Bursting Of The Sovereign Debt Bubble | Arthur Hayes

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On today’s episode, Arthur Hayes CIO at Maelstrom Fund joins the show to explore his current macro framework and how that will impact crypto for the rest of the year & into 2024.
We discuss the bursting of the sovereign debt bubble as bonds continue one of their largest sell-off's in U.S history, the dreaded bear steepener and it's impact on bank balance sheets, market liquidity & how crypto can act as a safe haven during periods of financial repression, deleveraging & inflation. To hear all this & more, you'll have to tune in!
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Referenced In The Show:
Oil: The Making of the Modern World: podcasts.apple.com/gb/podcast...
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Timestamps:
00:00 Introduction
00:38 The Debt Problem
05:43 The Dreaded Bear Steepener
10:56 Are U.S Banks In Trouble Again?
15:30 The Social Consequences Of Too Much Debt
20:19 DAS London
21:36 Financial Repression
28:18 Trade Wars Are The Mirror Image Of Currency Wars
33:11 Blockworks Research
42:27 Bitcoin
43:15 The Crypto Bull Market
54:42 The Bitcoin Halving
56:05 Liquidity
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Disclaimer: Nothing discussed on On The Margin should be considered as investment advice. Please always do your own research & speak to a financial advisor before thinking about, thinking about putting your money into these crazy markets.

[@brianspence1983]

Arthur is awesome. Speaks plainly and to the point.

[@dfaz917]

He was also all in on the Eth merge -50% ago

[@mark75700]

I wish i learnt most of these principles about seven years ago. A lot of people have been trapped strongly in the matrix-- Go to school, get a job, and then slave your whole life. Many miss out on life-changing information that could have great effect on their finances. I played with the stock market sometime in 2020, and I was surprised at how well it turned out. I want to put in $90k more into the market. I heard people are making really great returns despite the downturn. Any recommendations?.

[@sandra65823]

Avert too-good-to-be-true con tricks. Consult a fiduciary counselor; these professionals are among the best in the business and offer individualized guidance to clients based on their risk tolerance. There are undesirable ones, but some with a solid track record can be excellent..

[@MargaretMargaretKarjala]

Yes, I've been in constant touch with a Financial Analyst for approximately 8 months. You know, these days it's really easy to buy into trending stocks, but the task is determining when to sell or keep. That's where my manager comes in, to help me with entry and exit points in the industries I'm engaged in. Can’t say I regret it, I’m 40% up in profits just in 5months with my initial capital of $160k...

[@jonas77718]

How can one find a verifiable financial planner? I would not mind looking up the professional that helped you. I will be retiring in two years and I might need some management on my much larger portfolio. Don't want to take any chances...

[@MargaretMargaretKarjala]

My Financial adviser is ‘’Stephanie Kopp Meeks ’’ she’s highly qualified and experienced in the financial market. She has extensive knowledge of portfolio diversity and is considered an expert in the field. I recommend researching her credentials further. She has many years of experience and is a valuable resource for anyone looking to navigate the financial market...

[@jonas77718]

Thank you for this tip. It was easy to find your coach. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her resume....

[@RyanHoguePassiveIncome]

Arthur Hayes is brilliant, appreciate you having him on

[@AUstinnesc]

I blame the Fed for global economic crisis, they can print credit as long as someone will borrow it into existence, but production cannot be printed. Right or wrong?

[@McElvinn]

right! never can tell what the future holds, definitely a time to consider financial planning and not time for blames

[@sheltonPston]

True, I'm quite lucky exposed to personal finance at an early age, started job 19, bought first home 28, got laid-off work 36 due to covid-outbreak, and immediately consulted a financial planner to handle growing my finance. Long story short, I'm only 25% short of my $1m goal after a couple 100s of thousands invested so far.

