 Good day, fellow investors. I recently received a lot of emails and in your comments, there was a request for me to comment on Andre Jicks' video about the massive crash coming ahead, an interview with legendary investor Raoul Paul. So they say, in short, and why the video got 400,000 views is probably the reason because they are telling you that you can invest only 5,000 into bitcoins and then over an uncertain period of time. By doing nothing, just putting your millennial hard earned, all the money you have, 5,000 by just investing that over a period of time, you are not going to be at 10,000, you are not going to be at 100,000, you are going to make a million by investing in bitcoins. Where am I? This is 2 times 500,000, that's a million. So that's the magic I'm going to discuss today. We're going to invest 5,000 and magically turn it into a million. If you want to be a serious person, we have 50 million here. So if you want to become a billionaire, then we can talk billions too, but that's for the big boys. Let's discuss the notion of what's going on with the economy, macroeconomy, 5,000 into a million. Let's make you millionaires for starters. Now apart from the jokes and the magic, the video is very interesting because it touches on a lot of subjects. The macroeconomy, how is that going to impact the stock market? The main trends into what people invest in? How you can hedge yourself, protect yourself by investing in bitcoins? How those are the best way to save? This is quoting what Raoul Paul says, how the stock market doesn't always go up, how the Japanese market didn't go up since 1989. Very interesting topic. How baby boomers are going to sell their stocks and therefore put pressure on the stock market and therefore after the crash coming from the upcoming recession, the market will go sideways for a long, long time. And also discussing a little bit what does it mean, microeconomics, how to predict the market and then just give you my commentaries on what's going on even on the Bitcoin and I'm guessing you will be surprised by my commentaries because we are discussing here Raoul Paul who is a macro hedge trader economist looking at the chart, trying to connect the chart and fundamentals, which is something very interesting to do. But then he comes out on YouTube telling people to invest all their money they have usually like millennials that they invest 5000, simply forget about it and they will become millionaires. And that's something very dangerous because trading is one thing. You need to know the right time to go in and even better you need to know the right time to go out. Let's start discussing the content. So let me start by giving you a summary of the topics discussed in the video. So the Doom loop explains baby boomers will start retiring, the average year they are now is 66, they will start selling the pension funds to fund their retirement. The pension fund is invested in the stock market and the credit market and that will put a lot of pressure. All fine, that is when stocks go up until the economy hits a recession, setting off the doom loop. So corporations will stop doing buybacks because they have been the only buyer of stocks over the last years, baby boomers are selling their stocks to fund their retirement, nobody is buying stocks right now so doom and gloom ahead. Also pension funds have to sell stocks, buybacks aren't there due to low cash flows in recession, nobody pays taxes so no buyer of bonds except for the Fed stepping in and the Fed stepping in recently stopped the entire pension system from blowing up. There is again a group of people with all the assets, what should be fair is that those with those assets, the old ones give the assets to the millennials or the stocks go lower so that millennials can buy those assets at lower prices because millennials are stuck with record high valuations, 0% interest rates to make money from bonds and real estate at all time highs. So as a millennial with your $5,000 what should you do well investing in Bitcoin because the economy will get worse, there will be a debt correction in solvency crisis. Millennials will lose their jobs so better have your $5,000 in bitcoins, young people are angry and they are opting out of the system, let's find the system by using TikTok which is escapism. The solution, well don't invest in stocks, don't buy real estate or buy your house and pay it off immediately if you have a career but if you have $5,000 and the risk reward is very attractive of putting it all into bitcoins because what's the point of putting it in stocks because you can put it all in crypto, forget about it and become a millionaire. This is very dangerous but he, Ropal is a hedge fund trader, been in the industry, no Soros, Drucker Miller everybody, theory of reflexivity and we'll see why he is promoting the Bitcoin and what you have to be careful if choosing that strategy. To each his own strategy I'm not saying anything against it, I'll just explain the pros and cons and add a little bit of perspective on the theories explained, that is what we are here. So to sum up you can invest $5,000 of your money into bitcoins, the worst you can happen is you can lose half of it so you can lose $2,500, the best that can happen you can become a millionaire, alright? Let's start with the explanation and the topics and then we'll see about counting all the money in the very, very long term, we are all going to be billionaires, millionaires, trillionaires, it's so easy, just put the money there and let the magic of finance do its work. Let's start with explaining, giving a bit more of perspective on all the topics discussed. God I'm so rich. So another thing that's very dangerous is the heuristic basic. So heuristics is where we as humans are wired to explain things in the easiest way possible. So easy, okay we don't want to reach mental overload and we want to pick the easy solution. The easy solution is invest in the Bitcoin, put all my money there, forget about it and in 10, 20, 30, 50 years I'll be a billionaire. Remember there is always more data to research and on the doom loop the fact that baby boomers retiring will be pushing the SAP 500 down by 50% or something like that. I remember writing an article making a video a year, two years, three years ago about that how boomer retirement based on publications from economic research from the Federal Bank of