Valuetainment - June 03, 2025


＂Stock Pile Bullets＂ – Jamie Dimon SOUNDS ALARM On Bond Market MELTDOWN

Topics
stockpiling bullets
Hosted by
Patrick Bet-David
Mentioned
Jamie Dimon Bitcoin Brandon Trump Doge Elon Musk AA Fitch J.P. Morgan Gary Adam
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Episode Stats


Length

10 minutes

Words per minute

211.91

Word count

2,274

Sentence count

209

Harmful content

Toxicity

6

sentences flagged

Hate speech

1

sentences flagged


Summary

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

In this episode, we discuss the recent credit rating crack in the U.S. bond market, what it means for the economy, and what it could mean for the bond market in the future. We also discuss the impact of the Fed's QE program and the impact it could have on the economy.

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 .
Topics generated with Qwen2.5-3B-Instruct.
Hosts, guests, and mentioned names generated with spaCy (en_core_web_sm), reconciled against Wikidata.
00:00:00.000 I don't know if you guys saw this or not.
00:00:01.160 First time in 100 years, U.S.'s credit rating is officially double A from all three rating services.
00:00:09.740 I don't know if you heard about this.
00:00:10.940 First time in 100 years, right, if I'm not mistaken, since the 20s, 1920s,
00:00:14.820 that we now have double A with Fitch, double A with Moody, and double A with S&P, all three of them.
00:00:21.780 So this doesn't happen.
00:00:22.780 What does that mean?
00:00:24.060 You know, when I was selling junk bonds or you sell bonds and you buy a junk bond,
00:00:29.560 they would pay 20% or 24% or 18%.
00:00:33.460 What is a junk bond?
00:00:34.620 Like, oh, my God, it pays 18%.
00:00:36.300 Yeah, but it's most likely to go out of business because they're not going to be able to pay off the debt.
00:00:39.560 It's like a desperation deep paper.
00:00:41.580 But if you get something that's like, oh, it pays 3.5% treasury bond, it's a T-bill, it's a T-bond, it's a 10-year,
00:00:46.460 it's a da-da-da-da-da, credibility is you're guaranteed to get paid on this, right?
00:00:50.260 So the lower it goes, rates go up.
00:00:52.320 We were talking about this yesterday, Brandon, so I'm going to come to you here in a minute.
00:00:54.980 But I want to play a clip for you guys from Jamie Dimon.
00:00:57.860 Rob, if you can play the clip of the crack in the bond market, you know, if you have, is this the one?
00:01:04.280 This is it.
00:01:04.820 Go for it, Rob.
00:01:05.560 Play this clip.
00:01:06.460 You know, these are very large numbers.
00:01:10.300 You've seen it a little bit.
00:01:11.680 You know, you had the crack in the bond market and COVID a little bit.
00:01:14.760 You know, the government did the right stuff, then they massively overdid both spending and QE.
00:01:18.180 We borrowed and spent $10 trillion from 2020 to today.
00:01:23.620 Wow.
00:01:24.240 Okay?
00:01:25.060 And you heard the numbers before.
00:01:27.800 We also bought $4 trillion of your securities on top of the $4 trillion we bought in the first go-round.
00:01:34.100 Those numbers are true globally, not quite as big as ours, but the QE of us was $8 trillion.
00:01:40.360 The QE of the rest of the world was another $8 trillion or something like that.
00:01:42.960 You're talking about huge sums of money.
00:01:44.460 And we don't really know the full effect of that.
00:01:46.980 And, you know, the bond dealers, which Gary mentioned, you know, inventories are much smaller than they used to be, partially because of rules and regulations.
00:01:54.060 And you are going to see a crack in the bond market.
00:01:58.640 Okay?
00:01:59.180 It is going to happen.
00:02:00.720 And I tell this to my regulators, some of you who are in this room, I'm telling you it's going to happen, and you're going to panic.
00:02:06.140 I'm not going to panic.
00:02:08.120 We'll be fine.
00:02:08.800 We'll probably make more money.
