This is the full transcription of podcast 'Wall Street Unplugged with Frank Curzio' - A simple way to make a killing from a market crash.
#Podcast #Transcription #ReadAlong #KnowledgeUnlocked
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This is the full transcription of podcast 'Wall Street Unplugged with Frank Curzio' - A simple way to make a killing from a market crash.
#Podcast #Transcription #ReadAlong #KnowledgeUnlocked
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 It's Tuesday, September 27th I'm pretty courageous to Wall Street unplugged pockets. We're big the hell it's and Tell you what's really moving these markets It's been terrible the markets last week was horrible Monday as well a little bit before that It's getting wrecked so it's nice to walk in and see the markets of about two three hundred Points on a Dow today around 1% across the board nice to see green sometimes and There's a reason for that especially for today We're you seeing a lot of people starting to come out not a lot but big names are coming out saying listen The feds getting a little crazy here They get nuts with these 75 base point hikes. I Mean, it's not just one. It's not just two. It's not just three. It's probably gonna be four now Which is insane. We've never seen that (1/33)
we've never seen at this level. I mean you can say 40 years in 80s I mean we brought the Fed funds rate. We increased it. We doubled it right now We're coming from zero which is I'm president to all the way through four and a quarter by year end which is expected and We're seeing mortgage rates starting to push 7% now And it's getting scary because you're starting to hear from the businesses starting here from the sectors In Chicago Federal Reserve president Charles Evans said he's nervous about the feds going too far too fast I don't think there's another Fed member that I've seen That wasn't 100% We don't see any signs inflation moderating Going all-in. I don't care much pain you see. I mean, this is the first Fed member non-voting so nothing matters But it's making headlines So he's nervous meaning that with the Fed raising raised by 75 basis points in three consecutive meetings About to raise by another hundred basis points by year, and he's saying it could be very dangerous given (2/33)
that We're not allowing The time To pass through from these current massive rate increases We need them to filter through the system and we're not even giving them a chance because it's every meeting It's almost every single month 75 basis point like 75 basis points. I mean 25 basis point like filters through the system. It takes three six sometimes nine months We haven't even seen the last 35 basis point maybe even the one before that It's getting scary now because you say well, we're not in a recession. Everything's gonna be fine If you saw globally what's going on the dollar going through the roof the whole world's investing the dollar expecting in this crash that's coming But the Fed's just ignoring it which is kind of interesting because not too long ago a year ago They were saying with zero percent interest rates and buying bonds that Inflation is transitory now you're raising rates by the faster you ever rate and you said is no white knight No way, it's gonna be transitory. (3/33)
Yeah, Muhammad Al-Aryan has similar take and Has really been going off on the Fed since last year saying they lost total credibility when it comes to inflation I'm gonna transitory transitory transitory when we have five percent last year Remember if we look at the inflation rate which based on CPI which the Fed looks at since 1992 on An annual basis we never had seen never so the CPI hit over four percent I mean didn't have four percent were at five percent and they were like, hey, it's transitory not to see here. Nothing to worry about Again, now the raisin raised by 75 basis points at each meal like it's absolutely normal like this is perfectly normal But you need to wait to see the impact of what's going on Because it's significantly impacting the markets and it's happening so fast It's incredible if you listen to the companies throughout each sector and look at housing at a standstill See the recent price index from S&P case Shiller said home prices falling at its fastest pace in (4/33)
history in July Granted it showed that home prices are up 16% year-over-year, which is insane and I get it even more insane if you break down those details Tampa and Miami up 31% year-over-year home prices. So yes, they're gonna fall but they fell what 3% 4% and This data is July. It's not August. It's July So wait until you see the data from August when mortgage rates were Around 5% they're pushing 7. They're pushing 7% at 6.8% right now But you guys see home prices for at least 15% From these levels over the next few months or at least by year-end Who's buying houses? I mean you shut off the loan market if you have cash. Yes, if you live in Florida, Texas, yes You're gonna see demand still and prices remain relatively high But essentially shut off the housing market all the growth that's involved with it within six months I'm president Retailers out of nowhere sitting on massive inventories when they've seen these supply chain concerns massive demand We got to get everything up and (5/33)
