Kiersten Crum was in college when the COVID-19 pandemic struck. After her campus shut down, she moved home and began working at a grocery store…
Today, she’s a successful investor, trader, and financial influencer on TikTok.
Kiersten shares her inspiring story and why she’s passionate about educating young investors. She also explains her methodology for finding great ideas in the market… and how she balances long-term investing with day trading. [33:50]
The latest inflation statistics were released today. As inflation continues to move higher across the board, Daniel and I explain why you shouldn’t trust the Fed to do the right thing. We also discuss the Colonial Pipeline shutdown… and the market’s wild volatility. [57:01]
Today’s episode of Wall Street Unplugged is sponsored by Blockchain.com… one of the most trusted cryptocurrency platforms in the world, with over $800 billion in transactions since 2011.
Not only can you trade your favorite cryptos… you can earn up to 13% interest annually on digital assets like bitcoin, ethereum, and USD Tether.
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- Guest: Kiersten Crumb, financial influencer [33:50]
- Educational: Why you shouldn’t trust the Fed with inflation [57:01]
Wall Street Unplugged | 772
Don’t trust the Fed to stop inflation
Announcer: Wall Street Unplugged looks beyond the regular headlines heard on mainstream financial media, to bring you unscripted interviews and breaking commentary direct from Wall Street, right to you on main street.
Frank Curzio: What’s going on out there? It’s May 12th. I’m Frank Curzio, host of the Wall Street Unplugged Podcast, where I break the headlines and tell you what’s really moving these markets. I had an interesting weekend. My car… I have a Lincoln Navigator, the nicest car I’ve ever bought in my life. Really, really cool. It’s a 2018, and we leased it and the lease is up next month. So I figured, on Saturday, we’ll take the day, got a babysitter, went out to the dealership, see what our options are, and maybe get a newer version.
Frank Curzio: We drove all the way out there to Jacksonville and there was nobody in these shops, which was a little weird when you think about it, right? You think… Used cars are really going through the roof. We saw that in the CPI data. I’ll cover that in a minute. People are buying cars like crazy, but there’s a reason why they’re buying used cars. I’m going to tell you right now: Because there was nothing available. Not to mention, the 2021 Lincoln Navigator, if you sat in it, you wouldn’t know the difference between 2018, 2019, 2020. It’s the same exact thing.
Frank Curzio: But they only had three on the entire lot, only three. And two of them, they were longer versions, which the wife and I didn’t want. And the other was a Black Label, which is one of their top lines, but it had features that we would never get. It had a gaming system in the back seat. You don’t need that anymore; kids have iPads. If have young kids, you want to have something. Believe me, if you’re going on long trips, which we do a lot, with my daughter, both of my daughters, with sports and stuff like that.
Frank Curzio: And it was an off-white color with black and white interior. And when you’re buying a new car, especially if you’re buying a new car that you’re going to pay premium price, you want to have it to your own specs, right? If you’re going to pay a lot of money, you want it to be exactly what you like within the car. And now you can build your own cars on all these sites, which is pretty easy. You just go to that site, build it, you can get your own specs and it’s designed perfectly for you, and it’s awesome.
Frank Curzio: But if you did that on their website and said, “Hey, this is the car I want.” Six months, it’s going to take you six months to get it. Think about that for a minute. They say, “No, it’s after four months.” I mean, it’s going to be at least six months, maybe even longer. So, if you’re looking on the lots, there’s not a lot of cars on a lots. There’s nobody in these places. They’re not selling anything. I tried to look to see if they had 2019 or a 2020 or anything. Nothing, they had nothing.
Frank Curzio: There’s a Cadillac dealer across the street, I said, “All right, you know what? Let’s go across the street.” By the way, this car is for my wife. My wife is the most non-materialistic person. Every time I take her out, I try to buy her something nice, she always spends the money on the kids or whatever. And I’m like, “Just spend the money on yourself, have fun or whatever.” So, we decided to get a nice car. Right? So, we’re looking to get a nice car. For me, I’m a Southerner, I drive a pickup truck now, which is awesome. I love it.”’
Frank Curzio: But we went into the shop and I said, “You know what? Let me test an Escalade. I’ve never tested an Escalade before.” There was none on the lot to test. You couldn’t test. You couldn’t drive it, none on the lot. The dealer said, “There’s three coming in. We ordered three and in about four weeks, there’ll be here. Maybe in four weeks.” He said. Which probably means about six to eight weeks. So, I said, “What are the specs on them?” They were all ugly colors.
Frank Curzio: Okay, you want to get a car, you could build it if you got to pay a lot of money for a car, you want the car you want. And yeah, they had three of them coming in and none of them were anything we would have bought. One of them, was super crazy expensive. We were like, “No way, we don’t want that one.” But it was amazing because when I said, “Okay, if we build our own, what’s the earliest that we can get this?” And they said the same thing, “Over four months, definitely over four months. The chip shortage is killing us.” No one in the Cadillac dealer at all, no customers at all in these places.
Frank Curzio: And think about it, you’re going to get a car, you want it to be in your favorite color, at least, right? So, you don’t want to have to buy and settle for what they have on a lot, but you’re going to have to do that. And you’ve got to have to hope, that they actually have a car on a lot. And our lease is up, right? So, our lease is actually up, so we need to do something. So, we tried to look at the Suburban at Chevy. Zero, zero on the lot. So, this is three different dealerships, zero. They had two Tahoe’s, which was my old car and I wasn’t too crazy about it. I had problems with it. So, I didn’t like it. But they said, “Easily over four months, if you order today.” And they really had nothing. So, these lots are half empty. Think about that?
Frank Curzio: When have you gone to a car lot and seen it half empty? Not used cars, used cars, they’re selling, there’s a reason. Here’s the reason. Because you can’t really buy a new car today, unless you want to wait six months. And a lot of people can’t wait six months, especially if they’re coming off of a lease. But if you want to buy a car, you want it right away, that’s what you want. That’s important. But when you look at the bigger picture here, these guys have no inventory on their lots and again, I never saw that before. Always see a ton of cars on these lots, they aren’t selling any cars and you’re at least two quarters out from this problem getting fixed.
Frank Curzio: So, what happens if you own Ford or GM? And I got a question on this about a month ago. We’ve seen chip shortages for two months now. I said, “You know what? These sales, they’re going to be delayed.” So, you might see these stocks get hit. They’re taking charges. Their plants are closed. All these dealers said that, “Their plants are actually closed. They’re idle, because why am I going to pay workers and give them money when we don’t even have anything to build. And we can’t build them because of the chips.”
Frank Curzio: If you’re looking at them and now that I went to these dealerships, I mean the next two quarters are going to be absolutely horrible for these guys. I mean, I didn’t think it was this bad. I was thinking, “Well, maybe you could buy Ford or GM on a pullback.” I see this all the time with companies because it’s all manipulation anyway, these earnings, legal manipulation. But it’s not that, if you sign big orders in Q1, you could push them out in Q2, Q3, Q4 to make sure you make your numbers. Right?
Frank Curzio: It’s all the games, it’s all the accountants. That’s why we have quarterly earnings and not six months of earnings. And I get it, everybody needs to make money along the line. But these orders are not going to be delayed. I’ve always seen it as a buying opportunity saying, “Eventually these orders are going to come back. And so, when the stock comes down, it’s a buying opportunity.” These orders may not come back in.
Frank Curzio: Take me, for example, I’m probably going to purchase the Navigator, the 2018 that I have now. And after I purchase it, I’ll trade it in for something else. I’ll use the equity that’s in the car, to trade it in. Or, I may just give it back and say, “Okay, I’m going to buy a used car for now.” And again, I’ll use that as equity to purchase a nice car, maybe six months from now, eight months from now. I don’t know a year from now, I have no idea. But people aren’t buying things and saying, “Okay, I’ll receive it in six months and I’m cool.” They’re walking away. So, these aren’t delayed orders. These orders may never happen.
Frank Curzio: So, how has Ford and GM going to make their quarter? When you think about it, it’s probably good for Tesla. I know, you have skepticism about Tesla. I don’t really, I always say, “Never, ever short Tesla, ever short Tesla.” But I did go on the site. I’ll explain why in a minute, why you should never short Tesla. But I went on their site just to see, I’m not going to buy a Tesla. I can’t even fit in them yet, if they have a truck, which they say is coming out, maybe. But it’s hard to go from a truck to a sedan, when I’m driving a truck for so long.
Frank Curzio: But it takes about two to three months to get that car, if you build it online, it’s a lot shorter compared to maybe five, six months, we don’t know. This is two, three months. But think about this, because this was the year guys, this was a year that all these companies, all the automakers were going to catch up to Tesla. They’re all releasing new electric vehicles, it was all coming out. Tesla, better watch out, the competition is here. Well, no longer. None of these are on lots. None of them were being built.
Frank Curzio: I mean, it’s going to be another year that Tesla has this market to themselves, basically. You try to buy an electric car outside of a Tesla. Good luck. You’re not getting it for nine months, no way. That’s a pretty big deal. Think about new cars, models, whatever. The market shares increasing, while it’s taking a big risk off the table. I’m not telling you to buy a Tesla. Again, Tesla right now, is the only game in town, when it comes to EVs, pretty much. And I usually stay away from the stock. Again, I never told you to short it because it’s a cult. To bet on Elon Musk, people will die for. I’m not even kidding, people actually die for this guy. I’m not exaggerating.
Frank Curzio: If want proof, my wife’s friend is buying a Tesla. She said, “I’m getting it in two weeks.” She told me, I’m quoting her, she told me. She’s like, “I can’t wait. I’m so excited. This is a life-changing event for me.” Think about that for a minute. A life changing event, you’re buying a fricking car. It’s a life-changing event. You have a kid, it’s a life-changing event. Getting married is a life changing event. You’re buying a car. Life changing? That’s how they get, that’s common. That’s common. That’s what Tesla’s about, that’s what the stock is about. That’s dovish coin is about, I mean, I can play it because I’m into the crypto industry. And I love the crypto industry, and I feel like this is a BS coin.
Frank Curzio: But it’s more than that, dovish, it’s a lot more than that. When you see Doge and Tesla both be called fraud by so many people, smart people, but it doesn’t matter. I mean, fundamentals don’t matter with these things. They’re cult names that are being bought by a new generation of investors and these people refuse to sell. They’re holding on forever. They don’t care about volatility. Right? They’re holding forever. And the more that people trash these names and call them frauds, the more the younger generation wants to buy them.
Frank Curzio: Why? Because to them, they’re looking at it as an F-you to the system, to the destruction of the dollar, to Wall Street, “Hey, we’re here. This is what we could do.” It’s incredibly, incredibly powerful. Look at GameStop. It’s $150 a share, still. Yes, it went to 400, this thing should be in the single digits. It’s a $10 billion market cap with basically, no business model, other than selling games through stores. Okay? I like that, but most games you don’t buy offline anymore. You can download anything. Look at the new Sony PlayStation, they have two versions.
