2025-03-25 21:27:10
To investors,
Home affordability is the worst it has been in decades. The problem is so bad that I decided to do something about it just over a year ago — I cofounded ResiClub, the leading residential real estate analytics and content platform, with Lance Lambert, who I believe is the best residential real estate reporter in the country.
Our thesis is simple — you can’t solve a problem if you don’t understand it well. Below is a guest post from Lance where he explains just how bad home affordability has become in the United States. You can subscribe to ResiClub and receive a free daily email about the housing market here: Subscribe to ResiClub
Strained housing affordability isn’t just squeezing household budgets—it’s holding back the entire U.S. economy. Some of the nation’s most talented workers are unable to move to the top job markets where they could contribute the most. That loss of mobility means less innovation, fewer startups, and slower economic growth.
At the same time, high housing costs are forcing many Americans to delay starting families—or have fewer children than they otherwise would—reshaping the country’s demographic future. And with more household income tied up in housing payments, consumer spending in other areas suffers, further dampening economic momentum. America’s housing affordability pinch isn’t just a personal problem—it’s a national one.
Here’s the annual U.S. household income needed to purchase a typically valued $356,776 U.S. home:
Jan. 2020 -> $51,646
Jan. 2021 -> $51,740
Jan. 2022 -> $62,669
Jan. 2023 -> $86,184
Jan. 2024 -> $92,006
Jan. 2025 -> $92,538
That’s a +79% shift in just 5 years.
And here’s the thing: This is a very conservative methodology. Zillow calculation assumes a 20% down payment and the homebuyer spends less than 30.0% of their monthly income on the total monthly payment. This is a financed purchase, of course. For typical home value, Zillow economists used the latest Zillow Home Value Index reading.
Click here to view a searchable version of the chart below displaying the analysis in 400 metro area housing markets [best done on a desktop]
How did we get here?
During the Pandemic Housing Boom, housing demand surged rapidly amid ultralow interest rates, stimulus, and the remote work boom. Federal Reserve researchers estimate “new construction would have had to increase by roughly 300% to absorb the pandemic-era surge in demand.” Unlike housing demand, housing supply isn’t as elastic and can't quickly ramp up like that. As a result, the heightened pandemic-era demand drained the market of active inventory and sent national home prices soaring. The typical U.S. home value measured by the Zillow Home Value Index in January 2025 ($356,776) is still a staggering +44% greater than in January 2019 ($247,106).
That overheated home price growth, coupled with the ensuing mortgage rate shock, with the average 30-year fixed mortgage rate jumping up from under 3.0% to over 7.0%, has created the fastest ever deterioration in housing affordability.
This affordability squeeze has been broad-based.
Click here to view an interactive version of the January 2020 map below.
Click here to view an interactive version of the January 2025 map below.
The problem, of course, is that incomes haven’t kept up.
While the annual U.S. household income needed to purchase a typical U.S. home has increased by +79% between January 2020 and January 2025, average weekly earnings of U.S. workers have risen by +25%, and overall U.S. consumer inflation has grown by +23% during the same period.
The biggest immediate impact of this affordability deterioration is that across the country existing home sales have been constrained since mortgage rates spiked in 2022. Some of that’s the result of suppressed housing demand, but a lot of it is due to the fact that many homeowners who’d like to sell their home and buy something else simply can’t afford to do so or don’t want to part with their lower monthly payment/mortgage rate.
I hope you enjoyed this guest post from Lance Lambert, cofounder and Editor-in-Chief of ResiClub, your gateway to the US housing market. You can subscribe to ResiClub below to receive a free daily email about the residential housing market.
- Anthony Pompliano
Founder & CEO, Professional Capital Management
Simon Greovich is the President & CEO of Metaplanet. This conversation was recorded at Bitcoin Investor Week in New York.
In this conversation we discuss Metaplanet buying bitcoin and becoming the best stock of the year, the best tools are for acquiring bitcoin, economic conditions in Japan, getting exposure to global markets, growth expectations, educating Wall Street, and how people can help.
Enjoy!
Simple Mining offers a premium white-glove Bitcoin mining service. Want to grow your Bitcoin stack? Visit here to learn more.
Reed Smith - Smart legal solutions for complex disputes, transactions, and regulations. Learn more at www.reedsmith.com.
Franzy - Ready to leave the 9-to-5, start a side hustle, or expand your portfolio? Franzy is your gateway to franchise ownership—research, compare, and fund the right opportunity with confidence and transparency.