00:02:10.420 And then some of my friends will tell me that we like crises because it's good for JPMorgan Chase.
00:02:16.260 Not really.
00:02:17.400 You know, I tell people in credit suites who went bankrupt at the First Republic, it was terrible for the banking industry.
00:02:22.640 I think we can make everything better, including that, by just changing and modifying certain rules and regulations, letting market makers intermediate more in the market.
00:02:30.920 But to give you a number, like just JPMorgan alone buys and sells $3 trillion a day.
00:02:37.760 And we move $10 trillion a day of money.
00:02:40.380 And we're probably a tenth.
00:02:42.220 So the money moving around the world is $100 trillion a day.
00:02:45.820 The money moving around the investments, you know, this is stocks, bonds, corporates, governments, derivatives, credit, you name it, FX, sovereign debt around the world, $30 trillion.
00:02:55.800 The people who set those long-term rates are those people, including you in the room.
00:02:59.900 It's not the Federal Reserve.
00:03:01.540 They can try to manipulate the long-term rate.
00:03:03.380 They can do the, what's it called, you know, they do the twist or whatever.
00:03:07.180 It doesn't work for that long.
00:03:08.820 So if you look at economic history, bad things happen.
00:03:11.980 When those tectonic plays shift, it's very hard to see in real time.
00:03:15.580 It is shifting, and this is one of them.
00:03:17.620 I just don't know if it's going to be a crisis in six months or six years.
00:03:20.880 And I'm hoping that we change both the trajectory of the debt and the ability of market makers to make markets.
00:03:27.060 And also, remember, there are a lot of people, you know, going down to Washington who actually like bad markets.
00:03:34.620 You know, and the problem with the bad markets isn't that it's bad for the big banks who make markets.
00:03:38.840 It's bad for the people who raise money.
00:03:41.000 Small businesses, asset-backed securities, middle market companies, corporations, United States government.
00:03:46.480 And that volatility scares people.
00:03:47.720 You can pause it right there.
00:03:48.440 He almost said it, but he didn't want to say it.
00:03:50.060 Of course a bad economy helps these guys out.
00:03:52.260 But didn't they buy up a couple companies last time?
00:03:55.180 And, you know, anyways, Brandon, your thoughts on this?
00:03:57.820 Yeah, he's saying the bond market's going to crack.
00:03:59.720 I don't know how we could say the bond market's not cracked already.
00:04:01.800 Like, I don't think it's a normal thing at all for the Federal Reserve to own $20 trillion worth of bonds and mortgages just to keep interest rates at a normal level.
00:04:08.540 And, like, then with them having that, they're still having a hard time keeping them normal.
00:04:11.980 And like he said, yeah, it is mostly the, like, private investors that move the bond market around.
00:04:16.100 They say it's the smartest money in the world because it's, like, the biggest pile of money in the world.
00:04:19.280 But, yeah, it's because this is because Trump's showing no semblance of any interest in reducing the deficit and, like, reeling in spending.
00:04:26.640 They keep talking about this $500 trillion of assets that America has. 0.83
00:04:30.220 But, you know, like, show that first before, like, putting this stupid bill forward that's going to put us into more debt that has no interest in saving money or reducing what we're spending. 0.99
00:04:38.680 And then Doge was a disaster, a complete failure. 0.99
00:04:41.220 Maybe they baked that into a degree when he promised a trillion or two trillion.
00:04:45.240 So, yeah, of course, like, it started falling apart when he proposed that bill when it looked like that bill was going to pass.
00:04:50.740 And, yeah, I'm right there with him.
00:04:52.680 I'm super disappointed that Trump is showing no interest in really in the national debt.
