The Pomp Letter

Today’s letter is brought to you by Domain Money!

If you’re reading this right now you don’t need financial advice, if you did you would use Domain Money, a company of flat fee financial planners that craft you a personalized, in-depth plan with unbiased, straightforward, and real sound advice based on your values and goals, but you are all better than that.

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To investors,

The Presidential debate was a circus last night. Rather than a conversation focused on policies and results, the American people were subjected to a poorly scripted theatrical performance by two candidates who seemed to be focused on scoring internet points. 

Anyone with eyes could see that the moderators were biased, Trump took multiple pieces of bait pushing him into an angry rhetoric, and Harris dodged every question about her track record like Mohammed Ali in his prime. 

However, my biggest takeaway was not the things said during the debate, but rather the things that were not said. 

The American economy is in a precarious position. Inflation currently sits nearly 25% higher than the Fed’s target of 2%. Home affordability is the worst it has been in decades. The national debt is skyrocketing to more than $35 trillion. Over half the country reports living paycheck-to-paycheck and tens of millions of Americans don’t have enough savings to cover a $400 emergency payment. 

There are real problems that must be solved.

Neither candidate presented a plan on how to address these issues. There was no promise of getting inflation down, nor a believable plan on how to do it. Both candidates just kept blaming each other for what happened in the past and tried to convince the public “it wasn’t me!”

Not one word was uttered on how to address the structural issues in housing so American families can afford a place to live. Saying housing is unaffordable doesn’t count as a plan, nor does promising to give people free money for down payments, especially since that would make the affordability problem worse. 

And in one of the most shocking developments, there were zero mentions of a desire to balance the annual budget. Imagine the United States running a nearly $2 trillion deficit annually, with the national debt accelerating, and the individuals who want to be the next President don’t even mention the issue.

Wait, you don’t have to imagine. That is literally what happened last night. 

We can’t solve our problems if we don’t talk about them. And candidates won’t present solutions to the problems unless they believe the American people will change their vote in November based on the economic plans.

Instead of focusing on nonsense like taxing unrealized gains, we need more people asking for specificity on getting inflation down, balancing the budget, dropping the national debt burden, and increasing the quality of life for hard-working Americans. 

Many people vote with their wallets. Last night was a missed opportunity for either candidate to present themselves as the economic leader who could get the job done. 

Hopefully that changes for the next debate. The American people deserve to know what our next leader plans to do for the US economy. And my guess is the candidate who seizes the moment will capture real momentum going into the November vote. 

Hope you all have a great day. I’ll talk to everyone tomorrow. 

-Anthony Pompliano

Founder & CEO, Professional Capital Management

Reader Note: BUILD Summit, our annual conference in NYC for founders, is coming up next month on September 26th.

The event will provide top tier speakers, networking opportunities, and insightful business discussions on raising capital, scaling businesses, and building products.

Current speakers include angel investor Balaji Srinivasan, Khosla Ventures’ Keith Rabois, Perplexity CEO Aravind Srinivas, Eight Sleep Founders Matteo Franceschetti & Alexandra Zatarain, and Passes CEO Lucy Guo.

The event is free to attend and will be full of insights on how to operate a company at world-class level.

Polina Pompliano, Author of ‘Hidden Genius’ and Founder of The Profile, and Anthony Pompliano, CEO of Professional Capital Management, discuss what is going on with bitcoin, future catalyst, and price outlook into bull market, we break down the OnlyFans business, shocking revenue share breakdown, SpaceX, Starlink, Elon Musk, and predictions for the Presidential debate. 

Listen on iTunes: Click here

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Anthony & Polina Pompliano Discuss Bitcoin, Presidential Debate, OnlyFans Financials, and Elon Musk’s Starlink

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* CrossFi is the Apple Pay for Crypto. For the first time in history, anyone with a web 3 wallet can spend crypto through a physical or virtual Visa card where Visa is accepted.

* Domain Money makes financial planning straightforward and accessible.They tailor plans to your personal priorities and goals, whether it’s buying a house, funding college, or taking that dream vacation.

* iTrustCapital allows you to buy and sell cryptocurrency in a tax-advantaged crypto IRA. Open and fund an account today to receive a $100 USD funding bonus.

* ResiClub - Your data-driven gateway to the US housing market.

* Professional Capital Management - Anthony Pompliano’s asset management firm is now on Linkedin. Please subscribe by clicking here.

You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren’t finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.

1 While I am not a financial advisor and can’t give financial advice, Domain Money has board-certified CPAs who can give you financial advice and keep you on track to reach your goals.

As always, doing your own research before purchasing any product/service is important. View this important disclaimer so you know exactly what to expect.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit pomp.substack.com/subscribe

REMINDER - The BUILD Summit Is Two Weeks Away!

BUILD Summit, our annual conference in NYC for founders, is coming up next month on September 26th.

The event will provide top tier speakers, networking opportunities, and insightful business discussions on raising capital, scaling businesses, and building products.

Current speakers include angel investor Balaji Srinivasan, Khosla Ventures’ Keith Rabois, Perplexity CEO Aravind Srinivas, Eight Sleep Founders Matteo Franceschetti & Alexandra Zatarain, and Passes CEO Lucy Guo.

The event is free to attend and will be full of insights on how to operate a company at world-class level.

To investors,

There is a new article in Business Insider titled “United States of Bitcoin: Crypto miners got kicked out of China. Now they're sucking America dry.”

