We hope you had a great Memorial Day weekend! This week, I dive deep into the auto industry… why the semiconductor shortage will cause a lot more pain for auto companies than most investors realize… and who’ll come out on top—and bottom—of this trend. [00:35]
Then, Reddit’s army of retail investors has done it again… sending shares of AMC Entertainment Holdings (AMC) skyrocketing to new highs. Daniel and I explain how “meme” stocks are upending Wall Street.
Plus, we discuss the new ExxonMobil board members pushing environmental, social, and governance (ESG) policies… and the impact it will have on oil prices going forward.
Finally, the largest bitcoin conference in history is kicking off this week in Miami… Here’s what we’ll be paying attention to… [41:56]
Transcript to come.
- The semiconductor shortage will cause a lot more pain for the auto industry [00:35]
- The latest “meme” stock saga: AMC [41:56]
- ExxonMobil and ESG [57:25]
- 2021 Bitcoin Conference [1:11:30]
Wall Street Unplugged | 776
AMC just changed the face of Wall Street
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 June 2nd, 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. Hope all of you had a wonderful Memorial Day weekend, the family, some beers and hung out. I always say don’t talk politics, but I think it’s impossible not to talk politics, even when you’re with your family and friends and stuff. It’s just natural these days. But now it’s back to work, and there’s a lot going on.
Frank Curzio: A few companies reporting earnings, in technology we had Zoom, Ambarella, you had Exxon, huge news. They hired several new directors from a hedge fund called Engine 1, who wants to basically change the largest oil company in the world into a green energy company. Huge news. AMC, what’s going on with that stock? It’s over $40. Skyrocketing on a lot of crazy news, I’m going to cover these stories later on with my buddy, Daniel. But the biggest story of the past few days, and few people are thinking about it, it kind of went under the radar. But for me, this is a huge story.
Frank Curzio: It came on Monday. So, Pat Gelsinger is the CEO of Intel, one of the largest chip companies in the world, we know that dropped the ball for a few years but doing better now, at least from a stock perspective. But he held a virtual session to talk about the state of the chip industry. And this was just a couple of days ago. And he said the COVID-19 pandemic had led to a cycle of explosive growth in semiconductors that has placed huge strain on the global supply chains. Pretty obvious, we all knew that. I mean, you look at the chip industry itself, grew 11% in 2020. Remember, pandemic year, grew 11% to 464 billion.
Frank Curzio: This year expected to surge well, well, well over 500 billion. Massive industry. Then he goes on to say, “While the industry is taking steps to address the near term constraints, it could still take a couple of years for the ecosystem to address shortages of foundry capacity, substrates, and components.” A couple of years. Now, look, we all know it, we all know there’s a chip shortage right now. I get it. It’s impacting numerous industries across the board, electronics, smartphones, kitchen appliance, washing machines, computers, processors. Anything that you plug into anything, right? Anything with electronics.
Frank Curzio: Goldman Sachs came out and published a report, Goldman Sachs by the way, banks at all-time highs. Most banks are at all-time highs, nobody’s really talking about it, they’re talking about oil and everything else. FAANGs still not getting back to their old highs. Banks, banks are on fire right now. But Goldman Sachs posted a report saying there’s 169 industries that are going to be impacted from the chip shortage, and this was just a few weeks ago. They also suggest that the shortage could last about the end of this year, maybe, maybe into 2022.
Frank Curzio: Now, when you’re looking at the industries that were hit, there’s a lot. A lot of industries across the board. But there’s one particular one that’s been hit the hardest, that nobody can debate. And that’s autos. Now, I’m going to break down some statistics for you, and stay with me, because usually I use this for an educational segment but I found this fascinating. You may not find it fascinating, which is cool, so I want to hear you, right, curzioresearch.com. I find this fascinating because I really dug in and it’s kind of like you go in that rabbit hole for me when it comes to research, it’s two, three days and I don’t talk to anybody for seven, 10 hours during that period.
Frank Curzio: And the research I uncovered is just incredible, I haven’t seen really anyone talking about it. You look at the average car, it has between 50 and 150 chips in it. They’re using everything, right? The driver assistance systems, navigation control, sensors everywhere, most everything in a car these days has a chip in it, tons of chips in it. Now, the average vehicle production is usually around 17 million units, and that’s in the United States, and I’m taking that number because from 2015 to 2019, it was over 17 million, around the 17 million annually over that time, but it fell to 14 and a half million in 2020 which makes sense. We had the pandemic.
Frank Curzio: Now, we have forecasts coming out of 16 and a half million to 17 million, to get back to normal. I can tell you right now, there is no way in hell we’re going to come close to that forecast. Absolutely, no way. Units, we’re talking about units. Amount of cars produced. And this is definitely not being factored into the auto stocks, which are trading not at all-time highs, I mean, Ford’s at a five year high, GM is at, depending if you include bankruptcy or not, none of them came out, but 10-, 11-year high, since the credit crisis. These stocks are on fire.
Frank Curzio: But take Ford for example. They reported their quarterly results, it was Q1, on April 29th. They reported 4.8 billion dollars in EBIT. That’s how they report, EBIT stands for earnings before interest and taxes. EBITDA is earnings, interest, taxes, depreciation and amortization. But EBIT, EBIT’s the number they use. 4.8 billion. Yesterday they reported 4.8 billion, I won’t make it complicated for you. This is Q1. Consensus? Analysts were expecting 1.5 billion. That number is insane. Absolutely insane that they reported.
Frank Curzio: So, let’s just say, if they happen to do the same exact thing every quarter, which is not the apples to apples comparison, but let’s just say, so, 4.8 billion, we can round it up to five billion, you times that by four quarters. That’s 20 billion in EBIT that they would do for the year, 20 billion, around. Again, we know that during the holiday season some companies sell more cars than others or sell more products than others, I’m just saying let’s just use that because it’s going to show you how crazy this is.
Frank Curzio: Because for next quarter, Q2, Ford said it’s going to see huge production cuts due to the chip shortage. And they said, they actually said, the production is going to be lost, it’s not going to be delayed, it’s going to be lost. So, this isn’t like, delayed, and it’s going to come, I love buying companies like that because they’ll miss the quarter and say, “Look, delays and whatever.” People are going to buy this stuff, they’re going to upgrade. No. People are not just going to wait around, they need a car now, they want it and they’re going to go someplace else or wherever they can to buy it.
Frank Curzio: Unfortunately, there’s not a lot of places out there where you can buy a new car, at least one to your specs. So, they’re predicting 2.5 billion in EBIT for Q2, so that’s down from the four and a half billion, still an amazing number. Remember, last quarter in Q1 they were supposed to do 1.5 billion EBIT, but they did 4.8 billion. Now, the two and a half billion dollars next quarter they predicted, so if we add the 4.8 billion in Q1, and the 2.5 billion in Q2, stay with me, that equals 7.3 billion, I’m going to use easy math. I don’t want to lose you here because this is important. That’s the first two quarters.
Frank Curzio: So, 7.3 billion, first two quarters. That’s Ford. They reported, which is called actual 4.8 billion and projecting 2.5 billion in next quarter, Q2. However, Ford also provided their full year guidance. And they said their full year guidance for EBIT is going to be six billion dollars. Think about that for a minute. You just reported 4.8, you just told us in April that you’re going to do about two and a half billion and you’re going to see production cuts, which is a pretty amazing number. That’s 7.3 billion, but the full year, you’re only projecting six billion? Which means you’re expecting pretty big losses going forward.
Frank Curzio: But they really didn’t say that on the call, did they? Because the stock took off and it went higher and everyone was like, wow, they bought the numbers, and, yeah, the chip shortage, okay. But for the full year, you’re expecting EBIT to come in at 6 billion dollars, really? That’s their forecast, that’s Ford talking. Now, during Q4, which was announced in January, Ford said it’s going to take a 10% to 20% hit in production. But in Q1, they actually upped that. Ford said that hit will be more like 50%. I think it’s going to be 70%, 75%, and wait until you hear the stats I’m going to throw at you.
Frank Curzio: So, what gives? Ford coming out, positive comments all around, they’re all happy, everything’s good. But yet the annual forecast, nobody’s paying attention to that, the analysts just kind of ignored it. And I get Ford, lots of debt, you want those investment fees, here’s your buy rating, and we love Ford. I get it, I understand the system, I grew up in it, Wall Street, I understand. But come on. You’ve got a company that just said one thing and did another in the same freaking sentence, in the same call. “Hey, things are good, we’re going to have a great quarter in Q2. Full year…” Just say it, “We’re going to report monster losses.” And it is going to be monster losses.
Frank Curzio: Now, industry professionals, so called professionals and analysts, are calling for a 20 to 30 billion decline in sales for the auto industry, because of the chip shortage. It’s going to be closer to 100 billion dollars, guys. 100 billion dollars. And probably another 20 to 30 billion in the first half of next year. That’s my prediction. Why? Because most auto suppliers shut down their production, and they’ve been shut down since April because they can’t get the chips, so they idled these plants. And this includes April, May, and now, we’re into June, and they keep pushing it out and saying, “First week, maybe the second week.” It’s going to continue to be pushed out because they can’t get those chips.
Frank Curzio: Most are still shut down. Now, for me, I wanted to find out why, why are autos the most impacted? Because we are seeing a lot of companies do pretty well that use chips in their systems, so why is it the auto specifically are really getting nailed with this because we know there’s a chip shortage everywhere? And you know why? Because the auto companies, for decades, they used a system and management process called Just In Time. So, it’s Just In Time supply chain management. So, they wait until they see what demand is like, and then they call the suppliers and say, “Hey, okay, this is what we need, let’s build a car.” Which makes sense, right? You want to keep inventory as low as possible, I mean, that’s the goal, to sell as many cars as people want, and you’re not sitting on tons of inventory because if you’re sitting with five, 10 million cars in inventory for 2021 into 2022, the value of those things is going to go down.
Frank Curzio: So, I could see why they do that, it makes sense. I get it. But now we have COVID, right? 2020. Everything opening up at this exact same time. People have more money today than they ever had, this government is handing out trillions, I mean, just here you go, here you go, here’s your money. Who needs it? Free loans, here you go, here you go. Just handing out money like crazy. But when you look at the other individuals, the chip manufacturing companies, so you have the major chip manufacturing companies. These are the manufacturers, a Samsung, Taiwan Semi, the two largest. Taiwan Semi is a monster in this industry.
