What’s on the Menu 🍴

Is euphoria taking over?

Today we’re diving into some wild stock and crypto moves!

Let’s go:

• Will Real Estate Prices Ever Drop? 🏡

• Gamestop & The Return of Roaring Kitty 🐱‍👤

• Are We REALLY In An “Altcoin Season”?! 📈

• What’s Fueling The BOOM in Bitcoin & Stocks? 📺

Today’s newsletter is a 5 minute read.

Will Real Estate Prices Ever Drop? 🏡

Real estate prices have skyrocketed to levels that make homeownership a pipe dream for many, especially the younger generations.

Even with mortgage rates still hovering above 7%, the average home price in the U.S. is above $400k.

This isn't just an issue of "I can't buy my dream home," but a multifaceted problem that impacts wealth distribution and quality of life.

For younger generations, the affordability crisis is acute:

• Millennials and Gen Z are often saddled with student debt and grappling with stagnating wages, making it nearly impossible to save for a down payment.

• Renting becomes the only viable option, and as rents soar in tandem with property values, the financial squeeze tightens even more.

Then there's the wealth gap:

• For those fortunate enough to inherit property, the value of these assets has ballooned, significantly boosting their net worth.

• This inheritance creates a stark divide between the haves and the have-nots, perpetuating economic inequality.

• The rich get richer, simply by virtue of being born into property-owning families, while others struggle to get a foot on the first rung of the property ladder.

Quality of life also takes a hit:

• With housing costs consuming a larger share of income, people have less money to spend on other necessities and pleasures.

• The stress of financial insecurity can lead to a host of mental and physical health issues.

• In extreme cases, it can result in people being priced out of their own neighborhoods, uprooting lives and communities.

Despite these challenges, don't expect a reversal anytime soon.

Desirable land is a finite resource, and with urbanization trends continuing, the demand for property in prime locations remains high.

Until we find innovative solutions to these deep-rooted issues, such as more affordable housing initiatives or significant policy changes, the trend of soaring real estate prices and its accompanying woes is likely here to stay.

Gamestop & The Return
of Roaring Kitty 🐱‍👤

The Gamestop (ticker: GME) saga entered a new chapter this week, as Keith Gill (aka “Roaring Kitty”) returned to Reddit and scheduled a YouTube livestream for Friday.

The world’s most famous retail investor claims to hold 5 million GME shares and 120,000 call option contracts, which give him the right to acquire 12 million more GME shares for $20 each.

At the close of trading on Thursday June 6th, those positions were worth more than $550 MILLION dollars. 🤯

Gill’s investment has helped re-energize the stock, with GME closing +47% on Thursday at $46.55 per share.

GME’s current market cap sits at just over $16 Billion.

Presumably we’ll find out during the livestream tomorrow if the real Keith Gill is actually behind all this recent action.

Will he answer some of the big questions surrounding these recent events such as:

• What has he been up to these last few years?

• How did he jump from $40 million of capital in 2021 to the $200 million used for his 2024 GME purchases?

• Did he buy & sell during the huge meme fueled rally in early May?

• Is someone else backing him or providing supplemental capital?

• Is he worried about legal repercussions from his recent trades?

• Does he plan to sell his call options for profit or exercise them in order to own shares?

• If he exercises the options, how will he come up with the necessary capital?

• Is his broker E*Trade (owned by Morgan Stanley) working with him or attempting to close his account?

• Does he have plans to join the GME Board or become an activist shareholder if he ends up with 17 million shares (~5% of the company)?

• Does he own any other stocks or crypto assets?

We doubt that Roaring Kitty will even address many of these questions, but we do think he will talk about why he is still bullish on GME.

Will that be enough to move GME higher? No one really knows…

Of course that hasn’t stopped a bunch of loudmouths from making crazy claims & conspiracy theories about why GME will rocket higher.

This is where we start to get worried for the average joe investor who doesn’t have a lot of investing education or experience.

Uninformed accounts are making outrageous claims that GME will go parabolic because market makers won’t be able to deliver enough shares if RoaringKitty exercises his call options.

Unfortunately, this isn’t quite correct, and we’ve even seen accounts using outdated 13F data to make this claim.

GME stock can still make wild moves, but the “HODL” for extreme prices mentality could end up hurting a lot of naïve investors.

Last time there was a 92% drawdown from the peak to the trough!

No one has ever gone broke scaling out some profit when a stock goes to crazy heights.

We hope many investors learned this lesson in prior GME pumps, but many probably did not.

We know there will be entertainment and volatility ahead for GME, so be prepared and tune into Daily Dough for all the major updates!

Are We REALLY In An “Altcoin Season”?! 📈

Altcoin season—the mythical period when every coin that's not Bitcoin (aka altcoins) takes off like a rocket ship. But are we really in the midst of one?

Let's dig into the details:

What Defines an Altcoin Season?

• “Altcoin season” typically refers to a period when altcoins (think Ethereum, Solana, Cardano) outperform Bitcoin.

• This usually happens when Bitcoin's dominance, which is its market share of the entire crypto market, declines.

• Traders and investors start shifting their funds into altcoins, hoping to capitalize on higher returns.

Current Market Conditions

To assess whether we’re in an altcoin season, let’s look at some key indicators:

1. Bitcoin Dominance: Bitcoin’s dominance has climbed above 50%, which historically signals a less than favorable environment for altcoins. Alternatively, when Bitcoin's market share shrinks, it often means money is flowing into other cryptocurrencies.

2. Altcoin Performance: Over the past few months, several altcoins have seen significant gains. Ethereum has climbed steadily. Solana has also experienced impressive growth, partly fueled by its expanding ecosystem of decentralized apps (dApps) and NFTs.

3. Trading Volume: Increased trading volumes in altcoins suggest heightened interest and participation. Platforms like Uniswap, a decentralized exchange for altcoins, have reported record trading volumes, indicating that more traders are engaging with these assets.

The Reality Check

Despite the promising signs, it’s not all smooth sailing for altcoins:

1. Performance Lag: About 80% of altcoins are still underperforming Bitcoin over the past seven days, 30 days, and even the past 12 months. This means that while some altcoins are doing exceptionally well, the majority are still struggling to keep up with Bitcoin’s performance.

2. Targeted Investing: So instead of us being in a shotgun season where you can just spread money across a ton of coins and get rich, you're better off being a sniper and selecting a few of the hot narrative crypto assets. Picking the right projects with strong fundamentals, solid development teams, and real-world use cases is crucial.

Our Take

So, are we really in an altcoin season?

On a dollar denominated basis, altcoins have been rising.

So, technically - Yes, we’re in an altcoin season…

But the majority of altcoins are still lagging behind Bitcoin, making selective investing crucial.

After all, why would someone take on the higher risk of an altcoin if it can’t out-perform bitcoin?

Video of the Day: What’s Fueling
The BOOM in Bitcoin & Stocks? 📺

What a crazy week in the markets!

With bitcoin & stock indices sitting at all-time highs…

Investors and traders are HUNTING for opportunity.

This week we’re diving into the driving forces behind these booms - and even giving some profit targets!

You’ll also learn:

• What key macro data should you be watching?

• How are the Bitcoin and Ethereum ETFs moving price?

• Why is the election set for a massive shake-up?

• And we answer some listener questions!

Food For Thought 🧠

"Owning a home is a keystone of wealth—
both financial affluence and emotional security.”
- Suze Orman

DISCLAIMER: We are not investment advisors, and this content is for educational purposes only. We don’t offer financial, legal, or tax advice. Nothing we say is a recommendation to buy or sell any assets. Trading and investing are extremely risky, so please be careful and do your own research.