Frmo Corp

Good afternoon, everyone. This is Therese Byers speaking, and I'm the corporate secretary of FRMO Corp. Thank you for joining us on this call. The statements made on this call apply only as of today. The information on this call should not be construed to be a recommendation to purchase or sell any particular security or investment fund. The opinions referenced on this call today are not intended to be a forecast of future events or a guarantee of future results. It should not be assumed that any of the security transactions referenced today have been or will prove to be profitable or that future investment decisions will be profitable or will equal or exceed the past performance of the investments. For additional information, you may visit the FRMO Corp website at frmocort.com. Today's discussion will be led by Murray Stahl, chairman and chief executive officer, and Stephen Bregman, president and chief financial officer. They will review key points related to the fiscal 2025 first quarter earnings. Now I'll turn the discussion over to Mr. Stahl.

Okay. Thank you, Therese. Thanks, everybody, for joining us. So I'm going to, in my introductory remarks, I'm going to do it in two parts. One, I'll point out some things I find interesting. They're on our financial statements. Then I'll point out some things that are not on financial statements that I also find interesting that would be good to get some more information on, I think. And then we'll go to questions. So let's start with the things that should be obvious. So looking at the balance sheet, you can see that our total assets, $548 million, that's a record for us in the event. And you'll see our cash balance. I'm not sure if the $42.4 million is a record or not. It looks like it's certainly a recent record for many, many years. I don't know if we might have modestly exceeded that at one point. But if we did exceed, we didn't exceed it by much. So it's close to a record, possibly a record. Here's some things that are on the balance sheet that are, the consequences are not necessarily so obvious. Let's do the most obvious of the less obvious first. You'll see our deferred tax liability is now up, exceeds $42 million. It's basically a tax-free loan from the government. So as long as we keep that going, we're going to earn a lot more money than we otherwise would earn if we paid that. So that's one of the reasons, but not the only reason why we're long-term investors. So that is a number worth paying attention to. Now, a part of that number is something you'll see under security sold, not net purchased, we basically sell short. What we call dysfunctional and other people call path-dependent ETFs. And you see our cost basis comfortably exceeds $10 million, and the market value is less than a million dollars. It would be nice if we could carry that and never realize a tax. But there are two things bad. Number one, sometimes if these are exchange-traded notes or ETNs, some of these are exchange-traded notes, they have a maturity date, and we have to realize it. So we have no choice in that regard. And secondarily, even when they're funds, they're ETFs and they're not notes, and therefore we don't have a maturity date as such. Those funds pass out K1s to people, and if we're short, then we might inadvertently or let's say by the nature of the investment, have profits passed out to us from being short, and therefore we have to pay tax on it. So it's not quite as good as a long-term security that you hold, but it's almost as good. So when that declines in value, there's margin released. And as you can see, that is not an insignificant part of our cash balance. So we use our cash balance to do all sorts of interesting things you'll hear about presently. Another thing that you'll find not so obvious, interesting, so you have these digital assets. Now, over $9.5 million, we keep mining more digital assets. You'll see the cost basis went up. Cost basis goes up not because we bought digital assets, we mined digital assets. So the mining is continuing. We have to live with the fluctuation up and down in value, and in this quarter the value actually went down modestly. But in the long run, it's going to be a great investment. That also forms a part of our deferred tax liability, it's worthwhile saying. Now, if you go further down the balance sheet, and you will see digital mining assets, that is the equipment that have accumulated depreciation. That's actually the equipment that we have, that we own, that we use to mine. You'll hear in a moment about we've been doing a lot of our mining inside of Winland, you'll hear about that presently. We're not actually letting these amounts decline nothingness. You'll hear presently we've been changing the kinds of equipment we've been buying, and we've been buying mining equipment gradually. This is a very unusual sort of balance sheet position relative to other companies. Other companies make huge investments at one time, and then when I made the market weave it, it had a gradual approach. Now, I'll go into the gradual approach in just a minute or two. Let me point out where we've been dramatically increasing our crypto investments, and that's by expanding into Winland. So much of our cryptocurrency mining activity takes place in Winland. So we own as a firm now, these are round numbers, not exact, but for our purposes, they're exact enough. We own as a firm about 38% of Winland, and because a company related to us called Horizon Common, and myself personally, own about 2%, we control about 40% of the votes of Winland. So we do two things. One, we buy Winland in the market to gradually increase our exposure, but secondarily, of late, for most of the cryptocurrency mining equipment we bought, we basically swap that. We buy new equipment, we swap it to Winland in exchange for shares of Winland, and that of course raises our ownership of Winland. The reason for the gradualist approach is twofold. The first is that when we started mining years ago, there was no one, including ourselves, that knew everything there was to know about mining, nor could anyone have known everything there was to know about mining, because the nature of mining over the last eight years has changed, in some ways, quite dramatically. So we've been learning as we go, and our mining operations have gotten much more efficient than they were, than they've ever been. And I would say this year, the calendar year of 2024, we've made the biggest strides we've ever made in efficiency and profitability, and we're still learning. So it's an ongoing learning experience for everyone. Second reason is the nature of the equipment is constantly changing. So you were to compare the most recent iterations of equipment and the energy efficiency related to that relative to the equipment that you could have purchased eight years ago, it's just incommensurable how much it's improved. Now, if the equipment generations were released on a predictable cycle, what you could do is you could buy a lot of equipment in one order, and you could wait for it to pre-shade, and you'd know when you'd be able to plan what time you need to buy new equipment, meaning you'd be able to know in advance when your equipment might be obsolete. The trouble is that there's a number of companies active in that field, and no one knows, including sometimes the companies that produce this equipment, when a new generation of equipment is going to be released. They're all competing with each other. So it's not an established market in the sense of equipment markets under field trucking, agricultural equipment, automobiles. It doesn't have a schedule attached to new equipment iterations. Therefore, we have to be very careful not to put too much money into any one generation of equipment for two reasons. One, danger of being obsolete by a new innovation. Secondarily, the new equipment, we'd like to buy a small amount and test it because some equipment is just more durable than others. We've had some great experiences where we bought equipment, and we would have thought ourselves very fortunate if we would have gotten a useful economic life of not even three years. We ended up getting an economically useful life that exceeded four years. Sometimes it happens. I'm being very fortunate in that regard. On the other hand, sometimes some other things happen that we either couldn't have predicted or we should have predicted, but we didn't predict. Here's something we should have predicted. This happened a while ago that we just didn't predict. We should have more thoroughly checked every delivery of equipment for the presence of viruses. And in one delivery, we forgot to do it. It's a remediable situation, but you have to stop what you're doing, unplug all the machines, and search for viruses. That can be very time consuming. Then you have to remove the viruses from machines. That can be even more time consuming. Then effective it is we had a certain period of time when we couldn't use the equipment productively, meaning we couldn't mine. It wasn't a great number of devices, but it actually happened. And it wasn't a great number of devices because we never buy in any shipment a great number of devices. And that's one of the reasons we don't do it. Unfortunately, we forgot to check that shipment. And look, they're human beings, and sometimes these things happen. Here's something that we probably could not have predicted, but it happened to us. We have diversified our equipment into a variety of different hosting sites. Some cases we control those sites, other cases we don't. And believe it or not, some of our equipment actually got hit by lightning. It wasn't destroyed, but it was rendered basically inoperable. So did we have insurance for those machines? No, we did not have insurance for those devices. Why did we not have insurance? Should we not have predicted that? We did predict it. We would very much have liked to have had insurance. Unfortunately, at that point in time when these things happened, no insurance company was willing to insure small batches of devices. They felt that the underwriting results were too unpredictable. In any case, with our balance sheet, we're effectively, not really, but effectively self-insuring we can afford the odd mishap that actually happens. So we're well prepared. In any event, at some point, or actually at this point, we're increasing our ownership of Winland and we're increasing our crypto mining activities. They're getting much more profitable than they've ever been. And at some point, if we reach that point and we own over 50% of Winland, we're going to have to consolidate. At that point, FMO will be effectively an operating company. So as I said, we're learning constantly, our probability is increasing. It's never been better than it is right now. And if things go as planned, it's going to be better yet in the forthcoming months. We've been looking for many, many years for business to get into to turn this into an operating company. We didn't want FMO to be yet another asset management company. And of all the, and I wrote this in the shareholder letter, all the potentialities, there were businesses that we didn't know very well. We didn't want to buy those. There are businesses we did know very well and we liked, but they were just too expensive. We wouldn't have had a high return on capital. So it became this. And this is something that we thought would be within our ability to comprehend and end up having good outcome with. And I think you can see from the results, we have a pretty good outcome thus far. So that's the plan. And that's a brief resume of what we've done. So without further ado, maybe Therese, you probably have some questions that you've compiled. And I think we'd be delighted to answer those if you would kindly read them to us.

