I am traveling Wednesday and Thursday so may not have time to get a newsletter out one or both days. Either way back on Friday

In Today’s Issue:

• Rareview 2X Bull Cryptocurrency & Precious Metals ETF

• Our Next Webinar—-Cash from Corruption: Profiting Off Washington’s Grift Machine

• Another TACO Tuesday?

• Why Preferreds Don’t Stink (and Most Bonds Do)

• P&C Insurers: Wall Street’s Overlooked Portfolio Theme

• Banking is Being Rewritten in Code

• The Time Will Never Be Right For Smart Beta

• and more……..

Cash from Corruption: Profiting Off Washington’s Grift Machine

- Two strategies to tap into Washington's grift with limited risk and unlimited upside

- How to use AI to recognize the next top themes before the "smart money" does.

- My simple hedging strategy that takes advantage of the real "dumb money" on Wall Street

To register:

Another TACO Tuesday?

SPY closed almost where it was Thursday night on rumors of easing tensions. Futures are in the red slightly on Trump’s tweet about everyone leaving Tehran. You also have to wonder what this is….

Trump Says He Is Working on Something 'Bigger' Than Cease-Fire-WSJ

Saw multiple “sources” on X last night either claiming the US had already joined the war or that Trump’s tweet and him leaving the G7 meant we were about to. As of yet not seeing anything showing we have though.

At this point though it looks like we are back to macro concerns and the FOMC this week…..

🚨 HEAT Formula Playbook: Themes

I still have no interest in investing in Europe, except for European defense names. UBS Global Strategy seems to agree on EU defense spending….

This stuff is always stupid, they have no way of knowing this. I’ll continue buying gold and the miners as long as the charts continue to tell me too……

🚨 HEAT Formula Playbook: Asymmetry

🚨 HEAT Formula Playbook: New Permanent Portfolio

Why Preferreds Don’t Stink (and Most Bonds Do)

I am working on a new white paper using the HEAT Formula concepts to modernize and potentially improve the Permanent Portfolio. A lot more to be said about that, but the original version had 25% in bonds. It’s no secret I think bonds suck, they aren’t a reliable hedge and they don’t provide asymmetric returns. The one exception to the rule is preferred shares, which I will be adding as a sleeve to my new Permanent Portfolio. I had GPT produce a very basic primer….

🧾 Primer: What Are Preferred Shares—and Why Should You Care?

Preferred shares are the hybrid lovechild of stocks and bonds. They sit above common equity in the capital stack, usually pay a fixed dividend, and often offer yields of 6–8% in today’s market. They don’t get the attention they deserve—and that’s exactly why they might be the smartest place to park capital in a broken bond market.

🔧 How They Work:

• Fixed Dividends: Like a bond coupon, typically paid quarterly.

• Seniority: Ranked above common stock, below debt.

• Callable: Issuer can redeem them—usually at par ($25)—after a call date.

• Perpetual or Long-Term: Many don’t have maturity dates (but trade like long-duration assets).

• Tax Advantages: Most U.S. preferred dividends are “qualified,” taxed at lower rates than bond interest.

💩 The Problem with Traditional Bonds

Let’s be honest: most bonds suck right now.

• Treasuries? Still yield less than inflation after taxes.

• Long-duration? Killed when rates spike.

• Corporate bonds? Offer 5%–6% with far more credit risk and zero upside.

If you’re going to tie up capital in fixed income, you need to be paid. Preferreds do that—with equity-like upside and bond-like stability.

I prefer buying individual bonds, but only if you have the expertise. One of our traders manages a preferred hedge fund so we may do a preferred ETF at some point, until them PFFA seems like a decent alternative. From a performance perspective it’s crushed HYG and AGG since inception and has a yield over 9%. It’s more correlated to SPY over the past 5 years (weekly) than AGG .629 vs .397 (source: Bloomberg) but less correlated than HYG .679 (source: Bloomberg).

🚨 HEAT Formula Playbook: Themes

I wrote about P&C a few weeks ago and have the only P&C ETF in the model portfolio. I think these companies offer a unique exposure and belong in a buy and hold portfolio. Jefferies just wrote a piece on hurricane season which caused me to want to revisit the sector…..

P&C Insurers: Wall Street’s Overlooked Portfolio Theme

Why selling hurricane insurance can outperform owning Treasurys during a storm

🔍 Executive Summary

While most investors ignore the insurance sector until disaster strikes, P&C insurers quietly compound capital in a way few other sectors can match—balancing defensive income, upside optionality, and inflation sensitivity.
The 2025 hurricane setup—paired with a maturing reinsurance cycle—gives us a rare entry point. As Jefferies notes, pricing power is likely to re-accelerate after any landfall, favoring select underwriters and brokers.