As you would predict, the writer presents a heavily biased view that bitcoin mining is bad. He cites the usual statistics of high energy consumption, points to a few local groups protesting specific bitcoin mining facilities, and then even suggests America is left holding China’s bag (“it's just the latest example of China kicking out burdensome industries only for them to end up on America's doorstep”).

What I found most interesting was the complete disregard for the positive argument for bitcoin mining. There was no mention of the former ERCOT President saying bitcoin miners were essential to Texas stabilizing their electricity grid. There was no mention of the thousands of jobs that have been created by the industry. There wasn’t even a passing comment about bitcoin’s success in protecting the purchasing power for hundreds of millions of people globally.

It is this last point that I believe should get much more attention.

American citizens just lived through the highest inflation period over the last half century. Official government measurements reported CPI to be over 9% at the peak. This destruction of economic value for 300+ million Americans should be unacceptable in a developed nation that serves as the leading financial economy.

So what is an appropriate investment to solve this problem?

The answer is significantly higher than people are comfortable admitting publicly. Behind the physical safety of its citizens, a country should work tirelessly to protect the purchasing power of its people. Once you lose physical safety, people flee. And if you lose economic stability, people flee.

Ultimately, the people pay the government for protection — both physically and economically.

There is a balance though. Government have a very hard job. They must provide this protection, so they can keep their citizens happy, but accomplish the task without micro-managing their lives or exerting too much control. That is the challenge for every elected leader.

Serve the people without controlling the people.

Economics is one of the best places to see how this can play out. The free market does a great job of regulating the economy over the long-run. Humans have no patience though, so we constantly intervene in the market. We can’t help ourselves.

But this is where bitcoin mining comes in. The decentralized network of machines has created and secured the strongest computer network in the world. These pieces of hardware prevent humans from intervening. The system is literally designed to save us from ourselves.

And along the way, bitcoin miners are protecting the purchasing power of bitcoin holders. The median home in the US cost 664 bitcoin in 2016. Today that same home costs 6 bitcoin. That is a 99% reduction in the cost of a home in less than a decade.

Who ensured that happened? Bitcoin miners.

That narrative was absent from the Business Insider article. It didn’t fit the preconceived perspective of the author. Thankfully, facts are still facts. We should spend whatever it takes to protect our purchasing power.

In my experience, it is worth reading the critiques of bitcoin. It helps every holder stay sharp and think critically about what they hold. Who knows, maybe the author will be like us and eventually become a bitcoiner after spending the time to learn more. Never say never.

Hope you all have a great day. I’ll talk to everyone tomorrow.

-Anthony Pompliano

Founder & CEO, Professional Capital Management

Dave Collum is the Department Chair and Professor of Chemistry at Cornell University.

In this conversion, we talk about the economy, inflation, stock market, investing outlook, politics, Trump, Harris, Vance, Walz, RFK Jr, geopolitical analysis, and how you can start to think more independently. 

Listen on iTunes: Click here

Listen on Spotify: Click here

Disaster Is Coming To Financial Markets? Dave Collum Interview

Podcast Sponsors

* Gemini is the safe and secure way to trade crypto. Use code Pomp100 and start trading crypto to earn $100 in BTC. 

* Xapo - Xapo Bank is the only way to bank with Bitcoin. 

* CrossFi is the Apple Pay for Crypto. For the first time in history, anyone with a web 3 wallet can spend crypto through a physical or virtual Visa card where Visa is accepted.

* Domain Money makes financial planning straightforward and accessible.They tailor plans to your personal priorities and goals, whether it’s buying a house, funding college, or taking that dream vacation.

* iTrustCapital allows you to buy and sell cryptocurrency in a tax-advantaged crypto IRA. Open and fund an account today to receive a $100 USD funding bonus.

* ResiClub - Your data-driven gateway to the US housing market.

* Professional Capital Management - Anthony Pompliano’s asset management firm is now on Linkedin. Please subscribe by clicking here.

You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren’t finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit pomp.substack.com/subscribe

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To investors,

The world changed on August 15, 1971 — President Nixon implemented a number of changes to the US economy in response to high inflation. These changes became known as the “Nixon shock.”

Changes included:

* Wage freezes

* Price freezes

* Surcharges on imports

* Cancellation of international convertibility of US dollars to gold

The Nixon shock kicked off a new era for the United States — the fiat currency regime had begun.

Since that day, the US stock market has been open for trading in just over 100,700 hours. That may seem like a useless data point, but Cory Bates points out something interesting happened this year that made the fiat era US stock market hours of operations noteworthy.

Bitcoin, which was only launched in 2009, officially eclipsed the US stock market in terms of hours of trading. Bitcoin now stands at more than 123,000 hours of trading, which is nearly 25% higher than the fiat era for public equities.

There are two takeaways from this information — first, it is insane that the US stock market is closed more hours per week than it is open. It is quite eye-opening that bitcoin, which started public trading less than 15 years ago, has been more accessible than public equities in the last 50 years.

Second, you could argue that bitcoin is older than the fiat era stock market. The digital currency may not be older in terms of total years, but it is definitely more mature in terms of trading hours.

Some people will disagree and likely claim that the US stock market dates back to before 1971. While that is true, the regime change in the Nixon shock is all that matters in today’s stock market.

Why is the Nixon shock mainly what matters? The US stock market gains are largely driven by fiat debasement. The more the dollar is devalued, the faster the stock market accelerates.

