Nvidia slips, Trump Media soars, Marathon CEO: Catalysts

On today's episode of Catalysts, Hosts Brad Smith and Madison Mills break down the trading day's biggest stories, from Nvidia's (NVDA) decline to headwinds in the space industry.

After hitting record highs, Nvidia is on track for its third consecutive session of losses. Harvest Portfolio Management Co-CIO and Nvidia shareholder Paul Meeks expects Wednesday's shareholder meeting to "make investors feel comfortable that there is a long runway" as the company touts its AI initiatives. He believes CEO Jensen Huang's remarks will cause the stock to rebound from its period of decline.

While Nvidia has spearheaded the tech sector rally, Glenmede Chief of Investment Strategy and Research Jason Pride believes investors should adopt a more "disciplined" approach to their portfolios amid current market (^DJI, ^IXIC, ^GSPC) conditions. He explains that the current environment necessitates two key investor behaviors: "be comfortable with not chasing the trade," and "actively rebalance portfolios." He believes that this approach allows investors to trim exposures and manage investment risks effectively.

As the 2024 presidential election lies just five months away, shares of Trump Media & Technology Group (DJT) are trading higher ahead of Thursday's debate between President Biden and former President Donald Trump. Yahoo Finance's Senior Columnist Rick Newman breaks down what viewers can expect from this historic face-off and key topics likely to dominate the debate.

Marathon Digital Holdings (MARA) CEO Fred Thiel provides insight on how the cryptocurrency market views both administrations, explaining that Trump has positioned himself as a pro-bitcoin (BTC-USD) candidate while "the Biden administration has been very hostile to bitcoin."

Finally, as part of Yahoo Finance's Space Race: Investing in the Final Frontier series, Space Capital founder and managing partner Chad Anderson joins the show to give insight into the next big catalysts for the space industry.

"Today, there's a new world order with the US and China collectively accounting for 80% of orbital launches and 75% of total funding over the last ten years," Anderson explains. He adds that because of geopolitical tensions, the US and China know "very little" about each other's programs, and reveals that China's innovation has allowed it to become a leader in the last two years.

Catch up on Yahoo Finance's special coverage as part of this week's Space Race: Investing in the Final Frontier series.

This post was written by Melanie Riehl

影片文字紀錄

It's here in New York City.

Happy Monday, everyone.

I'm Madi Mills.

Let's dive into the catalyst moving markets today.

Investors keeping a watchful eye on treasury yields ahead of Friday's key PC print the warning signs emerging in the bond market signaling higher for longer potentially to come.

We're going to explore what this could mean for the Federal Reserve.

Also in video looking to recover some losses after Friday's volatile session.

The chip maker still see positive assessments from Wall Street.

We're going to speak with a shareholder about the recent sell off and bitcoins losses piling up as demand starting to cool off a little bit.

We speak with the CEO of marathon digital holdings about the next big catalyst for the digital currency.

But first, our big story is and video on track for a third straight session of declines the slump nearing $300 billion in losses for the tech giants market cap.

And this comes ahead of the company's shareholder meeting this week.

One of those shareholders joining us now we've got Paul Cio of Harvest portfolio management.

Paul, it's great to speak with you and thanks so much for taking the time with us this morning.

I'm curious from your perspective, how you are digesting the movement that we've seen with NVIDIA stock over the last couple of days?

And does it change anything about your thinking when it comes to your holdings of NVIDIA?

So last thing first doesn't change anything.

I think what's happened, you know, the stock has just done so well.

Now there's some talk about uh peak data center A I sales and of course, that has to happen at some point.

But I think the near term to even the intermediate term over the next couple of years, Madison is um you know, I don't think there's really much uh controversy about that.

I think what happens on Wednesday when they have their annual shareholders meeting at some point in the presentation and it starts at 9 a.m. pacific time.

Uh Jensen Wang will strut to the stage that was not released in the press release for the event.

But I imagine that's the case.

It's essentially um industry standard and will probably again articulate the wonderfulness of A I.

And the key here is to make investors feel comfortable that there is a long runway yet.

So I think what happens here, we have some profit taking some worry about uh peak sales.

I think we'll have a reversal and the stock will rebound based on the remarks from Ceo Jensen Wang on Wednesday morning pacific time.

Well, it's interesting Paul because I wonder if part of the problem with a company like NVIDIA is that the growth has so outpaced expectations and it's such a new name for folks to get used to as part of the problem that the math of analysts behind this name is sort of lagging.

And therefore we don't have a great insight and transparency into videos growth story.

That's right.

That's right.

Because if you believe, and I think you must believe that the company will continue to upside numbers.

