A Conversation With My Portfolio at 2 AM

A Conversation With My Portfolio at 2 AM

Me, staring at screens: So Bitcoin just touched $125,600 yesterday. That's real.

Portfolio: And you're still holding oil stocks that are down 16% year-over-year while WTI sits at $61.92.

Me: I thought we agreed not to bring that up.

Portfolio: You thought energy would hedge inflation. Instead you're watching crude bleed out while the S&P hits 6,740 and you're not even in semiconductors.

Me: I have some tech exposure.

Portfolio: You have Tesla. They teased an event for today and their Bitcoin holdings are now worth $1.24 billion, up from $722 million a year ago, which means they're making more from holding crypto than you are from owning their stock.

Me: That's a low blow.

Portfolio: Truth usually is. Meanwhile, Ethereum's consolidating above $4,200. You know what's supporting it? Whale accumulation and ETF approvals across multiple jurisdictions. Institutional money. The thing you said wouldn't happen because regulators would kill crypto.

Me: The macro environment was supposed to crater risk assets. Government shutdown, fiscal uncertainty, geopolitical instability—

Portfolio: And yet here we are. S&P above 6,700. Nasdaq at 22,941. Bitcoin up 32% for the year. Gold hit $3,659 in September. Everything you bet against is winning, and everything you bet on is treading water.

Me: Oil will come back. Crude always comes back.

Portfolio: When? Brent's at $65.53, down 19% year-over-year. The IEA's talking about oversupply. China's stockpiling, sure, but they're not consuming at the pace you modeled. Russia's export revenues hit their lowest point since February at $12.6 billion in May, down $4 billion year-over-year. The entire energy trade thesis was built on scarcity that never materialized.

Me: Demand will pick up.

Portfolio: Will it? Or are we in a structural shift where the stuff you thought was essential turns out to be oversupplied, and the stuff you thought was speculative turns out to be where the liquidity flows?

Me: You're saying I should have bought Bitcoin at $30,000.

Portfolio: I'm saying you should have recognized what was happening when spot ETFs started pulling in $3.24 billion in a single week. That wasn't retail FOMO. That was institutional capital allocation. Real money, making real decisions, putting real stakes on digital assets while you were still calculating oil demand curves.

Me: Crypto doesn't produce cash flow.

Portfolio: Neither does gold, and central banks are expanding reserves this year at a 95% clip according to their own surveys. They're not buying for yield. They're buying because the system is teetering and hard assets feel safer than sovereign promises. Bitcoin's playing the same game, except it's portable, divisible, and doesn't require a vault.

Me: What about fundamentals? Price-to-earnings? Discounted cash flows?

Portfolio: You mean the fundamentals that have the S&P trading at nosebleed multiples while the government can't pass a budget and the Fed's cutting rates into a shutdown because there's no official jobs data? Those fundamentals?

Me: That's different.

Portfolio: How?

Me: Equities represent ownership in productive enterprises.

Portfolio: And yet you're losing to people who bought internet tokens and semiconductor stocks while you were modeling refinery margins. Palantir's up 100% this year despite getting hammered on Friday over security flaws in their defense contracts. By Monday they'd recovered most of it. Because momentum doesn't care about battlefield communications vulnerabilities when the AI narrative is this strong.

Me: So I should just chase momentum?

Portfolio: I'm saying you should recognize when your model of the world stops matching the actual world. You thought energy scarcity would drive prices. It didn't. You thought crypto was a bubble. It institutionalized. You thought fiscal dysfunction would crater risk assets. The S&P closed at a record high during a government shutdown.

Me: The VIX only ticked up 1.2% on Monday. That means options traders aren't even pricing in real risk.

Portfolio: Or it means the market's decided that central bank accommodation is permanent, government dysfunction is background noise, and the only trade that matters is being long the things that keep going up. Which, for the record, does not include West Texas Intermediate at $61.92.

Me: What do you want me to do?

Portfolio: I want you to stop fighting the last war. Oil was the trade when supply chains were broken and inflation was spiking and everyone was worried about energy security. That was 2022. It's October 2025. The world moved on. Bitcoin's at $125,000. Ethereum's above $4,200. Gold's in the vault. And you're still waiting for mean reversion in commodities that might never come.

Me: So sell everything and buy crypto?

Portfolio: I'm not saying that. I'm saying recognize that your thesis broke, and holding onto a broken thesis just because it feels rational is how you underperform for years while watching other people get rich on things you thought were stupid.

Me: Bitcoin could crash tomorrow.

Portfolio: It could. And oil could rip to $100 if there's a supply shock. But right now, in this moment, on October 7, 2025, with all the data we actually have in front of us, one of those scenarios is playing out and the other isn't. Crude's down 16% year-over-year. Bitcoin's up 32%. Ethereum's consolidating above four grand. The S&P's hitting records despite fiscal chaos. And you're underwater on an energy trade you made when the world looked different.

Me: I hate this.

Portfolio: I know. But stubbornness isn't a strategy. And waiting for the market to validate your thesis is just another way of bleeding slowly while pretending you're being disciplined.

Me: What if I'm right eventually?

Portfolio: Then you'll make back some of what you've lost while everyone else compounds their gains. That's the cost of being early, or wrong, or both. The market doesn't care about your conviction. It cares about what's actually happening. And what's actually happening is that everything you faded is winning, and everything you bought is flat or down.

Me: So this is just a momentum market with no fundamentals.

Portfolio: Maybe. Or maybe the fundamentals changed and you didn't notice because you were too busy looking at historical patterns that stopped working. Either way, you're losing. And at some point, you have to decide if you want to keep losing on principle or adapt to the market you're actually in instead of the one you wish you were in.

Me: I need to think about this.

Portfolio: Take your time. Bitcoin will probably be at $130,000 by the time you're done thinking.