SPOOKY SZN CONTINUES
10/22: Tuesday
Markets
1. Markets basically remained unchanged yesterday due to a mix of good performance from some stocks and horrible performance by others. McDonalds fell over 3% due to missing earnings. Boeing is getting slammed because the 737 Max got pushed back and it looks like they tried to scam the FAA. Some investors aren’t even pricing in a recession to me which is crazy because the data is there. Whatever tho.
2. Ratings agencies are back on their bullshit. In the previous Great Recession, ratings agencies (the ones that basically give companies and governments their credit scores) basically stamped all the shitty mortgage bonds with higher ratings than they deserved. This convinced investors that the horrible mortgage bonds they were investing in were investment grade. This was part of the fuel that led to the fire which was the Great Recession. Now today Companies are borrowing at the highest levels in history and they’ve been slow to reflect that on their credit ratings. Companies are receiving inflated credit ratings and are using those ratings to borrow OD.
3. Stocks and bonds have been moving higher in tandem this year which is rare. Usually the relationships are inversely related. The S&P is up 20% this year while bond inflows are the highest in years. This is interesting to watch. I gotta do some historical research to see how things ended up the last time this happened.
4. SoftBank convinces the WeWork board to let them gain controlling ownership in the company. This is HUGE. Startup founders gotta be watching this in awe right now. We’ve seen CEO’s die before but never like this.
5. PG&E is back with the blackouts. 200,000 people in California will have their power shutdown AGAIN. PG&E has been fighting both bankruptcy and the California wildfires. This is a horrible combo. Some people are considering state run energy companies in Cali due to this mess.
6. Brands are considering cutting their influencer budgets. This year they plan on spending over $8 Billion but their starting to realize that the returns aren’t really showing for the money they pay. This Instagram shit is about to get real spooky.
“Yeah those likes are real bruh”
7. The Federal Reserve pumped another $100 Billion into repo markets because banks are still reluctant to lend to each other at the rates the FED wants to maintain. Their target is about 2.25% and banks are still lending above that rate.
8. Stamps.com just entered a partnership with UPS which caused its stock to soar over 22%. I’m not into breaking law but man that would’ve been a fire insider trading play.
9. Since we’re on the subject of insider trading…. Vanity fair magazine recently released an article alluding to traders and Donald Trump doing insider trades based on Trump News. It’s probably the dumbest article I’ve read in a while. Tbh in my opinion it’s highly irresponsible. Just because your readers aren’t financial managers doesn’t mean you can make articles like that for clicks.
10. Existing home sales in the United States fell over 2% in September. It’s either a cyclical thing or the market is getting soft. In my opinion home prices are too f*ckin high right now. Something needs to happen and fast.
10/23: Wednesday
Markets
1. Markets basically remained unchanged today. The bad earnings reports came in. Travelers insurance tanked off of bad earnings. Nike got it’s face punched in, Home Depot got slapped, but Apple and Merck finished at record highs and Facebook popped. It’s still SPOOKY out here.
2. Mark Zuckerberg did decent in his congressional hearing today in DC. Congress still doesn’t know how Facebook works. Congressmen out here looking like my grandparents when they talk about social media.
3. Adam Neumann (Former CEO of WeWork) is a LEGEND. After spending years of burning through cash, buying a bunch of fancy cribs, buying a private jet, and completely botching a $40 billion IPO….. he got a $1.7 billion payout…. WeWork is currently worth $8 Billion right now. He got paid almost 1/4th of the company to leave it behind. SOMEONE TELL ME HOW TO GET A PAY PACKAGE LIKE THAT BECAUSE I WANT NEXT.
Adam Neumann be like…..
4. California legalized weed a while ago and everyone expected it to solve a bunch of problems…. And it did… but the weed black market is STILL lit. Why? Well to go completely legal in California it can take up to 5 years. In that 5 year span it’ll cost you about $50,000 just to get all the permits and approvals to open your doors. That’s before the cost of actually setting up your business and during that 5 year period you can’t make money. Sometimes government intervention can actually make life harder.
5. The CEO of Nike (Mark Parker) announced that he is leaving the company. (Also part of the reason why Nike got it’s ass kicked today) He is being replaced by the former CEO of eBay John Donahue. I’m not gonna lie this is actually not a bad move. We all love Mark Parker and he ushered in a fire era of branding but internal company culture at Nike still needs some fixing. Also fresh blood could be used moving forward. I actually think Nike can be better at playing the eCommerce game and Donahue is a street legend, he can help in this arena.
