On today’s show, billionaire Michael Saylor discusses his big move into Bitcoin. Additionally, he goes into detail on how he defines Inflation, risk premiums, and hurdle rates. Michael Saylor Let’s come back to this inflation definition. I think that you can define a bunch of buckets, and the definition of inflation comes down to what’s your aspiration? If your aspiration is to be a billionaire, then the definition of inflation is the rate at which scarce assets that are going to continue to appreciate are going up in price. So what’s the best investment idea? Bitcoin. How fast is it going up in price? 200% this year. We have hyperinflation, and pure at property and pure liquid money, hyperinflation. We have inflation in scarce and desirable assets. Houses in the Hamptons are up 50% in 16 weeks, the price of a house in the Hamptons. What is that? Well, when you buy a house in the Hamptons, you’re buying a scarce piece of property on an elite real estate network. When you buy a Bitcoin, you’re buying a scarce piece of property on a global liquid monetary network. Which is better? Michael Saylor Well, clearly Bitcoin is better, because Bitcoin is liquid, global, fungible. I can take it anywhere on earth, and there’s no property tax on it. And I don’t have to worry about New York state taxing my property away from me. So given a choice between investing 20 million in Bitcoin or 20 million in Hamptons real estate, clearly the rational thing is buy 20 million worth of Bitcoin. But if you’re a New Yorker and you’ve decided you need to get outside of Manhattan, well, all the wealthy New Yorkers, they all go to the Hamptons. It’s a social network slash real estate network. It’s scarce. Ergo, prices go up by 50% in three months, and the transaction volume goes up by 50%, and they’re turning over, the entire real estate business is up 100% year over year. The real estate agents are doing great. Michael Saylor Is there inflation? If your aspiration is to live an elegant life of affluence in the New York area, then you have hyperinflation in that real estate market. So, and of course they do, right? Go to a wealthy New Yorker and say, “Well, there’s no CPI inflation, nothing to be concerned about here.” You’ve just got to decide what you want to put in the basket. I think that when you work your way through it, you conclude, you can look at it as like five buckets, right? There’s the affluent bucket, and you’re seeing 20, on average, across all assets. It’s like that 20 to 24% M2 monetary supply expansion rate. So you could say that the inflation rate for just a broad basket of assets is like 20% or so this year, or 24%. That’s why the stock market’s at an all time high, because people that have liquid monetary energy, they want to buy those assets, and they’re all bidding against assets that are reasonably scarce. Not totally scarce, by the way. Michael Saylor The reason that those assets aren’t going up as fast as Bitcoin, the reason that gold is outperforming maybe the S&P, is because the S&P, they’re producing more securities, they’re producing more convertible debt and more equity. And so it’s not quite as scarce. It’s harder to produce the gold, but of course, it’s really hard to produce the Bitcoin. So what you’ve got is everybody’s surging to acquire more assets. The asset supply isn’t expanding as fast as the money supply is expanding, ergo the price is going up. That is inflation of assets, or asset inflation. I’ll just call it cost to capital. Subscribe to We Study Billionaires podcast show: https://open.spotify.com/show/28RHOkXkuHuotUrkCdvlOP To access our show notes, courses or forums, go to theinvestorspodcast.com. ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ADDITIONAL INVESTING RESOURCES: Ask the Investors: https://www.youtube.com/playlist?list=PL_xlkwLDH1F8msJn1pD3z95KuFLQWPuf- Asset Allocation Course: https://www.youtube.com/playlist?list=PL_xlkwLDH1F9coxc1aExB8xbw9daFDF6P Real Estate Investing: https://www.youtube.com/playlist?list=PL_xlkwLDH1F_p00VYv3psJ8rhDAGOvR5W Millennial Investing: https://www.youtube.com/playlist?list=PL_xlkwLDH1F-NVcnR47rMkT0ByTWQBvBf ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ Download Stig & Preston's 1-page checklist for finding great stock picks: https://www.theinvestorspodcast.com/form-youtube-checklist/ Have a question? Get your voice heard on the show: https://www.theinvestorspodcast.com/your-questions/ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ ⏤ DISCLAIMER: This show is for entertainment purposes only. Before making any decisions consult a professional. This show is copyrighted by The Investor’s Podcast Network. Written permission must be granted before syndication or rebroadcasting.