running get everything stores full all sudden demand shut off like a second Have you seen the chip sector lately? Went from massive Unbelievable demand when we need to build fat plants everywhere which costs probably four billion or more To build these massive plants which take a year at least two three years some of them to build It's a massive process Now all of a sudden in a blink of an eye they have gluts Many of these companies But this is what happens when you raise rates this fast without pausing at all just to see hey Let's take a step back just to see what's going on You get massive shocks to the system where inflation is gonna quickly turn into deflation while you're raising rates Let's think about it. The Fed truly believes and they do they believe that keeping rates over four and a quarter percent for all 2023 is not gonna cause a massive recession. They're expecting five percent growth second half next year How is that possible with rates over four percent the housing (6/33)
market interest rates mortgage rates? Seven eight percent. How is that possible? How are you expecting that? Where is it coming from? I mean, this is massive recession close to a possession a depression But you're looking at these guys. Like what are you doing here? I Get it you were wrong All right, and I want to talk about the past and it's so easy to just you know shit on the Fed Everybody does it but right now we're talking about right now You need to sit back and wait Because you're seeing demand destruction across the board almost across every single inch is happening immediately and This morning Kathy Lewis on squawk box always controversial She's always bullish no matter what innovation innovation innovation bullish bullish bullish. Well, you know innovation works when you have a great market But she was saying the Fed is gonna have a major pivot To easier policy. It's gonna happen soon Just US economies in a recession. I agree. She thinks inflation is peak, which I agree (7/33)
Because the market should be discounting to peak in interest rates and should not be surprised to see deflation over the next six months And regardless of what you think of her she is on the front line when it comes to the biggest most innovative companies And she's seeing this Because she also went on CBC to announce that she wants you a new venture fund with Anderson Horowitz, and I forgot the other firm Raising money where they're gonna give not a credit investors chance to invest in private innovative companies and She said something that was disturbing to me She came out and said when it comes to credit investors that people who are not accredited investors in the younger generation Are much much smarter than these accredited investors when it comes innovation because they are fully engulfed in these trends She has a point if you look at a lot of credit investors are older investors Probably don't really know too much about Bitcoin roblox Real late to Tesla and EVs and things like (8/33)
that So I could see like the point she's trying to make okay, I agree with that the only generation holy cow But they're not smarter than accredited investors when it comes to knowing how a deal is structured and that's important that's significant You say well some accredited investors don't but a lot of accredited investors you got there You got your head handed to you, right? You got the shit kicked out of you a couple times and you realize wow Okay, these guys are raising money and and you know, they're doing it at three dollars And they're gonna go public at five six seven dollars and I'm getting in at three and the person who's doing it Just said they're gonna invest a whole bunch of money on into the deal. They're already in it They're gonna invest another million dollars. What you don't know is they invested twenty thousand dollars and got five six seven million shares at a penny so yeah, it's nice to say okay, we're investing a lot more in the next round, but You know at three (9/33)
dollars it you really have to look at valuations to see if it's a bargain or not because the people coming in three That's fine But a lot of these people are in under a dollar who are gonna be selling the shit out of this as soon as it Opens a five and pushing it down to three and they're gonna be selling at three and two because they're in at a dollar When you were able to get in at three, that's what we saw at SPAC's I mean look at chamath and Branson Marketed version galactic. I mean, it's not a terrible company version galactic. It's it's innovative. It's cool The valuation came out, you know, it was insane And that can only happen when you have easy money policy. You have a bunch of idiots saying oh my god I want to invest alongside these guys when you don't realize they didn't buy these put millions into this stock Which I said it did broke down the stats. I think it was last week of the week before with chamath You spend like twenty five thousand dollars buying millions of (10/33)
shares at point zero zero one, whatever Then you got all these SPAC's and pipe deals once they announced and saying okay Well, it's gonna come out at ten gonna raise even more money and we're gonna give these guys You know stock at a dollar fifty and warrants at 250 and it's coming out at ten meaning You know when you see pressure on these things at seven six five You're like who's selling these guys are making a fortune while you bought it I mean, especially when it comes to you have an investor when it comes to version galactic You're buying 15 20 30 while these guys are pumping the shit out of this Chamath and Branson were pumping the crap out of this thing Why so they could dump it made hundreds of millions of dollars? You Can new investors I talked to a lot of these innovative young people right now Especially with the amount of money we invest in the metaverse and what we're doing within You know d5 metaverse nfts and what we're building here and they are brilliant But they're (11/33)
