Earnings season is well underway… Netflix just reported solid earnings and continues to gain subscribers. Daniel and I discuss the streaming giant’s new hit show, Squid Game, and how the company continues to be the king of great content. [2:00]
United Airlines also reported a strong quarter… and foresees a coming bottom to COVID impacts. This is great news as travel returns to pre-pandemic levels. [8:40]
In other airline news, Southwest decided to back off vaccine mandates. Daniel explains why this issue goes beyond airlines… and how mandates can hurt local economies. [10:40]
Facebook has chosen Coinbase to roll out its crypto wallet, Novi. Daniel shares why he’s bullish on the social media giant despite not being a fan of its services. [22:05]
Bitcoin hit a fresh all-time high today. The news comes on the heels of the launch of the ProShares Bitcoin Strategy ETF (BITO), which began trading this week. I explain why I expect the momentum to continue—and whether you should buy BITO. [25:45]
Next, I break down some data on why supply chain issues will continue to cause stress across the economy—particularly in one sector. [29:58]
I also share some quick thoughts on Procter & Gamble’s strong earnings. [33:55]
And finally, there’s never been a better time to get into the crypto space. And with the special offer we just released TODAY for my Crypto Intelligence advisory… you can lock in a free crypto pick. [35:16]
- How Netflix continues to be the king of great content [2:00]
- Why United sees a coming bottom to COVID impacts [8:40]
- How vaccine mandates can hurt local economies [10:40]
- Why Daniel is bullish on Facebook [22:05]
- Should you buy this crypto ETF? [25:45]
- Why supply chain stress will continue across sectors [29:58]
- A look at Procter & Gamble’s strong earnings [33:55]
- Crypto Intelligence special offer: Lock in a free crypto pick [35:16]
Wall Street Unplugged | 809
The flood gates are about to open for crypto
Announcer: Wall Street Unplugged looks beyond the regular headlines heard on mainstream financial media to bring you unscripted interviews and breaking commentary direct from Wall Street, right to you on Main Street.
Frank Curzio: What’s going out there? It’s October 20th. I’m Frank Curzio, host of the Wall Street Unplugged podcast where I break down the headlines and tell you what’s really moving these markets. Dan, ever since we went to this new format, three days a week… One day a week was cool when I had that, “Hey,” and stuff, but when you do it three days, I feel like I do it every day now.
Daniel Creech: Well, you do.
Frank Curzio: I know. I don’t know. I have to come up with a different opening. I don’t know. Got to ask the audience what I should do with that.
Daniel Creech: There you go. Send in your ideas.
Frank Curzio: Just feel like I’m saying it two or three times a day. I’m not, but every time. It used to be once a week, and now, it’s like, “Whoa, we got to get pumped up for that.” I don’t know how Ellen and all those people do it. Jimmy Fallon, go on their show and be happy all the time and be excited all the time. What’s your outlet? That’s why when they were saying Ellen’s yelling at people and screaming. What do you expect? She’s got to be nice all the… There’s got to be an outlet for everybody. There’s got to be a vice, or you’re just going to explode. I’ve seen it so many times. Anyway.
Daniel Creech: It’s like a one-hit wonder. You’re going to get sick of playing the same song. Is that what you’re saying? You’re going to have to change it up a little bit?
Frank Curzio: Yeah.
Daniel Creech: You’re tired of being that hit or something?
Frank Curzio: Yeah, exactly, exactly. So, Daniel Creech here, obviously, senior… What are you again? Senior research analyst or something here?
Daniel Creech: I’m many things, Frank. Thank you very much.
Frank Curzio: You’re a lot of things. Dan’s been coming in, he left the office really late yesterday, and came in very, very early today. And I felt like being the guy from Succession and being like, “All right. Whatever you’re thinking of or whatever you want, it’s not happening.” He even said that to me as well. I thought it was so funny when-
Daniel Creech: Frank either thinks I’m asking for a raise or I’m about to tell him I screwed something up really big. It’s kind of somewhere in the middle, all right.
Frank Curzio: Yeah. I’m not used to that. Anyway, a lot to talk about. Let’s start with earnings. A lot of earnings coming out. You’re going to see some in the next couple weeks. I don’t know. Daniel, I’ll let you start. What do you want to start with?
Daniel Creech: Well, I’ll tee one up here for you, only because you already brought up Succession, which I’ve only seen one episode of that, and it was good. Frank talked about that in his monologue the other day. Interesting, entertaining. I get that. But since you brought up a show, let’s talk about another one. What is this Squid Game here, Frank? Have you seen this?
Frank Curzio: Yes.
Daniel Creech: Because Netflix reported solid earnings. I’m assuming that, I didn’t really go through it. This is Frank’s ballpark. He loves Netflix and has segued into his drinking game favorite company that we’ll talk about in a minute.
