Wall Street Unplugged
October 5, 2021

What Axl Rose can teach us about today’s economy

It’s been a crazy several months here at Curzio Research. If you haven’t heard, our Curzio Equity Owners (CEO) security token will soon be trading here in the U.S. on the tZERO platform.

My wife and I decided to get away for the weekend… And inflation is everywhere—from the cost of food and drink to hotels and parking (which we found out at a Guns N’ Roses concert). [00:30]

If that wasn’t bad enough, the casino’s jackpot sizes were tiny. 

The casino we visited is on Native American land. I share some wild stats on how Native American casinos are regulated… and what makes them different from other casinos. [12:05]

Next, I explain why FedEx is warning about the rising costs of raw material and labor… and why we need to be prepared for a lot more companies to do the same. [18:00]

A listener gives me a pat on the back for my COVID coverage and shares his experience with the virus. I share some data on why some folks are willing to get the vaccine… while others are still reluctant. Plus, I reiterate why it should be a personal choice to make. [27:10]

Carbon Streaming Corporation just announced a reverse stock split. I’m an investor in this company, and a listener wants to know if I’m concerned. In short, no. I explain why management is taking this action… and why it’s great for investors. [30:17]

Inside this episode:
  • Guns N’ Roses and inflation [00:30]
  • How Native American casinos are regulated [12:05]
  • How rising corporate costs will affect your portfolio [18:00]
  • Why some folks are reluctant to get vaccinated [27:10]
  • Carbon Streaming’s split is great for investors [30:17]
Transcript

Wall Street Unplugged | 802

What Axl Rose can teach us about today’s economy

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 October 5th. I’m Frank Curzio, this is the Wall Street Unplugged podcast, where I break down the headlines and tell you what’s really moving these markets. The wife and I went to the Seminole Casino. It’s located in Hollywood, Florida, this weekend, the last-second getaway that we both needed. I just did a lot of work with the kids, driving them all over the place, now that one of my daughters is actually going to school in Jacksonville, which I told you about.

Frank Curzio: A lot of news on our part. We just broke the news that we’re going to be trading on a tZERO platform. It’s going to provide us much more liquidity. They’re the biggest in the world, trading security tokens. Lots of fantastic news coming out. More exchanges are being launched. They call it alternative trading systems, ATS’s. You don’t have to call them exchanges yet to the regulator… But they are basically exchanges.

Frank Curzio: Lots of fun. Lots of great news. Going to provide lots more liquidity for our token, which means we’re going to be able to grow the company a lot faster. We can acquire companies using our stock, or our tokens. Get us equity stake, hire more talent… We could raise money through it. And that’s what we want to do here. We want to accelerate that growth. That’s why you go public, to accelerate the growth.

Frank Curzio: Looking forward to the months, years ahead. That was a major, major milestone for us. Again, it’s just part of the process. It’s nothing that we should high five each other about. We still have to work. A lot of work. But now, in a very good position. It’s going to really, really grow. And that’s going to be exciting. The team’s excited. It’s awesome.

Frank Curzio: If you’re a shareholder, you don’t have to do anything. We’re going to email you. There’s going to be lots of more news coming out, just in terms of restructuring the token, putting on a different blockchain. Again, you don’t have to do anything. Everything’s going to be fine. I’ll let you know. But you’ll see a couple of emails and videos coming out from me in the coming weeks. But… Busy.

Frank Curzio: It took a lot of work to get that deal done behind the scenes, which is awesome. Love working with them, with the new partners at tZERO. Those guys are awesome. Very exciting news. But anyway, the Seminole Casino is in Hollywood, which is close to Fort Lauderdale, Florida. It’s about a four and a half hour ride. This is a place I’ve been going to with my friends… Probably, for eight years? Nine years? A long time.

Frank Curzio: We go towards the end of March, almost April, for a few reasons. March Madness, so we could watch the games. These are my friends, four or five of them, that I grew up and that I’ve known for over 30 years. Also, mostly to see the Florida Derby, which is in Gulfstream Park, which is like a 10-minute ride from there. We’re all horse racing fans. And the Seminole Casino… We loved it. It had this massive outside area, kind of like Disney Downtown.