Frank Curzio: One of them is, you could still use a disc for the PlayStation 4 and stuff and 5, but they have the other version which is really selling. That’s just, you download only. What do you think the next versions are going to be? Download only. Yeah, they raise money, they have cash and they’re going to try to get into online and stuff like that, but really no business model. This is the cult, of how many people buy these things? When it comes to Tesla, listen, competition was one risk, that’s off the table, there’s no competition this year. You don’t think they’re going to meet demand? Well, they’re probably going to meet demand, they’re probably going to surge. You’re going to see a lot of people say, “You know what? I’m going to buy a Tesla now.” Especially if you can get it in two or three months, because it’s the only game in town, other than buying used cars.
Frank Curzio: I’m seeing this here. I’m seeing this through emails. So, I want to hear from you at firstname.lastname@example.org, especially if you’re a car dealer, I want to hear from you. And there’s several that emailed me three months ago, three months ago, and showed me letters from their suppliers saying, “We’re not going to be able to deliver this for a very long time.” And in two months though, it started, the chip shortage and now, it was like, “Wow, look at the chip shortages, it’s crazy.” But getting back to the shortage and there’s a ton of companies that are being impacted right now, where you have to expect to, they’re going to take a hit on earnings and sales in the coming quarters, maybe not this quarter.
Frank Curzio: Went to Best Buy, and I took pictures of it and posted on my Twitter, @FrankCurzio. I mean, the first time that I’ve ever seen shelves empty, shelves were empty in Best Buy. When have you seen that? They have nothing in stock. Said, When’s the last time you got the PlayStation 5?” They said, “Thanksgiving, Black Friday.” And people aren’t ordering it. You can’t go there and say, “Hey, I’m ordering it, when you get one.” No, they walk away. They try to get it someplace else, which is bad for Best Buy. You’re not buying it at these stores. You’re trying to get it someplace else, which the only place you could probably get it right now is eBay and offsites and you’re going to have to pay double for it. There’s no supply. No supply of anything out, there these days. It’s crazy.
Frank Curzio: But if you’ve got people going into these stores, it’s not, “Hey, you know what? I’ll buy this later.” No, they just, “All right. Let me find other alternatives.” It’s going to hurt a lot of companies. I mean, it’s crazy when you think about it, because the multiples on so many of these names, I mean, they’re priced for perfection. Yeah. We’re seeing names get hit and some growth names and a couple of technology names, but a lot of names are still at their all-time highs. The S&P 500 and the Dow are close. They hit all-time highs this week. Yes. They pulled off the VIX, is going higher, I get it. But they’re near all-time highs. They’re trading at crazy multiples.
Frank Curzio: I get it, but we’re far from perfection. Sure, you can say, “Well, Frank, you got low rates, you’ve got trillions of stimulus, you got Fed buy.” I get it. But did you see the CPI number from today? Up 4.2%, of course, much higher than estimates. I mean, how is this number actually higher than estimates? If you look at economists, they have to stop hanging out with rich people and rich crowds, looking at bell curves and studying things in the past. I mean, you look at all the indicators, right? All those indicators, almost all of them, which are lagging indicators, which look at last month and then they get revised three different times.
Frank Curzio: So, if you want to know what’s happening now, you have a better indication then economists because you are in the real world. We’re in the real world. We see what prices are going higher. We see a house prices, other people, that their house is being sold for more money. They’re like, “Holy cow, I can’t believe how much they sold for across the street. My house is bigger than that. Oh, it’s going to be worth more.” You’re seeing it everywhere. You’re seeing it in food prices, electricity prices, lumber, everything across the board. How is this number higher than estimates? And did they not see this coming? Because inflation is already here. It’s been here and now it’s showing up in a gauge that the Fed creates, almost always show no inflation, no matter what, excludes food and energy.
Frank Curzio: But inside those numbers, one of the biggest things was used cars. Used cars, rose 10%. Used car prices, 10%. Why? There’s no cars on a lots, none are being shipped for four to six months. I’m going to be forced to do the same thing and buy a used car. And since this has happening in four to six months and we have the CPI come out every single month, where do you think the CPI is going to be in the coming months? Because used cars was the biggest component. You saw food prices rise. You saw gasoline prices. We’ll talk about that later with Daniel, are rising. All commodities are rising. We saw the normal rises, but now a big rise in used cars. But if you can’t get cars for the next four to six months, where do you think this is going to come from?
Frank Curzio: What do you think is going to happen with these prices? It’s going to go higher and higher and higher and CPI. I don’t know if they’re going to, these economists, where it beats estimates, it’s taking a bunch of economists from sell side analysts and saying, “Okay, here’s the number. This is what we think. Here’s the average, the mean, and whatever.” And it blew it out. That used car component is going to continue to go higher and higher and higher because there’s no inventory in cars. People have to buy used cars instead. I know two people, where I am in Florida, who sell used cars. And they’re on fire for the last three years, on fire. They’re like, “Holy cow. I’ve never seen anything like this.”
Frank Curzio: It’s kind of like real estate. There’s more real estate agents than actual homes for sale. So, what do we have? Commodities are surging, we all see it. Home prices are surging. One month supply in the market. There’s usually, a four to six months’ supply on average, probably five, I would say five and a half, maybe on average. It’s one month. Home builders have to build, there’s no homes. What do you think are going to happen to prices? I know your price has gone up tremendously. The price of my home has gone up tremendously. It’s going to go up a lot, lot, lot more. There’s no supply, simple economics.
Frank Curzio: You can’t say, “Well, things are getting crazy right now. It’s going higher.” No. Why is it going higher? Because there’s no supply for the last year. There’s no supply six months ago and there’s even less supply now. Where do you think prices are going to go, until we have more supply in the market? Which is going to take at least six months to a year, minimum, home prices are going to surge. If you’re in the right areas like Texas, Florida, no income tax states. You saw the population for California, declined for the first time since the 1700s. Why do you think that’s happening? Going to happen to New York, as well. Because of fueling home prices, definitely across the country, but in certain areas, it’s going to be even crazier.
Frank Curzio: Wages are starting to surge, just saw a terrible unemployment number on Friday, where the actual rate, the rate rose, went from 6% to 6.1%. And if you watched CNBC that day, they had all these economists on, they have a bunch of windows, like 8, 10 windows. I know a lot of those people, some of them I’ve interviewed on this podcast, I respect them a lot. They were all clueless. They had no idea what was going on. They’re like, “How could this number go up. There’s no way. How could this number go up?” They were factoring 2 million, a million and a half. They go through all their estimates, right before. A million and a half, 2 million, whatever, they had 233,000 or something, jobs. And then when I went to Steve Liesman, when the number was reported, they’re like, “Where is the report?”
Frank Curzio: And he’s like, “Wait a minute.” And he couldn’t find it for three minutes. I think he found it, but he couldn’t believe it. That the average was only 233 and that the unemployment rate went up and then Santelli got on and said, “This is the number. Here it is. It’s right here.” And they were just like, “I don’t know, this is a temporary average.” It’s not temporary. These economists, they don’t go out into the real world. They’re like you were me. They don’t go to bars and hang out. They go to rich circles and everybody’s rich. I’m not putting them down. They’re smart people, but man, they have no clue. They have no clue what’s going on right now. Just go outside, that’s all you need to do. Try to go to a restaurant, a bar or retail outlet.
Frank Curzio: There’s a sign on almost every store, “Having trouble finding employees. We’re short short-staffed. We’re closing early. We need help.” Why is this happening? Because people are making more money staying home than working. It’s that simple. If you want the numbers behind it, it’s $32,000. That’s the number. Two different firms came out with that number, $32,000. Okay? That’s the amount. So, if you’re making less than that, you could stay home and make more money through benefits, than you can through working. And I don’t blame these people for staying home.
Frank Curzio: Think about how much you make right now? And someone said, “I’m going to pay you exactly the same, but you could stay home.” Would you do it? Oh, of course, you’re going to do it. I’d like to spend more time with my family. I’d like to be in my pool. I love what I do, but if I’m going to make just as much, staying home and having fun and you can play video games and hang out and do whatever you want, people are going to do that. That’s what they’re incentivized to do. You can’t blame these people, but that’s the case. The best way to remedy the situation, end unemployment benefits. I know, that’s why people say, “End unemployment benefits, what am I going to do?” Yes, there’s certain people that are struggling, but it’s easy to get a job.
Frank Curzio: You want proof? Numbers came out, is called Jolts, right? So basically, how many jobs are available on the market. This comes out every month. This number came in at 8.1 million jobs available. 8.1 million jobs available in United States. It’s the most insulated department since they’ve been keeping track of this data, since 2000. The most that are available. Based on Friday’s unemployment report, there’s just over 9 million people getting benefits. 9 million people are getting benefits, 8.1 million jobs. Of course, not all the jobs are going to be the right areas. You have to take away the punch bowl. You have to. It’s there, the data’s here, inflation’s here. What are you thinking?
Frank Curzio: I’ll break it down with Daniel later, with Druckenmiller too. I mean, saying, the destruction of the dollar, we may not have the reserve currency stats for 15 years? Druckenmiller’s saying that? He warned two years ago, I know. But saying the same thing. How are these policies still in place, when we don’t have the pandemic anymore? It’s dying down, we all see that it could come back, we could get different strains. I don’t know. But as of right now, everybody’s pretty cool. We’re fine. More and more people wear less masks indoors, even Gottlieb, which is one of the top people from the president saying, “Hey, you know what? We should really start looking at relaxing the rules for wearing masks indoors.” Here, we’re seeing all the numbers come down. Everything’s cool and more people are getting vaccinated.
Frank Curzio: But taking away the unemployment benefits, that’s one solution. I’ve seen Montana and another state do that. But we all know that’s never going to happen under the current administration, because cutting free checks in blue states is the easiest way to lose an election. I’m not being politically there, that’s a fact. I don’t care if you’re a Democrat, you’re going to agree with that, right? So a lot of votes. If you’re giving people free checks, they’re going to vote for you. If you take that away, good luck. It’s not going to happen, but it mixes this political agenda with the Fed. And it happened under the Trump administration, as well. You’re mixing those together and it’s crazy right now.
Frank Curzio: It’s crazy, because let me tell you, the Fed’s mandate used to be 2% inflation. Okay, if we see 2% inflation then we’re going to slow down. Then it went to like, “Hey, we’re going to see it a little bit more, maybe 3%.” The Fed’s mandate is not inflation anymore. The Fed’s mandate is to get unemployment to the same levels that were pre COVID. So, you’re looking at 3.6%, 3.7% under 4%. But if that’s your mandate, how do you get that unemployment rate lower by maintaining the benefits, for all these people? Because they’re never going to go back to work. That’s why the unemployment rate went up. So, what do we have, current administration, the Fed come out and said, “All right, we need more stimulus now.” No, are you crazy? You have the pedal to the metal here, the Fed, continued QE. That’s what they said, bond buying. Low rates are here to stay, not thinking about it yet and more stimulus is on the way.
