Why the SpaceX IPO Exposed Wall Street’s New Playbook: Mike Green

If you look at the Space X IPO under anything other than where it traded at its peak in the immediate aftermath of the IPO, this has been an unbelievably successful IPO. Now we have discovered that index funds can be used as tools to facilitate the exit of insiders and the liquidity associated with it. It's very hard for me to imagine that this is going to turn into a moment for, you know, internal reflection and soul searching on the part of Wall Street. If anything, I see the teams lining up to say, you know, how can we get more stuff done this way? Because it's very profitable, except of course for the the small retail investors who piled in at the extraordinary heights near 200. And the reality is this is that it's [music] a terrible way to say it, but nobody cares about that. >> [music] >> Welcome in everybody to another episode of Coinage. I'm your host Akruzman coming to you live from our Brooklyn studios here in New York City as we are unpacking all of the big moves in markets today. A lot to dig into. Not only as we are still watching Space X shares move around post that record IPO, but of course also geopolitical concerns back in front of us as President Trump says that the Iran ceasefire is all but over. So a lot to dig into today and very excited to have on with us Mike Green, Simplify Asset Management Chief Strategist back on Coinage. Mike Green, good to see you again, sir. >> It's great to be here. Thank you for having me. >> Yes, I mean I think I just kind of want to start with where you're at right now because obviously we are in a what seems like a new paradigm after Fed Chair Warsh is now in, but a lot to deal with when it comes to concerns both on the Iran front and inflation. What's Mike's take right now on on where you think markets head from here? >> I don't know. I have to ask him. Um the uh Look, I mean, what is happening in terms of the war and the development there is is somewhat predictable. It seems to be a function of you know, how is the public perceiving it? Um, we wanted to get gas prices under control for the midterms. By delaying it, we took advantage of that and we've ultimately achieved those objectives. Now we're looking at much, much lower oil prices. Gasoline prices are better behaved. Inflation should have a negative print this month. Um, and the question is like, what are we actually going to accomplish with this or what are we going to do? Um, the United States has resources that allows it, just like Russia, unfortunately, with Ukraine to persist for an extended period of time. It sounds like that's the game we're now getting played into, which is from my perspective unfortunate in a geopolitical sense. The last thing I want to see is the United States tied up while it has much bigger fresh fish to fry or to deal with situations to deal with in the the relatively near future is my expectation. Um, but you know, this is playing out and as we're slowly discovering, it really doesn't matter all that much. Unless we see a material change in the direction of flows or the capacity of budgets, which we could see stressed again if oil prices were to rise significantly, then things could get ugly. But until then, like, I'm not sure it really matters all that much. The average person waking up today and going to work is not spending their day, you know, cowering in a bunker in the United States. That's the real benefit that we have in our geography. We're protected from all of this stuff for the most part. >> Yes, and it is kind of I mean, I guess in in relation to kind of discussing war, it is a bit strange to kind of uh unpack a couple uh percentage points in inflation and what that can do here. But I do think it is kind of interesting just to think about how this chapter might be different for markets when supposedly Trump now has his man, even though Jerome Powell was of course also Trump's election uh leading the Fed. But I am kind of >> [laughter] >> I am kind of curious how he might think that it could change things because it doesn't seem like he's helped his new Fed chair at all by kind of reinvigorating inflation concerns. >> Again, you know, I just I come down to the point that says I think a lot of what is going on is we are trying to manufacture interest in news that is relevance to the financial markets. Inflation, when we talk about it at 3% or 4%, it's really critical people understand that that is that is material and that is unfortunate. And it absolutely hurts people who are already struggling with expenses. But to have a war in the Middle East with unprecedented you know, supply disruption in terms of the oil markets and to have that manifest itself in 4% inflation I I I really just struggle with the perspective on it. Like it's it's it's a strange situation that people are this worried about the completely predictable and understandable impact and that it has been as mild as as it has been to this point. Now the absolute level of the price level is a much bigger issue and the unaffordability of many things in life like housing etc. are very much concerns that the average American and our political leaders should be paying attention to. But gasoline prices at $4 a gallon is not something that I think is really you know, should should be driving Fed policy in any meaningful way. >> Yeah, I almost feel