Frank Curzio: You see why Netflix is the king, right? You see why Netflix is the king. The numbers are good. Hey, I wouldn’t say they were doing fantastically great. Asia Pacific’s on fire. That’s a growth model for Netflix going forward. Subscribers used to be the KPI, right, key performance indicator. That was like every stock has something you want to look at, and it’s not always earnings that’s going to drive the stock, it’s not always sales. Sometimes, it is subscribers, sometimes average revenue per user, which no one cares about average revenue per user or Disney would’ve crashed already, because Disney’s at 450, 475, and Netflix is more than double, triple that, which tells you it has pricing power, tells you there’s lot of free people on Disney’s platform, which are starting to come off, and that’s why you started downgrading and slower growth. And now, they’re realizing that streaming, which I’ve said for freaking many, many times, many years, it’s one of the hardest businesses to be in. Just the cost to constantly come out with new content, and that’s what it’s about. Right? Squid Game came out. I’m up to episode seven.
Daniel Creech: Out of how many? Is this thing brand new? Is it… Okay.
Frank Curzio: No. It’s nine for the first season. But what Netflix does, it allows you to watch all night at the same time, back to back to back to back. Even some streaming services, still, they’re like,” Here, whatever’s streaming,” and then, next week you come out, you got to wait next week. It’s not like SVU or one of these shows on television. So, you get to watch the whole thing and you binge watch it. But they said, this number is just like insane, 142 million member households, 142 million member households globally have chosen to watch this show in its first four weeks.
Frank Curzio: Now, that number, if you look at Facebook and say, “Well, they’ve got 2 billion this and that.” Whatever. How many active, real true active users? It’s lower than that, but a hundred… I’m going to put that in perspective. There’s only 123 million households in the US, right? So, 142 million in four weeks, and it’s entertaining. I don’t want to just go out there and say it’s great, because I went in with low expectations, and I like it, but I know some people say, “Eh, it’s not that good.” I thought it was good. It’s violent, it’s original. You’ve read these stories in books, now made into two movies. Hunger Games maybe, but not really. But really, it’s cool. It’s a great show. It’s entertaining as hell. I like it a lot.
Frank Curzio: But it just goes to show you how important it is when it comes to new content. But getting back to that KPI and subscribers, subscribers used to be, that’s the number that everybody wanted to see, and that’s why Disney was smart. “Let’s partner with Verizon. Everybody gets the service for free.” And I have Verizon, I have a family plan, I call there, I said, “Hey, I’m going to get it for a year.” “No, you have it for life for free.” Because those subscriber numbers were driving the stock during a time, maybe the worst period maybe in Disney’s, I wouldn’t say history, but pretty close to that in the last 30 years, because COVID affected this company, impacted this company more than any other company, major company. You can even say more than the airlines. The airlines are coming back right now, but Disney does not have this recurring revenue stream, which means that they had to find ways.
Frank Curzio: Their earnings, they’re one of the few companies in the DOW, and I bet you Boeing, I don’t know if they did already, but Boeing’s probably going to reinstate their dividend. They’re one of the few companies that didn’t reinstate dividend, because they can’t. They can’t pay it, right? The expenses that they have are incredible. They can’t afford to keep up with Time Warner, AT&T, which has recurring revenue, and they’re starting to really build that platform internationally. They can’t keep up with Netflix. These guys are spending $20 billion a year. Disney’s not. It’s new content, and their new content consists of Marvel, and they can’t stream that. They already got in trouble. Someone almost sued them, because they wanted to stream it. That’s their biggest generator, from the movies, and the movies doing great, but those Marvel titles generate $1 billion plus in the movies, not in streaming, so they’re caught in a really bad place right now, because all these subscribers that are in for free are starting to dump off. They don’t have pricing power.
Frank Curzio: You see something like this when Netflix come out. You see Succession come out, HBO and streaming. So when I see this and what Netflix is doing, it’s really incredible, but just 142 million member households. You’re looking at 400, 500 million people watching this thing, maybe more, when it comes to households. They’re building a gaming platform as well, which is going to be included in subscriptions and everything and not going to have advertisements or anything. They’re going to get more people on that platform, and they have incredible pricing power. They’re the king of this market.
Frank Curzio: Subscribers, it’s a saturated market, everybody has streaming. I don’t think subscribers is going to be the number looking forward. It has to be the number for Disney, because they just don’t have the revenue or the earnings. Their earnings are still not going to get back to pre-COVID levels probably for another two years, which is insane. A lot of companies are reporting numbers back to those levels or even higher than 2019 pre-COVID levels. It just shows the big disconnect where… Disney’s not second here. Time Warner is now, AT&T, and that platform, the HBO. But Disney here, I don’t know what they’re going to do. I have nothing against Disney. I go there to take my kids. I like them.
Frank Curzio: From a stock perspective, their biggest growth market, Daniel, is streaming. That’s what they based their whole company on. They went all in on streaming, and you’re seeing much, much slower growth. Yet, that stock is trading at 40 times forward earnings. Why in the hell would you pay 40 times forward earnings for a stock that’s going to show significantly slower growth going forward, but who knows? Again, sometimes the numbers don’t matter. With this report from Netflix, it just shows how they’re the clear leader. Nobody’s even close to them, and AT&T, Time Warner, they’re second. Disney is falling, and it’s going to be interesting to see what they do to really… How are they going to back out of this? Or say, “Hey, well, we’re not going all in. It’s just going to be part of our platform,” but they’re stuck between a rock and hard place right now. It should be interesting over the next few months to see what they announce.
Daniel Creech: Yeah, Disney’s down, what? From $200 a share in March-ish to $170 right now, so it’s definitely pulled back. AT&T reports tomorrow, I believe, so that’ll be interesting to see some comments that they have on their streaming gaining market share, all that kind of thing.
