Wall Street Unplugged
Episode: 1104January 10, 2024

Frank Holmes: Bitcoin and gold are both set to soar

Frank Holmes: Bitcoin and gold are both set to soar

I’m currently in Las Vegas attending the annual Consumer Electronics Show (CES 2024). Make sure to follow me on X for live updates on the biggest tech trends of the year!

I have a special episode for you today. I sat down with fan-favorite guest Frank Holmes—CEO and chief investment officer of U.S. Global Investors—for a wide-ranging interview.

He starts by explaining why 2024 should be a bullish year… why he expects gold to nearly double from current levels… and which gold stocks he expects to outperform the rest.

Next, Holmes, who’s also executive chair of HIVE Blockchain Technologies, shares his thoughts on crypto—including the ongoing debate about Bitcoin vs. gold… how he expects the market to react to the eventual launch of a Bitcoin ETF… the biggest headwind for the industry… what the upcoming Bitcoin halving will mean for crypto miners… and why Bitcoin could rise more than 400% over the next couple of years.

Inside this episode:
  • Frank Holmes’ outlook for 2024 [3:43]
  • Can you be bullish on both gold AND Bitcoin? [9:07]
  • These stocks will outperform as gold prices soar [19:15]
  • How the market will react to a Bitcoin ETF [27:47]
  • The biggest hurdle for the crypto industry [31:45]
  • What the Bitcoin halving means for miners [37:15]
  • Why Bitcoin could surge over 400% [51:03]
Frank Curzio
Frank Curzio, founder and CEO of Curzio Research, is one of America’s most respected stock experts. His research is regularly featured on media outlets like CNBC’s Kudlow Report, The Call, CNN Radio, ABC News, and Fox Business News. His Wall Street Unplugged podcast—ranked the No. 1 “most listened-to” financial podcast on iTunes—has been downloaded over 12 million times.
Transcript

Wall Street Unplugged | 1104

Frank Holmes: Bitcoin and gold are both set to soar

This transcript was automatically generated.

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

Frank Curzio: How’s it going out there? It’s January 10th.

I’m Frank Curzio. This is the Wall Street Unplugged podcast where I break down the headlines and tell you what’s really moving these markets.

So if you see me right now, I’m actually not here ’cause this isn’t live.

I’m in Las Vegas, Consumer Electronics Show.

But right now as you’re watching this, I am doing an AI tour, an exclusive AI tour, right? It’s executive tour I pay a lot of money for, and they’re going to take me around introducing to the newest AI technologies, external electronic show and all the companies and how they are using this technology and incorporating in what they do pretty much every day.

So, six to eight hours.

I think this tour is, it’s in both major venues, which is the Venetian, that’s the hotel I’m actually staying at.

Also, it’s gonna be at the convention center, get 2 million square feet.

It’s gonna be a lot of fun.

It’ll be really cool.

Uh, I think 120,000 people expect to show up.

Uh, this is where all large technology companies, all technology companies in the world, come to this event to announce the products are gonna launch over the next three to six months.

So I’m gonna give you the exclusive, a lot what’s going on in this field, which I know a lot of you’re interested in.

So, really, really cool stuff.

I’m gonna be there the whole week.

Follow me Twitter @FrankCurzio.

I’m gonna be having lots of videos, updates and tomorrow I’m gonna join, try to join Daniel live from the floor of the Consumer Electronic Show if I can.

Uh, this way I can give you an update, realtime update and everything that’s going on.

So be short, watch Thursday’s podcast.

If not, I’m gonna be able to give ’em a lot of data, a lot of stuff.

Again, I’m gonna be doing this with my team, like I always do every single year.

I’ve been attend this conference for 12 years.

I find the best ideas, a lot, lot of fun.

In the meantime, for now, I’m gonna leave you with an interview that I did a couple days ago with Frank Holmes, you know, HIVE Technologies, mining company, executive chairman, and also in the gold industry, U.S. Global Investors.

Great, great guy.

Good friend.

Uh, listen to this interview, right? We talk a lot about crypto.

Gonna talk about the gold industry.

You know, how come gold didn’t go up? He’s gonna talk about his Bitcoin forecast, which is pretty high.

Really, really high.

And he’s looking at just a couple years out.

So, fantastic interview.

Lemme know what you thought.

The interview, of course.

frank@curzioresearch.com.

And here is Frank Holmes interview right now.

Frank Curzio: I want to welcome Frank Holmes to the Wall Street Unplugged podcast.

Frank is the CEO and Chief Investment Officer at U.S. Global Investors.

He’s also the executive chairman of HIVE Blockchain Technologies.

Also very good friend.

Happy New Year Frank.

How things going buddy? Frank Holmes: Fantastic.

And happy new to you and all your subscribers.

Frank Curzio: So we have seen a lot.

There’s so much to talk about.

First we can go to crypto, we can go to markets.

I guess we’ll start with the markets.

’cause I know what HIVE Technologies that, that’s gonna be a big conversation with how much crypto’s moved and where it’s going.

You have forecast on your site, but I wanna start with the, with the markets, because yeah, we’re used to a Santa Claus rally.

We’ve seen the markets absolutely surge though.

it’s like a best November of 40 years I believe.

But then in December it was interesting.

No one really expecting anything.

Then all of a sudden a Fed pivot outta nowhere when 10 days earlier, you know, Powell’s like, you know, rate cuts aren’t even on the table.

And then you saw another 3% move.

We’re looking at the market being up, you know, a ton from November on.

Is that gonna be a reflection into next year? ’cause it is an election year and we know the market goes up in election years, but what are your thoughts heading in given that huge, huge rally that we had, towards the end of, 2023? Frank Holmes: Well, I, I, earlier last year, in 23, I commented that when you go back over 60 years of data points, the presidential election cycle, which is a four year cycle, is really significant when you, in the third year and the president is a Democrat and Congress is Republican.

And when that happens, the market’s up double digit at year end.

And you saw it go up, you saw it fall.

You saw a bifurcation that took place, with the Magnificent 7 leading the charge.

But nevertheless, the S&P 500 was up double digits and there was so much negative news everywhere per everywhere around the world.

It, it, it’s really interesting how powerful that data point is.

So now we’re going into the fourth year of a presidential term.

And what is the math of a four-year? President’s term historically is not as good as a third year unless interest rates are falling going into the fourth year.

And that’s what we have.

So it could be up 9%, it doesn’t mean it’s not gonna have lots of volatility between now and this time next year.

But with falling interest rates, I think the market can trade higher.

Frank Curzio: So it’s interesting because right now the market is pricing in, I think Powell suggested maybe three and the market’s price in six now for, for next year.

So a lot of that is, it seems everybody’s really expecting it and it should be, right? We’ve seen inflation come down.

What are your thoughts when, when we head into election year? ’cause everyone says, and they’re right, right? The election year that the market always goes up.

They say it goes up, I think 74% of the time in election year.

But when you look and you take a step back, ’cause you know how you can interpret data any way you want on a regular year.

The market goes up 65% of the time.

Also, the average gain is, believe it or not, just 6%.

Where on election years where the average gain is more like nine percentage, depending how far you go back.

I mean, 56, 57 was when, when it, the S&P became 500 companies.

around 9% returns.

Uh, so you’re particularly like higher returns for the election year.

And mostly just because we are going to see the interest rates.

’cause some might say, okay, maybe that’s factored in because we’ve seen the market rise pretty much 5% since the Fed made that decision and that pivot since, December 13th.

