“Far more money has been lost by investors trying to anticipate corrections, than lost in the corrections themselves.” — Peter Lynch
Good Morning and Happy Friday! Arm had a strong first trading day, closing 25% over its IPO price. Cocaine is set to overtake oil as Columbia’s largest export - with over $20 billion in expected exports this year.
Lazard’s new CEO wants to double the bank’s revenue by 2030. The CEO of CS Disco (a SaaS for law firms) is out - after signing a $110 million pay package last year. And Dartmouth's men's basketball team is petitioning to unionize.
According to yesterday’s poll, 65% of you read Short Squeez on your phone or tablet.
SQUEEZ OF THE DAY
MBAs vs ChatGPT
Investment banking analysts have been complaining about how useless their MBA associates are for years. But a new study at the University of Pennsylvania shows just how useless they are.
Two Wharton professors pitted their MBA students against ChatGPT to see who could come up with the best business ideas. And the chatbot ran circles around the so-called 'best and brightest' students.
The task? Come up with 100 product ideas for college students. And ChatGPT not only spit out ideas faster - but the quality of answers was better, too.
They had undergrads vote on the top 40 ideas (out of a combined 200). And ChatGPT came up with 35 of the top 40 products.
Some of ChatGPT’s top creations? Collapsible laundry hampers, dorm-room chef kits, ergonomic cushions for classroom seats – you name it.
Takeaway: To be fair to MBA associates, ChatGPT is probably smarter than most people (including the 3rd year analyst that thinks they run the bank), ChatGPT can already do some things better than very smart humans. But at this stage, it’s still just a tool - and hopefully it stays that way.
Stocks rallied on Arm’s debut, a rise in consumer spending.
(+) PENN Entertainment ($PENN) +9% after Deutsche Bank initiated a catalyst call to buy.
(–) Visa ($V) -3% after announcing a change to its share structure.
(–) Netflix ($NFLX) -3% because the CFO said the Hollywood writers’ strike is bad for business.
Databricks, an AI data analytics company, raised $500 million
Generate Biosciences, a protein-based medicines developer, raised $273 million
Pixis, a marketing platform, raised $85 million
HiddenLayer, an ML security startup, raised $50 million
SQream, a data analytics startup, raised $45 million
Kin Insurance, a homeowners insurance startup, raised $33 million
Get access to private deal flow here.
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Tesla reinvents carmaking with quiet breakthrough (Reuters)
Delta joins other airlines in cutting profit estimates on higher costs (CNBC)
Why private credit is a ray of hope for investment bankers (BB)
ECB raises rates to a record high, signals end to hikes (Reuters)
What the new Elon Musk biography gets wrong (Vox)
Investors are ignoring surging energy inflation at their own peril (YF)
Ken Griffin says he’s anxious about the market rallying (CNBC)
The cyberattack that sent Vegas back in time (CNBC)
How SBF’s parents enabled his rise (BB)
BOOK OF THE DAY
The Wealthy Gardener
Soon after he opened his vineyard for business many years ago, the Wealthy Gardener noticed a puzzling fact. Everyone wanted money, but only a few people managed to accumulate it. The reason, he realized, is that most people focus on short term gains instead of achieving lasting wealth.
As he grew old and aware of his dwindling time on this Earth, the Wealthy Gardener began to share his hard-earned wisdom with the financially troubled in his community, patiently mentoring those who asked for his practical advice on the ways of prosperity.
The parable of the Wealthy Gardener is far more than an admonishment to earn more or spend less; it is about timeless principles. As his lessons reveal, financial freedom is a means to power and control over our lives. Without money, we are subject to the demands and whims of others. With money, we are sheltered from the storm, and we can extend that shelter to our loved ones.
Poised to become an intimate financial classic, The Wealthy Gardener will inspire readers to find their own noble purpose and relieve their money worries once and for all. No matter your income level, skillset, or unique economic disadvantages, the lessons in this book will show you the path forward. All you need is the will to work, the desire to succeed, and the motivation to learn.
“A heartwarming series of stories and practical wisdom on entrepreneurship and wealth.”
Short Squeez Picks
Annual Change in US Consumer Auto Insurance Prices
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Ever found yourself knee-deep in a problem and thought, "There's got to be an easier way?" We've got your back with seven mental models that are like power-ups for your brain.
1. "The Map is Not The Territory": Ever follow a recipe to the letter and still burn dinner? That’s because life's a lot messier than its instruction manual. The takeaway? Don't blindly trust your GPS, Google, or Aunt Gertrude’s marital advice. Check things out for yourself.
2. "Do Something Syndrome": It's that compulsion to act—any action—even if it's as useful as rearranging deck chairs on the Titanic. Sometimes, the best action is inaction. Like not texting your ex at 2 am. You're welcome.
3. "First-Conclusion Bias": Your brain loves to jump to conclusions faster than a cat pounces on a laser pointer. Resist the urge to settle for the first idea and keep fishing in the pond of possibility.
4. "Social Proof": It's the "But Mom, everyone's doing it!" of adulthood. Be wary of five-star reviews and anything that's "all the rage." Remember, mullets were once popular, and we all know how that turned out.
5. "Tendency to Distort Due to Liking/Loving or Disliking/Hating": Admit it, you've ignored good advice from people you dislike and listened to nonsense from those you adore. Stop that. Seriously.
6. "Two-Front War": Multi-tasking is about as effective as a screen door on a submarine. Trying to fight battles on two fronts? You're not Napoleon. Focus on one problem at a time.
7. "The Law of Diminishing Returns": Throwing more of anything—money, time, jalapeños—at a problem doesn’t always make it better. Sometimes, less is more, and more is just...overkill.
So, go forth with these mental models in your toolkit, ready to take on life's curveballs. And remember, a well-equipped brain is the difference between "I've got this!" and "Why is this happening to me again?!"
Memes of the Day