coming to us because they have no idea of how to structure a company. They have no idea I used to think they were creating these tokens on purpose to rip people off. They just don't know I'm like stop ripping off your your your early investors create a real utility Create some kind of demand Where these investors are gonna benefit because when they benefit if you sell this company they do well They're gonna be with you for life. That's how I built my credibility over the last 30 years But they don't know better You don't understand that issuing a billion tokens and you have no demand and no utility feature And all you're gonna have is sellers unless you're pumping it through some kind of social media channel, which is discord and telegram these days But it's interesting Because yes, it's nice for individual investors To be open to these ideas, but they need someone there to say hey, you know what? I mean who knows where? Kathy what is getting in it? Is she getting in real really early (12/33)
and doing a second round or a third round because she's invested a lot of these companies Where even though they're down 60 70 percent? Kathy would made a fortune on these because she was in very very early and yes, you could say well she's down 45 50 60 percent On some of these names that's from the highs But she was investing I mean look at all the names she invested in during the very early early rounds It's how'd she make a fortune But hey, she did say something interesting about Bitcoin That Bitcoin is going to reach 500,000 Within the next five years five hundred thousand. It's twenty thousand right now over twenty thousand and notice how it's been Maintaining these levels. I mean, what's the 18 to 20 21 22 around there, but over the past what? Month month and a half went while stocks tanked May find that interesting how come gold's not seeing that bid Well, the dollar's going up, but the dollars not impacting Bitcoin as much as it goes higher as it is with gold People run into (13/33)
the exits hard to invest in gold with two years yielding more than 4% why on gold stick in a two-year why? Bitcoin Is different are you seeing it to couple itself from the market for the first time in a while, but it's been happening Again, maybe interesting saying wow how's Bitcoin holding up here? It's not that interesting if you do the math if you look at the trillions that are going to have access To Bitcoin to aetherium to some of the big names Look at ripple surging And I'm gonna keep it running So basically what that is is the emergency alert because I am in Florida. We're getting a hurricane So I'm gonna keep that in here usually we like pull it out and say oh no what happened I have my phone on mute too, and that still comes through, but we are experienced our hurricane Not gonna be bad too bad on our end, but yes, Tampa is supposed to get nailed So we'll be reporting about that even tomorrow when it really hits But yes, they're warning and going crazy and again people are (14/33)
worried not really on our coastline That's another topic hot topic they're gonna be talking about tomorrow, but getting back to Kathy woods with Bitcoin 500 It's 20,000 500,000. I mean you could say a hundred thousand right now even that would be a bold forecast But you've seen the access To the institutions and these institutions are having a gonna give their clients access to Bitcoin for the first time ever like the Fidelity's Charles Schwab Black rock don't take my word for it look for how much these guys In terms of assets they have under management From 4 trillion to 20 trillion trillion trillion trillion 1% comes in you're looking at Bitcoin tripling from here What is it 300? 400 billion dollar market caps under 400 billion right now They can have access to some of the biggest names But this is where the money is flowing into even in this market That's why they're raising money in so many of these funds when NFTs defy metaverse you see Walmart one what came out what? Recently a (15/33)
couple days ago entering the metaverse Sonic the what roblox You're gonna create two metaverse experiences once called Walmart land and the other is the universe of play and then second one's gonna be a Virtual game platform right with a video kind of like video games and giveaway Certain things gonna blimp that drops toys and music festivals. They already announced a big concert with three major artists virtual stores merchandise But the understanding how big the metaverse is and 80% of people who go there buy something that all the retailers are going into this space But they're targeting what Gen Z? 25 or younger Millennials under 40 You look at roblox 52 million daily active users They want that audience. That's incredible Hayden this company spelled H a de an to web 3 metaverse company using Computing to scale virtual and metaverse worlds they just raised 30 million in a blink of an eye this is over the weekend 30 million who they backed by epic and ten cent to the biggest In (16/33)