00:04:56.920 And I think it's disastrous for everybody.
00:04:59.160 Two questions for you, Tom.
00:04:59.940 One, how bad is it that our rating is now AA Fitch, Moody, and S&P?
00:05:03.800 And what are your thoughts on what Jamie Dimon said in this clip?
00:05:07.580 Well, I'll break it into three parts.
00:05:09.040 First of all, the rating agencies just said what has been a reality for the past five years since that $20 trillion was suddenly stacked on top of the debt.
00:05:19.260 What are they today, 36.5?
00:05:21.280 Yeah.
00:05:21.620 Is that the total national?
00:05:22.660 Almost 37, yeah.
00:05:23.640 Almost 37.
00:05:23.960 Let's call it 37.
00:05:25.260 37 trillion in debt.
00:05:27.140 So the rating agencies just did what should have been done probably five years ago when the only path forward is they raise the debt ceiling.
00:05:37.640 That's the only path forward.
00:05:39.280 Why?
00:05:39.880 Because the yields are at 4.5% right now.
00:05:42.120 So you take 37 trillion times 4.5%.
00:05:45.520 That's your mortgage payment of the United States of America that's in the federal budget.
00:05:49.940 And so now you have this perpetual momentum machine, Pat, where, oh, well, I can't hardly afford the minimum payments on my credit card.
00:05:58.180 Don't worry.
00:05:58.940 We'll do a debt consolidation loan.
00:06:00.580 We'll put your two credit cards together on a slightly, just a little bit less interest rate.
00:06:05.080 And then you pay.
00:06:05.760 That's the momentum we were up.
00:06:07.260 So what is Jamie Dimon talking about?
00:06:09.460 He's saying, hey, look, at some point in time, this is going to crack.
00:06:12.340 And when it cracks, there's going to be buyers.
00:06:13.980 There's going to be sellers.
00:06:15.320 And he came out and say it.
00:06:17.420 Oh, this was bad for the banking industry.
00:06:19.880 This was horrible for the banking industry, except it was J.P. Morgan that picked up all the good parts when Humpty Dumpty fell and broke when he's talking about First Republic, right?
00:06:29.260 They came in. 0.60
00:06:30.100 Hey, you know those – not the commercial stuff here.
00:06:32.760 Here, this stuff here.
00:06:33.760 Yeah, we'll take that and we'll pay this and we'll pay that so they could help clean up the bankruptcy so it wouldn't be a full federal bailout.
00:06:39.880 So Jamie Dimon was right and he was honest about the fact that he benefits.
00:06:45.040 But he was also honest about the fact that we have not had a full settling of the $20 trillion that we added to our debt in four short years.
00:06:54.400 Actually, it's four, not five.
00:06:56.280 And so – and we're now – the yields are going up.
00:06:59.620 So now we're paying 4.5 percent interest on that, which is making it worse, which is why they keep raising the debt ceiling and getting even more debt because they can't get the budget through Congress.
00:07:10.000 And so I share Brandon's concern.
00:07:11.980 It's like, wait a minute, in the big, beautiful bill, I thought we were supposed to have some big, beautiful cuts.
00:07:16.700 We'll talk about the big, beautiful bill.
00:07:18.260 I want to show you this, though, Rob.
00:07:19.620 Can you play the other clip by Jamie Dimon?
00:07:21.280 It says, instead of stockpiling on Bitcoin, you should be stockpiling in bullets and – yeah, if you can play this clip.
00:07:27.160 To that point, do we need to rethink what constitutes national security?
00:07:32.500 I wouldn't rethink it.
00:07:33.480 We know what constitutes national security.
00:07:35.640 We need – you know, I was saying we shouldn't be stockpiling Bitcoin.
00:07:38.400 We should be stockpiling guns, bullets, tanks, planes, drones, you know, rare earths.
00:07:44.340 We know what we need to do.
00:07:45.460 This is not a mystery.
00:07:46.400 Did you say stockpiling Bitcoin?
00:07:48.460 I said we shouldn't be stockpiling Bitcoin.
00:07:50.280 Oh, it shouldn't be.
