FEBRUARY 10, 2020
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SOMETHING SOMEONE ONCE SAID
“Would I rather be feared or loved? Easy. Both. I want people to be afraid of how much they love me.”
-Michael Scott, The Office
The ink drying on the phase one trade deal between the US and China in January is good news because it’s a clear sign that the two nations are willing to play nice-ish going forward. But it’s important to remember that steep tariffs will remain in place, and solving the major issues lurking in the next phase is going to be a serious pain in the a$s. The current agreement means the US will suspend its next planned round of tariffs, while slashing the existing tariff rates on around $110 billion of Chinese imports from 15% to 7.5%. In exchange, China has pinky promised to: up its US imports by around $200 billion over the next two years, allow more access to its markets for financial services companies, enforce intellectual property protections, and be more transparent about how the country manages its currency. The key now will be to see if upcoming economic data releases reflect that global businesses feel empowered enough by the deal to go forward with investments that were put on hold in 2019.
The US economy grew at an annualized pace of 2.1% in the last quarter of 2019 and continues to chug along. Manufacturing remains weak, with the December release of the Institute for Supply Management’s (ISM) manufacturing data showing that the sector continues to atrophy. The services side of the economy remains resilient, though, and the ISM non-manufacturing survey picked up 1.1 points in December. And the consumer – the lifeblood of the US economy – is still feeling quite peachy about things, with confidence rising significantly in January.
In general, the economy has been evolving largely in line with the Federal Reserve’s outlook for moderate economic growth and a solid job market. That’s why the decision to keep the key interest rate unchanged at the January meeting was unsurprising.
The US earnings season for the fourth quarter of last year is well underway with many companies continuing to exceed expectations. Earnings per share and sales are growing at 6% and 2% year on year for the S&P 500.
TOP PERFORMING S&P STOCKS (YEAR-TO-DATE)
1) NORTON LIFELOCK (NLOK) +31.41%
2) L BRANDS (LB) +30.13%
3) LENNAR CORP (LEN) +23.89%
4) SERVICENOW INC (NOW) +20.81%
5) BALL CORP (BLL) +18.94%
TRENDING ON TWITTER TODAY
2. PHILIP RIVERS
"I love Mondays." Said no one, ever.
Apparently, someone had the idea to make socks based on carpet designs from US airport terminals. And, apparently people in Orlando (MCO) are pretty geeked about it. Yes, airport carpet – that’s what people are into. And it’s the year 2020.
Record-shattering MC Nicki Minaj hosts her own show on Apple’s Beats 1 music radio station. She dishes on her favorite tracks and tackles a wide variety of questions in a raw, um, unfiltered format. Color this one #NSFW.
After 16 years as quarterback of the LA Chargers, Rivers and the team are parting ways. The North Carolina native has played his entire career with the team and no one’s sure where he’ll go next. And it looks like Twitter peeps are worried they may have seen the last of ol' man Rivers.
President Trump unveiled his $4.8 trillion budget that proposes cuts to programs like Medicaid and food stamps, while boosting defense spending by $740 billion. Not surprisingly, Twitter followers have a lot to say about it.
FINANCIAL ARTICLES WE LOVE
1. Making Sense of What May be a Tesla Bubble
Tesla is all the rage these days as the stock continues to soar to new heights. This article explores if we’re reaching bubble territory with Elon Musk’s electric vehicle behemoth. Read here.
2. Does Everyone Need to Fill Out an Income Tax Return?
Tax season is around the corner and, let’s be honest, we all could use any help we can get. If you’re pondering the question of whether or not to fill out an income tax return, well, you’re welcome. If not, enjoy this video of a cat running around an NFL football field during a game. Read here.
3. Career Builder’s CEO: Young People are Ghosting Their Employers
Typically reserved for the dating world, the term “ghosting” (when someone in a relationship breaks up with the other person via not responding to texts / calls) is popping up in the corporate world. Apparently, many Gen Z’ers (people 8-23 years old) are leaving their jobs without telling their employer. #burn. Read here.
Which nation can claim it has more islands than any other country? Check the answers in the black box below.
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ONE GOOD THING
No doubt, we hear a sh*tload about startups these days, but no one really shares insight into how to spot the ones worth investing in. Enter Sam Altman. He’s the former president of Y Combinator — the venture capital powerhouse that’s funded names like Dropbox, Stripe, and Airbnb. Ya know, itty bitty brands. Altman’s also personally been an early investor in Reddit, Instacart, and many others. (While we’re name- dropping, he’s also home boys with some guy named Elon Musk.) In this edition of one good thing, Altman drops some knowledge on how to be a good startup investor what characteristics he looks for in this space.
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TRIVIA ANSWER: Sweden. With roughly 221,800 islands, the Swedes are earth’s leader in owning the most pieces of sub-continental land surrounded by water. However, only about 1,000 of these islands are actually inhabited. Because no one grows up dreaming of living on a desolate arctic island in the North Sea.
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