Wall Street Unplugged
Episode: 892May 11, 2022

80 stocks on my buy list

buy stock

We start today’s show by discussing hedge fund titan David Tepper’s recent call for a market bottom… Tepper’s known for making macro calls that turn out to be correct—is he right about the bottom?

We also highlight a few diamonds in the rough amid the market selloff… And I share 80 stocks trading at absurdly cheap valuations.

Finally, we explain why the Bitcoin selloff is healthy… and why the end of SPACs is great for individual investors.

Inside this episode:
  • David Tepper’s huge market call [1:49]
  • Solid companies to watch in this selloff [8:25]
  • 80 stocks trading at cheap valuations [14:00]
  • Will Bitcoin hold the $30,000 level? [19:02]
  • Why Bitcoin isn’t going anywhere [25:50]
  • Why SPACs fell apart [28:33]
Transcript

Wall Street Unplugged | 892

80 stocks on my buy list

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 Wednesday, May 11th. I’m Frank Curzio, host of the Wall Street Unplugged podcast, where I break that headlines and tell you what’s really moving these markets. So as always, on Wednesday, bringing in the awesomeness, the best, I don’t know, I’m just trying to hype this up as much as I can Daniel, because everything’s been so bad with the markets, but the one in only, what’s your name again?

Daniel Creech: Daniel Creech. You know, we need like a similar to a rain dance thing. We need a market rally dance or something, Frank. People are getting nervous out there, I know. And for right reason. Crazy, crazy things are happening. This shines the light on the gray area in finances. So, it’s hard to make sense of it, but we won’t make anything up, but we’ll do our best.

Frank Curzio: Look. The 10, 15% correction, I think was on the table. I felt like that was on the table. We’re down close to 30% on the NASDAQ. A 10% correction in the past few days is pretty insane, in the last few trading days. So, just to see where stocks are and the massive selloff and the leveraging taking place all at the same time, and a lot of that has to do with uncertainty. And I covered that, right? We want some kind of certainty. And I think we might have got it, Daniel. I think one of the things is when we look back at the credit crisis, what was the big event that people felt like, “Oh, shit.” Even when you invested in the banks to capitalize the banks, people they didn’t really know what was going on.

Frank Curzio: It was really when Buffet decided to make a big investment in Goldman Sachs, right? And he came on a lot saying, “Now’s a good time to invest.” You’re looking at one of the greatest investors ever. But one of the greatest investors now by, and I think he is the greatest investor, at least by my standard, is David Tepper. And David Tepper came in and said, “Look, I covered my short, I was short in NASDAQ.” This is the guy that told you in 2010 to buy everything. When they asked him “What’s going to go higher,” he goes “You know what’s going to go higher? Everything is going to go higher, because the fed is putting a bottom under the market, lower interest rates to zero, going to bail out, everything was covered.” And he was right. You could have bought anything and made money in 2000 late, 2010, 2011.

Frank Curzio: I think that’s what he said. And it really changed my perception of the markets, because I was like “Holy shit, this makes sense.” He was early to COVID too, I remember in January, early January, I actually wrote about this because I was interviewing people who were in lockdown in Italy and in China, and starting to say, “Holy shit, this is a big deal.” And I saw him on TV, I think it was in January, which was early, right? No one really thought in January that COVID was going to come here. And he said, “This could be a massive, massive risk to our market, and we need to pay attention.” And this is a guy that I look at, when we look at 13 F’s Daniel, I look at what he’s buying and selling, and he’s always seems when he’s selling, he was buying early with the FAANG names and selling them six months ago.

Frank Curzio: It’s just… The guy always seems ahead of the curve. He has a good pulse on the market. And now for him to say, “Listen, I think we’re pretty close to bottoming.” I think that… Listen, it’s one man’s opinion, but this is a guy who has a history of really, really putting his money where his mouth is, and making amazing market calls pretty close to where they are. And I think it’s a sign of confidence.

Frank Curzio: We see the markets go up a little bit on Tuesday, but then start pulling back, there’s nervousness, and look, we’re not going to catch absolute bottom, I just thought that was a positive. I really did. I thought that was a huge saying. And he talked at Kramer, he said, “Listen,” and Kramer came on and said, he covered his NASDAQ shore, he thinks we’re close to the bottom, which I don’t know if it’s so much of a bold call, since again, the NASDAQ’s down close 30% and the markets are getting crushed, but you know, I feel the same way. We were very, very close. We could go lower here, but it feels like a market where wow, there’s a lot of things you can really start picking at right now.