Frank Curzio: This is where we used to go, right? This is where we used to go. Now, it’s all renovated. I’ll get to that in a second. But they had this whole outdoor area. Where you had stores, clubs, restaurants outside. You could walk around with your drinks. They had outdoor concerts. It was just a nice environment. It was cool. And then, five years ago, they started renovating it. They closed the entire outside area during this period, which sucked for us, since that was one of the really nice perks of going there.

Frank Curzio: Just hanging out. You can do everything. It’s almost like this whole entire area by itself inside its own property. And it’s cool. For five years, we didn’t have that. This is the first time I went there, because they spent $1.5 billion. Now, they finally finished their renovations, first time I’ve seen it, to basically make their hotel look like a giant guitar. 1.5 billion dollars.

Frank Curzio: It might not sound like a lot of money these days. We throw around trillions left and right. But the Cowboy Stadium cost 1.3 billion dollars to build, just to put it in perspective, which holds a hundred thousand seats, built on a 73 acre lot. This hotel, these guys, $1.5 billion. Again, it’s the first time I’ve seen it fully open. Man, it was impressive.

Frank Curzio: Now, granted, pulling up to a building that looks like a giant guitar… Especially, at night where you have these spotlights shooting… Like, when you see the twin towers that they have there. For every September 11th, they shoot those right up. Huge, huge shooting right up to the sky. It’s really cool. The renovations included a huge concert hall. Much, much bigger casino. More rooms and suites, more restaurants, and a lobby that looks something like Vegas, even better.

Frank Curzio: Massive. With huge waterfalls, and inside the walls and everything was… It was unbelievable. It was nice. But the cost to stay there… Granted, it’s nice. But the cost to stay at this hotel. Again, it was a late trip. Thought about it Thursday and said, “Yeah. Let’s just get away. Get a babysitter.” For Saturday night, was $1,200 for the night. $1,200. I’m not talking about staying in the penthouse. Outdoor cabana, private pool, full A-list experience. I’m not talking about that. No.

Frank Curzio: This is for a normal room. For two nights, Friday and Saturday, quoted me at $2,300. $2,300. That was after taxes and fees, which if you’re traveling, are enormous right now, especially if you use sites like Expedia. Wherever… Priceline.com. You go on those things, they’re going to say, “Here’s the hotel price.” Wait till you see the fees that they’re charging. Holy cow. It comes to probably 20% of whatever you’re paying, whatever you see there.

Frank Curzio: There’s like a little option you can click. It says, “Full price with taxes and fees.” And then, it goes from whatever… You’re paying $500, it’s going to go to like $600 in change. $650. I went to Dallas, it was an extra $200 of fees for two nights. It’s insane. But $2,300? $2,300 for two nights. I’ve traveled, stayed all over the world. Put up at the Four Seasons, Omni, Ritz. That’s when I worked for my previous employer. I always used to have like great hotels in conferences I used to go to.

Frank Curzio: But these rooms, which are immaculate and nice, they were less than a thousand dollars a night back then. Maybe they’re a little bit in that area now of $1200. But the Four Seasons, Omni, Ritz-Carlton, they were always located in vacation areas. High traffic areas where there’s tons of hotels. So, if you don’t want to be in a five star place with your family, there’s tons of other hotels to choose from, which are cheaper and that’s cool.

Frank Curzio: But where the Seminole Hotel is located… And it’s Davie, Florida to be exact. It’s close to Hollywood. Davie, Florida. I know people who’ve lived in Florida for 20 years who don’t know what Davie is. Davie is kind of… Not kind of, but it’s a shit hole, at least where the casino is located. I don’t know if I could say it in a respective way. There’s bars on windows everywhere. There’s porn shops. There’s dope video booth stores, and massage parlors. Not a place you want to walk around at night.

Frank Curzio: But there’s not really any hotels within five miles of this place to stay at. Maybe a few, a couple. For me, I wasn’t paying $2,300 for two nights for a small room that my wife and I probably won’t be in that much, because we’re going to be gambling, hanging out, and enjoying ourselves. Instead, I looked for another hotel and found a Holiday Inn Suites about 12, 15 minutes away. The total cost for two nights was $300.

