The conversation explores the evolving landscape of finance and investment, focusing on the rise of the "degenerate economy" characterized by gamified and prediction-based markets, and its implications for investors and society, particularly in the context of changing regulatory environments and global economic shifts.
Mind Map
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Hello.
>> How's it going? >> Good.
>> Good.
>> Good. Happy I'd say happy Friday. God,
>> happy Friday.
>> It's only Tuesday.
>> It feels like it's 2030.
>> Yeah. Well, it's only 2026 and I'm
excited to get your projections for
2026. But first of all, I heard you say
recently that there has never been a
better time to be 60. Can you tell me
why that is?
>> Cuz I have money. Uh, no. The uh
>> I don't
>> Everybody's so mad, so I figure if
they're going to blow each other up, at
least I had 60 years. Yeah. And um but I
I own and operate two millennials, so
I'm worried about them.
>> Mhm. I'm a millennial. >> Yes.
>> Yes.
>> Yeah. Well, I just turned 33 yesterday,
so Oh,
>> what does that mean for me?
>> I mean, just pray.
>> All right. Well, let's get into the
degenerate economy because this is the
phenomenon that you have been talking
about for many years now. And for those
not familiar, do you mind just giving a
little bit of an overview of the
degenerate economy? You have a degener
so hard to say three times fast.
Degenerate economy index. Let's talk a
little bit about actually what it is
before we get into some outlooks for 2026.
2026.
>> Yeah. So, so when I grew up investing,
they had sin economy. So, it's not
anything. It's just a word. uh sin sin
back then was how how how uh how nice
America was. It was uh booze and
cigarettes and and here we are in 2026
and we've got um sports sport casinos
have turned into sports betting which
have turned into prediction markets. um
you know five years ago they wanted to
put Vlad and Baiju in jail for confetti
and now you can uh you know trade single
stock futures and parlay it with a
basketball game. Um, so I think the
degenerate economy is just humans will
go to the lowest common denominator
pretty fast if you let them. And not
judgmental. Degenerate economy, I think,
is it's just a funny term. My my two
millennials are degenerates. One vapes.
I'm not happy about it. Uh, one invests
in in Robin, you know, in Robin Hood and
doesn't bet. And um you know they got
the cell phone, they've got the cloud,
they have the app store, they have Door
Dash, Uber. Um what are you going to do?
Like that's their Elvis Presley. They
they they they live on this machine and
uh they're going to we're all going to
eventually deal with it, right? But
right now it's it's you can get what you
want. You're like a Roman emperor. And
so that's where I I I talk about the
degenerate economy. And like any
economy, there's the good, the bad, the
ugly. Mhm.
>> And we're seeing it all, but uh you're
not going to unwind it. You know, the
New York Stock Exchange, CB, CBOE, C, I
mean, uh NASDAQ, Robin Hood, great companies.
companies.
>> Would you say it's the modernday version
of investing for millennials and Gen Z's?
Z's? >> Um
>> Um
>> talking about some really interesting
stocks there, right?
>> Yeah. I'm the gener is is not like GME
and and AMC, right? That was true DGEN.
That was just people the world had been designed
designed
uh for unfortunately that moment of co
and everybody happened to be staring at
the same two buttons at the same time
buy or sell GME you know Robin Hood
checks in the mail um people at home
people people just optically designed to
push buy or sell. Um, and now we're in a
leanback moment of the markets. Like
that was that that was the that was the
the top, let's say, of the mobile, let's
click buy or sell. Uh, now we're in this
this market unfortunately with del
globalization. Trends have changed, but
also with the globalization comes the
fact that you can't just stare at four
stocks or fang. Um, that was a moment
that was that was an incredible run and
those companies are incredible. But the
world's now looking at Bitcoin, gold,
silver, graphite, like uh uh nuclear
energy, uh AI AI tools are being built
on Claudebot, uh running on Alpaca. You
know, I'm an investor in alpaca. So, you
know, I see what's going on and because
of Stock Twits, we have a million
people, you know, daily talking about
the markets. They move from Nvidia and
Tesla to silver. >> Right.
