MSTR Stock: Epic Rally on MidEast Deal + STRC Needs Low Rates + Buys More + BTC IS UP—Perfect Setup?

[00:00:00]Hello everybody. This video is entitled MSTR stock epic rally. It does seem like we're getting a rally today on the Middle East uh accord unsigned deal. We got to wait until Friday for that. And so there's risks associated with waiting of course. But uh this begs the question, is this a perfect setup to get back into MSTR? And of course, I want to talk about the buy of the day, the big buy of the day. But before I do, let's talk about Bitcoin.

[00:00:34]Why is MSTR stock going up so much today? It's going up so much today because Bitcoin is doing well. As I've always said, when Bitcoin does well, MSTR will do very well. When Bitcoin does poorly, MSTR does very poorly.

[00:00:50]Remember it dropping to below 120. That was wild. my opinion, why is Bitcoin doing so much better right now? Well, I mean, it's it's a theory. To me, it's as good as any. You know, people argue, Bitcoiners argue about the theory. To to me to me, it's because Binance is headquarters headquartered in Abu Dhabi.

[00:01:08]And I think um um you know, they have a big impact on the price. And of course, uh that impacts Abu Dhabi, that situation in the Middle East, much more than it impacts uh people say in the US for example. Um but Bitcoin is pumping back. Everything is going back up. The indices are wild today. We've had so much whiplash. This is the fourth day of epic whiplash either to the downside or to the upside to the downside to the upside. So don't get wiped out. The key to be being well to doing well in this market is to never get wiped out. Be very careful with margins with options especially shortdated options because the market is wild. Today strategy is outperforming Bitcoin by quite a bit. We are up 9% versus 5.6%. 6%. Normally we should be up about 7 and 12%. We're up 9% the underperformance of last week. We are gaining back right now. Crypto fiang greed looking good. Looking much better back almost in the middle of the quote unquote fear territory. And you can see even the pan greed. This is on coin market cap of course zooming. You can see the speed at which we recovered from extreme fear was really really strong.

[00:02:19]And so I really like to see uh that the sentiment is amilarating. We have better sentiment on Bitcoin. Let's talk about the buy. So is Sailor's version of do nothing, which is what I've said in my prior video that he needs to do nothing.

[00:02:31]Is that version of do nothing? Is that 200 million a week? Is 200 million a week the equivalent to nothing for Sailor? And I think it is because, you know, compared to the size of their 850,000 Bitcoin balance sheets compared to that size, 200 million is not that much. He split um the ATM proceeds of course. How did he get the proceeds for 200 million? He got them from the MSTR stock ATM at 1.22 MNAV. I love it very much. This is not delution. Why do we use this MNAV? Why is it 1.22? Because most of the debt is perpetual. This is what the bears don't get. The debt is perpetual. When the Bitcoin standard finally comes in 2040 or something, the debt on stretch, the yield paid by stretch will be very close to the risk-free yield. That's the whole theory as to why we use enterprise value in the MNAV calculation because stretch will eventually be most of the debt and that debt will eventually have a very very very small yield. So that's the beauty of this and yes, I firmly believe it's 1.22 22 MNAV. But people make simplest calculations and they will tell you that you're getting diluted entirely ignoring by the way the BTC level network yield for a BTC level. Sailor creating a yield for every Bitcoiner. Sailor creates a yield even for people who dislike him but own Bitcoin. Um and so that's a very good thing that's very creative at 1.22.

[00:04:00]And then people will be complaining of course that he did of ATM to do the cash to to to raise some cash to put on cash reserve. raising money for cash, I'll say it again. I said it in my prior video, is is technically neutral. When you do the math and you raise money, to put it in cash, it's neutral. It's it's a it's it's a neutral procedure when you raise money for cash. It's a Wall Street stereotype that printing new shares often leads to delilution, right? It's it it it and even even with stockbased comp I'm not going to go there again but even with stockbased comp if you give stockbased comp you're not giving cash to somebody sailor is printing its own MSTR currency the operation half half of the printing of MSDR stock went to cash is neutral the other half went to Bitcoin Bitcoin is accretive we accrete at a 1.22 to MNAV. And by the way, Sailor looking pretty smart right now, buying 100 million of Bitcoin at 63,000.

