Good morning. Happy Friday.
The Asian/Pacific markets did well. Japan, Hong Kong, Taiwan and Singapore lead with gains nearly of 1% or better. Europe, Africa and the Middle East are currently doing well too, but there are no standout winners – just moderate gains from many countries. Futures in the States point towards a moderate gap up open for the cash market.
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My interview with WorldClassPerformer.com
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The dollar is down slightly. Oil and copper are up. Gold and silver are down. Bonds are down. Bitcoin is down.
Stories/News from Seeking Alpha…
Delta Force
The business community in the U.S. is still sizing up the new vaccine mandate unveiled by the Biden administration on Thursday night. The expansive rules will demand that private employers with more than 100 workers require their staff to be vaccinated or test weekly for COVID-19 (affecting about 80M Americans). Government and health care workers (another 17M people) will also be required to get vaccinated – with no option to opt for regular testing – as a rise in Delta cases triggers fresh concerns about the pandemic. The legal basis for the order hangs on the Occupational Safety and Health Administration (OSHA), which has the authority to enforce regulations affecting workers’ well-being (expect many legal challenges).
Quote: “President Biden’s announcement prompts critical questions that require immediate clarification,” said the Consumer Brands Association, which represents makers of packaged goods. “As with other mandates, the devil is in the details. Without additional clarification for the business community, employee anxieties and questions will multiply.”
While OSHA is still developing the emergency regulation, some officials say employers could face fines of nearly $14,000 per violation. The mandate also follows more than a year of upheaval, which started as months of lockdowns and new costs for hand sanitizer, face masks and plexiglass barriers. Many businesses are still struggling under safety protocols, and additional compliance costs and verification for the new mandate could hand them a new set of potentially complex requirements.
Go deeper: Following the announcement, companies like General Motors (NYSE:GM) and Delta Air Lines (NYSE:DAL) issued statements describing the efforts they’ve made to get their employees vaccinated, but didn’t announce whether they endorsed Biden’s plan. Others, such as Walgreens Boots Alliance (NASDAQ:WBA) and Intel (NASDAQ:INTC), said they were studying it. While many in Corporate America have already required vaccines, including Facebook (NASDAQ:FB), Netflix (NASDAQ:NFLX), Disney (NYSE:DIS), McDonald’s (NYSE:MCD) and Tyson Foods (NYSE:TSN), the new mandate also affects small or mid-sized companies that are already dealing with labor shortages. “It wouldn’t surprise me if others look for an employer who doesn’t have 100 employees – and that’s a huge issue for me, especially in this competitive job market,” said Jay Baker, president of Jamestown Plastics in Brocton, New York.
Crypto caution
The Bitcoin (BTC-USD) warnings are coming from far and wide following a big week that saw El Salvador legalize the crypto as legal tender. Bitcoin -0.5% to $46,087.
Riksbank Governor Stefan Ingves: “Private money usually collapses sooner or later. And sure, you can get rich by trading in Bitcoin, but it’s comparable to trading in stamps,” he warned at a banking conference in Stockholm. Earlier this year, Ingves said that cryptos as a whole are unlikely to escape regulatory oversight as their popularity grows. “When something becomes large enough, factors such as consumer interests and money laundering enter the picture.”
Banxico Governor Alejandro Diaz de Leon: “Whoever receives Bitcoin in exchange for a good or service, we believe that [transaction] is more akin to bartering because that person is exchanging a good for a good, but not really money for a good. In our times, money has evolved to be fiat money issued by central banks. People will not want their purchasing power, their salary to go up or down 10% from one day to another. You don’t want that volatility for purchasing power. In that sense, it is not a good safeguard of value.”
