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What's really moving these markets
Wall Street Unplugged
Episode: 831December 14, 2021

2022 forecasts call for huge volatility… Here’s how to play it

As we near the end of 2021, investment banks are making predictions for 2022… and they’re calling for volatility. Paying attention to these predictions can give you a massive edge in the markets. [0:30]

Now, we all know consensus predictions aren’t always accurate—take the early forecasts on COVID, for instance. You’ve got to be willing to question the “status quo”… and invest accordingly. [1:28]

I list several companies poised to continue growing regardless of volatility in 2022. [5:36]

Speaking of predictions, I share my expectations for interest rate hikes next year… and why investors should prepare for some large pullbacks in the market. [8:20]

Another factor adding to the uncertainty for next year: inflation. I break down why Genia Turanova’s Moneyflow Trader strategy is my favorite way to hedge against downside risk… while still profiting from market momentum. [18:10]

Turning to questions… a listener wants to know how we plan to keep investors updated once our Curzio Equity Owners (CEO) token begins trading on tZERO. I share why I’m strongly committed to transparency… and the steps we’re taking to ensure we always remain that way. [21:37]

Finally, what are my favorite sectors for 2022? I highlight more of my favorite ways to position for next year… including the sectors where I’m seeing enormous momentum and innovation. [24:22]

Inside this episode:
  • Investment banks are calling for a volatile 2022 [0:30]
  • Why you’ve got to question the “status quo”… and invest accordingly [1:28]
  • Companies poised to continue growing next year [5:36]
  • How much will interest rates rise in 2022? [8:20]
  • Why the Moneyflow Trader strategy is my favorite way to hedge [18:10]
  • The CEO token and our plans for transparency [21:37]
  • Frank’s favorite sectors for 2022 [24:22]
Transcript

Wall Street Unplugged | 831

2022 forecasts call for huge volatility… Here’s how to play it

Announcer: Wall Street Unplugged looks beyond the regular headlines heard on mainstream financial media to bring you unscripted interviews and breaking commentary direct from Wall Street right to you on main street.

Frank Curzio: How’s it going out there? It’s December 14th. I’m Frank Curzio, host of the Wall Street Unplugged podcast, where I break down the headlines and tell you what’s really moving these markets. So, as we approach year-end, like always, the largest research firms which, the Goldman Sachs, JP Morgans, Morgan Stanleys, they provide a 2022 forecast. And, I want to go over these forecasts with you, since I know many of you might not have access to the data. Maybe you’ll hear a data point on CNBC or be able to read it. But, having access to these reports and seeing where they’re coming from, I wanted to go over a lot of this stuff with you. And the reason is, you need to pay close attention to what the sell-side analysts, these are called sell-side analysts, are saying about the economy, different sectors, and stocks, because that’s usually the status quo.

Frank Curzio: So, if you can prove through your research that these forecasts are going to be wrong, and I’m talking about to the upside or the downside, that’s how you make huge returns. Because by doing that, it means this data, right? If your research is correct, it’s not being priced into the market. So, a good example of that was say, in February 2020. When I was reading the research analysts, this is why I became more and more bearish, because I felt like people weren’t seeing what I was seeing, and what I was hearing through amazing contacts, and interviewing people in China and Italy. And again, this is before the markets crashed, right? Because they were closed for COVID. So, everybody thought it was going to be a quick downside followed by a strong rebound. And, when I say quick downside, it was like Goldman and Morgan Stanley predicted, a quarter, one quarter of weakness. They were comparing it to other past pandemics.

Frank Curzio: And, this turned out to be much, much longer than expected, right? Over four quarters, five quarters. We’re still dealing with some of that stuff now, where we still wear masks and it’s impacting the economy in certain areas, especially in New York and California, and also international travel. I mean, this is still going on now, COVID, right? They said it was going to be one quarter and we’re going to be fine. For me, I thought differently, since China actually closed its economy. Apple, Levi, you’re looking at all these major brands were closing in China. And this happened the first week in February, two, three weeks before the market really started to crash. China accounts for 40% of the world’s growth. We’re trading at crazy, crazy valuations, very expensive valuations, which is fine. However, if you notice right before that point, that last quarter going in, GDP was slowing. It was under 2%.