Frank Curzio: But it’s a good thing. You don’t have anything to worry about, guys. You have nothing to worry about. Nothing at all. Nothing to see here. You know why? Because it’s transitory. That’s the new word, transitory. It’s brief. It’s going to be brief. You have nothing to worry about. This is just temporary, this inflation. We’re going to be fine. There’s not a Fed governor explaining why inflation will be brief. I mean, would love an explanation, given that you have zero plans to take your foot off the gas. I just feel like why? They’re saying that, but they’re not explaining why.
Frank Curzio: I mean, do you really expect businesses, all at the same time, to say, “Okay guys, it’s time to stop raising prices?” No. Because they all have pricing power, now. Everybody has some money. They’re passing these prices on to consumers. But are these prices going to continue to get raised and increased by most businesses, especially restaurants and bars. If you look at these places, on average, they have to operate at 80% capacity to break even. Now that they’re allowed, most of them will be allowed to be open 100%, they’re still operating at 60%, 65% capacity. It’s not because of lockdowns or restrictions. It’s because they can’t find people to work.
Frank Curzio: How do they get people to work? They provide incentives. A couple of places by me, restaurants, one said they provide a $1,500 sign-on bonuses for cooks, waiters, waitresses. Did you see the Marriott CEO on TV this week after earnings, said they’re providing incentives. Because these companies, if they don’t have enough employees to get back operating at 80% capacity, there’s only one way they can make ends meet. How do they do that? You got to raise prices. That’s what they’re doing. It’s okay and we see it. It’s here.
Frank Curzio: But the fact that the Fed governors, the Fed, they’re not even acknowledging this, and saying, “Yeah, we see it.” Yellen came out and said, “Well, I see inflation,” and she got wrecked. I don’t know if she got a direct call from Pelosi, from Biden, “What are you talking about? We’re not seeing inflation. We’re not at the ridge.” Eight hours later, she changed her mind. “No, no, no, I mean…” I think Yellen was speaking her mind. You see the numbers, you see the statistics. It’s easy. All of you see it. We all see it. Now, how does the Fed see it?
Frank Curzio: The one gauge they look at that’s supposed to mask inflation completely, is also showing massive inflation. What does that say? It says that you need to take away the punch bowl. You need to slow down a little bit, because inflation is here. What worries me the most, is it’s going to get worse because you’re pouring gasoline all over it and the Fed’s sitting there like they don’t even know it. They don’t want to raise rates. They don’t want to take the punch bowl away. They don’t want to lower leverage. That fuels the economy for now, but now it’s fueling ways that where every asset price is at record highs and continues to go higher.
Frank Curzio: Inflation is here, guys. I’ve been talking about this for the past couple of weeks trying to pound it into your head, because you need to structure your portfolios accordingly. It doesn’t mean you have to sell everything and run. Don’t sell, “Oh my God.” I mean, that could happen next year. Not now. But you’re going to see leveraged names get hit, and they’re starting to get hit. The ESG names, look at ARCS Holdings, staples and utilities are usually bad in this type of market, although the ones that have pricing power aren’t as bad. Well, okay.
Frank Curzio: A lot of companies have pricing power for now because everybody has money these days. Getting free checks. You’ve seen a sell-off in technology. High interest rates result in lower spending on CapEx for most businesses, which means, less money is going to be spent on advertising, technology upgrades, which is why, even though some of these tech names, especially, I mean, every one of them reported a lot of earnings, but especially looking at Facebook and Google, which is insane. I mean, these things are trading at 23 times forward earnings now. The Triad Market Multiple is growing 30% plus, which is again, insane, insane numbers, but probably not going to be sustained. Even they came out and said it, “Don’t expect advertising to be this robust. It’s going to slow down.” A couple of downgrades came out for Facebook, Google. You saw those names get hit. You’re seeing Apple get hit. You’re thinking, “Wow, these companies have great balance sheets, though.” They are. They’ll benefit from higher interest rates. The cash on the balance sheet. Remember, they make money from how much their customers spend and that impacts all their customers, so it’s going to hurt technology.
Frank Curzio: The best place? Banks. If interest rates rise, we have good exposure. The current Research Advisory Board, Bob Goldman really, really low price or up a lot on it now. Things got a lot higher. Goldman’s in perfect position. I mean, higher rates are going to be better for them. Plus, volatility. Guys, did you see the volatility just on Thursday, I mean, on Tuesday? Holy cow! I guess there’s volatility with the NASDAQ. Down 2%, up a little bit, down again. Bitcoin, up 1500, down 1500, up, back and forth, 10 year, up. I mean, nobody knew what they were doing. The market was all over the place. The Dow finished lower. I think the NASDAQ might’ve finished flat. We saw a stock down 15%, finished the day up 1%. They were all over the place. That’s great for Goldman. More volatility is great for Morgan Stanley, for Goldman. You still see an IPO is coming out. These guys are making a fortune and getting into crypto now because it’s a $2 trillion plus market. They’re well positioned.
Frank Curzio: Liquidity and volatility, two great things, and that’s why you’re seeing Goldman crush their numbers. Cyclical stocks, the reopen trade is here. You want to go to a cruise but you still don’t have a boat in the water and their enterprise values are higher than pre COVID, which is insane. But hotels are going to see earnings explode. You see, I think Caesar’s report record numbers.
Frank Curzio: As people go into casinos, domestic, the airlines are getting hit a little bit because they’re issuing what lockdowns overseas so I get that. You’re getting infrastructure companies, material companies, repositioned in a lot of these within our portfolios. Those are great plays on inflation. Commodity plays, gold in particular. I think gold got to 2,500 guys. I’ve never said that. I’ve got people on my pockets that said it’s gone to 5,000, 10,000 for the last 10, 15 years. I’m not a Perma-gold bug or nothing. I speak a lot in these conferences. I have so many friends within this industry that I’m grateful for. That is just amazing. But if you’re looking at everything, this setup is absolutely perfect for gold, and you’re actually seeing inflows into gold for the first time in a few months from institutions. Gold has no place else to go high and these, you can buy some of these producers and mid-tier producers, you could buy some of them at some of the cheapest prices in the whole market and they’re growing earnings faster than everyone because they’re producing at 900 to a thousand dollars an ounce, and we’re at 1800.
Frank Curzio: I think we’re going to be 2,500 by the end of the year. It’s inevitable. The Fed’s not stopping. They said, they’re not stopping. Money’s got to flow someplace. It’s not going to disappear. People are not going to go to cash. All these funds and BlackRock that had trillions. They make money by rotating it and keeping it into some kind of asset class for getting cash. They can’t charge you because these are businesses. Don’t forget that. They need to generate profits. But how do you set yourself up? Get some banks in your portfolio. Get a lot of these reopen trades. Get hotels are really good. Casinos are really good. Material companies are really good. Industrials, names that have pricing power able to pass off those higher costs, which is a lot of names now. Exposure to commodities, things like uranium’s going higher. The stocks are going higher. Lots of different places that are doing well even though you’re used to those ESG marijuana names that are getting destroyed right now. That’s normal in this type of environment.
Frank Curzio: If you’re a Curzio Research Advisory member, you’re coming out with a great play that you do fantastic in the current environment of inflation. It’s available around 5:00 PM today at about the time you listen to this. Make sure you check your mailbox. I’ll send that to you. Really exciting issue. Just, guys, get prepared. That’s it. Get prepared. Get ahead of things. That’s what you want to do. That’s what we’ve done in this podcast for 40 years, getting ahead of trends, buying in early, even through COVID, getting out early, getting back in a little bit later than expected, but slowly trillions coming in, but you want to prepare. It’s here. I mean, we all see it. The Fed still peddle in metal. That’s why you even have guys like Druckenmiller and just Jeffrey Gundlach coming out. These people have been in markets for 30, 40, 50 years saying, “Holy cow! I mean, this is going to be very, very, very bad, and it’s going to come a lot sooner than you think.”
Frank Curzio: Positioning your portfolios accordingly. Rotate into the right areas. You should have exposure in super high growth names. That shouldn’t be all your exposure, which was the place to be for what? 10, 12, 15 years? Growth, growth, growth, growth. Now, it’s more value plays, cyclical plays coming back. The economy’s going to grow at 7%. We see a lot of these names go a lot high before inflation really, really kicks in. But names that spend the most money and are leveraged, those are the ones that are going get hit the hardest and we’re seeing that right now. We’re seeing that right now so be careful.
Frank Curzio: We get to our interview. It’s a very special interview this week, which is being sponsored by blockchain.com. It’s one of the most trusted cryptocurrency platforms in the world over 70 million wallets or 100 billion transactions since 2011. Now, if you trade your cryptos on blockchain.com, you can earn up to 13% interest annually on your cryptos. It includes Bitcoin, fair and stable coins, USD tether. A lot of people don’t know you could earn interest on these coins. I mean, it really is fantastic. If you want more information to start your account, visit blockchain.com. It’s blockchain.com. I am a client. I love these guys. I’m never going to have a sponsor on here that I don’t believe in that I don’t use because that will be a reflection. That’s a reflection of me by promoting these guys. Great sponsor, definitely support our sponsors. It’s a free podcast, blockchain.com.
Frank Curzio: Now, my interview is with Kiersten Crum. Amazing story. This is a person that turned $500 into $50,000, which I’d have to say, we’ve probably seen a lot of young kids do. This is with crypto and Dogecoin and things like that. But this is a great story. We have a 21-year old who now has 200,000 plus followers in social media platforms. She took it upon herself to not say, to have that arrogance which you see what young investors that make a lot of money, but she’s teaching people and younger investors. She’s educating them how to open an account, how to use compound interest in your favor. When do you hear a 21-year-old talk like that? When I saw what she’s doing and I want more young investors involved in this, it’s fantastic. It’s going to be an awesome interview. Trust me. Again, it’s from a 28 year old who I really, really respect. She’s all in. You’re going to see it. It’s going to be great interview guys. Let’s get to Kiersten Crum right now. Kiersten Crum, thanks so much for coming on Wall Street Unplugged.
Kiersten Crum: Perfect. Thank you so much for having me today.
Frank Curzio: No, thank you. I know how busy you are these days. How crazy it’s been, and it’s amazing. I want you to start out there, your new guest. I want you to tell us a little bit about your story where in COVID your dad lost his business, he worked at a grocery store, responsible for family bills, and then you started with a small amount in the stock market and built it up to a large amount. Now, you turn it into an obsession. But I want you to explain it, just give people the gist of it right now, because it is a fascinating story.
Kiersten Crum: Basically, a year ago when COVID hit, I sent home from school and I was one to be very involved with school and very busy with school, so that was already quite a transition for me. When I came home, I didn’t really know what to do. Then, at this point, I found out that my dad’s business was also going to be shut down. It was a bar restaurant. Of course, COVID hit, that was shut down and I needed to find something to do. At the time, the only thing open and really the only job I could get was at a grocery store.
Kiersten Crum: I found myself working at a grocery store. I did not think I was going to find myself there. It was kind of a learning curve when I completely life switched like that really quickly. I found myself working in a grocery store and then I also ended up picking up a job at a bar serving and bartending at night. Then, this is kind of when I realized, let’s try to see if some of this money can start to also work for me. That’s where I found myself learning to get involved with investing stock market and really just as much I could learn as possible.
