Resource financier (and fan-favorite guest) Marin Katusa is back to help break down a wide range of topics—from what he calls “crossflation”… to his latest book, The Rise of America: Remaking the World Order… to why he sees a bright future for the country.
Marin explains why the price of gold doesn’t need to go higher for gold miners to generate tons of cash at current prices… and how he’s positioning himself for more gains in the uranium sector.
Plus, as green energy gains traction in financial media headlines, Marin shares the biggest opportunity he sees in the space over the next few years… and why he expects it to outperform stocks, gold, and even bitcoin. [38:22]
Then, Daniel and I discuss the travel ban to Japan before the Olympics… We break down the cause of the excessive volatility in cryptos right now… And, turning to inflation, we debate the difference between real-world prices vs. stock market performance. [01:15:08]
Today’s episode of Wall Street Unplugged is sponsored by Blockchain.com. With over 70 million wallets, it’s one of the most trusted cryptocurrency platforms in the world.
Not only can you trade your favorite cryptos… you can earn up to 13% interest annually on assets like bitcoin, ethereum, and USD Tether.
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- Intro: Social media and “meme stocks” [00:30]
- Guest: Marin Katusa, resource financier and author [38:22]
- Analysis: Japan travel ban and the 2021 Olympics [1:15:50]
- Educational: What’s causing the current crypto volatility? [1:26:40]
- Educational: Inflation debate [1:40:12]
Wall Street Unplugged | 775
Marin Katusa: The future of the country is bright
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 May 26. I’m Frank Curzio, it’s the Wall Street Unplugged Podcast, where I break down headlines and tell you what’s really moving these markets.
Frank Curzio: Social media is like the devil’s gift to the world, seriously. I mean, it gives everyone the opportunity to say whatever they want, unless you’re Donald Trump, or don’t believe in the BS COVID narrative being pitched by our government since last March, can’t say anything about that. They’re now saying that COVID may have been created in a lab in Wuhan. They’re saying that now. Fauci said that. I don’t know if you remember, people got banned from social media for suggesting that. I’m talking about leading scientists, those scientists that worked on that project, that came out, a whistleblower. They suppressed all of this. You weren’t allowed to say that. Which is insane, right? Because if we look from common sense, you’re supposed to say common sense, forget about what side you’re on or whatever, there’s always arguments.
Frank Curzio: But this thing started spreading like crazy in Wuhan in December and then in January. Even earlier than that, but that’s when we… In December, we finally realized it. And the best infections doctors, scientists, all over the world said, “Hey China, listen, we’ll go to Wuhan. We want to learn about this new virus, how to contain it, how to save lives, let us help you, because we’ve never seen anything like this before.” And it was really cool. I mean, it wasn’t just CDC or WHO, it was countries all over the world.
Frank Curzio: And what did China say? They said, “We don’t need your help. We don’t want you to come here.” They didn’t allow the CDC in. They didn’t allow the World Health Organization in. They said, “No, we don’t want you to come. We don’t need any help at all.” And this was in January. “We don’t need any help.” So, once again, CDC and the World Health Organization came out and said, “How great China contained the situation, how great,” even though they had no clue. They weren’t allowed. They weren’t allowed in China. They weren’t allowed there. So, if something was spreading here killing people, we couldn’t figure out why. Why not invite the world’s leading scientists to come here and figure it out. Makes sense?
Frank Curzio: Why did that happen? Apparently, you didn’t want the help because the mission was obviously to infect the world. That had to be the mission since you knew how contagious this disease was right off the bat. You closed Wuhan to the rest of China, you didn’t let anyone in to know about it, but you did allow residents from Wuhan, they couldn’t travel to the rest of China, but they could travel around the world. And that’s how this thing spread everywhere, which led to three and a half million people dying, including 600,000 Americans.
Frank Curzio: I remember posting a lot about this and on COVID much earlier than anyone else, because I was, I don’t want to say I’m fortunate, but I was interviewing people on lockdown through this podcast, Wall Street Unplugged, in Italy, in China as well, even quarantine in China. A couple of friends that I interviewed, they told me how it was, how crazy it was. They knew it was coming here. I mean, just having access to the right sources of information really helped us. Not just from the market’s perspective, but telling people, “Hey, this is serious. You got to watch out. This is coming to the U.S.”
Frank Curzio: I know it sounded crazy in January, and even in February, until they started closing everything. Talking about this before Johns Hopkins started collecting statistics through their website. Now it’s the standard, everyone get their COVID statistics from. But I remember getting ripped for talking about this. And some people’s accounts, they actually got banned. And this is including doctors, scientists, who offered their opinion on solutions and even remedies that could work to treat COVID, that they saw a patient. No, no, no, no, no, no. Can’t say that. No, you’re not allowed. We don’t want to hear from you.
Frank Curzio: I’ve said this numerous times. I can’t tell you how many doctors listen to this podcast, doctors and stock. They love stocks. They love investing, and they are aggressive investors, most of them. But I can’t tell you how many doctors have sent me amazing information of what they’re seeing in the field, at their hospitals. Some of them run leading hospitals around the country and all of them were like, “Just don’t use my name.” Are you kidding me? I get why they’re saying that. But imagine that you are trying to help people and save lives, and nobody wants to hear from you.
Frank Curzio: Or, you’re looking at what’s going on here. I mean, for me, getting ripped for telling people there’s no science behind six foot distancing early on, or mask, how they slow the spread of the virus, which is now being updated to be true. I mean, this is 16 months after COVID began spreading across America. 16 months after we closed all schools. I remember saying this doesn’t impact children; look at the statistics, all this didn’t matter. I was getting ripped, ripped by a lot of people. And I get it. It depends what source you’re listening to that’s scaring the hell out of you.
Frank Curzio: But it’s amazing how these social media platforms are supposed to be a way for everyone to… It gives a voice to everyone, to express what they’re thinking, what they’re feeling, but they’re not free platforms. This isn’t freedom of speech. If you believe in a narrative, if you don’t push the limits or anything, but it’s really not, they control it, these are companies.
Frank Curzio: I mean, look at Facebook, who makes money by tracking everything you do without having to tell you. Your entire life, your kids’ lives, everything, where you’re going on vacation, everything. And it sells all this data to third parties and makes a fortune from you. Well, you think, “Wow, Facebook is cool.” They’re watching everything you do. We’re all creatures of habit. We all go to vacation at the same time. We drink our coffee at the same time. We go to bed at the same time. We wake up at the same time. Once you figure out exactly what we’re doing, where we’re going, when we shop, it’s not too difficult.
Frank Curzio: You can blame the people for that and say, “Hey, I’m checking in, in Walmart right now, or Starbucks, right this second, here I am right now.” And taking selfies. And where you are and posting it and liking, hitting everything you like, all that goes into a massive database. And they throw AI on top of that to predict what you’re going to do next. And that’s incredibly, incredibly, valuable to any business in the world. Imagine knowing exactly when your customer… For me, exactly knowing where a customer is looking to buy a financial newsletter that focuses on the crypto industry, and they’re looking to buy it next week. You know how valuable that information is to me?
Frank Curzio: And you spend a million dollars because I probably generate three, four, five million dollars just off of that. I don’t have to waste my time with getting a whole demographic that I’m not really too sure about. It’s such a big deal and why these are the biggest companies in the world. When it comes to Twitter, which I’m on and I post a few times a day, I mean, it’s a pure hate platform now. It’s all hate. These outlets are controlling every aspect of our life. Every one. This is what we look at when we’re on our phones. It’s some social media platform.
Frank Curzio: So, I’ll tell you, download TikTok. TikTok is the only platform I know that makes me laugh, that makes me feel good, it focuses on all the topics I’m looking at. It’s not people getting angry in your face and pissed off. At least I’m laughing, and it’s fun, and it’s cool, and you’re seeing things that you usually don’t see, and you could scroll through it right away. It’s unbelievable. But a lot of these platforms, I mean, just the hate. And how they’re controlling every aspect of our lives and every industry, including ours.
Frank Curzio: I mean, you don’t think so? Look at GameStop. GameStop is at $230 again. Why? Because they’re getting into NFTs? Is it that easy? If it’s that easy, I think I may announce that, maybe our stock will go into 10, 20, $30 billion valuation, even though they’re completely late to the party, and they know very little about this field. But the stocks surging about 14%, 15% today because of that. And what’s next? They’re going to buy Bitcoin. Then they’re going to get into AI. They’re going to use all the buzzwords, right?
Frank Curzio: And then they’re going to say, “You know what? We’re going to launch a spaceship. It doesn’t matter when, you can do it 50 years from now, we’re going to launch a spaceship, AI capabilities, going to be able to post social media.” It’s funny because all these companies put in the buzzwords, right? They put in the buzzwords, they get excited, it doesn’t matter about revenues or earnings, right? Look at where GameStop is. Look at where AMC is.
Frank Curzio: Are people really going to the movies right now? No, but these names are surging because there’s this massive campaigns through social media, Reddit, to push these names higher. And take Bitcoin, a sector talking about for four years now. It’s an industry that we’re in. And we have our Crypto Intelligence newsletter, let’s subscribe it to that, and encourage you equity own a security token, the first ever to launch a security token. It’s available at a foreign exchange for retail investors. If you launch a security token today in the U.S., it’s almost impossible to get it trading. tZERO has a few. Other than that, you can’t for retail investors.
Frank Curzio: Do I love this industry? I believe in it. I don’t believe in people pumping Bitcoin, no matter what the price is, saying, “You’re an idiot if you’re not buying it. Just keep buying it. Hold on for dear life.” I mean, all this stuff, believe it or not, used to be illegal. I mean, the SEC would fine, ban you from pumping anything, and they usually fine you after you sell it. It’s got to be damages there. If there’s damages, then if you hold something forever, they got nothing to sue you for, because they can go back down. But once you… You don’t know what’s going on. Who’s selling, who’s buying, and after what they’re saying on social media, but so many pumpers. But I mean, the SEC would find it and ban all these pumps immediately.
Frank Curzio: And you say, “Okay, yes, you do add this up,” but Bitcoin, whose claim, “We’re never going to sell, we’re holding on for dear life.” Newsflash, someone was freaking selling Bitcoin since it crashed, over 40%, over one trillion was wiped off the total market cap of crypto. In what? Two weeks? Somebody was selling it. I could tell you how many people were pumping it over 50,000. But hey, if you’re allowed to pump and dump, but everyone is doing it, then of course, everyone’s going to follow. Why not? That’s what we do.
Frank Curzio: If someone’s doing something and benefiting from it, you’re going to be like, “You know what? I want to do the same thing. Why not? They’re doing it.” It’s like our school system. We have really great teachers, but… And a lot of teachers would admit this: We have a lot of shitty teachers too, who barely do the minimum. I see that with my daughter. They don’t even put the grades in. She gets grades, and she got 200 on a test that weren’t even put in the system for like three to four weeks. It was showing a C, and then finally put it in, it showed an A. What do you do? Isn’t it your job to put this stuff in the system?
Frank Curzio: But they’re just like, whatever, you ask them questions, they give you one word answers. They don’t want you to ask any questions. There’s a lot of crappy teachers out there, but you know what? Most get paid the same. I can see some teachers say, “I’m working my ass off here, and the person next to me doesn’t give a shit. So, why should I give up more of my free time?” And again, they’ll say, “Well, it’s about the kids,” and I get it, those are good teachers. But you could see that, right? You could see that happening.
Frank Curzio: I mean, the system almost promotes you to do less work and also encourages to promote the narrative. Because if you have tenure as a teacher, you can’t get fired, right? You can’t get fired for almost anything. Almost anything. Allows you to teach classes about whatever you want, white privilege, white… Capitalism is racism, or whatever. Why do you think these teachers are doing that now? They don’t get fired for this. They’ll leave a school or something and go someplace else or whatever, or step down, but they have tenure. They can talk about whatever they want. Forget about the parents. Parents don’t know all this stuff. They’ve been conditioned the last 10 years among this garbage, that’s really coming to a head. You do whatever you want. Why not? That’s the system we’re in.
Frank Curzio: Now, when it comes to social media, I get it. I get why so many individual investors are going to pump their favorite stocks. Everybody’s doing it pumping. They’re pumping, this is great, buy this, buy that, I see it all over Twitter all the time. That’s why I try to follow a lot of people. And then, I had my nephew come in, Joe Davide came in, and it was great and interviewed twice. And the first time, he said he’s doing really well. Then he got crushed on ESG stocks. He’s 21 years old.
Frank Curzio: And I was asking him, you’re down a lot of these stocks. He’s like, “I’m going to hold them.” He’s like, “I’m holding them. I don’t want to lose. I’m holding them.” I’m like, “Well, that’s the opportunity, cost of buying, whatever.” But it was a great interview. Got lots of great comments on it, firstname.lastname@example.org. But when I asked him and said, “Well, where did you get these stocks from?” “Oh, I follow this guy on YouTube.” “Did he tell you to sell it, or tell you what to do?” “No.”
Frank Curzio: He’s telling you when to buy it, but he disappears when you need him most. For me, that would never ever happen with my services. I mean, that’s when you need me the most, that’s what you pay me for. When things are going on, I’m not going to send you as many alerts, compared to if I’m wrong on something, tell me exactly what to do, because I’ve got to be wrong on certain things. Everybody’s wrong in this industry sometimes. I’ve got to be right more time than I’m wrong, or no one will listen to this podcast, and no one will subscribe to my services.