Frank Curzio: These guys have been focusing more on creating chips for smartphones for 5G, PCs. Why? Because the Apples, the Lenovos, the LGs, these guys use a different management system and saw this coming months ago and said, “Listen, we really need to ramp up production,” and called Samsung and Taiwan Semi, and they ramped up production while the auto companies sit on the sidelines and say, “Well, let’s wait.” So, say if Taiwan Semi has 100%, is at capacity, and they have 25% or 20% dedicated to autos. They took that 20%, because the auto companies were kind of late, and gave it to 5G companies. Why, Apple came out, Apple released iPhone 12. I own a phone repair store. The iPhone 12 is an amazing, amazing, amazing phone. The 10, the 11, are exactly the same, there’s no upgrades or anything, they’re just selling the phone every year to make money, and next year’s phone is going to be even worse, it’s going to be exactly like the 12.
Frank Curzio: The 12 was a game changer with 5. Apple, during COVID, during the chip supply, was able to get their phones out pretty much on time, a little bit late. I got one a couple of weeks later, it wasn’t some crazy supply shortage where people were waiting for iPhone 12s, why? Because they paid the most money to Taiwan Semi and said, “Look, we need this.” And Taiwan Semi said, “Okay, well, we’re not really hearing from the auto companies yet, so let’s use that capacity.” Now the auto companies are dying. They’re dying. I mean, they waited and now they’re, I won’t curse here, but they’re F’d. So, you’re looking at auto companies lost their capacity allocations, and it’s crushing the industry, not the stocks though, the stocks are on fire.
Frank Curzio: And, again, everyone knows there’s a supply shortage, it’s a supply shortage. Every analyst talks about it but every single analyst, 100% of them, I’ve read tons of reports, believes it’s going to be short-term. Short-term, just like every analyst, I looked at JP Morgan and Goldman Sachs, I did so many live videos and showed you their research when it came to COVID, and they said, “It’s going to last one quarter, that’s it, it’s going to last one quarter, it’s going to come right back, V shaped recovery right away.” I said, you’re out of your mind, absolutely out of your mind. Last I saw, COVID’s still around, yeah, finally we’re opening up. We’re looking at 15 months later.
Frank Curzio: But they were like, “One quarter, GDP is going to take a hit one quarter.” No, GDP took a hit for four quarters before coming back. So, be careful with what the analysts are saying. I mean, stocks recovered very, very quickly but the economy wasn’t V shaped, no way. It’s still recovering. But when you look at the big picture here, the shortage in the auto industry, forget about 2022, it’s going to go into 2023. And there’s a lot of reasons why. I mean, first, demand is off the charts for cars, people are dying for cars. And there’s no supply. That’s why you’re seeing prices surge. I mean, the average new car price is $37,000 now. That’s up 9% from last year, 9% increase, and it’s going higher. Most people can’t get… It’s over 40 now, this is as of Q1, so reporting a month or two later.
Frank Curzio: It’s over 40 now. This is a massive increase. If you look at the statistics, people who are buying these cars, these new cars, they’re paying close to the sticker price and even more in some cases. There’s people who bought cars two years ago new, and you know if you buy a new car, you drive it out, you’re down, whatever, 10%, 15% right off the bat. They’re selling those cars for almost the same price they bought them for two years ago because there’s no supply. Think about if you have a lease like me, I know, this is what made me dig into this. I started looking at all this and I can’t get a car. I still don’t have a car, my lease is up the 6th, I’m going to have to buy my car. I tried to go to different places, I’ll get to more of that in a little bit.
Frank Curzio: But there’s no cars on the market. Inventory levels, lowest level in eight years. But there’s no inflation, don’t worry, guys, no inflation. It’s just transitory. It’s transitory, I love the Fed when they say transitory. Inflation is going to slow. Even though the Fed is going to keep interest rates at zero, continue to buy bonds. And our government’s going to continue to hand out trillions like it’s Christmas for everyone. Here comes the infrastructure package, here you go, take some money. You don’t need it, here, shoving it down your throat. Here’s more money. There’s so much money that people want products and we can’t produce products fast enough, that’s why there’s a shortage in everything. Commodity prices are through the roof.
Frank Curzio: It reminds me of the Naked Gun, when that guy is riding that missile into the fireworks factory, and Frank Drebin’s chasing him, and the building blows up and the fireworks are going everywhere and it’s crazy, and he pulls out his badge and says, “There’s nothing to see here, there’s nothing to see here.” Are you kidding me, with this inflation that people say is transitory? You’re out of your mind. This isn’t because of a reopen train and everything’s going to go away, the Fed’s still pedal to the metal, they don’t need to be anymore. But everything’s going to be okay, see it across the entire industry, but look at this industry.
Frank Curzio: Now, getting back to autos here, some other minor, teeny weeny, little things to consider for the auto industry that could negatively impact them. Like, the surge in people moving to the suburbs for reasons you all know about, I shouldn’t have to really go through this, right? If you don’t know what I’m talking about, just try walking through New York City, Atlanta, any major city at night after 10:00 PM. Just make sure you say your prayers first. So, everybody’s going to the suburbs, which means more driving. Less taking the bus, the Ubers and stuff. That’s more demand, right? Which is good for the autos but they just don’t have the chips. So, you’re seeing demand surge even more. While many of the chip suppliers say that they’re increasing capacity, most of this is not going to take place until mid-2022.
Frank Curzio: Taiwan’s like, “We’re going to up another plant at the end of the year,” yeah, right. “We’re going to just open up another plant.” Are you out of your mind? You’re going to open up another plant by the end of this year? No, it’s not going to be that fast. You’re looking at, really, probably 2023, 2022 maybe, mid-year I would say. Now, when you look at the industry itself and the autos and the biggest names that produce chips for autos, it’s Infineon, 13% of auto chip market, Infineon. Texas Instruments is about 8%, Microchip, Qualcomm, Skyworks all have a pretty decent percentage as well. And almost every one of these companies, every one of them, uses Taiwan Semiconductor to manufacture their chips. Nvidia is at a 52-week high. You know why?
Frank Curzio: Because autonomous vehicles counts for a very small portion of overall sales, so they’re not seeing that like they are the chip industry where there’s a chip shortage, but other people outside these industries have adjusted and maybe they’re a month late, a month and a half late. I’m going to tell you how late some of these things are going to be produced for the auto industry, because I don’t think, it’s definitely not factored into these prices. So, as of today, if you’re looking at capacitors in the auto industry, the lead times are up to 45 weeks. It’s over 10 months. Sensors are at 40 weeks, nine months, mic controllers are at 30 weeks. Analog chips are at 40 plus weeks. I know, I did the research for this. 10 months, are you out of your mind?
Frank Curzio: Now, a couple of weeks ago I told you guys about, hey, I’m looking for a car, and I was just amazed that I couldn’t get one. That’s why I’m spending so much time on this subject, I said, wait a minute, there’s something bigger in this industry, because they say, “Well, it could come in four months, it might be six months.” It’s a lot longer than that. And analysts, anyone, these experts, I mean, I don’t think they get how bad the chip shortage is in the auto industry, and even Ford and GM are not telling anyone which is kind of messed up, that’s your job.
Frank Curzio: But being in the market for a new car, you start asking lots of questions and they were telling me four to six months to purchase a new vehicle from scratch, which is BS. Now, just this week, and this was Monday, I was looking for a car online and I saw that there was a new Chevy Suburban on a lot in Jacksonville, and I called them and said, “Hey, is this car available?” It’s a pretty nice car, it has a lot of the specs that I like, and the color was pretty cool, and I said, all right, we just need one because we’ve got to give back our lease. I really don’t want to buy the current car we have.
Frank Curzio: And he got back to me and said, “No, we must have sold that car,” I think someone who was supposed to buy it had a nine month timeframe, that’s when it finally came, nine months. Nine months ago this was happening. Nine months ago this person bought this car and it just got delivered on the lot a week ago and he said, “Someone else bought it, and we sold it, and it’s not there anymore.” He goes, “This is very high demand.” I said, “Are you telling me nine months? Because I’m hearing four to six months.” He’s like, “Actually, if you decide to buy a car now with your own specs where it’s just your color and whatever or type,” you know what you do when you go on a website and you build it towards your specs.
Frank Curzio: He said, “You’re likely to get it in Q3 of next year.” That’s 15 months from now. Think about that. So, mid to late 2022 is the quickest I’m going to get a 2021 model? You’re looking August, September. So now, you have all these 2021s that aren’t going to be produced until mid-22? I’m going to buy and pay full price for a 2021 car, and I’m going to buy it a year later? How is the auto industry going to handle that? How are they going to get 2022 production when they can’t even get 2021 production online until late 2022?
Frank Curzio: That’s just half the story. That’s just half the story. This gets really fun now. I told you, the rabbit hole; hopefully, I’m not boring you because this stuff’s fascinating. So, to make matters worse for this industry, there’s a huge shortage of natural rubber, where prices are up 58% in just the first three months of 2021. Just in the first three months it’s up 50%, not year over year, 50% in the first three months. Now, why? You could blame COVID. Did some research, because I’m a nerd, on natural rubber, which is harvested by trees, so weather is a huge issue that could impact supply.
Frank Curzio: And in 2019, pre-pandemic, a leaf disease plagued this industry in major rubber producing countries like Thailand and Indonesia. And then in 2020, we had COVID, and farmers are like, “I’m not planting these trees, no way, there’s no demand out there, absolutely not.” And that’s kind of crucial considering it takes six to seven years for these trees to mature. So now, you’re going to see rubber prices go through the roof. Throw in high rolled steel prices, up 100% year over a year, aluminum up 80% year over year, this is everything that goes into a car. Stainless steel up 50%, copper, you know it, near an all-time high, led up 75% plus year over year. And all these things go into a car.
Frank Curzio: There’s no inflation though, it’s transitory, there’s no inflation. No inflation. But JP Morgan came out with an interesting statistic, they put it all together, these commodities, they call it a weighted commodity index of vehicles, so the prices of all the commodities combined to make the car, on average how much those prices are going to cost for auto companies. And the average weighted of all these commodities are up 80% year over year, 80% prices are up year over year. We’re not talking about food prices that are up, wow, 10%, or this is up 6%, or this is up 8%. 80%.
