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0:00:02 – 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.

0:00:16 – Frank Curzio

What’s going on out there. It’s July 24th. I’m Frank Curzio at the Wall Street Unplugged podcast, going to break the headlines and tell you what’s really moving these markets. So, staying on the interview format here, I’ve got a good one coming up for you. This one’s with my buddy, Andrew Horowitz, and Andrew I love having on. He’s also the host of Discipline Investor Podcast.

Horowitz and company also manages money, because he’s another guy, like last week, you can go anywhere with the interview and we’re going to talk about Trump an assassination attempt, buy and drop out of the race. How do those factor into equities and your market strategy going forward. Going to talk about the Fed’s coming rate cuts 100% chance now, which is not a chance, but 100%. That’s the factoring for a September cut. The first one, but there’s going to be more in the way. However, it may not be a positive for equities that everyone’s saying, so we’re going to break this down. Talk about that more. Also, Andrew, like always, is going to share his favorite ideas. He has an amazing track record probably better than his management company when it comes to sharing ideas on this podcast, and he’s going to have at least three, four ideas he’s going to share in this interview, which is really, really cool. But he does have a great track record for the stocks he gives us on this podcast, so I always tell him, more recommendations is great. I know my audience loves him and I love him as well, so sit back and enjoy.

And here’s my interview with the one and only Andrew Horowitz. Andrew Horowitz, how’s it going, man? Good to see you. Hey, frank Curzio, better to see you. Well, how are you doing? Your voice sounds a little sore there. Buddy, everything okay, well, long weekend.

0:01:53 – Andrew Horowitz

Long weekend and healthy as a horse, but was out in Miami on Saturday night so I guess I was talking too loud or something. Who knows? Yeah, but this is what we need, you and I. That’s our, that’s our, that’s our. Bread and butter is the voice.

0:02:08 – Frank Curzio

It is the voice. Unfortunately, we got a video going. I mean, we do voice for a reason, both of us, but you know we do have a little video every now and then, so we have a we have a face for radio. I gotta tell you, I week too, and prices there are absolutely insane, insane. I mean it’s just. It’s so insane that I mean chocolate bars that my daughter wanted to get a chocolate bar from one of these places. It was like eight dollars for a chocolate bar.

I don’t like it, just every single thing. It was everything that we bought. It was absolutely insane on the strip compared to, obviously, being off the strip, but if someone’s been going there for a long time it’s been a little crazy right now prices, but I just can’t see this being sustained. I don’t know, come down to South Florida.

0:02:50 – Andrew Horowitz

I was at a restaurant on Saturday night. It’s called Sexy Fish. Supposedly it’s a $40 million build-out. Wow, my voice does sound terrible $40 million build-out of this property. But I looked at the wine list and I’m like no, no, no, no and they had multiple pages of this wine list. The most expensive bottle was $65,000. I don’t even know what it was.

0:03:14 – Frank Curzio

I don’t know who ever bought it. I know you’re part of the 1%. I got two. I got two. Yeah, right here, buddy. Hey, come over here. Why not me for the whole place? But and why?

0:03:23 – Andrew Horowitz

not me for the whole place, but most of the most of the wines. Uh, we got. We got a bottle that was, I think, $70, which you probably buy in Publix for $3. That’s, it was terrible wine, but we weren’t spending the money. We’re like we’re not spending the money. This is no way, um, but the food was, was reasonable. We had this. It was like kind of a sushi vibe, but the, the, the atmosphere was just beautiful. It was, it was. It was one of these things you go you know why do you go to certain places, right, you know what I mean. It was like it was just beautiful and the presentations were beautiful, the people were beautiful. It was just a great Saturday evening and we didn’t have to spend crazy, crazy money because we just kind of picked around, um, you know the menu, but definitely stayed away from the wine well, we’re in in good hands because the cpi is coming down, which is totally supposed to be bad news.

0:04:12 – Frank Curzio

But that’s great news, right, because the fed is obviously going to cut. We’re going to get to so much because so much has happened in the past couple weeks, especially with politics and trump buying dropping out. But let’s start this as we’re going to prices, because, uh, we’re, what I’m seeing is prices aren’t coming down for a lot of places. Maybe you might see Walmart mentioned here and some other places like Target, but I haven’t seen them coming down. I haven’t seen rentals coming down. I haven’t seen it come down meaningfully, but yet the CPI was decent means the Fed’s going to cut.

Is this actually good news? Because usually, when we see this not usually every single time, we’ve seen this over the past 50 years when the Fed actually pivots, especially when they start cutting on that pivot, we see the market come down and it starts coming down. Well, here comes September. I say be careful what you’re wishing for. What do you see now? That there’s 100% probability, 100% price into a September cut now, which I find very weird, because usually you won’t get a cut into an election year.

0:05:04 – Andrew Horowitz

They don’t want to have any kind of, you know, apparent or maybe even thinkable idea that the Fed is being political, but I’m still thinking it’s not going to happen in September. I think they just, you know, they might as well wait just a couple more months and, if they really need to go, go in December. But I agree with you, you know it is not a good sign when the Fed cuts. I know everybody’s all like, hey, the Fed’s cutting, and they got this idea that, wow, it’s back to I don’t know, post-financial crisis, post-covid, when the Fed flooded the markets with all sorts of stuff. This is different. This is not a crisis cut. This is a cut because they think that they’ve done too much to hold back the economy, so they’re making adjustments to their own numbers. What’s really fascinating, though, is that you know the Fed wants to cut. The Fed needs to cut, and the reason for that is that we’re paying such a high price for our debt service, and the Fed knows that the cost of our capital. You know, if we were, if you or I had this kind of balance sheet, we’d be out of business a long time ago, and there’s no way, after a while, that you can keep up with that debt service. So what’s happening is the Fed realizes that they need to do so. So we went from inflation to, maybe hyperinflation, to disinflation, and now the one data point, but the last number on the CPI, was actually deflation. So the Fed is like OK, let’s take this opportunity Now.

The PPI that came out a day later didn’t show the same thing. In fact, the core was pretty hot overall. Right, it showed a pretty big number. It’s fascinating, though, that the Fed will wait long enough when the numbers don’t agree with their basic thesis. But one number, it’s like hey look, we conquered it again. And I think the other thing that everybody needs to understand you know this, frank, we talked about this is that inflation will moderate. Just from a calculus standpoint, right, just from a calculable. This is, unless we become Argentina or Venezuela, there’s no way we’re going to see inflation that goes off the rails forever. It’s going to moderate.

The problem, though, is, even if inflation is at zero right now, prices as you mentioned in Vegas and I mentioned in Miami Tremendously. They’re absurd. So what do we have? We have a situation where margins amazingly held up by many companies. You know we see the net interest margin of banks. We could talk about that a little bit with the earnings they had last week.

Yield steepening, yield curve steepening, has been really good for them recently. You know we saw some all-time highs in some of the banks and the investment companies. You know the major financials recently, homebuilders holy mackerel. Would you ever thought that homebuilders, in an environment with an increasing interest rate, would actually be at all time highs? Dr Horton hit an all time high last week, blew out the numbers, Lennar unbelievable numbers. Look at the homebuilders ETF rocketing higher. I called a short on that, closed it really quickly. I’m like you know what this is not playing. Two days later I’m out and it just went straight up. So there’s a lot of strange things happening and I’ll end with this point on this is that it’s still all about what happened during COVID the exceptional amount of stimulus that went out, the Inflation Reduction Act, which was the anti-inflation stimulus bill I love that name.

That’s such a great name it’s all part of it, frank right, it’s all continuing with this flush of money and, I think, the reality of the excess that was built up, sovereign wealth funds that are sticking money into our markets, and then the euphoria surrounding the latest narrative, which is not the Fed rate cut but with AI. So it’s all kind of this infectious FOMO. This let’s get in on the bandwagon. People have seen how great it’s been over the last X number of years and thinking, just to bring this full circle now that lower interest rates are another catalyst towards the next leg of stock market being higher. But in fact I believe and I think what you’re saying is also that maybe it’s actually a reality check that the economy is slowing down.

0:09:21 – Frank Curzio

Yeah, I mean, the Fed cuts for one reason, right, they think the economy is slowing. Right, so you got to put that in perspective. So, just like when they’re raising rates, the reason why the market almost always goes up during that tightening cycle is because the economy is so strong. They’re trying to rein it in, right? So this is the opposite. Now the Fed’s finally saying okay, I see a slowdown coming, so now it’s time to cut. And you have to realize that, because that’s not the great news, for that everyone thinks it is like everything’s going to roar higher. No, there’s certain there’s going to be certain beneficiaries. Maybe banks aren’t as best beneficiaries this time because of their, their um, net interest income right, it has surged. Right, because interest rates go high. They do very, very well.

And much better because rates were higher for much longer than anyone anticipated. We talk about cutting rates for the last 12 months at least we thought it would happen by now, but you know that rotation and where do we go from here, is kind of tough. Because you brought up an interesting point, I want to get your opinion here. It’s a tough question, but we got the smartest guy in the world on, so that’s what I’m asking you. That’s you obviously Two really really smart guys. We’ll figure this out, no problem.

