• 00:00MATT: WELCOME. ALIX: THANK YOU FOR HAVING ME. MATT: IT IS A PLEASURE. MORE THAN $10 BILLION -- $10 TRILLION GLOBAL ETF INDUSTRY. SPECULATION THAT THE SEC APPROVED ITS ETF ALREADY. ALIX: VOLATILITY REMAINS FOR TREASURY YIELDS. WE WILL SHOW YOU HOW TRADERS ARE USING TLT. MATT: WALL STREET'S. THE MUTED DESPITE THE SUREGE -- SURGE IN YIELDS. ALIX: ERIC IS WITH US, LOOKING AT THE FLOWS. ERIC: MOSTLY BULLISH. $3 BILLION IS GOOD NEWS. DTI IS THE VANGUARD BID, TOP TWO. AND THEN YOU HAVE TREASURIES. -- IS WHEN THE SONG IN AN ATTEMPT TO BUY DURATION, WHICH HAS NOT WORKED. BEN SASSE, ESG HAVING -- AND SUUSE. LET'S LOOK AT THE OUT ONE WHAT, A BIT OF A BAD NEWS IS WHILE BE IS - HYLB WAS CHEAPEST UNTIL SPADER GOT FEVER. SOMEONE MOVED INTO THE SPADER ETF. THERE IS A COST OBSESSED TREND WITH ETF'S. NATURAL GAS GETTING BEATEN UP. PEOPLE PROBABLY GETTING ENOUGH PAIN AND MOVING OUT. LET'S HAVE IT TO THIS BLACKROCK ETF. NEWS THIS MORNING THAT ISHARES WILL BE APPROVED BY THE SMC. THAT IS NOT TRUE. BOTH S.E.C. AND BLACKROCK DENIED IT BUT IT HAS BEEN PART OF THIS PUSH TOWARD APPROVAL WHICH IS MOVED UP THE DISCOUNT FROM 50% UP TO -15%. THIS IS BEEN A PROXY FOR HOPES OF APPROVAL. LAST FRIDAY, THEY SAID THEY WILL NOT APPEAL THE LOSS TO GRAYSCALE. THESE PRODUCTS ARE TRADING ON THIS NEWS THIS MORNING BUT A BIG 7% REP IN YIELD. MATT: A LOT OF PEOPLE WERE HITTING THE HEADLINE. I THINK THAT -- BEN ZINGE HONEY REPORT BUT ALL PROVED TO BE UNTRUE. JOINING US NOW IS GAMES SEABIRD AND KAILEY LEINZ. HER CRYPTO PROGRAM AIRS TOMORROW AT 1 P.M.. JAMES, HOW DID THIS HAPPEN? DID IT RULE FROM THE GRAYSCALE PEOPLE FAMILIAR STORY INTO THIS? JAMES: IT ALL HAPPENED FROM A TWEET. AND IT RIPPED, RIPPED THROUGH EVERYTHING. THEY BUNCH OF SOURCES -- A BUNCH OF SOURCES STARTED SETTING THAT IT WAS APPROVED. PROMINENT PEOPLE WERE TWEETING THAT IT WAS APPROVEDE. ERIC AND I BOTH SEND OUT TWEETS SAYING WITHOUT THIS WAS FAKE NEWS. I SPENT THE 10 PLUS MINUTES SCOURING WEBSITES. ALIX: THAT DOES NOT SOUND LIKE LONG. JAMES: I WAS WATCHING BITCOIN GO UP TO $30,000. I WAS LIKE I'M PRETTY SURE THIS IS FAKE BUT I AM NOT GOING TO SAY SO PUBLICLY UNLESS I HAVE SOME CONFIRMATION. THE SEC HAD A DEADLINE ON FRIDAY TO FILE FOR AN APPEAL IN THE GRAYSCALE. WE WILL GET MORE INFORMATION THIS WEEK. IT WOULD NOT HAVE BEEN COMPLETELY INSANE BUT IT WAS UNLIKELY IN MY VIEW. ALIX: KAILEY, YOU ALSO LOOK THROUGH THE SEC FILINGS. WHEN WILL WE ACTUALLY GET THE MEANS? KAILEY: THAT IS THE MILLION-DOLLAR QUESTION. THE SEC HAS DEFERRED MAKING DECISIONS RECENTLY. THEY ARE FACING SOME DEADLINES. I BELIEVE IS IN JANUARY. THEY DECIDED NOT TO APPEAL THAT RULING WHICH FOUND THAT THEY WERE ARBITRARY AND CAPRICIOUS IN DENYING GRAYSCALE'S ATTEMPT TO CONVERT INTO AN ETF. FEELS LIKE CRUNCH TIME BUT WE KNOW THAT GARY GENSLER AND THE SEC HAS RAISED CONCERN ABOUT MARKET MANIPULATION AND FRAUD IN THE CRYPTO MARKETS. THAT IS WHY THEY HAVE NOT APPROVED BITCOIN PRODUCTS IN THE PAST. WE WILL SEE IF THAT CHANGES GOING OVER IT AND WHAT MAY MAKE A DIFFERENCE TO THE PARKING GIVEN THAT WE HAVE -- TO THIS MARKET, GIVEN THAT WE HAVE SEEN SOME WORK SAWS. CLEARLY THERE IS ANTICIPATION AND EXCITEMENT THERE BUT GIVEN WHAT WE HAVE SEEN WITH EITHER FUTURE ETF, IT REMAINS TO BE SEEN WHAT APPROVAL MIGHT MEAN FOR THE CRYPTO MARKETS. MATT: IT REALLY IS JUST A ONE MILLION-DOLLAR QUESTION, MAYBE $2 MILLION. WHAT DO WE KNOW, JUDGING FROM THE PRICE ACTION AS THIS FAKE NEWS RIPPED THROUGH THE MARKET, CAN YOU TELL US ANYTHING ABOUT WHAT WE CAN EXPECT ABOUT AN APPROVED ETF'S CLONING -- CLOSING PRICE? JAMES: WE THINK IT WILL HAPPEN BY THE JANUARY DEADLINE BUT WE DO NOT KNOW WHAT THE NEXT STEPS ARE FOR GRAYSCALE. WE COULD SEE SOMETHING BEFORE THAT IF THE SEC IS FORCED TO DENY FOR DIFFERENT REASONS OR APPROVED BEFORE THE JANUARY DEADLINE WE ARE WAITING TO SEE WHAT HAPPENED. THIS WAS A DRY RUN FOR WHAT WILL HAPPEN IF THESE THINGS GET APPROVED. THAT WAS A REP. OUR SAID -- ERIC SAID RIP ON LIVE TV. AS AGGRESSIVE. A LOT OF PEOPLE WERE NOT EXPECTING IT. MORE WILL BE READY IF IT DOES HAPPEN. IT GAVE READERS A PLAYBOOK, SIGNALS MAY BE THE BEST TRADERS A PLAYBOOK, SIGNALS THE MARKET MAY NOT BE READY FOR THE TEACHERS ETF WENT LIVE ON THE SAME DAY. WE THINK THE SAME WILL HAPPEN WITH THESE ETF'S. WHAT HAPPENS AS FAR AS FLOWS? THERE IS LIKELY TO BE A LOT OF MONEY THAT PLAY. ERIC: KAILEY, YOU HAVE INTERVIEWED GARY GENSLER. HE HAS ALWAYS BEEN THE ONE STOPPING THIS. AFTER THE LOSS TO GRAYSCALE, HE IS MOVING ASIDE, LETTING THE STAFF TAKE OVER. THEY ARE BULLISH ON THIS. THEY ARE WORKING WITH THE ISSUERS AND GIVING THEM COMMENTS. WE THINK THIS IS A GOOD SIGN THEY WILL BE APPROVED BY THE JANUARY DEADLINE. ARE YOU HEARING ANYTHING DIFFERENT? KAILEY: GARY GENSLER ALWAYS SAYS HE IS JUST ONE OF THE FIVE MEMBER COMMISSION. THESE OTHER COMMISSIONERS COULD BE TAKING STEPS THAT MAYBE GARY GENSLER IS NOT. WHAT HE HAS CONSISTENTLY