I mean, they have scorched the uh quarterly numbers for about as you know, a year and a half ever since the advent in November 22 of chat GP T. And I think you can probably expect more of the same.

The interesting thing is the company does not preannounce numbers because what happens when you start preannouncing numbers and then you stop, you can see what happened a couple of quarters ago with Super micro S MC I, which is another company in this space.

So I expect them to continue to beat numbers.

I expect them to continue to push a narrative which I do believe is true that the A I chip boom will last longer than people will expect because it'll be much more large language model building.

And then inference uh work at all of the hyper scalar and the other guys that are spending tens of billions of dollars to continue to build out A I infrastructure.

So that helps give some insight into what you look at to suss out the growth story for NVIDIA.

But when you see market moves like the ones we're seeing right now, do you take that as a buy signal?

Now, what I'm looking at is I'm pretty comfortable with the fundamentals and I'm pretty comfortable that there will be a fundamental, uh, push upwards on the annual meeting later this week, Wednesday morning.

Uh, what I'm looking now is I do want to buy some more.

I'm inclined to buy some more, but I'm looking for a technical support.

I had thought it was gonna be about the 20 day moving average, which is actually where the stock is right now.

And so now I'll probably wait to see if it settles lower at the 50 day moving average.

So comfortable with the fundamentals, not comfortable with the technicals and just looking for some technical support where the stock finds support for a couple of days, the volume dries up a little bit and then I'm uh inclined to go back in because I think that's the right move.

I don't believe that this is a stock that should be shorted here or even sold here.

Yeah.

Well, it's interesting too.

We've been hearing the question about concentration valuation.

I feel like that's been the reigning cry from a lot of notes over the past year or so, Paul, to what extent does the valuation piece play into your overall investment outlook?

Not just your NVIDIA holdings but your overall portfolio when it comes to tech in general.

Yeah, the, the way I look at it and of course, you have to talk about NVIDIA because it dominates my sector.

Um is the stock expensive, maybe a little bit expensive after its most recent run before this uh drop off.

Uh but it had not been.

And if you take a look at probably the closest compare uh here is Cisco systems building out the internet infrastructure in the very late nineties, very early two thousands and that stock got up to over 100 times earnings.

And so here we are at 3040 times earnings.

Is it cheap?

No.

Is it a little bit expensive?

Yes.

Is it egregiously expensive?

No.

So I actually think that um I'm not so worried about the valuation and I'm looking for that uh technical stability before I go back and add to the position.

So, of course, my position is already quite large.

All right, we're gonna have to leave it there.

But thank you so much Paul for joining us, really appreciate it.

That was Paul Meeks Cio and also a shareholder in NVIDIA and moving on here, the Russell 2000 outperformed the broader market at the end of last week as tech stocks continue to be under pressure, of course, led by NVIDIA.

Could this be the time for a catch of trade led by broadening out joining us to discuss and here on set, we've got Jason Pride, Chief of Investment Strategy and Research at Glen Mead.

Thank you so much for joining us here.

Jason really appreciate it.

I know you just heard our conversation with Paul and I'm curious what stood out to you in terms of the concentration we're seeing in tech versus a strong desire to have a broadening out?

But are we seeing evidence of that broadening out really starting to happen?

So I think it's probably going to take a little bit of time for us to actually see that broadening out quite often when we see innovation cycles, what happens is we go through a period of hype uh through which valuations get stretched often to a point that's hard to discern.

At that point in time.

I heard you talking about how hard it is to value a hyper growth issue that that actually is a problem within investment analysis.

Everybody is grappling with today with things like NVIDIA.

But quite often following that hype, there is often a period of disappointment, meaning that we build up high expectations for some issues that eventually get to a point where they just cannot be met.

And that period disappointment shrinks the valuations.

And then maybe later in time, if you look back at the internet cycle, you know, we went through this and eventually there was a realization on the other side.

10 years later, all that hype actually ended up being true it ended up being true 10 years later rather than within that exact time that everybody was hoping for.

So that may play out again this time.

So, is it less that you're saying, don't be bullish on the stock?

It's more that you're saying there might be a buying opportunity to get in when it's cheaper.

Exactly.

And I think that's where investment discipline comes in.

These sort of environments require investors to.

Number one, be comfortable with not chasing the trade.

And number two, actively rebalancing portfolios because what's going to happen if you have a broad market exposure and you have something like NVIDIA or other tech stocks lifting ahead within the portfolio, that's actually going to provide you an opportunity to trim back that exposure and buy the things that have underperformed up until then rebalance the portfolio.

Let's not eliminate that exposure but reduce that exposure and manage the risk.