You know we’re history of the look at the history of the market, right, and you’ve never seen this happen before. And people say, well, you know the past, and when it comes to history it often rhymes. And then you know we see this happen. We’ve never seen home builders like nobody, nobody at all. 0%, 0, 0, 0% predicted that home builders would absolutely surge if interest rates are going to go this high. Right, and a lot of people didn’t think the market’s going to surge to record levels. Right, we didn’t see margins go higher. Margins are going higher, as all this has taken place with this massive tightening cycle that was supposed to slow down the economy. It appears like it didn’t really slow it down that much. Right, it really didn’t. It curbed inflation a little. Why is it different this time? When you look back at 50, 75 years, we’re seeing things that we’ve never seen before.

And when I see a guy like Mike Wilson and Morgan Stanley and people are basically shitting on him because he was predicting the market I read his research. His research is fantastic because it’s not like hey, I think this is going to happen. He provides 50 to 100 charts showing this is what happens. Look at the money slide. Look at M2. Last time this happened, it only happened the last two times. We’re in a 2008 financial crisis and the Great Depression, and he’s citing all this stuff that happens, but none of it happened. So is that because of the massive stimulus? Because we’re talking trillions. But why are you seeing this disconnect? Because usually guys like us, we’re history of the market, we study and say when this happens, the last 10 times this happens. But it’s not that way right now, where you know things are definitely different people.

0:11:48 – Andrew Horowitz

So you got to worry if you think things are different, because they’re usually never different yeah, well, I think the big issue with regard to um the home builders is that there’s a the, the generation that has come out of the basement that was living um through the financial crisis, the millennials living through the COVID are like, all right enough, and there’s a discrepancy between the availability of existing homes, and the problem with existing homes is they’re priced out of control. People realize they’re trying to get crazy numbers on their existing homes and I think there’s a little bit of a benefit towards the new home builders, as crazy as that sounds.

0:12:22 – Frank Curzio

They’re cheaper. They’re actually cheaper than existing homes. People have to come down. Why are you going to? You know?

0:12:26 – Andrew Horowitz

if you get a new home.

0:12:27 – Frank Curzio

Why get an existing home? I mean, you might get a little bit less square footage, but that’s never happened either in history. Again another thing that’s never happened where new home sales should be higher and they’re actually lower than what people want for existing homes.

0:12:40 – Andrew Horowitz

So, $500,000. It doesn’t matter the number, a million, 2 million, 300,000. It doesn’t matter, but that’s up a lot. Let’s say then, compared to a year ago, two years ago, five years ago, right? So you’re going to move. You decide, hey, I’m going to collect my money, I’m out, I can get a huge profit on my house. Okay, where are you going? First of all, it used to be that you could just take your profit tax-free. Well, these numbers are now not necessarily going to be tax-free. You’re not going to 1031 it because it’s not a commercial property or a rental property, right? So it’s going to be your personal residence. So you’re going to move it somewhere. You may pay taxes on that.

0:13:12 – Frank Curzio

Possibly You’re going to move. You get a $400,000 or $500,000 exemption fee.

0:13:17 – Andrew Horowitz

Exactly, but that’s not a lot compared to what it was 10 years ago. $500,000 you made in the last number of years on a house. You would have $500,000 house that you bought in 2010. You’ve made a half a million dollars on it Probably. Yeah, okay, easy. So now you want to move. So where are you going? You’re going to go to. Well, you’re not going to be in the undeveloped acreage in blah blah blah, Kentucky, somewhere that maybe that you know if you’re a city guy, right, you’re not going to go necessarily to. You know certain areas. You’re not going to go north. You’re not going to go to New York and you’re not going back there because the price are out of control there. So what’s happened is now you’re stuck. So where are you going to go? I’ll make a lateral move. I’ll move horizontally over. That way. It’s a mortgage rate, though Now you’re going to get a mortgage rate that’s going to be higher 3%, 3 point whatever.

You’re at 3, now you’re going to go to 7. And now you’re going to go from a tax base that slowly crept up because there’s a limitation on in most states. There’s a limitation on how high your taxes can go. You’re going to go and buy a house. Now you’re going to pay, instead of 2% on the $500,000 house, you’re going to go pay 2% on a million dollar house. Wait a minute, how is that all going to work out? So now, unless you’re moving because you have a job that needs to move and there’s something that’s happening, you’re not going to desirously just move to move. The idea of moving up is a real problem right now. So people are sitting on their houses, so you’ll start to see by the way and you’ll see.

And, by the way, the inventory is very low because people are like hey, you know what? My house went up this much. It’s going to keep going up. But wait until you start seeing a few different signs on the block and, all of a sudden, the wait time to sell expanding.

0:15:04 – Frank Curzio

And the next guy is going to say I did this, Andrew, my last house in a great area in Amelia Island and it was on the market for nine months and we had to lower the price probably by 15%, and I was pricing it with the market. I wasn’t, you know. I mean, some people are like my house is worth $5 million when it’s really worth $3 million or whatever $500,000. I was like pricing in the market but how to keep going lower and lower? And then, finally, the only person I think we had one bite, and another person all cash, all cash, all cash. You’re king. That’s fine, right, but it was very difficult and one of the negatives is it’s not really the biggest family area and I have two floors upstairs, downstairs, which eliminates maybe the older people who like one floor from coming in, and not too many families and jobs, but still it was difficult for me to sell. So you’re seeing that across the board as a negative, but it’s just amazing.

0:15:52 – Andrew Horowitz

Anybody should go. Look on Zillow, look at their. There’s different days on, market days, on how long it’s been on, and see, just take a look. And once that happens, people get freaked out. They’re like, wait, wait a minute, maybe I should put my house up and they start panicking. When that happens is they start lowering prices and then we see this cascading effect which is the inflationary environment for that. But again, to get back to the, the new homes. Yes, it’s much easier just to get. And how nice is it to have a new home. That new home smell and new closets and everything’s working.

0:16:23 – Frank Curzio

And you know you don’t have this’t have this leak all of a sudden For like two months, three months, yeah, for two months you get everything working. But you know what I’m saying.

0:16:29 – Andrew Horowitz

But you don’t have to worry about replacing the roof for another 10 years or something like that, and the appliances, you know, you don’t have to have anything to break. But you know what I’m saying from old age, you know. So have all these different things, like you know, hey, pickleball and pool and club, and all this stuff that people want to have. Now it’s more of a lifestyle thing. Some of these existing homes that you’ll have are just like neighborhoods. Right, there’s no, there’s no, there’s no facilities. There’s no facilities. There’s no amenities. Yep, no, it’s true, it’s true and, by the way, I still don’t understand it. Just let you know how, in fact, they’re doing so well, these home builders, even though I said all that.

0:17:13 – Frank Curzio

I mean the incentives they provide are much better. It’s nice when you have new homes that are selling for the same price as existing homes. So, again, a little bit less square footage. That makes it easier, because people are definitely going to buy the new home compared to the existing home with much more problems. And plus 2007, 8, 9, 10, I really covered the home builders.

These guys learned a lot, kind of like the technology companies during the tech boom, right the dot-com boom, where there’s a reason why their balance sheets are so strong. They don’t get very, very aggressive, right. They don’t get super aggressive at the wrong times because they almost went out of business. The home builders were close to going out of business if it wasn’t for bailouts, where they were able to carry those losses, I think, up to five years instead of two years. So the next three years, once they flooded the market with cash into the banks in 2008, in the credit crisis in 2009,. At the end of that year, in 2010, 11, those guys were making massive profits. They rebounded tremendously. So going through that, I think they learned a lot. And also providing incentives where you might be able to lower your mortgage rate and provide their own loans to get help, but I don’t know how that could continue. But that’s just one area I mean let’s talk about. You know, banks are on fire. This is you know personal to me what?

about cruise lines. I mean they’ve never seen business this good, ever Cruise lines.

0:18:26 – Daniel Creech

There’s a reason for that. They were bailed out too yeah.

0:18:29 – Frank Curzio

They were out of business.

0:18:30 – Andrew Horowitz

I was in my boat, I was fishing during COVID because what could you do during COVID? Right, couldn’t do anything. So I’d go out and we just out there and we get pretty close. We see all the um, the crew like kind of like you know, begging to talk to somebody because they were just bored out of their minds, but they were bailed out dramatically. Royal Caribbean, I think, had an all-time high last week or two weeks ago, whatever. It was amazing. I was always like the debt load is gonna kill them. How are they gonna come?

0:19:02 – Frank Curzio

They restructured their debt tremendously, which is great, and you know they came back for it because look at their competition. I mean you know how much it costs. It costs probably about $12,000 to bring a family of four to Disney right now. I mean it’s outrageous. Well, you can get like all-star, first-class whatever you call it service on a cruise for probably 20% cheaper than it is, especially with these hotels, where all the hotels you go to now in the major areas, you know you could pay an Expedia wherever you want. As soon as you walk in, they’re like oh, it’s $75 extra a night, it’s $50 extra a night as an add-on fee. I mean they just so now people are seeing these fees. Now I’m, I think, Airbnb, I’m staying in Airbnbs.