CITED FRAUD AND MANIPULATION CONCERNS. BUT IT IS A QUESTION AS TO WHETHER OR NOT THE COMMISSION AS A WHOLE DECIDES IT IS TIME TO APPROVE. HE ALSO IS RELUCTANT TO COMMENT ON ONGOING LITIGATION. YOU DO NOT ALWAYS GET A LOT OF NEWS OUT OF GARY GENSLER BUT MAYBE WE COULD HAVE SOME FROM THE SEC SOONER RATHER THAN LATER MATT: THANKS FOR JOINING US. KAILEY LEINZ IS MY COANCHOR ON BLOOMBERG CRYPTO, TUESDAYS AT 1:00 P.M. SHE ALSO COVERS CONGRESS IN WASHINGTON. DEFINITELY WORTH YOUR WATCH. JOINING OUR CONVERSATION ON ETF'S AT LARGE IS JOHN DABNEY , FOUNDER AT ASTORIA ADVISORS. I AM NOT GOING TO ASK YOU TOO MUCH ABOUT CRYPTO. BUT THE REAL ACTION IN ETFS HAS BEEN IN RATES, INCREDIBLE TO WATCH ALL YEAR, ESPECIALLY SINCE IT HAS BEEN A HORRIBLE YEAR FOR TREASURIES. WHAT DO YOU MAKE OF THE FLOWS WE HAVE SEEN SO FAR? JOHN: THERE IS A COMMENTS LIKE T-BILL AND CHILL. YOU GET A LITTLE OVER 5% WITHOUT TAKING THE RISK. THERE IS A PUSHING POLE BETWEEN STOCKS AND BONDS IN GENERAL. YOU ASKED IN JANUARY AND I SAID IF YOU CAN GET 4% WITH NO RISK, THAT IS ATTRACTIVE. HERE WE ARE NOW AND IS IS THAT IT IS AT 5.25%. THAT HAS APPLICATIONS FOR ALL ASSET CLASSES. VERY IMPACTFUL. ALIX: I WILL ASK ABOUT CRYPTO. IF YOU LOOK AT WHAT ERIC WAS TALKING ABOUT, DO YOU PLAY THAT AHEAD OF AN ETF LAUNCH? DO YOU WANT TO GET INVOLVED IN THE ETF TO DIVERSIFIED? JON: WE WROTE A REPORT IN 2018 ABOUT BITCOIN. BITCOIN DID NOT MERELY HAVE AS MUCH INTEREST AS NOW. IT IS STILL OUR MOST WIDELY OPENED AND READ REPORT. IT SAID SOMETHING TO US. A COUPLE OF YEARS AGO WE WERE GETTING QUESTIONS ABOUT HOW TO USE IT. WE PUT TOGETHER A CRYPTO EQUITY AND CRYPTO MODEL PORTFOLIO. WE DID USE THINGS LIKE BLOCK AND SOME OF THE CHRISTIAN MINORS. -- CRYPTO MINORS. WE ALWAYS SAY SIZE INAPPROPRIATELY, HAVE IT IS A SATELLITE. DO NOT PUT ALL YOUR EGGS IN IT. BUT I WOULD NOT PLAY G BTC NOW. WHEN IT WAS -40%, IT WAS MORE INTERESTING. ERIC: SPEAKING OF TEMPTING TRADES, INTERNATIONAL TO ME HAS ATTEMPTED A LOT OF PEOPLE, HAVE THAT NICE RUN SIX MONTHS AGO. SEEMS LIKE IT HAS THESE FAKES EVERY THREE OR FOUR YEARS AND THEN YOU TAKE OVER. YOU HAVE SOME INTERNATIONAL ETF'S IN HERE BUT YOU DO HEDGE THEM. THE HEDGE VERSION IS OUTPERFORMING BY A LOT. DO YOU STILL RATE THIS? HOW DO YOU BALANCE THAT GOING TO THAT ROUNDS -- VALUE OF INTERNATIONAL VERSUS WHAT SEEMS TO WORK EVERY TIME? JON: THERE IS A SAYING THAT YOU HOME GROW AND RENT VALUE. INTERNATIONAL IS MORE OF A VALUE. YOU SHOULD