Daniel Creech: Absolutely. And to your point, it doesn’t mean that things can’t continue to go lower because there’s… Price discovery is exactly that, it’s just price discovery and things have to wash out or wash through the system. When I say things, I mean just the excessive liquidity and things like that we’ve been used to from a market perspective. This was great. I take these with… I always respect guys coming out and giving numbers and such, he thinks that the 12,000 I think, is going to hold, it bounces around that, but I take these polls, “Hey plus, or minus a few percent.”

Frank Curzio: That’s a NASDAQ?

Daniel Creech: I’m sorry. Yeah. NASDAQ.

Frank Curzio: Because we broke through it a little bit.

Daniel Creech: Yeah. Well yeah. So if 12 isn’t the exact print, but to his point, it’s great because… And this just puts a great spotlight, Frank, on the emotions and everything around investing. Because if your timeline is three years, you’re not near as worried about today. If your timeline is you need money at the end of this year or early next year or whatever, this real recent pullback is causing you to do a double take and think over every one of your positions, which you should do and is fine. I think the big takeaway here is what’s interesting about this is that, outside of numbers, and we were talking about this a little bit, yeah, the overall market has come down. The forward price to earnings ratio has come down.

Daniel Creech: Those are all positives. Yet, I’m not saying he thinks it’s clear sailing from here, but the big thing that’s different now, Frank, is that there is no… If the Fed sticks to what they say they’re going to do and stays aggressive, I know that you did a great job explaining why they messed up, taking the 75 or a higher interest rate hike off the table, if they stick to those guns, there’s nobody going to come out.

Daniel Creech: So to your point, don’t fight the Fed call he made back then, and see the exact opposite. But yet, I’m not saying he thinks we’re going to rally hard, I didn’t see the interviewer verse comments personally. I just saw some headlines. I’m going to look into that more because maybe we just bounce around and go sideways from here or just quit going down. I don’t want to put words in his mouth, but the other thing you have to, you and I talk about this all the time and investors have to pay attention, the thing that’s different now is, there is no come to the rescue and put the bottom in the market from the Fed standpoint, it’s going to have to be buyers and investors. That’s the big… Are we in agreeance on that? Because that’s still the unknown there.

Frank Curzio: Yeah. And I’m in agreeance with that. It should… When the Fed’s there and you have the ammo to do it, and this is one of the things which we preached right when they started, when we saw inflation and we saw that the Fed has to raise rates, the punch balls being taken away. It’s the biggest risk to the marketplace, which we’ve been saying for over five, six months now, and even much longer than that. It’s the biggest risk because the Fed can’t do anything other than take money out of the system. Which it has to force a recession, right? We’ve said that numerous times. The Fed has no choice but to force a recession, in order to control inflation, and inflation got well out of whack, they didn’t see it coming, whatever, regardless, that’s the past. So the future, now we’re down to levels that are pretty crazy.

Frank Curzio: And every risk we’re talking about, whether it’s inflation, whether it’s the Fed, whether it’s Russia and the war and China lockdowns, we’re talking about it a lot. And I would think with the market down as much as it is, that a lot of that is factored in. So, what’s it going to come down to? Fundamentals, right? And the Fed, when they raise enough and we see inflation moderate, and that could be six months from now, right? That’s when you see the Fed does have a little bit of ammo where they could lower rates to try to stimulate the economy, whatever, which would be easier once we see inflation moderate. Which we’re seeing across the board, we’re seeing across all these industries now, even housing, seeing home prices, not in certain places, it’s through the roof, but you’re seeing… With the prices going higher the cure for higher prices, higher prices, and basically you’re going to see, and you’re seeing it right now, where more inventory, right?

Frank Curzio: That was the big thing. There’s not enough inventory in the market. Now you see more inventory in the market, right? So you’re seeing it in used cars, three straight months. We are seeing in a decline in prices, which is a small decline, but you’re seeing it. So, even in other areas of the market that I’ve been covering… So, you’re seeing it a lot where it’s… Companies aren’t going to have the type of pricing power, they’re going continue to raise prices forever. However, this is going to be over the next six months is what companies could manage this the best, and that’s what we want to go to, right? Because right now, with the market really collapsing and losing that growth, multiple that we’re so used to having, which is well above 18 times, 19, 20 times forward earnings, it got to 23, 24, which is fine, because we were growing tremendously and straight to low. It’s not the case anymore. But now, we’re trading below 18, 17 times forward earnings.

Frank Curzio: And there’s a lot of stocks that are attractive right now, especially when you see the Apples, Google’s, Netflix, Meta, Amazon, Nvidia… These companies just in the past few training days, lost a trillion dollars in market cap, a trillion dollars in market cap. You know how much that is? It’s not funny, but it’s a trillion dollars. I’d say… I mean, we go around like trillions is nothing. Remember when billions was a big number, trillion… And it’s just past couple days. So now, you have a lot of companies that look attractive here and that’s what you want to look at, what companies are managing the best through supply chain concerns are growing and have come down and got punished with everybody else. And I think you can find a lot of names, right?