Bitwise - America’s largest crypto index fund manager and the only Bitcoin ETF issuer that publishes its wallet address plus donates 10% of profits to open source developers. Learn more at BitwisePomp.com
BitcoinIRA - Buy, sell, and swap 75+ cryptocurrencies in your retirement account. Pay less taxes. Earn up to $1,000 in rewards.
Bitdeer - A global technology company focused on Bitcoin mining, ASIC development and HPC for AI, backed by advanced R&D and a massive 2.5 GW global power portfolio.
BitcoinOS - The operating system for bitcoin applications powered by zero-knowledge technology. Check out @BTC_OS on twitter to learn more.
Gemini - The future is being built today. Go Where Dollar’s Won’t. With Gemini.
Xapo - Xapo Bank is the only way to bank with Bitcoin.
Polkadot - a scalable, secure, and decentralized blockchain technology aimed at creating Web3. Innovation leader, making it a preferred choice for big names.
You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren't finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.
2025-03-24 21:34:29
To investors,
Ray Dalio said the famous phrase “cash is trash” on national television in 2020. He was warning market participants that inflation was coming and anyone sitting in US dollars would be destroyed by the currency debasement. Take a listen:
Ray Dalio was right in hindsight. The Federal Reserve kept interest rates artificially suppressed at 0% for too long, while the government continued to print trillions of dollars in an effort to stimulate the economy. Inflation spiked to over 9% and the cumulative inflation since January 2020 has now topped 26%, meaning that $1 from 2020 can only buy $0.74 of goods today.
This is the hidden tax that has destroyed the financial lives of many American families. According to Perplexity, approximately “40% of Americans have no investable assets, meaning they do not own stocks, bonds, mutual funds, or other financial instruments outside of cash or retirement accounts.”
This 40% of Americans are the ones who got hurt the most when the dollar devalued by more than 25% over the last few years. They were sitting in cash and took the inflation on the chin. Brutal.
This brings us to the other side of the story — Mike Zaccardi highlights that investor allocations to public equities is at an all-time high.
So in a weird way, investors—both individuals and institutions—were listening to Ray Dalio and the other famed asset managers who were issuing warnings back in 2020. Capital has relentlessly poured into the public equity market and now more than 50% of aggregate financial assets are allocated to the stock market.
This is good for the people holding stocks because they benefitted from the out of control inflation over the last half decade. But while asset owners were winning, those sitting in cash have been falling further behind — this is why the income inequality gap continues to widen.
Rich get richer, poor get poorer.
Things may be changing quickly though for these stock investors. Owen Tucker-Smith wrote an article in the Wall Street Journal over the weekend titled “Investors Who Were All In on U.S. Stocks Are Starting to Look Elsewhere.” He points out that non-US markets have been outperforming the S&P 500 year-to-date.
Investors are going to chase performance. Momentum is a hell of a drug. And Tucker-Smith shows the recent inflows to US-based ETFs that invest in European public equities — investors are shoveling capital into these funds like their financial lives depend on it.
So one of the big questions right now is whether investors should be allocated to US stocks or international equities. Depending on who you talk with, you will get a very different answer.
Which brings me to the current conversation about stock valuations, tariffs, and the economic policies of the new administration. Could the stock market be overvalued right now? Maybe. Could a recession come? Maybe. Could the stock market recover and take-off to new highs like it did in 2020? Maybe.
No one knows the future.
It is all noise in my opinion. There will always be short-term gyrations in the market, but stocks are structured in a way where they have to keep going up over the long run. Don’t get distracted by the fear-mongering or the doomsday predictors.
A broken clock is right twice a day.
The dollar will lose purchasing power over decades. Assets like stocks, bitcoin, and real estate will keep pushing to new all-time high after all-time high. I like the K.I.S.S. method — keep it simple, stupid.
Wall Street and finance like to make things confusing and complex. Don’t be one of the victims to complexity. Your portfolio will thank you in the future.
- Anthony Pompliano
Founder & CEO, Professional Capital Management
Jordi Visser is a macro investor with over 30 years of Wall Street experience. He also writes a Substack called “VisserLabs” and puts out investing YouTube videos.
In this conversation we discuss the Fed’s interest rate decision, stock market outlook, Tesla, AI, Nvidia, and how investors are approaching April 2.