ON BOTH. FROM 2000 TO 2010, THE S & P WAS DOWN 10%, NASDAQ DOWN 40%. IT DOES NOT ALWAYS GO UP, BUT IN THAT 10 YEAR PERIOD, EMERGING MARKETS WERE UP 150%. THE IDEA THAT THE ONLY GROWTH IN U.S. IS IN THOSE THINGS STOCKS IS NOT TRUE. SOME COMPANIES -- SOME BIG COMPANIES ARE OVERSEAS. THE EXCHANGE IS UP 40%. -- DXJ IS UP 40%. SOME OF OUR TACTICAL TOOLS ARE DXJ, HDJ. YOU HAVE STRONGER EARNINGS MOMENTUM, POSITIVE ESTIMATE REVISIONS. A MUCH CHEAPER THAN THE U.S., MUCH FURTHER BEHIND THE INFLATION CYCLE AND INTEREST RATE CYCLE. I THINK THEY ARE ATTRACTIVE RIGHT NOW. MATT: I WANT TO GET BACK TO T-BILL AND CHILL. DO YOU START GOING OUT LONGER DURATION. EVERYBODY HAS BEEN PULLED INTO TLT, BUT IT HAS NOT BEEN A GOOD TRADE. YOU HAVE LOST A LOT OF MONEY ON IT NOW TWO YEARS IN A ROW? DO YOU THINK ABOUT LONGER? JON: IN JANUARY, I SAID AS PTO WAS ONE OF MY TASKS. WE STILL OWN IT. A YEAR AGO, IF I WERE ON THE SHOW, OUR DURATION WAS TWO TO THREE. WE HAVE EXTENDED OUR DURATION THE LOT. IF EVERYONE BELIEVES A RECESSION WILL HAPPEN, MAYBE THE TRAY DOES NOT WORK. THE ONLY REASON WHY IT HAS NOT WORKED THIS YEAR AS THERE IS NOT MANY RECESSION BUT HISTORICALLY, TNT'S MONSTER USED DURING RECESSIONS. IT CAN ACT LIKE AN EQUITY-LIKE RETURN, GIVES YOU AN INVERSE CORRELATION BUT EVENTUALLY IT DOES WORK YOU GET INTO THAT RECESSION. ALIX: ALTERNATIVE ASSETS, DO YOU LIKE THEM? JON: I DO. BITCOIN DOES FALL IN THAT BUCKET. I WOULD RATHER OWN THINGS LIKE BTAL OR GLDM. THERE IS SOME INFLATION LINKED ASSETS IN THE ALTERNATIVE BUCKET, WHERE THERE IS A LOW CORRELATION TO STOCKS AND BONDS, MUCH CHEAPER VALUATION. BTL IS NEGATIVE 70% CORRELATION. NOW MORE THAN EVER YOU SHOULD HAVE ALTERNATIVES. BITCOIN IS UP FOR PLAY. MATT: GREAT HAVING YOU. JON DAVI OF ASTORIA ADVISORS. NEXT, WE FURTHER INTO YIELDS AND THEN GOLD THIS IS ETF IQ ON BLOOMBERG. ♪ 2 TIME FOR ECF BRIEF. THE ISSUE IS TLT IS THE 20 PLUS YEARS TREASURY BOND ETF. TO DURATION OR NOT IS AN ENORMOUS ISSUE. YOU CAN SEE THAT TENSION PLAYING OUT. ON THE BOTTOM, YOU HAVE ACTUAL INFLOWS INTO THIS ETF, ABOUT $18 BILLION SO FAR THIS YEAR. ON THE TOP, YOU HAVE THE ACTUAL PERFORMANCE ON PAPER. THAT TENSION IS PLAYING OUT. IF YOU LIKE DURATION, BUT DO YOU DO WITH THE CREDIT MARKETS? THE NEXT CHART SHOWS OAK YOU THE AND HYG. OVERALL, YOU ARE SEEING THAT NET INTEREST COMING IN AT $14 BILLION. AS THE MARKET WAITS FOR SOMETHING TO BREAK, THAT IS ONE WAY INVESTORS ARE PLAYING IT. I WANT TO END