I'd be happy to. The first one we have is what FRMO issue keeps you up at night?

What FRMO issue? To tell you the truth, maybe I shouldn't say this, but I'll say it anyway. I actually sleep very, very soundly. And I'll tell you why I sleep very soundly. Our equity investments, not entirely, but largely, were invested in hard assets. And if you examine the history of wealth on this planet, and I think I've written about this in several of my compendia, throughout history, wealth has been largely in hard assets. Why? Because unlike intellectual property assets, hard assets, they're land or gold or things of that type or diamonds, they exist more or less infinitely. Intellectual property can only be surpassed by superior intellectual property. We live in a very unique age historically in which if you look at stock marketable intellectual property has a lot more equity marketable than tangible assets. And I believe that's going to shift. So there's that. And then we also prepared through our cryptocurrency investments for the ongoing currency debasement that's taking place, not just with US dollar, but everything in the world. And you'll see the BRICS companies or BRICS countries, I should say, are about to have a meeting and they're talking about having a BRICS currency that would at least trade alongside the dollar and it's going to be backed by some hard asset like gold or maybe a basket of hard assets. And there comes a time that the asset producing nations of the world will be reluctant to accept the currency. Those are the big risks. We prepared for them and I don't stay up at night worrying about it, but I will say during the daylight hours, we work exceedingly hard to prepare for a variety of contingencies such as which thus far talked about a few of our mishaps in cryptocurrency.

So I hope that's a good answer. Yes.

The next is what is MyAX's competitive advantage?

What is MyAX's competitive advantage? Well, to begin with, and this is an opinion, MyAX has, in my humble opinion, the best technology

of all the exchanges. And I don't think

it's even close.

So

measured by latency, the ability to adapt to new products, I think it's the best. But of course, that's just my biased opinion, so you can take it for what it's worth. However, MyAX does have one other interesting attribute that the other exchanges, I think, do not have. That's more tangible. So MyAX is a multi-asset class, multi-geography exchange. So are there multi-asset class exchanges? Yes. So MyAX is multi-asset because it has a stock exchange, an options exchange, and also has a futures exchange, which is the old Minneapolis Green exchange that's now MyAX futures. So the CBOE has an equity exchange, an options exchange, and a futures exchange. So it has that, but MyAX also owns Bermuda stock exchange. That puts it in a different geographical jurisdiction. None of the other American exchanges have that. And Bermuda stock exchange, because on the one hand, it's part of the United Kingdom, so Brexit affects it. On the other hand, it's a separate jurisdiction, so Brexit doesn't entirely affect it. It has what's known as an ESMA, which is the right to trade in Europe under certain conditions. So I don't know of any exchange that's yet achieved that diversification event. It's pretty neat. And I think MyAX, as you can see from their press releases, they're building on that,

and

we'll see how they do as

the months progress. Space X

is increasingly launching heavier payloads. Will part of the AI infrastructure move from Earth to outer space to take advantage of lower temperatures and lower latency?

Well, I'm out of my depth. In answering a question like that, I can just tell you this. The Chinese, I guess about 10 or 12 days ago, the people of the Republic of China, launched their competitor to SpaceX, which is known as ThousandSales. So SpaceX, I think, is supposed to have 7,000 low Earth orbit satellites. I think ThousandSales, when it's finished, is going to be something like 14 or maybe 16,000 satellites. I don't recall exactly where it's going to be. Will the critical data of the world move out to space? I very much doubt it. May well be that you get free cooling because you're outside the Earth's atmosphere. That's good. The trouble is you've now got to project the results of inquiries down to base stations on Earth so all your secure data can be intercepted by anybody with a high quality antenna. So I don't think any corporation is going to have really secure data, and I don't think any person is going to want their social security number or their credit card number or their bank account beamed off satellites because any rascal could pick it up. So I think the only way to keep it secure is landline. So I don't think they're moving any of that data center business to space. That said, there may be computations that are very complicated that might be worthwhile doing in space, but nothing that's data proprietary,

I shouldn't think. Next question has a long prelude.

Management has proposed that index ETFs are becoming the marginal price setter in the market. The 2023 second quarter Horizon Kinetics commentary asserts that if index funds had begun in direct contravention of its purpose to directly change clearing prices and the very character of the markets it purported to free ride upon. An element of this idea that I'd like to ask about is whether management could recall here any data on the proportion of average trading volume in major index stocks that is directly attributable to ETF creation and redemption activities versus total market volumes as opposed to secondary market trading of ETF shares which do not cause buying or selling of the underlying share. One would think this proportion should be quite large in order for index funds to be price makers rather than price takers. My understanding is that share creations and redemptions in passive index strategies are responsible for only a small amount of total market trading activity. A 2019 Vanguard study which management confined as titled quote a drop in the bucket indexing share of US trading activity end quote concluded that only 5% of average trading volume in major index stocks is directly attributable to ETF creation and redemption activities. Though I'd note they only use a single year of 2017 data. What evidence supports management's idea that ETFs set prices given their apparently small contribution to total trading activity?