Frank Curzio: I’ve been doing a very good job in the portfolios for a very long time throughout my career. I love what I do. But I understand my investors, I understand that they want to know, and most investors, I’m telling you, the emails I get from almost everyone who’s a subscriber, a lot of people listen to this, it’s always about asking me when a stock is down. It’s not like, “Frank!” It’s like, “Frank, what should we do? Should we be selling here? Should we buy more?” They just want to be told what to do, that’s what they pay for. You don’t have that through the social media and all these platforms.
Frank Curzio: I mean, I had a guy, a big influencer, who we are going to have on, and we are planning it. Has a ton and ton of followers. I was going to interview him and he came back and he said, “I don’t know if I’m going to have time to do this. Plus, I don’t like negativity, so you can’t say anything negative.” And I’m thinking, “What the hell is this guy talking about?” I’m like, what does he mean saying… I mean, had he done like 1% of research, whenever I interview a guest, I know every single thing about them and everything they said over the past six months. All the interviews they did, everything. That’s my job.
Frank Curzio: To vet them, to research, to make sure I’m asking them those questions. And I know the questions I’m asking are probably the questions my audience wants to know the answers to as well. This way, I’m educating myself, educating you. That’s in preparation. A lot of preparation goes into this podcast, a lot, and I love it. I love learning about these people, different investment styles, if you have a different opinion than me, it’s fine, it’s cool. Be able to back it up.
Frank Curzio: They probably got some amazing guests, one coming up pretty soon. But for this person to not even do one bit of research on anything, and I’ve been doing podcasts for 14 years, and see how my interviews are, seeing the quality of people that I interview, and him worry about saying… Why you worry about… What do you have to hide that you’re saying, you worry about me asking negative questions or talking negative? This is the YouTube generation. There it is. Going to tell you exactly how to buy stocks, how to make a fortune, but when you get crushed, hey, where are you now?
Frank Curzio: But I could see, like those individual investors watching these platforms and they get to pump their favorite stocks on other social media platforms. And they don’t have to let anyone know when they’re selling them. They could pump them, go higher, get a whole bunch of… I mean, you say, “Well, it’s one or two people.” Reddit has what? Last time I looked, I think it was seven to eight million. But they might have 10, 12 million, WallStreetBets.
Frank Curzio: I mean, that’s a huge influential crowd that was able to push a stock higher and almost bankrupt. What was it? A $10 billion hedge fund? Melvin Capital? Where it needed billions in infusion, in cash infusion? You’re talking about a lot of people, a lot of influence there, knowing that this person is sure, and we keep pushing high, he’s got no choice, but to get out of this thing for selling to go higher and higher and higher. But the way the system is set up, it promotes this. It promotes like even the people that aren’t doing it, where they’re watching, and saying, “Hey, I’m going to do the same thing.”
Frank Curzio: I mean, it’s like people who are unemployed right now. Why would you go back to work when you’re making more money staying home? I mean, that makes sense, right? You can be pissed off with them, but why would you do that? Most people hate their job. I happen to love my job, but a lot of people hate their job. If you’re going to get paid more money to stay home and do whatever you want, have fun, play video games, go out, exercise, whatever, why wouldn’t you do that? Right? So, it promotes the next person, and the next person, and the next person to do it. That makes sense to me.
Frank Curzio: What doesn’t make sense, and what I never expected to see, never expected, maybe I should have, is how professionals are doing the same thing. Talking about billionaires, like Elon Musk, Mark Cuban, promoting Dogecoin, while telling everyone, “This is a scam.” Think about that for a minute. Think about it. If you could remember, and I know of these young kids, let’s say, if there was no social media, and you actually did that and said, “Hey, you were on CNBC 20 years ago and you said, ‘Hey, you know what? I like this stock, I think you should buy it, even though it’s a fraud.'” You wouldn’t be locked up, but you’d probably lose your license. Today, you could say that.
Frank Curzio: Elon Musk being able to flip flop, right? I mean, you should have your own opinion, fine, but on Bitcoin, he’s like, “I’m buying it for Tesla. Use the balance sheet to buy over a billion dollars in Bitcoin. This is great, Bitcoin.” What happened to Bitcoin when he announced that? Prices surged. And then he comes out a few weeks later saying Bitcoin uses too much energy, it’s not green. I mean, stuff like this is influencing the markets to where Bitcoin was moving five to 10% a day over the past few weeks, even 15% in some days. But holy cow! I mean, think about that. It’s crazy. I mean, the hedge fund managers, bashing Tesla. These are hedge fund managers saying, “The companies are fraud. Elon Musk is a liar.”
Frank Curzio: They’re promoting how every car that crashes in a Tesla is reported. Like it’s an airplane crash. It’s self-driving technology that… Do you know how many cars have self-driving technology right now that crashed? I mean, all the cars being rolled out, a lot of high end, top of line cars, Cadillac, Escalades, they have similar technology. If they crash, you’re not going to hear about it. But you hear about when Tesla does because they’re sure. And again, this stuff influences the markets. And as they’re saying stuff on social media, you have no idea. These people are buying, selling, still in the name.
Frank Curzio: And look what Tesla did it first. Elon Musk said, “We’re buying Bitcoin,” and Bitcoin went through the roof. And then all of a sudden when they reported quarterly estimates, he said, “Oh, we sold some of it. We wanted to see if we could sell it.” I think that’s what he said. “We wanted to see if we could sell.” I don’t know what that means. You bought it, you’re sure you could sell it, but we all know you sold it, so you were able to book those gains and make the quarterly numbers because of that. So basically, you pumped up Bitcoin, it went up tremendously, and then you sold it in profit for your company. Isn’t that pump and dump?
Frank Curzio: But we really have no idea if these people are buying, selling, still in it, whatever. But all of this is illegal. It’s illegal in our industry. It’s illegal. But on social media, hey, it’s perfectly fine. You can do that. Nobody cares. Then we look at these platforms and all the hate on it. I mean, never seen so much… Like if you meet people on the streets, most people are nice. Most people want to do everything they can to make a better life for their family. I don’t care what color, what race, we all have those goals in common, right? Make a better life for our kids, all of us. I mean, you see people. People hold the door open for us, they say, “Thank you.” On social media, forget it. Holy cow.
Frank Curzio: I mean, if you want to be entertained, follow Elon Musk, follow Bitcoin, follow Gold, all three of those. Holy cow. The tweets that you get through those in a post, they’re insane. And this is from someone, it’s all risky. It’s all risky, right? That’s it. It’s all risky. Those hedges, this is a real tweet, because Elon Musk appears to be treating Dogecoin like one of his own companies. He’s actually marketing Doge, engaging with the community, and using his engineering and leadership prowess to contribute to Doge development, with Elon as Doge CEO, we are in good hands. Do you know how terrible that statement is?
Frank Curzio: Elon Musk pumping something that he said is a fraud, and you’re saying he’s the Doge CEO, and he’s trying to contribute, which he said, but who knows they’re doing it to develop. I don’t know what they’re developing though. I sure have no idea. We’re in good hands. Which by the way, you’re not allowed to promote your stock as a company if you’re a publicly traded company. So, the CEO of Coca-Cola can’t say, “Hey, you know what? Everyone should be buying our stock right now.” No, no way. They need analysts to say that. That’s where all the money is made, that’s why it’s all biased.
Frank Curzio: I mean, especially small research investment firms, they’re not going to cover a small firm. At first, they go, “Hey, you guys going to need to raise money? Great. We want to be on that capital raise. This way, we can charge you fees and you know what? We’ll come out with a report and we’re going to put a buy rating on you.” Okay, deal. Everybody’s happy. That’s the way the system works. I mean, if these guys call and you say, “Hey, you know what? I’m not going to raise.” There’s a reason why companies that don’t need to raise money and have no debt in their balance sheet and just have a lot of cash, they don’t get a lot of coverage, because nobody’s generating investment fees off of them. That’s the system. They need these outlets. They need other people to tell you how great their stock is. But the CEO can’t say, the company can’t, “Hey, now’s a great time to buy our stock.” Social media, you’re allowed to do that.
Frank Curzio: Another Tweet, #Copico, says, “Maybe, just maybe, Bitcoin is worthless, useless garbage. A fake asset, worse than tulips, as tulips you could eat, or at least plant in your garden, and don’t suck up electricity for no reason.” You don’t eat tulips. But just worthless? Is it worthless? I mean, you have guys like Peter Schiff, who destroyed Bitcoin, the Bitcoin crowd over the past three weeks. I mean, just look at his Twitter page, he’s got a massive following, he’s a great entertainer, good for him.
Frank Curzio: But as his Bitcoin holders, beware, in case it escaped your notice, the long overdue rotation from growth to value has begun. This includes a rotation out of Bitcoin and into gold. Bitcoin has been the epitome of growth over value, as it’s all growth and no value. Sell while you can. In a tweet from last month from Schiff, so far in 2021, Bitcoin has lost 97% of its value versus Dogecoin. I don’t know what time period, but I don’t know. So, the market has spoken, Dogecoin is eating Bitcoin. All Bitcoin pumpers who claimed Bitcoin is better than gold because it’s price has risen more than gold, Musk now can see that Dogecoin is better than Bitcoin.
Frank Curzio: I mean, do you know how false that statement is? But you’re allowed to post this on Twitter. And for the record, here’s Peter Schiff coming out, trashing these people saying, “I told you so.” If you look at his track record and you look back to 2018, when this market first started falling, he said, “It’s going to zero. Bitcoin is going to zero, get out of it, it’s fake.” That’s what he said. And even after this crash, for gold bugs to come out and rag on those Bitcoiners, and some of them deserve it because they will really pumping it at 40, 50, 60, I get it. But really? Like, this is the moment that you’re saying, “I told you so?”
Frank Curzio: Yes, we had a 40% correction in this, but if you look at the numbers, Bitcoin is up 300% in the past 12 months while gold is up only 50% in the past five years. Is this the argument the gold bugs want to have? And I’m not promoting Twitter, I’m not reporting gold, I’m just telling you how these platforms are used for so much hate and so much bullshit, and yet, nobody cares, it’s perfectly fine. I follow Quoth the Raven on Twitter. He says, “Oh, look, we can pull these stupid Bitcoin to gold ratio charts out when Bitcoin is crashing too. Here’s Bitcoin versus gold over the past month.” And he shows how gold up over the past month. Over the past month, really? You could take any timeframe before May and you’re wrong, but you’re really going to say over the last month?
Frank Curzio: Another person, Special Situations on Twitter, it’s a hashtag, Special Situations, says, “Bitcoin got demolished in the last month because a sufficient amount of HODLers, hold for dear lifers, who bought or acquired it well below the current cost of production, mostly Chinese miners, decided to take profit and bail. Bitcoin should not under any circumstance be trading about $25,000 per unit.” No research on that, just, “Hey, should be trading lower.”
Frank Curzio: That’s the case and Bitcoin goes down, maybe it’d be hard to short Bitcoin itself, but there’s a lot of pure plays miners that are stocks now, they could easily… They got crushed along with the downturn in Bitcoin, but I just don’t get these people, mostly gold bugs, they’re bashing. Bashing like crazy. And the funny thing is here, Bitcoiners are also bashing gold bugs, but these people are so similar, it’s a joke. I mean, they’re buying both of these asset classes for the same exact reason, because they don’t trust fiat or money that’s printed by governments. It’s the same thing. Think about it.
Frank Curzio: You look at that basis and people are going to say, “All right, you know what? I’m buying…” They both have an argument. You’re buying as a hedge against inflation, a store of value, an alternative currency. Those are the three main reasons you see people buy both of those asset classes, and all those reasons come into the same exact umbrella of not trusting fiat, but yet, they bash each other and they hate each other. Why?
Frank Curzio: I mean, you could own both. And again, look at the Bitcoiners, I could see the gold bugs getting pissed off because Bitcoiners can be in your face sometimes, posting 10 times a day on these social media sites telling you you’re a loser for not owning Bitcoin, I get that part. Although, if you’re looking at the big names in the industry, guys I interviewed right here, Wall Street Unplugged, Dan Held, Bobby Lee, I mean, these guys are on Bitcoin forever. These are big shots.
Frank Curzio: These are legends in the industry, and when I interviewed, they were down to earth and cool. Bobby Lee said he even owns gold. And Dan was like, “Look, I’m holding Bitcoin forever,” but he wasn’t bashing people or bashing things. These guys were just, “Hey, this…” It wasn’t on social media, it was a real interview with two legends of the industry. I’ve interviewed a lot of great names in this space, huge. But they weren’t like pumping or saying, “You’re not buying it, are you crazy?” No, no. You see that a lot on social media though. Because when it comes to that, it’s going to be the death of us. It’s a place where the people running these systems are encouraging hate and conflict. They suppress certain information. Why do they do that? Because that’s what gets people emotional enough to post.
Frank Curzio: So, the reason why when you watch the news, whatever news source, I don’t care what sides you’re on, there’s never any happy stories. It’s all bashing the other side. Could you believe they said this, look at this, they’re taking away our freedoms, look at this. Trump is trying to kill America, Trump’s a domestic terrorist. Really? I made a lot of money in the Trump years. I know anyone who had a job made a lot of money in the Trump years because we had lower taxes, lower corporate taxes, had more jobs. I’m not promoting the guy because there’s a lot of shit you don’t like about him, but come on.
Frank Curzio: And even Biden administration, it’s just bashing every, every, every negative. Why? Because that’s what sells to people who want to watch. And the guy in CNN, where they taped, they took that off social media immediately, right? Where they secretly taped the guy saying, “Hey, we’re promoting, we want to make sure we put the death count right on the screen, this way you know, and we’re scaring you. This is what we wanted.”
