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"M3GAN" is getting a sequel after smashing the box office

The "M3GAN" sequel is set for release in 2025. The movie was made with a $12 million budget, and has earned nearly $100 million worldwide. M3GAN 2.0 is slated for 2025.Universal Pictures "M3GAN" is getting a sequel, set for release in 2025. It's earned $95 million worldwide in just over two weeks of release, and was made for $12 million. It shows the power of a potential merger between its production companies, Blumhouse and Atomic Monster. "M3GAN" is coming back.Production studios Blumhouse and Atomic Monster announced on Wednesday that they've greenlit a sequel to their hit horror movie, about an AI-powered doll that torments any humans she thinks will harm her owner.The sequel, titled "M3GAN 2.0," is set for release on January 17, 2025. Stars Allison Williams and Violet McGraw are expected to return."M3GAN" has been a box-office smash since debuting on January 6, earning $95 million at the global box office so far, $60 million of which is from the US.It was made for just $12 million, according to IMDb Pro.Blumhouse and Atomic Monster — two leading horror-movie studios led by Jason Blum and James Wan, respectively — are in talks to merge, The New York Times first reported in November. "James is probably 70 to 80 percent artist and 30 to 20 percent business person, and I am the reverse," Blum told the Times. "We really do complement each other, yin and yang, which is part of what makes this so exciting.""M3GAN," which the two studios combined forces on, presents a look at the power of the potential merger.Wan has directed and/or produced the "Conjuring" franchise, and Blumhouse specializes in low-cost horror hits that make big profits, such as "Get Out" and the 2018 "Halloween" reboot.Blumhouse has a first-look deal with Universal, which distributed "M3GAN" to theaters. NBCUniversal CEO Jeff Shell was giddy at the prospect of the Blumhouse-Atomic Monster merger during a conference last month."If that should happen, we are going to be in an absolutely impregnable position," Shell said.Read the original article on Business Insider.....»»

Category: dealsSource: nytJan 18th, 2023

Transcript: John Mack

     The transcript from this week’s, MiB: John Mack, Morgan Stanley CEO, is below. You can stream and download our full conversation, including any podcast extras, on iTunes, Spotify, Stitcher, Google, YouTube, and Bloomberg. All of our earlier podcasts on your favorite pod hosts can be found here. ~~~ ANNOUNCER: This is Masters… Read More The post Transcript: John Mack appeared first on The Big Picture.      The transcript from this week’s, MiB: John Mack, Morgan Stanley CEO, is below. You can stream and download our full conversation, including any podcast extras, on iTunes, Spotify, Stitcher, Google, YouTube, and Bloomberg. All of our earlier podcasts on your favorite pod hosts can be found here. ~~~ ANNOUNCER: This is Masters in Business with Barry Ritholtz on Bloomberg Radio. BARRY RITHOLTZ, HOST, MASTERS IN BUSINESS: This week on the podcast, boy, do I have an extra special guest, John Mack, legendary CEO of Morgan Stanley. Man, this is just a masterclass on leadership, on team building, on understanding a business and understanding what to do for your clients. So not only that they give you business, but they give you their loyalty and their ongoing respect. I don’t know what else to say other than my conversation with Morgan Stanley’s John Mack. I’ve been looking forward to this conversation for quite a while. As soon as I saw the book came out, I have to really get the inside dope from John. And so let’s start with the beginning. You start at Smith Barney in 1968. What was so compelling about a North Carolina kid from Duke going to Wall Street? JOHN MACK, FORMER CHIEF EXECUTIVE OFFICER AND CHAIRMAN OF THE BOARD, MORGAN STANLEY: Well, it’s pretty simple. So I was on scholarship at Duke, an athletic scholarship and cracked C5 in my neck. So my scholarship was only valid for four years, and I needed one class to graduate. I had very little money, and my father had passed away when I was in college. So I needed a job. And I went down and knocked on the door at a company called First Securities of North Carolina. A guy named Bill Bonner said, look, you know, nothing about the business, I’ll put you in the back office. And you can go to your one class every day ahead, and then go on your lunch hour and come back and go to work. So it was me and nine women in the back office, and they had the old IBM computer punch cards. That’s how long ago it was. So I got a sense and a feel for the business. And I got to know a lady named Fannie Mitchell, who ran job placement for Duke University. So when people would come down and say, you know, Procter & Gamble or IBM, whoever it may be, she would say, you got to talk to this John Mack. And I think, you know, I would see her in the cafeteria and most students would ignore. I’d sit down, have a cup of coffee with her or have lunch with her. So that’s how I got involved with the securities business. And then the Smith Barney was in town and they were going to open an office in Atlanta, and they ended up hiring me to go to their Atlanta office. So I come up to New York in ’68 and I’m working at Smith Barney, and they decided because of the explosion of volume, the New York Stock Exchange stopped all new branches from opening. So I got a chance to go in the municipal bond department. That’s what I did. I was a trader-salesman, and I learned a lot about risk. And I also learned a lot about drinking at lunch, and you got to be very careful. RITHOLTZ: Going out with clients, having a couple of drinks. Hey, you come back to the desk, a little buzzed, what happens? Can you make a trading mistake that way? MACK: Well, not only you can, I did. We went down to Chez Yvonne, if you remember that years ago, down on Wall Street. U.S. Trust was my client, a guy named Jimmy Degnan. And U.S Trust was the advisor for the state employees of New York, which is a huge pension fund. RITHOLTZ: Giant. MACK: So we sat there and we drank for at least three hours. RITHOLTZ: Now, wait, are you normally a drinker during lunch, or if the client is drinking, you got to keep up? MACK: I’m a client guy. No one wants to drink alone. So if he’s drinking or she’s drinking, I’m drinking. I came back and I made a mistake. And thank God, they didn’t fire me. And over time, we eradicated that and fixed it. And then I learned be very careful when you go out to lunch on Wall Street. RITHOLTZ: So tell us a little bit about the culture on the street in the late ‘60s and early ‘70s. What was it like? MACK: It was a crazy time. The thing of politically correct didn’t exist. RITHOLTZ: To say the very least. MACK: All right. So I’m 21, 22 years old. I’m at Smith Barney. I’m a municipal trader. Then I go into the corporate bond market. And I hear about these crazy parties that Wall Street was throwing and I only went to one and left. I mean, it was basically strippers and people getting drunk. And you know, I came from a town of about 12,000 people in North Carolina, a Baptist religion, mainly. It was a new world for me, but it taught me a lot. You got to pay attention and you got to make sure that you don’t get drunk at lunch and you got to make sure you tell the truth. RITHOLTZ: Telling the truth is certainly a key part, and that’s a theme that comes up again and again in your book. We’ll get to that in a little bit. You mentioned the New York Stock Exchange didn’t allow any new branches to be open. I have a vague recollection of Wall Street being closed on Wednesdays to catch up on the paperwork. Tell us a little bit about that. MACK: That’s correct. They closed on Wednesday to catch up on the paperwork, and all the firms, whether it was, first of all, Morgan Stanley, Goldman Sachs, and Morgan Stanley at that time didn’t have a big secondary business, we had to clear up the back office. So you’d shut at noon and try to figure out the securities go to Y and these securities go to Z. RITHOLTZ: Literally paper certificates, runners up and down the street — MACK: Absolutely. Absolutely. RITHOLTZ: — and delivering. MACK: Absolutely. RITHOLTZ: Talk about, you know, ancient technology. One of the things you mentioned was that by the 1980s, there were two key forces driving changes on Wall Street; deregulation and technology. MACK: Right. Correct. RITHOLTZ: Tell us about that. MACK: Well, the markets were changing, they were global. And as they became global, and you were competing around the world, it was clear that you needed to free up our securities business to be more active on a global basis. So we got rid of a lot of regulation. We got more oversight, but not regulatory control. I mean, clearly reported to the SEC, York Stock Exchange, et cetera. But it wasn’t smothering. I mean, you know, we were not used to it. But it was the right thing for the New York Stock Exchange to do. There had to be more regulation. And you know, as I said earlier, it’s a global market, and you want to make sure that we represent in New York Stock Exchange and really America the proper way, and it worked. And the U.K. was much stricter than we were; and in Germany, they restricted than we were. And clearly, the Japanese were stricter than we were. And over time, all these different regulatory areas from around the world, came up with a conclusion that we need kind of an overall management system for risk and regulatory oversight. So if you took a big risk in China, in Japan or in Europe, you needed to roll that up, so the U.S. regulator or the U.K. regulator could see what your overall risk was. I think that was a huge and a very important move. RITHOLTZ: You spent the first part of your career primarily in fixed income. First, you mentioned municipals — MACK: Right. RITHOLTZ: — then corporate. What was the appeal of the bond side of the business? MACK: Well, originally, when I joined Smith Barney, I was going to go to Atlanta in the retail office and cover Florida and other southern states. And then I got to know a guy named George Wilder who had been in the municipal bond business, and a guy named John McDougall who was a municipal bond trader. And they convinced me, you know, I want you to stay in New York, you’re a great salesman, and you can sell and trade munis with us. And I like New York and I like the business, and I like the investment world of large pension funds, money managers and things like that. So we did a combination of things, we covered clients, and then we satisfied the desire of retail salesmen who wanted to buy munis in New York state or in California or Florida. So that’s how I got into the bond business. RITHOLTZ: What was it like trying to build a team on a bond desk that described in the book, could get a little frenetic? MACK: Yeah, it was. But you know, we built it over a long period of time, and we all grew up over that period of time. And you’ve learned that, number one, you had to be upfront. You had to focus on your clients. You couldn’t get drunk at lunch, which occasionally, we all got drunk at lunch and sometimes made a mistake. And you learn to focus on your client and you know, it became a very personal business. And you got to know who they were, you got to know their families. And I remember when I was at Smith Barney and then at F.S. Smithers, I was given the worst accounts because I went from trading to sale, so we’ll dump all these accounts on John Mack. RITHOLTZ: Give it to the kid. MACK: You got it. And there was a gentleman named Dick Vanskoy at the Mellon Bank, who managed and advised the state employees of Pennsylvania teachers and retirement funds. Huge — RITHOLTZ: That’s a big account in Pennsylvania. MACK: It was huge. RITHOLTZ: Yeah. MACK: But he was tough as nails. And you learned very quickly, that you better be on your toes when you deal with Dick. And I got to know him, he was a great mentor, taught me a lot about the business. And I spent a lot of time in Pittsburgh, even to the point that my wife and I would go out. I mean, I remember going out to Pittsburgh with these huge funds, it was probably the largest account in the country, at Mellon Bank at that time. RITHOLTZ: Really? MACK: And a guy named Jackie Kugler at Salomon Brothers, and Salomon was the dominant player in the bond market. They were the number one broker-banker for the pension funds for the state of Pennsylvania, both the teachers and the employees. And I just kept digging away, working hard at it. And over time, I became the number one dealer they dealt with. And George Polachek (ph), who came over from Ukraine after the Russians back then took over in World War II, was running it. He had been at Sun Life in Canada. And I got along with him well, and I did a lot of business with the Mellon bank, to the point I became their number one broker-dealer. And Polachek (ph) who loved martinis, walked onto the Salomon floor and screamed out to Kugler, how does it feel to be number two? That’s the environment we’re in. And I’ll tell you, I mean, I think business is personal. And we got to know the people at Mellon bank, whether it was, you know, Sally Yeh’s daughter who was in med school, or George Polachek (ph) who was going back over to Europe for a while. We really worked at getting to know people and building trust. And at the end of the day, it’s all about trust and it’s all about delivering what you say you’re going to do. And with the help of a lot of people, that’s what we did. And of course, my partner in all this was Christy Mack. And as I said earlier, my clients say, look, John, we really don’t care about you. It’s on Christy, yeah. RITHOLTZ: Your wife? MACK: Yeah. No. She was awesome, and is awesome. RITHOLTZ: So you eventually become head of the Fixed Income Department. MACK: Right. RITHOLTZ: And what was it like to go from sales and trading to managing a whole team of salespeople and traders? MACK: Well, it was very different and I learned very quickly, thank God for Dick Fisher, that you have to be more balanced and not as, I don’t know what the word is, aggressive, ruthless, uncouth, all of those words. We used to sit in clusters of four salespeople together, and we probably had five clusters. And one of my rules were that the desk can never be empty, you always need one person there. Because, you know, if no one is there and the phone rings, no one is picking it up. RITHOLTZ: Right. MACK: Occasionally, you know, no one was there. And I’d walk in and be really pissed off about it, and reach over and I would just clean the desk off on the floor. RITHOLTZ: Like, wipe everything — MACK: Everything. RITHOLTZ: — onto the floor? MACK: Right. And thank God for Dick Fisher and he said, look, John, you got the biggest gun in the firm, in that division. Your job is never use your gun. So I learned a lot from him and I calm things down. I wasn’t as aggressive, wasn’t as pushy, but I was still demanding. And look, it’s a great business with great opportunities, but you got to pay attention. You got to pay attention to the people around you. You got to pay attention to your clients. And this idea of especially at Morgan Stanley, the surest way to be fired at Morgan Stanley is the word got back, you got a client laid somewhere, you’re gone. There’s no debate, no discussion. So we really focused on trying to get close to our clients, give them what they needed, introduce them to other clients that also had similar asset management responsibilities. And Morgan Stanley at that time was really growing from a pure investment bank that covered, you know, AT&T, IBM, Southern Cal, you name it, they had it, the Government of Japan. And we really worked at imbuing that culture of first class business in a first class way into the Morgan Stanley sales and trading business. RITHOLTZ: So let’s talk a little bit about some of the things you discussed in the book. You described how different Wall Street is today from when you began. Tell us a little bit about the process of finance being institutionalized, and how the culture has changed. MACK: Well, I think the biggest change is the markets became so big and global, that Wall Street had to change. So if you go back to when I started the business, basically, your client base was here in the United States. But over time, as globalization took place, your clients would be all over the world. And people were more and more focused on what are the maximum returns we can make in investing. And it got to be a 24 hours a day trading, whether you’re in China or Japan or Europe or U.S. So you had to be on your game, and you also had to be available to do business at night. And our traders oftentimes will stay up all night to satisfy inquiries coming in from China or be there early in the morning for London. So globalization was the big change, and then technology added to it. Technology allowed people to see markets and here we are at Bloomberg, they were looking at machines. They could tell you what was going on in Hong Kong or what was going on in Europe. So the markets became 24/7. And as a result, you had the staff and in my case, the fixed income division, you needed people around the world to be able to satisfy clients who are investors, and at the same time, satisfy clients who are raising money through Morgan Stanley. So if AT&T was doing a big bond deal, we want to make sure that, you know, the Japanese, the Chinese and just go around the world, the Middle East, London and back to New York, that all of our clients got a chance to see and talk to a salesman who had information about the transaction we were doing for AT&T. So globalization was the big change. Then add to that, and here we are at Bloomberg, technology. You know, when I got in the business, there was no technology. You had a little machine that would do interest rates for you. You know, you’d put in a price and it would give you what the yield is. But now, you go into Morgan Stanley, you go into JPMorgan or Goldman, it makes no difference. Every desk has a box with data and information. And if you go back when I got in the business in early, early ‘70s, matter of fact, in the late ‘60s, that didn’t exist. I mean, people would go out for lunch, and you know, take a couple hours. You didn’t miss anything. But today, you don’t leave your desk. RITHOLTZ: Right. And I’d say the very least. So you helped to build a very special culture at Morgan Stanley. What goes into building a competitive investment bank? How do you create and sustain that culture? MACK: Well, I think by and large, people who come into the business are competitive. They want to achieve and they want to do well. What I was trying to do was to take all this, I guess courage is the wrong word, this aggressiveness, this ability to build business, and how do you make it into a one firm versus the guys in San Francisco, they get an order, don’t share it with New York. If we do it, you know, we’ll get more of a commission. So what I was trying to do when I took over the fixed income division is to create a one firm entity. I call it the one-firm firm. And I brought in a guy named Tom DeLong, who I’ve met on an airplane. So Christy and I were out in Utah, we were looking at buying a house because we started picking up skiing. And by the way, I’m a terrible skier. So I’m talking to this guy on the plane and I said to him, what do you do? And he said, I’m a professor at BYU, and I’m coming back to talk to AT&T, their management group about, you know, managing people and evaluations, et cetera. And I said, well, look, I’d like you to come in and see me when you have time. I’d like to talk to you. So Tom comes in. And by the way, now, Tom is a professor at Harvard University. So Tom comes in and he interviews my senior group. And he comes in, he said, well, here’s what people think, to get ahead at this division, they have to be your friends. RITHOLTZ: FOJ. MACK: Exactly. That’s right. And if they’re not your friend, they don’t make it. And he said, that may not be reality, but that’s what they all believe. RITHOLTZ: That’s the perception. MACK: So he said, what you should do is set up an independent group of people. Let them make a presentation to you of the talent that should be promoted. And you know, if you have a strong objection, you can say that, but by and large, you should accept what they put in front of you. So that’s exactly what they did. They took me picking who’s going to be promoted. And there was a promotion committee, and also a compensation committee. And then they would come to me and make recommendations. And so you didn’t favor one person, you had somewhere between four and eight people on these committees. And when they brought it to me, unless I had something very specific that I’d say, well, let me tell you why I disagree, I accepted the recommendation. And that move really changed the culture of the division, and it came into, you know, you don’t have to be Max’s friend (ph) or anyone else. It’s about being professional, direct and honest. And your peers would do the evaluation on how you’re doing, what you’re doing and what you should be doing. RITHOLTZ: This is the full 360 review. MACK: Exactly. RITHOLTZ: And the peers would also anonymously review their managers. MACK: Absolutely. RITHOLTZ: And what was the results from those sorts of things? MACK: Well, in some cases, we found that managers were not setting the right tone as far as being energetic and working with them. They were reluctant, oftentimes, to go out with salesmen and help them entertain with clients or spend time with clients. So it really put more pressure on managers to be involved and not just sit in an office or on a trading desk at the far end, and just, you know, take advantage of people working hard, but they’re not involved. So we got more involved. And it also got us to eliminate some of the managers. When you saw these 360 reviews and some of the data, and then you would dive into it and find out they’re right, we’re not going to have people like that at this firm. So not a lot of reduction at headcounts, but a few people we asked to leave. RITHOLTZ: And you talked about the willingness of senior management to assist with clients. You seemed to be ready to jump on a plane to go anywhere in the world, China, to Tokyo. It didn’t matter if you could help close a deal. You were there. MACK: That’s true. I mean, number one, I love the business. I mean, to go to China and build the relationships we built in China, or go to Europe, it didn’t make any difference where I went. I love the business. And you know, China was just opening up. And one of the guys who used to be at the World Bank said, you know, John, what China really needs, I think it was Ed Lim, it needs an investment bank. So we formed a small investment bank owned mainly by the Chinese, but Morgan Stanley on 30% of it. And we built a securities business with the Chinese in China. And Wang Qishan, who was the Vice Premier, he was the gentleman I worked with. And it took a lot of time, but the Chinese wanted create their own capital markets. They wanted to be independent, and they wanted the ability to go around the world and raise money, because we do in any American investment bank. And I’ll tell you one of the things that really touched me. We’re talking about China, but let’s say China Communist. We’re talking about diehard communists. Wang Qishan who was running the central bank at that time, and then he was given the responsibility by Zhu Rongji to build a securities business. And I’m working with him to do this joint venture and he flies over to New York, and we’re sitting in my office on whatever floor at Morgan Stanley. And we’re there for about an hour and a half, we’re making zero progress. We’re not getting anywhere. And I’ve been in Europe with him and talked to him over there. We were making progress there. And now here he is in New York and there’s like a big heavy stone on him. I looked at him and I finally figured out he’s a chain smoker. I said Qishan, light him up. He said, I can’t do that. I said, what do you mean you can’t do that? He said, in New York, you can’t smoke inside. I said, in my office, you can do anything you want. Light him up. And he smoked Luckys. Can you imagine smoking Luckys? He smoked Luckys, he lit up, we got the deal done. RITHOLTZ: No filter, right? MACK: No filter. We got the deal done. And I keep reflecting back, you got to pay attention to the person who’s in the room with you. RITHOLTZ: But I’m impressed that he knows the local rules and customs in New York. MACK: Yeah. Very respectful. RITHOLTZ: That’s really impressive. So you open this joint venture in China. Is Morgan Stanley the first U.S. Bank to open a joint venture in China? MACK: It was. I know the U.K. banks, Hong Kong bank out of a U.K. ownership. But we were the first bank. But you know, I’m sure JPMorgan had some kind of outlet there, but more for banking and taking deposits and doing traditional banking business. But from a trading point of view, securities business, thanks to Ed Lim, who as I said, worked at the UN said, you know, China really needs capital markets and this investment banking business. And with his help, we started a small investment bank there which continued to grow. RITHOLTZ: So not just the division in China grew, but all of Morgan Stanley grew. And eventually, you came to realize, hey, we have all this investment banking and trading experience, but we don’t have a retail force, the way somebody like Merrill Lynch does. And lo and behold, along comes Dean Witter — MACK: Right. RITHOLTZ: — potentially a great merger candidate. Tell us a little bit about why that seemed like a good idea at that time. MACK: Sure. Well, what we saw in Merrill Lynch, which traditionally had been a pure retail firm, because of their huge network, number one, they had better information not only from what’s going on in the retail market, but also from institutions. You know, if you were in Des Moines in Iowa, and you knew the local president of the First Bank of Iowa, you got better information. And if they were going to buy Treasury securities, or municipals, you got that order. So we saw that we were getting limited information. And then Sears, who had bought Dean Witter. I think it was Ed Brennan and Phil Purcell had been a management consultant I think from McKinsey, but not sure of that. And he convinced Brennan that, you know, if you really are going to be in retail, you have Sears stores everywhere. Every city of 100,000 people, there was a Sears store. And he said, you know, we ought to open up Dean Witter offices in all these Sears stores, and that’s what they did. And it grew and grew. And then they came to the point that Purcell convinced Sears, let’s spin it out and take this company public. So Morgan Stanley was chosen to be the lead underwriter on the spin-out of Dean Witter from Sears. So Dick Fisher calls me and I meet Purcell, who I liked, and I looked at their business and the information they were getting from clients versus what we were getting. And they were in every, well, how many Sears stores are there? They were everywhere. RITHOLTZ: At their peak, I think there were like 3,000 something. MACK: Yeah. So they had better information. RITHOLTZ: Yeah. MACK: So, you know, we talked and talked. And finally, we came to the conclusion on a handshake to do the deal. Sears and Dean Witter was much larger in market cap than Morgan Stanley. So it was agreed upon, and he wouldn’t do it without being the CEO. And we had a couple of dinners in New York with Dick Fisher and him, Ed Brennan. And to get the deal done, he had to be the CEO. So Fisher says to me in a private meeting in his office, I’m not going to let you do this trip or do this management training. I said, well, Dick, at that point, it’s not our firm, it’s shareholders’ firm. And for me to say that to Dick Fisher was kind of ridiculous because he was always teaching me about the business. And he was a wonderful man and a smart man. So I said, look, this is what makes sense for shareholders. I’ll take the number two job. Phil is a good guy. I’ll get along with him. And let’s do this merger. And we did. And what we also inherited when we did that merger was Discover card. RITHOLTZ: Which was also a money machine. MACK: It was a money machine. But you know, we clashed, and we clashed in the sense, like I said I think earlier, if I were out in Sacramento, seeing the state funds of California, and I had an extra hour, I would drop by, you know, the local office, the Morgan Stanley Dean Witter office, and go and talk to a salesman. And clearly, you know, salesmen who are on commission, by and large, do a good job, but always have complaints. And I heard the complaints and I came back and I talked to the manager of all retail, and I talked to Purcell. And then Purcell said to me, you know, John, you can’t do that. I said, what do you mean I can’t do that? You can’t just drop into office and talk to them. I said, well, last time I checked, you know, you’re the CEO, but I’m president of the firm. I’m in Sacramento, seeing Safeway stores, and you’re telling me I can’t go into the office and talk to them? He said, well, you know, Ed Brennan would never do that at Sears. And I said, you know, this is not serious. And so right then, we knew we had an issue. RITHOLTZ: Right. He was very risk averse and you were very hands-on. MACK: Right. RITHOLTZ: It seems like from day one, a clash of the Titans was teeing up. MACK: Yeah. But not from day one. I mean, look, they had built a great business in retail, Dean Witter. They had brokers all over the country doing business. They didn’t have an international business. I think they thought international was going to Canada. It was just two different cultures. And no one challenged or spoke up either to a guy named Jimmy who ran the retail business or, clearly, Purcell who ran both retail institution and the credit card business. And my view at Morgan Stanley and I did this with Dick Jake Fisher, and people did it with me. In my office, I don’t care what you say to me. I want to hear it and it didn’t matter whether you didn’t do that. And that was the big cultural change. RITHOLTZ: So given the sort of head to head in terms of culture, Purcell’s team, at least for a while, seem to have won. You eventually came to realize he was reducing your authority — MACK: Right. RITHOLTZ: — step by step. And at a certain point, you’re like, I don’t want to just be a figurehead. MACK: Right. RITHOLTZ: And so you resigned. MACK: Right. RITHOLTZ: Tell us what that was like too, you’d been at Morgan Stanley for quite a while. MACK: Yeah. Well, it was difficult, but I couldn’t stay there under a philosophy or a management style where you’re not allowed to go to your boss and tell them, you know, I think you’re a jerk. And I had a number of people say that to me and I didn’t get even with them. I just changed some of the things. Sometimes they were right. I wasn’t sure. It’s just two different cultures. I mean, Morgan Stanley built its business on telling clients exactly what they thought. They didn’t sugarcoat it. They didn’t try to say, you know, maybe a little this, a little that. They told the client, these are the issues. And that’s the way I grew up, and that’s the way Dick Fisher was. So as much as I tried to change, I was miserable. I couldn’t do it. And he put me in charge of the retail system, but everything was bounced through him before I could make any decisions. Look, it’s their style, it had been successful. The retail business was important to the firm. And by putting retail and institution together, we had tremendous clout. But from a managerial point of view, it’s not the culture I wanted to be in. RITHOLTZ: Let’s talk a little bit about a period where you were just bored golfing. You leave Morgan Stanley. You’re really not sure what the next chapter in your life is going to be. And then you get a phone call about the mess that was Credit Suisse. MACK: Right. RITHOLTZ: What made you attracted to coming in and trying to clean up Credit Suisse First Boston? MACK: Well, I got a call from Lionel Pincus and I assume — RITHOLTZ: From Warburg Pincus? MACK: Right. They had a big investment with the Swiss and they were not happy with what was going on. So I met with him, and I met other people in the management of Credit Suisse. And I said to Christy, I would rather do this job and regret it than not do this job and regret it. So that’s how I made the decision. RITHOLTZ: Regret minimization framework. MACK: Exactly. RITHOLTZ: A good way to think about it. We should talk more about your wife because it seems like she regularly gives you good advice and send you off to apologize for something you said. MACK: That’s true. RITHOLTZ: And you talk about that in the book. We’ll circle back to that later. So I’m amused by the headline, Wall Street Fears Big Mack Attack. What was the expectation post Morgan Stanley? What did the street think you’re going to come in and do with Credit Suisse? MACK: Well, in Morgan Stanley when I thought, especially in the fixed income division and at that time, it’s the only thing I ran, that we were too fat. You know, we need to do a reduction. So I did and — RITHOLTZ: And this isn’t just headcount. You described some pretty egregious spending — MACK: Oh, yeah. RITHOLTZ: — going on at Credit Suisse. MACK: Yeah. Well, it was totally out of control. And you know, the Swiss were kind of absentee landlords. And they were used to getting all this money in a Swiss bank account and a lot of money coming in, I assume, from other parts of the world. So it was pretty easy when I got there, that we had to do some headcount reduction. When I got there, through my bankers who had worked for me at Morgan Stanley, who were big in technology, Frank Quattrone — RITHOLTZ: Sure. Giant. MACK: — and his team. And when I saw what kind of money they were making, it was mind-boggling. So I flew out to see them and I said, look, guys, I’ll pay you a lot of money. There’s no question about that. But what you’re doing, and the amount of money you’re making now versus the rest of the firm, and using the balance sheet in the firm is unacceptable. So we’re going to have to figure out a way. I want you to make a lot of money. I think it’s a great motivator. But this is totally out of control. And I wish I could remember exactly some of the numbers, but they were numbers like I’d never seen before. RITHOLTZ: It was order of magnitudes larger than the rest of the street? MACK: It’s big. They got a piece of every deal. They did. RITHOLTZ: Personally? MACK: Personally. So you know, one of them says, you know, John, this is in our contract. But I think this compensation is way out of kilter. And just to add a little color to this, when I said to them I want to come out and I want you to come to New York, and we got to talk about these contracts. And this is after 9/11. And they say, well, we’re afraid to do that. I said, well, tell me why. Well, after 9/11, we don’t go to New York. I said, okay, pick a city, I’ll meet you in the city. So I met them in Denver. When I think about that, how absurd that is. So I flew out to Denver, and I took Steve Volk who had been at Shearman & Sterling as the lead lawyer, lead partner. He had joined me to help clean up Credit Suisse. So I sit with George Boutros, Quattrone and I think a guy named Brady, and I said, look, I want you to make a lot of money. I don’t have any issue with that. But this is craziness and I can’t do that. And they said, well, look, it may be craziness, but that’s our contract. I said, it may be your contract and I’ll see you in court and we’ll fight it out. And I gave up the contracts, but I still paid them a lot of money. But you can’t create a culture when you have one-offs doing whatever they want to do. RITHOLTZ: You described it as anyone with a personal fiefdom is a terrible idea for a firm. MACK: Absolutely. And they’re good. They were smart. You would like a room full of Frank Quattrones. But you got to be managed and you got to be a team player. RITHOLTZ: So someone said to you around this time, hey, we’ve given up a lot of money. What about you, John, what have you given up? MACK: Yeah. RITHOLTZ: And what was your response? MACK: I gave up the contract. RITHOLTZ: So you gave up about a third of your salary? MACK: Yeah, I did. RITHOLTZ: That’s a big chunk of cash. MACK: But if you’re going to ask people to give up their contract, you can’t be different than them. This term that I run from Tom DeLong, it’s a one-firm firm, we all have to be in it together. So for me to keep the contract, it’s just not the right thing to do. And also, I learned so much from Dick Fisher. I’m looking way down the road. I’m not looking about what’s going to happen next week or two weeks from now. RITHOLTZ: Well, that’s a good strategy in investing to say the very least. You wrote in the book, the Swiss and Swiss bankers were unlike any other bankers you work with in the U.K., in China, in Japan. What made the Swiss so much of a one-off? MACK: Well, they were very independent. They had a lock on certain clients, whether it was leaders out of the Middle East or oligarchs in Russia, they got a lot of money coming in because they were Swiss. They had a great franchise, and they really lived off their private banking business. And in their investment banking business, they had a guy who was very talented, very smart named Allen Wheat and they had other people that come in. But everyone was running it for their own return into their own pocket. And so when I got there, I cut commissions. I got Frank and his guys to give up some of their money. And someone said, you know, we’re cutting commissions and getting less. Will you give up your contract? And I did. So it just wasn’t being managed. And the Swiss, you know, they make a lot of money because they get money from all the places that maybe JPMorgan and others wouldn’t take. They did a lot of investing with that money. They got to carry on some of it. It’s a great system for running a very profitable business. But the world was changing, and disclosure was becoming more and more open. People want to know, you know, who has the money, where’s it going, how’s money being transferred. And we finally got that to start moving and changing in Switzerland. And I was pretty tough on them. And of course, they thought I was the most arrogant person they ever met, and I thought they were the dumbest people I’ve ever met so — RITHOLTZ: In the book, you described actually saying that to their face. MACK: I did. RITHOLTZ: Given how secretive they are and how less than team focus they were, you knew this match wasn’t going to last forever. How long did you last at Credit Suisse? MACK: I think I lasted at least two years, maybe three. RITHOLTZ: Long enough to start showing a profit in the firm. MACK: Oh, yeah. We started making money. It was great. I mean, I remember the Olayan Group out of the Middle East said to me, and they were a huge investor in Credit Suisse, John, you’ve done a great job. We’re finally making money again. But I can’t take people telling me, you know, you don’t have access for this, you don’t have access for that. My view, which drove him crazy, was to open up their vault and let the European Jews come in and say how much money Credit Suisse took when World War II started. RITHOLTZ: Right. MACK: You know, how about the paintings they had? What’s a bank doing with a Renoir in a safe? RITHOLTZ: What was the response to that? MACK: They didn’t like it. RITHOLTZ: Yeah. I can imagine. MACK: Yeah. RITHOLTZ: So you ended up leaving Credit Suisse not long after. MACK: Well, they wouldn’t renew my contract. RITHOLTZ: Right. So it wasn’t like you were out and then fired. It was after your contract ended. MACK: No, I was fired. RITHOLTZ: So non-renewal and what was the firing like? Tell us a little bit about that. Was it relatively polite and pleasant? The Swiss, they’re not quite German, they’re not quite French, their customs are a little bit different than the rest of Europe. MACK: Well, when I went to Credit Suisse, they said that I could pick someone that I liked and trusted, a friend to go on the board. And I asked a guy named Tom Bell, who’s a close friend of mine, he used to run Y&R advertising agency, and then he ran Cousins Properties in Atlanta, to go on the board. Then he called me after their meeting and said, John, be prepared, they’re going to fire you tomorrow. I said, well, thanks for heads-up. So I went in, they fired me. And I sat and I said, you know, Walter, what do you think of this? Trying to get them to talk, but they didn’t want any part of talking. And look, you know, I don’t have any issue with the firm. I guess you could say I was aggressive or obnoxious, one or the other. But we turned the place around. RITHOLTZ: Right. MACK: We started making money. But, look, I don’t think in general, we have to ask my friends and people who know me. I don’t think I’m arrogant. But clearly, I came across as arrogant know-it-all. And they shot me so, you know — RITHOLTZ: But you had done a good job there. Let’s talk a bit about Mack the Knife, right? MACK: Right. RITHOLTZ: So there’s Chainsaw Al, there’s Neutron Jack. I don’t get the sense that you were as blase about having to reduce headcounts as some other CEOs were. MACK: Yeah. RITHOLTZ: It struck me that Mack the Knife sort of rankled you a little bit, at least that’s how it comes across in the book. MACK: Yeah. I didn’t mind it. I mean, being known as Mack the Knife, it kind of built a reputation for me. I’d go to a bar somewhere, I’d go to Christmas party with a lot of Wall Street guys, and invariably, someone would be pointing and says Mack the Knife. RITHOLTZ: Right. MACK: I have an ego. I like that. I am Mack the Knife. RITHOLTZ: That’s pretty good. So now, you get fired at Credit Suisse. MACK: Yeah. RITHOLTZ: And meanwhile, Morgan Stanley run by the somewhat risk averse, Phil Purcell, starts falling behind all their competitors. MACK: Right. RITHOLTZ: And lo and behold, there is an agitation to have some change — MACK: Right. RITHOLTZ: — at Morgan Stanley Dean Witter. Tell us what happens next. MACK: Well, I’m at Pequot which is a hedge fund with — RITHOLTZ: Art Samberg. MACK: — Art Samberg and having a good time. And Morgan Stanley is falling on. And then Parker Gilbert, who had been the chairman of the firm, and I think going all the way back, his stepfather was one of the original partners. And JPMorgan spun out and started Morgans — RITHOLTZ: Wasn’t he related to Henry Morgan also? I mean — MACK: That I don’t know. I don’t think so, but I don’t know that. Charles Morgan was related to Henry Morgan, who was not on the Management Committee, but there was a relationship going all the way back to the Morgans. So Parker got together with a number of retired partners who own a tremendous amount of Morgan Stanley/Dean Witter stock now. And they went on a campaign to force personnel out, and at the end of the day, they were successful. RITHOLTZ: And you get the phone call? MACK: Yeah. RITHOLTZ: You, again, briefly thought about it. What did your wife say to you? MACK: Well, she said I had to do it. She said, John, that firm is part of you and you’ve done so much. You got to go back and do this. RITHOLTZ: So that you return. MACK: Right. RITHOLTZ: Your first day of work, you walked into the trading room to deliver just, hey, I’m back. What is that experience like? MACK: Well, I think Christy, who’s my wife, would say, other than having our kids, it was the happiest moment of her life. She would say that, John, we grew up at Morgan Stanley. We knew the culture. And to come back, and to have people just running to get to the door to welcome us in, it was emotional. I guess a lot of it is just the circumstances. They hadn’t been managed the way I think they should have been managed. They didn’t have a connection with the leadership of the firm. They had become risk averse. And it was no longer, you know, the sense of you do well, you get rewarded. So the meritocracy thing had just dissipated away. So to walk in and have people scrambling to, you know, get to see me or — RITHOLTZ: Had it felt good? MACK: Yeah, it did. It did good. And I’ll never forget when I got up into the auditorium to talk to people and I said, you know, I always wanted to see all of you again, but I never thought I would see you by coming back in here, back to Morgan Stanley and doing it. But it was a thrill. I mean, you know, you don’t get many chances to redo, or recorrect, or change what had happened and go back the way it was. And we were able to do that, and it was a high. And you know, I get Christy and hear me. To her, as I said, other than the kids, that was the highlight of our marriage. So I got to work on it and do some other things. RITHOLTZ: And I mentioned when you first came in, and I’m sure you don’t remember this, the day you were brought in, you were doing a media tour. And I have a vivid recollection of sitting in a makeup chair in the greenroom at CNBC. MACK: CNBC. RITHOLTZ: And you and some other people blow in, hi, I’m John Mack. MACK: Right. RITHOLTZ: Hi. Nice to meet you. What was that about? I asked and someone said, oh, that’s John Mack. He just came back to run Morgan Stanley. I’m like, oh, isn’t that great? And that was, I don’t know, was it ’05? It’s like 15, 17 years ago? MACK: Yeah, something like that. Yes. RITHOLTZ: Yeah. Really, really fascinating. And you very quickly rebuilt the firm’s culture. Tell us what you did to bring back the one-firm firm — MACK: Sure. RITHOLTZ: — and the meritocracy. How did you get Morgan Stanley back on the straight and narrow again? MACK: Well, number one, you had to return it to meritocracy. And we had a lot of meetings either in big groups, small groups. Christy and I, one of the things we did early on, if there was a golf outing at Morgan Stanley with clients, if you went out, it’d be all men. And occasionally, there’d be one woman who played golf. So Christy and I said, well, let’s do things. I want women to be in charge of entertaining them than doing their own golf outings. So we got David Ledbetter and his guys come in, and we did golf lessons up in Purchase, New York for our women professionals. And then we took them down to North Carolina six or seven months later, at a club we belonged to called Landfall and we had, you know, the golf teachers come up and work with them. And the beauty of it is now the women have their own golf outing women-only, which I think is terrific. So what we tried to do is pull people together and talk about how do you make this a great firm again, because the roots are there, the bones are there. And it was about reaching out and bringing people together, and working for our clients and making sure that we treated people fairly. RITHOLTZ: So there’s a quote of yours in the book that I found fascinating. You wrote, certain risk-taking behavior multiplied exponentially when investment banks were converted from partnerships to publicly traded companies. I couldn’t agree more. MACK: Right. RITHOLTZ: Tell us your thoughts. MACK: Well, the thought was when it was a partner’s money, they were much more conservative. RITHOLTZ: They were literally joint in several liabilities, literally on the hook — MACK: Absolutely. RITHOLTZ: — if the firm lost money. That’s got to focus your attention. MACK: Oh, it does. And depending on where you were, which firm, but the culture, Morgan Stanley had been a pure investment bank, and they really didn’t have sales and trading either in equities or in fixed income. But what became apparent that firms like Salomon Brothers, were making huge inroads because Jackie Kugler at Salomon could call the CFO at IBM or AT&T and say, hear what pension funds are thinking and doing with your stock. We think there’s an opportunity you could float $100 million equity deal or bond deal. They had better information. And Morgan Stanley didn’t have that sales and trading business. We were not talking to portfolio managers as traders. We were talking to them as we’re pricing AT&T at 7-1As (ph). How many do you want? That’s the way it worked. But other firms, including Goldman Sachs, they were a two-way shop. They were buying and selling debt and equities with pension funds, and get a lot of information. What were they looking for? And what were they doing? And then you take that back and you show it to New Jersey Bell Telephone or you show it to, you know, AT&T or IBM. You’re bringing that CFO or that treasurer more information, so he can figure out what’s the next move for AT&T or Southern Bell? RITHOLTZ: So was it inevitable that these firms had to go public just so they had access to those pools of capital to expand into trading and underwriting and everything else? MACK: Yeah, because at the end of the day, the risk component went up dramatically. And you know, if you go through the crisis, probably if you were not a public company, you’d have wiped out the partnership. So you needed to have a strong base of capital and selling equity, and being in the public market gave you that. It also gave you the liquidity to go in the market to raise more equity if you need it, or do a bond do. RITHOLTZ: I used to think, hey, big mistake going from partnership to public — MACK: Right. RITHOLTZ: — because of the change in risk profile. But it sort of sounds like it was inevitable that all these partnerships would eventually go public. MACK: Yeah. Well, you know, what’s interesting, if you look at Lazard, they still do business. It was truncated. It’s not what it used to be. If you’re a CFO or a CEO, you want to know what are the hedge funds doing? State of California, State of New York, big pools of money in their pension funds, what are they thinking? What do they need? You want that kind of data. You want to know what are investors looking for? And I think, you know, if you look back, and it was difficult, we went through a hard time. The Dean Witter merger really changed the firm. Now, you had unbelievable banking, with the retail. And the amount of information that you could bring to a CEO or CFO about markets and then the distribution network you now had was a huge advantage. And I think that’s one of the reasons Morgan Stanley has done so well. RITHOLTZ: Really interesting. We’ll talk about books in a little while, but you seem to throughout your book, quote Ron Chernow’s House of Morgan a lot. MACK: Right. RITHOLTZ: How helpful was that in doing your research to write this? MACK: Well, I had read the book years ago, so I didn’t do a lot of work to dig down. So I would say very little. RITHOLTZ: Oh, really? MACK: Yeah. RITHOLTZ: Because he just goes berserk on the research side. MACK: That’s right. RITHOLTZ: Everything he does is so deeply and richly researched. MACK: He was never a bond salesman like me. RITHOLTZ: Well, you were actually on the inside, so it’s a little different. One of the other things you wrote was everybody got the financial crisis wrong. And in the run-up to it, people just didn’t expect the bottom draw (ph) out that much. Tell us a little bit about what took place with Morgan Stanley, leading up to the financial crisis? MACK: Well, number one, we had too much risk. There was no question about that. But we were not alone. And we did not have a fortress balance sheet like a JPMorgan would have or even a Citibank. You know, no one knows when the bullets come in, but the bullet came and shot a lot of us. And a lot of these companies either merged or went out of business. And all I can say is thank God for the Japanese and what they did. I mean, that was the lifesaver. They got us through. RITHOLTZ: Thank you, Mitsubishi with Morgan Stanley. MACK: Yeah. And as I said to you earlier, they remembered our culture because we would always have Japanese trainees. And they stood up, and that’s what saved us. RITHOLTZ: So you tell a story in the book, you have Hank Paulson, Ben Bernanke, and Tim Geithner coming to you to say, hey, you guys have to find a merger partner. MACK: Right. RITHOLTZ: And the response is we have $180 billion in capital. This is going to be a painful period, but we’ll survive. MACK: Right. RITHOLTZ: What was their response? MACK: They didn’t care. RITHOLTZ: Didn’t care? MACK: No. RITHOLTZ: Get more capital. MACK: Absolutely. RITHOLTZ: So you reach out to Bank of Mitsubishi. MACK: Right. RITHOLTZ: And you’re waiting for the term sheet to come in. MACK: Right. RITHOLTZ: And it’s midnight, and it’s 2:00, and it’s 4:00 a.m. It’s 6:00 a.m. And then Tim Geithner calls, and then Hank Paulson calls, and then a third time, Tim Geithner calls. What happens next? MACK: Well, what happens, the check flew in to Boston, and we had to send one of our bankers up to pick up the check and fly back. So he was at home. It’s over the weekend. And he went up in his dungarees and running shoes, and picked up a check for, I don’t know, a billion some, and brought it down. I got a copy of it framed in my office back at the townhouse. The Japanese saved us. They saved us because they remember our culture. And we used to train tons of Japanese bankers at Morgan Stanley. RITHOLTZ: So you’re waiting for the final word from Bank of Mitsubishi. MACK: Right. RITHOLTZ: I think you know where I’m going. MACK: Yeah. RITHOLTZ: And now, Geithner calls for the umpteenth time and your secretary pokes her head and then says, it was the head of New York Fed — MACK: Of New York Fed. Right. RITHOLTZ: — Tim Geithner and he’s insistent. MACK: Right. RITHOLTZ: And you basically said, we’re going to figure this out ourselves. MACK: Yeah. RITHOLTZ: And you did. MACK: And we did. Yeah. RITHOLTZ: And what’s your relationship with Tim now? MACK: I liked him. RITHOLTZ: Yeah. MACK: I mean, listen, to me, I hope it’s not personal to him. And the point was I’m trying to save the firm. I can’t take all these calls when I’m talking to the Japanese. So you know, we’re under the gun. He’s a decent guy. But he had his job to do and I had my job to do. And at the end of the day, it worked. RITHOLTZ: And in fact, the Treasury Department taps Morgan Stanley to help with the AIG bailout. MACK: Yeah, they did. RITHOLTZ: So that was a good working relationship. You actually had a good relationship with Hank Paulson — MACK: Yeah. RITHOLTZ: — from when he was CEO of Goldman. MACK: Yeah, he’s the best. Well, look, he’s honest. He’s smart. He’s straightforward. He gets things done. I have a lot of respect for Hank Paulson. RITHOLTZ: Before we get to our favorite questions, there were a couple of little curveballs I wanted to throw you. There’s a story in the book, you talked about somebody who you go to, who you know is a giant Duke basketball fan. And you asked him to give up part of his bonus, as you were doing. MACK: Right. RITHOLTZ: And very begrudgingly, he did it for the team. MACK: Right. RITHOLTZ: And then you get Coach K involved. Tell us that story. It’s charming. MACK: Well, he was a huge fan of Duke and I needed him onboard with what I was trying to do. And he gave up some power and money to accommodate me. And Mike Krzyzewski is a good friend of mine, a close friend of mine. So I called Coach K and I said, Mike, do me a favor. Will you call this gentleman and just tell him how much I appreciate what he’s done and that you are happy that you helped my friend John Mack out? So Mike calls the guy and he said, look, I want to tell you what you did is really something. John Mack is, he didn’t call me an a-hole, he said John Mack is a selfish tough guy, and what you did just warmed his heart. And I want to thank you because he’s my friend. The salesman was on cloud nine. RITHOLTZ: I can imagine. And then another curveball I got to ask you — MACK: Sure. RITHOLTZ: — you once stole Barton Biggs’ car. MACK: We hid it. His car was a dump. RITHOLTZ: Right. It was a clunker. He had a broken rear window. MACK: Yeah. RITHOLTZ: He just taped it off. He didn’t even replace the window. MACK: Yeah, we hid the car and he was like — RITHOLTZ: And then you had a make-believe sheriff from North Carolina call him? MACK: Right. Yeah. RITHOLTZ: And what was his reaction? MACK: Well, he laughed at the end, but he had no idea what was going on. And Bart is a wonderful man, but he is a good guy to pull pranks on. So what I’ve learned in pulling pranks — RITHOLTZ: Of which there are numerous examples in the book. MACK: But here’s what I’ve learned, though. When the prank is on you, laugh. Because everyone is trying to get me in one way or another. RITHOLTZ: Very, very funny. So we only have a few minutes left. MACK: Sure. RITHOLTZ: Let me jump to some of my favorite questions that we ask all of our guests. Tell us about your early mentors who helped to shape your career. MACK: Number one, Dick Fisher, just hands down. He would call me and say, look, John, you got to do this. I know you’re aggressive. You’re a great salesman. You can’t manage people and try to threaten them and scare them. You got to ease up. So he did that. Also, I could go to him if I had a problem, a question. So he was without question, my best mentor. And the other person is not that she mentored me, she’s my wife. She’ll say, John, you know, you want to reach out to that person and you know their kid is sick. You got him into Children’s Hospital, the Morgan Stanley Children’s Hospital. So she’s been a wonderful partner in telling me, you know, you’re being a little too aggressive, back down. And I think she’s right, I have softened up. Yeah, I think I have softened up. And that’s another thing. Morgan Stanley got behind us and we built this Children’s Hospital, which the employees love. They go up there on the weekends, and they read stories to kids. RITHOLTZ: Wow. MACK: That’s how you build a culture, that you do things like that. And I’m trying to thank Frank Bennack who’s at Hearst Corporation. He said to me he thought that was the best sign of corporate philanthropy he’s ever seen. So if some time you’re up near New York Presbyterian Uptown, if you go into the Children’s Hospital, Morgan Stanley Children’s, you’ll see on the wall that Morgan Stanley gave a lot of money. And then you’ll see names of hedge funds and other clients, when they heard what we’re doing, they gave money. And you know, New York is huge. You got, you know, the Philadelphia Children’s Hospital. You got them in Boston. New York City didn’t have a standalone children’s hospital. And our employees will go up there now and read books to the kids on the weekend sometimes. RITHOLTZ: Wow. MACK: It is a wonderful thing we did. We’re really, really happy with it. RITHOLTZ: You should be very proud of that. You mentioned books. Let’s talk about some of your favorites and what are you reading currently. MACK: Well, actually, I just read my book again. My favorite book all-time is Gone with the Wind. Can you believe that? RITHOLTZ: That’s a big book, right? MACK: It is a big book. So I’m taking history of the south at Duke University. And one of the things you had to do, you had to read 50 pages every other day about a history or something with a sound. So I picked up Gone with the Wind. I didn’t put it down until I finished it. RITHOLTZ: Really? Wow. MACK: If you haven’t read it, you got to read it. RITHOLTZ: Seen the movie, never read the book. MACK: The book is awesome. RITHOLTZ: Really? MACK: It’s just awesome. So — RITHOLTZ: What sort of advice would you give to a recent college graduate who is interested in a career in finance or investing? MACK: Well, number one, you have to pursue it. You got to get in the door. Hopefully, you have a background that will help you. If your education, let’s say you’re a history major, I was a history major. If your education doesn’t put you naturally into that glide path, then take courses and get into that glide path. Go to school at night, get your MBA, that helps. But more importantly, figure out how do you get to know people within that company. Make sure your job you have now, you’ve performed well in it. And get to know people in the company and get introduced by them to the head of a division or department. But you can get in it. I mean, there’s a lot of ways to get in this business. And one way of doing it, go work for JPMorgan, their asset management business. Go work for a hedge fund. Go work for a lot of people who are in the business and learn kind of the day-to-day sales and training business. And if you want to be an M&A specialist, my advice is you need to have a degree in accounting or an MBA where you can really zero in and have the training that you need to do and do that. You can do that business. If you didn’t have any experience, if they give you a chance, my point is you got to give them enough information that they want to give you a chance. And the way you do that is do extra work, or work for a hedge fund, or work for, you know, whoever it may be and you’ll get that shot. RITHOLTZ: And our last question, what do you know about the world of investing today that you wish you knew 50 years or so ago, when you were first getting started? MACK: That great companies that you invest in, you should hold. And I always was looking for the profit and I made money on it. But some of these companies, well, take Apple Computer. RITHOLTZ: Perfect example. MACK: I’ll give you a great example. My son, 11 years old, Morgan Stanley takes Apple public. I buy him a computer. He says, dad, this is a great company, I want to buy stock in it. And he’s like 11 or 12 years old, and he buys shares on it. I think that small purchase is well worth over a couple million dollars when he did. RITHOLTZ: Wow. MACK: So he understood great companies and his father did. You hold them. He’s never sold a share. RITHOLTZ: Wow. MACK: And it’s just been a home run. So I believe — RITHOLTZ: Well, dad is a trader. The son is an investor. MACK: An investor. That’s right. A smart investor. So I believe you buy great companies and hold them, and that’s what we do now. We have a family office that helps me, we work with them. And we still meet and talk to a lot of investors. RITHOLTZ: Quite fascinating. John, thank you for being so generous with your time. We have been speaking with John Mack, former CEO of Morgan Stanley, and author of the fascinating book Up Close and All In: Life and Leadership Lessons really from a Wall Street Warrior. If you enjoy this conversation, well, be sure and check out any of our previous 500 we’ve done over the past eight or nine years. You can find those at iTunes, Spotify, YouTube, wherever you find your favorite podcasts. Sign up for my daily reading list at Follow me on Twitter @ritholtz. Check out all of the Bloomberg podcasts on Twitter at podcasts. I would be remiss if I did not thank the crack team that helps put these conversations together each week. Justin Milner is my audio engineer. Atika Valbrun is my project manager. Sean Russo is my head of Research. Paris Wald is my producer. I’m Barry Ritholtz. You’ve been listening to Masters in Business on Bloomberg Radio. END   ~~~     The post Transcript: John Mack appeared first on The Big Picture......»»

