This document discusses several scenarios related to real estate, cryptocurrency, commodities, and stocks. For real estate, it notes that the housing frenzy is driven by demographics like millennials becoming homebuyers and a long-standing housing deficit. Cryptocurrency adoption is accelerating due to involvement from large banks and institutions, though increased regulation may follow. Commodity prices are rising but bond yields and inflation concerns have calmed, potentially easing inflation risks.

1. SPRING FLINGS
06 May 2021

2. WAR ROOM
Idea Generation
Macro Coaching
Scenario Updates
HiddenLevers runs on SCENARIOS like Instagram runs on PHOTOS
Fed Underwrites Economy
Climate Disasters
Real Estate “Post” Covid
COVID 2.0

3. SCENARIO PULSE CHECK
YIELD SHOCK – Bonds calmed at higher level
VACCINE REBOUND – GDP +6.4%

4. sources: HiddenLevers, NY Times, Bureau of Transportation Statistics, Airline Weekly
LEVER PRICE
BTC Up 95% YTD, off highs
LUMBER All-time high @ $367
COPPER Near all-time high @ $4.54
GOLD Down 12.5% from 2020 high
OIL +38% YTD to $65/barrel
USD Flat YTD, down from highs
Inflation hitting pandemic growth sectors – does a full reopening take this economy wide?
ECON PULSE CHECK

5. sources: HiddenLevers,
REAL ESTATE POST COVID SCENARIO RETIRED
March 2017
Home buying frenzy is nation-wide, not just sunbelt

6. sources: Apartment List, BofA, Pew, HiddenLevers
Mortgage Rates = All time lows
Projected Population by Generation
1 in 4 Millennials has at least 100k
Saved
2015 - Basement Dweller
2020 – Home Buyer
New Buyers Flood the Market
US HOUSING HOUSING DEMAND

7. sources: The Atlantic, WSJ, NYT, HiddenLevers
US HOUSING INSTITUTIONAL DEMAND

8. sources: HiddenLevers, Marginal Revolution
• Restrictive zoning + lack of labor supply slowed post-2008 construction rebound
• 3.3M deficit in home supply could take a decade to remedy
Housing Starts Deficit Math
1.43M/year avg: 30.1M
Actual Total: -26.8M
Deficit: 3.3M
1960-Now
1.43M Avg
US Housing Starts, 1960 to Present
2008-Now
990K Avg
US HOUSING HOUSING DEFICIT

9. US HOUSING GOOD
Pandemic only
accelerated it
Millennials
saved up
Millennials at
that age
Generational
Shift
Home Prices
264
+11%

10. US HOUSING BASELINE
Homeowners
staying put
Housing deficit
pre pandemic
nationwide
problem
Lack of Inventory
Home Prices
251
+5%

11. US HOUSING UGLY
All cash buyers
limit impact
Record low
mortgages
Housing inputs
showing inflation
Yield Shock
Home Prices
226
-5%

12. GOOD
S+P 500
3500
-15%
S+P 500
4400
+6%
S+P 500
4000
+1%
BAD
COST OF MATERIALS
SKYROCKETING, EVIDENCE
OF OVERHEATING ECONOMY
MILLENNIALS RISING IN US
HOUSING = 5Y TREND,
HASTENED BY PANDEMIC
HOUSING DEFICIT
ARTIFICIALLY MADE WORSE
BY LOCKDOWNS
US HOUSING MACRO RISK PARITY
BASELINE
Yield Shock
Lack of Inventory
10Y
1.57
FLAT
10Y
1.80
+23 bps
10Y
3.30
-173 bps
Generational
Shift
Home Prices
251
+5%
Home Prices
264
+11%
Home Prices
226
-5%

13. sources: HiddenLevers,
CRYPTO MANIA SCENARIO UPDATE
Crypto coming of age, with banks + big tech involved

14. CRYPTO MANIA ON BALANCE SHEETS
sources: Fidelity, Defirate, CoinGecko, HiddenLevers

15. CRYPTO MANIA BITCOIN RALLY = RECENT
sources: Fidelity, Defirate, CoinGecko, HiddenLevers
SECURITY AVG DAYS HELD
DOGECOIN 2
BITCOIN 15
GLD (GOLD ETF) 60
APPLE 180
AMAZON 180
GOLD BULLION INTO PERPETUITY
DID INSTITUTIONAL ADOPTION CAUSE THIS RALLY?
OCT
10K
DEC
20K
JAN
30K
FEB
50K
APR
60K
BTC – CLOSER TO DOGECOIN OR GOLD?
SECURITY Total Market Cap
BITCOIN 1.0 Trillion
ALL CRYPTO 2.4 Trillion
GOLD 9.0 Trillion

16. CRYPTO MANIA GOOD
Digital wallets
ubiquitous
Big banks crypto
custody
Crypto ETFs for
WM + AM
Institutional
Adoption
BTC
200K
+250%

17. CRYPTO MANIA BASELINE
Mega cap tech in
2021 is Meh
Crypto market
cap now $2.4T
FOMO here, not
in growth stocks
Steals Nasdaq
Thunder
BTC
85K
+50%

18. CRYPTO MANIA UGLY
digital dollar
beta underway
US govt will keep
its monopoly
US has outlawed
gold in 1930s
Govt Ends Party
BTC
22.7K
-60%

19. GOOD
BAD
GOVT CAN OUTLAW CRYPTO
AS IT PREVIOUSLY
OUTLAWED GOLD
MAD RUSH FROM BIG BANKS
TO MEET CRYPTO DEMAND
GROWTH EQUITY OUTFLOWS
=
CRYPTO INFLOWS
CRYPTO MANIA MACRO RISK PARITY
BTC
85K
+50%
BASELINE
BTC
200K
+250%
BTC
22.7K
-60%
Govt Ends Party
Steals Nasdaq
Thunder
Institutional
Adoption
S+P 500
3550
-15%
S+P 500
4360
+5%
S+P 500
4000
-4%
NASDAQ
12.2K
-10%
NASDAQ
14.3K
+5%
NASDAQ
11K
-20%

20. US Housing frenzy based on demographics;
Crypto frenzy based on institutional adoption
Bank crypto adoption will lead to more regulation
US Housing deficit has been 10 years in the making
Inflation can’t justify crypto rise, rates now falling
SPRING FLINGS WHAT TO SAY

21. TECH CARNAGE JUNE WAR ROOM
OOPS!