Valuetainment - March 05, 2026


“Saylor Will Survive The Storm” - Strategy DOUBLES DOWN On BILLION-DOLLAR Bitcoin Gamble


Episode Stats


Length

13 minutes

Words per minute

211.41676

Word count

2,795

Sentence count

244

Harmful content

Toxicity

3

sentences flagged

Hate speech

3

sentences flagged


Summary

Summaries generated with gmurro/bart-large-finetuned-filtered-spotify-podcast-summ .

On today's show, Rob and Mark discuss Michael Saylor's $200M Bitcoin purchase, and why it's a great opportunity to buy Bitcoin. They also discuss why Bitcoin is a great investment right now and why you should be buying it.

Transcript

Transcript generated with Whisper (turbo).
Toxicity classifications generated with s-nlp/roberta_toxicity_classifier .
Hate speech classifications generated with facebook/roberta-hate-speech-dynabench-r4-target .
00:00:00.000 Yeah, let's talk about this one here. So, Michael Saylor's strategy steps up, Bitcoin's buys by using common shares.
00:00:09.500 There are a lot of people that are sitting around saying what is going to happen with these guys if all of a sudden you get that famous movie that we've all seen in the financial industry, Margin Call.
00:00:20.800 Is there such a thing that this guy's going to get a Margin Call? Because either this guy has the biggest brass in the world, he's the biggest gamble in the world, one of two stories are going to be told about him in the next five to ten years.
00:00:33.720 He's either going to be one of the top five, top ten richest people in the world, or he's a name you'll never hear about.
00:00:39.340 It's kind of like if you've ever read the book Virgin, I don't know what it was called, with Branson, his mother said...
00:00:46.820 Losing my virginity.
00:00:47.680 Losing my virginity, his mother or his teacher said, either my son's going to be in prison or he's going to be a very famous man in the world.
00:00:54.880 So, Michael Saylor's kind of going for that. He bought more than $200 million of Bitcoin, turning to common stock to finance the bulk of its acquisition,
00:01:03.020 despite promises to lean on its perpetual preferred shares.
00:01:07.600 The company formed loans on MicroStrategy, about 3,015 Bitcoins between February 23rd and March 1st, according to regulatory filing.
00:01:15.520 Monday, roughly $230 million of the purchase was funded through sales of Class A common stock.
00:01:22.220 The remaining $7 million bought 3% of total, came from at-the-market sales of its stretch, preferred shares.
00:01:27.940 Rob, if you can pull up what prices are.
00:01:30.400 And by the way, previous week was $40 million.
00:01:33.960 Where's Bitcoin right now? $72,000.
00:01:36.320 So, can you go to six months?
00:01:38.980 6% today.
00:01:39.740 Go to six months?
00:01:41.120 Six months.
00:01:41.880 Down 50% off his high.
00:01:43.400 So, what do you think about what Michael is doing here?
00:01:45.480 Yeah.
00:01:45.780 Mark?
00:01:46.420 I'd love to answer this.
00:01:47.720 If we could, pull up strategy.com, pull up their website, and just look at some of these stats right here.
00:01:54.280 It's so new and groundbreaking, most people don't understand Bitcoin.
00:01:57.240 Of course, Jeff does.
00:01:58.020 We've talked about it for hours and hours and hours.
00:01:59.520 But because you don't understand Bitcoin, you can't really understand what strategy is doing.
00:02:03.480 And so, you're looking at it through the wrong lens.
00:02:05.540 And what do I mean by that?
00:02:06.760 First of all, the whole world, the financial world, is built off discounted future cash flows.
00:02:10.940 So, we buy stocks based off of a P-E ratio, and we hope that in the future, they're going to borrow money.
00:02:15.600 And in the future, they're going to invest it into their data center.
00:02:18.340 And hopefully, in the future, that'll make enough money where they can pay me back.
00:02:20.900 Or I do it through a bond, and I'll loan them money, and I hope they pay me back.
00:02:24.900 So, you know, the MAG-7's trading at a 30, 40, 50 times P-E ratio.
00:02:29.060 So, hopefully, they have the cash flow.
00:02:30.080 What strategy is doing is something completely different.
00:02:32.420 You give them money, and they buy the asset.
00:02:36.100 They're not hoping to have cash flow in the future.
00:02:38.680 They have the assets.
00:02:39.880 So, look at these charts right here.
00:02:41.160 What we can see right now, $2.2 million in cash.
00:02:44.180 But more importantly, net leverage, 11%.
00:02:46.600 Debt low is very low.