Frank Curzio: Pretty good savings there, and the room was perfect. You had a little living area and the room. It was beautiful. It was nice. Now, when we finally made it to the casino… We got there Friday night, because there’s a long drive. We saw that Guns N’ Roses was playing there on Saturday. Guns N’ Roses. We got tickets, concert was pretty good. Wasn’t great. It was good. I mean, Slash, and then you have Axl Rose.

Frank Curzio: By the way, I don’t know if you saw pictures of Axl Rose. I don’t want to say he looks like he’s 80 years old, because I’d be insulting 80-year-old people, but he didn’t age too well. I love him. He’s great; vocals were not great. You could see he had a lot of miles on him, but who cares? We were all singing Sweet Child of Mine, November Rain, and Welcome to the Jungle. People were going crazy and it was a good concert. And it was in their new theater, in the Hard Rock. This theater is massive. It was massive. It was packed.

Frank Curzio: Three levels, general admission area included, which is the bottom area where you stand. And then, you have three areas behind you, and it was packed. It was sold out. We were in the general admission area, having fun, drinking beers. I will say… This is, again, a stock podcast. So, I’m going to talk about the economy and stuff like that. The amount of money this place was making is absolutely insane.

Frank Curzio: It was seven dollars for a slice of pizza. The line was like 50 deep at night, with a few places that were open after 2:00 AM. Seven dollars for a slice. Probably, four or five dollars for a Coke. Beer… I’m not talking about anything… I’m talking about Bud Lights were seven dollars on the casino floor. On the casino floor, which in Vegas, a lot of those hotels… I believe last time I went… I went to Vegas a lot. They still give those to you for free when you’re gambling.

Frank Curzio: Not here. Seven dollars. Seven dollars a beer. You feel bad. You’re going to tip too. Think how much that costs. It’s nine dollars for a corona. I think it’s $12 for a drink. But again, a lot of this stuff in Vegas, they give away for free. Their new slot machines that they had there? Very new and weird. Not like the wheel of fortunes or anything like that. My wife and I… My wife likes the slots. I play them with her. It would say when you win, it’s like, “Huge win.” And it paid you like $22, $25.

Frank Curzio: Jackpots were extremely low. The max you win was like $2,000, $3,000, $4,000 on some of these machines. And that’s for betting five dollars, full amount and stuff like that. It was just crazy. The two days that we were there and the slots we played, we didn’t hit anything over $50 once. Hey, we played well. We did very, very well. In blackjack roulette, we did okay in. But it was crazy. We didn’t see anyone hitting anything anywhere. You should see a jackpot, they shut down machines. You should see… People had nothing. Nothing at all. Two straight days.

Frank Curzio: Parking. We got there, parking $30. We valeted, since we stayed at someplace else. We valeted $30. They were like, “We need $30 right now.” I don’t think I’ve ever seen that before. “You got to pay us now.” There’s probably so many people that go in there… They get wrecked. They come out and they have no money, and they’re like, “I don’t care. Just give me my car. I’m not paying you.”

Frank Curzio: But they were like, “You got to pay it right now,” before they even parked your car, which I thought was pretty funny. And I’m looking at this place going, “How could anyone, like an average family, go there and enjoy themselves?” You can’t, unless you have $300 a person, I would think. Table stakes are $25 and up. To stay at the hotel, again, it was super expensive. Yet, it was packed.

Frank Curzio: When I called to book, I saw that there was a discount for Florida residents, just like it is in Disney and stuff like that. I said, “Hey. Look, can I get that discount?” They said, “Sorry. We don’t have any rooms available for the discount, for the Florida rate.” To me, that was a little weird. Because it’s not like it’s a king bed and we have no kings left. You can get a two queens or whatever.

Frank Curzio: You have rooms left, and I’m from Florida. You were just like, “Hey, F off. We don’t need to give you that discount right now, because we don’t need it.” Which makes me think that it was really, really crowded. Close to sold out. People were paying those prices for the rooms. Maybe they booked earlier, and it cost them a few hundred dollars less. But on Thursday, they were trying to charge us $2,300, no discounts. “We don’t care. The hell with you.” Insane.

Frank Curzio: These guys are raking in the money. It’s crazy when you think about it, and maybe not so crazy when you think about it. Because the Hard Rock Seminole, it’s built on property that’s designated as Native American. Native American Tribes are considered domestic sovereign nations, which means they’re not subject to most state and federal laws, especially, gambling authorities, like the Florida Gaming Commission, or the Nevada Gaming Commission, if you’re located in Vegas, where payouts by law must return at least 75% of slot machine wages on average.