Frank Curzio: And that’s stock’s been falling off. That’s one of our ones in our portfolio, down about 9% on it. It hasn’t been good. For me, I think, and I’m not saying this way early and you’re wrong, but I just think the separation and what they did with their platforms of separating new business and discovery is a fantastic, fantastic thing. They provided tremendous value. It’s going to take a while to get the approvals. And now, you’re sitting here as a shareholder going, “Eh, dividend’s going to be a little bit less.” But still, when they come out with their numbers, I’m expecting them to be pretty good, but the streaming numbers should be even great, because they have a lot of great new content that’s coming out and that they just launched as well, which you should see that when they report streaming results.
Daniel Creech: Yeah. Sticking with earnings, you made a great, you told me a solid bullet point from United that reported earlier, and I want to use that to talk about Southwest and a big win for society in general. So, the bullet there was-
Frank Curzio: Lots of bullets. United CEO was on CNBC. He said pullback in demand has definitely bottomed out and demand is improving.
Daniel Creech: Those are strong words. That’s great to hear.
Frank Curzio: These guys didn’t fudge their numbers. They told you when things are really bad, right? So, holiday international demand is strong. It means business travel will start to return again. In January, European bookings are up versus 2019. That’s a huge surprise to me. They say 99.7% employees are vaccinated, which we’ll get into the Southwest thing. Air travel remains a great bargain. Airplanes will be full for the holidays. Demands were posted strong. Again, buying the airlines here, they’re trading significantly off their COVID highs. These guys have incredible pricing power. Everybody’s going to need to travel, everything is going to open up. It could take three months, six months, nine months, a year from now when everything opens up internationally.
Frank Curzio: These guys are going to be, they were reporting record profits before this happened. Now, they’re leaner than ever, and wait until you see with the prices, you guys know if you’re traveling, the price that they’re charging. Profits are going to explode for these guys. It could take a little bit longer. Buying at these levels, maybe you have 10% risk here, and I think you have easy 50+% upside. So, let’s get to your South-
Daniel Creech: Well, real quick, just from a macro standpoint, we talked about this with Delta earnings. They had positive comments on bookings picking up. Not quite back to pre-COVID levels on travel and business and all that where their high margins are, but hell, for lack of a better word, from a human being standpoint, from a society standpoint, it’s good to hear these major corporations say that bookings have bottomed, that people are getting back out. Unless Fauci and everybody else tries to cancel Christmas this year, people are getting fed up and want to return to life, and I don’t even want to use the term life as normal or life before COVID, because that’s kind of conceding the fact that you’re willing to change and you’ve already given in. So, don’t talk like that, people. Keep your head on your shoulders and keep moving forward. The Southwest thing is even better.
Frank Curzio: I can’t wait. I’m teeing up for you, because this is… Go ahead.
Daniel Creech: Well, because we talk about the problems that Southwest had more than any other airline. They blamed the weather, of course, which is easy, and they were saying that it wasn’t the pilot strike that was causing a lot of the cancellations. It was more weather and maybe some technical problems, what have you.
Frank Curzio: A lie, yep.
Daniel Creech: But CNBC reported, I believe it was yesterday, that they’re basically, Frank, backing off of the mandatory vaccine mandates. They’re not going to fire, they’re not going to lay off people by a certain date. They’re just stepping back, which is ironic and funny, because they’re out of Texas. Texas just signed a, we talked about that, executive order banning the mandating of a vaccine requirement. However, this is just good news because it shows that hey, enough people united, stood up against it. I hate for people to lose their jobs, but if I had a hat on, I’d tip it to them for everybody that stood together and was willing to lose.
Daniel Creech: Think of the stress that you have a… I don’t have anybody else to be dependent on me, but if you’re married and have children, and you’re working your ass off, and you need a paycheck just to keep the wolf away, as my late grandfather would say, because you got rising prices everywhere, the ability to say, “Hey, I’m willing to get fired or go without pay for a choice,” that’s amazing, and that needs to be rewarded. So, to see this, I hope other companies follow suit. I hope governments, governors, state legislators follow suit and either back off the mandatory requirement or at least start fighting for the individuals that have a choice and want to voice that. There’s nothing wrong with saying that, people. So yeah, this is great on Southwest, and Frank interrupt me here, but I want to talk to why it’s more important than just airlines too.
Frank Curzio: Well, Southwest, you know why they did that, right? They reversed. They did it because they had to. They don’t have a choice. And this is going to set up for something that’s very interesting in the months ahead as we mandate. I’m a good example of this where I was forced to get the vaccine. I was forced, which is frustrating. So now, I’m forced to get, even though I had COVID, I didn’t want to get it. I got it because I have to, because I’m going to travel. So, that’s me. When it comes to your pilots, you saw how many flights got canceled, right? So, this is their union, the Southwest Airlines Pilots Association, they came out and said the new vaccine mandate unlawfully imposes new conditions of employment, new policy terms of termination of every pilot not fully vaccinated by December 8th. They lose the pilots, they lose the company. Pilots have… The amount of-
Daniel Creech: You’re saying said pilots are important to flying, that’s an integral piece of the puzzle?