Frank Curzio: Like he’s saying that. He’s in charge of major component of CNN and content. Are you kidding me? That he’s actually say… We all know but he’s actually saying it on tape, but social media suppressed it. No, no, no, no, no. We don’t want that out. Absolutely not. But when you’re looking at a place that encourages, and these are the people that are running the system, they encourage hate and conflict, and again, you’re going to get millions, tens of millions, hundreds of million people to post all the time. And therefore that’s great for them.
Frank Curzio: They’re never going to go out of business. It’s advertisers are going to pay a fortune, knows every spending pattern, know exactly what the customer is doing and is going to do in the future, right? You would pay a fortune to that. How, in a future AI… You’ve been on these platforms. When everyone says, if a new company comes out and says, hey, we have AI capabilities, short it. Artificial intelligence is used to monitor data, to look at data over a long period of time. Have you been on Facebook? Three, four, five, six, seven, eight years or Google, they analyze all of these patterns, and they come in, and they’re able to predict what you’re going to do next. Why do you think people are paying a fortune? Why do you think that, these are trillion dollar companies, trillion, trillion, dollar companies. You’re huge, why? Incredibly valuable asset, what they have. It’s not going to change.
Frank Curzio: So, as an investor, just be careful where you get your information from. Lot of these people on social media, they’re out for themselves. They’re pumping whatever. They have several accounts of their different names, trashing whatever they want to trash. If they’re shorting stocks, they’re going to trash it. Seeing that a lot through social media. Now, we have Citron and saying, hey, we’re no longer going short because they used to post. And then they used to go on CNBC and post on social media as well and say, hey, tomorrow, we’re coming out with a stock. That’s worthless. And we’re going to uncover the fraud tomorrow. Today, I just loaded up on the fricking thing, short the shit out of it right? Tomorrow, when I go on TV and let you know what it is, and this thing goes down 25% a day, I don’t have to tell you if I’m going to buy back that position. I don’t have to tell you that. That’s illegal.
Frank Curzio: It’s going to continue. And that’s a big surprise to me is how even the experts, most influential people who are billionaires, great success stories, at least in my field, joining the pump-and-dumpers. Are you kidding me? It’s definitely not a good thing. And look what it’s result. What has resulted in it? You have Elon Musk tweeting about Bitcoin, an influential person. And what is he doing? He’s moving or capable of moving a hundred billion dollars in and out of an asset in minutes. Hundreds of billions of dollars changed hands because of a simple tweet. Where’s the SEC? It’s too late now, it’s spread so wide. What do you do? You don’t want to have capabilities and not enough people there, which is crazy. I think I’m going to be interviewing someone very, very high up in the SEC in the coming weeks. Just arranging it. Someone that believes in crypto.
Frank Curzio: And these are some of the questions I’m going to ask. In a GameStop crowd, the AMCs, yeah, you’re making money, and every, but is it on fundamentals? No. It’s about a bunch of people just posting as many times as they can and trying to get more and more and more people in these stocks, which again is illegal. Right now, the SEC is lost, they can’t do anything about it. Anyway, for the record, I like Bitcoin. Like a lot of other coins. You’re going to find our Crypto Intelligence newsletter. I like Tesla about two, three weeks ago. I said, look. And the reason why is I looked for a car at the major dealerships because my lease was up. I couldn’t find anything. No, there’s nothing on lots. And everyone’s like, it’s going to take six months. If you build your own car online with your own specs or whatever, six months, minimum consider chip shortage.
Frank Curzio: But Tesla, Tesla’s the only company in the auto industry that, when I went on their website and I’m not buying a Tesla, they said, they’ll deliver it inside of two months. I know someone who’s waiting two and a half months and it’s getting delivered in the next couple of days. So, maybe a little longer, but still much better than six months. People want a car. They need a car. Hey, you know what? I’m going to try Tesla. At least I can buy one and have it within two months. I have to wait six months, maybe. We think it’s going to be four to six. We think, we’re not sure, maybe. What you going to wait, nine months for the, you might as well get the next year. The 2022 is going to be out. Are you kidding me? By the time they start shipping these things. And Tesla skyrocketed, right? Up a 100 points, did well.
Frank Curzio: I never told you to buy Tesla, sell Tesla, or whatever. Okay, it’s something I would never, ever short, but just always good buying opportunity. The markets helped, came back, but Tesla’s doing pretty good. And for the record, I really, really, really love gold right now. I don’t care what it did in the past. I don’t care if Bitcoiners hate it. I don’t care. It’s not what I look at. I look at the future. I don’t care that gold’s up 50 percent, five. I don’t care.
Frank Curzio: What I do know is we have more inflation than we ever seen in this country since the eighties. And Volcker came in and said, okay, we’re done with this inflation and forced a recession, raise rates drastically. Again, rates were a lot higher than they, are today, but we’re looking at inflation numbers that are very, very high going higher, much higher than the Fed’s mandate, right? Which was 2%, we’re at over 4% now on a CPI, which is the gauge created to show almost no inflation ever. But the Fed looks at, and even that is showing wild inflation, the Feds. It’s going to be temporary. They don’t tell you life’s going to be temporary, but it’s going to be temporary. So, don’t worry about it. So, now we have massive inflation and a Fed that is saying, you know what? Pedal to the metal. Not even thinking of backing off, tapering, lowering rates, nothing. Still buying bonds, nothing. Still injecting money into the system.
Frank Curzio: Crazy. And gold is going to go higher and higher and higher. I wouldn’t be surprised $2,500 by year end, which would make a lot of companies an absolute fortune, since a lot of them are being valued at like 1600, $1,500 gold right now. And we’re at 1900. The goal as a sector guys, probably my biggest holding, sector-wise, not probably, it is my biggest holding sector-wise. We just added a lot of positions. I continue to add to them. It’s being selective. You see a lot of those names around my portfolios, really, really, really like gold here, along with Tesla, along with Bitcoin, but probably more bullish on gold than anything. When it comes to gold, uranium, copper, commodities, nobody owns more than this guest. This interview is an awesome one, which by the way, is being sponsored by Blockchain.com, the most trusted cryptocurrency platforms in the world, with over 70 million wallets and over 800 billion in transactions since 2011.
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Frank Curzio: Today’s interview is with the one and only Marin Katusa. He’s one of your favorite guests. Also, one of the most controversial, although he’s kind of tamed during this interview, which I bust his balls about a little bit, but he talks about what he’s doing in the gold space, which is surprising to me. It was surprising, but he’s just focusing really on one area. And it’s an area that he doesn’t really focus on that much, usually focused on another area. They don’t want to give it away, but it was a surprise.
Frank Curzio: There was talks about where he thinks uranium is going. People love your uranium in these days. And, I report about uranium, do videos on uranium. We get tons and tons and tons of views. I can’t believe how many people love uranium because for the last 10 years, you could do anything on uranium. People didn’t care. Now, everybody likes uranium. Let’s hear from the smartest people in that industry.
Frank Curzio: And he’s also going to talk about his next big investment into a space that I love that’s nearly impossible for any investor to buy into. Marin says, he’s putting more money into this deal, more money than he’s ever put into any single deal in his career. That’s why for me, I pay attention. I saw the name of this. I know what he’s doing. It’s unbelievable, it’s fantastic. And he’s going to talk about it during his interview. Also, Marin just launched a new book called “The Promise of America,” came out yesterday. I know, I asked him the question. Why is it Canadian writing about America? You know, again, I like the bust his chops, we’re very, very good friends, but he’s just released it yesterday. It’s his first interview where he talks about his book, “The Promise of America.” So, you know what? Let’s get to that fantastic interview right now.
Frank Curzio: Marin Katusa, thanks so much for coming on again on Wall Street Unplugged. What’s up, man?
Marin Katusa: It’s my pleasure, buddy. Not too much.
Frank Curzio: Well, you got a lot going on, including a new book, which we’re going to get to in a little while, but I wanted to have you on because you know all the gold bugs right? You’ve been doing this all your life. I know them as well. I was never really an inflation guy. I never really saw the inflation, that argument’s been around for such a long time yet, if you’re looking at the numbers over the past month, month and a half, they’ve gotten really scary. The CPI is through the roof and CPI is the gauge that America created to not ever show inflation, right? So, that’s the one that the Fed looks at and that’s even showing inflation. Everybody’s raising prices across the board here. It’s nuts. What are your thoughts on how this impacts gold? Is gold finally here? Is that the best way to play this, but I want to get your thoughts on it.
Marin Katusa: As I’ve been writing, we’re going to be in an area of what I call cross-flation. And, you’re seeing some massive inflationary pressures and simple things like copper, lumber, certain commodities are just exploding right now. And from our perspective when you would come with me, some of these sites, and I’d be talking about why copper is so critical and two, three years ago, no one cared. Now, when these stocks go up, one stock that we wrote up in August was a buck, 50, it hit $13 the other day, you have to take money off the table. So, I’m getting a little uncomfortable with these inflationary pressures because there’s no shortage of copper at $5 copper. That’s just the fact you’re looking at lumber. I think lumber’s got a lot of pent up demand and manufacturing was kind of pulled back.
Marin Katusa: And the saw mills, you know, you look at what happened in that whole echo period. Many of the saw mills in B.C. just shut down, the Pacific Northwest, they weren’t ready for this massive demand. One thing about our markets is it’ll always find a way eventually to meet demand. So, that’s been proven historically, it’ll prove forward. So, talking about gold, there’s this narrative that we need higher gold prices. And, although I would argue with that, my point is you can find incredible free cash flows. We’re at 1885 goals. This is stuff that we dreamed about five years ago, Frank, these are incredible value. And yet some of these very big companies are trading at 0.5 times NAV, using $1,400 gold. At $1,500 gold, they’re trading less than half NAV. So, why would I take these risks in a market where chasing this new commodity that new companies that are nowhere near getting their permits and risky areas… That I’m avoiding, what I’m looking at is true value. And the gold market right now is very compelling.
Frank Curzio: You bring up a great point when it comes to the large caps, right? In this industry with a dirt cheap and a growing tremendously, cash flow’s never been more positive, the amount of money that these guys are generating. Also, they produce a lot of copper, right? Which I feel like is not even on the books for them or not even being modeled right now by the analysts, the sell-side analysts. Now, do you think that with the amount of money that they’re making and you’re experiencing junior miners, because we do have a shortage of gold, don’t we? I mean, it seems like there wasn’t a lot of drilling for a very long time, but there are some junior miner products projects that are really great that, you know specifically, and you know there’s not a lot of them, are even venturing into that? Or you’re like, you know what? It’s not even worth it, like you said. And, let me just stick to the large guys because we could generate a lot of money and the risk on a risk adjusted basis, it’s really the thing to do, right?
Marin Katusa: Look, some of the companies that I have financed have had incredible runs here. And at that point, you take money off the table. It’s not that I don’t believe in management. It’s not that I don’t believe in the project, but if something goes from a hundred million dollar market cap to a billion and those catalysts of, hey, they’ve made a big discovery here. Then the reality portion comes in, permits, feasibility study. We got to go raise the money to build this and we got to go build it, right? So, the big gains have been made in a lot of these juniors. Now, they got to do the real stuff to get to that next level. But now, if I look at that next level of these free cashflow companies, they’re trading at such big discounts that why do I need to go.
Marin Katusa: Look, it goes back to the uranium days when people would talk about, oh let’s go look for uranium. And I said, why? When you can go buy permit to build things for a third of the cost that would cost to build it. So, why take that risk on? And then you still get a four or five bagger out of it. I get that everyone loves financing, a geologist with a dream and a box of crayons. But generally that ends in misery.
Frank Curzio: You know, you’re bringing up uranium. You’ve been bullishing your rating. And you’ve got me in some deals of uranium a long time ago, and it took longer than expected, but we had five-year warrants on a lot of these things. What’s your view on uranium now? Because for me, I took half off the table, which was very, very good. And I was a little early. I did about three, four months ago. And, but the reason why I took half off the table is because we know the fundamentals. We know there’s huge demand. We know there’s not enough supply, electricity companies are going to come out. They’re going to have to buy, but they’re not buying for some reason, and the prices aren’t going higher right now. They go high just by a little bit, which surprises me. So I say, you know what, let me take half of off the table.
Frank Curzio: What is your view on uranium? Because I know you’re investing a lot of these things. Is it the same thing? Hey, these things have run up a lot. You got to take some off the table or do you think, hey, this is just the beginning of another bull run.
Marin Katusa: So, I actually don’t have that many uranium investments, but the ones that I do have are very large positions. Now, I haven’t sold any of my position. We recently put out a Katusa free ride on two of them. And same thing, you know, the subscribers were in, they’ve got three, 400% gains, nothing wrong with taking some cash off the table and having cash to deploy when the opportunity arises. That’s how you’re successful in this game. For myself personally, I don’t think anything has changed in the uranium market. Spot still $30 per pound, other than the material coming out of the former Soviet Union, not even the Athabasca Bays in Canada can make money at that number. Right? So again, be super selective. I don’t think anything’s changed in the near term and stick with the best teams that have world-class assets that are in politically stable jurisdictions. I have zero interest in putting any uranium dollars in an area where you’ve got a higher security to get to your project. Been there, done that. And here’s the flat out truth, guys. It rarely ever works out.
