Current valuations for the major cryptos, including Bitcoin, are "miraculous" and prices should be much lower, said Clem Chambers of InvestorsHub.com. Chambers told David Lin, anchor for Kitco News, that there are several other tokens to look at, and in particular, the DeFi space overall has more long-term potential.
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We're back with Clem chambers of investors hub. Very diversified well-rounded investor. Welcome back, Clem. A well-rounded. Well, you're, well-rounded because you're knowledgeable many areas, but, uh, eating is never a bad thing. So now you and me, both you and me both. Let's talk about your macro outlook first.
You've got a look, we talked several times in the last year and, um, you were, you were bearish and stuff. Around the fall of last year, I would say. And then you switched to a more, uh, more bullish stance right now. The S and P 500 seems to have waned in his momentum. People are wondering whether or not, uh, they should be buying the dip or perhaps waiting for more for pullback.
What would you do? Well, I'm thinking the interesting thing to look@istogobacktotwothousandandseewhathappenedafterthe.com crash, because the fed then tried to pin the. Um, in a sideways trend for years and years and years, honestly, we had nine 11 and we had some draw downs and then a crash, but basically for years and years, the market would go back to a level and just trade sideways.
That really was the long-term trend. And I think that's what the fed will be aiming for. Now. Now it's post COVID environment. They've still got all sorts of problems. There's obviously there's there's issues with the supply chain. There's inflation. There's this strange goings on in employment, and there's a lot of repair to be done.
So rather than just keep pumping up, um, asset prices, I think let's try to pin them in a range around this area for quite some time. I think that will be the master plan and there'll be by the dip opportunities. There'll be things that no one's expecting that are bad, that will happen. Um, and therefore I think it is going to be going sideways from here with some dips, maybe even serious steps, depending on people, how people react to the type of that's coming.
You say the fed wants to pin assets around a range. What, how are they doing that? How are they paying? Assets. So it's all right now it's all about money flow. And you know, when they pump it, pump money in up, it goes. And when they don't put money in down, it goes, so they've got pretty simple leavers to Paul and he said they want to get clever.
They just buy assets at different, um, uh, yield, um, terms and, um, you know, trade the curve of, of the, of the bond yields. And, you know, that will. Regulate how much money is flowing in and flowing out. Because I think most people would say these days that long gone is free markets and that the fed is basically cornered the bond market.
And to an extent cornered the equity market too. So they are in control of asset prices and, and it will take a lot to actually take that control away to them from them. And, you know, I'm pretty sure. They've got a, a, um, you know, a master plan, a plan of what's going to happen over the next few years.
Cause it's just going to take three or four or five years for what's happened with COVID to actually get out of the system and be inflation there, all the disruption in, in, um, in the supply chains. Well, that's going to take a year or two to get out. Um, the restocking of a lot of people have a lot of parts of the economy.
Reason for that. A lot of this disruption is that there's been huge to stock in the last two years. So restocking the repair or the supply chain, the removal of high stroke, runaway inflation from the system, getting GDP back to a sustainable level. It's going to take years and years and years, and they will have a master plan for that.
And it's not gonna be assets going up vertically, and it's not going to be assets going down. So it'd be like 2001, 2, 3, 4, 5, 6, 7. It's going to be generally sideways trading and you can check the chart itself after the.com crash. And you'll see, particularly in the Dow, there's a sideways trade and, you know, once you've built things up.
You've got to S you don't want him crashing back down again. You don't keep going up because that's not sustainable. So you want a period of calm and sideways. And I think that's what, um, there'll be aiming for whether they can sustain it or not is another matter if you think they could roughly sustain it, then it's the, by the bit environment, if you think they can sustain it, then you're going to be looking to avoid a crash.
If you think they going to have to keep printing because of fiscal deficits, et cetera. Well, then assets are going to go through the roof personally, I think. Sideways, I guess the days, well there's short days of buying whatever stock you want because stocks only go up or gone. Are you saying absolutely right.
Cause if you look at those, that period stocks only rise. That's the period of facts. That's the period of biotechs exploding. That's. No, not today. Today. There's no, SPACs, you know, the meme stocks. I mean, you know, what's amazing going on. They're not nothing special. That air seems to us come to a close and it's come to a close because the market bubbled and, you know, the fed is, has shut it down by talking taper and they will undoubt to be taped for somewhat, even though it's money coming into the markets.
But, you know, th the it's clear that pretty much everybody in government one way or the other is now pretty worried about inflation. The trouble is for them is that there's not much of a way of controlling it unless they do austerity. And they're not going to do that. Oh, they now, so they're in a little bit of a corner when it comes to inflation.
So we should expect seven, 8% inflation for two or three years out. At least I think that's one of the big things to factor into. You mentioned that before to me now let's talk about particular assets that might be able to hedge against those levels of inflation. Clem, what about cryptocurrencies? Well, crypto's very interesting because the, a lot of people think the reason gold is not going up is that Bitcoin is the fastest horse.
So, you know, if you want to get out of Dodge, you jumped on the fastest horse, not the most reliable one. And that's the one that gets all the attention. All the money flows. I don't actually buy that at all. Um, and crypto is very interesting. This also very high and, you know, is it going to be driven much higher from here?