The banks too, which I get a little pissed off at this because I know that they’re pushing for more regulation. When you have Elizabeth Warren and, believe it or not, it’s the big banks that are lobbying for that, because the more regulation makes that moat just literally impossible to penetrate. You can’t. So you have these four banks the strongest they’ve ever been in history massiveive, hundreds of over $100 billion in sales, $30, $40 billion in profits just off the quarter. These guys are just positioned so well and so strong right now, based on the current laws, and there’s no one that could penetrate that market. If you do, you become New York Community Bank, which surpassed $100 billion in assets under management and put them in a certain class, required more capital ratios and the stock crashed because of it.

0:20:27 – Andrew Horowitz

That was just dumb. It’s amazing.

0:20:29 – Frank Curzio

So it makes you think like and I’ve been saying this for many years make sure you have at least one of those four largest banks in your portfolio. They’re going to pay dividends. As soon as they pass a stress test, what happens? They announce massive dividends, massive buybacks. It’s going to continue year after year. These guys are just full of cash.

0:20:44 – Andrew Horowitz

Well, you know, one great investor once said we probably have said this before but if reincarnation is true, I want to come back as a bank. You know banks. You know the Fed was created to save and to make sure the banks were always here. So you know banks are in great shape. Look what happened with the regionals recently. You know the regionals I mean the. So banks are in great shape. Look what happened with the regionals recently. The regionals, I mean a big part of the small cap index. We talk about a resurgence out of nowhere, just like July, the first few weeks of July, 10% in, I think, six days, the small cap market, but most of the small cap market is the financials and energy stocks.

0:21:23 – Frank Curzio

While the market was relatively flat, right. So it outperformed by its large amount in the history over that five-day stretch, right, and we see a little bit of pullback in overall markets, but still that outperformance is amazing. Here’s my theory. You want my theory?

0:21:34 – Andrew Horowitz

on this. Yeah, go ahead, I want to hear it All. Right. So this goes into the discussion of the housing market that we just talked about. So market during COVID, it was unbelievably interesting.

What happened, right, we had all these really expensive houses in New York, new Jersey, Connecticut, you know wherever, right, and people are looking down at Florida, saying Tennessee, Texas, saying let me get this straight, I can buy a house the same square footage or larger, maybe on the water, in a very desirable area, good weather, for half the price that I paid for this house here or that I can get for this house. They sold that house, massive amount of money and said you know what? I’m going to sell this house for a million dollars. This house that I could buy down here is beautiful for a half a million dollars, on the water, in this beautiful area, great weather, no taxes. It’s going for a half a million. I’ll bid it to 600.

Right, and what happened was what was fascinating this excess money that they just utilized by selling. They could just easily just say just pour it into there and it just pushed the prices up dramatically in Florida. And now that’s affecting us in a lot of different ways. Right, the whole inflation environment that’s going on here and just as expensive right now um, fort Lauderdale, most of palm beach, southern florida, south Florida just as expensive as pretty much anywhere else in the country. It’s insane right now. Yeah, um, that’s what happened last week or so. So there was trimming going on of Nvidia, Microsoft, Apple pick, whatever it is. But when we say trimming just a little.

0:23:07 – Frank Curzio

Yeah, they’ll say it’s like they lost a trillion-dollar valuation, even though they’re up like but where did that money go?

0:23:14 – Andrew Horowitz

But they have to be invested, these funds, they have to.

0:23:16 – Frank Curzio

That’s a good point. So what do they do? If they want to get fees, they have to be invested Right.

0:23:20 – Andrew Horowitz

They take this trimmings the junk fell off and they put it into the small caps. They look for a reversion to the mean. They look for an alternative investment. That has been so. The differential between the returns of large mega caps and small caps has been severe, right. So what they do is they put it there, but there’s not enough. So what happened here? They bulged the market. So I think what happened was the selling that took place to take profits on the things in these mega caps. There was so much money they were like just buy it at any price. I think that’s what’s going on with small caps.

0:23:54 – Frank Curzio

Yeah, and it’s interesting because someone who’s followed small caps my whole career, basically for 30 years, it’s.

0:23:59 – Andrew Horowitz

That was your first newsletter, wasn’t it?

0:24:02 – Frank Curzio

The reason, yeah, small caps. So the reason behind it is that they say is well, they’re going to lower interest rates? Well, that’s actually much better for large companies, right, because you’re probably going to see the dollar decline, and it’s better for profits overseas. Yes, so it’s not necessarily like you have all these risk assets because rates were low. Even when rates are low, large caps significantly outperform small caps right.

So yeah, just the reasoning is something that hey, let’s find a sector that has been really depressed. But I think, even looking at the Russell 2000,. It’s a horrible gauge. It’s worse than the Dow Jones as a gauge for the market because that’s price weighted. The Russell is not a good gauge for small caps. First of all, you look at 40% are not even profitable. And also it only rebalances once a year, meaning that Supermicro is in there at, I think, at $90 a share, and it went to what was it? $900.

0:24:48 – Daniel Creech

To $1,000, right.

0:24:53 – Frank Curzio

So the market cap was something like $50, $60 billion or whatever it was something like that, and it remains in that index the whole time. And even a company that has a $500 million market cap could go down to a $30 million market cap and it’s going to stay in that index the whole entire year. So I will look at small caps, not as the Russell I would actually look at. I’m finding lots of ideas, like you said, in banking and energy, in biotech, which has been annihilated and so many funds are so leveraged. Man, there’s so much for selling that you know. You look at the demographics, even for old, especially biotech, where you know, listen, we’re getting age right, age right, people getting older. We’re seeing AI especially integrated with that. With biotech is amazing Again, discovery from drugs a lot quicker, a lot cheaper. It’s not going to take, you know, whatever it is, 12, 13 years for a drug to come to market which costs over a billion dollars, or it’s a billion and a half. So you’re going to see all these things with biotech right now I’m seeing lots of opportunities.

But let me ask you this we saw a lot of news in the past week week and a half, okay starting on a political front and we look at what happened with Trump. So again, assassination attempt didn’t work out and now you see him, almost you know right now, the odds of him becoming the next president are very, very high Right now. You saw, just right now Biden drops out, which was kind of expected or whatever. Now, not to get political what you believe, we can have fun with this conversation, but does this change the landscape of anything, of how you’re going to invest going forward? Because it seems like the market has been adjusting a little bit, especially when it comes to crypto? The first pro-crypto president. He wasn’t pro crypto in the past, but he is now and clearly getting massive donations from the biggest ancient Harvard, yeah, but which came first? Wiggle was so, yeah, so regardless he’s, he’s speaking at the bitcoin conference right this week.

0:26:33 – Andrew Horowitz

Eight hundred twenty thousand dollars top ticket price yeah, for the dinner or something right.

0:26:38 – Frank Curzio

Yeah, for dinner, yeah and he’s gonna get that. I mean, he’s gonna get that pretty easily with that crew there. But now I mean, do you see a change? Because now it seems like, okay, he’s likely going to become the president. We don’t even know who’s running yet for the other side. Is there a change in, say, energy right, more drilling or natural gas, less on climate change, solar energy? Is there anything that you’re looking at that could change, or is it like hey, just buy good companies.

0:27:03 – Andrew Horowitz

So I think there’s two sides of this whole thing right With Trump. We’ll just stay on that for a second. I think there’s, you know, benefits and detractions, right? So the whole thing is that we talk about the energy complex, right? So, okay, you know less regulations, more drilling that help out the companies or does that hurt the companies? Right, in theory, we have more oil, oil prices go down, so that doesn’t really help certain companies but others. You got to be very specific of where you’re talking about, right? You look at, maybe, the banking less potentially banking, even the healthcare or biotech. Yeah, less regulations, less lead time, less, you know, red tape from a governmental standpoint. So there’s definitely things that will benefit. There probably are things that are problems too. You know what’s going to happen with the China trade. What’s going to happen with Taiwan? What’s going to happen with? You know, vance is a very much you know made in the USA, but also protect the USA. You know, screw everybody else.

I don’t mean that everybody else but you know, kind of like that’s their problem, not so much our problem. And Trump does oftentimes listen to the people around him, right, his ideas are the people around him ideas, so that may permeate some of the foreign policies. There’s a lot of very interesting things that could happen, may happen, you know. Is there a lot more upside in tech with Trump? Maybe again with regulatory environment, possibly with patent issues and things of that nature? Us built in the USA back a big issue also on that Tariffs, talking about 60 to 100% tariffs on Chinese goods, attacking that whole China, because you know what China is an easy punching bag during a political environment. But again, you know there’s a lot of things that are there. Nvidia made a big announcement they’re changing their chips to be appropriate, which is a big scam, right, you know, to sell to China, to make it legal to sell to China. Biden was talking about more issues, uh, issues with chips and importing and what can go where and what can go in into what deals. And um, does it change my thinking? I will tell you that what I’m feeling and seeing right now, and what I think we’re gonna is gonna happen, is a lot more emotions. Once again, you know, know, we’re in that four-year cycle and there’s emotions. What team am I on and what do I think they’re going to do? And I’m going to invest emotionally with that, without regarding facts, and I think that’s something that we’re starting to see.