That's what this sort of market environment provides opportunity for.

What is a healthy rebalancing look like.

Then the healthy rebalancing can simply be you establish targets for your invest parameters up and up front.

You then look at those targets at a later point in time and look at what is off from those targets.

So if NVIDIA has run beyond your typical portfolio limits of exposure, bring that back to your portfolio limits of exposure.

If equities have run beyond your target equity allocation, bring that back to your target equity allocation that allows you the opportunity to buy other things, buy other things within equities, buy other things within broad asset classes, like fixed income of all things.

I mean, fixed income today is offering 5% plus yields and opportunities for investors.

We haven't seen 15 years, right?

So there is an opportunity here for investors to rebound their portfolio back to a more disciplined portfolio allocation.

It's interesting, I know that your conversations are much more high level than this.

But when I talk to my mom about her 401k and she's getting advice about going international being in bonds.

I'm like, well, you're missing out on the NVIDIA rally, right?

How do you tell people like me?

Don't think about it like that.

The thing is, I think that's a, that's actually a misconception.

If you own that, you're not missing out on it.

You're just managing the risk associated with it by buying into the small caps, by buying into Japan International, other areas of the market.

You're actually taking advantage of all the opportunities that exist around the spectrum and not just one opportunity and you're still missing out on that one.

You just maybe minimizing your risk associated with it.

It's about hedging the greed.

It sounds exactly.

Exactly.

But I don't want to hedge the greed when I'm see what is NVIDIA up here to date?

166%.

I think that's the trap that investors quite often fall into as you look in the rearview mirror over a very short period of time and say, hey, I'd really like that.

Well, you are not guaranteed that what you've recently seen is going to recur over and over again in the future.

In fact, likelihood is it doesn't.

And by diversifying your exposure, by maintaining a discipline and investing, you actually maximize your chances of getting that in other areas right past performance, not indicative of future results there.

I do want to get your take on what we're seeing in the broader economy while we have you here, obviously P ce data coming up on Friday, what would you be expecting to see from that data to indicate a timeline for the fed?

Yeah, so we need to see continued moderation in inflation and it could be step wise, it could be little pieces over time.

The fed wants to see it.

We think the FED needs to see about three months in a row of inflation just kind of gradually, you know, seeping down from these recent higher rates.

The beginning of this year was hotter than they wanted.

They had to back off from the previous expectations for faster rate cuts.

They are now looking at 1 to 2.

We actually think they probably end up doing two this year.

There's a good chance they'll end up doing two because the inflation data is probably going to moderate as we go through the rest of this year and three months in a row just because of the way the seasonality works because of the way um the interest rates work and the, and the impact in the housing components, the way we're already seeing it work in the wage numbers and the services inflation.

Last month's services report within CP I was actually shockingly low.

It was the first one we've seen out of the last four that actually surprised to the downside.

So if we see a couple of months like that, the fed can look back and they have an excuse on the table to bring rates down from what they already considered to be overly high levels and start targeting, start getting down to where they ultimately want them to be longer term.

The housing data was a little rough as well.

Recently, in terms of housing starts housing supply, to what extent do you think the fed's relationship to housing is something that potentially needs to change moving forward?

Given that hire for longer is keeping people stuck in their houses longer and that is potentially in some ways fueling inflation.

I don't know that I really think of it as the Fed needing to change the relationship with housing.

I think this is a complication of monetary policy that they are always dealing with and they're dealing with it more today than ever before because people aren't locked in at lower rates.

Uh This is a typical, we think a typical late cycle environment uh we actually thought we were gonna have more difficulty earlier.

We even thought that a recession was probable uh last year that is now extended into a late cycle.

Late cycle is typified by GDP.

Running ahead of expectations of running ahead of potential.

That's where we are now, inflation running hot.

That's where we were interest rates coming up and market valuations being high.

It doesn't mean that we have an immediate recession, but they're dealing with handling a late cycle.

What is probably going to be a late cycle slow down here and trying to push that late cycle that expansion out as long as they can.

That's a difficult thing for the FED to do.

So I don't really think of it as something they need to change their thought process about.

I think this is just a difficult thing for the FED to manage.

It's just how it is given the, how it is that they have at hand, given that and kind of zooming out here as we wrap up.

What do you think is the biggest potential risk for the economy in the US as the FED does start to fight inflation?

Is it something that is, you know related to monetary fiscal policy domestically or is it a geopolitical international challenge?

One of our biggest concerns has been around the monetary policy.

How tight it keeps the overall markets, how much pressure that puts on the average consumer so far?

