Chris Gure, Investment Consultant: How Wealth Advisors are Explaining Crypto

Chris Gure manages the finances of various wealthy families and advises on their investment portfolios. In this conversation, Chris and Anthony Pompliano discuss portfolio construction, the macro economy, the psychology of money and investments, and how Bitcoin is currently perceived by his type of client. BLOCKFI-----BlockFi allows you to keep your crypto, put it up as collateral, and receive a USD loan funded directly to your bank account. They do loans ranging from $2,000 to $10,000,000, and they're perfect for helping you reach your financial goals of all sizes. Visit BlockFi.com/Pomp to learn more about putting your crypto to work without having to sell it. CRYPTO. COM-----Crypto.com is a pioneering payment and cryptocurrency platform that seeks to accelerate the world's transition to cryptocurrency. With the vision of "cryptocurrency in every wallet", the Crypto.com App offers a full range of financial products with competitive pricing, well designed UX and high security. It is the best place to buy, sell and pay with crypto. COINMINE-----The Coinmine One is like an Xbox that turns your electricity into Bitcoin. You just plug it in, connect to wifi, and tap on the crypto you want. It’s so easy anyone can do it. Everything is controlled from the Coinmine mobile app and the Coinmine keeps getting better with over the air updates that add new coins, features and services to your Coinmine. Visit coinmine.com/pomp to get a Coinmine and earn crypto for powering a new world. ETORO-----This episode of Off the Chain is sponsored by eToro, the smartest crypto trading platform, and one of the largest in the world. Join 11 million other traders and create an account at etoro.com and build your crypto portfolio the smart way.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Anthony Pompliano?

  Whoa. Before we get started, I want to go over the four sponsors for this episode who make all this possible. They're fantastic, so go show them some love. The first is the best URL in the industry, crypto.com. They're a crypto platform with one goal: driving mass adoption. That's why we're all here, right? To get every human on earth a digital wallet and to get them using digital currencies. Crypto.com is helping people do that through buying, earning, lending, and a new card payment. Everything you could want is at crypto.com. They've been longtime supporters of Off the Chain and recently announced a new exchange, so go help them out, download their app from the App Store, or visit crypto.com and tell them POM sent you. There's nothing better in the world than a company helping to drive global adoption of this new technology.

• 0:44Anthony Pompliano?

  Another part of global adoption is making sure that we secure the various blockchains with computing power. CoinMine has built the best consumer experience in mining, hands down, no competition. If you want to help secure the blockchain and get started in mining, you can go to coinmine.com/pom, order a CoinMine, it'll arrive at your door, and you simply take it out of the box, plug it in, and connect to your wifi. You'll be mining your favorite crypto in five minutes or less. It is honestly magical. I have one running right now here in the office, and it's super quiet, it's got no heat, and every person that comes in the office asks, "What is that?" Every single person asks. It's a CoinMine. The best part to me is that the CoinMine comes with a mobile app that's super slick, and the company continues to push over-the-air updates to the device

• 1:25Anthony Pompliano?

  that add functionality, add tokens that can be mined, or increase the efficiency of the device. Similar to how Tesla does car software updates over the air, CoinMine is sending these passively to thousands of CoinMines around the world on a periodic basis. Pretty damn cool. When Farboot and the team pitched me on the idea of an Xbox or PlayStation-like box that could mine cryptocurrency in your home, I was immediately sold. I invested in the business, have a device personally, and keep telling people to go to coinmine.com/pom so they can save a lot of time if they want to get started mining today. CoinMine has a partnership with our third sponsor for this episode, BlockFi. BlockFi is one of my favorite companies in crypto because they allow users to deposit their assets in a deposit account and immediately start earning interest.

• 2:07Anthony Pompliano?

  Think about it, if you keep your digital assets on an exchange or in cold storage, you aren't benefiting from any yield on the asset. With BlockFi, they allow you to deposit crypto and then get paid interest on a monthly basis in crypto. Deposit Bitcoin and want to get your interest payment in ETH? You can do it. Deposit Bitcoin and want to get your interest payment in Bitcoin? You can do it. The rates at BlockFi are currently some of the best in the industry. You can earn 6% interest on Bitcoin and you can earn up to 8.6% APY on GUSD deposits. I'm an investor in the company and think BlockFi is building really important and compelling infrastructure. So go check them out at blockfi.com/pomp. Again, that's blockfi.com/pomp. And that brings us to the last advertiser of the episode, eToro.

• 2:51Anthony Pompliano?

  These guys have absolutely crushed it over the years. Their founder, Yoni, was one of the original Bitcoin OGs and has been ahead of almost every trend in crypto. He built eToro to help people buy, sell, and trade cryptocurrencies. But he added a few twists: social trading, copy trading, and virtual trading accounts. Social trading is a feature where every asset available on the platform has its own separate social feed where people talk about the asset, share trading ideas and analysis, and even include various charts or graphs. Virtual trading accounts is targeted at beginners. If you're just starting out and want to try trading with play money, eToro will give you a virtual account with $100,000 in it to test, learn, and get comfortable. And so, then that brings us to copy trading, which is by far the coolest feature. This allows you, as a user, to select any other user's portfolio to copy.

• 3:36Anthony Pompliano?

  If you see someone on the platform you like, you can set your account to mimic their trades. They buy Bitcoin with 5% of their portfolio? Your portfolio buys 5% Bitcoin. They sell 50% of their Ether position? Your portfolio does the same thing automatically. Copy trading is awesome, so go join the 10-plus million other traders on eToro and start trading all the most popular cryptocurrencies today. They're one of the largest companies in the space and you can get started by going to etoro.com. Again, that is etoro.com, where the entire team is ready to get you started in just a few clicks. And don't forget, go subscribe to the Off the Chain daily newsletter. You can go to offthechain.substack.com. I write a letter of news, analysis, and opinion every morning that goes out to more than 40,000 investors. See you there.

• 4:22Anthony Pompliano?

  What's up everyone, this is Anthony Pompliano. Most of you know me as Pomp. You're listening to Off the Chain, simply the best podcast in crypto. Let's kick this thing off.

• 4:33Anthony Pompliano?

  Chris Gore manages the finances of various wealthy families and advises on their investment portfolios. He has also been incredibly helpful to me in retirement planning and was the individual who originally introduced me to Mark Yusko and Morgan Creek. So I wanted him to come on the podcast and share his insights. In this conversation, we discuss portfolio construction, the macro economy, the psychology of money and investments, and how Bitcoin is currently perceived by his type of client. I really enjoyed this conversation, and I hope you do as well.

• 5:04Speaker 01

  Anthony Pompliano is a partner at Morgan Creek Digital. All opinions expressed by Pomp or his guests on this podcast are solely their opinions and do not reflect the opinions of Morgan Creek Digital or Morgan Creek Capital Management. You should not treat any opinion expressed by Pomp as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. This podcast is for informational purposes only.

• 5:30Anthony Pompliano?

  Alright guys, bang, bang. I'm sitting here with Chris. We got a whole bunch of stuff to cover. This is gonna be a really special episode, I think, because we're gonna get the perspective of a financial advisor, both in the traditional world, but also how clients currently are thinking about Bitcoin and cryptocurrencies. So thanks so much for coming to do this.

• 5:47Speaker 02

  No problem. Thanks for having me.

• 5:49Anthony Pompliano?

  No pressure, bro, no pressure. Alright, let's get into your background. We know each other for a long time, but go ahead and tell everyone what you did before the financial advising worked.