Frank Curzio: But there’s no inflation. Don’t worry about it, it’s only going to be a little while, and we’re going to be fine, that’s okay, it’s going to be transitory. And how long is transitory? The Fed doesn’t tell us that. So, when you say brief, I think three months, I think maybe, maybe I might give you six months. No, transitory to the Fed means 18 to 24 months. We are going to see inflation explode. We’re seeing it, we’re going to see it explode because the only cure for this is to raise prices across the board in every industry, raising prices, it’s the only cure, that’s how you’re going to make your numbers. Just raise prices.
Frank Curzio: When you’re looking at retail sales being higher, you’re looking at all kinds of sales being higher, it’s not because they’re selling more products, they’re selling less products for much higher prices which nobody is talking about. There’s just not enough products to buy. You’re throwing in, in the auto industry, throw in the stockpiling from China, which China is brilliant, right? They’re going to screw our domestic auto industry beautifully, stockpiling a lot of commodities. Then you throw in Goodyear and Bridgestone, I looked at those companies, and they say, “Hey, you know what, rubber prices, things are okay for now.”
Frank Curzio: Because there’s really no supply in the market, right? Everything’s idle so no one’s really buying stuff. But next year, good luck. Rubber prices are going to be to the auto industry what lumber is to the home industry. You’re looking at 300%, 400% increase in a year timeframe. They’re going to absolutely surge. They’re already starting to surge, you’re not really seeing it that much because, again, there’s not enough cars right now, no one’s really producing cars. But you’re going to see it next year. These are all major, major, major headwinds. And then throw in that everyone, the clean initiative, everybody’s green now, again, Al Gore did a great job. California’s supposed to be underwater by now, that’s what he predicted. “It’s going to be underwater, we’re dead.” And he just bought a 6 million dollar house, 7 million dollar house, I think, in California. He’s so smart, that guy.
Frank Curzio: Just tell people something that they can truly believe in and you’re going to make the most money possible off of it, it’s very easy to do through social media. Just like COVID, it didn’t start in China, it didn’t start in China, COVID, no way, it wasn’t from the lab. That’s what we were told. If you reported that or if you said that on social media you were thrown off social media. Now? Wait a second, maybe it was. It’s so easy to make people believe in shit now with social media, right? But you throw in the clean initiative, we’re all dying, climate change. Every auto manufacturer in the world is running to produce as many EVs as possible, electric vehicles, and that puts even more pressure on these supply chains to produce chips.
Frank Curzio: I mean, you really think you’re going to buy an electric vehicle from anyone other than Tesla this year or next year? I’ve got to tell you, 80% of you who want to buy an EV, outside of Tesla, you’re probably not going to get it until 2023. Probably 2023. If you’re lucky. I’d say at least 80% of people, you might have a few people, maybe. But that’s how long it’s going to take. Which, by the way, brings me back to Ford really quick, because I’m going to tell you how to play this with stock and what I think.
Frank Curzio: So, Ford just reported in late April, broke those down for you, they said one thing and then said another and said, “Hey, things are great, reported a great quarter, next quarter’s going to be pretty good but our full year is going to be trash.” But they didn’t say that, right? So, it means Q3, Q4, they’re dead. And they actually said production is going to be lost, not delayed. Nobody’s talking about that, analysts don’t care about it, they don’t care. I care about it, because these are things that I find. But then Ford had their analyst day on May 26th. Their analyst day. And Ford did a fantastic job, because management came out and said it expects to control 40% of the EV market, 40%, and the stock took off.
Frank Curzio: I’m a fan of Ford, and I know how big, I said this for the last three years because I go to the Consumer Electronics Show, and Ford is always there. The amount of money when I dug in, they were putting more money into EV technology than anyone in the world. Everybody thought it was crazy, I said, I know it’s Ford, I know it’s at $7, I know it’s at $8, I wish I’d put it in my newsletter. I said, believe me, these guys are going to be huge in EV, they’ve spent a ton of money and took not just one step, probably three steps back, but now they’re saying, “Hey, we’re going to control 40% of the entire EV market by 2030.”
Frank Curzio: And what happened to the stock? It surged to a five year high. Closing on $15 a share. So, 40% of the EV market, the little part that really didn’t get a lot of notice was 2030. You know how long that is? I mean, come on. Eight, nine years, I mean, 2030, we’re supposed to be at zero carbon emissions, which is a joke. What is it, 80%, 85% of our energy in the US consumption, I’ll cover this later with Daniel, comes from coal, natural gas and oil? Really? Free carbon emissions 2030? Good luck. Good luck. Even with the new management team and the new directors at Exxon and all these changes, good luck with that.
Frank Curzio: But 2030, and that pushes stock up because everybody was happy with Ford, holy cow, they’re in the EV trend. Yeah. We’re talking about they’re not going to have a car on the market for another year and a half, two years. Their plants are still idle. They’re getting crushed right now. Their numbers are going to be absolutely horrible going forward because they have nothing to sell, they can’t sell anything right now. But stocks are at an all-time high. Or close, I don’t know if it’s an all-time high, but it’s a five year high. So, we’re looking at forecasts like this, with a company that’s going to see a massive decline in unit sales, at least over the next nine months, probably more like the next five to six quarters.
Frank Curzio: Again, those plants are idle, and everyone’s buying their stock right now. And General Motors, put them in the same category, it’s another one. Going to be hugely impacted by the chip shortage. Has plants idled, still, but its stock is at, what, a 10-year high? Whatever it is. After they came out of bankruptcy. And the stock keeps going and going and going. I mean, based on the most conservative analysis that I’ve done, very, very conservative number, we’re going to see at least a 20% cut in production due to chip shortage over the next six months, at least. It’s probably going to be more like 45% to 50%. They just can’t get these cars. They can’t get the chips in the cars, they don’t have the capacity because everyone has this chip shortage and if you look at the major technology companies, they took up most of the capacity at Samsung and Taiwan Semi.
Frank Curzio: So, that leaves, “Oh, we have to open up new plants now, we have to open up and build new plants, which is only going to take a couple of months.” Are you crazy? Do you know how long it takes to build something like that? Even in China, where you’re paying those guys $1 an hour, and you’re shipping them in from inland and have these guys sleeping onsite, which they do, it’s crazy, those conditions. I’ve seen them, I’ve been to China. Even with those guys working 20 hours a day it’s going to be hard to get this thing up and running that fast. So, how do you play this from a stock perspective?
Frank Curzio: Ford and GM are shorts right now. Buy puts, I don’t know, but you may want to wait until the trend breaks a little, technical allowance is a big deal these days, especially when you look at AMC, you look at Doge, I mean, numbers don’t matter. Numbers don’t matter these days. But what’s the positive catalyst for these companies over the next six months? Even after nine months, they’re going to report terrible numbers, they’re going tell you, “EVs are great.” They’re not going to produce the EVs though, they can’t, there’s no chips, they can’t even get 2021 cars on the lot. They’re going to wait until 2022, how are they going to solve that problem alone? Your 2022 cars are going to come out in 2024? I don’t know, I don’t get it. They don’t explain it. Analysts don’t care right now.
Frank Curzio: And by the way I’m not totally convinced that’s the way to play it, because like I just said, numbers don’t matter. I mean, look at Disney. I was wrong on Disney, I was wrong, I can’t believe I’m one of the analysts in the world that say when I’m wrong, holy cow. It puts me in a different category than the whole entire industry. But I was wrong on Disney. I was right on the numbers but I was wrong on the stock and the stock went higher and higher. Disney’s going all in on streaming, I know streaming very, very, very well. I said, this is a money losing industry, companies lose billions and billions and billions of dollars to generate five, six, seven dollars a month, maybe 10 dollars a month.
Frank Curzio: And it all worked because of COVID, more people were staying home. So, what did Disney do? Disney said, “Hey, you know what? Nobody cares about earnings and sales, nobody cares, and everything we do is closed, right? Broadway, our parks, Hollywood, everything is closed, let’s just go all in on streaming, give the service away for free for everyone practically,” I mean, I got it for free for life because I’m a Verizon customer, “And build that up to 100 million plus people.” And Wall Street bought in and said, “We love this, this is awesome.” Even though Disney is one of the very, very few companies, you look at earnings in the S&P 500, almost all these companies are reporting earnings that are higher than pre-COVID levels. Disney’s not going to do that for at least another 18 months to 24 months.
Frank Curzio: Because they gave this service away for, what is it, $5 on average they pay a month? If you’re looking at Netflix it’s more than double that. But not only that, you’re competing against Netflix, and you’re competing against Time Warner now that it merged with Disney, they both say they’re going to spend 17 billion to 20 billion on new content, and Disney’s like, “We’re going to spend six, seven billion.” How are you going to get to seven billion without generating cashflow? You’re going to have to raise money through the market. So, it’s almost like Curzio Research, right? We have our CEO token that you have an equity stake in our business, we pay a dividend. I mean, maybe I should say we’re giving away all of our research products for free.
Frank Curzio: Our token will probably go up 1,000%, we’re not going to generate money but who cares? We’re not going to generate any money. Nobody cares. But when our stock goes up, we just do a capital raise just like AMC did. We’ll reach 25, 30 million dollars by selling share and diluting, I mean, is that the new business model? Is that it? That’s pretty crazy. It used to be about earnings. But Disney’s in a real tough spot now, I mean, they missed their earnings last question, they missed sub numbers. And now, they said, “We’re going all in on a business model that produced billions and billions and billions in losses.” It’s a tough business.
Frank Curzio: I mean, dealing with actors, locking them up for contracts, it’s difficult. Netflix gives away everything to these people, that’s why there’s not an actor that hasn’t worked for Netflix that didn’t say it’s the greatest thing in the world. They love it. It’s like they get full rein to do whatever they want. In all these other studios, it’s kind of like the studios run the show, at Netflix it’s the actors that run the show, that’s why they all love going there. Now, you’re going to try and take these people away? You know how much money that’s going to cost? Now watch, Disney’s going to shift and say, “Well, our parks are open and now we’re doing good.”
Frank Curzio: Because I don’t know if they’re going to have pricing power. I know if they charge me, I wouldn’t pay for it, now the economy’s open, you’re not going to see as many people staying home watching movies because we were forced to stay in because of a bullshit initiative by our politicians. So, are Ford and GM shorts based on the numbers? Absolutely, but who knows? There is zero chance of them meeting their estimates unless sell-side analysts happen to lower them by 40%, 50% going into the quarter, then they’ll say, “They blew away estimates.” The people that I’m talking about during the quarter that they lowered them tremendously so they could beat them. At the end of the day these companies are going to have to take massive write downs, you’re going to see massive losses.