00:02:48.160 They have 30 months of dividend coverage.
00:02:50.420 But they have 58 years of assets to cover what they owe.
00:02:57.180 Now, if you don't believe in Bitcoin, none of this makes any sense to you. 0.99
00:03:00.180 If you believe Bitcoin's going to zero, then this is the stupidest thing in the world. 0.97
00:03:03.620 So, that being said, I don't think that's the case. 0.92
00:03:06.260 Now, some people want to look at either extreme.
00:03:07.980 Either Bitcoin's going to be a million or it's going to be zero.
00:03:09.980 No, it doesn't have to be.
00:03:11.200 Bitcoin could also just be $200,000.
00:03:12.880 I don't believe it's going to zero.
00:03:14.200 The chance, as Jeff said, asymmetric bets, the chance of it going to zero is barely zero.
00:03:19.580 So, if you don't believe Bitcoin's going to zero, then look at this company from a different lens.
00:03:23.740 58 years of assets to cover the dividend, $2.2 million.
00:03:27.360 So, that's the first underlying thing.
00:03:29.960 Now, secondly, why would he be selling common stock to buy more Bitcoin?
00:03:33.680 Number one, Bitcoin's down 50%.
00:03:35.240 It's an amazing buying opportunity.
00:03:36.700 Anytime it's around the 200 weekly moving average, it's a historic buy.
00:03:40.780 Number two, what he does is you can look here.
00:03:43.200 It says MNAB on the right there, 1.2%.
00:03:47.580 So, the company is being valued at a 1.2 times book value, price to book, if you'll call it that, right?
00:03:54.380 So, what that means is if he sells common stock to buy more Bitcoin at that price, it's accretive to what he's doing.
00:04:01.100 And MicroStrategy, people need to understand what they're buying at MicroStrategy is they're buying a ratio of Bitcoin per share.
00:04:09.680 So, the goal of MicroStrategy is to get the Bitcoin per share higher.
00:04:13.660 So, if I buy MicroStrategy, I want exposure to Bitcoin's price.
00:04:16.380 And so, I'm expecting him to get the amount of Bitcoin per share higher.
00:04:20.180 That's what I'm buying it for.
00:04:21.580 And anytime he sells common stock above one, it's accretive for me.
00:04:26.100 So, I can kind of stop there.
00:04:27.580 So, it's a smart move on what he's doing.
00:04:28.960 I think it's a very smart move.
00:04:30.140 And now, if you're a common stock holder and you don't understand this, you go, oh, I'm being diluted.
00:04:33.840 Now, what's the risk, though?
00:04:34.700 What's the worst thing that can happen to MicroStrategy?
00:04:36.680 Yeah, well, the risk would be Bitcoin going to zero and staying there forever.
00:04:40.760 I think the risk of that is very low, you know, almost zero.
00:04:44.280 What a lot of people don't understand is the way that he's built this debt.
00:04:48.060 So, what people say is, oh, if Bitcoin drops below $30,000, he'll get liquidated.
00:04:51.680 If it drops below $10,000, he'll get liquidated.
00:04:53.540 None of that is true.
00:04:55.040 None of the Bitcoin is pledged as collateral.
00:04:57.540 None of it is callable.
00:04:58.640 So, he can allow the stock to crater to $5 or $10, and he can just sit there.
00:05:03.980 And so, what?
00:05:04.820 As long as you believe Bitcoin is going to go back higher again.
00:05:07.420 So, again, if Bitcoin goes to zero, that is the risk.
00:05:09.500 But he can withstand the storm.
00:05:10.940 He's built up multiple layers of protection.
00:05:14.140 Again, $2.2 billion in cash or million in cash.
00:05:17.120 And so, the greatest risk is Bitcoin goes to zero.
00:05:19.920 As long as Bitcoin doesn't go to zero, there's really no risk.
00:05:23.520 Now, one of the things that he did when he converted MicroStrategy into strategy,
00:05:27.880 when he started doing this about five years ago in 2020,
00:05:30.320 he sort of bought out all the people that weren't aligned with this.
00:05:33.940 If you don't believe in what we're doing, get out.
00:05:35.880 Here's your money.
00:05:36.580 I love that.
00:05:37.060 All the institutions.
00:05:38.140 What are you doing?
00:05:39.060 Right.
00:05:39.560 Your business is over here.
00:05:40.660 Why are you buying all this?
00:05:41.620 He has control of the company.
00:05:43.400 Good for him.
00:05:43.920 He's bought out everyone who doesn't believe in it.
00:05:45.960 And all the shareholders have bought in, believing in this MNAV number
00:05:49.240 and the accretive function of what he's doing.
00:05:51.840 And so, there's not really a lot of risk unless Bitcoin goes to zero,
00:05:55.400 which, you know, Jeff, you could give probabilities on that.
00:05:58.000 I think it's a zero chance.