The main ones on Ethereum. I, I doubt it, but I'd be a bad. And for me, the market should be a lot lower. It's almost miraculous that it's where it, where it's at, as far as I'm concerned, if you want to play in that market and you know what you're doing, and you really should know what you're doing before you start gambling with crypto at the defy, Ethereum tokens is the place to be because that's where the pot is.
So rather than going all the way. And then getting squashed, maybe with cryptic going down 20%, you can go in on, in a risk off manner. I smaller positions and look to get much bigger pops in those smaller tokens. So for example, one of the few that I've been holding is one called trouble because I expected to get listed on Coinbase while it was listed last night and off it went 50%, but you're not going to get an overnight rise in something like Bitcoin or 50.
Whereas good token, like wearable, which is easy to understand, easy to study up on, easy to realize it was going to go. And Coinbase offers that sort of opportunity. And there were others out there like that in the second tier, the, in the tokens that are worth, you know, hundreds of millions of low billions.
So I think anybody wants to play that game. It should have small position sizes and be looking for the next hot token or, or, or. I want to talk about how to invest in and the defy space, your theory I'm in particular, Peter Lynch, one of the great investors had a quote about Tommy. Well, he had several quotes, but one of them here, I'll just read this market.
Timing is speculating and a rarely, if ever pays off. Now, I want to get your take on whether or not that quote applies to cryptocurrencies because you see volatile moves on the order of 25 to 30% on a weekly bi-weekly basis. Is it important to wait for. We're trying to time bottoms, but in time tops, local tops and local bottoms kind of find the opportune time to get in, or does it really not matter because if you're a long-term investor and if you're investing into defy thesis, would it really matter if you're getting in now or, you know, couple of thousand dollars, less per coin, I'm talking about Ethereum, for example.
Um, we'll tell the not hard amateurs to give them their money because there's no point market timing because you can't, it can't be done. So I'll see investment professionals should look after your money at great expense to you, and we'll do it all the way so I can understand why market professionals say, you know, you can't lock your time and it is very difficult, but investing is, is not so difficult.
If you have a thesis or an idea, this is going to happen because of. That's going to happen because of that. If you have those ideas and you think long and hard about them, you will have no problems, market timing in a, in a, not to the second or to the day or to the week, but over the medium term, it's a short short-term this rate.
And, you know, market timing is very hard. It's a skill game and therefore you just can't run in and go, oh, that chart looks like it's going up. I'm going to buy that chart. Ooh. It looks like it's going to go down. I think it's going to go down. As I said, if you think it's going to happen, it isn't, if you know it's going to happen, then you should think about playing and, you know, with crypto, um, the best way to invest in crypto is to play with it.
The small cell. So, you know, you could get on one of the exchanges, a Binance, I know you will, the American viewers would probably get shot dead by the law enforcement if they dare think about that. But if they get an exchange and they start get the wallets and put a few dollars into Ethereum or Bitcoin and start swapping them on exchanges and start reading and just playing with it at very, very small, um, No numbers.
So tens of dollars, rather than tens of thousands of dollars over a few months, they will get the idea and then find it easy to invest, but you can't do it by reading books. You've got to do it the Montessori way, learn by doing, and that's the best way to start in crypto. Just play with it for a few months and you'll get, and, and the light bulb will go on and you'll get it.
And you'll be. I'm going to go back to your analogy about pick one, being the fastest horse in the race, even fast horse, even the thoroughbreds Nita, take a breather and rest every once in a while. Do you think it's in a cryptocurrencies are in a rest period right now? Uh, well, I mean, I think they've done amazingly cause they were definitely crashing and then something happened and they zoomed up again and that was probably a mixture of China banning it.
And so that's for lots of people in China had to buy into Bitcoin before it's too late and lots of Afghan people running for the Hills or not Afghan Hills, but you know, running out of Afghanistan, loaded up with assets and putting them on as Bitcoin to get on that plane. So I think I had a lot to do with that.
And, um, you know, I, I think that turn around, that was a root pivot. So now it's, the question is, is stick on the break the all time high. And I can certainly look at the chart and see it breaking this all time high, but I'm about, I'm waiting for it to go on to 20,000. And I think my whole. No actually, is it going to end up as pet food?
Um, in the, in the short to medium term, but that's not what the market's telling me. The market's telling me you could easily go through the all-time high because that's what the market is saying. And like, in the same way, as I think gold is fantastic, the market is telling me it sucks. I don't understand why gold sucks.
I mean, everywhere you look there's inflation and I mean, it's even more extreme with plan. Because this whole net carbon, zero world reliance on platinum capitalists and you know, apparently in the next end year, but before we're old man old before I am anyway, um, you know, there's going to be no internal combustion engine cars, it's all going to be running off batteries and you know, and it's going to be a hydrogen world and they're all needs platinum and where's platinum going exactly nowhere.
And it doesn't work in my head. Well, just, just on that note, I don't think we're both going to be old men by the time that happens. The UK where you're from, they didn't, they just banned the sale of combustion engines or cars with combustion engines after I think 20 or 2035 or 23rd, if something, something impossible to actually make happen.