• 5:59Speaker 02

  Yeah, I graduated college and realized no one's gonna trust a 20 something year old kid with all their money. So I figured, need to go leverage the big brand names that were out there, see if I couldn't use them to get my foot in the door, speak with wealthy clients, talk about their financial planning. Went to a $5 trillion asset manager, used their brand name to open a bunch of doors, was working on retirement plans and financial investment portfolios for companies like Oracle, Time Warner Cable, big Fortune 500 companies like IBM. It was fun while it lasted, but had to move on.

• 6:37Anthony Pompliano?

  So like, what do you exactly do when you're doing like retirement planning for big organizations like that? Like, I get that people need the help, but like, what exactly does that work entail?

• 6:45Speaker 02

  Yeah, everyone really thinks that they're going to try to identify this number out in the distance where it's if I can get to two, three million dollars, I can retire. But just like you and I were talking about a minute ago, if you think about it backwards, there's this really interesting story about Tiger Woods, when he will go onto the golf course, he'll actually start at the 18th hole and walk backwards. So we can try to help clients identify everything that they're going to need in retirement, you know, how much money they're going to spend, doing the income planning first. We can walk that back to a realistic number on, hey, if you can save XYZ, or you can get your investment portfolio to this number, you shouldn't have any worry about being able to retire successfully.

• 7:26Anthony Pompliano?

  Yeah. And so like, what is the average number, would you say, most clients? You do a lot of work in North Carolina, so it's not in New York, San Francisco, but what's like the average number people are looking to save? Is it, hey, I need to get to a million bucks? Is it 10 million dollars? Like, where are they trying to get to?

• 7:44Speaker 02

  We work with a really interesting subset of clients. We work with about 40 households, manage right around 100 million dollars as an office. But for the average person, they need to have 1.2 million dollars in retirement. That's going to spit off 50,000 dollars a year of top line income. Couple that with social security, which we can, of course, get into, see if that's going to work out long term. I do, is the short answer. But couple that with any pension, social security, it should be all right.

• 8:13Anthony Pompliano?

  Got it. And so as you're sitting down with these folks, maybe let's go through kind of, somebody walks in the door as a new client, you basically say, all right, let's start at the end with the income planning on the retirement side. And then as you walk backwards, what are the things that you're trying to identify? And then how much of that is more tactical things versus more of like a mentality around either saving or investing?

• 8:41Speaker 02

  Yeah, we want to really do all of that tactical planning, all of this, you know, let's geek out on these financial plans, let's run the numbers to see if we can't break the financial plan down behind the scenes. We don't want to do that with clients. We think our interaction with clients is 90% behavioral focused. We want to understand your relationship with risk. You know, there's two ways to think about it. Clients will call us or coming off the street and the first thing they want to talk about is, you know, what's this hot stock tip? What are they talking about on the radio that's going to give me, you know, double my investment portfolio in six weeks? Generally, that's because they've done a poor job planning, they didn't save enough money.

• 9:24Speaker 02

  Now they feel like they need to take a lot of risk to get to their number to be able to retire. The flip side of that is, we have some wealthy clients who don't want to take any risk. They feel like they achieved their number, their goal for retirement, and now they want to lock it under their mattress and, you know, hope that the interest will pay for their retirement.

• 9:42Anthony Pompliano?

  Yeah, but basically, it's the difference between somebody who wants to get rich quick and somebody who's comfortable getting rich slow and disciplined.

• 9:49Speaker 02

  Right. And it's, one way to think about risk is, can I afford to take it? Can I afford to take this much risk?

• 9:55Anthony Pompliano?

  And so, like, explain that more.

• 9:57Speaker 02

  So, we were talking earlier, a lot of people, their mentality growing up, you know, think about our, our parents or our grandparents, who they were waiting in line for gas and bread, and they weren't able to, to get the things that they needed to go to work and live their lives. They have a really different relationship with money, where it's more of this scarcity mindset. Oftentimes, people were able to get jobs when they were younger, they have all these advantages from their parents saving all this money, they were able to take a little more risk. So now, the relationship with money is, hey, I have enough money in my bank account to pay all my bills for the next year. My main focus might be to keep saving, but what are you giving up? What opportunities are you missing out on by just having this money sit in your wallets and your checking account?

• 10:40Anthony Pompliano?

  Yeah, this is one thing that we talked about a bunch, where, if you think about it from a business perspective, right? If I have a profitable business, and let's say that my business is generating a million dollars in, in cash flow each year, and I just simply keep taking that million dollars and just putting it to the side, saving it in a bank account, one, obviously, inflation's eating away at it, but, but two is, that's a strategy of saving, but if you took that same million dollars of cash flow, and you had some way to reinvest those profits, and you could turn that million dollars into two million, three million, four million dollars, it would pay, quite literally, to continue to reinvest your profits into your business, but in order to do that and have the confidence to do that, you really got

• 11:25Anthony Pompliano?

  to have a pretty good handle on your business and understand the machine that you're building in terms of your return on invested capital.

• 11:32Speaker 02

  You're exactly right, and that's really what we see our role as. If you owned a successful business, you're going to have a CFO that you trust, who's the CFO for your business. We're the CFO for your household. And just trying to bring that down to something that people might understand, and that we've been talking to clients a lot recently about, is interest rates are extremely low. Let's talk about your mortgage for a minute. If you want to go buy a million dollar house, you're going to put, just as an example, $200,000 down, and the bank is going to lend you $800,000 at 3.5%, 4% right now. I mean, it's unheard of, the level of interest rate. If you leave that money in your savings account, you're making $2. Now, if you're comfortable investing that money, not putting 100% down on your

• 12:16Speaker 02

  home, what's the delta that you can make? If you're borrowing money, just the same way you put it before, at 3.5% from the bank, and your investments are kicking off an 8% return, you're making, you know, 5.5%, 4.5% on every dollar that you didn't put down to the bank. You know, you've just got to leverage someone else's money.

• 12:35Anthony Pompliano?

  Yeah. And so how does the mentality and kind of risk profile change with, let's say, age first, right? So if I'm a young 25-year-old who's just starting their career, I probably don't have as much wealth or assets, and I'm assuming the risk profile's much, much higher versus somebody who's in their mid to late 50s, who's got quite a bit of wealth, and is nearing the end of their career. Is that accurate, or do you find the opposite?

• 12:59Speaker 02

  Yeah, it is exactly true, what you're saying, and it's not always for good reason. You know, we grew up in this Instagram culture where people see all this wealth, and all this wealth is flaunted. Everyone drives a nice car, but what you don't realize is that they're leasing it. Thinking about some of our wealthiest clients, they drive cars that they bought 11 years ago, and they've never made a car payment in their entire life. But also, they're taking a plane that they own whenever they're going on vacation with their families. They're not posting that online, no one's seeing that. Versus the 25-year-old client who's driving the Maserati to his humongous house, who everyone knows about.

• 13:34Anthony Pompliano?

  Yeah. Well, it's also, a lot of that stuff is fake, right? It's rented cars, it's rented homes, it's all this stuff to really just like flex on people. Whereas, I think the difference is, you ever seen these memes online that are like, "The goal's to be rich, not to look rich"?

• 13:51Speaker 02

  Right.

• 13:52Anthony Pompliano?

  Right? Which I think is exactly what you're talking about there.

• 13:57Anthony Pompliano?

  And so let's get a little bit into, you know, from an individual's perspective, how do you guys think about portfolio construction and really talking about traditional assets outside of crypto? Like, what is that conversation like with the various types of clients you guys have?