Frank Curzio: Now the timing for this was great, right? It was the market lows. I think you said, I read in New York Times, that article, you now have 200,000 followers on TikTok, which makes you really popular now.
Kiersten Crum: That’s right.
Frank Curzio: I guess, how seriously are you taking this? Because the videos that you’re doing and the reason why I have you on this podcast is it’s so important to educate young investors. When you educate young investors, you talk about everything which you do. You don’t just talk about, “Hey, I made money. It’s so easy.” No. You talk about how you’re reading books, how everything you don’t know, you’re writing down, you’re learning, and then you’re doing these videos and teaching everybody. I think that’s so important. But explain how important is that because I’ve been doing this for 25 years, and I’m still learning something new every day. Just to check your ego at the door with the amount of money you made and say, “Hey, I want to educate people. That’s pretty fascinating.”
Kiersten Crum: I mean, obviously when I first started out, this was not something that, ask me a year ago did I think I was going to be on podcast talking about the stock market? It’s so crazy. I mean, obviously I started out kind of total newbie. I knew nothing at all really. A few guys had told me to go to an investment club meeting and that was what sparked the interest for me. Then, once I saw this huge dip from the COVID, the way that the market totally tanked after the COVID, I was like, “Well, let’s use this opportunity to capitalize on this and let the market carry me up a little bit.” That’s how I got started into it. Then, I started sharing some of these videos on TikTok and it’s all tumbled upon and grown from there.
Frank Curzio: No, and I see what the educational videos and some of these, there’s a couple things that surprised me, that you said and it’s for young investors out there because most of these is Robinhood and I heard ThinkOrSwim, but you use Fidelity Pro? What made you use that? Just because most people who are beginners do go on Robinhood, but yet you get free trading with all of these services anyway in these days.
Kiersten Crum: Yeah, exactly. Honestly, a year ago, when I had no idea what a brokerage account is, straight up I had no idea. I asked some of the guys in the investment club and I was like, “Hey, what should I open up with?” One of them said Fidelity and I just kind of didn’t look anywhere else. That’s where I found myself and that’s the program I still use. I really like it. Now, I kind of dog on Robinhood. I hate to say it, but I mean, looking at it now, it’s just there’s not as many features and stuff, so I’m really glad that I started with more technical program because I was able to actually learn more than just having a simple chart to look at. I was able to actually start to analyze different trends and stuff on the program I’m using now.
Frank Curzio: No, it makes sense. What about the market conditions? Because you mentioned earlier how you were fortunate to invest at the right time when things are at their lowest during COVID, but now you’re seeing a lot of these stocks and a lot of popular names I see among kids are ESG, they’re marijuana stocks, and a lot of these names have taken off tremendously. But as you’ve seen over the past couple of months, two months, a lot of these names have gotten hit hard. Is there something that you learned about that? Because I know you’re focusing even on some of the bigger stocks that you’re buying, but it’s not just, “Hey, let’s buy these aggressive stocks and make money tomorrow.” Your message, which is different from most young investors, and this is why I love having you on, is more about, “Hey, you got to focus on the long-term.”
Kiersten Crum: Yeah, exactly. Well, I feel like when I’m telling my story, when I started doing this, it was never that I expected to get rich quick. It essentially turned into helping me get rich quick, which is kind of weird, but I never had the game plan of like, “I’m going to invest and make five grand tomorrow morning. Never had that idea.” Eventually, it started getting to that point where I was able to do that. But I was buying stocks that… My first stock I bought was Carnival. I bought it because it was hit so hard on the dip during COVID. Obviously, no one was going on cruises. I mean, still, no one is. But I personally knew that I was going to eventually go on a cruise in the future and I was a customer of the product. That was kind of how I started getting into trading those products or services I enjoyed and just investing that way.
Frank Curzio: Now, how is it now? Because I played basketball for a long time and my favorite team, by the way, is Kansas. Favorite team of any sport by which… Yes. I think you said you’re maybe going back to Kansas, but probably… Yeah, which is great, but I’m looking at everything is a hole basically. When you’re looking to invest in stocks, I want to talk about your methodology. Before we get to the Kansas bar, I want to talk about your methodology in terms of, is it just trading as a fundamentals? Is it you’re looking at p-ratios? Or is it, you mentioned with Carnival, you’re looking at things where, “Hey, now you’re a different investor because now when you’re going out into the world, you’re looking at things differently.
Frank Curzio: Because I was going to bring up the example when I played basketball, I became a referee and I look at the game differently than a player. Now, you’re out to all these places. You said Carnival, which stood out just now, is something that you know that you’re personally going to take. Do you go out and look at different things now? Is that the way you invest? Which is fine, that’s one up on Wall Street, right, which is one of the books you suggested. But how do you invest and how do you find your favorite ideas?
Kiersten Crum: It’s kind of a combination. I feel like the way I began trading was definitely looking at what I was a consumer of. Now, that I’ve been able to learn a lot more and let those traits slowly grow my portfolio just without doing and being as attentive to the programs. Now, I’m looking more at high volume stocks in the morning, doing a lot more of the technical analysis than fundamentals, really. But just looking at high volume in the morning, running a scanner, doing different things with charts, seeing what we’re bouncing off, different placement lines, and just going from there, doing more day trading now.
Frank Curzio: Who were some of the people that you personally follow? Because now you have this big following, which that comes with a lot of responsibility, right? Because it’s tough, there’s a lot of people that listen to you, young generation, everyone. Who are some of the people that you follow through social media platforms or maybe on CNBC or people that you really respect out there?
Kiersten Crum: Ricky Gutierrez, I don’t know how to pronounce his last name. That was definitely someone I was looking up to as well as Graham Steven. There was a few YouTubers that I’ve also looked… These two guys from Canada, Trader TV Live. Those were two guys that I really started when I started getting in day trading. I looked up to them and kind of, all right, how do I actually make this transition from when I first started investing with more obviously swing trading, because I wasn’t past that pattern day trading rule, and how to make the switch of how does one think as a day trader and what does that look like? Watching those two was kind of a switch for me and being able to take that path and switch over to more day trading.
Frank Curzio: Now that you’re so engulfed with this and you’re seeing… The New York Times, which is great and could actually … I thought it was fantastic just to have you on here so I’m going to show everybody this, which is cool. There is Trading Stock just right there, the New York Times, you’re on there, which is fantastic. That’s awesome stuff. But now it becomes an obsession. Because I’m obsessed with this, I’ve known this my whole life. How do you manage? Because to be the best at something and to be great at something which it sounds like you want to be, right, and you’re doing it at such an early age…
Frank Curzio: How do you manage it? Because when you do that, you have to give up so much. You have your friends and you have a social life and you have all that. For me, that was difficult at a younger age where you give up some of your friends, you have to give up some of these things really to be great at something. Are you seeing that? Or you’re making sure you still enjoy yourself? Have you given up things? Because now you’re getting more mainstream and more followers, I could see you do a much more and try and learn even more.
Kiersten Crum: It’s definitely been a transition. I mean, I think when I first started all this, my friends aren’t into trading. My other girlfriends are not into trading, have no idea what I’m doing. It was kind of a transition to be able to explain to them what I’m doing because I would just be like, “I’m sitting in my room, don’t mind me. I’ll be staring at a laptop for six hours today.” But I’ve kind of gotten to the point where now I dedicate a morning shift, I’d like to call it. Just treat it like a job, treat it like I’m going to a job for only a certain amount of time. I’m making a lot of my trades, especially now I’m doing day trading just for the morning up until mid-lunch and not really trying to be too engulfed in it all day so then I can still go out and have fun or do whatever the rest I want to do for the rest of my day.
Frank Curzio: You talk about trading and it was, you’re looking at different levels and volumes, stuff like that, really the volume and stuff. Have you found yourself learning new methods? Because there’s so many different methodologies and if one worked all the time, everyone in the world will use it. Not one works, so you’re combining everything. Because I do notice on your videos where you mentioned long-term investing, but also you’re talking about how important it is for compounding that interest, which is such a tough lesson to teach young investors because when you hit my idea, before you know it, I’m 49 and pushing 50.
Frank Curzio: 20-25 years is not that far away, believe me. If you just save up a little bit, it’s so hard in the market for young people, especially when you’ve seen so many stocks before this recent sell-off of technology, a lot of crazy stocks, that have gone up to 300% and you made a lot of money at a quick period of time. But are you seeing yourself transition to stuff like that and say, wait a minute, I’m reading a lot of books now, long-term investors, then, you happen to do a video on compounding, which I think is fantastic because that’s the hardest lesson to teach young investors.
Kiersten Crum: Especially in a minute. I mean, for me, that graphic, I’d seen the compounding graphic in one of my early like basic finance gen-ed classes and that was where the stock market stuck in the back of my mind. Obviously, I didn’t really act on it. That was two years ago. I didn’t act on it then. But that was definitely an important concept that I wanted to understand more. Now, I obviously understand that. Just very much learning how to manage between day trading and also the importance of compounding I’ve been able to read in any of these books. But it’s really cool, but since I’ve kind of made so many different transitions within my trading, from being an absolute newbie, I can’t necessarily day trade right now, getting to the, okay, now I’m day trading, this is what I’m doing, growing my account more quickly.
Kiersten Crum: And now it’s like, I’m slowly turning to where now I have enough capital where I can do more of the slower trades, swing trading and more long-term trading. And I don’t have to be as attentive on some of the day trades.
Frank Curzio: And I was curious what your dad has to say about this? Your family has to say about this, because you did it at a time when it was really tough for everyone. I would think it’s got to be a little bit inspiring to them.
Kiersten Crum: Right. Yeah. And definitely, my parents, they’re not exactly stock market experts. So, when I started getting involved with some of this, I think they were a little hesitant. Like, “I don’t know. I hear a lot of people lose their money doing this.” And I’m like, “No, trust me. Trust me. I think I know what I’m doing here.”
Kiersten Crum: It was a learning curve for them, but also, they didn’t really want to say much because they didn’t understand it. But obviously, very thankful to see where I am now. I think it’s been really cool to watch them watch what I’ve grown this past month, especially on more of a social media presence and sharing my ideas and my story has been really cool.
Frank Curzio: Yeah. Yeah. That is pretty awesome. And I want to get into one last thing here, because I know you said that some cryptos… You do own a few cryptos. I think you say you own Bitcoin, Ethereum and XRP.
Kiersten Crum: Yeah.
Frank Curzio: So, are you still looking at them because you also had a video saying, “Hey, I guess people learned a tough lesson. Buy rumors sell on news. Enter the Dogecoin, Saturday Night Live and everything.” And I can’t say how many young investors came to me and said, “Should I buy Doge ahead of that?” I’m like, “Well, usually you should be selling it at one point.”
Frank Curzio: So, it could go higher or lower, but it was a good vessel. So, how do you feel about crypto? Is it’s, “Hey, I got really good names and I’m holding forever?” Or do you take shots at them? Because the reward that you could see from those in terms of how much risk you’re taking is pretty incredible. These things that go up 10 X, 20 X, 30 X, some of these things.