How can you tell? The CME Group has two great charts highlighting (1) gold’s relative performance to equities and (2) the US stock market denominated in gold.

Let’s bring this back to my main point — the US stock market materially changed in 1971 even though Nixon didn’t explicitly predict it. If you take the market since this new era started, it has traded less hours than bitcoin.

Bitcoin’s robust system has been tested more than the US stock market. That statement will put the legacy finance folks’ brains in a blender. But it is true.

The only time a system is tested is when it is in use. Bitcoin’s market has been used more than the fiat era stock market. That is a narrative that should be spread far and wide.

Hope you all have a great start to your week. I’ll talk to everyone tomorrow.

-Anthony Pompliano

Founder & CEO, Professional Capital Management

Reader Note: BUILD Summit, our annual conference in NYC for founders, is coming up next month on September 26th.

The event will provide top tier speakers, networking opportunities, and insightful business discussions on raising capital, scaling businesses, and building products.

Current speakers include angel investor Balaji Srinivasan, Khosla Ventures’ Keith Rabois, Perplexity CEO Aravind Srinivas, Eight Sleep Founders Matteo Franceschetti & Alexandra Zatarain, and Passes CEO Lucy Guo.

The event is free to attend and will be full of insights on how to operate a company at world-class level.

Phil Rosen, the Co-Founder of Opening Bell Daily, and Anthony Pompliano, CEO of Professional Capital Management, discuss why stocks and bitcoin are down, economic policies for Trump & Kamala, proposed capital gains tax increase, and outlook on asset prices during interest rate cuts. 

Listen on iTunes: Click here

Listen on Spotify: Click here

Why Bitcoin and Stocks Have Been Crashing

Podcast Sponsors

* Gemini is the safe and secure way to trade crypto. Use code Pomp100 and start trading crypto to earn $100 in BTC. 

* Xapo - Xapo Bank is the only way to bank with Bitcoin. 

* CrossFi is the Apple Pay for Crypto. For the first time in history, anyone with a web 3 wallet can spend crypto through a physical or virtual Visa card where Visa is accepted.

* Domain Money makes financial planning straightforward and accessible.They tailor plans to your personal priorities and goals, whether it’s buying a house, funding college, or taking that dream vacation.

* iTrustCapital allows you to buy and sell cryptocurrency in a tax-advantaged crypto IRA. Open and fund an account today to receive a $100 USD funding bonus.

* ResiClub - Your data-driven gateway to the US housing market.

* Professional Capital Management - Anthony Pompliano’s asset management firm is now on Linkedin. Please subscribe by clicking here.

You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren’t finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit pomp.substack.com/subscribe

To investors,

Inflation has been the story of the decade so far. We went from sub-2% in early 2020 to over 9% by the summer of 2022. Today, one of economists favorite metrics sits at just under 3%.

This roller coater ride has had a significant impact on asset prices and investor psychology. On one hand, investors who have been allocated to the stock market continue to see their portfolio value increase as indexes push higher. The classic adage “time in the market is more important than timing the market” stands for a reason.

The S&P 500 is up 85% over the last 5 years. Russell 2000 has appreciated 42% and the Nasdaq 100 is up 141% during the same time period. Investors simply had to invest in indexes and chill. Monetary and fiscal policy did the rest for them — inflation took off, the dollar was devalued, and asset prices went up.

As stocks went higher, investors gained more confidence that higher prices were just around the corner. Add in the fact that existing capital in the market was also gaining value and you can see how we arrive at the new all-time high of stock allocation as a percent of financial assets.

Wall Street Journal's Gunjan Banerji writes yesterday:

“The surging stock market has minted millionaires and helped send many Americans’ net worth sharply higher. As of the second quarter, the number of 401(k) retirement accounts at Fidelity Investments worth at least $1 million reached around 497,000, according to the firm. That is up 31% from a year ago and a record high.U.S. households’ stock allocations have steadily inched up this year, according to JPMorgan estimates, and recently accounted for around 42% of their total financial assets. That is the most on record in data going back to 1952.”

There is a debate raging due to this data — are investors merely riding the trend that will continue for the foreseeable future or are investors over-confident and a market correction is just around the corner?

The short answer is no one knows, but I think the framework for evaluating the situation is wrong. Only short-term oriented investors should be concerned about the week-to-week or month-to-month oscillations in the stock market.

Majority of investors should simply have a long-term orientation. They can be oblivious to price movements and merely continue dollar cost averaging into their preferred index. Given enough time, the stock market will continue going higher and is essentially guaranteed to be at new all-time highs.

The United States debt requires dollar devaluation, which in turn pushes all assets denominated in dollars to be worth more in dollar terms.

So the only people in the market who should be worried about short-term price movements are older folks who have less time to benefit from. Anyone under the age of 50 years old has at least a decade, and probably longer, to weather potential market downturns.

The beauty of ignoring short-term predictions is that an investor is exposed to the market if prices go up and they are continuing to dollar cost average if the market goes down. If the market is up, your portfolio is worth more. If the market is down, you are buying more assets at cheaper valuations.

Regardless of the scenario, being long the US stock market over decades is a cheat code — the US stock market is the greatest millionaire minting machine ever created.

You just have to be able to allocate capital, stomach volatility, and stay focused on the long-term. And based on the latest data, it looks like more Americans are deciding to go long stocks. We’ll see what they do if there is turbulence in the coming months.