Frank Curzio: Here, it doesn’t matter. You don’t know. There’s nobody regulating them. Well, there is someone that’s regulating them. Actually, it’s the tribal government of which the land was built upon. They can have 20% average payouts if they want, and there’s no one there to say, “Oh, too bad.” That’s significant. When you have the people regulating the casino… These are the people regulating the casino. These are the same people who are getting paid an absolute fortune, probably under the table from these Native American casinos.

Frank Curzio: And in order to qualify and get that tribal license, there’s two things. There’s actually about six or seven things, but two things that I saw. Again, I did research on this, which I thought were interesting. But two clauses that you must do, if you decide to build a casino on tribal land. The first, must donate to charitable organizations. I wonder how those are chosen? Probably, chosen before you build and say, “Hey, these are the organizations.” And help fund operations of local government agencies providing services to tribes.

Frank Curzio: “Hey, here’s a quick handout.” It’s not taxes. Right? You’re generating that for state, whatever. But it’s basically throwing money to maybe the DOJ and FBI to make sure you don’t come over here. When have you seen the DOJ or FBI raid a Native American casino ever? Never. Never happens. Never happens. They say they’re like… They could come in, but they really… They never will. They don’t know what’s going on. They have no idea. And they don’t even care.

Frank Curzio: Now, let’s think about this for a minute. We talk about racism in the US, black, white, Hispanic… That’s nothing compared to what Indians went through. In 1830, we passed… I can’t believe this is the name of it. The Indian Removal Act. We actually called that the Indian Removal Act. I know it’s 1830… Might have been better to come with a different name. Maybe the Indian New Homes Plan? Indian New Neighborhood Assistance Program?

Frank Curzio: But Indian Removal Act… Our politicians are a lot smarter these days, using names like the Affordable Care Act, which is the most expensive thing in the world for Americans, accounting for… What? 1.3 trillion of our national debt? I mean, is healthcare cheap for anyone that has a job or owns their company? But it’s the Affordable Care Act. It’s fine. Or the Patriot Act. That sounds awesome. Patriot. Fills me with pride as an American; yet, it’s a license for the government to track everything you do, every second of the day.

Frank Curzio: If you think that’s false, watch Dateline, which is all about murders now. All about murders. My dad was on Dateline. It was one of those Watch segments. It was six different segments. He picked stocks against a monkey. It was fantastic, because a monkey was beating him at the beginning. Then, it went on for like two and a half years, and that winded up smoking him. But it became… Everybody knew who he was after that. That was pretty funny.

Frank Curzio: I’ll tell this story a different day. I think I told it a long time ago. But when you’re watching Dateline, they always catch the guy. They go through the whole story. But at the end, it’s the guy where, “Well, we looked at Google, and he’s searching, how to bury my wife without anyone finding out.” Or, exactly where his last text was sent from, based on the cell phone tower it bounced off of. I mean, they’re tracking everything.

Frank Curzio: They track it. That’s the Patriot Act. But it’s the, “Patriot Act,” such a nice, beautiful name. But the Indian Removal Act, this forced 125,000 Native Americans to leave their homelands, ancestral homelands in Eastern United States, and go west to around where Oklahoma is. This is a thousand miles away, covering nine states. Most had to walk this, where thousands died from starvation, disease, exhaustion.

Frank Curzio: But we basically came to America… Indians owned the land and we just said, “Hey, too bad. Get the F off. It’s ours. Goodbye.” Crazy. We all know the story, but when you look in details and you read about it, you’re like, “Holy cow.” Exactly, how they did this… Now, they’re operating a casino with almost no government or casino regulations which control payouts. It’s a demographic where it’s like… What? 98% non-Native Americans who are gambling, spending money?

Frank Curzio: If you were in their shoes with that history, what would you do? Personally… And I know this shit happened like 200 years ago, but I would do everything in my power to make sure every non-Native American loses every single penny that they got. Seriously, it just makes sense. I mean, I’m the idiot that goes to the casino, but it just makes sense. Right? The way the whole thing is laid out.

