Wall Street Unplugged
Episode: 885April 26, 2022

Adapt to this trend—or die

social media building blocks

Twitter has accepted Elon Musk’s offer to buy the company and take it private. I highlight the real (political) story behind the buyout… how this will negatively affect other social media companies… and how to profit in the sector.

I also break down the scary inflation data I’m seeing right now… why you need to pay attention to earnings this season…  and why it’s critical to prepare for the largest online trend in the past 30 years.

I explain why I love the Moneyflow Trader strategy for this environment.

Inside this episode:
  • Why you should pay attention to Q1 earnings [0:20]
  • Why Moneyflow Trader is the perfect strategy for this market [8:00]
  • Why you need to sell social media companies right now [13:08]
  • Money is pouring into a brand-new sector [16:20]
  • Why I’m pounding the table on inflation data [22:50]
  • Adapt to this trend—or die [29:00]
  • Why Moneyflow Trader is the perfect strategy for this market [8:00]
Transcript

Wall Street Unplugged | 885

Adapt to this trend—or die

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: What’s going on out there? It’s Tuesday, April 26th. I’m Frank Curzio, host of the Wall Street Unplugged podcast, where I break the headlines and tell you what’s really moving these markets. So, we’re entering the heart of earnings season, which you guys should be paying close attention to and already you’re seeing inflation is a massive concern and very difficult for a lot of companies to gauge. Is it going to continue? Which is a big deal when you’re forecasting, because not only do you come out with earnings and nothing really matters about the last three months, that’s what earnings are. It’s about the future. You could miss earnings, and if you raise estimates considerably for next quarter, your stock’s going to go up. Where if the opposite, you could blow out earnings and the future, you say, “Well, we’re going to come in 10%, 20% short.” Your stock’s going to get nailed, especially in this market, where there’s no forgiveness anymore. Can’t get away with stuff like Netflix, two quarters in a row for a growth company, goodbye.

Frank Curzio: But you’re seeing these companies talk about inflation. We have Pepsi, Coca-Cola reported, are able to pass on these costs to consumers, which you all know since you go into restaurants and you’re paying $3.50 for a cup of soda, because these restaurants are able to pass on those costs. So Pepsi, Coke, they’re doing fine. They’re perfectly fine. It is amazing though. It’s like $3, $4 sometimes for sodas. It’s incredible to the point where I got to start bringing my own water soon, but it’s like, hey… It does. I mean, when you have kids, it’s $12 really, for four sodas. It’s crazy. It’s not a big deal, but when everything else is raising, you’re paying maybe $30, $40 for a meal. Now you’re paying $60, $70, $75; you’re like, “Holy shit.” There’s a lot of people out there. It’s a lot of money. But those are some of the companies that were able to pass off their costs.

Frank Curzio: Now you look at GE, not so much, not so fortunate. I think you’ll see the same thing happen with automakers. GM reports after the close today and Ford, as well. A lot of companies are reporting, but this is what you have to listen to, because you can see what companies have pricing power, but more importantly, all companies have pricing power the last couple quarters as inflation was rising. Now inflation continues to rise, however, it’s a different environment. People are not spending as much. They’re getting murdered in the stock market. They just paid massive taxes for last year, which is due on April 15th, which forced even more selling because a lot of them sold their stocks to pay that. Again, that’s if you invested from January through November last year, plan on pretty good gains.

Frank Curzio: If you invested from November, not so much, because that’s when the market really came down, started to come down. It’s a different environment. Everything, the cost of everything, you’re even seeing it hit mining sectors now and gold sectors where they’re saying cost of inflation. Tires are massive. Those massive tires, no idea how much they cost. Huge, and those tires are twice, three times the size of me. I’ve seen them up close, it’s unbelievable. Labor, energy, gas, fuel, everything going through the roof and these companies that have to pay higher salaries for these people.

Frank Curzio: It’s not easy getting talent, getting people that know your industry, which is in the oil industry. I mean it’s not easy. That’s a huge learning curve where you used to say, “Hey, we need some workers, come over here.” It’s not a fast food restaurant where you could teach someone in a couple months, maybe a couple weeks. It’s a lot different than some of these other industries.