Frank Curzio: So, we’re seeing a slow down with premium prices. Now, you’re taking away the growth component. The growth component of the world had the equation, they’re closing their entire economy. So for me, I thought it was inevitable, stocks fall much more than, I mean, that quick pullback. Some of them were saying, “Hey, we could see a five, 7% pullback.” That’s what they were predicting in the pandemic. And it turned out to be 30%, which is a little bit more than I expected. I thought we were going to get nailed, but not that quickly, 30%. Now, why did it fall that much? Because all the major institutions, they were on the wrong side of this trade. They were forced to adjust and sell positions, while these positions were pushing lower. They got like a short squeeze or something. If stocks are going higher and higher, people are like, “Oh, we got to get out. We got to get out before it goes higher,” because they’re short.

Frank Curzio: So, that’s what a short squeeze is, that’s GameStop, AMC, and all these things. But when you could look at these sell-side forecasts or any forecast, right? If everyone’s completely bullish on a stock, that means sentiment is very, very high. That’s what we saw, with what? We saw that with Peloton. We saw that with DocuSign. DocuSign fell 40% in one day, tens of billions in market cap wiped out. So, if you’re doing your research, and saying, “Wow, these guys who are all involved in this stock are wrong. Either upside, downside.” That’s how you make the greatest returns. So, I want you to pay close attention to these forecasts. They’re very important, because if you could find a hole in their research, you could make very, very strong, exceptional gains.

Frank Curzio: So, starting with… Piper Jaffray just came out. They said… They surveyed 91 chief investment officers across multiple verticals, primarily within North America. And this is all the technology. And they said overall, 2022, the IT budgets are anticipated to be up over 5%, year-over-year. That’s a major, major increase, because they went up 5.4% in 2021, coming off of numbers that people worried about from 2020 and COVID. So despite the uncertainty, despite inflation, you’re looking at the biggest technology companies in the world are still spending, and plan to increase their budgets on IT, which is interesting.

Frank Curzio: You look at Stifel. So, they say three potential correction catalysts, and these guys have the biggest downside number in the S&P 500. So, you say three potential correction catalysts. So, I say cyclicals, first defensives, and equities are extended. So basically, they’re saying money is rotating into the venture sector of stocks. They also say, the slowing global money growth, especially as the dollar rises and tightens liquidity. And also, they’re talking about China. Because China, the past tightening, despite easing now late after Evergrande, weakens global growth. So, they’re predicting the S&P 500 would be in the low four thousands by Q1, 2022. I mean Q1, that’s a couple weeks away. Starting in a couple weeks away. And, that’s 10% downside from the current levels. It’s a pretty big number.

Frank Curzio: Goldman Sachs says, “The risk of recession appear low,” continue to recommend high growth and high margin stocks. And they say, “As high margins are a signal of quality, indicate these stocks are likely to outperform their lower margin counterparts, amid uncertain macro backdrop and tightening financial conditions.” So, they see the S&P 500 going to 5,100 in 2022. That’s about 10% upside. Just give you a little bonus here. Some of the stocks they like, they’re talking about the high margin stocks, MasterCard, MP Materials, that’s MP as a symbol, United Therapeutics, Universal Display, Nvidia, Marvell Technology, Autodesk. Who knows how many technology companies are on this list? These are usually high margin companies. Alphabet, Meta, Insight, Booking, Holding. So, Palentir. These are some of the names that they like, high margin companies going into next year. Because look, those are the companies that are going to have pricing power.

Frank Curzio: JP Morgan, “2022, the year of a full global recovery, and ends the global pandemic, and a return to normal conditions we had prior to the COVID-19 outbreak.” Their price target is 5,050. All right, 5,050. So, we’re looking at about 9% upside, pretty close to Goldman. So, one of the things they do say, is they say, “International equities, emerging markets, and cyclical market segments will significantly outperform and deliver two to three times higher returns in the US markets.” That’s a pretty bold statement. That’s interesting.