Frank Curzio: A little bit, yeah, a little bit. Yeah, a little bit.
Daniel Creech: Okay.
Frank Curzio: But think about flying, right? It’s a necessity. You can’t travel. If you cannot travel, it would destroy economies every place if you can’t travel, right? So, pilots have incredible power. If they walk off, holy shit. And we saw the cancellations, right? It’s not where they’re like, “Weather in Florida.” We live in Florida. Weather’s pretty good. We go golfing and stuff some afternoons, and weather was good here. That was bullshit. But getting to a bigger point is how do they enforce these mandates? How do they do it? Because I think when you’re looking at different organizations and unions, they have incredible power.
Frank Curzio: The Chicago Police Department say the same thing, “We’re going to lose a lot of our workforce. Imagine if there’s no cops,” which a lot of people want that want to destroy America. But most people, you need the police, you need them there, you need that safety. And they’re saying that a lot of people aren’t going to show up to work, but I think people in general, this is like going to be a revolution. It really is, because there’s people that are just like, “I’m not getting the vaccine. I don’t care what you say.” And it’s not a big deal if you’re a coach of a team that got fired or Kyrie Irving’s not playing or whatever for the Nets right now. But when you’re looking at pilots, when you’re looking at police officers, when you’re looking at nurses, now, holy shit, right? Now, you’re seeing businesses going to be impacted as well.
Frank Curzio: And it’s frustrating, because again, I was forced to get vaccinated, and now I’m poking around the CDS site, because I plan to go there. And now, they’re saying that I’m going to have to wear a fricking big thing on my neck, my vaccination card, “I’m vaccinated,” and they don’t let you in unvaccinated. I’ve got to show everyone I’m vaccinated, here you go. Now, I have to wear a mask as well. Why the fuck do I have to wear a mask if I’m vaccinated? So, that’s what pisses me off now. Now I’m like, “Okay, so now I got to wear a mask.” And I go there four or five days, the whole entire time, that’s what is in Vegas, most of the casinos and even the conferences.
Frank Curzio: But remember when getting the vaccine, Daniel, meant that, “Hey, once you get the vaccine, you’re not going to get COVID. You’re going to be fine. You won’t have to wear masks.” That was the pitch, that was the pitch. Now, we know that these vaccines don’t work in regards to what they originally said they were going to do, protect you from getting COVID again. Now it’s like, “Hey, no, no, no, no. But those vaccines are protecting you. They’re reducing your risk. If you get Delta of dying,” that’s not what you told us, though.
Daniel Creech: No.
Frank Curzio: So, no 95%, 96%, 94% efficacy means I’m good. I get this. I’m good. Now it’s booster shots everywhere. But you see in countries based on population of vaccinated, the highest is Israel and the UK, right? So, I think they have something like 80%, 90% of their population vaccinated. Delta is spreading like wildfire. In the UK, I think it’s just beginning to back off, but it’s 80% of the people in the UK over 12 are vaccinated with both doses, and they’re recording 50,000 cases per day, meaning that the people who have vaccinated are the ones that are getting Delta. And you could see with studies of Israel where it’s 6X, 7X likely that when it comes to getting a Delta virus that you’ll get it if you never got COVID before and got vaccinated compared to if you had COVID before, because those antibodies are still working.
Frank Curzio: They don’t want to come up with a study here in the US, obviously. It’s very easy to see those results. But then you look at Israel, closer to 90% vaccinated, tons of boosters, and it was 11,000 cases per day. This is about three to four weeks ago. Now, it’s below 2000, but Delta is spreading like a wildfire. Again, slowing down in these areas finally, thank God, but they just completely lied to us. So now, you’re saying you got to mandate something that you lied to us about. And I’m not saying it doesn’t protect you if you get it again. You guys know I know all the fricking statistics. I’ve been deep in this for over a year, a year-and-a-half, one of early people talking about this and interviewing people, but just the whole bullshit behind this, Daniel, is very frustrating. We’ve been lied to. Just tell us the truth.
Frank Curzio: And now, it’s like, “Hey, we’re going to force you to wear masks. You got to get a booster. We’re going to mandate that you get this, or we’re going to take away your freedoms. We’re not going to let you go indoors or places to see different things or go on planes.” Now, you have these people fighting back. Something’s got to give, because when it comes to the pilots, you have no choice. Southwest has no choice. You lose your business if they walk off. You’re gone. No one’s going to fly Southwest, and there’s other options. But when you have something like that with pilots, police, nurses that are like, “Hey, I’m not freaking doing this,” how are you going to mandate it? How are you going to enforce this? And that’s going to be interesting coming up, which is like a December 8th deadline I think that Biden’s going crazy with mandates, whatever.
Daniel Creech: Yeah. Real quick on your point, I’m not accusing you of this, but everybody needs to take this with a grain of salt, because yes, of course they lied, because it’s more about control and everything else. Now, are you going to take your booster in six, seven, eight months or whatever? And are you on the hook to take them forever? Because that’s what the pharmaceuticals are lining up to do.
Daniel Creech: So, that’s how it affects everybody in their lives, and the way this affects the economy, more so than just Frank talked about police officers and different things. San Francisco, I think, there was something like 3.5% of police officers are unvaccinated, so what if they get cut? That’s a decent sized chunk to a police force. Walgreens is already either moving out of San Francisco or closing stores early because of not only requirements, but also if you’re allowed to steal damn near a thousand dollars and not get in trouble, what’s going to keep people from walking in and stealing stuff? And then, Frank, are you an In-N-Out burger fan?