Kiersten Crum: Yeah.
Frank Curzio: So, I’m just curious your take on crypto.
Kiersten Crum: Honestly, some of these meme coins and some of these just crazy ones, I just am not interested in. I feel like I already know too many fundamentals on doing sticking to the stocks. So, it’s all I’m sticking to.
Kiersten Crum: I have Bitcoin and Ethereum, and I did have some XRP, actually. Don’t have that anymore. But those two, Bitcoin and Ethereum, I’m going to hold those pretty long-term. I don’t plan on really trading those much. So, I’m in crypto, but I’m not in some of these super hype ones really.
Frank Curzio: And I’m going to bring something up right here, which is your TikTok page. This is an interesting number here.
Kiersten Crum: Right.
Frank Curzio: 195, 200,000. Again, we talked about that earlier, but that’s really incredible. And if somebody wants to follow you, what’s the easiest way? Is it through TikTok? Which I think is one of the greatest platforms in terms of anything.
Kiersten Crum: Yeah. Definitely.
Frank Curzio: Right. I mean, because I’m on Twitter and we have a very big following the podcast. Right. So everybody has their own social media channels. I know you’re on Instagram, but TikTok is yours. And one thing I realized about TikTok is it’s so much fun.
Kiersten Crum: Exactly. It is. It is, really…
Frank Curzio: I mean, it’s by myself laughing and learning compared to Twitter. There’s so many crazy people on there. It gets political and there’s anger on it.
Kiersten Crum: Exactly.
Frank Curzio: And even sometimes Facebook. But talk about how important it is for TikTok, because it seems like that’s a much better way than Instagram to reach the younger investors and also YouTube, which you say you were watching compared to other platforms like Twitter. But how can people find you learn more about you? And yeah, talk about that platform in TikTok a little bit.
Kiersten Crum: Yeah, of course. So, you can find me on TikTok. It is stonk.queen. Took the little meme of the stonk market and ran with it. So yeah, I’m definitely… I try to do a lot more videos on educating how to get started investing and how to more terms, rather than some of these insane call-outs, like invest in the stock and you’ll be a millionaire tomorrow. That’s not my vibe.
Kiersten Crum: But I mean, the TikTok community, especially this investor stock trading community, is so huge. It’s so crazy to see how many people are able to make jokes out of all of these trends and make them related to stocks. But then also, have a video that’s very informational and educational on how they got started investing. It’s definitely, really cool to see the community in TikTok like that.
Frank Curzio: And going to put you on a spot here.
Kiersten Crum: That’s all right.
Frank Curzio: So, what are you looking at now in terms of investing? I know trading, and we’re doing this on Tuesday. This is going to air tomorrow. So, things might change for 24 hours.
Kiersten Crum: Yeah.
Frank Curzio: But are there any individual names or sectors or things that you’re looking at right now? And if you have nothing right now, that’s perfectly fine. I’d like to see if we can get a couple picks out of all my guests-
Kiersten Crum: Yeah, of course.
Frank Curzio: That’s perfectly fine, but yeah. I want to see if there’s any-
Kiersten Crum: Yeah, let’s see. I was doing a little bit of trading this morning, actually. I took a good one on Facebook, got a $4 winner there. So, that was what I was looking at this morning.
Kiersten Crum: And like I said, I’m just doing a lot of those volume scans and trying to look at what I can just pick a few bucks on, putting in some money like that. So, it changes every day what I’m looking at. I definitely have always been a fan of the EV sector. So, I’m always keeping an eye on that. Tesla, if Tesla’s on sale, I’m always trying to grab some more. So, probably be getting some more Tesla this week.
Frank Curzio: And what attracts you? Because the young generation I see is into ESG stocks, that they’re into the Teslas. The ARK investments with Cathie Wood. It seems like that… Why do you feel like so many young investors are into that, when there are so many great names out there and there’s thousands and thousands of different investment opportunities? But that is what captures them the most. And those happen to be the most volatile.
Frank Curzio: What is it about that? Is it you can make the most money off of them or is it like you really believe in these trends? And some people believe in Tesla, Elon Musk. It’s a religion. But I want to understand that as well, where there’s so much out there to invest in, so many great sectors and names. But it seems like every young investor that I do interview or speak to, pretty much they’re all on the same sectors.
Kiersten Crum: Right. I think it’s definitely… I mean, you touched on how volatile that they are. And I think that’s something where a lot of these younger traders, myself included, are not necessarily scared, as we still have so much time. If this takes a rough dip this week or next month it’s, “Oh, well, I think this is something I believe in in the future.”
Kiersten Crum: But there’s so many opportunities to do all kinds of different trades. I mean, you can grab these for a long-term trade if you really think that this sector is going to be something that we see in the future if every car is going to be electric.
Kiersten Crum: And also, just the volatility-wise, you can grab these for a day trade and make some quick cash as well. So, definitely think on that side. Just what attracts a lot of young investors to these types of stocks?
Frank Curzio: No, it definitely makes sense. Well, Kiersten, I know how busy you are. I want to thank you for your time coming on this podcast.
Kiersten Crum: Yeah, thank you.
Frank Curzio: It means so much because have a young audience as well. And I want to say, keep doing what you’re doing. If there’s anything I can do for you, let me know. For me at this stage, it’s giving back, giving a platform to other people as well, because I’ve been doing this for such a long time.
Frank Curzio: And I loved having you on and getting your perspective. And again, it’s an obsession and then you have that responsibility because you have so many followers. And that’s really, really cool.
Kiersten Crum: Exactly.
Frank Curzio: I’m serious. So, I just want to say thank you so much for coming on. And one last time, if people want to follow you, how could they do that?
Kiersten Crum: Yeah. Find me on TikTok, stonk.queen. You can also find me on Instagram. My personal is just Kiersten Crum. And from there, you can find me everywhere.
Frank Curzio: All right. That sounds great. Thanks so much for joining us. I’ll talk to you soon.
Kiersten Crum: Appreciate it. Thank you.
Frank Curzio: Yeah. Great job on Kiersten. And for seasoned investors, maybe you might not be excited about it. She’s 21, she’s young. But you need to understand how young investors think and it’s important. I mean, a lot of us have kids out there. And it’s hard to explain investment to kids, even to my kids.
Frank Curzio: But when they see it to a social media channel, and she has a TikTok, which I think by far is the best social media channel. It’s the only one that makes you happy. You laugh. It’s cool. It’s educational.
Frank Curzio: You look at every other platform. It seems like there’s so much anger, politics, all this crazy stuff. To me, I just find myself really enjoying TikTok when I’m on it. And just going through videos, kind of thing. Because yeah, I don’t know. If you try it, it’s addicting. It’s pretty funny. It’s awesome. And the algorithm is tailored to what you like and see what you like. It’s really cool. Just give you more and more what you really love, which is awesome.
Frank Curzio: So yeah, but she has a massive, massive following. And understanding what those young investors think, what they’re buying, what excites them. I mean, that can help you tremendously. Hey, just talking about Tesla, Facebook. Should really talk about ESG, but I hear that from a lot of young investors.
Frank Curzio: And if you notice the companies that they’re buying, they’re emotionally attached to. So, they know what these companies are all about. They understand the macro picture. They’re not just taking a stock and saying, “Wow, this is good fundamentals. No one ever heard of it.” No, they invest in things that they hear of. They invest in things that they believe in. They want to learn about.
Frank Curzio: And for me, it’s just, I think if a stock’s really cheap and I like the industry it’s in and I think it will go higher, it doesn’t matter. I’m going to go find it for you guys, wherever it is and whatever sector it is. Maybe it’s in a hot sector, maybe it’s not. Maybe it’s depressed. But certain sectors that they do follow.
Frank Curzio: But I wanted to give her a shot and come on. Because when I see a lot of young investors, at least I come across, when they make money like this. And it comes with territory, it’s perfectly fine. They’re arrogant. And you should be arrogant. You should think, “I’m better than everybody else. I know more than everybody else. Dogecoin, I told you it was going higher.”
Frank Curzio: That’s great. For her to be where she is with her story, and her dad losing a job and what she’s done, what she’s accomplished, saying, “Everything I don’t know, I read, I write down.” And providing the educational videos and talking about compound interest, a 21-year-old. Man, I wish someone explained that to me. And I had my dad there, but it wasn’t really a conversation we had too much.
Frank Curzio: But now that I’m closing in on 50, I’m going to be 49 this month. Closing in on 50, you think about it and say, “Wow, I wish I invested when I was that young.” Because believe me, 20, 25 years goes by very, very, very, very fast, very fast. And you can accumulate that money in 401(k) very, very easily. If you’re in the right stocks.
Frank Curzio: And I really love what she’s doing. She’s not an arrogant person. She’s working hard. She understands responsibility. How so many more people are listening to her now and gaining those stories. The New York Times did a big feature article on her. So, I wanted to give her a shot, get her on here. And yeah, hopefully, you guys liked it, really.
Frank Curzio: And I want to hear from you, of course. I liked the interview. It’s about you, not about me. Let me know what you thought at email@example.com. Again, I had her on where, if you have younger kids, you could go to her TikTok page. If not, it’s perfectly fine. I know I usually have a lot of experts on here and give you ideas. But I do like to get them.
Frank Curzio: There’s so many young investors in the market right now. It’s a massive, massive market. These people want to learn. They’re all dialed in. And I just seen it recycled, recycled, recycled through my 25-year career where they buy when it’s a bull market, they get destroyed and then they hate it forever.
Frank Curzio: And I just don’t want them to hate it forever because they’re so ahead of the curve, they’re even ahead from where I was. And I’ve been in this industry, my entire life. Because my dad’s been doing it for 25 years as well. So, really appreciate her coming on. Let me know what you thought at firstname.lastname@example.org. So, time now to bring in my buddy, Daniel Creech. Daniel, what’s going on and how’s everything?
Daniel Creech: Frank, very good. Very good. Another beautiful Wednesday, man.
Frank Curzio: A lot going on. I mean, there’s a lot going on. There was some really powerful stories this week that I definitely want to talk to you about. One of them I think was Druckenmiller interview and there was an op-ed in the Wall Street Journal talking about the Fed. This is something that even you say. You said, “We really need to talk about this.”
Daniel Creech: Yeah. I mean, Stanley Druckenmiller is a billionaire hedge fund. Now, he runs a private office. Just, he’s one of the best voices that you can listen to in my opinion, especially from the macro level. I mean, he does tremendous work and makes great returns. Obviously, he’s a billionaire.
Daniel Creech: But the couple of big ticket items he talked about, which we’ll get to inflation in a minute, but you often refer to the gold bugs and how you can’t be a diehard one way or other. You got to be able to change your mind when the facts change. Stanley Druckenmiller, to his point, is as humble as you could be if you’re a billionaire. At least he comes across like that on TV.
Daniel Creech: Because he came out and said during this interview, and it’s about 10 minutes long. Well, there’s different segments of it, but I encourage you guys, go to CNBC, check this out. Because he starts off and says, “Hey, I was dead wrong. I came on and I said a V-shaped recovery in the stock market was not going to happen.” He outlined a couple of other predictions that did come true. But he came out and said, “Hey, I was wrong about this.”