like it it's been interesting to kind of watch some of the construction of tasks force or the task force tasks forces the plural version of task force that Fed chair Warsh is now kind of putting into place and of course we're going to see kind of some of the thinking evolve there. But to your point, it does seem like AI is increasingly becoming a piece of this increasingly because if it has impacts on the labor market, I think that that's more interesting to discuss. Um certainly I think fears are rising just around what that can do to kind of displace some of the more Originally, it was more around blue-collar workers, but increasingly more around white-collar workers. Uh I don't think that the Fed really has any tools at its disposal to really fix any of these things, but I could be wrong. You could say I'm wrong. Uh but it seems tricky. >> No, I think it's true. And I think actually the core issue that we have with the Federal Reserve and interest rates right now is largely the impact that it has on fiscal policy. We're spending roughly a trillion dollars in incremental interest because of the Fed's policy, and that is actually a form of stimulus. It's flowing through two sizable fractions of the US population. Um for those who need to borrow funds, a 4% Fed funds rate is not determinative. It's not really what affects it. What affects their ability to access credit is the ultimate affordability of the asset, i.e., the house or the vehicle, the car itself, and the interest rate and the premium that they're going to have to pay on top of that. You know, we're finding a larger and larger fraction of the US population that is unable to obtain credit under reasonable terms. Um the latest pop in gasoline prices simply exacerbated that, driving them into negative spending, forcing them to take on credit card debt in a variety of ways. And this is a little bit of a slow-motion train wreck. We have you know, the top portion of the economy that is largely tied to the stock market that is doing extraordinarily well with markets near all-time highs and showing no real evidence of being disrupted in any meaningful way. And then we have the vast majority of individual households that are confronting the reality that they can't move to change jobs. They can't find a job in many situations. The jobs that are being created are low quality. The total number of full-time employment jobs have actually declined over the last four years. These These all creating conditions in which people feel that the, you know, term of the last decade, gaslighting, really applies to them. They're being told the economy is doing great. They're being told by a, um, you know, commander-in-chief who has become cheerleader-in-chief for the policies and the results or the perceived results that their life is should be, you know, better than ever. And they're confronting the reality of that and saying it doesn't feel that way. >> Yeah, it was it is kind of always strange for me personally to kind of watch uh President Trump talking about that at his rallies uh in terms of 401(k)s and everything else and the markets being at all-time highs is is not something historically that we've really seen from presidents. Um, but I do think maybe that's a good transition point into what you and I were talking about before it all happened, which of course is the SpaceX IPO. It's been a few weeks since then. Um, and certainly I want to get your take on kind of where we are with that and your thoughts as you saw it play out because it's now in the Nasdaq 100 and a lot of these other funds. Uh, what do you make of the process in terms of how that IPO has gone as now we've seen shares come back to almost uh equal with where it debuted? >> Yeah, I think the really critical thing to understand is just that almost equal to where it debuted is five times higher than where it was a year ago. And so it is really critical to understand that the performance after the IPO is largely tied to, you know, the retail demand to participate. They've heard about how hot this is. They've heard all the skeptics, which are, you know, old white men like me, say various things that, you know, are supposed to scare them off and instead they embrace it and rush into it driving prices significantly higher when you have under allocation like you have like that. But the really key thing on the SpaceX IPO is just that we dialed in the information to the participants that there was going to be a buyer that would bail them out sometime in the 5 to 15 days after the listing, that effectively freed them to send prices to extraordinary levels. And so, we shouldn't be thinking about SpaceX's performance on the IPO or immediately after the IPO returning to the IPO price is actually exactly the point. That's the level at which the demand was calculated to determine where it would ultimately play out that would allow insiders to exit and those who had participated in prior to the, uh, public rounds in anticipation of the index inclusion, it allows them to exit. And that's really what they care about is it's largely a non-arbitrage profit. That is the key thing with passive vehicles. They effectively accept whatever price you put in front of them. If they can participate as quickly as they can in the case of SpaceX, it supports the valuation for those who are seeking to exit. The problem with a traditional IPO is