>> Right.
>> Right. They're not they're not stupid.
They they on stocks they they fast
follow each other into these trends.
>> You talked about the gamification of
stocks. I think you mentioned the
confetti on Robin Hood back in 2021,
right? Saw the rise of
>> the quaint days of 2020.
>> Yeah. But now we're seeing the rise of
prediction markets. What are you
expecting to see as we go in into 2026?
I know Cali and Poly Market, they're
inking deals with with major companies
left and right.
>> Yeah, like us, Stock Twits, we we we uh
super bullish on prediction markets. Um,
uh, and I didn't see it coming. You
know, when I when when I when I saw
Robin Hood the first time and Vlad and
Baju showed me the the product, I was
like, it was so obvious to me as an
Erade uh, investor and Yahoo Finance
person that came into the markets on the
retail side. Um, it just seemed crazy
that it hadn't existed and soon as the
app store came out. So I was all in on
Robin Hood and before that e Toro and
because I had started Stock Twits and we
had an open API um I just I didn't have
the nerve uh or the skills to go or or
or to go build a broker dealer in 2009
20101 and by the way the venture
capitalists were didn't either. The
venture capitalists were all about um
let's build the next Vanguard like
Wealthfront, Betterment. Not not
horrible ideas, but took tons of capital
and the idea was well, we'll just rate,
you know, whoever can get to a trillion
dollars under assets under management
first wins. And that turned out to be
the wrong bet. The right bet was let's
get 10 million people uh trading. And uh
that's how you make money, right? You
get right at the at the at the right
time when everybody's moving one way and
you move one way. with prediction
markets. There's no way I would have if
Shane or if they had walked into my
office and pitched me the ideas like
Howard, you're the you're the, you know,
founder of Stock Twitch early investor
and Robin Hood Toro.
Look at this. And I would have not got
it cuz I don't bet. >> Mhm.
>> Mhm.
>> Right. And so you can't get you can't
get it right. But then, you know, I was
with my son at Wimbledon and he's
picking up a girl on on Hinge and uh I
wasn't and I probably couldn't and uh
I'm betting on the app. I'm betting on
Robin Hood. I'm like, >> "Wow."
>> "Wow." >> Right?
>> Right?
>> So, it wasn't like I'm a gambler, but I
was like, "He's going on a date and I'm
alone at Wimbledon and I'm like betting
on Wimbledon." And it was the first time
I'd done it and I was like, "Wow." And
you know, kudos to Robin Hood for for
doing that.
>> Um, at Stock Twits, I see it completely
different. We're we're we we have all
this great sentiment over 17 years. We
have millions of people using it. And
prediction markets to me are the world's
dealing with how little they distrust
everybody. You know, we went to sleep in
2016 on the night of the election. New
York Times. Anybody like me who's didn't
know much about politics. We were
looking at the New York Times meter,
which is what a prediction market is
today. And it said, "You went to bed
saying 95% chance Hillary was going to
win." Politics aside, that's how I went
to bed. I woke up and Donald Trump was
president and had orange makeup on my
body. I don't know if they're related,
but uh
the uh so who are you going to trust?
forgetting about what everybody says
about media. They were our prediction
market. So no different than Satoshi out
of 2008 crisis. Prediction markets are
born out of the 2016 distrust of media
because we all were looking at the same
stupid bet.
>> And it wasn't even a bet. So it was
opinion. It was New York Times wrapped
around the meter.
>> And so who am I to argue? I think kids
should be at the front page of callshi
and and stock to poly market looking at
what's trending and looking what what
people are betting on not the opinion of
Zuckerberg, Elon Musk, Tik Tok, Larry
Ellison like the people putting their
fingers on the weight and and getting
you aggravated and giving you opinion.
People need to realize they've been screwed.
screwed.