Frank Curzio: What’s your opinion on Northern Dynasty. That’s a company that we both share and we did incredibly well because we’re just so undervalued. And when you took me on that trip, I think it was like 35 cents. And, before we went, I really didn’t have high expectations for the company, then we had that management team, Ron Thiessen, all these guys and realized a lot of it would just be assholian environmental concerns. And we came back and everyone was kind of laughing, seriously, laughing at us, laughing at us at dinner, right? When I asked who, who’s the best stock pick, what’s the best stock pick you have? Went to a pretty big dinner, a lot of analysts there and they were laughing at us. And we said, look, this is pretty big. And I think it went up 900%, a thousand percent, but now you’re seeing the political stuff.
Frank Curzio: And I’m bringing that up because you just mentioned, I’m not going to bother with going any place that I have to protect myself as guns or whatever. But is that something that you’ve looked at lately? Because I always get a lot of questions on it. For me, I’ve avoided it because why deal with that concern when there’s so many other good names and the space that you can go into? And it sucks cause they do have a good management team. And a lot of that seems like BS to me. It doesn’t seem, it is BS, a lot of the environmental concerns.
Marin Katusa: The interesting thing, I think that project would have done a lot better if Trump actually never did win. Ironically, because of that though, it got a huge catalytic push and share price because of it. The shorters came on and did the whole discredit, not needing to use facts. I fought it, we made huge money on it, but I did exactly what I told my subscribers. We took money off the table there. And then we eventually sold. That is a management team that are exceptional, but they will have some serious forces against them moving forward. There’s ways to make it work moving forward. And the reason why I’m not buying it right now is it’s in that legal bind period where it’s going to be lawyers going back and forth. And I generally don’t like spending time with lawyers, and that’s kind of where I’m at with it.
Marin Katusa: The deposit should be mined. It will be mined. Question is when, and by who. You don’t find pebbles very often. The last world-class discovery, like a pebble, was one that you were there in the early days. It started here in my office in Vancouver, it’s called Solaris and Richard Warke, and the team that they’ve done on that, I remember when it was 50 cents and my subscribers got it at 50 cents a share. It’s 12, $13 right now in the market. It’s been 20 years from a Solaris to a pebble. You don’t find world class multi-billion ton, high grade deposits annually. That happens once a decade. So, eventually when the world electrifies and America gets there, technology will bring that into production. I think right now, just sit back and see, but when it’s time, that’s a monster.
Frank Curzio: So, Marin, let me know what a day in the life of Marin Katusa is these days. Because usually when I have you on the podcast you’re fired up, ready to go. Now, you’re like nice and calm and happy, seem like everything’s going real well. Is it, do you still get a lot of deals across your desk? And you just like, listen, I’m not involved. So, it’s not as stressful. And you’re like, look, I’m sticking with the major guys because there’s more money to be made there. I have my positions already. I mean, what are you seeing in the marketplace? I mean, there’s always people that want to get funded for everything, not just in your industry and resources and all industries, even I get millions of calls and stuff, but what are you seeing these days in terms of the funding and how you’re reacting to that? Are you just, hey, everything’s totally off the table when it comes to more specular things, or is it just, hey, cause you do seem like you’re a lot calmer, a lot nicer. I mean, I’m surprised, man.
Marin Katusa: That’s just the beard. You’re just more attracted to me right now. Look, I just put out a book and people wonder why would you do it on May 25th? Frank, that was nine years ago, I had open heart surgery. The first book was a result of staying at home. So, I wrote a book in recovery that became a bestseller and I have some really unique perspectives, and I’ve reached all my professional goals. I don’t do things for a gain anymore. If I don’t like the management team, you know my style, if I truly don’t want to be around with these guys, I don’t care if it’s a quick double, triple, quadruple, I just won’t play. I avoid FTDs which are financially transmitted diseases. I just stick with the right guys, my Ross Beatys of the world, the Bob Quartermains of the world, the Amir Adnanis of the world, I stick with good people.
Marin Katusa: And there’s a pattern that I’ve seen to these guys, you know them. And these are guys like Jimmy O’Rourke, I’ve been partners with this guy for almost 20 years and it’s just a handshake, Olivier Berte. When I first started out, I worked with these guys and I didn’t even have an employment contract. It was a handshake deal. When we ran the funds, multi-multi bit, talking about a big fund and we don’t even have an employment contract. That’s how I like to roll, you and I. It’s a relationship thing. So, where am I at with that? This book was a very big endeavor. It’s over 450 pages, and I’ve kind of built it all up to prove the math facts all the way. And then the forbidden chapter, which is the end, is probably the thing I’m most proud of in my career because I’ve done something that no one’s ever done before.
Marin Katusa: And you know my style, love being the first to something, it’s a way to feed my massive ego and just the deals that I’ve done. I’m very happy. Like the last time I was on your show, I was in quarantine by myself for two weeks, after being away from my family for a week. And I was writing the beginning of the book at that time, Frank. You locked me up into a place. I like to be productive, and I came up with the book.
Marin Katusa: Life’s good. Health is good. The portfolio’s crushing it. We’re doing so well. And I’ve stuck to my framework of, I don’t need to go to these super risky places to get big returns. I can actually invest in projects. I remember a big Serbian project that I was the first on, run by my very good friend, and we were vacationing at my places that even before I was married. I was single at the time, we’d be vacationing in my place on the water.
Marin Katusa: We talked about this project and the market just had it totally misunderstood. Serbia, oh my God, is there a war going on there? And yet the people are loving. It’s a great place to do business. And yet, they’re willing to give multi-billion dollar market caps to an area that management can’t even go without security and body armor. The world is so mispricing risk. I talk about that in the book, I talk about in our markets today, about coming risks to the market that nobody’s talking about. So, I guess to answer your question, Frank, this is a long winding way I’ve been there, done it. I’ve kind of figured the game out. You pick right, you sit tight, follow the best people and pick your windows when things are cheap, and no one’s talking about it, load up. When it’s popular like copper today, take your some money off the table. And don’t forget about those beautiful five-year Katusa warrants. There’s a way of those paying down the road.
Frank Curzio: No, and I definitely generate some money off of that. So, then let’s get to your book here. So, “The Rise of America,” surprising, right? From resources and writing about everything. But this came as a surprise to me that you were writing this and look at folks. So, this is out, guys. You could actually buy this right now, right, it came out yesterday. And talk about the book a little bit, because from what I gather, there’s so much of a negative connotation when it comes to America right now, where just the politics and the separation, all this stuff, and you say, listen, you got to ignore that because America is in a great position right here. I don’t know if that’s the quick recap, but let’s hear it from you.
Marin Katusa: Being Canadian, Trump did so much damage from a non-American’s perspective of America. You talk to the average Canadian, Australia, European, they think America is this backwards place, but yet, they’ve not traveled through America, but yet they follow all of the American social media stars and want to live this American lifestyle, right? So, there’s so much misinformation out there and I’ve never seen it so misguided. And I talk about during the height of the quarantine and people are like, look how screwed up America is. And I’m like, wait, watch America. America does its best when its back is up against the wall. You go back throughout history, look at what America has survived. You look at what the American innovation has created.
Marin Katusa: And then I’d break down into the demographics. I break it down into economics. I break it down from a G2 world, what’s going on. And people think, oh my God, America is, the dollar’s trash. What do you want to buy the Wan? The Yen? The Euro? The Canadian dollar? You ask yourself and go, jeesh, was there ever such misinformation? Other people keep sending me data. Oh, but look at its debt. Have you looked at Canada’s debt to GDP? Have you looked at the individual debt levels? Have you looked at the Euro? What about Japan? So, when you start looking at these things, and then there’s this misconception, Frank, specifically in where I come from, in the resource world, is about how China’s the new superpower that’s going to dominate everything. And, America’s glory days are in the past and America’s in this MMT, and I say, that’s complete nonsense.
Marin Katusa: First of all, America is not at MMT. We’re at FMC. It’s called fiscal monetary coordination. And guess what? It’s not the first time it’s happened either. Do you know what built America to the glory days of the fifties and sixties? It was FMC after World War Two. And I break it down into all the patterns. What fueled the growth of the expansion to the west? Things that built the Hoover dam in California and all that stuff. It was FMC. And this new industrial revolution that’s going to come to America is going to be funded by low cost of capital from FMC. And I know this sounds really, let’s all get along and happy dappy. No, man, it’s coming from the guy who’s the largest independent financier in the commodity sector. Frank, you went with me and was it 2015? When I made that huge bet on a green energy company that was trading at a 90% discount from where it was trading four years earlier.
Marin Katusa: And I was telling you why I was going to put up all this dough. And we look today, it was a six bagger. That’s a huge score for my utility. And at the time, the pushback, you supported me in that, and people like, oh, well, it’s not economic. Okay. Improvements and costs. The costs are down 90% decade over decade. And it’s going to continue to get cheaper. Yet, there’s going to be a huge push into these sectors. And that’s where I talk about this cross-flation. As we go electrify, copper’s going to be required, but there’s going to be improvements to that. So, this whole thesis that copper has to get to $10 to meet the demand, eh, once Goldman Sachs is jumping on something, Frank, the big money has been made. Okay. So that’s all, I’m just trying to warn people.
Marin Katusa: And the book will push specifically resource investors. It’ll push people’s comfort level, but I prove it with a very factual data-focused approach. And then, it’s a big read, it’s 450 pages. And my published was like, can you make it to 280 pages? I said, no, you already have a bestseller. You can kind of dictate terms with the publisher. This is my final book. And it’s my framework. And the best part of it is since I finished it in January, when you write something and you release it to the world, you’re always wondering, jeesh, people are going to attack it. What could I be wrong? And this and that. Everything that’s coming out from not just the American administration, from the industry, from the unions, coming out of Japan, the EU it’s actually supporting all of these vectors.
Marin Katusa: These catalysts that I’ve been talking about that are going to really result in the rise of America, the rise of America and the remaking of the world order is showing this evolution that is happening to capitalism. There’s capitalism 2.0, which I call stakeholder capitalism. And I really break it all down, Frank, where the capitalism that our parents knew, or what we learned in school, that’s over, and how to move forward and how to position yourself to make a fortune from this. That’s essentially what I’m trying to do with this book.
Frank Curzio: You know, it’s interesting because when I first saw the title of this, I’m like, wow, you live in Canada, you’re writing about America, right? Not that you don’t know America, but now listening to you, it does put in perspective because, America, all we do is we complain a lot. We complain a lot and you travel the world. I travel the world. You travel a lot more than me. And just to put things in perspective of how people get pissed off on their iPhones and the new cars and the yelling and traffic and the hate, everybody can hate everything. But coming from outside the U.S. actually, I think you could really see our perspective a lot better because you’re in Canada.
Frank Curzio: And explain what’s going on in Canada, because the emails that I get, it seems like it’s easier to go to North Korea than it would be to Canada right now, because it’s just so over the top, which is sad because I have a lot of friends there. I love speaking at conferences, if your conference is there, but it seems like it’s still completely closed. Is that exaggeration or, and that probably gives you a good perspective of a lot of great things that are going on in the U.S., compared to other places that you’ve been in and even live now, right?
Marin Katusa: So, I’ve always been what I call an independent thinker. I don’t do well in big groups because I’ll listen to people’s nonsense. And I remember in the summer, they were looking so down upon America, I was like, what are you talking about? Like the vaccine and watch America on this. And we’re seeing it in real time. And now the average Canadian has their tail between their legs. And they’re shocked about these useless bureaucrats and politicians that have disappointed them.
Marin Katusa: The reality, Frank, is yes, you’re right. For what I had to go through to book my own plane and bring my geos and engineers to a project, you’re talking about a $500,000 commitment for a project. Now that specific project was worth it for me because I put up so much dough and I needed to do the due diligence where I felt comfortable doing what I had to do with my team and everything there, that it was worth it for me. And it worked out great for my subscribers. We made a huge score, but I’m not going to do that for any project that, you know that my travel schedule and you’d never think twice about travel. Now, it’s got to be really worth it for me. And that in itself is actually a pretty good filter. You know, I’m going to take that approach moving forward because Pareto’s law is so true in investments where if you just focus on 4% of your stuff, you’ll probably still get two thirds of your returns.
Marin Katusa: But you look at the innovations moving forward in America, you look at where I see things happening from an environmental standpoint, from a carbon credit standpoint, from going to carbon neutral.
Marin Katusa: This coming more on climate… it’s going to be declared a climate crisis, and whether you agree with it or not, there’s going to be trillions of dollars set towards this. It’s going to be like nothing we have ever seen before, and that’s where I keep talking about the forbidden chapter. It’s going to shock you. My publisher was like, “Hey, we can’t put this in print, Amazon’s going to prevent this, from people reading it.”
Marin Katusa: I expose what Amazon actually does, I expose Walmart. And is it a coincidence that some of America’s wealthiest families, guys that have made hundreds of billions of dollars, are the largest facilitators of pollution from China?
Marin Katusa: Those days are over, that’s gone unchecked and it’s done. And you’re going to see politicians moving forward, now as you and I, and investors listening to this, if you can position yourself, the gains that you’re going to get on this are unlike any.
Marin Katusa: And Frank, I’ve got my pulse on the resources and look at my track record. I would not be doing this if I didn’t think it was an incredible opportunity. And then you get the second order effects. I truly believe that it’s going to level the playing field with China. I do believe that you’re going to have incredible benefits from an environmental standpoint, and this is a guy who waited five years before I invested into green energy companies ’till it made mathematical sense. That’s where we are today, in this game. It’s very different, Frank, but I’m quite proud of it.