Daniel Creech: But getting to the gold bugging thing, he’s talking about in the big headlines are one crypto and two. He thinks that the US currency could lose its world status. Meaning that it won’t be the currency of choice. Right now, it’s the reserve currency for the world. And he gave some good talking points about that. Frank, what stood out to you out of that interview? Because I’ll get more into that, but what about you?
Frank Curzio: That’s a big statement. That’s a big statement. Because Druckenmiller has sounded the alarm in the Fed. He did in 2018, ’19, I believe. And have articles saying this is getting a little crazy. And then we had COVID, right? So we understand, I think all of us agree, if you’re going to stop people from working lockdown, you have to give them something.
Frank Curzio: So, we all got that. That’s over. Maybe it comes back. Maybe we get a different… Right now, that’s over. That risk is dying down tremendously. You did, you accomplish it, you created inflation. You look at that employment rate, you’re going to say, “Well, we need more jobs.” You don’t have jobs because you’re handing people free money.
Frank Curzio: But for Druckenmiller, just showing the facts that foreigners continue to be net sellers of US debt, which is very, very rare. They could lose the reserve currency status in 15 years. And I said, “What happened to our generation?” If the Fed keeps this current pace of what they’re doing, just flooding the markets with money, we’re going to see runaway inflation. There’s no way to control that.
Frank Curzio: That’s what’s scary. I think people don’t understand. It’s not, you can throw money at it and you can… No, the only way is you’ve got to force a recession. You got to do exactly the opposite what you’re doing now. You’ve got to sell bonds. You’ve got to take away the punchbowl, no more stimulus for people, rates go higher. That’s going to be less people spending money. You’re not going to have pricing power. Prices are going to come up. That’s how you control inflation.
Frank Curzio: We’ve never been in that environment in… What? Since the 80s, and he’s sounding the alarm here. And obviously, I agree with him. I’ve been saying this for probably a month and a half now. And coming from him and coming for Jeffrey going just the reserve currency thing was the biggest deal, for 15 years. If you really, really believe that… I’m glad he threw that out there because I didn’t even want to go that far.
Frank Curzio: We need to go that far because it’s hard for me to believe. And we talk about this, Daniel, you make fun of me, that the Fed does not see this. They don’t understand what is going on. They were surprised that the unemployment rate went higher. They’re surprised that they didn’t add more jobs when you’re giving people free checks. I don’t understand. Yeah, I don’t get it.
Daniel Creech: Yeah. Frank and I still disagree on whether it’s done on purpose or not. So, we’ll save that for a different time. To his credit, Druckenmiller, he did say the 15-year thing. And he said he could change his mind depending on if the Fed changes policy. From an investor standpoint, it’s always important to know why you own something.
Daniel Creech: So, what you ought to anticipate as an investor and be thinking about from a longer term standpoint is, he was talking about how basically $500 billion, I believe it was, was normally coming into the treasury market from foreign accounts as hedges, institutions, different things like that.
Daniel Creech: When the coronavirus meltdown in the stock market happened, the bond market dropped as well. Showing for the first time that treasuries weren’t being used as a safe haven. So, international money wasn’t flooding in as a safeguard. That’s a big deal.
Daniel Creech: Now, it might be a one-off. It might not be, but anticipate interest rates moving higher, forget about the Fed for a second, just based on the flow of money. And that’s a big deal to pay attention to because money is not evaporating. It’s going to flow somewhere else. So, that’s where you want to look at in commodities and more inflationary things. The other big takeaway, Frank, is he thinks the dollar will be replaced by what?
Frank Curzio: He mentioned cryptocurrencies.
Daniel Creech: Well, he’s not sure of that.
Frank Curzio: He said possibly…
Daniel Creech: He didn’t say Bitcoin. He didn’t name anything.
Frank Curzio: Yeah.
Daniel Creech: But he did say a group of guys from MIT or Stanford would come up with a ledger based system. So of course, if you’re a crypto bull, man, you can take that and run with it because now, in addition to some other billionaires, Tudor Jones. He’s a billionaire, right? I believe.
Frank Curzio: Yes.
Daniel Creech: Billionaire, of course.
Frank Curzio: Yeah.
Daniel Creech: Him and the other, Mike… How you say Mike’s last name?
Frank Curzio: Temper?
Daniel Creech: No, the Grove…
Frank Curzio: Novogratz?
Daniel Creech: Novogratz, yeah.
Frank Curzio: Novogratz. Yeah.
Daniel Creech: I always want to start with a G for whatever reason.
Frank Curzio: He was on CNBC. He was on CNBC this weekend. It was great. Because Joe Kernen. I like Joe Kernen. I just wish he let the guests talk a little bit more, especially on Squawk Box. There’s usually have great, great people on there. I’m a fan of Joe.
Frank Curzio: But Joe, he was interviewing Novogratz and had a bad connection, and Novogratz had a bad connection. It was just an echo and stuff. And at the end of it, he’s like, “You know what? You might want to sell just one of those Bitcoins and get a new system.” And Novogratz’s like, “Yeah, yeah, you’re right. You’re right.” It was so funny. Because I was thinking the same thing. I’m like, “Here, this guy is worth so much money. And yet he has a system that you can’t even hear him. I mean, just get a decent webcam.” And it was just funny.
Frank Curzio: But yeah. Look, I agree with Druckenmiller. And you just got to see more people sound the alarm. Because the good news, the really good news, Daniel, is we see it. We know it’s here. This isn’t like a pandemic, you don’t see it. If you don’t see that risk in front of you, those black Swan events, that’s just the whole banking system. People thought, “Oh, subprime loan. It will only be a little…” They didn’t know that these banks were leveraged 30-40 to one. And they had to create synthetic, of synthetic, of synthetic loans and which would destroy the entire system. We didn’t really see that till later on.
Frank Curzio: We see what the problem is. We see what’s happening. We see what’s going on. Hopefully, the Fed does the right thing. And when they do the right thing, it’s going to be painful. We’ve been in an environment of easy everything since the credit crisis. And eventually, we knew this was going to happen.
Frank Curzio: We’ve had inflation where it was controlled and everyone was surprised to get inflate. We’re coming from a very deflationary environment. It was different times. Now, you threw trillions into the system. The pandemic is over. When you have people staying home, when you have chip shortage. You’re seeing things for the first time that we’ve never seen. Planes closing because there’s too much demand and they can’t get enough out. So, they’re idling production.
Frank Curzio: Things that you’d never seen before, you have to worry. But the good news is usually when you see something in front of you, you’re able to control it, you’re able to stop it. The Fed can do something about it, and hopefully, they do. So, that was the biggest takeaway I got from the story. But it was interesting.
Daniel Creech: Yeah. I mean, they can and they can’t. Because if they take the steps to negate inflation rising, you have to completely… So, we got to get to Rick Santelli, but one more thing Druckenmiller said that was so brilliant and just so plain and simple, is that the Fed and the government, or Senate and Congress and all that kind of stuff, are supposedly independent. Now, they’re really not, but that’s okay.
Daniel Creech: You cannot pass legislation and debt and spend at the rate you’re spending from a political standpoint. And it doesn’t matter Democrat or Republican, unless the Fed is being the middleman and manipulating rates and buying bonds and all that kind of stuff. So, they’re in a tight spot because if they do what’s right to fight off inflation, you’re going to significantly stop and hinder all the policies that are being promised right now. So, that’s a big political divide and that’s going to continue.
Daniel Creech: So, from an investor standpoint, just keep that in the back of your head. Turning to inflation, and they’re not going to raise anything because they keep saying they’re not worried about it and it’s transitory. I know you joked about that being a key word. Rick Santelli said it best. The problem with the transitory deal is that they can move the goalpost. So, if it doesn’t go down next month, next quarter or six months, they’ll just say, “Well, transitory is 12-month period.” Widen an eight month period, 18-month period.
Daniel Creech: And the scariest thing is, and this is where I believe it’s still the lead story on CNBC with inflation, and everybody ought to watch. It’s about a four minute video, but Rick Santelli says, the problem with that is that if you’re middle America and your food bill doubles, that hurts. From a Fed perspective, you look out a year, if it doubles and it stays there, then it’s not growing year over year and that’s all they care about.
Daniel Creech: So, in reality, you’re facing higher prices and consistent higher prices. And the Fed’s going to look at that and say, “Hey, we’re doing a good job because it’s flat lining, although it’s at a much higher rate.” So, that’s the nervousness takeaway. And you have to be able to decipher how they view things and how reality and how the stock market will come in. And like you said, we have plenty… Not plenty of time, but you know it’s coming so you can prepare yourself now and invest along and according to.
Frank Curzio: Yeah, Santelli has a problem. He just uses too much common sense. It’s not a good thing.
Daniel Creech: We need to get him on the podcast.
Frank Curzio: I probably can. I’d love to get him on. He’s very emotional.
Daniel Creech: He needs to be on the podcast. That guy’s great.
Frank Curzio: Yeah. I mean just seeing him and all the economists on, and again, I’ve interviewed some of those economists who were on TV when the CPI number was released, or the unemployment number was released. And just, he was the only guy that knew what was going on and it was amazing.
Frank Curzio: And it was just, he’s been that way for a long time. Just the common sense point, where you have Steve Liesman, couldn’t even find the number. And again, I know Steve Liesman, I met him. He’s a good guy. It’s just seeing them so surprised at something that seems so obvious to any single person living in America that pays their bills, that goes to work. I mean, it’s pretty easy to see it. Who goes out to eat at restaurants, we all see it. But just to see how flustered they were. I’m like, “Man, how don’t they see it?”
Frank Curzio: And that’s my biggest fear. Does the Fed really think there’s nothing going on? And you brought up a good point. Yeah. It’s transitory. They’re not saying why it’s going to be brief, but they could extend those goalposts. You said it well. And Santelli said it well. But another thing too, we’re seeing all commodity prices go up. Now, we’re seeing gasoline prices go up, which is awesome. Right.
Frank Curzio: So, the Gastro’s Colonial pipeline, we had hackers come in. And I mean, this is kind of a funny story in so many ways. And I say funny, because it is actually funny, where I’m showing it now. Guys, if you go to Curzio YouTube Research page, where you could see this in video. And we show everything, which is really cool and show exactly what we’re doing, what we’re talking about a lot of times.
Frank Curzio: But Colonial got hacked. It was a ransomware attack and they supply the Northeast. And the funny thing is that the hackers came out and said, “Oh, we’re sorry. We’re not political. We don’t put politics involved. We just care about the money.”
Daniel Creech: Was it cash, not chaos is what we want?
Frank Curzio: Yeah. “We didn’t want to create a crazy macro event. We’re sorry.” It’s like, you have a conscience now. Okay, you didn’t shut down the pipeline. So, what did that result in? It results in not a lot of gas and a shortage of gasoline. Going to a lot of these gas stations. And it’s funny how people react, because this isn’t a major, major problem. They’re probably going to be online in a few days. It’s actually the website’s up and running now. But it’s impacting states more like North Carolina, South Carolina, Georgia, even Virginia.