Okay well first of all it's a good question. Let me start there's a lot I can say let me start this way. The the that study is designed to answer its own question in the way it's supposed to be answered. So you can't merely look at redemption and creation baskets and then take the ETF trading itself and ignore it. So for example let's take the most widely traded ETF where I believe is the S&P Spider symbol SBY and I don't remember the number the number of shares traded off the top my head every day but I think you can look it up in minutes and you can see that it wouldn't take very many days before the entire SBY changes over. So to say that the trading of SBY or the Vanguard ETF VOO also S&P 500 or the iShares S&P 500 ETF IVV has no effect on security prices when it's the major share of New York Stock Chain trading volume. So whereas what the problem with the whole analysis is I'll go into it deeper in a second. So basically say there's volume of X on New York Stock Exchange and then you look at the creation and redemption baskets say it's really only a small proportion of the volume and you don't look at the major components of New York Stock Exchange volume are the trading of ETFs. There's no question about it and I could give you many many more ETFs to look at you can look at QQQ there are many others and basically take all that ETF trading and put it into the column of the active managers when it's all indexed to actually do that I think that completely misses the mark if I may say so. That's number one so to do a proper study that way you'd have to add the trading of the ETFs because those are the stocks so it's not that people create and redeem baskets it's that they trade the indexes as if they are stocks and in point of fact they actually are stocks. So to say that that index trading does not affect security prices I mean how do I say this politely I don't know how to say it politely it's an escape from reality I'm sorry for expressing it that way and normally don't say things like that but it really is. Now let's look at it another way so if you were to look at it in terms of the assets under management of indexes so for example the next providers which is S&P Global or MSCI or Russell which is they give you what their assets under management are meaning how much indexed investments are or what is the market value index investments that are managed in accordance with their indexes and it's an incredibly big number I put it in one of the compendia I remember which one it is and I remember a number off top my head but I'm willing to bet whatever I said it wasn't that long ago I'll bet it's bigger today. So now if you take that figure which is it's a big figure whatever it is look at your trading volume how could you come to any other conclusion then the theory that's a drop in the that's a drop in the bucket is ludicrous on its face

so that's my response.

Hey in September of 2022 Horizon Kinetics published an article called Mining Economics and What Drives the Bitcoin Price Volatility Versus Information Efficiency where they link the price of bitcoin that's being led by the price of ASIC mining rigs the piece includes a graph that compares the price index of mining equipment with the price of bitcoin from dash dot hash rate index dot com which seemed to show a strong correlation from the start of 2022 however since January 2023 we've observed a significant divergence in this relationship with the bitcoin's price rising while ASIC prices have remained relatively depressed and stable how does management reconcile this apparent breakdown in the correlation that supported the thesis in this article has management's view on the relationship between mining economics and bitcoin's price changed furthermore how might this shift impact FRMO's bitcoin or rig purchasing strategy moving forward

so okay well first of all I don't believe I wrote that I don't know who wrote that so somebody wrote it but I don't think it was me so let me just I don't think it requires correction but it requires some degree of explanation there are three vectors that really govern the price of bitcoin so one is the halving so every four years the block reward gets cut in half and if you want to look at it this way if you want to mine the same amount of coins assuming the equipment isn't any better you got to get you got to get twice as much equipment but the thing is the equipment does get better so in order to understand what that's all about you have to look at how much electric power the equipment actually uses the equipment of today uses electric power much more efficiently than past years but on the other hand there's more mining rigs so put all those things together and that's really what drives the bitcoin price the most important vector I would have to say is the halving so the equipment it can affect the price so for example if for some unexplainable reason the equipment prices were to drop tomorrow bitcoin would definitely drop the reason that the equipment prices don't shift the way they did historically and that's probably what you're referring to in that graph whoever was that did it the person who did that graph is probably unaware that starting around the end of 2002 or the beginning of 2003 bitcoin device prices established what is effectively a futures curve so if I put an order in for an s21 today I'll pay x dollars for it whatever that number is but I can as an alternative say I don't want to put an order in today for let's say December delivery I want to put an order in for January delivery actually refer to it's not a real futures market but when people talk among each other they refer to it as the futures curve or the futures market so you combine the machine futures market device futures market for January delivery and the difference between the price for delivery ASAP and the price in January is the amount of money you would have made in the interim

in

difference in game delivery ASAP and waiting till January for delivery you'll see it's actually pretty efficient so what's happened is the vector of the change in mining prices has now become completely predictable and that's something that if somebody is going to update that that graph has to be taken into account but it's not to say that there's no correlation between the the price of the equipment and the price of bitcoin it's really not the price of the equipment it's how much equipment you need to get the desired result to how many coins you wish to mine so I think had the graph been expressed that way I think you'd look at it in a different way but again I don't believe I wrote that I don't recall writing it in any way so I hope that's a good answer

you said there were three vectors and you mentioned one I think unless I missed the other two