Frank Curzio: Now, being in the resource sector, and I know you’re talking about Ross Beaty, when you’re talking about the green energy company. And it was interesting because I learned an incredible lesson there, because I was scared of green energy back then because nobody could make money off of it. But what I realized is people can’t make money off of it because it costs a fortune and decade, if not decades, to actually build. But a lot of the infrastructure’s in place and once in place and you have this stuff, which we saw firsthand from some of these projects, the water’s going to come out forever, right? You have wind forever, sun, you know when it’s out, whatever, but it’s just, once you have the infrastructure built, it’s constant, it’s generating cashflow forever and ever, and ever, and that’s where Ross Beaty put that project.
Frank Curzio: Where are you right now at green energy? We’re seeing, such a move in it. Now, we’ve seen a lot of these names come down, rightly so. They’re up three, four, 500% just because Biden got elected, we see a massive push by all of corporate America, right? You look at presentations, I look at presentations, annual, quarterly. They all have the ESG, this is what we do at ESG. Now, they include four or five pages on it. Where do you see, in particular, where you can make money in this sector? Because, it seems like this is one sector that you’ve been paying close attention to.
Marin Katusa: Yeah. Look in March 21st of 2020, I did an emergency alert to my subscribers. I put up huge money personally, and how to play it and you know where I’m at Frank, and history has proven that it was the right way to go about it. It’s all about adjusting your risk. And we bought Brookfield, which is kind of like the Exxon of green energy, it’s the world’s largest green energy producer. The largest green energy producer in the U.S. is NextEra. And these companies were huge wins for us, multibaggers, and people will say, “I want a 10 bagger.” Well, I wish you great luck. I’ll put up my 10 bagger list to anybody in the business, but that’s not how you do it.
Marin Katusa: You have to look at your risk adjusted return, and you could buy incredible value. And you get three, four times your money. You sell half, pay your taxes, you still have your half your original position, and it’s all free. And these are dividends that I’m going to hold these stocks until my kids give it to their kids. And I just literally wrote a report last month on what exact price am I comfortable buying my next first tranche in specific green energy companies. It all comes down to one phrase in the green energy game Frank, cost of capital. The bigger you are, like a Brookfield, their cost of capital is lower than say a startup. And this is something that I’ve been talking about for years and years. And maybe I don’t do a good job explaining it because math is boring, or maybe I’m just boring. But the point is when you have a lower cost of capital that, you said the key phrase, most of these companies didn’t make money.
Marin Katusa: And because there was a higher cost today, in the right region… And just like anything, Frank, not every project is going to work. So, you got to do your homework. You know, this isn’t the high school investing where everyone just wants to get along. You’ve got to make money doing this, or you don’t survive. But you look at the cost of capital, and then you look at your returns, the oil guys can’t compete with this. And then that’s why you see the BP’s and Exxon’s and Chevron’s coming out and saying, okay, we want to get in this game. But their cost of capital’s too high. The game has changed. That’s when I wrote about Gebo’s the green barrels of oil equivalent, and I explained this whole thesis back then in 2015, when I first published it, and I keep updating it all the time, the oil patch back in the day could have owned all of North America’s green energy for less than 20% dilution.
Marin Katusa: Now, the game’s turned upside down where the green energy players can own the oil patch for very little dilution. And they can take all of the cashflow from barrels of 30 oil and fund more green energy. And the only way to control the destiny of oil is to own it. That’s where I’m going to see things happening. And from an economic standpoint, remember, we talked about cross inflation, you’re going to see deflationary pressures on certain sectors, inflationary pressures on others. And the smart management team are going to take advantage, and it all comes down to cost of capital.
Frank Curzio: Good points, definitely makes sense. So, I want to finish up here with some ideas, right? We know that everybody loves ideas, and they love having you. You have ideas. I know you’re not into too many small cans. I don’t know if you are in junior miners or not, or if there’s large pass specific names that you like, but there are any names, even Grenada Energy Space, or maybe even another commodity that you’re looking at that we haven’t talked about is palladium. If it’s silver, we haven’t talked about, but with something like that, that you really like, are you looking at what a good management team or something?
Marin Katusa: Frank, mark my words on this. And I know exactly what your response is going to be. The biggest value commodity moving forward in the next 25 years is not going to be gold. It’s not going to be Bitcoin. It’s not going to be silver. It’s going to be carbon credits. If you’re a young person, if you’re the Frank Curzio of 25 years ago or the America two of 25 years ago, and you want to make a substantial net worth, start exploring on how to get into this game of carbon credits. This sector is going to dwarf oil. Oil is the biggest sector on the planet at $2.1 trillion a year. Okay? It’s like 5% of the global GDP. Carbon credits, you look at what is happening so far of the 5,300 publicly listed north American and European companies with over a billion dollar market cap about, just under 9% of them came out with a plan to offset their carbon footprint and a plan to come out with carbon neutral or net zero future by 2030 or 2050.
Marin Katusa: That’s less than 10% of the companies. Half of them have to report their S1, which is a scope one. Frank, in five years, the regulators are going to make where your carbon footprint is a liability. And there’s a huge growth of opportunity. Companies like Chevron, Shell, BP, Exxon they’re scrambling right now because their cost of capital is too high, when the green bond market is the biggest growth 60% year over year since 2013. And they know they have to go neutral. How do you go neutral in this? It’s outperforming Bitcoin, it’s outperforming carbon credits. It’s outperforming every commodity on the planet. That’s carbon credits, and it’s going to continue to go higher. Why? Because it’s the ultimate Geffen good. Geffen good is essentially… It’s non replaceable, and as the price goes up, the demand for it goes up.
Marin Katusa: There’s an IPO coming out that I’m personally going to be the largest investor in. And some of the biggest names in the business like Ross Beatty, that they’re participating in the IPO, you get a warrant. That’s how you play the game, Frank. If you wanted something that no one’s talking about, you’re talking about a guy who was the largest gold and resource mining financier, independent financier in the world for this stuff. And I’m saying, over here is where the puck is going, and that’s where I’m putting substantial amount of money.
Frank Curzio: That’s great stuff. And you say you’re getting into an investment, but it is kind of hard. Is there specific companies? I know in my field is security, tokens and stuff. There’s a couple coming out of a carbon credits. I’m very familiar with it, just from Al Gore and the amazing job he did. Whether you like him or hate him, just building it up and telling you the world’s going to end, which it should end by now, based on his first presentation, the guy made an absolute fortune, right? You got to give it to him. So, is it coming to a point where there’s going to be companies that you can invest in through this? Because right now-
Marin Katusa: I think it in 12 to 18 months, it’s such a new sector that there’s so few companies in it. But I think in 12 to 24 months, you’re going to have hundreds of me too, companies. And again, be very weary when investment bankers and brokers are talking about the sector, you want to be the first in the room, and then you get the best terms when there’s no one else in the room. That’s how… Usually I’m the smartest guy in the room when there’s no one else in the room, and that’s how I’m able to structure these deals. So, that’s how I’m going about it, Frank, and you’re right. There’s very few ways to do it. And that’s music to my ears. In 24 months, it’s going to be a sector in the market caps of hundreds of billions.
Marin Katusa: And then you’re going to be very selective. But we’re talking about cashflow today. We’re talking about… Imagine you’re able to buy a gold mine, that is the largest gold mine in the world. And you’re paying a hundred dollars per ounce of gold, not 1800, and it’s permitted and it’s built. It’s just, nobody knows about this company because they’ve been doing it privately. And remember that one lesson that a billionaire told you and I, while we were in a helicopter and you asked them, what is the number one lesson you’ve learned in your career? You’ve had win, over win, over win, he’s made people billions of dollars. And what did he say, Frank? Own as much of the discovery or company you’re working on, because you can never get it back, right? That’s the key, own as much of it as you can. And that’s where in this sector, that’s what I’m doing.
Frank Curzio: No, that makes a lot of sense. Well, Marin always great stuff. And if someone, I remember that conversation too, of us being in a helicopter, it was fantastic. I mean, we take a lot of helicopter rides together and I think about it. So hopefully, they’ll open up a little bit more soon, especially in Canada. But if someone wants to get in touch with you, find out more about you, how could they do that, buddy?
Marin Katusa: My Twitter, or just go to Katusa Research, I’ve got tons of information there, and I really hope people read the book because it’s something you’ll never have read anywhere. And you know my style, I have to be unique. I will never write about something that other people are talking about because that’s just noise. This is original thinking in a sector and sectors that are not being discussed, but there’s being significant, behind the scenes movement. And I really think it’s going to challenge people’s narrative that I think most people narratives are wrong.
Frank Curzio: I’m going to end on this because we do a video now. So, a lot of people still listen to this on iTunes. And since you look so good with your beard, I wanted to say, since you wrote this book, I know you got the insight from this person, probably right? Since you look just like them, it was Ted Cruz. You look like… He’s a good looking guy. I’m not putting… Do you… I like the gray beard, I like the new look, the black shirt, you look good man. Seriously, you look like you’re in good shape, like I said earlier,
Marin Katusa: Tom Cruise or someone else. But Ted Cruz, really?
Frank Curzio: No, that’s a yeah. Right? Tom Cruise. Maybe next time, next time. But listen-
Marin Katusa: I’m trying to go for the aging rockstar look, not an aging politician.
Frank Curzio: That’s great stuff, buddy. So listen, thank you so much.
Marin Katusa: You just ruined my day. I’m going to go home and cry now.
Frank Curzio: To have you on video. When you see it, people definitely going to agree. You look alike, and it’s not bad. It’s not compared to someone that’s bad. It looks pretty funny though. It just, the gray in the beard is awesome. So, if you get a chance to watch this on Curzio Research YouTube page, definitely do it. And Marin, good luck with your book, “The Rise in America, Remaking the World Order.” I know it’s going to do great. So, I’m really excited for you, man. I know how hard you worked on it and I’m proud of you man. It’s a pretty big book, lots of pages. And I know it’s going to do well, man.
Marin Katusa: Thank you.
Frank Curzio: Hey guys. Great stuff from Marin. If you get a chance to watch Curzio Research YouTube page, we have all these videos of the interviews of Daniel and myself.
Frank Curzio: When we’re on here together, myself, it’s pretty cool. People like watching it. I like watching it as well. Not myself, but other podcasts and things like that. I kind of like watching them sometimes and listening to them, which I know most of you, based on our downloads, all listen in through iTunes. But definitely take a look at it because Marin, calm. Surprised to see, nice to see though, calm and you’ll see his new look, and he does look like Ted Cruz. I put up a picture of that, but I like poking fun, we’re really, really good friends. And that carbon credits deal he’s talking about it, it’s putting the most money they put it in that deal. He’s opening it up to Curzio Research subscribers. So, I’m going to send you a letter, probably tomorrow with all the details. It’s really amazing. Personally, I’m going to put at least 50,000, probably a hundred thousand dollars if I can into this deal.
Frank Curzio: And I want to be able to open it up, I guess, wait for credit investors. But this, I really liked the deal. I researched it and I’m excited about it. So, I wanted to… I asked if we can give it away to Curzio Research subscribes. He said, sure, not a problem, which he’s not doing for everybody. So, it’s really, really cool, if you’re interested in that. You’re going to get a letter, learn more about that stock. You’ll see a presentation on if not it’s okay, but something that I’m putting a lot of money into… Remember, I don’t get paid for doing it. I don’t get paid for recommending a stock. So, I wear independent, a hundred percent. So, when I’m putting my money in certain deals, in certain stocks we recommend and these things come down. I’m getting hurt too.
Frank Curzio: But you know, we put our money where our mouth is, and that’s one of the things we do encourage is research because a lot of our competitors don’t allow their editors to buy those stocks. They’ll tell you, it’s going to go up 20 X, 50 X, a hundred X, but Marin’s putting a ton of money in it. I’m putting money in it and you know, we’re behind it. So, this isn’t something pumping it because really, if you’re saying something’s going to go up 20 X, and you’re a newsletter writer, and you’re not allowed to buy it, why would you give it to anyone? Why don’t you save for yourself? You don’t want those 2000% return? So, for us, no BS here. And if you’re interested, that’s fine. If not, no worries, but I’m glad that’s opened up. I love to share good ideas, which I don’t do often from everybody in terms of sending letters and stuff like that, subscribers. So, if you’re interested, you get a letter and you can click. If not, no worries. Now, a lot going on the markets as usual and let’s get to my buddy Daniel, what’s going on, buddy?
Daniel Creech: Frank Curzio, another wonderful Florida Wednesday, man.
Frank Curzio: I know it’s getting hot here though. Right? It’s like 95-ish now.
Daniel Creech: Yeah, it is. It’s getting hot. And more than that, it’s getting more humid, but hey, we’re lucky here on the east because at least it cools off in the evenings and there’s always a breeze. So it’s not… It’s not miserable. Feel sorry for us. We’re on an island working our butts off.
Frank Curzio: You know, when we do this daily, it’s, you know, I’ll ask you, you know, hey, what are some of the things that you saw, that you want to talk about? And some of the things I’ll know a lot about, some of things you’ll know a lot about. But one of the things that I wanted to talk about today, which caught my attention, and I’m not too sure if it caught your attention that much, is the Olympics, right? So, you’re looking at the CDC, just added Japan to the do-not-travel lists. And this is two months ahead of the Olympics. And this includes people who are vaccinated. We were told, you’re vaccinated? You’re good. You’re fine. We don’t have to wear masks in America, right? No more right? Indoors. If you got vaccinated, which nobody knows who got vaccinated, who didn’t get vaccinated, it doesn’t matter. But,
Daniel Creech: Not yet.