terms of gaming you're seeing money continue to flow into this area. This is where the world is going This is where the innovation is going you're gonna continue to see money pour into these sectors I'm just amazed by the amount of money especially giving these current market conditions Ford Now it's last week. They're entering the metaverse and nfts you file for 19 trademark patents They're creating this open platform not a closed platform like what you see on roadblocks where roblox makes the money Walmart makes the money know For I like what they're doing here. It's an open platform where any developer can build a car use digital artwork They likely share profits with Ford But this is what an open metaverse is all about it's unleashing talent around the world not just Talent from developers you have under your own umbrella You have tons of amazing developers out there. They're gonna be able to take advantage of this opportunity That's what the open metaverse is about instead of (17/33)
getting locked down with a company and making $300,000 a year we're generating you know 25 million dollars in profits for company based on your ideas now You go to these companies or Create through their website and Ford's gonna share probably a large percent of the profits with you And you're gonna have ownership a lot of this stuff And benefits Ford right if someone comes up with innovation for a car that looks absolutely amazing. It's gonna sell you know five million Units of this car based on the design from someone else they would do that in a heartbeat They give someone five ten million dollars in a heartbeat. Let's sell billions of dollars in this car makes sense Benefits Ford benefits of developers be independent. That's what the open metaverse is It's unleashing talent around the world and these developers where again. It's not just in-house people It's the world right that's Creating that's innovating. That's the future. That's where this is going And of course it's the data (18/33)
aspect we don't have to share all your data, or you're not sharing it They're stealing it from you and making money off of you, and that's the model right Google Facebook I think that's the model you get to use these sites for free But they steal everything from you and give it to third parties that can email you call you I mean, I can't tell you how many people call me at least three four people call me there you know They know where I live they want they're like oh, it's your house for sale We could sell if you don't even know me. I'm getting three calls a day from people all these lists What do you think they get this information from? That's why the largest companies in the world are investing so much a biggest Investors billions and billions and tens of billions of dollars into the metaverse This is where it's going people are sick of getting their data stolen the open metaverse is what it's about Good forward sees it Okay, Walmart's testing you're gonna see roblox benefit (19/33)
tremendously because they're testing plus They have get 50 million daily active users so everyone's gonna be testing on those platforms Nike worlds built on roblox as well See if people purchasing stuff And roblox could have an advertising model pretty soon now They just sell different products and sell different things and skin stuff like that through their site But that's the testing ground for roblox and then if the roblox and they're gonna realize wow let's go They're gonna do what Ford does let's open this up Let's see if anyone else outside our company has ideas of how we can grow and we'll pay them for it It could be some kid in a small town in India that nobody knows about it's gonna come up with a great solution for a major problem that Walmart has And you'd never have access to that person unless you had an open platform an open metaverse With that said knows ideas when it comes to equities You have to be careful you guys especially in October It's not because it's what we (20/33)
see all the crashes happen. It's true We just broke through the lows and yes, we're up a little bit today, but we're in dangerous dangerous territory You have people gonna see a statement for the first time and they're not gonna be happy At the end of this month. They're not gonna be happy Yes, a lot of us have access to online we see our but some of them. You know a lot of Retirees don't have working power of watching their home price start to decline again It's still up a lot, but hey my home price is coming down now my portfolio is coming down Considerably down 20% plus likely across the board and really just got hit in September What are you gonna? Do they're gonna be like wow all right? I'm gonna go to cash or buy the two-year generate 4% not bad Also if you look at mutual funds Mutual funds have until October 31st to lock in capital gains of course. It's not gonna be capital gains. It's gonna be losses That they're sitting on So that's for tax purposes Individuals have until the (21/33)