Frank Curzio: No, I’m not an In-N-Out burger fan, only because I haven’t been to a lot of In-N-Out burgers, so I was thinking-
Daniel Creech: Okay. Have you ever had it, though?
Frank Curzio: I think I had it once or twice.
Daniel Creech: All right. I like it. There’s a cool thing, and there’s this whole underground world thing with… There are several out in Arizona when I’m was out there, and I had it a handful of times, but there’s this underground menu. You go there and you can order stuff if you know the certain language, and different places do that. That was kind of fun. My experience with it, real quick, I had a t-shirt from In-N-Out my uncle got me. I had never been there. Every time I wore this t-shirt, people would stop me and say, “Oh, isn’t that so great? Have you had… What’s your favorite?” I’m like, “What? Oh, yeah, I’ve never been there.” I started having to lie to people, and I don’t like to lie. They’d be like, “Oh, man, isn’t that a great burger?” “Oh, hell, yeah, man. Get the number two or get the number three.” I’d change it up every once in a while.
Daniel Creech: But it is good. However, their chief legal and business officer, Arnie Wensinger, was explaining how San Francisco Department of Health closed one of the top California burger chain restaurants. Why? Because the employees at In-N-Out burger failed to basically frisk, rob, stop, and ask customers for proof of driver’s license, vaccination cards, etc., etc. And I love this quote by this chief legal guy, he says, “We refuse to become the vaccination police for any government. It is unreasonable, invasive, and unsafe to force our restaurant associates to segregate customers.”
Daniel Creech: That is exactly how this trickles down into everyday ordinary life in the economy. The economy is the most important thing from a society standpoint in a lot of regards, because it gives people the opportunity to continue to better themselves. You start taking away businesses out of economies, you start taking away police enforcement, and you get more and more chaos, and it’s really hard not to make the argument that that’s exactly what the powers would be want based on their actions like this. If you think that In-N-Out burger employees need to ask if you want fries with that, plus your driver’s license and proof of vaccination and be the police enforcement, you’re as crazy as the people at the top right now.
Frank Curzio: Yeah. And guys, we’re talking about this and everyone has their own opinions, probably depending on what political party you’re a part of, but this impacts stocks. Southwest took a nice 10%, 15% dive on this since October, so it’s going to impact certain businesses. But it will be interesting to see going forward how you’re going to mandate this one. You could do it to regular people and stuff, and people going to conferences, but when it comes to some of these groups that have incredible power where they have the power to shut down a business if they don’t show up to work, all because they don’t want to get vaccinated, maybe they had COVID, maybe they had their own reasons.
Frank Curzio: Again, a lot of these people are saying, “We’re not anti-VAX,” and I feel like you have to say that all the time if you don’t want to get the shot. “I’m not anti-VAX.” That’s what everybody has to say, has to say. It’s almost as if you’re talking about racial relations, you’re like, “Hey,” and you have to admit that you have a black friend or something right before you talk about it just to be politically correct.
Frank Curzio: But a lot of this factors in down to stocks. It did factor into Southwest. We’ll see how it goes forward, but if Southwest still has problems with this or delayed flights or pilots walk off, it doesn’t look like it’s going to happen anymore. But look for the other airlines to really benefit tremendously, because if I’m booking something, I go through Expedia or wherever and Southwest isn’t there, I’m going to fly Delta, United, American or whatever, I’m going to fly something else, and other companies are going to benefit.
Frank Curzio: So keep an eye on this, because this is a big pushback, this is a very big story. You’re going to see more and more groups push back, and some of them nobody cares about, others impact the economy, impact a lot of people, money flowing into the system. And it is an interesting trend that you should follow, because there are going to be a lot of stocks that get impacted by that. Now, let’s go into Facebook. I have too much subjects, real quick. I wanted to talk about Facebook, which is your favorite company in the world, Daniel, I think.
Daniel Creech: Yeah. To recommend. It makes me look like a genius.
Frank Curzio: That’s another thing, right? Whenever you say Facebook, you’re like, “Oh, I hate the company, but buy the stock.” Everybody says that, right?
Daniel Creech: Well, I don’t know about everybody, but I’ve been on that beat for a while, because I don’t even use it. I’m not a big fan of Zuckerberg. I don’t believe in his one-world vision control and all that kind of stuff. However, in the world of reality investing, it is a great risk/reward setup. It is connected with the highest, most goofy people in governments. I don’t need to rehash this and beat this dead horse, because I’ve already said that enough. But it’s pulled back. It was down about 15% from its previous highs of $380. If you haven’t, I would add that. As long as you can put your conscience aside, Frank, this makes Goldman Sachs look like the nicest, most welcoming people in the woods when you’re stranded and trying to get through. It’s like a Game of Thrones thing. When you’re hungry and dying, they come to your rescue, and that ain’t reality either. That’s how good Facebook is.
Frank Curzio: Yeah. It’s down about 12% from its highs. Again, there’s a lot of news, though, that came out in the past few days, actually. So, they’re changing their name?