Enjoy!
Simple Mining offers a premium white-glove Bitcoin mining service. Want to grow your Bitcoin stack? Visit here to learn more.
Reed Smith - Smart legal solutions for complex disputes, transactions, and regulations. Learn more at www.reedsmith.com.
Franzy - Ready to leave the 9-to-5, start a side hustle, or expand your portfolio? Franzy is your gateway to franchise ownership—research, compare, and fund the right opportunity with confidence and transparency.
Bitwise - America’s largest crypto index fund manager and the only Bitcoin ETF issuer that publishes its wallet address plus donates 10% of profits to open source developers. Learn more at BitwisePomp.com
BitcoinIRA - Buy, sell, and swap 75+ cryptocurrencies in your retirement account. Pay less taxes. Earn up to $1,000 in rewards.
Bitdeer - A global technology company focused on Bitcoin mining, ASIC development and HPC for AI, backed by advanced R&D and a massive 2.5 GW global power portfolio.
BitcoinOS - The operating system for bitcoin applications powered by zero-knowledge technology. Check out @BTC_OS on twitter to learn more.
Gemini - The future is being built today. Go Where Dollar’s Won’t. With Gemini.
Xapo - Xapo Bank is the only way to bank with Bitcoin.
Polkadot - a scalable, secure, and decentralized blockchain technology aimed at creating Web3. Innovation leader, making it a preferred choice for big names.
You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren't finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.
2025-03-20 22:36:09
To investors,
The Federal Reserve decided not to cut interest rates yesterday. I believe this is a mistake on their part and is another data point proving the Fed is continuously behind the curve when it comes to monetary policy in the modern age.
If you remember, the central bank didn’t raise interest rates until inflation was already out of control during the pandemic. We eventually saw inflation officially hit 9% according to the government data. Inflation was not transitory as they predicted and the American consumer suffered dearly.
A big reason for the Fed’s persistent lag is they have a data problem. Not only is the data backwards looking and lacks real-time accuracy, but the economic data is no longer trustworthy. The Bureau of Labor Statistics was forced earlier this year to revise down the number of jobs created in the last year by nearly 600,000 jobs.
It is insane how inaccurate the jobs number has become.
But that is not the only issue with economic data. I have been convinced that you can not trust most of the reported data. Do you believe the official inflation metrics? I don’t. A good question to ask yourself is whether you think more than 50% of the data is accurate or inaccurate? I am in the camp of majority of the data being inaccurate when it is reported.
You may not care what I think, so what if I told you that new Treasury Secretary Scott Bessent agrees with me. Here is Scott explaining the problem with current economic data on the All-In podcast:
I don’t think it gets much clearer than the Treasury Secretary being asked point blank whether he trusts the data and he says “no.” So this is not some big conspiracy theory, but rather a rational understanding of how the data is collected, analyzed, and reported.
The problem with inaccurate economic data is that it makes the job harder for policymakers and investors alike. How do you decide what to do if you can’t trust the data? And how do investors allocate capital in the market if they can’t trust the data?
This has been a major problem for awhile. It is good to see the current administration acknowledging the problem. That is the first step to fixing it.
This brings us back the Federal Reserve’s decision yesterday to hold rates at the current level. That would be prudent if you were looking at the last CPI report of 2.8% year-over-year inflation growth. The issue is you can’t trust that number and real-time alternative inflation measurements like Truflation are telling you the government data is off substantially.
Truflation is reporting CPI at 1.7% right now, which is below the Fed’s target rate of 2%.
If Truflation is right, which I tend to think is the case, then the Federal Reserve should be cutting interest rates right now because inflation is not a concern. We need to refinance trillions of dollars in federal debt this year, homes for the average American family have become unaffordable, and businesses desperately want to access cheaper capital — all of this is positively affected by lower interest rates.
Rates are too high. The Fed should cut. But they are hiding behind the government inflation data as reason to stay at current interest rate levels. When inflation data shows up lower in the next few months, we will all once again have proof that the Fed is behind the curve.
A story as old as time.
Hope you all have a great day. I’ll talk to everyone tomorrow.
- Anthony Pompliano
Founder & CEO, Professional Capital Management
Cynthia Lummis is a U.S. Senator from Wyoming, and is the first-ever chair of the new Senate panel devoted to digital assets.