Frank Curzio: So, pay close attention to what these companies are saying, because a lot of them are going to be lying to you, like I told you Ford and GM were lying to you about supply chain issues and how they’re not such a big deal anymore. That was 18 months ago, they said that. “Hey, we’re seeing the end of it.” No, you’re not. Singapore’s closed again. Good luck. Still seeing supply chain concerns on all the data that I track and these guys have been dead on accurate because they’ve been doing this for 25 years. They track it a week-by-week basis. It’s IHS market, even Goldman talking about the bottlenecks, they rate it on the scale. It’s still really bad out there, really bad.

Frank Curzio: So, let’s see what these companies, not what they’re going to report, but what they’re going to, over the past three months, but what are they going to say in the future? Because how do you provide guidance in this type of market? When the Fed is supposed to be raising interest rates considerably, and still hasn’t done so. With all this inflation, it’s supposed to be moderating? Even if it moderates, you have to understand guys, if we moderate inflation, just hold steady here and next year it’s at the same levels. It’s going to say, “Hey, inflation is up 0% year-over-year.” You’re still paying 60% higher than what you paid two years ago, if you look at it.

Frank Curzio: So, it doesn’t mean that the price of a soda is going to go down, oh, it’s $4 and inflation’s not going any higher so it’s going to be $2. No, it’s still going to be at that price. And hopefully, we see energy prices are coming down a little bit, but a lot of the good sectors, I mean this market is really hard to invest in, very hard to invest in. Because even if things that are working are starting to get hit now. How do you look long term when there’s so many uncertainties and usually war is a massive uncertainty. That’s a tiny uncertainty right now compared to everything else. Where’s inflation going? How much are we going to raise?

Frank Curzio: China was supposed to be the growth engine of the world. Massive stimulus package, which are usually in the form of lower taxes or tax rebates. But the last two months, they saw inflation start surging as well after coming down, or after moderating. Now, you have to throw in the lockdowns and the craziness over COVID. Can’t believe it. I mean, it originates there in China, COVID originates there. Wind up killing millions and millions of people. But when it comes to their own country, they lock it down just like they did. They lock down Wuhan and said, “No one go out of Wuhan.” You could go from Wuhan to every other country, which spread all over the world, killing millions of people, but you’re not going anywhere in China. You got to love China. It’s awesome. Again, it is the government. I talk about people. I love China. I’ve been there. People are great. And talking about just the control of their government and how crazy it is, it’s insane right now. That’s another story.

Frank Curzio: But looking at earnings guys, pay close attention because you got energy, lots of Dow components, tech, healthcare, all reporting this week. This is one of the biggest weeks. Boeing, CME, Seagate, HESS, Qualcomm, Eli Lily, McDonald’s, Northrop. And then, you have all the major technology companies, Apple, Intel, Amazon, Meta, Microsoft. They have Visa, Sketchers, Wyndham Resorts. We get D.R Horton today, which their stock went up a little bit because it’s got hit so hard, but they lowered their numbers. Let’s see the whole building front, how it’s impacting, which interest rates are considerably higher. I never thought they’d go that high that fast, mortgage rates, but they have. They’re over 5% now and they were 3%, four months ago, four and a half months ago.

Frank Curzio: You’re looking at GM reporting after the close. Not sure if Microsoft reports after the close and Visa after the close today, when you get this. Pay attention, especially to Visa. You want to see the spending habits. Are they changing? If they are, lookout. You have to look out. Because we haven’t seen that. We really haven’t seen that too much with the consumer saying, “Okay, it’s time for me to worry. It’s time for me to close my wallet.” We haven’t really seen it. We’re starting to see it and I’m starting to see the foundations crack. And that’s why I had that big, special briefing because the research advisory and that was about three weeks ago, because we saw demand starting to tail off for the first time.

Frank Curzio: We always had massively strong demand, which leads to supply chain issues. Now you’re seeing it in transportation, in deliveries. Let’s see what retail is going to say, but are people closing their wallets, because if they are that’s when you have to watch out because, yes, a lot of you getting killed. I’ve lost money on a lot of my personal positions, the market’s out of control. It’s crazy.