is that it would be 6 to 6 to 12 months before they would be eligible for those index flows. And as a result, they relied on active managers who are losing assets and were unable to maintain those prices. This is why IPOs have struggled under the traditional framework. And with the new listing uh characteristics of Nasdaq that inflates the float, it ultimately should facilitate additional IPOs. My hunch is is that SpaceX will actually be more of a footnote in terms of its listing, um, potentially more like a Netscape, uh, if you're familiar with the dot-com legacy which actually kicked components to this off in 1996 as compared to a a final super speculative IPO. I realize that sounds insane given the valuations, but that is where it ultimately seems to play out. We've changed the methodology. This will facilitate increased supply. It will facilitate new companies coming public. And unfortunately, the only companies that it helps come public are the giant unicorns that have been created over the last, uh, couple of years in the in the private markets. >> Well, I want to I I maybe I should ask a follow-up question on that too just for those who aren't as familiar cuz this was something we were chatting with Dan Niles about as well. And I guess we can talk writ large in terms of over-exuberance in the AI and chip space right now. But his general take is just that there's still much more room to run even if this is a bubble that it's more kind of like you said even back then in the in the 1990s and that big boom originally everyone kind of knew that we were in a bubble but there was still time to go. And in that there's a lot of chop and still opportunities for active investors to really play those things. Is that kind of the the general takeaway with this one cuz I I mean after the SpaceX IPO Anthropic OpenAI basically everyone kind of hit the bricks. >> Hit the bricks you mean planned on an IPO? >> Yeah, I mean the the enthusiasm around Anthropic and OpenAI kind of the idea of you thinking generally was like hey if the SpaceX one really goes well we'll come out right after there's appetite here but it doesn't seem that way anymore. >> It does not seem that there is appetite for SpaceX? Cuz it it doesn't seem like there's that much >> Yeah, that there's that much appetite. I think we saw reports that the OpenAI IPO is basically being pushed is what I saw. >> Yeah, the question is whether that's OpenAI specific or not. I mean look I got to again reiterate if you look at the SpaceX IPO under anything other than where it traded at its peak in the immediate aftermath of the IPO this has been an unbelievably successful IPO. It's facilitated SpaceX immediately raising a bond issue several bond issues. It has created incredible liquidity for the employees of SpaceX which have been locked up in one form or another for the most part for well over a decade. Um and this has occurred in an environment in which we've had very few mega IPOs in this in the past. Almost all of them have been a function of direct listing. So, to pull off any share sales whatsoever is actually an extraordinary feat. Um that it is done, as I said, at roughly five times the level that SpaceX was trading in secondary markets just a year ago. Um I mean, I'm on the other side of that trade. I think this is actually gone spectacularly well, except of course for the the small retail investors who piled in at the extraordinary heights near 200. And the reality is is is that you know I it's it's a terrible way to say it, but nobody cares about them. >> [laughter] >> Well, I think that maybe that's where maybe that's where I should clarify what I'm talking about in terms of my lens. And I was actually talking about you when I was back on Yahoo Finance. It was mostly the retail trade. Cuz that's the audience that we speak to is mostly, "Hey, do you want to buy this on IPO day and and have to deal with what's to come?" And my general take was, "No, it's probably not a good idea." And glad that that was the take. But But I guess you know, it is it is kind of the the more important piece here is that you know, it's a question of of what comes next. And I guess, you know, if we are here, what the rest of the year looks like for SpaceX because we're we're we're kind of digging into before we hopped on some of the analysts pricing. And this is a dynamic that I think is always interesting just in terms of where price targets come out at depending on if you were involved and whether or not you believe in the Chinese wall that separates analysts from the other side of the business and kind of getting these IPOs to market. Um some of the price targets out there, I guess just to kind of run through them right now, very interesting. You got Morgan Stanley at 300, UBS 210, uh Goldman Sachs 205. Some other more reasonable price targets at 165. I mean, I guess I'm not asking you where shares are going to be, but just if you do think that it went really well, I don't know. Maybe that continues. >> Well, again, it it's going to follow the path that it is you know, it is going to follow the path that you would expect given the quantity of insider selling that is likely to occur alongside the quantity of passive buying that is likely to occur. As the insiders continue to sell, the float will rise. That will increase its representation in indices. Um, but right now what we're seeing