00:06:00.740 No, it's Bitcoin going to zero is not going to happen.
00:06:03.260 Right.
00:06:03.580 Not going to happen.
00:06:04.460 And you're right.
00:06:04.820 It's the MNAV that people are, what the market is saying,
00:06:07.820 the stock market is saying is we believe in Michael Thaler.
00:06:10.120 We're willing to pay a premium for Bitcoin stock,
00:06:12.600 which he's leveraging to buy more Bitcoin.
00:06:15.280 And unlike, I have no problem with what he's doing.
00:06:17.860 He's got 2.2 billion in cash,
00:06:19.380 which the biggest mistake that people in finance make is being forced to sell
00:06:23.160 because they're overly leveraged and then something happens in the market,
00:06:26.220 an adverse reaction.
00:06:27.160 They're forced to liquidate, and that's where bad things start to happen.
00:06:29.700 Forced liquidation.
00:06:30.680 That's not going to happen with strategy.
00:06:32.620 I'm more concerned about it happening with some of the other copycats.
00:06:35.280 Sure.
00:06:35.920 They're probably not in the same situation.
00:06:38.340 But all that's going to do is create a buying opportunity.
00:06:40.780 Let's say Bitcoin continues to go lower, which is, frankly, it's really possible.
00:06:46.200 I'm going to buy a ton of Bitcoin if it gets under $50,000.
00:06:48.720 You're going to buy a ton of Bitcoin.
00:06:50.660 So as far as strategy is concerned, they're not the one to be focused on.
00:06:55.400 Because this is sort of in my wheelhouse,
00:06:56.900 and Jeff and I have talked hours on Bitcoin,
00:06:58.800 I'd love to just point out, if I can, take a second.
00:07:01.720 I think this may be one of the most undervalued stocks that you could buy today.
00:07:05.680 I was about to say that exact thing.
00:07:07.460 And here's why, and it's a Bitcoin lens.
00:07:09.960 Okay, it's a Bitcoin lens, so bear with me on this for a second.
00:07:12.860 Look at the price to book 1.2 times.
00:07:15.120 So what Jeff is saying, that the market is paying a premium for this.
00:07:18.820 A big one, 20% is big.
00:07:20.900 Asset-heavy businesses trade on a price to book,
00:07:23.440 not a P-E ratio, but a price to book.
00:07:24.940 So banks, insurance companies, oil companies.
00:07:28.500 Cable companies.
00:07:29.300 Gold mining companies, right?
00:07:30.760 So if you look at banks, for example,
00:07:32.740 they'll probably trade in about a one to two times price to book.
00:07:35.880 And it comes down to their operational efficiency and what they have.
00:07:39.820 If you look at oil companies, they may trade in a two to three times.
00:07:42.360 A gold company might, like a Barrett Gold or Newmont,
00:07:44.480 might trade in a three times price to book.
00:07:47.040 Why?
00:07:47.640 Because they have gold in the ground.
00:07:48.940 Gold will be worth more in the future.
00:07:50.440 And then they have operational efficiency.
00:07:51.680 So the value of this company should probably be at least a three times book value,
00:07:56.600 because Bitcoin is more explosive than gold is, number one.
00:07:59.440 But also you can back it down into a mathematical formula based off the leverage that they have.
00:08:05.340 And he has it on the sheet there.
00:08:06.720 So I've had many conversations with Michael Saylor.
00:08:09.360 He believes three should be the floor.
00:08:11.620 The price to book rate should be about a three.
00:08:14.440 And we can get into the math of why that is.
00:08:16.600 So right now it's at 1.2.
00:08:18.540 Michael's strategy is on pace to have a million Bitcoin.
00:08:22.960 They're on pace to have that.
00:08:23.940 I'm guessing before the end of the decade, they'll have a million Bitcoin.
00:08:26.800 And I believe within the next six to seven years, Bitcoin's a million dollars.
00:08:33.820 So you take a million dollar Bitcoin times a million Bitcoin.
00:08:36.440 That's 5% of all Bitcoin.
00:08:37.680 That's a trillion dollars of book value, a trillion.
00:08:41.720 And you put a 1.2 times on a trillion, put a two times on a $1 trillion price to book value,
00:08:48.240 and then see what that does to the stock price.
00:08:49.700 Are you yourself in strategy?
00:08:51.220 Yeah.
00:08:51.740 And I guess I'm talking my book, but really I'm a Bitcoin guy.
00:08:54.140 But so we don't know how much the stock will be diluted up until that point.
00:08:59.440 So that's a question mark.
00:09:00.740 But that's for strategy, not for Bitcoin.
00:09:02.720 That's for strategy.
00:09:03.720 Right.
00:09:03.900 Yeah.
00:09:04.000 There's 19.9 million Bitcoin right now.