Frank Curzio: Leverage is coming out of the market. So I said, if you can, learn everything you can about buying puts. We have a newsletter that does that specifically. And we have one of the best in the world doing that for us, Genia Turanova, been pushing that for six months now. Hopefully, that took us up on it because it protected your portfolio and man, those things on it, just protecting your portfolio, a lot of those positions of 3X, 4X, 5X, which is cool. Let’s see how this plays out.

Frank Curzio: With all that said, earning season, big week. The biggest story this week, again, is Twitter. Just like it was last week. Elon Musk is now the proud owner of Twitter at the board under pressure from the shareholders, which is not really them, they’re not really shareholders, they own a little bit of shares, accepted his $44B buyout for social media company, finally. And I don’t know if that was under pressure where you had conservative politicians say, “We want to see all the emails, correspondence that’s going on between them.” Because I’m sure there’s crazy stuff going on saying, “We don’t want him to buy.” I mean, if it’s about the shareholders and I covered this, this is the craziness of the story. You ignore all the bullshit and the politicians. He provided an offer that stocks up 50% since he first started buying shares. It’s a great offer for shareholders, for the board not to accept this for political reasons is fricking insane. It’s insane. And that damages our entire publicly traded market, which is very dangerous for anyone who buys stocks. All of us are equity owners. Most of you listen to us are equity owners, that why you listen to this podcast. That’s a big deal.

Frank Curzio: When the board is getting a fantastic offer in a market where tech is getting destroyed, nobody wants tech higher interest rates. Everyone’s selling off offering a massive premium and they don’t want to accept the bid because they’re under pressure from the higher ups and the politicians and shit like that. That’s crazy. That’s crazy when you think about it. Makes you not want to own stocks.

Frank Curzio: Elon Musk sent a tweet, “Free speech is the bedrock of a functioning democracy. And Twitter is the digital town square where matters vital to the future of humanity are debated. I also want to make Twitter better for everybody, enhancing their product with new features, making the algorithms open source to increased trust, feeding the spam bots and authenticating all humans. So, it has tremendous potential. I look forward to working with the company and the community of users to unlock it.” Now as the bid got accepted, which was basically over the weekend, you saw liberal papers come out and I’m going to get on the conservatives as well, so hear me out, because Washington Post, many are left, trashing the deal saying how China could have leverage over Elon.

Frank Curzio: And what is said on Twitter, since Tesla does allow their business in China, it’s actually the second biggest market, which I think is funny. So they think Elon Musk, richest person in the world by far, over $200 billion, is in cahoots with China because this way they get more exposure, whatever it is. It’s just nonsense. They’ll say you should tax the rich. There’s a reason why you need to tax the rich even more. I can’t believe they haven’t labeled Musk a racist yet. Oh wait. They actually did do that, the LA Times and MSNBC. The LA Times, it was great. They said that Musk taking over Twitter is the beginning of the end for Black Twitter. I’m recording for Black Twitter, saying that Twitter gave millions of Black people, a megaphone voice to complain about racism.

Frank Curzio: Well, to those who, you still have the platform for that. The only difference is that people will be able to debate you now without fearing they’ll get thrown off social media platforms. So, I can see why you’re complaining because it’s nice to have an argument and have no one else complain where you don’t care about the facts or anything else, which is fine. Then you look at conservatives, and they’re super happy. They have a platform that supports their agenda now. It’s free speech, but again, conservatives want something that’s going to support their agenda. That’s what it is, it’s all about power.

Frank Curzio: It’s all about power, and you’re seeing it right now. Everyone’s seeing it. It’s on full display for both parties to see that the person that you hired that’s supposed to represent you does not give a shit about you. They give a shit about themselves. We’ve seen it through COVID, we’re seeing it now, and Twitter’s a great example of this. This is an offer regardless of politics, that should have been taken immediately. And yet they put in a poison pill. Now they have politicians on. They’re going to see all the emails they’re like, “Okay, whoa, whoa, let’s just accept this offer.” Not because it was good for shareholders because we don’t want to get into trouble. We don’t want to see our emails with liberals or whoever, or conservatives, whatever that are influencing, whether we should decide to accept this offer or not, basically fucking the shareholders, which is great. But you got to love the politics.