no there is there's the having which is every four years they have there's the the price of machines and the third one is the hash rate or better said difficulty coefficient the reason I say hash I'm going to define these terms in a minute the reason I say the hash rate is because the hash rate is the easiest to understand the hash rate is the aggregate computational power of the system then we take every bitcoin mining device and add up what the computational power is some are more powerful than others some are an earlier or some are later generations they have different computational power add it all up that's the hash rate and the hash rate right now or at least I looked an hour ago so I'm not looking now with 711 x a hash xa means one followed by 18 zeros and the reason I use that term hash rate even though it's a common term reluctantly I use it because when I say the aggregate computational power of the system it's easy to understand as opposed to the difficulty coefficient which is harder to understand what you'd get to in a minute so yeah it's every instance okay I have all these computers they have a certain processing power add it all up I get it the trouble is that they don't really get it because this hash rate number is not that there's a electric cable connecting every device in the world that number the hash rate is an estimate it's an estimate it's a good estimate but it's only an estimate and it can be sometimes the estimate is based on how long it takes to solve the block if you have two weeks basically a block song activity before they recalibrate something called difficulty coefficient which I'll get to in a minute so during those two weeks a block can be solved in 10 minutes a block can be solved 11 minutes a block can be solved eight minutes well if they're solved in more than 10 minutes the difficult coefficient is going to decline if they're solved less than 10 minutes difficulty coefficient is going to go up and the computer estimates what difficulty coefficient is and at the end of that period of time the computer comes up with numbers so the hash rate is estimated so I use it with a little reluctance because they know people are going to think that they're going to say that well this is what the iRig computational power system is is if we had all these devices all these servers within our control we can actually measure it precisely we can measure precisely so basically if the blocks are being solved in eight minutes instead 10 minutes we're going to assume that the the hash rate computational power system went up by 20 when in reality it might just be randomness why is it randomness because the the solving the block amounts to guessing a number you're trying to guess a number that's what you're trying to do there's no fancy math involved you're trying to guess number now what is that number now once you understand that we what this number is you'll understand difficult code difficultly coefficient so basically you're trying to guess a number and what's called the SHA SHA stands for secure hashing algorithm the SHA 256 the SHA 256 algorithm what does that mean that means that you have to guess a number that's 256 digits long everywhere from 250 and a one to to 256 9 9 9 9 9 so the total number of values you can get is more than the number of grains of sand on this planet so it's really a big number so you would say that sounds pretty secure and when and when people say that other people say yeah but what if you get more powerful computers like what if you get like a quantum computer and couldn't it guess it couldn't computer guess it a lot faster and thereby hack the system and the answer to that is yes but it's not a problem why isn't it a problem because there's something called the diff the coefficient diffically coefficient just a coefficient in number if you multiply the SHA 256 number by to create increased number of possibilities so for example if you want to double the number of possibilities you could multiply this huge vast number by two or by three or by four or by ten and so on and so forth right now the difficulty coefficient exceeds 95 trillion so this number this 256 digit number that is a vast number of possibilities you take that and you multiply by i believe it's 95.2 trillion you create many more possibilities so but but you can know but you can never get to the end of infinity you can have infinity times infinity so no matter how powerful the computers that are that are devised you can always come up with greater difficulty coefficients so i probably gave you more information than you want on how this whole system works but i hope i addressed your question

in

the fiscal year 2022 third quarter call that he did not see much value in bitcoin developers pursuing scalability or medium of exchange technologies such as the lightning network if the price of bitcoin is ultimately linked to the price of mining rings as management has published articles about in the past would greater commercial and practical utility not drive greater transaction volumes and fees and thus greater bitcoin dominated net present values for mining rigs that would raise the price of the rigs and bitcoin alike posed another way what does management see as being the essential factors that drive mining rig value and thus bitcoin prices

okay so to begin with i just said and i just want to reiterate this that the bitcoin price is driven by the difficulty coefficient it's driven by the price of the equipment it's driven by the difficult coefficient is driven by the hash rate the price of the equipment and by the halving those are the the vectors there are three of them those are the important things now you might say well wouldn't it be great if you wouldn't have the block size limitation block size limitation incidentally for those who don't know what it is when bitcoin was designed it was designed to have a four megabyte block size limitation that means there's only so many transactions you can fit in a four megabyte block and that's it so now a lot of people when they say we got to get the scalability well we're going to have a lot of transactions those transactions then can fit into the four megabyte block size so let's expand the block size and there are many people propose that and the bitcoin holders or bitcoin miners and the bitcoin holders or the bitcoin community if you prefer that phrase bitcoin community and i include myself in that is 99.99 percent fanatical and does not want to even slightly increase the block size just don't want to do it and every effort to create a fork to modify bitcoin the increase the block size has met with unbelievable opposition when i say unbelievable opposition 99 plus well over 99 percent don't like it why don't they like it because one of the reasons

that you

have hacking

on

um the internet and all these digital payment systems is because for all intents and purposes they have unlimited block size so in bitcoin one of the things i should have said is four megabyte block size and you only have 10 minutes to solve the block so basically you got to get first and you can't have a computer that keeps trying to guess numbers forever because sooner or later someone's guest number and be able to amend the block in the way that you don't want to happen you will make it really really difficult to validate a block so the amount of money you spend on electric power is going to be more than the amount of money you can get if you're going to pursue some type of nefarious plan and so far bitcoin's never been hacked that's why everybody opposed it so when i oppose it too so the last thing we want is scalability so the way bitcoin is evolving thus far and as i said it might change the way it's evolving thus far and i'll refer you to some statistics you can see this for yourself in the moment that bitcoin is evolving in the kind of system where you don't really want to use bitcoin for a small transaction you want to use it for a relatively big transaction so if you want to send two dollars to your friend or you want to buy a cupcake bitcoin is not for that you could directly do it it's not designed for that it's designed to transfer large amounts of money on a secure basis so dollar volume of bitcoin is the biggest of all the cryptocurrencies i believe if i'm not mistaken the dollar volume of bitcoin every 24 hours is comfortably in excess of 24 billion dollars so to give you an idea what that number is it's probably more than the volume of apple the biggest dot in the s&p expressed in dollars now i'm not looking at these figures so i may be a little bit off but 24 billion dollars is a big number if you're interested in doing small transactions chances are you should go to another cryptocurrency that has the bitcoin protocol but it's set up to that because it solves the block more frequently an example might be litecoin so litecoin recently is doing litecoin by the way has a fraction of marketization bitcoin is like 1.3 trillion plus marketization litecoin on a good day is six billion if it's even six billion so it's a tiny fraction of bitcoin but however having said that litecoin does in volume about four billion dollars a day so assuming in round numbers is six billion dollar mark cap two-thirds of it is trading every day so for small transactions bitcoin has a block time of two and a half minutes so you like that sort of thing then litecoin is a thing for you or if you prefer and some people do prefer you might wish to try dogecoin dogecoin has a more expensive monetary policy than either bitcoin or litecoin but it's not all that expensive and the problem with dogecoin is doesn't have anything remotely close to the transactional volume of litecoin or bitcoin but it does manage to do a couple hundred million dollars a day and some people have said i don't know if this has any truth or not but some people have said it seems reasonable it's possible that what was once known as twitter and is now known as x could find a use case for dogecoin by making it the transactable currency in that social media so you want to exchange value maybe it'll be dogecoin maybe won't be i just don't know but that's a possibility so bitcoin was never designed to be all things to all people and i don't think the holders of bitcoin are ever going to accept that there seems to be no evidence for that and if they did accept it if then the people who are purists which at the moment is way over 99 percent of them are going to go to another cryptocurrency and you'll never stop the bitcoin people because they modify bitcoin if somebody actually did it the purists will just have unmodified bitcoin because it's all open source code so nobody's stopping the innovators if the innovators want to have a much bigger block size they can create they've done it already several times and they can invite people to use it but every time they've done that they've done it i think half a dozen times nobody comes and use it now i say nobody it's virtually nobody some people do want it but it's a minority so i guess that seems like

what

i have to say about that subject

so what's next to us so regarding

one of frmo's smaller ventures venture investments how does diamond standard solve the logistical and security issues with a physical coin or other asset that is supposed to be tracked on a -to-one basis on a digital blockchain for example it doesn't seem like anything stops someone from physically tampering with and removing the diamonds from the coin or bar from the resin itself and replacing them with fake diamonds before trading the physical asset etc is it physically impossible to remove any diamonds from the physical asset without such tampering being detected by the onboard technology what happens in issues of disputed tampering