• 14:12Speaker 02

  So when we're putting together any investment recommendations, we have the ability to go out and look at every investment vehicle under the sun. We want to screen it through our own process to identify, you know, is this, we'll just use public equities for an example, is this stock set to outperform for the next, you know, 12 to 18 months? One thing that we do that's slightly different is we outsource a lot of that value investing style that people used to love has not fared well last decade or so. This Warren Buffett type of investing, we use a couple of different research providers to do that book value and identify which stocks are set to grow over the

• 14:55Speaker 02

  next year. And we want to overlay that with technical analysis to see, hey, is this going to be backed by some tailwinds? Is there momentum that's on our side for this asset to rise and to rise quickly?

• 15:07Anthony Pompliano?

  What's the weirdest investment you guys have ever evaluated?

• 15:11Speaker 02

  The strangest story we had was, I think it was 2017, we invested in Weight Watchers and it was, over the last 20 years that Fortress has been around, the largest single stock holding in any portfolio.

• 15:29Anthony Pompliano?

  And what happened?

• 15:30Speaker 02

  The reason it became the largest single holding is because it more than quadrupled in value before we sold it. And we certainly did not time it at the very top. I mean, it would have been, you know, eight-bagger, I think, at one point, and we got out between four and six. But it made for a great year. Everyone had Weight Watchers memberships paid for for the rest of their life, I think.

• 15:53Anthony Pompliano?

  What is the, when you look at these investments, what do you guys do around alternative investing? Right? So not stocks and bonds, kind of your traditional assets, but the whole private equity, venture capital, even if we put real estate in there, etc. Like, how do you guys deal with that?

• 16:11Speaker 02

  So I hate that I'm going to tee you up perfectly. This is exactly what you want to hear, but it is the truth. And you guys worded it a little differently, and I do want to call you out about that. We're looking at alts as an asset class, which I don't think they should be described as that. But regardless, we want non-correlated market assets. So we are going to buy the S and P 500, which we're not doing as a general rule of thumb. We want to be able to balance that out with something that's uncorrelated. So our goal with all of our clients, who generally have made all of their wealth, or made a significant amount of wealth already, is to keep them rich forever. We're not going to make them rich overnight by any means. But if we can avoid this permanent impairment of capital by bringing the volatility of their portfolios down,

• 16:56Speaker 02

  by keeping them invested for the long run, by lowering their market risk, we're doing our job.

• 17:03Anthony Pompliano?

  How does Bitcoin play into that?

• 17:05Speaker 02

  Really, the compliance nightmare question of the century is how do you answer clients' questions when they are online, listening to you, listening to CNBC, talk about this day in, day out? And they're looking at it more often than not, unfortunately, as a, hey, I saw this thing go from a hundred dollars a few years ago to fifteen thousand dollars. And if I put in X amount, I'd have, you know, fifty X that amount now.

• 17:34Anthony Pompliano?

  And have you recently, so we're recording this in the end of 2019, the asset was as high as twenty thousand at the end of seventeen, drew eighty-five percent down, around three thousand dollars, and is now sitting, call it somewhere in the low seven thousands. Do you see interest kind of follow price? So in 2017, price goes up a lot, a bunch of people come in asking about it. Price goes down a lot in 2018 and everyone kind of goes away. As price recovers in 19, people come back and start asking again? Or was it a pretty persistent kind of interest level throughout all those price movements?

• 18:12Speaker 02

  No way. People are short-term biased. They're generally pessimistic. And really, one of the huge investment risks that's our job to help people avoid is people get anchored in their own history bias. So they heard about Bitcoin for the first time, what was it, two years ago now? When it was at the absolute peak. They bought it at Thanksgiving, Christmas, when their nieces and nephews were telling them that someone was screaming about it on Twitter. They threw in $5,000 or $10,000, something they thought they could afford to lose, sold it at the absolute bottom, and now they're kicking themselves ever since. That's when people get the most upset. Everyone wants to buy low, sell high. Really, it makes for a great coaster or a saying on a mug or a t-shirt.

• 18:57Speaker 02

  But in practice, it's a lot more difficult.

• 19:00Anthony Pompliano?

  And so those people today, where do you think their interest lies? Are they, hey, I bought the top and I sold it somewhere on the way down. I lost money. I don't ever want to talk about that thing again. Are they interested in it from a pure speculation standpoint? Do they maybe they've done more work and now they look at it as a technology and an alternative form of currency? Like, where do they kind of fall on that spectrum in general?

• 19:24Speaker 02

  People hate being wrong, and that makes for the worst investment strategy ever. So they want to be pessimistic. They want to see this thing go to zero. Because think about it, in their head, they bought at $20,000. Let's say they sold at $8,000. So they lost a little more than half their investment. But hey, if it goes to zero, it was still not the most wrong out there.

• 19:43Anthony Pompliano?

  Yeah, so basically, I'm the smartest of the dumb people.

• 19:45Speaker 02

  Right. And that's unfortunately how people generally invest.

• 19:49Anthony Pompliano?

  Yeah, and so

• 19:52Anthony Pompliano?

  You guys, and again, we should caveat like 100 times throughout this, this is not financial advice. This is just pure Chris's opinion, my opinion, and kind of a conversation around philosophy, but not investment advice. How do you think about Bitcoin as a non-correlated asset or asymmetric asset? Or is it more of, yeah, maybe that stuff's true, but it's just a speculative thing for right now. And so it's okay for people that want to get some exposure, but keep it really small and capped?

• 20:23Speaker 02

  I think people that are a lot smarter than us understand history and are able to identify over long periods of time that there have been these technological revolutions. And those have all been the keys to creating huge outside wealth, you know, things that are going to last through generations. And if this is the next one, I certainly don't want to be on the sideline. If this is going to be, what are people calling it? Internet 2.0, that this is going to power, you know, the future of 5G or whatever everything is based off of, how could you not participate in it? So admittedly, and full disclosure, I do own some of it. It's not enough that's going to, you know, make a huge difference in my portfolio in the near term.

• 21:08Speaker 02

  But hey, if you and these other loud guys on Twitter are right, I'll be cheering all the way.

• 21:15Anthony Pompliano?

  How's the macro economy playing into this? What do you think's going on there?

• 21:19Speaker 02

  This is probably what really plays to client conversations. So our average client, let's say, is 45 years old. They are a doctor, executive, have a $2 million portfolio with us, own a successful business that'll be a huge asset, you know, as part of their financial plan in the future. And their biggest concerns are generally around geopolitical events. Now...

• 21:46Speaker 02

  People really oversell to themselves the importance of these geopolitical events in the near term, or I should really say in the long term. Whoever lives in the White House this year generally is not going to have the effect you think on your retirement plan 40 years from now when you retire, or when you're thinking you could potentially run out of money. On the flip side, when you see these countries like Venezuela who have hyperinflation, who are completely corrupt, you see them going into the banks and just taking the money out, this is something to actually be concerned about. And I'm not saying that'll ever happen in the United States, but we do want to have international exposure to stocks and client portfolios, and this geopolitical risk does exist. There's no way to hedge it out completely.

• 22:29Speaker 02

  There is a really compelling argument to make with a currency that isn't backed by a country.

• 22:35Anthony Pompliano?

  And so, as you think about that macroeconomy, you talked earlier about interest rates being low. Obviously, there's, we can call it non QE or just QE happening. Do we see this stock market rally continue forever? Like, where are we in these cycles? And are you guys more of the thought that we're closer to the end than the beginning? Or do you think that it doesn't really matter what happens? You guys try to be prepared throughout any sort of macro environment?

