You add it all together and we're just not in a great place. Why I was bullish stocks yesterday and less bullish today, but not completely giving up the ghost, is I look at that S&P chart and we were so close to just exploding up again, going through 8,000. That's the next leg up. And so you're like, that's with rates having backed up 100 basis points. That's with oil at 90 to $100. That's with this political uncertainty. You threw all that at the market and it can't go down. Normally markets go up. Believe it or not, with all this chaos today, the S&P is down less than a percent. It's down 70 basis points. And so, you got to be very careful in markets like that. One piece of good news and all of a sudden the S&P closes back unchanged on the day. You're like, 'What the hell just happened?'
Welcome to All Things Markets with me, Anthony Scaramucci, and I'm Mike Novogratz. Michael, 10:30 in the morning, October 14th, Wednesday. I don't know. Did you like that inflation print, Mike?
Okay. I mean, that was a bad number, Mike. So, what does that mean for rates?
It means, listen, it means the Fed is closer to hiking. Yeah, it's, you know, it's a 50/50 price now in October, but they're going to hike one of the next two meetings. I'm not sure it matters which one. Um, it means unless something shifts dramatically with the war in Iran, which doesn't look like it's going to happen, we're going to have uncertainty around inflation and rate policy for a while. And add that to the massive amount of funding in the hyperscaler space, there's just a lot of uncertainty around fixed income and it looks like that's finally kicked the equity market in the stomach. And so we could see our first sizable correction. Listen, yesterday the S&P chart looked bulletproof and it's breaking down a little bit today. Not a ton, right? We're not even down a percent on the day. You can look at algorithms where this, you know, you would have the NASDAQ down 3% today. But it's not a good setup for markets right now, especially going to an election where it looks like the Dems are going to run the table.
So, I don't know. I mean, I'm just going off of these numbers. I want to read some of them. The one-year inflation expectation rose to 4.7%. Payrolls, we were expecting 84,000, we got 29,000. Unemployment ticked up to 4.2, but you also know that the labor participation rate is at the lowest it's been in 30 years. So these are not great numbers. Last but not least, 30-year mortgage is at 7.4. So that's sort of 2000. That's before the Gulf War, right? This is before the war in Iraq. So, you know, what do you want to do? You want to sell things? Paul Tudor Jones, who's a mentor of yours, somebody I respect, you want to sell NASDAQ right here for a while. You want to sell S&P. He says he's short though. What do you, you know, Paul Tudor Jones earlier in the week said he doesn't believe JP Morgan's optimism about the market. He's going to be short for the remainder of the year. What's your reaction to that?
Boy, it still feels like 1999, a two-speed market. I know him really well. He'll be short till he makes a bunch of money and then he'll cover and then he'll wait again. But I think his mindset is, hey, unless something changes in fixed income, he's going to trade equities from the short side and that's a change of pace for a lot of people. You know, listen, some sectors, memory already got you, look at the Kospi, you look at Micron, they've already gotten slaughtered. Certainly those charts don't look good. And so you got to figure out where people are long and that's where they're going to sell them. But there was a lot of, listen, there's still a lot of hope on investor day, right, with, is it Anthropic investor day? Losing my mind.
You have a couple things going on. You have Anthropic's investor day. You have Meta put out something called Muse. Michael, they're saying it outperforms Claude Opus 5.5. It outperforms GPT-6 Astra from OpenAI. You know what's interesting is the Meta app, that's the most downloaded app on both Apple and Android in the US over the last week.
I don't, do you? I have, and it's, I'm not, Muse I've used and it's awesome. I've switched to Instinct just because less trust in Zuckerberg, and Instinct is a...
Okay, so who makes Instinct?
It was a young kid who raised a billion, 10 billion, 23 years old. It's awesome. But it's the same thing as Muse. And, you know, unfortunately, they're only as good as you're willing to allow it into your life. And so I've got like a test net, if you want to think about it. And, but, you know, get a credit card with a small limit and get an email that you don't care about. And it's really wild. Hey, buy me tickets. Boom. Tickets are bought. Make me a reservation. Reservation's bought. Scan my email. Is anything important? I do it right. Like...
Well, from a compliance perspective at Galaxy, you allow that or that's just...
Absolutely not. And so, this is just on a little test net I have on my own side. I wish, and I'm sure soon enough people will figure out how to take that leap on both sides, but it is unbelievably effective and it's the first consumer app I've seen that will change people's view about AI. Hey, it works for me. It's cool.
You know, Michael, I want to go back to the Hugging Face hack this summer. Some of the other things that are going on in AI. Zuckerberg says there's no problem with it. The president, President Trump, says there's no problem with it. Even Michael Dell came out this week and said he doesn't have a problem with it. He wants forward progress in AI. Is that...
He'll have a vested interest in it, I guess.
Yeah. Is it the right call though? I mean, as a...