Frank Curzio: Not yet, soon you will with vaccine passports.
Frank Curzio: So for me, when I looked at this, I kind of thought it was insane because Japan just issued their highest alert on COVID. Their highest possible alert on COVID since last March, the highest alert. So, it was the worst it’s ever been. Big, she wants to have the Olympics. They built stadiums. The amount of money goes in, the economic benefits all this. If they don’t have the Olympics there, or if they see a lot of these athletes aren’t showing up, it’s going to crush that economy because they put literally billions into it, right? That’s what someone does when they host the Olympics, they do it start five years, six years in advance. And then they build this whole event up. Now, for some reason, the CDC said everyone in America would band and travel to Japan. And so I was like, holy shit.
Frank Curzio: I mean, what happened? Is it really bad there? Because I did statistics on all the countries, and you know, Europe and Italy and Germany and even in China, the U.S., and stuff like that, Japan was handling the situation pretty good. So, I started looking at statistics. And if you look at Malaysia, COVID is spreading very, very fast. One of the worst right now. There’s 205 cases per every million people per day, right now. That’s more than India actually. So India, which I want to talk about how bad it is over there. It’s a 150 cases per million people. In the U.S., right now, as the other day, lay statistics, we have around 75 cases per million. And we put out, CDC, no more masks, everything is basically open, right? You almost can open up a hundred percent right now, pretty close. Unless, you know, you’re in some crazy areas in California, New York. 75 cases per million U.S.
Frank Curzio: Right. And we’re okay, right? Vaccinated can go out, no mask, nothing. Japan, as of May 23rd, lay statistics, we were 75 cases per million. They’re seeing 39 new COVID-19 cases per million. So, about half the U.S.
Daniel Creech: 39?
Frank Curzio: 39. And the CDC just said, hey, we’re banding, right? You’re on a do not travel list, you can’t go there. And for me, this is such a big story. One is, I can’t believe we have, I’m sorry to say this, and I’m going to curse, but the assholes in charge, and how political this is, and we were talking about lives, right? We’re talking about, have you ever met, hey, Danny? Have you ever met an Olympic athlete or anyone who’s trained for the Olympics?
Daniel Creech: I don’t believe so.
Frank Curzio: I’ve met a few and you don’t see them. You don’t see them for a three-year period. It’s 12-hour training days, at least. You’re eating a certain way. Your whole life changes. You’re grinding, you’re not hanging out with your friends. Two to three years easily to prepare, to compete against the best in the world and get conditioned. And now, when it’s two months away, you’re ready to go. They’re canceling it or they’re saying, they haven’t canceled it yet, they’re thinking about it. But they’re saying, you can’t fly to Japan because of political bullshit. And to me, that is a huge story where you’re taking athletes, who we could easily say, hey, Eddie, one of yours because Japan has to be vaccinated. Fine.
Daniel Creech: Wow. Hey, hey, hey.
Frank Curzio: No, but I’m just saying, every athlete, a hundred percent of the athletes would get the vaccine opposed to not going to the Olympics.
Daniel Creech: Are they actually canceling it? Is that still a rumor?
Frank Curzio: It’s not a rumor. They’re talking about that in Japan.
Daniel Creech: They are talking? I knew it was coming up because I saw the announcement you’re talking about. And I’ve seen some pretty funny Olympic commercials, as I’ve caught different short segments of TV here lately. So anyway, I’m sorry.
Frank Curzio: Not at all. It’s just, for me, it reminds me of Zika where, how many people didn’t go to Olympics in Brazil because of Zika? I don’t know how many people died of Zika, hardly anybody. But yet Jordan Spieth, Jason Day, or Mac, a lot of golfers, a lot of tennis players. They said, hey, you know what? We’re not going, and we’re worried, and, and you look back-
Daniel Creech: Justin Rose. It was okay with that because he’s an Olympic gold medalist.
Frank Curzio: Who’s that?
Daniel Creech: Justin Rose won that.
Frank Curzio: Yeah, Justin Rose won that.
Daniel Creech: So, he’s loving everybody staying home.
Frank Curzio: Well even in golfing, these professionals, but that, that’s something that comes along every four years. You had a shot and because of something with Zika, which doesn’t even really exist too much anymore. And again, people say, well if your wife gets pregnant then there’s a risk or whatever, so maybe that’s why they didn’t go. But, we look at statistics years later, we see just like, we’re going to look at statistics of COVID all the bullshit that a lot of it was all fake and made up and garbage. We know the people we had to protect. It was very serious. We know that school should have been open the whole time. Florida schools have been open for over a year, same with Texas and playing sports. And they’re just opening up in some places right now, which is fricking insane. When you look at statistics and kids.
Frank Curzio: But to me, major story where, you’re impacting people’s lives, this is what they’ve done for the last three years. This is all what life’s about and you’re taking that away from them off of something that makes zero sense. 39 new COVID-19 cases per million. It’s half of the U.S. Why did the CDC come out and put Japan on the banned list? I don’t know? Maybe you could answer that for me. I mean, I have no idea.
Daniel Creech: I can’t no. No. I have nothing new on this. This has been politicized since the very get-go. We know that now with the, I know you touched on a little bit about maybe the virus started in the lab instead of transferring from a bat to human. Another Trump’s, see? I told you so, because he was a crazy idiot for even mentioning that, which he did several times. And now the mainstream media, including, I believe, the Washington post is coming around. Fauci flip-flopped, Fauci has gone back and forth on that. So listen, this has been politicized like crazy. It is depressing. It is sad. I hope and pray that we get back to somewhat what they allow us peons to look at life as normal. But for all the athletes that work their butts off, it’s even more extended because the Olympics are less frequent, but this is why it was so heartbreaking for me to see him cancel the NCAA basketball tournament when they did.
Daniel Creech: Because again, for seniors, a lot of Olympic athletes, this is your last chance, maybe. This happens once every four years, right? That’s a big deal. But hey, the irony here is from a macro picture, which I love to talk about. Is that you can choose to ignore politics. You can choose to say, ah, politicians, those guys are all scumbags, I hate them, I’m just going to ignore life. But the issue is, in reality, that if you choose to ignore politics and you get politics that are crazy and want to control every aspect of your life, they get voted in. And then this is the life you live. You maybe not have to think about it. You might cancel. That’s still on the table. You might cancel the Olympics two months ahead of time. That’s pretty impressive. Think of the power there and it’s all done under the blanket of hashtag; we give a crap about you and we’re saving lives and all that. It’s all politicized. So, we just try to make money off of it, which real quick here’s how you do it. If it did come from a lab, the coronavirus, Frank, is that an act of war?
Frank Curzio: It is an act of war. Absolutely.
Daniel Creech: I’m just asking because why wouldn’t you bring that up? And then if it is, Lockheed Martin.
Frank Curzio: Lockheed Martin, bought all the defense companies, but I can tell you one thing, I brought this up in the intro, how China had everyone… Everyone was like, hey, let us help you out here. Right? They’re like, hey, you know what, let us help you out. It’s something new, never seen before. And they didn’t let the CDC in, they didn’t let the World Health Organization in. They didn’t let anybody in. So, obviously something’s going on. Plus they just contained it to Wuhan and said, okay, anyone in Wuhan can’t go to China, but you could travel anywhere you want in the world. Right? So, when I look at this, is it an act of war? You could consider act of war. That’s why I think they’ve been kind of not pushing that issue as much.
Frank Curzio: I don’t know what’s going to happen, but I do know if you really look at the details, this is a conspiracy theory. If not 90, it’s a hundred percent of the politicians are all on the take from China. Almost every single one of them. I mean the amount of money that China spends to get what they want through our political system is unbelievably amazing. It’s easily traceable guys. So, many people have written about this, I don’t care what side you’re on. It’s in the best interest. We saw that with Biden. We see Trump has hotels there. We see, listen, China is the growth engine of the world and you want to have access to it. But, and China knows that, so if you’re looking from our politicians looking to vote on anything like that, that’s never going to happen.
Frank Curzio: I don’t think it’s going to go any further and it’s gone right now. There’s not going to be investigations into, it’s going to be people shouting at the rooftops saying they want it. But in reality, you’re not, you’re not going to have it because it doesn’t benefit a lot of our politicians. It doesn’t benefit them at all. And I don’t know, but is it an act of, well, it could be considered an act of war. I think it’s an act of war, but bottom line, this isn’t China created a virus in order to, what? Why’d they create it for? Why do you think? To kill people. Why else would you create a virus like that, that could spread so fast in a lab. So, if this has proven then how could you not say it’s an act of war?
Daniel Creech: Yeah. That’s an easy, it’s going to be on the table and you’re going to see it in a lot of headlines, I believe, going forward. So, it’ll cause volatility, we’re going to have a lot more volatility in the markets for a number of different reasons. Inflation. We can get to that. But it’s one of those things, unfortunately, we have to wait and unfold and pay very little attention to it as much as you can because it’s going to be very difficult to get the truth.
Frank Curzio: It will. I mean, I think that was really, and you guys,
Daniel Creech: Hell, I’m pretty sure Zero Hedge got banned from Twitter for running stories about that over a year ago. And now, every major newspapers is running them. I don’t know why Twitter is banning them, but maybe they had a come-to-Jesus moment.
Frank Curzio: I don’t know. I don’t know,
Daniel Creech: Jack.
Frank Curzio: I can tell you that that was really Trump’s downfall. I think when he really started going after China. You could say, immigration, the wall, and stuff like that, the masks, all the investigations, everything, but full-straight, as soon as he’s raising terrorists and he’s not letting China get away with anything. That had to be a massive change there because the amount of money our politicians, guys, I mean it’s easily tracked seriously, that they make from China is incredible. It’s just incredible. So, hey, you want to talk the good fight and you want to say that America’s is great. Listen, China knows exactly what they’re doing. It’s pretty scary right now. I don’t think you’re going to see this come out to, it’s never going to go that far.
Frank Curzio: It won’t go that far. It’ll be punishment or whatever, but not seen as an act of war, but it should be seen as an act of war since three and a half million people have died because of this, three and a half million people. And a lot of that could have been prevented if you just let people in China, study this virus, to see what’s all about. We could’ve stopped travel a lot earlier than that, months before. But I don’t know, it’s crazy. But like I said, there’s always ways to play it from a stock perspective when it comes to a defense companies, everything it’s funny, you said that, but another main story I cannot say it was, this week was Bitcoin going up and down, right. We’ve seen both sides on Twitter, yell and stuff. It said a couple of tweets early in my intro, but other than to see Ray Dalio come in and saying that he owns Bitcoin and talking favorably about it to the point. I think it was Ray Dalio, right? Dalio said, I’d rather own Bitcoin than bonds?
Daniel Creech: Yeah. And that was by far the biggest takeaway for me with all the volatility and drama and stuff. We joked about, hey, somebody going to make a major announcement. I don’t want to go as far and say if Bridgewater, the hedge fund that he runs and started, or actually bought it. I don’t believe so yet. But he personally owns Bitcoin, which is a huge tip of the cap. I know everybody is caught up in Elon Musk tweets and Michael Saylor. And now, they’re talking with Bitcoin miners and kind of staving off. You got to give them credit because Bitcoin is starting to play the political game of you have to try to look forward and do some PR, some press control. So, Elon Musk thinks he’s the crypto God, self-anointed.
Daniel Creech: Everybody has to have a huge ego in this business. So, you want to go out there and say, hey, this is bad for the environment because you’ve got to cover your butt on what a waste your Teslas are for the environment. And now Bitcoin, and the miners, they get with two huge CEO’s, Michael Saylor of MicroStrategy, and Elon Musk. And they start talking about, hey, we’re going to be good for the environment. We’re going to transition our power usage and all that. It’s all BS in the big picture, so this is the perfect opportunity to use these headlines.
Daniel Creech: If you’re a believer in cryptocurrencies to add to those positions, or at least initiate those positions, because governments can ruin cryptocurrency, but it will be through taxes. And it’ll be through conducting the argument in a way where it’s harmful for you as an individual in, in just like every other excuse they make. It’s going to be better for you and better for society if they implement these rules. That’s how they’re going to do it; they’ll tax it out. Not just shutting it down, although that is a risk with environmental.
Frank Curzio: And guys, it wasn’t the news out of China that crashed the markets. That’s what it was being reported. Listen, China banned crypto exchanges, alternative trading platforms. In 2017, they came out, they put in more stringent rules of play 2019. And then it like a month or two ago? They said, they’re going to have their own digital currency. So, it’s in their best interest to make sure that nobody else could do anything with digital currency. Secure in or currency in the entire market. Right? So, there’s no surprise there, but yet people saying, China news is terrible. Nobody that owns Bitcoin is factoring… Thought that China was going to be a huge growth engine for this. No, it’s more about institutions here getting in. And it wasn’t Elon Musk saying, oh, green energy, which it’s flip-flopping back and forth.
Frank Curzio: And the fact that that guy could send a tweet and move hundreds of billions of dollars in and out of the market. And nobody says anything or… It is amazing to me. The reason is there’s a ton of freaking leverage in this industry. There’s a lot of kids that are leveraged a hundred to one even more. And you just need a little bit of a decline and that’s what happened, because these people are like, hold on for dear life to hold on. How many people have I talked to, have you talked to, I’ve been holding onto this for dear life, never, ever selling,
Daniel Creech: Someone freaking sold.