Frank Curzio: But man, Native Americans, these casinos… $1.5 billion in renovations for one hotel to make it look like a giant guitar? These guys are like bigger than a Catholic organization right now. They’re filthy rich. Anyway… Quite obviously losing some money at the casino, but saving a ton by staying at a property about 10, 15 minutes away. Going to a Guns N’ Roses concert, which I know all the young guys out there listening… Men, female, young investors are like, “Guns N’ Roses, did you say?”

Frank Curzio: It was fantastic in our day and age, like Machine Gun Kelly now, I guess. I don’t know if that’s a good comparison. Probably not. We had a lot of beers, had fun. It was definitely a nice getaway. Definitely, something we needed. But more importantly, what does this say to the economy? What does it say of what’s going on right now, where we’re seeing massive inflation? Massive, massive inflation. And it could get even worse, especially if we pass the infrastructure plan.

Frank Curzio: Again, there’s some Democrats on this that just make sense. That are like, “Let’s hold on. It’s a lot of money. This is something that could really crash the markets.” Hey, we’re seeing it right now in the marketplace. We’re seeing what? What sectors are doing good during this sell off? We’re seeing financials explode and oil exploding. Technology crashed. I told you on last week’s podcast.

Frank Curzio: It was with Daniel explaining why technology gets hit the most during inflationary environments, because these guys already have high margins. They can’t really cut costs, and their profits are generated in the CapEx of everyone else, of how much they’re willing to spend on advertising and everything else. Once those budgets shrink, that’s the companies that hurt the most, which is why their margins suffer the most. Because they’re already super high. Where cyclicals are able to cut costs, might not get hit as hard.

Frank Curzio: But if you’re looking at oil companies, definitely inflation related. You’re looking at financials? High interest rate means that net interest margin goes higher. There’s a reason for that. Because people are worried about this inflation thing. And if we happen to pass the infrastructure bill, three and a half billion, which whatever… What is it? $600 billion dedicated to infrastructure? Whatever it is… Where are you going to ship these raw materials? You have no containers, you have no ships.

Frank Curzio: Everything’s on back log. Are you crazy? We can’t ship anything right now. It’s almost impossible to get anything in less than four or five months. Most of the stuff comes in six, seven, eight, nine months. You all know this. What’s going to happen? People are going to be fighting for raw materials. Prices are going to go up even more, raising the price across the board for everybody. That’s when the shit hits the fan.

Frank Curzio: Because, again, that’s something the fed can’t control by throwing money at it. They have to do the opposite. They have to take money out of the market to control inflation. However, for now, we’re okay. When I see things like this, we’re okay. Discretionary spending. People paying seven dollars for beers, walking around with the beers. It’s not like, “Oh, they’re trying…” It’s not like you go to a mall and you say, “Wow, it’s crowded, but nobody has bags.” It matters if people are buying shit or not.

Frank Curzio: You just pay a little bit of attention. It matters. See what stores they do… Like I say, you should poll it. Because even now when I go there, there’s lines and they have pricing power. There’s companies that have pricing power. Dick Sporting Goods has pricing power right now. They’re able to pass on those high costs. Nike, not so much. FedEx, not so much. They are raising prices, but these guys are getting hit really hard right now.

Frank Curzio: And there’s some restaurants I told you… I tweeted, I went to one of my favorite pizzerias, and it was closed Monday, Tuesday, Wednesday. I was like, “You’re closed Monday, Tuesday, Wednesday?” And they said, “Due to labor shortage.” So, it’s not just, “We’re cutting back hours and we’re operating at 70%.” “Yes, you’re going to get your food in a half an hour instead of 10 minutes.” No. They’re actually closing their stores. They just can’t get anyone to work.

Frank Curzio: But keep an eye out for that. Because that’s going to be the tell when shit hits the fan, when you really need to get out. Not now. You’re seeing a normal pullback. It’s nice to see a pullback. This is normal for markets. Again, we have a government that believes that growth should go on forever and ever and ever. No matter… Even if it excels higher than the historical rate, like homes, averaging two to three percent increase annually, historically.

Frank Curzio: But we saw during the credit crisis, when you go up 20%, 20%, 20%, five straight years, you’re going to revert back to the mean. That’s when we saw the crash. But if we look now, it’s over the past, whatever… 70, 80 years when they track it. It’s three percent. But when you have exceptional years, which we saw with the S&P 500, with exceptional growth… Growth doesn’t last forever, especially, if you’re accelerating growth.