Frank Curzio: And then you have Morgan Stanley say, “The surge in global inflation has investors fretting about future growth,” but their economists say, “Prices, those surges, that inflation is going to subside, making the way for 4.7 GDP growth in 2022.” Yet, its price target on the S&P 500 is 4,400. So, we’re looking about 5% downside. So, let’s throw all this, right? These are the expectations going into 2022. So, let’s put all this together, and I’ll break it down, show you what it means.

Frank Curzio: If you take the highest and the lowest forecast, right? You’re looking at 10% upside, 10% downside. I’m going to say from someone who’s been doing this for a very long time, that’s one of the widest margins you’ll ever see, going into predictions next year from major firms. You might have a boutique firm that says, “We’re going to crash 30%,” or whatever. It doesn’t matter. But from these big firms, you see three, 4% returns and maybe 7% returns. I mean, outside of COVID, because we saw a massive decline followed by all this money printing, and stimulus, and so those returns are high. But usually, going back historically, four or 5% returns, maybe 8% returns and maybe two, 3% to the debt, you don’t see that big of a margin, right? It’s a very, very wide margin. And what does that tell you? It tells you how much uncertainty we have in the markets right now and what we’re going to see in 2022.

Frank Curzio: So, when I look at that data and I go over my forecast, this is my forecast. I think we’re going to see at least two to three separate 20% pullbacks. And, this is going through 2022. I think investors are going to try to buy the dip like they’ve been doing for five years plus, like buy, buy, buy, buy, buy, but it’s a different market now. And when you have low interest rates, you have the Fed there to pick you up, and everything’s going to be okay, and just throw money at everything, and hand checks to everybody, listen, buy the dip makes sense. It makes sense that a lot of these companies have premium valuations. It makes sense of how much liquidity’s coming into the market, where we saw a record amount of deals flow, a record amount of assets trading at record highs. It makes sense for those conditions.

Frank Curzio: However, in 2022, we’re going to see a fundamental shift. I say a fundamental shift, because that’s what we saw in 2020. It was a fundamental change in the marketplace. In other words, I’m not saying that the market’s going to fall because they’re expensive. You could say that for the last five years on a historical basis. Again, people weren’t factoring in low interest rates, and the Fed, and fiscal policy, just throwing money at everything. So, you deserved stocks to be trading higher than the normal, which is probably 17 times forward earnings over the past 10 years. And we were trading in 2021, times forward earnings. So, the fundamental shift we’re looking at in 2022, okay, it’s a different landscape. It’s a different animal. So, you’re looking at the Fed, that’s going to begin raising rates.

Frank Curzio: My forecast? At least four times. At least four times next year. They have to start. I mean, you saw Powell, you’re going to see him Wednesday. He’s going to talk about it. I mean, you’re going to see tapering much, much faster than I expected. You have to. I don’t know if you saw inflation numbers, you look, I mean the CPI, I’ll cover that in a minute, and the PPI just came out today. But the Fed’s going to stop buying bonds completely in a few months, right? Why? Because it’s been brought on by massive, massive inflation it needs to control. So, you have the CPI up 7% year-over-year, which is a 39-year high, and producer price just came out today, showing a near 10% increase in prices. We’ve never seen that in history. Right? And I read that through several headlines, so you can double check that. But even if it’s not, it’s one of the highest ratings that we’ve ever seen on producer prices. That’s how much these prices have gone up.

Frank Curzio: But, comparing inflation, the CPI to the eighties, right, because that’s where we’re really comparing it, the seventies and eighties, which is the third, nine year comparison. It’s misleading, because the index is calculated totally differently now. In fact, over the past 30 years, the government has changed the way it calculates inflation, and that’s a CPI, more than 20 times. Why do you think they’re doing this? They’re not doing this because we want to make it more accurate. No, absolutely not. You really believe that? They went, “Oh, we want to make it more,” no. They want to show mild inflation, since inflation is by far the biggest risk to the market. It’s the one thing the Fed can’t control by throwing money at it. You have to remove money from the system, you have to deleverage. But in the seventies and eighties, the CPI included housing prices. But now, we use a non-market rent for owners’ housing costs. That’s what it is, non-market rent for owners. That’s the housing costs.