Frank Curzio: Again, these car companies, already it’s a tough business, the auto industry. It’s already a tough, capital intense business, now you’re not selling any cars, your plants are idle and this chip shortage specifically for autos is going to last much, much, much longer than anybody believes. And that’s dangerous when these stocks are trading not just at 52 week highs, but five-year highs, 10 year highs with GM and Ford. So, if these guys continue to bullshit you about EVs and maybe they do that, I don’t know what the positive news is going to be over the next six to nine months because they’re not selling cars. You’re not selling any cars. I don’t know if you’re going to make investments, I don’t know if you’re going to get someone into your stock at a lower price and it’s a big name, I have no idea what the catalysts are.
Frank Curzio: But I tell you what, insiders are not going to be buying at these prices, they’re going to be selling and they’re nuts not to sell. You’ll see it. Because there’s no positive catalysts coming out, other than them bullshitting you and saying, “The EV market, we’re going to control the EV market, we have all these cars coming out,” and they’ll show their model, like the Mach 1, and the Mustang, “Look how great this is.” You’re not going to ever see this car, “But look how great this is,” and post it every place and people buy the stock because of it. That’s the new world.
Frank Curzio: But as the numbers go, I would short these things, but if you don’t want to short the other great play here is buy CarMax. When I dealt with CarMax for the first time, a lot of you have probably dealt with them, this is a company that just sells used cars, and ship them in from everywhere. I shipped a car in for 200 bucks, it turned out that I didn’t buy it, but it was like a week later, they call me, everything was great, the service was great, the place was packed. People need cars. They can’t go to the dealerships, the dealerships don’t have any cars, they barely have cars in their lots. It’s going to be like that for a long time.
Frank Curzio: So now, you have CarMax trading at, what? 25 times forward earnings, you think that’s expensive, their earnings are going to explode. They’re going to explode, they’re going to be able to charge whatever they want for cars, it’s the only game in town. And you see prices surge from these levels, at least over the next nine to 12 months. Who benefits? CarMax, they’re the ones that have cars. I never thought of, hey, I’m going to buy a used car from a used car lot, I didn’t do that. Normally I lease a car or maybe a car that’s a year old if they’re selling them off the lot at the dealership, I was forced to go to CarMax. I’m telling you, being forced to go to CarMax is like being forced to use Amazon during the pandemic.
Frank Curzio: You realize, holy shit, this is really cool. This is awesome. There’s a lot, a lot of people that don’t use Amazon and everyone’s getting their shit delivered by Amazon and they’re not going to change now because of the pandemic and they’re going out and they like to go shopping. I mean, it’s nice, every month you get your paper towels, your toilet paper delivered to your doorstep, your paper plates. It’s pretty nice. You put it on auto. People aren’t going to change that. Now that you’re forcing more people to go to CarMax, I wasn’t familiar with this brand, I knew it was good, I knew it was a good management team. I knew the numbers. I didn’t know the service and personally went there and this was amazing. Because this is a company that could easily double from these levels, they’re right in the middle of a great trend, they’re the only game in town basically.
Frank Curzio: You’re looking at all these commodity prices going up, all this crap within the auto industry, shipping supply is also a constraint. Another thing that’s not being factored in. But you’re looking at CarMax, that’s a big winner, AutoNation could be another winner, but most of their sales, I did the research on it, close to 60% of their total sales come from new cars. But they do have used cars and that’s probably going to be a bigger percentage this year, so AutoNation might be a better play, it’s a little bit cheaper. But cheaper doesn’t mean it’s a better buy. CarMax deserves a premium because they’re number one, they’re great. That’s why you saw Amazon expensive 10 years ago, Apple expensive 10, 20 years ago, Microsoft expensive 10, 20 years ago. Look where they’re now. People, they want to buy them at 70 ADPs, which they were trading at, but look at the massive growth. So, don’t get scared off by 25 times forward earnings. Because that company is probably going to get cheaper even as the stock goes up because earnings are going to explode. Explode.
Frank Curzio: A lot of fun stuff in there, the auto industry. Again, I usually save that for my educational segment, but I was just fascinated by this and a lot of the stuff that I just told you you’re not going to read any place else, it’s really digging into a lot of sources and people and doing boots on the ground research. For me, I like sharing this stuff for you, because, one, it’ll teach you, even if you don’t care about autos or you don’t care about buying CarMax or shorting GM and Ford, which, again, I’m not telling you to do right now because they’re in up trends, and you’ve got to be careful. Ford can go to 17, 18, 19, just like Peloton. And Peloton, whatever it went to, 175, went back down to I think it’s around 100, 105.
Frank Curzio: These things can go up tremendously before they finally come down. But you can use this type of research and dig it in, you just go to your Google sites and do your own homework and stuff, and this is how you find good ideas. By going out there and realizing, holy shit, this doesn’t make sense. This isn’t what I’m really hearing out there. And it happens a lot. Because there’s a narrative out there, especially with social media, where people can just cloud your mind with bullshit and tell you something and you’re going to believe it because it’s the only source. I watch Facebook or I watch CNN or I watch Fox News or whatever, you’re going to be conditioned for what they believe. And these guys all have an agenda to make money, which is fine, that’s what they do.
Frank Curzio: They have an agenda, and they want to make money. But go out there because when you go against the grain, that’s how you make a fortune, in ideas, in stocks, by buying sectors. By doing something nobody’s really talking about, yes, there’s a chip shortage, we all know about it. Nobody knows how terrible it is in the auto industry, and I guarantee you no one’s saying, “Wow, if I order a car, I’m not going to get it until 15 months from now. I thought it was four to six,” that’s bullshit. It’s much, much, much longer than that, which is going to crush these auto companies, but, again, maybe their numbers don’t matter in today’s market. Because they’re going to be talking about EVs, but eventually numbers do matter, and I see zero catalysts out of this industry at least for the next six to nine months.
Frank Curzio: So, lots going on, and I don’t have a guest this week, only because we’re coming off Memorial Day weekend, and doing this for as long as I’ve been doing this, I could call numerous amount of people and be like, “Hey, man, I’ve got a spot open, you want to come on real quick and just bullshit and whatever?” But with the holiday weekend and Monday, I don’t want to call anyone on Monday to do an interview on Tuesday or maybe Wednesday, I said, you know what? Let’s just go with the flow, and you have just me today. Again, I’m a nice guy, I have respect for people. You’re coming in Tuesday off of a holiday and there’s not too much to talk about until Wednesday maybe early, which sometimes I shoot my videos at.
Frank Curzio: But give everyone a break, have a nice guest next week. But that means you’re going to get more of me and more of Daniel Creech. So, Daniel, what’s going on, man?
Daniel Creech: What’s happening, Frank? Another retail driven day, I thought AMC going up over 30% was impressive until I saw Best Buy is up 40, so we’ve got a lot to talk about.
Frank Curzio: Wait, Best Buy is…
Daniel Creech: Bed Bath & Beyond, I’m sorry.
Frank Curzio: Bed Bath, yeah.
Daniel Creech: Bed Bath & Beyond.
Frank Curzio: So, I didn’t even see Bed Bath & Beyond yet.
Daniel Creech: It just came across the ticker, it was hilarious, and I was just about to say, “AMC, check this out,” and Bed Bath & Beyond is up 40% right now, apparently driven by the Reddit forums on WallStreetBets and such, so, yeah, retail is giving everybody a run for their money, you’ve got to like that.
Frank Curzio: Yeah, you know, Daniel, you better be careful too, if you’re buying a heavily shorted position right now, right? So, I mean, Reddit sees that, and they’re able to get a lot of their users, which results in, you know, Melvin Capital is, what, a 12 billion dollar hedge fund that needed a capital infusion when all this shit happened. But it’s amazing, right? Because everyone’s looking for the next stock, and it’s not about earnings, it’s not about numbers, which is pretty crazy. I guess we could start there with the AMC thing, because there was so much news on this thing. It’s up, what is it, 40 bucks now I think?
Daniel Creech: Things move so quick, 43.
Frank Curzio: 43, I think it was 25 at the start of the week. But on Tuesday, we have AMC announce that it’s going to raise money, it sold eight and a half million shares to Mudrick Capital. Took place around 27 dollars a share and that was a 230 million capital raiser, everyone was happy that they raised money, which was cool. The interesting part of this story, this Mudrick Capital, which by the way they created a SPAC, and it was an early SPAC, and I have to tell you, these guys did a fantastic job. It was one of the best companies that they bought, they bought Topps, the card company. Sales surged 55% now you have the Major League Baseball getting into NFTs and stuff. I mean, these guys did a good job, where a lot of these SPACs are BS now and getting killed, these guys were early on and bought a really good company.
Frank Curzio: And that’s the problem with SPACs right now, they can’t really find really good private companies to buy, so, credit to Mudrick. But in this transaction, which we almost never ever see when you have an investor come in, is there was no lockup. These are freely traded shares immediately. So, Mudrick turned around two days later and sold their full position, which was at 35 million dollars, about 15% they made on that position, 35 million dollars in a day. In a day. Which, Daniel, is not a good thing because if they held it to today, just another day, that 230 would be worth 350 million, so you’re looking at a 110 million dollar gain in two to three days instead of just a 35 million, if they just waited until today to sell. But how crazy is this?
Daniel Creech: You know, the funny thing with this is you can’t have it both ways. So, if you’re in the meeting and you’re reporting on this, this kind of cracks me up because there’s a lot of people on Wall Street that are upset that AMC and retail investors made so much money and there’s so much anger out there about fundamentals and AMC and these guys, everybody buying AMC is basically perceived as an idiot and don’t know what they’re doing. And you can make that fundamental argument, I’m not disagreeing with that, you can say it’s overpriced and all that.
Daniel Creech: However, then a hedge fund turns around and makes a lot of money, and now the media is kind of pissed at them and saying, “They’re just taking advantage of the retail investor.” The crazy thing was when they did this offering, they bought at a higher price than when it closed on Monday.
Frank Curzio: Mm-hmm.