Category: blogSource: TheBigPictureJan 10th, 2023

I used ChatGPT for a day for searches instead of Google, and I found it scarily impressive

ChatGPT is a chatbot that relies upon artificial intelligence to generate text. Here's my take on using ChatGPT instead of Google for a day. ChatGPT, a AI chat bot, has gone viral in the past two weeks.NurPhoto/Getty Images ChatGPT is a chatbot that relies upon artificial intelligence to generate text. The bot writes essays, poems, and can even be used as a search engine. Here's my take on using ChatGPT instead of Google for a day. Technology's "next big thing" may have emerged last month. It's called ChatGPT, which is a chatbot developed by an artificial intelligence company OpenAI. The difference between ChatGPT and an average chatbot is that the former relies on an emerging technology called "generative" artificial intelligence (AI), which means it can produce its own content as opposed to just responding to existing content. Aside from the obvious applications — writing cover letters, poems, and jokes to impress your boss — ChatGPT can also serve as a search engine.That has been troubling news for search-engine king Google, which issued a "code red" on the potentially competitive technology in late December, with CEO Sundar Pichai redirecting certain teams to boost its focus on AI products, Insider reported. At the same time, concerns have emerged about ChatGPT's potential to spew out biased and misinformed content. Others have argued that the tool isn't as smart as people are making it out to be. As a lifelong Google user, I thought it prudent to see what life might look like if online search is indeed overtaken by this buzzy new chatbot.Here's what happened when I spent a day searching terms on ChatGPT.  On Christmas Day, I woke up around 9 a.m. I usually check the weather via an app on the iPhone. Instead, I turned to my new encyclopedia for the day and typed in "what is the weather today.""I'm sorry, but I am unable to provide current weather information as my training data only goes up until 2021." That's 1 point for Google. I then asked it for the weather on December 25, 2020 since that was in the applicable date range."I'm sorry, but I do not have access to historical weather data for specific dates. Is there anything else I may be able to help with?"I was home with my parents for the holiday, so I explained my project to them. My father, a chemical engineer, was intrigued. He suggested I ask it for the definition of an atom.ChatGPT's reply:"An atom is the basic unit of matter that makes up all chemical elements. Atoms are made up of a small, dense nucleus containing positively charged protons and neutral neutrons, surrounded by a cloud of negatively charged electrons. The number of protons in the nucleus determines the identity of the element, and the arrangement of the electrons around the nucleus determines the chemical and physical properties of the element. Atoms can bond together to form molecules, which are the building blocks of most substances, including living things. The study of atoms and their properties is known as atomic physics." My dad thought the answer was passable, worthy of a B+, in his books. There were certain words he thought were unnecessary. He suggested I ask it for the definition of osmosis."Osmosis is the movement of a solvent (such as water) through a semi-permeable membrane (a membrane that allows some substances to pass through but not others) from an area of low solute concentration (dilute solution) to an area of high solute concentration (concentrated solution) until the concentration of solute is equal on both sides of the membrane.In other words, osmosis is the process by which water moves through a membrane in order to balance the concentration of solutes on either side of the membrane. This process is important in many biological systems, as it allows cells to maintain a balance of water and solutes inside and outside the cell.For example, in plant cells, osmosis helps to regulate the amount of water inside the cell, which is important for maintaining the shape and turgor (the state of being swollen or turgid) of the cell. In animal cells, osmosis helps to maintain the proper balance of water and electrolytes (such as sodium and potassium ions) in the body, which is essential for proper functioning." This response got an A+ from him. I thought the answer was a bit long, but it saved me the time of skimming two or three Google searches on the topic. My next query was asking about what to have for breakfast."There are many options for a healthy breakfast. Some ideas include:Overnight oats: Combine rolled oats, yogurt, milk, and any desired toppings (such as fruit, nuts, or seeds) in a jar or container and let sit in the fridge overnight. In the morning, you'll have a creamy, tasty breakfast ready to go.Scrambled eggs: Scramble eggs in a pan with some diced vegetables, such as bell peppers and onions, for added nutrients. Serve with whole grain toast or a piece of fruit.Breakfast smoothie: Blend together your favorite frozen fruit, a scoop of protein powder, and some milk or yogurt for a quick and easy breakfast on the go.Whole grain waffles or pancakes: Top with fresh fruit and a drizzle of honey or maple syrup for a tasty treat.Breakfast burrito: Fill a whole grain tortilla with scrambled eggs, black beans, avocado, and any other desired toppings for a protein-packed breakfast.Remember to include a source of protein in your breakfast to help keep you full and satisfied throughout the morning." I was shocked. The suggestions were not only healthy, but easy to make. As a vegetarian, I was surprised to see they were all herbivore-friendly. My brother and I went for option 4. Then we asked ChatGPT what to do in West Bloomfield, Michigan, where my parents live."West Bloomfield, Michigan is a suburb of Detroit located in Oakland County. Some things to do in West Bloomfield include:Visit Marshbank Park, a popular spot for hiking, picnicking, and fishing.Play a round of golf at one of the area's many public or private golf courses.Explore the West Bloomfield Woods Nature Preserve, a 125-acre natural area featuring walking trails and a variety of wildlife.Take a stroll around Orchard Lake, a beautiful lake with a public beach and several parks.Check out the West Bloomfield Farmers Market, held on Sundays in the summer, for fresh produce and locally made goods.Go shopping at the Orchard Mall or one of the many other shopping centers in the area.Visit the West Bloomfield Family Aquatic Center, a popular spot for swimming and water play in the summer months.Catch a movie at the Emagine Entertainment theater.Enjoy a meal at one of the many local restaurants, ranging from casual to fine dining."By this point my skepticism was beginning to fade. ChatGPT's answers included activities I had never even heard of even though my parents had been living in West Bloomfield for years. I was curious to see what it would suggest for New York, where I normally live."New York City is a vibrant and exciting place with a wide variety of things to see and do. Some suggestions for activities in New York City include:Visit iconic landmarks such as the Statue of Liberty, Central Park, and the Empire State Building.Explore the city's many museums, such as the Metropolitan Museum of Art, the American Museum of Natural History, and the Museum of Modern Art.Take a stroll through one of the city's diverse neighborhoods, such as Chinatown, Little Italy, or Greenwich Village.Check out a Broadway show or a performance at one of the city's many theaters.Go shopping in some of the city's famous department stores or browse the unique offerings at local boutiques and markets.Enjoy a meal at one of the city's many restaurants, featuring cuisine from all over the world.Visit the High Line, an elevated park built on an abandoned railroad track.Take a trip to the top of the Rockefeller Center for a panoramic view of the city.Enjoy a sunset cruise around the island of Manhattan."These responses were a little less impressive as they seemed like suggestions from a generic guidebook. My brother, a senior in college who recently finished a class on Sufi art, suggested I ask about the "best Islamic artist.""It is difficult to determine the best Islamic artist as art is a subjective and personal matter, and what one person may consider the best may not be the same for someone else. Islamic art is a diverse and rich tradition that encompasses a wide range of styles and media, including calligraphy, miniature painting, ceramics, textiles, and architecture. Some notable Islamic artists include:Hassan Massoudy, an Iraqi-born artist known for his expressive calligraphy and fusion of traditional and modern styles.Mahmoud Farshchian, an Iranian master of traditional Persian miniature painting.Farid Belkahia, a Moroccan painter and sculptor who was a pioneer of modern Moroccan art.Mona Hatoum, a Palestinian artist who works in a variety of media, including sculpture, installation, and video.Kamal Boullata, a Palestinian painter and art historian who has written extensively about modern Arab art.It is important to note that the term "Islamic art" refers to art created by or for Muslims, and does not necessarily refer to art that depicts religious themes or motifs. The art of the Islamic world is diverse and reflects the wide range of cultures and societies within the Muslim world." ChatGPT was turning out to be more diplomatic than I expected. I tried something more controversial— what did it think of Elon Musk?"As an AI, I do not have personal opinions or feelings. I am programmed to provide objective and factual information to the best of my ability based on my training and knowledge.Elon Musk is a successful entrepreneur and CEO of several companies, including SpaceX and Tesla. He is known for his innovative ideas and his work on developing electric vehicles and reusable rockets. Some people have praised Musk for his efforts to advance technology and promote sustainability, while others have criticized him for his business practices and controversial statements." Impressively neutral. My mom, heading out to the grocery store, chimed in with a more practical question. What was the average gas mileage of a Mini Cooper?"The fuel efficiency of a Mini Cooper will depend on the specific model and year of the vehicle, as well as the type of fuel it uses. Here are the EPA-estimated fuel efficiency ratings for some popular Mini Cooper models:Mini Cooper Hardtop:Gasoline: 28 mpg city/38 mpg highway/32 mpg combinedDiesel: 36 mpg city/40 mpg highway/38 mpg combinedMini Cooper Convertible:Gasoline: 26 mpg city/34 mpg highway/29 mpg combinedDiesel: 35 mpg city/39 mpg highway/37 mpg combinedMini Cooper Clubman:Gasoline: 27 mpg city/35 mpg highway/30 mpg combinedDiesel: 35 mpg city/39 mpg highway/37 mpg combinedIt's important to note that these estimates are based on laboratory testing and may not reflect real-world driving conditions. Actual fuel efficiency can vary depending on factors such as driving habits, road conditions, and vehicle maintenance." As the day ended, my family debated the best movie to watch. Naturally, I posed the question to ChatGPT."It is difficult for me to provide a list of the top movies currently as my knowledge was cut-off in 2021 and I am not able to browse the internet to find current information. In general, the popularity of movies can vary widely and depend on a variety of factors, such as the quality of the film, the talent of the actors, and the marketing efforts of the studios. Some popular movies may be highly rated by critics and audiences, while others may be less well-received. It is always a good idea to read reviews or watch trailers before deciding to see a movie, to get a sense of whether it is likely to be something you will enjoy." Overall, my entire family was impressed by ChatGPT. I felt like it definitely saved me a few steps over using Google. Most of the answers it generated felt balanced yet informative.Read the original article on Business Insider.....»»

Category: personnelSource: nytDec 31st, 2022

Judge OKs $5 Million Suit Over $3.99 Movie Trailer Fraud

Judge OKs $5 Million Suit Over $3.99 Movie Trailer Fraud; Could Trailers for Motion Pictures Become The Next Tobacco? Lawsuit Over Movie Trailer Fraud WASHINGTON, D, C. (December 26, 2022) – A judge has upheld the validity of a lawsuit seeking $5 million in damages because plaintiffs were duped into renting a film for $3.99 […] Judge OKs $5 Million Suit Over $3.99 Movie Trailer Fraud; Could Trailers for Motion Pictures Become The Next Tobacco? Lawsuit Over Movie Trailer Fraud WASHINGTON, D, C. (December 26, 2022) – A judge has upheld the validity of a lawsuit seeking $5 million in damages because plaintiffs were duped into renting a film for $3.99 by an allegedly misleading trailer, after holding that the trailer itself – unlike the movie – was not protected by the First Amendment, notes public interest law professor John Banzhaf. if (typeof jQuery == 'undefined') { document.write(''); } .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get The Full Henry Singleton Series in PDF Get the entire 4-part series on Henry Singleton in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q3 2022 hedge fund letters, conferences and more   Although the door for such legal actions is opened just a bit with this ruling, it could mean that eventually movie trailers could become the next tobacco in terms of lucrative lawsuits, says Banzhaf, who has been called "The Law Professor Who Masterminded Litigation Against the Tobacco Industry," a "King of Class Action Law Suits," and "a Driving Force Behind the Lawsuits That Have Cost Tobacco Companies Billions of Dollars." Two fans of Ana De Armas sued Universal because the trailer for the firm "Yesterday," which included brief scenes which showed the actress, had been cut so she not longer appeared at all in the movie which each plaintiff had rented from Amazon for $3.99. The judge permitted the class action lawsuit for $5 million to proceed, ruling that, because the trailer was in the nature of an advertisement, it did not have the First Amendment protection which the movie itself would certainly enjoy. As judge Stephen Wilson wrote in his potentially very significant ruling: “Universal is correct that trailers involve some creativity and editorial discretion, but this creativity does not outweigh the commercial nature of a trailer. At its core, a trailer is an advertisement designed to sell a movie by providing consumers with a preview of the movie.” Therefore, he rules, the were classified as “commercial speech,” making them subject to California's tough and sweeping "False Advertising" and "Unfair Competition" laws. This ruling - that the trailer for a movie can be subject to the same false advertising and unfair competition claims as any other product - could have widespread implications, suggest Banzhaf. Although here the misrepresentation is clear and not at all subjective - i.e., the trailer did in fact depict an actress who did not in fact appear in the movie - the ruling opens the door to broader and less objective claims that a movie trailer was deceptive because it unfairly misrepresented the movie itself. In fact, exactly such a lawsuit was filed back in 2011, and was still being litigated in 2017. It involved the movie "Drive." Plaintiff alleged that the trailer was deceptive because it led her to believe that there would be lots of fast-driving action scenes - more like the movie "The Fast and the Furious" - than it actually contained. As the court opinion described it: "[Plaintiff] first asserts that Drive’s … advertising falsely promoted it as 'a chase, race, or high speed action driving film,' similar to The Fast and the Furious and that the preview failed to reveal that the film includes 'many segments of slow paced, interpersonal drama.” Although in Drive, the judge concluded that the trailer was not deceptive because the movie contained enough action driving scenes, other judges in cases involving other movies could well conclude that, despite what was suggested by the trailer, the movie in question did not contain enough "high speed action driving" scenes - or romantic scenes, or terrifying scenes, or whatever the trailer allegedly promised. The door for such law suits is opened even further by two other factors, suggests the law professor. Since it has long been the law that ads on television and elsewhere directed to children were to be judged by a kid's (and not an adult) standard - since what might be clear to an adult might nevertheless be misleading to a 6 or 8 or 10 or even 12-year old child - parents could sue if a child claimed that the ad he saw was misleading about the actual movie. Such suits might be both easy and lucrative for any lawyers who have small children, observes Banzhaf. The standard of what might be misleading to a child is obviously very low because of their vivid imaginations and relative lack of sophistication, with many still believing in Santa Clause, that there might be monsters under their beds or in their closets, that a tooth fairy visits, or that they have invisible friends, etc. Another possible option for attorneys eager to cash in on such law suits would be to claim that a movie trailer failed to disclose and/or to put viewers on notice that the movie itself contained large amounts of anti-Semitic (or racist, sexist, misogynistic, homophobic, or other objectionable) content. Indeed, this has already begun happening. In the Drive litigation. the court wrote that "plaintiff asserts … that the movie Drive 'used extreme gratuitous defamatory dehumanizing racism to depict members of the Jewish faith, and thereby promoted criminal violence against members of the Jewish faith' and that the trailer was misleading as it excluded any reference to the film’s anti-Semitic nature." Water For Elephant In another lawsuit brought several years later, a plaintiff charged that the movie "Water For Elephant" contained hidden anti-Semitic messages, including subliminal messages that promote hatred of Jews. Such law suits might have a better chance of succeeding today than in earlier years for at least two reasons, argues the law professor. First, there is a growing concern about and demand for so-called "trigger warnings"; defined as statements made prior to sharing potentially disturbing content in plays, movies, and even in college lectures. While once deemed necessary only for extreme content such as for nudity or strobe lights (which could trigger seizures), today such warnings are increasingly being demanded for topics as diverse as homophobia or transphobia, rape and other forms of sexual violence, child abuse, violence, incest, animal abuse or death, racism, self-harm, etc.; with those who insist on the warnings claiming that a failure to include them can have devastating consequences. Second, there are ever growing reports about both discrimination against and violence directed towards Jews, Asians, LGBTQ+ members, and other groups, so that a failure to disclose in a trailer that the film contains messages which might arguable encourage such behavior could become legally actionable. In other words, since the First Amendment appears to prevent law suits directly against movies which allegedly promote such themes, a workaround might be to sue if the trailer (which is only an ad which does not enjoy such protection) fails to disclose such content, says Banzhaf. A failure to disclose in an ad a factor which might be of concern to a viewer can create legal liability, says Banzhaf, noting a law suit he initiated against McDonald's over a claim for its french fries. Although the claim was truthful, Banzhaf argued that McDonald's failure to disclose another relevant fact in its ads made it unfair and deceptive, and therefore illegal. Unwilling to risk a trial, McDonald's paid over twelve million dollars to settle the lawsuit, changed the ad to include the previously omitted fact, and even published an apology. Similarly, movie studios might be reluctant to go to trial in lawsuits seeking millions of dollars over claims that a trailer was deceptive, failed to include a trigger warning, was deceptive to a young child (even if not to an adult), or was deceptive because it omitted a key detail, suggests Prof Banzhaf......»»

Category: blogSource: valuewalkDec 26th, 2022

Movie fans can sue film studios if they release misleading trailers, judge rules in Ana de Armas suit

Judge Wilson rejected Universal's bid to dismiss the lawsuit brought by two Ana de Armas fans and said trailers were subject to advertising laws. Ana de Armas appeared in the trailer for the 2019 film Yesterday, but her character did not make the final cut.Jeff Spicer/Getty Images A federal judge rejected Universal Studios' motion to dismiss a lawsuit claiming it misled fans. Movie fans filed a class action suit in January claiming they were tricked into watching the film. They sued Universal because actress Ana de Armas was in the trailer, but didn't appear in the movie. Movie fans will be able to sue studios under false advertising laws if they release misleading trailers for forthcoming releases, a federal judge ruled this week.The news was first reported by Variety. The trailer for Danny Boyle's 2019 feature "Yesterday" may be considered as false advertising because it included actress Ana de Armas, who did not actually appear in the film, according to a court filing on Tuesday. A California district court judge, Stephen V. Wilson, is letting a class action suit filed earlier this year proceed after Universal Studios asked for it be dismissed. Universal argued that it would "open the floodgates" to others who felt they had been misled by trailers. Judge Wilson rejected Universal's argument and ruled that the trailers were subject to advertising laws: "At its core, a trailer is an advertisement designed to sell a movie by providing consumers with a preview of the movie." Two Ana de Armas fans brought the lawsuit against Universal in January after they paid $3.99 to rent the rom-com online to find that the "No Time to Die" actress didn't appear in the film. At least $5m is being claimed on behalf of the fans in the lawsuit.The fans, Peter Michael Rosza and Conor Woulfe, argued that they were tricked into watching "Yesterday" after they saw Armas in the trailer. The complaint said Universal was "unable to rely on fame of the actors playing Jack Malik or Ellie to maximize ticket and movie sales and rentals," and therefore "used Ms. De Armas's fame, radiance and brilliance to promote the film by including her scenes in the movie trailers."Judge Wilson said that the moviegoers were not given "any value for their rental or purchase", per the filing, and lawyers will meet again for the case in April. Universal did not immediately respond to a request for comment from Insider.Read the original article on Business Insider.....»»

