GM, Lark Traders! This is Lark Digest, where we break down the market’s wild chaos into bite-sized, digestible insights.

Today, we’re diving deep into a Twitter thread that’s got me scared, stressed and hovering over the SELL button all at once.

On today’s menu:

• The Hidden Crisis Traders Aren't Focusing On❗️

• How To Master Your Market Understanding 🥇 

🇺🇲 This Hidden Crisis Could Change Everything

One of my favourite people to follow on Twitter is Balaji Srinivasan. The man is a genius and has made insane amounts of money.

For context, he:

1. Was one of the first people to sound alarm bells on Covid and almost perfectly predicted everything that happened.

2. When banks began to collapse last year, he sounded the warning bells and said Bitcoin was the lifeboat. At the time, Bitcoin was below $30,000 and has more than doubled since.

So, not only is he an intellectual follower, but he can also help you make a ton of money.

In the spirit of full transparency, no, I don’t even understand most of what he says. But nobody does market breakdowns quite like him so I spent all night 😴 studying his recent Twitter thread so you don’t have to (you’re welcome).

Here’s the idea: He says the US has way more debt than people think. He thinks a massive collapse is coming that will be far worse than in 2008.

But rather than fear-mongering, he backs it up with data. So let’s dive in, and I’ll tell you exactly why you need to pay close attention to this.

1. The Big Debt Picture 📉

According to Balaji, the Western world is heading towards a sovereign debt crisis far more severe than in 2008. The US debt is currently at a whopping $175 trillion. But what does this mean for you?

More Emergency Loans Than 2008: Did you know the Fed issued more emergency loans in 2023 than during the 2008 financial crisis? The banking system is on life support, reminiscent of a trader over-leveraging without a stop-loss.

2. The Borrowing Boom 💰

Balaji points out that the US is borrowing more under the "Biden boom" than during the peak of the COVID crisis. And this borrowing isn't at zero percent interest rates like during the pandemic—it’s at around 5%! Imagine maxing out your credit cards with a high interest rate to pay your bills. That’s essentially what's happening on a national scale.

3. Interest Payments Over Defense 💸

Here's a fun (or not so-fun) fact: Interest payments on the national debt are set to overtake defence spending.

That’s right, more of your tax dollars are going to bondholders than to national security. This shift signifies the enormity of the debt issue, turning interest payments into the largest government expense.

4. The Devaluation of the Dollar 💵

Doesn’t your grocery bill just absolutely suck lately? Mine sure does and that’s because the dollar has lost at least 25% of its value in just four years. Larry Summers estimates that the erosion is even more severe when factoring in the recent spike in loan payments due to rate hikes. Compounded over four years, this devaluation means each Dollar in your pocket is worth way less.

What Does This Mean for Traders? 📊

The Slow Burn of Inflation: Inflation can simmer for years before boiling over, but when it does, the collapse can be swift and brutal, occurring over days or weeks. Just look at historical examples like the Weimar Republic or more recently, Venezuela and even Argentina.

Ray Dalio’s Perspective: According to Ray Dalio, the US is in the late stage of its empire. But that doesn’t mean you should rush to short the Dollar. Instead, it’s a call to think long term and position yourself accordingly.

Long-Term Positioning: How can we do that? According to Balaji, Bitcoin is the lifeboat. It's finite, with only 21 million coins ever existing, and it's decentralized. That’s really all you need to know because this is the antipode to the crisis we’re seeing.

When banks like SVB collapsed last year, Balaji bet $1 million of his own money that within 90 days, Bitcoin would hit $1 million. Obviously, that didn’t happen, but he even said it was a long shot. However, we believe that directionally, he is 100% correct.

Remember, at Lark, it’s not just about avoiding pitfalls but also seizing the tremendous opportunities that come with the territory. If everybody is looking left, you need to look right.

We hope today’s email got you thinking. It’s a bit different than our usual style, so please let us know how you liked it at the bottom of the email!

🎁 $4,000 of FREE Courses

Do you want to master your understanding of the market?

Our Skool community just crossed 1,000 traders doing exactly that with over $4,000 of free courses.

By joining today, you’ll get:

🎁 The 12 Video Technical Analysis Course That I Used To Quit My Job ($3,000 Value)
🎁 The Ultimate Guide To Currency Fundamentals ($1,000 Value)
🎁 The 9-Minute Never Get Burned On News Trading Masterclass ($500 Value)
🎁 The Trading Plan That Helped Me Pass 4 $100,000 FTMO Challenges ($150 Value)

🤑 Total Value = $4,650.

Click below to join👇 

☕️ Pre-Market Fuel

1. Lots of brokers are opening their own prop firms. Here’s a list of some recent launches.

2. Deleveraging has begun in Canada. Perhaps it’s time for us to do a deep dive into this as well. Yes, Canada is a mess.

3. Is this the best 1-stage program in the industry? We think it is. 😉 

4. This video of Trump golfing is the best thing on the internet right now.

🍪 Digestible Memes

Share Lark Digest

Chances are you have some trading friends. Why don’t you be a pal, share Lark Digest and earn some goodies for it?

You currently have 0 referrals, only 1 away from receiving The Trading Plan That Helped Me Pass 4 $100,000 FTMO Challenges.

Or copy and paste this link to others: https://pipmunch.com/subscribe?ref=PLACEHOLDER