well but there is an there's an rf code that goes with it so if you you can certainly break the resin open and you're going to damage the transmitter and i don't know how you can get around that so that basically makes the coin automatically authentic and anyway and the the gem logic institute of america will not honor a a gem certificate is certified by the gem logic institute of america so if you mess with it i don't think anyone's going to validate that so i don't think that's a realistic

risk i wouldn't much about it's very hard by the way to counterfeit diamonds

so you can always if you were doing things like someone could bring a ring in to be engraved it's a diamond ring and it's happened they take out the stone they put in a much less valuable stone the average person wouldn't know

but that's what you have appraisers for so it gets detected pretty fast

incidentally you have forgeries and i wrote about this recently in the world of art it's actually more common than you believe you also have forgeries in the world of rare wines it's also common but it doesn't stop the wine market doesn't stop the art market and i don't think it's going to

the

diamond market

with modern technology you can validate all these things

okay

during the 2023

shareholders meeting a question was brought up regarding a firm of stake in the rent fund and a large holding of the fund in apex medical as well as some questions about the history of that ceo's that company's ceo charles goodwin management revealed that there was an informal promise not to sell apex without the agreement of the prior fund management my question is is that agreement expected to last indefinitely that is is there no corresponding informal expiration on holding that company like say if the investment doesn't work out within some period of time by my accounting the company has not had positive return on equity or return on invested capital since 2013 and it's not improved much while being held in the fund or since hk horizon kinetics has taken over management of rent at what point does fund management have an overriding fiduciary duty to deal with the position based solely on its fundamentals on behalf of their shareholders okay

to begin with horizon is solely responsible for success or failure of that position if we feel like selling it we're totally at liberty to sell it we could sell it tomorrow if we feel like it or if we want to keep it we can keep it so what happened to that company is the the chairperson that you note resigned on a certain day in may and a new person took the helm and is developing a very different marketing plan the problem the company really had wasn't in technology a technology works well problem is in marketing so what you really want ideally is there are these renewable i don't know what the right word is there are um i'll call them applicators i don't think the company will call them applicators but they're applicators so basically it's a skin treatment and you need this applicator what the applicator basically does is it burns away the top layer of wrinkled skin and the technology actually works actually works very well so if it were used more frequently by people then basically you you can't reuse the applicators you'd sell more applicators and therefore return on investment from everybody's point of view will be a lot higher so the really marketing challenge is to tell people about this procedure and it has an amazingly high high success rate and if people use it more it'd be just great so this person who took office recently the person marketing specialist and the person who developed a plan to address that issue that person came in in may this is october we got to give the person a chance and let's see if the person's going to be able to succeed or fail so it took a few months to develop the plan the plan was deployed in late august early september the little information i've had so far is it seems to be working well let's give the person a chance it doesn't work well we can always dispose of it but we're at liberty to dispose of it anytime including tomorrow if we are such if

we are so inclined okay management has expressed

the intent to convert frmo into a crypto mining business eventually plans to list to a higher visibility exchange and has recently added the company's digital asset ownership in its most recent quarterly filing given the intended direction of the company would management consider providing look-through reporting of frmos or winlens broken down broken down or aggregate mining metrics such as hash price hash rate energy cost from its mining operations and hash rate capacity factor of rigs other public crypto mining operations such as terror wolf report such metrics and having these metrics reported by frmo may be useful in analyzing differences in trading multiples between frmo and other miners for example this would allow derivation and comparison of things like operational costs and bitcoin revenue versus hash rate and understanding where various public operators stand along the cost curve in relation to frmo

okay no problem providing any of that information i'm certainly willing to do it there is some other information that you're going to get that is none of those figures it's just additive we're not going to hide anything there's some other information that you're going to need to properly evaluate and you can get that information too so give us a chance right now we're in the process of improving our operations it's pretty good right now in 90 days i suspect it's going to be better can't guarantee that i think it's going to be better and we're ready to provide any and all information and i think when you compare it to other firms i think you'll be very pleased with the outcome but i'm delighted to provide any information that people want

there's no secrets here please

explain how horizon kinetics holding corporation being public will impact frmo financial statements starting next quarter and what it would mean today based on latest horizon kinetics holding corporation air price offers of about 24 dollars and last reported financials

well it doesn't impact the financial statement as such the numbers you see in the financial state because we can continue in horizon to use the equity accounting method the only differences that you can figure out from the financial statements what percent we own horizon kinetics you know what the mark capitalization is you can take their percentage and multiply by the mark capitalization you can see what the market value of horizon exposition is if it's bigger or smaller than what we carry it on the balance sheet for so you can get a different look doesn't mean it's a better look you can get a different look than you get by just reading the financial statement we didn't bring it public for that reason the only reason we were public is that one of our founding members unfortunately died and the estate has to be settled and the state needs the money so the fairest way to value it for estate purposes is the market you might like the price you may not like the price that's the fairest way and that's the story basically horizon kinetics didn't need any capital was looking to raise any capital got plenty of capital

so

that's

actually what happened

explain then what dividends shall be paid by i'm going to call it hkhc for example quarterly dividends and a year end extra perhaps it is obvious that hkhc earnings are dependent on whether performance fees are owned by its how many hedge funds which can only be determined at year end of the funds fiscal years are the fiscal years are the years fiscal or calendar what is the total approximate market value of how many hedge funds hkhc manages today

okay to begin with we're on a calendar year so you'll find out the performance fee at the end of the year i guess you'll find out in january we'll find out on december 31st um we intend to pay a quarterly dividend and we get a performance fee and there'll probably be an extra dividend we're a public trade company can guarantee is going to be a performance fee but um where the board's going to meet look at the financials and um we'll decide what the dividend is going to be and there'll be a public announcement whatever it is and if we're so lucky to have a performance fee you'll know and there may be a dividend associated with that as well um what is the market value of all of the performance fee products together um i don't know it off top my head um we could probably get you that number just understand um on the performance fee there's two dimensions to it so we have funds that hold private securities that we accrue performance fee we don't realize the performance fee so if the investment were to be realized we would collect probably several years of performance fee in one year that could actually happen so i'm reluctant off top my head to give you the number because i don't remember it number one and uh so it's going to be inaccurate so i don't want to do it but it's no secret i mean we can get you that number and the second thing is when you look at that number you're going to have to divide the the performance fee eligible funds in two categories those that accrue and collect the performance fee yearly because they're probably trade securities and those that accrue but do not collect the performance fee yearly because it only can be collected when there is um a realizable event so you'll need that information and um i guess