In this conversation we discuss stablecoin regulation, what the bitcoin strategic reserve could look like, what the US should do to embrace crypto, how bitcoiners are working with politicians, and what the bitcoin community can do to help.
Enjoy!
Simple Mining offers a premium white-glove Bitcoin mining service. Want to grow your Bitcoin stack? Visit here to learn more.
Reed Smith - Smart legal solutions for complex disputes, transactions, and regulations. Learn more at www.reedsmith.com.
Franzy - Ready to leave the 9-to-5, start a side hustle, or expand your portfolio? Franzy is your gateway to franchise ownership—research, compare, and fund the right opportunity with confidence and transparency.
Bitwise - America’s largest crypto index fund manager and the only Bitcoin ETF issuer that publishes its wallet address plus donates 10% of profits to open source developers. Learn more at BitwisePomp.com
BitcoinIRA - Buy, sell, and swap 75+ cryptocurrencies in your retirement account. Pay less taxes. Earn up to $1,000 in rewards.
Bitdeer - A global technology company focused on Bitcoin mining, ASIC development and HPC for AI, backed by advanced R&D and a massive 2.5 GW global power portfolio.
BitcoinOS - The operating system for bitcoin applications powered by zero-knowledge technology. Check out @BTC_OS on twitter to learn more.
Gemini - The future is being built today. Go Where Dollar’s Won’t. With Gemini.
Xapo - Xapo Bank is the only way to bank with Bitcoin.
Polkadot - a scalable, secure, and decentralized blockchain technology aimed at creating Web3. Innovation leader, making it a preferred choice for big names.
You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren't finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.
2025-03-19 21:21:55
To investors,
The US government established the Strategic Bitcoin Reserve recently and many in the crypto community were upset because no new purchases of bitcoin were announced.
If America finds it valuable to hold the bitcoin we already have in our possession, we should also find it valuable to buy more. Anything worth doing is worth overdoing.
Thankfully, the President’s Executive Order was well written and included an important sentence granting the Treasury and Commerce the opportunity to acquire more bitcoin in a budget neutral way. The sentence specifically reads “the Secretaries of Treasury and Commerce are authorized to develop budget-neutral strategies for acquiring additional bitcoin, provided that those strategies impose no incremental costs on American taxpayers.”
Most people realize this is significant yet they don’t understand what the government is going to do next.
Well, we just got our answer yesterday. Bo Hines, the Executive Director of Digital Assets, said the US government wanted “as much as we can get” in reference to how much bitcoin would acquired over time.
That is a big statement coming from someone focused on acquiring more bitcoin for the United States. This brings us to the most important question — how can the US acquire more bitcoin in a budget neutral way?
VanEck’s Matthew Sigel shared 6 ideas on how this could happen. Coinpedia did a good job summarizing the ideas here:
The U.S. holds vast gold reserves, but they are valued at a much lower official price than their current market worth. VanEck suggests that Congress could update this valuation, instantly increasing the paper value of these reserves. The extra capital generated could then be used to buy Bitcoin—without printing new money or raising taxes.
Another option is for the government to create and sell “Bitcoin-backed bonds.” Investors would buy these bonds, and a portion of the money raised would go toward purchasing BTC. When the bonds mature, the government could repay investors either in Bitcoin or U.S. dollars, offering a flexible investment opportunity.
Before 2015, the Federal Reserve was allowed to keep a larger surplus of funds. VanEck suggests bringing back this policy so that the Fed can build up extra reserves and use them to buy Bitcoin. This would provide a direct way for the government to acquire BTC without needing new congressional spending approvals.
Special Drawing Rights (SDRs) are international reserve assets issued by the International Monetary Fund (IMF). VanEck proposes convincing the IMF to include Bitcoin in SDRs, making it a recognized global reserve asset. If approved, this would further cement Bitcoin’s role in international finance.
5. Selling Surplus Cheese for Bitcoin
The U.S. government holds large stockpiles of surplus cheese. VanEck suggests selling off these reserves and using the proceeds to buy Bitcoin. Since this involves selling existing assets rather than increasing spending, it wouldn’t impact the federal budget deficit. At the same time, it would help the government manage its excess inventory more efficiently.
The Exchange Stabilization Fund (ESF), controlled by the U.S. Treasury, is used to manage foreign exchange reserves and stabilize the dollar. VanEck’s final proposal is for the Treasury to use this fund to buy and hold Bitcoin. Since the ESF operates outside the normal budget process, this method would offer a more flexible approach to BTC accumulation.