Daniel Creech: Well, that’s a rumor. They’re probably going to change the holding company name. Yeah. We’ll see if-
Frank Curzio: To reflect, as I said, reflecting more of building the metaverse, which is merging, augmented reality and virtual reality, which is unbelievable. This is a massive, massive, massive trend, especially when you look at Facebook, whatever it is, 20% of the world’s population has a Facebook account. And these virtual worlds are really cool. I’ve seen them, I’ve been in them. It’s unbelievable, it’s really cool. Like ready, what is it? Ready Player One, I think it’s called. So, that movie was about it. The movie doesn’t do it justice compared to the book.
Frank Curzio: When you are looking at metaverse, it’s a trend when you start researching it. I’m going to be into this trend. So is our company; I think it’s really, really cool. I’m exploring it a lot. I have great contacts, but you’re going to see next three or four years this thing really, really develop. They’re hiring 10,000 people in the EU over the next five years just to build this metaverse platform. Also, Facebook came out and said that Coinbase is going to be their custodian for their digital wallet. So, that digital wallet’s important, right?
Daniel Creech: That’s true.
Frank Curzio: It’s going to allow anyone on Facebook, again, 2+ billion people around the world to send money with no fees and send it instantly, which is a very, very big deal. Coinbase went up on that news, as well as Facebook. But when I look at Facebook and changing their, what are they going to change their name to? Do you have any guesses?
Daniel Creech: Probably something like, “Get In Line, Sheep. We Own You. Or Own All Your Info.”
Frank Curzio: Big Brother Meta or something like that?
Daniel Creech: Yeah. That’d be kind of cool.
Frank Curzio: Yeah, something like that. But when you see this world, you’re going to have full control, basically, because you have one world that you live in, but this is a different world. You have an avatar, you can go in, you can buy different things through it, you can go to different classes, you can have online classes, you could basically watch a game that’s live in this world through and sit on the pitcher’s mound and watch the pitcher pitch. It’s unbelievable of where this could go when you start thinking about it, and your brain just goes crazy once you start researching it. But you’re right. Facebook, I think it’s a great buy here, no matter what happens.
Daniel Creech: And let’s not forget. All this is a lot of distraction from the whistleblowers and all the other bad press they’re getting about how they use your information, how they’re not completely honest with you, blah-blah-blah-blah-blah. Same old song and dance, Frank.
Frank Curzio: Yeah. No, same old song and dance. So Facebook, I agree with you. I think it’s a buy here. Still the greatest platform ever. You make a ton of money in terms of advertising revenue.
Daniel Creech: But the Coinbase news, oh, sorry. Absolutely. It’s a great business model in the sense, and it’s a high margin business, and like I said, they’re connected. Just ignore all the fears of breaking them up. That’s not going to hurt the company. Transitioning there because of the wallet is a huge deal. The Coinbase announcement is a huge deal for what that’s going to go forward. That’s an easy transition to crypto, because Bitcoin hit an all-time high today.
Frank Curzio: Yeah.
Daniel Creech: So, we got to look out for everybody, and the bears calling for another crash now, but that’s just neat to see that market continue to chug higher in the face of negative headlines and all kinds of stuff. But it just shows that hey, more people are going to continue to gravitate towards that. You can’t not change the inner workings of what’s going on to create Bitcoin and cryptocurrency surging without expecting it to continue to surge. So, nothing in reality that made Facebook look good a year or two years ago or six months ago is changing, which is the reason that it’s still going to continue upward and be volatile as it does.
Frank Curzio: We’re seeing Bitcoin at all-time highs today. So, the new ETF was launched. BITO’s a symbol. If you are a retail investor, guys, do not touch this thing at all. It is not for you. This is mostly for institutions. This is based on the future market. You could be buying this thing when it trades at a significant premium, which is most likely since they’re buying futures and the contract’s rolling over. I won’t get into the complicated… It’s complicated, but just there’s so many ways to buy Bitcoin. You don’t have to do it through here. You go SoFi, BlockFi, Gemini, eToro, Robinhood, Coinbase. There’s so many ways that you could buy Bitcoin. You can buy it really cheap in some of those places, but it’s still-
Daniel Creech: And remember, you don’t need minimums, so put a thousand dollars, put a hundred. You don’t need to buy an entire Bitcoin and all that. That’s one of the beauties behind it. That’s good stuff with you. Sorry.
Frank Curzio: No, no. But the bigger point here, this is a milestone. So now, it opens up the floodgates where there’s a lot of ETFs in the works, and you got to look at scary token ETFs, you got to look at ETFs everywhere. It’s funny, because there’s going to be a DeFi one coming out, which Goldman registered for, and this is about two months ago. If you’re not familiar with DeFi, it’s a massive market, $80 billion, and huge, huge growth potential, growing tremendously. But it’s ironic if you think about it, Dan, because DeFi stands for Decentralized Finance. This is about eliminating the middlemen, right? So, the middlemen make so much money, and we have investment banks, Wall Street, they make a fortune on all these fees that they charge basically to be a middleman. Yes, they do more things and create products and stuff like that, but a lot of it is fees, fees, fees, fees, and it hasn’t been disrupted, really.