Frank Curzio: Like I said last week, it’s all bullshit. If you want to get caught up in it, it’s fine. Feel free to post your thoughts on Twitter, other social media platforms, even protest in front of Twitter’s headquarters, hold up a sign and stay there for three days if you want and camp out. That’s your choice as investors. That’s why you’re listening to this, as investors.

Frank Curzio: If you’re trying to provide a better life for your families, investing in stocks and assets, you should be asking yourself, how do I make money off of what’s going on with Twitter? Well, how do I make money from all this bullshit, since strong feelings and sentiment, which you’re seeing on both sides usually result more volatility in certain stocks and sectors that pertain to that particular topic. So for me, when I ask myself that question, here’s what I come up with. A little bit different that anything you’re going to hear out there. Social media from an investment standpoint is dead. It’s dead. I would show up Meta, Snapchat, most social media platforms outside TikTok. TikTok’s not public, but it’s taking business away from everybody. And why am I saying that? Because they’re going more legit. That sounds crazy. But hear me out for a minute, because going more legit is a cool thing for users. Free speech, less bots, authenticating all humans. We all want that. At least most of us want that, 10% of left, 10% of the right. We’re not talking about those people who are crazy. But we all want that.

Frank Curzio: We all want more stringent privacy policies in place, which reduce how much these sites could track you, which not long ago, they were able to basically sit on your couch in your living room and watch everything every family member did, when they were going to do it. I mean, it was insane, which they had access to everything. Because you had your phone on you, track you, every single thing, those privacy, they’d monitor anything. Well it’s not the case anymore. Apple updated its privacy policies and despite how much power these social media companies have, it’s all through an app which Apple basically controls. And yes, Google has some control, but not as much as Apple. More than 50% of the US population have an iPhone. Not only that, those who do have an iPhone make more than $80,000 a year, according to Comscore, which is a 40% increase. That’s 40% higher than the median income in the US.

Frank Curzio: In short, these are the people company’s love to advertise to. They have a lot of money, and they buy a lot of shit. So, these new restrictions that Apple put in place resulted in a much lower return on ad spend. It’s companies weren’t able to track every single thing people were doing every minute of the day. No, you weren’t allowed to do that anymore. So now companies are like, “Wow, I was spending a million dollars and I was making a fortune off of this thing.” Maybe by day 30, I was making 80%, 90%, which means scale of out of it because long-term, those numbers are even higher. These things we do, we’re all in their businesses and all advertising, you return on ad spend. Now it’s taken away and what happens? You see Facebook warn their numbers are terrible. And many others who rely on ad revenue from their apps reported significantly decline in revenue.

Frank Curzio: So again, free speech, less bots, making sure there are fewer fake accounts promoting agenda and less tracking all cool things for us, or people who use the platforms. However, this is terrible news for investors because profits are going to shrink considerably. That’s how you should be looking at this. Now, who benefits from this? That’s what good investors ask themself. And here’s the answer? It’s the Metaverse. It’s Web 3.0. I read an interesting piece from Jefferies from yesterday, very big firm. And they interviewed Yat Siu, hopefully I’m not destroying that name, S-I-U. It’s co-founder executive chairman of Animoca Brands. Remember that name, if you haven’t heard of it already. It’s basically an investment company valued at $5.8B now, private. They invested in over 170 blockchain related companies with a focus on decentralized apps, gaming, NFTs, and the open metaverse.

Frank Curzio: So this guy who has been investing in technology gaming for over 30 years, worked at Atari Germany. Who knows Atari Germany, but just saying the word Atari most… If you’re under 35, you probably haven’t heard of Atari. That was a greatest invention ever for us older generation. That was an introduction to games for most of us, but that was in 1990. But one of the smartest people you find in the industry and the interview was fascinating. I loved the interview because it wasn’t this huge fluff piece.