Category: worldSource: nytDec 24th, 2022

The Next Energy Boom is Here: How to Invest Today

Trillions of dollars are currently flowing into alternative energy technologies, which will continue for decades to come. Ben Rains can help you get involved in tomorrow's energy titans today with stocks focused on wind, solar, nuclear and more. The discovery of fossil fuels helped transform the world into a rich, abundant place full of constant innovation and technological advancement, making companies immensely profitable in the process. We now sit on the edge of the next energy revolution that’s poised to see alternative energy companies evolve into the Wall Street titans of tomorrow.Building a future beyond only fossil fuels is no longer a niche effort of the environmentally conscious. Renewables are firmly embedded into the energy landscape in the U.S. and around the rich world. Even OPEC nations who have oil to thank for their wealth, such as the United Arab Emirates, are spending billions on clean energy projects, including wind and solar.Elsewhere, the Amazons and JPMorgans of the world are each shelling out billions of dollars to fund alternative energy projects right now, with far more money to come down the road.Fueled by a mixture of government incentives and market forces, trillions of dollars are currently flowing into alternative energy technology, research, and innovation—and likely will for decades.Current State of the Alternative Energy Market Hydroelectric was the only large-scale renewable energy source in the U.S. and around the world until relatively recently. Modern industrial wind turbines didn’t start popping up in droves until the early 2000s.Solar is far newer to the scene. In fact, the highly-publicized and currently viable clean energy source didn’t gain real traction until the mid-2010s. The expansion of wind and solar helped renewables expand their share of the U.S. electricity generation mix from 10% in 2010—when it was mostly from hydroelectric—to 20% last year.When we include nuclear as part of the non-fossil fuel energy mix, alternative energy makes up 40% of the U.S. electricity mix. Meanwhile, renewables and nuclear account for roughly 20% of total U.S. primary energy consumption, which is far different than just electricity, compared to 11% for coal, 32% for natural gas, and 36% for petroleum.Plenty More Upside Various projections, including those from the U.S. Energy Information Administration, see renewables continuing their rapid expansion in the coming years and decades. The EIA projects that renewables will double their share of the U.S. electricity generation mix by 2050.Continued . . .------------------------------------------------------------------------------------------------------Profit from the Red-Hot Future of Energy – Today It’s no surprise that energy stocks are the most promising stock in the market now. The Energy sector has soared +57% YTD, with leading stocks soaring well into triple-digit territory.Zacks Alternative Energy Innovators focuses on the subgroup with the most thrilling upside. Trillions in R&D, incentives, and investments are already pouring into solar... hydrogen fuel cells... next-gen nuclear... and more. Clean energy is now a strategic priority for virtually every nation on earth. Don't miss Zacks top stocks in this space. Deadline for entry is Monday, December 26.See Our Hottest Energy Stocks Now >> ------------------------------------------------------------------------------------------------------On top of that, nuclear is poised to awake from hibernation, having steadily accounted for 20% of U.S. electricity since the early 1990s. The energy market turmoil of 2022 has forced many countries in Europe and around the world to push for greater energy independence.Many of these same nations are trying to reach self-imposed emissions goals, and are quickly coming to realize that renewed investment in nuclear must play a far more significant role going forward.Alongside the ample runway ahead for solar and wind and the second life for nuclear, Wall Street is searching high and low for the best and brightest names in battery storage technologies, hydrogen fuel cells, tidal energy, and the still-theoretical.Reimagining the Stagnant Giant The first big wave of nuclear power plants came online well over 50 years ago. Dozens of companies are now hard at work on the next generation of nuclear power. The physicists and engineers of today are attempting to downsize and mass produce nuclear power plants.Next-generation nuclear is focused on small modular reactors or SMRs. The goal is to create high-tech, smaller, less costly reactors that can be built far more quickly and deployed in far more places.Meanwhile, more money than ever is being invested in fusion research. Nuclear energy is currently created through fission, or splitting heavy atoms.Fusion, or melding lighter atoms, is the same process that powers the sun and stars. Firms able to produce fusion with abundant elements would likely be the superstars of energy and possibly all of Wall Street.Fusion is often called a fantasy. But remember that not too long before the atom was first split, many of the brightest minds on Earth said it would never be done. Hydrogen Potential Hydrogen is set to become a crucial component in the clean energy mix through the use of fuel cell technology. Some industry experts and scientists see hydrogen, which can be in practically endless supply, as one of the biggest players in a cleaner energy future, especially when it comes to transportation.Hydrogen-based technology is already used to power some vehicles, from your local public bus to forklifts in factories. These vehicles nearly all utilize fuel cell technology. Hydrogen fuel cells can be thought of along the same lines as EV batteries, though, a more apt comparison might be mini power stations.Just The Start Despite the quick rise to Wall Street prominence, coupled with the current viability of technology such as wind and solar, there is no end in sight when it comes to the runway still ahead. The broader alternative, non-fossil fuel industry still only accounts for a small portion of global energy generation.Investors have tons of opportunities to turn substantial profits in areas such as solar, where many companies are producing 60% year-over-year revenue growth right now. On top of that, the upstart pockets of the alternative energy ecosystem offer seemingly endless growth potential.Crucially, the money is there to support a future that might look more like something out of a science fiction movie than anything close to the current energy industry. Think of it this way:  alternative energy already accounts for 75% of the growth in overall global energy investment that’s measured not in billions but in trillions of dollars.Why Wait To Get Aboard?Renewable energy’s future holds so much potential that Zacks’ newest portfolio service is specifically dedicated to finding the most promising stocks in the industry.You’re invited look into the exclusive recommendations and commentary of Alternative Energy Innovators.Energy has been the best performing sector since 2021, and I believe that trend will stay in place in the new year and beyond. 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Category: topSource: zacksDec 21st, 2022

Transcript: Albert Wenger

     The transcript from this week’s, MiB: Albert Wenger, Union Square Ventures, is below. You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Stitcher, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here. ~~~ ANNOUNCER: This is Masters in… Read More The post Transcript: Albert Wenger appeared first on The Big Picture.      The transcript from this week’s, MiB: Albert Wenger, Union Square Ventures, is below. You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Stitcher, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here. ~~~ ANNOUNCER: This is Masters in Business with Barry Ritholtz on Bloomberg Radio. BARRY RITHOLTZ, HOST, MASTERS IN BUSINESS: This week on the podcast, what can I say, I have yet another extra special guest, Albert Wenger, managing partner at Union Square Ventures. He has a fascinating background in technology and software, and is interested in all sorts of interesting things, ranging from climate change to humanism, to the huge transitions that humans have gone through as a species and what it means to society, investing, scarcity and just the quality of life that we will enjoy as a species. I found this conversation to be really intriguing. If you’re interested in venture capital, in technology, in how to think about early stage investing, well, strap yourself in, this is a great one. With no further ado, my conversation with Union Square Ventures’ Albert Wenger. You have quite a fascinating history. Let’s delve into that, starting with your background. You won a national German competition in computer science in high school. Tell us about that and where that led you. ALBERT WENGER, MANAGING DIRECTOR, UNION SQUARE VENTURES: Well, I fell in love with computers very early on when I was a young teenager. And my parents were super indulgent of this at a time when that was very unusual, and they bought me an early Apple II computer, one of the earliest Apple IIs to be sold in Europe, actually. And I’ve stuck with that, my entire life. I’ve studied computer science as an undergrad and as a graduate student. And I’ve been investing in a lot of computer companies over the years. So it’s been a central to what I do and who I am. RITHOLTZ: So let’s talk about the timing of school. You graduate Harvard in 1990, with an Economics and Computer Science degree, perfect for the explosion of the Internet; a PhD from MIT and Information Technology in ‘96. So when you were leaving school, were you interested in the Internet, or was it more hardware and software? WENGER: No. The web was really exploding while I was at MIT. And I actually finished my PhD in ’99, but I started a company in late ‘96, early ‘97. And I was kind of doing the company and the thesis at the same time, which wasn’t great for either, and also wasn’t great for our marriage. We kind of managed to get through that. But I was really fascinated with the web from when I first discovered it, which was in a computer lab at MIT where I’m trying to do my stats homework. So — RITHOLTZ: So let’s talk a little bit about some of the other companies you either founded or run, the most famous is probably, which ended up getting picked up by Yahoo. Tell us a little bit about — WENGER: It was an early Web 2.0 darling, Joshua Schachter had started. He was working at Morgan Stanley actually full time. He had started this as a side project. And it was kind of this idea that you would share your bookmarks with others, because bookmarks were kind of an indication of something that was actually interesting on the Internet. And Joshua added tags to that, and so you could browse things by tags. And at that time, Union Square Ventures’ Fred and Brad had started the firm, they had just raised the first fund. I had just finished another project I was been working on. And they were like, “Hey, we’re talking to this guy, Joshua, what do you think?” So I met up with Joshua, and they wound up investing, and I wound up to become the president. RITHOLTZ: So you’re president of, you see it through in order to be acquired by Yahoo in the early 2000s. Tell us a little bit about that experience. WENGER: The team was tiny. It was sub 10 people, basically. RITHOLTZ: Wow. WENGER: And it was a very rapidly growing service. I made myself sufficiently unpopular during the acquisition because I insisted on certain things, I’m like, “We’re not doing this. We’re not doing this. We’re not doing this.” At they at the end, they were like, “We want all of you except for this Wenger guy. We don’t want him,” which was perfect for me, mind you, because I didn’t want to relocate out to the West Coast. So I got to just take my marbles and start making angel investments. RITHOLTZ: So is that what led you to Etsy and Tumblr was the acquisition? WENGER: Yeah, exactly. I had a little bit of money and I met Rob Kalin, the founder of Etsy. He had just come back from the West Coast. He had tried to raise money on the West Coast, was unsuccessful with that. And so I wrote an angel check here, and then I brought Union Square Ventures in as the first Series A investor. RITHOLTZ: Is that what led to your transition from entrepreneur to venture capital? WENGER: Well, I was basically hanging out at the USV offices after the sale of and — RITHOLTZ: Just because you had no place else to go. WENGER: Because I knew both Brad and Fred really well, and so it was kind of a natural thing to do. I did these angel investments. I led the Union Square Ventures investment in Etsy, I became a venture partner for that, and then became a GP in the 2008 fund. RITHOLTZ: So Etsy, also Tumblr was another one. And if memory serves, were they acquired by Yahoo? WENGER: They were also acquired by Yahoo. Yes. RITHOLTZ: Okay. So you’re working at a contact list. What was that experience like now not as a president, but as an outside investor? WENGER: It was a very, very lucky landing for Tumblr, because Yahoo really was the only bidder and they were bidding against themselves, but they didn’t really know that. RITHOLTZ: So what eventually led you to say, “You know, I think I could do this venture stuff full time. Let me hang my hat at Union Square Ventures and focus solely on something else.” WENGER: Yeah, that had really been my goal since my own first startup in ’96, ‘97, which was a company called W3Health that ultimately failed. From that experience, I realized that I really loved startups, but then I was never going to be good operator, but I thought I could maybe be a decent investor. RITHOLTZ: Let me make a digression here, and since you’re in front of me, I have to ask this question. So I deal with traders, investors, fund managers, economists down the list, there is no group of people that seem to be prouder of their failures than venture capitalists. Why is that? WENGER: Because it’s an integral part of the business. And if you can’t deal with failure, you can’t be a VOICE, because many of the startups you invest in fail. RITHOLTZ: Statistically, that’s your expectation? WENGER: Yes, absolutely. RITHOLTZ: So it just seems like the healthiest way to think about what is unavoidable, yet so many people within the world of finance, kind of dance around it, try not to deal with it. There’s a little bit of denial. It’s almost like an object of pride, “Look, here are all the companies we invested in that didn’t make it. Look, here are all the great companies we passed on.” It’s almost like a point of pride, this sort of self-awareness. WENGER: Well, it’s also important too, how the venture capital model works overall, right? So the most you can ever lose in venture capital is the amount of equity you’ve put in. RITHOLTZ: Right. WENGER: But the upside is nearly limitless. I mean, it’s what Nassim Taleb calls convex tinkering, right? It’s the perfect example of that. You take many small, relatively small positions, and any one of them can become very, very large. But you also learn a lot from the things that don’t work. You know, sometimes you learn a lot more from that than you learn from the ones that do succeed. RITHOLTZ: Sure. You tend to learn more from losers than winners usually. And then I have to ask the same question, so Union Square Ventures, by definition Union Square is here in New York City. What’s it like being a venture investor on this side of the country, as opposed to what seems to be, you know, the gravitational black hole of venture out in Silicon Valley in California? WENGER: Well, first of all, it’s no longer that. So you know, Sequoia just opened a New York City office. Andreessen Horowitz has people on the ground here. So New York City is now, today, one of the epicenters. When we started, that wasn’t the case. When we started, people were like, “Oh, there’s been no tech company in New York City. There’s been no IPO.” Of course, you know, we were involved with two of the major IPOs. We led the Series A in Etsy. I also led the Series A — we — Union Square Ventures led the Series A in MongoDB, the big New York City-based success story. So it was incredibly healthy, though, because we were never caught up in the “Oh my God FOMO” of we have to have one of these and one of those, and everybody else is investing in the sector. It was always a “Let’s form our own thesis. Let’s figure out what we believe, and then let’s find companies that fit with that.” And we’ve always been extremely competitive in winning deals in the West Coast. In Twilio, I led the Series A, for Union Square Ventures, and there was a, you know, San Francisco-based company. So — RITHOLTZ: Last question on this topic, how different is venture in New York versus California, or is there really no big difference? WENGER: There used to be a noticeable difference between East Coast and West Coast. Today, I think that’s completely erased. RITHOLTZ: Quite interesting. So let’s talk about the thesis-driven venture capital firm, which is how USV describes itself. Tell us what these theses are and how do they drive your investment? WENGER: Yeah. So there’s been an evolution over time. I would say, you know, what we call Thesis 1.0 was that we invest in large networks of engaged users, differentiated by user experience, and those were investments like Twitter and Tumblr. And then we started to focus on companies that had less obvious network effects, so more data behind the scenes, companies like Sift, for example. And then we added to our thesis sort of infrastructure, and infrastructure investments included Twilio and MongoDB, Cloudflare. Stripe. There’s a whole bunch of infrastructure investments, infrastructures for building digital businesses. Our current iteration, what we call Thesis 3.0 is about broadening access to knowledge, capital and well-being by leveraging existing networks and protocols, and building trusted brands. And each part of that thesis actually means something very concrete. So let me just pick one of them, building trusted brands. For us, a lot today is about is your business model fundamentally aligned with your customer or not? The advertising model, as we have learned is not aligned with customers’ interests, right? If you’re YouTube, you want to serve the most engaging video so that you can show more ads. You don’t want to serve the most appropriate video, right? But if you have a subscription model, let’s say like Netflix, you want to show something that somebody actually really truly deeply is going to relate to, so that they stay as subscriber long term. So each part of this thesis means something and we use the sort of high level thesis to then look for very concrete things. So for example, I said broadening access to capital, so we’ve done a lot in lending, like, how can we do better underwriting, better, cheaper, faster loans, for instance, to small businesses, investment, like a company like Funding Circle, or to individuals, like a company like Upgrade, in a way that actually helps people, so where you’re not dragging them into like a debt hole, but you’re actually helping them build up their credit score while you’re giving them — extending their credit. RITHOLTZ: So 3.0 sounds a lot like World After Capital, I’m hearing some very similar themes. WENGER: Absolutely. There’s a strong relationship between some of the ideas in the book and some of the ideas that inform our investing. RITHOLTZ: We’ll circle back to the book in a little bit. Let’s talk about a couple of companies you invested in because I’m picking up a theme there, Meatable, Terra, Living Carbon, Marvel Fusion, Legendary Food, climate sustainability impact investing. WENGER: Yeah. So those are all personal investments, not Union Square Ventures investments. But I made those investments in the run up to us forming a climate thesis, and now a Climate Fund. So those are all investments that go back a few years, when I sort of became really interested in what kind of opportunities come out of the climate crisis. The climate crisis, if we don’t get on top of it, none of the other stuff will matter. None of the money we’ve made will matter. It’s so big. It’s so much bigger than COVID, for example, in ways that I think people still don’t appreciate. And so I made some personal investments first, and then we started talking to our LPs about it. And then during COVID, we raised the first Climate Fund, $160 million Climate Fund. We’re almost done investing that. And so the climate thesis is very simple. We want to invest in companies that either reduce emissions, draw down existing emissions, or help with adaptation. So I’ll give an example of an adaptation investment. We invested in a company out of Australia called FloodMapp. And what they do is they predict where things are going to flood. They also measure the actual flooding. Floods are one of the biggest problems coming out of the climate crisis, and they’re here today. This is not some future problem. And mega floods in Pakistan, a third of Pakistan is underwater as we speak. I don’t think people understand how horrific the devastation there is. RITHOLTZ: It’s the other side of the droughts that are everywhere. It’s what’s dry gets drier, what’s wet gets wetter. WENGER: Absolutely. Talking about emissions reductions, we’ve made investments, for example, in our first ever investment in Africa, in a company called Shift EV. What Shift EV does is it takes existing delivery vans and retrofits them in a space of a couple of hours, from internal combustion engine to electric. RITHOLTZ: A couple of hours? WENGER: A couple of hours. Yes. RITHOLTZ: Because if you want to take an old 911 and convert it to EV, it will take you about a year, assuming if you can get on the list. It’s that backed up for that shift itself. WENGER: So they have completely industrialized this process. RITHOLTZ: That’s amazing. WENGER: You drive a minivan in and a couple of hours later, drives out as an EV. RITHOLTZ: Wow. What do they do with the internal combustion engine and — WENGER: That’s a great question. I need to ask Ellie what they do with that. I don’t know. RITHOLTZ: I mean, it seems like that’s a lot of hardware to just throw away. WENGER: I don’t know. Great question. RITHOLTZ: Really interesting. WENGER: And then I’ll talk about one of the drawdown investments. We’ve invested in a company called Brilliant Planet out of the U.K. What they do is they build ponds in the desert and they pump seawater in, and then they grow algae very, very rapidly, continues algae bloom, and it takes a huge amount of carbon out of the atmosphere. RITHOLTZ: Algae in ponds — WENGER: In the desert. RITHOLTZ: — can move the needle? WENGER: Yes. Absolutely. RITHOLTZ: That’s quite fascinating. Two questions come out of this, one is structural and one is fund based. Let’s do the fund one first. So John Doerr had a climate fund started about 10 years ago at Kleiner Perkins. Some people have said it kind of lagged other similar era venture funds. Was he just early? How do you look at this in terms of not just having a positive impact on the planet but generating a return on investment? WENGER: Yeah. The early green tech funds, they were too early in one sense. But in another sense, they were actually crucial to our having a shot at overcoming the climate crisis. Because if it hadn’t been for the investments, we wouldn’t have gotten on the cost curve, for instance, for solar PV, right? So the reason we have really cheap PV today, the reason we have really relatively cheap batteries today is because of some of the investments that were made back there. And there’s this pattern in the world where every big technological shift starts with a bubble, right? RITHOLTZ: Right. WENGER: So when we had ships, we had the South Sea bubble, right? And when we had railroads, we had the railroad bubble. There was an automotive bubble. There was dot-com bubble, multiple bubbles in crypto. There was a green tech bubble. But, now, it’s a decade-plus later and all the things that they were rightly concerned about are all coming true. And we are now reaping some of the benefit, but we’re also now building on — we’re sort of standing on the shoulders of giants, as it were. RITHOLTZ: And to clarify, I believe that fund doubled over 7 or 10 years, not like it was a sinkhole, but compared to what it could have done, had that money been invested elsewhere, it might have seen better returns. But it wasn’t — I don’t want to make it sound like it was total loss. So the second question is, you’re making seed investments, how does that work if you want to bring one of those seeds to your firm, to Union Square Ventures? And from a public market, that sounds like it’s a compliance and conflict nightmare. You guys approach it differently. WENGER: In our LPA, we can write checks up to $100,000. So we can’t make massive investments in startups. So all of the companies you mentioned have a sub $100,000 investment. And then the only one where I’ve invested more is Marvel Fusion. We can invest more once the fund has passed on something. So if the fund says we’re not doing this, then we can invest. RITHOLTZ: Got it. Interesting. So along those lines, there are some venture firms that don’t really seem to care a lot about valuations and others seem to focus on a little bit. How do you fall in that spectrum? Is valuation significant, or is it, hey, we’re going to make 100 investments and if two or three workout, the valuations are irrelevant? WENGER: No, we’ve definitely always been disciplined on valuation, and we’ve let a number of things go. Sometimes we let them go and they do great, like, “Well, we could have made money if we had invested.” And sometimes you’re very happy at that. Our approach is we’ve always kept our fund sizes small, so we don’t need to be in everything that’s out there. Our latest funds are — our core fund is $250 million. So these aren’t big funds in the scheme of things when you have other firms that raised $3 billion. $8 billion, $15 billion per fund. And as a result, if we think the price is too high, we can just find something else. RITHOLTZ: So let’s talk a little bit about some of those bigger funds, and I guess we’ll hold Softbank off to the side because that was really aberrational. But do you end up when you have lots of $10 billion and $20 billion venture funds, with too much capital chasing to a few good deals? How does this impact the whole ecosystem that’s out there? WENGER: Largely, it’s great for us because we’re early stage investors. So it means there’s lots of money to come in and fund later rounds of the companies we’ve invested in. So we haven’t really spent much of our time worrying about it. And then every once in a while, these firms go. We’re going to go really early and some of them do spread money early. But we find, because we’re thesis-driven and because we are opinionated, on deals that we’re really interested in, we can win those deals. Sometimes they’ll take a small check from somebody else along for the ride, but they know that we work with early stage companies that we roll our sleeves up, that we’re involved, and that we have a thesis. And you know, we take the approach we’d rather disagree with the founder and then not invest than sort of like — be like, “Oh, well, whatever it is you want to do.” Like, we have a thesis as to why we think this is interesting. Let’s talk about this. If it’s aligned, great. And obviously things may change after we’ve invested. We’re not like stubborn, you know. But let’s talk about why we are excited. And if that aligns with you, that’s great. If it doesn’t, let’s go separate ways, right? So we take a kind of — I call it a high alpha approach investing. We’d rather have really upfront conversations about what we like and don’t like than sort of get married as it were. And actually, it’s harder to get rid of VC than it is to get a divorce. So like we think it’s good to have these conversations up front, right? RITHOLTZ: What about follow-up rounds, or some firms that will do a seed round, and then participate in an A or B round? Is that something that Union Square does? WENGER: Well, we reserve a lot of funds for follow-on, and we have a very sort of, I think, sophisticated reserves methodology that we’ve honed over many funds cycles now, where we actually built kind of a Monte Carlo analysis of the portfolio to see how much money we think we need to keep in reserve. But eventually, when the valuations get too high, the rounds get too large, we don’t follow on. We have a separate vehicle called the Opportunity Fund, where we sometimes write bigger checks into late-stage rounds in some of our portfolio companies, but not always. RITHOLTZ: So let’s talk a little bit about this book, “The World After Capital,” starting with what is technological nonlinearity? I liked that phrase. WENGER: The basic idea is that every once in a while in humanity’s history, we invent things that radically change what we, as society, have as a binding constraint on us. So let me make that very concrete. For hundreds of thousands of years, our ancestors were foragers. They were hunter-gatherers. They would go out and find things, and eat berries and kill little squirrels. And then roughly 10,000 years ago, we had a bunch of inventions. We figured out that you could plant seeds, that you could irrigate them, that you could domesticate animals, that you could use the dung from the animals too as a fertilizer. We figured all those things out and we got agriculture. And the constraint shifted from how much food can you find to how much land — arable land do you have. And when that constraint shifted, we changed just about everything, about how humanity lives. Like, we went from being migratory to being sedentary. We went from very flat tribal societies to very hierarchical agrarian societies. We went from being, clearly, like polygamous, polyamorous, whatever you want to call it, to being monogamous-ish. We went from having religions where, you know, everything was a spirit, a tree, a rock, everything had a spirit, and then we went from that to theistic religions where there was some different number of gods. Then fast forward to a couple 100 years ago, we had sort of the enlightenment. With the enlightenment, we had sort of big scientific breakthroughs and we figured out how to dig up stuff out of the ground and burn it and create energy, and make heat and electricity and all those things. And the constraint of it again shifted from, you know, how much land do you have to how much physical capital can you create? How many machines can you build? How many buildings, roads, railroads, et cetera? RITHOLTZ: That’s really interesting. WENGER: And we changed everything yet again. And so now the point of the book is, guess what? We have to change everything yet again, because capitalism, this is why the book is called “The World After Capital,” capital is no longer the binding constraint. Instead, it’s human attention. RITHOLTZ: Human attention, so that’s the third great shift is. So we went from agricultural scarcity to having enough food. WENGER: We went from forager to agrarian, so from food scarcity to land scarcity, then we went from land scarcity to capital scarcity. And now, we’re going from capital scarcity to attentional scarcity. RITHOLTZ: Capital is no longer scarce. So now attention is the new scarcity, which there’s a line in the book that really caught my eye, attention is time plus intentionality. Explain that. WENGER: Yeah. So speed just tells you how fast you’re going. Velocity tells you how fast you’re going towards something, towards some destination. RITHOLTZ: Speed plus direction. WENGER: Speed plus direction is velocity. And the same is true for attention. Time just tells you how much time has elapsed, you know, two hours. Attention is what was your mind and your body doing during those two hours. Were you, you know, just scrolling Twitter, or were you like working on a solution to the climate crisis? RITHOLTZ: So you say something about these transitions that really jarred me. Previous transitions like agriculture emerged over thousands of years and was incredibly violent. Industrial Age lasted over hundreds of years, and also involved lots of violence and bloody revolutions, and two World Wars, which raises the obvious question, what sort of violence is the next transition based on attention scarcity potentially going to involve? WENGER: Well, at the moment, the leading candidate is the climate crisis. We have known about it for literally hundreds of years, actually, and we have refused to do enough about it. And so now, we have entered the state where we’re getting extreme heat events. We’re getting extreme drought events. The food supply is definitely in question. Something that we have taken for granted for many years now. We’ve taken for granted that you can go to the store and buy food. Unless we really course correct very hard, very dramatically, and by dramatically, I mean, the level of government activation that we had in World War II. In World War II, we spend roughly 50% of GDP on the war effort. We need to spend roughly 50% of GDP on the climate crisis for several years sustained in order to actually avert it. RITHOLTZ: So that suggests that you don’t think there’s going to be some technological magic bullet going to appear out of nowhere? WENGER: Well, if you look at World War II, the government went to Ford and said, “We need you to build airplanes, not cars.” And actually, there’s a chart in my book that shows that output of cars dropped. We need to get to a similar point where we’ll say there’s certain things we’re just not going to do for a while because we need to do these other things. There are great technologies. We don’t need to invent some magic bullet that doesn’t exist. We just need to build a lot of what we already know how to build. Like, we need to build a lot of nuclear power plants. We need to build a lot of these ponds in the desert that can draw down carbon. There’s 1001 different things that we need to build. We just need to take our physical capital and point it at that. And when you do that at that scale, incredible things become possible. So, during World War II, Ford Motor Company built a plant, it was called the Willow Run facility. And in Willow Run, they built the B-17 Liberator bomber. Now, that’s a four-engine bomber, with lots of gun turrets to defend against fires. At peak production, they finished — they finished one of these every hour. RITHOLTZ: Amazing. WENGER: They finished a complete airplane every hour. And my point is once we decide to take our attention, and allocate our attention to what the real problem is, we can redirect our physical capital. We have plenty of physical capital. People say, “Oh, you can’t build nuclear power plants fast enough.” That’s if you built them in peacetime mode. If you built them in wartime mode, you could build them very rapidly. RITHOLTZ: So when you say this requires a substantial commitment of capital, let’s put a dollar amount on that. Are you talking — WENGER: Half of GDP. I’m saying half of GDP. RITHOLTZ: So you’re saying $10 trillion? WENGER: Yeah. RITHOLTZ: Just in the U.S. alone? WENGER: Yeah. RITHOLTZ: Now, we just passed a climate bill, arguably, that was a couple of billion dollars, $100 billion maybe over 10 years. And it was like pulling teeth, it was a miracle it just managed to skate through. And that’s a fraction of a trillion dollars. How you’re going to get 10x or 100x? Do things have to get much worse before they get much better? WENGER: Yeah. I mean, there’s a book about the climate crisis called “Ministry for the Future,” by Kim Stanley Robinson. And the book starts with a devastating heat event in India, where tens of millions of people die. I don’t know what it takes. But I can tell you, it’s only going to get worse, it’s going to get a lot worse. And at some point, hopefully, people — enough people will wake up and say, “No, no, we really actually have to get into a wartime footing. RITHOLTZ: So up till now, a huge swath of the population has been asked my grandkids problems, what wakes them up? Is that sort of events? I mean, you see what’s happening in California. You see what’s going on in lots of the United States with droughts. It seems like people are starting to pay attention. WENGER: Oh, absolutely. Yale does an incredible survey of climate attitudes. And it is very clear that even in the U.S., which has been lagging on this, a significant majority of people believe that the climate crisis is real, that is caused by humans, and the government should do something about it. So I actually believe this is going from a kind of a losing proposition for politicians to a winning proposition. And I think politicians need to be much more into it. Most of them still aren’t willing to acknowledge the full extent of this crisis. And the physics of this crisis are extraordinary. So because of all the CO2 we’ve put in the atmosphere, the amount of heat that we’re now trapping that used to radiate out into space, do you know how much heat it is? It is four Hiroshima-sized nuclear bombs every second. RITHOLTZ: It’s insane. I read that in your book and I was like, no, no, he must mean every week. Every second? WENGER: Every second. Now, imagine for a moment you had alien spaceships above Earth, throwing four Hiroshima-sized nuclear bombs into our atmosphere every second. RITHOLTZ: That would put us on a wartime footing? WENGER: And what will we do? Yeah. We would drop everything, right? We would be like, “They’re trying to kill us. We have to get rid of them.” I mean, we made a movie about it called Independence Day. RITHOLTZ: Four nuclear bombs every second? WENGER: Yeah. RITHOLTZ: And it’s just — WENGER: Of every minute of every hour of every day, it’s a mind-boggling amount of heat. RITHOLTZ: So there’s a couple of other things in the book I wanted to touch on. You mentioned alien visitors. We’ll hold off on the Fermi paradox discussion because nobody wants to hear me babble about that. But one of the things I thought was kind of interesting is the transition of the nature of scarcity. You’re right, it changes the way we measure human effort. It makes it more difficult, and we need increasingly more sophisticated ways of providing incentives to sustain unnecessary level of effort. Flash that out a little more. WENGER: So if you think of hunter-gatherers, right, I mean, you can see the results of effort immediately. RITHOLTZ: Right. WENGER: Like, you go to the forest, you either come back with something or not. RITHOLTZ: Right. WENGER: So it’s very easy to create incentives. Like, if you don’t find something, go back hunting and come back with something. RITHOLTZ: Or you’ll go hungry. Right. WENGER: When you go to agriculture, you have these, you need to see, you need to take care of it, and you don’t know how big a harvest you’re going to get. So you need a little more sophisticated incentive, and a lot of those incentives were often provided by a religion. Religion is sort of saying you have to apply yourself to this backbreaking work. This is the work of the Lord, et cetera. And then when we went over to capital, now it gets even more complicated because you might not see results of some effort for many, many years. I actually think when I say more sophisticated incentives, in the book, I talked a lot about just freeing up humans to pursue their interests, to make it so that you can freely allocate attention. And I’m always very inspired by mathematics. Like, you can’t get rich as a working mathematician, basically. I mean, yes, if you wind up going to Wall Street, you can. But if you actually keep working as a mathematician, that’s not a — you know, there’s also no patents. And you know, the only thing math works on recognition by peers, and there’s some prizes. There’s like the famous Fields Medal, and there’s some other prizes. And yet, the amount of math that’s been produced over the last, you know, few decades is just mind-blowing extraordinary. And I believe we need to bring that type of model to many, many more parts of the economy and parts of activity. So in a way, what all of “The World After Capital” is about is how can we shrink all the explicitly incentivized economic activity, where there’s an explicit, okay, you go to work and you get paid a wage kind of thing. And here’s a market transaction, how can we shrink that and make room for things that are super, super important, but cannot have prices, cannot be economically incentivized? Let me give concrete examples of that. Obviously, we’ve talked about the climate crisis. But let’s talk about death from above. Like, every million years or so, the earth gets hit by something very large out of space. That’s very, very bad when it happens. But there’s no market for allocating resources to that. There’s no supply and demand for it. So we, as humanity, need to decide that this is a real problem and we ought to be working on it. RITHOLTZ: Now, aren’t we tracking various large observed asteroids and doing some stuff? WENGER: We are, but the amount of effort we’re putting into this relative to the size of the problem is minuscule. The number of people who sort of truly globally work full time on this is a tiny fraction of the people we actually should have. And we’re also not working sufficiently on like what will we do if we detected one that’s clearly headed for us, right? RITHOLTZ: Well, you send Bruce Willis up and — WENGER: Exactly. Yes. RITHOLTZ: — he takes it, right? WENGER: Yeah, he does. RITHOLTZ: I mean, it’s not unknown. We know the regular major extinction events. There’s a real interesting theory that as the sun goes around the galaxy and passes over and above the galactic plane, that affects the asteroid belt and — WENGER: The famous Oort cloud is where a lot of these objects — yeah. RITHOLTZ: Right, which is full 360 around the — WENGER: Yes. So we know all of this. And here’s the interesting thing. When we went from the agrarian age to the industrial age, we didn’t get rid of agriculture. This agriculture today, right, we all eat food that’s grown in agriculture. But what we did is we shrunk how much human attention is required to do agriculture, and we took it from being like 80% of human attention to like sub 10%. RITHOLTZ: It’s less than 2% in United States. It’s tiny. WENGER: So what I want to do is, let’s do the same with the rest of the economic sphere. I’m not an anti-capitalist. I’m not a degrowth. Person. I’m not suggesting we should get rid of markets. I’m just saying we should compress market-based activity from absorbing much of human attention to absorbing maybe 30% of human attention, and we should free the rest up to work on these incredibly important thing. Some of them are threats, and some of them are opportunities, right, opportunity to cure cancer, opportunity to create incredible wildlife habitats, restore those wildlife habitats, opportunity to travel to space. I mean, all these opportunities that we’re not paying attention to because they’re not — again, they’re not really market price based and can’t be market price based. There’s just no prices for them. RITHOLTZ: So the conclusion of the book had a list of action goals, which was not what I was expecting in a book on venture capital and “The World After Capital;” mindfulness, climate crisis, democracy, decentralization, improving learning, and humanism. Address whichever those you feel like. WENGER: Well, these are all core components of how to have a — hopefully, a transition that’s not a violent transition, right? These are all about how could we get out of the industrial age into the knowledge age without some cataclysmic event, without a world war, without killing billions of people through the climate crisis, right? They’re also all components of what a knowledge age society might look like. Right? So let’s talk about mindfulness for a second. We’re constantly assaulted with new information now. You know, our brains evolved in an environment where when you saw a cat, there was an actual cat. Now, there’s an infinity of cat pictures. So if you don’t work on how you — how much you are in control of your mind, external sources will control your mind. So mindfulness, which is a much abused word, but it has become much more important in a world where we’re constantly assaulted by information flows, right? Let’s talk about humanism for a moment. Humanism is about recognizing that humans are the prime movers on this planet. We are the ones who have brought about the climate crisis. We are the ones who put a theory to solve it, or wind up getting wiped out by it. And it’s about this idea that, you know, with great power comes great responsibility. And so, we are responsible for the whales, not the whales for us. There is — at the moment, because we’re in this transition period already, and because things are going so poorly for so many people in this transition, there’s no a flight back to religion, there’s a flight to populism. And a big part of the book is about, no, there is a secular alternative way of thinking about society that embraces science, that embraces progress, that embraces humans and all types of humans, and that recognizes that we are first and foremost human, and only secondarily are we American, or Russian, or male or female or something else. You know, these are all secondarily. But primarily, we’re humans, and humans are fundamentally different from all the other species on the planet. RITHOLTZ: Quite fascinating. So let’s talk about the current state of the world for venture capitalists. We’ve seen valuations come way down for public companies. They’re pretty reasonably priced these days, about 16 times for the S&P 500. That’s historically, more or less, average. Where do you see the state of the world in early stage valuations? How are they holding up? A year ago, late stage valuations had gone just bonkers. Tell us a little bit about what’s going on today. WENGER: The correction always, basically, is a trickle-down type of correction. It happens very rapidly in the public markets. Then you still get some high-priced private rounds that either were in the works, or they have a lot of structure. In the later stage markets, you know, there’s a headline number. But then nobody talks about all the war in coverage that’s behind the scenes. And then the early stage valuations tend to sort of lag behind all of that. But we’re seeing early stage valuations come down. And as a firm, we’ve always been disciplined on valuations. So we just let a lot of things go where we just thought it was — RITHOLTZ: Are they down off the peak, or are they cheap and attractive? WENGER: The down of the peak, whether they’re cheap or attractive, I think, you know, time will tell. But we are back in a situation where, you know, there are seed deals getting done that’s below $10 million, certainly below $20 million, and you know, seed rounds that have a reasonable size. So you know, for a while we were seeing these $10 million, $20 million, $30 million seed rounds. RITHOLTZ: It sounds pricey. WENGER: Yeah. And that’s not happening anymore. But at Union Square Ventures, we’ve also always tried to basically be at the next era, at the next thesis and evolve our thesis before everybody else gets there. And once everybody else gets there, try and evolve our thesis. And so, for example, in the Climate Fund, we’ve made any number of reasonably priced investments, very reasonably priced. RITHOLTZ: So I always assumed it was tied to the public markets. But sometimes you just don’t realize, when you have a good couple of years in a row in the public markets, like we saw in the 2010, pretty much straight up through 2021, you see that impact and what people are looking for, what sort of deals get done, and valuations generally. WENGER: I always find it relatively surprising how much private early stage valuations are tied to public markets because our holding — RITHOLTZ: That’s the exit, right? WENGER: But our holding periods are 5, 8, 10 years. And so, like, what’s the current public — RITHOLTZ: Right. WENGER: And so there’s a couple of different explanations. One, obviously, is just investor sentiment, right? RITHOLTZ: Right. WENGER: You know, when investors are like bearish because of what they’re seeing in the public markets, they take a bearish attitude towards their own investing. We try — at Union Square Ventures, we try to have a pretty steady pace as one way of contracting our own sort of — you know, whatever our own emotions may be about the public markets. There is, however, another effect that sometimes is underestimated, which is that the people who give money into venture funds, so these are pension funds and endowments, and so forth, they have a certain whip from the public markets, because when they’re feeling flashed on the public markets then their private allocation, you know, as a percentage of their overall portfolio, they have a certain target in mind. Then when the public markets come down a lot, all of a sudden, they’re overallocated, so they want to pull back. So there is a mechanism by which the current public markets transmit into the private markets. There’s a real financial mechanism. There’s a psychological mechanism and a real financial mechanism by which some transmission, some contagion basically happens from the public market into private market. But it doesn’t make very much sense. Like, if people were sort of more cognizant of both that emotional reaction and this mechanism, they’d be like, “Well, yeah, but innovation is happening at some pace. In some area, there’s some innovation and we should be funding that innovation.” RITHOLTZ: So I’m just making notes, investors are irrational. WENGER: Deep and profound insight right here. RITHOLTZ: Right. There you go. WENGER: You’ve never heard this one before. RITHOLTZ: So to put that into a little context, 2020, 2021, very founder-friendly deals. Now, it seems like a little more investor-friendly, a fair assessment or not quite there yet? WENGER: Well, when it comes to founder-friendly versus investor-friendly, there’s a lot more to deal than valuation. There’s all the other terms. And while I believe we will see a correction on valuation that’s pretty significant, I don’t think we’re going to go back to where venture capital was 20 or 30 years ago, that had all these super draconian terms. Certainly, even at the early stage, even at the early stage, there were all these like — there were redemption provisions in the early stage deals. I don’t think that’s going to come back. We are not fans of structure in latest stage deals. Like, just to give a good example, when I was still on the board of Twilio, Twilio had the option of doing a totally clean, no structure round and call it $1,000,000,001. In a highly structured round with like — you know, we’re going to have a full ratchet into an IPO at a $1,000,000,005. And I was — you know, some of the other investors at the table really wanted the $1,000,000,005 number because it’s a big headline number. And I talked to Jeff and I said, “It doesn’t make any sense.” RITHOLTZ: Right. WENGER: You don’t actually know what your deal is until many years. Like, just take the deal where you know what the deal is today and you know what the deal is a year from now, and two years from now, because it’s not going to change based on circumstances. RITHOLTZ: Right. WENGER: And so Jeff took the clean deal, and that enabled Twilio to go public when the IPO window reopened. Whereas at the $1,000,000,005 deal, they wouldn’t have been able to go public. And that worked incredibly well for Twilio to become a public company. RITHOLTZ: Really interesting. So since we’re comparing early stage investments to the public world, lately, everybody has been looking at different sectors the past year. Energy has done well, technology not so much. Within venture, do you see that same sort of segmentation, different sectors have different — WENGER: Well, we were basically the first sort of venture firm to have a dedicated climate fund. And now, many of the venture firms are following suit, either adding a climate pocket to their existing funds, or a climate thesis or, you know, some people call it sustainability fund. Ours is very focused on climate. So for instance, we don’t deal with water waste. It’s strictly about atmospheric carbon. So there’s a lot money rotating into that sector. There’s still healthy sort of activity around Web3. So you know, Web3, there’s still — RITHOLTZ: Crypto, blockchain, all that? WENGER: Yeah. There’s still healthy sort of activity. I do think that certain kind of software companies that had found it very easy to raise money, I think they’re finding it a lot harder, just because people have looked at it and said, “Wow, I think we’ve reached some stage of normalization in this market.” You know, like, not everything in this market is going to be a $50 billion outcome. There’s going to be many, much smaller outcomes, and so we need to adjust accordingly. And also, many of these markets had just too many companies raised venture capital doing basically more or less the same thing. RITHOLTZ: So it was easy to raise money for a fund today, a little more challenging, even if you’re a pretty decent sized VC with a 10, 20-year history. Are they having difficulty going back to their clients saying, “Hey, we’re doing another billion dollars?” WENGER: You know, I think that we will only see a year from now, or two years from now. There were a lot of funds that have put out a lot of money very, very rapidly, and we’ll see just how big the hangover is. But we won’t know that for some time. RITHOLTZ: So some of the folks who give advice to founders like Chamath and Jason, and the crew with the All-In Podcast, they’ve been talking about — preaching really about cutting costs and reducing your burn rate, and get ready for a tough year or two. How do you see this environment? Is that good advice, or do you really have to, you know, go all out and get more funding as opposed to trying to make a more modest burn rate last longer? WENGER: There’s very little one size fits all advice that makes sense. RITHOLTZ: Fair. WENGER: Nonetheless, we held a call early this year for all of our portfolio companies. And we said this really is a big adjustment and it’s not a one or two months’ blip. This is a long-term adjustment. And it was great because we had some CEOs in our portfolio who had managed through the implosion of dot-com bubble, and they spoke about just how difficult the funding environment can get. So generally speaking, we did a lot in ’21 because we saw this coming. To me, the biggest sign of the bubble really was — that we really were reaching the tail end, was all these incubation efforts that were being raised. And I knew this because I had raised money into an incubator in ‘99, towards the end of the dot-com bubble. And I think when investors think, “Oh, I don’t even need the entrepreneur, I can just start the company myself,” that’s kind of when you know that it’s gotten too easy, right? And that’s not going to lie. So in ‘21, we took a lot of liquidity. We sold a lot of things that we were able to sell. And we told all of our portfolio companies to raise money. And so — RITHOLTZ: Last year, this is — WENGER: ‘21. Yeah. Well, it’s best to do things before. RITHOLTZ: Sure. Sure. WENGER: Right? So as a result, we have very few companies in our portfolio that need to raise. We have some, but we have very few. And then, you know, at the beginning of this year, we told everybody who had raised successfully, “You got to make this money lasts much longer than you thought when you raised it.” And so, yes, absolutely. You know, companies were operating with very inefficient growth. Because it was easy to fund inefficient growth, you could be burning $1 million, $2 million, $3 million, $4 million a month. And you know, if you were growing 405%, 50%, 60%, that was good enough. That’s not going to be the case. So you’re either growing very fast, or you have something very compelling, in which case you can raise money, or you are growing, you know, 20%, 30%, but you are growing very, very efficiently, right? So being in the sort of 50% growth, but you’re super inefficient, that’s going to be a really tough place to be. RITHOLTZ: All right, so before I get to my favorite questions, I have two questions I’ve been sitting on sort of from the book and some from your blog continuations that I want to hear where you go with this. And the first one is a quote from the book, “Malthus could not foresee the scientific breakthrough that enabled the Industrial Revolution.” I think you let him off the hook a little too easy. It’s just an abject failure of imagination. And you are in the imagination business. The Malthusians, weren’t these folks just unable to imagine any sort of progress or technological development? WENGER: Well, we have had more progress and more technological development than people were able to imagine. I think, conversely, we’re now in the opposite trap. We can’t imagine that things could get really, really bad. We can’t imagine that the climate crisis could disrupt our food supply to the point where billion people starved. We simply can’t wrap our head around this idea. So I think we’re in the opposite trap at the moment. We’ve been so used to the success of progress, and we’ve so neglected the engines that produce progress, that I think we’re in the opposite trap at the moment. RITHOLTZ: What are the other engines? Is it early stage investing from governments when the project has a 10 and 20-year ROI that the private sector won’t do it? WENGER: It’s foundational research. We’ve not had a true breakthrough in science since quantum mechanics. It’s a hundred years ago. So general relativity and quantum mechanics are hundred years ago. Now, we’ve made some progress in biology. Biology, we’ve had some really good progress. But you know — RITHOLTZ: You’re talking fundamental science not technology. WENGER: Fundamental science. RITHOLTZ: Like, I immediately think of semiconductors was a giant — WENGER: Oh, no, incredible progress. But fundamental science, we’ve not had a true big unlock in a hundred years. Now, I think when we talk about engine of progress, this is also how hard is it to start a business? How many regulations do you have to comply with? How expensive is it to comply with those regulations? We’re also talking about — we’re still subsidizing oil and gas globally, to the tune of trillions of dollars. RITHOLTZ: Yes. Yes. WENGER: Subsidizing oil and gas, it’s crazy. RITHOLTZ: Which by the way, helps to explain why so many people have an incentive to either question the impact, the source or the reality of climate change. WENGER: Yes. RITHOLTZ: There’s forces that work there. WENGER: And so, I believe we’re in this sort of opposite trap today. And you know, people like to make fun of Greta Thunberg. But young kids, young activists understand the severity of the climate crisis in a way — RITHOLTZ: Right. WENGER: — in a way that most adults don’t seem to be willing to accept. RITHOLTZ: Right. I don’t think climate change is going to impact my life. You know, I’m 60. I’m going to run out the clock. WENGER: You’re not. RITHOLTZ: Someone your age — WENGER: The reality is you’re not. You’re not going to escape. You and I are not going to escape this. It’s here, it’s now and it’s only going to get worse. RITHOLTZ: I don’t doubt that for a second, but — WENGER: And here’s the thing, I think — RITHOLTZ: I challenge — WENGER: We could live in this amazing, incredible future. Like, wouldn’t you rather live in a city that has mostly electric or all electric cars in it? Like, the air would be so much better. Wouldn’t you rather live in a world that has huge — like, think of all the Midwest, instead of growing corn to feed cows — RITHOLTZ: Right. WENGER: — super inefficient. If we can grow the meat of the cows in the vast instead, we could have like incredible forests. We could have incredible wildlife areas. Like, we could have this amazing, incredible future. We could have energy reserve. If we build more nuclear power, electricity could basically be almost free. So we have this amazing thing we can go. Instead, we’re headed for this complete disaster and we’re mostly like, “eh.” RITHOLTZ: I think that’s a fair assessment. I think you definitely have that. And I certainly see people my generation, absolutely think it’s not going to impact them or minimum impact, it’s really the grandkids’ problem. WENGER: Yeah. And it’s just — that’s totally, utterly wrong. RITHOLTZ: All right, one other curveball I have to ask you about, which involves Yuval Noah Harari, who says in Sapiens, “All value systems are based on equally valid, subjective narratives, and humans have no privileged position as a species.” You say he’s wrong. Explain. WENGER: Not just wrong, it’s completely dangerous because it opens the door to absolute moral relativism. It’s sort of like, well, if you believe that, then, you know, the ISIS narrative is just as valid, you know, and I just think that’s wrong. And I do think there’s an objective thing, which is humans have knowledge. And by knowledge, I mean, I can read a book today that somebody else wrote in some other part of the world a thousand years ago, right? No other species on the planet has this. I mean, other species have amazing things about them, but none of them has knowledge. And that puts us in a privileged position. By the way, privilege comes with obligation. That’s usually what it used to mean. Today, we think of privilege just it lets you do whatever you want. But it used to mean that you had real obligations, right? And I believe because we have the power of knowledge, we have real obligations to other species. Other species don’t have much of an obligation to us, but we have an obligation to them. RITHOLTZ: And the interesting thing about what you said is not only does no other species have the ability to access anything, anybody has written, anytime in history, pretty much this is the first generation that had access in that way, across — pretty much across the whole board. WENGER: Well, this is the amazing thing about digital technology, right? We could use it to make all the world’s knowledge accessible to everybody in the world. And great things could come from that, right? So there’s some people like Elon Musk and others who are like, “Oh, my God, the population is going to, you know, decrease a lot and that will be bad.” I’m like, no, we have 8 billion people at the moment, peak population. The present trajectory might be 11 billion, although if we don’t get on top of the climate crisis, it will decrease actually rapidly. But we’re making such poor use of it. Why? Because so many people don’t have access to knowledge, don’t have a shot. I always love the story of Ramanujan, the famous mathematician, who used to send a letter to Hardy. And Hardy was like, “We should bring this guy over to England and he would have been a very productive mathematician.” There are Einsteins, and Ramanujans, and Elinor Ostrom, and Marie Curies all around the world today, and we’re not giving them — so we’re vastly undertapping human potential. And we can use digital technology to change that and to give everybody access. And that’s one of the things, one of the great opportunities that we have in this transition to the knowledge age. RITHOLTZ: Quite, quite fascinating. So let me jump to my favorite questions that I ask all of my guests, starting with, tell us what kept you entertained over the past couple of years. What have you been watching or listening to? WENGER: I really don’t watch much. At the moment, the only thing I watch with any kind of regularity Sabine Hossenfelder’s YouTube series called Science Without the Gobbledygook. RITHOLTZ: I’ll take a look at that. I’m a giant fan of YouTube Premium, and I’m always astonished that people I know who are YouTube junkies won’t spring for the 8 bucks a month to pull out commercials and distractions. But YouTube is just an endless rabbit hole. WENGER: Well, YouTube is an example of the best and the worst of the Internet all in one place, right? There’s so much amazing knowledge like Sabine’s videos, Veritasium. I mean, you could learn almost anything from how to fix your dishwasher to how — you know, the theory of general relativity works. At the same time, YouTube is also this place where tons of people, you know, become radicalized or redpilled, or whatever it is, because the algorithm — the algorithm has the wrong objective function, right? Its objective function is engagement. It’s not lifting people up. RITHOLTZ: Tell us about some of your mentors who helped shape your career. WENGER: I was super, super fortunate when I was an early teenager. We talked about this, when I first fell in love with computers. I lived in a relatively small village in Germany. And there was one computer science student there who was maybe 10 years older than I was. And he just spent time with me, and he gave me his books, and he gave me his floppy disks with software, and he helped me sort of understand all this. And I’m forever grateful to (Anstur Guenther), wherever you are in the world. RITHOLTZ: That’s really interesting. Have you spoken to him anytime recently? WENGER: No, because I haven’t been able to find him. Basically, he seems to have disappeared. RITHOLTZ: Well, if you’re listening, reach out to Albert. Tell us — we mentioned a number of books. Tell us about some of your favorite and what you’re reading right now. WENGER: Favorites, I would say David Deutsch, “The Beginning of Infinity” is definitely one of my favorites. RITHOLTZ: I just ordered that because of you. WENGER: I’m reading at the moment, a book by Ada Palmer called “Perhaps the Stars.” It’s the fourth book in a series called the Terra Ignota Series. She’s a professor at the University of Chicago. RITHOLTZ: What sort of advice would you give to a recent college grad who is interested in a career in either entrepreneurship or venture capital? WENGER: Develop a mindfulness practice, you know, whatever works for you, whether that’s yoga, running, for me, it’s conscious breathing. I just think it’s such a superpower not to get hijacked by your emotions. It’s a true superpower. And the more humans can cultivate it, the more we can achieve. RITHOLTZ: That’s really, really intriguing. And our final question, what do you know about the world of venture today that you wish you knew 30 or so years ago when you were first getting started? WENGER: There will always be another bubble. RITHOLTZ: There will always be another bubble. That’s amazing. Just human nature can’t be avoided. WENGER: It can’t be avoided. RITHOLTZ: And what should we do in anticipation of during and after bubbles? WENGER: We should acknowledge that they will come, that they’re part of how we operate, that you can make money before, during and after. RITHOLTZ: There you go. Really, really fascinating stuff. We have been speaking with Albert Wenger. He is managing partner at Union Square Ventures. If you enjoy this conversation, well, be sure to check out any of our previous 400 or so discussions we’ve had over the past eight years. You can find those at iTunes, Spotify, or wherever you get your favorite podcasts from. We love your comments, feedback and suggestions. Write to us at Sign up for my daily reading list at Follow me on Twitter @ritholtz. I would be remiss if I did not thank the crack staff that helps put these conversations together each week. Sarah Livesey is my audio engineer. Sean Russo is my head of Research. Paris Wald is my producer. Atika Valbrun is our project manager. I’m Barry Ritholtz. You’ve been listening to Masters in Business on Bloomberg Radio. END   ~~~   The post Transcript: Albert Wenger appeared first on The Big Picture......»»

