Bitcoin is in a clear bubble, says Ariel Investment's Charles Bobrinskoy

Could end badly here with opportunities outside of crypto is Charlie Bobrinskoy, who is vice chair and head of the investment group at Ariel. What a back to back pairing, Charlie. Welcome. Love to hear your thoughts. Thanks for having me, Kelly. The headline is that Bitcoin is going up because it has gone up recently. People are playing this momentum. They have seen people on television get rich. This is a get rich quick scheme. Get rich quick schemes always end badly. There is no they used to pitch it as being having transactional value. Now they are admitting that the only value it has is store of value. And what and where he Mike is wrong and God bless him, he's he's done very well and built a real company where he's wrong is in thinking that the government has had a sledgehammer against their knees. Bitcoin has less regulation than other commodities, less regulation than foreign currencies. It is benefiting from. In fact, that's its main appeal. That's why it's used by blackmailers and foreign terrorists is because it isn't regulated. You can send massive amounts without having to live with know your customer rules, the way that banks have to deal with a fifty thousand dollar deposit. Try making a fifty thousand dollar payment out of Bank of America. You will get lots of questions about know your customer. So the point of this is that it has gone up because it's gone up and it will go down dramatically if it starts to lose that momentum. And that will happen. Mike's right in the short term. Regulation is unlikely to get worse. But there are lots of people in the government who do not believe that undermining the U.S. dollar is a good thing for the U.S. and who are worried about individuals getting badly hurt. Yeah, by the way, I'm still in the camp that I don't like the dollar being the reserve currency. It makes it too expensive. This is what's hollowed out our manufacturing base. It's criminal. The fact that we're putting tariffs on China when all this could be solved, if they didn't artificially suppress their currency, it's like we're creating two problems to solve the original one. I agree with you, but we've got thirty three trillion dollars worth of debt and people better believe in the dollar or we're problems are going to be a lot worse. We can serve. We can service that. Households will buy it. We saw how many people created a Treasury direct account for five percent rates over the past couple of years. One hundred percent we could fund this. You know, a lot of U.S. Treasury securities are owned by foreign entities. Yes, because they have to because they have to buy them in order to keep their currencies low. And if they didn't do that, they wouldn't be enabling this massive debt pile that we now have to deal with. So you may be right. My point is that the U.S. government and the leaders of Federal Reserve and frankly, members of Congress do not believe it's in the best interest of this country long term. I know. Undermine the dollar. And I think and crypto is all about undermining the dollar. And so I think they're they are not as regulated as he thinks Mike thinks they are. They are certainly less regulated than other commodities, other financial assets in the short term. He's right, because the regulatory environment is not going to get worse. But I think longer term regulation is more likely to go up than down, which is a great point about kind of how it's going to mature as a kind of traditional and classic financial asset class. Charlie, you mentioned that you kind of and so did Mike share this concern that not only crypto, but the S&P, the markets are kind of frothy right now. So what's the practical advice to do about all of that? Great question, Kelly. We don't think you should trade tactically. All the evidence says that people, when they try to trade around valuation, do it exactly wrong. They buy at the top and they sell at the bottom. That's why the average investor doesn't get as good a return as the indexes do. But you can make adjustments and you can do small things. Warren Buffett has been trimming positions. We do believe right now is a good time to trim stocks that have run too much. There are things like giving appreciated stocks to your favorite charities. This year, you can get a full tax deduction on an appreciated stock without paying the capital gains. Get the deduction this year. We would advise doing that. And frankly, I would advise going down the risk spectrum a little bit, taking some beta off the table. The nice thing here is one industry that's gotten beaten up is the health care industry, with people being worried about Kennedy coming in. And so there are a lot of low beta, less cyclical health care stocks that are more attractive. So on the margin, take risk off, maybe even put increase your cash, give to your favorite charity and don't add more at the top.