Bizarro World Podcast,
with Nick and Gerardo
Nov. 7, 2022
Gerardo Del Real: I am mining investor and editor of Resource Stock Digest, Gerardo Del Real, here with my partner, Mr. Nick Hodge, who's an investor and publisher of Daily Profit Cycle. This is our weekly therapy session we call investing in Bizarro World, where we talk about markets, what we're investing in, and all of the crazy stuff going on all around us. This week we're going to talk about Jerome — Jerome, Jerome, Jerome. Jerome has spoken once again and, oh, did he speak. We'll talk about the effect that had on the US dollar. We'll talk about the most inverted yield curve in 42 years, what that means, and why that's important.
We'll also talk oil, Iran, Saudi Arabia, Quebec, a big lithium win for Nick, Capitol Police, Elon, a lot to get to. Let's get to it. This is episode 193 of our therapy session that we call Bizarro World, investing in Bizarro World.
2:21 November Fed Meeting: Dovish or Hawkish
7:43 How to Invest & Analyze Lithium Stocks Successfully
15:15 Will Dollar Strength Continue?
17:04 Lithium Stock Earnings
20:27 Where Are Oil Prices Headed?
25:08 Elon Shakes Up Twitter & Blue Check System
33:02 Paul Pelosi Attacked
38:29 National Catalytic Converter Theft Ring
Gerardo Del Real: Mr. Nick Hodge, how are you?
Nick Hodge: I'm doing well, Gerardo. It's good to be back again — this week without a mask. How are you?
Gerardo Del Real: We all wear masks, Nick. Sometimes we wear a literal mask, sometimes we don't. But deep down, we all wear a little bit of a mask. No, I am well. How was Halloween for you and the family? I saw your wonderful outfit, your beautiful family. You all looked incredible. You were particularly dashing.
Nick Hodge: Oh, thank you. I was the bearded lady. We had a circus theme going on. My wife was the ringmaster, which isn't too much of a deviation from the truth. And then, our three kids were traditional circus things, Tigers, and elefantes, and clowns. How about you? And lots of candy. Too much candy to even steal from the kids. There’s a dentist around here that I think you can trade it in for cash. I think we might do some of that.
Gerardo Del Real: That's hilarious. It was a phenomenal weekend. It coincided with my birthday weekend. So, Halloween debauchery all weekend long. It was fantastic. The kids had a great time and it was great. Wife had a great time. We enjoyed all the festivities the whole weekend. It was great.
Nick Hodge: Happy birthday, sir.
Gerardo Del Real: Thank you. Thank you. Hopefully, a year wiser. We'll see. Let's get into it.
November Fed Meeting: Dovish or Hawkish?
Jerome spoke, then he misspoke. And now everybody's trying to figure out what Jerome said. I'll give you my quick two cents. I think he meant to sound a little hawkish and then it came off as dovish. And then I think somebody whispered in his ear, "Hey, you're coming off as a little dovish. Everything's rattling." And he said, "What?" And he was like, "I'll show them at my press conference." And then, he overdid it a little bit, right? And that's my very educated technical take on the speech.
Nick Hodge: It's as educated as my take is I'm not a huge, huge Fed watcher. I obviously stay in tune with the rates and what the market is pricing in but he's got wings. I don't know if they're hawkish or dovish. I'm not sure. So, there is no pivot, which I told you, there was not going to be. It wasn't half a percent. It was what the market was pricing in still, a three-quarter percent rise, 75 basis points. As you say, the market whipsawed, which it's done before. Everything was up, and then everything was down for the reasons that you say.
The press release turned markets around. I think there's going to be more rate hikes. And so, this is what I wanted to say, not get off my chest, but I continue to say that it's not a pivot.
Gerardo Del Real: Go ahead, Nick. Go get the dirt off your shoulder, right?
Nick Hodge: Yeah. Even if it goes to half a percentage point in December and then again in early 2023, the Fed is still raising the interest rate, whether it's by three-quarters of a point or a half a point. The trajectory is still and the market is still pricing in, the forward curve is still expecting at 5% interest rates on the short end. And so, you're going to have to deal with that still for a little bit longer. And you still have very strong employment. So, I think the Fed thinks that it can continue to hike. We'll get a jobs number that'll be out before this podcast is, early next week, and we'll see what that jobs number looks like.