🧠 Why P&C Belongs in Every Portfolio

P&C firms don’t sell protection—they sell volatility insurance, and when the world panics, they get paid more. This is structurally asymmetric—exactly what the HEAT Formula is designed to capture.

🌪️ 2025 Hurricane Season: Setup & Strategy

Jefferies expects another active storm season, with elevated sea temperatures and a 51% chance of major U.S. landfall. But 2025 is still moderate vs. 2024, and that matters:

• Landfall tends to trigger short-term pullbacks in P&C names on loss fears.

• But post-storm, stocks re-rate higher as losses are smaller than feared and premiums rise.

🧩 Portfolio Construction: How P&C Fits

• Risk Profile: Low-beta + convex earnings exposure to catastrophe cycles

• Best Use Case: In a 60/40 portfolio or a rates-sensitive ETF, P&C acts as a volatility buffer and inflation hedge

• Options Strategy: Sell cash-covered puts on top P&C names during storm panic; buy long-dated calls post-landfall

• Reinsurance vs. Primary:

  • If no storm, primary insurers win

  • If storm hits, reinsurers win on back-end pricing power

🏆 Top P&C Picks (Based on Combined Ratio, CAT Strategy, and Market Position)

Note: RNR, ACGL, and EG are the three Jefferies highlights based on Southeast positioning and CAT leverage.

🧠 What the Smart Money Is Watching

1. CAT Bond Flows: Capital is returning to reinsurance markets (esp. ILS) → firms with cleaner loss ratios will benefit most.

2. FL Insurance Reform: Legal reforms are making Florida insurable again. Underwriters who leaned in (ACGL, EG) may win long-term.

3. Reinsurance Cycle Compression: A benign 2025 would soften reinsurance prices, helping primary insurers like WRB, CNA, and TRV.

🎯 Trade Ideas for HEAT Readers

🧮 Summary

In a storm-driven pricing cycle, P&C companies become volatility extraction machines. They sell financial “insurance” in literal and metaphorical ways—and when panic rises, their embedded optionality pays off. By using float, underwriting discipline, and catastrophe cycles, they deliver:

• Equity-like returns with bond-like risk,

• Inflation sensitivity, and

• Systematic crisis hedging.

That’s the holy trinity of uncorrelated return generation. And it’s why every institutional-quality portfolio should have P&C exposure.

Bottom Line for HEAT Readers:
Property & casualty insurers aren’t just a niche sector—they’re a strategic hedge with asymmetric upside. Whether the hurricane hits or misses, the opportunity lies in the reaction, not the event. And that’s where real money gets made.

🏦 Banking is Being Rewritten in Code

Why Stablecoins Could Trigger the Biggest Financial Shift Since the ATM—and Who Wins When It Does

This article caught my attention as I’m always looking for massive structural shifts and I think stablecoins is going to qualify……..

How Stablecoins Can Be Destabilizing-WSJ

I had GPT take a deep dive on this, and interestingly it brought up regional banks. I have a lot of reasons I started an inverse regional bank ETF but this wasn’t one of them…….

⚙️ The Setup: Stablecoins Aren’t Stealing Money… They’re Rewriting Where It Lives

Let’s be clear: stablecoins aren’t vaporizing bank deposits. They’re transforming them—from FDIC-insured retail accounts into uninsured wholesale liabilities, often pooled in mega-banks or shifted into T-bills and repo agreements.

The WSJ piece nails this nuance: deposits don’t vanish. But the way they behave changes radically.

• Your paycheck used to go into a small regional bank account.

• In 2026? It might land directly in a Circle-issued stablecoin, backed by 1–3 month T-bills, and held in a wallet you control.

• The cash never hits a regional bank’s retail deposit base—it loops through primary dealers, into money markets, or directly into JPMorgan’s wholesale vault.

The “deposit” hasn’t left the financial system—but it’s now:

• Harder for banks to lend against

• More flighty

• And no longer free capital banks can skim interest off of

🧠 Why Stablecoins Are Disruptive (Even If They’re “Still Dollars”)

Think of stablecoins as digital money-market funds on steroids.

They:

• Offer yield (e.g., Figure’s YLDS at 3.85%)

• Are programmable (you can embed payments, rules, limits)

• Settle instantly

• Travel globally

• Are non-bank, non-card-network dependent

You don’t need to route payments through the Visa-Mastercard cartel. And you don’t need to lend your dollars to Bank of America to earn 0.03% while they blow it on bond trades.

This is Blockbuster vs. Netflix all over again. But the theater this time is banking infrastructure, and stablecoins are the streaming platform.

📊 Who Wins and Loses from the Stablecoin Boom

🧨 But Here’s the Real Rub…

Stablecoins are draining the cheap deposits that regional banks rely on to fund loans. And they’re replacing them with volatile, high-balance, uninsured corporate accounts.

