August 9, 2023

📰 News Organizations

• Regulators Hit Banks With $549 Million in Fines. The SEC announced charges against 11 firms for failures to maintain records, by allowing employees to use unsupervised side channels such as messaging apps WhatsApp and Signal. Wells Fargo was the biggest U.S. bank cited.
  

• SoftBank Plans Fresh AI Bets After First Investment Gains in 18 Months. SoftBank reported $1 billion in investment gains at its flagship Vision Fund unit during the April-June quarter. The company said the number of companies in its Vision Fund 1, Vision Fund 2, and Latin American funds nearly doubled.
  

• Worst Earnings Quarter in Years. Earnings for the biggest U.S. companies are poised to fall for the third straight quarter, hurt in part by the decline in energy prices. The members of the S&P 500 are on pace to collectively report a 5.2% decline in earnings, their worst performance since 2020.
  

• Apple Tests M3 Max Chip for Most Powerful MacBook Pro Yet. The new M3 Max chip includes 16 main processing cores and 40 graphics cores. The processor is at the heart of a high-end MacBook Pro laptop — a model codenamed J514 — that’s expected to debut next year.

• Charlie Ergen Nears Deal to Merge Dish, EchoStar. It's a move aimed to build a nationwide wireless network strong enough to take on the likes of AT&T and Verizon. It would reunite Dish’s pay-TV business and 5G network with EchoStar’s satellite communications infrastructure.
  

• Nvidia Unveils Faster Chip Aimed at Cementing AI Dominance. The Grace Hopper Superchip, a combination graphics chip and processor, will get a boost from a new type of memory, Nvidia said Tuesday. The new chip will drop the cost of large language models significantly, according to Nvidia.

🐦 Twitter

• One of the key events this week will be $103 billion of Treasury auctions that start Tuesday. If they go better than expected, that'll allay fears that there aren't as many buyers for a market that's tripled in size since 2009. If not, that'll be a problem. Source.
  

• Over $200 Billion of Apple's $AAPL market cap has evaporated over the last 5 trading days as the stock suffered its first 5-day losing streak of the year. Source.
  

• Credit card debt rose $45 billion in the 2nd quarter, an increase of more than 4%, to above $1 trillion for the first time ever. As #inflation pushes consumer prices higher and real wages lower, more Americans are turning to credit cards to make ends meet. Source.
  

• Last week, Fitch downgraded the US long-term credit rating and markets tanked. Then, JP Morgan said they no longer expect a recession, and markets tanked. Today, Moody's downgraded regional banks' credit ratings, and markets tanked. Are markets worried about a credit event? Source.
  

• Global food prices still in decline but trend is reversing. The UN Food and Agriculture World Food Price Index fell by 11.8% year/year in July; still a large drop relative to history but less negative than in prior months. Source.

📓 Online Publications

• Trade Deficit Decreased to $65.5 Billion in June. The goods and services deficit was $65.5 billion in June, down $2.8 billion from $68.3 billion in May, revised. Exports and imports decreased in June. But net exports of petroleum products are positive and have picked up.
  

• United Parcel Service Stock Down After Earnings Report. UPS beat earnings expectations in the quarter, though it missed on revenue and volumes. The company spent much of the quarter trying to avoid what would have been a costly strike by its Teamsters.

• Tilray Has Become The Fifth Largest Craft Brewer In The U.S. It just announced a major addition to its portfolio with the acquisition of eight beer and beverage brands from Anheuser-Busch InBev. Tilray is adding brands including Shock Top, Breckenridge Brewery, and Redhook Brewery to its portfolio.

🎧 Podcasts

• Home Price Appreciation by August. The rate of home price appreciation has really bottomed out starting in April and May at about 2% year-over-year and analysts are now predicting that home prices have turned a corner based on economic data and predicts 4% home price appreciation by August. Source(11:12)
  

• Meta Disbands Protein-Folding Team In Shift Towards Commercial AI. Meta ditched the first database of more than 600mn protein structures. The project could have helped develop new drugs and treatments. This shows that Meta is focusing more on AI projects that can generate revenue. Source(0:52)
  

• Campbell To Buy Rao's Premium Sauces Maker Sovos For $2.33 Billion. Campbell will pay $23 per share for Sovos, a nearly 28% premium to the stock’s last close. Including debt, the deal is valued at $2.7 billion. Campbell plans to finance the purchase through new debt. Source(15:00)
  

• Berkshire Hathaway Hits All-Time High. Berkshire Hathaway's stock hit a record high of nearly $552,000 per share after strong earnings showed a record operating profit of over $10 billion. Berkshire's market cap now approaches $800 billion, making it one of the largest U.S. companies, bigger than giants like Tesla and Walmart. Source(7:04)
  

• Recession Still Plausible If Wages Don't Rise. Andreas Steno Larsen says that declining taxes and stagnant corporate profits, coupled with the need for wage growth to sustain gross domestic income, suggest a recession might still be plausible if wages don't rise significantly in the next quarters. Source(9:29)