Frank Curzio: You’re going to slow down sooner or later. Going to have little setbacks. Every business does, from Apple to Microsoft. We’ve seen it across the board over the decades. But right now, be careful. There’s going to be a lot of companies that are going to warn. We’re seeing that. I’m looking at material companies, Sherman Williams… The shipping companies like FedEx. How can UPS not warn?

Frank Curzio: Pepsi said, “Hey, you know what? Things are good right now.” They have pricing power. It’s Pepsi and Coke. Yes, you have other things, but Pepsi and Coke is in every single restaurant. You’re not going to take it out. Maybe you switch from Coke to Pepsi. You got to have one or the other. Can’t go to any major restaurant chain and not have Coke or Pepsi. You have pricing power. They came out and they said, “Hey, things are good,” in their rates estimates.

Frank Curzio: Focus on the companies that have pricing power, because the ones that don’t are going to lower the estimates significantly. Because their costs are going through the roof. Going through the roof just to hire more people. It’s a fortune. You’re going to have to provide healthcare. It’s one of the things I did a while ago, like two years ago. I did it before COVID, with my phone store.

Frank Curzio: The two kids that are in there… I think one of them has kids, but I provided healthcare for them. They’re not going any place, because they can’t get healthcare anywhere at a place that fixes your iPhone and cracked screens. I didn’t know COVID was coming, but I locked them in. I didn’t have to worry about if one of them leave or maybe both of them leave, and then I’m like, “Holy shit. I need employees.”

Frank Curzio: That’s what’s going on right now. Those costs go high. Your raw material costs go high. Just the costs of doing business go high. You have to raise prices. And if people are like, “Hey, you know what? I’m not going to pay a ton of money to go eat at my favorite restaurant, which I was paying 70, 80 bucks for my family. It’s now $140 or $130. I’m not going to go anymore.” That’s huge. You’re going to see companies start lowering their estimates.

Frank Curzio: Ford. We told you about that. Ford, sales were down 19 percent. Stock went up on that news. They’re not producing any autos. They just extended it even further for Ford, those production cuts. Saying, “We’re not going to open our plants, because we’re not…” Ford sells cars, and they have no cars to sell. What do you think is going to… How are they making money? “Well, let’s just talk about our EV investments in the portfolio.” That’s fine, and they’re getting a pass for it.

Frank Curzio: But everything I’m reading says 2023 now. That’s when the supply chain should be mildly okay, early 2023. Remember when they were saying right now would be the bottom? No freaking way. Again, I love Ford. I love their future. I love the investments that they made. Not just the last $11 billion investment, but the investments… Billions that they spent over the last six, seven years I was telling you about, from going to the Consumer Electronics Show.

Frank Curzio: But if they’re getting a pass for generating sales 17% below the comparable period last year, then maybe a lot of this stuff is factored in for some of these companies. I don’t know. I like Ford if you’re going to buy it and hold it for three, four, five years. But short-term, I don’t know. We’ll see. But going to places like this and just seeing how much people are spending. Discretionary spending. They’re having fun. They’re not changing their habits yet.

Frank Curzio: You might see that in other areas. I want to hear from you, frank@curzioresearch.com. I’m not seeing it yet. But we’re going to start seeing it, where people are talking about and saying, “Wow. Did you see how much this costs? Did you see how much this costs?” I’m hearing that everywhere, but people are still going out. They still want to have fun. Because a lot of them were locked in their homes for such a long time. People are still going on their first vacation since they’re allowed to.

Frank Curzio: Being mandated to stay home and you can’t go anyplace. But these are trends you have to look for. Because I’m telling you… Going into next quarter, we’ve seen a lot of companies already warn. Boston Beer is another. A lot of companies that reported after earning season. Now, it’s like the warning season. We’re going to get into the warning. You’re going to see a lot of companies lower their estimates. I don’t know how anyone with supply chain issues could actually predict or provide a yearly forecast.

Frank Curzio: It’s difficult when you’re not getting the materials. You’re not getting supplies, you’re not getting your products for six months. It’s impacting some companies, but not all companies. Just be careful. If you’re buying stocks on this dip, be careful. Because there’s a shot, when you have that… Look at Zoom. When that growth slows and you have that massive, massive premium that people are paying for your stock… Just like Boston Beer, you get wrecked. You get wrecked.