Frank Curzio: And now, you’re seeing this disruption come in, which is through DeFi, which is through crypto, and again about eliminating the middlemen on Wall Street. Goldman is the biggest middleman in investment banking, and they’re the ones launching this DeFi ETF. So, a little ironic there, but it just goes to show you how the large banks in the world have no choice. They have to get into crypto, they have to get into Bitcoin. There’s a whole other level of things going on right now within crypto and growth trends. The foundation’s been built.
Frank Curzio: But seeing it at highs right now, a lot of momentum behind it. I like the fact that it came down twice to around a $40,000 level. I think if it comes back down, it pulls off of this, people are going to buy it, because they felt like they missed it. It’s a limited supply. It’s a play on almost every risk that you have in the marketplace today, which is inflation, which is I hate the governments, I hate Wall Street, I hate money printing. It just has so many factors. And as Bitcoin goes up, remember, when you see a market go up the crappiest and the shittiest names go up the most, just like when the market comes down, those are the names that go down the most, but a lot of stuff is going to benefit, but there’s a lot of great names within the crypto space that are amazing. Folks, some of the biggest trends within this industry, which is the next layer of, I won’t call it crypto 2.0, but the foundation’s built.
Frank Curzio: But really exciting stuff, and now for me, I’m just waiting. I need to see, Daniel, another Peter Schiff tweet that it’s going to zero, because that’s usually the sign to buy. He always does that when it goes right at the bottom, like 40, but he hasn’t been talking about Bitcoin, saying it’s going to crash, crash, crash, crash. We need that. We can’t have everyone on one side loving Bitcoin or loving crypto. We need those people to say, “Hey, you know what? This thing could crash.” And right now you don’t have that, so that makes me a little worried. We’ll break through, but it could pull back a little bit, but it’ll be interesting. Either way, long-term, this is here. You have to get in, and it’s an amazing market.
Daniel Creech: Yeah. Well said. It’s going to be volatile, but yeah, that’s good. Nothing goes straight up forever, and that’s fine. Just write this down, and as good as you feel right now when prices go up, remember that when prices are going against you. That’s just a good lesson to learn, and you got to put money to work in order to achieve that. It’s just something you got to do, so do it.
Frank Curzio: Yeah. And the only thing I was just going to mention here is just supply chain issues, guys, I get reports on this on a weekly basis. I just got a IHS market report, which is one of the best in the industry, track auto production. Right now, I think it’s something like $210 billion of lost sales. That was an estimate from a previous firm, Alex Partners, I think, and that was from two months ago. That’s a conservative estimate. These numbers are going down third quarter, they got reduced in Q4. You saw ARM Holdings, the large chip manufacturer, come out and say this is lasting definitely into next year. So, is it priced in? It might be priced in a little bit, but it’s going to impact a lot of companies. And you’re seeing it even with the biggest in the world with Apple, 10% cuts due to production delays and stuff like that on the new iPhone. Auto companies is going to extend, but it’s interesting. It takes a long time to build fab plants.
Frank Curzio: But one of the funniest things that I saw within this, we all know that the problems, we all know inflation, but Buttigieg, right? Buttigieg is transportation sector, whatever, he was saying on CNBC, and he’s saying the supply chain crisis is due to Biden guiding the country out of recession. That’s what he said. So, since the supply chain is broken down, goods can’t get in, and inflation is skyrocketing, but that’s a great thing. That’s a great thing, because Biden is saving the economy. Why can’t anyone on any side of the aisle just address the problem and fix it? Why do they have to spin it as something that’s positive?
Frank Curzio: Because anyone that’s looking at this, seeing the inflation, Dan, there’s more of a disconnect between asset classes than there has ever been. If you own assets, you’re getting incredibly wealthy, because low interest rates and money pointing to the system. And if you don’t, it’s a very difficult environment. It’s not easy. Everything’s much more expensive. It’s widening, it’s widening, it’s widening, and for this administration to come in and say, “Hey, this is really good, because we’re coming out of recession. Things are great.” So, the supply chain issues are all messed up. It’s just another reason why politics, man, you got to hate this stuff. It’s crazy.
Daniel Creech: Yeah. Just don’t make the assumption that the smartest people in the room are at the top and in positions of power. That’s an easy lesson.
Frank Curzio: Yeah. Very well said, but again, a lot of times when we’re bringing up politics, we have our own opinions like everybody else, but it always relates back to the stock market. The supply chain issues are for real. We’ve been talking about them well ahead of everybody else, I feel like. I told you Ford and GM have access to the same data I have access to, and they were lying out their teeth, telling you, “Oh, everything’s okay, and it’s going to be a second quarter problem.” Again, they lied, they lied to you. And then now they’re talking EV portfolios and upgrading based on Rivian and Forsa. The future looks bright for these guys with EVs, and by the way, Tesla, you see where that stock’s going?
Daniel Creech: No, I haven’t followed it a lot.
Frank Curzio: New highs, I think, pushing $900 almost.
Daniel Creech: Oh, okay.
Frank Curzio: Pulled back a little bit off of that, but holy cow. These guys were first to the party. You don’t see any other electric vehicles on the market right now. Maybe you see a couple, but they’re just light years ahead of everyone. So, it is going to be interesting to see how this trend develops over the next three, four, five years. Hopefully, it develops incredibly, because all these auto companies are basing everything on this. But first thing’s first, if you don’t have cars to sell, you’re not generating revenue, and that’s going to hurt your earnings.