I'm going to lunch right after this podcast. I'm going to lunch in Midtown with one of the experts on the other side of that to hear his story. I don't know is my honest answer right now. From all the people I've talked to, I think a little more caution is merited than the one we're having. That there's not just Hugging Face. There are thousands of these unwanted swarm activities and that gets everyone nervous. I mean, I think that's why they wrote that letter. Really thinking through what the policy should be to ensure that we don't have a train wreck, figuratively or even literally, I think is really important. And, you know, it's interesting because most people, even close to the hoop, don't really understand how it works well enough. You know, okay, yes, we don't want drones, swarm, but what does that even mean? How do we stop that? How do you monitor that? And so I'm trying to get up the curve on that. Just my instinct is we probably should slow down a little bit until people are all pretty comfortable. And when you have the table surrounded by all people with a vested interest for the thing to work, that's not necessarily the fair table. You know, it's like if you ask eight wrestlers what's the best sport, they're all going to say wrestling.
Well, I mean, I guess the thing I'm the most worried about, or, you know, if there's a catastrophe, how does that impact valuations, Mike?
Obviously, it'll impair the economy and do other things.
Yeah. But it'll also hit the overall stock market though, too, won't it?
I mean, I think if there was a catastrophe, an AI catastrophe, NASDAQ would be down 30%.
Yeah. All right. Right. So, something for people to really notice and something for people to take into consideration given everything that's going on. I want to go to some stats about older Americans. The baby boomers are winning. Michael, the other generations are not doing as well. Overall median net worth rose just 2% from 2022 to 2025. However, the top 10% of earners saw their wealth increase 31%. Okay. Bottom 40% got poorer, Mike. But Americans 75 and older saw their wealth rise by 37%. You and I both know the reason for that. They own the stocks. The younger people don't. So, what do you, you know, you are a philanthropist. You are somebody that's concerned about the overall society. What do you say about this? Let me give you one more stat before you answer. Median net worth for Black families fell 25%.
Listen, there's a couple policy shifts that you probably should see happen, right? First of all, like capital gains and income tax should be normalized. Like why are we giving people with capital this great tax break versus people that work for a living? And so I understood originally why you were trying to incentivize people to invest in the long term, but I think at this point you roughly, because you're going to need to redistribute some, right? It just doesn't work with this kind of inequality without some redistribution. Though you want redistribution in a way that feels fair and feels smart. And again, in a perfect world, you're redistributing directly. You're not going through this really inefficient government bureaucracy to redistribute. We're not in a perfect world, so you can't let perfect be the enemy of the good. I think you're going to see Democrats come to power and talk a lot about things like that. Trump will veto them all, but that will be the election in '28. And I think this is where we're heading. You can't have those stats for too much longer without people saying this just doesn't make any sense for us anymore. And again, the rise of the Mamdani's of the world, they play really well to that. I don't like their solutions. That's why I'm already spending a lot of my own time figuring out what are the smart pro-American solutions to kind of get us back to some balance.
The problem what I'm worried about is the left-leaning policies. They may end up slowing down the economy. I just think, but the right-leaning policies seem like there's like a Hoover vacuum for the very wealthy, Michael, you know. Yeah. So, I mean...
No, you're spot on right there.
You know, it wasn't this way in the '90s. It was a much wider, deeper dispersion of income increases. It's creating a lot of anxiety. I want to go to crypto. You and I are crypto guys. We don't really talk about crypto that much. Where do you think the world is now post-clarity? Will we see greater tokenization? We're at 34 billion and counting in terms of real world assets that have been tokenized. Do you think that's going to continue? Do you think that we're going to see a slowdown? Do you think Bitcoin is stalled here?
I don't. I think you're going to see tokenization increase steadily and then one day it's going to increase quickly. I don't see it increasing quickly in the next week, but there's a steady drumbeat of people building infrastructure and so I don't think that's slowing down at all. I think Bitcoin, separate question, trades really well. Stuck around this 80 to 85 range, 82 to 87. Feeling some pressure today because of the overall interest rate scenario. If you had told me that Bitcoin would be at 82 with rates having rallied or sold off so much, I would have been surprised. And so it's held up with the S&P. And I think a lot of the people that needed to sell it sold it. You know, we should watch it. It's not going to explode up until there's either a crisis in the long end of the US where the yield curve just steepens like crazy or the economy slows because of all this stuff and the Fed says, I need to stop hiking rates. I need to cut them. That's a hike before cut, right? So that's a ways off. I mean, the other potentially bullish catalyst, you know, Bessent has the Treasury funding announcement at the end of the month. And he could very well say no more 20-year auctions. Like he could do Operation Twist, you know, the first thing he started to do, but do it much more aggressively to try to really control the long rates. I don't think he will, but he could. It's in his arsenal. And I think if he does that, Bitcoin's going to go for a run.
And so, go ahead, give me the reason why he wouldn't do that because he's got...
Because he kind of tried the first time and, you know, Dr. Miller called him out and the market didn't take it well. The bond market is really big and to try to manipulate it to some degree is a fool's errand. Other people have tried and sometimes they succeeded, right? The Japanese did for a long time.
Yeah. And Bernanke seemed like he had things under control 10 years ago. No.
Yeah. We just feel like we're in a different space now with this $41 trillion in debt.
All right. So, too heavy. The government's going to need to pay more money to people for them to take on the debt is what you're saying.