is basically the the supply the demand for shares coming from the index is largely facilitating those who bought ahead of the IPO exiting. Um, I I'm not sure why that should translate to very strong pricing. Um, the behaviors were extraordinarily well calculated as you saw with the announcement that two Millennium traders made 3.7 billion dollars on index arbitrage in the last quarter. You know, these are really really smart players who are basically figuring out how far can they push this under a leveraged framework given the underlying demand that is occurring. But the really critical part of this is not actually the SpaceX IPO or the SpaceX stock price as much as it is that we have now now we have discovered that index funds can be used as tools to facilitate the exit of insiders and the liquidity associated with it. It's very hard for me to imagine that this is going to turn into a moment for, you know, internal reflection and soul searching on the part of Wall Street because people have lost money from 200 to 160. Um, I I just don't see that happening. If anything, I see the teams lining up to say, you know, how can we get more stuff done this way? Because it's very profitable. >> Yeah, I would add that that certainly seems like the more realistic outcome here. One of the other elements from the SpaceX piece, which I think is tied into something I've seen you tweeting about as well, is we had one of the CEOs of the leading hyper liquid digital asset treasuries on. It's been very interesting. I don't know how much attention you've spent on looking into kind of hyper liquid and the idea of the increased use of perpetual futures both among retail traders by the way and the more sophisticated traders. Uh more sophisticated traders we're talking about at hedge funds. But we were talking with David Schamis about kind of SpaceX perpetual futures being listed and how that was tracking leading into the IPO and the listing. Since then of course you've seen CME and a lot of the other big players including the NYSE kind of coming out and saying, "Hey, is anyone going to regulate this space and is anyone going to try and stop this from happening?" As they see their business potentially be threatened there. Um I don't know if there's anything that kind of revealed itself to you in that process, but it was kind of interesting to see some people speculating ahead of the IPO maybe potentially flipping what we've just discussed where some retail traders were able to not necessarily trade real shares and certainly didn't have anything to dump on retail markets. But if that's kind of a sign of other things to come, it's interesting to think about as those markets become larger and larger what they could do to the IPO process. >> Yeah, I mean listen everything that you are describing are ways of synthetically increasing demand for shares. Perpetual futures offering extraordinary leverage allow me to use $1 to buy $100 worth of something. What matters is I bought $100 worth of something and can I repay that leverage that I took on is a subject for another day. Um and who ultimately bears those losses when you create exchanges that are ultimately neutral parties, ultimately you know that the inexperienced trader is the one that is almost certainly going to take the loss on the on the aggregate basis, right? If I add up all the traders, sure there will be individual winners. Um that type of innovation, right? Where it is innovation to access and innovation to buy more of something is simply a way of synthetically increasing aggregate demand. Um it is very natural to expect that to lead to an increase in prices and a subsequent increase in supply. And that that is really what we're discussing here is is that all the technology has been focused around how do I increase people's ability to obtain access to these securities with leverage magnifying their purchasing capability and it's an outward shift in aggregate demand that in turn causes prices to rise, which in turn causes supply to respond, which caps prices relative to what you would otherwise seen unless you add additional sources of access or leverage. It It's It's not that surprising. I mean, this is being done to facilitate the creation of liquidity for the insiders. It is not being done for the benefit of the investors. >> Mhm. I mean, I guess maybe that's a good segue to into Well, first before we move on, just kind of curious how you interpret maybe some of that playing out because it is interesting to see some of the incumbents push back now. I don't know why it took so long, but now you are seeing kind of the CME I mean, they have the lawsuit against the CFTC. You're seeing some of those industry players push back because to your point, the leverage on HyperLiquid, I believe, is like it literally 100x. Whereas, I saw you tweeting about I'll just bring up the tweet, but saw you tweeting about a lot of the other leveraged ETFs, with those we're talking like 2x, 3x. Those are things that are approved through the normal process, goes through all the normal pieces at the SEC, comes out, and everyone can play with leverage through those. But that's, you know, a huge difference when we're talking about 2x versus 100x, I would think, and how you're seeing how you see this play out. You You were tweeting about it in the context of overall semis and things like that, but just kind of want