horizon

kinetics will provide it

because

people

are probably going to want it okay what is the -to-date performance percentage

of these funds

year date performance um well again i don't want to quote number um because i don't remember the number off top my head and i'm sitting here i'm not sitting here with a sheet of paper that has a number on it um let's just say the number is satisfactory and i'm sorry to be so vague a bet but that's all i can do at the moment

i

don't have a number

in front of me but we'll get you that number do all of the funds own tpl

texas specific land corporation and if so how many shares of tpl are in these performance funds

okay again i don't have a spreadsheet with all those numbers i never really needed it myself um we can get you all that information horizon is probably going to be asked all those questions and it'll provide all sorts of information not all the funds have tpl as an example i alluded to earlier we have some private funds tpl is a public trade security if we have private funds we own privately traded companies tpl is not going to be included in that so tpl is not in everything but to give you the actual numbers off top my head i don't have them but i'm sure horizon and due course will produce all that information remember it's a horizon those are horizon statistics not necessarily for most statistics but i'm sure they'll produce all those numbers

another tpl related question how many shares of tpl does frmo own today i actually looked it up around 230 and it's if you want me to disclose it

well if you looked it up then it should be disclosed right let's disclose it okay

it's 20 24,024 shares at fidelity and i don't know

are you sure are you sure i don't think that's the number therese i think you're wrong about that

oh you know what i didn't include bromax either so you're right well that's

number one and number two you have to include the proportional shares that we own indirectly through the various funds which is on that sheet of paper that you normally provide which i don't have right now but supposed to be on the website is it indeed on the website

i believe it is and if it isn't we'll make sure it is

why don't you look at when we take a deep breath why don't you look at the website and read the numbers and the date they're accounted on and give everybody

information okay in the meantime i'll give you another question

same question okay we know what let me while you're

looking at now let's not go over another question let's deal with this question and meantime while you're looking for that number i will tell people this is why i don't keep these numbers in my head because as you can clearly see even if you have spreadsheets in front of you you can read the wrong line it's not as easy as you might think there's a lot of numbers to keep current with and it's easy to confuse one number with another number so that's why it's best to website where a separate human being or i think it's a team of human beings calculates these numbers and that's why we have the website to provide people these numbers which i'm hopeful you'll be able to find those numbers presently how you coming

i do have the number from that spreadsheet i'm getting it okay from our files but i'll make sure it's on the website okay is on the website now let me ask you okay

that sounds right so so what is the number let's repeat that number with number

100 159 101 okay

that sounds now that number let's just specify if that's indeed the right number where are you getting that number from

from the spreadsheet that we had we had for this quarter for the okay

and what is the board looked at that's what we understand

but

what is the date it's what month and

date it is as of august 31st 2024 okay

and what does it say what is the heading of that says is to say our proportional ownership does it say what does it say because it's not our direct ownership it

would

have to be

no direct ownership

and our proportional ownership

and that's why you're the ceo okay because

what you might be looking at to raise just that so i'd say be careful you what you might be looking at is you may be looking at the number that includes all of the shares of the hk hard assets and not all the shares hk hard assets belong to the frmo because there are other investors in hk hard assets so you might not be looking at the right number

i'm looking at held indirectly through public and private companies so it's proportional but i was not including what's held directly so that's why don't we do

this okay well go ahead say what you have to say well

add the how directly that number is indirectly okay well let's just give the indirectly

and directly number well give both numbers and people can add them up

okay

what is the direct number

20 direct number 29 29 514 and the held indirectly this is proportionally calculated is 159 101 okay

so our total ownership is obviously

some of those numbers okay that's good okay what's the next question i hope we address that next

question same question regarding land bridge and with respect to that did any of the above or any of the hk hc entities purchase shares at the 17 offering price with respect to shares of frmo the hedge funds hk hc of which we own almost five percent shares is that correct and purchase of land bridge shares at what cost today

yes well we obviously purchase shares on the initial public offering we purchase shares subsequent we have a certain number of shares and there's some spreadsheets somewhere that will tell you exactly how many shares we have and if you have that you can read it if you don't have it that's fine

i don't have it

okay well it didn't come up on a spreadsheet because now someone's asking and i guess it's another number you'll have to put on your spreadsheet so you can go back to them calculate those numbers if you don't have number shares obviously the other answer to the question you couldn't have as well so you'll have to gather information

okay we'll do hk hc yep

um hk hc appears to have allocated the 80 million dollars worth of land bridge acquired at 17 to all of its investment advisory clients is that correct what is the average fee hk hc earns net on the investment advisory accounts it is obvious that land bridge shares have tripled in price and values and so will be a very meaningful source of hk hc revenues and profits and hence book values each of which we own almost five percent interest positions at the same time if hk hc is going to pay a dividend and particularly a special dividends at year end or will it be next year in the first quarter we frmo did actually receive a meaningful amount of cash from dividend payments bottom line i am trying to get at it the it's clear that the assets of hk hc managers that the assets that hk hc manages should have meaningful positive revenue and earnings results the way things are going in the markets and therefore frmo investments and revenues and net worth of hk hc should be significantly benefiting okay

so let me just start so when we purchased 80 million dollars of land bridge it wasn't all our money it was also purchased a lot of it was on behalf of the clients so as per how much was given to clients how much do we have in hk hc and frmo and etc etc etc i don't have that number to hand as you heard but they will make every endeavor to get you that information now in terms of the directionally you know the earnings of rise mechanics let's say this i said something similar at the annual meeting so really from 2007 to maybe the end of 2023 a period of let's say 16 years as a value investor we made money but relatively speaking as a value investor to other investments one could have had let's say mega capitalization technology investments we underperformed we didn't underperform each and every year but viewed cumulatively over 16 years we did so that affected our asset gathering and also affected the market value of the assets upon which we can charge that changed depends on what month you want to look at it but at some month in 2024 what month was it that reasonable minds may differ but it's gotten a lot better so why has it gotten better that's one question you might want to have which i'll address momentarily and why didn't we do something sooner to address that and i'll address it right after first thing why has it gotten better because the amounts of assets that have to be gathered to build data centers it's in the trillions of dollars just the united states america but that doesn't measure it because data center is a worldwide phenomenon so it's some incredible amount of money it's going to be spent over next five or six years and beyond that no one can see except the spending will definitely not end five or six years from now so that's going to put a severe strain on all kinds of hard assets that's why we're positioned in hard assets because that was our forecast and it finally came true and that explains at least 2024 performance so you might ask well why didn't you in the interim buy the other things sell them at the opportune moment in or sort of swap them for the hard assets perhaps not entirely but largely since the the mega capitalization technology stocks are extremely liquid why didn't you do that well the couple answers that first answer was we didn't get it right we thought the mega capitalization technology trend was going to end in 2019 to 2020 and we might have been right were it not for the fact that a small thing like the coronavirus happened that led to the work at movement and education home and all sorts of things that probably nobody could have predicted and that gave the technology companies an extra three or four years lease on life that prolonged

