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Antony Pompalino: What is Your Read on the Launch of the Bitcoin ETF?
Kevin O’Leary: I like it as an indicator that the regulator is warming up to finally providing guidance to the regulation for the real thing. I don’t like it as a product. The futures market is very efficient, but sometimes when the prices are very volatile, not so much.
So, looks like it is great that it is happening, it is clearly reflecting in the overall price of Bitcoin with the optimism globally, but the US regulator is finally going to get behind the cryptocurrencies not just the Bitcoin. And, it is the first baby step.
Frankly, you can buy the ETF with the real thing underlying up in Canada right now, and other countries are doing that. Even with the Ethereum now in Canada. So, you know hopefully within 24 months, which is my time view, we are going to have the real thing. Bitcoin inside ETF wrappers allows people with equity portfolios to buy it and get price exposure to the price of bitcoin and cryptocurrencies.
It is not a bad thing; I don’t want to invest it that way. Why? Just buy Bitcoin and hold it in a decentralized wallet. And, I think that is the most efficient way to do it.
What are the institutions saying to you about ETF? The majority of the institutions and the majority of them who run large brokerages are not there yet. Just the fact that it is a futures contract in itself, just futures contracts are for credited investors only. Anyways. So, it is a small subset. And, they can buy it on their own with an online account. But, the major houses have not approved this yet.
When we think about monetary policy, the fed actions and kind of inflation talking about your view right now, we have now had multiple months of over 5% and CPI, core inflation at 4% and we continue to get this idea of lot of people saying it is all transitory, how do you think about inflation? And, then also what the Feds action should be moving forward.
So, I spent a lot of time in this as it is reflected in my operating clause in 34 private companies that I own. Everything ranging from gym equipment manufacturers, commercial kitchens, insecticide companies, this is how broad the portfolio is. What is happening right now is supply chain issues and it is reflected in what I called transitory inflation. I can’t get parts of a ship more outside of Los Angeles for 6 days, because it is struck in a jam getting in to the port. We are not operating the LA port 24×7 which is insane in itself, but because I can’t get those parts, I am scrambling to buy parts so I can finish off manufacturing equipment and I am paying as much as 30% to find those parts in the secondary market. That is reflected as an inflationary increase in my cost of goods. In every aspect, it is expensive than it was 18 months ago!