[@corrySledd]

well done! love to stick it on my own but at some point, everyone needs a sort of guidance, would you mind disclosing info of your advisor here please? in dire need of portfolio assistance

[@sheltonPston]

Can't divulge much, the professional that guides me is 'Nicole Desiree Simon' you can research, she has a great deal of expertise with over 2 decades of experience, and very easy to work with.

[@corrySledd]

appreciate this, found her consulting page immediately after inputting her full name on my browser, she is valid

[@troy8231]

Michael Howell has been years ahead of every macro “expert” on this.

[@4mb127]

Always love listening to Arthur.

[@Anza_34832]

@47:37 As Arthur rightfully argues, this widely expected Bitcoin-ETF might initially drive up the price of Bitcoin…but will ultimately turn into a big negative. Just look at what “Paper-Gold” did to gold…

[@andrewshantz9136]

The futures ETF had that effect. The spot ETF requires the provider to hold spot BTC.

[@JoshStall]

If liquidity on exchanges stays low (2MM), BTC will moon again when ETFs start. As long as the spot etfs are required to hold BTC it should be good.

[@Anza_34832]

I agree with both of you: If spot-ETF would be legally required to hold actual bitcoins, this would increase demand (just like physically backed “real” gold-ETFs). But I would not be surprised if a spot-ETF would come with some legal twist = not being required to be 100% backed by actual bitcoins… Again, no government in their right mind is interested in promoting any money that’s outside of its political sphere of influence, as money is key to political power and influence.

[@JoshStall]

@@Anza_34832 It isn't really behaving like money this far. It seems to have more use cases that complicate what it actually is. I think we tend to try and fit it into a box but, it really is completely revolutionary. Thus far the government has categorized it as a commodity and I am content with that. Nothing has indicated they view BTC as competition to the dollar yet. It will be interesting to see how things evolve.

[@johnnyglinko]

Arthur you are a Rockstar , thanks for your no f..n BS explanations! 🙏🏻

[@iGaryTheSnail]

Blockworks are killing it with content 👌

[@handyrams4822]

The man the myth the legend the bitmex liquidator 😂

[@theonlyconstantischange123]

The liquidatooooooor

[@entervalhalla8484]

Arthur Hayes! 😀 I love his interviews, always. Thanks for this one Michael.

[@theresawaveyme4482]

Love the show, as always. Arthur is so interesting to listen to. Thanks for bringing it.

[@mattanderson6672]

Really enjoyed that! Get Arthur back soon, brilliant guest!

[@andreattafabio]

Arthur. The man. The myth. The legend.

[@peterryan5606]

Best interview ya ever had!! Hes right on point!!!

[@bitbybit3889]

Both of you guys talk about the most interesting shit. Love it

[@Charles-hy2ek]

Good interview, this man speaks in a language I can mostly understand, fin speak is so convoluted, I liked the island metaphor

[@SuperLkelley]

Arthur is awesome.

[@roddywoods8130]

Inflation, bank collapse, severe drought in the agricultural belt, recession, food shortages, diesel fuel and heating oil shortages, baby formula shortages, available automobile shortages and prices, the price of living place.

[@selenajack2036]

Government policy has thrown the future under the bus for decades. The day of judgment is near. I predict an 80% drop in the stock market. Investors will abandon stocks in favor of real estate. There will be no money in banks... You must devise a strategy for survival.

[@hushbash2989]

I agree. I have pulled in more than $435k since 2020 through my advisor. It pays off more in the long run to just pick quality stocks and ride with those stocks.

[@adenmall7596]

Mind if I ask you recommend this particular professional you use their service? I have quite a lot of marketing problems.

[@hushbash2989]

My Financial adviser is Mrs Marisol Cordova, she’s highly qualified and experienced in the financial market. She is considered an expert in the field. I recommend researching her credentials further. She has many years of experience and is a valuable resource for anyone looking to navigate the financial market.

[@kaylawood9053]

She appears to be well-educated and well-read. I ran a Google search on her name and came across her website; thank you for sharing.