Frank Curzio: So, there’s only a certain point where you could look and discount it for Ford and GM and say, “Hey, these stocks are still doing pretty well, but we know things are going to get better.” But we’re pushing into a good six months that were terrible. Now, it’s going to be 12 months, going to be 18 months. Eventually, a lot of that stuff’s going to be factored in with all the money you want to spend on building EV portfolios. I’d be careful. I’d watch out for that. I just think it’s going to last a lot longer than expected and hurt a lot of these companies, which you’re seeing right now. Even some of the suppliers, chip suppliers that for the apple iPhone, like Skyworks and Broadcom, they’re also warning as well, saying we’re having trouble getting parts, producing these chips, and stuff like that. So, it is a very, very big problem.
Daniel Creech: Yeah. Well said.
Frank Curzio: That’s it.
Daniel Creech: That’s it.
Frank Curzio: I think we’re done here. I think we’re perfectly done. I think we covered so much, other than Proctor & Gamble really quick. We covered Netflix. Proctor & Gamble, I thought, had very, very good earnings. They talked about prices were being raised. I looked at that quarter. I thought it was a very, very good quarter, solid dividend. Again, it’s not the most exciting company, but I was just surprised. I thought that company was kind of going to be like, eh, out of the early company’s reporting, and that was a pretty good report. And I don’t know if it’s because expectations were bad, but they really did good job of managing costs.
Frank Curzio: It was one of the quarters that I looked at where organic sales, every one of the divisions showed growth. Organic sales grew by 7%, personal healthcare outperformed. It was just every division grew a little bit, and it was much better than expected, and they’re handling the inflationary concerns, which means that they’re able to pass off those higher prices to consumers. So, I thought that was a really good number for conservative investors, P&G. I like where they are. I think the stock is cheap here.
Daniel Creech: Yeah. I don’t think there’s a lot of risk in that name. I just think that they definitely warned of higher costs going forward, and we’ll see what that pressure’s on margins like. But everybody should know that and be aware of that for everybody just with general inflation. So, something we’ve been talking about for quite some time.
Frank Curzio: No, I hear you. All right, guys. So Dan, thanks so much for coming on. I appreciate it. We’ve covered a lot today, as we always do. Questions, comments, firstname.lastname@example.org, or Daniel, what’s your email address?
Daniel Creech: Daniel@curzioresearch.com, Frank. You know that. Cheers.
Frank Curzio: I always make you say it. All right, guys. So listen, today, we’re going to launch a really cool video. It’s all on crypto. Just an incredible growth market, as you can see what’s going on right now, but some people are still not in this sector, even though we’ve been saying you have to have access to this for at least the last three years. That’s why I started Crypto Intelligence four years ago. But now that that foundation has been built, there’s so many growth markets within this that are incredible.
Frank Curzio: So, a lot of amazing names in this space, a lot in our portfolio where investors can get on the ground floor, which they can’t really do in the markets right now. That results in unbelievable life-changing returns, if you could buy some of these companies on the ground floor, not when they come out $30, $40, $50, $60 billion valuations, which they IPO at, or $5, $10, $15, $20 billion valuations, where you see SPACs come out for. So, as a retail investor, it’s difficult. This is a market where you could have access to great companies at the ground floor if you listen to the right person to avoid all the BS and stuff like that.
Frank Curzio: So, I sent out a full video. It’s short. Take a look, because I’m also going to give away one of my favorite crypto ideas. It’s for free. I’m offering an incredible discount to Crypto Intelligence, because I’m getting tons of people who want to subscribe, which makes sense. We’re seeing crypto go higher, there’s a lot more interest in it. But the returns that we’re seeing in this industry, 10X, 20X, 30X gains, and I’m going to show you a snapshot of my actual portfolio. You’re going to see the portfolio. You’re going to see some of the losers in there as well. I think the average position is up 640%. Think about that as an investor.
Frank Curzio: These gains are inside two to three years. Some are just six to eight months old. As someone who’s been doing this for a long time, you don’t see gains like this this quickly, something I’ve never seen in my 30-year career, close to 30-year career, where you can get these types of gains. And this is a market where you can get in ahead of Wall Street. You can get into a lot of ideas. There’s a little bit of a learning curve. We teach you everything, how you buy these things on exchanges and stuff like that, but this is the lowest price that we’re offering it since we launched this thing four years ago, and it’s good for seven days. That video’s out.
Frank Curzio: But even if you’re not going to subscribe, definitely, definitely worth your time to take a look just to learn the potential of what’s coming down the pipeline, the growth markets within crypto, and how you could actually play this through different exchanges, different ways to play it. So, everything is in that video, and it’s a short video. It’s not a long video, trust me. So, it’s pretty cool.
Frank Curzio: So questions, comments, feel free to email me at email@example.com. Dan, thank you so much again for coming on. That’s it for me. Really appreciate all the support, and I’ll see you tomorrow with a fantastic, fantastic interview of a company, whose valuation based on the latest capital raised last month, is over $1 billion, a fantastic company that fits right into the heart of what we’re doing here, which is tokenization. So, great stuff. That’s tomorrow. I’ll see you then. Take care.
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