If it starts to look a little negative where the jobs have been looking positive, the market might take that as dovish. Because they're going to say, "Oh, look, the job market is eroding or deteriorating, and that's going to make him be more dovish in the next couple of meetings." But you mentioned the inverted yield curve. The two-year yield is 5%, Gerardo, right? The inversion is almost a full percent. And so, you do still have a recession to work through. Now, all of that said, time is just elapsing. I see investors getting less bearish and I see sentiment starting to improve.
But I want to reiterate that it's not because the Fed is going dovish. It's just because time is elapsing. The Fed has raised rates like they said they were going to raise rates. It's just a time-lapse thing. And so, here we are in the first week of November, and there might be some things to buy here headed into the end of the year, not only in the resource space, which is exceedingly cheap, especially on the gold side. You had bad earnings out of Newmont (NYSE: NEM), which put another leg down. You can lock in a yield on Newmont that's over 5.5%.
I found myself entering bids for Gold ETFs this week, the miners. And the same on the uranium front. And I know I'm spanning a lot of topics here now. But all that to say that the Fed is still hawkish I'd say in the market pays, perhaps, a bit too much attention to it.
Gerardo Del Real: Listen, we were in New Orleans, what's now over three weeks ago I think. And we told everyone then. You specifically said the Fed could be hawkish for another four to six months. And a part of my presentation, our presentation, my portion of it really spoke on how long are you willing to just wait for the Fed to pivot before you feel confident enough as an investor or speculator to allocate capital. And again, it's beyond me. We published the newest issue of Junior Resource Monthly which is one of my paid subscription services.
And I keep pounding the table on uranium and lithium. And it's just beyond me, when you have sectors that have such bullish fundamentals, why you wouldn't allocate capital there as opposed to just waiting until Jerome tells you it's okay again. Because something may seriously break before it's okay again. And in the meantime, you have sectors where you don't carry that macro risk. The lithium trend isn't doing a 360 anytime soon. The uranium fundamentals aren't all of a sudden going to get bearish.
Those are trends that are years in the making, from a very bearish baseline, and now provide you years of bullish runways. So, again, there's sectors to invest in. I keep saying the same thing every week. We keep profiting from it every week.
How to Invest & Analyze Lithium Stocks Successfully
You just had a big win in Quebec with a lithium company. You want to talk about that a bit?
And I bring it up only again, not to be a braggards or to keep pounding our chest on the wins that we've had this year, but just to highlight that despite the gloom and doom that everybody's pitching you, there's a lot of money that has been made this year. And we've been fortunate enough to capitalize pretty damn well from those trends to offset some of the picks that haven't done the best in the gold space specifically, right?
Nick Hodge: Yeah, it's a company that was awaiting a provincial permit. So, it was a company that had already drilled out their deposit, which takes years by the way, which is one of the reasons that the lithium bull market is going to last for years. I had originally financed it back in August of 2020 or summer of 2020 at C$0.30, watched it run all the way up to C$1.50, made some 400%, sold some, took some off the table. Got back in when it fell back down closer to $1. And then, it got its final provincial permit this week from Quebec. So, it's a deposit that has over a $1.5 billion net present value and the shares were trading with a $400 million market cap.
And when you look at it next to some of these companies that have gotten really big valuations as they head closer to production and development like the Sayonas (OTC: SYAXF) and the Sigmas (NASDAQ: SGML) of the world, it had a lot of room to go up and honestly still does. So, when you look at it based on those multiples, what they're getting relative to their NPVs, this is a stock that we've already made several hundred percent on. It's a larger position for me because of how much I put in the financing and because we had warrants that I exercised as well.
What do I want to say? It's very clean lithium I guess is what I would say. Very low mica content, very low iron content, small crystals. And all this is coming from an education I got in the past week from the president, who I spoke with at length about the project who, by the way, sold his last lithium company for $6 billion with a ‘B’ to Albemarle (NYSE: ALB). That was Rockwood Lithium. And so, he's very excited that this project is not only going to be producing 5.5% spodumene concentrate but 6% technical grade spodumene with high recovery rates and that fetches a premium.
So, he's convinced this mine as it gets built is only going to be one of two or three mines in the world that produce that high-grade technical spodumene concentrate. And he would know, right? Because one of the last assets he sold was one of them, that he sold to Almarberle. And he was very coy. I talked to him literally three days before they got the permit and he was telling me, smiling, we're waiting for the permit on an hourly basis. But he was also pretty happy when I was asking him about who's at the table. Because now they have to finance this thing.
Gerardo Del Real: Everybody.