to get your take on >> Yeah, I mean, so there is a there is a small difference. Um, you know, when you enter into a perpetual futures contract, the leverage that you obtain at 100x doesn't have a systematic rebalancing component to it. So, you have you have a choice as a trader. Are you going to roll your winnings into additional funds? And, you know, at a 100x it becomes simply absurd. I put up $1, it magnifies to $100, the security rises 10%, that means I made a you know, I made a 1,000% on my money. I've now got $10 worth of equity and only $99 worth of debt. If I'm going to maintain that leverage, now suddenly instead of buying 100, I've got to buy 10,000 um in terms of total exposure and so my my uh sizing has now magnified 100 times because of that gain. That's just you know, those create feedback loops if you execute them systematically that are actually far more concerning than the behavior of any one individual trader who under rational circumstances at 100x should be taking chips off the table. I'm not sure they're doing that, but that is what they obviously should be doing. Um in the case of the ETFs, because they have embedded in them a systemic a systematic rebalancing feature, which means that every day they have to maintain a constant leverage exposure, they effectively are parlaying those winnings or losings into additional or reduced leverage and purchasing power. Same example, I have an ETF in which I commit $100, it is a three-to-one levered ETF. That means that there's $300 worth of purchasing power. The underlying security appreciates 10%. I've now got $330 of total value of which 30 is now equity. If I'm going to maintain my exposure, that means without any funds being contributed to the ETF at this stage, I now need to go out and buy $60 million of additional underlying asset, which theoretically can drive the price higher as well. Um the reverse happens on the other side and so there's a function of endogenous liquidity in which these funds are manufacturing their own demand for these securities when they're being run in this systematic fashion that makes them much more important to focus on than even access to 100x leverage, which has its role, but overall I think it's kind of stupid. >> Well, it is I mean I the the interesting piece of pairing both these points and both these discussions is that if you are a retail trader that has no other choice but to start to behave irrationally because this is kind of the game as it's now played is what does that do for markets? And and what does that start to look like when all of this is built in to your point where it's all you can do. I don't I don't know. It's almost as if there might be the shadow kind of perpetual paper trade things as you wish situation where they're not attached to any securities directly. Um but it's really just a layer of speculation that sits on top of everything. And with prediction markets too, I mean Kalshi now has perpetual futures too. So that's a weird world we're living in, I think. >> Yeah, I mean the world unfortunately that we live in is is that these are all variations on casinos. We know the profitability of the underlying operation a function of taking not directional bets, but effectively the margin on the expected results versus the payouts. Um that means that they're self-liquidating. So we are basically piling pools of capital into speculative and gambling exercises that don't actually generate under any underlying free cash flows. It's not like traditional investment or true investment in which I'm providing funds that can ultimately be used by those companies in order to build factories or to develop products and services. And this is pure speculation and it is a an understandable byproduct of a society that has largely been taught that it's all nihilism from the top to the bottom, right? This the president doesn't really believe, you shouldn't really believe, um you know, you might as well get yours while the getting is good. >> Well, the president made a little bit I think more than half a million half a hundred well, half a billion dollars on his meme coin alone. So we can get into the crypto piece. I want to ask you about Bitcoin and an element that you were right on when it comes to strategy in a second, but before we move on, I guess to compare the points that we discussed with you last time, how do you see some of those elements among retail traders and kind of the idea of speculation and increased speculation then playing out to what you warned us about last time, which is a 1929 style collapse that could come in I don't know what the timeline on on that call was. But how do you compare those points? >> The call was for last Tuesday, so it was wrong. No, I'm joking. Um The um So, what is happening right now? I mean, if you just if you if you just stop and think about a world in which all you can observe is the returns. You don't read the 10-Ks, you don't listen to the investor report of the investor calls, you don't care about any of those things. All you see is your neighbor getting rich. The reality is is that the demand that is coming through passive vehicles and our decision to switch to a 401k retirement system has shifted out the aggregate demand. If you're trying to put on your economist hat, we have increased the demand for financial assets. At the same time, 2008 and the challenges associated