Frank Curzio: This is a guy that’s investing, 170 different companies within blockchain, everything, that he’s putting all his money in. So the best contacts… But he highlights that currently there are only 200, 300 many people that involved in cryptocurrencies, less than 20 million people who actually own an NFT. Whereas the internet today, there’s close to 5B people using it. So, we highlight how the centralized nature of Web 3.0 and digital assets in the form of NFTs will disrupt, hear me out guys, almost all existing internet business models as we go from a rental internet to ownership, meaning what we’re all doing right now, which wasn’t really the intention of the internet just happened that way. And laws are in place and politics are in place, but we all rent the internet right now. We don’t own it.

Frank Curzio: We have Facebook, Apple, Google, YouTube. They own all of your property that you post on the internet. I mean, they’re using our pictures, everything we post as their property to market to advertisers. If they want to remove us from the internet, they can. It’s like so many people got kicked off these social media platforms for stating things that were controversial 18 months ago, like Biden’s laptop data on Wes Marring, stats on how COVID has very little impact to people who are in shape under 40, especially children under 12, almost very little impact where the fluids will kill more people in COVID under 12 and people were reporting this and doctors were reporting this, that and you got kicked off the internet.

Frank Curzio: That was 18 months ago. They were controversial. Now they’re facts, and we’re reporting this stuff, but you actually got kicked off the internet for citing something that was factual. Think about that for a minute. That’s how much control they have. But you’ve got 3 million people following you on YouTube, and you’re making money and advertising dollars, you’re running your whole business on YouTube and Apple, Google has the right to just shut you down whenever they want. A person could sit there and be like, “You know what? I don’t like you,” and click a button and you’re gone. No questions asked and nothing you can do about it. I mean, the president got kicked off and there was nothing he could do about it with social media platform. There’s nothing you can do about it because they own it.

Frank Curzio: As for the timing for the Metaverse and Web 3.0 as we go from rental to ownership, Siu believes that the rate of adoption is going to be faster than the rate at which we adopted smartphones. This is the Metaverse already a trillion dollar industry and he believes inside of two years, we will see mass adoption. That’s not a long time. You say, “Wait a minute, how could it be a trillion dollar industry?” And I thought about that for a second. But when you take Meta, Oculus, Roblox, Fortnite, Axium, centralized software companies, gaming industry, and all sales, yeah, I see how you get there. But all of this coming together now in these virtual worlds, that’s where you’re getting the trillion dollar number from. How long or how big does he believe this market could be? He thinks it’s going to get tens of trillions of dollars in 24 months. And eventually, the hundreds of trillions, think of that for a minute, as the existing large internet plays will see their entire business models disrupted.

Frank Curzio: I mean, look what we’re seeing with Twitter right now. Free speech platforms. Look at Apple having control over Facebook and Snap. Almost every internet company that relies on an app to track its customers, again, which is almost every large consumer tech company, the markets are consumers, Apple has full control of that. Isn’t that crazy? And you’re saying trillions and trillions, that sounds like a crazy number. The largest tech companies that own the internet, Google, Facebook, Amazon, Microsoft, Apple have close to $9T in market cap. That’s right now, it was 12, 13 at one time. A lot of these names have come down. Then he talks about the current problems with Web 2.0, what we’re in now where our data can be deleted because it’s controlled, owned by data companies, where Facebook could delete our digital identity, our entire history, which means we don’t exist anymore in a digital world. So, that’s why he thinks every single thing can end up on a blockchain as an NFT.

Frank Curzio: You can’t think of NFTs as these crazy art pieces? And I understand a lot of its bullshit, but it gives you access. It gives you the right. If it’s subscription based that you’re making royalties off it. If you have music, instead of going to Apple and everyone taking a cut and whatever it is, 10%, 15% of the final number that you finally get. Imagine getting not just a ton of money up front, but every time somebody plays that it doesn’t go through Apple who collects a fee or this person or your agent, or everyone that collects fees, it goes directly to you. That’s happening right now, guys, right now.