Frank Holmes: Yes.

And well, I I think it could be more.

’cause what really shocked me this week, you know, when you look at data points was the PMI and I write about it every month.

And the, and for your listeners, that’s the purchasing manufacturer’s index.

Why do I follow that? Is because it’s a very strong leading indicator.

And, and, and, and it’s simple because if you get a big order to manufacture some motors, then you’re gonna order a lot of copper.

You’re gonna use a lot of electricity, you’re gonna hire workers to make those motors.

So it is very forward looking and it’s highly correlated to commodity demand.

Uh, it had bottomed in, in the, in the fourth quarter, and it looked like it, it was turning up then.

I mean, by that is the last month is above the three month average.

Uh, when it’s below this magic number called 50, it means the economy’s contracting and it fell below 50, rate as rates were rising.

And what shocked me, I thought it was gonna turn up for this for last December, but actually it’s negative.

And what does that mean? Well, bad news is good news.

That means they’re gonna drop rates more.

It’s an election year.

That means they’re gonna have to fuel the pump.

Uh, they’re gonna do everything they can to ignite this economy because the purchasing manufacturer’s index is weak.

Europe is bottomed.

Uh, it really surprised me.

Germany almost fell back to pre to, during COVID numbers.

Uh, if you, if you look at those data points.

So I, I think the world’s gonna go through a big reflation.

Uh, I think you’re going to see, you’re gonna see gold have a, a great run, later this year.

It had a, a big lift at the beginning and now rates are sort, bottomed up, but rate rates aren’t gonna rise much with that negative news.

Frank Curzio: Let’s talk about gold for a minute.

So you are a person that believes in gold and Bitcoin, right? I think we’re, you know, at least a few of the people, not not many out there.

It’s either one or the other and people hate each other back and forth.

But when I look at gold and I look what happened in 20 22, 20 23, where I felt like gold for 10 years prepared for the ultimate event, right? This massive spending globally, central banks craziness, massive inflation.

It seemed like the perfect environment to, for gold to go to 3000, 4,000.

Now you’re seeing inflation come down.

Even real interest rates are positive, right? You’re seeing if you, if you’re looking at, you know, risk-free rates 4% inflation, 3%, meaning you could earn interest instead of just holding in gold.

If gold didn’t go up, then under those conditions, what’s the argument that it’s going to go higher? Because that’s the the question I’m being asked.

And I’m curious with someone who, who has an ETF you’re wearing, you go, au ETF I went there to the New York Stock Exchange where you rung the bell, you invited me, which was one of the great great things that I’ve done in my life.

Thank you so much for that.

But, um, for someone who’s been in this industry for so long, what is, what, you know, why do people, why should they be in gold? Frank Holmes: Well, gold is, is a rudder.

And, and you’ve gotta think of it, or a ballast in the sailboat.

So when the wind hits, the sail doesn’t tip over.

Uh, and I think it’s really important that smart quant people like Ray Dalio, the largest hedge fund in the world, he has a 10 to 20 up to 25% on his parity trading gold as an asset class.

Uh, I I, and I think that it, it’s proven exceptionally well this century, in the past 24 years, gold has outperformed the S&P 500 two to one.

Uh, that’s, that’s pretty compelling as having his 10% of your portfolio and rebalancing each year.

Uh, I think that what we have to realize is that, the strongest currency last year was the US dollar.

And, and if you looked at previous times how high rates went last year, the 10 year, the five year, and the two year it, it suggested based on previous cycles, gold should be like 1300.

It didn’t collapse.

It actually was pretty stealth.

It was very resilient, on that, just that currency play.

And, and I think that that was a, a reflection of so many other central banks coming in to buy gold was a another important factor to that.

So I, I think on that, the protection against the dollar, gold has done exceptionally well.

Now, going forward, going into an election cycle, fourth year, how much money printing, how much they’re gonna panic over the economy.

Uh, it suggests that gold can be $4,000 on my models, for simplicity.

And, and I think right now we’re starting to touch negative interest rates.

Uh, it’s better to buy dividend paying stocks than than a five year government bond now.

And, those rates are going negative.

So, anytime that happens, buying quality gold stocks.

And by the way, I’m really happy and thrilled with GOAU I don’t know if you’ve looked at his performance relative to the GDX and GDXJ since we launched it with the New York Stock Exchange, but that quant approach to portfolio construction and that per and the stock picking factors, it’s outperformed a market cap weighted index.

It really is high.

They call high grading looking for those factors.

So it’s when as a gold holding, you’ve gotta put it up against the GDX and GDXJ, which have the most money in gold equity ETFs and it’s done what a city would do.

And so hopefully touch wood, touch wood up here that it will continue to, do it, outperform a basic market cap index.

Frank Curzio: Well, I mean, it’s outperformed ’cause Frank and I, I’m gonna give you a little credit ’cause you’re great at what you do, right? I mean this is, there’s a lot of methodology.

We’ve covered this and I love this part.

I don’t know if I wanna bore everybody out else out there ’cause unless you’re an analyst, but I really appreciate what goes into the work behind this.

And you can see that you loaded up 30% here mostly on royalty companies.

What’s it gonna take for say, the next three, right? Say Sandstorm or even ocean goal, the army to those that become the 10% weighted.

Because it seems like when I look even at the big guys, right? You think, alright, prices are gonna go higher.

These are producers, these aren’t the small amount that aren’t producing anything.

Junior miners, even in mid tiers.

But the inflation costs, have gone up tremendously.

And I know that’s probably starting to, to to, you know, top out, maybe go a little bit lower, but that’s really hurt their margins even as prices have gone up, but not really that much.

You could look at three years and, and we were, you know, 18 50, 1900, you know, what’s it gonna take for some of the, the producers to actually get into the top of your portfolio? ’cause that’s what people wanna know.

Where, where, well, if not all gold prices are going much higher, it should be really great for the largest producers, right? Frank Holmes: The, the, the models constructed with three, three pillars.

One is what is the best business model in that industry? And and the best business model that’s much more like a technology company is the royalty model.

The royalty model is very much like a SaaS model of recurring revenue and they have much higher margins.

Uh, the revenue per employee of Franco Nevada is $34 million.

Uh, they have royalty on Barrack and Newmont assets in Nevada where the average revenue is $600,000 of revenue per employee.

So they, they have a much more agile business model.

And, and so that is, has been a great performer.

Then we looked at, when we created this, this beast here and we spent 10,000 hours, of, of looking at a factor.

And, and there was at the time about a hundred gold producers around the world down to about a $50 million market cap.

And we said there’s a hundred different factors.

What works, what doesn’t? So debt to equity is a good stock screen.

It’s not a good stock picker.

Alright, well what is a good stock picker? A good stock factor for picking stocks is something that can capture momentum or something that is at a deep value Warren Buffett style discount.

Alright, so what are those factors? And, and I’ve mentioned this many times.

Gold analysts never call us up and say, I love this story because it has the highest free cash flow Yield.

They never do that.

And guess what, if I just pick the out of the a hundred skull producers and now there’s like 85 of them ’cause of mergers, et cetera.

Uh, if just the top 10 who have the highest free cash flow yield, I, I outperform everyone.

But you can’t run a per mutual fund or an ETF portfolio with only 10 names.

You have to have at least 21 names.

So it’s interesting that that factor is very compelling for stock picking.