WITH GOLD. ACTUAL GOLD THIS PAST WEEK HAS BEEN A SAFE HAVEN, BUT THE GOLD ETF, NOT SO MUCH. THIS SHOWS TOTAL HOLDINGS IN GOLD, ALL THE PHYSICALLY BACKED FUNDS. WE ARE LOOKING AT 86 MILLION OUNCES. DOES THE GOLD PRICE RALLY FURTHER FROM HERE UNLESS YOU SEE INTEREST INTO THESE ETF'S? I DO NOT KNOW THAT THAT IS A GIVEN. IT IS CURIOUS. YOU ARE NOT SEEING THAT INFORMATION INTO THE ETF SPENT AT THE TREASURY MARKET, YOU ARE LIKE MOTTO. MATT: FOR ME, IT IS INTERESTING THAT THE UNDERLYING COMMODITY HAS HALTED THESE LEVELS. EVEN AS INFLATION IS COME DOWN SO DRAMATICALLY AND YOU ARE GETTING 5% YIELDS ON TWOS AND 20'S. ERIC: GOLD ETF'S ARE A SMALL AMOUNT. GOLD WOULD PROBABLY MOVE THE ETF. ALSO THE ZERO CORRELATION. IT ALWAYS DOES WHAT YOU THINK IT WILL NOT DO. THAT IS THE BEAUTY OF GOLD. IT ARCHES TO THE HEAT OF ITS OWN DRUM, NOT INVERSE OR CORRELATED. ALIX: BUT I WOULD POINT OUT THAT THEY WILL SAY THAT THAT PERCENTAGE ETF MOVES THE PRICE A LOT. ERIC: IT IS DEFINITELY A HUGE FACTOR. THAT IS WHY IT IS POSSIBLE THAT THE BITCOIN ETF IS SO EXCITING TO PEOPLE. IT WILL BE A FACTOR. ALIX: STILL AHEAD, THE BOOM IN OPTION SELLING STRATEGIES. ANDY CHECK -- AND CHECK ON EQUITY RALLIES. MATT: THIS IS ETF IQ ON BLOOMBERG. I AM MATT MILLER, ALONG WITH ALIX STEEL. ALIX: REIC -- ERIC IS HERE TO FOCUS ON ONE ETF. ERIC: QQQY IS A TAKE ON THE Q'S. NASDAQ 100, GOOD THERE. EFFECTIVELY, THIS HOLDS THE Q'S AND THEN IT ALSO RATES OPTIONS BUT NOT JUST ANY OPTION. IT IS ZERO DATED OPTIONS. IT IS THE FIRST ETF THAT USES THESE OPTIONS, BUT IT IS NOT TRADING THEM EVERY DAY IT IS RAINING OPTIONS TO GET INCOME TO GIVE YOU EXTRA YIELD. LET'S LOOK AT THE PERFORMANCE VERSUS THE Q'S. I WILL SHOW YOU THAT 6% YIELD AND HOW HANDY IT COMES IN IN A DOWNTURN THE REAL Q'S IS DOWN. USE OF THE YIELD IN NZ RETURN GETS ALMOST ANNIHILATED. BOOMERS LOVE THESE YIELD ETF'S. THEY BUFFER THE DOWNSIDE. EVEN THOUGH IT SOUNDS CRAZY, ZERO DATA OPTIONS, THIS APPEALS TO CONSERVATIVE BOOMERS. ALIX: I AM NOT A CONSERVATIVE BOOMERS, BUT MAYBE MATT IS. MATT: NOT YET. I NEVER WILL BE. I MISSED THE CUTOFF DATE, 1973. THANK YOU FOR THAT SET UP AND FOR THE INSULT. LET'S TALK ABOUT THIS WITH SYLVIA. I AM SURE THIS IS NOT AIMED SPECIFICALLY AT BOOMERS. IT IS INTERESTING THAT YOU ARE USING ZERO DAYS TO SPARE OPTIONS. HOW MUCH DOES THAT TAKE THE EDGE OFF? HOW GOOD ARE THEY AT HEDGING? SYLVIA: IS NOT PARTICULARLY THERE'S PARTICULAR TO BOOMERS BUT THEY LIKE THE INCOME. BUT