Nick Hodge: Right. And so, that's pretty much the answer. He was even talking about some major international industrial companies, ceramics and glass manufacturers that I really am not familiar with, like Schott for example. I had to look that company up. And so, anyway, it's very exciting. And again, when you look at the comparables, when you do the math, which I did in a report that I mailed out today, you can see a path for this stock, which is around $2 now to get to $7, $8, $9, $15 — based on valuations that other companies are getting. And, as we mentioned last week, exploration upside as well, which he was keen to point out to me.
They released some results recently. They've got a very large land package in Quebec and not just the project that just got approved but 40 kilometers away in the Namasket area. So, yeah, I'm not going to give you the name because we're going to be doing some advertising around it here soon. But the lithium market's not going away. Look, this is a project that they've been plugging away at for years, right? I mean years and years and years.
And so, if you look at all the stats that we frequently cite, Benchmark Minerals saying that we've got to increase the amount of lithium we mine 25x by, I forget, 2040 or something like that.
Gerardo Del Real: 2040.
Nick Hodge: Or that in 2040, we're going to be using as much lithium every month as we mined in all of 2021. All these stats, right? It's like, well, good luck because I've been involved with this project for two years and it took a year to get a provincial permit. And so, it takes time and the price is extremely elevated and so, thanks for the kudos, I guess, we took a tiny bit off the table but there's still a lot to go. And we'll see how much equity they actually have to put up to build this mine. That's the next catalyst.
Speaking of doves and hawks, I'm pretty sure there are some birds circling that are going to want to give this company some capital to help them build it either as part of an offtake or a strategic investment. So, we'll see how that shakes out. They might not have to dilute too much to get this project off the ground.
Gerardo Del Real: Kudos to you because I'm sure shareholders want to give you kudos. You financed this in the low C$0.30s if I'm not mistaken. It just hit 52-week highs. It's hitting 52-week highs while other companies like Meta (NASDAQ: META) are down 70% for the year. It's hitting 52-week highs and looking to finance a project that's got great exploration upside. And you mentioned something very interesting, the variety of companies that are approaching companies like this company to help finance these plants and this mine. And I think this particular company and where it's located is going to find offers that are incredibly non-dilutive and accretive.
I think that the two companies you mentioned earlier happen to have ASX listings, and the ASX crowd really knows how to appreciate these types of lithium deposits. I'm talking my own book because everything this company has is also shared by my top holding, which we've talked about a lot in the past. And so, no, I see nothing but blue-sky potential for that company that you're speaking of, which will keep the ticker symbol to ourselves,.
And Patriot Battery Metals (TSX-V: PMET)(OTC: PMETF), which is my top pick and my top holding. And I'm talking my book again, but a lot of money to be made.
You've made this in a very volatile market. You got the major indices correct. You've had the energy market correct. Again, that's not to say that everything we pick goes up, but man, we've allocated pretty damn well during a very tough environment. And so, if you can deliver new 52-week highs in this market, kudos to you, sir.
Nick Hodge: Well, thank you very much. You've done quite well with Patriot Battery Metals as well. That's a portfolio-maker by itself.
Gerardo Del Real: Yeah, no, no, no, no. And the room to run, I think it's still consolidating here with the quiet period while it gets its ASX listing. It may be quiet for another two or three weeks. That's an opportunity to accumulate. I may be adding to my personal position. We talked a bit about that off-air.
Will Dollar Strength Continue?
Let's go back to the overall markets. I talked about Jerome. You mentioned Jerome and you gave your take. The US dollar last week we said near term, it looked like it had been a bit toppy. It did pull back to the 110 range. And then, sure enough, as soon as somebody whispered to Jerome that people are taking a speech the wrong way, it's now surging back up and flirting with that 113 area. How do you see that play now? More capital flight into the US dollar?
Nick Hodge: It's been ‘buy the dip’ in the US dollar for the past nearly year almost just like it was ‘buy the dip’ in the indices for a long time before that. Yeah, the trend for the dollar is still bullish and the trend for rates is still bullish. And again, that's what keeps the lid on the metals prices. It's why you can't get silver above $20. It's why gold was closer to $1600 this week than $1700.
Gerardo Del Real: No silver squeezed to the moon, Nick?
Nick Hodge: No. And I saw more people calling for it.
Gerardo Del Real: I saw it. That's why I brought it up.