• 23:08Speaker 02

  Yeah, we want to build out, just like I'm sure everyone does, you know, this all-weather portfolio that's going to help people feel comfortable. And the reality is that no one knows when the rally is going to end. And to guess what the S&P 500 is going to be next year and when it's going to peak is a fool's errand. We need to identify what level of risk you're comfortable taking well in advance of that, so that the next correction, the next recession, whatever it ends up being and whenever it ends up happening, is only a blip on the radar. Generally, these things... The bull market lasts seven to 10 years, then it's two, three years of contraction. Market cycles exist, there's no denying it.

• 23:51Speaker 02

  The key is to identify your risk tolerance beforehand. It's extremely difficult mentally to go through that exercise. We talk too much about what's going to happen and not enough about how we are going to react to it. That's where people make mistakes. We see people that were invested up and through the financial crisis in 2008, 2009. They got out of the market, they saw just enough to where they felt comfortable, they never got back in. And again, they feel like geniuses, but when you go back, you see that you missed an incredible unheard of rally, and they're the ones that are cheering for the next crash. Our clients that are younger, that 25 to 35, even older than that, they have really nothing to worry about. They have such a long time horizon in front of them.

• 24:36Speaker 02

  And again, people talk about, quote unquote, retirement age being in your early 60s. You still need to have money, and definitely, you don't need to stop making money as soon as you retire.

• 24:47Anthony Pompliano?

  Well, and I think that what we're seeing across just personal finance in general is this assault by technologists, where they're trying to build technology to automate away a lot of financial advisors' roles, banks' roles, other kind of financial service organizations, etc. How do you guys see, probably especially with the younger generation of clients, the role for those fintech platforms versus what people would consider more traditional advice and kind of help that you guys can provide?

• 25:24Speaker 02

  Yeah, we're very bullish on how technology can help us service clients. We want clients to be able to feel comfortable by logging in, seeing where their investments are all the time. Generally, our clients didn't grow up using the computers every day the way we did. Remembering these logins, these passwords, the different data that's important for privacy protection is going to create a lot of friction for them. And when they can't log in, all of a sudden, their worst fear has been met, and the money's gone. Reality, if you click forgot password, you'll be logged in in 15 minutes.

• 25:57Anthony Pompliano?

  Yeah. I always wonder if there's clients who literally just have cash positions because they're so scared of what's going on in all the products.

• 26:06Speaker 02

  You're absolutely right, and we love cash viewed as an asset class. It is an investment. I remember a story Mark told about what was like a nine-figure client had all of his money in one bank that I couldn't even pick out on a map. You know, these are insured up to 250,000. That's not really helpful when you have 100 million dollars.

• 26:28Anthony Pompliano?

  Yeah.

• 26:30Anthony Pompliano?

  Bitcoin, new global currency, or are you, you not there yet?

• 26:36Speaker 02

  Certainly not there yet.

• 26:37Anthony Pompliano?

  No? Why not?

• 26:40Speaker 02

  There are, we were in New York all last week together. I think we walked by two places that accepted Bitcoin. We walked past every place that except my American Express card. I'll give the American Express points the nod on global currency at the moment before Bitcoin.

• 26:59Anthony Pompliano?

  That's fair in the United States.

• 27:01Speaker 02

  True.

• 27:02Anthony Pompliano?

  Right?

• 27:02Speaker 02

  I'll take your word for it.

• 27:04Anthony Pompliano?

  I, I saw a stat from CoinMetrix, Nick Carter and those guys, that last year, 2018 Bitcoins adjusted on-chain transaction volume. So this is not exchange traded volume, and this is adjusted for things like mixers or exchanges, etc. Right? So it's doing its best job to figure out what is actual economic activity that's on-chain. With 750-plus billion dollars in 2018. And so if you compare that to Venmo, PayPal, or Apple Pay, Bitcoins on-chain transaction volume dwarfs those three.

• 27:43Speaker 02

  And these are people that are spending it on goods and services, you're saying? That's how they're?

• 27:46Anthony Pompliano?

  So that's part of the challenges. What exactly are they spending it on? Right? We, we don't know. But are they sending it, you know, me sending you money? Am I sending, spending it somewhere to actually buy a good or a service? Could I be moving it between two of my own accounts? It's really hard to tell what the purpose is. But just the fact that 750 billion dollars of transaction volume on-chain in some adjusted manner, you know, 750 billion dollars is a pretty big number.

• 28:17Speaker 02

  You know, it's really interesting. I got an email last week. What was that huge exchange that closed down? So this is back to your point about there are so many of these robo-advisors that are going to disrupt the industry of, you know, financial services, and I don't see it that way at all. No one wants to call 1-800 number ever again. When you need someone, you want to call someone that's going to pick up the phone. What's it like when you're trying to call Coinbase to make sure that your transaction went through?

• 28:46Anthony Pompliano?

  No phone number.

• 28:48Speaker 02

  That's concerning.

• 28:49Anthony Pompliano?

  But what you're basically getting at is this idea that as automation becomes more prolific and machines and algorithms start to get rid of the more mundane aspects of jobs and the less creative aspects of jobs, it actually makes advice and the creative components more valuable, right? So it's a thing where the machines are really good at doing a kind of work that is repetitive or somewhat mundane, and they're really good at like computations, etc. But in terms of the actual creativity, human ingenuity, right? And the advice component, machines are still pretty bad at that compared to the best humans. So I think that that makes that advice much more valuable over time.

• 29:33Speaker 02

  And it goes back to the, you know, who do you trust? And people are so concerned with keeping their identities safe and well-deserved concern over, you know, don't want to put your social security number in there. But I guess I've kind of have maybe a pessimistic view on this. I think if someone wants my information bad enough, they're probably just going to get it, no matter what I do, if I don't save my passwords. So opt me into automating everything. You know, I want every bill pay. I don't want to think about any of that.

• 30:03Anthony Pompliano?

  Yeah, I mean, look, if you go on the black market, I can definitely buy your stuff.

• 30:06Speaker 02

  You can have it for free.

• 30:07Anthony Pompliano?

  Right.

• 30:09Speaker 02

  Venom made 10 bucks, it's yours.

• 30:11Anthony Pompliano?

  For sure. And so what about like custody and other aspects of Bitcoin? So not just the asset itself, but like, let's say a client walks in and says, hey, I want Bitcoin in my portfolio. How do you guys think about the options to get exposure for that client? And what are some of maybe the risks or obstacles there that probably still exist today, but definitely existed two years ago?

• 30:33Speaker 02

  Yeah, we can't wait to see some of these big custodians like Fidelity add this on to, you know, the RIA chassis so we can have the option for exposure to it. There was a really, you know, for a moment, and this was over a year ago, we had clients calling in asking for that.

• 30:51Anthony Pompliano?

  GBTC?

• 30:52Speaker 02

  Yeah, that Bitcoin trust. When you look at it, it's trading or it was trading at what 30, 40% premium? So it's, hey, you're real worried about the fees and now you're paying a 30% premium on this asset? Okay. Well, like where exactly do you think it's going? How are you? You know, everything else you're talking about, you sound like a value investor, but now you're paying a 30% premium, really going against the grain of your investment policy here.

• 31:16Anthony Pompliano?

  Yeah. And so is it custody is the big obstacle once somebody decides they want it or are there other things?

• 31:22Speaker 02

  Custody and compliance are generally the big obstacles with all of this. And this is why I don't think the adoption is where everyone would like it to be yet. You're asking people who have grown up in a completely different age to adopt a new technology that I don't understand completely yet. I don't know if you understand it completely yet, but they don't understand it, you know, at an elementary level. And now you want lawmakers to make it comfortable for a trillion dollar asset change from, you know, the generation before us to us to say, hey, we want to put, what, what are you trying to do? 1%?

