🍋 Meme Stocks Are Back
Good Morning! The movie of the summer, "Top Gun: Maverick," just became one of the GOATs, passing "Titanic" in the all-time domestic box office rankings. Unlike Maverick's jet, consumers are expecting inflation to slow down to 6.2% next year, a big win for the Fed. Other winners include electric cars, fossil fuels, and renewables, which came out on top in the Signature Tax and Energy Bill. Tech and pharma companies might not be feeling so great after looking at the new legislation. Lucky for them, Whole Foods co-founder, John Mackey, is planning to open plant-based restaurants and wellness centers after he retires next month.
Daloopa is giving away Spotify's detailed financial model for FREE. Download here.
1. Story of the Day: Meme Stocks Are Back
Remember me(me stocks?) Just like all the worst 90's fashion trends making a comeback with Gen Z, it seems like the meme stock fad is back baby! Bed Bath & Beyond and AMC were up big yesterday, as meme stock investors piled in for... no apparent reason. Classic.
Both of the stocks are heavily shorted by other market participants, but Bed Bath & Beyond was up almost 40% (after being up 63% at one point,) and AMC almost 8%. Can't forget the OG, of course. GameStop jumped 8.6% in the frenzy.
You can likely thank the friendly folks at r/WallStreetBets, as Bed Bath & Beyond was the most searched name on its discussion board yesterday. There was even a pinned thread titled "GME, BBBY and AMC Memestock Megathread for Monday August 8, 2022." So specific it sounds like something you'd find in the New England Journal of Medicine.
Where there's smoke that resembles silliness, you know there's a fire that's pure chaos. One user posted that they "took out a 27k loan, went all in on BBBY." Another user, TheDude0007, apparently turned $45k into $450k with common stock and options plays. The casino is officially back.
Short Squeez Takeaway: Shouts out to all you YOLO traders out there for short squeezing funds with short interest, and reminding them the name that's running the game. It really is fascinating to see the power these online communities have on the markets. Please don't go too crazy though. As Melvin Capital knows too well, it can all go against you real fast.
2. Markets Rundown
Equities looked like a chopped cheese after a day spent bouncing between positive and negative territory, while crypto was up, potentially on the heels of the meme stock resurgence.
Movers & Shakers
- (+) Bed Bath & Beyond ($BBBY) +40% because meme stocks...
- (+) Signify Health ($SGFY) +11% after it was reported that CVS Health is planning a bid for the company.
- (–) Palantir ($PLTR) -14% after an EPS miss for the last quarter.
- Pfizer will buy Global Blood Therapeutics for $5.4 billion
- Apollo finalizes purchase of Atlas Air for $2.9 billion
- Montagu buys Lloyd’s List, a maritime intelligence division, for $465 million
- QinetiQ US acquires cybersecurity firm Avantus for $590 million
- Afresh Technologies, a food optimization platform, raised $115 million
- Axios sells itself to Cox Enterprises for $525 million
3. Top Reads
- Record M&A and buyout activity in renewables, storage (Axios)
- US jobs growth jumps in July despite slowdown fears (BBC)
- Consumer confidence in housing market hits decade’s lowest point (CNBC)
- Carlyle CEO Kewsong Lee resigns before term ends (Fox)
- SoftBank records $23 billion loss amidst tech downturn (Fox)
- Google outage reported across the globe (CNBC)
- Malcolm Gladwell on why returning to office is in your best interest (Fox)
- Warren Buffett has another reason to hate Robinhood (CNN)
- Hedge funds post July gain on stock market rally, still down for year (Reuters)
A Message from Daloopa: Update Models with 1-click
Here's a dirty secret: part of being a finance professional consists of being one of the world's best-paid data-entry professionals.
It's a pain—and a rite of passage—to build a financial model by painstakingly transcribing information from 10-Qs, 10-Ks, presentations, and transcripts. Or, at least, it was: Daloopa uses machine learning and human validation to automatically parse financial statements and other disclosures, creating a continuously-updated, detailed, and accurate model.
Thomas Li (CEO) puts it best: “Daloopa collects literally everything a company discloses.”
Today is your lucky day because Daloopa is giving away one of their models to Short Squeez readers -> Spotify whose stock has bounced back 15% after recent Q2 earnings.