Daniel Creech: So, typically, if you’re trading at $30, you’ll come out and offer shares, and let’s say you go 29, 28, you go lower. This was trading at I think 27 and change, or 26 and change. Tuesday, they come out and they do a higher offering. So, there’s some skepticism there that, hey, they were in cahoots basically trying to get a short squeeze to go even higher, and then he turns around and liquidates all that, the hedge fund. But as long as you’re disclosing everything, there’s nothing illegal about this. And again, just to your point, if he would’ve held it longer, he’d be up even more. So, you can’t complain about retail investors making a lot of money and then complain about hedge funds making a lot of money, so to each their own. There’s a lot of Vegas going on in the stock market right now, but there’s always been craziness and fundamental arguments and all that kind of stuff.
Daniel Creech: What we’ll watch play out and see is what did AMC come out to do today which you loved, when they started their little-
Frank Curzio: I love that.
Daniel Creech: Frank’s going to eat so much-
Frank Curzio: I love it, that’s the one thing everyone hates, going to the movies and paying like $8 for the tub of popcorn and the $5 for the soda, and AMC just came out today, and they said that all their shareholders, which turn out to be, what is it, 80%, Daniel?
Daniel Creech: I think they said 80% are retail investors, yeah.
Frank Curzio: Are retail investors, so if you’re a retail investor, you’re going to be able to get certain deals and certain discounts when you go to the movies, which includes free popcorn and stuff. I mean, it makes me want to buy a couple of shares right now to be honest with you, but I like that move because it’s just the sentiment behind it, it’s all marketing, right? It’s all training your brain, where if you said, “Hey, we’re going to give all our shareholders 15 bucks,” it wouldn’t be a big deal, all right? They don’t want to say anything, but when you say you’re giving away free popcorn, it’s almost like as if you gave someone a bonus of $3,000, and they’re like, “Wow, that’s cool, that’s awesome,” but yet they know that…
Frank Curzio: You know, they love Pelotons and you send them a Peloton, they’re going to be like, “Oh my God,” it’s the same price. But in your brain you’re like, holy cow, and I just thought that was a really smart move, so.
Daniel Creech: Don’t give me a Peloton. If you give me a bonus, give me a bonus.
Frank Curzio: Yeah, if I was going to give you a bonus outside of money, I don’t know, it’s going to be cigars, golf.
Daniel Creech: Yeah you go, yeah, that easy.
Frank Curzio: Yeah, that’s more easy.
Daniel Creech: What we’re watching play out though is you’ve got to give a lot of credit or at least I do to the AMC CEO, because you’re taking the hand you were dealt. I’m not saying that he had any influence, and I don’t exactly know how Reddit, I don’t know how it got popular on these blogs or whatever, and it’s not important to me, but this guy is using the hand that he is now dealt. You go from near bankruptcy, they still have a ton of debt, so you could argue, man, they need to pay down that or at least roll it out. But you talk about being a well-run CEO saying, “Hey, we’re going to raise money,” which they have. They at least have a lot of capital right now to do things.
Daniel Creech: They can renegotiate with different theaters, and they can also look to add more theaters. If you think that people won’t go back to theaters, then you can go ahead and try to short it or stay away, because it’s got so much momentum. But I don’t think it’s a stretch to think that your average person is going to go back to a movie theater. I wouldn’t be nervous about going to a theater, I can’t remember the last time I was at a theater, but it’s not because I’m nervous about being next to somebody or the COVID, it’s because I’m not really that big of a movie buff, so.
Frank Curzio: Yeah, and you know, Daniel, one of the biggest things here for me is everyone’s happy with this deal. You have AMC have raised a shit load of money, 230 million dollars, which is great for their balance sheet, right? Their junk bonds, which were due in 2026, were trading at five cents, they’re now trading close to face value, good for them. Mudrick Capital is happy, one day gain of 35 million. These guys made a fortune too, easily over 100 million at AMC, I think 200 million plus total AMC and GameStop with their positions early on. The shareholders are happy, since the stock is roaring after AMC raised money, and they also announced free popcorn for all shareholders which is probably the best thing of this whole deal, which I love.
Frank Curzio: But the only loser here is probably this guy Rich Greenfield from LightShed Capital, and I don’t want to poke fun at him because he’s looking at the numbers, but obviously he shorted the stock, and he has a target of one cent on AMC.
Daniel Creech: They really published that?
Frank Curzio: Yeah, one cent.
Daniel Creech: They have a price target of one cent?
Frank Curzio: One cent, one penny, yeah. So, I think he’s going to have to upgrade that to like three or four cents now after they raised money. I’m sorry, I mean, look, the thing is you’ve got to worry about people like this because you have to see when things change, they change, and I credit Citron, Citron said, “We’re not shorting stocks anymore because we got wrecked,” and this could easily happen because your short positions are public, right?
Frank Curzio: Not your personal short positions, but the short float is public information, it comes out a couple of days later but you could see which companies have the largest short positions. And if you result in a short squeeze, which is pushing the stock price up because, guys, when you short a stock, your loss is infinite. It can go to 100, 300, 500, 1,000, when if you put $10,000 into a stock and it goes to zero, you lose $10,000, right? You just lose the amount you’re putting in.
Frank Curzio: You can get destroyed, you can lose everything you have, right? Everything you have in your account, margin calls and whatever, so when you see that stock going, you’re short, say, seven, eight, nine, 10, 12 dollars and it goes to 17, 20, 22, you’re forced to cover the short which means you have to buy the stock which pushes it up even faster and that’s what creates a short sell. And some of you know that, all of you know that. But now you have the Reddit crowd looking at, hey, where’s the high short positions? You’ve got Bed Bath & Beyond, again, which is a shitty business model, right? They resell everything for very expensive prices unless they give you that card that says 30% off, it’s a crappy business model, they should be out of business.
Frank Curzio: But who cares? Just like GameStop, you’re not selling anything anymore, I love GameStop, but listen, every game is online now, you don’t have to go to the stores, and now. They’re getting into NFTs or whatever they should get into, anything, they’re going to get into the hottest trends because they raise money as well. But when I look at everything that’s going on, even with AMC, AMC, again, it surged but it’s one of the areas, Daniel, I have to say that it hasn’t really taken off along with the reopen train where you saw airlines, you saw travel related companies, even the cruise ships who are still not sailing yet, are well, well above their pre-COVID highs in terms of their stock price and enterprise values.
Frank Curzio: So, this is one sector that really hasn’t come back, and you haven’t seen demand come back, but the way it’s coming back right now, this is nuts, man, this is really, really insane and, yeah, I don’t know, it’s probably going to go higher. It’s up to 44 now, it goes higher as I’m looking at my screen, it just goes higher and higher.
Daniel Creech: Yeah, and what I like about the CEO, at least he’s tapping into this, and I’m not saying this is anything new because you’ve always had more vocal CEOs than not or some people kind of hang out, not in the limelight, some are more vocal. But if you look at some stocks like Elon Musk and Tesla, you cannot argue that he does not have an amazing relationship slash connection with his shareholders and his fans. And the CEO of AMC, Adam Aron, is tapping into that, and I think that’s a brilliant move. I think the only thing better he could do, Frank, you get a group of retail, what was that, Roaring Kitty? He made all the money on GameStop. I don’t know if there’s a popular guy with AMC or a popular retail investor, I’m sure there’s a ton of them out there that have made a ton of money.
Daniel Creech: But what if they give a board seat to a retail investor? Why not go all in? You want to get a direct relationship with individual investors and change it up, now, I’m not saying that’s going to happen, I’m just simply saying that would be a lot of fun and add to this saga that we’re watching unfold-
Frank Curzio: You don’t need it, why take the board seat? Mudrick Capital, why take the board seat? You’re in, and you’re out of it and you get freely traded, I mean, freely traded shares is pretty crazy. But I have to tell you, there’s a bigger point I think that’s not being mentioned on CNBC when they talk about this, and they covered all the points we covered today, and how much Mudrick made and the shareholders and the free trading. This could open up the door. I mean, the capital raising process through this, if you think about it, what do you do? A company raises money, they do it through an equity offering, that means they’re issuing more shares. Usually has to do it at a discount, and sometimes that stock will stay at those levels for a certain amount of time because you have dilution, you’re issuing more shares.
Frank Curzio: Or, you can raise money in the debt markets, not easy for GameStop and AMC a year ago, which had to pay super, super high rates, interest rates, because they’re not really generating any cashflow because their stocks are so depressed. So, what’s the alternative here? Look what they just did. You come, and you have a big name buy into your company. They came in at a little bit higher than the current price, which was fine, they knew it was going to take off because they saw the short positions and they’d have to cover, right? But even if you give them a 5%, 10% discount to your stock price, right? And then you allow these people to freely trade those shares, freely trade means no lockup period. In SPACs, they don’t even produce a lockup period, now they’re starting to produce a lockup and have to show how much warrants they’re giving away to people.
Frank Curzio: Now, you’re going to see how much these hedge funds actually made, they made an absolute fortune and most of them are out of the positions and SPACs, even though they told you the company they bought was the greatest thing in the world and you should go and hold it long-term. No. They got you, the retail investors bought it, and now, a lot of these things are getting wrecked, that’s what they do on Wall Street, retail investors, that’s what they do to you. And that’s why I love what Reddit’s doing to them right back.
Frank Curzio: But this could change the face of capital raising. I mean, think of our CEO token for Curzio Research, it gives you an equity stake in our business. Now, say we’re looking to raise money and I talk to Warren Buffett. Imagine that, that’d be great. And Warren Buffett says, “Okay, I’ll come in, the price of your token is around $7, I want to come in at 5.” Or you have Andreessen Horowitz, one of the largest venture guys, these guys are in everything, those guys come in. And I’m like, okay, fine, you’ve got freely traded shares, right? The price of our CEO token, once I make that announcement, is going to double almost immediately. Immediately, it’s going to go through the roof.
Frank Curzio: Now we raise… Say we raise 15 million dollars and we did it from a huge name, they could sell out whenever they want. Our stock is likely to hold most of its gains because we’re going to be sitting on a massive cash pile of 15 million where it’s going to allow us to market our products on every single media platform, compete with the biggest names in the industry, add tons of new names to our list and allow me to use that cash to acquire more lists, more names, and competitors. You’re looking at the way this was done, as much as people complain, it’s a win-win-win situation for almost everyone involved other than the people who were short, right?