Frank Curzio: And it happens right away. 30%, 40% decline out of nowhere. You’re like, “Holy shit. What just happened?” So, if you want to buy stocks heading into this quarter, just do me a favor, buy small positions. Buy a third position. If it comes down, you could buy more. You’ll approve your cost basis, right? You lower your cost basis. Or, if it goes higher and you happen to be right, at least you own it. But don’t just go right in and buy full positions here.

Frank Curzio: We’re going to see it bounce back… I think we’re a little oversold at these levels from September. We’ll see more volatility in October, like we always do. But the holiday season is the best season for almost all these companies. And I don’t know if they’re going to get their products on time. I don’t know if you’re going to be able to buy the shit that you want to buy for Christmas.

Frank Curzio: I don’t know if that’s going to happen, because these issues are crazy right now. Absolutely crazy. It’s the reason why Amazon is selling Black Friday stuff now. I don’t know if they’re going to be able to meet their estimates, because they just don’t have the products in inventory. Something to think about going into next quarter.

Frank Curzio: Now, let’s take a couple questions really quick. First one is from Joe. He says, “Frank. No one’s done a better job than you researching and analyzing COVID. I’m 74. I had the virus in April ’20, with no problems, and will not be taking the jab in any form. I would advise anyone who is debating, “Jab or no jab,” to listen to your fair balance and well-considered commentary. Thanks for all the great work and the great team you have assembled.”

Frank Curzio: Joe, I appreciate that. I also get emails where I’ll be fair and read some of them where, “This touched a nerve and…” Look, it shouldn’t be mandated to put something in your body when you don’t have the data in front of you. That’s all I think. I think that’s pretty logical and everybody could agree with that. I’m getting my second shot today. And I have to, because I’m traveling. I don’t want to. Why? Because we haven’t published data in the United States on the Delta strain.

Frank Curzio: For me, what I’m seeing is that’s impacting people who never had COVID before much more than people who had COVID already. Whether you had the vaccine or not. We were told 95% efficacy. We’re great with the vaccine. For me, that’s… When we had a Polio vaccine and stuff, you didn’t get Polio again. People got COVID again. Different strain. What happens if another strain comes at 90 booster shots? What’s going on? I thought once we did this, we were fine, but you’re mandating it.

Frank Curzio: Because a second study I saw… One of them is Israel. I forgot the other study. Another country that has a very high vaccinated population. The same thing. You have 5X more, 5X to 7X between these studies, more likely to get COVID if you’re vaccinated compared to people who have had COVID already and not vaccinated. That’s crazy. That means that people who are vaccinated have antibodies that’s helping them out against the Delta strain, which means that maybe those people do not have to get to the vaccine if they don’t want it.

Frank Curzio: If you have the vaccine and someone doesn’t have the vaccine, it’s not impacting that person with the vaccine. It’s not. But what I want to know is how long these antibodies last, which Fauci hasn’t said, Gottlieb hasn’t said. None of these guys said how long they last. We think they last. But it would be better to inject this thing, the fastest vaccine ever passed the history of the world, into your body… Where still, we haven’t really fully tested all the way through yet.

Frank Curzio: Telling you, “You need booster shots.” And that didn’t even get approved by the FDA. Not even close. They were like, “Whoa.” Again, I’m not anti-vax, which the anti-vax crowd gets mad. And I’m not, “Hey, you got to get the vaccine.” But if you do have underlying conditions, get it. It’s going to help you. Absolutely. But I just want to be fair and balanced.

Frank Curzio: I don’t have an agenda here. For me, it’s provide great investment advice. Safety of your families and stuff like that. It’s not promoting an agenda here. I appreciate that, Joe. But again, not all the comments are positive. Some people just watching the wrong things, the wrong shows, listening to the wrong people. I was just fortunate to have an amazing, amazing network of doctors and scientists that email me all the time. It’s really, really cool. Thank you so much for writing in.