Category: blogSource: TheBigPictureSep 20th, 2022

55 Money Making Apps And Websites

Everybody could use a little extra money now and then, even those making a decent salary. Maybe it’s to go on a dream vacation, pay down debt, or shore up your retirement. There is no doubt that the increasing digitization of our world has made making money online easier than ever before. But, with so […] Everybody could use a little extra money now and then, even those making a decent salary. Maybe it’s to go on a dream vacation, pay down debt, or shore up your retirement. There is no doubt that the increasing digitization of our world has made making money online easier than ever before. But, with so many options, where do you start? Well, here are 55 genuine money-making apps and websites. Besides the flexibility and income potential, they vary in skills and interests. Although they were not ranked in any particular order, they were ranked from lowest to the highest effort. if (typeof jQuery == 'undefined') { document.write(''); } .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get The Full Henry Singleton Series in PDF Get the entire 4-part series on Henry Singleton in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q2 2022 hedge fund letters, conferences and more   Find A Qualified Financial Advisor Finding a qualified financial advisor doesn't have to be hard. SmartAsset's free tool matches you with up to 3 fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests. If you're ready to be matched with local advisors that can help you achieve your financial goals, get started now. Make Money From Your Home and Vehicles Got a car or spare collecting rust and dust? What if they earned money for you with minimal effort? 1. Airbnb In terms of making money with your house, Airbnb is one of the most popular options. It allows you to advertise a second residence, a guesthouse in your backyard, or a spare room to prospective guests. Of course, it’s totally up to you when and where you rent out the space or home you own. As of 2021, the average host on Airbnb in North America will earn $41,026. However, the area in which you live and the space you are listing will have an impact on your earnings. As an example, a rental of a single room in your house with shared facilities will not generate the same amount of revenue as a finished basement with its own entrance, bathroom, or kitchen. If you really want to bring home the bacon, though, you’ll need to rent out an entire home. 2. Neighbor Does your home have a storage area like a closet? Or perhaps a garage or storage shed that’s empty? This space could be rented out on, an alternative to Airbnb. But, instead of a spare room or home, it’s storage space. It is up to you to set your own prices. At the end of the month, you’ll then receive either a debit card or direct deposit. Just note that you will be charged a processing fee of 4.9% of the total reservation plus 30 cents per payout when you use 3. Turo Through Turo, you can earn extra money by renting out a car that you don’t use often. On this site, car owners can let travelers drive their cars, earning up to $600 per month. In order to lend a car, you must have fewer than 130,000 miles on it, as well as meet insurance and maintenance requirements. There are exceptions, though, for classic or specialty vehicles. Travelers are screened by Turo and are offered insurance to protect them. Alternatively, you can meet your driver at a predetermined location or drop off your car at the airport. 4. Fluid Truck Your truck from 2001 or newer can be lent out to borrowers on Fluid Truck — for a fee, of course. An average pickup truck can earn $10,000 per year. But, a 20-foot or larger box truck can fetch up to $20,040 per year. In addition to offering insurance protection to truck owners, Fluid Market vets its borrowers before allowing them access to your vehicle. 5. Outdoorsy Unless you’re living a nomad lifestyle, and you’re an RV owner, it’s probably sitting there waiting for its next adventure. If that’s the case, you list your motorhome to bring in some extra cash — the site states up to 50 grand a year. Like the platforms above, you can set the rates and schedule. Moreover, every rental includes free roadside assistance and liability insurance up to $1 million. And, as soon as the trip departs, the money is deposited into your bank account within 24 – 48 hours 6. Wrapify As a result of this service, your car becomes a mobile billboard — without damaging the paintwork. Based on the website’s claims, you can expect to earn between $196 and $452 per month. It just depends if you go full, partial, or lite. Many of Wrapify’s clients are household names. However, some vehicles are difficult to wrap ads around, the website notes. For example, it does not work on Hummers, Wranglers, PT Cruisers, HHRs, VW Beetles, or soft-top convertibles. As far as motorcycles and motorhomes are concerned, it does not wrap them either. Walk, Read, Shop, and Just Be Yourself to Make Money Through these apps, you get paid for everyday tasks you already do. Even better? With some of these apps, you can also improve your habits while earning an effortless income. 7. HealthyWage You can bet money on losing weight in a certain time frame with HealthyWage. It is important to note that your weight needs to be verified, which you can do by sending a video or by having a HealthyWage “referee” remotely witness you doing so. In addition to winning the prize money, you also win the money you bet if you lose the desired weight. What if you don’t lose weight? Well, you don’t win any money. As a result, you lose your bet. The amount of money you win will depend on the amount you bet and whether you succeed in losing weight. In other words, you may lose more money than weight if you aren’t careful when using HealthyWage. 8. Sweatcoin Sweatcoin is perfect for those who enjoy being outdoors and staying active. Using your phone’s accelerometers and GPS location, this app tracks and verifies your outdoor steps. So, in short, with every step, you will earn currency or Sweatcoins. Seriously. Is there anything better than making cash and getting fit at the same time? 9. MyAchievement The MyAchievement app pays you for tracking your steps, your sleep, and your food intake. Be aware that for market studies, the company partners with health companies. For every 10,000 points you collect, you will earn $10. On the downside, there is no such thing as one point for one step. As such, you may need some time to accumulate 10,000 points. As a matter of fact, you can collect up to 80 points per day. 10. HoneyGrain Your Internet service can be used to earn passive income with Honeygain. You can use as many devices as you want, and Honeygain taps into your Internet bandwidth for as many small tasks as you want. Your personal information is never shared with Honeygain since it runs passively in the background. Despite their site’s claim, most people report earning much less than $55 per month from the service. The app is compatible with macOS, Windows, Android, and Linux operating systems. And, you even get $5 for signing up. 11. Market Force Market Force allows you to test out products and services for grocery stores, restaurants, pharmacies, and even gas station convenience stores. But, the coolest gig is being a “theater checker.” The studios and theatres want to know how many people bought tickets on opening day, what screen times are popular, and what previews are playing beforehand. Furthermore, you get a free movie in exchange for performing these tasks. The pay ranges from $10 to $20 per hour, which is pretty sweet. 12. Nielsen Mobile Panel Are you familiar with the company that tracks TV ratings? According to their website, they are also interested in measuring the popularity of websites and online videos. According to Nielsen’s website: “In order for us to report accurate data to the mobile industry, we use Nielsen’s proprietary applications and profiles to measure the normal activity of your phone, tablet, or another mobile device. All data transmitted is encrypted and anonymous. All you have to do is download the Nielsen Mobile App or install our profile, depending on your device, and then continue using your mobile device as you usually do – that’s it! The Nielsen Mobile software is undetectable and will not affect your device’s performance or battery life.” Here’s the lowdown: In exchange for keeping Nielsen’s app on your phone, you will be paid $50/per year. After registering, they will send you instructions on how to download the app. Upon completion of the installation, you’ll be asked to restart your device. You’ll receive up to $50 a year for using your phone as you normally do as a member of the Nielsen Mobile Panel. 13. MyPoints By using the MyPoints app, you can earn cashback on your purchases. In addition to Amazon and Walmart, the company also offers coupons for Apple, Target, and Groupon, among other retailers. Once you’ve signed up, explore their website for coupon codes. You’ll receive your rewards via PayPal or a variety of gift cards if you shop at any of the 2,000 participating retailers. 14. Fetch Rewards By taking a photo of your receipts from stores and restaurants, you earn points you can use for rewards. In most cases, however, digital gift cards will be used. Once you get into the habit of taking the photos, earning cash back and gift cards should be easy enough. It’s important to remember that points expire if your account is inactive for 91 days. 15. iBotta Make your shopping trip more rewarding by downloading iBotta before venturing out. Simply take a picture of your receipt after purchasing a qualifying item and earn instant cashback. Get Paid for Surveys, Reviews, Testing, and Mico Jobs These apps and websites can make your online downtime more profitable if you spend a lot of time scrolling through your phone. While they won’t turn you into a millionaire, these opportunities can boost your social skills by paying you for interactions. 16. Swagbucks Earn rewards when you watch videos, participate in surveys, shop online and answer surveys with Swagbucks. Your points can then be redeemed at your favorite retailers for cash back or gift cards. Your job is basically to do what you already do online and earn money for it. Among the gift cards you can redeem are those from Amazon, Walmart, and other retailers. 17. Google Opinion Rewards The Google Play Store gives you credits that you can use at the Google Play Store by answering questions and providing feedback. The credits can be used to purchase apps, films, music, and games. 18. Survey Junkie Although this is a smaller survey aggregator, it provides a decent point value for your time. With every completed survey, you’ll earn points redeemable for PayPal cash or gift cards. You can also earn money by providing your opinion at Survey Junkie. 19. Opinion Outpost Taking surveys on Option Outpost is easy thanks to an easy-to-understand points system. As a result, you can actually make a little more money than you would similar survey apps. As an added bonus, you can spend your earnings on Amazon. 20. If you’ll spend an hour or so offering your opinion on products or services, some focus groups will pay you a decent amount. I’m talking like $50 or $100. Perhaps you will be asked to discuss your favorite brands for an hour and a half, or you might be asked to answer questions about social media use. You’ll be able to find focus groups that offer cash for your opinions, although some will not be a good match for you. 21. Mistplay Gaming enthusiast? Mistplay might be the place for you to make a little extra cash. They have an app where you can play games and earn rewards. To recommend the best games to its users, the app uses machine learning and data within the games. As if that weren’t good enough, you can earn money playing games if you join its loyalty program. 22. Amazon Mechanical Turk For people with video, image, and data entry skills, this platform is could help you make some extra cash. While micro jobs are short-term and pay fast, earnings are low and vary from a few cents to $50/task on average. 23. InboxDollars Take surveys, play games, read emails, conduct internet searches, or watch short videos at InboxDollars to earn real money during downtime. Getting a payout can take a while, so the new user $5 bonus helps. 24. PrizeRebel Within five minutes, you can begin earning Amazon gift cards and PayPal cash. In addition to completing surveys and offers, PrizeRebel members can also watch videos to earn points. 25. User Testing Applying to and being accepted will pay you to test various websites and apps. In addition to taking the practice test and filling out some basic information, you will have to take a short interview. You’ll also need to have a new computer or smartphone. Tests can earn you $4 for five minutes or $10 for 20 minutes. And, you can make between $30 and $120 for taking live interviews about your experiences with various websites and apps. Sell Second-Hand or Orginal Items People can offer items they own on eBay, Craigslist, or even through Facebook groups. But this typically resembles a full-time gig. While there’s nothing wrong with that, these sites make it easier to sell your stuff. 26. Declutter Here you can get rid of used CDs, DVDs, games, books, as well as phones, tablets, and game consoles that are just wasting space. Just scan items they want to sell with your phone and get an instant offer on them. After accepting the offer, you print a free prepaid label and send your stuff. As long as your shipment isn’t damaged, you’ll receive a check or a direct deposit. If you have an old DVD or CD, you might get a few bucks (or cents). However, if you have an old smartphone, you might get $100. 27. Mercari As “The Selling App,” Mercari makes it easy and convenient to sell almost anything without having to meet up with the buyer. List your items, and when you get a buyer, you’ll get an email with a shipping label. There is no charge for listing on Mercari. But, Mercari takes a flat 10% selling fee after a sale closes. 28. OfferUp This mobile marketplace for local buyers and sellers can be compared to Craigslist. However, it’s a whole lot safer and more convenient. The OfferUp app (for iOS and Android) lets you list items for sale and receive messages from prospective buyers. As you negotiate with buyers, your personal information will not be disclosed. Also helping you feel safe and secure during sales are user ratings, TrueYou identity verification, and prescreened meetup locations suggested by the app. 29. Gazelle Do you have an old cellphone or another device like an iPad or computer? If so, turn these old devices into cold, hard cash. You can sell your device to Gazelle for cash. Materials for packaging will be provided if you agree. Upon receiving the check, gift card, or cash transferred to your PayPal account, Gazelle pays the shipping costs. The return may not be great. But it’s better than letting an unused device become nothing more than a paperweight. In addition, selling it is better for the environment than throwing it away. 30. Swap Swap is a consignment store. But, it’s online. If you send Swap used clothes, toys, and games, they will sell them on your behalf. You can make 15% cash back and 20% store credit if the item is priced at $8 or less, according to the website. You’ll receive 70% of the sale price, less a $4.95 processing charge, plus 20% store credit if your item sells for more than $8. The process is simpler than selling on Facebook Marketplace, where you generally have to meet the buyer personally. You just need to gather items from your home and put them in a prepaid box. 31. VarageSale VarageSale allows users to buy and sell items at virtual garage sales. Founded in Toronto by an ex-elementary school teacher fed up with scams and fake listings everywhere else. Each VarageSale user profile is verified manually before they are allowed to buy or sell. All profiles are based on real identities. In addition to browsing seller ratings, buyers can message sellers to get in touch before making a purchase. Using the app, users can ask questions, purchase products, and schedule pick-ups. VarageSale is used to sell a wide variety of goods, such as furniture, clothing, shoes, and more. Using the app is also free for members. 32. Etsy Etsy is another place to sell used items — especially if they’re vintage. However, it is designed specifically to sell handcrafted or customized items as well as craft supplies. In Q2 2020, Etsy had over 60 million buyers, making it a lucrative platform for online sellers. Each item you sell on Esty will be charged a listing fee of $0.20. It is recommended that you renew your listing every four months. The reason? The additional $0.20 will be charged if your item doesn’t sell. The transaction fee is 5% of the displayed price, plus the amount you charge for shipping and gift wrapping. 33. CardSell Do you have unused gift cards laying around? If so, you can get cash or another gift card from CardSell. Further, CardSell doesn’t give you the full value of your gift cards. But the process is simple and free. And, it’s better than just having those unused gift cards going to waste. 34. Dreamstime Images, audio files, and video clips can be sold when you join the Dreamstime community. Photographs and clips that appeal to a wide audience will appeal to blogs, corporations, and individuals. If you’re looking for ideas, take a look at their featured categories and themes. Your revenue share for each transaction is 25-50%, with bonuses possible. You must submit only original content without offensive content to Dreamstime. If you can earn extra money by using your media skills, why not capitalize on that? 35. Fatllama Don’t want to permanently part with your stuff? No problem. You can rent out your belongings on Fat Lama at a price you choose for those who need them. If you lend your unused belongings for a short period of time, you can earn anywhere from $50 a week to $10,000 a month. Additionally, Fatllama encourages you to get involved in your community. It also reduces the need for mass manufacturing and carbon-intensive distribution systems. Make Money With Investing Apps There is no such thing as a sure thing when it comes to investing. With that in mind, it’s always important to read the fine print on each website before getting too excited and investing a lot of money. 36. Acorns With Acorns, your purchases with a credit or debit card are rounded up, and the money goes into a robo-managed account. It’s a nifty and easy-enough concept. In spite of this, there are monthly charges that may offset the gains you receive from your investments ($1 to $5 per month, depending on how you set things up). 37. Betterment It is no surprise that Betterment is one of the most popular and largest robo-advisors. Using a selection of ETFs, the app provides professionally managed portfolios that are calibrated according to your risk tolerance. Portfolios created by Betterment can also focus on climate change or social impact in order to be socially responsible. If you want a professionally managed portfolio and cash management account at a low cost, this is the app for you. 38. DiversyFund To invest in Real Estate (REIT) Funds, you will need at least $500. The good news? There are no management fees. On the flip side, DiversyFund states on its FAQ page that you won’t see a return until five years after investing. This is assuming you see any return on your investment. 39. Wealthbase This is a relatively new entrant into the world of stock market games. However, it may be the most user-friendly app we’ve seen to help you pick stocks while also having fun. If you want, you can set up games with friends that will last for a few weeks, days, or even just until the day is over. The app lets you pick stocks and play games with friends and coworkers in a social environment. Plus, there is no minimum balance requirement. 40. Fundrise Through an investment platform, everyday investors can purchase commercial and residential properties through this online real estate company, similar to DiversyFune. So, if you’ve never invested in real estate before, this is a way to try it out — particularly if money was an issue. The minimum investment is $500. And there are fees (an annual management fee of 0.85%, an advisory fee of 0.15 percent, and any other fees that might apply, depending on how much you’re investing). Make Money Driving People and things need to be moved from point A to point B, no matter the amount of effort required. Despite Uber and Lyft being the most well-known ways to earn money by driving your vehicle, there are a variety of other options as well. 41. Lyft Lyft, as you probably know, is a rideshare app. Getting started is as simple as passing a background check and having a clean driving record. Also, a car with a minimum age of ten years and in good mechanical condition is required. Through the Lyft website or app, you can sign up to drive if you meet these requirements. It won’t take long before you’re approved, and you’ll be able to start picking up passengers. Lyft drivers enjoy choosing their own hours and working as much or as little as they like. As such, it’s the perfect side hustle during the weekend or in retirement. 42. Uber In the same way that you can earn cash driving people to their desired destinations via Lyft, you can do the same with Uber. Ride requests are made through the app, which can be downloaded by customers. Once someone requests a ride, your phone will alert you. For those who prefer not to drive alone, Uber Eats is a good option. In place of picking people up, you deliver food to their homes. Travel frequency, location, and time of day can affect wages. 43. DoorDash If ridesharing isn’t your bag, you can still make some bank using your vehicle with DoorDash. Instead of transporting people, you deliver food to customers from local restaurants. As with Lyft and Uber, you can set your own hours. Also, you’ll need a smartphone and reliable transportation. 44. Instacart Rather than delivering takeout, you’ll deliver groceries with Instacart. Depending on how much you shop and deliver, you could make anywhere from $7 to $10 per delivery. Regardless of whether you’re working as an independent contractor or part-time employee, there may be an in-person orientation and paperwork, like a W-9 or W-4 tax form. 45. Postmates To use this courier service, you must be at least 18 years old. Usually, deliveries are made by car. However, you can also bicycle, ride the bus, or walk. Depending on where and when you make deliveries, you will receive different rates. Find a Part-Time or Freelancing Gigs Finally, here’s a list of sites and apps for freelancers who those looking for a part-time income. 46. Fiverr Some talents can be quite marketable, and we all have a few. Drawing illustrations, designing logos, creating online content, and offering a voice for a podcast intro is among Fivver’s featured gigs. And, it’s through Fiverr that you can connect with people who could use these talents. The starting price for gigs is $5. Upsells, however, are the key to making more money. And, it’s a handy platform if you’re looking to build a freelance portfolio. 47. Upwork There are many categories of freelancing available on Upwork, including writing, editing, designing, web development, consulting, translating, and analysis. The site will then recommend jobs based on your skillset once you’ve completed your profile. Payments are handled through the site, as well as hiring and invoicing. In other words, you can spend more time earning money instead of chasing after clients or payments. 48. TaskRabbit The TaskRabbit platform allows employees and those in need of small services to connect together. “Taskers” are people who provide small services for TaskRabbit, which was founded in 2008. It’s basically a physical or concert services equivalent of Upwork or Fiverr. You can join TaskRabbit in just a few clicks. To register online, you need to provide all your details, such as your name and address, and don’t forget to include your skills as well. A city-specific onboarding session follows a successful background check. You can download the app and start searching for gigs after you’ve completed the onboarding session. 49. Handy Handy will connect you with customers who will pay for your expertise, no matter if you’re a boss-level house cleaner or a neighborhood handyman. A house cleaner can make up to $22 per hour and a handyman can make up to $45 per hour. It is necessary, however, that you have paid experience before applying. 50. Zirtual Using your instincts and administrative skills to their fullest potential is what Zirtual is all about. By becoming a virtual assistant, you can help clients with tasks they don’t have time to handle, such as scheduling meetings, paying bills, and booking travel. Many such websites provide fewer incentives for work-though you can make thousands per month through Zirtual by earning $12-$15 per hour as a beginner. You can earn over $5000 per month like a VA rock star as you progress up the ladder. 51. Steady Interested in side hustles? Steady might just be your best option. By bringing together thousands of gigs, this app helps to eliminate the clutter from the gig market. By doing so, you won’t waste time on jobs you won’t like. But, what makes Steady stand out is that it offers cash incentives and access to information like employer pay rates. 52. Tutors, house cleaners, pet sitters, elder care workers, and tutors can post their jobs on this site. The ability to care for others can be achieved through a job that fits your schedule and enables you to make a living. 53. Rover There are several side-income opportunities for dog lovers with Rover’s services. A variety of options are available, including house-sitting, pet drop-ins, doggy daycare, walking dogs, and boarding pets. Taking care of some four-legged friends can bring in up to $1,000 per month. 54. Dolly As a Dolly Hand, you are responsible for lifting and carrying, while a Dolly Helper provides the vehicle (a truck or trailer). Whether it’s full-scale moves in town or store deliveries or transporting items to or from storage units, you can help. The hourly wage for a helper is $30, and the hourly wage for a hand is $15. 55. We Work Remotely We Work Remotely bills itself as the largest remote work community in the world. And, for good reason. It’s home to over 3M visitors a month, WWR is the leading destination for remote job listings. Here you can find everything from programming, graphic design, finance, and marketing jobs. In addition to freelance or part-time jobs, you can also use the site to land a full-time gig. Frequently Asked Questions How do people make money online, and why do they want to do it? The benefits of earning extra money online are numerous, and people are motivated to do so for many reasons. For example, some people want to make money online so that they have they can spend more time with their kids. Others want a side hustle to pay down debt. And, if you’re retired, it’s another income source, as well as preventing boredom. What is the best way to make money online? It depends on who you are, what your specialties are, and who your audience is. However, the above apps and websites are excellent places to get your feet wet. What is the timeframe for making money online? A number of factors play a role in that. This can, however, take anywhere from three months to three years. Are there any special skills or qualifications you need to make money online? Absolutely not. There is no special skill or qualification needed to make money online. There’s no shortage of lucrative jobs that can be found on the internet. A blog, an Amazon store, or freelance work are all viable options. If you used an app like Lyft, for example, you just need a newer vehicle and a clean driving record. Other apps, like Fatllama, just require you to have items that people wish to rent. Are you guaranteed to make money through apps and websites? In life, there are only two guarantees: death and taxes. Therefore, making money is not guaranteed. However, plenty of people have used the above sites and apps to make money. In some cases, it’s just a couple of hundred dollars here and there. For others, they’ve made thousands, if not millions. Article by Deanna Ritchie, Due About the Author Deanna Ritchie is a financial editor at Due. She has a degree in English Literature. She has written 1000+ articles on getting out of debt and mastering your finances. She has edited over 40,000 articles in her life. She has a passion for helping writers inspire others through their words. Deanna has also been an editor at Entrepreneur Magazine and ReadWrite......»»

