Hey there weekday warriors,
Let’s meet the most powerful man in America, shall we?
Enjoy the next 4 minutes and 29 seconds of blue-chip news and commentary.
Keep on snapping necks and cashing checks,
+ US stocks “closed firmly lower on Tuesday after Iran fired over 100 ballistic missiles at Israel, pushing oil prices for West Texas Intermediate and Brent to their biggest increases in nearly a year.” (Yahoo! Finance)
+ The 10-year Treasury yield “fell on Tuesday as investors sought safety amid rising tensions in the Middle East.” (CNBC)
+ Oil “jumped Tuesday, after Iran launched missiles against Israel triggering fresh concerns about disruptions to oil supplies in the oil-rich Middle East region.” (Reuters)
+ Bitcoin “tumbled during the Tuesday U.S. session as headlines of escalating tension in the Middle East prompted investors to flee risk assets.” (Coindesk)
+ The three most talked about stocks on WallStreetBets in the past 24 hours were: 1) Visa +1.0% 2) Nvidia -3.6% 3) Nike +0.8% // -5.9% after hours
The market moves you need to know about…
+ "I can do it myself, a**hole." Just a few weeks after 23andMe CEO Anne Wojcicki said she was open to accepting bids on the struggling genetics testing company, she has done an about-face. Shares rose 6.1% (to 37 cents!) on news that Anne plans to move forward with acquiring the company herself.
– Disney just put all its ad partners in a body bag. At a conference, the House of Mouse confirmed it is well on its way to automating ~75% of its ad biz by the year of our lord 2027. One of its biggest ad tech partners, Magnite, tumbled 10.7% on the day.
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All Hal breaks loose
What does a port strike mean for the US economy?
Harold Dagget, the chief negotiator for the International Longshoremen Association explains:
"I will cripple you, and you have no idea what that means. I do. Let me explain…”
— #John LeFevre (#@JohnLeFevre)
1:26 PM • Oct 1, 2024
You guys, we did it. We found the final boss of union leaders.
Harold Dagget checks all the boxes. He’s got the name, the look, and the pedigree. The president of the International Longshoremen’s Association rocks a chain straight out of Goodfellas… which makes sense given his (alleged) mafia ties.
And right now, a guy named Harold who looked his barber in the eyes and said “give me the Dave Ramsey,” holds the fate of the US economy in his hands. Sorry, J-Poww.
As president of the union that represents dockworkers at 36 ports on the eastern seaboard, he has orchestrated a strike that threatens to cripple the US. At 12:01 Tuesday, more than 45k longshoremen (think: guys like Tommy, who used to work on the docks) walked off the job after their contracts expired.
What’s got them so butt hurt?
Pay, obviously. Oh, and automation.
Management has already offered ILA workers a 50% pay increase over the next 6 years, to which the union replied, "hard pass."
But it isn't just straight cash homie that the two sides will have to navigate. The longshoremen are demanding assurances that they won't be replaced by robots.
The fallout
If a contract is inked in the next few days, the collateral damage could be fairly limited. Most retailers stocked up on goods with the threat of the strike looming. Plus, some shipments could find their way to the West Coast or Canada.
But if the strike drags on, sh*t could hit the fan. JPMorgan estimates each day the strike lasts will cost the US economy upwards of $4.5B. And according to experts (whose favorite song is presumably ‘The Wreck of the Edmund Fitzgerald’) for every day that ports are closed, it takes 1 week to get them up and running.
This raises some major concerns about inflation and that soft landing J-Poww is trying to choreograph (… which will only be harder to deal with given the booze and banana shortages).
+ "Look what you did, you little jerk." - me to Iran’s “Supreme” Leader Ali Khamenei after checking my Robinhood account yesterday
The threat of WW3 had investors going all "ight imma head out" yesterday. The three major indices took their lumps after Iran attacked Israel (again), sparking fears of a widespread conflict in the region.
So, where'd all the money go?