>> You're seeing a lot of these big
companies copying the model now. you
seeing Coinbase getting into prediction
markets, Robin Hood, Gemini, a lot of
these legacy companies saying, "Oh,
that's actually a great idea, a great
business model."
>> Yeah, it I don't know that yet. Uh Stock
Twitch looks at it very differently.
We're partners with exclusive partners
with Poly Market. We I'll give you my
example how I how I see it. Um, it was,
as I warned, as I wrote about on my
newsletter for years, it's much easier
for Robin Hood to be because because I
understood Alpaca, it's much easier for
Robin Hood to become Coinbase and
Coinbase to become Robin Hood. And now
we're seeing it. And now everybody's
>> Why why do you why do you say that?
>> Well, because in the United States,
stocks is a thing,
>> right? And in the United States,
Coinbase was much smaller and that
Coinbase could have integrated Alpaca
four years ago and offer us
>> everything out now, right? That's
>> Yeah, I don't I think Robin Hood and
Door Dash are the closest to being
everything apps. I think America, Fred
Wilson says it. He's a mentor of mine.
You know, Tencent, WeChat, those are
those Chinese and Asians, the constellation
constellation
uh sorry the um there's there's one app
for everything. It's just cult. I don't
know. In the United States, it's very constellational,
constellational,
right? Americans like my son, he'll go
lift, Uber, Door Dash. He's he's whoever
whoever pleases him at the moment. the
Roman Emperor. Um, and so I don't think
it's because they don't trust anything.
They're just so used to this magic wand
and power. U, so it's a cultural thing.
And now Americans are trying to stuff
everything back into an app. I don't I
don't think that'll work. Okay.
>> But everybody tries. It's the unbundling
bundling. As for prediction markets,
they're media. Quick example.
I could care less who's going to win the
SpaceX IPO. What does it matter to me?
But then I I look at a prediction market
one day and it says Morgan Stanley has a
91% chance of winning the IPO. I don't
know why I saw it. Um but that struck me
as like holy I don't know if
that's real or not, but it's a
polymarket bet you can make. So think
about the the media implications and and
and the unintended consequences or how
it changes behavior. So Morgan Stanley
CEO probably walks down to the trading
room and says, "Congrats guys. I don't
know who did this, but like we've got a
91% chance of winning the the IPO." do
not say anything bad about Elon Musk or
I will kill you. Um, on the other side
of the the coin is Goldman Sachs and
their CEO walks into the team goes, "How
the did you lose the SpaceX IPO?
You better get Elon hooked up." And so
>> I met him the other day.
>> Did you?
>> It's pretty cool. Yeah.
>> And are you having his baby?
>> Just kidding.
>> Isn't that the only reason he meets you?
I'm sorry. I didn't mean like I didn't
mean that.
>> I met the Goldman Sachs.
>> He can do it without He can do it
without interport. So, uh,
the, uh, is that why they merged Xi and Space?
Space?
Sorry. So, that was more a knock on him.
So, um, so it changes behavior, >> right?
>> right?
>> And we don't even know if that number
that I saw was real, but so imagine on
Stock Twits, we're partners with Poly.
Imagine on Stock Twits, we have all
these people arguing about things that
maybe aren't related to anybody else. So
on stocks right now the most two hated
stocks are coreweave and palunteer. You
can argue if that matters or not in a
year we'll be able to let our audience
argue and make their own bet and say in
the next 30 days will core weaver
palunteer be down more. No one else can
make that bet
>> except couple hundred thousand people on
stocks. Who does that help? New York
Stock Exchange poly market our audience
gets to do bragging right bets. You know
it's they're killing time. We call it
speculation has become entertainment. We
can we can judge it. We can it's you
know that's where we're at.
>> I've heard you say prediction markets
are more like media than like
>> I think obviously New York Stock
Exchange doesn't think so. And that's
great. I'm not going to I'm not going to
be a degenerate better. Um but um they
can't tell you they're media companies
because the valuations would be a tenth
of what they are right now.