No one knows exactly how the government is going to acquire more bitcoin, but it is obvious that multiple government agencies are working to get more bitcoin into the Strategic Bitcoin Reserve.
I liked Bitwise’s Hunter Horsley’s comment about Bo Hines interview yesterday: “When Bitcoin is at $200k — We will look back on March 2025 and say, how was everyone not buying. It was so obvious.”
I could not agree more. The United States of America, the greatest economy ever constructed, is openly telling you they want to acquire as much bitcoin as possible. It is incredibly obvious what happens when a nation state pours billions of dollars into a finite supply asset. Just hope you weren’t late to the party.
Hope you all have a great day. I’ll talk to you tomorrow.
- Anthony Pompliano
Founder & CEO, Professional Capital Management
Jan van Eck is the CEO at VanEck. This conversation was recorded at Bitcoin Investor Week in New York.
In this conversation we talk about the relationship between bitcoin and gold, how bitcoin will disrupt Wall Street, the impact Trump will have on financial markets, and what crypto milestones Jan is looking forward to in 2025.
Enjoy!
Simple Mining offers a premium white-glove Bitcoin mining service. Want to grow your Bitcoin stack? Visit here to learn more.
Reed Smith - Smart legal solutions for complex disputes, transactions, and regulations. Learn more at www.reedsmith.com.
Franzy - Ready to leave the 9-to-5, start a side hustle, or expand your portfolio? Franzy is your gateway to franchise ownership—research, compare, and fund the right opportunity with confidence and transparency.
Bitwise - America’s largest crypto index fund manager and the only Bitcoin ETF issuer that publishes its wallet address plus donates 10% of profits to open source developers. Learn more at BitwisePomp.com
BitcoinIRA - Buy, sell, and swap 75+ cryptocurrencies in your retirement account. Pay less taxes. Earn up to $1,000 in rewards.
Bitdeer - A global technology company focused on Bitcoin mining, ASIC development and HPC for AI, backed by advanced R&D and a massive 2.5 GW global power portfolio.
BitcoinOS - The operating system for bitcoin applications powered by zero-knowledge technology. Check out @BTC_OS on twitter to learn more.
Gemini - The future is being built today. Go Where Dollar’s Won’t. With Gemini.
Xapo - Xapo Bank is the only way to bank with Bitcoin.
Polkadot - a scalable, secure, and decentralized blockchain technology aimed at creating Web3. Innovation leader, making it a preferred choice for big names.
You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren't finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.
2025-03-17 21:18:10
To investors,
Perception is reality. At least that is how markets work in the short-term. Benjamin Graham said it best when he said “In the short run, the market is a voting machine but in the long run, it is a weighing machine.”
We can see this playing out in real time.
New polls over the weekend suggest that perception from the population is significantly different than mainstream media coverage would suggest.
I don’t care what your political party affiliation is. Capital allocators have to do their best to seek truth, regardless of where it takes you. It is hard to do. It can be uncomfortable, especially when truth runs counter to your political preferences. It is a necessary process and skill though if you want to make money.
Opinions about political parties is only one part of the current story. We are also seeing perception becoming reality in the economy.
Mike Zaccardi points out a recent Apollo report claiming consumer inflation expectations have risen at an unprecedented rate. Americans believe inflation is going to come back. This is the case even though inflation is likely crashing under 2% right now.
At some point, if business owners and consumers begin acting like inflation is coming, then odds of inflation rising increase because these individuals start hiking prices and allocating their capital in anticipation of the incoming inflation.
Perception drives action. Action drives outcomes. This is how perception becomes reality.
One area where you can explicitly see perception being acted on is high net worth individuals buying the stock market dip. Adam Kobeissi writes in The Kobeissi Letter:
Wealthy individuals are rushing into US stocks. Affluent and high-net-worth investors’ inflows to US equities hit 2% as a share of BofA’s assets under management (AUM) last week, the third-highest on record. This follows the fourth-largest outflow seen in the prior week, at ~1% of AUM. Such a surge in purchases has not been seen for 2.5 years when the group's inflows hit 6% of AUM in September 2022, near the bottom of the bear market. Recent inflows were also just shy of those posted in January 2021. High-net-worth individuals are adding stocks to their portfolios as the S&P 500 has recorded its fastest 3-week decline since 2020. Wealthy investors are deploying cash.