Frank Curzio: So, you look at this piece and you say, “Well, it’s Jefferies $60B in assets in management,” just came out yesterday. But the Metaverse and 3.0, then you had Goldman, Morgan Stanley and Citi just publish their reports on the Metaverse value in the market between $8T and $13T. Collectively, these three guys have over $8T in assets of the management. If they truly believe the Metaverse will become an $8T plus market, where do you think they’re going to invest their clients’ money? No surprise, NFT Metaverse companies, which we’re seeing today where billions have been raised already the first few months of this year. I brought this up over the past couple of… Why am I trying? Just like when I was pounding into your head, I love to say that because I love to repeat myself and say it just like during COVID where, “Guys, you need to sit on the sidelines right now.” Couple weeks ago, special briefing saying market’s really terrible. It doesn’t do me any justice. I sell financial newsletters based on equities. It doesn’t do me any justice, but I’m telling you what the data is showing and what we’re seeing.

Frank Curzio: So, why is it so important to you and why am I pound table on this, just like I was telling you about protecting yourself and your portfolios and buying puts? I said that since November was a fundamental change in the marketplace, when the Fed did a 180 and said, “Wow, we’ll raise the rates very aggressively going forward,” because inflation is not all of a sudden transitory, which you told us for pretty close to 18 months before that. So, why is it so important for you to understand this is a massive shift taking place?

Frank Curzio: When the stock market over the past few years got to insane valuations, it was totally out of control. You have ESG companies, SPACs, growth companies being valued at whatever, $10B, $20B valuations while they generated a few million in sales doing these road shows. These SPACs got popular, not because it’s cool. It’s because the venture capitalists and the people who create these, it gives them a quicker way to exit their positions after they pump the shit out of them, to you. And then, they can get into the next deal. Where IPOs, your lockup is going to be a little bit longer. Not only that, the time a company IPOs could be anywhere from seven to 10 years. That’s the liquidity period. A SPAC liquidity period is two to three months, four months, maybe. Some of them right off the start. So, you have these guys investing in early stage companies able to pump up the valuations through every means necessary, social media, go on CBC, “We’re the greatest thing in the world. This is the growth we’re going to see over the next 10 years, we’re doing $3M in sales, but that’s going to be $50B in 10 years from now in a discounted cash flow model,” all this shit because it’s all free money in the system. That’s the market, that’s the stock market.

Frank Curzio: And now, look at it today. A lot of this shit is crashing. The Fed plans to raise rates by, I have no idea. I mean, whatever percentage over the next 12 to 18 months in terms of timing, could be 3% in six months. It could be 3% in 12 months or 3%, 18 months, but they have to raise a Fed fund rate. So, the 2% to 3% based on when the 10 year is. Doesn’t matter how they want to do it, since they are praying, absolutely praying, Powell’s probably actually praying saying, “Please, please inflation moderate, moderate.” Which is not going to moderate, because China’s closed. And you still have supply chain concerns and oil prices still relatively high even though they fell below a hundred, they’re still much higher. And we still have a war going on with agriculture. Getting back to the agriculture, but yet, let me pray it moderates. Doesn’t matter how much you pray. You have to get the 3%. You could do it sooner. You could do it later. You could do in two years. The longer you wait, the longer this is going to be dragged out. And the longer these companies are going to have incredibly uncertainty, because while you’re doing this, it means higher rates, less money flowing into innovative projects. It also means really tough conditions for private companies right now.

Frank Curzio: I just spoke to someone who’s really smart in this world telling me how valuations have come down incredibly. Remember, these are companies that raise money. They’ll do an A, C, then a series, A, B, C, D, E, F, whatever, before they go public, with SPACs that allow them go public a lot quicker. That’s off the table now, but these valuations of where they raise money and when they raise money are incredibly high to… Usually, you raise money at $30M, $50M, then it’s like $2B, $3B, $5B. And you’re going to come out like Rivian or Robert Hood at a $30B, $40B, $50B valuation. Then the stock crashes and everybody gets nailed, except for the insider who sold out.