Now momentum, um, and I’ve said this several times at go speaking at institutional goal conferences, revenue last quarter over the average over the past four quarters is more predictive of outperformance.

So that’s momentum.

So when the last quarters above the four quarter average, it means either the price of gold is rising and the production is rising.

And, and, and what always shows you is that the quant world is much bigger than the gold industry.

And the, and the quant world is agnostic towards this.

Any industry, as long as revenue is torquing it up is growing.

And you can think of Apple when Apple’s Phone was taken off, it took off.

Uh, it had this incredible run, in a short percentage time because it was growing with the momentum of the iPhone.

Uh, you, you get hot products.

Well, in the gold mining business, you don’t, you know, when I’m projects gonna come on stream, the simplest way is to look last quarter over four quarters, is momentum that that usually far outperforms other, um, factors, You know?.

Frank Curzio: So I’m gonna get a little, deep here in the woods.

I, I, because what you said.

Frank Holmes: Is that Too? Is that too complicated? Frank Curzio: No, no, no.

That, that I’m gonna get complicated because I wanna I wanna run this by you.

’cause this is a question I I have and hopefully my listeners could, could understand where I’m going with this because I agree with you when it comes to momentum, you know, when you’re looking at the quant funds, you have momentum or you’re gotta have a Warren Buffett style with the deep value.

And I get that right? That that’s what we’ve all, you know, a lot of us been taught that as well, right? Like earnings drive stock prices.

You brought up Apple though.

Apple year over year barely grew their earnings six 11 to like six 13, 6 dollars 13 cents.

Sales are down 3% year over year.

Yet this is a company that added a trillion dollars to its market cap this year.

Do things like this that net you didn’t really account for something other than the two things that you mentioned.

Two variables, two factors that you mentioned that drive stock prices.

Are there other things that make you update your model? ’cause for me, as someone who’s been doing this for 30 years, I look at that and I scratch my head and like, why would you buy Apple? And it’s not cheap.

It’s at 30 times forward earnings.

It’s not growing earnings, it’s not growing sales, yet you saw a massive amount of money pouring into that stock and other, the Magnificent 7, but a lot of the others compared to Apple are growing earnings pretty fast.

Do you update your model when you see things like that? Or is that something that, that you expected? Frank Holmes: I I think that liquidity begets liquidity and, um, and because ETFs now dominating trading between stocks and ETFs and the quants of how they arbitrage every number.

So you get this accelerated looking for liquidity and a lot of these hedge funds that are in the quant world leverage their balance sheet, and, and carve out basis points.

so we have to recognize, so where are they gonna go for liquidity? Uh, someone like Apple’s has liquidity, and if you look how strong the dollar was, mm-Hmm, it, it’s why the earnings were, the revenue only grew by 3%.

I mean, it fell 3%

In fact, if it was exactly the dollar rise, they would’ve fallen more.

So interesting.

On a relative basis, I thought that Apple did well with this currency move.

Because when you’re in the gold world, you really have to follow foreign currency moves.

You have to follow two year government bond yields on a relative basis.

And then you, when you look at the Magnificent 7, you have to say, well, what would happen if, if if the the dollar had declined? What would the revenue look like converting back.

Their exports would’ve been greater.

So it’s, it hurts the exports.

Remember, these other countries have weak currencies.

They’re selling strong into emerging markets and other places, but we convert back to the dollar, it doesn’t look so pretty.

And, and, and it’s trying to deal with that, that that movement to understand it.

But coming back to the gold stocks, is is that the, the gold universe is tiny.

Really respect is tiny.

Yeah.

So why do the companies which have revenue last quarter of four quarters outperform the GDX and GDXJ and even GOAU and that concentrated portfolio, why would that happen? It’s because of other buyers where sup demand is greater than supply.

And, and there is a whole universe of quant trading desk that look for that revenue momentum, and they’re agnostic of the industry.

Uh, and, and so I see that, that some of that money would come and flow into, the, the gold space.

And that’s where we think those gold stocks, that’s why they outperform.

So it’s one of the factors we use, and, at GOAU.

Uh, and, and it’s for people to understand, I’m looking for high free cash flow means the stock’s very, very cheap.

So therefore it means it probably taken over ’cause the yield because it has a high free cash flow, or it can .

Buy back stock or pay bigger dividends, or it can expand.

Its, its operations.

But quite often when that big free cash flow just remains cheap, long, someone takes ’em over a and, and so then that’s mean reversion, they call it in, in the world of physics.

And, and the other one is inertia, Newton’s law of of momentum.

And they’re the two big factors going back and forth of physics that are applied to, GOAU.

Uh, and we try to balance that.

But the, when we look at the other, the tech, the tech sector like you just mentioned, if you back out, like I said earlier, the dollar moves, you can see, I said to you earlier, gold did exceptionally well, on a historical basis.

And, and in fact, Apple did exceptionally well.

Uh, if you did, if you normalize the dollar.

Frank Curzio: So before I, I get to the next topic here, I I wanna ask you, you said 4,000 gold with your model.

When is the timeframe for 4,000 Gold? Frank Holmes: I think over the next couple of years you’re gonna see that, um, these, these cycles last, these interest rate cycles, for them to fall.

Uh, it’ll take, after that it’ll take another six to nine months like having a baby before you start getting that inflation creeping back up.

And then policymakers will slowly then move after that.

So nine months plus nine months is 18 months.

So you, you can see this sort of .

This baby cycle happening and it, and it doesn’t happen quickly.

Uh, and, and so one of the things we put in all our perspectives is that US Global is that we believe that government policies are precursor to change.

So we monitor, particularly the G7 countries and look at their monetary and fiscal policies.

And it’s really simple.

It’s all binary.

So think of it, how do you look at policies, monetary, fiscal, there’s a lag.

There’s always these lags between the implement and there’s bad policies and good policies, but even with a good policy, there’s a lag before it gets traction.

So it’s to recognize that.

And then when it comes to monetary policy, it’s simple real interest rates and money supply.

Well, money supply printing hasn’t really started yet.

Uh, but now we’re going to negative interest rates, which is bullish for gold.

Uh, over in fiscal policy, we see that the taxes and regulations are actually the EPA and all those regulations, they’ve distorted the lifecycle of a mine.

What used to be when I first got in the business in 1978 before you were born, Frank.

Frank Curzio: No, no, I’m older than that, believe it or not.

Go ahead though.

I appreciate it.

Frank Holmes: Well, you look younger.

Frank Curzio: Thanks buddy.

Frank Holmes: It’s the lifecycle of a mine, which has now become the

Life cycle people of a mine.

It is was about nine years.

You had a discovery, the stock ran up, then the stock fell and corrected.

You built the mine, you got the permitting, and it took about nine years from data discovery to you’re getting this cashflow.

It’s now 30 years.

Hmm.

So the supply is not coming.

But you know what, there’s a billion people having sex right now in this world.

and there’s gonna be a lot of more babies.

So the world’s gonna continue to have babies and, and, and, and that supply of, of gold from the gold mines is not gonna, for all the mining actually is not gonna be there because the restrictions and the difficulty is, is basically distorted that that yield, that that length of that.

And, um, and so it makes it very different when you’re looking at microcap gold stocks.

Uh, you, you’re, it, it, that whole space is very different.

But what we do know and with triggers Bitcoin, is because Bitcoin’s capped at 21 million coins.

Uh, over 19 million have been mine.

There’s only 2 million left.