If you think inflation is coming back, then what do you do? You get out of cash and you start buying investment assets as fast as you possibly can. Apollo is telling us inflation expectations are surging. Stocks are simultaneously falling, which created the perfect entry point for wealthy investors to deploy their cash and position themselves for future potential inflation.
Here is the interesting part though — I don’t believe inflation is going to come roaring back. In fact, I think the opposite is happening. We are seeing a disinflationary period that suggests the Federal Reserve should be cutting interest rates, rather than holding them steady.
Truflation is reporting the real time inflation number at 1.68% as of yesterday.
That is a slight increase from 1.35% inflation that was reported last week by Truflation, but it is still substantially lower than the latest government inflation reading of 2.8%.
While professional investors are debating inflation metrics and whether to buy stocks or not, the administration is fully focused on improving the economic situation for the working class. Treasury Secretary Scott Bessent posted publicly yesterday the following:
“Our Administration and the American people are focused on the real economy, not fake news polling or “vibecessions.” After four disastrous years for families and workers, President Trump has the track record and vision to deliver the most vibrant economy and capital markets in world history.”
A few data points that suggest this is working include gas prices hitting a 4-year low and egg prices dropping more than 25% in recent weeks. These welcomed developments for millions of Americans don’t tell the whole story, but they definitely signal financial relief is on the way for a large portion of the population.
A key challenge for investors in this environment is to stay on top of the day-to-day or week-to-week changes. Tariffs are on, then they are off. Inflation was high, now it is low. Things can change at a rapid pace. There is value in understanding what is happening in the world, but the secret is to not allow these changes to affect your portfolio or decision-making.
Buy great assets. Hold them for a very long time. The short term gyrations are noise. Those who can ignore the chaos and uncertainty while holding resilient assets will do just fine.
Hope you all have a great start to your week. I’ll talk to everyone tomorrow.
- Anthony Pompliano
Founder & CEO, Professional Capital Management
Jordi Visser is a macro investor with over 30 years of Wall Street experience. He also writes a Substack called “VisserLabs” and puts out investing YouTube videos.
In this conversation we discuss Trump’s economic plan, tariffs, tax proposals, Trump vs Powell, inflation, gold, stocks, and the relationships and uncertainty from the Trump admin.
Enjoy!
Simple Mining offers a premium white-glove Bitcoin mining service. Want to grow your Bitcoin stack? Visit here to learn more.
Reed Smith - Smart legal solutions for complex disputes, transactions, and regulations. Learn more at www.reedsmith.com.
Franzy - Ready to leave the 9-to-5, start a side hustle, or expand your portfolio? Franzy is your gateway to franchise ownership—research, compare, and fund the right opportunity with confidence and transparency.
Bitwise - America’s largest crypto index fund manager and the only Bitcoin ETF issuer that publishes its wallet address plus donates 10% of profits to open source developers. Learn more at BitwisePomp.com
BitcoinIRA - Buy, sell, and swap 75+ cryptocurrencies in your retirement account. Pay less taxes. Earn up to $1,000 in rewards.
Bitdeer - A global technology company focused on Bitcoin mining, ASIC development and HPC for AI, backed by advanced R&D and a massive 2.5 GW global power portfolio.
BitcoinOS - The operating system for bitcoin applications powered by zero-knowledge technology. Check out @BTC_OS on twitter to learn more.
Gemini - The future is being built today. Go Where Dollar’s Won’t. With Gemini.
Xapo - Xapo Bank is the only way to bank with Bitcoin.
Polkadot - a scalable, secure, and decentralized blockchain technology aimed at creating Web3. Innovation leader, making it a preferred choice for big names.
You are receiving The Pomp Letter because you either signed up or you attended one of the events that I spoke at. Feel free to unsubscribe if you aren't finding this valuable. Nothing in this email is intended to serve as financial advice. Do your own research.
2025-03-13 21:23:31
To investors,
Government spending is out of control. We already knew that, but now we have data that suggests the problem is getting worse and at an alarming pace.
Our friends at Geiger Capital were rightfully outraged at the February spending deficit:
“In the month of February, the US Government collected $297 Billion. Just one problem… They spent $605 Billion.
A $308 BILLION deficit. In one month.”
But the problem is not confined to only February. The first five months of the fiscal year have been disastrous at best. Geiger Capital says:
“The train is out of control… The first five months of FY 2025 produced a deficit of $1.15 TRILLION. That’s $319 Billion more than the deficit recorded in the same period last fiscal year.