Frank Curzio: We saw at Chamath with Virgin Galactic, sold out. He’s not in it anymore. Everyone’s going to space. Everything’s cool. Same with Branson, they made a ton of money off of it. Good for them. But if you look at the private markets right now, man, and valuations. Think about the valuations as these people came in the last rounds, these private companies have valued 30% less. So, they’re not IPOing anytime soon. Now they’re going to have that money locked up for a very long time. That means less liquidity into the marketplace. So instead, what are they going to do? Well, they’re going to try to fit those valuations. Maybe try to build revenue as a private company and earnings, hopefully come out during better macro conditions when the Fed is not about to aggressively raise rates and go crazy and tighten, a like fast pace of more than 30 years, maybe.

Frank Curzio: So now, the venture capital private equity, what are they doing? Moving into the next thing, Metaverse 3.0 and not because they believe, well obviously, they believe they’re going to make money off of it, but it’s more deeper than that. It’s because they have to, since Web 3.0 will disrupt not just every single internet company, which we see who owns the internet and that’s going to change, but the entire financial system. Because you look at direct ownership of your digital assets, it’s going to replace all those third parties who love to bang you right in the you know what with massive fees. That’s what they do. These massive fees. “Oh, well we know a bunch of people. You want to raise money? Let’s bring you together. Give us 3%. Give us 6%. Give us whatever.” It’s all about fees. Remember Goldman tried to shove WeWork down our throats at $40B, $50B valuation. What is it, $3B, $4B? It went, of course, through a SPAC until people got a look at the S1.

Frank Curzio: It’s all about fees and how they can generate money. It wasn’t like, “Hey, we work as the greatest company. We’re going to hold long term.” No, they don’t hold this shit long-term. You think these companies in SPAC, they’re holding long… You’re the ones that are holding it long-term, getting wrecked. They’re out already. They’re gone. They bought their island and hanging out and all that shit. That’s what they’re doing. It’s easy to do when you have easy money policies and a Fed just throwing money out of a helicopter to everyone, not to the banks, like in 2008. But to everyone.

Frank Curzio: To us investors, you have two choices. Adapt to the new world of ownership, permissionless decentralization that gives you control of your digital assets on the internet or die. I mean slow or fast, you choose as you wait for inflation to be tame. “We hope.” We have the Federal Reserve saying, “We hope.” Think about that for a minute. We hope the smartest people that we hired to make sure that we have growth in the economy, control inflation, everything’s right, they’re like, “We hope.” You hope. Are you crazy? Hope is not a good word. Hope is uncertainty and uncertainty crushes stocks, which you’re seeing now. And the Fed has no idea what they’re doing, we all know that right now. We’re only at, what is it, .25% on a Fed funds rate. We have to get 3%. Again, people on TV are like, “Well, the Fed’s not going to be that aggressive.”

Frank Curzio: They could choose whatever they want. They could be aggressive about it, but they got to get 3%. You can do it aggressively, not aggressively, they got to 3%, whatever. And you could highlight and say, “Wow, they’re not aggressive.” And we’ll see the market rally, like we saw a couple weeks ago, rally a little bit. And then, you’re going to see all this happen again because they have to raise rates on monies coming out of the system. So slow or fast debt, up to you. By the time this happens and when they’re going through this, it’s not really going to matter. The major shift will take place. It’s inevitable. It’s one of the smartest early stage investors on the planet. People have been doing this for 30, 40 years are investing billions into the Metaverse and Web 3.0 right now. It’s the future. It’s your chance to own the next generation of the Microsoft’s, Google’s, Amazon’s, Tesla’s in the pennies. Think about that.

Frank Curzio: That helps you build FU money. I talk about, “Hey, I made money to buy a car, a house,” or take your family on a nice vacation to every year. I’m talking about owning your own sports team. I’m not kidding. I look at Mark Cuban. Look at Paul Allen from Microsoft, Vivic Grenadive, who I’ve interviewed a long time ago, or a typical software. The amount of money they made early on in these trends. Mark Cuban’s a great example of this because if he didn’t sell broadcast.com, he would never be where he is. What he’s did since then is amazing. But that was his claim to fame, billionaire, boom. And then, the market completely crashed. He just happened to be one of them that sold his company before the market absolutely tanked 70%, 75%, 80%, the NASDAQ from 2000, 2002.