• 32:04Speaker 02

  That's still a lot of dollars and there's a lot of risk to, you know, congressmen and senators everywhere.

• 32:11Anthony Pompliano?

  Maybe, but if you look, I think, at the fiat system, there's more money laundering that goes on in the fiat system. There's way more risk, I think, in a fractional reserve system, as you see with things like the global financial crisis, etc., versus a bearer asset that is not participating in fractional reserve.

• 32:31Speaker 02

  What do they say about those pioneers?

• 32:32Anthony Pompliano?

  What?

• 32:33Speaker 02

  They get slaughtered. I want to bet on the people with all the money. So as much as disrupting the central bankers may be, you know, what's needed to adopt and grow and advance as a society around finances, I don't know if I want to bet against the guy who's controlling interest rates.

• 32:51Anthony Pompliano?

  Yeah, well, here's the, uh, one of the things that I've been spending a lot of time on is, so the creation of double-entry accounting happened in the early medieval times of the Middle East, is where most people think it happened, probably somewhere in like 70 to 100 AD, and then eventually made its way to Europe and was popularized by two separate folks. One was a merchant who started using it, I think it's around like 1300 AD, and then eventually, uh, one of the Medici family members started using it, the Medici Bank, and that's really kind of where it became super popular. And now, obviously, the entire global financial system is built on double-entry accounting.

• 33:32Anthony Pompliano?

  But that one single invention created a massive inflection point in human history. And so if you think about, there was single-entry accounting, then we got double-entry accounting, massive inflection point. I'd argue that triple-entry accounting, which is what a blockchain or Bitcoin as an application provides, could be an even larger inflection point in human history, simply because that triple-entry accounting system is now going to permeate the globe because it's being built on the back of the internet.

• 34:02Speaker 02

  Yeah, if you can innovate and you can, you know, we certainly believe that.

• 34:09Speaker 02

  Innovation is happening more rapidly than ever. This is a hyperbolic innovation that you're describing. If you're not on the front end of that, you're, you're gonna miss out.

• 34:22Anthony Pompliano?

  Yeah. What, what's the biggest mistakes you see, especially younger clients make? So let's call it sub forty years old. What are, what are the big mistakes they make?

• 34:32Speaker 02

  So I'm gonna talk out of both sides of my mouth a little bit here because it applies to different people. Generally, the issue for the masses is people are not saving any money. They're not putting any money away for a rainy day and eventually they're, they're gonna need it. And they're not gonna have it. I think it's, what is it, less than half of people could come up with like a $400 bill?

• 34:56Anthony Pompliano?

  Yeah, it's less than, or more than, I think it's just fifty percent of Americans can't come up with $400 for an emergency bill.

• 35:04Speaker 02

  Yeah, that's terrifying. And when you look at it from, you, you asked about younger people, but let me jump to the older people right now. One point two million dollars to retire is a pipe dream to most people. I think the average 401k balance is under $40,000. And people are gonna spend that in a year or two.

• 35:20Anthony Pompliano?

  Yeah. So what do those people do?

• 35:24Anthony Pompliano?

  Just keep working?

• 35:25Speaker 02

  Sad, sad reality. There's a

• 35:30Speaker 02

  there's only a few levers that you can pull. You can either

• 35:33Anthony Pompliano?

  Which are?

• 35:34Speaker 02

  Keep working, save more money, make more money, you know? Change your, your investment strategies. It's again, essentially a lever to make more money or, or use less. And it's a pretty morbid thought process.

• 35:48Anthony Pompliano?

  And, and is it a thing where the earlier you start, it's just compounding and time are on your side? And so, yeah, having better strategies, et cetera, helps, but, but it is just a thing of starting early gives you a massive advantage?

• 36:03Speaker 02

  Oh, my goodness. Humans are not that smart. And this is the easiest example on, on how to figure that out. Underappreciating the power of compounding is the, your biggest mistake that anyone can make. And the easiest way to put it, read this Bill Gates quote a while back. You know, you can ask anyone, like two times two is four, you know, ten times ten is a hundred. But ask them what seventeen times twenty-one is. That's the limit of our minds computing power. I don't, I don't know anyone that could do that without grabbing, my first thought would be to grab my calculator too. But that's when you're talking about this power of compounding. And when you can apply that to your money, it, the, you crack the code. It becomes rather simple.

• 36:48Speaker 02

  And the idea that people don't make enough money to save is, is just fundamentally incorrect. We were talking to hundreds of people a week, m- m- most of them making, you know, less money than, you know, our average clients now. And they still had successful retirements, but you can't overspend. You can't live beyond your means. It's not rocket science. It's just not what people want to hear.

• 37:14Anthony Pompliano?

  Yeah, it's basically, look, whatever you make, you gotta spend less, right? You gotta be disciplined in, uh, kind of executing a, an intelligent plan. And then you need to leverage compounding in time.

• 37:23Speaker 02

  Right, yeah, no, it's, uh.

• 37:25Anthony Pompliano?

  Like if I could figure it out, anybody could figure it out.

• 37:28Speaker 02

  It, it's based on percentages. So there's been huge, massive studies done. And you need to be saving 10 to 15% of your, at, your, you know, income per year. And this is if you're starting at like 25. So that's, that's the trick.

• 37:42Anthony Pompliano?

  Where, where does that get you? So, so let's say that you make, uh, $40,000 a year, basically. If you could save four grand a year, that puts you on track. And you do that year in, year out, since you were younger, where does that put you?

• 37:53Speaker 02

  Yeah, you'll be at 800,000 to, to a million dollars, assuming you have a realistic, long-term annualized rate of return, which is easier said than done. There's going to be some drawdowns. You're gonna need to stay invested. There's gonna be big dollar amounts later on in life. But that's going to be able to kick off the annualized salary that you're used to receiving in retirement. Cause things, things do slow down. Uh, generally, people spend about 80% of their take, or their current spending in retirement. Think things naturally go down. Your, your spending, you're not traveling to work, you're not buying new clothes for work every few months. There's just less wear and tear on everything.

• 38:33Anthony Pompliano?

  Hey man, you gotta have a fly outfit to go play bingo.

• 38:36Speaker 02

  If everyone switches to black t-shirts, that, that'll save them some money.

• 38:39Anthony Pompliano?

  Listen, I, i- it's a, it's like a uniform, man. What about taxes? We were talking earlier about a whole bunch of different tax strategies and stuff. Like, how important is it to take into account taxes? And you hear rich people all the time doing all kinds of crazy things to either from a perception standpoint or in reality, lower their tax burden or tax payments. Is that, one, actually helpful to those rich people? And then, two, kind of everyday people? You know, is it helpful to folks like us who want to? You know, they read about this stuff, but they don't actually know, like, should I be worried about taxes? Or is it just, you know, kind of the MTV version of the world?

• 39:20Speaker 02

  If you want to see someone lose their mind, or if you want to fill a room with people, tell them that you're going to save the money on taxes. It's the best, you know, financial marketing of all time. This is how you avoid taxes. Let me go on the record. You can't just avoid it without breaking the law. They're there for a reason. And when you go back and think about it, they're not all that bad. And historically, and the reason I'm saying this is when you look at the last, you know, forty, fifty, sixty years, historically, we're at an extremely low tax rate environment. So what exactly, where do you want the balance to be? You know, no one wants potholes in the road. Everyone wants to go to good schools, but no one wants to pay any taxes. It's like, hey, let's just level set a little bit. What does everyone think is fair?

• 40:05Speaker 02

  It's probably roughly what you're paying.