Category: blogSource: valuewalkAug 24th, 2022

Transcript: Spencer Jakab

     The transcript from this week’s, MiB: Spencer Jakab on Reddit, Gamestop & Meme Stocks, is below. You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Stitcher, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here. ~~~ BARRY RITHOLTZ,… Read More The post Transcript: Spencer Jakab appeared first on The Big Picture.      The transcript from this week’s, MiB: Spencer Jakab on Reddit, Gamestop & Meme Stocks, is below. You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Stitcher, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here. ~~~ BARRY RITHOLTZ, HOST, MASTERS IN BUSINESS: I’m Barry Ritholtz. You’re listening to Masters in Business on Bloomberg Radio. My special guest this week is Spencer Jakab. He is an editor at The Wall Street Journal’s Heard on the Street column. Before that, he wrote the Ahead of the Tape column and was the Lex Column author for the Financial Times. He just wrote a new book “The Revolution That Wasn’t: GameStop, Reddit and the Fleecing of Small Investors.” Spencer Jacob, welcome to Bloomberg. SPENCER JAKAB, WRITER AND EDITOR, WALL STREET JOURNAL: Thank you. RITHOLTZ: So first of all, I really enjoyed the book. I read it on the beach this summer and a couple of weekends, really reads like a fascinating novel. If it wasn’t a work of nonfiction, it could never have been made into a work of fiction because it just wouldn’t be believable, would it? JAKAB: It’s crazy, right? It lends itself to a book and I knew that right away. When the story began to unfold, I sent an email. I had a three-quarters written book proposal about something else, sitting at home during the pandemic, and wrote an email to the Acquisitions editor at Penguin Random House, a person I don’t even know, didn’t know then. And when I saw this story begin to unfold, the first article had not been written about it. One of my sons brought to my attention — yeah? RITHOLTZ: Yeah. Let me stop you and just say the book came about, and please pardon my language, because your sons’ self-described themselves as degenerates, apes, and retards. Can you explain why a group of people would self-describe themselves that way? JAKAB: So I have three sons, and two of them are very online. They’re all online, but two of them are very online. They are on Reddit all the time, and they were on this forum on Reddit called WallStreetBets, which was at the epicenter of this story. And the people on this forum, it’s an investing forum but not really an investing forum. There’s a different investing forum on Reddit called r/Investing. This is r/WallStreetBets, which is an entirely different place. RITHOLTZ: Speculative, lots of axes to grind, lots of social issues come up. It’s not a straight-up investing group. JAKAB: No. It’s like Jackass for finance. What it is, it’s like, you know, you do crazy stuff on there, and you show off crazy stuff. And you — I don’t know if a lot of the crazy stuff actually ever happens because you can’t tell. People are using pseudonyms, but they were all over that. And my oldest boy, he’s now 23. He was a college senior when this happened, came over and he said, “Dad, are you going to write something about GameStop?” And so GameStop, they’re all into video games. I’ve driven them there lots of times. They were going there less and less over time, which is a problem with GameStop as a business. RITHOLTZ: Right. It’s, you know — it’s in a mall. It’s old school. It’s the blockbuster of video games. JAKAB: Totally. Totally. That’s the problem. That’s why it had been losing money for years. That’s why — that’s how it found itself at the center of the story. The book is not really about GameStop and people always ask me about “Don’t you think this? Don’t you think that about GameStop?” Like, I can talk to you about GameStop, but that’s not really the interesting thing here. RITHOLTZ: Right, right. JAKAB: The interesting thing is this unprecedented thing that made it the most traded security in the world for a while, the most searched term in the world for a while, you know, and from just total obscurity and I said, “No.” Why? You know, a friend of mine, this kid who I’ve known since he was, you know, as tall as my knee, had bought it. And I took a look and he’s doubled his money in the last two days, maybe he should sell. They’re talking about it on WallStreetBets. And I’ve seen this dozens of times before, you know, it’s a kind of a flash in the pan and — RITHOLTZ: Right. JAKAB: — I really wouldn’t hang on too long. And what kind of got my attention was he said, “No, he’s not going to sell ever. No, he can’t sell.” So what do you mean he can’t sell? And so, you know, I started reading the board, and I was like, “Oh, my God, they’re executing a corner on this stock.” So they all sort of agreed online to buy as much as they could, and not sell, and then buy options too, which forces further buying by options dealer. So it was this trap. It’s this thing that you can’t really do, as you know, Barry, like you can’t — RITHOLTZ: Not legally. JAKAB: Not legally. Right. RITHOLTZ: Like, you and I can’t get together and do this. But a bunch of anonymous teenagers and others, it wasn’t just teenagers, could talk about it in this venue without real fear of reprisal because they’re a bunch of little guys engaging in some speculative wishful thinking. JAKAB: That’s right. And if you take it at that point, there were about 1.9 million people on the forum. By the end of the next month, there were 11 million people. So they quadrupled in four days. The number of people in this forum is big, people got so excited by it. And so those people, individually, may not have had a lot of money, but they did two things. First of all, there are a lot of them. JAKAB: And they all rushed in, in the same way, into the same stocks, especially GameStop. And also, people were telling them, “Hey, if you want to get real bang for your buck, don’t even buy the stock, by way out of the money, call options on the stock RITHOLTZ: Right. JAKAB: And then the options dealers will have to basically, as it goes up, they’ll have to buy and they’ll buy a lot more than the money that you put down. RITHOLTZ: In professional terms, that’s a gamma squeeze. JAKAB: Yes, it’s a gamma squeeze. And most of these kids — well, very few of these kids know what a gamma squeeze was, but it was all explained there. I was reading all about it on the board. I don’t think they were breaking the law because they’re talking about it openly. RITHOLTZ: Right. Right. This was no dark conspiracy. So let’s talk a little bit about WallStreetBets. When it first started to erupt, I think the knee-jerk response, and I’m as guilty as anybody, was how is this any different than the 1990s in Yahoo message boards and Raging Bull? But there was a slightly different factor. What made this so different than what we saw 30 years ago? JAKAB: So you’ve heard it, it’s a cliche by now, but it is true, more or less, that “The four most dangerous words in investing are: this time it’s different,” right? And that’s something, I’m a real student of financial history. I was really — RITHOLTZ: John Templeton very famously said that. JAKAB: Totally. And I went into this, with that echoing in my head. I go into everything with that echoing in my head. Whenever there’s a crash, or mania or panic, that people — human psychology is basically unchanged since Paleolithic times. And so the way that we react to something financially is never good, but it’s always very similar. So history rhymes, it doesn’t repeat, but it rhymes. That’s the reason. It’s the way that our brains are wired. But this was different. And — RITHOLTZ: And tell us — tell us what was different about it. JAKAB: The difference is that private companies understand psychology too. They have psychologists who work for them. They have social psychologists who work for them. And the same people who you go into a Vegas casino. And there are no clocks on the wall, there are no windows, people are bringing you drinks. The same people who designed sports gambling apps and things like that, designed social media and designed brokerage apps that that these young people were using to access this. And they induced all kinds of — they just put these speculative tendencies on steroids basically, is what they did. Social media and the investing apps together on the same device, on your smartphone, being used by the same people together — RITHOLTZ: Along with — along with WallStreetBets and Reddit. JAKAB: Yeah. RITHOLTZ: So the difference — this time was different because — and to the fact that everybody is stuck at home. Most of us got stimulus checks, so people have cash in their pocket. And there’s no gambling, there’s no sports, their usual entertainment is shut down. This really seems — and you described it in the book as a perfect storm that just teed up to send this — to use their power lens to the moon. JAKAB: Yeah. I mean, it’s so interesting because several things had to happen really all at once, for this to happen. And so I traced that and explained the social forces, because I think that’s — I mean, that’s how you tell the whole story, and it’s very interesting, but it’s also how you understand what it means going forward. And I want them, you know — and I hope that there are lessons in the book for people who invest, people who invest their own money, people on Wall Street to take away from this, to understand how it happened. Not that it’s going to happen exactly this way again because, as I said, it was a perfect storm. But you have to go back to 2018 when you had sports gambling legalized outside of Vegas, in most of the U.S. RITHOLTZ: Right. JAKAB: And so you had all these young, mainly men, playing daily fantasy sports. They had the apps already, the FanDuel, DraftKings and what have you on their phones. And all of a sudden, they were actually gambling. There’s this legal distinction between daily fantasy sports and gambling-gambling. So it’s the only type of sports that negatively correlates with age is sports gambling. Then — RITHOLTZ: Oh, really? JAKAB: Totally. Everything else is — the older you are, the more likely you are to play slots and things like that, but not this. Then you had, in late 2019, so you had a five-year period when half of the new brokerage accounts opened in the U.S. were opened by Robinhood, which is a tiny broker, even though at this time. RITHOLTZ: Give that data point again, half of all new brokerage accounts were Robinhood/ JAKAB: Yeah. Not in dollar value because they were tiny, so the median value of those accounts was $241, which is peanuts. RITHOLTZ: Right. JAKAB: But the number of accounts, that’s something and I would love to go into what made Robinhood possible, okay, because there’s some changes there that you need to understand but — RITHOLTZ: So let’s explore that right now. Why was Robinhood — and PS, you know, I looked at Robinhood in 2014 in a seed round and I weighed. You want to give free trading to millennials? This is the single dumbest investing idea I’ve ever heard of. And I passed on it. What made that possible, Robinhood possible, where 20 years ago, you couldn’t have had the sort of app on your phone like Robinhood? JAKAB: Well, our mutual friend Howard Lindzon was one of the early investors in Robinhood. RITHOLTZ: He’s the one who pitched me on it. JAKAB: He was? Okay. And then so he — RITHOLTZ: Literally, Howard, that’s the dumbest, blank idea I’ve ever weighed. The trades are free, and you’re giving it to the least wealthy people in the world? How are they ever going to make money? JAKAB: It was Howard in video. He was kind of a dummy about it too because he was smart enough to invest. RITHOLTZ: Yeah. JAKAB: But then he was dumb enough to say, “Guys, this is a great app. You should charge like $1 or $2 for it, like people will pay that,” which was totally wrong because the fact that — and so — RITHOLTZ: You still had to link it to a bank account. JAKAB: Right. RITHOLTZ: But you could download it for free. And once you went through the process of opening the account, that’s when you found out they need this info, they need your phone number, they need that. JAKAB: Right. RITHOLTZ: They need your bank account. And before you know it, you’ve opened up your financial life completely to Robinhood. JAKAB: And your first brokerage account and it costs 75 bucks to get out, to sort of — you know, to move your account to somewhere else. RITHOLTZ: Well, you don’t — you don’t — JAKAB: So if you have $241, you know — yeah. RITHOLTZ: You liquidate it and move on. JAKAB: Exactly. Yeah, that’s — that would be the smarter thing to do, not that their customers always did the smarter thing, but we’ll get into that later, but yeah. So they — I mean, in late 2019, every other broker said, “Well, screw this. You know, we’re — if you can’t, you know, can’t beat them, then join them.” And for a Schwab or a Fidelity that has much wealthier customers, they sell all kinds of services that Robinhood doesn’t, they’re like, “Wow, we’re going to lose some money on this, but we have to match them.” RITHOLTZ: Right. JAKAB: And it shows you how dumb they were because they all were wringing their hands about cutting their commissions to zero. It was no longer the bulk of the money they made anyway. RITHOLTZ: Right. JAKAB: But it was still a pretty nice chunk of change for them. And they thought that it would cost them money, and it made them money because you had an explosion in trading activity as a result of everyone going to zero and so that — there’s a psychological concept that’s not appreciated. I mean, you have — you learn all about elasticity of demand, and you learned that when things get cheaper, people will desire more of it, but it depends what kind of thing it is. RITHOLTZ: And this is only up to a point. JAKAB: Only up to a point. But there’s a special kind of product where people — once you go from costing something, it doesn’t matter how little to nothing, but people will go crazy, they will explode, and that’s specifically fun thing. And so you don’t think about buying a stock as a fun thing, but Robinhood made it fun. RITHOLTZ: It’s the same dopamine hit as gambling or getting on a roller coaster, or just a little smidgen of heroin for the weekend. JAKAB: Totally. And it’s the same thing as think about when you’re a few years old, I mean, so you’ll remember like if you had to call somebody long distance, I mean, you know, my family, my parents are immigrants and we had, you know, relatives far away. And I remember like, you know, the very rare occasion they would spring for a phone call, like everyone had to be lined up next to the phone and you got your one minute on the phone and then hand the phone to the next person. And then it was like, oh, they’re tearing their hair about how much it would cost. Now, calling anyone in the world anywhere is free, and so people do it all the time. You know, they do it way, way more than if it just cost a tiny amount of money because there’s no cost to it. There’s no incremental cost to it. RITHOLTZ: Right. And as a note with Schwab, when they — and they were the first major broker that seemed to have introduced free trading, and then all the other dominoes fell after them. When you looked at their revenue the next quarter, I think something like 59% of their pre-free revenue came from just float on cash. JAKAB: Right. RITHOLTZ: And trading volume was really, really, you know, that high single digits, low double digits. And then eventually payment for order flow more than made that up so — and a lot of assets flowed into them. So all told, this was a win-win, at least, for established Wall Street firms. JAKAB: Yeah. And they were like, “Why did we wait so long to do this? This is great.” They were all, you know, just gushing about how smart they were to do this, even though they had held off on doing it for a while. That was late 2019. And then what happened in the early 2020 is you had the pandemic, and the pandemic was just the perfect thing to kick off the speculative excess. Of course, you know, you’d had free money for many years, basically. You know, you’d have zero — RITHOLTZ: You would, low cost credit, but literal free money showing up in the mail, in the form of a check or direct deposit that kicked in the second quarter of 2020. JAKAB: Yeah. If you were 23 years old and you had been, let’s say, working, maybe living with friends. All of a sudden, you’re in mom and dad’s basement. You get this check for 1,200 bucks. You might be getting extended unemployment benefits. You’re not spending money going out every night. You know, you’re at the age where you spend money as soon as you make it. All of a sudden, you weren’t. You’re bored. You’re sitting there looking at your phone for 12 hours a day. And you’re looking at social media. All of a sudden, all these new social media people are popping up, talking about stocks, the stock market, you know, this whole rise of influencers. And so you go in — you know, your buddy tells you to open up a Robinhood account. And you opened up a Robinhood account because he already has a Robinhood account. And he’ll get — he got a free share of stock when he opened it. And he’ll get another free share of stock. Mystery, it’s like a sweepstakes because it could be a $2 stock, but it could possibly be a $50 stock, right? RITHOLTZ: Right. JAKAB: You don’t know. It’s like a, you know — I mean, it’s like — RITHOLTZ: All told, that’s a cheap cost of acquisition for a brokerage firm, right? JAKAB: All told, the average payback period was five months for that investment. RITHOLTZ: That’s unbelievable. JAKAB: So they didn’t really need to — they did have advertisements. Their advertisers were really kind of to — kind of, you know, make themselves look good, basically. It wasn’t to get new customers. Their ads were all touchy feely, “You were born an investor. I never thought I could do this.” And the people they showed their ads are not the typical lucrative customers they had either. They were, you know, mainly female, a few older people. It was young males primarily. And the thing is most of their customers, they don’t make money on, but there’s a subset on which they make a lot of money. And so those are the people they’re trying to get. It was young, risk-seeking, you know, kind of maybe not two wise men. And as a father of three young men, I can — I know what I’m talking about. And you know, and so that’s when you had the explosion during the pandemic. And you had all this volatility which was just addictive. It was like crack cocaine, you know, you couldn’t stop. And then in the year from the pandemic bear market bottom to a year after, 96% of American stocks rose, which was crazy. RITHOLTZ: It’s huge. JAKAB: It’s unprecedented. RITHOLTZ: It’s a huge, huge number. (COMMERCIAL BREAK) RITHOLTZ: So let’s talk a little bit about the revolution that was and by using GameStop as an example, as you did so well in the book, and it has to begin with a guy whose name we now know as Keith Gill. Since this is a family station, I can only use an acronym, he went by DFV on Reddit. And on YouTube, he was Roaring Kitty. And he basically takes all of his money, some 50,000-something dollars, buys LEAPS like a year or two, off in the future, way out in the money. And this just looks like wild. So he buys calls, betting the stock will go up on GameStop, which is a couple of bucks, a buck or two, or three at that time. And he posts it without a whole lot of commentary on WallStreetBets on Reddit, just a picture of his brokerage account with the options there in his portfolio, apparently nothing else, and the phrase, “I like the stock.” JAKAB: Yeah, YOLO, you only live once. So he is a really, really fascinating character, an unusual character. And the one of the interesting things is — let me tell you that — I mean, of course, this whole history is there to be seen. But for 90% of this story, he’s there in the background, doing these videos, four-hour, five-hour long, you know, videos, talking about the stock and talking about investing, making these posts, responding to people who mainly made fun of him on his message board, like a lot — he took a lot of heat. And you know, he was — he was unusual in a lot of ways on this forum WallStreetBets. One thing is he wrote in complete sentences. The other is like he was — I mean, you might not think it’s — RITHOLTZ: He didn’t advocate people go out and buy it. He just said, “I like the stock.” JAKAB: Yeah. Right. RITHOLTZ: Basically, as much as — as much influencing as he did was “Here’s a picture of my account. I’m going to live and die on it. You guys go do you want.” JAKAB: You want a textbook example of not — how not to influence people online. RITHOLTZ: Right. JAKAB: And that’s it. Because he was cerebral, he was polite. You know, people would kind of make fun of him. He said, “Well, that’s not the way I think about it because, you know, behavioral finance dictates that blah, blah, blah. And as I follow the teachings of Aswath Damodaran,” whatever, like, you know, stuff like that. RITHOLTZ: Yeah. No one knows NYU. JAKAB: Yeah, exactly. The valuation guru at NYU. None of these kids know who that was, you know, right? RITHOLTZ: Right. JAKAB: I mean, and so he was just basically sort of — you know, it was like a tree falling in the woods. I mean, some people were like — you know, sometimes he would make money and then say, “Hey, you should sell.” I’m like, “No, no. no.” And then he’d lose half of it. And people who were following said, “Wow, what an idiot. You know, for the money that you lost, I could have done this and that. You could have bought a GameStop franchise.” Yeah. So he invested $53,000 of his money. He’s not a rich guy at all. He was working — he didn’t say anything about himself, by the way. And he was — and I think had he said this, he probably would have had less influence, he’s a chartered financial analyst, which was a difficult qualification to get. RITHOLTZ: CFA. Sure. One, two and three have — each have like a 50-something percent fail rate. JAKAB: Yeah. RITHOLTZ: So he’s in the industry. And then being smart and hardworking is always good. but getting a little lucky is better. And not long afterwards, along comes Michael Burry of “The Big Short” fame and basically takes a position in GameStop saying, “Hey, you know, this is a classic cigar butt. There’s some value here and there’s way too much negativity about it.” What happens from there? JAKAB: Well, I’ll tell you, this is interesting too because I won’t say the entire name, but DFV is Deep Effing Value. So value is part of his moniker. And he was upset, he said, you know, “Thanks a lot, Burry, for jacking up my cost basis,” because — RITHOLTZ: I can’t buy more. JAKAB: Well, he said, “Now it’s going to be more expensive to buy more.” Thanks for nothing. RITHOLTZ: Right. You would build the position over a couple of years. The technical term is pyramiding. You keep adding to an existing position as prices gradually rise, but they practically doubled overnight. JAKAB: Right. And he — and most people, I mean, 99.9% of people on this board would be like — RITHOLTZ: Especially option traders. JAKAB: — “I bought these options and, like, now doubled my money, you know, because the stock went up, because Michael Burry shows up, who was played by Christian Bale. That’s why most people think of Christian — RITHOLTZ: Right. JAKAB: — the picture of Christian Bale instead of Michael Burry himself. RITHOLTZ: At the drum set in “The Big Short.” JAKAB: Yeah. Totally. And so — and people are like, “What’s wrong with you? Like, you should sell.” Like, you know, he — this is like a stroke of luck. And it’s not how he viewed it at all, which is a very rare form of thinking. So he — I think like — RITHOLTZ: He was surprisingly long time for someone buying options. JAKAB: Totally. And I think — I would not be surprised if this guy shows up one day, five years, 10 years, maybe not even that long, you know, managing some kind of value fund, just sort of like a kind of a hip Warren Buffett or something, because he really — he has that way of thinking. First of all, obviously, he has analytical chops by having had a CFA — RITHOLTZ: Right. JAKAB: — maybe not Buffett-like, but he certainly knows what he’s talking about. But he just has that kind of unusual way of looking at things and inverting things that you need for success. But at the same time, as we’ll see later, he’s got that — you know, he’s cool and young. And he was 33, 34 during this episode. And the point at which he became really super influential, one of the most followed people on the planet, basically, for a couple of weeks, he wasn’t posting any kind of analysis. You know, he was like — he became the hero briefly of this whole movement. RITHOLTZ: So following Michael Burry, not much longer than that, Ryan Cohen, who is the founder of Chewy, which essentially is the most successful online pet food and goods store, essentially what couldn’t do, Chewy became. And Ryan Cohen then says, “Hey, we think GameStop can become an online purveyor of video games. Forget the brick-and-mortar, that’s just where they were. Let’s talk about the future.” And now, the stock takes another leg up from $1 and $2and $3 to $5 and $10. Tell us what happens next. JAKAB: Yeah. So he shows up, and then things start to get interesting. It starts going up to the point that it was at the point that Deep Effing Value would have sold. You know, he said, like, “I think, you know, this” — he had made enough money, he was a millionaire. RITHOLTZ: Right. On paper. JAKAB: Just a million, just 1 million, 1 million then 2 million, a couple of million, no big deal and life-changing money for him. RITHOLTZ: Before taxes? JAKAB: Exactly. Before taxes. But then a light bulb goes off. And even before this, a light bulb kind of went off in his head, some months before, because someone had pointed out on this board, like, “Hey, this could be the greatest short squeeze of your life.” RITHOLTZ: The mother of all short squeeze. JAKAB: The mother of all short squeezes, you know, the kind of the Saddam language. RITHOLTZ: Yeah. JAKAB: And it briefly doubled, and then settled back down. But that was a foretaste and that’s the first time he mentioned like, “Hey, in addition to all the good stuff I think about GameStop, there’s this additional possibility, I’m not going to really count on it, there could be a short squeeze.” Because, you know, the thing that GameStop and the other, they call the meme stocks, you know, had in common was that they’re all kind of losers. They weren’t — RITHOLTZ: AMC, the big movie chain, which was dying on the vine during the pandemic; Hertz, which had already declared bankruptcy and was waiting for the court to just dole out the assets, which is insane. What were some of the other ones that — JAKAB: Blackberry, remember those? RITHOLTZ: That’s right. Nokia was another one that popped up. JAKAB: Yes. RITHOLTZ: Like, we used to call — JAKAB: Bed Bath & Beyond. RITHOLTZ: We used to call that dumpster diving, when you’re looking through the wreckage on Wall Street to find that cigar stub, what can I still smoke that someone else has thrown away? JAKAB: And 2020 was possibly the worst year ever for short sellers, for people who bet that stocks are going to decline, usually by borrowing the stock and selling it. So basically, they opened themselves up to unlimited losses, in theory, and limited gains. And so 2020 was a terrible year. You had all kinds of dumb stuff going up, that they were betting against, Nikola and you know, I can go on and on and on about them. RITHOLTZ: So let’s put — let’s put some flesh on those bones, and this is data from the book. In the 2020 market, we saw a 34% drop. And then beginning on March 25th, markets rallied to finish up more than 20% for the year. And during that year, short sellers lost collectively $245 billion, which is pretty astounding. But then when you look at the three months leading into January 2021, when the meme stocks really exploded, a basket of the 50 most shorted stocks that had a market cap of at least a billion dollars, that basket doubled. Those are some insane stats if you’re a short seller. JAKAB: Yeah. That is just a world of pain if you’re a short seller. And so think about it, if you’re — I mean, there are people out there, Jim Chanos and what have you, who are dedicated short sellers. There are a lot more people out there who have short selling as part of their strategy. That’s the bulk of short selling, RITHOLTZ: Right. Some people just find bad companies to bet against them. Others run what’s called like 130-30, a long/short portfolio, where you’re 130% long and then 30% short. So net, you’re 100% long, but you have a hedge if the market goes down. And you bet that, the worst stocks will fall more than the best stocks. JAKAB: Totally. And that’s usually a smart bet because usually you don’t worry about something terrible happening to you, being ruined, right? I mean, you don’t think “What’s the worst thing that’s going to happen?” Then you bet against GameStop. And let’s say somebody shows — the best buyer shows up and buys it — RITHOLTZ: Pays double. JAKAB: Pays double. Okay. You had a really bad day. RITHOLTZ: (Inaudible), right? JAKAB: Right. You got a terrible day, but that’s it. Not a terrible day, but you had a bad day. It’s probably some small part of your — RITHOLTZ: Right. JAKAB: — huge portfolio. And so what these meme stocks had in common was that they’re all losers like that. They’re all companies that have not made money in years, were headed for bet possible bankruptcy, were sort of just anachronisms like Blackberry. They’re the companies, like in 2001, were sort of hot, not in 2021, right? And so, they were in a horrible year for short selling, they felt safe betting against these companies, but they felt too safe. And that was the kind of the dry kindling that started this fire was that they felt so safe betting against some of these companies, that their short positions left them no exit if things really went wrong. But no one — as we said, at the beginning of the show, it’s not like you and I, it would be illegal for us to gang up and say, “Hey, I happen to know that XYZ hedge fund is very heavily short this thing. And we can ambush him by basically colluding, putting all our money together, and pushing it, you know, to the moon.” But because then he would be forced to buy back, then his money — he would pile his buying on top of ours to buy back the stock, and then there’ll be a stampede for the sort of — it’s like shouting fire in a crowded theater. RITHOLTZ: Right. JAKAB: Short squeezes happen all the time, but you don’t — like those ambushes, they used to happen before there was an SEC. Now, you can’t do that. RITHOLTZ: So again, more data points, you know, a normal stock, a billion dollar-plus stock might have a short interest of 10% or 20%. If that gets up to 30%, 40%, 50%, that’s called a crowded short, “Hey, too many people are betting against it.” Some of these small cap and micro-cap stocks had shortest interests of 80%, 90%, 100%. GameStop had a short interest of 140%. This was a lot of dry kindling and people lighting sparks, wasn’t it? JAKAB: It totally was. I mean, 140% of the float. And people — and of course, there are ongoing sort of, you know, complaints and conspiracy theories, like that’s illegal. You can’t — you know, it is not illegal because there’s a process called rehypothecation, where if you — you know, if you go in the market today and you buy a stock, and then it’s in your account at Schwab or whatever, Schwab might lend that stock out even if you purchase that stock from a short seller. They don’t know where it came from. So — RITHOLTZ: Right. A stock can rehypothecate that and — RITHOLTZ: Right. Right. It could be lent twice or three times. It happens. RITHOLTZ: Right. There’s no ceiling on the amount of short interest other than, hey, at 200% or 300%, you know, it’s financial suicide. At a 100%, there’s no room for error — JAKAB: No, no. RITHOLTZ: — you know, as we clearly saw. So let’s talk a little bit about short selling, and what’s good and bad about it. But I got to start by asking about a story you tell about the history of the paperwork crisis on Wall Street, and how does that relate to what’s going on with Reddit and GameStop, and the meme stocks? Tell us about the paperwork crisis. JAKAB: Sure. Well, there’s a great book by John Brooks called “The Go-Go Years,” where I think I first heard about that. I’ve read about it in other places, too. But the paperwork crisis was something that happened during a previous speculative mania in the late 1960s, when you had just an explosion in trading activity. And this was before things were computerized. RITHOLTZ: Right. JAKAB: There was so much paperwork, in fact, that the stock market had to be for a long, long time closed on Wednesdays, just in order to allow people to catch up, you know, settling all the trades and making — RITHOLTZ: This was the Nifty Fifty era and a lot of stocks. The postwar bull market was still running from, you know, the late ‘40s right up to the mid ‘60s. Wall Street was hot. JAKAB: Wall Street was hot. And that was at a time that it was really expensive to trade, which is the — that’s the reason that I — one reason that I brought it up because it wasn’t until 1975 that commissions were deregulated. So for years and years and years, this is a complaint saying that, like, brokers could charge fixed commissions, and it was just really expensive for brokers to help themselves to your money, basically, on Wall Street. RITHOLTZ: Right. JAKAB: So you know, all these people who were involved in this never could have been involved because the hurdle, financially, to get into trading was just too high, and then you couldn’t be hyperactive, and even then people were hyperactive. Then when you brought commissions down, and down and down, you know, you had dot-com and whatever, and then — you know, then now you had this, which was — RITHOLTZ: That was $8 tradings down to — now to free. JAKAB: Down to free, that kind of makes it a little bit easier for there to be a speculative mania. And so, that was just kind of part of the kind of long arc of history on Wall Street that I tell, and yeah, and so making it free. You really crossed the Rubicon, but even making it cheaper made things easier. Of course, it’s made cheaper in the middle of the worst decade ever really, except the 1930s. For Wall Street, 1975 was a terrible time. You know, if you had gone to like these brokers with like, you know, sideburns and white ties and polyester suits and stuff in 1975, who were like having a terrible time financially in 1975, and you’re like, “Oh, this is the first step in, you know, this kind of revolution.?.....»»

Category: blogSource: TheBigPictureJul 12th, 2022

AT&T’s CEO John Stankey Is Facing the Most Challenging Time of His Career

Even iconic companies can endure a grueling identity crisis. AT&T has long been one of the most respected names in corporate America. Many Fortune 100 companies rely on the telecom giant for vital communications infrastructure and it is a leading provider of wireless phone service for consumers, including 5G. It’s a fast emerging player in… Even iconic companies can endure a grueling identity crisis. AT&T has long been one of the most respected names in corporate America. Many Fortune 100 companies rely on the telecom giant for vital communications infrastructure and it is a leading provider of wireless phone service for consumers, including 5G. It’s a fast emerging player in broadband with a high-quality fiber offering. It is routinely one of the most significant annual investors of capital in the U.S., investing more than $135 billion in its networks and spectrum over the past five years, according to company sources. Yet for the past six years, AT&T has been on a costly and distracting foray into the media business, gobbling up DirectTV and Time Warner in huge acquisitions. The company is now back to its core business of connecting businesses and consumers to each other. The consensus view on Wall Street is that AT&T has spent the last two years undoing what it did in the previous six. It has spun off DirectTV and Warner Media to refocus on building on the telecom infrastructure that is the backbone of much of the modern connected economy. [time-brightcove not-tgx=”true”] Directing this effort is the CEO since 2020, John Stankey, who has spent his entire 37-year career at the company. For Stankey, 59, it’s been a challenging and sometimes emotional process. In a recent interview, Stankey, made the case for the streamlined AT&T and discussed what he says is the most challenging business environment of his career. Stankey spoke to TIME on June 1, from a conference room outside his Dallas office, where he was testing out a new Microsoft video conference camera that slowly moved to focus on whoever was speaking. “I refer to us as Microsoft’s biggest beta tester.” (For coverage of the future of work, visit and sign up for the free Charter newsletter.) This interview has been condensed and edited for clarity. When was the last time that you used an actual landline? I’m probably a bit of an outlier. There is still one in the house and my mother-in-law calls the landline first. My wife and my mother-in-law are active users of it. I sometimes have to pick it up. How many customers still have landlines? It’s a very small number, less than 20% of our peak. My landline is $10 or $12 a month. Are you losing money on the landline business? Ten dollars does not cover the cost of the landline. Costs of landlines are going up because scale has gone down and the fixed cost structure largely hasn’t changed. When I talk about transforming the business, and altering the cost structure, a major part of that work is shedding all that cost structure associated with excellent, great products for many, many decades that have now run their course. All that cost structure is being re-engineered out of the business right now. And our hope is over the next four or five years, we free ourselves of that. Why has buying entertainment companies proved to be such a minefield for outside companies? Every industry has unique characteristics. I think some of the unique characteristics of the media business are incentive structures that are quite a bit different than many publicly traded operations. The incentive structure is very much built around the contributions of an individual or individuals as opposed to inherent value that the corporation owns or builds. Are you referring to the stars or directors taking a huge cut of a movie or hit show? It’s not just stars and directors. It’s people who write and showrunners; it’s executive producers who bring packages and talent together. Everybody kind of has a different dynamic around how they can sell and that is very different than many other businesses and verticals. I’m not talking about the cut per say, but what I am suggesting is that a company that has management expertise in their current line of business maybe struggles a little bit when you motivate and incent people in the media industry. It’s just utterly different and very, very unique and bespoke to a particular individual or particular individual’s capabilities. Right after the deal was announced you paid a visit to HBO headquarters in New York. The meeting was leaked to the press and you were presented in an unflattering light as a sort of clueless telcom guy that didn’t really get the creative business. Is the entertainment industry more of a snake pit than the telco industry? I think they just are motivated differently. It’s natural for me to walk into a group of 200 people in the communications business and talk about what we need to do to get perfect broadband out to millions and millions of people. It certainly isn’t going to be the kind of an approach that works in media. It’s all about being unique and special and different and your own intellectual property. I don’t find it to be a snake pit. I found it to be a different creative process with people who are incented and motivated differently. A lot of what you laid out that day for HBO and got so much blowback about, like increasing volume and production, has paid off. HBO added something like 3 million customers in the last quarter. If I were to be criticized for anything I did that day, it is that I told the truth. HBO is now for the first time in over a decade growing subscribers, growing in relationships, growing the number of hours that people spend watching the service and it’s not lost any of its creative edge. I think that’s pretty damn good. And now there is advertising on HBO. (And Netflix recently confirmed that it is working on adding an ad-supported optioned to its streaming service.) There are some customers who choose to pay less per month to get served advertising or a light advertising load and I think that’s probably a good thing because not everybody is wealthy, white-collar upper-middle class, and sometimes people want to pay a little bit less. (For coverage of the future of work, visit and sign up for the free Charter newsletter.) On a macro basis what is your reading of the health of consumers right now? Is it still your view that people are a bit flush? There’s still an awful lot of money sitting in people’s bank accounts from what I would consider to be some of the government-subsidized distributions that took place and changed people’s cash position. I do think consumers are still relatively healthy but it only takes a couple of quarters of 8% of inflation…[to eat into those cushions.] We’re going to see a softening of the economy that’s going to be driven by the fact that people aren’t going to have discretionary money and that softening will probably cause the economy to slow down. You will probably see things kind of normalize on jobs and employment. What is your operating assumption for inflation going forward? Six percent for the balance of this year, We may be in a position by this time next year where the Fed is successful in halving the current rate of inflation AT&T buys a lot of stuff. Where have you been hit the hardest in supply chain issues and shortages? Anything that has chips in it. What else? We deploy backup generator cell sites so when the power goes out, the power stays on for cell sites. The manufacturer we were working with ran out of a small plastic silicon part. It cost about a buck. Everything else is there: engines, transfer switches, and here’s one thing and it holds up a $30,000 generator because you can’t get that one little plastic $1 product. Have you readjusted wages in this tight job market? Our annual pay increases this year are at a level that I haven’t seen in the better part of a decade. In some of our tech disciplines, we did some fairly sizable, double-digit base adjustments to deal with the dynamics of the market. Do you think the current restrictive immigration policy has contributed to the labor crisis? Do I think a more informed immigration policy would be good for the United States? Yes, I do. What the pandemic taught us is that there’s an awful lot of work that can be done from any place and that companies are learning to run much more distributed operations. If that’s the case, if we can’t bring the workers to us, that would really not be healthy for the United States [because well-paying jobs will go to remote workers overseas who would prefer to be in the U.S. and could be contributing to the U.S. economy and communities.] With the variety of challenges—inflation, labor, supply chain—can you recall a more challenging environment for a business to operate in your career? No. My timing was impeccable. I walked into this job with a pandemic and a high degree of social unrest. You forgot that in your list. We still have a more polarized society on social issues than we’ve ever had; a supply chain that is as fragile and as broken as it’s ever been; a policy that has driven record levels of inflation; the oddest job market I’ve ever seen in terms of people’s motivation. I’ve never operated in this dynamic an environment. And right now we got war thrown in on top of that. How is your fiber business and the competition with cable going? I used to go to cocktail parties and the question was, ‘Why can’t I have better wireless service in my house?’ Now the question is, ‘When do I get fiber in my house? I hear it’s really good.’ We’re building as fast as we can. The issue is how fast we can build to address a market that is incredibly receptive. You refer to this time as the Golden Age of Connectivity and you are investing heavily in your networks. You project a five-fold increase in data over your network over the next five years. What’s going to drive that? That’s a very conservative view of what’s likely to happen. Case in point: the day after you get your 5G phone you use nearly 40% more data than you use the day before. Why is that? Because it’s faster, you wait less, you surf more. It wasn’t some killer application that drove it. What happens if Mark Zuckerberg is successful building the metaverse? What happens if that window of autonomous vehicles emerges and we need to pull data down to truly become self-driving, shared-use vehicles? Those kinds of things could impact that forecast only upwards. What happens if remote medical imaging takes off? All these things are all in play right now. What services will consumers be paying for in five years that they don’t pay for now? Well, that’s a hard question. If regulations change where the consumer isn’t the product that list could be very long. I believe Europe is going to do some things that will probably make privacy a higher priority. I suspect there will be some structural changes in how people ultimately price products and services and you may have to pay 30 cents a month for an email account in a market that is a little bit more protective of privacy. For your company, what is the single most challenging technical problem you’re trying to solve in the near term? We as a company have to get really good at writing software that allows our network to do better things for you. You recently sported a new look, a new hairstyle. Tell us about that. I made a bet with the company earlier that if they delivered the financial plan for the year I would shave my head. They had a great financial year and I shaved my head in January and was a chrome dome for a period of time. The temperatures are back up to 90-plus degrees here in Dallas. I’m thinking of taking it off again this weekend. Correction: June 27, 2022 The original version of this story misstated John Stankey’s age. He is 59, not 60......»»