Frank Curzio: So, if you’re looking at how this happened, you could see more capital raises go this route where, let’s get a big name, you can trade these shares whenever you want, and I know AMC did not know Mudrick was going to turn around and sell them a day or two later, I know that. But they didn’t care. It didn’t matter. You raise money and everyone wants you to raise money, and look where the stock is. That was $27, it’s 44 right now. Everybody’s happy, right?
Daniel Creech: Yeah, like I said, you’ve got to give the CEO credit because the hand that he’s dealt, he has turned it around and they’re making money and the stock is higher and at the end of the day, that’s really all people care about, again, other than if you’re short.
Frank Curzio: No, but that is really big news to the point that this is something that could really change the landscape of how you raise money. Just like security tokens did, we were able to raise money, it would’ve been very difficult for us to raise money if we’d said, “Hey, we’re just a private company and we’re going to go public whenever.” And smaller companies are able to do that and bypass the process through security tokens, but when you’re looking at how they did this, at first when I saw them, freely traded shares, that’s insane, right? Because they could actually just blow out of them.
Frank Curzio: But when you have a large short position on your company and you need to raise money, this is the best way to do it. I mean, you look at Goldman Sachs, what stopped Goldman Sachs from getting destroyed during the credit crisis? Warren Buffett’s investment.
Daniel Creech: Yeah.
Frank Curzio: And they practically gave that away for free, I mean, it was incredible, right? But that’s when they were like, “Okay, big deal, we gave Warren Buffett a gift.” Look what they got in return.
Daniel Creech: Right.
Frank Curzio: I mean, you look at what happened to Lehman Brothers, Bear Stearns, you took that kind of off the table but there’s something to be said about the way they raised money here that I think people, very smart people, are going to start exploring because this was a good idea, it’s a win-win for almost everyone involved except for the shorts, and I think you’re going to see this more going forward, so, we’ll see. But let’s get to a few more things here, Daniel. I know that you are really fired up about Exxon. Exxon in the news, where you had a hedge fund called Engine 1, it was able to get two board members elected, I think they still have a chance to get two more, they’re still counting, I don’t know if it happened yet, it could go up to four.
Frank Curzio: But Engine 1, this is a hedge fund that’s all about climate change, it’s going to result in Exxon changing their entire business model, business strategy, be more climate friendly. Which is kind of insane to me because you brought up some good points about how big Engine 1 and how big their position is, but they had some very, very big, powerful investors vote these people in.
Daniel Creech: Yeah, and so this came out last week, and I think the CEO of Exxon Mobil was pretty nervous, and he was on the phone trying to convince shareholders to vote for kind of the same old song and dance. But BlackRock, who we talked about a lot, the trillion, I don’t know, what are they up to, how many trillions of dollars in assets under management. But we talked about this a few months ago, is it Larry Fink? Why am I second guessing myself? He runs BlackRock, right?
Frank Curzio: Yes.
Daniel Creech: Because he was a CNBC interview and he was explaining how they’re not going to sit back and be idle anymore, and they’re going to use their power and their influence to help be more ESG, environmental, social, governance. So, what you have here is BlackRock funds are the second largest owner of Exxon Mobil. They’re the ones that backed the Engine 1 board of directors appointees and who got them elected basically. Engine 1 owns 0.02% of Exxon Mobil.
Frank Curzio: Yeah, it’s a 50 million dollar position.
Daniel Creech: They have about a 50 million dollar position. Now, don’t get me wrong, that’s a ton of money, but it’s nothing when you’re playing around with the amount of money in the hedge funds that you’re dealing with. So, what happens is now if you’re a CEO, especially if you have a target on your back, if you’re in oil and gas or natural resources of any kind other than clean energy, you have to pay attention to this and you had better take the card out of the AMC CEO playbook and start really communicating with your shareholders, because you need those huge asset managers like BlackRock. It helps stabilize your price. How long do you think BlackRock has held shares of Exxon Mobil? Several years, okay.
Frank Curzio: Yes. I mean, they only every single stock in the world.
Daniel Creech: Yeah, I mean, they own everything, but now you’re at a point where they can totally influence, I think it’s 25% of the board now, and like you said, I think they’re still tallying. They might get three. I think four is a little bit of a stretch, but I think there’s a tossup for the third one, meaning Engine 1 already got two appointees, they might get a third one. But so now, you’re CEO of Exxon Mobil, and you’re going to have to discuss this and, yeah, maybe they do some good things, maybe they help. It’s not hard to believe that there can be improvement, you can always do better. But as an individual investor, this is going to tell you to brace for higher oil prices.
Daniel Creech: Because now you’re going to have these guys go in there and say, “Hey, you need to get off this oil and gas, you need to cut production.” That’s going to give opportunity to other companies and it’s also going to cause higher prices in general in my opinion. So, that’s a big political tailwind for higher oil prices and, Frank, I’ve been talking about, we’ve been talking about this, we don’t have any oil exposure in CRA I don’t think. I’m thinking off the top of my head. But we’ve been kind of BSing behind the scenes about this and just seeing oil rally like crazy, and, yeah, I hope you guys have exposure to it. Devon Energy is a big fan of ours, an old CRA holding, but for the individual investor, expect higher oil prices and there’s no way, I think Goldman has an $80 price target for oil towards the end of the year.
Daniel Creech: I don’t know how it doesn’t go at least to 100 a year from now, I hope it doesn’t, because that’s going to hurt all of us. But at least you can make money and help offset higher prices at the pump.
Frank Curzio: Yeah, and also you had Shell, the Dutch court found that Shell’s partially responsible for climate change, ordered the company to sharply reduce its carbon emissions, and then you have the Exxon news with the activist investors. To me, I think this is insane. I really do. I mean, if I was Exxon, if I was Royal Dutch, if I was Chevron, if I was Pioneer, I’d give these climate people exactly what they want and stop producing oil at the same exact time. That’s what I would do. Really, for one year, just do it for one year, okay? Because you’re going to have gasoline prices at 10 bucks, oil’s going to be $350. You could say, “Hey, we’re green now, this is great, this is awesome,” so, let’s see if wind, solar, electric, whatever, if they can pick up the slack, which they haven’t yet and they can, they just, again, this isn’t base load power we’re talking about here, wind, solar.
Frank Curzio: But it’s getting nuts, and it’s getting nuts because when I look at the facts, it’s okay to believe in climate change without going stupid crazy, you’ve got to be careful with these people. The Al Gores, I get it, the whole thing was made up and it’s all for money, right? I get it, the guy made a fortune, right? I said earlier, Daniel, the guy purchased a seven, eight million dollar house in California which he predicted would be underwater in 2020, right? So, it won’t exist. But you got to be careful with the extremists here because they’re absolutely nuts. Because when you look at the facts here, 70% of US energy consumption is oil and natural gas. 70%.
Frank Curzio: Remember the days when natural gas, that used to be clean energy? Not sure when that changed but it’s kind of put in the same category as coal now, I don’t know why. Coal is another 10%. Then, you have nuclear around another 10%. So, you’re looking at 70%, 80%, 90% is oil, natural gas, coal, and nuclear. And then you have renewable energy, and I want to bring this up because I saw this chart here, which is really cool, and if you’re on our Curzio Research YouTube page, you could see it. Let me see if I can find it here.
Frank Curzio: Okay, there it is. And let me bring it up here. Okay, here it is. So, it shows the US primary energy consumption by energy source in 2020, and you look, and these are the numbers I just said right here, right? 34, 35, I mean, it’s really insane when you see some of these numbers. Look at renewable energy. Renewable energy is 12%, inside renewable energy, inside that 12%, it’s only 12%, 11% is solar, 22% is hydroelectric, 26% is wind, and then you have the biomass, that takes up a big part, which includes biofuels, wood, which is 18%, that surprised me, of biomass. But you’re looking at 12% renewable energy. So, I get it, we’re doing a pretty good job here, and it’s awesome, but we have to be very, very careful because if these guys just decide and say, “Hey, you know what? We’re done with this. Let’s stop producing oil.”
Frank Curzio: Which they won’t say, but if they did, what would happen? You’re going to see oil prices explode. I don’t think anyone out there realizes how much their bills, their personal wealth is going to decline the more we have clean energy in the system. And if it’s going to save the world and we had facts, it’s different, yes, we have to put money into it and I get it. But to the extremists where, hey, zero carbon emission by whatever, 2030. Come on, I mean, you’re out of your mind. And the fact that they’re influencing these big companies and dictating what they should do is absolutely insane.
Daniel Creech: Yeah, you need to pay attention to this, however, it’s all about the transition in my opinion. Like you said, you can’t stop producing oil right now because things would just get crazy. No doubt there’s going to be a lot of transition and how long that takes, who knows? But if you can get cleaner, more reliable energy than oil or natural gas, I’m all for it, depending on what’s the cost to society and the economy? Exxon Mobil though is knocking on the door of a 52-week high, so it’s up 1% today, it’s a little over $61. 52 week high is 63 and change.
Daniel Creech: So, the market is liking this, and this just goes to show you the momentum behind that whole ESG and green movement, so now you can gain exposure through that with Exxon Mobil. So, just something to pay attention to, and if you’re a believer that energy prices are going to continue to move higher like I am, then you ought to have exposure to both, either oil or natural gas, or clean energy either way. The world’s big enough for both, it just depends on how fast that transition and how hard they want to push for transition.
Frank Curzio: Yeah, just the fact, because you mentioned BlackRock, right? So, you’re looking at Engine 1 has a 50 million dollar position and obviously BlackRock has a bigger position than that, much bigger. BlackRock owns every single stock. Do you know how much their assets under management are right now?
Daniel Creech: No. Trillions.
Frank Curzio: 8.6 trillion dollars. So, you have these guys-
Daniel Creech: I was going to guess 10, so I’d have been over.
Frank Curzio: 8.6 trillion, I remember when it was 5 trillion like a year and a half ago, but I guess all the gains and everything. So, you’re looking at all this money that these guys have, and they’re backing this initiative. What that is going to change moving forward is the way people having voting rights, because sometimes the voting rights are structured for the insiders where one vote counts as 10 or 20 or 30, but if you’re going to have guys like BlackRock, because BlackRock now is a shareholder and if you want to give me one second here, Daniel, I’ll bring up my Capital IQ system because I am curious on this to see the percentage of Exxon they actually own.
Daniel Creech: What, BlackRock?