Frank Curzio: These guys have personal jets with their own pilots, vacation homes in several countries. This is the opportunity. This is a major shift. This isn’t BS, this isn’t some high, this isn’t a stock. This is a culture. This is revolutionary. This is close to 30 years, which reminds me, I’m turning 50 next month. 50, wow, I’m getting old. I followed, invested in so many tech trends early on. I say, going to the Consumer Electronics Show, having special access, and it’s not just attending and you’re going to know, but just having special access and media access and talking to contacts. I mean IOT, social media, software, data analytics, cloud, AI, streaming, go back and listen to this podcast on iTunes. Last 10 years, 11, 12, 13 years, listen to all the things that we covered early on.

Frank Curzio: But this Web 3.0, DeFi, security tokens, NFT’s Metaverse, trends like this, they’re going to change the world, transform our culture, transforms every single industry like the internet. They come around every 30, 40 years and here it is, so get exposure. At least do everything you can to start learning about it because this is going to happen. It’s not like, “Whoa, this is going to happen years from…” It’s happening now. I mean, it’s happening a lot quicker than I even thought and forget about the reports from Goldman. I mean, anyone could say anything they want. Follow the money. Where’s the money going to?. It’s not going to SPACs. IPOs are shelved. We’re seeing market conditions that are absolutely terrible. Yet, billions are flowing into the Metaverse. That’s how big this idea is. And don’t think, wow, you have all these Metaverses and how it’s going to be one. It doesn’t have to be one. Think of it as a media company.

Frank Curzio: I mean, Netflix competing with cable companies or Comcast. It’s all about having the best content, if you have great content, people are going to go to your world. And that’s what it’s about. That’s what you see in Decentraland, Axium, and Infinity, and a few others that are starting to make a lot of noise, but start researching this industry. You could find a lot on the internet, get educated about the Metaverse because as you do at this stage over the next six or 12 months, you’re going to be able to, now that you have knowledge of the industry, you’re going to see who’s full of shit, what’s bullshit and what’s not. And what’s a really good idea.

Frank Curzio: Because you have digital real estate in the Metaverse, how this could transform into what? Think about our real estate industry, how many companies exist. I’m not talking about the home builders, but just things that track and data analytics, all this stuff. As you have more and more digital real estate, what places of for sale, what places are better bargains, all of this stuff. Start educating yourself. If you do, picking the right names at these levels, crypto or some of these companies are going to be focused on it where hopefully, we’ll see more publicly traded companies as the SEC’s going to be more on board with this. But this is something we have a chance to get in super early and make a lot of money.

Frank Curzio: You might be saying, just your head might be in the wrong frame of mind and I get it because the market’s so shitty, and you’re like, “Wow, I’m not concerned about that.” Listen, this is 2002. You could say, “Well, an incident in the early 1990s, how much, and it crashed.” Again, early 1990s, it was great to the mid- 1990s was the best time to invest and then it crashed. But think about 2002 and 2003 and people telling you, “Hey, you have to own Amazon here.” You have to own some of these things that are going to benefit tremendously. You’re probably thinking, “I’m getting my ass kicked. What are you kidding me?” Don’t think about the next 12 months. Think about the next five years.

Frank Curzio: Don’t go out 10 years or 20 years because when I go out 10, 20 years, my mind explodes of how crazy this is going to be, but just go out five years, where if you’re investing in some of these things, money you could afford to lose that you forget about them, there is a shot, which you don’t have in the stock market because these names come out crazy valuations. Within crypto, you have a shot, and nailing some of these things that could easily become $10B valuations, $100B valuations to $1T valuations. And if you hit the right one, you’re holding a 5, 7, 8 years, holy cow. Now, that’s a good investment. That’s a good speculation. That’s what you should be focusing on. And that’s what’s working. So guys, questions and comments, I’m sure I’ll have a lot of them. Feel free to email frank@curzioresearch.com. It’s frank@curzioresearch.com. Enjoy today. I’ll see you tomorrow with the one and only Daniel Creech. 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
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 Wall Street Unplugged podcast—ranked the No. 1 “most listened-to” financial podcast on iTunes—has been downloaded over 12 million times.

Editor’s note:

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