Category: topSource: timeJun 28th, 2022

Disney Plus: All your questions answered about Disney"s on-demand streaming service

Disney Plus is a subscription streaming service with tons of Disney movies and shows. Here's a breakdown of pricing, plans, features, and content. Prices are accurate at the time of publication.When you buy through our links, Insider may earn an affiliate commission. Learn more.Alyssa Powell/Business Insider Disney Plus lets subscribers stream movies and shows from Disney, Pixar, Marvel, and more. The service costs $8/month or $80/year, and bundles with Hulu and ESPN+ start at $14/month.   A cheaper Disney Plus subscription with commercials is expected to launch in late 2022. Disney Plus Monthly Subscription Service$7.99 FROM DISNEY+Disney Plus is a streaming service with a huge library of on-demand shows and movies from Disney's many brands. Since November 2019, the service has amassed more than 130 million subscribers.Disney Plus includes a mix of content from Disney's vault and new programs developed exclusively for members. Subscribers can watch the studio's animated films, new Pixar movies, and titles from "Star Wars" and Marvel franchises. Big-screen releases like "Doctor Strange in the Multiverse of Madness" also stream on the service after they play in theaters.Subscriptions start at $8 a month for ad-free streaming. Disney Plus can also be bundled with Hulu and ESPN+ for a starting price of $14 a month. In March, Disney announced it will add a cheaper subscription plan with commercials in late 2022.Below, we detail everything you need to know about Disney Plus to help you decide if the service is right for your streaming needs.What is Disney Plus? Disney Plus is an on-demand streaming service created by The Walt Disney Company.With Disney Plus, subscribers can watch thousands of Disney movies and series on their devices (smart TVs, phones, laptops, tablets, and gaming consoles). The service includes unlimited downloads so you can watch anywhere, anytime. Disney Plus content comes from Walt Disney Studios' and Walt Disney Television's biggest names: Disney, Pixar, Marvel, Star Wars, National Geographic, and 20th Century Studios (formerly 20th Century Fox). How much does Disney Plus cost? Disney Plus costs $8 a month or $80 per year. With a subscription, you get ad-free access to all of the service's streaming titles. Disney Plus does not currently offer a free trial.Disney Plus Monthly Subscription Service$7.99 FROM DISNEY+There's also an option to buy a bundled package with Hulu and ESPN+, which costs $14 a month for all three services. Individually, ESPN+ and the ad-supported version of Hulu each cost $7 a month. Subscribing to the bundle saves you about $8 a month.Disney+ Hulu, Disney+, ESPN+ Bundle Monthly Subscription$13.99 FROM DISNEY+The Disney bundle is also automatically included if you subscribe to any of Hulu's live TV plans. Hulu + Live TV offers access to over 75 channels. Hulu (with ads) + Live TV with Disney Plus and ESPN Plus costs $70 a month. Hulu + Live TV$69.99 FROM HULUYou can read more about how to get the Disney Plus bundle with ESPN+ and the different versions of Hulu here.Does Disney Plus have an ad-supported plan?In March, Disney announced plans to offer an ad-supported Disney Plus subscription at a lower price. The ad-supported plan will launch in the US in late 2022 but a price hasn't been revealed.The ad-supported plan will roll out to international markets in 2023.How do I sign up for Disney Plus?You can sign up for Disney Plus directly through the Disney Plus website. To start streaming, you simply need to create an account by entering an email address and payment method.  Where is Disney Plus available?Disney Plus is now live and available to stream in the US, Canada, the Netherlands, Austria, Germany, Italy, Spain, Switzerland, France, India, Belgium, Denmark, Iceland, Finland, Norway, Portugal, Sweden, United Kingdom, Ireland, Isle of Man, Monaco, Wallis and Futuna, French West Indies, French Guiana, New Caledonia, Japan, Indonesia, Latin America, Réunion, Mayotte, Mauritius, Singapore, Hong Kong, Taiwan, and South Korea.Are there Disney Plus gift cards? Yes. If you're looking for a great gift for that special Disney fan in your life, you can get them a Disney Plus gift subscription for $80. The gift subscription is available for new members only, and includes one year of the streaming service. Disney Plus Gift Subscription$79.99 FROM DISNEY+Learn more about how to buy a Disney Plus gift subscription. What features and formats are supported on Disney Plus?Disney Plus includes several features that make using the service more convenient:The platform supports up to seven profiles per subscription.A special kids profile can be used to restrict streaming to titles that are rated TV-7FV and G.Disney Plus allows simultaneous streaming on up to four different devices.Unlimited downloads are provided via the Disney Plus app on up to 10 different smartphones and tablets. You can watch Disney Plus with up to six friends using the GroupWatch feature. Disney Plus supports up to 4K resolution with high dynamic range (HDR), using the HDR10 or Dolby Vision formats.Dolby Digital surround sound and Dolby Atmos audio formats are supported on select programs.Select Marvel movies support IMAX Enhanced playback, which lets you see even more picture on screen.How to watch Disney PlusDisneyYou can watch Disney Plus through many connected devices:Desktop web browsersMobile devices and tablets (Android and Apple). Smart TVs (LG WebOS, Samsung Tizen, Android TV, Vizio SmartCast, Roku TV) Game consoles (PlayStation, Xbox) Streaming devices (Apple TV 4th Gen and later, Chromecast, Amazon Fire TV, Roku)What shows and movies can I watch on Disney Plus? Jedi Obi-Wan Kenobi clashes with Darth Vader in the Disney Plus original series "Obi-Wan Kenobi."Obi-Wan Kenobi / DisneyVirtually any Disney show or movie that's already been released is available to watch on Disney Plus.From classics like "Snow White" to recent hits like "Shang-Chi," the service features a huge library of titles to choose from across Disney, Pixar, Marvel, Star Wars, National Geographic, and 20th Century Studio brands. Disney Plus also includes original programming, like "The Mandalorian," "Obi-Wan Kenobi," "Hawkeye," and "Ms. Marvel."Disney Plus has exclusive musical content as well, including concert films from Taylor Swift and Billie Eilish, a film version of the Broadway show "Hamilton," and Beyonce's visual album "Black is King." Some of the services biggest new releases include Steven Spielberg's "West Side Story" and Pixar's "Turning Red." Marvel's "Doctor Strange in the Multiverse of Madness" will hit Disney Plus on June 22.You can find more information about specific Disney Plus shows and movies below:Disney Plus moviesDisney Plus showsDisney Plus Premier Access moviesMarvel movies and shows on Disney PlusStar Wars movies and shows on Disney PlusPixar movies on Disney PlusKids movies and shows on Disney PlusWho should sign up for Disney Plus?Disney Plus is an ideal service for Disney fans, whether they're Marvel geeks or animation aficionados. It's especially suitable for families with children who want to watch recent Disney movies and older Disney titles from the studio's vault.Though the lineup of original programming was a bit limited at launch, popular exclusives like "Obi-Wan Kenobi," "Loki" and "Ms. Marvel" continue to add value. Disney also removed its content from a lot of other services, including Netflix, so Disney Plus is now the only subscription streaming platform with access to many of its titles.  You can read our full Disney Plus review here for detailed impressions, as well as our Disney Plus review from a parent's perspective for specific thoughts on the platform's family-centric features. How does Disney Plus compare to other streaming services?While services such as Netflix and Amazon Prime Video feature a rotating mix of movies and TV shows from different studios, Disney Plus is focused entirely on Disney content.Walt Disney Studios and Walt Disney Television offer an iconic library of family friendly movies, shows, and documentaries, but the Disney Plus collection won't change much on a month to month basis.At $8 a month, it's very affordable compared to major competitors, and the discounted bundle with Hulu and ESPN+ adds even more value.Of all the major streaming services, it's also one of the most generous in the areas of multiple-device streaming, profile additions, downloads, and 4K playback. Some competitors, like HBO Max and Netflix, require subscribers to pay more to receive 4K support.On the downside, Disney's focus on family friendly programming might limit the service's appeal to adults. That said, this approach could be changing. Disney Plus updated its parental controls to accommodate more mature titles when it added Netflix's Marvel shows to its lineup on March 16.What is Disney Plus Day?"Shang-Chi" and "Jungle Cruise" are now available for all Disney Plus subscribers to stream.Disney PlusDisney Plus Day celebrates the anniversary of Disney Plus' launch with special announcements and new releases for subscribers. Disney Plus Day 2022 is set for September 8; a bit earlier than the last event held in November 2021.We don't know exactly what's in store for 2022, but last year's Disney Plus Day included the streaming premieres of "Jungle Cruise" and "Shang-Chi and the Legends of the Ten Rings," as well as two special events filled with trailers from Marvel and Pixar.Read the original article on Business Insider.....»»

Category: topSource: businessinsiderJun 8th, 2022

Data shows that movie piracy is up from 2021, but hasn"t hurt Hollywood"s biggest box-office hits this year

Movie studios have largely moved away from simultaneous releases, and piracy hasn't dramatically impacted the box office of films like "The Batman." Zendaya and Tom Holland in "Spider-Man: No Way Home."Sony Pictures Movies released simultaneously to theaters and streaming services last year were frequently pirated. Theater execs said that this impacted a movie's box office. Studios are moving away from the strategy, and piracy isn't rampant during a movie's theatrical run. Piracy ran rampant last year among some of Hollywood's biggest movie releases as studios debuted many simultaneously in theaters and on streaming services. Five months into 2022, the major studios have largely moved away from simultaneous releases, and in most cases are reaping the box-office rewards as their movies aren't being aggressively pirated as soon as they hit theaters.Theatrical industry leaders were adamant that "day-and-date" releases, as the simultaneous release model is called, made it easier for movies to be pirated, and thus ate into a movie's box office earnings.Some of the most pirated movies last year included:"Mortal Kombat" — premiered simultaneously in theaters and on HBO Max. It earned $42 million in the US and $84 million globally."Black Widow" — debuted simultaneously in theaters and on Disney+ Premier Access. It grossed $183 million in the US and $378 million worldwide."When a movie is released simultaneously to a streaming service, a pristine copy of that movie is made available day one that it's in cinemas," John Fithian, the CEO of the National Association of Theatre Owners (NATO), told Insider during an interview last year.At last month's CinemaCon, an annual conference where movie studios showcase their upcoming releases to exhibitors, Fithian reiterated this sentiment during a speech, saying that piracy spikes were "most drastic when a movie is first available to watch in the home."He then declared that day-and-date was "dead as a serious business model."That doesn't mean that movies aren't still facing piracy. According to Muso, a leading piracy insights company, visits to movie-piracy sites increased 42.5% in the first quarter of 2022 compared to the same period in 2021. But keep in mind that movie releases were slim in the early months of last year.Insider analyzed the most pirated movies of the year so far, according to the piracy tracking website Torrent Freak's weekly updates, and it's clear that the movies were pirated more once they were available online, either via streaming services or for digital rental.These days, that mainly means that movies can be easily pirated much sooner after their theatrical runs than they were before the pandemic. Studios have, for the most part, shortened the exclusive theatrical window. The pre-pandemic window was typically 75 days to 90 days. Now, 45 days is emerging as a new standard, though some movies will have shorter or longer windows than that.Theater execs Insider has spoken to say that an exclusive theatrical run can build momentum for a movie's eventual streaming debut. The data suggests that's the case for piracy, too, or at least that if a movie is a hit in theaters it could be popular on piracy sites, too. "Spider-Man: No Way Home" has topped Torrent Freak's weekly list of most pirated movies for four weeks this year, the most of any movie. It was also last year's highest-grossing movie at both the US and global box offices.After playing only in theaters for three months, the movie was made available on premium video-on-demand platforms like Prime Video and iTunes, at which point it immediately shot to the top of the weekly rankings.Similarly, "The Batman" increased in piracy once it was made available on HBO Max. During its 45-day theatrical run, it earned $369 million in the US and $768 million globally.It's not only box-office hits that see piracy spikes once they're available online. Movies like "Moonfall" and "Blacklight," which flopped in theaters, topped Torrent Freak's lists, too, just not as frequently as hits like "No Way Home."Muso noted in a recent report that its piracy data is "frequently used by customers to uncover hidden gems for content acquisition." In the case of "Blacklight," the report said that its popularity on piracy sites suggests a "bigger audience" for the movie than its box office suggested, making it a "strong acquisition target for VOD platforms."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderMay 20th, 2022

Futures Dead Cat Bounced As BTFDers Emerge On Turnaround Tuesday

Futures Dead Cat Bounced As BTFDers Emerge On Turnaround Tuesday The relentless rout that erased $3.4 trillion from the Nasdaq 100 in the past month paused on Turnaround Tuesday as battered tech valuations attracted scattered dip buyers, but nothing like the full-throttled BTFD buying parade observed in months gone by. Futures on the tech-heavy gauge advanced as much 1.4% as bargain hunters returned after the Nasdaq 100 slumped to the lowest since November 2020 on Monday, capping three days of major losses. S&P 500 futures were 0.7% higher to 4,016 after rising as much as 1.2% earlier but also after plunging to as low as 3,961. After rising as high as 3.20% on Monday, 10-year Treasury yields dropped for a second day, sliding below 3.0% and providing further relief to technology shares. The dollar erased a loss and Treasuries edged higher, signaling the return of some haven demand amid nervousness over the path of Federal Reserve policy. European bonds rallied. The Nasdaq’s 14-day relative-strength index (RSI) closed at 33 on Monday, getting closer to the level of 30, which to some analysts indicates a security is oversold and is poised to rise. Another sharp selloff “seems unlikely without an external trigger,” said Ulrich Urbahn, head of multi-asset strategy and research at Berenberg. “Nevertheless, as long as the problems persist, we do not expect a big recovery and have used the relief rally to move our equity exposure to neutral.” Indeed, traders have been caught between stubbornly high inflation that erodes asset values and central-bank tightening that threatens to slow economic growth, or even push some nations into recession. Recent U.S. data suggesting the Federal Reserve will stay on an aggressive rate-hike path have sparked the latest bout of risk-off trades. Fresh outbreaks of Covid in China, and the nation’s stringent measures to control them, have worsened sentiment. “For now, investors need to be prepared for continued volatility,” Solita Marcelli, Americas chief investment officer at UBS Global Wealth Management, wrote in a note. She added “sentiment is bearish” but not capitulating. In premarket trading, electric vehicle makers are up, with Tesla, Rivian and Lucid set to rebound after losing $188 billion in three days. AMC Entertainment is 6.4% higher after reporting better-than-expected quarterly results as hits like “Spider-Man: No Way Home” lured people back to movie theaters. Bank stocks edge higher in premarket trading amid a broader rebound for equity markets after Monday’s rout. S&P 500 futures are up about 0.8% this morning, while the U.S. 10-year yield retreats for a second day to sit at roughly 3%. In corporate news, BlackRock said it won’t support efforts by shareholders who try to micromanage companies on climate change. Meanwhile, Bitcoin rebounded back above $30,000 after briefly sinking below the closely watched level. Here are some of the biggest U.S. movers today: Most large cap U.S. technology and internet stocks rose in premarket trading, on course to recoup some of the heavy losses they suffered in a steep selloff over the last three sessions. Apple (AAPL US) is up 1.2%, Microsoft (MSFT US) +1.2% and Meta (FB US) +2.8%. AMC Entertainment (AMC US) is up 3.8% in premarket trading after reporting better-than-expected quarterly results as hits like “Spider-Man: No Way Home” lured people back to movie theaters. Electric vehicle makers Tesla (TSLA US), Rivian (RIVN US) and Lucid (LCID US) are rebounding after losing $188 billion in three days of heavy selling in technology and growth stocks. Shockwave Medical (SWAV US) may move after it raised its revenue guidance for the full year, with analysts saying that the company’s performance was boosted by its coronary business. Shares rose 11% in extended trading on Monday. Upstart Holdings (UPST US) shares plunge 48% in premarket trading after the cloud-based artificial intelligence lending platform cut full- year revenue guidance on macro uncertainties. Piper Sandler cut the stock to neutral. Novavax (NVAX US) is down 21% premarket, with analysts saying that the biotech firm’s revenue for the first quarter missed expectations. Plug Power (PLUG US) shares are 5.6% lower premarket after the fuel cell company reported net revenue for the first quarter that missed the average analyst estimate, with KeyBanc noting pressure on margins and higher costs. Video game stocks may move after Sony’s earnings fell short of estimates amid supply constraints and component shortages. Watch shares in Activision Blizzard (ATVI US), Electronic Arts (EA US) and Take-Two Interactive (TTWO US). U.S. stocks and particularly the Nasdaq 100 have been crushed this year (amid a tireless tirade from JPM's Marko Kolanovic to buy each and every dip) as investors fret over recession risks from the Federal Reserve embarking on aggressive monetary tightening amid surging inflation. Higher interest rates mean a bigger discount for the present value of future profits, hurting growth and in particular tech stocks with the highest valuations.  European stocks trade well, with most cash indexes gaining over 1% to recover roughly half of Monday’s losses when the index slumped to its lowest level in two months. Euro Stoxx 50 rose as much as 1.75%, FTSE MIB outperforms slightly, FTSE 100 lags but still adds 1%. Construction, banks and autos lead broad-based Stoxx 600 sectoral gains. The Stoxx 600 energy sub-index edges lower, being one of the worst-performing sectors in a rising broader market for European stocks, as oil keeps falling. Shell declines as much as 1.5%, TotalEnergies SE -1.6%, Equinor -4.5%. Here are some of the biggest European movers today: Luxury stocks such as Kering (+0.5%) and Watches of Switzerland (+4.2%) rebounded after the declines of the previous sessions, with investors hopeful that the Covid-19 situation in the key market of China may be slightly improving. Hermes rises as much as +1.6%, LVMH +2.4% Airbus gains as much as 3.7% in Paris trading after being raised to buy from hold at Societe Generale, with the broker highlighting the planned production ramp-up of the “highly profitable” A320 family. Swedish Match rises as much as 28% after Philip Morris International said it’s in talks to buy the company. While a deal would make strategic sense, a counter-bid can’t be ruled out, analysts said. Centrica climbs as much as 6.5%, the most since Feb. 25, after the company guided adjusted earnings per share to be at the top end of the consensus range. Euroapi soars as much as 9.5% after the Sanofi spinoff is initiated with a buy recommendation and EU20 price target at Deutsche Bank, which sees “good value” and an attractive business. E-commerce stocks rise in Europe, with many outperforming the benchmark Stoxx 600 Index, buoyed by dip buyers returning to growth and technology shares that have been battered this year. Zalando up as much as 4.9%, Home24 +12%, Moonpig +3.6% Earlier in the session, Asian stocks extended their decline to a seventh day as the specter of rapid credit tightening in the U.S. and protracted lockdowns in Chinese cities prompted some investors around the region to reduce holdings of riskier assets.  The MSCI Asia Pacific Index fell as much as 2.1% to its lowest level since July 2020, weighed down tech shares after a three-day selloff in the Nasdaq 100. Hong Kong’s Hang Seng Index ended 1.8% lower as the market reopened after a holiday, though benchmarks in mainland China rebounded from early-trading lows on hopes for easier monetary conditions. MSCI Asia Pacific Index down 0.7% Japan’s Topix index down 0.9%; Nikkei 225 down 0.6% Hong Kong’s Hang Seng Index down 1.8%; Hang Seng China Enterprises down 2.2%; Shanghai Composite up 1.1%; CSI 300 up 1.1% Taiwan’s Taiex index up 0.1% South Korea’s Kospi index down 0.5%; Kospi 200 down 0.5% Australia’s S&P/ASX 200 down 1%; New Zealand’s S&P/NZX 50 down 1.3% India’s S&P BSE Sensex Index down 0.2%; NSE Nifty 50 down 0.4% “There’s nowhere to escape so it’s pretty tough,” said Yuya Fukue, a trader at Rheos Capital Works. “Economic data appears to be deteriorating of late, though that has seemed to have gone little noticed while the markets were so focused on the Fed’s policy. It feels as if the game is changing.” Among Chinese tech giants, Alibaba tumbled 4.8% in Hong Kong, while Tencent dropped 2.3%. Regional declines were broad, with investors dumping even this year’s star energy shares as oil prices eased.  Singapore’s Straits Times Index and Australia’s S&P/ASX 200 both dropped about 1%. The Philippine benchmark ended 0.6% lower, recovering after skidding more than 3%, after Ferdinand Marcos Jr. won a landslide victory in the country’s presidential election. Mainland Chinese shares closed higher after the People’s Bank of China repeated a pledge to proactively address mounting economic pressure and highlighted a drop in deposit rates, which could spur banks to lower the cost of borrowing for the first time in months. “The market was a bit oversold. In addition, PBOC is also mentioning a drop in deposit rates, raising expectations of more room for banks to increase lending,” said Aw Hsi Lien, a strategist at Tokai Tokyo Research. India’s benchmark equity index slipped to a two-month low amid a weaker trend in Asia as surging oil prices and inflationary pressures weighed on investor sentiment. The S&P BSE Sensex fell 0.2% to 54,364.85 in Mumbai, after swinging between gains and losses several times during the session. The NSE Nifty 50 Index slipped 0.4% to 16,240.05. This is the third consecutive session of declines for the key indexes.  Sixteen of the 19 sector sub-indexes compiled by BSE Ltd. dropped, led by metal stocks. Reliance Industries Ltd. slipped 1.7% to a seven-week low and was the biggest drag on the Sensex, which saw 18 out of its 30 member-stocks trading lower.   In earnings, among the 27 Nifty 50 companies that have announced results so far, 10 have missed estimates while 17 either exceeded or met forecasts.  In FX, the Bloomberg Dollar Spot Index fell 0.1% after climbing to a two-year high on Monday, and the greenback was steady or weaker against all of its Group-of-10 peers. The euro consolidated and the region’s yields fell as Italian bonds led an advance. The pound was steady against both the dollar and euro while gilts outperformed peers. Domestic focus is on the Queen’s speech laying out the government’s agenda for the next parliamentary session and Brexit risks after reports the U.K. is preparing to scrap parts of the Northern Ireland protocol. U.K. retail sales are falling on an annual basis for the first time since the start of last year as the cost of living crisis crushes consumer confidence and puts the brakes on spending. Scandinavian currencies led gains among G-10 pairs after both currencies fell to the weakest level in around two years versus the dollar on Monday. The Australian and New Zealand dollars also bounced off two-year lows as stock indexes trimmed an intraday decline. Aussie’s gains were tempered as iron ore fell for a third day to bring the three-day slide to about 15%. The yen edged lower as Treasury yields recovered from a sharp overnight drop. Bonds pared earlier gain after the 10-year debt sale. Bank of Japan Executive Director Shinichi Uchida says that widening the central bank’s yield target band would be equivalent to a rate hike and wouldn’t be favorable for Japan’s economy In rates, Treasuries rose in early U.S. trading with belly leading gains and the curve flattening modestly after Monday’s bull-steepening. Yields are richer by ~4bp across in belly of the curve, steepening 5s30s spread by ~3bp as long-end yields lag; 10-year trading just around 3%, richer by ~3bp on the day, trailing gilts by ~7bp in the sector. Core European rates outperform led by gilts while stocks and U.S. futures recover a portion of Monday’s steep losses. Bunds bull-flatten, while peripheral spreads tightened to Germany with short-dated BTPs outperforming. Treasury auction cycle begins with 3-year note sale, and several Fed speakers are slated. U.S. new-issue auction cycle consists of $45b 3-year note, followed by 10- and 30-year sales Wednesday and Thursday. WI 3-year yield ~2.800% is higher than auction stops since 2018 and ~6bp cheaper than last month’s, which stopped through by 0.1bp. Three-month dollar Libor +0.13bp at 1.39986% In commodities, crude futures are choppy, WTI dips back into the red having stalled near $104. Spot gold rises ~$9 near $1,863/oz. Much of the base metals complex trades poorly. LME copper outperforms, holding in the green but off best levels after a test of $9,400/MT. Bitcoin reclaimed the $31K handle, but is yet to make a concerted move higher. Looking ahead, we get the April NFIB Small Business Optimism print (93.2, Exp. 92.9), Chinese M2, Speeches from Fed's Williams, Waller, Bostic, Barkin, Kashkari, Mester, ECB's de Guindos & BoE's Saunders, Supply from the US. Earnings from Norwegian Cruise Line & Warner Music. Biden speaks on soaring inflation at 11am EDT. Biden will also meet with Italian Prime Minister Draghi at the White House, and the UK state opening of Parliament is taking place, where the government outlines its legislative programme for the year ahead. Of course, the big event is tomorrow morning when the US CPI print comes. Market Snapshot S&P 500 futures up 1.1% to 4,031.75 STOXX Europe 600 up 1.2% to 422.32 MXAP down 0.8% to 159.98 MXAPJ down 0.8% to 523.71 Nikkei down 0.6% to 26,167.10 Topix down 0.9% to 1,862.38 Hang Seng Index down 1.8% to 19,633.69 Shanghai Composite up 1.1% to 3,035.84 Sensex up 0.4% to 54,674.30 Australia S&P/ASX 200 down 1.0% to 7,051.16 Kospi down 0.5% to 2,596.56 German 10Y yield little changed at 1.07% Euro little changed at $1.0564 Brent Futures up 0.8% to $106.83/bbl Gold spot up 0.5% to $1,862.69 U.S. Dollar Index little changed at 103.65 Top Overnight News from Bloomberg The EU is considering the issuance of joint debt to finance Ukraine’s long-term reconstruction, which may end up costing hundreds of billions of euros, according to an EU official familiar with the plan China’s provinces are set to sell a historic amount of new special bonds by the end of June as part of an infrastructure investment push intended to rescue an economy stymied by Covid outbreaks and lockdowns Hungarian Prime Minister Viktor Orban’s talks with the head of the EU about proposed sanctions on Russian oil imports made progress, but failed to reach a breakthrough, according to both sides Investor confidence in Germany’s pandemic rebound improved, but remained deeply negative as the war in Ukraine darkens the outlook for Europe’s largest economy. The ZEW institute’s gauge of expectations rose to -34.3 in May from -41 the previous month, defying expectations for a third straight deterioration. An index of current conditions worsened Saudi Arabia’s oil minister warned that spare capacity is decreasing in all sectors of the energy market, as prices of products from crude to diesel and natural gas trade at or near multi-year highs in the wake of Russia’s invasion of Ukraine A more detailed look at global markets courtesy of Newsquawk Asia-Pac stocks were mostly negative after the resumed sell-off on Wall St where the S&P 500 slipped beneath the 4,000 level for the first time since March 2021. ASX 200 briefly gave up the 7,000 status with notable underperformance in the energy and mining-related sectors. Nikkei 225 slumped from the open although moved off its lows as participants digested stronger than expected Household Spending data and after BoJ's Uchida dismissed the prospects of a tweak to the BoJ’s 50bps yield target band. Hang Seng and Shanghai Comp both initially joined in on the selling with heavy losses in the tech sector contributing to the underperformance in Hong Kong on return from the extended weekend, although the downside in the mainland was later reversed after the recent policy support efforts by China’s MIIT and CBIRC. Top Asian News China Tech Stocks Slide as Growth Woes, Global Rout Grip Traders Investor’s Guide to the 2022 Philippine Presidential Election ArcelorMittal Evaluating Bidding for ACC, Ambuja: ET Now Philippine Stocks Fall as Traders Weigh Marcos Win, Global Rout European equities feel some reprieve following the prior session’s selloff; Euro Stoxx 50 +1.2%. Relatively broad-based gains are seen across the majors with some mild underperformance in the FTSE 100. Sectors show some of the more defensive sectors at the bottom of the bunch – alongside energy – whilst Construction, Autos, Banks, and Industrial Goods reside as the current winners. US equity futures are firmer across the board, ES +1.0%, with the NQ narrowly outpacing peers after underperforming yesterday. Top European News Russian Gas Flows to Europe Remain Steady on Key Links Highest Inflation in Three Decades Boosts Czech Rate Hike Case BPER Banca Soars After Earnings Beat, With Fees as Highlight Russia’s Economy Facing Worst Contraction Since 1994 FX The Dollar retains a firm underlying bid ahead of another slew of Fed speakers; risk sentiment remains fluid and fragile. The Swiss Franc has hit a fresh 2022 peak vs the Greenback; USD/JPY is consolidating around 130.00. EUR/USD was unfazed by mixed German ZEW data but later lost ground under 1.0550. Cable rotates either side of 1.2350 awaiting Brexit/N. Ireland news, further political fallout and more comments from BoE hawk Saunders. Crude and commodity FX have gleaned a degree of traction from partial recoveries or stabilisation in underlying prices. CBRT and regulator have asked banks to undertake FX transactions with corporate clients between 10:00-16:00, when the market is liquid, via Reuters citing bankers. Fixed Income Core benchmarks bounce further after a brief breather early on, with little in way of fresh fundamentals behind the upside. Initial highs were faded pre-UK/German issuance; once this cleared, Bunds and Gilts lifted to 152.50+ and 119.00+ peaks. Stateside, USTs are bolstered but far from best, with the curve re-flattening into today's 3yr sale and yet more Fed speak. Commodities Crude futures have come under renewed pressure in recent trade after seeing some gains in the European morning.   The initial downside coincided with the mixed Germany ZEW reports alongside the downbeat commentary from Hungary regarding an imminent oil ban; albeit, benchmarks are off overnight USD 100.44/bbl and USD 103.19/bbl respective lows. Saudi Energy Minister says it is "mind-boggling" why focus is on high oil prices and not on gasoline, diesel or others. World needs to wake up to an existing reality that it is running out of energy capacity at all levels, via Reuters. UAE Energy Minister says oil prices could double or triple in "chaotic" market. US officials reportedly asked Brazil's Petrobras in March to boost output, but it the oil Co. said it could not, according to Reuters sources. China's Shenghong Petrochemical has started a trial operation at its (320k BPD) greenfield refining complex in east China, according to Reuters sources. Germany is said to be shifting away from plans for a strategic national coal reserve, according sources cited by Reuters. Spot gold holds onto mild gains as DXY pulled back from the fresh YTD highs set yesterday. LME futures post mild gains following yesterday’s downside with the market still looking somewhat fragile. DB's Jim Reid concludes the overnight wrap It's school photo day today. After discussing it with my kids last night I said to them that I'd dig out my old school photos so they could see me at school. Without hesitation and with a straight face Maisie said, "Are they in black and white Daddy?". I was half amused and half depressed. Markets are pretty black at the moment with little white on show. Actually the only bright colour is a sea of red. Indeed after a rocky few weeks in markets, there’s been a further rout over the last 24 hours as investor jitters about the global growth outlook have continued to escalate. There has been some respite in Asia but markets remain very shaky. There wasn’t really a single catalyst to yesterday’s steep declines, but ultimately there’s been a growing scepticism in markets as to whether the Fed and other central banks will actually be able to achieve a soft landing without a recession as they seek to bring down inflation. One interesting development though was that rates rallied as the equity slump intensified, rather than both selling off as has been the norm in recent weeks. Although the day lacked a single catalyst, the bond market moves seem to turn around the same time as Atlanta Fed President Bostic spoke. He picked up where Chair Powell left things after last week’s press conference. Bostic signaled that +50bp hikes were part of his core view, placing low odds on anything larger, stating +50bp hikes were “already a pretty aggressive move.” Like other Fed speakers, he signaled a desire to get policy to neutral and then assess. While he isn’t a voter this year, his voice does carry weight at the hawkish end of the committee so the price action likely reflected the market believing that a consensus continues to build for 50bps, and not 75bps, even among the hawks. Sovereign bonds were actually seeing a strong sell-off before his comments but rallied fairly fiercely from around the same time. 10yr Treasury yields hit an intraday high of 3.20% during the European morning (+7.5bps on the day) but ended up closing -9.3bps lower at 3.03%, showing that wide intraday ranges and volatility continue to grip the market. With the Fed continuing to put a perceived ceiling on the near-term pace of hikes, 2yr yields rallied -13.7bps on the day with the curve steepening another +5.3bps. The amount of Fed hikes priced in by the December meeting down by -15.5bps. As I type, 10yr US yields are fairly flat in Asia. The move echoed in Europe, where 10yr bunds rallied -3.5bps to 1.09%. The broader risk-off move meant that there was a further widening in spreads yesterday, with the gap between Italian 10yr BTPs over bunds widening by +4.9bps to 205bps, which is the widest they’ve been since May 2020. And that widening was seen on the credit side as well, where iTraxx Main moved above 100bps for the first time since April 2020 in trading, before falling back somewhat to settle at 98bps (+1.4bps). Against this backdrop, the S&P 500 fell by a sizeable -3.20% that takes the index to its lowest level in over a year. That comes on the backs of 5 consecutive weekly losses, which is already the longest run in over a decade, and given the performance yesterday it would take a strong comeback over the remaining four days this week to avoid that run extending to 6 weeks. See my Chart of the Day yesterday (link here) for more on how rare it has been to see an 11 year run without a 5 successive weekly decline. Energy was the worst performing US sector, falling an astonishing -8.30%, in its worst one-day performance since June 2020, after the fall in oil (more below). The sector is still by far the best performing S&P sector YTD, up +36.79%, with every other sector in the red. Despite the rate rally, it was a bad day for mega-cap and other growth tech stocks. Indeed, the NASDAQ fell a further -4.29% to its lowest level since November 2020, whilst the FANG+ index of 10 megacap tech stocks fell an even larger -5.48%. For reference, that now takes the FANG+ index’s decline since its all-time high in November to a massive -38.22%. Even a high quality component like Amazon is now down -35.75% since March 29th and is pretty much back to pre-covid levels. Over the other side of the pond, Europe saw some sizeable declines as well, with the STOXX 600 down -2.90% to leave the index not far away from its recent lows in early March. With the Fed set to continue their hiking cycle, just as the ECB are still pondering on when to even start hikes and China’s growth prospects are fading, the US dollar has continued to benefit. Yesterday, the Japanese Yen (+0.21% vs USD) was the top-performing G10 currency, in line with its traditional status as a safe haven, but Bitcoin continued to lose ground, falling to its lowest level since July last year, after falling to $31,562. It briefly fell below 30k this morning. It's been interesting that Bitcoin is not getting much mention with all the inflationary issues seen in recent months. It seems to be suffering from a higher dollar, higher real yields and a tech related sell-off. Markets continue to fall in Asia but US futures are up. Hang Seng (-3.06%) is the largest underperformer, but is paring its losses after falling more than -4% as the market returned after a holiday with the Chinese listed tech firms among the worst hit. Elsewhere, the Nikkei (-0.93%) and Kospi (-0.95%) are down. Meanwhile, mainland Chinese stocks are trading in positive territory with the Shanghai Composite (+0.17%) and CSI (+0.15%) somewhat recovering from opening losses. Looking ahead, S&P 500 (+0.56%), NASDAQ 100 (+0.92%) and DAX (+0.25%) futures are moving higher. Early morning data showed that Japan’s household spending declined -2.3% y/y in March, its first drop in three months albeit the fall was less than -3.3% estimated by Bloomberg and followed +1.1% growth in February. Back to inflation and one potentially problematic indicator came from the New York Fed’s latest consumer survey, which found that median inflation expectations for 3 years ahead rose to +3.9%, which is the highest since December, and up from +3.5% back in January. It’s still not as high as the +4.2% readings back in September and October, but will obviously be unwelcome news to the Fed whose path to a soft landing is in part reliant on inflation expectations remaining well anchored around target. Turning to the situation in Ukraine, a key risk event yesterday had been Russia’s Victory Day parade, where it was speculated that President Putin would move towards a general mobilisation. However, in reality it finished with surprisingly little news, and whilst not showing a path towards de-escalation, didn’t move to escalate things further. Separately, it was reported by Bloomberg that the EU would soften its proposed sanctions package on Russian oil exports, with an article saying that they would drop the proposal to ban EU-owned vessels transporting Russian oil to third countries. The sanctions package has already come under criticism from some member states, and the article said that Hungary and Slovakia had been offered a longer time period lasting until end-2024 to comply with the proposals to ban Russian oil imports, with Hungary in particular saying more talks were needed to support oil-related sanctions. So with no further escalation and a softening in sanctions, oil prices fell back significantly amidst weak risk appetite more generally. Brent crude was down -5.74%, whilst WTI fell -6.09%, which follows 2 consecutive weekly gains for both. This morning oil prices are again lower with Brent and WTI futures -1.74% and -1.68% lower respectively. To the day ahead now, and central bank speakers include the Fed’s Williams, Barkin, Waller, Kashkari and Mester, along with ECB Vice President de Guindos and Bundesbank President Nagel. Data releases include Italy’s industrial production for March and Germany’s ZEW survey for May. Finally on the political side, President Biden will meet with Italian Prime Minister Draghi at the White House, and the UK state opening of Parliament is taking place, where the government outlines its legislative programme for the year ahead. Tyler Durden Tue, 05/10/2022 - 07:57.....»»