There’s no more than 21.

If you all of a sudden capped gold mining supply, no more supply, gold would would be 10,000.

Uh, and, and it’s recognizing what they call another rule, Metcalfe’s law, that if you limit supply and people adopt and believe in that as an asset class, it grows exponentially in price.

So we’re seeing that right now.

What’s really growing is the recycling of gold is growing.

That’s where the supply is coming.

It’s, it’s not from the new minds of big, big new mines coming into production.

Uh, and where, and if you look around the world, it seems to be Africa and where brilliant minds like Robert Freeland are, he’s in Africa.

Well, why do you think he’s in Africa? Because the life cycle of a mine is not 30 years.

There, you have a discovery and you can quickly see how fast they can get permits through.

And they will do them with standards of North America.

They’re gonna do with is SO 1401, environmental, policies?

That’s what freedom always uses.

That, so it’s gonna have the highest standards of North America, but you’re not gonna go through the bureaucracy.

And that’s where that growth is.

Now you run into these geopolitical risks of Al-Qaeda’s running around, et cetera.

So that creates a uncertainty.

But if you were looking for any new supply, it’s gonna come out of places like Africa.

They’re, they’re not gonna come out of North America.

Uh, and, and that’s so, but the people continue to have babies.

And, and so I, I think that, that this sort of supply demand is very bullish.

Uh, and the other big change is, is the demographics.

So younger people, much younger than you, much younger.

Now, you told me much, much that you’re over, you’re more than 45.

Frank Curzio: 50.

Frank Holmes: Uh, you’re 50 50.

Well, that younger audience, they’re, they are gamers.

They’re used to, earning digital money.

The, the, they’re easier for them to adopt a Bitcoin.

And so that whole ecosystem, than my vintage, my age, .

At 68, you know, it’s just, it’s like so foreign that they’re still into the, into gold, but that younger audience, so we’re gonna see a massive transfer of wealth from my age to kids age.

And that’s gonna have a big investment opportunity.

So one has to take a look at where are those new opportunities, and along of ’em comes AI.

Uh, and that’s now a new game changer, in, in the development.

So I, I think I remain so bold that there’s just so many, you know, unique opportunities.

Uh, you have to look at supply demand of a commodity, just like I said, Bitcoin, you have to, take a look at the new technology, how it’s gonna be disruptive, and, and you gotta look to bet who, who are gonna be the new superstars.

Frank Curzio: And speaking of all the babies, young, you, you touched up on it where I was going.

The reason why I’m looking, ’cause I’m going to your Frank Blog right now because you wrote about this, and you wrote about big five keys, Bitcoin, digital asset trends to watch.

So one of those things is you see Bitcoin going a lot higher.

And I guess even before we get to that part, when I look at, at the younger generation in Bitcoin, for me, I see that anyone that is under 40, I feel like Bitcoin, Bitcoin is gold to them, except like you said, you have this capped amount and every four years, halved, which automatically is gonna, it’s the reason why Bitcoin goes up a year into the halvings every four years and a year after, you know, ’cause you’re reducing supply growth.

But for me, I’ve always saw the demand after two years, you know, the demand kind of tails off.

And then it’s, it’s created this cyclical industry kind of cyclical with Bitcoin now that all these ETFs are coming to market, explain what that means.

’cause I think as well, people know that listening to me of how big of a deal it is, and it’s a game changer, I believe is turning this into a, a secular market now where you’re gonna see demand like you’ve never seen before.

And people having access to Bitcoin, they’ve always had access, but this is gonna be much easier access for the first time without wallets and things like that.

How important is that to the price of Bitcoin and where do you see it going? Frank Holmes: Well, it’s, it is a great question.

so I have to go with my Gold World hat.

And, if you look at the date that the GLD came out, it was a, it was a significant sort of revolution for institutionalization of gold, that were never players before.

And, and it was 2000, Frank Curzio: Basically four, right? Frank Holmes: Right.

Frank Curzio: Okay, good.

Good.

Frank Holmes: And it so performed, you know, the, I said the S&P earlier two to one

it, it also gave more comfort because when I first bought US Global, the regulatory world were always anti gold and gold stocks, and it was always bad characters, et cetera.

Uh, and, and I think in 2015, um, there was a bunch of policies that came out of the White House to go after anyone who was in the coin dealer business.

so there’s still that sort of anti gold.

and, and so what I did see was the, the adoption of GLD, took gold up about fivefold, roughly speaking of, fourfold four fourfold increase.

as, as more and more people use that as a proxy, it hurt the gold stocks.

And why did it hurt the gold stocks is because the gold stocks at that time were all trading at very lofty valuations.

they were buying each other.

There was no respect for, cashflow return on invested capital.

Uh, it was just who, it was a, it was a, a run just to get size.

And, and along comes investors buying billion and those gold stocks that did the poor job of protecting reserves per share, cashflow per share, revenue per share.

They got clobbered and gold stocks started to bifurcate.

And you could see that 50% of the gold stocks were just getting knocked down, down, down.

And they were pulling down the GDX and the GDXJ.

Uh, and you could see massive dilution on the, on the shares of all these acquisitions.

And only the really, the royalty companies and some of the other ones were very cognizant of, of good corporate governance, for cashflow return on invested capital.

I think that’s what’s gonna happen, with Bitcoin.

The Bitcoin ETF is gonna create this right now as a big sort of rat race just to sell shares and buy ASIC machines and get as much Bitcoin on the balance sheet, production you can, and it doesn’t matter how many shares you issue, there’s many of, of, HIVE’s competitors that issued 200, Uh, and, and at this stage, Mr.

Market seems to be using them as that proxy HIVE has been much more disciplined of the least amount of shared dilution, with the steadiest cash.

’cause I, as, as executive chair, I run it like, like as an ETF or like, as very, very frugal in how we make decisions and look for high margin business.

So I think that you’ll see that ETF comes out, it will separate the miners like the GLD did with the gold stocks and only the best leaders, the best executives will outperform.

what I also think is that you have to recognize is that gold and Bitcoin are decentralized assets.

So that’s very, very significant.

They’re not controlled by any one central bank.

Two is, they fall in the category as alternative asset class.

And some money managers, many wealth managers have 3% up to 15%, 20% depending on your age, in alternative asset classes.

So I think that the idea of having 1% going to 3% as alternative asset class will be bullish for Bitcoin because it is capped at 21 million coins.

Uh, and, and I, and I think that that will be a factor that will drive the prices higher.

but between now and when that happens, there are still tremendous headwinds, and is very political.

and, and, and we saw, the presentation by Elizabeth Warren, with Jamie Dimon, and she doesn’t like the banks, but Jamie Dimon and her both are anti Bitcoin.

Uh, and, and all of a sudden, two days later, she comes in with 300 regulation rules.

And it’s not really just a shut down Bitcoin, it’s a shut down Web3, it’s shut down blockchain.

So then it comes in with another politician says, that it was the bank lobbyists that pushed this agenda, and they’re the ones that wrote all those regs of rules.

There’s no way you can go through a question and answer period, and two days later come out with a draft of 300 regulations of rules.

So it’s a very much a political, um, debate and discussion.

Uh, I’ve tried to understand it more.

Uh, I believe that there is some factor from the Bank of International settlements.

Uh, they don’t care as long as that central bank, even if it’s a rogue nation like Venezuela, long as they do their trades for them, they don’t care.

it, it, it’s recognizing that they have been on a regular basis speaking anti all over the world about Bitcoin and that because it’s decentralized.