00:09:07.020 We're about to have the 20 millionth Bitcoin mined.
00:09:10.760 And there's a cap of 21 million.
00:09:13.440 So therefore strategy, think of it this way.
00:09:16.100 There's only 21 pristine Michael Jordan rookie cards.
00:09:19.720 They're going to own one of them.
00:09:21.060 And so now when the mining stops and you're at 21, at least in this crypto, suddenly you
00:09:28.960 now have the supply side pressure on Bitcoin demand when Bitcoin is more broadly demand,
00:09:35.340 which only helps strategy.
00:09:38.440 You know, I'm on the same page on what they're doing.
00:09:41.340 Yeah.
00:09:41.480 One out of 21 will be owned by Michael Saylor.
00:09:45.060 And what he said there is that they told shareholders they would lean on the preferreds.
00:09:49.300 And I think that's just worth touching on for a second, if you don't mind.
00:09:52.040 So the preferreds, they've launched Strike, Strife, Stride, and now Stretch, STRC.
00:09:56.160 It's the newest addition that they have.
00:09:57.520 And I believe it's the most revolutionary product that's ever hit the market.
00:10:00.600 And nobody can, most people can't really comprehend what it is.
00:10:03.600 So what he's doing is you're taking a high vol asset like Bitcoin, a high beta asset.
00:10:08.020 Over the last three years, it's about a 75% CAGR, compound annual growth rate.
00:10:12.920 Now, it's very volatile, right?
00:10:15.100 It's very extremely volatile.
00:10:16.280 It's down 50% right now.
00:10:17.260 But what he's saying, sort of like a bank, give me money and I'll give you a dividend
00:10:22.340 off of that and I'll invest the money and I'll make the difference.
00:10:25.060 That's what he's saying, right?
00:10:26.000 So he's saying, hey, you give me money, I'll buy Bitcoin.
00:10:29.380 I expect it to do a 21% CAGR over the next 20 years.
00:10:32.280 That's his projection.
00:10:33.120 21% over the next 20 years.
00:10:34.540 You give me money, I'll give you 10.
00:10:37.840 I'll hold through the volatility.
00:10:39.260 So right now, Stretch is paying 11% or 11.5%.
00:10:43.740 So it's a stable yield.
00:10:45.880 I don't know if you know about this, but it's pegged at 100, okay?
00:10:48.620 So the goal is, is they can manipulate the supply and the yield to keep it pegged at 100.
00:10:54.320 So it's like a money market account.
00:10:55.780 I put $100 in, it's always $100, but I'm earning 11.5% on it.
00:11:01.000 And he's doing that by, again, scrapping the top off of the high vol.
00:11:05.940 Is he keeping eight and a half?
00:11:07.380 Well, he's keeping the difference.
00:11:08.480 So he expects Bitcoin to do 50%.
00:11:10.440 He's going to give you 10, he's going to keep 40.
00:11:12.420 39 of it goes.
00:11:13.240 39 of it, right?
00:11:14.180 And so what he's doing is, right, obviously the CAGR is going down over time, but he believes
00:11:19.760 it's going to be higher than 11, but he can also lower that yield.
00:11:21.800 But just think about this for one second.
00:11:23.600 In the United States, and Jeff probably knows these numbers better than I do, in the United
00:11:26.400 States, there's about $28 trillion earning yield.
00:11:30.760 I think there's, what, $7 trillion in money market accounts alone.
00:11:33.540 The fixed income market is the largest market in the world, $350 trillion.
00:11:40.420 And he just asked a simple question.
00:11:41.700 How many people have a bank account?
00:11:42.980 Of course, everybody does.
00:11:43.840 How many people would like to earn 10% in their bank account?
00:11:46.640 Of course, everybody would.
00:11:48.180 And he's basically paying 11.5% on a bank account, on a stable yield.
00:11:52.680 And why is that the largest sector for people that don't understand the underlying demographics?
00:11:56.960 The boomers. 0.98
00:11:57.840 The boomers are older. 0.93
00:11:58.720 They don't have time to recover from a market crash, and fixed income is their friend.
00:12:02.720 In the 1970s and 80s, they used to call it the widows and orphans stocks.
00:12:06.400 GE, Coca-Cola, IBM, Hilton were like paying the best dividends.
00:12:10.780 So when you had a life insurance payout on your father, the broker would say to your mom,
00:12:15.700 we're just going to put these into dividend stocks, and then you're going to keep getting
00:12:18.700 this back.
00:12:20.120 And that was a form, that was like early fixed income thinking, but now fixed income is
00:12:25.960 massive.
00:12:26.580 Massive.
00:12:26.920 All these boomers. 0.99
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