Hope you all have a great day. I’ll talk to everyone tomorrow.

-Anthony Pompliano

Founder & CEO, Professional Capital Management

Reader Note: BUILD Summit, our annual conference in NYC for founders, is coming up next month on September 26th.

The event will provide top tier speakers, networking opportunities, and insightful business discussions on raising capital, scaling businesses, and building products.

Current speakers include angel investor Balaji Srinivasan, Khosla Ventures’ Keith Rabois, Perplexity CEO Aravind Srinivas, Eight Sleep Founders Matteo Franceschetti & Alexandra Zatarain, and Passes CEO Lucy Guo.

The event is free to attend and will be full of insights on how to operate a company at world-class level.

Darius Dale is the founder & CEO of 42Macro.

In this conversation, we discuss inflation, productivity, asset prices, political impact, federal reserve interest rate decisions, and outlook for 2024. 

Listen on iTunes: Click here

Listen on Spotify: Click here

Darius Dale Explains Why Inflation May Come Back In Q1

Podcast Sponsors

* Gemini is the safe and secure way to trade crypto. Use code Pomp100 and start trading crypto to earn $100 in BTC. 

* Xapo - Xapo Bank is the only way to bank with Bitcoin. 

* CrossFi is the Apple Pay for Crypto. For the first time in history, anyone with a web 3 wallet can spend crypto through a physical or virtual Visa card where Visa is accepted.

* Domain Money makes financial planning straightforward and accessible.They tailor plans to your personal priorities and goals, whether it’s buying a house, funding college, or taking that dream vacation.

* iTrustCapital allows you to buy and sell cryptocurrency in a tax-advantaged crypto IRA. Open and fund an account today to receive a $100 USD funding bonus.

* ResiClub - Your data-driven gateway to the US housing market.

* Professional Capital Management - Anthony Pompliano’s asset management firm is now on Linkedin. Please subscribe by clicking here.

You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren’t finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit pomp.substack.com/subscribe

Today’s letter is brought to you by Domain Money!

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To investors,

Rent for a one-bedroom apartment in New York City recently hit a new all-time high of $4,500 per month. This is a 50% increase from the $3,000/month that a one-bedroom commanded pre-pandemic.

Aziz Sunderji recently explained that New York City’s rent prices are increasing at the same time that New York City home prices are softening.

As real estate agent Rohin Dhar pointed out, this price increase is not exclusively the product of inflation. New York City has banned Airbnb, implemented vacancy controls, and has relied on rent controls for decades.

This intervention in the free market historically creates more problems, rather than solutions.

One way to see this is that the national median rent for a one-bedroom is only growing at 1.6% annually, which is lower than the current inflation number.

This suggests that Airbnb and a lack of hardcore rent controls in the vast majority of the country has actually been a release valve for median rents over the last 12 months.

Free market solutions are better than government solutions.

This is true internationally as well — Bloomberg’s Cagan Koc and Sarah Jacob recently covered the Dutch rental market, where they noticed that government controls have had a negative impact as well.

It is estimated that 96% of all rental properties in the country are now under rent control. Cagan and Sarah write:

“The Netherlands has the highest proportion of rent-controlled homes in Europe, according to the Organization for Economic Cooperation and Development. About a quarter of them are owned by private landlords, with the rest belonging to housing associations that are similar to co-ops. Before the new law came into effect, four-fifths of the country’s 3 million rental properties were subject to controls, and the law raised that to 96%, according to the housing ministry. The measure caps rents on about 2.5 million homes at €880 ($980) a month for households earning less than €52,671. The rest of the properties covered by the law have a maximum rent of €1,158 a month; though they have no specific income requirements, they’re aimed at families with modest salaries.”

There is a massive housing shortage in the Netherlands and citizens are having a difficult time finding affordable rentals. What else would you expect if the government got to set the price of 96% of all rentals?

But the United States should not shake our heads and say “well, that isn’t happening the US.” It is true that rent control is not nearly as prevelant, but the housing shortage is very real.

First, on rent control:

“As of 2022, seven states (California, New York, New Jersey, Maryland, Maine, Oregon, and Minnesota) and the District of Columbia have localities in which some form of residential rent control is in effect (for normal structures, excluding mobile homes). Thirty-seven states either prohibit or preempt rent control, while seven states allow their cities to enact rent control but have no cities that have implemented it. For localities with rent control, it often covers a large percentage of that city's stock of rental units. For example, in New York City as of 2017, 45% of rental units were "rent stabilized" and 1% were "rent controlled" (these are different legal classifications in NYC). In the District of Columbia as of 2019, about 36% of rental units were rent controlled. In San Francisco as of 2014, about 75% of all rental units were rent controlled, and in Los Angeles in 2014, 80% of multifamily units were rent controlled.”

Sounds better than the Netherlands, right? Well, the US continues to under-build housing which spells pain on the horizon.

We built about 50% less housing from 2010-2019 compared to 2000-2009. Not exactly what you want to see if you are worried about home prices and/or rent prices.

I am not an expert on US housing or rents. For that, I highly suggest you subscribe to Lance Lambert’s ResiClub newsletter. I learn a ton from him daily.

But I do know that you can’t let government intervention disrupt the free market or you will create significantly more problems — this is what has happened in New York City and it will likely spread throughout the country as more intervention is encouraged from a political standpoint.