Regulation coming? Don’t forget the warnings from SEC Chair Gary Gensler earlier this month, who called crypto the “Wild West.” It’s “rife with fraud, scams, and abuse in certain applications. If we don’t address these issues, I worry a lot of people will be hurt.” What exactly the SEC ends up doing is yet to be determined, but the agency did go after Coinbase (NASDAQ:COIN) this week over a product called Lend, which would let users earn interest by lending digital assets. The SEC said the program securitizes crypto via interest passed on to the customer, though the Wells notice caused an uproar in the DeFi community and prompted some charged tweets from Coinbase CEO Brian Armstrong.
Smart shades
Facebook (FB) and Ray-Ban (OTCPK:ESLOF) have finally unveiled Wayfarer Stories – their stab at using an iconic sunglasses line to make smart spectacles more cool and palatable than past attempts. The new eyewear can snap photos and record videos, answer phone calls, and play music and podcasts. It also represents the latest effort by Facebook to erase boundaries between people’s virtual and real lives as the company dips further into the Metaverse.
Some nostalgia: The move is the latest attempt to bring smart eyewear to the masses after notable attempts from Google Glass (GOOGL) and Snap Spectacles (SNAP).
Facebook teased the big event with Ray-Ban yesterday with links to action-sports videos from Mark Zuckerberg and Andrew Bosworth, head of Facebook Reality Labs. The Wayfarer Stories start at $299, come in 20 styles, and sport a tiny front-facing light that lets others know when the camera is recording (privacy concerns?).
Bosworth tells the NYT: “We asked ourselves, how do we build a product that helps people actually be in the moment they’re in? Isn’t that better than having to take out your phone and hold it in front of your face every time you want to capture a moment?” He also scoffs somewhat at comparisons with Google and Snap’s products, noting they’re focused more on the frames’ fashion than the tech inside: “This product has not been tried before because we’ve never had a design like this before.”
Tax evasion
The top 1% of Americans ranked by income fail to pay as much as $163B in owed taxes per year, according to Natasha Sarin, deputy assistant secretary for economic policy at the U.S. Treasury. The study drives a point home that has surfaced several times this year. Just last week, executives at hedge fund Renaissance Technologies agreed to pay approximately $7B in back taxes and penalties in one of the largest settlements with the IRS, while ProPublica leaked some of the ways the wealthiest Americans avoid taxes back in June.
‘We are the 99%’: “Today’s tax code contains two sets of rules: one for regular wage and salary workers who report virtually all the income they earn; and another for wealthy taxpayers, who are often able to avoid a large share of the taxes they owe,” continues Sarin. “Today, the ‘tax gap’ – the difference between taxes that are owed and collected – totals around $600B annually and will mean approximately $7T of lost tax revenue over the next decade. The sheer magnitude of lost revenue is striking: it is equal to 3% of GDP, or all the income taxes paid by the lowest earning 90% of taxpayers.”
Tax numbers are in the spotlight as the White House proposes investing $80B into the IRS over the next 10 years. The funds would be earmarked for more enforcement staff and would overhaul technology systems. The Biden administration is also calling for “using information that financial institutions already possess, so the IRS can deploy these additional resources to audit more sophisticated tax evaders.”
Outlook: Democrats hope that collecting more unpaid taxes will help fund a $3.5T spending package they are in the process of drafting by bringing in $700B over 10 years. Others say not so fast. The bipartisan Congressional Budget Office estimates new revenue from the proposal would total around $200B over the decade, while many Republicans are hesitant about granting more power or privacy rights to the IRS.
Today’s Economic Calendar
8:30 Producer Price Index
9:00 Fed’s Mester: “New Avenues for Monetary Policy”
10:00 Wholesale Inventories (Preliminary)
1:00 PM Baker-Hughes Rig Count
Companies reporting earnings today »
What else is happening…
FDA postpones decision if Juul (NYSE:MO) can stay on the market.
Labor shortage: Amazon (NASDAQ:AMZN) offers free college tuition to lure workers.
ECB preps for reducing asset purchases under emergency program.
Fed presidents to sell all stocks amid pressure over trading activity.
DoorDash (NYSE:DASH), Uber Eats (NYSE:UBER) sue NYC over commission caps.