Frank Curzio: BlackRock, how much Exxon do they-
Daniel Creech: I think it’s between 6% and 7%.
Frank Curzio: Is it 6% to 7%?
Daniel Creech: But double check it, I think it’s 6 and change.
Frank Curzio: Yeah, so you’re looking at a company that owns 6% of this company, and, again, I’ll get that fact for you right now. But now you’re looking at BlackRock, BlackRock’s going to dictate, I mean, they have the power to dictate what every single company does because of their massive presence, because they can vote for whoever they want to. And that’s really, really scary. That’s a different, you know what I mean? That’s something that’s totally, totally different.
Daniel Creech: Now, in their defense, they did vote for the current CEO and stuff, but don’t think that they’re knocking on the table or saying, “Hey, pay attention to us, because we’re not going to be as idle as we have been in the past.”
Frank Curzio: Yeah, so it is 6.6%, and then Vanguard is another one who is huge, so this is a 6.7% number, Vanguard owns 8%. State Street owns 5%. These are guys, State Street, BlackRock, Vanguard, Fidelity, all the largest shareholders, they’re the largest shareholders of every company basically. But the fact that they have the power to vote and push some of this stuff in and all of them are really into… You have to kind of support that agenda. Now, you can bitch about it and complain and you don’t believe in climate change, but like you said, this means oil is going to surge, it’s going to go over 100, right?
Frank Curzio: If they’re pushing more into climate change, they’re going to produce less drilling and less supply is going to drive up prices. It’s going to result in a lot of companies seeing windfall profits, and that’s how you really have to position yourself. I mean, this ESG thing, whatever you think, if it’s BS or not, and I think most of us do believe in some form of climate change, not to the point where California was going to go underwater and go crazy and how the US is going to ruin the world even though I think it’s, what, 9% or 10% of the carbon emissions is from us so even if we cut it completely, if every other country decides not to, it’s not going to make a difference much.
Frank Curzio: But you have to invest accordingly, I mean, these guys are changing the boards on the biggest oil company in the world, the biggest companies in the world. They’re changing how they have their strategy and how they structure, and as an individual investor, pay attention. It doesn’t mean you have to agree with it, it doesn’t mean if you’re a Republican, you probably hate it. If you’re a Democrat, you’re like, “Yes, more green.” Whatever, that’s the initiatives. Forget about the initiatives, because the only thing you should care about is how do you make money? How do you become rich? How do you make your family better off, right?
Frank Curzio: That’s what your goal is, right? That’s what you should be caring about. If you do, this is how you have to play it, and oil’s going to go higher, natural gas too. We have practically an unlimited supply of natural gas, hundreds and hundreds and hundreds of years if we keep drilling deeper and deeper, but a lot of these prices are going to go higher as this green initiative gets pushed, and it’s going to continue to get pushed through this administration. So, you’ve got another two full years, I think, where you can make a lot, a lot of money on this trend and start buying these things as they pull back because money is being forced to go into these industries, it’s being forced.
Frank Curzio: You know this as well as I, Dan, because you look at a lot of quarterly reports, if you look at the transcripts, or if you look at the presentation on every website, they come out with their quarterly results every three months, and then you can listen to their quarterly conference call, and then they come out with a transcript. But they usually have a presentation there, a PowerPoint which shows slides. Every company in the S&P 500 has dedicated at least 20% of those slides, so it’s like three, four, five pages to ESG and what they’re doing, every single company right now.
Frank Curzio: Every company, and it was never in there before Biden got elected, now every single company is like, “We have to put something with ESG, what are we doing about the climate? That’s what people care about, we need to do that.” And again, they don’t really care about the climate, they just care about the sentiment behind it, and they know they have to do it. If they don’t, they could get in trouble, but you have to invest accordingly, right?
Daniel Creech: Yeah, absolutely, I mean, you can make money off higher prices, so it’s not time to panic, we’re not saying that, it’s just that’s a big change and if you have these large holders start to throw their weight around, that’s something that you have to take note of. Because that’s going to give individual investors a lot of opportunity. Speaking of the environment and what’s good for it, can we talk about the biggest Bitcoin bash about to kick off?
Frank Curzio: Yeah, I know, I was going to go to-
Daniel Creech: Are we going to Miami? Do we have a Curzio One jet yet to fly to Miami?
Frank Curzio: Not yet, not yet. I just need a couple of you listening this to subscribe to a few more newsletters. And then, I’ll have a jet.
Daniel Creech: That’s awesome.
Frank Curzio: And I’ll send you pictures from the jet. I promise. Isn’t that messed up? Everyone’s probably going to cancel their subscription with me saying that. But obviously, I’m joking. But I was going to go to the conference, it’s been really crazy on my end, but I’m kind of glad I’m not going. It’s pure, 100% Bitcoin, it’s not like you’re going to find alt coin ideas and stuff like that, it’s just a Bitcoin bash, and I talked to a couple of people who are going to be there. And also, we interviewed a lot of people on this podcast that are there and really some high profile names, just great people.
Daniel Creech: I’m sorry.
Frank Curzio: No, go ahead.
Daniel Creech: I’ve got to bug you here, because if you go to the Bitcoin conference webpage, former, is it Senator? Ron Paul?
Frank Curzio: Mm-hmm.
Daniel Creech: Rand Paul is his son.
Frank Curzio: Yeah.
Daniel Creech: Ron Paul is speaking. Michael Saylor, who is MicroStrategy’s CEO. Jack Dorsey of Twitter there. Tony Hawk.
Frank Curzio: Yeah, Tony Hawk is there.
Daniel Creech: I didn’t know he’s a big, obviously he’s a Bitcoin fan or advocate or whatever? I just remember Tony Hawk, that was the PlayStation game when he came out with his skateboard.
Frank Curzio: He might be a member of the Bitcoin crowd.
Daniel Creech: I mean, I grew up watching him in the X Games, and I can’t skateboard and he didn’t inspire me that much. I wasn’t going to go and break my neck, but I loved watching the guy, he’s probably the greatest of all time.
Frank Curzio: Yeah, both of my daughters love to skateboard, but he’s the demographic, right?
Daniel Creech: Yeah.
Frank Curzio: He’s perfect, and he has a massive, massive following, he’s still young, and that’s the Bitcoin crowd. The 25, 35, under 40 crowd.
Daniel Creech: And Bobby Lee’s going to speak there.
Frank Curzio: Is he? I didn’t know that.
Daniel Creech: I think I saw his name on there. I hope he does because I really enjoyed listening to him a couple of weeks ago.
Frank Curzio: Dan Held is going to be there as well. We interviewed him. Yeah, there’s a lot of people that we’ve interviewed that are going to be-
Daniel Creech: I read yesterday they were expecting over 50,000 people. That’s incredible.
Frank Curzio: Yeah, I think they only took 12,000 people as invitees for attendance. But when you have everyone, the companies involved and all the guests and everything, it’s going to be really insane. To me, I said to a couple of people I was going to go there, I’m interested to see what the sentiment is going to be. I even tweeted it. They’re like, “This is your worst tweet, what are you talking about? Sentiment’s great, we’re going to hold on for dear life.” And I’m like, I’ve got to tell you, man, I get it. I get the religion behind shit. I do because I deal with analysts like that and sometimes I make fun of them because they have something in their head for the last 25 years, and no matter what changes, they’re going to say, “Nope, this is what you’ve got to do,” right? I get it.
Frank Curzio: But you just saw your investment, you just saw your investment, I mean, what do you invest for? You invest to make money, right? So, you should say, “Okay, how much do I want to make on this, is this is an income investment?” But there should be either a target or something that’s going to make you sell it one day. I mean, not everything turns out to be Microsoft and Amazon, you hold it forever, right? And those thesis, again, you can hold those forever with everything that they’ve got into. But when it comes to Bitcoin, I look at these guys and your stake that you bought in 2011, ’12, ’13, whatever, went all the way up to, say, five or even 10 million dollars some of these guys like Bobby Lee and a lot of the other guys.
Frank Curzio: And in four weeks, that 10 million is five and a half million. That’s got to hurt a little bit, right?
Daniel Creech: Absolutely, yeah.
Frank Curzio: I mean, for you to say, “I’m holding on for dear life.” That is not an easy thing to do. And there’s been corrections, 70% plus corrections on the way, all the way up, since 2011 there’s been three of them, and this is the fourth one that’s only been about 40 something percent. So, people think it could test a 20,000, 22,000 level from a technical perspective. I don’t know, but what I do know is it’s here, it’s adopted, you’re going to see more institutions get into it, especially blockchain. A lot of technologies are coming out. We just recommended a new stock you guys are going to get today, it’s fantastic, in our Crypto Intelligence newsletter, which we did a great managing this downturn, taking small positions and then adding to them a few weeks ago, and that’s how you have to invest in this industry where you’re not getting killed at once.
Frank Curzio: But if people say, “I’m going to hold on forever,” or hold on for something forever. I just think that could be a dangerous investment strategy. Then again, I would look like an idiot, because I would’ve said that when Bitcoin was at 12,000 and hit 19,000 as a high, whenever that was, 2017.
Daniel Creech: Yep.
Frank Curzio: So, again, maybe they’re right, maybe it goes to 100,000, maybe it goes to 200,000, I don’t know. But I do know if I saw my network, and a lot of these guys who are in Bitcoin, all their net worth, at least 80%, 90% is tied up in one asset class. When that comes down 40%, 50%, you have to wonder… You’ve got to be a little worried I would think, right?
Daniel Creech: It definitely has to hurt, but I don’t know Bobby Lee other than just listening to your interview, but Dan Held’s the same way. A lot of those guys I have no problem believing that they are going to hold as long as they say because they genuinely believe in the concept, they believe in the idea, they believe in the freedom behind it and opportunity that presents. But, yeah, if you just join the crowd and say, “I’m going to hold forever,” what’s crazy to me is that Bitcoin is around 38,000 right now. This thing kicks off tomorrow for the Whale Pass, and then Thursday the 4th, Friday, continues on with all the speakers and things.
Daniel Creech: I want to see if the sponsors outperform Bitcoin over the next four or five days during this. It wouldn’t shock me if Bitcoin goes up with all this. And then, we’ll see if it pulls back, but you’ve got everybody, basically everybody in the game is sponsoring or covering this thing. So, Binance is no doubt going to do well off of this and the exposure.
Frank Curzio: You look at the sponsors on there, it’s over 100.
