TL;DR: Fed politics intensify as Trump pushes for rate cuts while Bitcoin treasury companies experience massive volatility.
📄 SUMMARY
Fed Board Politics & Rate Trajectory
Cameron and Matt Dines dive deep into the Federal Reserve's board of governors structure, explaining how it's always been political despite claims of independence. With Steven Miran's Senate confirmation (48-47 vote), Republicans now hold a 4-3 majority on the FOMC. Matt emphasizes "this is a political board. It's always been that way" (21:42-23:30). The dot plots show 2025 rate expectations shifting downward, with one member (likely Miran) voting for rates between 2.75-3% by year-end. Trump is pressuring for Lisa Cook's resignation, whose term runs until 2038, while Jerome Powell's chair term expires May 2025 though his governor seat continues until January 2028.
Deal Season: US-UK & US-China Negotiations
Trump conducted a state visit to the UK meeting with King Charles, with the tone described as "pretty cordial" though specific terms weren't disclosed (39:56-41:15). Simultaneously, US-China trade talks in Madrid focused on semiconductors, with China launching probes against Texas Instruments and Analog Devices. The TikTok ownership transfer appears near completion, with ByteDance potentially selling its US presence to a consortium including Larry Ellison's Oracle. Matt notes these negotiations represent a competition for valuable resources, comparing social media distribution to the oil industry divisions of the 1950s: "that's what's going on in the social media kind of information technology space at this point" (47:15-47:25).
Bitcoin Treasury Companies Down
The most dramatic development involves Nakamoto ($NAKA), a Bitcoin treasury company that surged from $2 to high-20s following its merger announcement, then crashed 90-95% from June highs. Matt explains this represents "capital destruction" for late buyers (59:55-1:00:13), with one in four Bitcoin treasury companies now trading below their Bitcoin holdings value. However, he views this positively for Bitcoin's broader cycle: "by rinsing out the speculative froth, this actually in my opinion... helps extend the cycle and go further" (1:00:37-1:00:50). Bitcoin itself only experienced a modest 10% drawdown from 122K to 108K, showing the volatility has shifted to the outer layers rather than the core asset.
🔑 KEY TAKEAWAYS
- The Fed has been political since FDR's 1930s restructuring; current maneuvering is normal not unprecedented
- Trump needs to flip regional Fed branches to achieve policy goals, not just board seats
- Watch for Jerome Powell and Lisa Cook decisions as key inflection points for monetary policy
- China-US negotiations involve tit-for-tat exchanges: TikTok for semiconductor market access
- Bitcoin treasury companies are not Bitcoin - understand the difference before investing
- Speculative froth washing out in derivatives while core Bitcoin remains relatively stable suggests cycle extension not termination
- Due diligence matters: "know what you're buying" especially with complex financial instruments
🔗 LINKS
- 🎧 Subscribe to the Build Weekly Roundup: https://open.spotify.com/show/7bvfjkPjQ67Eugg8EYdoe5
- 🌎 Build Asset Management: https://getbuilding.com
- âš“ Build Bond Innovation ETF: https://bfix.fund
- 📈 Build Secured Income Fund I: https://buildbitcoin.com
📱 SOCIAL MEDIA
- Build Asset Management: https://twitter.com/BuildMarkets
- Matt Dines: https://twitter.com/LeveredUSTs
- Cameron Otsuka: https://twitter.com/CameronOtsuka
- Dave Martin: https://twitter.com/DaveMSocial