There’s a lot of push and pull going on. Is it going to be good for this company, bad for that company? Is it going to be good for oil commodities? Is it going to be good for regulatory environment, et cetera? How’s our foreign policy going to be? What’s going to happen with EM versus developed Europe? I mean, Europe’s not totally thrilled. When they saw Trump the assassination attempt, Europe markets were not thrilled about that. They’re not happy about Trump coming in. He’s very disruptive, for good or for bad. And so, switching over to the other side of the unknown you know Harris, maybe, and we don’t even know a VP selection on that one, yeah, and we don’t know what her. Really, if Biden was in, we knew pretty much his policy. Do we say, okay, well, you got to figure Kamala, it’s the same right. I mean, it’s the same policies under her really hurt.

0:30:23 – Frank Curzio

So if Biden was in, we knew pretty much his policy. Do we say, okay, well, you gotta figure, Kamala, it’s the same right.

0:30:27 – Andrew Horowitz

I mean, it’s the same policies under her same exact thing right democrat republican that that that’s, yeah, it’s the same policy with her I’m not a big fan of investing because of the political figure inside of that government. I’m more concerned about the actual things that happen. You know, push pushback on EVs. Weird Musk is now supporting Trump, even though Trump didn’t invite him to all those meetings. Maybe he’s saying you know what, I figured this out Musk give him money and I’ll be in his favor. Maybe that’s what is going on with that $45 million monthly deposit that he’s making, and not only that, he’s gathering a lot of big heavyweights right and.

0:31:10 – Frank Curzio

Silicon Valley, which is surprising, is starting to support him as well, which is smart, right? I mean, you don’t want to go down with a sinking ship and maybe they’re able to turn this around, but if you see someone’s a clear winner, you want to be donating to that party, right, you want to be a friend of that party because that party, again, when it comes to politics and it comes, I mean, they can make your life a living hell, right? Especially if you look at the epa. What they could? They could basically shut down any company they want without any facts, right, and I’ve seen that done with mining companies. So, yeah, it makes sense. Where you’re going to see, like, everyone’s surprised that, wow, silicon valley is now supporting trip. They’re not necessarily supporting him because they like him. If he’s going to win, they’re gonna have no choice. You want to be his friend, right? Sure, and not be his friend just makes sense from a political standpoint but look at some of the people coming back.

0:31:49 – Andrew Horowitz

Did you see mike Pompeo? Did you see him on the RNC? Yeah, did you recognize him at first? No, I was like who’s that guy? No, I’m like, why does he say mike Pompeo? On the bottom he lost like incredible amounts of weight. Seriously, he’s like. He’s like totally I mean emaciated wealth from mike Pompeo. Yeah, I was like that’s not mike Pompeo, it’s not him. But didn’t he have a falling out in the end with trump?

0:32:13 – Frank Curzio

uh, yeah, I mean, so did several people. So advanced Vance was calling him Hitler and everything. Yeah, it’s all politics. Right, I mean these guys don’t care, they just want to get elected and stuff.

0:32:21 – Andrew Horowitz

So that’s the point though.

0:32:22 – Frank Curzio

I think the best thing with Trump right now is even before his speech at the convention. I just thought his speech wasn’t as great as it could have been. And for Trump, if I was him, I would do what Biden did. If you lock yourself in a basement, you’re guaranteed to win. The only thing that would get him in trouble is his mouth. So he starts saying climate change is fraud and, whether you believe that or not, you’re separating people right at a time when you could easily, during that event and what happened, to basically attempt assassination. It’s easy at night people right I’ve seen that firsthand during September 11th. Uh, you wouldn’t believe how it was down there a couple days later, which I was able to get rudy.

Just think about Rudy Giuliani and bush, but it was just the people just coming from every state, even other countries, to help out. I mean, there was just so much love there. It was just amazing unity. When you see something like that happen, it’s a chance to basically unify and I just think if he keeps his mouth shut he’s fine, but we know Trump is not going to keep his mouth shut.

0:33:20 – Andrew Horowitz

That’s not going to happen. That’s not happening. It should get interesting.

0:33:22 – Frank Curzio

But let’s get back to stocks here too, because we’ve seen a sell-off in some of these large caps and every time we see it, everyone gets worried, everyone gets worried, worried, worried.

0:33:31 – Daniel Creech

You got to watch it.

0:33:32 – Frank Curzio

NVIDIA finally sell it and 100% of the time, 100% of the time, it results in a buying opportunity because these companies, when you’re looking at an NVIDIA, this isn’t the dot-com era where this is going to happen this is happening. You’re looking at $24 billion in sales in a quarter they’re spending. It’s not like hold, this is. It’s not like AMD. We’re going to be an AI play. No, Nvidia is an AI play. So is it a chance to buy some of these names on a pullback? Do you wait, as a? You know, because you’re mostly with technicals and I understand you know some things have been broken and I know NVIDIA held this 50 day recently, but are you looking for more confirmation? Are you looking to buy these things on a dip? Because almost every single time these things pull back, people get nervous buying the dip.

0:34:18 – Andrew Horowitz

Well, here’s the thing that’s break in the last month or so. So I think people are getting a little bit concerned. We have earnings coming up over the next. What two, three weeks on this? Nvidia is a little bit longer out. We hold NVIDIA, Microsoft, google. It’s fascinating when you watch like an Apple right, which had an okay earnings report at best. But $110 billion buyback get to plenty of runway.

0:34:48 – Frank Curzio

It’s not even that much of a percentage of float To me. I liked Apple and we were able to really bottom tick that, and I’ve been wrong on other things before. But when you look at Apple, apple really controls the world. I mean they basically, just because they changed their privacy policy, they push Microsoft stock down 25%. Right, I mean not Microsoft Meta stock down 25%, but how do you view everything through their apps, right? So imagine they were like hey, you know Facebook and Meta, you know you’re no longer on the iPhone. What would happen to that stock, right? So? And now that they have all the pictures, now that they have all your videos that you’re to be able to talk to and say do this and change this picture and do this, send it with AI capabilities. I just I see where they’re going. And now the upgrade cycle, where it’s the first time I’ve seen Apple have again. I’m in the phone business as well. I own a store for like seven, eight years by accident.

0:35:36 – Andrew Horowitz

I thought you got rid of that.

0:35:37 – Frank Curzio

No, I still own it. I may look to get rid of it. I just don’t have to manage it. So it just kind of like the side thing. I have other kids managing it. But anyway, you never really needed to upgrade an Apple phone for, like you know, five, six years, right. And now there’s a need to because the 15 and the 16 are going to include AI capabilities, which is going to force this massive upgrade cycle, which is usually eight to 10%, maybe 12%. Now you’re going to see 20%. So I see where Apple’s going, I see where that stock’s going up. But others, you know, like Tesla, which you know we traded very, very well. But you know, I said, wow, this thing is really getting out of hand at how high it is. And now it’s pulled back. But there is a difference in a lot of these names, right?

0:36:12 – Andrew Horowitz

Big difference in a lot of these names. I mean, Microsoft has. You know, this is gold rush on what’s going on. I think that’s what is a reasonable way to look at what’s going on right now.

Gold rust was, you know, people went out there. Everybody’s got crazy and they all, just you know, got in their wagons and they went. They didn’t know exactly what they need, but they knew they would need shovels, they knew they need Levi’s, they knew they need something to sleep in. They know they’re going to need pans, you know, for a pan of gold, all this stuff. So NVIDIA is picks and shovels, right, that’s it. So it didn’t matter if a company gets it right with their AI. It doesn’t matter if you and I were out there and we’re doing our thing. You know, we got our whiskey bottles, we’re drinking that, we got our Levi’s on and you and I are shoveling our stuff and panning for gold and we don’t get any gold. But you know what? We bought all the stuff and we’ll continue to do it because we think we’re going to get there. So some of the companies that are being sponsored or created to have something I’m not naming any particular names, I’m saying in general right, everybody’s on the bandwagon. That’s the point. Not everybody’s going to have an AI that’s going to be generating. It may be generative AI, but it may not be generative profits of AI right, but they’re still going to be buying all these goodies to make it happen. Now, again, it may fail, and they may close it down, or whatever.

Look at some of the fascinating things that have happened, though. Why is this all happening? Why is Microsoft doing so? Well? Well, Microsoft basically took money off of their balance sheet. They gave it out to companies that are in the AI business. They may have taken little pieces of it, but basically said hey, here’s the deal. I’m going to give you a billion dollars, but you know what you got to come and do your AI gig and utilize Azure for the next three years and pay us. They took money off their balance sheet and converted it into income. Could you imagine going to your bank account, paying yourself or giving it to me? You go to me, you give me $100,000, frank, and you say I’m giving you $100,000. I go okay, what for Well, to invest for me, but I want you to give me back, and somehow I turned that $100,000.

0:38:26 – Frank Curzio

They’re not only making money off of the value of, like, an open AI increasing in value, they’re also getting money from the cloud, which is great, that’s great, that’s a great point.

0:38:33 – Andrew Horowitz

But that’s what they’re trying to do.

0:38:34 – Frank Curzio

They basically took their balance sheet and they converted it to income which is like well, it’s better than $110 billion buyback because it flows into your earnings numbers every quarter. Speaking of earnings, we always have this conversation where we get some ideas, have you noticed? Because, again, something that’s happened that’s never happened in the past is we see stocks pretty much near all-time highs before this 5% pullback. Yet we’re seeing the largest technology companies lay off lots of workers. When you lay off lots of workers, yeah, you can see earnings go higher, but usually you see sales stagnant, come down. Sales are going higher, earnings are going higher, margins are getting better.