• 40:07Anthony Pompliano?

  So what do you think about, like, the wealth tax? Skrt, skrt! Want to know who has the best URL? Crypto.com. That's right, crypto.com. They're a crypto platform with one goal: motherf***ing mass adoption. That's why we're all here. We're trying to get crypto in every wallet. Crypto.com is helping people do that through buying, earning, lending, and card payment. Everything you could want at crypto.com. Go help your boy out. Tell him Pomp sent you. Download the app or visit crypto.com. Pomp's got you always. Everyone wanted to get into mining and didn't know how? Don't worry, your boy Pomp's got you. Everybody got some electricity and wifi. All you gotta do is go to coinmine.com, you buy a coin mine.

• 40:52Anthony Pompliano?

  It's like an Xbox or a Playstation that helps you turn your electricity into Bitcoin. That's right, you purchase it, it shows up at your doorstep. You pull it out of the box, you plug it in, connect to your wifi. Five minutes or less, you're mining Bitcoin. All you have to do is control it from the mobile app they provide. And then you receive over the air updates that add new coins and new features on a consistent basis. Kind of like how Tesla does over the air updates and updates the car software. Just your update in your coin mine. Consumer mining made easy. That's right, go to coinmine.com, tell them Pomp sent you and thank me later. One more word from our sponsor BlockFi. Their new interest account allows you to securely deposit your Bitcoin or Ether at BlockFi

• 41:35Anthony Pompliano?

  and receive 6% annual interest paid monthly in cryptocurrency. This rate actually compounds, so you receive a 6.2% APY, which is very attractive given the alternatives. So you can actually take your Bitcoin, you can deposit it with BlockFi and get paid an interest rate of 6% in return. Go check out blockfi.com/pomp. Again, blockfi.com/pomp to sign up and start earning interest on your crypto today. I think I was gonna ask him about the wealth tax.

• 42:06Speaker 02

  I think it's really interesting that, and this is just in the last week. Who was it? Bezos gave away a ton of money and people kinda swam him.

• 42:16Anthony Pompliano?

  95 million dollars.

• 42:18Speaker 02

  And that didn't go viral. What did go viral was the guy who responded and said, "Just pay your taxes."

• 42:25Speaker 02

  Which hey, you know, these loopholes do exist on these corporate taxes. And you can see that Amazon, and they're certainly not the first ones to do it. Their effective corporate tax rate was 0% last year. And that does seem crazy to me. But you're creating this environment that incentivizes them to move their money to foreign countries with extremely low tax rates and keep the money over there and not bring it back. So it's more complicated than people think.

• 42:55Anthony Pompliano?

  So I would argue that by introducing things like the wealth tax, what you're essentially doing is you're transferring capital from the best capital allocators in the world, which tend to be, you know, successful business owners, large wealthy families or individuals. And the reason why they're the best at capital allocators is that's how they built those big businesses or wealth, et cetera. And you're transferring that from the best capital allocators to notoriously the worst, which is governments.

• 43:24Speaker 02

  Yeah, I can agree with that. I, it would be crazy if that, the way you incentivized our government was by sticking to a budget and they had to stick to the budget to keep their job, to keep their benefits. You know, how quickly would things change?

• 43:42Anthony Pompliano?

  I think that it would be incredible for there to be some sort of, like, process where the government officials have to present their capital allocation strategy every one or two years to a council of the most successful business owners in America.

• 44:07Speaker 02

  I love it. Well, who was it? What was the, was it like the Roman Empire where you didn't run for office? They forced you to do it. That's how I think it should happen. If you're running to be for office or for president, I'm not gonna lie, that job doesn't seem fun at all. People are just mad at you, no matter what you decide. Half of the country's gonna think, you know, you're the worst person of all time. Who would run for that job? That is insane to me. We should start putting names in a hat and just forcing someone to be elected.

• 44:37Anthony Pompliano?

  Who would you force?

• 44:40Speaker 02

  I don't know, I I kind of root for chaos in situations like this, so let's send you up there for like six months.

• 44:44Anthony Pompliano?

  Nah nah nah nah nah, we don't need me doing any of that stuff. Uh, that that would be a nightmare for me and for everybody else. Uh, I got three picks for you, but you go first. You pick a person, I'll I'll name a person. That you would force to be president because you think that they would do a good job, uh, specifically with a bent towards the uh, economy.

• 45:07Speaker 02

  So, one thing we should talk about next is, and this is to your point about we should be able to see how these politicians spend their money. I want to see how someone invests and spends their money before I'm willing to throw them up there. And I want full transparency. None of this took me, you know, five years to release my tax records. I need to see them, you know, right now on the spot without you doing anything to them. And then we'll send you up there to to run the nation's economy.

• 45:34Anthony Pompliano?

  I would pick Bezos as one.

• 45:40Anthony Pompliano?

  I would pick

• 45:43Anthony Pompliano?

  Elon Musk as two, and I'll tell you why in a second. And the third person I would pick.

• 45:51Speaker 02

  Some shady accounting going on over there.

• 45:54Anthony Pompliano?

  My third pick would be somebody who has the intersection of economics, math, and investment, somebody like a Jim Simons. Right? Who who basically just understands how to use data and math to drive economic return. Now.

• 46:13Speaker 02

  I'll tell you who the answer is.

• 46:14Anthony Pompliano?

  Who?

• 46:15Speaker 02

  Who's running RenTech right now? So for people who don't know, this is a massive hedge fund. You can't get in with less than a hundred million dollars. I still, even if you have more than that, I still don't think they'll let you in. They cap the amount of money that they will work with every year. And they're averaging what net of fees, which their fees are ridiculous, forty and four, I think is what they're, four and forty is what they're paying. Uh, and they're averaging forty percent annualized returns after fees.

• 46:41Anthony Pompliano?

  Yeah, Jim Simons is a renaissance.

• 46:44Speaker 02

  Yeah, we'll fix social security real quick.

• 46:47Anthony Pompliano?

  Uh, the reason why I would pick Elon for one of it is, uh, I believe that the way to get out of America's debt is innovation.

• 47:00Anthony Pompliano?

  And to return back to entrepreneurship and innovation and embrace taking these wild bets like the industrial revolution, the space race, etc. And it's not so much that he or somebody like him would figure it out. But if you look at somebody like, I think it's the president or COO of SpaceX is this woman, I think her name's Carolyn Shotwell. She would be a great person.

• 47:31Speaker 02

  You just wanted to see if she could find aliens.

• 47:33Anthony Pompliano?

  No, no, no, no, no. We already know the aliens exist. But no, but if you think about it, right? Like really large budgets, super, super innovative, and if successful, drive such an economic boom for a country that you get out of this whole, we're just holding on, we're trying to plug the holes, like, you know, the ship's sinking, we're under debt, let's raise the debt ceiling, that type of stuff. And instead, what it does is it goes back into a super offensive mindset where being a good capital allocator, driving innovation, and ultimately trying to spur economic growth through what is similar to a private business.

• 48:16Anthony Pompliano?

  If you take that approach, pretty much every politician would fail that test.

• 48:20Speaker 02

  You know, I love that answer. I just think that the team over at Rentech can do that more effectively than Elon and company.

• 48:29Anthony Pompliano?

  Maybe. All right. What is the one biggest surprise that you've had a client walk in and tell you?

• 48:38Speaker 02

  The biggest surprise I ever have in talking to new clients is that...

• 48:43Anthony Pompliano?