We usually like all-time high prices in finance, but all-time high rents are not something to celebrate.

Hope you all have a great start to your week. I’ll talk to everyone tomorrow.

-Anthony Pompliano

Founder & CEO, Professional Capital Management

Reader Note: BUILD Summit, our annual conference in NYC for founders, is coming up next month on September 26th.

The event will provide top tier speakers, networking opportunities, and insightful business discussions on raising capital, scaling businesses, and building products.

Current speakers include angel investor Balaji Srinivasan, Khosla Ventures’ Keith Rabois, Perplexity CEO Aravind Srinivas, Eight Sleep Founders Matteo Franceschetti & Alexandra Zatarain, and Passes CEO Lucy Guo.

The event is free to attend and will be full of insights on how to operate a company at world-class level.

Polina Pompliano, Author of ‘Hidden Genius’ and Founder of The Profile, and Anthony Pompliano, CEO of Professional Capital Management, discuss the US economy, interest rates decision, taxing of unrealized gains, arrest of Telegram CEO, the impact of the two astronauts stranded in space, and more. 

Listen on iTunes: Click here

Listen on Spotify: Click here

How To Invest During A Recession

Podcast Sponsors

* Gemini is the safe and secure way to trade crypto. Use code Pomp100 and start trading crypto to earn $100 in BTC. 

* Xapo - Xapo Bank is the only way to bank with Bitcoin. 

* CrossFi is the Apple Pay for Crypto. For the first time in history, anyone with a web 3 wallet can spend crypto through a physical or virtual Visa card where Visa is accepted.

* Domain Money makes financial planning straightforward and accessible.They tailor plans to your personal priorities and goals, whether it’s buying a house, funding college, or taking that dream vacation.

* iTrustCapital allows you to buy and sell cryptocurrency in a tax-advantaged crypto IRA. Open and fund an account today to receive a $100 USD funding bonus.

* ResiClub - Your data-driven gateway to the US housing market.

* Professional Capital Management - Anthony Pompliano’s asset management firm is now on Linkedin. Please subscribe by clicking here.

You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren’t finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit pomp.substack.com/subscribe

To investors,

The public narrative for wealth creation is that you can’t get rich working for someone else. America has a culture of individualism and entrepreneurship, which has served the country well as we continue to innovate in various industries.

But new data coming out of Nvidia suggests there is an exception to every rule.

In a recent survey of over 3,000 Nvidia employees, approximately 76% reported being a millionaire and 1 out of every 3 employees claim to have a net worth of over $20 million.

These are shocking numbers. If the data is accurate when applied to all ~ 33,000 current employees at the company, there would be 25,000 millionaires created by Jensen Huang and his team. This would not include any prior employees who have worked at the business over the last 30 years but are no longer working there.

That is a mind-blowing statistic, but the even crazier one is that almost 12,000 employees reportedly have a net worth of over $20 million.

This type of wealth creation is typically reserved for the best investors or company founders and executives. There are few companies in history that can boast of turning so many teammates into multi-millionaires.

But there is an interesting takeaway from this data — companies that solve problems in society, especially companies that provide a product that has unlimited demand, are able to generate immense enterprise value.

As Phil Rosen pointed out in Opening Bell Daily today, Nvidia has seen their market cap increase by more than $3 trillion since Chat-GPT launched.

This is in comparison Warren Buffett’s Berkshire Hathaway which just hit a $1 trillion market cap for the first time yesterday. Buffett took decades longer, yet Nvidia has become a 30-year overnight success.

I love seeing incentives line up for founders, employees, and shareholders. These three groups are all-in on the artificial intelligence revolution. If the company can continue to provide the critical infrastructure necessary for the industry to grow, we should expect more millionaires to be minted.

Capitalism is the greatest system created so far. Maybe someone will create a better one in the future, but until that happens we should celebrate when the system works.

Hope you all have a great day. I’ll talk to everyone tomorrow.

-Anthony Pompliano

Founder & CEO, Professional Capital Management

Reader Note: BUILD Summit, our annual conference in NYC for founders, is coming up next month on September 26th.

The event will provide top tier speakers, networking opportunities, and insightful business discussions on raising capital, scaling businesses, and building products.

Current speakers include angel investor Balaji Srinivasan, Khosla Ventures’ Keith Rabois, Perplexity CEO Aravind Srinivas, Eight Sleep Founders Matteo Franceschetti & Alexandra Zatarain, and Passes CEO Lucy Guo.

The event is free to attend and will be full of insights on how to operate a company at world-class level.

Polina Pompliano, Author of ‘Hidden Genius’ and Founder of The Profile, and Anthony Pompliano, CEO of Professional Capital Management, discuss the US economy, interest rates decision, taxing of unrealized gains, arrest of Telegram CEO, the impact of the two astronauts stranded in space, and more. 

Listen on iTunes: Click here

Listen on Spotify: Click here

Anthony & Polina Pompliano Discuss Taxing Unrealized Gains and Interest Rate Cuts

Podcast Sponsors

* Gemini is the safe and secure way to trade crypto. Use code Pomp100 and start trading crypto to earn $100 in BTC. 

* Xapo Bank is the only way to bank with Bitcoin. 

* CrossFi is the Apple Pay for Crypto. For the first time in history, anyone with a web 3 wallet can spend crypto through a physical or virtual Visa card where Visa is accepted.