Nick Hodge: Citing depleting stocks on the COMEX. None of this matters. As I said in my presentation in New Orleans, the only thing that matters is the last price. And the last price is bearish for silver. It's not in an uptrend. And the dollar is going to remain strong. Other central banks continue to hike alongside the US Federal Reserve. I know you could say that Canada blinked or whatever, but other banks aren't blinking. Saudi Arabia hiked three-quarters of a point.
Gerardo Del Real: We're going to talk about Saudi Arabia later on.
Nick Hodge: There's another country that hiked three-quarters of a point, and Norway was hiking. And so, no, the dollar's going to remain strong until it isn't. And I think that's still a quarter or two away.
Lithium Stock Earnings
Gerardo Del Real: I want to cite one more lithium fact for everybody. I'm going to go back there really quick. While you mentioned Newmont earnings and how disappointing they were and how you can get a 5% dividend while you wait for the gold sector to turn. When the gold price starts surging again — and it eventually. We're not gold bears or silver bears. It's just in a bearish trend for now, right? That'll rotate over. But while Newmont's struggling to deliver on their bottom line, Albemarle, which you mentioned earlier, lithium giant Albemarle just posted 152% jump in quarterly profits.
It's a tale of two markets right now, folks. You have to do some due diligence in this space if you want to make some money. It's beyond me why we have to make money just from gold or just from a silver squeeze or just from cryptos to the moon or Bitcoins to the moon or Dogecoin to the moon. Like Keith McCullough says, "You can pick your favorite narrative and go fall off the ledge with that. Or you can actually look at what's happening and put pencil to paper and start looking at numbers and trends and make money off of those."
You pick your poison, everybody. I'd rather make money off of what's actually working then trying to be right with gold and silver right now. Gold and silver are going to continue in sideways mode. And silver maybe has another leg down. We'll see.
Nick Hodge: Two things there. Albemale itself is a dividend aristocrat like if you were to Google ‘dividend aristocrats.’
Gerardo Del Real: Oh, I like that word. Don't cancel me, people. I like the word aristocrat.
Nick Hodge: And look at the list of, I think it's 60 or 65 companies that have consistently raised their dividend for years and years on end. There's the Pepsis (NASDAQ: PEP) of the world and the Abbots (NYSE: ABT) and the Abbvies (NYSE: ABBV) and the Johnsons & Johnsons (NYSE: JNJ). But Albermale is on that list. It's a small dividend. It's only 0.59%. But if you're a long-term, safe, stable-minded investor, that's got earnings growth and it's like $25 away from its high, trading in the $270s with a 52-week high near $300.
And back to gold for a second. I know we're jumping around a little bit, but gold will have its time on the backside of this recession. And as the Fed, not pivots, because I'm done using that word, but as the Fed comes to the end of its hiking cycle. It fucking did everything he said it was going to do. There was no pivot as it comes-
Gerardo Del Real: For once, I gave Jerome credit where credit is due. He might fuck everything up and implode the whole system. But he did deliver this time. This is the first time in his history. He hasn't blinked yet. Good for him.
Nick Hodge: So, I think as they come to the end of their hiking cycle, gold is going to have its day. I was telling you earlier, I don't know if it was before we started recording or not. I was putting bids in for the VanEck Junior Gold Miners ETF (NYSE: GDXJ) today. It's near 52-week lows. That's a timeframe thing. That pays a dividend by the way as well. I'm content to reinvest that dividend in GDXJ, let that compound for the next year or two until the gold cycle comes back.
It's not that I'm saying gold is the devil. I'm just saying gold is not going to go up A, in the short term, and B, it's not going to go up because there's some squeeze or there's some, whatever, conspiracy or depletion or we're out of reserves or Fort Knox is empty, that stuff is not investing. You know what I mean? Anyway, gold will have its day. I own gold stocks as well for sure.
Where Are Oil Prices Headed?
Gerardo Del Real: Oil had itself a pretty decent week on the back of some rumors that Iran was potentially looking to attack Saudi Arabia. It's interesting to me how much the US continues to cozy up to Saudi Arabia despite the, let's say, sketchy history between the two nations and things that have actually happened in this country, to us and to some of our citizens, very explicitly coming from that part of the world as it relates to their government, not their people of course. And so, interesting to me that they're sharing intelligence on something of that nature.
Interesting to me that they chose to publish the fact that they're sharing intelligence. And again, we call this investing in Bizarro World. It's not getting any less bizarre. You had North Korea firing off missiles. There's increased whispers of China taking Taiwan because why not, right? It's 2022. The bingo card is getting bigger. Any thoughts there?