[@gasbird]

Glad we caught you between sets

[@maninderchahal2442]

Mr Hayes has great insights. Thanks.👍

[@brothermu]

This guy is dope. Pure crypto bro, even wearing the right shirt. Respect him, even if I'm expecting him to be wrong.

[@erikjones3064]

Nice job getting Crypto Hayes!

[@user-dotori126]

Arthur Hayes thank you so much❤❤❤

[@pjviitas]

Some good stuff....thanks for taking the time to share

[@jeffsurfanderson]

If we allow the government to fail to do a reset you should also be buying gold because that is your true Safe Haven which the price of gold will Skyrocket better than any treasury payout that you can get

[@user-99.99]

Excellent info. Thank you. 🙏🏻

[@hr4ny]

ARTHUR WE LOVE YOU 🤩

[@chemicalhalf]

Love Arthur's point of view. Just super smart.

[@morkobot4862]

great guest!

[@ProjectYaris]

Third time listening to this and catch new gems every time. Safe treading all.

[@christophehkg6056]

Always a blast!

[@detectiveofmoneypolitics]

Economic investigator Frank G Melbourne Australia is still watching this very informative content cheers Frank as subscriber 😊

[@ttabasso]

great talk - although true this is widely understood now - this consensus and a soft landing is apt to kick back in for awhile as CPI drops faster

[@stevecatpatrick8056]

I feel like the guest should have differentiated a bit between issuing debt and monetizing debt. He equated issuing debt with printing money but that's not true if it's funded by capital already existing in the private sector. We're not printing money in that scenario, But we are if we monetize the debt by Central Bank purchases. Also while I agree that held to maturity is an accounting trick, along with the risk rating of assets in the Basel rules, as they mentioned the government didn't term out the debt, So at least a decent portion of it is shorter maturity. The government stuff that is, The MBS portfolio durations have exploded and will likely stay quite high.

[@k98killer]

Caveat: TSYs are typically considered "money good" and are often used as currency.

[@TPAK-tb6gr]

48:45 in just described counterparty risk regarding Bitcoin. Still a great interview! 🤙

[@ginamurray711]

Arthur Hayes!!! ❤

[@ttabasso]

although we thought Sub Prime in q3 2005 would play out in 2006 maybe 2007 - sometimes things so obvious take longer to play out - and this seems very similar

[@scolem2681]

Great analysis 👍

[@daviddelacey8938]

Arthur Hayes one of the brightest guys out there

[@bruceaulabaugh]

Proof that wearing a tank top on Blockworks Macro makes you smart and articulate! Thank you Arthur.

[@jtrealfunny]

Love this host. Special mention for interviewing a man who looks like a free safety for the patriots and is dressed for the gym in the same way he'd interview Lyn Alden or Jim Bianco. Let's see how this goes. On the debt I share the opinion that Powell and Yellen sort of need to manage the necessary inflation our fiscal side requires. Great guest. On bitcoin I wish he'd mention US versus Global. Bitcoin seems a real threat to the US and dollar supremacy. And perhaps a real recourse for every day people in countries with unstable currencies. I can't imagine the US Govt. just letting bitcoin flourish?

[@edgeman148]

Here are my thoughts after 40 years in technology and recently in AI and Web3 work. As time passes and technology-power increases, Bitcoin mining will move into home heating, both central and water and as a result mining will become tremendously decentralized. Thanks as always for the podcast.

[@HoneyBadger80886]

I love cryptoHayes❤

[@TrackE11even]

31:15 The quote is from Jim Rickards, he wrote the book titled Currency Wars

[@andrewshantz9136]

I appreciate Arthur’s points overall but disagree that there is going to be a colapse because major econs are producing too much physical stuff with no buyers. That maybe true for manufacturing but that is a smaller % of consumption vs services. He’s under-accounting for the mitigating effect of increased productivity on the problems he’s rightly diagnosing.

[@jamesbascom526]

Arthur Hayes is on target.