* Domain Money makes financial planning straightforward and accessible. They tailor plans to your personal priorities and goals, whether it’s buying a house, funding college, or taking that dream vacation.

* Meanwhile is the world’s first licensed and regulated life insurance company built for the Bitcoin economy. 

* iTrustCapital allows you to buy and sell cryptocurrency in a tax-advantaged crypto IRA. Open and fund an account today to receive a $100 USD funding bonus.

* ResiClub - Your data-driven gateway to the US housing market.

* Professional Capital Management - Anthony Pompliano’s asset management firm is now on Linkedin. Please subscribe by clicking here.

You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren’t finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.

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To investors,

There is a debate raging over whether the US economy is headed towards a recession or not. Investors and market commentators are watching unemployment, inflation, consumer spending, and various other metrics to predict any potential economic pain ahead.

I don’t think this is the right way to evaluate the market right now.

Regardless of whether the economy slows down or not, the Federal Reserve has positioned itself well to accelerate economic activity over the next 12-24 months. Interest rates are currently over 5% and the central bank was able to sell almost $2 trillion of assets off their balance sheet since 2022.

This means the Fed was able to restock their ammunition. When they are called back into the fight, we will watch the money printer get turned back on and a few hundred basis points of interest rates will disappear.

I explained this situation to Phil Rosen late last week:

The noteworthy aspect of financial markets at the moment is we are at or near all-time high prices in stocks, crypto, and gold. This has happened without the Fed stimulating the economy or asset prices.

Once the quantitative easing playbook is turned back on, we should expect asset prices to respond favorably.

Speaking of quantitative easing — the central bank has perfected this playbook since the Global Financial Crisis. I believe they are quicker today to cut interest rates and print money than they have been historically.

You saw this in 2020 when the Fed conducted two emergency rate cuts to bring the market to 0% rates. There was trillions of dollars printed via monetary and fiscal policy within weeks as well.

The combination of a central bank having numerous tools at its disposal, along with a faster response time in deploying those tools, means that a recession will have a harder time persisting.

And we should expect lower rates to lead to higher asset prices. History is largely undefeated on this point.

Cheaper capital is coming to the market. Which also means a portion of the approximately $6.4 trillion sitting in money market funds will likely want to find a new home in equities.

Whenever I hear a loud roar of investors talking about a recession, I start thinking the opposite is probably true. I would think the same if everyone was yelling that no recession is possible right now.

Real damage occurs when the market is caught offsides in either direction. The more people who think a recession is coming, the lower likelihood we will see that outcome.

The various trends and data points suggest asset prices should be higher 12 months from now. I wouldn’t want to be on Team Recession at the moment.

What do you think? Are you changing your portfolio at all? Feel free to respond to this email and I’ll do my best to respond to each of you.

Hope you all have a great day. I’ll talk to everyone tomorrow.

-Anthony Pompliano

Founder & CEO, Professional Capital Management

Daniel Batten is the Co-Founder and Managing Partner of CH4 Capital. Daniel is an ESG investor and believes bitcoin mining is one of the most important technologies when it comes to the environment.

In this conversation, we talk about what is holding back sovereign wealth funds from investing 1% of their assets into bitcoin, ESG decision making process, what it will take to educate them, and what the impact of sovereign wealth funds and countries will have. 

Listen on iTunes: Click here

Listen on Spotify: Click here

Daniel Batten Explains What Will Convince Sovereign Wealth Funds To Buy Bitcoin

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* Meanwhile is the world’s first licensed and regulated life insurance company built for the Bitcoin economy. 

* iTrustCapital allows you to buy and sell cryptocurrency in a tax-advantaged crypto IRA. Open and fund an account today to receive a $100 USD funding bonus.

* ResiClub - Your data-driven gateway to the US housing market.

* Professional Capital Management - Anthony Pompliano’s asset management firm is now on Linkedin. Please subscribe by clicking here.

You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren’t finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit pomp.substack.com/subscribe

To investors,

All eyes in financial markets are on the September interest rate decision from the Federal Reserve. Investors have been convinced interest rate cuts were right around the corner at various times throughout the year, but recent economic data has finally driven consensus agreement for September.

Kalshi, a leading prediction market for economic data, shows an 88% chance that the Fed will cut rates by 25 basis points in approximately one month.

But here is the thing — no one actually knows what is going to happen. It is impossible to predict the future, especially when Fed Chairman Powell is unlikely to know what he is going to do yet too.

The current data suggests the Fed should already be cutting interest rates. It would only take one or two economic reports full of bad data to change that outlook though. When Powell gives his speech this week from Jackson Hole, I would not expect him to commit to any specific decision.

It is true that the Fed likes to signal their future moves and decrease the surprise to market participants. But there is too much time, and enough opportunity for economic data to change, that Powell is more likely going to suggest that we are getting closer to an interest rate cut without confirming the September timeline.

Regardless of what Powell says this week, stock market investors are positioning themselves to benefit when cheaper money starts flooding into the market.

Bloomberg’s Jess Menton points out that over $3 trillion has been added to the S&P 500 since the August market low.

Menton goes on to point out an interesting data point related to the annual Jackson Hole meeting in relation to stock volatility:

“A Fed chair’s speech at Jackson Hole typically isn’t a big catalyst for the stock market unless it comes before a crucial shift in monetary policy — like now. Since 2000, the S&P 500 has climbed 0.4% on average in the week following the gathering, data compiled by Bloomberg Intelligence show.