Daniel Creech: Oh, absolutely. And that’s the thing, this is just the gray area of investing. I mean, we don’t know market bottoms or what exactly stocks are going to do. Nobody has a crystal ball. And so you could point to Boise Cascade and housing, wood materials and things. We’ve talked about that a couple different times. They reported earnings. And if you have a chart, BCC is the… I don’t know if you’re showing your screen there, Frank, to put you on the spot, but it’s important to think and remember, as crazy as stocks can go down, good RX, Peloton and Upstart are down what? 30 to 60% today or yesterday, Frank?

Frank Curzio: 60… Yeah. Holy cow.

Daniel Creech: In a day.

Frank Curzio: Yeah, it got nailed. So yeah, a lot of these names that missed going down 20, 30%, like Peloton. Peloton, 30% was… It was below $10, right.? So, they warned so… And here’s a chart of Boy’s Cascade Company, which is… You look at the one year, it’s up 1%, year-to-date’s up 7.5%. It’s a company trading at a full P of five here, right? And just getting it done. But these are the companies you’re going to find bear market where a lot of this shit just gets unfairly punished. And there’s a lot of diamonds in the rough right now, right? Because more things going to get attractive, not everything. I wouldn’t be buying pellets on here, which still has a three and half billion dollar valuation.

Frank Curzio: Who’s reporting massive losses, who have recalls on their treadmill, they’re seeing subscriptions barely grow 1% year over year. And that’s their bread and butter, it’s still training over three and a half times sales. So, when I look at a company like that, I don’t see the bottom yet. I don’t see the bottom in a lot of the spat deals that we saw. But when we’re looking at this, there are lots of names that look attractive right here, which we can cover right now. I mean, that there are, one of the names that you just gave, so…

Daniel Creech: Yeah, and one other thing I wanted to point out for investors looking around because it’s typically you don’t want to do the easiest thing. If it’s easy, it’s not worth doing is an old fun saying. What’s the easiest thing to do right now with the markets, Frank? Turn it off.

Frank Curzio: Yeah.

Daniel Creech: Sell and turn it off. Like, hey, “Don’t look.” Hey, what are you down?” “I don’t know. I’m not going to look,” that’s not all bad actually at some point, but with Boise Cascade and for people looking when you have these massive washouts, because it doesn’t matter if you report great news or announce anything, when markets are acting like they have at the end of last week and the start of this week, everything’s going to get thrown out with the bathwater. Look at AutoZone. AZO stock has been pulled back as well.

Daniel Creech: But one thing you can look for, you can screen for, Boise Cascade has got a history of paying special dividends, because all the companies that were benefiting from this pull through and demand on, in this particular case, housing and people moving and things like that, and causing supply chain issues and price hikes across materials, look for companies that have paid special dividends in the past.

Daniel Creech: You’re going to figure out what management teams are really rewarding shareholders during rough times. And yes, and I’m not making excuses here, I’m not saying my positions aren’t down. It’s frustrating. It makes you scratch your head and wonder, “Why in the hell did I come work for Frank and do this?” There’s got to be a lot less stressful stuff we could do Frank. But kidding aside, who is actually… Markets go on. The sun’s going to come up tomorrow. So, that’s why you don’t want to get annihilated. You don’t want to have massive losses, and you can look and see who is rewarding shareholders because when it subsides a little bit, money… When you don’t have a Fed stepping in to bail out everybody in terms of liquidity and causing a whole rising tide to lift all boats, when buyers and individuals are going to be finding a market bottom and then reversing at some point, and don’t get too bearish, just because it’s easier to get bearish as things get worse, that’s just human nature.

Daniel Creech: You want to look for when those decisions are being made… Okay, now, without the Fed stepping in, people are going to pay a lot more closer attention to where they deploy their capital. And you want to focus on companies that are rewarding shareholders, either through special dividends, supplemental dividends, however they describe it. But Boise Cascade is one. AutoZone is another one I would put up there, not in terms of the special dividends as much, but just as the business plan, rewarding shareholders through share buybacks and things like that. When you have massive, great companies that have amazing results on returns on capital and things like that, getting sold off with everything else, that’s when you at least want to start nibbling away. And just use small position sizes. If you got to buy something now just scale in, because if this market’s taught you anything, you can add to a half a position in a week and be down another 25%. That’s the reality we’re in right now.

Frank Curzio: And when you add… When you start with a small position, you almost, you don’t, not that you don’t care if it goes down, but you’re going to be more pissed if it goes up, because you have such a small position, but if it goes down, it’s almost like you’re rooting for that because you’re able to buy more and lower your cost base at these levels. And I may be saying that for a lot of other stocks that are down and your lower, your lower, your lower, now you have full position. You’re still down 20% on it, but it’s much better than being down 70%, which seems like it’s crazy 70%, by the way I saw an interesting stat. In healthcare, the average stock in healthcare… Look, the average stock, I’m not cherry picking. The average stock is down 75% from their high, from the 52-week high, 75% in healthcare.

