly or maybe very quickly get rid of the emergency measures that are no longer needed because we’re out of the emergency effectively, then maybe we’ll have a chance of getting those construction workers to build those roads and bridges. But even as of right now, we have the money. It’s in the covid funds. We don’t need to keep paying unemployment benefits that are keeping guys and gals on the sidelines and this inexhaustible, I think, interest in indebting exponentially. The United States government is very concerning. The markets tend to your question, Maria, are completely pricing in a continuation of both monetary and fiscal policy. That’s probably right. But once we do get that big surge in inflation, interest rates are going to go have to go higher and the party’s over. So I think that investors have to be concerned. I’ve talked about inflation for some time now and they have to protect their portfolios with inflation protected instruments.
BARTIROMO: Well, I think you make a great point, Kathryn. You’re right. I mean, it’s more of an ideology. This administration wants to have a green economy, and that requires an incredible amount of spending and a change of the structural foundation of this economy. It’s going to mean incredibly higher fees and regulatory cost for for businesses as well. And the economy’s growing. I mean, we’ve got expectations of up to nine percent growth for the GDP in twenty twenty one without all of this spending. So just leave it alone. And what you mentioned about debt. You heard what Kevin what Jason Smith, the ranking member on the Budget Committee, told me yesterday in the 10th year of President Biden’s budget, we’re going to spend more on interest on the debt that we spend, all on our defense. We spend more than 700 billion on defense. The debt the debt interest is nine hundred and fourteen billion dollars in year 10 Kathryn.
ROONEY-VERA: That’s right, and look, even Social Security, we know that that’s a black box and that’s a Ponzi scheme, really effectively interest payments very soon and even before then, Maria, are going to exceed the amount that we owe for Social Security. So it’s very concerning. It’s completely unsustainable. And there’s only a certain period of time for which you can grow debt exponentially more than you’re actually growing the nominal GDP of the US economy.
BARTIROMO: Yeah, I’d say and Michael, we know that these rock bottom rates and this Federal Reserve stimulus has pushed investors to go out on the risk curve. Look at crypto Bitcoin is trading up this morning. It had a rough day, certainly over the weekend. It fell after Chinese social media platform Weibo suspended several crypto related pages. Goldman Sachs is also noting the ongoing hesitancy for crypto adoption. Michael, your thoughts on where we are on Bitcoin and the crypto market?
MICHAEL LEE: Look, as long as there’s money printing worldwide, Bitcoin and crypto aren’t going anywhere, you got a little bit of negative sentiment out of Goldman Sachs CIO survey saying that the CIOs they’re talking to said that crypto is their least favorite trade. However, just a couple of months ago, Bank of America did a similar survey and said that Bitcoin was the most crowded trade. We’re not going anywhere. Where Bitcoin is in kind of the middle of 30 thousands is typical of the pullbacks you’ve seen historically in the asset. I expect volatility continue, but I think all time new highs for Bitcoin are a long way from here. I don’t know if that’s this year or next year, but I think if you’re a believer in the asset as I am, you’d be buying more right here. You’d be dollar cost averaging in and taking advantage of the volatility that we’re seeing.
BARTIROMO: Yeah, I mean, it’s at thirty six thousand five hundred twenty nine, but just a couple of weeks ago it was at sixty five thousand. So there you go. All right. Great word on Wall Street, everybody. Thank you so much. Scott Martin, Kathryn Rooney, Vera and Michael Lee, great to talk with you. Have a wonderful Monday, guys. We’ll see you soon.
Reuters interviews Paul Nolte, SVP & Sr. Portfolio Manager
Kingsview SVP Paul Nolte discusses the evolution of cryptocurrency and how putting rules and regulations in place might be creating short-term volatility.
SVP and Portfolio Manager Paul Nolte discusses his latest market outlook. He weighs in on Bitcoin, and why he’s more interested in exploring the companies that may benefit from cryptocurrencies and blockchain than Bitcoin itself.
SVP and Portfolio Manager Paul Nolte discusses his latest market outlook. He also talks about why he’s more interested in exploring companies that may benefit from cryptocurrencies and blockchain, than in Bitcoin itself.