You’re seeing this trend and it’s probably AI-related, where productivity is starting to surge with fewer employees needed, and it’s resulting in this earnings surge that earnings are expected to grow 12% this year and 8% next year. I mean on average, we could probably see 5% 6% over the past couple of years. That’s massive growth that we’re expecting, and do you see that happening? We always talk about this and we’re always off, because every time you say no, there’s no way these companies are going to generate earnings.

0:39:42 – Andrew Horowitz

They finally generate earnings right.

0:39:43 – Frank Curzio

It’s just incredible. You said something companies are going to generate earnings.

0:39:44 – Andrew Horowitz

They find ways to generate earnings right. It’s just incredible, yeah. But you said something I’m going to pull you from what you were talking about with the small caps. You said the Russell 2000 is a terrible metric for markets. Why? Well, because it’s a market cap weighted. So remember something the 12% earnings growth is on the S. We were at 39,000-something on the Dow and it kind of like went straight up. Remember, remember that it went strip. You know why? That was United Health, United Health. United Health was 550 points of that move because it’s price weighted. You don’t think somebody’s doing a little finagling with all these numbers? You don’t think that the computers are designed to buy all the massively big companies, the max seven or ten, let’s call the 10 largest stocks in the s&p 500, which I think are like I don’t know, 25 or so?

0:40:34 – Frank Curzio

of the s&p 500. Unless you have those stocks, there’s no way you’re not performing like you have like and you can see it through all the top hedge fund managers. But but that’s your earnings.

0:40:42 – Andrew Horowitz

That’s your earnings If you have big growth. I think some unbelievably ridiculous number of the earnings growth of the S&P 500, forget the NASDAQ for a second, but the S&P 500 over the last one year has been like NVIDIA.

0:40:58 – Frank Curzio

Yeah, it’s been and now you’re looking at a lot of catch-up where not so much Apple has been a lagger, but you’re looking at a lot of catch-up where not so much Apple has been a lagger, but you’re looking at and so is Tesla. But you’re looking at, Meta’s growth is incredible and so is Alphabet 30% growth they’re expecting. So you’re going to see, you’re right, you do see it heavily weighted towards some of these bigger companies.

0:41:21 – Andrew Horowitz

So, yeah, you’ll get that, but you may not get this. So the point not get hung up on this whole CrowdStrike thing, because they were part of this whole gig. There was actually some underlying stuff with Microsoft still being a problem, CrowdStrike still down another day, down 30% in the last few days, which leads to a whole discussion, by the way, the dominance of single companies in the whole tech stack.

0:41:41 – Frank Curzio

How can’t that? I mean that company, even now is trading at 70 times. So what earnings. You know they’re going to lose some of their customers. You know big fines of commerce and they still haven’t figured it out. I know because I flew that week. I got lucky, I got home with just an hour and a half delay but, and I flew home on Saturday for vacation with my family. But I could tell you I canceled no from from two days ago. I’m here, right, I’m back and, like your flights, cancel. If you need to change it, I’m still getting so. It’s still within the systems. I don’t know if that’s delta specific, but, uh, I mean some of the financials.

0:42:11 – Andrew Horowitz

I I personally shorted Netflix, uh, early morning Friday morning didn’t get a confirm. Oh really, wow, really Wow. I was 30 points in the money, 30 points yeah.

0:42:27 – Frank Curzio

I’m like, all right, you know, if that would have went through, you wouldn’t have worked out right, of course, of course.

0:42:33 – Andrew Horowitz

I’m like it still says pending. Why does it still say pending? I don’t understand. That’s interesting. I call up like said pending, so I cancelled it before the day was over. I’m like I don’t know what’s going on with this thing. Still said pending Sunday. Said pending this morning. I wake up it’s like cancelled. I’m like couldn’t. That was 30 points. 30 points was a nice trade yeah no, it’s crazy into earnings.

0:43:00 – Frank Curzio

Earnings were decent. They got the ad platform, which is good. That’s going to get rampant, probably in about 12 months, I don’t know, have you been watching Hulu on the ads?

0:43:07 – Andrew Horowitz

It’s so freaking annoying.

0:43:09 – Frank Curzio

Well, Hulu’s a horrible platform, right? I mean, Hulu’s always been Hulu’s the longest running streaming platform and it still hasn’t made money in like 16 years, I think 17.

0:43:25 – Andrew Horowitz

we bought, we bought it. We finally caved in to not just using a random email for the one month trial. You know talking about uh, and we bought it and we did. Okay, whatever I’ll do, whatever I said to my wife, I want to, I want to watch the bear, the bear. I watched the bear and which was terrible the third season, by the way terrible. I was so disappointed. But uh, it was like every five minutes it it was like another commercial, yeah, and you can’t skip it, you can’t record it, you can’t. You know we’ve gone from oh my God, how terrible TV is with commercials to oh, how great it is. Now it’s like wait, yeah, I thought the whole point was it was terrible, yeah, no, it’s just.

0:43:59 – Frank Curzio

I mean, I have YouTube and they just yeah, the commercials are crazy Like they try to feed commercials, I guess because they know everything that they’re tracking and everything. But it’s just yeah, it’s all over the place. It’s kind of crazy, but yeah, with streaming. So let’s get to some ideas here. So what are you looking at right now? Over the next, there’s so much uncertainty, right. What you see in good news, which is really bad news on the economic front because it shows the economy slowing. You know you have you have this CrowdStrike thing. You have earnings season at full play right now. Banks just came out, reported good numbers. The economy is doing okay. Earnings growth is expected. So how are you playing this market with individual ideas? Are you looking for small cap ideas? Are you focusing on larger names? Where are you going?

0:44:35 – Andrew Horowitz

So a couple. I’ll give you three different ideas. One is a general idea. We’ll just say the banks. Generally speaking, I think two reasons If Trump is going to win, that’s something that’s going to be perceived lower regulatory environment, less like regulations in the environment, which would be great for the banking industry.

You know they talk about, you know, getting away from some of the high, incredibly difficult levels of, like the Basel rules and all that stuff that’s gone on Mean reversion trade. I think there’s going to be, even though, if earnings come out and they’re good, there’s only so much we could see 40% increases quarter after quarter after quarter, even for Nvidia, by the way. Okay, it’s just there’s a limitation, but I think there’s going to be. You know, with the Fed, with the yield curve steepening, with the Fed perceived to be loosening, I think banks and regionals could be a good place. So, yeah, small caps are something I like, EM too, but it’s another whole discussion, you know.

I think if Trump gets in, the dollar will come down to value. It won’t be as strong for a variety of different reasons. A couple of things restaurants. So I think this, this generation that we have here, and even many of us, are accustomed to actually going out to eat as much easier. Even though so even though we just talked about how expensive it is to go out to door, door dash is on fall.

0:45:46 – Frank Curzio

I can’t tell you how many people use door dash. Holy cow, many people use door dash. I never thought.

0:45:50 – Andrew Horowitz

I never thought that yeah or any of those, or even the uber eats or whatever it is, but I ordered uber eats, I got a. I got a protein shake right one day. I’m like let’s get the protein shake for lunch.

0:45:59 – Frank Curzio

Just was it was it. Did the guy take a sip of it or no it?

0:46:03 – Andrew Horowitz

was like a $12 shake and I pushed the button to confirm. I’m like wait, how’s it $24? Yeah, I don’t understand what just happened.

0:46:11 – Frank Curzio

My daughter’s again, the young generation’s. Into that I’m like no, no more no more Instacart, no more nothing. Everything’s 25, 30% more. I’m like just yeah, tell my wife drive, just go, just drive Just go, yeah, so, but that’s it.

0:46:22 – Andrew Horowitz

So it’s also the restaurant. So I’ll tell you something I made. I had friends that have COVID and what I do every single time a friend has COVID or something like that, I make a big thing of chicken soup, chicken doodle soup for them. I went to the store and I got the chicken, I got the stuff, I got, I got the onions. I get to the thing I’m making it. I could buy them a chicken soup for like $8 somewhere.

0:46:44 – Frank Curzio

Right, you make a big soup and, if people don’t know this, we interview a lot on each other’s podcasts and Discipline Investor and you post all the time. You’re basically a chef and something you make this whole because I’m going to have COVID next week, just to let you know I make chicken noodle soup Probably around Tuesday, Wednesday, when my wife’s not cooking Wednesday. I’m going to be, I’m going to have to cook.

0:47:03 – Andrew Horowitz

I make a fresh chicken noodle I do like a roasted chicken noodle soup and I made like three quarts of it for them. I figured they’ll be in for a few days, I could eat that, so but it was $83. And now let’s take off. Let’s take off 15 or let’s take off 20. $ $63. I’m like, are you kidding me? I was shocked. And this is not at some fancy store. It’s at the store that I get all my good produce from and stuff like that. But it’s a cheap store. It is a very cheap store. It’s just has good stuff. So, um, but, but the point is that going out to eat is still, even to some degree, at a, at a reasonably priced restaurant, convenient. Most people don’t know how to cook anymore because you just push a button and grab it come home. So I like a company called Toast I don’t know if we’ve talked about this before.

0:47:47 – Frank Curzio

You gave that company away. I think you were on maybe a couple months ago and rocketed higher. It really did really well. So I think Toast is really great.