And for your listeners, what’s interesting is that there’s a little over 200 countries, and there’s really maybe a hundred functioning central banks around the world, I call really functioning.

And, and out of those that, um, are sophisticated and functioning, you gotta compare that to how many nodes are decentralized validating the Bitcoin ecosystem.

Wow.

There’s over 10,000.

So it’s very decentralized and, and it makes it very hard for a, any one government or any one banking organization to come in to take it over.

And, and so it becomes very much a political debate between centralized, decentralized, private property rights, government property rights.

And, and so within that, you come with the advocates of climate change.

Uh, Greenpeace has been funded to do a big knock on, Bitcoin mining and why it’s bad.

So it’s become very much NGO politically motivated.

Uh, but what I really think is fascinating to me as I sit back and observe this, the, these developments, is that it’s very decentralized.

And, and it’s, and it’s big.

It’s bigger than anyone ever thought, bigger than I ever conceived of in 2017.

And, and I go to these conferences, and I’ve mentioned this before in your program, that you and I have spoken at conferences in San Francisco and in Vancouver, and, and it’s a free ticket and they get 2000 people out.

Well, you get 30,000 people at a thousand dollars a ticket coming out.

And they’re not institutions.

Yeah.

Like, there’s, institutions are spending 10,000 to have their own special seating, to be not with a riff wrap, as they call it.

So in Amsterdam sold out Prague, um, there was a hundred thousand people in Lisbon in November, a hundred thousand.

They put it into a football stadium.

Uh, and they spent like 300 euros each.

Like, so there, there is something happening outside of our normal capital markets.

And those people, as you mentioned earlier, they are all gamers.

They’re all used to digital money, not monopoly money.

Uh, they, they have a, a a different view of the world, and they’re gonna inherit baby boomers like me, our wealth as trillions of dollars are gonna be turned over.

And so I think that the smarter politicians are, are recognizing that, and they have to turn around to make sure they embrace the technology.

Uh, they’re gonna, and I, and I think that we’re just gonna have this volatility.

So sentiment drives it.

Oh, the ETF’s coming out next week, Bitcoin’s up $10,000.

Oh no, it’s been delayed.

It’s down $7,000.

Uh, it’s very sentiment driven.

And, and some smart people believe that the, Gensler is not going to, push it through.

He’s gonna find ways to delay and dis and disappoint the market because it’s, it’s a big political agenda and is coming from the banking lobbying of course.

And so the bank lobbying group are very powerful.

Uh, and, and we can see that.

So how, when it happens, I don’t know, Frank, but I think it will happen because young people embrace the digital world different than the baby boomers that dominate Congress and the Senate.

Frank Curzio: Now, you talked about the miners, the Bitcoin miners.

Right? So, which not, not the gold miners, Bitcoin miners and you’re executive chairman of, of HIVE Technologies.

A couple, like you said, in 2017.

Frank Holmes: I changed my hat.

Frank Curzio: There you go.

There you go.

You’re very familiar with this industry.

Talk a little bit about this industry where, and just with, with the Bitcoin halving, means.

So, ’cause you just reported actually positive news for the year, you could talk about that as well and start there.

But, just for people who aren’t familiar with the, with the miners and the industry of the miners, go into that a little bit and, and, and what have you seen over the past, you know, since 2017 with miners? ’cause this has been an industry that, I mean, skyrockets gets annihilated skyrockets.

And, and a lot is based on where, you know, Bitcoin, you speak Ethereum’s going, but, talk a little about that industry.

’cause you are really, I mean, you speak at conferences, you talk to everybody within this industry, which, which is great.

Frank Holmes: I’m a member of an organization, which has been so helpful for me because it’s peer-to-peer learning.

And you know that Bitcoin is peer-to-peer, transactions around the world.

Like I said, more 10,000.

Well, this is peer-to-peer learning from each other.

Like you.

And you and I get together and, and we discuss family and business and all the complications in our journey.

We learn from each other.

And

And the peer-to-peer group is called YPO, Young President’s Organization.

Uh, to be a CEO, of this is, it’s really, I I go every year for a week at Harvard.

Uh, I do case studies.

I have to put 60 hours of research reading into it.

And then we spend 60 hours in class.

Uh, and we learn from each other where the trends are going, et cetera.

When I first went into, in 2017, basically co-found HIVE, and it became my, ’cause I recognized, and it still hasn’t happened in ETF

There was not there at that time.

It was not gonna happen to be an ETF in Canada, the US And there still hasn’t happened in the US.

So, HIVE, because there’s no KYC or AML problem because we mined the coin.

I, I said, okay, I’m gonna seed this.

I’ll put up capital and put an institutional umbrella around it.

Uh, and, and so that journey, what, what I’ve seen is that there, one of the 30,000 CEOs of this organization, there was only four for the embraced crypto four or the 30,000.

Wow.

Today it’s a thousand

And the CEOs of most of the miners are YPOs Now it is incredible.

We

The c that YPO HUD eight, Jaime Leverton, YPO, Frank Teel, Fred Teel, Marathon, YPO.

Uh, so it really shocked us earlier last year when we had a group meeting in, in Miami and someone that tallied up that we’re about 40% of crypto mining globally.

So you are now seeing professional CEOs and chairmans coming into this or into this organization.

Riot was a scam.

They just tried to follow HIVE after HIVE’s success.

And, and, they all got thrown out.

And the SEC went after these bad characters.

Now it’s a very professional business.

And, and Benny as, who’s the chairman, he was tutelage under, Ned Goodman, who’s a, a famous c you know, Canadian, um, mining guy, one of the most famous Canadian mining entrepreneurs, that, who passed away recently.

But

You look at their lead is Hubert Marlowe.

Uh, he learned under Ned Goodman.

Uh, Ned Goodman was my mentor.

Uh, I I I, it’s really fascinating to me that the CEO of Bitfarms, he was also, with him.

So you, you, you’re seeing that high professional capital markets expertise has come into this industry.

There’s governance in this is in, in this industry.

And, and I think that it, it lends itself as, as being, very conscientious about when Marathon, when Fred took over Marathon, immediately got rid of all the coal.

I didn’t care about coal before.

There’s no coal.

There’s no coal energy coming from them.

And, and it’s, and so you can see how the, the business has become very professional.

Frank Curzio: Uh, so you talk about the mining, the, the miners.

Right.

And, and I wanna bring this up.

’cause this is your five predictions, guys.

You can go to US Gold.

It’s called Frank Talk.

He writes every week, has great stories on here.

Really, really cool.

Uh, and you just came out with this one, December 18th, five key Bitcoin digital asset trends to watch in 2024 and get, you can go there, it’d be a popable, you could sign up and get this in your mailbox box.

The second one interests me because you, you know, HIVE is, you know, a little bit small than, than, than some of the, some of the, the major players here.

Uh, but you’re saying how they’re gonna struggle survive after the halving where, you know, that’s coming in April.

And that means where, you know, I don’t wanna get too technical.

People are not familiar with the industry in terms of, of hash rate and the difficulty of mining, but it makes it more difficult.

And now you’re seeing you need powerful computing systems.

We know that a lot of ’em use Nvidia chips, Ant Miner and things like that.

And those chips are super, super expensive.

So, you know, there’s this whole competitive thing, but it also gets a lot harder at, after every halving.