Frank Curzio: Last question really quick here is from Bryce. He says, “Hey, Frank, I was listening to your podcast earlier today. I heard you mention that you have invested in Carbon Streaming Private Placement as well. Just curious on your thoughts of their reverse split after publicly trading for less than two months? Not sure if you saw last week’s email from the company… Trust me. I understand the part about the NYSE or NASDAQ listing. Just doesn’t sit right with me. I’d enjoy hearing your perspective on this.”

Frank Curzio: If you’re looking at Carbon Streaming… Bryce also said at the end of this, “I just hope we also don’t see another bought deal or another Private Placement with warrants issued in the future.” There’s a couple things here, Bryce. First, the company stock must be trading… I believe it’s over five, it could be four sometimes, to get listed on major exchanges. Once they list, you’re going to the explosion of volatility. That’s why we are doing the same thing.

Frank Curzio: We have volatility, liquidity, volume. Institutions could come into the stock now. They’re not going to come in if you’re trading over the counter. Same with us. That’s why we’re upgrading to a platform that is more liquid. Right? Because it just opens up more options for us, which is awesome. Not only that, our investors should be able to buy and sell their stock. Right now, it’s very difficult, because there’s not a lot of volume on the international exchange, which we’re trading on right now. So, it’s exciting.

Frank Curzio: That doesn’t bother me at all. They really need to do that. When you’re looking at any kind of split, reverse split, whatever… You’re not changing the fundamentals. It depends on what the split is. You’re raising the price, your share count is going to change. But when you look at the value of your holdings, it’s going to remain the same. Right? That’s really what you want to do. They need to do this, so that’s not a problem.

Frank Curzio: You say, “I don’t want to see a bought deal or another Private Placement with warrants.” I wouldn’t worry about that either. A lot of these companies… They have a great balance sheet, Carbon Streaming. Again, that’s publicly trading now, guys, if you want to take a look at it. But raising capital is not always a negative. I was in Uranium Royalty very early when nobody had even heard of it at 25 cent financing, at a dollar financing. And there was no warrants included.

Frank Curzio: And it was like two and a half years, three years before it came out, before it went public. And then, later on, they went on to raise a lot of money. $1.25, $1.50, and both of those deals came with warrants, which were higher. I wasn’t upset. I was in a lower price. Those capital raises, if they happen… Whatever. If you’re in a dollar to Private Placement and it happened at $1.75, that’s not a bad thing.

Frank Curzio: They’re bringing in new investors, they’re bringing in money, they’re raising money to buy more areas for carbon credits. But you look at Uranium Royalty, they went on to raise a lot of money. $1.25, $1.50 a stock. It was about recently $4.00. Most uranium stocks took off. In short, raising cash is not the problem. It’s how management spends it, which can make the capital raise a great thing or a terrible thing. That’s what you have to look at. Are those two concerns? No.

Frank Curzio: Could there be other concerns? Yes. I’ll let you know. But the people involved in this stock, there’s several billionaires. There’s Ross Beaty. There’s a lot of great names who’ve got the same terms for Private Placement across the board. These are very, very smart people. They just signed another two guys to their board. I just think it’s a good long term play. The whole world, everywhere, they’re going to be paying for these carbon credits. This is the way it is.

Frank Curzio: Even if you agree with climate change or not. Again, I had the whole discussion on last week’s podcast, but this is something you really have to look at. This is one of the ways to play it, along with… There’s other plays as well in the security token space, which I will get to in future podcasts. Because a lot of companies are raising money in that space to really focus on carbon credits and that market as well, which will be absolutely enormous.

Frank Curzio: Okay, guys. Any questions or comments, feel free to email me whenever, frank@curzioresearch.com. Thank you so much. Really appreciate all the support, and I’ll see you guys tomorrow. Take care.

Announcer: Wall Street Unplugged is produced by Curzio Research, one of the most respected financial media companies in the industry. The information presented on Wall Street Unplugged is the opinion of its host and guests. You should not base your investment decision solely on this broadcast. Remember, it’s your money and your responsibility.

Frank Curzio, founder and CEO of Curzio Research, is one of America’s most respected stock experts. His research is regularly featured on media outlets like CNBC’s Kudlow Report, The Call, CNN Radio, ABC News, and Fox Business News. His weekly Wall Street Unplugged podcast—ranked the No. 1 “most listened-to” financial podcast on iTunes—has been downloaded over 9 million times.
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