Years of losses… Ford (NYSE:F) plans to stop manufacturing in India.
Tesla’s (NASDAQ:TSLA) Elon Musk warns of challenging Q3 production numbers.
Bumble (NASDAQ:BMBL) prices 18M-share secondary offering at $54.
COVID surge… Microsoft (NASDAQ:MSFT) return to U.S. offices delayed indefinitely.
Apple (NASDAQ:AAPL) reportedly names new head of self-driving car efforts.
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Good morning. Happy Thursday.
The Asian/Pacific markets were mostly weak. China and Indonesia did well, but Japan, Hong Kong, South Korea, New Zealand, Australia, Malaysia and Thailand did poorly. Europe, Africa and the Middle East currently lean down. Turkey is up, but the UK, Greece, South Africa, Norway, Hungary and Spain are weak. Futures in the States point towards a down open for the cash market.
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Masterclass Overview –>> here
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The dollar is down. Oil is down; copper is up. Gold and silver are up. Bonds are flat. Bitcoin is down.
Stories/News from Seeking Alpha…
Up in smoke?
September 9, 2021, may go down as a day of reckoning for the vaping industry, with the FDA set to decide whether and how e-cigarette companies may keep selling their products in the U.S. The biggest impacts could be felt by Vuse, which is owned by Reynolds American (NYSE:BTI), and Juul, in which Altria (NYSE:MO) has a 35% stake. Some other companies like Philip Morris (NYSE:PM), Swedish Match (OTCPK:SWMAF) and Imperial Brands (OTCQX:IMBBY) could also see a significant competitive advantage if their product is approved, or could get hit if rejected.
Backdrop: Last September, all U.S. e-cigarette manufacturers were required to take their vaping products off the market or submit them for FDA review. Scientific evidence was required to demonstrate that each product was less harmful than traditional cigarettes and that cigarette smokers would be more likely to stop smoking if they used it. Since then, more than 500 companies have filed applications for some 6.5M products, while the FDA enacted temporary restrictions on some sweet and fruity products to curb youth vaping.
Today’s decision will likely come down to whether e-cigarettes have a net positive or negative effect on American public health. Is there enough data that supports the potential good of adult cigarette smokers switching to a less harmful option? Can a case be made that vaping is more detrimental than smoking due to young people getting hooked on nicotine? Stricter controls may also be implemented on the way e-cigarettes are marketed and sold, while manufacturers might have to submit future marketing campaigns to the FDA.
Outlook: While the agency won’t be able to render decisions on every single product by today’s deadline, it is fast-tracking those with the largest market share. The FDA has already blocked the sale of 55,000 flavored vape products from three companies that did not meet its standards and more crackdowns may be on the way. In April, the FDA announced plans for a proposal that would ban menthol cigarettes and flavored cigars, and is also reportedly considering whether to seek limits on nicotine levels in cigarettes to reduce their addictive potential.
Investors grow cautious
Another day of losses may be in store for the U.S. stock market, with futures contracts tied to the Dow, S&P 500 and Nasdaq falling another 0.3% overnight. The major averages have slid over the last three consecutive trading days as investors question valuations amid worries about Fed tapering and the Delta variant. Recovery optimism was also thrown a curveball last Friday, with a jobs report that showed a sharp slowdown in the pace of hiring in the U.S.
Strange anomaly: 8.4M Americans are still unemployed across the country despite fresh figures yesterday that showed 10.9M job openings for July (the most on record dating back to 2000). Companies are even raising pay and bonuses to people who accept job offers or recruit their friends, but that doesn’t seem to be helping. While many businesses have blamed enhanced unemployment benefits, economists at J.P. Morgan have found “zero correlation,” at least so far, between job growth and state decisions to drop federal unemployment aid.
Whatever the case may be, a delay in the return of millions to the workforce could weigh on GDP and the recovery. In fact, overall growth has already “downshifted slightly to a moderate pace,” according to the latest Beige Book, which was published on Wednesday. Investors this morning will also be watching the latest weekly jobless claims report, a metric that’s seen as a proxy for layoffs, for a better look at the employment picture.