San Francisco how they predict headwinds for the US equity markets in 2011 due to baby boomers retiring and the theory goes as follow. So that's what they are using probably. So historical data indicates a strong relationship between the age distribution of the US population and stock market performance. As they reach retirement age they are likely to shift from buying stocks to selling their equity holdings to finance retirement. Statistical models suggest that this shift could be a factor holding down equity valuations over the next two decades. This is the PE ratio and the middle age to old age ratio and you can see how it is correlated. So when price earnings ratios were low the ratio between middle age to old age was also low because there were a lot of people retiring so many selling stocks more than buying stocks. When there was more middle aged person making money there were more buyers of stocks and the price earnings ratio went up. So that's the theory however this was the prediction and you see what happened. The actual prediction was completely off over the last 10 years since 2011 till now. The SAP 500 just went up price earnings ratio is much higher than it was predicted. It was predicted that it will go to 9 because of what happened. However let's add a few facts more and then you see ok Warren Buffett says interest rates are like gravity in valuation. If interest rates are nothing values can be almost infinite. Interest rates are like gravity on stock prices. So to the chart back stocks went up because interest rates went down and you compare values to what bonds are yielding to what you get on your savings account and over the past 40 years interest rates have been going mostly down thus stocks have been going mostly up in valuation. Also in the 1960s interest rates were low, valuations were high that changed in the 1970s and then we are back at high valuation since the 1990s. Second theory, second topic is debt is sky high. We are at the end of the debt cycle. Governments print money to ease debt payments, bond holders lose, assets go up. So I have discussed this recently in a video talking about Ray Dalio and his views on debt and his views is that there is going to be a lot of money printing and that's going to push stocks actually up, not down. So that's in contradiction with what was the situation there and we have seen that since the Fed started intervening despite we are entering into the biggest recession since the Great Depression 80-90 years ago stocks have gone up and have been going up even today as I'm filming this on Monday evening stocks have been also up. And this is now very important from a macroeconomic perspective. You can choose to either invest from fear or from positivity. Now investing from fear means investing into Bitcoin, Gold, Cash, running away from everything else that everybody else is investing and has been investing for a very long term because you want to time the market, you want to make the big bet in life and you want to win by doing such a bet let's say invest 5,000 become a millionaire by investing in Bitcoins because that's the best of bet of your lifetime and that's one way of doing it. The other way is being positive, recessions have been always there, it go up and down, money loses value all the time because that's how it's created. If I buy good assets, good businesses, good real estate, I can accumulate wealth over time. That's what we are doing on this channel. So if you're thinking long term, if you want to invest compound, not make the bets of your lifetime then this is the channel for you and subscribe to this channel also perhaps it will give you a different perspective on life. However, please be careful with short really to the point stories that are selling you something by telling you exactly what you want to hear, invest 5,000 become a millionaire, the rich are taking advantage of you, poor millennial, you have to buy everything expensive etc etc because there is always another side of the story. So predicting recessions from fear, you will be right one time in 7 years, the gray columns on this chart that I used again the federal funds rate, those are recessions and those happen on average every 7 years. If we look at the cycles, so recessions last a short time on average in the last 70 years 11 months and expansions lasted almost 60 months. Things were happening faster in prior times in history but if you look at the bottom line you see okay this is what happens in recessions and okay if you invest based out of fear, gold, bitcoin etc you will probably do well in those recessions but this will be the long term outcome because you will not do well in the other 6 years when things go good. One dollar invested in 1802 Jeremy Segal stocks from the long run would now become 700,000 dollars, gold one dollar would be after 200 years 4.5 dollars, bonds a little bit like a little bit better and bills a little bit worse. So that's investing, inflation would eat up a lot of your dollar especially since it was de-pegged from gold. This is investing, you have to see where you want to be, stocks annualized return over time 6.6% and that's already also what you can expect from stocks now and you have to see whether other asset classes will do better. Perhaps short time but that's betting and then you'll see how you react to betting also something very important. Now on the topic that stocks don't always go up comparing the stock market in Japan this is the stock market in Japan, 1989 there was the bubble and since then stocks never recovered but look at the long-term line, long-term line stocks did go up, did pay dividends, did grow, did compound and there are pretty rich people in Japan too. No matter the huge boom that happened in the 1980s. Price earnings ratio 1988-89 was above 50-60 even 100 for some companies that's why stocks didn't beat their previous highs not because of other things but because the price earnings ratio was sky high and now the price earnings ratio is pretty low with price earnings ratio hitting rates of below 15, below 20 for many Japanese companies. In Europe similarly they say the stock market didn't go up since 2000 well it didn't but look at what it didn't since 1986 so it depends on valuation, price earnings ratio in Europe, in the UK, in the US price earnings ratio were above 20-25 in the 2000s with the dot com boom especially. Now