Daniel Creech: Coinbase, obviously. Even regular stocks like Microsoft is sponsoring some of this. Of course, your Krakens, your Gemini, the crypto exchanges. So, that’s going to be interesting on my end to see, hey, over the next four or five days what’s really getting more? Because they’re going to have signs up, Binance US has a presence there, and that’s kind of what has my attention. Bitcoin is going to fluctuate anyway, but it’s hard to believe for me, it’s not going to go to 40, that’s only $2,000. Hell, that could happen by the time we’re done.
Frank Curzio: Yeah, and, guys, just think of Coinbase too, and this is when I come to Crypto Intelligence, Coinbase and you have a lot of companies like Silvergate Capitals, Voyager Digitals, Galaxy, names I’m giving away that we’re up on or whatever, I don’t want to give away too much of our newsletter. But investment fees, brokerage, I mean, the volume and the liquidity is incredible, and even though this thing has come down. We saw Coinbase go from, I don’t know if it was 400, I forget, but it went down 210, 215.
Frank Curzio: We add it to our position in that. We’re only down a few percentage points, but you’re going to see earnings explode, absolutely explode. They exploded last quarter with Bitcoin going up, but the amount of trading and the amount of volume, again, that’s all great for these brokerage firms and investment bankers where, yeah, you’re seeing these shitcoins go down and stuff. But these guys are real companies that are going to generate massive amounts of money, even Binance and stuff, not that the tokens are a pure reflection of that, the Binance token.
Frank Curzio: And I have to give it to them, I’m not just agreeing with them, you’re holding on for dear life, what I’m saying is that when I look at a company and what makes sense from their point of view is say if I want to buy IMAX, and I bought IMAX a long, long time ago I recommended it, and it was because of the 3D revolution, and it’s going to be movies, and they did a great job, right? And then that thesis came to fruition. You look at Zoom video conferencing, right? Especially during COVID, they just reported earnings, blogged the numbers, but yet, you’re going to have more people going back to work, you don’t need as much video conferencing, so your thesis played out.
Frank Curzio: The thesis behind Bitcoin, and I don’t care what people say, if you think it’s a store of value, if you think it’s a hedge against inflation, whatever you think, it all comes under one umbrella, right? Is that the government is going to continue to destroy the dollar and governments around the world are going to continue to print money, right? And you can factor that down into whatever underneath that is the reason why, but that thesis that they’re buying in is never, ever going to change. That’s one of the things I have to give to them, because that thesis that you’re buying, because everyone’s buying Bitcoin because of that, you could filter it down and say, “Well, it’s a store of value,” like Michael Saylor say, or it’s a hedge against inflation, which it’s not really as we saw in the past couple of months.
Frank Curzio: Whatever it is, or alternative currency, whatever, it all falls under that this is going to work because the governments are a bunch of idiots, and they’re going to continue to just print money recklessly, and that ain’t changing anytime soon, especially in a market right now, where we’re seeing massive inflation and the government is like, “It’s transitory, we’re going to be fine.” And that’s one thing I got to give them, right?
Daniel Creech: Yeah, I mean, one of the easiest investing lessons, and I’m having a little bit of a blank here, I think it was Buffett, or maybe it was Munger, but anyway, somebody that’s very successful and very good. Hey, when your thesis doesn’t change, then you shouldn’t sell. If your idea thesis is still intact, why would you sell out of your investment? And to your point, that’s the easiest trade there is, because the tailwinds that are driving Bitcoin mindset and the reason people like that, which you just covered, those aren’t changing anytime soon. World governments are going to continue to print money, et cetera, et cetera.
Daniel Creech: So, that’s the easiest thing, hey, buy it, forget about it and you’re good to go. And so far you’ve been proven right. Unless you bought at the absolute top a couple of weeks ago, you’re still up.
Frank Curzio: Yeah, you’re still up, you’re still doing good, and it’s approaching 40 now too, so you might see a little bit of a bump too with the conference and everyone’s going to be covering it and the excitement. Kind of like when Coinbase came out, Coinbase came out at the perfect time. You had Bitcoin all-time highs, everything was Bitcoin, everybody was talking about it, then they reported earnings early to show how great their numbers were. You’ve got to give it to Coinbase coming out when they did, and the stock’s down a little bit from that price now, but that was kind of cool. So, great stuff.
Daniel Creech: If you’re interested, last thing, just Google the Miami Bitcoin 2021, it takes you to their webpage and it looks like you can just subscribe, everybody can subscribe, for email updates. So, if you want to get your information sold and get spammed by everybody else you can do that as well, or you can just wait and listen to us next week.
Frank Curzio: Yeah, and it’s kind of cool because I have a lot of people sending me notes. And again, I think Thursday, there’s a couple of parties and stuff but Friday and Saturday are the main days of the conference, and it’s going to be really, really crazy down there with the amount of people. And, yeah, I’m looking forward to just hearing from you and your emails and stuff. A lot of people have some great sources within this industry, that’s helped me tremendously with Crypto Intelligence and finding new ideas, so I really, really appreciate the amount of people that email and come in.
Frank Curzio: So, have fun at that conference, it should be really, really cool, we’ll talk more about it because I’m going to get a lot more details from my insiders, which is really, really cool, over the next couple of days, and we’ll talk about this next week, Daniel. So, Dan, thanks so much for coming on. Really quick, we always talk about Dollar Stock Club, and the reason why I think this is one of the best products we have here is a lot of stuff that we talked about, Daniel, even with oil, for me, I always look at things that I miss. We have good performances across a lot of the newsletters, and finding new ideas, but still, for me, I want to have every great idea, right?
Frank Curzio: I’m competitive, I love my job, I want to be perfect at it. But I missed oil, and yet, we’ve had guests come on this podcast that I interviewed that gave us oil recommendations. And every week, we take a pick from one of our guests. We don’t have a guest this week which means that Daniel Creech, you’re making the pick this week.
Daniel Creech: I get a pick? All right.
Frank Curzio: You get to pick, and if you’re wrong, what’s your email address?
Daniel Creech: I’ll be ridiculed.
Frank Curzio: Daniel@curzioresearch.com, you can email him, be all over him, but the pressure’s on, Daniel. But the point of this is we get some really great ideas outside of just what we talk about, and that’s where the value comes in. And it’s incredible, and we actually keep track of this through our Dollar Stock Club portfolio, we’ll take one of their ideas and they’ll mention five or six, they might mention them offline because I talk to our guests before the interview and after the interview, and we’ll take that pick and write a one page report and say, hey, this is why they like it, we like it here. And we’ll have a buy-up-to-price on it.
Frank Curzio: But some of the investments that we’ve made from our guests, it also allows me to really track who’s good and who’s not, because if someone comes on and gives you five bad picks over a year and a half timeframe then I’m not going to have them on. I don’t want to put them in front of you anymore. So, the track record has been really good lately, we’ve gotten into so many different ideas. You can get any kind of idea in this newsletter, from cryptocurrencies to shorting positions to every single sector is wide open with every single stock, and we’ve done a good job finding really cool ideas. And, Dan, you’re a big part of that newsletter, and you write a lot of that, and we talk about it a lot.
Frank Curzio: But for that, it’s a product that I’m proud of because I don’t see that product can be duplicated anyplace, where you’re able to get picks from some of the greatest investors out there that we’re interviewing, and it only costs you a dollar a week, and that’s why we call it the Dollar Stock Club. So, Daniel, I just want to say, thanks so much for doing that, I don’t know if you wanted to add a little bit to that because for me, I’m always learning from my guests, and it allows me to put a lot of these things that I’m learning in front of you, and the things that I may not recommend or I might not see in certain sectors and stuff like that. But I don’t know if you wanted to add to that?
Daniel Creech: No, that’s pretty much it, you did a good job there. Just look at it as an idea generator, I mean, different guests are going to be drawn to or interested in different topics, different sectors. You get somebody else’s opinions and beliefs on everything. So, we always just try to capture something there and put it in the portfolio. Some of them are quicker trades than others, some of them have just taken off and, again, when your thesis is still intact, you just let it ride.
Daniel Creech: So, yeah, we’ve gotten some big winners during the bull market, we’ve seen a lot of volatility, but it’s an easy introduction newsletter and, yeah, that’s pretty much it for, what did you say? A buck?
Frank Curzio: Yeah, so, it’s $4 for the month. I have to say, most people that subscribe to it, that’s kind of like an introductory newsletter so you see what our research is all about and then you listen to the podcast and then you hear about our other products and stuff. But most people that come in pretty much just go on auto, because they’re always getting new ideas, new ideas, new ideas, almost every single week, not often it’s two weeks, sometimes we have influencers on. But it’s over 40 picks, 45 picks a year, and we make it very easy for you to cancel if you want.
Frank Curzio: So, if you want to subscribe, you can go to our website, again, it’s for that price and the amount of ideas that you’re getting, I don’t see any other newsletter out there that’s like that. I don’t think anyone could duplicate it because the context that we have and the people that are coming on our podcast because of you and how many listeners we have, it’s really, really cool and just getting those unique ideas constantly every single week is awesome. And that’s why a lot of people rarely cancel once they’re on. And if you want to cancel, it’s two seconds, it’s just you cancel, it’s not like we put you through this whole website, you’ve got to go here, here, here.
Frank Curzio: Which, I hate when I want to cancel something. No, it’s not like that. If you don’t want it, you don’t want it, it’s cool. But if you do, it’s $4 a month which is really nothing, and you can find that offer on our website, curzioresearch.com, and I think that’s it, Daniel, I think we’re done for today, right?
Daniel Creech: All right, perfect. Cheers, everyone, have a good week.
Frank Curzio: Yeah, I should do a quick, okay, bye. But being serious, guys, listen, I always say this but I mean it, I have to keep saying it every podcast, that I really appreciate all your support. It just blows my mind how many people actually listen to this and actually are watching on our Curzio Research YouTube page as well. So, I really, really appreciate it, I love what I do, work hard, try to find ideas, take it very serious because I know my employees buy my ideas, my family buys my ideas, my subscribers buy the ideas. So, when I’m wrong, I’m pissed.
Frank Curzio: So, putting in that effort and everything, that’s something I’m going to continue to do and not stop. And I love what I do, and thank you for making that possible for everyone listening, so I just want to say thanks. And as always, I’ll see you in seven day. 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.