[00:05:01]That's a winning move because my back of a napkin math tells me we're up 7 million already on that 100 million Bitcoin buy. So, to me, this is his version of doing nothing. He's going to do these small buys until we'll get Stretch to trade back at 100. And of course, that is the big question right now. Stretch needs to get back to 100.

[00:05:24]stretch will in my view slowly get back to 100. We just need time. This has been a market for the most patient investor.

[00:05:33]It's all about patience in this market and we we're all running out of patience quite frankly with all of the grace ones that we're getting. But that's going to be the 2020s for us. Patience, patience, patience. Um VWAP um to get back to 100.

[00:05:47]Of course, we need patience because we need Bitcoin to get back up. Um, we need the market to notice, but we also need to increase the yield most likely per VWAP. In my view, the yield is going to increase to 11.75 at the next date.

[00:06:00]Stretch back to 100. What do we need again? So, we need the value of the Bitcoin stack to grow. We need we need to get back to a high BTC rating well above a three preferably. So, we need Bitcoin to be back at, you know, 75,000 or something like that. That would really really help stretch. Although 67,000 helps stretch quite a bit already. We're up on stretch. I don't want to undermine that. We need the cash reserve growing back. Well, we'll see about that, right? My my my case about the cash reserve is that stretch didn't really get much credit from the rating agencies from having that cash reserve.

[00:06:34]Sailor is replenishing that cash reserve. So, that means Sailor seems to believe the cash reserve helps with the credit agencies. That's fine. It's only 100 million. Compared to the size of this enterprise, it's not that much. So, that's fine with me if you want to try it again. But but I'm always worried about the cash reserve. The cash reserve might just be helpful to buy back uh some of these other convertible debts. I believe there some cash to buy back the convertible debts. Maybe that's a that's a better way to look at it. Um but we'll see. And then we need the general yields to drop. And this past week the 10ear dropped. We're very happy about that.

[00:07:07]This morning the 10 year was way down but the yield are going to be the yields are going to be on hold now. until June 17. June 17 is very important. It is the first speech, first speech from the new chair of the Federal Reserve, Kevin Walsh. Hopefully do hopefully a darish Kevin W. He Walsh. He was he was picked by Pois, right? And he was he was he was picked most likely because of conversations that they had where where he said he was darish or something like that. Not not that not that straightforward. They're supposed to be independent, but my guess is that president of the United States would not pick a dove because let's face it, every president wants a dove in that post in that role. Um, and and and you know, he he now holds the key now that now that the higherend story seems to be behind us. He holds the key to Bitcoin getting higher, to the market getting higher, and to Stretch getting back to 100 because if he's doubbish, the yields will drop. If the yields drop, stretch will go back up, racing back towards 100. I also want to note Poly Market here talking about the odds of a rate hike in 2026. You may remember that was the narrative of last week. And of course, the media did not forget to let you know when we broke 50% on poly market saying, "Oh, most market participants now expect a rate hike in 2026." That is not the case. Now you only have 32% chance of a rate hike in third in 2026. So this is free falling and this is free falling of course has hormuz the straight of for Hormuz was reannounced opened yesterday even without final signatures on the so-called Middle East deal even with final signatures it seems like it's opening up and you have oil crashing right now so that means the energy the cost of energy is going down and if the cost of energy is going down that means inflation should go down that means that the Fed chair can have validation to drop the rates can have some assurance that the rates can be dropped. So, so we we see a lot of bullish thing. I think the market is going to be on hold until Wednesday, midday, towards the end of the day really. And Wednesday, end of day, we either rally even more or we crash. And that all depends on this one person, um, uh, Fed chair Kevin W, which of course is an unelected position position, an elected official, but I believe in the first year, it looks closer to an elected official in the first year because he was chosen by an elected official. So, so I I actually put a lot of credit on his first meeting. I think the the first meetings, the first few meetings of Worsh will be the most legitimate meetings of his career and and and and I think it's very very clear that Americans want the rights to drop. And so hopefully he keeps that into account and then of course the other central banks could follow his lead. Although with the ECB, it's looking that like the ECB had really really bad timing raising back the rates just 2 days before a deal was announced and before the price of oil is dropping. So anyways, but that's that's classic ECB for you. Anyways, this was not investment advice. This is not financial advice. This is only entertainment. I'm hoping you were entertained and only entertained on this channel. Please like, please subscribe, follow me on Patreon, follow me on X.

[00:10:37]Thank you for watching and have a wonderful wonderful