🍋 Stonks are Back!

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Good Morning and Happy Friday! Looks like remote work could be ending soon. Elon Musk’s first email to Twitter staff banned remote work, and Pfizer announced it will enforce 2-3 days of weekly office work in January. 

Amazon is reviewing unpopular business units, including Alexa, as the company tries to cut costs. Juul secured a cash bailout and cut jobs as the company tries to avoid inflation. And the FTX news is getting even weirder - the exchange’s entire operation was reportedly run by a ‘gang of kids’ that all dated each other in the Bahamas.

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1. Story of the Day: Stonks are Back!

Yesterday was a big one for stocks. The CPI data released yesterday shows that inflation is cooling. All major indices subsequently had their best day since 2020.

Inflation rose 8.3% from September 2021 to 2022, which is near the yearly average. But October’s CPI fell to 7.7%. Excluding food and energy prices, which are highly volatile, inflation only rose 6.3% over the twelve-month span.

While yesterday’s stock market rally is encouraging, we still have a long way to go. Even after yesterday’s massive rally, the S&P 500 is still down 17.5% YTD. That said, some investors think yesterday’s news means the worst is behind us.

The Fed has hinted at pausing rate hikes in the past few weeks. But the central bank needs a reason to do so. They might have found one with the recent CPI data.

Powell previously hinted he wouldn’t necessarily need to see lower inflation readings to slow rate hikes, but yesterday’s data may provide the encouragement the Fed’s looking for.

Takeaway: The Fed is all in on fighting inflation, and the stock market won’t fully recover until Jerome finishes the job. But yesterday’s inflation data points to the economy heading in the right direction.

2. Markets Rundown

If you want access to Wall Street insider interviews, industry deep-dives, and investment ideas, check out our Insiders newsletter.

Stocks had their biggest day of the year after strong inflation data.

Movers & Shakers

• (+) Rivian ($RIVN) +17% after the EV maker reported better-than-expected losses.

• (+) Coinbase ($COIN) +11% because the company is well-positioned to become the dominant player in the crypto industry after the FTX fallout.

• (–) Vacasa ($VCSA) -45% because the vacation booking platform reported weak earnings.

Private Dealmaking

• Odergroove, a subscription management platform, raised $100 million

• Ostara, a Missouri fertilizer manufacturer, raised $70 million

• Athletic Brewings, a non-alcoholic beer manufacturer, raised $50 million

• Audoleadstar, an AI marketing platform for car dealers, raised $40 million

• Mem, an AI-powered notetaking app, raised $24 million

• Brookfield Asset Management and EIG Global Energy Partners will buy Origin Energy for $11.8 billion

Top Reads

• Homeowners have lost more than a trillion dollars in equity (Axios)

• Inflation still holding grip on economy as prices remain high (Fox)

• Fed thinks rate pauses are possible when funds rates hit 4.5% (YF)

• Meta’s foundation is crumbling (Axios)

• Takeaways from a hopeful inflation report (NYT)

• Why Twitter’s boss is more like Jack Welch than you think (BB)

• The Dow got a 400-point boost from just four stocks (MW)

• How venture capitalism became the most coveted job in Silicon Valley (Substack) 

• Rude behavior is contagious and on the rise (Axios)

• When workaholism turns from a virtue to a vice (Atlantic)

4. Book of the Day: Wolf Hustle: A Black Woman on Wall Street

Growing up, Cin Fabré didn’t know anything about the stock market. But she learned how to hustle from her immigrant parents, saving money so that one day she could escape her abusive father and poverty in the Bronx. 

Through a tip from a friend, Cin pushed her way into brokerage firm VTR Capital―an offshoot of Stratton Oakmont, the company where the Wolf of Wall Street, Jordan Belfort, had reigned. 

She was shocked to find an army of young workers, mostly Black and Brown, with no real prospects for promotion sitting at phones doing the drudge work of finding investment leads for white male brokers. 

But she felt the pull of profit and knew she would do whatever she had to do to be successful.

Pulling back the curtain on the inequities she and so many others faced, Wolf Hustle reveals how Cin worked grueling hours, ascending from cold caller to stockbroker, becoming the only Black woman to do so at her firm. 

She also discloses the excesses she took part in on 1990s Wall Street―the strip clubs, the Hamptons parties, the Gucci shopping sprees―while reveling in the thrill of making money. 

From landing clients worth hundreds of millions to gaining, losing, then gaining back fortunes in seconds, Cin examines her years spent trading frantically and hustling successfully, grappling with what it takes to build a rich life, and, ultimately, beating Wall Street at its own game.

“If you were really poor, you could notify the lunch ladies that you needed assistance and you could get the lunch for free, but most kids chose not to do that, perhaps to avoid public embarrassment.”

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The analysis sees a compounded annual growth rate of 15.7% over the 7-year forecast period.

A reformed outlook on the legalization, acceptance, and adoption of cann-a-bis for medical use greatly contributes to its potential reach.

The treatment of chronic pain garnered the largest share of medical cann-a-bis sales in 2021 and 2022.

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5. Daily Visual: Racial Diversity in US Professional Sports

Source: GZERO

6. Daily Acumen

“The price of longevity is inefficiency.

What's most efficient at the moment is rarely the most effective in the end.

Someone who maxes out their mortgage makes a lot of money when the tide is rising but gets exposed when it goes out. 

We are conditioned to compare ourselves to whoever is doing best.

That's the bar. An impossible standard that encourages us to take more and more risks.”

Source: Farnam Street

7. Crypto Corner

• Crypto in chaos as FTX teeters on verge of bankruptcy 

• SBF issues a ‘mea culpa’ and apologies over Twitter

• FTX collapse most consequential failure for crypto world

• Tether's USDT stablecoin depegs from dollar for a brief window

• FTX tapped into customer accounts to fund risky bets

• FTX has resumed withdrawls

8. Memes of the Day

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