Frank Curzio: Also, today, the government makes the assumption that consumer spending habits change as economic conditions change, including rising prices. So prices rise, and consumers decide to substitute that product, whatever. Say, “I’m not buying a Snickers, because Snickers are $3 now, and they were a $1.50.” Just say. “I’m going to buy M&Ms now.” It takes Snickers off the list, as its basket of goods it covers. Think about that for a minute. This way, it’s not going to report those higher prices for that product. So, I’m not sure how you measure inflation then. But if you’re looking at apples to apples comparison, or the way we calculate inflation in the eighties, right? And if you compare that to today, inflation as CPI, is at higher levels than it was back then. Much, much higher levels, right? Where it’s 7%. You want proof? I mean, it’s not too difficult to find it. I mean, you could find it almost any place.

Frank Curzio: But if you’re looking at a basket of goods and how much these things have gone up, just look at used cars. You could look at, which are up 30%. You have beef, which is up 24%. You have gasoline up 51%. You have rental vehicles up 40%, furniture up 12%, bacon up 20%, gasoline, again up about 50%. These are the numbers that you’re seeing. These are numbers that I’m seeing. These are the numbers that for some reason, the Fed’s not seeing. But for you to say that consumer prices are up only 7%, it’s absolutely insane. You’re basically, the Fed calls us a bunch of idiots, but they do this because that’s the new way they calculate CPI. And it’s not really that new, but that’s how they change it over the years.

Frank Curzio: But going into next year, where I’m going with all this, you need to be concerned. We had strong returns in the market for three straight years. I mean 31%, 18%. What do we have now in the S&P 500? 24%, something around there, 25%? The market usually goes up 8% annually every year. And I get it, why it went up so much, and those are the reasons why we were bullish for so long. But now, with this fundamental shift, the changes in the marketplace, and these changes, we’re going to see leverage come out of the market with the Fed tightening and tapering. Inflation’s going to continue to rise, as companies are under incredible pressure to report higher earnings every single quarter. That’s your job as a company. Every single quarter, we need to grow, grow, grow, grow. You know why? Because if you miss with the valuations that they’re currently trading at, if you miss, you become DocuSign. You lose 40% in a day. PayPal, down 40%. Peloton down 50, 60%.

Frank Curzio: So, what does that mean? They’re forced to raise prices. Some companies are going to get away with it. Large technology companies will be fine. They all have trillion dollar valuations. They control the world. They have pricing power. But how many companies are going to be able to continue to raise prices to the point where people are like, “All right, I’m done. I’m done. I’m not going to Chipotle anymore. That used to cost me seven, $8 for a meal. And now I’m paying 12, $13. I can’t afford it. I can’t afford it for the whole family.” And I get it. But where these companies are raising prices, it’s going to create even more inflation. And then you throw in the new variants of COVID, which are going to come out forever, and how the government reacts and the media reacts. I mean, that just creates another layer of uncertainty, which we know uncertainty is terrible for stocks. That’s what we’re seeing right now, right?

Frank Curzio: A big mix, Omicron. Look at like two, 3% moves in the market, back and forth, back and forth, back and forth. And, we’re going to see things like that every single year going forward. But if you take all of that together, we’re looking at a super risky market, probably the most risky market than any other time since the credit crisis. And guys, we’re seeing the craziness right now. I mean, the major indices are holding up pretty well, down less than 5% from their highs. But if you look at the breadth of the market, it’s extremely ugly. For example, you look at the NASDAQ. So, the NASDAQ has over 3,600 stocks in it, and it’s down around 4% from its 52-week high. But the average stock in the NASDAQ is down 40% from its highs right now. If you’re looking at the Small Cap 600, that’s off about 6% from its 52-week high. Okay, not that bad. Had nice moves from the past few years. Yet, the average stock of that index is down close to 25% from its highs.