Lingering concerns: The potential tapering of central bank stimulus is not limited to the U.S. The ECB today determines whether the recovery is strong enough to warrant a pullback in monetary stimulus despite supply chain bottlenecks and the rapidly spreading Delta variant. “The real unknown is if the ECB will revise its inflation and growth forecast,” said Agnes Belaisch, strategist at the Barings Investment Institute. “If it raises its inflation forecast closer to 2%, that will make markets wonder if it could overshoot and if the ECB could have to raise interest rates.”
All in on solar
Solar is going to play a massive role in decarbonizing the American power grid, according to a newly released plan by the U.S. Department of Energy. The Solar Futures Study shows that by 2035, solar energy has the “potential to power 40% of the nation’s electricity,” before ultimately hitting 45% by 2050. Further modeling indicates that the remainder of a carbon-free grid would be supplied by wind (36%), nuclear (11%-13%), hydroelectric (5%-6%) and biopower/geothermal (1%).
How to get there? The U.S. already installed a record amount of solar in 2020 – 15 gigawatts – to total 76 GW, representing 3% of the current electricity supply. In order to accomplish the above-stated goals, the country would need to install an average of 30 GW of solar capacity per year between now and 2025 and 60 GW per year from 2025-2030. Storage will also enable more flexibility and resilience, while advanced tools like grid-forming inverters, forecasting, and microgrids would play a role in maintaining the reliability and performance of a renewable-dominant grid.
“This is code red. The nation and the world are in peril,” President Biden said on Tuesday while visiting areas slammed by Hurricane Ida. “Climate change poses an existential threat to our lives, to our economy. And the threat is here. It’s not going to get any better.”
Go deeper: The bipartisan Infrastructure Investment and Jobs Act passed by the Senate in August includes billions of dollars for clean energy projects. While several big policies were left out, like extending tax credits, those initiatives could still be included in the $3.5T budget resolution approved by the House. The latest study from the DOE also estimates that the transition to a solar-driven grid could “employ as many as 1.5M people in the process – without raising electricity prices.”
Debt limit stalemate
Treasury Secretary Janet Yellen is urging Congress to raise the government’s borrowing limit, noting that lawmakers in recent years have addressed the subject with broad bipartisan support. She already made a statement on the debt limit on Aug. 9 and sent a letter to Congress about the issue in July, but is now stressing a state of urgency. Yellen estimates the Treasury’s coffers could run out of cash in October and the administration is worried about a possible debt default.
Quote: “We have learned from past debt limit impasses that waiting until the last minute to suspend or increase the debt limit can cause serious harm to business and consumer confidence, raise short-term borrowing costs for taxpayers, and negatively impact the credit rating of the United States. A delay that calls into question the federal government’s ability to meet all its obligations would likely cause irreparable damage to the U.S. economy and global financial markets.”
Since Aug. 1, when the debt limit was reinstated, the Treasury started using certain extraordinary measures to finance the government on a temporary basis. Such measures include suspending certain investments in the Civil Service Retirement and Disability Fund, the Postal Service Retiree Health Benefits Fund, and the Government Securities Investment Fund of the Federal Employees’ Retirement System Thrift Savings Plan.
Stalemate: House Speaker Nancy Pelosi has said raising the $28.5T debt ceiling won’t be included in the $3.5T reconciliation measure that House Democrats hope to pass this fall. Senior congressional Republicans have also pledged not to vote for an increase of the limit, instead urging Democrats to pass it via reconciliation. The political wrangling and failure to increase the limit could prompt a government shutdown, which has occurred three times over the past decade.