Frank Curzio: But when you get down to Florida, I don’t know if you know. Up to about Orlando, and then you got two and a half hours to get to all the way North where we are. But up to Orlando, it’s supplied by totally a different pipeline. Right. That’s where we get our supply from.
Frank Curzio: But yet everyone where we are, Daniel, they’re all going to gasoline. And they’re not just filling up their car. They’re filling up all these bins and putting them in it. Everyone’s like, the whole… Oh. It’s like, “Guys. It’s not that bad here.”
Frank Curzio: And even I talked to several gas stations too, over the past couple of days. And they said, we ran out of gas. There’s not really a shortage, but everybody feels a need that they have to fill up their tank right now, right this second people that don’t even drive that much. So, now you see any shore, you’re going to see gasoline prices. But the whole story is kind of interesting of how, one, I bet you, the car administration’s pissed off that the hackers came out and said, sorry about this, because they would have been able to say, “This is domestic terrorism,” their favorite word, domestic terrorist. So much domestic terrorism around. Everyone’s got to watch out. Don’t go outside your house. But you know how they just inflate the situation where they put things on, Daniel. And they’re like, ‘this is the seventies,’ in the seventies you were online for like four or five hours to get gas.
Daniel Creech: Yeah.
Frank Curzio: And it was 10 cars, right? Florida and North Carolina is a little different, right? They’re seeing it. Don’t get me wrong. But you got to relax a little bit because I think this is problem will take care of itself.
Daniel Creech: Yeah. I mean, it will. It’s an alarming flashlight on top of, hey, cyber-attacks are here to stay. So, we’ll have to work some of those into the portfolio eventually, but it’s going to be a good work of… I hate to say this, but capitalism and governments because governments have so many policies and stuff. And I got to give credit where credit is due. So Colonial, if you go to their website and look at their press releases, they’ve been given updates. And so the main pipeline is still down, but they got some sidelines and smaller pipes that are being mandatory operated and all that kind of stuff. So, they’re doing what they can, and Biden and the administration came out and suspended the temporary eligible hours of service exemption for motor carriers. He did a federal government, I don’t know the executive order, but basically it took away and says, hey, once everything gets up and running, which Colonial sounds like it’s supposed to be by the end of this week, hopefully, because tempers are flaring with everybody on edge anyway.
Daniel Creech: But, temporarily throwing that out, order out or, you know what I’m trying to say, Frank, I’m mumbling here, but this is going to be a huge thing because people are worried. I was talking to guys yesterday, and they think, man, this is going to last for a couple of weeks.
Frank Curzio: Yeah.
Daniel Creech: If they get it up and running on time with these kinds of exemptions, you can drive around the clock. You can get fuel delivered and everything. So, it’s another example of how everybody’s on edge on everything. That’s kind of where we are. So, everybody needs to take a deep breath, be grateful for how smoothly things normally operate and keep a level head about it, or go fill up a 500 gallon tank that can go home and hoard out.
Frank Curzio: Yeah, that is funny. And there’s also a story that came out of this morning, right? When we went to air that, that Biden’s proposing a $2 trillion bill to study, what’s causing inflation rates to rise. I’ll tell you what-
Daniel Creech: Hey, we’ll go for a billion.
Frank Curzio: I’ll do it for a hundred million, and I’ll tell you exactly what’s going on. You don’t have to spend 2 billion.
Daniel Creech: Don’t low ball.
Frank Curzio: If you don’t know what’s going on-
Daniel Creech: Lot of money on the table.
Frank Curzio: I don’t know. I’m probably leaving money on the table. But seriously, I’ll do it for him for a much, much cheaper price. It’s like baseball, right? You ever see baseball where you have the middle relievers come in. The middle relievers come in, and they have to face one batter, and they’ll walk them. They’ll walk them, like in the seventh inning. And then, they take them out. They’re like, all right, we need a right hand instead of left hand there. Now, and those guys get paid like three, four, five million dollars a year. I’m like, pay me a million, and I’ll walk the batter for you. It’s pretty easy. I’ll make sure I’ll walk them. And then you don’t have to pay me that much. It’s just funny how people get paid and I didn’t.
Frank Curzio: Anyway, I won’t even go there cause that’s another rant. But thank God Biden’s on this for the $2 trillion bill to study what’s causing inflation rates to rise, since he has no idea what’s going on, which is insane to me. He’s not the only one. I’m not picking on him. There’s a lot of people within… They should know what’s going on. It’s very easy to see. We all see it. But apparently the smartest people who we hire to represent us have no clue. They have absolutely no clue what’s going on. We do, but they don’t, which is fine.
Frank Curzio: What I want to talk about, Dan, is the massive volatility we saw yesterday. I mean, we saw whipsaws back and forth. Even today, you have the VIX higher. It seems like people are confused, and they don’t know how to play. Where we had the unemployment rate come out Friday… Then, we had the CPI number come out this morning. And inflation, you’re seeing it all over the place, where the NASDAQ was really getting crushed. I think Palantir was down like 15% and finished the day up 1%. A lot of these leverage asset plays and technology plays all over the place. But, what’s your take on that? You think people are confused? I don’t know. I’m just asking. I just surprised to see it was back and forth. Even with Bitcoin back and forth, up 1500, down 1500, it seems like people are trying to position themselves, but they really don’t know how to do it.
Daniel Creech: Yeah. I think it’s just the new normal, I think this is what you should expect going forward. I mean, NASDAQ was down, was it 2.5% yesterday? And then, it finished basically flat.
Frank Curzio: Flat, yeah.
Daniel Creech: Today, it’s down 2%. This is mid-market, so we’ll see where it finishes. But it just shows you, you can’t have trillions and trillions of liquidity sloshing around and not go places. So, you’re going to see massive swings. The way I would interpret that in use is, if you’re a day trader, I would sell on rips and play on dips. And if you’re a longer-term investor, focusing on certain, what I hope comes from all this, and it will eventually. I just don’t know when, and that’ll be a lot more stock picker’s market, instead of everything moving kind of with the wave of money, the tide comes in, tide goes out, type of deal, everything, moving up, everything, moving down.
Daniel Creech: So, if you’re a longer-term, and as a longer-term, those solid businesses that you have a lot of faith in. I would use the pullbacks to buy for the longer term, because think about it this, Frank, another way. I’ll dumb it down to my level. Yesterday, there were certain stocks that had 10% or more swings.
Frank Curzio: Mm-hmm.
Daniel Creech: So, the common sense in me says is this stock really worth 10% less 15 minutes ago than it was now? What the hell changed? Do they hire anybody new? Do they get a new order? No, it’s just algorithms going crazy and people getting in and out. I just think it’s the new normal, and we’ve seen more volatility lately, and it’s going to get a lot more, lot of it across, a lot different sectors.
Frank Curzio: Yeah, no, I agree. And Goldman Sachs, Morgan Stanley, this is the environment they thrive in, more volatility, the more liquidity in the market. That’s what you have. You’re going to see those numbers. It’s not like you’re seeing numbers from stay-at-home plays that are no longer stay-at-home plays. People worry that those numbers are going to come down, they will for a lot of companies, to Peloton to Zoom and stuff like that. I get it. But these guys have incredible earnings power, and you’re going to see them continue to beat those estimates. You also have a stellar red hot IPO market, a lot of IPOs coming to the market. And the biggest ones are always going to be from Morgan Stanley and Goldman Sachs and deals and mergers and stuff like that. So red hot market for investment banks right now, and that’s going to continue some earnings, right?
Frank Curzio: So some pretty crazy earnings. One of them is Roblox . And I love this company, guys. I really do love this company because my daughters actually play all the time, and it’s always, “Fad, can I have five bucks to buy this?” Or, “Can I have three?” And most of the time, no, no, no. And sometimes, we’re just so busy, I’m just like, “Yes, here’s 10 bucks, and make sure you don’t bother me for three hours.” But they’re always playing. It’s kind of educational. It’s fun. They build their own things. You can build your own games within it. This is, to me, Fortnite on steroids.
Frank Curzio: The fact that you could build your own places and everything, the amount of money at these kinds of things, I mean daily active users were 43.3 million, up 37% from last year in April. 3.2 billion hours engaged, bookings 245 million up 60% year-over-year, daily active users up tremendously 17%. And also, they said that even the users who are over the age of 13 were up tremendously. This is not your typical fly by night technology company, snowflake type thing where, “Hey, this company is a man.” It’s like Coinbase. Their massive EBITDA earnings, just revenue generators. There’s constant money coming in. As long as you’re seeing cryptos you see more… EOS is up tremendously, right? Daniel, you had news on EOS that we have in our portfolio, which is up… How much was it up yesterday?
Daniel Creech: I think it went up 40% yesterday, and it was up another 10 today.
Frank Curzio: Yeah, it was Peter Thiel started an exchange. You’re going to use-
Daniel Creech: Well, a back company. Yeah, I think it’s $10 billion is what they’re going to invest. And/or they raised… I don’t have it right in front of me, but it was a 10 billion number and to build an exchange, and it’s only going to be on EOS and that took off.
Frank Curzio: Yeah. And EOS took off, but still, just the exchange where that’s not coming in for a while. I’m sure you’ve got to get licensed and everything. But Coinbase is just constantly trading more and more. These EOS is going up. That’s great. You’ve seen Ethereum, or 4,000, which is incredible. It’s not just Bitcoin, which represented 70% of the industry not long ago. Now, it’s like probably 45. So, same roadblocks here. You have to realize that the amount of money that these companies generate constantly, there’s a reason why… Was it Epic games? Candy crush? I forgot who bought them for five point something billion. I think they paid for Candy Crush. And you know what Disney paid for Lucas and Star Wars? It was like four point something billion. Think about that for a minute.
Frank Curzio: Why? Because it’s all a fight for eyeballs. And these guys have eyeballs on them just with the 3.2 billion hours engaged. That’s why you’re seeing companies like Facebook and TikTok, here’s one of the platforms you’re seeing the younger generation spend a lot of time on, younger kids. And then it’s just going to come down to how do we advertise? How do we program these kids to do what we want? And then, you get the advertising dollars or whatever.
Frank Curzio: But man, the amount of money that these platforms make are absolutely incredible. And I wasn’t surprised that stock went up 20% now, above its IPO price. It did fall a little bit, but still, we’re seeing pretty good earnings come in. But I don’t know how long this can last. Dan, it would all be shortages. And you go to Best Buy to buy something and it’s not there, you got to buy it someplace else. So, it’s going to impact companies. You have higher taxes coming, definitely corporate taxes, just a lot of risks. You have inflation here. So, can you continue to pass off those higher prices? Is the Fed going to do anything? When you look at all these risks in the marketplace, you have to be a little concerned where a lot of these names are trading in terms of valuation right?
Daniel Creech: Yeah. Oh, absolutely. Yeah, there’s always reason to be concerned, and there’s plenty of them right now. I know I’m going to sound too repetitive, but can Roblox continue this kind of growth? Maybe. Can everybody? Absolutely not. So again, it’s going to get much more selective on the results going forward, now that a lot of things are not only priced in, but now you’re going to be comparing. We only move forward. And so once you start looking back, comparing all these amazing returns, that’s when you really have to start paying attention, we’re still a little ways from that.