We haven't seen that play through because debt markets have actually stayed reasonably good.

Equity markets have been very good for corporations.

You haven't seen that typical flow through in the capital markets that actually impacts the rest of the economy.

The other thing that we haven't seen is we haven't seen the lower end of the consumer suffer quite as much as it typically occurs in a recessionary environment.

This time around, they have had a lift of wealth that occurred from the past stimulus that has actually saved them the cycle.

So far, we are keeping very close eyes on the consumer.

We're seeing a rise in some delinquency rates, but really, it's looking like just back to normal, we're going to be keeping our eyes on that lower end consumer because if that pocket gets larger, that pocket that's having difficulty gets larger.

That could be one of the tipping points.

So real quick, things like the pricing more and value meals at some of these lower end fast food chains.

That's not a concern to you.

Actually, I think that could be uh uh a saving grace here.

That could be one of the things actually brings the inflation down, allows the fed to see the inflation data coming lower and allows the fed to start backing off on their, their interest rates.

We're basically, we've waded through a cycle where the fed raised rates, fiscal policy provided an offset to that.

Now we need them to cross each other.

We need fiscal policy to back off at the time that monetary policies, you know, uh downside to the economy backs off as well.

If those cross at the same time, we could actually extend this late cycle quite a bit further.

Really appreciate it, Jason, thank you so much for coming in and thanks for the great commentary.

Appreciate it again.

That was Jason Ry Glen me in chief of Investment Strategy and research and taking a look at Apple shares this morning.

They are still moving to the upside here up about three quarters of a percent.

And this comes as the European Union is charging the tech giant under a competition law regulators are saying that Apple's App Store prevents developers from steering customers towards alternative ways to make purchases for how these charges could legally impact Apple moving forward.

We've got Yahoo finance his very own Alexis Keenan here.

Al thanks for popping in.

So talk to me about the impact here that we could see on Apple and just kind of the legal ramifications as well.

Yes.

So the the European Commission, the antitrust regulator across the pond, they are very serious about their antitrust laws and they rolled out the Digital Markets Act earlier this year, it came into effect and the fines can be up to 10% of global annual revenues for Apple for any other company.

So if you're looking at $383 billion in Apple's case, we're talking about $38 billion so no small risk there.

Now, Apple is the first company to see a charge under this Digital Markets Act.

And what the EU the EC is saying is that it's a preliminary view that the company has breached the law.

And what they say is that Apple's App Store is blocking app developers from telling their users how to find their own.

So the company, the app developers, the the company carrying their content that they are blocking them from telling their users how to get content outside the app store at a lower price.

That is a no, no under the EU law, it is ok for Apple to take a fee when a new user signs up through the App Store, right?

So they get a chance to monetize the fact that they're bringing customers to the table, but then they're not allowed to stop the companies from steering customers in other directions and other places to get.

So on top of that, the EC is also opening investigation on another layer on top of Apple over their app developer fee that charges about a half a euro for app installs that exceed 1 million.

So those larger app developers that are selling a lot more of their content that are getting a lot more traction.

Apple looking into that, but not yet saying that they've concluded that investigation.

Now on top of all of that, you have to consider that the justice department in the US has filed an antitrust suit against the company.

So that is pending new but pending.

Also the EC in March charging the company $2 billion fine for allegedly blocking music streaming apps from being able to do a similar a feature of selling their content through the app store.

And then the E in March beginning an investigation to the way that Apple allows customers to see a choice in their browser and in their search features on the phone.

So just a lot piling up for the company, the anti trust kind of cloud is getting very thick.

And so these are just major allegations to contend with Apple is going to get a chance to respond to these claims and the EC will have to make a decision or they slated to make a decision by March of next year.

That will be uh March following the March where they already had that $2 billion fine you mentioned, which potentially gives investors a bit of a road map about what this fine could look like.

Alexis.

Thank you so much for giving us the great background.

Really appreciate it.

As always, we're gonna have all of your markets action ahead.

So stay tuned for more.

You're looking at some gains across the broader indices here moving to the green.

After some trouble adding into the market open, we're going to cover all those market moves for you.

After the break, a firm getting a bullish call from Goldman Sachs after shift in analyst coverage, the firm upgrading the buy now pay later stock from neutral to buy, calling it the quote leading provider of modern credit solutions that stock up over 7% here in the market.

Open.

Now.

Finances Jared is here with me now about an hour after the open here, Jared, I'm still catching up, but it's interesting with a firm.

I mean, the stock is down over 30% year to date here, but seen some upward movement given some of these upgrades and also the combination of the the partnership with Apple as well.

Right.