Today’s Economic Calendar
8:30 Initial Jobless Claims
10:00 Quarterly Services Report
10:30 EIA Natural Gas Inventory
11:00 EIA Petroleum Inventories
11:05 Fed’s Evans: “Exploring Career Pathways in Economic and Related Fields”
11:05 Fed’s Daly: “The Economic Gains From Equity”
12:00 Fed’s Kaplan: “Next Phase: The Economic Outlook”
1:00 PM Results of $24B, 30-Year Note Auction
1:00 PM Fed’s Bowman: “Community Bank Access to Innovation”
2:00 PM Fed’s Williams: “Racism and the Economy: Focus on Health”
4:00 PM Fed’s Rosengren, Fed’s Kashkari and Fed’s Kaplan participates in President Panel
4:25 PM Fed’s Rosengren: “Racism and the Economy: Focus on Health”
4:30 PM Fed Balance Sheet
Companies reporting earnings today »
What else is happening…
Lululemon (LULU) jumps after earnings beat, guides above consensus.
China gaming stocks hit again on report government will halt approvals.
AMC (NYSE:AMC) teases possible partnership with GameStop (NYSE:GME).
Conflict of interest? Fed’s Kaplan traded millions of dollars in stocks in 2020.
CNBC’s Jim Cramer is said to be leaving TheStreet.com.
Energy trading team at Tesla (NASDAQ:TSLA) is in the works.
Are Ray Dalio and BlackRock ‘crazy’ for investing in China?
Amazon (NASDAQ:AMZN) brings cashierless checkout technology to Whole Foods.
Big reveal: Smartglasses from Facebook (FB), Ray-Ban (OTCPK:ESLOF) coming today.
Notable NIO (NYSE:NIO) robotaxi win over Tesla (TSLA) draws notice.
AMD (NASDAQ:AMD) said to ease Chinese concerns over $35B Xilinx (XLNX) deal.
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Good morning. Happy Wednesday.
The Asian/Pacific markets leaned to the downside. Japan, Malaysia and the Philippines did well while South Korea, New Zealand, Taiwan, Indonesia and Singapore did poorly. Europe, Africa and the Middle East are currently down big. the UK, Denmark, Poland, Finland, Taiwan, Germany, Greece, South Africa, France, Switzerland, Hungary, the Netherlands, Italy and Sweden are down the most. Futures in the States point towards a down open for the cash market.
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Masterclass Overview –>> here
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The dollar is up. Oil is up; copper is down. Gold and silver are flat. Bonds are up. Bitcoin is down.
Stories/News from Seeking Alpha…
Crypto crumble
Cryptocurrencies and related stocks are facing less volatility this morning following Tuesday’s plunge, which came as Bitcoin became legal tender in El Salvador.
El Salvador’s rollout was not without its glitches, with the country’s digital wallet having to come offline for fixes. But social media also highlighted positive stories, such as one user tweeting about successfully paying for breakfast at McDonald’s with Bitcoin. El Salvador President Nayib Bukele also took to Twitter to provide updates on the rollout and the country’s holdings, noting that it was buying the dip. The country now holds 550 Bitcoins, according to the latest update.
Bukele also took a swipe at the IMF, which has said it has economic and legal concerns with the move to make the crypto legal tender, which could complicate negotiations for a much-needed $1B assistance package. “Thanks for the dip @IMFNews. We saved a million in printed paper,” he tweeted, with many on the platform then speculating that the IMF had tried to push the price of Bitcoin (BTC-USD) lower, although without specific evidence.
Bitcoin is trading around $45K, having fallen as much as 17% to below $43K yesterday. Ethereum (ETH-USD) is trading around $3,300 after falling below $3,000 yesterday, while Dogecoin (DOGE-USD) is at 24 cents, having held above 21 cents during the selloff.
Bitcoin mining stocks such as Riot Blockchain (NASDAQ:RIOT), Bit Digital (NASDAQ:BTBT) and Marathon Digital (NASDAQ:MARA) are up slightly in premarket trading. Coinbase (NASDAQ:COIN) is also higher, while Grayscale Bitcoin Trust (OTC:GBTC) is flat.