Nick Hodge: Yeah, I'll talk because it's a podcast and that's what we do. For me, the couple of articles I read seem to think that if Iran does do that, it would be a distraction from what's going on domestically in that country, to divert away from the protests and the things that have been going on there. As far as the likelihood of it happening, I'm not sure, I'm not a geopolitical expert. I do know that it would drag the US and allies into it at the end of the day, despite all the things they already said about the rocky past, 9/11, Khashoggi, all that stuff. We still need our oil and they're still our allies. So, we would go to protect them.
And who knows what quagmire that would be in the Middle East because certainly, the Middle East is known for some quagmires. What's interesting and challenging, I should say, maybe not interesting, is that oil got to $90 and that's not like... I mean yes, it went up, but it didn't soar back to $100, certainly not back to the $110 or $115 we were at in spring of 2021. That sector's increasingly difficult to figure out. Some of the equities are... they look a bit toppy to me. I sold an energy MLP, a week or two ago in Foundational Profits, the monthly letter. I currently don't own any mainstream oil stocks.
I was looking at a couple this week but couldn't really pull the trigger. And the reason for that is I think we're in a recession, and I'm not sure how the demand destruction is going to shape up for the oil. We mentioned last week about this diesel shortage, how we only had 25 days of diesel left. And I guess that's a real problem. I was reading about it in a couple more real newspapers or outlets and things like that. And that's another reason I think that the Fed remains hawkish.
They're trying to destroy demand. Obviously, they're trying to slow down inflation and the economy. And so, I'm not sure how this recession and higher rates are going to slow down the demand for oil despite the political turmoil on the other side. And so, for me, it's enough just to say, "Hey, you know what? I don't get this right now, so let me just sit on the sidelines." And I think there's other sectors on the broad S&P level to look at.
I still own a couple of consumer staples, which is one of the few S&P sectors that has performed alongside energy this year. Not as well as energy, but certainly not as bad as discretionaries or real estate for example. So, I'm content to sit out energy for right now. Dollars to doughnuts. I think oil goes back down around below $90. And this turns out to be a headline that passes. Iran to me is, I'd lump it in there with North Korea. Fuck around and find out. What do they really got?
Gerardo Del Real: Yeah, let's hope so. Let's hope so. It's obviously a very, very complicated country. I think half the country definitely leans towards democracy and leans towards being free. And then, as usual, you have the governments that increasingly lean less and less towards freedom and more and more towards restricting. And that can be said of many governments, most governments around the world.
Elon Shakes Up Twitter & Blue Check System
We have to talk about Elon. Because Elon, again, is the best billionaire troller that I've ever seen. There's a couple of other ones that are right at it. Mark Cuban is right at it, but he's actually more factual with this stuff. Elon doesn't care.
Elon wants to charge $8 for your little check mark. And AOC said, "Laughing my ass off at a billionaire earnestly trying to sell people on the idea that free speech is actually an $8 a month subscription plan." And Elon responded, "Your feedback is appreciated. Now pay $8." And then, some other people started attacking him for something else. And he said, "Being attacked by both right and left simultaneously is a good sign.” And I concur you're probably doing something right. You can manage to piss off both sides of the major political party spectrum.
Any thoughts on Elon? And you got to give the guy credit where credit is due. Somebody, I think it was... who was it? I'm a fan of his, what's his name? The gentleman from The Big Short, I forget his name. Michael, Michael, Michael.
Nick Hodge: Is it Michael Burry?
Gerardo Del Real: Yes, yes. Michael Burry. And so, he tweeted a post and he said, "Listen, you cannot like Elon, you cannot like his past, you cannot like what his parents did. You cannot like Elon for any number of reasons, but you got to give the man credit for being in the arena and playing the game because he gets in the arena and he plays the game and he puts his own money up.” And at the end of the day, you have to admire the man that steps in there and is willing to get his ass kicked."
Nick Hodge: He'll tweet about all stuff. And so, yeah, I do have thoughts. It's amusing, first of all, to watch your political leaders and the richest man in the world get petty on a social media platform. I'd pay $8 dollars for that if I had to. Maybe we'll finally get a Blue Check. I've actually submitted a few times under the previous regime and was always turned down. And I would bet that was a function of not shadow banning, but definitely some of the things I've tweeted in the positions I've taken over the years. Right? I'm not like the Blue Check crowd.
