Why Banks Are Airlifting Gold & Companies Are Betting on Bitcoin

TL;DR

1. U.S. Housing Starts Fall 9.8%

2. X Seeks Funding at $44B Despite Financial Struggles

3. Bitcoin Copycats: 78 Companies Follow Saylor’s Lead

4. Gold Rush Takes Off: Banks Airlift Bullion to the U.S.

Why Did Housing Starts Fall in January?

New residential construction in the U.S. decreased 9.8% in January to an annualized pace of 1.37 million starts, below economists’ expectations of 1.39 million. The new-home market is expected to see only modest growth this year, due to mortgage rates near 7% and median prices that are 29% higher than in December 2019.  

• Freezing temperatures contributed to the slowdown — except in the West, where homebuilding jumped 25% despite California wildfires.

• Tariffs could further pressure the housing market this year, as builders in the U.S. rely on imports for nearly one-third of appliances and lumber. 

• Mass deportations are another risk. Up to 28% of construction workers are immigrants, many undocumented.

Housing affordability falls hardest on younger generations, a key theme in Scott’s TED talk.

It's really easy to buy into worst-case scenarios. Train yourself to think about what could go right. American-style capitalism will find a way, regardless of what roadblocks get thrown up by trade wars. 

There’s room for a catch-up trade here: Confidence is low among homebuilders, and housing stocks are behind where the overall market is. But if mortgage rates fall a bit more in the second half of the year, and we get a bounce back after the weather, then all of a sudden, confidence returns. This pattern happens all the time, Trump or no Trump.

X Eyes New Funding at a $44B Valuation — Despite a Rocky Financial Track Record

Elon Musk’s X is in talks to raise money at the same $44 billion valuation he paid in 2022, despite falling ad revenue, declining market share, and an uncertain business model.

X today is vastly different from the Twitter Musk bought three years ago. He cut 80% of its workforce, overhauled content moderation, and pivoted the platform’s business model toward subscriptions. The company also holds a $6 billion stake in xAI, Musk’s AI startup now seeking funding at a $75 billion valuation.

Yet financial struggles persist. In Musk’s first full year in charge, ad revenue plunged 46%.

Cost cutting has helped X’s profitability. Its adjusted EBITDA margin was 46% last year — up from 14% before Musk’s takeover. For context, Meta’s EBITDA margin is 51%. 

Why now?

• Debt burden from the buyout: X was left with $13 billion in debt post acquisition, requiring annual interest payments of at least $1 billion — a major strain given declining revenue.

• AI and infrastructure expansion: Musk is aggressively investing in AI capabilities, including building proprietary data centers.

Musk’s valuation magic trick isn’t new. X is worth $44 billion because Musk says it is. Investors aren’t buying a booming ad business — they’re buying proximity to Musk and whatever future he’s selling.

Chasing Saylor: Companies Are Betting Big on Bitcoin

At least 78 public firms — including a meal-delivery service and a coal-mining company — have pivoted to bitcoin, copying a bet first pioneered by Strategy CEO Michael Saylor. As of February 2025, Strategy owns 2.3% of all 21 million bitcoins, at an average cost of $65,033 per coin — nearly 50% below current prices. 

• So far, Saylor’s bet has paid off: Strategy’s stock is up over 2,000% in five years, outpacing every member of the Magnificent Seven.

• Copycats have also gotten a boost: Semler Scientific, a chronic disease detection company, and Metaplanet, a former hotel operator in Japan, are up 80% and over 3,000%, respectively, since starting to buy bitcoin last year. 

Similar to Strategy, many of the copycats are taking on debt to fund bitcoin purchases. But they lack Strategy’s key advantages: 

• Lower average cost: Strategy started buying bitcoin in 2020, giving it time to accumulate a massive position at a lower average price. Copycats are buying at much higher levels, giving them less margin for error if bitcoin’s price falls.

• Ultra low borrowing costs: Strategy’s more than $7 billion in debt carries an implied interest rate below 0.5%, with some bonds at 0%. Semler, by contrast, is paying 4.25% — a much heavier burden.

If bitcoin stagnates or drops, these firms still have to service expensive debt. The risk? A repeat of past boom-and-bust cycles, where latecomers chase the hype — only to get wiped out when the tide turns.

On this podcast, Saylor admitted that before bitcoin, Strategy was struggling. The common thread among its copycats? They’re all in the same boat. This strategy is starting to look like a “Get Out of Jail Free” card for underperforming businesses. 

Worse, the playbook has the makings of a Ponzi scheme — securitizing bitcoin to issue bonds, then using the proceeds to buy more bitcoin. Adding Strategy to the Nasdaq 100 only amplifies the risk, dragging millions of investors and pension funds into this high-stakes experiment.

In the short term, this strengthens Strategy by driving more bitcoin demand, increasing its scarcity, and benefiting companies with large holdings.

Over the medium to long term, if this trend continues, Strategy's premium over its bitcoin holdings will diminish. Right now, it trades above its net asset value (NAV) because investors value both its bitcoin holdings and its accumulation strategy. But if enough competitors emerge, that scarcity premium will fade.

Gold Hits Record High Amid Inflation and Trade Tensions

Gold prices have surged to an all-time high as investors flock to the metal as a hedge against trade tensions and persistent inflation concerns.

Gold futures in New York now trade at a premium to London spot prices, driven by expectations of sustained investor demand and rising costs of acquiring physical gold in the U.S.

In response, major banks are airlifting gold into the U.S. to capitalize on the price discrepancy and hedge against potential trade disruptions. While gold itself hasn’t been explicitly targeted, the Trump administration’s 25% tariff on steel and aluminum has fueled uncertainty, prompting buyers to secure supplies preemptively. JPMorgan and HSBC, which hold significant reserves in London, are moving gold to New York, where it trades at a premium, both to profit from the arbitrage and to fulfill futures contracts at lower costs.

Gold has historically served as a hedge against economic uncertainty. In 6 of the past 8 major stock market crashes over the past 40 years, gold prices climbed, reinforcing its reputation as a defensive investment.

Listen to Josh’s take on the value of gold in periods of geopolitical uncertainty. (Hint: in a worst case scenario … what the f*ck are you gonna do with your gold ETF?)

Spot Price vs. Futures Price?

The spot price is the current market price of a commodity, like gold, for immediate delivery and payment. It reflects real-time supply and demand.

The futures price is the agreed-upon price for a commodity to be delivered at a later date, factoring in expectations about market conditions, inflation, interest rates, and storage costs.

Nvidia will hit a new all-time high after reporting earnings. The conversation is shifting from large language models to physical AI, automation, and robotics — areas where Nvidia has the strongest case for industry leadership.

How does a monk become a media mogul? Scott chats with Jay Shetty, chief purpose officer of Calm, about his professional journey, the business of podcasting, and the keys to building successful relationships. Listen here.