Frank Curzio: So, if you’re wondering why your portfolio is down 10, 15%, but yet, you’re looking at the markets and they seem to be holding up, that’s why. A lot of names are getting crushed. Plus, we’re seeing stocks that underperformed this year. They’re selling off even more over the past few weeks, mostly due to tax loss selling. More relevant this year, we’re up 25% on some of those stocks. Yet, you’re seeing lots of losers in your portfolio. Probably more losers than winners, because the top half is really controlling the entire market. Those five, six, $7 trillion valuations, they account for 51% of the gains in the S&P 500 since April. That’s according to Goldman Sachs. It’s crazy. So, what are you doing? “Well, all right, let me sell some of these things, so I don’t have to pay taxes.” And you’re seeing a lot of these names get hammered, especially meme stocks, AMC, DraftKings, Virgin Galactic, GameStop. Have you seen the moves in these names, to what’s going on? And they’re getting destroyed right now.

Frank Curzio: I’m not trying to scare you. I’m not. You know me, you listen to me for a long time. I’m not saying, “Well, the markets are going to crash, crash, crash, crash, crash,” because I want you to buy products and sell newsletters. I’ve seen that for 30 years for people, “The dollar’s going to lose this reserve currency status, the market’s going to crash, 30, 40%.” Bullshit, I’m not one of those guys. I’m just saying there’s times to be aggressive, pedal to the metal, which for the past five, six, seven years, interest rates low, money flooding the market. Everything’s fine as the price is going higher. And there’s times to play defense, like now. It’s going to be completely opposite. The Fed raising rates is a big deal.

Frank Curzio: It’s a huge difference between a 3% mortgage rate and a 5% mortgage rate. That’s something you can identify with. We were at 5% what, a couple of years ago? And we’re, just were 3%, a little bit more than that, on a 30-year. I mean, that’s where we’re heading. What do you think that’s going to do to the housing market? You think people are going to buy as many houses? Absolutely not. They’re going to refinance as much? Absolutely not. That’s money coming out of the market. That debt that you need to service, it gets more expensive. So, the days of having $80 billion cryptocurrencies that really have no use and no utility functions, the days of AMC trading at a valuation of where it was, at 60-70, or Virgin Galactic with almost no revenue trading at six, seven, eight billion, even if it was more than a $10 billion valuation, that’s crazy. That’s crazy. When do I see revenue growth for that company? I don’t know, how many ships they got to get up there? I mean, it’s crazy, the business model. And the guys who invested in that already made their money.

Frank Curzio: But again, I’m not trying to scare you. It’s just going to be an incredibly volatile market next year. And to reset yourself, to protect yourself here, I suggest buying puts. Why? I could be wrong. Maybe the markets continue to go high. I don’t have a crystal ball, but providing that insurance helps. You guys know, we have a newsletter called Money Flow Trader. It’s run by Genia Turanova, that does this. And over the next two weeks, I’m going to provide a special discount for this product. I’m going to provide 40% off, and also I’m going to give you a second year absolutely free. Okay? It’s only going to be available to Curzio Research Members. So, this offer is not going out to anyone except for you. Okay. So the offer, we’ve never made before. It’s cheapest we’ve sold it.

Frank Curzio: I know that sounds like a sales pitch. I’m trying to get you to buy something. It’s not, because if you subscribe to the product and the product is shit and under-performs, you’re never going to buy anything from us again, and you know I’m in this for the long term, I’ve been in this industry the entire year. The reason why I’m pushing this is because you need to protect yourself. And when looking at the markets and you’re looking at this product, right, which buying puts, again, that insurance has been a terrible strategy as market hit new highs, right? For the past two, three years, right, since we launched this product. It’s set to have a banner year in 2022, because I’m going to predict a lot of triple digit winners. Why? Because, Genia logged seven triple digit winners when the market was crashing during COVID. Seven of them, one of them as highest 500%, and more than 500%. That’s what happens.