Yeah, it's been kind of a tough year for a firm and certain payment processors but not all.

And it's interesting this comes after a deal with Apple.

So they got a little tie up there.

Online transactions in the US are going to be a bigger factor in their earnings going forward.

And Goldman is specifically citing their underwriting processes.

They look at this Apple deal and they're looking at gross merchandise volume and specifically they want to see that growth rate over 15% over time.

And if you dial down to shorter time frames, I actually have a separate analysis by Bloomberg Intelligence saying that uh that Apple is going to help a firm push past 26 27% gross merchandise volume over time.

So specifically 29% this year and that is based on consensus of 23.7.

So that's quite a jump there.

What you're looking at on your screen is the intraday price action.

Here is the to date that you were just talking about Mattie.

And you can see indeed under by about 34%.

And I'll just put a max chart because this is a company that came to market in 2021.

It was a tough time because 2022 was that huge, huge bear market where so many disruption stocks, which I would I would include this a payment disruptor as well.

We got caught up in that, but you can see over the last year been making some movements, uh basically doubling its share price.

So still in the weeds with respect to its 2021 high.

But moving in the right direction.

Well, Jared, we want to get you on another ticker here we are watching because Ups has agreed to sell its freight brokerage business, coyote logistics to Rx.

So that's going to be for over a billion dollars and Ups had originally paid 1.8 billion to purchase this company back in 2015.

So we've got another deal here.

What do we know?

Yeah, and I got some analysts.

Let me just jump straight to the commentary there.

Barclays which rates the stock in overweight saying that the deal looks favorable from a valuation and commercial perspective for.

So then we have Jeffries with a buy saying that this deal adds significantly to Rx's scale supplement.

I can say that they're going to be about the third largest broker of their type in the US.

And then we have Bloomberg Intelligence saying this transaction will make North America's third largest freight broker.

So there you go.

That's where that statistics come from.

And Bloomberg also noticing that the purchase price was a little bit lower than what they would have expected.

1.4 to 1.8 billion.

You mentioned that they paid UPS paid 1.8 billion in 2025.

So maybe it's looking like a deal.

Now, let's go to the Wi Fi Interactive one more time where I'm gonna chart.

Uh This is the, uh one year price action.

Let me show you year today.

This is interesting.

You can see we're kind of in the weeds here, uh, in the red here until today.

And now, uh, with this, with this bump up of about 18% finally in the green for the year.

Uh, let me just put a max chart on.

You can see this is a company that recently lifted listed within the last couple of years.

You can see it is now close to its all time high there and I'll just show you a UPS chart as well.

This goes back over 20 years, but just to show you that UPS is significantly off of its highs from a couple of years ago as well.

All right, Jared.

Thank you so much as always for bringing us those market moves.

We really appreciate it.

Moving on to another big story.

We're watching the risk of higher Chinese electric car prices in the European Union might be easing after both China and the Eu reportedly agreed to start talks to negotiate on those tariffs.

The Eu had threatened China with tariffs of up to 38% earlier this month.

So let's get into it.

We got Yahoo Finance Pro joining us with the details.

And pro as I mentioned, we heard news about a potential 38% tariff earlier this month.

What do we know about the new details when it comes to this negotiation and how that could impact the producers as well?

Well, the new information is that China says we want to out a deal before the July 4th deadline.

So that's, that's the day that these tariffs go into effect.

So they're saying that China wants to in fact scrap all the tariffs.

Not surprisingly, and they're actually dangling some carrots of Bloomberg reporting that they're talking to German automakers about, hey, if you advocate to push the end of tariffs, we'll, we'll, we'll reduce or remove tariffs on your large German like luxury automobiles and the German auto block is fairly, pretty strong in the EU and the EC so they could have some sway as to how this can go down.

But like you said the big things are huge tariffs on these, on these Chinese ev makers, 38% could be, that could be the highest but also uh cars like bybyd cars give a 17% tariff because they've been working with the eu officials to kind of figure out how legitimate are these sort of uh uh the money being transferred from Chinese uh governments to these companies?

Like they're trying, there's an investigation going on and some automakers were helpful with that and they get lesser tariffs.

So that's sort of where the dance is.

That's where, where the negotiations are right now.

But you know, look, Chin China wants to expand their retaliatory tariffs on, you know, uh Spanish Ham and, and brandy and, and those German automobiles uh like I mentioned and, and what, what does this mean for if let's say the EU makes a deal with China, what does it mean for the, the buying 100% tariffs on China Chinese EVs here and also the, the Canadians want to impose tariffs on Chinese evs as well.

So yeah, it does affect those Chinese ev makers which are also traded here in the US.