But isn't California banning. The cornea has already done that. New York state has just in the last month or so made a similar ban, uh, Eve cars only after 2035 for all dealers within the state of new. That's a halfway through the evening. I mean, that's ridiculous. All right. So in our final segment, I'm going to give you a few themes and a link back to everything.
We've talked about a few themes trends that the world is heading towards. Uh, and then I'll just ask you to, uh, pick one or two assets to invest in accordance to those themes. So the first one would be the, a shift towards electric vehicles. Like we just discussed. I mean, whether it's. It's going to happen by a certain deadline of 14, 15 years, whatever that may be.
That is the trend right now. How would you play it? Exotic mass metals, rare earth metals in particular rare earth is going to be hot, hot, hot, um, platinum group metals because of the hydrogen economy. That's going to be a big thing. Really? All these exotic places. I don't think you can go wrong. Um, in the medium to obviously the world seems to want to patch up on this fat, slower than me, because it's obvious that if you're going to make all these flash batteries, you're gonna make all these electronic systems, you're gonna make all these capitalists, you're going to make all these, you know, crazy fuel sales, et cetera.
It's exotic metals that make all this stuff go by an impolite. Iridium railroads. I can't even pronounce half of those guys, so you'll have to put up with that. But that's the stuff that, without that, you know, none of it's even, even thinkable and doable central bank, digital currencies are emerging cross the entire world.
Basically. It's not just one central bank doing it at several. How's that going to impact the crypto landscape? How would that impact your investment portfolio? Well, ECI. The dollar is already a digital currency. 90% of all dollars are digital. So essentially central bank digital. Every single major currency is already a central bank digital currency.
Now, if you're talking about programmable money, if you're talking about destroying fractional reserve banking, by enabling people to put their cash into crypto wallets, that aren't actual clearing banks or what the American equivalent is, uh, that will be the day. Now the, the whole mark of crypto is.
Right. So once upon a time, all the private investors got FOMO piled into Bitcoin. Then the corporates got FOMO and they will, some of them piled into Bitcoin. Now the governments are getting FOMO and they say, they're going to pile into a digital currency. Well, they've already got one of them. So what are they going to do?
Make programming money, programmable money. I don't know. We'll see that. The risk of, of crypto is vast the cause it's just a never ending hackable environment horizon. Yeah, it's not a risk. It's a risk surface and governments don't like risk and they don't want to risk surface that they can't control.
They don't want some hoodie in Russia empty in the central bank. Do they now, so I think you'll hear a lot of yada yada, yada, yada, about that. And zero execution I tried to in China, nobody wanted it. I couldn't give it away in China. Okay. Well, they can give it away and they still didn't. Nobody wants to do.
Well, w we'll follow that. We'll follow that trend and see if there's any changes in that. Uh, finally fiscal spending and fiscal policy, we're seeing an era of fiscal dominance, uh, even, probably perhaps even more so arguably then monetary dominance. And so we've got, we've got a situation where the us treasury is on part is on, is on track to spend.
One 1.3, $1.5 trillion over the next decade or so. And this will have tremendous impacts on all corners of the American economy, perhaps the world economy. So when you've got governments spending the way they are now unprecedented amounts, how would you invest? Well, it's a very good question because you know, where is the escape hatch from this.
And if you look at China, they shut down lots of escape hatches for people to actually sidestep. What's going to go on in China. So it's a very difficult, I mean, you could have said in 1932, oh, you know, that's, let's put all our money into gold because the American government's going to go belly up because the wall street crash, guess what they came round and said, we'll throw you in jail.
That's your handover vehicle. So it's a very, very difficult, um, thing to, to think about. And I think it's the $64,000 question right now. My solution to it. I wouldn't say it's particularly genius and that's a lot of gold, a lot of raw materials because ultimately you can't match it raw materials out of the ground with funny money.
Because the costs are real commodities are commodities because they are equivalent or in a sense, and anti equivalent to pay for money. You know, it's a hard, hard cost thing is digging copper out the ground. And the more you devalue your money, the more that the nominal value of a commodity. That's why there are commodities.
So if you have a hundred percent inflation, we cost twice as much or cost twice as much college costs twice as much. So a hedge against inflation is definitely commodities in one form or another. If you want to get leverage, I suppose you've got to go to the list of producers, but it's actually much better not to have inflation and to have economic growth, to make money in markets, because then the numbers going up.
Not just funny numbers caused by inflation, but after all great economic catastrophes like wars, there's always a massive bout of inflation and COVID is. Oh, but this modern equivalent of being through a war. So we're now going to get the follow on inflation that one would have got at the end of second world war at the end of the first world war at the end of the American civil war.
And at the end of the war between the Romans and the Carthaginians it's what happens when governments get into straits, they debase the currency and here we are. Alright. Excellent. Clap. Thank you so much for your insights today. I appreciate. Thanks very much. Thank you for watching Kitco news. I'm David Linn, the upcoming future blockchain summit coverage is brought to you by cook finance, a revolution and defy asset management.