Gerardo Del Real: For those not familiar with the BlueCheck system, can you explain? Can you pontificate?
Nick Hodge: It's a verification system essentially to make sure that the account that you're looking at is actually the account that you're looking at. It applies to politicians, people of stature, people in the media definitely love it. You get your Blue Check and that means you're somebody, right? You're important when you get your Blue Check. But it's to help dispel bots and cloning and hack accounts and all that stuff. And it was free, but you had to go through a process. And the process was increasingly onerous. Early in the Twitter days, they were just handing it out, and then later, you had to submit an application.
This is the book I wrote, or these are my press credentials, and this is why I should get the check. And honestly, I submitted a few times and was never verified. So, I guess I wasn't important enough. But now he's saying that anyone that wants a Blue Check can just pay $8 for it. And it became a cultish thing in some circles, which is why of course, people will pay for their Blue Check because they want to remain verified.
Gerardo Del Real: This is a good one. To all complainers, please continue complaining, but it will cost $8.
Nick Hodge: Exactly. So, I got a lot more thoughts I guess on this. She was also saying that he's not going to be able to, whatever, for a $40 billion acquisition and the debt that he has, AOC was saying that $8 a month isn't going to make a dent. Well, perhaps not. Perhaps it's only, like I saw some numbers, I forget what they were, $50 or $100 million a year revenue stream or something like that. But one, I don't think you're the one to be given the richest man in the world economic lessons and how to grow a business. And two, now the left is talking about other platforms. First, it was, Trump got kicked off and went to... I forget now even what that one was called.
Gerardo Del Real: Parler, I think.
Nick Hodge: No, there was another one. Truth Social it was called
Gerardo Del Real: That one. Truth Social. I can't keep track of of it all, yes.
Nick Hodge: And then, Parler, which is the one Kanye bought when he got kicked off. And now, the leftist's saying, all these Twitter folks that just got fired, because he fired a lot of the top executives and things. They're saying that they're going to go start another thing. And it's like, "Well, great, man, have fun. It's a free market. Go start up your own-
Gerardo Del Real: Get in the arena.
Nick Hodge: Exactly, right. And the other thing is, I continue to say, and I've said this for a while. Well, I go both ways on it, but Twitter's a company, man. And so, Twitter's not the United States of America. Free speech is for citizens and for the public and not necessarily for the private companies. Though I do, and I’ve mentioned this before too, give credence to the argument, that when so many people do join it, and this is why, good luck starting your other platform. There's so many 10s, 100s of millions of people on Twitter that you have an obligation to foster free speech. And we'll see what he does with that.
But back to the Blue Checks for one second, because there was a story I wanted to talk about on this podcast for a while and never got around to mentioning it. There was a scandal on Instagram recently. Hundreds of millions of dollars were spent by people to get verified. So, I mentioned how people seek the Blue Check. Well, Instagram has the Blue Check too. And there became an underground market for getting a Blue Check.
And the way that these people were doing it is you would pay whoever this network was to make you into an artist. Either a music artist, an artist. And they would create accounts for you. You would get a Spotify account. This one doctor in the article, he's a real doctor, he's a plastic surgeon I think in Canada. And he paid to get verified and he was like DJ Dr. X or something. That was the persona they created for him. So, they make a Spotify thing, they make some fake tracks to make it look like he's an artist.
And then, they submit to Instagram, "Hey, this is DJ Dr. X, look at his Spotify profile. These are some of the tracks he's made. He should be verified as a musician." So, he would get the check. And then, that was the end of DJ Dr. X. Then he was just Dr. Smith or whoever he was, but he was now verified Dr. Smith. So, it helped him in his business and professional life to attract clients or whatever it was. Well, this was done, like I said, $100s of millions of dollars were paid, thousands of people were using this system to become artists to get verified. And it was a total sham.
And so, I just thought that was a pretty good allegory, a pretty good story for... it doesn't matter if you're verified. You are who you are. And what matters is, I think, the merit of your work and the ideas you put out there. Not necessarily if there's a Blue Check by your name. But sure enough just cliques in high school, cliques in social media, they want their Blue Checks, man. And that's why they'll pay $8 a month.
Gerardo Del Real: That's why they'll pay $8 a month. Again, if you don't care, don't pay the $8 if you don't want to, but if you care, don't say you don't care and go pay the $8 a month. It's not that difficult.
Nick Hodge: I don't have the time or energy to pretend I'm an artist to get verified.