Frank Curzio: Imagine seeing those types of gains when the market’s crashing, and what does that do to your portfolio? Especially if it crashes even more, that small percentage could be worth more than your entire portfolio. Recently, we’ve seen crazy volatility. She just took two more gains, locked in two more 100% winners. So, if you’re not interested in Moneyflow Trader, no worries, it’s fine. You’re like, “Oh, Frank’s selling up,” or whatever. Do me a favor. Learn about buying puts as a way to protect yourself. You need to hedge your portfolio here and be smart. Okay? It’s a very easy strategy. Do this through your online brokerage account, but trust me, by doing this, you’re going to thank me. It’s going to let you sleep at night. And we are going to see crazy, crazy volatile conditions. And remember this term, it’s a fundamental shift, guys. We’re not talking about, “A market that’s expensive, that’s going to come down, and usually historically this has,” no, this is different.

Frank Curzio: The Fed is going to get very, very, very aggressive raising rates. Very aggressive raising rates. They have to. You saw Powell just throw in the towel, totally. Just the first time that I’ve seen them do that. It’s the first time I’ve seen the Fed make a massive change, that it wasn’t predicting and holding your hand months ahead, telling you that it was going to do it. Okay, when Powell had that meeting in late November, nobody, nobody thought he was like, “Listen, transitory is gone. We’re throwing that word out. And we’re going to start raising rates much, much sooner than expected.” That was a huge, huge surprise. You saw it in the market. That was a big surprise.

Frank Curzio: The Fed usually doesn’t do that. Usually doesn’t spook the markets like that, but that’s a sign telling you that these guys finally are nervous about inflation, which you saw the producer price index today. You saw the CPI, right, a couple weeks ago. They’re at the highest levels in history, both of them. CPI’s not at a 39-year high, just went over the numbers. If you’re using that apples to apples comparison, it’s at an all-time high in terms of prices going up year-over-year. And it’s much, much more than it’s being stated by the government.

Frank Curzio: Let’s take a couple of your questions. First one is from Mike. Says, “Frank,” after, he has CRUZ, but it’s going to be CURZ, C-U-R-Z is going to be the symbol of our token. He goes, “After that token is listed on tZERO, will you be publishing a performance update on a periodic basis like Aspen token? Is it going to be quarterly? Semi-annual would be great.” It’s probably going to be semi-annual at first. And then, we’ll do quarter as we build up, because it is a lot of work, and build up the IR department and different divisions and stuff. But yeah, for me, it’s always been about full transparency. Even if we’re not doing well, we’re going to report our numbers, right? So, we’ve been consistently growing, but that’s how I see this market. I see this, with security tokens replacing a lot of the stock market, especially when it comes to small caps, because, and over the counter names. I mean, the cost to do this is much, much cheaper, as you guys know. It’s a lot easier, a lot faster to come to the market.

Frank Curzio: You don’t need institutions. I don’t have institutions investing in my thing where they’re taking board seats, and they’re telling you exactly what to do. They’re all short-term holders. I mean, a lot of these investors are the worst ones. Their job is to make quick profits and get out as quick as possible. I mean, that’s not what we want. So for me, transparency is huge. And when people launch security tokens and they come to me and they say, “Hey, Frank,” and they show me the details, and I can’t find a lot of the things like their financials, or what’s going on, I really don’t deal with them. I’m like, “I can’t help you,” because it’s not doing this market justice. It’s not going to help it grow as fast as I think it’s capable of growing. So, you need real companies, real people, no money grabs like we see in utility tokens all the time.

Frank Curzio: Of course, there’s great names within there, within the crypto industry. But I would say for most of them, are garbage. I mean, you don’t even know who’s running the company. You don’t know how much money they still have in that balance sheet. You don’t know any of this stuff. They create this whole thing, this whole white paper, everything. “This is a utility function,” and it has no utility function. Which means the value… If the token has no utility function, it means that it should be worthless. It should be zero. Because the only thing that’s tied to that valuation, it’s not equity. It’s the use of the utility. So, when you’re looking at cryptos or anything else, I mean for me, security tokens, this is going to be massive. It’s starting, exciting. I have a great interview on Thursday with one of the heads of tZERO. So definitely pay attention, really, really good stuff. And you’re going to understand why it’s not just me that’s excited about this market, but why you’re going to see so many companies use this new way of going public, and disrupt the investment banking industry.