our periods of

less than desirable performance and the second thing was that even had we executed perfectly wouldn't have helped us at all so you might find that an astonishing statement so i'll try to defend it that basically in order to outperform the s&p 500 with technology we have to have more technology s&p 500 that's pretty obvious so in round numbers if you looked at the s&p tear sheet today in round numbers i'm going to ignore decimal points the s&p the way it's calculated is 32 weighted in technology however i don't calculate that way i calculate that number is 42 percent in round numbers and how dare i to argue with such an obvious calculation well because facebook now known as meta platforms and google now known as outfit and amazon are not included in technology group even though everyone knows perfectly well they are the largest factors in the data center movement so amazon is in the consumer discretionary sector and meta platforms now bet in the communication sector so technically speaking the manner in which it's calculated it's not technology but it is technology so now you're at 42 percent so you might say well why didn't we put 50 percent in technology and be it and we would have beaten it but it would have helped us not at all why because no one would have compared us to the s&p 500 we have 50 technology and rightly so we would have been compared to technology funds they're 100 technology and we've underperformed anyway so it would all have been for naught

we knew that in the beginning so it was a very difficult period and sometimes you just have to accept that

not that we didn't make money for our clients it's just that we weren't going to alter ourselves that way and larger the largest part of our money is high net worth individuals they're all taxable and then at some point we had made this transition we would have paid a huge tax bill and to one end now if you look at the funds and the mutual funds are at least publicly traded look at it you can look at it right now look at our record relatively s&p and i think that the record speaks for itself so you can look at the return up to september 30th that's the most recent numbers there are there it's on the website look at it i think the returns at a paradigm fund or small capitalization fund as examples i think they speak for themselves and you can be the judge whether with whether what we did was smart or not but it was we weren't going to help anybody by doing a lot of trading and making everybody pay a lot of taxes we probably wouldn't have had the returns we even had that's the best way i can answer it anyway there are already returns

you can look at them in no secret they are what they are and i think they're pretty good if i do say so myself isn't it also because

of the difference between our fiscal year and the calendar year of hk hc and the time lag and frmo reporting the full results from whatever it's good fortune frmo is not likely to see any of it until our fiscal fourth quarter and annual report ending in may please elaborate

that's not true we're on a cruel counting so in the event we collect the performance fee and there is a dividend we own shares which is extraordinary if we own shares of frmo we own shares horizon common which we do well in that horizon common horizon kinetics which we do we're going to get that dividend and it'll be received at the exact same time everybody else receives their dividend and it'll be booked quite appropriately don't forget in the case of frmo it's not just a rising kinetics dividend there's also the revenue share so it's a big performance fee there'll be a very big revenue share and now you judge now you can judge why we never wanted to change the revenue share or sell it because one day there was going to be a big performance fee and we would collect a lot of money now can't guarantee you it's going to be a big performance fee if it is if there is one we're getting it when we're entitled to get it and before we get it we're going to be required to accrue it

so you'll see it in the financials okay now several

a multifaceted question on data centers is it likely or unlikely to see data center construction in the Permian basin of the multi-million square foot variety most observers and many high-tech firms seem to be saying there will be a need for 10 times more data centers than presently exist in our country larry ellison in his last conference call actually said he needs 10 times more do you have any idea of whether that means 100 or 200 or 300 000 square foot data centers or two to seven million square foot data centers facebook already has a seven plus million square foot data center in oregon i believe won't size of this center determine how many will be needed

uh not necessarily all i can tell you is data centers primarily that are going to be built of the hyperscale variety hyperscale data centers are in the millions of square feet if you think that's a lot i think again next generation is going to be exascale data centers much bigger than that it's hard to even visualize what they're going to look like so the amount of data that's going to be needed to provide the services that people seem to want to desire by the way i'll interrupt myself by saying i personally just speaking for myself as a human being not for frmo not for eyes and just for myself as a human being i have no interest in having any of those services personally but that's just me everyone else seems to want it so let me tell you why no matter how many data centers are built it's not going to be enough so the the data center model is that we're working with is derived from the internet model we have in that model we have it's clearly an advertising model so you google something and you may or may not that may or may not result in a purchase but it's a financial transaction in the sense that people are paid just to direct traffic to different websites that's why you have a term called traffic acquisition costs so it's might be the biggest business there is online commerce okay now so tremendous amounts of money are being spent to attract people to choices between millions hundreds of millions of websites or web locations so now let's do a hypothetical just so you understand how much data is needed you decide for your anniversary you and your wife are going to attend a broadway show you're going to go to the wednesday matinee because it's not that crowded and you walk out of wednesday matinee and it's about 4 30 and you really enjoy the show and you want to have dinner and they're all your dining choices in the city of new york and it's not unusual to suppose that you and your wife might look at your smartphone and see where the available dining choices well the available dining choices want to market to you must have this experience you're looking at something on the internet you're texting someone or you're emailing someone and all of a sudden you get some type of notification that's something you're very interested in is available right nearby well one of the things that's going to happen actually it's happening right now you have 336 million people in america and during the bulk of the day they're using some type of handheld device and they're being tracked in their location their dining choices are being tracked their purchases are being tracked not for any nefarious purposes just to sell more goods and services or if you prefer this phraseology to make the advertising dollars more effective so think of how much data is required and it's never going to end because your preferences are always changing and always learning more about you and your location is always changing that in itself is virtually limitless think of all the transactions in new york stock exchange all the information you can get from that think of all the financial information the eternal revenue service needs think of federal aviation administration that not just wants to but wouldn't it be great if they could track all the birds that are in the air because every now and then a bird gets into an engine causes a plane crash so if the faa through radar could may could could track all the birds we'd have safer airline travel so more accurate predicting of weather requires more data go on and on on like this the amount of data that's required is limitless so here's a cystic i gave someone the other day they were shocked but if you can't if you count self-published books because now you can on amazon you can publish your own book you don't need a publisher how many books yearly are published in the english language books table of book is 350 400 pages the answer is somewhere between four and five million and they're all online can you imagine how much data that is it's so much data that nobody can ever read them all even the entirety of population

couldn't read them all so

what can you do you have to read them through devices and devices need to summarize them that's chat gpt then how many scholarly articles are written how many tweets are written how much social media instagram chats texts emails

videos people take photographs security cameras etc etc etc so

what establishment whether it's entertainment or dining or shopping or education airports doesn't have a multiplicity of security cameras and the video is data rich you never know when it's going to be needed but it's conscious cumulative it's constantly being added to the system so it's mind-boggling how much data there is it's being as let me just quantify it for you the numbers i'm going to give you they bottle the human imagination right now according to the people who claim to know this subject we have in the world today stored and it's increasing we have 100 what they call zettabytes zettabytes what's the zettabyte one zettabyte is a trillion gigabytes so that's how much we have right now and the people who claim to know this subject project that six months from today we're going to have 200