[@warrenberkholtz8410]

Can you differentiate between the total GDP versus the Real GDP that is based on goods and services (i.e., provided by humans) and not derivatives or corruption now legal since the repeal of Glass-Steagall Act and section 10-32 of the Banking and Securities Act paased to avoid another Depression lik 1930's - just curious

[@Rnankn]

The American WMD being exported to the world is the notion of ‘we the people’ as individuals against their own government. Democracy is literally self-rule, so how can ‘the government’ be the ubiquitous ‘them’ who are allegedly against you? The public interest is not the aggregate of individual preferences. And while modern civilization is enhanced (and harmed) by hydrocarbons, that is surplus energy, not the basis of human life. You cannot eat or drink oil, and you can eat and drink without oil. Natural systems and the biosphere are the basis of life. So measuring energy as barrels of oil, ignores the biophysical flows of energy that are far more essential for quality of life. When the harms of hydrocarbons exceed the benefits, they are no longer appropriate. When the benefits accrue to a small minority, it is just harming others for personal comfort.

[@nobodysfool2232]

Arthur gates is the man. J agree with almost everything he says

[@trapOrdoom]

This is the most interesting interview lmao. The brutha has nothing in that room but a frame filled with a collage of red boxes? He’s in a tank top, and cursing like a sailor 😂.

[@BatmanBoss]

Crypto Hayes 💪

[@davidnardini628]

The Max power theory in natural law backs the oil based economy that you define. The complexity of society is determined by available power in the system. This theory was first defined long before oil was available. If you connect oil and the economy, debt in-particular you create energy debt in a system, which eventually has to be paid, or eventually society should shrink in order to pay back the energy debt. It's only a question of when, it's a scientific fact at this point.

[@johnwoodlock6334]

This guy's awesome

[@xebechemorpheus8814]

The one contradictory statement is if every large country wants to ramp up production and there is no place to sell it prices should be deflating but they are not. Stuff should be everywhere but it’s scarce. Just saying

[@9394cody]

More Arthur please

[@elliotthovanetz1945]

Which of the 10000000 cryptos do we invest in? Bitcoin as the default global currency? I read bitcoin is outdated already as far as block chain technology..

[@389293912]

If printing money solves all problems, why do we have to pay income tax?

[@flyingsnow311]

Yes, right now everyone has the opportunity to use crypto to evade the state's access because you can remember the code in your head and travel with it. However, what if the governments, all banks and exchanges accept the "off and on ramping" in connection with crypto-generated money. what are you doing then?? All I hear is BTC is decentralized and nothing can happen here. But no one has been able to give me a satisfactory answer to the question I just asked. If you have an idea, please let me know - thank you

[@finkbuilt]

Micheal, you've got to stop saying "rising precipitously". Precipitous is only a way to describe downward motion. The root is "precipitation" like rain for instance. it only falls, or settles to the bottom.

[@BlockworksHQ]

You learn something new every day - thanks!

[@rd9102]

Excellent interview. Very interesting perspective with information to back it up. I like this guy. His thoughts on Crypto is pretty laughable while we watch all kinds of scams about crypto but hey he is entitled to his opinion, good luck with Bitcoin and other crypto.

[@jeffmoss118]

Where else can people put their money. Every market is manipulated

[@rd9102]

@@jeffmoss118 If you say so, i don't see it that way. Lot's of places to put your money to work.

[@ph318]

You sound naive

[@rd9102]

@@ph318 You sound like you live in delusional conspiracy theory fantasy land, good luck there. I will continue to grow my riches while you wait for the boogeyman to show up.

[@stevehughes3984]

Love Arthur not sure I can agree on all countries making products. in this and China has an ageing population before the US.

[@chargermopar]

Debt is like time travel. I say real wealth comes from energy. Crypto is energy used to support a world wide database. The one thing I believe is that the powers in place will use it as long as they want, then pull the plug through EMP or direct attack. I would rather hold some form of energy in hand, in case it all vaporizes.