00:07:51.260 Okay.
00:07:51.640 We should be stockpiling bullets.
00:07:53.840 Okay.
00:07:54.400 Like, you know, the military guys tell you that, you know, if there's a war in the South China Sea, we have missiles for seven days.
00:07:59.380 That's correct.
00:08:00.000 Okay, come on.
00:08:01.260 I mean, we can't say that with a straight face and think that's okay.
00:08:04.080 So we know what to do.
00:08:05.340 We just got to now go about doing it.
00:08:07.220 Adam, thoughts?
00:08:08.640 There's so much to unpack here, and this is the number one issue for, at least for me, is as amazing as America is, as the opportunity economy or any, you know, the land of opportunity, we are freaking broke.
00:08:21.620 If this was any household in America where you have this massive income, amazing income, right?
00:08:31.340 But then, by the way, don't look over here.
00:08:32.920 You're running a $2 trillion deficit every year.
00:08:36.640 What the hell would you do in your house?
00:08:38.340 Chapter 13.
00:08:39.020 Chapter 13, file for bankruptcy.
00:08:41.800 We're going to sell one of the cars.
00:08:43.360 Nope, nope, nope.
00:08:44.360 Sell the boat.
00:08:45.100 Pull the kids out of private school.
00:08:46.660 We're not eating out.
00:08:48.420 It's ramen noodles.
00:08:49.380 It's soup.
00:08:50.320 We're holding down the fort. 1.00
00:08:53.500 We got to get this shit together. 0.99
00:08:55.740 And unfortunately, the U.S. right now is just like, nope, keep spending. 1.00
00:08:59.720 There's this big, beautiful bill.
00:09:00.940 It's big.
00:09:01.420 It's beautiful.
00:09:02.480 Elon Musk, who just left Doge, came out and said, well, it can't be both.
00:09:06.520 It can either be big or it can be beautiful.
00:09:09.100 But it's going to be very hard to be big and beautiful.
00:09:11.640 So, you know, Trump, I would hope, doesn't add more to the deficit, doesn't add more to the debt.
00:09:17.260 But you just said that Doge was an astronomical failure.
00:09:20.960 Yeah.
00:09:21.840 We'll see what happens with that.
00:09:23.960 There's a lot to say about what Elon Musk is talking about with his black eye.
00:09:27.240 But remains to be seen.
00:09:28.900 So, if you believe the future looks bright and you live in Florida, Texas, California, or New York, in that order, by the way, of the hats, the hats are available for your state where you get to where the future looks bright and on the site has your state on it.
00:09:44.620 I think the Florida numbered hats, there's three left on the numbers for Florida.
00:09:47.840 But the rest of them, there's a few left for you to go order, Rob.
00:09:51.380 Do you have a video on this or no with the hats?
00:09:53.180 Yep.
00:09:54.300 Press the video on this here.
00:09:55.380 You can go ahead and play it.
00:09:56.360 And it tells you, so on the cover it says future looks bright, vitamin logo on the other side.
00:10:01.300 You got Florida, California, Texas, and New York.
00:10:05.800 If you're proud of your state where you live in and you believe the future looks bright, go sport it.
00:10:12.040 And by the way, we got emails from people saying, how about our state?
00:10:15.340 How about this?
00:10:16.020 How about that?
00:10:16.880 Look, we even had a couple guys that ordered the hats and sent it to people that live in Texas, New York, California, Florida.
00:10:22.080 And a lot of good commentary.
00:10:24.200 I was tagged on a bunch of different gifts that people got.
00:10:26.340 So go place your order.
00:10:27.120 Go to vtmerch.com.
00:10:28.080 Place the order for the hat that represents your state.
00:10:30.200 Or buy it as a gift for somebody that lives in those states.
00:10:32.360 If you enjoyed this video, you want to watch more videos like this, click here.
00:10:35.080 And if you want to watch the entire podcast, click here.
00:10:37.860 Bye.
00:10:38.860 Bye.
00:10:39.860 Bye.
00:10:40.860 Bye.
00:10:41.860 Bye.
00:10:42.860 Bye.