end of the year mutual funds have until October 31st It makes sense for them to be selling like crazy Because they're sitting on massive massive losses many of these people You can offset your gains Which is for selling? You can see lots and lots of selling and probably selling at the lows So if you think something's down 25% is trading at a 9 PE and it's growing those earnings by 10% You're like this is a great deal be patient wait Because you're gonna get a better deal. This is gonna happen throughout October Especially with funds who was it 90% are underperforming and Underperforming significantly, and this is going on during earning season where many companies Are gonna be lowering or removing their guidance like FedEx did Since every sector one by one is going to experience with the housing market the chip sector has just experienced Massive demand and out of nowhere within a month month and a half two months. It shuts off demand destruction That's what happens when you raise (22/33)
rates at this pace this fast as quickly and while you're seeing this massive destruction in demand Consumers closing their wallets what's happening people are flooding into the dollar which is up like 20% where Every 2% move higher in a dollar user results in a 1% decline or to headwind earnings through 20% the dollar so gonna add 10% hit earnings earnings if You're looking at the analyst, which is what I do Daniel does we look at this we look at earnings see they're not lowering. They're lowering. They're not lowering fast enough and That's why you're gonna see so many of these companies say you know We're removing guidance because you're gonna be able to get away with it FedEx Warren you're gonna see other companies Warren say we need to wait and see because we really don't believe That I mean our earnings just got destroyed We've seen demand come down for most companies throughout both sectors And yet we're watching the Fed tell us that they're gonna considerably raise rates further (23/33)
and keep them that high through 2023 into 2024 for a full year if you're a company and You really believe that the feds gonna do that what you should because that's exactly what they said and they reiterated from Jackson Hall over Here again last meeting and it keeps saying they're gonna do it How do you offer guidance if you're in a housing market? How do you offer guidance when everything's getting turned off? And you just went from three percentage streets in January to close to seven percent and probably going higher How do you order your supplies how do you build houses yes, you have the current contracts under a negative fulfill those Requirements for many of these places and yes, you still have a Surprise problem where there's not a lot of supply for homes But even the chip sector we're sitting on this massive glut now. Where's the man gonna come from? All these auto companies are they are these people who put down? $500 for a new EV that you were supposed to get a year ago And (24/33)
you did this two years ago now You just realize that EV you're gonna purchase is 35 40 percent higher than what you were gonna purchase it for Are you gonna pull that now and say you know what let me just buy like this gas vehicle Instead of buying a brand new first-generation car that you it's gonna get recalled at least five times because all these guys never built an EV in their lives outside of Tesla and Scaled it you're gonna see it you're seeing it now. I mean Ford the EV almost all EVs that have been released have been recalled That happens all the time But even more because the battery technology you're gonna replace the battery whatever Seen lots of recalls they run into lots of problems. They're trying to get these things to market so fast I haven't been able to test them as they normally test them We'll see so the good news The good news here is stay patient Once the Fed stops raising rates, which by the way We've never seen the equity markets bottom as the Fed is raising (25/33)
rates during a tightening cycle. It almost never happens You usually need to see interest rates top out and they haven't topped out. They're still going higher Maybe a little bit lower today cuz the marks going up but still the trend is higher We've haven't seen it. It never happens ever happens. It's not gonna happen this time If you just randomly say wow, I like this stock. I like that stock. It makes sense to buy this be careful It doesn't even matter what stock And I thought Costco's numbers were really good. Yes subscriptions came in a tiny bit light, but they 17% growth I believe it was in sales 11% in earnings if I'm not mistaken The stock was already down over 20% from its highs and it got nailed on that news Was it a fantastic quarter? No But it was pretty good and I guarantee that quarter is gonna be better than 90% of the companies that are gonna report going forward over the next month month and a half But look out so we all gonna have incredible buying up to you, but you (26/33)
need to be patient And for now focus on some of the few things that are working Bitcoin is working innovation with the NFTs and the metaverse is working You see more more companies become purer plays on that not just a small portion of it But roblox is a great play. I mean it's down 70% they're still growing and Still signing up tons of customers, but at 30 bucks 30 something. I mean seems like a steal down here Uranium Uranium is not going away. I mean that demand even if prices come down and we see what we're doing strategic oil reserve. I know president's doing keeping all prices low into the Election Season I get it makes sense. I know why he's doing everyone knows why he's doing it, but it's you know If you're looking at what happened to these companies what happened in Europe? They're never going to make they're gonna make sure the next 30 years they're never in a position like this where one country like Russia could just Pull 40% of your energy and you're just stuck on an (27/33)