Air leaving the balloon: Yesterday, the talk was about a coordinated effort by retail investors to buy into Bitcoin in the afternoon, highlighted on the Bitcoin subreddit. While it is unclear how many went through with the plan, it fizzled as the price kept sliding. Instead, cryptocurrency watchers speculated that much of the buying interest, both retail and institutional, came leading into Tuesday and then a classic sell-the-news move was triggered.
“When this move was first announced, it didn’t have nearly as big of an impact on price as some may have expected it might, possibly because El Salvador’s population is less than New York City’s, but also because the announcement was light on details and people were on the fence about how this was going to be implemented,” Leah Wald, CEO of Valkyrie Investments, told CNBC.
“Social media platforms were very cautious over the weekend that a plunge could occur following El Salvador’s big day,” Edward Moya, OANDA senior market analyst, wrote in a note. But while the Bitcoin subreddit had plenty of accusations of market manipulation, there were also optimistic posts about McDonald’s (MCD) and other big companies moving to accept the crypto.
“There’s been a giant realization that crypto is not just Bitcoin being bought as a hedge against bad monetary and fiscal policy. More importantly, it’s the web 3.0,” billionaire Mike Novogratz said on Bloomberg. “No investor wants to miss the next internet. I think we just got too excited and this was a little air being popped out of the balloon.”
NIO offering
NIO (NYSE:NIO) says it filed to sell up to $2B worth of ADSs through an at-the-market equity offering program.
The electric vehicle company entered into an equity distribution agreement with the sales agents relating to the at-the-market offering. Sales of the ADSs under the at-the-market offering will be made from time to time or not at all, at NIO’s discretion. Sales may be made at market prices prevailing at the time of sale or at negotiated prices.
NIO plans to use the proceeds from the at-the-market offering to further strengthen its balance sheet, as well as for general corporate purposes.
Intel takes on TSMC
Intel (NASDAQ:INTC) plans to invest up to $95B to build semiconductor production facilities in Europe, another step in the company’s plan to become a global foundry player amid the chip shortage.
Intel plans for two chip factories at a new European site and could expand it further up to an 80-billion-euro investment over about a decade, according to comments from Chief Executive Pat Gelsinger at an auto industry event.
The company will commit chip manufacturing capacity at an Ireland factory to automotive chips, which use an older process technology than consumer electronics.
Facebook Glasses
Facebook (NASDAQ:FB) and Ray-Ban (OTCPK:ESLOF) have a teaser up that appears to promote their planned smart glasses with an event coming Thursday.
The release of new glasses was set up by Facebook chief Mark Zuckerberg in the company’s July earnings call: “Looking ahead here, the next product release will be the launch of our first smart glasses from Ray-Ban in partnership with EssilorLuxottica. The glasses have their iconic form factor, and they let you do some pretty neat things.” The glasses would be “progress on the journey toward full augmented reality glasses in the future,” he said then.
Cinema comeback?
Cinema stocks rallied yesterday, led by AMC (NYSE:AMC), after the latest Marvel (NYSE:DIS) superhero film shook up a traditionally slow weekend at theaters. “Shang-Chi and the Legend of the Ten Rings” broke Labor Day records, drawing $75.5M over three days and $90M domestically for the four-day holiday period.
The film had been tabbed with high expectations for a $45M-$50M opening, but Thursday previews pointed to enthusiasm for more. The $75.5M three-day total is second only to fellow Marvel film “Black Widow” ($80M) in the pandemic era, passing “F9’s” $70M and “A Quiet Place Part II’s” $48M.
New Netflix record
Saying that it expects Netflix (NASDAQ:NFLX) to see big gains in international markets over the coming years, Atlantic Equities analyst Hamilton Faber raised his price target on the company’s stock to $780 a share. Faber’s move makes his target price the highest among Wall Street analysts who cover Netflix and represents an almost 29% increase over the $606 level where Netflix traded on Monday.