Category: smallbizSource: nytMay 10th, 2022

The movie-theater industry is giddy about films like "Top Gun" and "Avatar," as streaming falters and major studios like Disney and Warner Bros. reset their strategies

Major film studios showed off their upcoming movies to theater owners during CinemaCon and the industry is abuzz about 2022's release slate. Tom Cruise in "Top Gun: Maverick."Paramount Pictures The theater industry was buzzing at CinemaCon this year about the return of moviegoing. Disney won theater owners over again, and Paramount's "Top Gun: Maverick" energized attendees. The industry is also still trying to court Netflix, and has big concerns about Amazon. The US theatrical industry was devastated during the last two years by the coronavirus pandemic. But one wouldn't have known that last week at CinemaCon in Las Vegas, where a sense of optimism for the state of movie theaters swept over the convention.Insider attended the annual week-long event, where the major film studios showcased their upcoming slates of theatrical releases to giddy theater owners.This year's event followed a tumultuous period for Hollywood, as theaters throughout the US shut down during most of 2020 and drove studios to experiment with new distribution strategies to boost their streaming businesses.The theatrical industry isn't out of the woods yet — the box office is still down from pre-pandemic levels and will take a while to fully recover. But, from CinemaCon's various studio presentations, interviews with top industry execs, and behind-the-scenes chatter, it seems that things are pivoting in a favorable direction for the industry.Industry leaders are overjoyed that movie studios are, for the most part, moving away from releasing movies simultaneously in theaters and on streaming services. They are also excited about the upcoming release slate, including long-awaited films like "Top Gun: Maverick" and "Avatar: The Way of Water." "It's good to see the level of optimism, not just from exhibitors but from film companies," said Rolando Rodriguez, the CEO of Marcus Theatres and the chairman of the National Association of Theatre Owners (NATO). "There's a realization that theatrical windows are important to build their intellectual property."Studios are moving away from day-and-date releasesThe collapse of the theatrical window was one of the biggest obstacles for the theatrical industry during the pandemic.Before the pandemic, theaters typically played movies exclusively for 75 days to 90 days. But in an industry-shaking strategy, Warner Bros. released last year all of its movies simultaneously in theaters and on HBO Max. Other studios also released some of their biggest movies in theaters and on streaming services at the same time.That "day-and-date" strategy, as it's called, isn't completely disappearing. Universal will this month release "Firestarter" simultaneously on Peacock and in theaters.But as far as theater owners are concerned, it's "dead as a serious business model," John Fithian, the CEO of NATO, said. Movie studios are committing their biggest releases to exclusive theatrical windows this year."That doesn't mean that there won't be distributors that toy occasionally with that concept," Fithian told Insider. "But from what we are hearing from the studios, they are focused on their slate of movies that are intended for theaters with an exclusive window."The new window seems to be coalescing around 45 days. Universal and Warner Bros. have both said that, starting this year, their theatrically exclusive movies will have at least that window before debuting on their respective streaming services.The consensus within the theatrical industry is that an exclusive theatrical release can help a movie's streaming chances by building momentum and word of mouth. Multiple people Insider spoke to cited "The Batman" as an example, as it's made nearly $800 million at the worldwide box office and is also a hit on HBO Max.The release model worked for "Encanto," too. The Disney animated movie surged in popularity after it hit Disney+. Social-media data from the analytics company Diesel Labs showed that the movie peaked in online engagement while it was in theaters, but it got another boost, and maintained a longer period of engagement, once it hit streaming."Avatar."20th Century FoxDisney and 'Top Gun: Maverick' won CinemaConSpeaking of Disney: While every studio brought the goods to wow the theatrical industry, Disney was one of the biggest winners out of CinemaCon.Theater owners soured on the company last year when it released "Black Widow" simultaneously in theaters and on Disney+ for an additional fee. It went a step further by releasing revenue figures for the movie's first week on the service, sparking the theater industry's ire. NATO released a scathing statement about the strategy after the movie tanked at the box office in its second weekend.But all of that seems to have been forgiven, even though the company still hasn't announced a set theatrical window like other studios have.When Disney touted during its CinemaCon presentation its lucrative brands, from Marvel to Pixar to Lucasfilm, the crowd went wild. Industry figures were impressed with the company's theatrical slate, including "Avatar: The Way of Water," which several people pointed out as a potential game-changer for the industry, like its 2009 predecessor was (it's the highest-grossing movie of all time globally)."There's no way to nuance my memories of the first movie," Rich Gelfond, the CEO of Imax, said. "It changed everything. It impacted all parts of our business."Convention attendees were also buzzing about Paramount's long-delayed "Top Gun: Maverick," which the studio screened in full at CinemaCon. The industry is betting that the movie, which arrives in theaters on May 27, will bring out older audiences — the 45-and-older crowd that has been slow to return to theaters."It's a perfect, energizing, fun movie with an audience that grew up with Tom Cruise and 'Top Gun,'" Rodriguez said. "It will touch an older audience base but ideally also connect with a younger audience, too. If I had to choose one movie, I'd say it's that one that could really break through with a consumer base we want back."If early projections are any indication, Rodriguez may be right. Box Office Pro's chief analyst Shawn Robbins is estimating a range of anywhere between $95 million to $135 million for its opening weekend in the US.The theater industry is optimistic about Warner Bros. againDisney isn't the only studio that is clawing its way back into theater owners' good graces.Warner Bros. Picture Group chairman Toby Emmerich touted to a muted crowd that it was the only studio to consistently release movies to theaters last year. The industry accepts that studios had to release some movies day-and-date, and that it was even good to an extent for theaters at a time when so few films were coming out. But doing so with the full-year slate went too far.However, the 2021 day-and-date experiment is over, and the studio is under new ownership. WarnerMedia and Discovery finalized their merger in April, and former Discovery CEO David Zaslav is leading the new company, called Warner Bros. Discovery. Zaslav has made a point of repairing Warner Bros.' relationship with theaters since taking on the role.To show its commitment to theaters, Warner Bros. brought for its CinemaCon presentation none other than Dwayne Johnson, one of the world's biggest movie stars, to present his upcoming DC movies, "League of Super Pets" and "Black Adam.""The energy and enthusiasm that David Zaslav brings to Warner Bros. and his excitement for the business show that theatrical is an important mechanism," Rodriguez said.Dwayne Johnson in "Black Adam."Warner Bros.Theater execs have their sights on streamers including NetflixNow that theater owners have traditional Hollywood studios where they want them, they're pushing streaming-first companies to embrace longer theatrical windows, too.Netflix has always resisted longer windows for the movies that it releases to theaters. But theater owners are still courting the streaming company, which lost in its most recent quarter subscribers for the first time in a decade. While NATO leadership didn't elaborate on those talks, they have their arms wide open."We're always open to bigger theatrical releases from the streaming companies if they have appropriate windows," Fithian, the NATO chief, said. "The theater door is open to Netflix if they want to go with a bigger theatrical strategy."But while theater execs are trying to lure streamers, they still have concerns about Amazon's acquisition of the MGM film studio. NATO leadership doesn't know if Amazon will release MGM movies exclusively to theaters or on Prime Video."If Amazon uses MGM mainly for streaming, it wouldn't be great for us," Mooky Greidinger, the CEO of Cineworld, said. "But on the other hand, Amazon is a very powerful company that could make MGM into the big studio it was 50 years ago. I don't know where it's going, but I hope Amazon recognizes the potential for theatrical releases."Read the original article on Business Insider.....»»

Category: topSource: businessinsiderMay 2nd, 2022

MoviePass Co-Founder Stacy Spikes Is Trying to Stage a Comeback–and Save Movie Theaters in the Process

Any resemblance to Steve Jobs was unintentional, or so Stacy Spikes claims. Back in February, minutes before Spikes was set to take the stage at Lincoln Center in New York City to announce the resurrection of his old company, MoviePass, he realized he was sweating through his white button-up shirt and jacket. He changed into… Any resemblance to Steve Jobs was unintentional, or so Stacy Spikes claims. Back in February, minutes before Spikes was set to take the stage at Lincoln Center in New York City to announce the resurrection of his old company, MoviePass, he realized he was sweating through his white button-up shirt and jacket. He changed into a more breathable black mock turtleneck, which, on his slim figure, paired with dark jeans, sneakers, and glasses, looked a lot like an homage to the Apple co-founder. “I didn’t want to be thinking, Are they going to see my sweaty pits?” Spikes, 54, says during an interview in a Manhattan office several weeks later. “When people said, ‘That’s very Steve Jobs,’ I was like, ‘Everybody in New York dresses in all black.’” [time-brightcove not-tgx=”true”] Spikes will invite the comparison again when his memoir, Black Founder: The Hidden Power of Being an Outsider, arrives in December. For the stark cover, he wore a nearly identical black shirt. Like Jobs, Spikes built a company from scratch only to be pushed out. Like Jobs, he watched from the sidelines as it fell apart. And like Jobs, he will attempt a triumphant return to the business he built. But while Jobs was self-assured to the point of polarizing colleagues and occasionally the public, Spikes charms you into buying his vision of the future—specifically the future of moviegoing. He asks everyone he meets what films they’ve seen lately. He refuses to disparage a movie (to a journalist, anyway), even when I try to goad him into criticizing some of this year’s Oscar contenders. He’s eager to discuss why his friend might have missed the majesty of Dune’s sandy hills by watching the sci-fi epic at home rather than in an IMAX theater. “An adventure should never come with a pause button,” he says. He loves a dramatic metaphor: during his MoviePass 2.0 presentation, he included a slide of a phoenix rising from the ashes. Read More: 10 Oscar-Nominated Movies and Performances You May Not Have Seen—But Should Most people who are familiar with MoviePass—and it had more than 3 million members at its peak in the late 2010s—probably remember it as the company that offered cardholders the chance to see one movie per day at the theater of their choice for just $9.95 a month, and then predictably crashed and burned when the deal proved too good to be true. For Spikes, the story is more complicated—and more personal. It is one of struggling for years to secure funding, which he attributes at least in part to racial discrimination, and then being ignored when he disagreed with the business plan put forth by the company that bought a majority stake. He illustrated the implosion of MoviePass during his presentation with a picture of the Hindenburg. Spikes is staging a comeback in a radically altered moviegoing environment. COVID-19 scared people away from theaters, and the proliferation of streaming services has kept them on their couches. The 2021 domestic box office, which includes the U.S. and Canada, trailed 2019’s by 60%. “We’re at the point where the industry is willing to try things,” says Daniel Loría, editorial director at Boxoffice Pro. “This is probably the perfect time for MoviePass to come back if it was ever going to come back at all.” In its heyday, Spikes says, MoviePass increased any one user’s moviegoing somewhere between 100% and 144% by incentivizing customers to take risks on movies they wouldn’t otherwise see. Now Spikes believes he can boost attendance again. “We ask, Will anyone go to movies anymore? But we don’t ask that about other events,” he says. “We don’t ask, Is anyone going to go to basketball games anymore? Soccer games? Because you can watch those at home, but the live experience is different.” Spikes is a magnetic pitchman, but it’s impossible to assess the feasibility of his plan. He is still trying to strike deals with theater chains and won’t even specify a date for the product’s release beyond that he’s targeting summer movie season. Perhaps most salient, while he says there will be a tiered pricing plan, he won’t say what those numbers actually are until launch day. He will say this: “It won’t be $10.” Spikes often tells the story about how Blade Runner convinced him he wanted to pack his bags for Hollywood. When he was 14, he watched it in a theater wedged between his father, who fell asleep, and his inattentive brother. “I kept nudging my dad, who was just snoring, and my brother’s like this.” Spikes fidgets in his seat. “And I’m there thinking, How can I be a part of this world?” Spikes worked in a video store as a high schooler in Houston, left Texas for California with just $300 in his pocket, and got a job as a production manager at a production company at 19. He worked briefly on the business side of record companies before helping to market film soundtracks at Sony. By age 27, he was vice president of marketing at Miramax. Illustration by Party of One for TIME But it was films like Dumbo that set him on his career trajectory. “Do you know that Dumbo song with the crows?” he asks, before singing a few bars of that song, the one sung by a bird named Jim Crow. (Disney now runs a warning in front of the movie.) “As a kid, I guess it was supposed to be flattering that you were getting seen in something,” says Spikes. “But as I got older and worked in the movie business, I had this whole different view of what I saw in my childhood.” In 1997, he founded the Urbanworld Film Festival, which featured the works of BIPOC filmmakers, including Ava DuVernay and Ryan Coogler before they were household names. “I was the Spike Lee of distribution because there was no one of color on that side of the fence,” he says. In 2004, the festival hosted the premiere of the thriller Collateral starring Jamie Foxx, Tom Cruise, and Jada Pinkett Smith. “I felt like I’d summited Everest, but I needed to find what was next.” Read More: Hollywood So Often Gets Black History Wrong. Black Filmmakers Are Setting the Record Straight In 2006, he designed a system that would allow moviegoers to sign up for a subscription and request tickets via text message. There were already subscription services at the movie theater chains in Europe, so Spikes was just introducing the concept to the U.S. “Everyone was like, ‘A subscription? That’s stupid,’” he says. “I was laughed out of conference rooms.” Or worse. For years, he was unable to get funding for his venture. Black entrepreneurs received about 1% of venture-capital funding in 2011, the year he ultimately launched the company. (A decade later, that number has barely ticked up: Black founders received 1.2% of VC funding in the first half of 2021 when startups raised a record-breaking $147 billion.) “When you want access to higher capital, there’s a Black tax on you,” Spikes says. “It was like I had to run faster, climb higher than these guys who had multiple failed businesses. If you don’t look like Mark Zuckerberg, you don’t fit the mold. I saw a lot of people getting funding for worse business ideas, but they dropped out of Stanford, so they got a shot.” Spikes used to bring an analyst named Geoff Kozma with him to pitch meetings to run the numbers in real time. “So Geoff and I walk into the meeting, and the guy walks over to Geoff, puts his hand out, and goes, ‘Stacy, it’s so nice to meet you,’ and Geoff goes, ‘That’s Stacy.’” Kozma was a young white man. “But even after that, at that meeting and a lot of other meetings, Geoff would be sitting there, and the VC guys’ attention would start drifting toward him. They’d start asking him questions instead of me. And I was like, Really?” The rejections were particularly upsetting because, as his current and former co-workers attest, Spikes is obsessed with going to the movies. Ryan McManus, who started as an intern at the first iteration of MoviePass and is now head of product for MoviePass 2.0, has worked with Spikes on and off for nearly a decade. “I’ve saved every movie-ticket stub going back to 2003,” says McManus, “and he was even more passionate about movies than I was.” In 2011, Spikes brought on Hamet Watt as a co-founder, and they were able to raise a combined $1 million from AOL and the venture-capital firm True Ventures. MoviePass launched that year, but five years after that, it still wasn’t profitable. Mitch Lowe, a former Redbox and Netflix executive, acted as an early MoviePass adviser, and found working with Spikes frustrating. But he felt they always had a connection, and agreed to come on board as CEO in 2016. “His main investor brought me in to essentially be his boss,” Lowe says. “That would be hard for anybody. He put his heart and soul into it. But he and I were great partners for that first year and a half, two years.” Liz Hafalia—The San Francisco Chronicle/Getty ImagesMoviePass co-founders Stacy Spikes, left, and Hamet Watt at AMC in San Francisco, Calif., on January 29, 2011. Around that time the company had 20,000 subscribers who were being charged $34.95 to $49.95 per month, and it was still losing about $50,000 to $110,000 per month. Lowe, too, struggled to convince investors that MoviePass had juice. Looking back, he says Spikes may indeed have faced discrimination, but there was clearly a problem with the business proposition as well. “I met with 120 different investors and got no on 120,” Lowe says. “My wife is African American, so I see racism out there. I see the way people are treated. But I would not say that was the only reason. I wasn’t with Stacy in any of his investment meetings, but I can tell you I had 120 nos, and I’m a white guy.” Then, in 2017, the data-analytics firm Helios and Matheson bought 51% of the company for $25 million. To increase subscribers, Helios and Matheson wanted to run a “promotion” dropping the price to $9.95 a month. Spikes, who had experimented with price points ranging from $19.99 to $49.99 over the years, was not wild about the idea. The average movie-ticket price in the U.S. was $8.97, so users would have access to near unlimited movies for just over the price of a single ticket. In the press, Lowe and Ted Farnsworth, CEO of Helios and Matheson, said they hoped MoviePass would work like a gym membership: plenty of people pay the monthly fee and never go, so the gym turns a profit. Here’s the problem: people don’t like running on a treadmill; they do like going to the movies. Still, Spikes says he agreed to the promotion as long as they upped the price again after 100,000 new sign-ups. “It happened in literally 48 hours,” says Spikes. “I was like, ‘Great, turn it off.’ And they were like, ‘No, no, leave it on. See what happens. We know what we’re doing.’” Spikes calculates they were losing $30 per customer per month. Lowe says it was closer to $17. Either way, they were losing money. “The math didn’t work,” says Spikes. In December 2017, the same month MoviePass reached its millionth subscriber, Spikes was removed from the board. The next month, he was informed he was no longer needed at the company. A few days after he was ousted, Spikes went to the movies. “I walk up to the kiosk. And the person on my left pulls out a MoviePass card. The person on my right pulls out a MoviePass card. And they’re literally looking and smiling at each other. And you knew we were all part of something big,” he says. “And I’d created that. I never forgot that feeling.” Read More: The 10 Best Movie Performances of 2021 By the first half of 2018, MoviePass members were buying 6.6% of all movie tickets in the U.S., according to Lowe. But that year, Helios and Matheson reported an estimated net loss of $329.2 million. In 2020, Helios and Matheson filed for Chapter 7 bankruptcy, and in 2021 the Federal Trade Commission filed a complaint alleging that the company had failed to secure customer data and had engaged in fraudulent practices like invalidating users’ passwords to try to prevent them from buying too many tickets. The resulting settlement prohibited the company from misrepresenting its practices and required it to put better security programs in place. But by then, MoviePass was long gone: it shuttered in September 2019. (Lowe said he could not comment on the FTC investigation because of a nondisclosure agreement, but blames the demise of MoviePass largely on user fraud—members sharing cards with one another and otherwise bypassing the system. Farnsworth did not respond to requests for comment.) Spikes equates what he experienced with PTSD. “I was licking my wounds for about two months when my wife was like, ‘You need to put some clothes on and get out of the house.’” Then, late last year, he heard from someone working on a documentary about the rise and fall of MoviePass that nobody had bought the company assets during the bankruptcy auction. He called the trustee, who said the minimum bid was $250,000. Spikes talked him down to $140,000. In September 2020, Spikes drove alone from his home in Manhattan to Hoboken, N.J., donned two masks, and sat in a theater with 10 other people to watch the action film Tenet. The next weekend he returned to see it again. “He’s my people, right?” Spikes says of director Christopher Nolan, who very publicly refused to debut his movie on a streaming service. “I told my wife, even if I have to get on a plane to fly to an open theater, I’m going to support this movie. And I’ve been at the movies pretty much every weekend since.” He’s likely one of the few who can make that claim. Movie attendance plummeted during the pandemic: In 2019, 76% of people in the U.S. and Canada saw at least one movie in theaters. In 2021, that number dropped to 47%. People may have gotten used to streaming movies at home, especially since services like Disney+, HBO Max, and Peacock all launched right before or during the pandemic. Every year, the Motion Picture Association releases data on the combined theatrical and home/mobile entertainment market. In 2019, it found that global digital spending (which includes purchases and rentals of movies from companies like Amazon and Apple) made up 48% of the market, theatrical sales made up 42%, and purchases of physical content like DVDs made up 10%. In 2021, digital spending made up 72% of the market, theatrical 21%, and physical content 7%. That digital spending calculation doesn’t even include the money customers pay for subscriptions to streaming services like Netflix. The window between a theatrical release and a streaming release is also shrinking; would-be moviegoers often have to wait only a few weeks to stream a movie like The Batman. The Oscar-winning CODA was released simultaneously on streaming and in theaters, and studios occasionally skip the theater altogether. Spikes dismisses the threat of streaming and compares the situation to when DVDs went mainstream in the late ’90s. “We forget that we were worried people would stay home then too,” he says. But Rich Daughtridge, CEO of the upstart chain Warehouse Cinemas and president of the Independent Cinema Alliance, views the proliferation of streaming differently: “We see our main competition as the couch.” Read More: The 10 Best Movies of 2021 Spikes often touts the loyalty of MoviePass customers. When he first founded the company, he was inspired by Steve Jobs’ biography to suggest that every employee—including himself—spend at least one day per month on the customer-service line. He recalls one not-so-happy customer who dropped her phone while running to the theater and demanded the company buy her a new $600 smartphone. “I was like, ‘But, ma’am, you dropped your phone,’” he says. “I think I gave her a free month.” But more often the calls would turn into discussions about how much MoviePass members adored going to the movies. They hadn’t abandoned cinema because of Netflix. They’d abandoned it because movie tickets had gotten too expensive: movie attendance was already declining before the pandemic even as the box office ballooned, thanks to higher ticket prices. MoviePass’s relatively low (and later, absurdly low) price tag helped increase its customers’ attendance, until those fervent movie-goers quite literally loved MoviePass to death. Persuading moviegoers to return to MoviePass may prove less challenging than wooing movie theaters. MoviePass buys tickets for its users directly from the theater. If it can buy discounted tickets, in exchange for promoting the theater on its app and incentivizing customers to go to the movies on slow-traffic days, the company can flourish. But if it has to pay full price for tickets, it will have to rely heavily on other revenue streams like advertising. Spikes claims that the pandemic has made theaters much more open to MoviePass. “Before, the conversation was ‘Eh,’” says Spikes of his initial proposal in the 2010s. “Now the conversations are, ‘Congratulations on buying it. How soon can you be up?’ So COVID definitely did something it would have taken us years to do.” My exchanges with theaters were more measured. The head of a small theater chain, who asked to remain anonymous because the company is still considering working with Spikes, said the customer-service issues that plagued MoviePass at the end of its first run “left a bad taste in our mouths.” The big chains—AMC, Regal, and Cinemark—declined to comment for this story. Loría of Boxoffice Pro says those chains likely see MoviePass as competition to their own loyalty programs, which were developed, at least to some degree, because of the success of MoviePass 1.0. Spikes is undeterred. He says he’s had preliminary conversations with Cinemark and Regal, but AMC has not responded to his calls: “My feeling is at the beginning there may be some competitiveness, but if you still have empty seats, what do you care? Get bodies in there.” Justin J Wee for TIMESpikes, who has been infatuated with Hollywood since he was a teen, makes weekly trips to the movies. Smaller chains and independent theaters—which make up about 20% of the industry, according to Daughtridge—seem more open to working with MoviePass. Alamo Drafthouse has 36 locations across the country and boasts comfy seats, meals instead of just concessions, and alcohol. The founders pride themselves on exhibiting smaller films that the bigger chains don’t show. In theory, their interest in saving the indie filmgoing experience should align with MoviePass’s mission. According to Lowe, in 2018, MoviePass was buying 30% of all movie tickets sold in the U.S. for smaller films (ones that grossed $20 million or less). “We’ve been quite disruptive in the space,” says Michael Kustermann, the chief experience officer at Alamo. “So I think we were always curious about MoviePass. I think the $9.95 thing was a mistake. But like all good disrupters, there was probably a seed of a great idea that theaters should have been thinking of themselves.” Kustermann says Alamo, which has its own loyalty program, has not yet decided whether it will partner with MoviePass but has not ruled it out. “Instead of being dictatorial about how people get in the door, Alamo focuses more on the experience once they’re in the door.” After all, most theaters make their money on concession sales, and that’s especially true of chains that sell alcohol. “I’m definitely intrigued,” says Daughtridge, of Warehouse Cinemas, which has two theaters in Maryland. He and Spikes have spoken several times about the potential of MoviePass 2.0. “We’re just running the numbers to make sure we don’t cannibalize our own sales.” This summer will prove a crucial test for MoviePass’s viability, as a backlog of delayed blockbusters, like Top Gun: Maverick, Doctor Strange in the Multiverse of Madness, and Jurassic World Dominion, debut exclusively in movie theaters. “All the good content had been moved out. So it’s kind of like starving the patient and asking why they’re not gaining any weight,” Spikes says of the box office. Optimistic prognosticators point to Spider-Man: No Way Home, which in December had the second biggest opening weekend in Hollywood history despite premiering during the Omicron surge, as a sign that audiences will come back. But even with that coup, the domestic box office totaled around $4.5 billion last year, compared with $11.4 billion in 2019. About 10% of the estimated 5,500 movie theaters open pre-pandemic in the U.S. closed either temporarily or permanently, according to Comscore, and the theaters that are open today are mostly surviving on a few hits like Spider-Man and The Batman. Cinephiles fear a future in which studios make only superhero films for the big screen and relegate everything else to streaming. MoviePass doesn’t move the needle on the Marvel or Star Wars movies—people are going to come out for those anyway—but it may be able to have a substantial impact in driving ticket sales to indie films, Oscar bait, and documentaries. If MoviePass can scale, then it could play a major role in saving the moviegoing experience. But with just months before launch, MoviePass won’t confirm whether Spikes has brokered any deals at all. MoviePass can exist without theater buy-in, but it’s unclear if it can thrive. To that end, Spikes will try to build a subscriber base quickly with several changes from its original incarnation, including tiered pricing options and in-app credits that customers can earn by watching ads. They will be able to apply these credits toward tickets for friends and family members who don’t subscribe to MoviePass, and, eventually, Spikes says, users will be able to trade credits among themselves via blockchain technology. Customers can also invest as stakeholders in the company. During the MoviePass relaunch presentation, Spikes floated the idea of implementing technology that would track the user’s eyes during an ad and pause the ad if the user looked away or put the phone down. The demo immediately drew comparisons to dystopias like A Clockwork Orange. “I can say it’s given us some level of pause,” Spikes tells me when we meet. “If it’s something that we even decide to deploy, it might be radioactive. So it maybe doesn’t see the light of day.” A month later, he says he’s decided it will not be a part of the app launch this summer, though he may consider integrating it later. It’s clear that Spikes cares deeply about the future of cinema, but he’s also desperate to give the MoviePass story a happy ending. “I sometimes worry if I build something new, someone will take it away from me again,” he admits. Yet he forged ahead with the relaunch. “I knew I could build something again. Because you can’t take my intelligence. You can’t take away my passion.” Read More: People Longing for Movie Theaters During the 1918 Flu Pandemic Feels Very Familiar in 2021 If MoviePass succeeds, Spikes will be vindicated. Lowe and others who pushed him out will be cast as the obstacles he had to overcome to make his comeback. I ask Lowe how he feels about his role in that potential narrative. “I’d be so happy for his success in this,” he says. “It wouldn’t bother me at all for people to say that he told me so.” With reporting by Mariah Espada.....»»