Uh You have to imagine large tariffs like that, both mostly in Europe would be a huge sort of sales detriment.

Well, that's exactly what I wanted to get your context on because the 100% US tariff on Chinese EVs was a little bit more symbolic.

Eu tariffs on Chinese EVs what does that do to the car maker?

Like a Byd?

And what does it do to a Tesla?

Well, Tesla will have its own sort of, they petition for their own tariff regime based on their Chinese auto wheels that are, that are exported into Europe.

But if you're a Chinese even maker, you're the vast majority of your cars are sold in China, the mainland.

So that's not gonna hurt them that much right away.

But they've been trying to expand and grow their presences in, in Europe and they're huge in places like Brazil and, and other places like that.

So if you see other markets start to enact some tariffs, retaliatory tariffs or sorry, protective tariffs, then yes, it would be a huge concern for Chinese.

Interesting and it's indicative of a broader tariff war that we are seeing kind of heating up potentially even more.

So as we head into the US election and past that and what that will look like.

So a lot to monitor there, but we appreciate you joining us as always.

Thank you so much.

Well, coming up Bitcoin with the second biggest weekly decline in 2024 where the crypto markets be heading next, we'll cover that and more with the CEO of Marathon Digital after the break Z in.

Now on another big story we're watching which is Bitcoin already in the third worst week of the year here.

You can see that is down a little over 4.5%.

I want to take a look at Bitcoin the year to date.

So obviously having a lot of success up 38%.

You can see though in the month of June, a little bit of capitulation heading towards that trend line similar to the kind of dip that we saw in early May.

It will be a big question mark as to whether or not Bitcoin is going to pass that threshold, given some of the downward pressure that we've seen as of late, we already know that the start of this week for Bitcoin in the broader crypto market has been rough as well.

So investors keenly watching this digital asset to see what the moves might look like moving forward and for more on exactly that, with regards to crypto markets, we're going to bring in Fred Marathon digital Holding, Ceo Fred.

Thanks so much for being here as always, really appreciate it.

Talk to me about this downward pressure that we are seeing in Bitcoin.

I'm curious from your perspective.

Is this being driven by a demand issue or is it being driven by macro questions about what might be coming next for the Federal Reserve?

Well, it's a couple of things going on.

One is you have the German government, uh The Criminal Bureau is selling supposedly about 50,000 BT C. They've already sold a few 1000 of those Bitcoin.

Uh So that creates a bit of a supply shock.

Then you have Mount Gox bankruptcy, supposedly will be distributing the Bitcoin in that bankruptcy, which is a very large volume of Bitcoin starting in July.

Um You have macro expectations impacting generally the risk off assets.

And so Bitcoin has been very correlated to risk on uh as of late.

So there's a lot of things going on as well.

Post having you have miners selling a large proportion of their um Bitcoin that they're mining as a way to continue to fund operations and uh their tents at expansion.

But we are seeing uh hash rates starting to come off, the uh difficulty rate will likely have a um significant downward adjustment uh here in the next uh at the next update.

But I think right now what we're seeing is just basically a lot of supply in the market.

And uh you know, we've seen about $1.2 billion of outflows from the ETF S. So generally demand is kind of waiting.

Some analysts have predicted that Bitcoin could drop down to about 57 as a support level.

Uh We'll have to see but clearly, um you know, Bitcoin right now is challenged at getting up beyond that kind of 68 69,000 level.

And one thing that's interesting for you as CEO is that the performance of this asset directly plays into the performance of your company stock, given the interconnectedness of the two and for our viewers some context marathon digital engaging in mining digital assets, focusing on the Bitcoin ecosystem in particular.

How do you navigate that as a company executive?

What is your thinking on being so heavily impacted by the performance of this digital currency that does have a history of being really volatile?

Yes, Bitcoin is historically, very volatile.

Uh you deal with it by having a very strong balance sheet we have amongst the strongest balance sheets in the industry with, you know, over a billion and a half dollars of Bitcoin and cash available to us and uh not too much debt.

At the same time, we focus on diversifying our business.

Uh We started a portion of the business which is a technology division which focuses on selling digital infrastructure technology, uh especially liquid cooling technology, which is applicable to the A I space just as much as it is to the mining of Bitcoin.

We have a full software stack uh for the Bitcoin mining industry as well.

Uh that we've begun selling and um have announced some recent partnerships around and then we have a part of the business called energy harvesting uh which focuses on leveraging um Bitcoin mining and digital asset compute as a way to essentially generate revenues through alternative means.

An example of that is last week, we announced that we have started a heating project in Finland.