Daniel Creech: But Roblox is like Facebook to me. I remember talking about a few weeks ago or several weeks ago, whenever it went public, had no clue what it was. They still don’t. It’s only about 15% higher than its IPO price. So long-term, this might be a decent entry point, but I read through the earnings release… Yeah. I mean, the growth is incredible. Facebook; same way. And you probably ought to just buy this, even if you don’t use it. I have a Facebook account. I think I get on there once a year to wish everybody thank you for telling me happy birthday. I’ve been a bull on Facebook for a long time, even though Wall Streeters was a city group that downgraded Facebook and Google,
Frank Curzio: I think so, it’s just-
Daniel Creech: Did they not listen to this podcast? What the hell?
Frank Curzio: Yeah. They said that they’re expecting advertising rates to slow.
Daniel Creech: Yeah.
Frank Curzio: Going forward.
Daniel Creech: Anyway, like I said, I’m only bullish on Facebook whenever you see a headline about a government breaking them up. That’s when you keep buying it.
Frank Curzio: And I respect that. I really respect that downgrade. I mean, I don’t know if I totally agree with it, but it’s against the grain. Everybody else is bullish on these names completely. So, the numbers come out, it’s easy to get super bullish and say, these things are going a lot higher. And this guy is just like, “Hey, you know what? It’s going to slow down a little bit.” And I liked that. I like reading other perspectives, people have different opinions, you know?
Daniel Creech: I mean, I was having fun. It was a solid report. Yeah.
Frank Curzio: Yeah, it’s very cool. So, it wasn’t kind of making this name for himself. He already has a name. No, it’s interesting. That was an interesting call, but I just saw it come across CNBC right now. They said that Coinbase, the number one selling app on the Apple App Store right now. So, we’re just going to see more people go onto crypto. You’re seeing it. This is a real industry, and you talk about a study, right. And crypto, and just the average owner and who was done by a… He bribed some stats, he had those available. And that was pretty cool actually.
Daniel Creech: Yeah. Gemini, the exchange started by the Winklevoss brothers, the billionaires gave them some fun stats. I don’t know how broad this was. I was skimming through this the other day, it caught my eye because the most bullish case for crypto, roughly 13% of US adults plan to purchase cryptocurrency in the next 12 months. That’s pretty cool.
Frank Curzio: Yeah.
Daniel Creech: That’s approximately 19.3 million adults. Let’s see here… There’s another fun couple of things. There was a lot-
Frank Curzio: Like the average age and stuff?
Daniel Creech: Yeah It was a mid-thirties making 80,000-ish a year, I think is your average crypto owner.
Frank Curzio: Mm-hmm.
Daniel Creech: So, that says a lot just about the demographics of it. I thought the big standout was how many people plan to buy it over the next year? That goes hand-in-hand with what you’re saying about Coinbase getting downloaded. But 74% of crypto holders are men. 77% of crypto owners are under 45.
Frank Curzio: All right, 45, that makes sense, yeah.
Daniel Creech: So, along with ruining the Earth by using too much electricity, now it’s going to be sexist and racist. So, watch out for those headlines.
Frank Curzio: Yes. It’s already… It takes up too much electricity, right? So-
Daniel Creech: Oh, I was wrong. I’m sorry. 38-year-old, the average cryptocurrency owner is 38-year-old male, making about $111,000 a year. Now, according… This is, again, with Gemini-
Frank Curzio: Yeah, no, it’s interesting, but there is a learning curve here. But I can tell you the reason why more and more people are going to use crypto is because when I first really got into crypto, say three and a half years ago, before we did our CEO token, it amazed me how these people… They talk a different language. It’s Chinese, proof of stake, proof of work, all the technology… If you read the white papers, it’s maybe 0.1% of people that understand what this is about.
Frank Curzio: And now you’re seeing companies like Gemini, a lot of these other platforms that can get a Coinbase, even the Robinhoods, right? When people complain about, where you make it very easy, you dial it down and you show what these things are about, how easy it is to buy them, how easy it is for you to get money from your bank account over to an account and buy Bitcoin or whatever theorem, and then sell that and get that money back into your account.
Frank Curzio: That used to be a major process. Signing up for an account used to take three, four days. I remember when you look at custodians, when you have custodians that you’re raising money in crypto. If it’s just crypto, it goes to a different custodian, and they would provide codes for you, special codes for you, Dan. I’m not kidding, they… So, they would be like, “We’re going to do a number code, and your number’s plus two.” So, if they go seven, I would go nine. I’m just hypothetical. It could be five, whatever it’s plus… And that’s how they know it’s you. But if you go minus one… So as they say, three, and you go, “two,” you’re under duress. Now, it’s like, what, what does that mean?
Frank Curzio: That’s a crazy industry. It was just in 2017, 2018. Now, you’re seeing things get a lot easier. And when you see things get easier, you get more adoption. A good example is I explain this all the time as Michael Lewis. Michael Lewis got my mom to go to see Moneyball, which is about statistics and baseball, two most boring things on the planet, and he got my mother go see it. Why? Could she could dial it down. You told a story, and the power of stories… And now, you’re hearing so many different stories too, of the people buying Dogecoin and being rich and young kids turning $1,000 into $500,000. And people see that, and they want to get involved. I really think we’re just in a very early stage of this. There is going to be so many different facets of where this works.
Frank Curzio: And even for Druckenmiller to come out and say, it could be guys from MIT or Stanford that create some kind of digital token, it is going to happen. It is going to happen. So, you have the industry that’s here. I think you get to see that age go up and higher and higher. You’re getting more institutions involved, but I still think we’re in an infancy in this industry. It doesn’t mean Bitcoin’s going higher or lower, but there’s a lot of different trends within this, NFTs. We still get hot for a little while. DeFi. We’re going to see more exchanges, especially for security tokens, getting launched over the next six months, just a lot of exciting stuff coming down the pipeline, which is cool. I think it’s going to disrupt more and more industries. So, I’m pretty excited about it, but it’s amazing how so many people are really, trying crypto for the first time.
Daniel Creech: Yeah, absolutely. And the big takeaway there is: Just have some exposure to it, either through stock that is involved in some crypto mining or something to do with that, a lot of them are holding it on the balance sheet. And also, buy some cryptocurrencies. You don’t have to put a lot of money in it, and you don’t have to buy just Bitcoin. There’s a lot of other ones out there. So yeah, at least have some exposure to it because it’s not going away. So, it will be crazy volatile, but have some exposure to it as an investor.
Frank Curzio: No, absolutely. So yeah, a lot going on this way, we covered a lot, Dan. I want to thank you so much for coming on, man. I really appreciate always getting your thoughts and stuff. So again, lots of positive comments. I like it when it’s negative. So, I want you to talk politics a little bit more.
Daniel Creech: You know, I give credit where credit is due.
Frank Curzio: Daniel@curzioresearch.com.
Daniel Creech: That’s right.
Frank Curzio: Don’t send them to me anymore; send to Daniel. I’d be more than happy to read them on the air because some of them will come in there. They’re funny, but it’s pretty cool. But Dan, thanks so much, for joining us man, I really appreciate it, buddy.
Daniel Creech: Cheers.
Frank Curzio: And by the way, don’t go anywhere yet. Because the last thing here is, we’re getting a lot of demand for our Dollar Stock Club, which is an introductory newsletter, basically. It’s only $4 a month, a unique product because you listen to this podcast, and we get these ideas through our guests, and sometimes, they have funds, and we’ll pick an idea from there. Sometimes, I’ll talk about it on the podcast. And a lot of times, since I know these people for a long time and have been doing this for 14 years, we talk before and after, about ideas. And sometimes, we’ll throw some of those in this portfolio, but you’re getting a host of ideas from viewers, great minds, and people who help us get into trends and stuff like that. And the portfolio’s doing very, very well, which I’m happy about.
Frank Curzio: But Daniel, you do a lot of work on this portfolio and The Dollar Stock Club, and just get to see a lot of people come in at the price point of $4 a month, which is a dollar a week, basically. You’re getting a pick almost every single week, which is really cool. Again, introductory; you can cancel any time. But I know you run it. You have fun with it, right?
Daniel Creech: Yeah. It’s good. We keep it short and simple, but it’s a great idea generator because every week, just about every week, you get a different sector, or a different expert, or a different personality, on there talking about what’s got their eye, and it’s just neat to pay attention to a lot of different things or what people are paying attention to. And a lot of times, you get some big winners. Of course, people are going to be wrong, or we’re going to be wrong on what sectors or whatever we choose. But again, it’s an entry-level idea generator. And yeah, it’s a good product. And hell, for $4.
Frank Curzio: Yeah, I know. And a good example of this guys is you hear me talking about inflation, I’m worried, but there is emails that came in from people saying, you know what, Frank, I think we’re in a deflationary environment and I don’t agree with it. But I like when we have guests like that on who challenge… Because we had Chris Macintosh on recently, but we had him on over a year ago, and he was saying that he likes all stocks. I thought it was crazy. This is like not even midway through COVID, I’m like, this ain’t no way. So me, I disagree with it.
Frank Curzio: Sure enough, it did go down a little bit, and then it surged. We bought an ETF, but you’re getting really good names from everybody, from experts. And not only that, from my perspective, too, what I love is you’re able to keep track of the performance on a lot of these people, what they’re saying, which again, I don’t just want to put anyone in front of you. And if they give me a bad picture, losing money, no, it’s my job, creating this podcast, I say, it’s about you, not about me just getting the right people, vetting them. Yeah, we’re going to be wrong on some certain picks. I love guys that come on and explain that right away, and say I was wrong on this, but here’s why here’s what we’re doing.
Frank Curzio: It really has that accountability factor, which you don’t see anywhere on Wall Street these days, or on a lot of different things, especially in politics. Like, people never wanting to say, ”I’m sorry, I’m wrong.” Never; this is something that you hold people accountable, and it’s resulting in a lot of great picks and a lot of great guests coming on. So yeah, if you guys are interested that, you can go to our website, curzioresearch.com. Again, it’s a very, very low price point. We don’t make money on it. The goal is for anyone out there who doesn’t know us, that’s that introductory newsletter. And then, when you see what our research is all about, you listen to the podcast. Most of the time, you’re going to subscribe to a lot of our products, which is good for a lot of our subscribers. They don’t subscribe to one. They subscribe to many of our products, as they’re all really, really good. And we’ve got great editors here and people do really, really great research.
Frank Curzio: So guys, that’s it for me. Thanks again, Dan, for coming on. I appreciate it, thanks so much for listening. Enjoy the weekend, have fun. The weather’s getting nice. Hopefully, you’re able to get gas, and it’s not too crazy if you are on the East Coast. As always, I really appreciate all your support. And I’ll see you guys in seven days. 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 hosts and guests. You should not base your investment decisions solely on this broadcast. Remember, it’s your money and your responsibility.
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