We’re running a $2.75 TRILLION annual deficit.”
As if it wasn’t bad enough to see a widening deficit, Heritage’s EJ Antoni explains that “51 cents out of every dollar the federal government spent in February was borrowed!”
It is impossible to state how serious of a problem the national debt has become.
Not only has every recent President overseen an explosion in the annual deficit, but we have financed our out-of-control spending with debt because politicians are incentivized to spend everyone else’s money.
Spending more money than you take in as income can only end in one way — disaster!
But government spending is part of a much larger story. We are a country that became dependent on the government. The United States was built on the idea of a small government and a powerful private sector, but we lost our way in recent years.
Mike Zaccardi points out a recent Bank of America investment note that puts it perfectly:
“In 2024, the US had never been more government-dependent: for 85% of job growth, 33% of all spending, 6-7% budget deficits; all record highs ex-crisis.”
One area where you can see the increased dependency on the government is what percentage of someone’s personal income comes from the government. The bipartisan Economic Innovation Group point out a report last year stating:
“Income from government transfers is the fastest-growing major component of Americans' personal income. Nationally, Americans received $3.8 trillion in government transfers in 2022, accounting for 18 percent of all personal income in the United States. That share has more than doubled since 1970.”
The most insane part of the report is what happened in the approximately 50 years from 1970 to 2022. We went from less than 1% of counties in the US receiving 25% or more of their personal income from government transfers to now more than 53% of all counties receive a quarter or more of their personal income from government transfers.
1% to 53% in 50 years. Absolutely insane.
But there is even more nonsense to be found. Our friends at Unusual Whales have been hard at work uncovering the absurdities in the US economy for years. Did you know that 25% of jobs added to the US economy in the last two years were government jobs? Now you know.
According to Apollo, that number is up from 5% in 2021 and 7% in 2022.
The United States has become dependent on the government. The government is responsible for blowing out the US debt because we have zero discipline when it comes to spending.
We don’t have a revenue problem, we have a spending problem. Both political parties are responsible for this mess. And nothing is going to change unless the Department of Government Efficiency is successful and politicians realize there are consequences for a lack of fiscal discipline.
But I wouldn’t hold my breath.
Out-of-control government spending makes a lot more sense once you understand that most government spending is a legal way to convince people to vote for a certain politician. Show me the incentive and I'll show you the outcome.
Hope you all have a great day. I’ll talk to everyone tomorrow.
- Anthony Pompliano
Founder & CEO, Professional Capital Management
Eric Semler is the Chairman of Semler Scientific, Founder of TCS Capital Management, and serves on the board of Fundstrat Global Advisors. This conversation was recorded at Bitcoin Investor Week in New York.
In this conversation we talk about why Semler Scientific put bitcoin on the balance sheet, feedback from customers and shareholders, challenges, thinking through leverage percentage, potential market reaction if companies start to sell bitcoin, and more.
Enjoy!
Simple Mining offers a premium white-glove Bitcoin mining service. Want to grow your Bitcoin stack? Visit here to learn more.
Reed Smith - Smart legal solutions for complex disputes, transactions, and regulations. Learn more at www.reedsmith.com.
Franzy - Ready to leave the 9-to-5, start a side hustle, or expand your portfolio? Franzy is your gateway to franchise ownership—research, compare, and fund the right opportunity with confidence and transparency.
Bitwise - America’s largest crypto index fund manager and the only Bitcoin ETF issuer that publishes its wallet address plus donates 10% of profits to open source developers. Learn more at BitwisePomp.com
BitcoinIRA - Buy, sell, and swap 75+ cryptocurrencies in your retirement account. Pay less taxes. Earn up to $1,000 in rewards.
Bitdeer - A global technology company focused on Bitcoin mining, ASIC development and HPC for AI, backed by advanced R&D and a massive 2.5 GW global power portfolio.
BitcoinOS - The operating system for bitcoin applications powered by zero-knowledge technology. Check out @BTC_OS on twitter to learn more.
Gemini - The future is being built today. Go Where Dollar’s Won’t. With Gemini.
Xapo - Xapo Bank is the only way to bank with Bitcoin.
Polkadot - a scalable, secure, and decentralized blockchain technology aimed at creating Web3. Innovation leader, making it a preferred choice for big names.
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