4. Book of the Day: Conflicted: How Productive Disagreements Lead to Better Outcomes
For most people, conflict triggers a fight or flight response. Disagreeing productively is a hard skill for which neither evolution or society has equipped us. It’s a skill we urgently need to acquire; otherwise, our increasingly vociferous disagreements are destined to tear us apart. Productive disagreement is a way of thinking, perhaps the best one we have.
It makes us smarter and more creative, and it can even bring us closer together. It’s critical to the success of any shared enterprise, from a marriage, to a business, to a democracy. Isn’t it time we gave more thought to how to do it well?
In an increasingly polarized world, our only chance for coming together and moving forward is to learn from those who have mastered the art and science of disagreement. In this book, we’ll learn from experts who are highly skilled at getting the most out of highly charged encounters: interrogators, cops, divorce mediators, therapists, diplomats, psychologists.
These professionals know how to get something valuable – information, insight, ideas—from the toughest, most antagonistic conversations. They are brilliant communicators: masters at shaping the conversation beneath the conversation. They know how to turn the heat of conflict into the light of creativity, connection, and insight.
In this much-need book, Ian Leslie explores what happens to us when we argue, why disagreement makes us stressed, and why we get angry. He explains why we urgently need to transform the way we think about conflict and how having better disagreements can make us more successful.
By drawing together the lessons he learns from different experts, he proposes a series of clear principles that we can all use to make our most difficult dialogues more productive—and our increasingly acrimonious world a better place.
“A thoughtful, thought-provoking guide to getting along, even when doing so might seem impossible.”
5. Short Squeez Picks
- Hims is here to help you boost your performance in the bedroom. The entire process is 100% online. There is no need to leave your couch or have one of those awkward conversations with your doctor. Start your free visit today
- How to use your lunch break to boost productivity for the rest of the day
- Is it fair to pay people less if they want to work from home?
- A simple physical wealth playbook
- Why beach vacationers are doing it wrong
6. Daily Visual: When M&A Works
7. Daily Acumen: How Much Cash Should I Hold?
"There are two reasons to hold cash investments: to cover upcoming spending and in case we’re hit with a financial emergency.
Suppose you plan to make a house down payment in the next five years or you’re five years from making your teenager’s first college tuition payment.
You don’t want to see this money devoured by a stock or bond market decline, so you probably shouldn’t own anything more adventurous than a high-quality short-term bond fund.
Even a short-term bond fund could suffer a modest loss, so you might favor a high-yield savings account or a low-cost money market fund once you’re within 18 or 24 months of spending the money.
Meanwhile, you may need to tap your emergency fund at short notice, so you should probably stash those dollars in the same sort of investments—savings accounts, money market funds and short-term bond funds.
How much rainy-day money should you have? One rule of thumb says your emergency fund should equal three-to-six months of living expenses. That’s potentially a huge sum.
Could you hold less? The biggest financial emergency is losing your job. Ponder how long it might take you to find another job, how much you’d need to cover costs in the meantime and how much money is readily available to you.
For instance, you might hold less than the full six months of living expenses if your job is secure, if it would be easy to find a new job or if your spouse also works. You might also hold a smaller emergency reserve if you have easy access to borrowed money thanks to, say, a home equity line of credit.
Ditto if you’ve funded a Roth IRA. You can withdraw your original contributions from a Roth IRA at any time, with no income taxes or penalties owed, provided you don’t touch the account’s investment earnings.
What if you have substantial savings in your taxable account—far more than you could conceivably need for a major home repair or a long period of unemployment? You might take more risk, stashing some of your emergency money in intermediate-term bonds and perhaps even buying stock funds.
Think of it like a high deductible on an insurance policy: Yes, if financial markets slide, your taxable account would take a hit—but if you have more than enough to cover a financial emergency, you should still be in decent shape."
Source: Humble Dollar
8. Crypto Corner by Bonkalytics.com
- Crypto bear market to provide excellent M&A opportunities
- Crypto and the U.S. government are headed for a decisive showdown
- Ethereum's best known privacy tool falls under U.S. sanctions
- U.S. imposes sanctions on virtual currency mixer Tornado Cash
- Crypto lobbying in Washington surges this summer
- Singapore-based crypto lender Hodlnaut suspends withdrawals amidst market conditions
For more crypto-focused content, sign-up here.
9. Memes of the Day
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