[@Rnankn]

You believe democracies will attack themselves? So your instinct is to protect yourself with your own energy? Thats insane and sad. But debt is more like the colonization of the future than time travel, because of interest. Travellers don’t change size, but debt grows.

[@lukelewkowicz2233]

We live on credit from the onset of time to the end alloted to each and of us.

[@389293912]

Nice. Reducto Ad Absurdum. An easy way to destroy current monetary policy. If we can afford anything by borrowing and lending, why am I paying income tax?

[@donTeo136]

In one state in Australia, they completely 100%, renewable energy, for days at a time. That's means transport, home everything. This without the system still not built out . Think about this as a fundamental energy/ oil/ money relationship. What that means. It's not idle talk , those are proofs.

[@stephenburnage7687]

I think you are talking about Tasmania, which has hydro. Yes, hydro is 'renewable' but not sustainable ie it irequires building dams, which disrupt the ecology.

[@TheRustyLM]

@@stephenburnage7687 and those dams take millions of tons of concrete (carbon), tons of steel (carbon), millions of gallons of diesel (carbon). Then the electricity takes tons of copper. I don’t need to explain the carbon hungry endeavor that mining is. Bottom line: no energy is carbon neutral nor renewable.

[@joebagodonuts8119]

BTC is not a hard asset. It’s a ledger.

[@Brian-vk1hm]

its both

[@pansyalert6063]

"very very pumped" XD

[@gecko2000405]

He basically describes Yellen @2:15 to a T.

[@cjswa6473]

You can easily care 1 million dollars of gold in a brief Case. When you sell that crypto..if you have a gain. Technically you have created a taxable gain. And unlike Bitcoin.. everyone will take it. Bitcoin is tougher and way more volatile

[@jayearl3591]

F**king Blackrock putting ads just as you talk about the Spot ETF 🤪 Thankfully as an Adam Curtis follower, I've known to be cautious of Blackrock since 2016 (Hypernormalisation). Hayes is bang on spot that Blackrock will play their playbook as history has shown, because there is no innovation in the monolith TradFi world

[@anitarahiman3092]

Great information. They cook the financial books to their pockets and you the tax payers get handed the bail out bills

[@RafalBr]

There is looming recession that has already started. Boom and bust cycle right now. Few months untill everything breaks.

[@tomstarwalker]

Meanwhile in the both ends of the IQ Gaussian curve: "Solar panels".

[@rof8200]

No other element can do what gold can. Does not oxidize, limited availability and malleable. However, almost every other crypto can do what Bitcoin can do. Seed phrase key, limited availability and divisible to 18 decimal places.

[@Aziz__0]

Given the current economic difficulties that the country is experiencing in 2023, how can we enhance our earnings during this period of adjustment? I cannot let my $680k savings vanish after putting in so much effort to accumulate them.

[@Natalieneptune469]

Well the bigger the risk, the bigger the reward and such impeccable decisions are better guided by professionals

[@PhilipMurray251]

Yes true, I have been in touch with a financial advisor. With an initial starting reserve of $80k, my advisor chooses the entry and exit commands for my portfolio, which has grown to approximately $550k

[@Patriciacraig599]

I’ve been looking to switch to an advisor for a while now. Any help pointing me to who your advisor is?

[@PhilipMurray251]

There are a lot of independent advisors you might look into. But i work with NICOLE DESIREE SIMON and I have been working together for nearly four years, and she is excellent. You could proceed with her if she satisfies your discretion. I endorse her

[@Patriciacraig599]

I just looked her up on the internet and found her webpage with her credentials. I wrote her a outlining my financial objectives and planned a call with her.

[@madness5327]

Blackrock and Vanguard are the state.

[@joshuaclark9545]

bitcoin is pseudonymous, not anonymous. Once you can tie down a pseudonym with someone, anybody can watch every transaction you make. Just wanted to point that out after something he was saying to the contrary.