It’s Powell’s appearance at Jackson Hole in August 2022, when he warned that the Fed would need to keep monetary policy restrictive to battle inflation, that’s still fresh in traders’ minds. Stocks plunged 3.4% that day and lost another 3.3% in the week following his remarks.”

Jerome Powell is not the only thing to pay attention to this week. Reports are coming out that economic data revisions are inbound, which will put the existing situation in a less ideal position.

“On Wednesday, the Bureau of Labor Statistics will downward revise jobs for the April 2023-March 2024 period by up to 1 million. This means that all "beats" recorded in the past year will have been misses and the US job market is in far worse shape than the admin would admit.”

We won’t know if these revisions actually happen for a few days. This is just a rumor at the moment, but it would follow the trend of California making major revisions a few weeks ago which wiped out all job growth in the state for 2023.

So here is the situation — we have increasing odds that the economy is not as strong as everyone thinks it is. Investors are salivating over an interest rate cut. And we have plenty of room to cut rates without ending up with 0% rates again.

Based on what we know now, the rate cut will happen in September. It will be 25 basis points, stocks will start to rise into the end of the year, and both political parties will complain about monetary policy changing so close to the election.

Plenty can change between now and September 18th though. For example, the Trump assassination attempt was only five weeks ago. That feels like a lifetime away. Let’s see what happens in the next four weeks.

Hope you all have a great start to your week. I’ll talk to everyone tomorrow.

-Anthony Pompliano

Founder & CEO, Professional Capital Management

Phil Rosen, the Co-Founder of Opening Bell Daily, and Anthony Pompliano, CEO of Professional Capital Management, discuss the economy, inflation, volatility in the stock market, and future outlook for financial assets.

Listen on iTunes: Click here

Listen on Spotify: Click here

Anthony Pompliano Explains Why Price Controls Are A Bad Idea

Podcast Sponsors

* Gemini is the safe and secure way to trade crypto. Use code Pomp100 and start trading crypto to earn $100 in BTC. 

* Xapo Bank is the only way to bank with Bitcoin. 

* CrossFi is the Apple Pay for Crypto. For the first time in history, anyone with a web 3 wallet can spend crypto through a physical or virtual Visa card where Visa is accepted.

* Domain Money makes financial planning straightforward and accessible. They tailor plans to your personal priorities and goals, whether it’s buying a house, funding college, or taking that dream vacation.

* Meanwhile is the world’s first licensed and regulated life insurance company built for the Bitcoin economy. 

* iTrustCapital allows you to buy and sell cryptocurrency in a tax-advantaged crypto IRA. Open and fund an account today to receive a $100 USD funding bonus.

* ResiClub - Your data-driven gateway to the US housing market.

* Professional Capital Management - Anthony Pompliano’s asset management firm is now on Linkedin. Please subscribe by clicking here.

You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren’t finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit pomp.substack.com/subscribe

To investors,

Vice President Harris is expected to unveil an economic plan later today in her bid to be elected President of the United States in November. The plan will cover numerous topics, but two things getting attention already are her ideas on how to bring down the cost of food and home ownership.

First, it is true that food prices have exploded in America. Grocery bills are up nearly 26% since the last election in November 2020. Both sides of the aisle agree we need to get these prices down, along with ensuring future price growth is at a much more moderate rate.

The disagreement between political parties is related to the best plan of action. Vice President Harris is slated to claim grocery stores are price gouging. She is going to propose a national ban on this price gouging, which will magically bring down food prices. Of course, that is not how the world works.

Grocery stores operate on razor thin margins. Estimates are between 1-4%, so the idea of price gouging in this industry is absurd. The real reason grocery prices have gone up is because the dollar has been debased and input costs for grocery stores have skyrocketed. When input costs go up, the output prices have to go up too.

The government should not fool itself into believing it can run a grocery store better than the executives of these companies. Price caps and other artificial interventions in the market will not solve the problem. In fact, history suggests that these actions will accelerate the problem and make things worse. Just ask the people of Venezuela.

If you want to bring down the price of food, there is only one reliable solution — you have to produce significantly more food.

Supply and demand determine price. Increase supply for prices to come down.

It doesn’t appear the existing administration attended their Economics 101 class in college though.

Unfortunately, food is not the only place where economic illiteracy is being applied.

Vice President Harris’ second major talking point for her economic plan today will related to housing. She is reportedly going to propose a $25,000 boost for first-time home buyers, along with a call for 3 million or more homes to be built.

The idea of giving free money to people to help them buy a home feels like a noble thing, yet it will have the opposite effect. Home prices will increase by $25,000 or more. The market responds to changes in variables.

With that said, Harris’ call for millions of additional housing units to be built is a great idea. We should celebrate this plan. We should giver positive reinforcement to her and her campaign. If you want to bring down home prices, then you have to create more supply.

Build. Build. Build.

That is the solution to the housing crisis. The solution to home affordability lies in the hands of home builders. If the government wants to participate and be helpful, they should reduce regulation and help home builders do what they do best — build more homes!

My hope for our next President, regardless of which candidate it is, will be for the application of basic economic concepts. Increase supply of food and homes to bring the costs of those items down. Give relief to citizens not in the form of handouts, nor through market manipulation, but rather via the hard work of producing more goods and services.

That is how you create lasting change. Javier Milei is doing it in Argentina right now. There is no reason we can’t do the same in the United States.