with the dot-com cycle somewhat reduced the ability to get individual firms public, and so the quantity of shares were shrinking. So, we have an outward shift in aggregate demand and an inward shift in aggregate supply, much of which was actually re-manufactured as demand in the form of stock buybacks. Um and then we chose to make it super simple for people to access these products through ETFs, which require them to be executed immediately and have to be executed against these strategies. We've now introduced leverage, 1x, 2x, 3x, 10x, 100x leverage that allow people to buy more of this. All of this is simply shifting out the aggregate demand, and all else equal that causes prices to rise relative to the underlying fundamentals. Eventually the system breaks. Eventually we run out of additional capital to bring into the system and the more leverage we bring into highly volatile instruments like a 3x closely correlated single stock product or a closely correlated sector product, the volatility drag associated with that eventually just eats investors. And so they think that they're paying relatively low fees in terms of management, but they're paying an extraordinary fee in terms of education that simply comes from the compounding effect of a vehicle that is that volatile, what we call volatility drag. If a market is up 10% one day and down 10% the next day in the academic literature because we use arithmetic averages, that's plus 10 minus 10 averages out to zero, no loss. The reality is if you invest as most people do in a series, you are exposed to what's called geometric compounding. You start with $1, next day it rises to 110, then it loses 10%. Guess what? You're left with $99 or $0.99. You've lost 1% of your portfolio due to that function that's called volatility drag. Now do the same thing on 60 vol instruments levered three times and you can very quickly see how these are self-liquidating pools of capital that are no different than the losses that we see from Cal sheet or elsewhere. And ultimately the ability to replenish that capital is a function of people having jobs and having surplus uh spending capacity which in many situations for the young is facilitated by not actually having had the individual step of stepping out to to form their own households. And so they're skipping out on rent and using that instead to speculate in a way that allows them to fantasize they may ultimately escape it. But the reality is is that they're not actually making investments, they're simply speculating and will ultimately lose those funds just like they would on a very fun weekend in Las Vegas. >> Yeah, it's uh I feel like it's a a natural follow-up to uh to the the themed Substack post we discussed with you last time just in terms of increased uh speculation and gambling, especially as it becomes more, you know, prominent and accepted and basically legalized uh in your pocket. But, I think uh maybe all of that is a good segue as well into what we discussed last time, which was strategy, because as you discussed, sometimes some of the leverage can be disguised away, and you might not even see it, and you might think you're just buying a normal stock when under the hood there is a lot of leverage. Back then, in April, we discussed with you what Strategy was doing. Bitcoin, I think, was closer to about 75K, uh and you mentioned that there was a lot of reason to be more bearish. We're down closer to 60K, but just want to remind our viewers what you said back then around Strategy, as we were trying also to kind of highlight some of the leverage built into it. We'll play a little bit of the clip, Mike, and then get your take on the other side as uh we've come down a bit since then. Here's what you told us back in April. >> Unfortunately, that means that in an event that proves adverse, you are forced to dilute yourself in order to dilute yourself, and you typically have the inability to raise the cash to meet those obligations. It creates conditions under which that system is inherently fragile, and people will almost certainly be exposed to significant losses. >> Now, of course, uh since then Bitcoin's down by about 20%, but Strategy shares are down, I think, even more, and uh they've come out and said, "Hey, look, we might actually sell our Bitcoin to stop this negative flywheel from happening." But, I don't know if that's changed any of your thinking. I don't know if MicroStrategy says we're out of the woods yet, or if you're still in the camp of don't touch Bitcoin. >> Well, I I mean, unfortunately, and by the way, Strategy's down 75%. Um >> There you go. >> The it it >> [sighs and gasps] >> You know, look, nothing has changed. He is still adopted an extraordinary levered exposure. Um he will always need to sell Bitcoin in order to obtain liquidity unless Bitcoin rises enough that he can increase his borrowing capacity against it. It's the same phenomenon that we were highlighting before. He is running a levered exposure to a highly volatile asset. And the volatility drag will ultimately eat this company. The only way it is saved is if Bitcoin goes to extraordinary new highs. Um I'm sure you have Bitcoin proponents in the audience who say, "Well, that's totally natural and that's fine." If that's the case, you are betting with Mike Saylor on Bitcoin in a somewhat levered fashion. Um if on the other hand you look at Bitcoin