Bitcoin as an investor when I look at bitcoins I see no dividend I see no yield no use using in transactions I never bought or never was paid with bitcoins it's not an option easy maybe it will be in the future okay there is 16-18 million of it going to 21 million and that's it and that means okay Bitcoin it depends on how somebody else will pay how much somebody else will pay for that in the future so if you buy it now for where is my 5,000 oh I'm sorry I have already or only millions if you buy it now for 5,000 the fact that somebody will buy it for a million later that only depends on the other person 20, 30, 50 years from now and what happens to the Bitcoin so that's betting it's not investing and if you decide to bet you have to do it properly like traders Goldman Sachs X traders do it and that's based on something called trading charting George Soros was the legendary investor there Stanley Drucker on Mirol and let's dig into the strategy with bitcoins a bit more so a former hedge manager retired at 36 give his outlook for 2006-17 and explains why a recession could be on the horizon yes recession came 2020 but not because of predictable things but because of unpredictable virus related things and then now recently he started selling the idea of one million Bitcoin price level and in just three years and it's the biggest trade of our lifetime so better put our money on bitcoins be careful don't pick the easy solution understand what's going on so you as millennial have been tricked by the boomers what's the best investment out there easy you invest 5,000 yes you can lose 2.5 thousand but you can be a millionaire too that's such an easy thing to sell to the youtube millionaire audience be careful about that and then very interesting I always research okay who is telling me the story so 2019 2020 he really promoted Bitcoin so when those were cheap so probably those that followed did make a lot of money as the price of the Bitcoin went up but 2018 so just two years ago a one year and a half the same person was telling how it reminds him of the dotcom in 2000 great ideas float business models but eventually out of the age ashes the phoenix rose so it's all about timing here and nailing the right timing and what's going to get out of that now he pivots on that hard on bitcoin and that's where you have to invest your money I'm read here an article what is the reasoning behind that so he moved 25% of his portfolio to Bitcoin recently because it's a huge societal change that's coming from all of this virus the largest insolvency event in history is going to happen the great depression will come within months that's his prediction therefore there are the printing of money with all the stimulus packages that donald trump signed two trillion now again probably another half a trillion etc and his portfolio is repositioning at 25% bitcoin 25% gold 25% cash and 25% for trading opportunities the situation current situation with the coronavirus will be the biggest economic event of our lifetimes and therefore we should put our money into bitcoins and this is a chart I really want to discuss with bitcoins behaves the opposite of the stock market so it goes up extremely fast as speculators are running in to catch the wave up then as it has to stop at some point due to exuberance and people start selling then it goes slowly slowly down the stock market does the opposite it goes slowly slowly slowly up and then people selling panic here people buying panic because it should be a hedge against whatever goes on with monetary policy then when it starts to go up it goes up very fast and then it goes down again so if this crisis continues we can see bitcoin going up very fast if people start buying it like crazy and that's the only option out there however I'm not really agreeing on the fact that it is the only option out there I would say that it doesn't produce anything it doesn't have a dividend it doesn't have a yield I cannot land it out the banks don't land it out so might be something in the long long distant future it might not thus it's a bet and therefore you need to be a speculator to do that bet or you are an investor and you do other things and that's my conclusion here at some point the millennials buying it for five thousand ten thousand nine now we'll start selling it who will be the buyer governments perhaps why to make the millennials rich so they're going to buy your bitcoins perhaps you never know what can happen in this crazy world but you're speculating on the greater fool somebody that will pay much more to take you off your bitcoins and give you dollars or some other currency that you are aiming for so while you're buying one bitcoin and ten years later you will sell one bitcoin and you hope that it will give you a million dollars that from your invested ten thousand so you're again hoping of making a lot of money in dollars not bitcoins so you're not hoping of oh i'm going to invest one bitcoin i'm going to end up with 20 30 bitcoins and that's a very tricky situation that's a very tricky strategy to bet your money especially if it's all of your money and now somebody says oh but if i just lose five thousand is nothing let me show you this this is from sequoia fund just was researching google the top position and this is ten thousand invested 50 years ago it became much more than a million so four million so five thousand was two million sap 500 again five thousand seven hundred thousand over 50 years this is the stock market you can do better you can do a little bit better and yes you can turn 5000 into millions by investing too so if you're an investor stick to this channel if you are not an investor if you are a speculator and you want to speculate on bitcoins you want to speculate from fear you want to protect yourself with gold with bitcoins with cash well do that if it fits you but i have seen so many that did that bet in 2011 on gold and waited years just to break even and they are fortunately for them breaking even now nine years after nine years that we have doubled triple our money so that's investing versus speculating to each his own but i'm happy to share my thoughts here and i hope that see that people see the danger of speculating versus the long-term benefits of investing thank you for watching and looking forward to your comments subscribe click the notification bell and i'll see you in the next video