0:47:54 – Andrew Horowitz

The employees love it. The staff loves it because they get their own log. First of all, it’s easier to do a point of sale right at the table and deal with it right there. It comes up with you know quick, you know 18%, whatever it is, you sign, you’re done with it. You don’t have to think, you don’t have to like, sit there with all right, it’s a $100 bill and half of the $100 is going to be okay. So if $100 is going to do 15%, so I get a 10, that’s $10. Then half of the 10 is five, that’s 15. So if five, that’s 15, so 50, I want to go 18. It’s like more like uh, three, I got you know sit there the whole time. Oh, then I gotta add it all down and figure out if it’s right and take this is just click, click, click, sign, I’m done right. It’s great for the customer, great for the table turnover. Then it also has a back-end stuff that does for the management. It has um integrate so that the employees know where their tips are, what they have, what’s going on. Great system overall to, I think is great technology. It’s only getting better. By the way, efficiency for restaurants If prices are going up and restaurants are looking for places where they can save money. Well, it’s a definite higher cost to install something like this, but the long-term efficiency for the restaurant from the back end, the front end, great. So it’s a good way to actually long-term cut and manage costs. So I think that’s one um one thing we didn’t talk about.

If trump does get in, there’s an area that we didn’t talk about at all, which should be on everybody’s mind, which is defense, defense spending. True, you know, he likes he would like nothing better but to get into a big tank and drive it around, right, I mean seriously right, he wants to do that kind of thing he likes. I’m not comparing him to the Nothing better but to get into a big tank and drive it around, right, I mean seriously right, he wants to do that kind of thing he likes. I’m not comparing him to the dictators, but you know I’m talking about the that they walk out their missiles and do their army thing and show their strength. That’s a Trump thing. He’ll do that.

But you know where do we have defense issues? Well, we know the Lockheed Martin. You know the companies. I used to put Boeing in this, but Boeing’s in a different discussion right now. Right, yeah, we put all these companies in there. We know those companies right. What about the other side, the smart technology, the smart AI, defense related? What company is that? Took me a long time to warm up to this company. By the way, Palantir, Palantir, Alex Karp with the crazy hairdo. You know the evil geniusarp With the crazy Hairdo. You know the. That one’s got evil genius, but the the crazy genius.

0:50:08 – Frank Curzio

Yeah, listen to one of his conference calls. That guy doesn’t hold back. He’s pretty crazy.

0:50:12 – Andrew Horowitz

Yeah, he’s pretty crazy, so, but this is protection. This is AI for warfare that they develop. They have more data points and more information On things and stuff Seriously that can help that they develop. They have more data points and more information on things and stuff seriously that can help with leading edge offensive, slash, defensive. They also have the drones and things.

0:50:32 – Frank Curzio

It’s unbelievable what they have. Ai is such a major factor with defense. I just went to, you know, army War College, right, so it was a national security seminar and you know they have a special invite that I went there and they were talking about this and and even they like ai was a big topic there. But just the ai capabilities of making decisions where it’s going to be like if, say, if you know a terrorist is going to be a certain spot and you want to figure out when’s the best time to actually take them out, and it’s a big thing because you know there’s a lot of innocent people, right, it’s collateral damage. I mean, it takes a while where a fraction of a second through AI could you know, show you the outcome and tell you exactly, listen, do it this time, right, you know it’s. The capability of AI within defense is really incredible.

0:51:14 – Andrew Horowitz

And you brought to something there.

0:51:15 – Frank Curzio

It’s not just Palantir, there’s other names.

0:51:23 – Andrew Horowitz

I think a great think is fascinating, because they were really front and center and I got again great technology. I have people also in the industry that know what they’re doing and not from sharing secrets with me, but just know the levels of what’s going on and it’s pretty impressive and a lot of the stuff they do is they’re quiet yeah, I mean I, I’ve had a company on portfolio for a long, long time, work tremendously on is air environment, av, av.

0:51:50 – Frank Curzio

Oh yeah, which is another company, just you know, drone supplier. But I will. I will push back a little bit on this because under last time, under under Trump, we didn’t have any wars, and he’s talking about immediately on day one we’re going to get out of the UK.

So if you see that could that result in less spending for defense companies? Because I know that’s one of the things you know, Ukraine and Russia’s driven AVAV. You’ve seen Palantir, a lot of these companies where obviously Israel, Palestine, stuff like that. But you know, if we’re really going to have, you know, no wars of what he’s pitching again saying that no wars from a bow and arrow musket and all that I’m talking about.

0:52:28 – Andrew Horowitz

Also, what Palantir has is cyber warfare, cyber protection. They have all that going on too. So I just think that there’s a lot to be said about that whole environment, especially now that we’re looking at CrowdStrike striking, what happened there and the other companies that had Snowflake had a big problem. We’re getting like AT&T with a major breach. Nobody seems to care about this. By the way, is it only me that cares about the fact that there’s all these breaches and pretty much every piece of your information, not to mention messages, and God knows what else went with the AT&T? Does nobody else care?

0:53:00 – Frank Curzio

You know us care, you know. You know why you shouldn’t care is because every technology company has it already. That’s why you shouldn’t care. They have everything and I could tell you. If you don’t think so, I’m going to tell you this. You can even go the last apple update right. Apple’s always like oh, we’re great with you know privacy and stuff like that. They just triggered something that automatically they journal entries, so journal entries are shared with everybody all of a sudden, and it’s it’s the fault of the new update. And I tell everyone to get your phone, get go into settings, go into the journal park on securities and privacy, and you’re going to see it. And it’s green where. You’re like holy cow, never checked that.

0:53:30 – Andrew Horowitz

So basically, wait, wait, wait. What’s the journal? You’re talking about the journaling of the of like the almost anything that you put on your phone.

0:53:36 – Frank Curzio

Yes, I mean if you can go in, I’m doing it right now. So if you go to settings and you go, let’s get the old geezers going here.

0:53:41 – Andrew Horowitz

Yeah, so you go into privacy and security. Hold on a second Cancel Okay, settings.

0:53:51 – Frank Curzio

Okay, privacy security. Then go journaling suggestions Under J. Is it under J? Yeah, Journaling suggestions Okay.

0:54:02 – Andrew Horowitz

Okay.

0:54:02 – Frank Curzio

And it says discoverable by others. What does that mean? Is that green. It’s green for everyone right now, right? You didn’t know that.

0:54:08 – Daniel Creech

What does that mean? There’s a new update. So basically what it means Others detect you and nearby, help prioritize. Look at us.

0:54:14 – Frank Curzio

Look at us, their suggestion.

0:54:15 – Daniel Creech

We’re so old.

0:54:17 – Frank Curzio

We’re so old For those of you not watching and listening.

0:54:19 – Andrew Horowitz

we both put on Well others to detect you or nearby to help prioritize their suggestions. Yeah, that’s true. Who are others?

0:54:26 – Frank Curzio

Who are others yeah, I wonder who. I’ll tell you what you want to have some fun. And next time you go onto the website, everyone does it, nobody cares, right? It says we updated our privacy policies and everyone just clicks anywhere on the page, which means you accepted it. I want you to take the time and take five minutes out of your day and skim through through that and see what that says. You will be floored when it tells you that everything that we have, everything that you put on this site, we’re going to give to everyone in the world, basically, and that you know why?

0:54:51 – Andrew Horowitz

Because AI capabilities. Ai, that’s the large language models.

0:54:54 – Frank Curzio

Yeah. So basically, if you had you know your name is worth maybe 50 cents to $2 to $5, sometimes $25, depending on how much information I get. Say, if you, if I want a newsletter subscriber that’s buying stocks in my portfolio and they’re going to be interested, I’m going to pay more money for that lead. With AI now that lead is worth $25 to $50. It could be worth $100 because you’re going to know every single thing on that person and be able to, pretty much through inference, figure out what they’re going to do the next minute, the next hour, the next hour, the next day, for the rest of their lives. Right, so that now there’s such a.

That’s why, if you look at Reddit, reddit is the shittiest company. It’s the only Internet company in the world that I’ve seen in 20 years that hasn’t generated profit. Right, in 20 years, through all the cycles in 20 years, I haven’t done it. Now this stock’s going higher. Why? Because they have all these names, are taking all the data and just give it to, and people will pay a fortune for that. So having a list is much more valuable today than it ever was. But private policies, man, just be careful. I mean even Apple, right? Apple’s supposedly like we’re the best.

0:55:51 – Andrew Horowitz

But nobody cares, Nobody cares. For years we puked this information into Facebook, right? Everybody’s like hey, look what I’m doing, and I still have friends that every like.

0:56:00 – Frank Curzio

The funniest thing is people get pissed off at it.

0:56:01 – Andrew Horowitz

They get pissed off everything they do every day yeah, everything they do.

0:56:03 – Frank Curzio

Listen, I’m right here. I’m checking in right here at this second and look and on vacation right here.

0:56:08 – Andrew Horowitz

Look what my family or there’s something that happens like 3 000 miles away. I’m safe, I’m safe, I’m like it was an earthquake in Indonesia.

