- Short Squeez
- 🍋 Dollar Wreaking Havoc
🍋 Dollar Wreaking Havoc
Good Morning! For those looking for upcoming weekend plans already, Sydney, Australia has a $33 million plan to amp up the city's nightlife and shed its reputation as a boring city. RWE, a German energy firm, will buy Con Edison for $6.8 billion. Walmart and CVS face lawsuits blaming a common painkiller for autism. And Crocs, one of Gen-Z’s favorite shoe makers, is offering a giveaway contest this week, just in time for Timbs season to return.
As promised, please find attached Excel and PowerPoint shortcuts here.
It's sweatpants season 24/7/365, which means y'all need to have Public Rec’s All Day Every Day Pant.
1. Story of the Day: Dollar Wreaking Havoc
The US dollar, which is pushing towards its strongest level in 40 years, impacts most countries across the world.
A strong US dollar, ironically, arguably impacts other countries’ economies more than it impacts the domestic one. A strong dollar is concerning for many developing countries that hold debt in US dollars.
The strengthening of the US dollar is directly tied to the Fed’s aggressive tightening cycle to fight inflation, most noticeably marked by an increase in interest rates. As a result, the increased cost of borrowing has pushed rival currencies lower as the US dollar appreciates in value relative to others.
Given the higher cost of paying off debt, the strong US dollar especially impacts developing countries that issue debt in foreign currency. Ultimately a strong dollar additionally pressures other countries to implement their own rate hikes, concerning those fearing a global economic slowdown.
Despite the prospect of further economic trouble, the Fed remains committed to combating inflation to the tune of additional interest rates. To the Fed’s eyes, a strong dollar is preferable to inflation. It causes ‘disinflation’ when imported goods cost less in dollar terms. A silver lining for developing countries, however, is that their exporters see higher revenues when their currencies decline, leading to further growth.
Short Squeez Takeaway: The strong US dollar, despite seeming relatively harmless to American consumers, nevertheless has the potential to cause economic headaches to other economies. While it certainly impacts the global economy, economists nevertheless debate whether a strong dollar is ‘good’ or ‘bad’ for other countries; it certainly isn’t a black-and-white issue.
2. Markets Rundown
Stocks ended a rough month of September with all major indexes closing lower on Friday.
Movers & Shakers
(-) Carnival Cruise ($CCL) -23% amidst high fuel prices and inflation.
(-) Nike ($NKE) -13% after the company reported overstocked inventory.
(+) Generac ($GNRC) +2% after the energy provider was upgraded by analysts.
Traveloka, an Indonesian online travel agent, raises $300 million
GrubMarket, an organic foods B2B market, raised $120 million
Moxion Power, a clean energy manufacturer, raised $100 million
Pigment, a business planning platform, raised $65 million
Workstream, an employee hiring and onboarding platform, raised $60 million
Arthur.ai, a machine learning platform, raised $42 million
3. Top Reads
The powerful people texting Elon Musk before he offered to buy Twitter (Axios)
The next big battle between Google and Apple is for the soul of your car (WSJ)
What has Wall Street on edge as risks rise around the world (CNBC)
History shows the stock market will always eventually roar back (YF)
Dow ends tumultuous September down nearly 9% (CNBC)
Facebook scrambles to avoid stock’s death spiral as users flee, sales drop (CNBC)
Apple downgrade sparked tech sell-off, sending Microsoft and Alphabet to one-year lows (CNBC)
What all the stealing says about America (YF)
Tesla robot slowly walks on stage for AI day (CNN)
Shaq down to team up with Jeff Bezos to buy Phoenix Suns (Fox)
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4. Book of the Day: How The Mighty Fall
Amidst the desolate landscape of fallen great companies, Jim Collins began to wonder: How do the mighty fall? Can decline be detected early and avoided? How far can a company fall before the path toward doom becomes inevitable and unshakable? How can companies reverse course?
In How the Mighty Fall, Collins confronts these questions, offering leaders the well-founded hope that they can learn how to stave off decline and, if they find themselves falling, reverse their course.
Great companies can stumble, badly, and recover.
Every institution, no matter how great, is vulnerable to decline. There is no law of nature that the most powerful will inevitably remain at the top. Anyone can fall and most eventually do. But, as Collins' research emphasizes, some companies do indeed recover-in some cases, coming back even stronger-even after having crashed.
Decline, it turns out, is largely self-inflicted, and the path to recovery lies largely within our own hands. We are not imprisoned by our circumstances, our history, or even our staggering defeats along the way. As long as we never get entirely knocked out of the game, hope always remains. The mighty can fall, but they can often rise again.
“Bad decisions made with good intentions, are still bad decisions.”
5. Short Squeez Picks
6. Daily Visual: Price Changes: Jan 2000 to June 2022
Selected US Consumer Goods and Services, Wages
Source: Bureau of Labor Statistics; Carpe Diem AEI
7. Daily Acumen: Choose Your Company Wisely
"If everyone around you complains, odds are you’re a complainer.
If everyone around you feels helpless, odds are you’re helpless.
If everyone around you is pursuing big dreams, odds are you are pursuing big dreams.
Choose your company wisely."
Source: Patrick Bet-David
8. Crypto Corner
A legendary Google billionaire is backing a Bitcoin and Ethereum rival
Ethereum’s founder on what crypto can - and can’t - do
Why the next few weeks are critical for crypto and the stock market
Why Crypto CEOs are leaving their jobs
Maple Finance aims to be the Shopify of crypto lending
How impending US regulation impacts crypto’s future
9. Memes of the Day
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