To safe havens, of course. Like gold and bonds. Oil and defense contractor stocks also climbed on fears that the Middle East would devolve into chaos.
+ “You’ll get nothing and like it.” - Nike
Incoming Nike (+0.8% // -5.9% after hours) CEO Elliott Hill is playing chess while all of you are playing checkers. You see, you can’t underdeliver if you don’t overpromise. During its earnings call, Nike withdrew its annual guidance and canceled its upcoming investor day.
To make matters worse, the Swoosh reported another quarter of pretty piss-poor results. NKE missed (already low) top line expectations but managed to eke out a beat on the bottom line.
It also said it expects sales to fall between 8% and 10% in the current quarter, which is worse than what the Street was looking for (-6.9%).
But, hey, on the bright side, it can blame the port strike for revenue headwinds this quarter…
+ Frito-Lay (aka Pepsi) (+0.7%) is cornering the market on tortilla chips, you guys *the FTC has entered the chat*.
The owner of Tostitos and Doritos is adding Siete Foods to its portfolio for $1.2B. The brand is most well known for its grain-free tortilla chips, but also slings taco shells (so, big tortilla chips), salsa, and Mexican seasonings.
+ After 16 years at the helm, Charles Schwab (-1.3%) CEO Walt Bettinger said he plans to step down at the end of 2024. President Rick Wurster will take the reins… and has some big deal sleds to fill. You see, Walt is kind of a big deal. He oversaw the acquisition of TD Ameritrade. And during his tenure, assets grew from $1.1T to $9.7T. No pressure, Rick…
+ Tom Brady to put his watch collection up for sale at Sotheby’s. Yet another athlete forced to sell off his prized possessions after losing all his money. Sad!
🔥 Here’s how much the ‘American dream’ costs. Anddd it appears that I will never live the American dream.
FYI, TWC might be compensated if you click on the links above. So, what are you waiting for? Start clicking.
⏪ Yesterday, Nike reported after the bell and the International Longshoremen's Association union went on strike at dozens of ports in the US
⏩ Today we’re keeping an eye on…
+ Tilray reports before the open
+ Levi Strauss drops earnings after hours
+ WW3 might start…
Yesterday, I asked, “You get $10k per month but one day (a full 24 hour period) per week you only get to sleep for 1 hour max. If you stick to it for less than 6 months you have to give all the money back. You in?”
75.8% of you want in, and I think you wildly underestimate how sh*tty one hour of sleep is...
Here’s what some of you guys had to say (and my thoughts in italics)…
No: "$10k per month? That's about what people on food stamps get. Pass." Lol.
Yes: "Sounds similar to having a newborn, and I did that shit for free last time.”
Yes: "Pulling an all-nighter once a week sounds pretty brutal on the wrong side of 30. With that being said, could coordinate sleepless period primarily around weekends, utilize wfh as needed to offset sleep deprivation during the week, and generally be productive during those waking hours and plan to sleep more the other nights. Going from 5-6 hours of sleep to 7-8 hours per night to offset the night on 1 hour more than covers the lost sleep time (no science behind that). For $10k a month? I'm a shameless, dirty-little-you-know-what for money and trying to pay my house off EARLY." I think the word you are looking for is prostitute.
Yes: "I’m an intensive care doctor. That’s basically how my life already works." TYFYS. I miss when we used to bang pots and pans for you guys…
Yes: "Sorry I'm still thinking about the phrase "big, thick, throbbing rate cut"
No: "Lost me at no drugs"
And here’s today’s questions…
Big tortilla chip becoming bigger got me thinking…
What's the GOAT tortilla chip?
Oh, and one more thing…
What did you think about today's newsletter?
Does this look like the face of a guy you should take financial advice from?
No, it’s the face of an individual who is financially irresponsible/dumb enough to be talked into spending money on a family photo shoot that he could have just done with his iPhone. So, act accordingly...
This is not financial advice. Nothing in this newsletter is an investment recommendation. All content is created for entertainment, educational, or informational purposes only. Do your own research, or do yourself a favor and hire a professional.