And this halving is coming up and you’re saying smaller miners are gonna struggle to survive after the halving, you know, what do you mean specifically by that? And how’s that relationship to HIVE? Do you think you’re gonna be one of those that, that, that are sitting there and one of the biggest beneficiaries, or.

Frank Holmes: Well, we’ve, first of all, we’ve lived through, halving and we prospered going through the halving, um, we have lived through where Ethereum went from proof of work to proof of stake, and it was a very high margin business vaporized.

and so we, we understand, I think these difficulties and we’re a little more, I think, resilient.

What we found in the other ha the first halving is that we had a mining Ethereum at the time, and Ethereum was always a much higher margin business than Bitcoin mining.

And so we were able to be profitable going through that, that transition.

But what we did see is that a lot of the junior miners, um, at that time, both private and public, did not upgrade their equipment.

And what that halving does is basically saying for listeners right now, today, there are about 900 new Bitcoins being created a day that is, and HIVE is about 1% of the global network, like nine, nine Bitcoin.

And, and so when, when we look at, um, that, that, that having says you’re gonna go from 900 to 450 coins, well, your revenue’s gonna go by half, it’s gonna drop by 50%.

The only way to survive that is for Bitcoin to double in price.

Or you to have more efficient machines.

And a lot of people mine and sell all their coins and live off of that lifestyle, and they don’t reinvest fast enough in the new, more efficient machines.

And so you’re seeing that a lot of the bigger miners are talking about all the spend they’re doing.

And same with HIVE of upgrading less efficient machines.

At the last, halving, we increased our foot size, we went from basically, very little 250 petahash of Bitcoin mining, to four exahash, that’s, that’s like four 16 times increase, in a number of what, from what we originally were, because we were able to acquire facilities that other people basically had to shut down their business.

They couldn’t do it.

And we bought, I remember, 9,000, um, S19s for nothing.

Uh, just take over the facility and start bringing in new Bitcoin, new Bitcoin machines that are more energy efficient.

Uh, we were able to do all of that.

And then we bought GPU One, and, and, we’ve expanded their footprint and we own the data centers in New Brunswick on our balance sheet.

So those, they create opportunities.

Uh, and, and there, and there’s lots of private miners, that, that have sold all their coins.

They don’t hold, they don’t run, big cash management.

Uh, for us, we always make sure we have cash in the balance sheet.

We always have Bitcoin on the balance sheet, and we’re very conscientious of how we run, for our key factors, capital return on invested capital, how we deploy the capital.

And, and, and I just see that you’re gonna see a lot of these miners don’t have access to the capital if you wanna borrow.

the cost of borrowing was like 18%.

Uh, and a lot of people got into problems last year and the year before because they borrowed from these, these predator lenders in San Francisco, New York City, I mean the two big epicenters of predator lending.

Uh, and, and, and they pull the plug and, and created the biggest bankruptcies, you know, in that, in that industry.

So HIVE does not do this lending.

We don’t, we do not borrow, we never pledged our Bitcoin.

We never got pulled into FTX or Celsius.

And, and they kept knocking Celsius, you know, lend us your coins and we can make a lot of money on it.

We didn’t go down that path.

and so I think that, that the successful miners are gonna do much better.

Uh, marathon has gone abroad.

They’re, they’ve gone to the Middle East, the, the Middle East and, and the Dubai region, to expand their footprint and diversify the geopolitical risk of, of anti Bitcoin mining in America.

HIVE is in Sweden, Iceland, and Canada.

Uh, we’ve explored several facilities in, America, but we’re really conscientious about having green.

But we think there’ll be opportunities, and those start to unfold in the next, it really starts to happen next month, February, the panic buttons will start happening with those miners that do not have the capital.

Frank Curzio: So you guys have, I believe I read seven, is it 1700 Bitcoin that you have on the balance sheet? Is that correct? Frank Holmes: Yep.

And it’s now, we’re now holding, we raise money going into the year end, uh

To buy more machines to fast track.

Uh, some of the older machines we have, the Cannons, which are very profitable.

We’ve got our money back a couple times over, but they’re not energy efficient when the halving takes place.

So, that’s what we have to be so focused on.

And then our HBC is so exciting.

I, it’s really exciting because, if you look at valuations, it’s very hard to go buy a peer, AI data center.

And it’s very hard to buy something that’s, if you want to go buy Microsoft the data center business, or you want to go buy Amazon, it gets lost in a huge conglomerate.

And when you buy HIVE, you’re getting this ramp up.

And when we did our beta testing, we said last year we did a quarter million the first quarter, and now we hit a quarter million a month.

when all of our machines, um, video machines we bought, which we got basically our money back now are, are going, moving over and they have to buy new racks.

You have the special racks

Uh, or super micro racks.

So a rack costs you like $15,000.

I’ve seen Frank Curzio: One of the facilities Yeah.

Frank Holmes: And you could Ships into it.

But then there’s the magic, it’s building a, a corpus callosum, the, the, the fiber optics between your left and right hemisphere of your brain.

you, you have to build that and, and people rent you, they’ll rent, they’ll pay you more per hour.

So right now, for simplicity, making 15 cents an hour

Mining Bitcoin and it’s a dollar 50 doing HPC.

So it’s much more like what Ethereum was.

And so it’s this transition we’re going through that what we suggested our beta tests would do is working, and, and come by our year end is March 31st, that we should have hit that, that that milestone.

And so we, we feel that going into the halving, we’re gonna have another very profitable part of our business.

Uh, we’ve noticed that several other mining companies have announced buying Nvidia 100s.

but first of all, they’re, they’re not preferred.

Uh, two is, they have no idea.

Frank, it’s so complex.

I had no, I this time last year, I had no idea how challenging it would be.

To buy these racks, put the machines in.

it, it, it’s like the, the pages to hook up your computer may be, you know, 20 pages, with all the cables and wires for your stereo system, your computer.

And you think of that, it’s a thousand pages.

So you, you have, it’s, it’s, you’re basically building a brain to do this AI work.

Uh, and it’s fascinating.

But we’ve come through that and, um, we have seen our revenue, we’ve, we’ve been public about it, of growing from a thousand dollars a day to $5,000 a day to $10,000 a day.

So it’s continuously growing as we do this transition of Nvidia machines, mining, altcoins converting to Bitcoin, we make much more money putting them on, our HPC model.

Frank Curzio: Makes sense.

Makes sense.

So, so final question here, and, and I love that you explain that, ’cause just the whole mining industry is fascinating to me.

Uh, and you’ve been in it for a very, very long time.

So, where do you see Bitcoin going and, and you know what, these ETFs are likely gonna get approval when I see Fidelity coming out and saying, the fees are gonna charge BlackRock, telling you how they’re gonna see their capital.

And you have, Goldman, JPMorgan saying, Hey, you know, we’re going to, basically be managing these things in terms of making sure the trading and efficiency and stuff like that.

Like everybody, you don’t see those steps taken unless, you know, they’re pretty sure it’s going to happen.

So say it does happen in the next few months in the Bitcoin half thing and everything, you know, where do you see, not maybe this year, but over the next couple of years, where do you see Bitcoin going? ’cause I would think that’s gonna be great for the entire industry for miners obviously.

And also a lot of altcoins who, you know, they call ’em s**t coins and there was so many more before FTX, but right now the technologies that I’m seeing within 10% of this industry, that’s, it just fascinates me with like getting blockchains being able to talk to each other without bridges.