Frank Curzio: Obviously, that includes biotech as well. It’s got annihilated. Some of these names are still going to get funded and they have cash on a balance sheets again, a good place to look. Another name that I like is Mattel, just reported great results. They said, “Hey, we may be looking to sell ourselves now turnaround’s complete, 17 times forward earnings, which is a market multiple, little bit discount, grown like crazy, just so many catalysts just reported in the same quarter,” but people ask me, “Hey, what am I doing in this market? What should I do?” And like you said, Daniel, the easiest thing is to sell, but I’m going to bring something up right now, because I did a quick screen to see S&P 500 companies, and how many are trading below 10 times forward earnings right now.

Frank Curzio: And my screen, and I’ll bring it up, yielded over 80 companies. So 17%, about 17% are trading. So, if you’re on our YouTube page, I can go over, you can see a lot of these, but I’m just going to highlight any… Stop me because I know you know a lot of these names, Wells Fargo, Bristol Myers, Freeport, Fox Corporation, Truest Financial, Valero Energy, United Airlines, FedEx, Phillips 66, Chevron, Verizon, Seagate Technology, Skyworks, a lot of leaders, right? HP, MetLife, Delta, Exxon, State Street, Goldman, AT&T, Pfizer, Whirlpool. A lot of great names there that-

Daniel Creech: Sorry to interrupt. Did you say Exxon?

Frank Curzio: Exxon.

Daniel Creech: Exxon Mobil’s trading for under a 10?

Frank Curzio: Most energy companies are trading for-

Daniel Creech: See that. And if you look at their… That’s a good, sorry to interrupt you, but you pull up a stock, emotionally it’s going to be easy to not buy that because all you already missed it. But when you actually put the fundamentals over that, think about that. So, just like a stock can drop 80% and still be expensive, a stock can rise a hundred percent or double, and still be cheaper.

Frank Curzio: And those earnings, I mean, yeah. Those earnings are incredible. And now, what do you do, right? So I see these companies, what’s the next step now? So, when I look at this next step, I’m like, “Okay, what should we do here?” And when I look, I’m like, “Okay, well let me see how fast the earnings have grown.” Obviously, they’re going pretty fast to 10 size fold earnings, but do they pay a dividend? We have AVIXON, huge dividend, a lot of those companies do. Are you seeing insider buying? That’s important, right? Insiders are stepping up. I’m sure you could find it. It’s some insiders… And are they buying back stock? So, we put all these factors in, you probably get a list of five to 10 stocks with all those quality. And that is really, really attractive because I’m like, “Okay,” those are names that I could buy, that has all those qualities, has a dividend for a little bit of safety, has the buy back, okay, I have some buying coming in the market where it’s tough to get buying.

Frank Curzio: Again, that dividend’s more of a safety quality and you want to invest where you’re protecting yourself here. You don’t just want to say, “Okay, I’m investing in the highest growing stock, and hopefully the market comes back and they got to go up the most.” But you’re looking at has anything changed with agriculture and fertilizer companies? Absolutely not. Massive shortage, right? So, we’re seeing that. And we had Mosaic go down I saw 10, 12% from its highest. ALCOA, that market’s great. I understand China’s offline right now. But ALCOA, those numbers were fantastic. That stock was at 90, it went to 55, 60, we’re still up on it. We added to our position in our newsletter. And when I look at names like that, it’s always providing a chance for you right now.

Frank Curzio: It’s like, “Hey, I missed it.” Right? You want to buy the dip, and you don’t buy the dip, you miss it. Now, you’re seeing these stocks where if you miss it, you can almost be a little bit patient here too, and they’re going to come down along with the market when you have these conditions. But it’s hard to reverse that psychology because you want to see some kind of good sentiment, you’re not really seeing it, a lot of great names report, great earnings are down. Even Microsoft and Google by far reported the best earnings of the Fang names, and even those have gotten crushed. I understand why Amazon got crushed. I understand why Netflix got crushed. I get it. I understand Meta. But when I look at those two names at two quarters in a row, great, great numbers.

Frank Curzio: Wow. And they’re still getting nailed. So, there’s a lot of names out there that are getting nailed in this market as we de-leverage, I think we’re pretty close there. And this is a massive, massive, massive correction, but there’s a lot of good stuff out there. And remember, if you’re going to make money in this market, the people who make the most money invest in things when they’re cheaper. And look at a… 24-month time Horizon, think of Buffet, think of anybody, long-term investors.