6. Through Amazon’s large distribution chain people have found that Amazon sells clothing made from factories that other retailers have banned because of worker safety hazards. People are coming for Amazon from 90 different fronts but in my opinion they keep missing the target because they aren’t going after Amazon’s core business…. Amazon Web Services (their cloud based business). Amazon actually is able to subsidize all of their other businesses because of Amazon Web services. News people don’t read balance sheets, they just chase stories. Don’t let the news play with your feelings…. Search for facts.
7. Low rated bonds (also called junk bonds aka anything rated BB- or below) are getting ignored by investors and the companies with these ratings essentially can’t get a loan. This is putting those companies in a cash crunch and pushing them to the brink of bankruptcy. Some look at this as fear, but private equity firms look at this as opportunity because they gonna buy them out via rescue plans. This play is Wall Street 80s all over again.
Good News
8. Facebook is dedicating $1 Billion to creating affordable housing in Silicon Valley. They plan on building 20,000 housing units in the next 10 years to help alleviate homelessness and high apartment prices in the area. I don’t know why this isn’t bigger news. I’m kinda pissed about that tbh.
9. Opportunity zone funds aren’t getting as much investment as expected. For those who don’t know…. 2 years ago the Federal Government carved out areas in the US where uou can invest in real estate and get tax breaks for making those investments. It’s partially what played a role in gentrification in big cities because areas in your hood probably qualify as opportunity zones. Aka those new buildings on your block are getting tax breaks from state, local, and the federal government. There are funds out that that can invest it for you (be careful tho), or you can invest yourself. Me and my homies made a real estate holding company to make this play… you should make a play too.
10. Over 6000 people passed the New York State bar exam and will be newly minted lawyers soon. Fine one, keep their phone number, and build with them. As bad as people say lawyers are…. They are the gate keepers of our legal system. They write/enforce/change the laws that you and I live and follow so if you really trying to get ahead (or stay out of jail) you need one in your pocket. Congrats to those who passed the bar this month. Your hard work paid off and you deserve all the glory.
10/24: Thursday
Markets
1. Markets were mixed. Boeing dragged the Dow Jones down but the Nasdaq (an index led by tech companies) had a pretty good day closing 0.8% higher. The S&P basically remained unchanged.
2. Twitter is down 20% as of the close today. Yes. You read that right. 20 f*ckin percent. I can’t believe what I’m seeing right now. Twitter missed their earnings big time. Ad revenues? DOWN. Apparently, there’s a bug in their ad system that really screwed up the metrics leading them to miss out on $50 Million in revenue. Dear God, I pray I never have a bug that lets me miss a bag that big. In your name I always pray…. Amen. I think this is a glitch tho. Tiwtter is actually a great company even though investors are worried about their long-term potential. I’m not saying buy at this price… I’m just saying that I plan on buying at this price once compliance clears my trades at work.
3. Fannie Mae and Freddie mac (The US largest mortgage providers and effectively a government entity) are going private. The government plans on selling them back to private hands and the country’s top banks are figuring out how to raise the money. Fannie Mae and Freddie Mac became a government entity during the financial crisis because at the time they held the largest amount of trash mortgage bonds and the government had to save em or else the country would’ve been in ruin.
4. Microsoft had a fire earnings season y’all. The 3rd quarter was LIT. Microsoft Azure had over $10 Billion in sales (up 27%), Microsoft office had over $11 billion (up 4%). The stock is boomin so much that the company reached a $1 TRILLION valuation. Making Microsoft the worlds most valuable company. Shoutout to @shaaztastic for making the company better. It might be his vibe helping the boost. (I’m kidding…. Maybe I’m not lol)
5. Tesla is also boomin. Specifically the Model 3 is boomin. Out of the 97,000 cars they moved last quarter the Model 3 accounted for 82% of those sales. It might be that it’s lit, it might also be that it’s an electric car selling at $39,000 and it’s fire. It might be both… I’ll let you be the judge.
6. It’s looking bad for the semiconductor industry (those little chips in your computers and your phones). One of the largest chip companies Texas Instruments reported horrible earnings. Sales in the 3rd quarter were down 11% and they project that sales will. That China Trade war tech hate getting to the industry. It’s getting cold out here.