Frank Curzio: You sold a trillion dollars of market cap. A trillion dollar market wiped out in weeks.
Frank Curzio: Somebody was selling and a lot of that is leverage. It’s a good thing when you see some of the leverage comes out because a lot of these guys are going to tighten up their policies, even when they’re offering just a high interest on holding some of these tokens, which is the new craze out there that everybody’s doing. They’re going to dial back. It’s going to be more regulation, the good type of regulation where you have to pay taxes on your gains and stuff like that. That’s going to be good because that’s going to allow this to scale. I got to tell you, Daniel, in this industry, you’re looking at Coinbase, right? Coinbase came out, and now Coinbase said they’re going to trade… Dogecoin’s going to be on that platform.
Frank Curzio: If there’s at least like 60, 70, I don’t know how many there are right now. Whatever there is they’re trading on Coinbase, I can’t find information on probably 70% of those. I don’t know what the coin represents. I don’t know. You won’t even find the management team. You might find a LinkedIn with a couple of names on it. You don’t know how many tokens. They say how many tokens are outstanding. You really don’t know though. You don’t know anything. You don’t know the cash balance. You don’t know the business model. You’re not getting equity, so they don’t have to report anything.
Frank Curzio: But Coinbase is under the SEC now. It’s a publicly traded company. So, something’s got to break there. They either have to come out with more regulation and say, “Hey, we need companies.” That’s one of the reasons why our CEO token guys were getting our financials audited, this way we have transparency, and it’s going to result in if our company does well. Which, we’re doing well now and growing, that we will get institutions to invest. That’s how I’m looking at it right now. So, going through that process, should be done in a couple of weeks. It was a very long process and hard. It’s the first time we’re doing it.
Frank Curzio: But, that’s going to provide transparency, but you need that transparency. I’m just surprised that Coinbase is able to trade some of these. Who do we have? Elon Musk, all right, basically saying this is a scam or a fake. You have Mark Cuban saying scam or a fake. You have all these people coming out, basically a scam or a fake. And now, all these platforms are trading this fake bullshit security on their platforms, which is kind of crazy when you think about it.
Daniel Creech: Oh, it’s absolutely. It’s crazy. I totally get your point. There will be more regulation, no doubt. Goldman Sachs had a good report. They were interviewing somebody that used to work with John Clayton when he was over at the SEC. I don’t have his name right in front of me, but no doubt there’ll be more regulation of some sort with all this. How they get around it right now, I don’t know, but I’m going to suspect, and this is a guess. Listen, everybody knows what Dogecoin is. If you’re buying Dogecoin because you think it’s fundamental or you want to look into any business aspect if there is one, or any detail, you’re not paying attention. Really there’s no way that, that’s the market for that. So, maybe they get around it because there’s enough information publicly to point to, to know what it is.
Daniel Creech: Then also the thing is, hey, even if you know cigarettes are bad for you, you can sell them. So, people like to gamble. People like to speculate. It’s another form of Vegas in that sense. So, that doesn’t bother me near as much as it bothers you. But it is a good question from the SEC. I don’t know what their feeling is on that, but no doubt they will put their hand in the cookie jar and make some new rules going forward that all of us have to abide by.
Frank Curzio: Yeah, I agree. But we need more regulation. We need more transparency, that’s how you’re really, really going to scale this thing. But the reason why I came down is there’s a lot of leverage that came out of the market, guys. It wasn’t because of China. I mean, nobody, nobody had China as a catalyst for Bitcoin going a hundred thousand or whatever. But we’ll see how this plays out. Less leverage in the market is usually good. And we’ll see how it builds back up. But we did see, for me, I think it’s a positive sign when you’re seeing Ray Dalio come in and say, “Hey, I bought.”
Daniel Creech: Yeah. I don’t know how you can take that, granted he’s a multi-multi multi-billionaire so even if he put a billion dollars in it and lost it, he wouldn’t be hurting. However, it’s a tip of the cap. He’s one of the smartest best thinkers because he’s willing to change his mind. He has changed his mind when the facts change. From an investing standpoint, if you think Bitcoin’s going away, fine, you’re not going to pay attention. I’m not going to convince you. I’m not intended to convince you of anything. If you don’t think it’s going away, though, here’s how you play it.
Daniel Creech: When you see massive volatility like this, you want to look at, and just like Frank brought up, Coinbase. Coinbase should be reaping the benefits from all the trading activity and volumes going on because they charge fees. They can charge services for different things. They list new coins, that’ll gain more users and more attention. The other side of that is they’re not the only game in town. Galaxy Digital should be reaping the rewards right now. When prices fall, their private asset management can take deals, invest in new startups, invest in new cryptocurrencies, get coins, et cetera, et cetera. Think private equity. Think Wall Street, just in crypto.
Daniel Creech: They also do trading. This is from Coin Telegraph, good website that we constantly check. Voyager Digital, the Canadian trading app. So, like you talked about, Frank, no doubt they help fuel the leverage in this because they offer yields in different things on tokens. They just reported. So, they haven’t even really benefited a whole lot from this, just in general, I’m talking about the recent volatility, their third quarter results jumped 16X, revenue went to 60 million from 3.5 million, Frank.
Daniel Creech: Now, that is because more people have interest, more people were doing it. But my point is, is that when you see huge volume, you want to look at who’s benefiting from that. Yes, Galaxy Digital price has fallen. Voyager Digital has fallen. Coinbase has fallen, but if you’re just looking at the present price, then you’re not investing. You’re just emotional. You’re like a wave out in the ocean. So, think of who’s going to benefit from the volatility. It should be the three we just talked about. If you have positions, you either add to them or look to hold them, but know why you own it and know who would benefit from the environment that we’re experiencing.
Frank Curzio: No, that’s well said. That’s well said, and I’m actually pulling up something. So, I’ll explain it since if you’re watching this YouTube, you’ll see it. If not, I’ll explain it. But if you go to Coin Market Cap, Daniel, it’s really cool. It gives you just all the tokens and market cap strictly and supply and stuff. But at the top of the page, I’m going to show that on our YouTube page, they have a 24 hour volume of all cryptos. So right now, the time market cap is 1.7 trillion. It was 1.5. It came back to 1.7 trillion. It was 2.5 before the crash. But the volume right now, 24 hours is about 170.
Frank Curzio: But if you look at the volume and just take the last three months, so if you look at the volume of all cryptocurrencies. It’s right at the top. If you click it, you see like 130, 150, it hit at 200 a few times, and then April. Then all of a sudden, when you look at May, it’s 200, 250, 260, 300, it hit 400 one day. This is $400 billion in total trading volume in a 24 hour period. It’s almost constant where it’s, here’s another $400 day, which was Thursday. This is May 20th, right? So May 19. $400 billion. So, this is the volume. This is a trading back and forth, almost every single day after that is over 200 billion.
Frank Curzio: What does that mean? It means that these companies, all the ones that you just mentioned, they make more money the more people trade and you’re seeing more volume. So, these guys are going to see their earnings skyrocket next quarter. People look at it and say, well, Bitcoin’s down. You’re still seeing a ton of people trade this market, buying and selling, buying and selling. That’s why Goldman Sachs recommended, were up a ton on it. It’s volatility and liquidity.
Frank Curzio: If you have those two things, the investment banks, especially when you look at Morgan Stanley, Goldman Sachs, especially are going to benefit. That’s why they’re blowing out the earnings by like, whatever. I think if they’re supposed to report $5, like $12 or something, whatever it was, for the quarter record because you’re seeing more money being injected to the system constantly. More people have more money than ever. You’re seeing more and more and more trading. That’s good. Coinbase was over, I forgot, did Coinbase touch 400? I don’t know if it was over 300.
Daniel Creech: I don’t know, yeah, when it IPO’d, I’m not sure. I know it was over three for a little bit.
Frank Curzio: Then it came back down and then it went down to like 210 or something like that. Then Goldman came out, remember they came out a month ago and after a month, all these investment firms that are part of that offering, are going to come out and research on it. They’re going to have to put a buy rating on it because the thing is down so much. A lot of their clients are in it. We saw Goldman Sachs come out and say, “Hey, it’s worth over $300.” That was the first one. You’re going to see like three or four more reports, positive reports come out. Listen, that’s what moves markets. I’m just telling you how the markets work. They’re going to come out and say, “This is a buying of a 350 target price,” well, it’s at 220.
Frank Curzio: But it’s starting to move back up now because you see in Bitcoin kind of leveling out here, you see them buying coming in at 35,000 levels, or 40,000. I don’t know whether it’s going lower or higher. But what I do know is you’re still seeing a massive amount of trading and a lot of that trading takes place on Coinbase. They’re still one of the biggest next to Binance, and those earnings are going to explode. They blow out the numbers last time. They reported them ahead of time, which was smart before it went public, which I love that they did that. These numbers are going to be better than those numbers and those numbers blew them out. So, it will be interesting, Daniel, but yeah, it’s a good point that you brought up.
Frank Curzio: Well, the last thing I want to talk about is one of the guys that we follow, Dave Rosenberg, economist. I would say he’s kind of a permabear, would you say that or no? I always felt like he was a paranoid man for many years. He always thought the market was going to come down and I stopped following him. But he’s very, very smart when it comes to inflationary data and reporting data. But there’s a difference between being smart reporting data and understanding and making money off of it. There’s a massive, massive, massive difference between that. I think for me, David Tepper is the greatest in the world that does that. He could interpret data and know exactly how to make money. I see so many guys and economists interpret data and he was, based on the data, totally negative, negative, negative, negative on stocks for a very long time.
Daniel Creech: Just use it to kind of back up whatever argument you already had.
Frank Curzio: Yeah. Exactly. It’s like someone saying, Tesla is over valued at 200, which it was, 300, 400, 500, 600, 700. Yeah, you’re right. If you look at every metric it’s over value, but the stock is up 300% right in your face. So it’s, how do you make money off of that? I never got that from him, but he’s someone I follow and he’s coming out with a lot of good statistics saying that this inflation, and he’s agreeing with the Fed, that it’s going to be transitory. It’s going to be brief, this massive inflation. So, what are your thoughts on that?
Daniel Creech: Yeah, this piece jumped out at me. I thought this was fantastic. He wrote a piece with Macro Voices. Inflationary will be transitory. Then Zero Hedge, which is a wonderful libertarian financial website, ran it with a quote that says, “A whole bunch of people are really, really wrong about inflation.” And I’m paraphrasing here, of course, because Frank and I have been talking on the podcast a lot about inflation and to keep it simple, what he’s explaining is that it’s more of a pendulum swinging because of he expects more government policies to kind of negate or draw back.
Daniel Creech: So, what we’ve been talking about for several weeks and warning investors and also positioning portfolios to benefit from this higher prices across the board, is that when you inject money into the economy, when you put it just like the government is putting trillions, world governments around, but our government trillions and trillions of dollars into the hands of the consumers like us running around the economy, that causes prices to go up. Now on September 6th, Frank, what happens? The unemployment extra benefits supposedly run out from the government level. That’s a $300 a week bonus right now. Over 20 states, I believe, now are doing away with that. Mostly Republican, if not all Republican, to try to encourage people to go back to work.
Daniel Creech: So, what Rosenberg is saying is, “Hey, we’re getting a lot of statistics right now that are showing inflation, no doubt.” However, he thinks that because of dramatic increases in exports from Korea and Taiwan, which are critical sources for semiconductors, and he points to how container ships are, quote, filled to the brim and in holding patterns. So, think of airplanes, Frank. You know when you look out the window, and you’re circling your airport, and you see three other airplanes, everybody’s waiting in line. Well, picture that on the ocean because in LA and Long Beach, which are two of the busiest ports in our country, you have container ships filled to the brim, like he said. So, this whole supply crunch is happening right now. Is it going away tomorrow or next quarter? No, but he expects it. We’re getting spied on.
Frank Curzio: That was actually serious, I’m going to keep that. We really don’t edit these podcasts, but that’s an interesting question.
Daniel Creech: Hopefully, our ratings are going up the roof because we’re getting spied on. So, he expects basically the supply chains to kind of level out. As we get towards the end of the year, if the government does stop, now there’s a whole bunch of options that could happen because I personally think that you’re going to see headlines and arguments made in the government about extending those benefits or universal basic income or something to keep injecting money into the hands of the people. I don’t think that should happen, but I think that that’s going to be a conversation.
Daniel Creech: However, like Rosenberg points to, if you have reopening of the economies and you have less money going into the hands from the government, that short term will show a balance of inflation. I don’t think the Fed can control inflation. I know that they can’t, if you just pay attention to history. However, they can influence it over a short-term time period. Remember, Frank, we’ve talked about this a lot. What governments look at and view inflation as, and what the reality of inflation is, are two totally different things. So, if they can pull back adding money to the economy at the same time people are going back to work.
Daniel Creech: If you pull money out of the economy, what happens? If you quit giving people free money, demand is going to go down because they’re going to have less money to spend. That’s not rocket science. So, you pull some money out of the economy or stop putting money into the economy at the rate you are, you couple that with people going back to work and economies opening up, that could level off some of that. I think that’s a great point. What would happen? If the market gets wind of solid data like that, stocks could continue to move higher and higher to new all-time highs.