Frank Curzio: They don’t invest when things are at the top of the market. They invest when things are very, very cheap. And right now, there’s a lot of cash on the sidelines. There’s private equity. The balance sheets are full of cash. When you look at S&P 500 companies, special large ones, where they’re going to be using it to buy back stock, raise their dividend. But also now, they can acquire a lot of these companies that are Upstart. Are you kidding me? Not that anyone’s going to acquire it. And I don’t know the fundamentals too much, but I’m looking at the stock… What was the trading at Daniel? Three? What, 300 and what?

Daniel Creech: I think it hit 400 actually, UPST is the symbol. I think it hit four. And then it’s just been… Because we highlighted it a couple times, never as a formal recommendation, but it was a huge player and it’s got, it’s a great idea. And it was actually, it is profitable. I don’t know about every year, but it’s quarterly, because it’s a fairly newer stock, but great idea. But it’s just got caught up in the high.

Frank Curzio: It was down 60%, yesterday.

Daniel Creech: Yeah, in a day.

Frank Curzio: 30, right? Holy shit. I mean, some of these names are just are getting whacked, but you have to be careful. Growth is not there anymore. We don’t have a growth environment. I know people are used to growth, and it was a growth environment for 12 straight years, growth of a value, killing it. And every value stock, even the value, you had to see growth in it. Now this is a value market with companies that are growing, but you need to see the value. You need to see these things being cheaper, generating cash flow, good earnings, good management teams, which is very, very important. And let’s see if we see that going forward, but man, holy cow. I mean, some of these names have gotten annihilated, but there are lots of ideas out there.

Frank Curzio: And for me, that’s you just a few places I’m looking at. Let’s turn page to Bitcoin. We’ve seen Bitcoin sell off along with the NASDAQ and it’s attached to NASDAQ right now. It’s a speculative asset. I think a lot of this 10% move lower caught everybody by surprise. Just that a 10% sell off in a market is a market correction, right? If you see that over a year, you’re like “Holy cow” or a few months. So yeah, when you see it over a three-day period, which is basically what the NASDAQ did, you’re like, “Holy shit.” And this is on top of a massive decline already, right? This is just capitulation, funds blowing up a lot of leverage coming out of the market. You saw Bitcoin, which is, look, there’s people leverage to Bitcoin and you have these people going to hold forever and stuff like that.

Frank Curzio: But you’re seeing that come down. I think that’s a fantastic investment, as it’s just being open to institutional investors for the very first time who are coming in, who are pouring in, who put a lot of money into building this infrastructure out and are we going to see decline? I don’t know what it’s going to be. I know it’s going to be a lot higher than the years ahead. But right now, for me, I’m using that as a buying opportunity, but it is linked to the NASDAQ as a speculative asset. And I’m going to be honest, I think this move in Bitcoin and overall crypto is very healthy. You’re looking at Bitcoin, Ethereum, good names, a lot of good names, even driving our portfolio, but you need to see a lot of this shit go away, Daniel. And 90% of this that I’ve researched is shit.

Frank Curzio: If you’re looking at PancakeSwap, if you look at Uniswap, those are good services. They have nothing. You’re looking at billions of dollars in valuation for these market caps for these… And the coin has no utility features at all. You don’t do anything with them, which is insane. They should be trading at zero, right? They have multi-billion dollar valuations, and when I’m looking at so many of these tokens and even some of the new guys that I speak to as well, who have projects, I’m like, “What’s the function of your token?” They’re like, “Well, we don’t need this or we have this value, or I have this property here in the Metaverse,” but that’s not accounted for. You need… If you have a utility token, the value is tied to the utility.

Frank Curzio: If there’s no utility, it’s fucking worthless. It’s zero. It should be trading at zero, right? And that’s why you’re going to see a lot of these things trade, and they’re going to come out the SEC and say that they’re going to trade a secure. They are securities, at 100% of securities. And when they do, you’re going to see Coinbase changes its business model, which they already have the license of security tokens, and the major crypto, which are trading there right now, which will be fine, which are utilities. And Gemini, and they have their licenses for this, but this… Look it’s 90% of that market is shit, while 10%’s going to be rewarded for becoming the next Microsoft’s, Google’s, Apple’s in the Web 3 revolution, which is ownership of your own content. Which is the way the internet should have been. You’re looking at security tokens, Defi, NFTs, play to earn gaming.

Frank Curzio: It is bringing all these incredible innovative trends together through the metaverse, an actual metaverse, which is not what Facebook’s doing. It’s not what Fortnite’s doing. It’s not what Roblox is doing. Those are gaming platforms, where most of money funnels into them. Those are not economies that are permission less, that are Defi, that are separate, where you could own all your own content, where you’re not giving away 50% of whatever you’re creating, right, to developers. Have to give away 50%, and that’s how Facebook has to make money.