zettabytes that's in six months so it's an astonishing amount

of data now where is it stored on servers obviously where these servers it's just a big electromagnets that's basically what they are and they're constantly on because they have to be constantly on because you never know when someone's going to want data so and then even if you could turn it off for a while the energy cost of turning it back on and powering up that system is more energy cost is leaving it on perpetually so it's on perpetually and the energy requirements to run the system like that globally is mind-boggling so it's going to have its impact on commodity prices particularly the price of natural gas which is going to end up being the fuel of choice and that gets back to an earlier question of why the way we're positioned because the river was flowing in a certain direction was coming to us so all we had to do is wait we didn't have to do anything really and we didn't it's called intelligent inactivity so it's incredible what's happening in the world now having said that i started this answer out that speaking for myself as a human being i don't require those kind of i'm personally delighted to go to the library and sit at the desk new york public library and read the hard copy if i really want to go to the movies i'm happy saturday night to go to the movies and watch what comes on the screen i don't need to have netflix at 3 a.m but i'm one person that's not what the world wants so you might call it progress and maybe it is and that's the direction the world's going and it's going to go there whether i object to it or not i don't personally object to it i just don't participate in it but that doesn't mean the rest of the world isn't going to do it so it's incredible what's happening it's has a good side and it has a bad side and the bad side or one of the bad sides is going to be a insufficiency of resources and not just for natural gas more importantly in its efficiency of water for cooling these data centers and we'll see how far it goes

so

sorry for the elongated

answer but that's the answer okay

given hkhc is very significant has a very significant investment in land bridge it is of course very clear you expect good things from that company the company chairman made very clear his intention to have the company be home to data centers moreover the majority of land bridge land only has surface rights so the conclusion is obvious in the case of tpl that which should be obvious is by no means obvious all the requirements for data centers would appear to be plentiful at tpl not just cheap land on which they can build but not just plenty of water for air conditioning and gas to power turbines to generate electricity but also on which to place windmills and solar does tpl have markers seeking customers for data centers or is their phone ringing off the hook and if not why from all the companies that need 10 times more data centers as mentioned above since larry ellison in particular just told the world that he needs what he needs why wouldn't tpl have already been courting him and others why hasn't tpl made a peak with respect to data centers okay

well first of all i don't wish to be and i really shouldn't be the spokesperson for tpl on data centers or anywhere else let's just say demand is going to be extraordinary and i don't think there's going to be any problems in having a great outcome at tpl in my humble opinion and i'm going to leave it at that and those questions which are really great questions they're best addressed by the company but i think it's going to have a great outcome my personal opinion and you know how much stock we own i obviously believe that i mean it sincerely we'll see what happens

okay this is also about tpl and kind of related to what you said i know you're not the complaint department for tpl but i'd like to mention to you as an accessible insider today that when tpl holds its conference calls they only last a little less or a little more than a half hour versus every other company in the world that schedule an hour an frmo always a lot of time for all the listeners to ask all the questions they want to ask even if it means reprising the conference call which of course you have done tpl takes questions from two and sometimes three so-called analysts only that appear to be from institutions that frankly appear to be bottom ranked ones the cfo and ceo who speak never allow any other questioners and despite the passage of only 30 minutes they don't even say we'll see you again in three months like every other company does as a matter of fact everything they say seems like they're reading from a script as i say you are not the complaint department would you do something to change the way these calls work and see to it that they allow more questioners with more questions to be tolerated please the two top executives do act like they care not a lick whether they make friends or positively influence people is the board aware of this you don't have to answer but you might share this information with this question with them ask them what the purpose of a conference call is when the two executives make it clear they have a strong distaste for taking questions quarterly from shareholders shareholder representatives or heaven forbid shareholders well

to begin with i don't think anybody the company has a strong distaste for taking questions i think everybody is interested in getting questions i think everybody in company appreciates interest in the company and i know that to be true and i don't think their conference call format is radically different than the conference calls i see at the biggest capitalization companies i'm on a lot of them and they don't last any materially different amount of time than what you a user questioner described so best thing to do is pick up the phone and call someone in management and i have extreme confidence that they will engage with you and they'll get you an answer to your question speaking for myself and what i do so i think i think this is true i believe it's true in the matter of time we're willing to spend with investors and answer all manner of questions so i'm prepared to stay here as long as i have to stay and i'll answer any question anybody poses to me until you run out of questions that's my practice but you know i'm not faulting anyone else i don't think that's a standard practice of the typical corporation but again i'm not faulting as far as tpl goes i have every confidence they'll address any questions they receive i think just pick up the phone and engage and i think you'll get a good

response

it's my personal opinion

okay and the last question by the way when will hkhp be reporting its september quarter we resolved and will you be holding a conference call and when might that be

okay we definitely are going to have a conference call i don't know if a date has been scheduled yet because i'm not the person who scheduled them but whenever they schedule a conference call take my word for it i will be there i'll handle it in the exact same format i will answer every single question i think the way it works is the board first you know this is the first time they've done through this exercise the board reviews the financial results the board the order committee approves the financials we approve the financials for release there's going to be a press release and then there'll be a quarterly conference call for investors and you'll ask all sorts of questions and even though i try do my best to address everything i may not necessarily have as i had i may not necessarily have the answer statistically to every question at my fingertips but we'll get you an answer and eventually the way to deal with it is if they're important statistics well do we do an fmo we'll have a series of tables beyond the website and you don't have to ask it'll just be there and if we miss something or you think of something that wasn't asked before we'll put it up there because there aren't any secrets really you have every right to know and i'm proud of it i'd like to give you the statistics i have nothing to hide so i don't know what shareholders always want but i'm happy to write everything that's within my power to provide just understand that i don't memorize every number so i'm reluctant to give you a number i haven't committed to memory with that with that qualification i'll release everything and everything that legally is permissible to be released

Well that was the last question. His

last comment was thank you for taking my questions Mr. Stahl. We appreciate you and how you personally operate. Okay well thank

you very much for that compliment. It's high praise indeed and so i think maybe i've been maybe i've exhausted everyone's patience but if we if you think of a question that's a good question that occurs to you in the aftermath of this meeting don't hesitate to get in touch with us we'll get you an answer and of course we're going to reprise this in about 90 days and we're going to do in Horizon Kinetics conference call as well and look forward taking questions so thanks for being great audience lots of very intriguing great questions and look forward to doing this soon. Thanks very much and i'm signing off now.

Thank you Murray. That's the end of the conference call you may now disconnect.