Gerardo Del Real: I don't care enough. You know we've had these conversations. Hey, Gerardo, you want to meet so and so? Nah, you go talk to him. I could care less. But it'll be good for business. Well, that's all right. I don't think I'll like that person. Let's skip that lunch.
Paul Pelosi Attacked
Anyhow, we can't end without talking about the attack on Nancy Pelosi's husband. We've talked about our immigration system. I'm kidding y'all. But he was a Canadian immigrant, and if he was Mexican, I guarantee you that the headline would be “Immigrant violently attacks one of the nation's top politician's spouse.”
That's not the real story that this gentleman was an immigrant or that he was from Canada. I love my Canadian friends and obviously, my parents are immigrants. I have lots of admiration for hard-working, honest immigrants. However, with that being said, I couldn't let that go and not bring up the fact that nobody's bringing that up. He was a Canadian immigrant, not a Hispanic immigrant. That's just the way that works.
Here's the real story. First off, horrible attack. Horrible, horrible. He was tied up, he was beaten with a hammer. I mean, had to have surgery for a skull fracture from what I understand, and other injuries. The guy was in the house looking for Nancy Pelosi when Capitol Police finally got in there. Now, the part that's troubling to me is that once again, it appears Capitol Police were instructed as they are to watch over the house. And there was a surveillance system in place and the surveillance system was working, except nobody was paying attention.
I said this after January the 6th, and I said, "Look, not all the cops there opened those gates and let people in." But even on January the 6th, I was saying, "There's no way all of that happens with only one or two shots being fired. And you're running amok, looking for politicians to lynch. There's no way that happens without there being some coordination from law enforcement."
And again, on this attack on Mr. Pelosi, I have to believe, Nick, that some people are rooting for this type of stuff and that some people within the Capitol Police continue to be very supportive of these types of actions, which whether you are a leftist, a rightist, a libertarian like myself, whatever you are, you don't care about any of it — there is no room for that violent behavior.
Yeah, I don't know. Let's see where this investigation ends up. Seems like a lot of coincidence with that police department.
Nick Hodge: Yeah, I don't have a lot to add there. I've seen the police response at peaceful protests. And I've seen the police respond with rubber bullets and police on horses. And so, to your point on January 6th, yeah, I've seen many other protests that were quelled much faster and certainly not allowed to escalate in that fashion. So, that's one thing. And then, political violence is par for the course in a Fourth Turning. So, it happens on both sides. And I don't think that's going to be the end of it.
I haven't looked deeply into this gentleman's background, but it's something that we're going to have to deal with as there's excessive polarization in US politics. And it's funny, not funny, you mentioned the immigrant thing. I get the ads for Idaho Senate because I'm right here on the border of Washington.
Gerardo Del Real: Well, it's got to be sassy.
Nick Hodge: Oh, my gosh. And my wife, I didn’t actually think of it, but my wife was like, "Why is this guy talking about the borders? Is he talking about the Canadian border? That's the only one they have.” They border Canada, not Mexico. He's talking about people coming in our borders and things.
Gerardo Del Real: My family's coming to take your jobs and rape your woman and take your kids, Nick.
Nick Hodge: Well, that's what the ads say.
Gerardo Del Real: You're going to have to speak Spanish, and it's fucking over.
Nick Hodge: And I've seen some songs. I follow John Rich, who was a country singer, on Twitter, of course, because we had some business dealings with him a couple of years ago. And he's a pretty hard right-leaning guy, very vocal about whatever, right-leaning stuff.
Gerardo Del Real: Sure, whatever he's passionate about.
Nick Hodge: Sure. And he's got a new song out. It's called Progress, and he wants you to stick your progress where the sun don't shine. And he talks about people coming basically to take our jobs. And the background of the video, I'll have to put a link up. It's a horrible song. But protests, fires in the background, all the things. And so, essentially, this is like political music. It is like a Fourth Turning. Think about Crosby, Stills, Nash & Young in the '60s or something like that.
Gerardo Del Real: Bob Dylan. Nina Simone.
Nick Hodge: Absolutely. Who is still alive and touring by the way. That dude's almost 90 years old. Anyway, yeah, sad, sad stuff. And obviously, impermissible and ill-advised on both sides. It should never come to violence.
Gerardo Del Real: I'm sure if I went to a John Rich bar, there would not be any undocumented immigrants providing any labor in any capacity.
Nick Hodge: Necesitan trabajo.
Gerardo Del Real: Anything else on your mind, Nick? What are we watching in the markets this week? What are you watching for?