Frank Curzio: A lot of these companies have to make money. That’s not the metaverse, guys. And I think that’s a big misconception. People are talking about, “That’s the metaverse,” it’s not the metaverse, Fortnite, Roblox, that’s not the metaverse. The metaverse is permission less. It’s Defi, it’s an economy. It’s bringing all this together. It’s a world where anyone could explore and go do what they want, create their own businesses and network. And man, this is the innovation that’s coming. This is the next generation, to see a lot of these names come down to where they are, even in crypto, is really exciting to me because a lot of it is bullshit, and I’m glad a lot of this is correcting right now.

Daniel Creech: Well, Frank put me in the crowd of this is like the parent saying, “This hurts more me more than it hurts you,” because I understand that it’s healthy big-term, but boy does it suck in the present, watching everything go down. And I know you’re not making excuses. You’re exactly right. I’m just trying to… Hey, if you don’t laugh at this kind of stuff, you’ll go insane. So… I agree with you on that because if you want to play some history here, a lot of people have tied this because if you look at a year-to-date to chart, the correlation between Bitcoin and the NASDAQ is basically hand in hand.

Daniel Creech: I think as of yesterday’s close, Bitcoin was actually down about 30% versus 25% on the NASDAQ, give or take a few percentage points. So, it’s being traded like a tech stock, which the bearers can point to and say, “There’s no store of value there, it’s just a volatile asset. It’s not money, blah, blah, blah, blah.” To your point in showing with past and to tie this in, if it’s like the NASDAQ crash, people say, “Oh, well in 2000, it peaked, and then took 15 years for the NASDAQ to get back to all-time highs.” That’s true. I don’t expect the Bitcoin to trade along with NASDAQ hand in hand because I think in the early days, and remember Bitcoin’s still early, relatively speaking, it’s not a stretch to see tech guys, the tech behind blockchain and all that attract those type of investors, tied into leverage and all that kind of stuff.

Daniel Creech: I agree because, as Tom Petty saying, the late great Tom Petty, “Waiting is the hardest part.” Do you think Bitcoin’s going back to its previous all-time high of one time at 20,000 Frank? Do you think the new range is… Because remember was it 2017? It hit 20. And over the next year and a half, what it dropped down to under five? I think it hit three and change.

Frank Curzio: I think it hit three and change, yes.

Daniel Creech: So massive, massive sell off. Well, our recent highs are what? 67,000-ish last November? Now, do I think 5,000 is in the cards? No, I honestly don’t. But do I think 25,000 is? Obviously, that’s easy to say when it’s at 30 now, give or take. But that’s what I want to see on the new normal. Where is that new range? And that’s why CEO of Galaxy Digital Holdings, we’ve talked about many times Mike Novogratz, he thinks it’s range bound between that 30 and 50.

Daniel Creech: And he was pretty sobering last week on CNBC saying, “Listen, it’s going to be a stagflation market. A lot of leverage are going to come out. It’s going to be a grind for the next several quarters.” Well, that’s through the end of the year at least, several quarters. Okay, but what if Bitcoin ends the year at 30,000? Yeah, you’re going to see a lot of headlines say, “Hey, the majority,” whatever the hell that means on their timeframe Frank, a lot of people are underwater. MicroStrategy might be close to being underwater on its Bitcoin purchases. The public company-

Frank Curzio: They are.

Daniel Creech: Oh they are now? Officially?

Frank Curzio: MicroStrategy. I think it’s like 36-ish.

Daniel Creech: Now? Is Michael Saylor going to start selling Bitcoin? Do you think?

Frank Curzio: No.

Daniel Creech: I don’t think so.

Frank Curzio: He’s going to end up buying more.

Daniel Creech: And maybe those tweets along with David Tepper’s comments about the overall market, you’re going to need some bigger players to step up for that attitude to change, but all in all, it is good. As hard as that says, because you want the bad to wash out, because again, capital in huge, huge numbers from Wall Street to individual investors globally, is still interested in looking to flow into this space. That’s not changing just because prices are dropping. In fact, that may accelerate some money on the sidelines. I’m not making excuses saying it’s easy, but unless the world ends people, you can’t panic, and the world’s not ending. And even if it did, it wouldn’t matter anyway, Frank, so there’s a little bit of optimism there for you.

Frank Curzio: And you have the thing too, in terms of crypto, what’s a thesis behind it? And it’s more stronger than it’s ever been right? It’s anti-government. We’ve seen in the political cycles of how much control that these large internet companies have of what you can see and what you can’t see, especially if you’re conservative, you’re definitely saw it. But it’s… Just being able to own a lot of this content and putting what you want in front of you, not only that, they own the content, they can kick you off whenever they want. But you’re looking at central governments themselves spending money and you have no control of how they’re spending your tax dollars, right? It’s just insane the amount of money where there’s no accountability, their priority, which we’re all able to see through social media now and videos, we see the flip flopping back and forth for both parties and how crazy it is.