That’s exactly what triggered the Silicon Valley Bank collapse.

And the irony? Circle, one of the largest stablecoin issuers, had billions at SVB before the collapse. It got lucky when the government stepped in. But what happens next time?

🔮 Implications: What Happens Over the Next 36 Months?

1. Regional banks get squeezed

They can’t compete on yield, tech, or convenience. They lose depositors to:

• Money market funds

• T-bill ETFs

• Stablecoins
  And they’re left with higher cost of capital and reduced lending capacity.

2. Payment rails get disintermediated

Visa and Mastercard become less relevant as money settles directly over wallets and protocols. Unless they tokenize themselves (which they will), they risk Blockbuster status.

3. Treasury gets hooked

Stablecoins are backed by T-bills. That’s great—for now. But if everyone’s liquidity sits in 90-day government paper, what happens in a panic? Who buys when the sell wave hits?

4. Banks get bigger, riskier

Ironically, JPM and BAC may “win” on the surface—collecting larger balances. But these are hot-money deposits that can evaporate in a single blockchain-confirmed transaction.

🔍 Deep Dive: Public Company Exposure

🔼 Potential Winners

• CRCL (Circle) – IPO’d with massive traction, its USDC is regulatory friendly and transparently managed

• COIN (Coinbase) – Gains from custody, trading, and stablecoin velocity; it’s becoming the new “retail bank” for Gen Z

• V / AXP / JPM – If they issue their own stablecoins early

• FIGURE – First to launch a yield-bearing stablecoin (YLDS), with built-in distribution

🔽 Likely Losers

• BAC / WFC / ZION / KEY / NYCB – Retail banking is their lifeblood; without sticky deposits, their model breaks

• DFS / MA / PYPL – All at risk if they don’t adopt token-based systems for digital payments

• Unregulated or offshore stablecoins – Will face heavy scrutiny once U.S. regulation passes (GENIUS Act)

🧠 What This Means

You’ve always bet on themes with asymmetric upside and misunderstood timelines.

🔥 Positioning Strategy for Readers:

1. Long Circle (CRCL) and Figure, if available

2. Long COIN – becomes the modern retail interface to money

3. Short undercapitalized regional banks or buy puts

4. Long U.S. T-bill funds and brokers that benefit from demand

5. Track GENIUS Act progress closely – catalyst-driven opportunity

6. Monitor any announcement from Visa, AmEx, or JPM on token launches

🧠 Final Take

Porter Stansberry’s “banks are f***ed” thesis may be bombastic—but directionally, he’s spot on. The same way you don't buy DVDs anymore, you won't “deposit” money at a retail bank in five years. You’ll just move capital between wallets, platforms, and protocols—with no middleman and with interest.

If the dollar is going to stay dominant globally, it won’t be because of the Fed or the banks. It will be because stablecoins make the dollar usable anywhere, by anyone, in real time—and because Treasury debt is quietly being monetized through it.

This is a once-in-a-generation financial dislocation. Let’s play it accordingly.

🚨 HEAT Formula Playbook: Edges

The Time Will Never Be Right For Smart Beta

Here’s the problem. Edges do exist in markets, but once you discover “smart beta” type edges like low volatility, value, etc they get arbed out…..

The edges you want to look for are structural or behavioral, or are so intensive that they can’t be arbed out. For example, a structural edge is being short VIX ETPs (through puts please) as with the built in contango they are designed to go to zero. A behavioral edge is something like 2-4 period RSI which has been around since the early 90s but still works just about as well today as it did then. We also have ETFs like BWTG that have a process that’s so intensive that nobody has the infrastructure to match it.

Before You Go Some Ways I Can Help

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3. Monthly investing webinars

4. Rebel Finance Podcast https://www.youtube.com/@TuttleCap

5. Wealth Management-Coming Soon

6. Paid Newsletter Service-Coming Soon

   The views and opinions expressed herein are those of the Chief Executive Officer and Portfolio Manager for Tuttle Capital Management (TCM) and are subject to change without notice. The data and information provided is derived from sources deemed to be reliable but we cannot guarantee its accuracy. Investing in securities is subject to risk including the possible loss of principal. Trade notifications are for informational purposes only. TCM offers fully transparent ETFs and provides trade information for all actively managed ETFs. TCM's statements are not an endorsement of any company or a recommendation to buy, sell or hold any security. Trade notification files are not provided until full trade execution at the end of a trading day. The time stamp of the email is the time of file upload and not necessarily the exact time of the trades. TCM is not a commodity trading advisor and content provided regarding commodity interests is for informational purposes only and should not be construed as a recommendation. Investment recommendations for any securities or product may be made only after a comprehensive suitability review of the investor’s financial situation.© 2025 Tuttle Capital Management, LLC (TCM). TCM is a SEC-Registered Investment Adviser. All rights reserved.