Frank Curzio: You know what? I’m just writing down a point here because I’m listening to you. For me, I always love listening to people who have a different opinion than me and here’s why. I respect, but here’s why he’s dead wrong. Okay. I’m going to make it simple for you. I felt like he’s been dead wrong for a while. Again, I love the statistics. I love what he’s saying because this is what he tweets, “It’s probably too much to expect the talking heads on TV to make a differentiation between a pandemic reopening price level adjustment and lasting inflation.” He says, “Treasuries are selling off in the FOMC minutes without realizing that since that meeting, we have seen duds in the payroll, retail sales, and housing data. Somehow, loss and inflation hype is a city economic surprise in the next 11-month lows.”
Frank Curzio: Okay. Even what you said, when you’re like, hey, you got to take this. You’re not going to pay people free money anymore. So, there’s less money going into the markets, it’s not putting money into the market. Okay. Why is that stopping? You’re just talking about one small facet of the market where, okay, you’re not going to pay these people anymore. Big deal. You know what? They’re going to go back to work, and how are they going back to work? All these companies are paying them incentives and raising their pay. So, that’s more money that’s going to be made in their pocket and that they’re going to spend. You’re talking about the supply issues are going to go away. They’re not going to go away to 2022 at least. The reason why we have that massive imbalance is because there’s not enough goods in the market.
Frank Curzio: Everybody wants to buy stuff. So, you’re looking at retail sales. Why was it a dud? Go to Best Buy. There’s nothing on the shelves. People aren’t buying anything because there’s nothing there. I would have bought a car last month when I started looking. I couldn’t buy a car. Now, I have to get a used car shipped in here. Then, I’ve got to go pick it up in a couple of days. People are trying to buy and they can’t. So, you’re looking at why the home value, well, home values are going through the roof still, up tremendously. I think they’re up like 17% year over year, which is insane. But why is that number in the latest housing data? Because housing prices are going higher and higher and higher and higher and higher. They keep going higher.
Frank Curzio: So, of course, you’re seeing a little demand come off the market just a little bit, but it’s still pretty high. But when I look at what he’s saying, where he says, less money going into the market. I can’t see that argument. I mean, there’s more money going into the market as long as interest rates stay low, which the Fed said they’re going to do. They’re going to continue to buy bonds. So, that money stays into the market. The money he’s talking about where, “Oh, well, we’re getting rid of unemployment benefits,” that’s going to force these people to go back to work. They’re going to be making a lot of money going back to work, more money than they made when they didn’t.
Daniel Creech: In a lot of cases, yeah.
Frank Curzio: In a lot, a lot of cases, because you’re seeing a massive labor shortage and then what’s going to happen? I mean, you’re looking at people trying to buy. They’re still trying to buy stuff, but they can’t buy stuff because it’s three months, six months, nine months. I ordered a mattress. I need a mattress. I have the worst mattress ever. I ordered it a month and a half ago. They said it’s going to take two months. I just emailed them and said, “Hey, could you give me an update because I ordered a Peloton. It took like three months.” But every week they were like, “Hey, this is what’s going on.” They let me know. They haven’t even answered my email, nothing. I’m like, I bought a really good bed because I need it because I have back problems. This bed is terrible, but we’re still waiting for it, and nothing.
Frank Curzio: So, this is not going away anytime soon and to think, well, hey, money’s coming out of the market now. Wait, the unemployment rate went higher. It went higher because people are home right now. They’re getting paid more money than to work, but what’s going to happen? You’re going to remove those benefits. Now, they’re going to go back to work and they’re going to make higher wages than they did when they were working. It’s definitely going to be everybody is raising prices tremendously across the board. Every company, guys. I track this stuff. If you look at any sales, listen to any conference call, every McDonald’s, Chipotle, everybody. Coca Cola. Everybody’s raising prices. You know it, you see it everywhere.
Frank Curzio: So, the fact that people think this is going to be transitory, I don’t get it. I don’t buy that argument. I’m sorry. I mean, look, he’s brilliant. He’s a brilliant economist. I love seeing the other side or different opinion. He could end up being right. If he’s right, this market is going to soar because you got all this money coming into the market, people are more richer today than they’ve ever been. People are going to spend money on goods. Yes. I know there’s a massive gap, but we’re talking about the people who spend money here. This is about the economy. You’re going to see more and more people buying stuff. You’re seeing it right now.
Frank Curzio: They’re buying houses and buying everything. You’re seeing bars crowded. Everything is crowded. People are spending money. That is not going away anytime soon. The fact that the fed is like, “Hey, you know what? Unemployment rate went up,” which is a surprise. So, you know what? Since that’s our mandate now, it’s not inflation anymore. We’re well above their inflation target. It’s getting that unemployment rate to pre COVID levels. When I look at that, that’s not happening. That’s not happening. It’s not going to happen. There’s just too many people at home, too many people that even got the taste of staying home, they’re doing other jobs from home. You’re not going to get that unemployment rate back down to three and a half, whatever, 3.7%, whatever it was.
Frank Curzio: So, when I look at his argument, yes, I’m expecting retail sales to be a dud because you can’t buy anything right now. It’s very difficult to buy stuff. Housing data, of course, you’re seeing home prices go higher and higher and higher. You’re saying, well, that’s going to result in the slow down. Is it? Because if interest rates stay low, what you’re saying, they’re probably going to stay low and they’re still kind of low. Mortgage rates are low. You’re going to continue to see people buying homes and assets. I mean, you’re still seeing assets across the board go higher, even in stocks. Now, they’re coming back.
Frank Curzio: So, yeah. He’s talking about the payroll again, all those arguments, I just don’t see. Could I be wrong? Absolutely. He could be right. This could be transitory. I just don’t buy that argument. I’ll be honest with you. I hope he’s right, Daniel. Because if he’s right, people are going to make an absolute fortune, especially in their portfolios, especially in the market. You’re going to see technology companies bounce back tremendously. You’re going to see profits surge. It means that all this pricing power was easily passed off. These companies are going to generate profits beyond belief, even though we have tax cuts coming up for corporate taxes. But if he is right and it’s transitory, and it’s going to be brief. I don’t know what brief is by the way. I wish he defined it because this year, forget it.
Frank Curzio: Prices are going to go through the roof this year. I mean the supply chain and ship shortage is not going away anytime soon. I just, again, I don’t buy it. I hope he’s right because if he’s not right, we’re going to be in a recession next year. We’re going to be forced to raise rates if we see inflation go out of control. Right now, that’s a very real possibility the way interest rates are and the fact that the Fed’s not taking their foot off the pedal. That’s just my opinion. I could be wrong. Again, I hope I’m wrong because it’s going to hurt a lot of people if I’m right.
Daniel Creech: I mean, the big takeaway here is it all comes down to timing and perception. So, I agree with both of you guys. What you’re saying, people are going to go back to work.
Frank Curzio: You can’t do that. You’ve got to agree with one or the other. Never be on the fence.
Daniel Creech: The easy answer is, you don’t have to take a stance here because I mean, the easy answer is be diversified. So, if you’re diversified, you’re fine. You’re going to have some things bounce around. I don’t need to take a side because you don’t want to load up, I don’t think you should anyway and I’m not going to, load up on one side or the other. Timing and perception because to your point, people go on unemployment benefits have to go out back to work. Let’s say they’re making more money. That doesn’t happen overnight. So, if that takes a quarter or two quarters to kind of get into place, that’s going to reflect in those statistics.
Daniel Creech: That’s my point. So as long as the government’s looking at stats, and Rick Santelli made a great point a couple of weeks ago, once you get to that year over year point if it’s not outrageous, then you really have to pay attention because the new normal for us as consumers in reality, our prices are going higher, no doubt. But if that doesn’t change the dynamic of the fed actions, that’s completely different than what could happen in the stock market prices. To point to a realistic thing on that, Cracker Barrel, Frank, do you like Cracker Barrel?
Frank Curzio: Yes.
Daniel Creech: I really like Cracker Barrel.
Frank Curzio: Sometimes I like Cracker Barrel.
Daniel Creech: Get off the fence. What do you mean sometimes? You either like it or you don’t.
Frank Curzio: You know why I don’t like it? Because I’m getting in very, very good shape now.
Daniel Creech: Don’t get healthy on me.
Frank Curzio: You can see just by looking around that crowd who eats there and it’s good and you get big portions and it is nice, that’s why.
Daniel Creech: Moderation, my friend. Just because other people may or may not do it that means-
Frank Curzio: How could you eat one pancake if you go there for breakfast?
Daniel Creech: You eat one stack.
Frank Curzio: One stack?
Daniel Creech: You don’t do it every day. Anyway. They’re delicious. Their biscuits are good too. Their coffee’s good.
Frank Curzio: I know, they do have good biscuits. Yeah.
Daniel Creech: Anyway, I like it. I like the atmosphere. I’m not a knick-knack. I don’t buy all the crap, but it’s fun to look around and see what that kind of stuff is. Back to this. A, they’re a strong brand. So, you always ought to follow their earnings. The big takeaway here is they saw 2.8% step up in prices in Q3. They expect 5% more increases in commodity in Q4 due to pork. Pork prices, moving higher. They, Cracker Barrel, are going to increase prices by another 3% in Q4.
Daniel Creech: The bump will not be enough to offset rising prices. So yes, they have pricing power, but they’re not going to raise prices so much to offset all of theirs. So, you have to look at margins, they can cut costs everywhere else. To your point, Cracker Barrel has already raised prices. They’re going to raise prices again in Q4 by 3%. Let’s say everybody’s right, and you get these year over year, or these inflations that look temporary. Is Cracker Barrel going to lower prices by 3% Q1 or Q2 of next year?
Frank Curzio: No. They never lower prices.
Daniel Creech: Very rarely. So, that’s the reality. That’s what the toughest part is. You’re going to look at data that’s going to scream inflation, reality is, but how’s that going to dictate the stock price and all that kind of stuff? So, that’s something to take away. I hope that that helps and kind of backs up our points, not makes us look like we’re on the fence. But that’s just the reality of real public private companies, publicly traded companies, out there working versus the, quote unquote, smartest guys in the rooms that are looking at data.
Frank Curzio: Yeah. I’m a big fan of David Rosenberg, even though I disagree with him on this particular issue. I think he’s kind of contradicting himself also because I know that he was bearish and he’s an economist, but he was bearish on the overall markets for a while, at least from when I was reading him and stuff for a while. But you can’t be bearish on the markets and say that inflation is transitory because if it’s not, you’re going to see growth stocks. You’re going to get the market very expensive again. It’s expensive now, but it’s even going to get more expensive as growth stocks come into favor again. But he’s also talking about how that is a rotation of value into growth, which we’re seeing. So, if we’re not seeing inflation you really think is transitory, I mean, maybe people are just trading it this way, but I mean, look at reopen stocks.
Frank Curzio: I mean, those stocks are still going through the roof. The cyclical names. Those do well during inflationary times, especially during the early stages. Materials, commodity is still going through the roof. That tells me it’s an inflationary environment. The fact he thinks it’s transitory, maybe people will just be trading it for a couple of months. But if that’s his thesis, he should be telling everyone to buy the FAANG stocks, technology stocks, and growth stocks, hand over fist right now, if he really believes it’s transitory. I would love to debate him on that and talk to him because I’m sure he’ll educate me on some things. He’s a brilliant guy and I respect him a lot, but yeah.
Frank Curzio: I think it would be a healthy debate. The bottom line is it gets to the truth. Whatever happens, we come back and talk about and say, “Hey, you know what? I was wrong here. I was wrong here. He was wrong. He was right.” That’s how we get smarter. That’s how we get better. I would love to get him on a podcast. I’ll reach out to him. I do follow him. I think you should follow him also on Twitter because he does provide really, really good information and good statistics, which are not that easy to find these days. So Daniel, wow. That took a little bit longer than expected. I mean, we went crazy.
Daniel Creech: We went real long. We need to wrap this up. Sorry, Garrett.
Frank Curzio: All right, man. So, let’s see here. Yeah. I know. The guy that tapes this is probably like, “Come on, come on. I’m on a clock here.” The behind the scenes, Garrett, who’s awesome. Who does all this stuff and makes it look great, and the guy behind the scenes. So anyway, Daniel, thank you so much for coming on again. Appreciate it. Love having you again. Great feedback from it and that we could cover these topics and stuff. So, I really appreciate it, buddy.
Daniel Creech: All right. Cheers, everyone.
Frank Curzio: All right, guys. That’s it for me. So, I will be sending you that thing from Marin. If you’re interested, that’s fine. But again, I’m putting a lot of money into it. It’s something I believe in. That’s what a Curzio One membership is about where I’m sharing a lot of these small deals, we don’t get huge deals, that I get from very good sources that you can get into through Curzio One. We’ve gotten into three of those deals already, which is really cool.
Frank Curzio: But when I say deals, I think they have favorable risk-rewards for people that are looking to take on risk. I pass it on to you. I don’t do it often, but I really like this deal. I like what Marin’s doing with this stuff. Plus, I really love the sector he’s investing in because it is going to go through the absolute roof of Carbon Credits. No matter what you think about it, believe in it or whatever, that industry is here. It’s going to be enormous. This is one of the ways to play it, which is really, really cool. So, I’ll send the email out to you by tomorrow. If you’re interested, if not, no worries.
Frank Curzio: But that’s it for me. That’s it for Daniel. Thank you so much for listening. Enjoy the long weekend, Memorial Day, have a lot of fun with your family’s barbecue. We always say this, don’t talk politics. Just have a good time. Enjoy it. It’s really, really cool. I’m glad that everything’s opened up and you’re probably not going to have to wear a mask if you live probably in about 80% of places in America. Go have fun. Have a great time. 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.