Frank Curzio: And you know, how the media is just… I mean, the bias is unbelievable. It would be nice to get news just that’s right down the middle. That’s really reporting news without a bias. And even shows that you watch on TV have a bias, right? Even the law and orders and defund the police, they got to defund the police, and the immigrants and stuff like that through Chicago Fire and all this stuff. So, depending on what channel you want, you see that bent. And I think people are just freaking sick of it. And how do you get away from that? And Bitcoin is one way to get away from that, right? So, just centralized and getting away from that central government is more stronger than ever.

Frank Curzio: And we’re seeing it from country to country, seeing the US and that’s the younger generation, right? That’s Gen Z. That’s what they want to see, right? So Millennials, Gen Z. But that thesis is stronger than it’s ever been. And that’s not going away anytime soon. So, Bitcoin’s here to stay. Again, it is a risky asset. We’ve always been clear it’s a risky asset, but the innovation, the major innovations that are taking place, the next generation of the internet, there’s a reason why all these firms are coming out and saying web three is unbelievable, where you’re owning your own content, permission less, decentralized. That’s the way the internet was meant to be, not owned by select few companies. And that’s why you’re seeing those select few companies go all in on things like the metaverse and crypto right now, because they know that’s infringing on their territory, that’s threatening their business models.

Frank Curzio: And you’re going to see that going forward across almost every single industry. So how long it takes, how long it takes, but it’s here. It’s not going away. You could see it. And the amount of money flowing into this industry, whether it’s a metaverse or through crypto is unbelievable, considering how bad the market conditions are and how terrible it is. There is money still flowing into crypto ideas that are really good ideas, which you’re not really seeing in SPACs where I think, what did they say? Goldman Sachs is dead, right? Goldman Sachs said, “We’re not doing SPACs anymore, investing in SPACs.” So…

Daniel Creech: Yeah, don’t be bashing Goldman Sachs, bash everybody else. We like Goldman, they’re in our portfolio remember?

Frank Curzio: They’re in our portfolio.

Daniel Creech: We like to make fun of them, but only because they make us look so good because we said, “Hey.”

Frank Curzio: So, they got word basically from SEC that, listen, we’re coming after SPACs, and they’re going to get fined. If I had to guess maybe $25 million, and it’s going to be headline news after making like several billion.

Daniel Creech: I shouldn’t do this.

Frank Curzio: It’s like they did during the technology, the tech bubble. It’s amazing how these guys are that brilliant. And look, hey, we’re fine. They know how much they’re going to pay when this shit comes down of the not providing any statistics, any of the details, and just having these big insiders owning stock at a dollar to $3, dumping the shit out of it in everyone’s face, they’re up, they’re gone. And now, everyone else has left home, the bag getting crushed. And then again, it’s all political stage. SEC, and FTC, whoever goes after them, justice department’s going to say, “Okay, well here’s the fine and we have you back.” Yeah, right. And then yeah, they made their profits, they pay them and everything’s cool. And everything goes… It’s just funny the way the system works. But again, that’s the case to own fucking Bitcoin, right? That’s the case on Bitcoin. And that is the system.

Daniel Creech: And Goldman.

Frank Curzio: And Goldman, because Goldman’s ahead of it, right? Everybody else going to get fined, you’re not going to hear about it. Goldman sees it coming and says, “We’re out of SPACs now, we’re not going to do it anymore,” and just why’d you do in the first place? “Well, the fees were great.” Oh, I can’t say that, but just…

Daniel Creech: You know, what’s crazy?

Frank Curzio: It’s incredible, this is funny.

Daniel Creech: What caught my eye on that headline? So, this is from May 9th through Bloomberg reported, and it’s one thing to step away from SPACs in general. It’s another thing to do this. Goldman Sachs plans to stop working with most SPACs it took public, as the company seeks to distance itself from liability, regulators, according to Bloomberg. Frank that’s like saying, “Hey, I’m going to hire you, and you’re helping me out,” and then all of a sudden afterwards going, “You know what? I don’t want to help you out anymore. So, whatever we had and deal.” So…

Daniel Creech: So, they know they’re going to need new funding. I mean, I don’t want to hand this all too quickly, somebody’s going to walk off the limb, because we’re getting into a little speculation there, but that headline says it all. The ones that they actually took public, for your point, fees, deals and all that kind of stuff, now they’re going to step it’s very low hanging fruit, not a big connecting of the dots to say, yeah, they’re probably expecting to pay, so we’ll have some fun. We need to timestamp this. Look forward over the coming quarters. We’ll see about what fines, big banks have paid related to SPACs. If it’s like history, typically you pay about 30% or less in fines of what you’ve made, I think. Which is why it’s a rinse and repeat model, Frank, we ought to look into that. But…