Now it’s, you know, there’s just so many companies.

It’s Gamefy, it’s Dow it, it’s deep in it, it’s so many different things that I know you you’re familiar with, but where, where do you see Bitcoin going, I guess, in, in the next couple of years? Frank Holmes: Well, I, I, I think it’s, it trades substantially higher because the ecosystem is so much bigger.

Uh, it’s outside of the normal buy stocks and sell stocks capital markets.

And I think that fusion will be, of epic proportions that when people say a quarter million dollars, it’s very feasible.

when I first started looking at being green coins, I said, Bitcoin that’s green is gonna have more value.

It’s gonna become like Andy Warhol art, or like a print I have of, of a Picasso back here.

you know, that that came out probably at a hundred dollars and goes to 10,000.

It just give you an idea that it more people adopted that they wanted to own one of the original of Picasso and it, and it goes up exponentially.

And that’s all based on Metcalfe’s law.

if there’s a bad economy, these, these are deemed alternative asset classes behind me, they’ll go down with the economy, go up, but they’re, they have a uniqueness to them.

And I think that, that for the listeners is to recognize that.

And one I mention about the green, we’ve been offered more for our Bitcoin from Green Energy.

Two, um, these, one Bitcoin gives you 100 million Satoshis.

So that’s like point, 0.

04 cents

Now what’s happening with, this time last year was a, a brilliant person that was able to figure out how to take this Satoshi and attach your picture of you holding your hands dog the hand of your daughter.

So you can go back and you can find the Satoshi that day that your daughter was born, and maybe you can even find that Satoshi of that hour.

All of a sudden, what is worth 0 0 4 cents is worth $10.

I mean, think of buying a penny, stock 0 cents and next trade is $10.

Like, that’s massive.

Frank Curzio: And you’ve seen that within crypto often.

It’s not you, you’re not, you wouldn’t, like you could cherry pick.

Frank Holmes: Absolutely.

They’re called Often.

They’re called Oros.

Auto Knows.

And, and so we’ve seen the revenue we make from our infrastructure, and the Bitcoin network.

Uh, we have it, it, it, it really is.

And you can attach, a peg file to it.

And, and so the big adoption’s gonna be that.

So not only having a picture digitize a view and your daughter or your wife, at this special precious moment that you’re celebrating your 20th wedding anniversary and, and you want this special, picture gold plated.

Well, how are you gonna gold plate it in the modern world is gonna be attached to a special Satoshi.

So all of a sudden these Satoshi’s we get offered for, I think it was a quarter million dollars for a hundred of our Satoshis.

Like unbelievable.

So if that is happening, then that would say as Bitcoin adoption takes place, it trades much higher.

Uh, and, and, and the generations X, y, and z and millennials are much more accepting of the digital world.

But then we have, you know, Netflix I watched last night, Bitconned, about the scammers that, that we’re

It should not be called Bitconned because it has nothing with Bitcoin.

Uh, and it’s, it’s the ICOs, and, and I think branding from trying to tarnish the industry and it’s really how many bad characters.

The biggest thing I could share with you that I’ve seen from a regulatory is that no, anyone in this industry has to get an audit.

And, and, and you can see that it’s been very difficult for, to get a big audit firm.

And, and the accounting board has made it very difficult going after anyone that goes, that wants to, even for clean Bitcoin mining companies.

and, and some of some people that have, hedge funds that are in that space, they’re finding it so difficult.

So these characters, you, you need, you need an infrastructure that they, if they’re going to go into this industry, there has to be some type of an audit process.

And that chases away really quickly a lot of these bad characters that had nothing to do with Bitcoin, nothing to do with, but they, the crypto ecosystem is growing.

and, and I think that, the former head of the SEC Clayton did a phenomenal job chasing down these ICOs.

I mean, he cleaned out Dodge and there were so many bad characters.

’cause I remember when launching HIVE in 2017 that you would go to some of the conferences, you’d see IBM people, you’d see really professional people and coders and, and, and engineers.

And then over here you’d have the riffraff promoters that wanted to have their Lamborghini.

And it was all hype.

I, I, I think a lot of that is gone.

I, I think that’s all been cleaned out.

And, and I think I, I really clap for the, you know, the regulatory world of, of going after those characters.

Uh, but the ecosystem, is real.

Uh, the fact that it works 24 7 banks are on holiday.

Uh, if there’s an earthquake, you can still send the money to someone in, in Latin America or Japan.

You, it still functions, but not any other methodology is next to impossible.

I think the banks want to control everything.

They charge everyone exorbitant fees, that you can really see that debate now after it comes out that, that the, two big bank lobbying wrote all those regulations, for, senator.

And, and so that means that they’re very fearful of blockchain.

But then on the other hand, you have Fidelity.

Fidelity wants, all settlements on the blockchain.

But the whole back office on the blockchain stops illegal shorting.

It stops failed delivery.

So we see that, that sort of, that debate that’s, it’s a punch out match right now.

And, and I don’t want to get pulled into who’s right or wrong.

I wanna just get into how do we run a good business? How do we make sure we have good governance? Uh, how do we have the most efficient machines? And then how is HIVE innovating? We have, we have so many, we’re the first to do so many things.

Uh, a classic would be the ATM world, which is called for, at the market, market transactions to raise capital.

Uh, we’re the first to bring in two brokers on a cross border, all of a sudden, right? Comes in with five brokers on theirs.

Uh, it’s a, it’s half the cost of doing a financing, a normal financing.

It’s, it’s a much better mechanism or overall deployment of capital.

and we innovate that which why we’re the first.

Frank Curzio: Which is why, which is why, and sorry to interrupt you, is you’re hearing so much out of the banks because this is an industry where, you know, they try to hold it down and you can’t hold it down anymore.

But just, it, it disrupts the foundation for so many of these companies and banking companies and the fees they charge, because things are so much easier now.

So the, like you said, the, the bank.

Yeah.

Frank Holmes: You know what happened in Canada, this is interesting to me experience in the summer in Canada.

Uh, I, I, we meet with two big banks.

So five banks control 80% of all wealth management in Canada.

Five.

So they control the regulatory regime.

They control so much with lobbying that mechanism.

America, there’s 4,000 banks, so you have a little more diversification, but you do have some massive money center banks.

So with that, these two banks approaches and say, you know, we wanna work with HIVE, but we love your HPC business.

We, but we can’t, do anything with a crypto mining company ’cause the banks won’t allow it.

And I said, really? Okay, alright.

But we wanna sort of carve out your, your HPC.

And I said, really? I said, so who has that expertise? Oh, we don’t have it here.

You have to go to New York.

Because those five big banks have shut down FinTech in Canada.

There’s no real FinTech.

If the guy’s a real smart FinTech person, he goes to the US.

Uh, or he goes to England.

There’s no, they won’t allow a, a FinTech bank in Canada, but they have in England.

So it’s interesting to see, what happens if you, if you get a concentration of a big banks controlling the financial sector, that you get this, this moat that that really harms technology and the evolution of technology.

Just like the cab industry used to have two families owning all the licenses in a city, and they paid for their politicians.

They kept it all, and it was all disrupted with Uber.

So I think what happens is that the, the blockchain Bitcoin ecosystem is a threat and that it would disrupt.

It’s not gonna totally disrupt.

And I think it’s faster that they embrace it because it’s, it is just part of a new way of being able to do transactions.