National Catalytic Converter Theft Ring
Nick Hodge: I wanted to tell you first about catalytic converter thefts.
Gerardo Del Real: Oh, that's right.
Nick Hodge: Which we've mentioned on this podcast before in relation to the price of palladium and platinum and rhodium, which relates to another investment that we have.
Gerardo Del Real: That I told you if you subscribe to Nick's newsletter, he'd give you the name and if you didn't make money on it in a year, we'll give your money back for free.
Nick Hodge: I've long said that we don't have to be the person that's stealing catalytic converters or copper pipes from abandoned buildings. You can invest in the metals themselves or the companies that have leverage to the metals, either by producing them or exploring for and developing them. And so, catalytic converter thefts continue to be a real thing. We've seen the stories for years about thieves going into parking lots, church parking lots, and knocking off multiple cars.
Or going into multiple cars overnight in the same neighborhood and taking out the components of the catalytic converter because there's a few ounces of those PGMS, those platinum group metals, or PGEs, platinum group elements, that are in those things. And those things are expensive. Platinum and palladium trade like gold, and they're $1000 or $2000 an ounce. And rhodium is even more — something like $12,000 an ounce.
And I just saw a story this week and wanted to mention it quickly that there was a national ring of catalytic converter thefts and transportation and breakdown. I think the ring in California supplied like $540 million worth of metals to this company in New Jersey, who was then breaking down the material and selling it to metals refiners and recyclers. And then, there was a ring in Oklahoma that was much less because it's Oklahoma, but it was still like $40 or $50 million-
Gerardo Del Real: Sorry, Oklahoma.
Nick Hodge: ... millions of dollars where the palladium goes sweeping down the plains. Anyway, international rings for catalytic converter thefts because of the price of those metals inside. And I just wanted to bring that up because, one, it's not going away. Two, it's basically a sea to shining sea network of criminals that's doing this and taking the metals and recycling them. And there's a legal way that you can profit from the high price of PGMs. And that's why, like I say, owning assets that are going to produce them. Did you just Google the story? Are you reading it?
Gerardo Del Real: I did, $545 million. Catalytic converter thefts are up tenfold since 2018. That's only four years, guys and gals, with more than 14,000 reported being swiped in 2020 alone. Yeah, no, look, everybody has to pick how they make their money, but there is a right way to do it. And you don't have to be stealing catalytic converters, obviously. You can de-risk the odds of you going to prison, folks, if you just do a bit of due diligence and again, subscribe to Nick's newsletter. He'll tell you about a company that's got a tier-one deposit. It's got $40-something million in the bank. It's got a new discovery. It's got an all-star board of directors and team that leads it.
I'd be surprised if that stock isn’t a fourfold or fivefold win for us in the next 18 to 24 months, Nick. I joked about uranium back during the bear market in December, January of last year.A nd I was telling everybody, I was picking away at uranium names because they were just too damn cheap and the fundamentals were too damn good. It was watching paint dry for the last few years with companies like UEC (NYSE: UEC) that were trading at $0.50 at one point and reached a high of $6 or $7.
And my point to my subscribers was, if a tenfold return or a twelvefold return is like watching paint dry, if that's all it takes, I'll watch paint dry every day. It's not that hard if you just have a reasonable enough timeline and the liquidity to let the fundamentals and then the market meet. That's all I got.
I'll be watching for Nevada Sunrise (TSX-V: NEV)(OTC: NVSGF) this week. I'll be watching to see if the dollar continues to surge higher. I'll be watching central bankers and their doublespeak to see how much of that starts changing in rhetoric and tone. Whispers from the Bank of England that they will not continue to be as aggressive as they have been because they want to... you'll laugh at this Nick, avoid a recession as if they aren't knee-deep in one already and haven't been for quite some time. So, no, it should be an interesting week. Anything else on your end of it?
Nick Hodge: No. Still watching earnings. Had a couple of companies on my watchlist that didn't have great earnings that are now cheaper, might deploy some capital into them. Want to see this jobs report that'll be out by the time this podcast comes out and then I have a big monthly issue to write next week. So, I have more macro things to talk about as I look more closely to knock that out.
Gerardo Del Real: Love it. You all be nice to each other out there. Have a great November. Have a great week. Nick, you want to send us off?
Nick Hodge: See you.
Gerardo Del Real: This was episode 193 of nvesting in Bizarro World. Folks, be good out there.