Frank Curzio: No, absolutely. Absolutely. So anyway, it is what it is guys. But definitely take a look at that article. I just say that… SPAC market is dead, and they’re like, “Well, we’re not going to do SPACs anymore.” And how much money did you generate off SPACs? And just the guys like Chamath that I told you with Branson, the amount of money they made, and now these reports that they’re running out of cash when you’re looking at Virgin Galactic. And man, I just… I have to look real quick before we end this, just to see where that is. Where is Virgin Galactic? Because these guys are selling.

Daniel Creech: Oh, one of Frank’s favorite whipping boys.

Frank Curzio: It’s now five bucks. Good job. All those guys got a dollar sold at 32, 33, hundreds of millions of dollars, and it’s at five. But everybody’s going to space.

Daniel Creech: What was it? Seven months ago, give or take?

Frank Curzio: So, let’s see. So, I got a one year job in November. It was 20. And then it was… What was it? 450 in about…

Daniel Creech: Hey, if you like it at 50, you got to love it down here at five. Think of how many more shares you can buy.

Frank Curzio: So it’s 50 volume, 32 billion. This was when they would dumping the crap out of it in the thirties too, and then boom, you see your truck just go straight down. So, I mean, at the end of the day down 60%, but it is what it is, and that was allowed, and that’s cool, and they took advantage because people allowed them to take advantage. So, you got to do your homework on a lot of this stuff, where you don’t know the structure, you don’t know the warrants, and Wall Street jumped all over this because their job is to make as much money in the quickest amount of time. And when you’re looking at private deals, the average holding is seven to 10 years and that’s a pain in the ass, so let’s not do that. Security tokens provide a way to trade some of these private securities like ours in the market.

Frank Curzio: And that’s why you’ve seen some of these platforms develop, but that was a great alternative. Hey, we could start this thing within two to three, four months, and sometimes right off the bat, we could sell these. We could issue each other warrants. Nobody even knows what dilution is, or how many warrants or whether exercise because we don’t have to disclose any of that shit. So less disclosure, we get out of these things, we’re in and out like Chamath, and getting into the next one, which is great. And everyone else getting killed. Look, it’s there for the taking. They’re going to take it every single time. That’s Wall Street’s job, to take every single penny, and I always use the analogy, “Listen, if you’re on the street and they took everything from you, have a sock on you, they’re going to take your sock. They’re take in everything. They’ll leave you naked on the street and say too bad.”

Frank Curzio: That’s Wall Street. That’s Wall Street. It’s cutthroat. Believe me, I worked there. It’s more cutthroat than anything you’ll ever see other than politics, and holy shit. But that’s why you got to be careful, and I think that’s why some, a lot of people like to listen to this podcast because we’re independent. We’re not tied to any of these guys and we’re going to tell you exactly how it is, right? We don’t have an agenda and supporting an agenda, and Daniel has his own opinion, I have my own opinion, that’s always the way it’s going to be. So… But it is crazy and is sad the way that the market works sometimes.

Daniel Creech: Yeah, absolutely. But we’ll continue to break it down. So, let me plug like, share, subscribe, whatever you got to do to keep us afloat.

Frank Curzio: Yeah, I hear Dan. All right guys, that’s it for us, out of time. To me, questions, comments, for our email frank@curzioresearch.com. Daniel, email address?

Daniel Creech: Daniel@curzioresearch.com.

Frank Curzio: It’s so easy, I love it. And I will see you guys tomorrow. Real quick note though, be sure to listen to tomorrow’s interview with Genia Turanova, who probably has the best track record of any single product. Anybody in our entire industry will break that down. Again, we’re going to show you why it’s important and how to purchase long dated puts, which she has made a killing on in her portfolio, which I’ve impounded the table on too, in the last at least six to nine months, but we’ll go over whole education thing. It’s going to be a fantastic interview. It’s not like a cheerleader where we were like, “Hey, look at what she did away.” It’s education. I want to teach you guys how to protect yourself, because it’s still going to be a crazy market, while also being able to pick away at good names. Great, great interview. And I’ll see you guys tomorrow. 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 decision 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.

Editor’s note:

On tomorrow’s episode, in-house editor Genia Turanova will explain her strategy for limiting risk—and profiting—during a downturn…

Just this morning, she locked in nearly 100% gains in less than four months… Her 8th winning trade in 2022 using this strategy.

But you don’t need to wait for tomorrow’s episode to learn her secret…

Here’s how she does it.

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