[@JWRB6]

"You can't print energy"... 'Hold my beer' * plugs in $20k of solar panels *

[@justinjtv4089]

but BoA has the BTFP so they're fine.. without the BTFP all the banks are Fd

[@wolfsden3]

I just got a 21 month 0% apy interest rate for balance transfer up to $8700 from CITI 😂. I bumped over $6k lol

[@albeit1]

Part of why BTC is doing well versus gold AND fiat is that crApto currencies are all failed or flailing.

[@bobsclassiccarsparts8772]

Your guest Mr Hayes is a smart guy no doubt & although my 40 year investing past has lead me down some different conclusions still it was interesting to listen to his perspective. However he needs to clean up his language.

[@klebercoutinho7349]

You work for 40yrs to have $1m in your retirement, meanwhile some people are putting just $10k in a crypto market for just few months and now they are millionaires , all thanks to Mrs Jane, God bless you madam 😇

[@jameslarry3919]

Wow I' m iust shock someone mentioned expert Mrs Jane thought I'm the only one trading with her

[@jameslarry3919]

She helped me recover what I lost trying to trade my self.

[@trayerwilderness2534]

She's really amazing with her skills..she changed my 0.5btc to 2.1btc

[@jasonjonathan428]

I think I'm blessed because if not I wouldn't have met someone who is as spectacular as expert Mrs Jane, I think she is the best broker I ever seen.

[@SantiagoGarcia-up7hm]

I still wonder how she gets her analysis, I got profit of $28, 609 with a capital of $4000 in 16 days of trading with her

[@ForwardGuidance]

So does this mean there will be more smokers? I invest in tobacco stocks. 😂

[@adaylateacoinshort]

long story short frequent yield curve control will be the story for developed nations and finale as always will be a crisis of global scale like covid (the beta test) or war if it comes to that.

[@jasonclement6305]

My daughters ears are clearly not mature enough for macro

[@ForbiddenCatBelly]

😂

[@k98killer]

The world is not a good place to raise children and never has been because it is full of adults.

[@MS-dx6yz]

>Bitcoin is the way out >The banks are going to have an ETF Pick one.

[@TopGoggins]

L comment

[@brianborse3555]

"owning bitcoin is like having a billion dollars in your brain" well said, but not for the reasons he thinks Good interview though, and some interesting insights for sure

[@jarekpiotrowski742]

He’s contradictory with his filecoin claim - it’s already pumped … so he doesn’t have a sound thesis

[@m.vonhollen6673]

Bitcoin… no government can ever issue more of it, thereby devaluing it.

[@aaronnewkirk7085]

Buy some metaverse property too while you are at it. Screw tangible assets. LMAO

[@389293912]

Borrowing and lending should not be part of GDP. Borrowing and lending is a net 0 when it comes to "product". I have spoken. That is all.😂

[@noonebeer]

It's not 2 simultaneous wars. It's 3 simultaneous wars. You forgot about Taiwan and the South China Sea On that note, love Arthur's analysis. Great guest

[@ocox8659]

Looks like Arthur just got back from the gym 😅

[@billybudapest3129]

Bitcoin is fiat, just like the dollar, the only meaningful difference is the fixed supply of Bitcoin.

[@MoonBerryShrimp]

We CAN print energy with Nuclear. Chinas building ~20 nuclear power plants, US only ONE.

[@kk-xj5oz]

I'm not so sure about bitcoin I see the benefits, but it still doesn't really hold any value. I still believe in stocks but they're highly overpriced today.

[@jeffreyestrada5935]

It seems how US can afford two or three wars is the same way a person with $60K/yr can afford a million dollar home...the magic of financing. Boomers like me look ahead 25 years and ask can my wealth hold out that long? Younguns more likely look head 25 years and ask how much will it take to live then? If there is then.

[@lak1294]

Really good insights, thank you! More people need to hear this (particularly the woke who seem to think they can continue to live their best lives on renewable energy only). Magical thinking!

[@jdg9999]

Yep, the point about oil shows that all the stuff about "sustainability" is basically jist saying "be poorer"