7. ISIS out here WILDIN on TikTok. These dudes been on the app posting execution and torture videos and they made it live. That’s crazyyyyyyyy. It’s the first huge issue for the new video app that’s been eating up the social media space. In my opion it’s the best standalone video app since Vine. RIP Vine.
8. WeWork employees might actually get NOTHING for their shares of shares of stock they own in the company if they sold it today. That’s how much the company lost value in the last 2 MONTHS. Y’all lucky I don’t work for WeWork because someone woulda caught these hands.
Housing
9. In a clever way to make the state more affordable to live Oregon passed a law in June that rezoned all cities with 25,000 or more people to allow homes with multi-family units. The max is currently 4 units. The goal is to allow more apartments to be available which in theory should bring the price down. I hope it works because hella folks are fleeing San Francisco and Silicon Valley in search of cheaper housing.
10. I don’t know if I’m supposed to panic or not but the FED raised its minimum amount of repos (overnight loans to banks) to $120 Billion up from $75 Billion. If you’ve been following The Dime, you’ll see that the FED been blasting out nearly $100 Billion a day and yesterday they up and say “the new minimum is $120 billion a day” I’m kinda shook. Banks really ain’t lending to each other right now and the alarm is really sounding. I’m praying that this is under control.
10/25: Friday
Markets
1. Markets were a mixed bag again today. The Dow ended lower, the S&P is flirting with all-time highs and the Nasdaq cleared out a little over half a percent. With all this earnings news things have been a little….. Spooky.
2. Amazon didn’t have a lit of a 3rd quarter. Remember that “one-day shipping” thing? Well it’s turning out to be pricier than they though and ate into their margins. Tbh I think it’s too early to count it out. They just started it last quarter. They’ll get it right soon. They better.
Society
3. This news is hella depressing. Fentanyl has played a role in 39% of overdoses. Yes. 39%. The states hit hardest are in the middle of our country. Iowa, Missouri, Kansas, Nebraska. Please if you’re in need of help don’t hesitate to reach out to me personally yo. Too many beautiful lives are taken away by these awful ass drugs.
4. Remember a few weeks ago when The Ivory Coast and Ghana decided to put pressure on the Cocoa market and put their farmers first? Well Nigeria and Cameroon have followed suit and even raised the stakes a little. Nigeria and Cameroon have also factored in a “Living Income Differential” which adds $450 on top of the base cocoa price in the market. This is going to push up cocoa prices and put more money in the farmers pockets. I love it. Even though chocolate is going to cost us more money….. I don’t care. #PayTheFarmers
5. According to some statistics, business activity is slowing all over the world. This is due to uncertainty in global trade. This trade war is hitting hard. Manufacturing orders have fallen, exports have fallen. It’s getting wild and it’s only but so long until the market feels it.
Homelessness
6. So, the US Department of Housing and Urban Development did a study and found that there are almost 80,000 homeless in New York. 80,000. And it’s crazy because living here we see them so much that it’s almost normalized. Homelessness shouldn’t be something that we look at as normal. Not in the “Number 1 Country in the world” or the “Best City in the world” that is unacceptable.
Jobs
7. For those out there still trying to figure out what to do for a living…. If you live in NY…. Look into Cybersecurity. In a survey of 400 companies 85% of them said they plan on hiring for cybersecurity talent in 2020. For those in the space…. Get that check!
8. Consumer sentiment (another way of saying consumer confidence) fell in late October. Most of consumer sentiment is tied to income and jobs. There are jobs…. But they aren’t really paying well and that’s starting to reflect how we fell about shopping, investing, and other actions.
9. The Federal Government is spending wayyyy too much money. The bidget gap has widened to nearly $1 TRILLION. Bruhhhhh. The deficit hasn’t been this high in 7 years. Trump ran on “spending less” but clearly he doing the opposite right now. The facts always.
10. (This is an oldie) Since the trade war started something interesting has been happening. Vietnam has been one of the largest beneficiaries of the war. How? By taking all of the supply chain roles for global companies that China used to have. Soon you’re gonna start seeing more “Made in Vietnam” instead of “Made in China”. Although the benefit has been huge, the Federal Reserve found that they just aren’t large enough of a country to take China’s place. Sometimes it’s true…. A beef can lead to chicken for others. (I hope y’all caught that lmao).
Vietnam like “That’s crazy you got beef with China… So what’s good boo?”