island going. Holy shit. What do I do? You sitting there with one of the best options in the world safest Cleanest 24-hour base load power available That means all day all night not when the wind blows not when the Sun comes out And you're seeing in Europe. I mean they're going back to coal right Germany's going back to coal Major finish go back to coal. It's not a surprise These climate change idiots don't care but people are going to die unless they get heat in the winter and they're in a lot of trouble Over there, it's bad Nuclears the option Uranium, so I'm interviewing Amir Adnani on Thursday's a president CEO co-founder of uranium energy UEC It's gonna be on Thursday great great conversation. Make sure you listen, but that's an area that stocks have Been volatile well off their lows will pull back from their highs. But wow, I think this is a great market government supporting it now Our government supporting it now makes a lot of sense Let's see when it comes to the market Let's (28/33)
see how much of these stocks sectors sell off because even biotech looks incredibly attractive Look at names that are trading at or below net cash If you get biotech is a mark that peaked in September 2021 so a year ago the four or five months before the overall equity market peaked and these things have gotten destroyed 70 80 percent 80 percent plus good names that actually generating revenue That's a great opportunity that markets probably gonna come back a lot quicker I still think it's it's probably 20 25 percent off of its lows, which isn't really saying that much Because they were down so much but great opportunities there But overall going into next month guys follow you stops. You have to play defense by puts Which Jenny Terranova's been doing in our money flow trader newsletter. She just booked another triple-digit winner what the February 2023 put on e zu which is The Eurozone ETF that tracks large and mid cap stocks within Europe, so basically she's betting against European (29/33)
equities so get this she bought this put last month and just closed out for a hundred and fifty percent gain and Basically has been doing this over and over and over again for the past ten months Well, the equity markets have been absolutely crashing and buying puts is not shorting You don't have that unlimited risk which you have to worry about the only risk in amount of money you put up to buy that put Moneyfold trader if I had a guest guys probably the best before in financial newsletter this year. I mean nobody's even close Very proud to have this product under our umbrella We do a special interview with Jena get some of the favorite ideas going forward What you do is behind our paywall for existing subscribers all existing subscribers It's an instant money for a trader trying it out for three months Same an email Frank has a research comm you need to learn to protect yourself If you're not interested you think all Frank's selling something or whatever This is something I've been (30/33)
pushing as soon as it's that pivoted in November it's a fundamental change in the market and Forget that this is protecting yourself or hedging This is how you make a fortune when the markets crash you agreed Meter should be going through the roof because if you're able to generate these returns while the market is coming down You're gonna be sitting on massive cash Especially throughout tokes this market is incredibly overvalued it's either gonna fall a ton in October a fall lot over the next few months as The Fed continues to raise rates. It's gonna be a very difficult market But if you look past if you look man the last 10-12 years If you look at these market crashes they happen quickly they happen fast and then You see the markets rebound now It's different because the feds raising rates, but the Fed cannot continue to raise rates and keep them well over 4% For low in three to six months even three months You're going to see it you need to take a step back and watch the monthly (31/33)
data forget about the CPI since it's fixed and use Shelter as 30% of that component we saw inflation last month with energy prices crashing Think about that. That's how much You're Looking at rentals and Shelter accounts for the CPI stop looking at that because that's not going down anytime soon Listen to the companies listen to what they're telling you because we're looking at two rate hikes to 75 base point rate hikes and another one coming the last two are not factored into the market yet and you're seeing Sector by sector shut off demand destruction be very very careful. It's gonna get worse before it gets better. We broke through the lows It's not a good sign But be careful cuz it's gonna create an unbelievable buying opportunity But there's times to be aggressive times to be patient play defense play defense You get to have the money flow trader if you're interested Frank curves research calm And any questions guys during this time? I know it's rough getting a lot of questions. (32/33)
I'm here for you Frank has research calm just feel free to see me in mail whenever you want really appreciate all support Now I'll see you guys Daniel tomorrow. Take care You (33/33)