EVEN ON YOUTUBE, YOU HAVE YOUNG PEOPLE WHO ARE SITES. -- WHO ARE PSYCHED. THE EVIDENCE IS BROAD. YOU ARE USING SHORT-TERM PUTS THAT EXPIRE WITHIN 24 HOURS. AT THE END OF THE DAY, WE ENTER INTO A STRATEGY TO CAPTURE THAT VOLATILITY WITHIN A 24 HOUR IN -- PERIOD. THERE IS NO HEDGE. WE ARE ESSENTIALLY HOLDING CASH INTO TREASURIES AND SELLING. MATT: LET ME DEFEND MY BOOMER STATEMENT. WE HAVE A'S PHRASE BOOMER CANDY. I WANT TO TAKE THIS. IT IS FOR CERTAIN ETF'S. BOOMERS HAVE MADE ALL HIS MONEY ON THE MARKET AND THEY WANT TO PARTICIPATE BUT THEY WANT TO TAKE THE DOWNSIDE OFF. THEY ARE WILLING TO GIVE UP UPSIDE. EVEN THE ZERO DAY OPTIONS ARE IN THE NAME AND IT SOUNDS CRAZY, YOU ARE GIVING UP YOUR UPSIDE TO GIVE A LITTLE DOWNSIDE PROTECTION BE IN THAT YOUNG. THAT IS WHY WE CALL IT BOOMER CANDY. AND YOU ARE NOT ALONE. JACKIE IS $30 MILLION. THERE ARE COPYCATS. SYLVIA: IT CANNOT BE MORE BORING IN THE BEST POSSIBLE WAY. WHAT YOU ARE SACRIFICING IS UPSIDE. YOU GET A BIT OF UPSIDE. WE ARE GOING TO LOOK FOR STRIKE PRICES SLIGHTLY ABOVE WHERE THE S & P 500 IS, BUT YOU ARE LOOKING TO GENERATE THAT INCOME. YOU WILL EITHER BE IN LINE ON THE EQUITY PERFORMANCE, PERHAPS LESS OF IT STARTS TO RALLY TO THE UPSIDE. YOU WILL DO BETTER IN A DOWNTURN. WE ARE DOWN 1.4 BECAUSE WE CAPTURED THAT PREMIUM. IN A MARKET'S RANGE BOUND, 1% UP OR DOWN, YOU ARE GETTING 100% OF THAT PREMIUM ON A DAILY BASIS, WHICH COULD BE ANYWHERE FROM ZERO TO 1%. WHY THIS MORE ELEGANT THAN OTHER STRATEGIES IS BECAUSE YOU GET 25 OR SO BYTES OF THE APPLE EACH MONTH. SO YOU NOT STUCK WITH THE STRATEGY WERE MIDMONTH YOU ARE STUCK. EACH DAY WE RESET. ALIX: IF YOU GET A PROPER SELLOFF, DOES THE STRATEGY STILL MAKE SENSE? SYLVIA: IT SHOULD BE IN THEORY DEPENDING ON THE PREMIUM YOU HAVE ACHIEVED OUR. CERTAINLY THE RISK OF THE FUND IS SIMILAR TO THE RISK OF HAVING THE EQUITY EXPOSURE. THE INCOME IS YOUR UPSIDE. THIS IS GREAT FOR BOOMERS BECAUSE YOU ARE IN THE MARKET, TOUCHING EQUITIES, DABBLING WITH THEM BUT YOU DO NOT HAVE ANY MORE RISK. THE BENEFIT OF GENERATING PREMIUM ON A DAILY BASIS. THE FIRST DISTRIBUTION WAS ANNUALIZED AT 67.5% ON JEPY. I'M SELLING AT THE MONEY PUTS ON A DAILY BASIS. MATT: THANKS FOR JOINING US, SYLVIA, OF DEFIANCE ETF, TALKING UP QQY OVER JEPY. YOU CAN LISTEN TO ERIC ENDED JOEL WEBER ON TRILLIONS, THEIR BIWEEKLY PODCAST. ALIX: BIWEEKLY PAY WEEK. MATT: THAT DOES IT FOR US.

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