and you say, "Gosh, you know, it really doesn't seem to have much in the way of headlines anymore. I can't think of anything useful that has come out of Bitcoin in extended period of time." Um and the underlying experiment seems largely to have failed because it was built on failed precepts in the very beginning. Then you know >> Which failed precepts do you think are Which failed precepts? >> Super straightforward. It's a It's a misunderstanding of monetary policy. I mean, the idea that you can actually create a peer-to-peer payment system and then suddenly morph that into a speculative vehicle simply on the basis of of scarcity that ultimately will become the backing of a new monetary system that fiat governments all over the world are going to shove aside their existing tax and capability to accept is just patently absurd. Um It It's really straightforward. Um and you know, unfortunately, people believe in all sorts of really silly things. And Mike Saylor and Bitcoin are among them. >> Yeah, I think it's been interesting to see but I think by the way the the apples-to-apples April 30th comparison, I think strategy shares are down 43%. Uh so kind of about double what we've seen in the move of Bitcoin since we had you on last time. I think it's a good point just in terms of the expectations and how this is all morphed. I think you might recall when it was also supposed to be a hedge against uh inflation and digital gold and that hasn't necessarily panned out either. Um but nonetheless, part of portfolio strategy, I suppose, if you listen to uh Kathy Wood and other people around uh having it be included in things. Um I think the other element, too, which we'll discuss, is that it performed better than equities when we went through the Iran war chapter one, but a lot of that was fueled by actually strategy buying. So, a lot of analysts, including Fundstrat, now saying it might be even shakier in this next chapter if the ceasefire is indeed ripped up. But Mike Green, we'll leave you with kind of the last thoughts as you're seeing the next uh back half of 2026 play out. Um if there's anything maybe to call attention to as we wrap up here, and again, always remind people that you you write some of the best stuff I've seen in markets on your Substack. So, if no one subscribed yet for our audience isn't subscribed yet to Mike Green's Substack, definitely do that. Um but I think the back half of the year is interesting to think about just in terms of active managers playing catch-up. This is something that we've heard from Tom Lee that it would expect. He still says we're going to shoot back up to even, I think he's still got like a 10% uh end to the year, 10% more to go on the S&P 500. What do you think about where we sit here at the halfway point? >> Well, I I think, you know, part of the point that I constantly try to emphasize for people is is that the way that we have chosen to invest for retirement has materially changed. That has changed the behavior of the stock market. And as you heard me walk through various examples, we have increased our aggregate demand for financial assets. Um that has contributed to a positive drift at this point. Simply the mechanism of the shift to passive appears to be adding close to 18% a year to the US equity markets. So, Tom Lee and I would be basically in the same camp. Um you know, we're up 9%, and I think ultimately we'll probably get another 10% as it relates to the passive flow. There's any number of reasons why that can change, but it I I don't really materially see it changing, and as a result, I you know, I kind of find myself in the same place. Unfortunately, that's tinged with, as you can tell, a note of sadness because this is not actually investing. This is simply money being shoved into a container and the container being forced to expand to the to the quantity of money that is being shoved into it. Um and it it means that there is an extraordinary amount of pain that is eventually going to emerge because of it. Um if there's one thing I try to to drive home for people, it is that we are playing a variant of the Chuck Prince, you know, famously misunderstood and misquoted line, "The music is playing and so you've got to keep dancing." Um but man, are there ugly girls at this party. >> [laughter] >> Yeah, well, I think uh I think it was a It's a metaphor I wasn't prepared for, but I think that it's a good place to to maybe wrap up here and and again, would stress that would love to have you back on the show to kind of discuss this. I don't know when the music stops, no one ever does, but uh certainly I think the warnings are well heard from our audience as we have you on and and they love hearing your thoughts. So, uh can't thank you enough again for the time. >> My pleasure. Thank you very much. >> Thanks, Mike. Appreciate it. That there uh we'll wrap up with Mike Green as as we have uh discussed, not just Space X, but everything else there included, uh the moves in Bitcoin. Simplify Asset Management Chief Strategist Mike Green joining us again, and that will do it for this edition of Coinage. As a reminder, you can always head to coinage.media to mint a membership and co-own our community-owned media outlet with us as well as the co-founder of Netflix and the rest of our community. For them, for Mike, for myself, we thank you for tuning in as always. We'll see you again soon.