Among Faber’s reasons for taking such a positive view of Netflix is what he sees as the potential for more growth in several countries through the decade. Faber said that he expects the company to reach 292 million subscribers worldwide in 2024, and 311 million subscribers in 2025, with Japan adding 14 million subscribers, India adding 12 million subscribers, and Latin America not including Brazil to increase by at least 11 million subscribers over that period.
Today’s Economic Calendar
7:00 MBA Mortgage Applications
8:55 Redbook Chain Store Sales
10:00 Job Openings and Labor Turnover Survey
1:00 PM Results of $38B, 10-Year Note Auction
1:10 PM Fed’s Williams: Economic Outlook and Monetary Policy
2:00 PM Fed’s Beige Book
3:00 PM Consumer Credit
6:00 PM Fed’s Kaplan: Economic and Monetary Policy
Companies reporting earnings today »
What else is happening…
Microsoft (NASDAQ:MSFT) scoops up video-editing software start-up Clipchamp.
Sanofi (NASDAQ:SNY) strengthens transplant business with acquisition of Kadmon (NASDAQ:KDMN) for $1.9B.
Biden $65B pandemic preparedness initiative could benefit multiple health care industries.
Virgin Galactic (NYSE:SPCE) draws another cautious look from ARK Invest after apparent mishap.
Boston Beer (NYSE:SAM) carves out more market share even as hard seltzer demand shrinks.
Coupang (NYSE:CPNG) jumps to two-week high as sentiment turns positive.
Clover Health (NASDAQ:CLOV) nears a two-month high as Reddit chatter grows louder.
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Good morning. Happy Tuesday.
The Asian/Pacific markets leaned to the upside. Japan, China and Hong Kong posted solid gains; South Korea, Taiwan and Thailand posted moderate losses. Europe, Africa and the Middle East currently lean down, but movement is minimal. The UAE, South Africa and Hungary are up; Poland, Norway, Italy, Portugal and Sweden are down. Futures in the States point towards a flat open for the cash market.
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Masterclass Overview –>> here
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The dollar is up. Oil and copper are down. Gold and silver are down. Bonds are down. Bitcoin is down (relative to Friday’s close).
Stories/News from Seeking Alpha…
Reddit targets Bitcoin
The Bitcoin (BTC-USD) subreddit community is looking at a coordinated plan to buy the cryptocurrency to commemorate El Salvador’s law making it legal tender. President Nayib Bukele tweeted yesterday that the country had purchased a total of 400 Bitcoins.
It was three months ago (and with the price at $35K) that Bukele made a surprise appearance at Miami’s Bitcoin 2020 conference to announce plans to make the crypto legal tender in his country.
The law in El Salvador goes into effect at 3 PM local time (5 PM ET) and citizens will be able to download a digital wallet and receive $30 in Bitcoin after entering their ID number. Bitcoin is now down about 1%, moving below $52K.
According to tweets, a large Brazilian Reddit (REDDIT) community with more than 3M users, plans is being called on to buy $30 each in Bitcoin. Reddit coordinating. In a post titled “So … We all buying $30 worth of Bitcoin on Tuesday,’ user thadisusb writes: “3,316,862 Community Members X $30/each = $99,505,860 (give or take based on currencies used) … El Salvador will have the crypto launch @ 3 PM. I say we coordinate for this time, which is 2 PM Pacific Standard time. Thoughts? … I have meant this as more of a support gesture, rather than a pump. It’s a first that a nation has adopted Bitcoin. This is an important time in Bitcoin. Let’s show El Salvador, for those who are on the fence about it still, that Bitcoin has value for them. And for everyone. Bitcoin is meaningful.” The post has more than 2,000 comments, with 86% giving the idea a thumbs up.
Whether the plan comes to fruition is another matter, with Vijay Ayyar, head of Asia Pacific with crypto exchange Luno in Singapore telling Bloomberg it would be challenging. “Saying something and actually doing it are very different,” Ayyar says.
On Friday, SA contributor John Rhodes argued that even “if there’s a high chance of failure, or loss, over a long period of time, Bitcoin can be an outstanding asymmetric bet.”