  No, no, no. I want like, what's the craziest story? A client said it, walked in and said, hey, I gotta tell you, and then told you X. And you were like, wait, run that back. What did you just say? Like, what's the craziest thing a client's ever told you? Don't, don't tell me somebody admitted to murdering anybody, but it was the craziest thing clients told you.

• 49:02Speaker 02

  I had a prospective client, uh, let's, let's decide exactly which stories we can share here before we throw them on air. It, it's interesting. Clients call us, um, very early on in a lot of pivotal life decisions. When you think about the most taboo conversations you can have, we're recording this a few days before Thanksgiving. The things you don't want to talk about in front of your grandparents are, you know, health concerns, relationship marital concerns, and finances are generally up there with things that people don't want to share publicly.

• 49:45Speaker 02

  We work with families at the intersection of all three of those things. So we know the dynamics of their families. A lot of the times, we know a lot of health concerns that we can't talk about or that we want to help, you know, avoid, offset, or address in some different way. And then obviously, we are managing their entire financial lives, uh, more often than not. And to have those three things intersect, you know, it's, hey, Chris, I don't know what you're doing today. I need you to get on a plane and come meet me and my lawyer, come to this, you know, doctor with me. You know, things are about to change and you need to be at the epicenter of it.

• 50:25Anthony Pompliano?

  Before I finish, I always ask rapid fire questions.

• 50:28Speaker 02

  This wasn't rapid fire?

• 50:30Anthony Pompliano?

  What do you think is the most important company in crypto right now?

• 50:33Speaker 02

  I don't know if you're gonna like this answer. I think Coinbase. When you are looking at trying to adopt something, the user experience, I think, is well undervalued. Those guys do a great job of making it really easy to, to use.

• 50:51Anthony Pompliano?

  What regulation would you change or improve if you could?

• 50:56Speaker 02

  In the crypto space?

• 50:57Anthony Pompliano?

  Anywhere, just in finance in general.

• 51:01Speaker 02

  We need to absolutely eliminate this accredited investor limits. If something's a good investment, people should be able to do it. Trust that people will educate themselves when it comes to their money. They have everything to gain.

• 51:15Anthony Pompliano?

  And what would you say is your most controversial thought in finance?

• 51:22Anthony Pompliano?

  Wait, do you say finance or fin- finance?

• 51:24Speaker 02

  I say finance.

• 51:25Anthony Pompliano?

  Finance, like a normal person, okay. For all those out there that say, what is it, finance? Like, what are you guys doing?

• 51:32Speaker 02

  I think that the craziest thing people are doing, and this is specific to my industry, is no one's asking how we manage our own assets.

• 51:41Anthony Pompliano?

  Explain that.

• 51:42Speaker 02

  When you go to hire a financial advisor, if the first question you're not asking is, how do you manage your own finances? What are you doing? How would you start the conversation anyway else?

• 51:56Anthony Pompliano?

  So, are you saying that people should only go with folks who they agree with how that person's personally managing their own capital?

• 52:05Speaker 02

  Well, would you go to the gym and hire a trainer if he was out of shape?

• 52:10Speaker 02

  Would you go to your dentist if his teeth were all messed up?

• 52:12Anthony Pompliano?

  People do that all the time.

• 52:13Speaker 02

  You shouldn't. That'd be a crazy thing to do.

• 52:17Anthony Pompliano?

  Yeah, that's fair. What's the most important book you've ever read?

• 52:24Speaker 02

  That's a great question. I read a lot of books. I go back and read more often than not, just because it's one of those things where if you read a book different times during your life, you're gonna get a lot more out of it. I don't know if I can just settle on just one.

• 52:40Anthony Pompliano?

  Just one?

• 52:42Speaker 02

  I read books every day.

• 52:43Anthony Pompliano?

  Throw one out.

• 52:45Speaker 02

  The Alchemist, that was a pretty wild book. I've, uh, so my mom actually had copies of that sitting around our house growing up, and all throughout college. She would reread it every single year, which is kinda crazy. But it's something that I picked up and I think it's served me pretty well.

• 53:03Anthony Pompliano?

  Aliens, let's get to the real part of this podcast. Real or not?

• 53:08Speaker 02

  Of course they're real.

• 53:09Anthony Pompliano?

  Why?

• 53:09Speaker 02

  What's that saying where it's like, there are more stars in the sky than grains of sand on every beach?

• 53:17Anthony Pompliano?

  Really?

• 53:18Speaker 02

  Yeah, so just like, go back to your math if you're talking about single entry, double entry, now you scale it up to triple if

• 53:27Anthony Pompliano?

  I'm a big math guy.

• 53:29Speaker 02

  I like to think I am, but my, I can't fathom how expansive the universe is. So just to say we're the only ones seems so naive.

• 53:39Anthony Pompliano?

  Have we contacted them or have they contacted us? Like, do you think there's been contact?

• 53:44Speaker 02

  I think they'd be here if they thought we were interesting.

• 53:47Anthony Pompliano?

  You didn't answer my question.

• 53:49Speaker 02

  I, I'm sure we're being monitored like some sort of science experiment. We're probably like a Petri dish to someone else.

• 53:54Anthony Pompliano?

  You think so?

• 53:55Speaker 02

  Absolutely, and maybe it's not us, so you're trying to get over my skis with math, when you think of the speed of light, it's the fastest way humans are able to think about this. If you're hundreds of light years away and you look back, you're looking back in time now? So what are you seeing? You're not seeing us here right now, you're seeing like dinosaurs.

• 54:20Anthony Pompliano?

  Man, listen, I saw a crazy meme on the internet, said if you think about hair follicles, they disintegrate when they go into the ground. So how do we know that dinosaurs didn't have like long hair?

• 54:33Speaker 02

  Well, don't we?

• 54:34Anthony Pompliano?

  Like, just had like mullets?

• 54:37Speaker 02

  Well, it was like mammoths.

• 54:38Anthony Pompliano?

  That was the, I'm gonna try to find the photo again, I'll link to it in the, in the show notes.

• 54:43Speaker 02

  I don't know if that's what I want my thumbnail to be, hairy dinosaur with mullets?

• 54:47Anthony Pompliano?

  No, it was like a dinosaur with a mullet, it was like, how do we know they didn't have weird haircuts?

• 54:53Anthony Pompliano?

  Alright, man, now, listen, we, we talk about aliens a lot, but I might have to start asking people about dinosaurs too.

• 54:59Speaker 02

  The, the best question you've ever asked on this podcast is, if aliens exist, do they have pets?

• 55:06Anthony Pompliano?

  Legitimate question.

• 55:08Speaker 02

  That's the best question you've ever asked.

• 55:09Anthony Pompliano?

  Do you think so?

• 55:11Speaker 02

  Of course.

• 55:12Anthony Pompliano?

  Why?

• 55:13Speaker 02

  Well, think about all throughout history, or I mean, and again, so like, a piece of a grain of sand, infinitely expansive. People have always had pets.

• 55:25Speaker 02

  Yeah, that's true. What if the dinosaurs were the aliens' pets?

• 55:29Anthony Pompliano?

  Alright, you get to ask me one question to wrap this up. What do you got for me?

• 55:33Speaker 02

  When's the wedding?

• 55:35Anthony Pompliano?

  Oh man, everyone wants to talk about the wedding now. Ms. Plina, if you're listening, I think that she has selected a date. But when the date is official, I will let everyone know. And maybe we'll, you know, not have everyone come to the wedding, but maybe we'll throw a little little party afterwards in New York somewhere. And I'm petitioning to have everyone and anyone who wants to come to show up. Plina is open to the idea, but we have some more negotiating to go.