Let’s just hope Trump or Harris has the courage to do the hard things. Hundreds of millions of Americans are counting on them.

Hope you all have a great weekend. I’ll talk to everyone on Monday.

-Anthony Pompliano

Founder & CEO, Professional Capital Management

Phil Rosen, the Co-Founder of Opening Bell Daily, and Anthony Pompliano, CEO of Professional Capital Management, discuss the economy, inflation, volatility in the stock market, and future outlook for financial assets.

Listen on iTunes: Click here

Listen on Spotify: Click here

Anthony Pompliano Explains Why Price Controls Are A Bad Idea

Podcast Sponsors

* Gemini is the safe and secure way to trade crypto. Use code Pomp100 and start trading crypto to earn $100 in BTC. 

* Xapo Bank is the only way to bank with Bitcoin. 

* CrossFi is the Apple Pay for Crypto. For the first time in history, anyone with a web 3 wallet can spend crypto through a physical or virtual Visa card where Visa is accepted.

* Domain Money makes financial planning straightforward and accessible. They tailor plans to your personal priorities and goals, whether it’s buying a house, funding college, or taking that dream vacation.

* Meanwhile is the world’s first licensed and regulated life insurance company built for the Bitcoin economy. 

* iTrustCapital allows you to buy and sell cryptocurrency in a tax-advantaged crypto IRA. Open and fund an account today to receive a $100 USD funding bonus.

* ResiClub - Your data-driven gateway to the US housing market.

* Professional Capital Management - Anthony Pompliano’s asset management firm is now on Linkedin. Please subscribe by clicking here.

You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren’t finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit pomp.substack.com/subscribe

To investors,

On June 27th I wrote a letter to this group titled “Prepare For A Volatile Second Half Of The Year.” It included the following chart from Bank of America, which highlighted a 25% increase in volatility from July - November of election years.

Almost exactly on cue, volatility exploded within the next 45 days. Michael Batnick from Ritholtz Wealth Management put together this chart to show the volatile move was the third highest VIX spike since 1990.

Volatility works in both directions. It can force asset prices higher or lower. This time it pushed the stock market lower, which created fear that spread through markets.

But Batnick writes on his blog that “everybody [should] be cool.” Why? Because 94% of all stock market years since 1928 have seen a drawdown of 5% or more.

Although the data suggests we are living through the norm, it won’t change investors’ amnesia. People love to freak out every time the market drops.

This is not only investors though. CEOs and company operators are watching the market and interest rates with a microscope. The Kobeissi Letter writes:

“The number of "Federal Reserve" mentions during the earnings conference calls is on track to hit a new record in Q2 2024. It is estimated the Fed will be mentioned ~380 times during Q2 earnings calls, according to Bloomberg. This would be more than TRIPLE the number of references seen in 2021. CEOs and CFOs are trying to figure out the future path of US interest rates. Weaker consumer demand and the pain of high inflation have put the Fed's next move in the spotlight. Everyone is waiting on the Fed.”

Interest rates obviously matter for stock market performance, but the higher rates have pushed our national debt interest payments to absurd levels. Charlie Bilello writes:

“The Interest Expense on US Public Debt rose to a record $1.11 trillion over the last 12 months, more than doubling over the past two years. At the current pace it will soon be the largest line item in the Federal budget, surpassing Social Security.”

We are only a month and a half into the second half of the year. Volatility is spiking as predicted. There are still more than 100 days until the end of November. It would be naive for us to believe the chaos is behind us.

Investors should buckle up, keep their head on a swivel, and realize it may be a bumpy ride for the next 3-4 months.

The good news? If you are a long-term investor, the short-term volatility won’t matter. But if you are living your life based on the day-to-day fluctuations of your portfolio, then you may be in for a few surprises.

Hope you all have a great day. I’ll talk to everyone tomorrow.

-Anthony Pompliano

Founder & CEO, Professional Capital Management

Jason Les is the CEO of Riot Platforms, one of the largest miners in North America. They are a publicly traded company that is exclusively focused on mining as much bitcoin as possible. 

In this conversation, we talk about public policy, politicians becoming interested in bitcoin mining, what is going on with the bitcoin halving, hardware updates, rise of AI, competition for power, and much more.

Listen on iTunes: Click here

Listen on Spotify: Click here

Riot Platform CEO Jason Les on Mining, Regulation, and Energy Critiques

Podcast Sponsors

* Gemini is the safe and secure way to trade crypto. Use code Pomp100 and start trading crypto to earn $100 in BTC. 

* Xapo Bank is the only way to bank with Bitcoin. 

* CrossFi is the Apple Pay for Crypto. For the first time in history, anyone with a web 3 wallet can spend crypto through a physical or virtual Visa card where Visa is accepted.

* Domain Money makes financial planning straightforward and accessible. They tailor plans to your personal priorities and goals, whether it’s buying a house, funding college, or taking that dream vacation.

* Meanwhile is the world’s first licensed and regulated life insurance company built for the Bitcoin economy. 

* iTrustCapital allows you to buy and sell cryptocurrency in a tax-advantaged crypto IRA. Open and fund an account today to receive a $100 USD funding bonus.

* ResiClub - Your data-driven gateway to the US housing market.

* Professional Capital Management - Anthony Pompliano’s asset management firm is now on Linkedin. Please subscribe by clicking here.

You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren’t finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.

This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit pomp.substack.com/subscribe