0:56:19 – Frank Curzio

You know you’re in Florida. You can’t post on these social media sites and get pissed off that they’re stealing your information, especially when you’re giving your whole life away to them, right, this doesn’t make sense, but all right. So we covered so many different things and so many ideas. Love having you on the podcast so you actually run money, right, yeah, uh, and tell people all about it Anderson Harwood’s, because you do have this investment podcast, so I’ll be familiar with so, uh, tell them about uh, so, yeah, you can go over to The Disciplined Investor thedisciplinedinvestor.com.

0:56:46 – Andrew Horowitz

We have three different strategies. Two are a little similar. One is like a global allocations, which is a $500,000 minimum, but we also created a junior version of that called Investology, which starts at about $10,000 for anybody Pretty much affordable for anybody. It’s a global allocation, it’s not an individual stock. It’s a global allocation, it’s not an individual stock. It’s more.

You know, we’re looking at where your risk is, where your time horizon is what we want to do, where we want to be right now. We want to overweight EM, emerging markets. We want to underweight fixed income, depending on what your risk is. We want to be, you know, more value, more growth. I mean, we move things around right.

So we moved into commodities from gold and silver and that was, a few months ago, up really nicely in that because oil. We did it because we wanted more oil in the portfolio. It was at 72 at the time. Now it’s at I don’t know, 81 or something like that. Then we have our global allocations and then we have our managed growth strategy. Individual names the ones I talk about, by the way, full disclosure, toast, Palantir and Banks are in that strategy. We go long, we go short, staying away from the short positioning, because the short positions can be a day and then they just go back up. So it’s impossible right now when there’s so much money seemingly chasing things from, whether it’s sovereign wealth funds or stimulus or everybody just saying you know, stocks always just go up over time and, like you said, when they correct for 5%, then you know, the Tesla went from 140 to 250.

0:58:07 – Frank Curzio

I love that it went 140 because expectations was so horrible and everybody hated it Horrible. But then it went to 250. When they’re lowering prices, China’s bad their production is going down. China’s horrible Production’s down 6%. They beat the numbers. It’s down 6% year over year. So you see the numbers decline. Margins decline because they’re cutting prices down 6% year over year. So you see the numbers decline. Margins decline because they’re cutting prices. So if you can’t make money on something like that, when Tesla goes to 220, 230, goes all the way to 250, 260, it’s very hard. Shorting is a tough time.

0:58:36 – Andrew Horowitz

It’s tough right now. There’ll be a time. Oftentimes that happens you get faked out. Like I said, I shorted the home builders for like two days. I’m like you know what? I’m not doing this. It doesn’t feel right, it doesn’t look right. No, it makes sense Right now. You got to be. You got to be more patient. Everybody’s still thinking.

I think again, the big picture is, there’s always these narratives and, by the way, just to finish this one point up that we talked about, you know why are people buying right now? The Fed has done a great job of holding a carrot in front of all of our noses, convincing us all that a lower interest rate is really good for the markets. Right? They keep on going back and forth. How many times have you seen this guy say you know what? We think we got our goals, but we don’t want to go too fast? Like seriously, somebody comes out cash carry, you know what we may have to raise rates. Somebody else the next day, you know what we may have to lower rates, what you know? The Fed comes out with a harsh statement Markets don’t like it very much. Two days later, they’re like well, you know what. Things are much better now.

0:59:43 – Frank Curzio

Like they’ve been masterful. It’s hard when you have that. The worst thing that ever happened when it comes to our government is the credit crisis. They made money on everything. They bailed out Right.

0:59:50 – Daniel Creech

So you knew they were going to go both ways Maize and lane.

0:59:51 – Frank Curzio

They just didn’t bail out during COVID. I understand that Everybody understands that you’re locked down, was at all-time highs and you spent three four, five trillion after that and went nuts after that.

And that’s why you see in market conditions that don’t make sense to a lot of people, because when you throw trillions into the market, that’s what happens. So it should be interesting to close the year. Definitely love to have you on again Discipline Investor Podcast see more of Andrew. You can, by the way, if you want discounts there, give him a call and talk about cooking or boats and he’ll talk to you and be like oh, I only have 400,000 for this special account. He’ll be like sure, you can come in, no problem, that’s great.

1:00:32 – Daniel Creech

All right.

1:00:33 – Frank Curzio

Frankie, Great having you on. Love you bud. And.

1:00:35 – Andrew Horowitz

I’ll talk to you soon All right, bye, all right.

1:00:39 – Frank Curzio

Great stuff from Andrew. Love having him on, close friend, smart, know he cares, going everywhere. I can’t tell you. It feels like I say that often but you can’t really go everywhere with a lot of people that have general knowledge and really smart and everything. Those are like market junkies, like a Petrides, like a Horowitz. I have several other guests that I can go in different places where Rick rules more like commodities and stuff, and some people specialize in banks or analysts and stuff like that, or you know, economists, and you know having that transparency where you can go anywhere, it’s really cool because it often leads to more ideas. It also leads to lots of more emails and people talking more and say cause? Some people are interested in the economy, some people are interested in equity, some people are interested in bonds. Right, I mean the audience. We have what? 16 million downloads in over a hundred countries. So you know everyone has different preferences and the more places we could touch up on, especially since all this is part of the market right now. There’s so much news. You know, just Andrew makes for a very, very good guest and I wanted to have him on Going forward, probably gonna have Charles Payne on on Fox. Wow, so happy to see his success.

I was on TV with Fox with him 15 years ago and we were both very big guys then. I think we both lost a little bit of weight and we used to sit on the couch and make sure we sat on different couches just so we didn’t look like two big guys just sitting there. We used to go on early in the morning. And now he has his own show and, man, he’s just doing fantastic and he’s out with a new book. So he just confirmed me with Fox. He reached out. I reached out to him and he confirmed and said yeah, it sounds great, just going to. You know, reach out to Fox and make sure that it’s okay, which it usually was in the past. But again, any interviews you guys want to hear, let me know, send me an email at frank@curzioresearchcom.

And Wednesdays I want to dedicate to more and more interviews. I’ll try to book one every week. If not, I would say at least two a month. Try for three a month. And yeah, I want to get some really good guests on here. Guests that challenge me don’t have the same thesis Again, you want to learn, you want to get it right. That’s the goal, right talk to people who have a different opinion than you. So the interview is going to be good. They’re in-depth.

I love to do interviews. I think people love it as well, because they have a 45-minute to an hour platform to really share their thoughts and they’re not cut off in a two, three-minute interview and being asked to explain difficult topics and inflation or deflation, what the Fed is going to do, and a lot of the hosts, especially on TV, like talking more than listening, you know, and it results in very poor interviews. I see in the media, sometimes With us, you know, we get in the platform, I ask questions and I shut up. I want to hear them, so you know if you have anyone on that list CEOs, people who are industry specialists again, we’ve done heads of state, economists, billionaires We’ve been doing interviews for over 15 years on this podcast. So because of you, because of our big following, we’re able to capture a lot of great people, because they see demographics, they see how many downloads, they look for a track record and, again, we have no strikes on a license or anything. So we have a very reputable brand and people love coming on and doing these interviews.

Have a very reputable brand and people love coming on and doing these interviews and, plus, they’ll call their friends and say, hey, if it’s Kramer or Muhammad Al-Aryan or whoever throughout the industry, and they’ll say, hey, how’s Frank Curzio? And they’ll all say good things and say, yeah, this guy’s awesome and he does great interviews. Because I’m passionate about it and I want to learn and I really do the research on these people before I have them on because I don’t want to ask them questions that you’re going to hear on TV. I want to try to challenge them in other areas and see some of the things that they say what industry they’re in, what stocks they like, why they like them and really dig into their thesis and stuff like that, because I just love learning new models and listening to someone’s thesis and breaking it down and stuff like that. Again, it’s just fascinating because everyone’s brilliant in certain ways, even in my industry, so I can always learn something and hopefully that translates into you guys learning something. Anyway, so great stuff from Andrew. Love having him on and let me know if you guys want me to interview. Let me know how that interview went. Frank@curzioesearchcom. Now.

Quick note before I leave so next week I’m going to be holding a live webinar. It’s the third series in our Crypto 2024 event. If you haven’t attended the first two, these events are really really good. They’re totally live, they’re free. We got a pretty big audience for our size company and we do a Q&A afterwards and that’s live as well, and the Q&A happened to last for an hour hour 15 minutes. It sounds crazy when you’re on it, but everyone’s asking questions and those questions are really good. We give away lots of ideas. We talk about different specials that we offer for our newsletter, of course, but they’re really in depth, and this is going to be the third series and I haven’t said this before other than about two, three weeks ago.

I believe Bitcoin’s going to 100,000 this year and I think it’s going to surge past that. There are major, major catalysts right now and tailwinds that you know. These aren’t the traditional tailwinds. They’re different from what I told you, where, okay, you got the halving and stuff like that and Bitcoin, more people getting in institutions, etfs. This is different. There’s a lot of catalysts on the table right now that are all going to come to fruition within the next month or two, and five of these catalysts will be exactly on the mention. I’m going to talk about them in detail.

It’s not going to be a long presentation I’ll get right to it, but I’m going to also share my favorite crypto ideas with you. Names that can go up 5x or more in 12 to 18 months, just like they did the last time when we had the Bitcoin halving. It’s only three months ago. Usually, we see Bitcoin soar. When Bitcoin soars, the rest of the market usually goes up tremendously, which it hasn’t done yet. I thought it would happen. It hasn’t happened yet, but it is going to happen and it goes up. Well, if you look at the rest of the crypto market outside of Bitcoin, it goes up three times more than Bitcoin when it surges over the 18-month period.