Frank Curzio: Let’s get to one more question here. And, it is from Joe. Says, “Frank, what are the best sectors to investing, going into 2022?” I like when people keep it simple. I like energy on this pullback. I really do. I mean, when you have companies forcing… Not companies, but investment firms that control most of the stock, forcing oil companies to stop drilling, it’s going to be, it means the prices are going to go a lot higher. I think prices will surge over a hundred dollars a barrel. Even at current levels, these companies are trading to a huge discount compared to three, four years ago, when oil prices were at similar levels, and you’re looking at their balance sheets are much more healthy. They cut costs tremendously. Now they’re seeing massive growth. You’re seeing, how many energy names have you seen not just reinstate their dividend, but of raising their dividends, and paying special dividends? That’s how much money they generate. All prices are through the roof.

Frank Curzio: So, I like energy on this pullback. Some of the gold medal, like high margin stocks because they have pricing power. So, a lot of those names on that list. I focus on names, major growth trends like EVs, ESG, Metaverse. And by the way, I’m going to the Consumer Electronics Show, first week in January. Pay close attention. I’m going to be doing live broadcasts through TikTok, and also posting a lot of this stuff on our website. But, pay close attention. I’ve been going to this thing for like nine, 10 years and innovation has been crap. It’s all been, “How do we enhance the current AI, and 5G, and streaming?” And we haven’t seen tons of innovation. It gets you excited. And we heard about EVs, but now it’s here. The EV market’s here. It’s not just Tesla. You’re going to see a lot of, more of these things on the road next year. Rivian got Car of the Year. They’re starting to deliver right now.

Frank Curzio: But, I’m going to be interviewing a lot of companies, a lot of these trends, looking into it. And this is where, this is the event where the most technologies go. Thousands of thousands, of the biggest technology companies in the world. They all go there to launch their product. This is what they’re going to launch over the next three to six months. They get all awards and everything. And having the access that we have, the media access, again, because of you, and podcasts, and influencers, and industry analysts, and stuff like that, we have access to almost everything and anyone we want, and which is really, really cool. So, we’re planning all those meetings now. So definitely pay attention, because we’ll find, trust me, I always do find diamonds in the rough.

Frank Curzio: 2019, last time I attended, I told you Kodak. I didn’t tell you why it was going to, why. But they had a major presence there, insiders were buying, technology was pretty cool. I wanted to look into it. And I said, “Guys, you just might want to put this on your radars as a speculated buy.” And I think it was like $2, and it went to 10, 11, 12, or something. And you always find good IDs here. You’re looking at more trends, crypto. I really love crypto, as you know. And crypto is, if you’re looking at crypto, forget about looking at Bitcoin every single day, and it goes down, and then you get to see Peter Thiel tweets, and it’s saying, “It’s worthless and it’s garbage.” And, when it goes higher, then you have all the bulls, and the Winklevoss twins, and stuff like that. And I get it, right? They’re putting their money where their mouth is, right? Forget about that in short term price movements. The biggest innovation is coming from crypto. It’s going to come out of crypto.

Frank Curzio: You’re looking at DeFi, still in its infancy. Security tokens starting to really, really take off. You look at NFTs, are on fire right now. Holy cow, they’re still on fire. People are like, “Oh, NFTs are fads.” It’s not a fad. NFTs are not a fad. Dow, you’re looking at the Metaverse. The Metaverse is going to flow through crypto. Look at the companies, not too difficult to find. I don’t want to give any away, because we have one of those names in our Crypto Intelligence portfolio, which is up several hundred percent, and several hundred percent over the past couple months. This is the opportunity that you’re seeing in crypto gains, that you can’t really get in the market. You have to be in the right areas. You’re going to see ups and downs. You got to be very careful. Don’t go all in on anything. If you’re going to invest, say, if you’re going to invest, a thousand dollars, invest $250 and then another $250 if it comes down a little bit, or whatever, but just scale into these names.