So we're heating 11,000 homes with the heat from our data center And in that way, we can subsidize the cost of our electricity, essentially lowering the cost for us to mine Bitcoin by being paid for heat offtake.

Um The same token, we are generating Bitcoin using methane gas off of landfills which lowers our cost to mine Bitcoin.

So as that business begins to build over the next few years, we expect it to contribute significantly to lowering our cost to mine Bitcoin.

Whilst most other miners are just paying for electrical fees off of the grid, which whose prices aren't going to go down.

Uh However, through this energy harvesting model, we can essentially subsidize our cost to mine Bitcoin.

Well, Fred, it's a great point on being defensive and also I know you're working to diversify your revenue streams as well.

I'm not going to ask you to comment directly on your competitors, but I am curious about a competitor of yours that's buying NVIDIA H 100 computers diversifying by renting those out to clients.

I just want to get a sense of your thinking on that move.

And do you think that that's something that you would prioritize moving forward as A I starts to and has really been driving the success of this market and individual companies within the market.

I mean, it's a great question.

So a number of our colleagues in the industry think that Bitcoin mining and HPC or A I cloud uh have similarities.

They do, they both require a lot of power.

But I'll give you an example of where those similarities end.

If you have 200 megawatts of power and you're going to build that out for A I cloud compute the infrastructure, the buildings basically that you need to build are about $800 million.

And the uh NVIDIA equipment is about $3.2 billion.

That's $4 billion in total to use that 200 megawatts for Bitcoin mining will cost you about $200 million.

So there's a very big difference in the amount of capital you have to have.

And as you can see the companies that really have gotten into this space are having to receive large capital injections from their customers core.

We've, you know, did a deal with core scientific uh where they're essentially financing the infrastructure build out and they're providing the compute.

Um you know, hud eight recently today I think announced 100 and $50 million capital injection from a core Weve affiliated entity.

So what we're seeing is people trying to get into this business, but just look at Nvidia's product announcements and think about technology obsolescence here.

If the NVIDIA equipment is going to get four times more powerful at a similar power load, meaning the power required isn't going to go up by four times, then why would you be buying machines today?

If within 24 months, you'll be four times behind the power curve.

And so I don't believe today it would be prudent for our shareholders, for us to be investing capital equipment, Capex roller um in buying a bunch of NVIDIA machines only to have them obsolete within 24 months.

That being said, providing a equipment for the infrastructure, the picks and shovels if you would for A I compute are very interesting and that's what our technology division is focused on doing with our liquid cooling infrastructure because you need immersion cooling technology to keep these A I rigs cool, especially the next generations of NVIDIA machines and other machines that we expect to see coming.

The other thing that is much more interesting, I believe is the inference part of A I, you have essentially the learning models that you need to train and then you have the inference inference is where the user really interacts with.

Uh A is if you think about chat GP T when you ask a question, it's running an inference query, that's where the real volume will be and that will be at the edge of the network in very different types of data centers, running different types of machines.

And that's an area we're very interested in Fred.

As we wrap up here.

I finally wanna get your take on the upcoming presidential election.

I'm curious from your perspective as an executive in the digital currency space, which candidate would be better for your marketplace, Trump or Biden.

Um So president or former president Trump has obviously positioned himself as the candidate that is pro Bitcoin.

He believes that all Bitcoin should be mined in the US and has been very open to his relationship with Bitcoin miners and people in the space.

The Biden administration has been very hostile to Bitcoin, you know, through its various agencies.

It's the banking uh and the so called operation choke 0.2 0.0 whether it's the sec, etcetera.

Um I'm sensing a a thawing of the cold if you would from the Biden administration, as they realize there are 55 million voters in this country who care about crypto.

That's a pretty large voting block.

And while nobody in this industry wants it to be partisan, I mean, we believe that, um, Bitcoin serves the needs of everybody.

It doesn't have any political color to it.

Um, we think both parties should embrace it and in Congress we've already seen the Democrats um, in both the Senate and House of Representatives embracing Bitcoin and crypto legislation, you know, the S A repeal and then, um, and the Fair Markets Act, both of them, you know, bipartisan attempts to get something passed and that were blocked by the White House.

So I think that, you know, what we're going to have to see is more bipartisan work on this to get it work passed.

But it really is a bipartisan thing.

It's not one party versus the other on this.

Yeah, it's certainly become a bit of a political football as we head closer to November.

Fred.

Thanks so much for being here with us.

Really appreciate your insights.

That was Fred Thiel.

He's marathon digital holdings CEO.

Now coming up, it might seem soon to talk about that upcoming election.

But the first debate is kicking off this week, we're going to talk about what to expect from President Biden and former President Trump.