• 56:06Speaker 02

  So this is for all of your Twitter followers. I know that they're wondering this because you've been buying these Bitcoins forever, you're never gonna sell, hold it forever.

• 56:16Anthony Pompliano?

  I've never said any of that. I don't give much advice.

• 56:19Speaker 02

  In reality, at what price would you take some off the table? And think about it like this. If it could go to $100,000 per Bitcoin, or whatever your price target that you've addressed publicly is, at what point do you take some risk off the table?

• 56:39Anthony Pompliano?

  Honestly, my grandkids will have the Bitcoin that I own.

• 56:44Speaker 02

  Alright, it's a beautiful way to look at risk. Here we go. Risk tolerance off the charts.

• 56:48Anthony Pompliano?

  But it's not risk. I actually think that it is mathematically more risky to hold dollars than it is Bitcoin if you look out over a 200-year timeframe.

• 57:01Speaker 02

  Well, I'm not saying hold dollars. I didn't say that, but...

• 57:04Anthony Pompliano?

  No, I'm just saying, but any asset in the traditional financial system is dollar-denominated. And the reason why I say that is there's two things that Bitcoin has. One is the separation of state and money, and the second is it's a not...

• 57:16Anthony Pompliano?

  Uh, it's a new currency. And so if you look at it mathematically, what is the average life cycle or lifetime of a currency? We're getting pretty deep into the lifetime of the US dollar. And then, uh, so just mathematically, it's unlikely that it'll last for another 200 years, let's say. Uh, Bitcoin has a higher probability of lasting for 200 years than something like a dollar. And the second thing is, uh, I believe that 200 years from now, we will look back and people will say, wait, there used to be, um, money that was controlled and governed and created by the state. That's weird. I think that the, uh, separation of state and money is a foregone conclusion at this point

• 57:59Anthony Pompliano?

  because of things like triple entry accounting, uh, the transparency of a blockchain, et cetera. And so while that seems radical today, 200 years from now, it's gonna be no brainer. 200 years from now, they're gonna take this audio, they're gonna have put it through six different new technologies. And they're gonna be like, who's this crazy guy who was 200 years ago talking about the separation of state and money? So on the record, you'll never diversify your investment portfolio? Uh, I had a friend one time who told me, uh, the best way to diversify is to make more money. And if you think about that, right, it, it's, uh, it's taking a very long-term, low time preference, uh, passive approach to any investment. That, that's not just Bitcoin.

• 58:43Anthony Pompliano?

  It's, um, you know, I know a lot of people who would dollar cost average into the S and P, for example. And it's not like they have in their head, hey, at some point I'm gonna take money out of the S and P. It's this is where I'm going to store a portion of my wealth for the rest of my life. And I'm going to continue to dollar cost average into that position. And over time, that position will continue to grow. And so if you look at your investments or assets that way, it's less about like the short-term investing and where's the price today, et cetera. And it's much more a decision around asset allocation. And then as you make money, you basically allocate based on that asset allocation. And if you have a really, really long time preference, as the study at Fidelity showed, the people who may had the best returning accounts are the people who died or forgot their password.

• 59:28Anthony Pompliano?

  And so time is your friend.

• 59:30Speaker 02

  So the way you're getting out of this is saying you will, for future dollars, you won't allocate 110% of it into Bitcoin. You'll eventually allocate a portion of it into something else.

• 59:45Anthony Pompliano?

  Yeah, I mean, everyone knows that, I always joke, I've been very clear about the asset allocation that I've had, and nobody ever asks me about, what do I do with the other 50 so percent or so? And so the joke that I always say is like, it's not like I'm like levered up on, you know, like 6X levered hedge fund strategies, or I'm not like buying lottery tickets. It's actually a lot of cash, a little bit of real estate, and like super safe, more like barbell strategy type approach. And so if you look at it as, one part of my portfolio would be considered very speculative and risky.

• 1:00:28Anthony Pompliano?

  The other part is super safe and non-risky. That blended risk profile that I'm taking is actually not that bad, given my age and kind of my risk tolerance. There's a lot of people, though, who went the exact opposite direction. They put, you know, 80, 90% of their wealth into these speculative assets, and they didn't have kind of an asset allocation strategy. They're, they're super over-rotated on, on this stuff. And so when the price drops 85%, they lose material parts of their net worth, right? And so I think that, it's why I say it all the time on Twitter, etc., is just, you know, there's some very basic rules here around, don't invest more money than you're willing to lose, right?

• 1:01:13Anthony Pompliano?

  You know, or that you can, that you can actually withstand losing. And things like that, that are just tried and true in every investment in the world, they still apply here, even though this is new.

• 1:01:23Speaker 02

  We'll have to do that for the next one. We'll go through your asset allocation.

• 1:01:27Anthony Pompliano?

  I got some weird stuff in there.

• 1:01:29Speaker 02

  Oh, I'm aware. What was the weirdest thing you have in your portfolio? I don't think it's anything that's weird. Bitcoin, people would say is weird. I own more bonds than a lot of allocators you know would allow me to and it's still an extremely small percentage. I have a blueberry farm in there. People think that's weird.

• 1:01:49Anthony Pompliano?

  Oh, I know about the blueberry farm.

• 1:01:50Speaker 02

  Oh, yeah.

• 1:01:51Anthony Pompliano?

  The craziest thing I have is I have exposure to a company called Nektome, which provides, I'm gonna paraphrase very broadly, but they provide an oxygenated process that delivers cryogenic freezing-like technology. And what it does is it basically preserves the structure of your brain. And so that they can, with almost 100% structural integrity, preserve your brain at the time of death. And they could do everything from research to eventually they would like to be able to take your brain and because they preserve the synapse connections, etc., where knowledge and experience and information is stored,

• 1:02:36Anthony Pompliano?

  load that into a computer.

• 1:02:39Speaker 02

  You forwarded me that deal. For anyone listening, passed. But tell them your most on-brand investment. This is my favorite thing you've ever invested in.

• 1:02:49Anthony Pompliano?

  Which one?

• 1:02:50Speaker 02

  Come on. You give them a shout-out like every week. Your favorite restaurant.

• 1:02:54Anthony Pompliano?

  Oh, McDonald's. What up? Yeah. Actually, somebody while we were sitting here texted me, literally with a selfie, and they're at McDonald's, and said, "Thinking of you." And so it's the best restaurant in America, period, hands down, no question. It's, you know exactly what you're gonna get. It always tastes the same. It's cheap, service is fast. You can find them on every street corner. They have wifi now. And my favorite part? Tell me a dirty McDonald's you've ever gone to.

• 1:03:22Speaker 02

  Pauline, if you're listening to this, tell me when you want to go to dinner. It's on me.

• 1:03:26Anthony Pompliano?

  All right, man. Where can people find you on the internet?

• 1:03:29Speaker 02

  That's my name, Chris Gore, C-H-R-A-S-G-U-R-E. I think I have you in my Twitter and Instagram as my burner accounts, just because you told me not to do that, so I had to.

• 1:03:40Anthony Pompliano?

  All right. Well, we'll do this again in the future. Thanks so much.

• 1:03:42Speaker 02

  Thank you.

• 1:03:44Anthony Pompliano?

  Hey everyone, Pop here. If you liked this episode of Off the Chain and want to help us take crypto to the top of the Apple, Spotify, and other podcast charts, please do us a favor and rate, review, and subscribe. To review, simply go to the Off the Chain homepage, scroll down until you see the five blank stars. Taking 15 seconds to fill those stars in and leave a quick review goes a long way in helping us take the entire crypto ecosystem to the top of the charts. I appreciate you listening and see you next time on Off the Chain.