And actually, they always say that bad characters use Bitcoin.

You can track Bitcoin wherever it’s been in the world.

You just don’t know if it’s between you and I.

But you know, everywhere it’s been, you don’t know that with a hundred dollars bill.

No, You don’t know.

If it was with, with a narco in, in selling drugs in Miami and then all of a sudden it’s showing up in LA and then it’s the same a hundred dollars bills, then in Spokane, you don’t know.

Uh, but Bitcoin, you can track where it’s going.

Uh, so there’s much more a ability, but the fact that it, it functions with a flow heartbeat of every 10 minutes, around the world, 24 7, doesn’t matter what religious holiday, it doesn’t matter.

Banking, holiday, it functions.

And I think that that’s where the global economy’s going to go.

Frank Curzio: Well, that’s great stuff.

So, so, if anyone wants to find out more information on you, Frank, how could they do that? Frank Holmes: USfunds.com.

I write at, US Funds, U.S. Global Investors.

Uh, there’s Frank Talk and there’s the Investor Alert.

So if you just sign up for Frank Talk, um, you’ll get some interesting, topics and discussions, um, that are not every day that you’re gonna read.

Uh, one of them I just saw is the immigration.

You see, the whole immigration, issue of illegals coming across the border.

and, and the political attack and the conspiracy theories.

All, you know, it’s, it’s Biden, but it’s really being funded by Russia and China.

you have all these Africans that didn’t swim across the Atlantic Ocean.

Uh, they, they were flown who’s flying them? What NGO who’s funding the NGOs? all of a sudden Italy stops, the new president of, of Italy says no longer they’re gonna do the China trade, Silk Road trade, and, they’re anti Putin evading Ukraine.

And immediately all these speedboats with people with life jackets on are coming across, of a hundred thousand people landed on islands off of Sicily.

Like who paid for that? and, and it’s to, it’s to, to disrupt.

So I write about those things and then I say, what investments? Where, how would you, what do you look at to protect your investment portfolio? Where are the opportunities, to capture? and that’s what I tried to look at these global factors, because I say that government policies are a precursor to change.

There’ll always be imbalances between monetary and fiscal policies.

And that arbitrage is where smart investors come in.

That arbitrage is when there’s big, long-term lags and gold shines, or all of a sudden gold is gonna be a a negative.

Uh, but what is really important for Bitcoin and gold is that the modern monetary theory, MMT and our good friend Marin Katusa, has written about this, and I think you’ve written about it too, that really took traction out of the UN and World Economic Forum in 2001.

And you can see that from that period on gold is outperformed the S&P 500.

The idea of universal checks for everybody, all these sort of socialistic models of thinking and that just use monetary model to do it creates big lags and, and distortions between monetary and fiscal policy.

And that’s where these alternative asset classes are important.

But you gotta remember, don’t eat, put all your money in.

I would never say that because you’ll get jal…, let’s get jalapenos.

You need to have some food jalapenos, spice up the meal, but don’t eat a plate of jalapenos because you’ll be sick.

Frank Curzio: Good advice, Frank.

Love having you on.

I mean, we went, you talk about global markets, the regular markets, elections, Bitcoin miners, yeah.

Fantastic stuff.

So, thank you so much for coming on.

Everybody always learns so much when you’re on and, and just, we love your energy too, so keep up the good work and hopefully it we’ll see.

So each other in person pretty soon.

Frank Holmes: And, and, who’s your favorite basketball team this year? Who do you think’s going on Frank Curzio: This year? Well, I’m a Kansas Jayhawk fan for college, but this year, I mean, you know, I’ve always been a, I can’t even say this, a Detroit Piston fan since Isaiah Thomas days.

So I’m just hoping that, yeah.

You know, they, they don’t, they probably could have the worst, yeah.

The worst losing streak ever.

But yeah, hopefully, they could pick it up a little bit.

’cause that’s pretty sad what they’ve been doing.

So not like your Spurs.

Frank Holmes: I was talking to some.

Frank Curzio: I love your future of Spurs though.

Frank Holmes: But, you know, one of the big parts we were talking about with, with Talk, it was some real basketball, professionals and, they were saying that when Tim Duncan came into the league and we had the Twin Towers that David Robinson was there, and David Robinson was a Navy, he was a military type mindset of discipline, organized and family and all those values.

He was a great mentor to these other stars that the Spurs brought in.

Like the Tony Parkers and the Gin’s.

Yeah.

Uh, and, and, and, and so we have this new young kid that’s a superstar, but there’s no one that’s like a Tim a a a David Robinson.

So I think it’s gonna take a little longer to gel.

Yes, you need a great coach, but you need to have that seasoned person that is so, great family values and disciplined like a David Robinson.

Frank Curzio: Yeah.

But I think he’ll come along.

He’s, he’s just an incredible talent, so, and he’s humble too, so it’s a, it’s a good quality, but, uh.

Frank Holmes: Most important.

Frank Curzio: Pop, bring him along.

Yeah, pops will bring him along.

Fine.

Hopefully so.

But I hear you Frank Holmes:Have a great year.

Frank Curzio: All right, you too, friend.

Thanks so much for joining us.

I’ll talk to you guys.

I’ll talk to you soon.

Take care.

Frank Holmes: Take Care.

Frank Curzio: Okay guys, great stuff from Frank.

Love having him run the program.

Just the energy that guy has man is just incredible, man.

He’s just, he’s an inspiration, at least for me.

I love it.

’cause he’s just like a research junkie.

Loves what he does.

You could tell.

But, um, get back to Consumer Electronics Show again, guys, I’m there right now.

So as you listen to this, it’s cool.

You have any questions, comments, follow me on Twitter.

I’m gonna be having lots of videos, lots of ideas.

I’m gonna share the best ideas with you, obviously.

Especially lots of really, really good ideas in, in, in our Wall Street Unplugged Premium podcast with Daniel.

So be sure to listen to tomorrow.

Okay.

If you wanna subscribe to that, it’s very easy.

Just go to our website, you can subscribe, WSUPremium.com.

It’s pretty easy.

It’s very, very cheap.

but lots of stuff to go over.

I love going to this event and the AI tour’s gonna be amazing, but that’s just Wednesday, all day.

Wednesday, Thursday and Friday I’m probably meet with another a hundred companies, being broadcasting everything and, and testing out all the new technologies and services and have lots of meetings set up.

If you’re gonna be there as well, feel free to drop me a line.

I try to meet subscribers.

Sometimes I get a lot like 20, 30 and it’s really like business.

It’s fun, but it’s business.

It’s like every sec is accounted for, learning so much new stuff.

My mind’s like all over the place, but I try to meet my subscribers whenever I can.

So if you go to be the electronic show, drop me a line, Frank@Curzioresearch.com.

I look forward to seeing you tomorrow on Thursday.

And again, I’m gonna try do everything I can to call in live to Daniel, Daniel Creech and Thursday’s podcast.

And if not, I’m definitely gonna send a lot of information, a lot of notes of what I’m seeing, some ideas.

So that’s it for me.

Questions and comments.

I’m what we here for you, frank@Curzioresearch.com.

And I’ll see you guys more.

Take care.

Announcer: Wall Street Unplugged is produced by Curzio Research, one of the most respected financial media companies in the industry.

The information presented on Wall Street Unplugged is the opinion of its host and guests.

You should not base your investment decisions solely on this broadcast.

Remember, it’s your money, and your responsibility.

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