On the other side of break, President Joe Biden is set to face off against former President Donald Trump in the first debate for the 2024 presidential election this Thursday for more.

We're bringing in Yahoo finances, Rick Newman.

Thanks so much for being here with us.

What can we expect to Thursday?

Well, we all know what we're looking for.

Everybody's going to be tuning in.

I think this will get a large audience to see if any, if either one of these guys has a senior moment.

I mean, that's what we're all looking for, right.

Let's be honest.

Um They're both going to try hard not to do that obviously.

So I, you know, the most important thing that could happen is that one of these guys slips up in a way that becomes viral and somehow, you know, defines the election from here, uh from here on, uh, if that doesn't happen, uh What Biden needs to do is he needs to gain ground with voters on the economy and on immigration.

Those are his two weakest issues.

Uh, and Trump is probably gonna spend a lot of time if he sticks to the plan, uh, trying to remind voters about inflation under Biden and that there was no inflation to speak of when Trump was president.

And also gas prices were cheaper.

Uh, but, uh, you know, this is pretty unpredictable.

I mean, I think Biden is very likely to try to bait Trump and, uh, Biden would win if, if Trump, if he can sort of get Trump to go on these rants and he, he seems sort of erratic and he starts going off on tangents, which he does at his rallies.

Uh That's probably what Biden is gonna try to do.

Uh, and Trump is, you know, what he should do is try to convince the viewers that he is presidential, um, that he is somebody they can see in the, uh, in the office for another four years.

So I think it's gonna be pretty interesting as presidential debates go.

I mean, there's a lot of tension about whether these guys can even stand up for 90 minutes, but we've seen them stand off against each other previously, obviously very four years older now.

And, yeah, I mean, they've both gone through a lot you can say in the past four years.

But what do we know about?

What does the previous performance tell us about what we could expect on Thursday or is, are you saying it's completely different given I, I mean, I think it's important that the format is very different from what, from what people are used to seeing.

And that is because of what happened in 2020 with uh Trump, for example, uh always interrupting Biden in that, in that first debate, uh that Dana Bash famously called a shit show after it was over.

Um It was a complete mess and it was, I mean, it was hard to watch.

So they're gonna, I mean, they're gonna be able to turn off their microphones.

I mean, I, so how, so I think we're gonna be, it's gonna be interesting, how many times does each candidate get muted?

Um And um does that start to seem like a bias?

Like, I mean, and by the way, Trump Trump is already, the Trump campaign is already um sort of like setting low expectations, like maybe Biden will actually do, ok, maybe he won't be as senile as we think.

Um So the spin is always just as important as the thing that actually, that actually happens during the debates and just for what it's worth, um presidential debates tend to the, the incumbent often does poorly in presidential debates or at least in the first presidential debate.

Uh This happened with Obama in 2012, for example, he was really flat in his first debate with Mitt Romney.

And that probably is because the, you know, the president is busy being the president and maybe he's not doing as much debate prep as the challenger.

So, I think that is, that is something to watch for.

Um, and again, and who's going to seem like they really have control of their faculties?

That's what we're looking for, I think.

Well, Rick, while you're here, I want to get your take on another story we're watching and that is shares of Trump media and technology because they're moving to the upside in a big way today.

You're looking at gains of over 21% here.

What do we know about what's driving that?

I don't know why the stock goes up or down.

I mean, this is a, this is a small company with a small percentage of shares outstanding.

Um because so much is controlled by insiders in the lock up that ends in September.

I think of Trump media as a binary bet on whether Trump wins the presidency or not.

And it seems like every time a poll shows Trump a little bit ahead, then the stock goes up and every time he's a little bit behind, for example, during the, after he got convicted, he came down a little bit in the polls.

Trump Media group actually went down.

It had been as high as 50 I think recently and it went back down to 25.

So it lost half its value.

Now it's up.

11 important thing to know about this stock is that it's, it's hard to short this stock right now.

Um, because so many shares are in lock up when the lockup ends, which I think is in September, there's gonna be a lot, it'll be much easier to short this stock and that is gonna give us a better, uh, sense of how the market actually values this stock.

So that's coming.

Um, and, uh, my guess is if Trump loses, I do not see the point of this company.

I don't know why this company exists if Trump is not president and his political career basically is over.

So, um that's a big risk for people who hold the stock.

All right, options.

Traders set the date on your calendar.

September, you can get in on shorting the stock if you so choose Rick.

Thank you as always, really appreciate it.

Thank you so much coming up here investing in the space economy.

We'll break down the biggest catalyst, fueling the space race on the other side of this break.