Frank Curzio: Because, we have names in our portfolio, the average gain is up over 850%. The average gain, talking about even with the losers in the portfolio. So, we’re looking at 20X returns on several of these, 30X returns, I think, on one or two of them, a lot of 10X returns. Those names, a lot of those names were down 20, 30% for us at one time. If you’re looking at 2018, 2019, so use that volatility to your advantage, because it’s here. It’s a two trillion market and institutions that are late to the party, they’re dying to get into this industry right now. And those institutions are dying, and this is going to be their opportunity to get in. I mean, you’re looking at the results and you’re looking at the numbers from like Silvergate and Galaxy. I mean, and the partnerships, that they’re signing with investment banks.

Frank Curzio: I mean, this is the early state. We’re still very, very early into crypto, but most of the innovation is going to come out of there, especially over the next decade or so. You have to be invested in this. You have to learn about it, take the hours and learn about it. It’s not that easy, but you’ll still be well ahead of the curve, as most people, believe it or not, are still not invested in crypto. I think it’s crazy. I made some of the biggest returns of my life in crypto over the past two, three years. Also, dividends should be huge next year. When you’re looking at conservative funds, trillions of dollars. They’re going to create defensive names that are raising their dividends. So you get some, I like Morgan Stanley, Devin, Alcoa, Newmont Mining, since they’re generating massive, massive cash, and gold over $1,700 ounce, I think by 2023.

Frank Curzio: I’m pretty sure it was Morgan Stanley, but don’t quote me on that. I think it was Morgan Stanley, has a $2200, a $2300 target on gold, which was interesting. But even at 1700, $1,600 an ounce, these guys, they were all in costs, are well under a thousand. And now with gold really depressed, they’re able to purchase some amazing products and projects at dirt cheap prices. But a nice dividend name there, Newmont, these guys are paying dividends, generating massive cash flow. Those are some of the names I like. So again, a lot there. A lot of names I threw at you. Going to go over some more forecasts next week, but you want to position yourself. You have to play a little bit of defense. Don’t get crazy. I don’t have a crystal ball. Like I said, I don’t know if the market’s going to go up 30% next year or not. I do know that there’s massive risks in the marketplace.

Frank Curzio: And you’re seeing that right now with a lot, a lot of stocks getting nailed, even a couple of ours in our portfolio, right? Want to pay attention to our stops. They’re getting nailed. And some of the ones that were down are getting hit hard because again, tax law selling. But even those leveraged names, some of those leveraged names that you’re used to hearing, the DraftKings, and Virgin Galatics, GameStop, AMC, all these crazy names where insiders are actually dumping their shares. AMC, the insiders are dumping like crazy. They’re almost done dumping all of their shares. You got to be careful. You got to be careful going into next year because the Fed’s going to be super aggressive, and it’s going to result in a lot of high risk names getting hit.

Frank Curzio: So guys, questions, comments, feel free to email me at frank@curzioresearch.com. It’s frank@curzioresearch.com. I really appreciate all the support. And I’ll see you guys tomorrow with my buddy, Daniel. Take care.

Announcer: Wall Street Unplugged is produced by Curzio Research, one of the most respected financial media companies in the industry. The information presented on Wall Street Unplugged is the opinion of its host and guests. You should not base your investment decisions solely on this broadcast. Remember, it’s your money and your responsibility.

Frank Curzio, founder and CEO of Curzio Research, is one of America’s most respected stock experts. His research is regularly featured on media outlets like CNBC’s Kudlow Report, The Call, CNN Radio, ABC News, and Fox Business News. His weekly Wall Street Unplugged podcast—ranked the No. 1 “most listened-to” financial podcast on iTunes—has been downloaded over 9 million times.
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