>> Right. So, I think it makes sense for
them to be doing what they do to
preserve their valuation, which is we're
a financial business. Um, no one wants
to be a media company. I think it's
never been a better time to be a media
company. Only, you know, depending on
your valuation, how you do it. Look at
Barry Weiss just sold for a couple
hundred million building a business on
Substack. And um we just trust media and
along comes Poly Mark and Khi. No one
wants to admit that that's what it's
like, but that's new media. got to get
your take on Bitcoin because we are at a
crypto conference and it's tanking
today. I think it's pretty fair to say
it's down at 75,000. What do you chalk
up the I guess lackluster price action
and also maybe investors moving out of
cryptocurrency into other areas of
investment? Do you see any correlation,
any pattern behind that? Any
continuation as we go into 2026? Is
Bitcoin going to be super volatile this year?
year?
>> What's your sort of outlook? It's still
in your DGEN index. Bitcoin remains there.
there.
>> It's still and it will always remain
there because
it's the it's the thing. >> Okay.
>> Okay.
>> Right. Like um
>> the thing what's the thing?
>> I don't know the uh No, it's it's the
thing that seems to survive. It's it's
um the the um scarcity of it. And and I
think Bitcoin just proves that the macro
people are the people that believed in
debasement and still do believe in
debasement. That was their that was
their vehicle to to express debasement
to make a bet on debasement. So the
supply of access dwarfs right now the
demand and uh it's always supply demand
and you know if it's fundamental you
know you got to be that's money
management I you know I don't I don't
have any true fundamental understanding
of of where bitcoin will be priced but
debasement continues to be a thing in
fact it's accelerating right with deg
globalization so you have degeneracy at
the same time as you have deg
globalization the deglobalization bet is
much bigger bet like it's over my pay
grade that we're talking about border
fighting. We're talking about Canada as
our enemy. Not our enemy, but you know,
we'll kick their ass. But, uh,
Greenland, um, do I have to worry that
my kids are going to be welcome in
Europe or or certain places? These are
new concerns and there's hoarding going
on. So, if you're hoarding and you need
metals and you're worried worried about
raw materials, Bitcoin doesn't really do
you any good as a country. So, what do
they do? And so, so they they're
hoarding their steel, g oil. So this is
just a trade that's gone on cycllically
for a long time for centuries and people
are taking their money out of Bitcoin
too and buying gold silver and the
problem like the thing with gold and
silver and I see it on stock twitz is
there's not a thousand tickers
>> right it's there's you can't go buy
10,000 different ETFs to get access like
you could for Bitcoin
>> um you got to go SLV or SIL so like all
that money just shot into precious
metals because young investors are just
learning that oh there's other ideas
besides just Bitcoin. So, I think it's
just this this continued trade going on
that Bitcoin led the way and gold and
silver and other things are catching up
and you know I think over 10 years
Bitcoin's done much better than gold.
So, it just depends on what the time frame.
frame.
>> Yeah. Bitcoin, everyone always says you
got to zoom out.
>> Yeah. I think you have to zoom out
because you do that with gold. People do
that with gold. >> Yeah.
>> Yeah. >> So,
>> So,
>> regulation. So, we've gone from a very
strict SEC head in Gary Gendler to a
much more relaxed head in Paul Atkins
just in terms of red tape and letting
the markets kind of do what they do. >> Yeah.
>> Yeah.
>> Um, you know, what's your take on how
that's going to be for the markets going
forward? I know you've had some, you
know, thoughts on that. I've listened to
your podcast. you know, is it good for
the markets and the economy to to have
this sort of just, you know, I don't
think you use the word free-for-all, but
it's kind of sort of what you implied.
You said, um, you know, no rules equals
chaos. I don't think that there's no
rules, but I did an interview the head
of the SEC and the head of the CFTC last
week, and their whole shtick basically
is, um, you know, the least amount of
regulation, the the most light touch as
possible, but still effective
regulation, but not overregulate. Is
that something you think will be
effective as we continue with this administration?