But this time we are going to see an acceleration in crypto that’s going to exceed even the most bullish of forecasts, and I’m going to help you capture some of these gains, gains that could be life-changing. I know you probably heard that term a lot. Right when people say, well, it’s life-changing gains. Crypto made life-changing gains for me. Okay, I’ve done well in this industry. I’ve done well. I don’t have to work if I don’t want to. I love doing this. I love helping people, the reason why I have a beautiful house in one of the nicest neighborhoods in Jacksonville is because of crypto. It was life-changing, with the gains that I made in this sector.

When you see a bull market in this sector which is coming and it’s going to come and it’s going to surge you got all these I’m telling you tailwinds behind Bitcoin right now are going to surge, especially I’ll go over the catalyst with you during the webinar the gains that you see during bull markets and I’ve covered bull markets in different cycles when it’s mining, when it’s biotech and mining. People love junior miners because if you get the cycle right which happens once every three, four, five years, and unfortunately it hasn’t happened in like 10 years, 12 years in that industry you could see 2X, 3x, 4x, 5x gains In crypto. The gains that you normally see during these bull markets are 50x to 100x. You can go back and look for yourself. You can go look at the top 100 cryptos and just look at when they came out and look at when Bitcoin hit highs and you’re going to see many of these things have gone up 10%, 15%, 20%, 100%, and now we’re looking at the best names that have sold off, even though Bitcoin has been holding in doing very, very well. You know it’s off its highs, went into the 50s. Now it’s in the 60s, back up, I think it’s going to go right to 100,000 before year end and probably a lot higher than that in 2025.

You’re going to see a lot of the good names which are down a lot, where you’re not going to have to take risk on these crazy, stupid memes and crazy coins which, if you want to do, you do. Some of these things have gone tremendously. People have become very wealthy because of that. But even the best names with the best utility features, things that are disrupting the financial markets right now, which is going to come starting 2025. You’re going to see, now they have the technologies and in in the US it’s been a little different. You see a lot of these technologies and people launching their own coins and new technologies. Again, these are basically software companies. They’re launching them overseas because of the regulation. That’s all going to change.

That’s one of the catalysts I’ll give away, which you all know is Trump is pro-crypto. You’re going to have someone there that’s going to provide regulation where trillions of dollars is going to come into this industry. People are going to start crypto companies here and the banks are going to accept them. That’s a whole different level than where we’ve been with the previous administration. That’s just one of the catalysts I’m sharing. These names tend to go up tremendously Again 50X to 100X. That’s not bullshitting you here. You can go in and do the research yourself to see some of these gains that you see in these names when you have a bullish cycle in Bitcoin, because they outperform Bitcoin at least three to one on average, but a lot of them even higher than that. So I’m very bullish. You don’t have to take my word for it. You could listen to some of the top names in the industry that haven’t been crazy bullish, which is Mike Novogratz, Winklevoss twins Remember, these guys used to be Democrats.

Now they’re all jumping aboard. They want because they run their companies in an industry that’s going to be pro-crypto if Trump wins the election and Trump is leading. Trump is leading. Right now, democrats are kind of have no idea what’s going on Channels yeah, Biden just dropped out Again. It looks like the odds are is that you’re going to have a Trump presidency and he is pushing crypto. He’s even speaking at an event this week later this week at the Bitcoin event and he’s probably going to provide some framework and that’s what these guys want. No regrets.

Winklevoss twins, anderson Horowitz Anderson Horowitz these guys billionaires. And also Larry Fink yes, we know he launched ETFs. He manages over $10 trillion. You should have heard him. If you haven’t heard, on CNBC, this is about a couple of weeks ago. All in on Bitcoin.

Remember Bitcoin is crypto, it’s not just Bitcoin and Ethereum. Bitcoin and Ethereum is surging. You have all the Ethereum ETFs coming out right. They’re just starting to launch now. You’ve seen lots of inflows. Now, when you’re looking at Bitcoin going higher, ethereum going higher, this opens the door for the whole entire industry. It’s like Exxon surging to new highs. You’re going to see a lot of energy producers do well. The whole entire industry does well.

Usually, when you see a bull market in an industry, it’s the names way down on the list that are going to show you the biggest gains, just like when you see it on a downturn. The largest company usually goes down whatever 10%, 20% but the more aggressive name is going to go down even more and underperform the market. But on the way up, they outperform the market significantly and I’m going to show you how. So much so that I’m going to put another $100,000 of my own money into crypto and I’m going to share some of those names right now in our crypto intelligence portfolio. There are 14 names 14 names that are currently buys in that portfolio, and this is what I do. I like to get you in when it’s a great opportunity for crypto.

Right now, we’ve seen crypto pull back a little bit more than expected, but now, with these catalysts coming, it’s very exciting. So I’m launching this. I told my team listen, we’re doing this next week. Okay, next week. It looks like August 1st Thursday. I’m going to confirm that date early next week. If you’re on our email list at Curzio Research, we’ll definitely notify you. I’ll also be talking about it on the podcast. If you’re not on the list, go to curzioresearch.com, put your email in at the bottom of the page. Then you’ll opt in, where we’re not going to send you millions of emails, but you’ll get free reports that we offer, free research, free write-ups, updates on special offers for our newsletters and also notifications on our upcoming webinar events. So again, 14 of those names are strong buys in our portfolio right now. I’m going to share some of them with you during the webinar event and again, it’s 100% free.

Usually it’s a 15-minute presentation. Sometimes it might go a little bit longer than that, and then we do a live Q&A and we’ve stayed on. I’ve stayed on for an hour, 15, hour, 20 minutes. We do it pretty much. I think we start like whenever six, seven o’clock, and the reason why I stay on is because we can monitor how many people are still on the call and a ton of people like 80% of the people usually stay on and they’re asking questions and it’s a lot of fun. And yeah, and it is live.

So live is I don’t care, we make a mistake, you can call us out on it. It’s really cool, but everything is live, which you don’t see in these events. I don’t know if anyone does them like 100% live. Sometimes they do, but a lot of people like to tape these things with me. We make a mistake, we make a mistake. That’s cool, it’s part of the job and we’ll just keep flowing. But you know I’m not just reading off a prompter and a script and just telling you, because I know a lot of this stuff like the back of my hand. That’s why I’m investing in it. Right, and sometimes you don’t see that in this industry, where you know, our live webinars are really, really cool.

Hopefully, a lot of you would join us. If you haven’t, again, you can join us very easily. We’re going to send you a link. We’ll have it on our website pretty much the next couple of days, but right now, 10 of the day. It’s going to be Thursday, august 1st, and definitely, definitely, if you could 10. It’s for free. You don’t have to purchase anything.

I want you to buy that newsletter right now because I think you can make a shitload of money off of it, and that’s how we do well in a newsletter business, because if I make you money, you’re going to subscribe to more of our products. It’s that simple, right? So what I want to do is, if you’re coming in, if you never bought one of our products, or if you’re coming in you did and we’re able to make you money off of it, then you build that trust factor. It’s a will do it for five years or seven years and eventually burn their clients out with us. I like to offer certain deals at certain times when I think you’re going to make the most money. This way, you build a trust factor and you become a client for life, which is what we want. Again, that’s why I’ve been doing it for so long.

We have such great contacts and a great podcast. So, if you’re interested, definitely attend. You’re going to see more emails coming out on it. If you’re on an email list and we mentioned on the podcast again, get on an email list. You can go to curzioresearch.com. So, guys, that’s it for me. Thanks so much for listening to the podcast and the interview. Questions, comments. I’m here for you, frank@curzioresearch.com, and I’ll see you guys tomorrow on Wall Street Unplugged. I think you’ll really love Wall Street Unplugged Premium.

The Wall Street Unplugged Premium is my members-only podcast where I dive even deeper into this week’s events, where I’ll do even more than tell you what’s moving these markets. I’ll tell you specifically what moves you can make today. So this is going to be about trading. Put big money in your pocket right away. Due to the inconsistencies I see daily in the market, I’m talking about specific investment ideas. I’m recommending and tracking each week that I believe will be impacted directly by everything I just talked about today. Plus, you’re going to get the chance to go even further down the rabbit hole with me and my co-host, who’s Daniel Creech, as we discuss which of these week’s trends could turn into massive windfalls the big trends that we see lurking on the horizon. Also, the news we’re picking up from our network of insiders, which has gotten bigger and bigger, thanks to you and so many people listening to this podcast in over 100 countries.

And you’ll get a chance to talk to me directly in my special Ask Me Anything Q&A session. And you’ll get a chance to talk to me directly in my special Ask Me Anything Q&A session. All that and a lot more, like premium interviews with world leaders in finance, technology, industry and politics. This is all part of Wall Street. Unplugged Premium and becoming a member is super simple and super cheap. So head on over to WSUOffer.com to check it all out. Sign up today and you won’t miss a thing. That’s WSUOffer.com to check it all out. Sign up today and you won’t miss a thing that’s WSUoffer.com.

1:15:50 – Daniel Creech

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