China and tech
For several months, one of the major topics involving tech companies has been China. Whether it’s been the Beijing government imposing more regulations on its own e-commerce leaders, or fears about shortages in semiconductors and other products made in China, barely a day of late has gone by without the topic of China being brought up in regards to the tech sector.
But, just how much does China weigh on the thinking of top tech chief executives and other corporate officials? Are they that worried about China and its impact on their businesses?
Since CEOs know that whatever they say will be parsed for any hints about where their businesses are headed, they often only speak publicly when they want to promote something positive about their companies. But, one of those rare times when they, or their CFOs, do go before the public is on their quarterly earnings calls. And in addition to telling how well their companies have done over the prior three months, those executives have a fiduciary duty to let their shareholders know about any challenges they are facing. And with China seemingly being a worry to much of the tech sector, those quarterly conference calls would appear to be the appropriate place for company officials to address the China question. But, a look at the recent conference calls of some of the biggest tech companies shows that, in many cases, China doesn’t even warrant a mention, much less a worry, to some top tech CEOs.
Learn more about how Yieldstreet can start your passive income journey today.
Don’t fear financials
Normally a huge miss on headline payrolls (235K vs. 750K expected) would send money away from risk into bonds, pushing yields down and hitting Financials (NYSEARCA:XLF) on net interest margin. But BTIG still has an Overweight rating on the sector, looking at the bigger picture.
“Taking a step back, Financials relative performance vs. the S&P 500 continues to build out a base that has been a decade-plus in the making, after holding the GFC era low,” Julian Emanuel, chief equity and derivatives strategist, writes in a note. “This suggests that should financials maintain their momentum and relative strength break out, there is plenty of room for further outperformance – this is consistent with our view that Value began a period of longer-term outperformance vs. Growth in September 2020.”
Biotech comeback plays
Barron’s spoke with investors and analysts who focus on the biotech field to find names that are poised to make a comeback.
Many biotech stocks have had a tough year so far. The SPDR Biotech ETF (NYSEARCA:XBI) is down 4.7% year-to-date. That compares to a 20.8% return in the same period for the S&P 500.
The companies Barron’s highlights are: Acceleron Pharma (NASDAQ:XLRN), Invitae (NYSE:NVTA), Sarepta Therapeutics (NASDAQ:SRPT), COMPASS Pathways (NASDAQ:CMPS), and AlloVir (NASDAQ:ALVR).
Vaccine boosters
White House chief medical advisor Dr. Anthony Fauci says that the U.S. COVID-19 vaccine rollout scheduled for Sept. 20 will likely start with Pfizer (NYSE:PFE)/ BioNTech (NASDAQ:BNTX) COVID-19 vaccine, soon followed by the introduction of Moderna (NASDAQ:MRNA) COVID-19 booster shot.
Speaking on CBS’ “Face the Nation,” on Sunday, the top U.S. infectious disease expert said Pfizer/ BioNTech have likely submitted sufficient data for regulators to make a decision before the deadline, set by The White House last month. “It is conceivable that we will only have one of them out, but the other will likely follow soon thereafter,” Fauci said.
Today’s Economic Calendar
12:30 PM TD Ameritrade IMX
1:00 PM Results of $58B, 3-Year Note Auction
Companies reporting earnings today »
What else is happening…
Qualcomm (NASDAQ:QCOM) to supply chip for new Renault (OTC:RNSDF) electric vehicle.
Japan to purchase 150M doses of Novavax’s (NASDAQ:NVAX) COVID-19 vaccine.
FDA places clinical hold on BioMarin’s (NASDAQ:BMRN) Phase 1/2 gene therapy study in phenylketonuria.
HUYA’s (NYSE:HUYA) chief financial officer resigns.
111 (NASDAQ:YI) approves $10M share repurchase program.
Deutsche Telekom (OTCQX:DTEGF) nears €5B sale of Dutch unit – Bloomberg.
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