Category: topSource: timeApr 27th, 2022

Transcript: Luana Lopes Lara

     Transcript: Luana Lopes Lara The transcript from this week’s, MiB: Luana Lopes Lara, Kalshi, is below. You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Stitcher, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here. ~~~ RITHOLTZ: This… Read More The post Transcript: Luana Lopes Lara appeared first on The Big Picture.      Transcript: Luana Lopes Lara The transcript from this week’s, MiB: Luana Lopes Lara, Kalshi, is below. You can stream and download our full conversation, including the podcast extras on iTunes, Spotify, Stitcher, Google, Bloomberg, and Acast. All of our earlier podcasts on your favorite pod hosts can be found here. ~~~ RITHOLTZ: This week on the podcast, I have an extra special guest, Luana Lopes Lara is a co-founder of Kalshi. They are a derivatives trading marketplace, where you can go and trade event contracts on such disparate occurrences such as COVID-19, economic outcomes, interest rates, Federal Reserve, politics, climate and weather, culture, the Oscars, the Grammys, science and technology, all sorts of really fascinating places. They are the only such marketplace that has been approved for the sort of events trading by the Commodity Futures Trading Commission, the CFTC, which makes them both fascinating and — and unique. There’s nothing else like them. This provides a way for individuals and institutions to hedge all sorts of really interesting events. And as opposed to having think about, well, if this happens, what’s the ramification in gold, or oil, or inflation, or interest rates, you can actually bet on that exact event and hedge your business or your portfolio. It’s really quite fascinating. I thought this was really interesting conversation, and I think you will also. So with no further ado, my conversation with Kalshi Co-Founder, Luana Lopes Lara. ANNOUNCER: This is Masters in Business with Barry Ritholtz on Bloomberg Radio. RITHOLTZ: My special guest this week is Luana Lopes Lara. She is the co-founder of Kalshi, one of the only derivative trading marketplaces that allows the trading of event contracts in order to hedge against major business and political events. Kalshi is the only marketplace to receive approval from the Commodity Futures Trading Commission, who regulates the trillion-dollar derivatives industry. Luana Lopes Lara, welcome to Bloomberg. LARA: Thank you so much. I’m very happy to be here. RITHOLTZ: So — so let’s start just with that unusual intro, you’re the only CFTC-approved way to trade on the outcome of events. Explain that a little bit. LARA: Right, exactly. Kalshi is a financial exchange that allows people to trade on the outcome of a lot of different events. So things from, will inflation keep going as high as it is right now, will the Fed raise rates to like, well, 2020 with the hottest year on record? And what really sets us apart is that we’re the only — the first and only ones regulated by the CFTC to do this in the United States. RITHOLTZ: So — so let’s talk about that because I love the story about you guys. You and your co-founder, you start calling attorneys, and one day, you end up calling like 60 or 70 lawyers in a single day. And pretty much every one of them said, “People have been trying to do this since the 1980s. It’s never been approved. Just forget about it, it’s not happening.” Tell us about that. LARA: Right. So we really wanted to build Kalshi the right way. So to view the exchange that is sustainable and — and can be a pillar of the financial world, we wanted to make this really big, get the right partners on board, and really try to build something that’s going to outlast CME. You know, like, CME is around there for like 150 years. RITHOLTZ: Right. LARA: And the way to do that, for us, was to build a proper financial exchange, to build this right. And we knew that getting regulated was the first step and like figuring out how to do it right. But obviously, me and my co-founder were both computer scientists, we knew nothing about regulation. So we sat down and put on a spreadsheet the names and — and emails of – of 65 different lawyers that we thought maybe could be related to this, and we called one by one. I think we split who was going to call who. And all of them were just like, “That’s not going to happen. The CFTC won’t allow this. It has already — they already said no to this in the past.” But because of a friend of a friend of a friend, we ended up getting to Jeff Bandman, who works with us till today. He’s an ex-official of the CFTC, and he really understood the Commission and – and helped us — started — helping us start navigating the entire situation. And yeah, it was two years of — of — of that entire engagement and iteration of the CFTC with all their core principles and concerns that they had, to address them and — and really ended up getting regulated in November 2020. RITHOLTZ: So it sounds like it wasn’t so much that the CFTC was against the idea of event contracts in order to hedge on these circumstances. They just didn’t like what was presented them previously, over the previous 40 years, or — or did something change that they suddenly said, “Oh, we used to think this was a bad idea. Now, we think it’s a good idea.” LARA: I think it was — it’s more of the first. I think it was about presenting to them why we thought event contracts were so important, and how they could really be used for hedging. And every day hedging like — like retail, and Americans every day can hedge things like inflation, like rates, risks that we see and read about like in the news or on TV every day. And it was really like presenting to them and getting them to comfort with how these markets work, how they weren’t easy to manipulate, how the rules could — could operate. So really getting them to comfort with how the exchange, the markets, and all of our contracts could — could operate, and that’s what took that long. It wasn’t — in my opinion, it was more like explaining what we wanted to do. They were fantastic from the beginning to really listening and working with us. It wasn’t that they were just like, “No, we’re never going to do this.” RITHOLTZ: I — I think it’s interesting that it took people from outside of the world of finance to bring an idea into finance from a technology perspective and say, “Whatever the logistical hurdles we have to meet in order to receive regulatory approval,” that wasn’t like an ideological problem. To you, it was a, “Well, this is a logistical problem that we have to solve. And once we solve it, we can get this going.” So how long did the back and forth with the CFTC take to get approval? LARA: Yeah. No, it was two years or two years and a half. RITHOLTZ: Wow. LARA: And yeah, we used to say it’s like we were climbing a very high mountain, and then as we started climbing more, we would see it’s actually twice as high and it would keep – and it would keep multiplying. Because the thing is we would go to them and — and they would have concerns and issues, so we would go back and solve the issues. A lot of it, as you mentioned, was related to technology. We did analysis on similar markets on what we could do, and viewed the surveillance systems and all of those things, and going back to them, and then they were like, “Okay, that’s fine.” But we have all these other issues now, and then we would go back and — and figure them out and — and — and do that one by one. It was like walking in the desert a little bit. We didn’t know where — where the end was. But it ended up working out. RITHOLTZ: So — so let’s talk a little bit about your platform. This is unlike futures and it’s unlike derivatives, and that when you are purchasing a contract, you are putting up the full dollar amount. It’s not like where you’re putting up 10 cents on the dollar, or one cent on the dollar. If you’re making a $1,000 bet, you are posting a $1,000. How much did that factor influenced the CFTC that this wasn’t just going to be reckless speculation and — and people fooling around, this was really hedging? LARA: Right. So we are fully cash collateralized. So every — as you said, every dollar that you can lose or every dollar that you — you trade, you have to have it with us before. And I think this really helps with the safety of the platform and it really started from us. We really want to start in a way that is very safe for everyone, and we can really understand the system before going like too far ahead. And we really see this as very important. So all the funds are fully cash collateralized. But obviously from — from the CFTC perspective, it adds to their comfort to the fact that there can’t be like leverage or margin or more risk added to the system, that all the money is collateralized, and the retail is protected because of that. RITHOLTZ: So equities, you can put up half the – the dollar amount, 2 to 1, futures or something like 10 to 1. Options, if you go out of — out of the money and far enough into the future, it’s — it’s a 100 to 1. Is there ever a plan to move away from the 1 to 1, dollar for dollar, maybe not option 100 to 1? But certainly, margin and equity market seems to be pretty reasonable at 2 to 1. LARA: At the moment, we’re really focused on retail and fully cash collateralization — fully cash — being fully cash collateralized. But at — in the future, I think our goal is to be like the New York Stock Exchange for events. So having — being really the — the central place of the ecosystem, and having like different brokers and institutions, hedge funds, market makers plugged into us, the exchange. At that point, it would make sense to start considering something like that. But right now, we’re completely focused on retail and having it fully cash collateralized as well. RITHOLTZ: Right. So once — once it becomes a big institutional exchange, then — then you can explore that. LARA: Right. RITHOLTZ: So since it’s retail, let’s talk a little bit about retail. Gamification is a real big issue. We’ve seen Robinhood do this. We’ve seen a number of other sports gambling platforms doing this. What are your thoughts about gamification when it comes to events trading? LARA: Yeah. I think the gamification question is a very interesting one, because I think it’s less about the asset class and more about the actual platform and the mechanics. So for example, you can trade equities on Robinhood, or Charles Schwab. The conversation about gamification is a lot more on Robinhood than on Charles Schwab, even though the underlying like is the same, you’re trading equities. So we really believe event contracts are — have a very big economic purpose and can be used for hedging and all of those things that we — we talked about. And the gamification would come only in the platform. But we’re very, very focused on building a platform that’s safe, easy to understand and to use, but not — not gamified. RITHOLTZ: So let’s go over some of the type of events that you guys trade. You could — you can make bets on COVID-19 and vaccination, on economics, inflation, mortgage rates, politics, climate and weather, world culture, science and technology. Let — let’s — let’s take some examples from this. I’d love the idea, will the 30-year fixed rate mortgage be above 3.9% on April 15? In other words, if I’m buying a house and closing on it, and concerned that rates might rise, I could take a trade against that and hedge that position. And I don’t have to be a billion-dollar hedge funds. I could just be someone buying a house. LARA: Exactly. I think all of our contracts have economics purpose, and they can really be used for hedging. For example, all of our COVID markets, during the Omicron wave, you could really see like even before the news started reporting it, the amount that it was taking up of. And then we’ve talked to the users, and they are, “Oh, wow, like I — I might not be able to go back to school. I want to hedge like that — that situation and all of that.” So a lot of the contracts I’m very interested in, for example, is the half point rate hike for — for March. I think it’s — it’s a market that went up a lot during, I think, one of the — there was some news that that it was going to go up … RITHOLTZ: Right. LARA: … by that. And then it went down again. And — and other ones are GDP and inflation, really just getting into the economic situation we have nowadays. RITHOLTZ: Number of Americans — so these are all “yes or no” contracts that — that’s … LARA: Right. RITHOLTZ: … pretty clearly determined. It’s black and white. Will 254 million Americans be vaccinated by May 1st? But I saw a contract, will America achieve herd immunity by September 1st? Who is the determiner of whether or not herd immunity — how do you define those terms? LARA: Yeah, that’s a great question. All of our markets are like legal binding documents. So they’re like 40 pages determining what the real rules are, to really make sure that there’s no room for indeterminacy or anything of the sort. So this market, specifically, I’m not exactly sure. I think it’s definitely the CDC or some number around there. But if you – like, all of our rules, if you go to our rulebook, it has very specifically defining where — which number we’re using, how we’re using, which target, if it has to be above or below a certain number, and it ends up being very determined. But for COVID markets, we’re using CDC numbers for — for some of our sources. RITHOLTZ: So I mentioned world culture, that’s kind of interesting. Is there a lot of activity in who’s going to win Best Picture or who’s going to be the Best Actress at the Oscars? How — is that a seasonal thing when — each year or how does that trade? LARA: Yeah. Launching the Oscar markets were – it was very important for us because they were the very – very first regulated derivatives, I guess, in the entertainment industry and Academy Awards. We have traded more than 150,000 contracts … Ryan Wyrtzen: Really? LARA: … in the Oscars so far. RITHOLTZ: Wow. LARA: … and it’s only been a couple of weeks. And we really expect the — the trading there to — to be a lot higher, closer to — to the ceremony … RITHOLTZ: Right. LARA: … or during the ceremony. But it’s interesting, a lot of people say that the Oscars are — are dead or irrelevant. But the movie industry is so big too nowadays, that there’s so much — so many people that are so impacted by the results of these awards, and things of that sort. And yeah, on the seasonality point, I think that the interesting thing about the entertainment industry is that you have awards, for example, like the Oscars or the Grammys, and we also have markets on. But you have weekly things, for example, album, sales numbers … RITHOLTZ: Right. LARA: … Billboard charts, and things like that, that we offer markets on every week and have a lot of room for like modeling and alpha, and things of that sort. RITHOLTZ: So — so I know studios spend a lot of money on marketing and promoting, leading up to the Oscars. Because if a — let’s say a small independent film wins Best Oscar, it seems a huge — it gets a huge uptick in subsequent box office and — and other sales or streaming rights. I’m wondering if part of their marketing plan is going to include hedging on Best Oscar. They can not only spend, you know, a million dollars on promotion, they could buy a contract that offsets not winning Best Oscar. LARA: Yeah, that’s our goal, is to get all of them to come and really hedge all this risk that they have. RITHOLTZ: So — so where’s the volume today? Where are you seeing the most amount of activity? Is it — is it inflation and Fed activity? Is it GDP? What — where — where’s all the money flowing in on your platform? LARA: Right. It’s actually interesting, because when we launched, we really expected it to be category specific or concentrated in specific categories or economics, entertainment, transportation, technology. But it really is about what — what the news are. So what’s top of the New York Times? What’s in the newspaper the whole day? And what’s in the news? And right now, as you mentioned, the Fed March meeting is — is very — is a very — it’s a market with a lot of … RITHOLTZ: It’s live. It’s hot. LARA: Right. It’s very hot. Yeah, for sure. But for us, we’ve — we’ve seen this, like news-based activity lot, like the Omicron wave, as I told you. When the infrastructure bill was passing, there was a lot of activity over there; or when Jay Powell was going to get renominated, there was a lot of activity in that market. So it’s really about what’s in the news and what people see their risks associated with, and where they think there’s most room to make money. And right now, the Fed rates, people are really disagreeing on that. And there’s a lot of volume and volatility on that market. RITHOLTZ: So — so you guys didn’t exist when Brexit had come up. That was before your time. But you have been around with Russia and Ukraine, and I noticed there’s not a lot of activity there. Why not do a futures contract on will Russia — it’s obviously too late today. But in January or December, you could have done a “Will Russia invade Ukraine by February 1st, March 1st, April 1st?” LARA: Right. We avoid any contract that’s related to war, terrorism, assassination or — or violence of any kind. We don’t want to have those — those markets on our platform. But we do have markets that are adjacent to that. So for example, markets on the price of ruble or — or the price of oil, natural gas in the U.S. and Europe. So we have markets that are adjacent. We just don’t want to have markets directly related to war, terrorism, assassination, or those things. RITHOLTZ: Makes sense. You don’t want to incentivize anybody to misbehave. LARA: Right. Exactly. RITHOLTZ: In the past, I’ve heard futures described as a marriage between hedgers and speculators. So if you’re an airline, you want to hedge the price of oil. But someone got to be on the other side of that trade, so incomes speculators. Are you seeing that same sort of relationship amongst Kalshi clients? LARA: Yeah. I think Kalshi is one of the most pure forms of exactly this hedging and speculation match. I think one – a very simple example to understand this, if you think of rain in New York City, right? Like, you can have like an ice cream truck buying – an ice cream truck will be really — really hit if — if it rains for like a lot of days, because people will buy less ice cream. So they can buy a “yes” contract to really hedge that offset that they have. On the other side, there can be someone that is going to speculate, and seeing there’s a forecast for 20% rain in the next couple of days and they are willing to take the — the “no” side because they think that there’s only a 20% chance it’s going to rain and — and it seems like they can make money. So then you can really have a match of like people that actually need to have a contract for hedging, almost like insurance, and people who – who because of forecasting and probability and — and what they think the fair value is, is going to take the other side. And then at the settlement, for example, if it does rain, it ends up being that everyone is happy because the speculator makes money, because they were correct. No. RITHOLTZ: Right. LARA: Right. RITHOLTZ: The — the hedger is protected against the event. LARA: Right. Yes. Right. RITHOLTZ: And the speculator won the trade. LARA: Right. Exactly. And exactly, you — you got it totally right. RITHOLTZ: So — so let – that raises a really interesting question. Who are your clients? Are they hedge funds and institutions? Are they retail investors, or is it a whole spectrum of people? LARA: We really focus now on — on retail. And our — our biggest amount of users right now is the traditional option trader, like informed retail options traders. But the way that we see this — this growing is we want to keep growing within the retail trading and options trading community. And then our next step is getting brokerages on board so that you can now go and trade on event contracts through your interactive brokers or e-trade account. And then after that, building enough liquidity to start bringing more prop shops in and — and smaller firms and then hedge funds and — and then institutions, and maybe we can have maybe a Burger King hedging, I don’t know, price of plastic straws or something like that. RITHOLTZ: So — so the platform eventually becomes an exchange? LARA: Exactly, exactly. I think we — we see it as a buildup of liquidity from — from retail that’s like smaller amounts, but — but — but higher velocity to — to hire bigger and bigger institutions, all the way to become like a full-fledged financial exchange like the New York Stock Exchange or CME. RITHOLTZ: So let’s talk a little bit about how you guys, you and your co-founder, created Kalshi. You kind of were the opposite of Facebook. You know, Mark Zuckerberg famously said, “Move fast and — and break things.” Companies like you and Coinbase and BlockFi spent a lot of time getting approval from the regulators. Tell us a bit about why you took that approach as opposed to moving fast and breaking things. LARA: Yeah. I think a lot of times people are making the short-term trade-off for speed. And in finance, I think it’s different. You can – obviously, you go to market faster if you choose the unregulated route. But with finance, there’s been like a lot of historical examples of unregulated platforms getting meaningful volume and then being shut down by regulators, because they weren’t properly regulated and doing things right from the start. We really think that the opportunity really shrinks if — if you don’t take regulation into account, because then you can’t get real money in the platform. You can’t get real good partners, as we just talked about brokers, market makers, hedge funds onboard. Sometimes you can’t even offer products to U.S. customers. It really boxes into something small, very quickly. And that’s — for us to be the New York Stock Exchange for events, because that’s our goal, the only way to do that was to do it right from the start, going through the regulated path, and — and eating on the cost of the two years and a half waiting, but — but making sure that we’re set for success. RITHOLTZ: So your — your co-founder, Tarek Mansour, he was an equity derivatives intern at Goldman Sachs in 2016. The same year you were a quantitative trader at Citadel Securities. So you guys both had a pretty bright career path. Had you not decided to go out and launch this whole new platform? Tell us what motivated you to say, “Goldman, Citadel, that looks too easy. Let’s — let’s launch a — a new startup.” LARA: Well, that — that’s funny because actually most of our MIT time, we were both very focused on just getting finance jobs and never even thought about starting a company. But yeah, we were both very interested in math, financial history, finance from — from the very start of — of our school years and — and we worked with various financial firms. As you mentioned, Tarek worked at Goldman. I worked at Bridgewater, Five Rings Capital, which is a small prop shop, and then Citadel Securities. At those internships, we really saw the behavior that we say is the Kalshi behavior over and over again. It’s like firms making trading decisions based on events. As we think the European Central Bank is going to raise rates, let’s take this massive position, or really find the structure to make that work. But the idea really crystallized in our heads when we were working, both together, at Five Rings. And there, we were playing this game almost the whole day. It’s called the “maker market” game that people — that everyone would be putting like bids and offers in the probability of something. And then the other person could only tighten the spread or — or trade against you. And there was a single — there was a day that we were just trading — playing this game the entire day. And then I — I don’t remember exactly what market it was, but I took a massive position on Trump doing something. I don’t remember exactly what it was. And everyone thought I was crazy and debated me a lot on that. But I ended up being right. And then when I was — we were walking back to — to where the interns were staying, it was stuck in my head, like why isn’t there a place for people to do this? Like, we love doing this? We do this the whole day. Like, we see in every place we work at, like very big positions, people are trading based on events. Like, why is there no place to do this? And then I sat down and started talking to Tarek about it. Like, why isn’t there — why don’t — why don’t we do it? And we stayed the whole night up talking about it. And it was just something we were so passionate about from the finance side, the product side, everything we always loved. And if there was going to be someone to figure it out, it was going to be us. It just then leaves us the idea for another six months, up until we were like, OK, like, this is a calling, we have to do it. RITHOLTZ: So — so when you say your desks are – and you guys are trading back in 2016, trading events, you couldn’t credibly bet any sort of volume on events like Kalshi does today. You had to go to secondary or tertiary markets. So you’re betting on gold if you’re thinking about inflation. LARA: Exactly. RITHOLTZ: You’re betting on oil if you’re concerned about war. It’s – it’s always once removed, which raises the issue. Even if you’re right, you may not express itself in a market the same way that the bet was supposed to go. LARA: Right. Exactly. I think that in the beginning of COVID, you had this exact thing happening with — with the economy and how you would think about the S&P. And the beauty about event contracts is that it’s direct exposure in what you think. There’s not like a lot of variables for you to keep track of or — or think about of things that can go wrong. That’s why we also think it’s very – it’s the most like natural way of investing, especially if you think for retail. They can’t like keep track or have full desks of people trying to understand what’s going on. It’s a lot easier to do when you have one opinion, and you have a very clear way to get exposure on what you believe in being right or wrong. RITHOLTZ: So — so you’ve spoken about the gambling industry and how incentives are somewhat cloudy. How does your platform correct for that? LARA: Right. The key part about gambling is that the house takes a position in the bets. So the house has an interest on the outcome of — of the bet or — or the market, if you want to call it that, but it’s more just the bet. We are just a financial exchange. So we — you can think of Kalshi a matching agent. We match people that believe something will happen with people that believe something will not happen. If they have equivalent prices, we match them. So we have no interest in whether the market will go away a certain way. We do have an affiliate trader that’s there to provide liquidity so that people can trade, especially as we start the exchange. But the exchange doesn’t take any positions ever. We’re simply matching other participant orders. So there’s no conflict of interest between us and our members. RITHOLTZ: So — so when you look at a racetrack and the odds are set on horses, those odds don’t quite add up and the shortfall is the house take. So it’s never quite 50/50. What does it cost to trade on this platform? What — what’s the — so in other words, if I’m betting a $100 that something is going to happen and I win, do I get $200 back or how — how does that work? LARA: Right? So — so the way that it works is that the “yes” and the “no” prices are from 1 to 99 cents, and whoever is right gets $1. So let’s say I’m buying a “yes” for 40 cents, it means there’s someone buying a “no” for 60 cents. And if I am correct, I make $1, which means I’m profiting 60 cents which is from my counterparty, RITHOLTZ: Right. What – what’s the cost of that trade? Meaning, how does Kalshi make money, and I assume since it’s fully collateralized, there’s a float. That’s going to be a good source of revenue over time. LARA: We don’t make money on float. All of our — our — all of them, user member funds are in a fully regulated CFTC Clearinghouse, which is FTX derivatives, the U.S. derivatives, they are clearinghouse. And we make money on a transaction fee. So we have a small transaction fee that varies on the price of the contract. RITHOLTZ: But what is it averaged ballpark? What does that cost? LARA: I think it’s less than 1%. RITHOLTZ: All right. So, we will have a conversation after we’re done, and I will show you that – I think it was Schwab. When they moved to free trading, their float became 57% of the revenue. So we’ll have a conversation. We’ll see if we can help raise your — your revenue target and – and we’ll go from there. Because especially — it’s one thing if you’re looking at events that are days and weeks out. But if you’re making bets on will 2020 be the hottest year in history, hey, you’re sitting with that money for 12, 11, 10 months. There’s a lot of top line to be gained from — from a little float. We’ll — we’ll work that out with the CFTC. That will be — that will be easy. You guys raised $36 million in a Series A. Sequoia Capital was the lead, probably the most storied venture capital firm in Silicon Valley. Charles Schwab, not the entity I was talking earlier about Charles Schwab in the float. But Mr. Charles Schwab was an investor. Henry Kravis is an investor. Silicon Valley Angel is one of the early investors. And were you with Y Combinator when you were first launching? LARA: Yeah. RITHOLTZ: So — so that’s quite an esteemed list of — of people who said, “Hey, there’s some value here.” Tell us a little bit about the experience at Y Combinator and then doing an A round with some really boldface names. LARA: Yeah. Our experience at Y Combinator was actually very different from most of the other startups. Like, we were measuring regulatory traction, and other startups are measuring user growth, or revenue or — or things — things of that sort. Yeah, and about the Series A, getting a DCM was — was a key part of — of that Series A. I think Kashi is really one of those asymmetric type of investments. We are going to face obviously a lot of challenges and — but we — if we execute against those challenges, we’re going to have massive outlier potential. And we were really trying to find partners and investors that really understood the long-term vision of the company, and share that obsession that we have with event contracts and — and building this entire trading ecosystem. So Alfred from Sequoia is one of those people. He — he did a PhD in these types of markets. He really, really understands it and sees the potential. And obviously, it’s — it’s a Sequoia Sequoia, as you said. RITHOLTZ: Right. LARA: So that was – that was definitely something we thought about. But — but Alfred, specifically, has historically invested in a lot of like paradigm shifting companies like Airbnb and DoorDash. So we really thought it was a good — it was a good fit. And then after Sequoia was our lead investor, we were really trying to fill the round of – with Wall Street investors that could really help us navigate this industry. So yeah, Tarek, my co-founder, he’s obsessed with barbarians at the gate. So — so when … RITHOLTZ: Hence, Henry Kravis. LARA: Right. So when — when one of our seed investors, Ali Partovi, said he could intro and — and we could talk to Henry, I think Tarek was just like absolutely fascinated. And they had a fantastic conversation. He was very interested from — from the very beginning. And with — with Charles Schwab, it was something similar. It was also Ali Partovi introing us to — to him, also very interested in from the start, and he actually told us that our early days at Kalshi looked very similar to his early days starting Charles Schwab. So that was very exciting. And — and yeah, they help us so much till today so it’s fantastic. RITHOLTZ: The funny thing about Schwab is people don’t realize the guy you see with the gray hair in commercials, that’s Charles Schwab. That’s not an actor. LARA: Right. RITHOLTZ: He really exists and has been running the company. Now, I think he’s chairman. But that was really him for — for a long time. So — so let’s talk a little bit about event hedging. And I like this quote, “These markets are a little like an aggregator of public opinion in real time.” So — so what are the implications of this? And is that the sort of stuff your lead investor at Sequoia was studying when he went to school? LARA: Right. Yeah, this is a very important part of our vision. Over time, we really want Kalshi to become the source of truth for forecasting these events that we have markets on. Because of the prices at Kalshi go from 1 to 99 cents, they directly translate to the probability of the event happening. So let’s say the market might be saying there’s a 20% chance there’s a recession this year. It means that 20 cents means that there’s a 20% chance that the market believes there’s a 20% chance … RITHOLTZ: Right. LARA: … that there will be a recession this year. And the amazing thing is that there’s a lot of theoretical and empirical evidence that they are the most effective and most accurate ways of forecasting the future. They’re way better than polls, way better than like pundits on — on the news, trying to say what’s going on. And it’s mainly for two reasons. I think the first one is because when people put money where their mouth is, they are more — more likely to say what they really think and actually do research and everything. And the second one is that markets really aggregate the wisdom of the crowds. You’re getting a lot of different people’s opinions, when they put money behind their opinion, and really aggregating data, and which makes this a very powerful tool. And I mean, any market lover understands what I’m saying. And yeah, making — and — and part of our — our vision and what we really want to do long — long term is make these forecasts core to people’s lives. It’s really part of our mission. With — with event contracts becoming more widespread, we really hope that people will use data in their lives to prepare better for the future, address uncertainty, inform themselves better, and like try to address a little bit of the very biased world and not very data-driven world that we live in nowadays. So we’re trying to get started with that. We’re really trying to get — we have market tickers like any other equity or things like that. We have tickers for all of our markets. So we’re trying to have tickers and prices to be used by news and things of that sort. So we really try to get this very important data, that we believe is very important data out there. But for Alfred specifically, I think he was doing more than like mathematical and like research. He was doing a stats PhD, so somewhat related to this, but not really on the — on the — on this side, but yeah. RITHOLTZ: So — so let’s — let’s talk a little bit about prediction markets that are out there. Historically, they’ve only done a so-so job, partly because they’re not very broad. They’re not that very deep, and the dollar amounts that are traded had been modest. I saw an overlay of about half a dozen different prediction markets before the Russian invasion of Ukraine. And you would think they would all be kind of similar, but they weren’t. They were all over the map. Do you have to get to a certain scale that will fix that problem of prediction markets being kind of thin and easily — I don’t want to say manipulated, but one big trade really has an impact on — on how those markets trade. LARA: Right. Exactly. I think we need a — a base level of liquidity and — and volume for — for the forecast to really work and be really useful. And a lot of these like other prediction markets out there, as — as we talked about, they’re unregulated. They have — they’re very new. They just pop up, especially the crypto ones every other day. And it’s hard to build liquidity and real proper volume like that. But we really think that prediction markets are the way to go to have these — these very good forecasts of — of events, but it needs liquidity and needs volume, and that’s what we’re working on. RITHOLTZ: Really kind of interesting, which raises the question, how are you going to scale this up? How are you going to get to 100 million and then a billion, and then who knows what from there? LARA: Right. We have a lot of ways to — to scale the exchange. It’s kind of what we talked about with — with building up liquidity. Right now, we’re really focused on retail. So getting — we have a lot of option traders, or like what we call informed retail traders in the platform, trying to go in more – deeper into different communities, and trying to get them in to test the platform, things of that sort. And then the next step for us is getting brokers in to offer our markets in their platform, so e-trade, interactive brokers, all of those. And then bringing up the volume, we can bring up like actual liquidity providers, prop shops, hedge funds, and then up until, I guess, insurance companies even offloading some risk or — or like actually big institutions, natural hedgers, bringing them in. So the way that we’re seeing it is really starting to build of retail with getting more and more of the current users that we have, which are option traders, and having more retail as we go to the — to the, I guess, brokers. RITHOLTZ: So — so how big can this get? I mean, is this ever a billion dollars a month? How — how large can this sort of event hedging scale up to? LARA: Right. So event contracts are a lot more like tangible, relatable and — and more direct, as we talked about, then all these other assets that — that preceded it. So we really think when we actually plug it in the financial ecosystem, it can properly scale. Obviously, it takes a lot of time to get there because we need to view the entire ecosystem around events. RITHOLTZ: Right. LARA: It’s a completely new thing. But once it’s properly plugged in the financial system, I can give you some numbers to give some idea, right? I think you mentioned that in the beginning of the CFTC regulating a trillion-dollar industry, like grain futures are $7 trillion industry. RITHOLTZ: Wow. LARA: Commodities, 20 trillion. Interest rate swaps are around, I think, $500 trillion. So not exactly how big the market is, but I think as we expand event contracts, it definitely has a potential to be one of these. RITHOLTZ: Right. Interest rate swaps are $500 billion or trillion? LARA: Trillion. RITHOLTZ: Really? LARA: Right. RITHOLTZ: That’s the notational, nothing is going to get offered? LARA: Right. Yes. You got that point. RITHOLTZ: That — that’s a giant amount of money. LARA: Right. RITHOLTZ: So — so really, startups have a tendency to have this defining moment in their lifespans, where they sort of either pivot or just a moment of clarity, and you could see the whole roadmap laid out. Did you guys have that sort of defining moment at Kalshi? LARA: I would say the biggest — the earliest defining moment we had was actually — before we really started the company, we went to a Y Combinator hackathon. Because before we were like fascinated by it, but we didn’t think it was like going to work. It’s like — it seems so complicated, and like, are we crazy? I think that was the big question in our head, like are we going crazy over here? Then we went to Y Combinator for a hackathon. And there were like these teams with like bunch of servers, crazy computers like — and it was just me and Tarek with our like Macbooks, like try to — to code like a demo of what we were talking about. And then we first presented to Michael then, the CEO of YC and he really didn’t like what we were saying from the beginning. He cut us. Like the first five seconds, he’s like that, like “This is illegal,” like, “What are you doing?” And then we will get very upset. We went in like we – I think we — Tarek even started drinking beer. He’s like, “There’s no way we’re going to be in the Top 10,” which had to present again. And we ended up being in the Top 10. We presented again, and then we ended up being in the Top 3, which were the winners of the hackathon. And I remember that night, when we were going back to — to our friend’s place where we were staying in San Francisco for the hackathon, we were like, “Wow, like maybe we aren’t crazy. Like, we should — like maybe like people believe in what we’re doing.” And it was a very like happy moment for us. And I think right after that, we actually got into the Y Combinator batch. And it was one of the happiest moments we’ve — we’ve had — we’ve had of the company. So that was really like motivating and encouraging, because as I told you, we never thought about being founders. We thought about being like he was going to be — we were both going to be traders full time. So it was like a big shift for us. So that was a very exciting moment. RITHOLTZ: Really interesting. Let me throw a couple of curveballs at you. You and your co-founder, Tarek, both were named to the Forbes 30 Under 30 list in — in the finance category. Tell us a little bit about that. What was that experience like? LARA: Yeah. No, it was very excited. We were very honored to be — to be — to be nominated, especially being like the head up of the — of the finance category. We were really excited after all the work we’ve done. And actually, a funny story is that because of the Forbes 30 Under 30, I went viral in Brazil for a little bit, because the Brazilian Forbes wrote a — wrote a piece about how a Brazilian was in the American Forbes 30 Under 30 and that — because it’s very rare to have Brazilians in the list here. So that was — that was — that was a funny story. But yeah, because of the Forbes 30 Under 30, we also ended up ringing the opening bell at the NASDAQ, which was very exciting. RITHOLTZ: Interesting. LARA: Yeah. RITHOLTZ: And one more — one more curveball. You were a ballet dancer with the Bolshoi. You studied ballet. Tell us about that. LARA: Right. So very different from what I do now, for sure. But I’m from Brazil, originally, and I just came to the U.S. for college. And most of my life before college, I was split between ballet and school. What — what I really loved about ballet was intensity of it all. It was extremely hard to get to the top. It’s extremely competitive. And there’s nowhere to hide, you need to be completely on, you need to give it your all. And yeah, and I — I studied at the Bolshoi Ballet School and it was extremely intense. And — and we had to be extremely disciplined, like measuring our food down to like a four puffs of strawberry before this rehearsal, to be able to get there. But that was –that was one part. And the other part, my — my parents are both engineers and have stem backgrounds. So I was surrounded by that outside of ballet, doing like Math Olympiad and all of that, I also had to get 100 on everything on the math and science side. So I used to do like normal school, I guess, from like 7:00 a.m. because Brazil school’s hours are different. so 7:00 a.m. to like 1:00 p.m., and then ballet from 1 – like 1:30 p.m. to like 9:00 – 10:00 p.m. And then I would actually go study. So that was a very intense part of my life, but I think it really set me up for — for being able to go to MIT and — and — and enjoy everything there. And it’s something that Tarek is very similar to me, he was actually a professional skier before going to college. And — and we have very similar backgrounds. And I think that level of intensity and — and discipline is really what helped us get through the regulatory process and be where we are today. So tough times, but it’s good now. RITHOLTZ: I — do the same thing. I measure my food input down to the quarter strawberry. And you could see it’s how I maintain my girls. So — so we only have certain amount of time left. Let me jump to my favorite questions that I asked all of our guests, starting with what kept you entertained during lockdown? What were you streaming, watching or — or listening to? LARA: Right. I listened to all and — and I’m very into American politics nowadays. So I’m finishing up the 10 American Presidents podcast. But on TV, I think I’m more mainstream. So I just love Succession, House of Cards, West Wing, and so on. RITHOLTZ: Let’s talk about your mentors who helped shape your career. LARA: Right. So I think at MIT, I had two professors that were very impactful in my career and to me. I think the first one was Patrick Winston. He was my advisor and professor, a lot of artificial intelligence classes. He really helped me navigate MIT and set me up to — and set my mindset to where I wanted to be, to like really psychology. And the other great mentor was Peter Kempthorne. He’s also professor of stats, and really, I started being interested in finance in his glasses. And funnily enough, he’s actually one of directors of — of Kalshi nowadays, because we kept very close contact. And we talk a lot to him about like the dynamics of markets and all the stuff we talked about. And since we started the company, I think our biggest mentors have been Michael, the CEO of YC. Up until today, he’s helped us so much. And Ali Partovi, who’s — who runs Neo, he’s one of our seed investors. And they have been really instrumental in like making us better founders, not just like making the company succeed, but better founders and how to like deal with employees, growing — like growing pains, negotiation, all of those things that, you know, like MIT nerds didn’t really know what to do. RITHOLTZ: So let’s talk about books. What are some of your favorites and what are you reading right now? LARA: Right. Some of my favorite – my favorite book is this book called “Americana,” but it’s not the novel. It’s actually the 400-year history of American capitalism. But whenever I say Americana, everyone thinks is the novel. And the other one is this book called predict — “Predictably Irrational,” which is … RITHOLTZ: Dan — Dan Ariely? LARA: Right. Yeah. And it’s — it’s very — some — it has a lot to do with what Kalshi does and I think it’s one of the early books I read on — on prediction markets and decision-making, and I thought it was a fantastic book. And at the moment, I’m finally — Tarek will be very happy to hear this. I’m finally reading “Barbarians at the Gate” after he told me for years that I should, but I barely started, so yeah. RITHOLTZ: And Americana is a Bhu Srinivasan, am I pronouncing it right? LARA: Right. He’s that. RITHOLTZ: He was a guest here a couple of years ago. I love that book. That book is just amazing. LARA: That’s book is fantastic. Yeah, it – yeah. RITHOLTZ: Those people think that, oh, all these companies were, you know, freestanding. It was a public private partnership … LARA: Right. RITHOLTZ: … for a long time. That — that is a fascinating book and I’m surprised someone, as young as you, has found it. It’s sort of off the beaten path. LARA: Yeah. No. It’s — it’s a fascinating book. It made me — especially not being American, I think it made me understand the country and how it works so well, I think, way better. RITHOLTZ: So — so this is the first time I’m going to ask this question of somebody who is so recently out of college, but you’re 25 now, is that right? LARA: Right. RITHOLTZ: So what sort of advice would you give to a college student or a recent college grad who is interested in a career in either startups and technology, or finance and derivative training? LARA: Right. I think the finance industry is very — there’s a very traditional path that people can take. And what really helped me and — and Tarek understand and — and really come up with the Kalshi idea and — and — and understand it and work on it was that we got a lot of exposure to a lot of different types of firms and a lot of different types of roles as well, like we did. I did more of the engineering side, then a little bit of the trading, then a bit of research. And Tarek did like all types of different trainings, because he also worked at Citadel, and Five Rings, and Goldman. And I think that giving yourself a lot of breadth, especially when you’re in college is very important to just understand the industry as a whole, understand when there are gaps, and — and seeing — like finding patterns, like how we found the Kalshi behavior. So I really think it’s about putting yourself out there, trying to learn different things, do different things and — and trying to get a global vision of — of what the industry is and why you want to do, and — and not be too tied to like the traditional path of like entering as like this level and then going up in a big firm and — and things like that. RITHOLTZ: And our final question, what do you know about the world of trading, and hedging, and investing today that you didn’t know, what do I say, four years ago when you guys were first starting out? You’ve been doing it since 2016, so let’s call it six years ago. LARA: Right. Yeah. So what we’re really doing is — is enabling trading and investing. But if I were an investor, what I think I would have liked to know a couple of years ago is that bold bets are — I would take a lot of bold bets. I think generally that’s – the bets that seem ridiculous at first and there’s a lot of debate, then there’s no way that it’s going to work, are usually the ones that are achieved, like the large outlier results. Definitely, I’m biased because Kashi is hopefully one — is going to be one of those bets for a lot of our investors. But I really think it’s about seeing what the world can be in the future and — and taking bold bets to get there. I think a couple years ago, I’ll be very — if I were an investor a couple years ago, I would be very scared to do that. But now, I would think that’s the way to go to really do meaningful investing. RITHOLTZ: Quite fascinating. We have been speaking to Luana Lopes Lara. She is the co-founder of derivatives trading marketplace, Kalshi. If you enjoy this conversation, be sure and check out any of our previous 400 interviews we’ve done over the past eight years. You can find those at iTunes, Spotify, wherever you get your podcast fix. We love your comments, feedback, and suggestions. Write to us at You can sign up for my daily reads at Follow me on Twitter @ritholtz. I would be remiss if I did not thank the crack staff that helps put these conversations together each week. Sean Russo is my research assistant. Mohamad Rimawi is my audio engineer. Paris Wald is my producer. Atika Valbrun is our project manager. I’m Barry Ritholtz. You’ve been listening to Masters in Business on Bloomberg Radio.   ~~~   The post Transcript: Luana Lopes Lara appeared first on The Big Picture......»»

Category: blogSource: TheBigPictureApr 19th, 2022

"Nice Narrative" But No: Why One Strategist Thinks Zoltan Pozsar"s "Bretton Woods 3" Is Never Going To Happen

"Nice Narrative" But No: Why One Strategist Thinks Zoltan Pozsar's "Bretton Woods 3" Is Never Going To Happen Ever since Zoltan Pozsar started echoing Zero Hedge circa 2010, and in note after feverishly-drafted note, the former NY Fed repo guru has been writing about a coming monetary revolution in which commodity-backed currencies such as the yuan become dominant and gradually displace the world's reserve currency - the US Dollar - which slowly fades into irrelevancy in a world where commodities are the fulcrum asset and where paper wealth is increasingly meaningless, there have been three reactions: i) those who have no idea what Zoltan is writing about (that would be about 98%), ii) those who agree wholeheartedly and believe that the USD should be dethroned as a reserve currency yesterday, and iii) those who are just a little bit "displeased" with all the attention the strategist (who has correctly called every major crisis and turning point in markets in the past decade) is getting and are starting to lash out at his stream of consciousness. Rabobank's Michael Every, himself a geopolitical status quo skeptic yet clearly misaligned with Zoltan as to what happens next (and in reality a believer that the broken system we have now will be the broken system we have for a long, long time to come), is in group three, and following a handful of "subtweet" shots across the Zoltan bow (which have barely registered in the financial media, especially Bloomberg, which Every continuously mocks yet reads religiously) the Rabobank strategist has (bravely) penned the closest thing to a Pozsar rebuttal we have seen.  Is he right, or is he just unhappy with how much attention Pozsar is getting? We leave it to readers to decide, and republish his latest note, "Why "Bretton Woods 3" Won't Work" in its entirety below. Why ‘Bretton Woods 3’ Won’t Work Nice narrative: but it’s just ‘mercantilism’ Summary Sanctions on Russia are seen as accelerating a dramatic shift towards a new global commodity-focused ‘Bretton Woods 3’ architecture However, this is actually a very old economic argument: mercantilism History, logic, trade data, and economic geography all show the US can do well in that kind of realpolitik environment By contrast, the opportunity to shift global trade flows away from USD to others is limited: fundamentally, neither CNY nor commodity currencies are set up to rival USD globally The USD will therefore retain its global role despite the ‘Bretton Woods 3’ hype Many bad sequels The world is experiencing dramatic changes in its security, political, economic, and financial architecture. Indeed, alongside war in Ukraine we see headlines about ‘Cold War 2’, ‘Bretton Woods 3’, and even World War 3. We will not comment on the risks of World War 3, as flagged by Russians such as Karaganov, given it is impossible to trade for. However, China and Russia are openly trying to build a new world order, which we argued would happen back in 2017: this report focuses on the viability of a global FX architecture remake to a so-called ‘Bretton Woods 3’ (BW3). We argue that: BW3 has an appealing narrative, and we agree with a lot of its core arguments. However, it is not a new concept at all, but an old one – mercantilism. That’s an environment that still suits the US and allies. As such, we can look at history, logic, trade data, and geoeconomics to see that BW3 will not work as sold. We may see some USD trade shift to CNY via offset or barter. However, the most this would cover is just 3.3% of global trade, vs. CNY’s current 2.6% share of global FX reserves. The more likely shift is just 1% of global trade. With much of this being offset, the impact on $6.6trn daily global FX markets would be negligible. Overall, the USD will retain its global role despite the BW3 claim of a new architecture ahead. The pitch Let’s first run through the key arguments made for B3W: (i) High inflation and supply-chain logjams mean Western central banks and economies can no longer rely on quantitative easing (QE) as a policy crutch: you cannot print commodities. More QE now just means more inflation and currency debasement. (ii) States instead need control of key commodities and supply chains, including maritime logistics, with military might required to secure them. (iii) Sanctions on Russia and possible secondary sanctions on others have “weaponised” the USD, euro (EUR), and yen (JPY). Fewer countries will want to hold such reserves if they can be frozen or appropriated, as happened with Russia and Afghanistan. These trends are accelerating a global shift to alternative FX, payment systems, and trading patterns. (iv) We will see a new commodity- and supply-chain based FX architecture replace the USD-centric system: Russia just called for BRICs countries to create exactly such a new FX system. (v) Commodity currencies and China’s renminbi (CNY) are seen as major winners in this new order. A good narrative isn’t enough Markets like a good narrative. BW3 has one given: high inflation and commodity prices; central bank impotence; concerns over the imminent withdraw of US QE – and fears over what having to restart it would imply; and talk of geopolitical and geoeconomic realignments and fracturing. Moreover, BW3 does not require the audience to suspend much disbelief. Relative US political, economic, financial, and military muscle has declined in recent decades. Even US soft power is fading: and China’s movie box-office has been larger than the US since 2018, dominated by local films. The famous ‘Sunset Boulevard’ line from a fading movie star is, “I Am Big. It's the Pictures That Got Small.” The US is still big, but others are no longer as relatively small as they were. However, BW3 is not new. Indeed, it takes us almost full circle in time and FX structure (Figure1). In short: The post-WW2 original Bretton Woods system had USD tied to gold in a divided Cold War world economy with stringent capital controls. That lasted 26 years before collapsing due to the Triffin Paradox (which we shall return to later) and the shift to fiat USD in the 1970s. Then we saw evolution to the recycling of so-called ‘petrodollars’ as oil prices surged following the 1973 Yom Kippur War. The end of the Cold War saw globalisation and higher USD capital flows into emerging markets... and the resulting Mexican (1995) and then Asian Crisis (1997-98) That led to the de facto BW2 of USD FX reserve hoarding and recycling, as emerging markets opted to run large current account surpluses rather than deficits. The 2000’s US-steered hyper-globalisation saw a boom in funding in the five-decade old Eurodollar, via both bank and shadow-bank channels. The Global Financial Crisis (GFC) and subsequent slump in Western growth saw a long-run shift to a reliance on central bank QE to try to stabilise markets and economies. That ‘new normal’ approach was brought to an end by populist discontent with the inequality it drives, and the fiscal response to Covid: yet Covid also showed reflationary fiscal policies are not possible without national control of commodities and supply chains. War in Ukraine is pushing us into Cold War 2 - and non-USD ‘reserve currencies’ backed by commodities. In short, BW3 is not forward, but backwards looking. We have seen many elements of it before. Yet past attempts at building BW3 frameworks created enormous problems! The post-war Bretton Woods timeframe left excludes it, but one could look to the fragmentation of the global monetary order and trading system in the 1930s, for one key --and worrying— parallel: however, that saw the end of the gold standard, not a move towards one. Indeed, we have long taken a historical and structural view of markets that leads us to agree on the BW3 view of the ineffectiveness of QE; the geopolitical importance of logistics; the necessity to control supply chains and trade to maintain currency power; and of the ongoing fragmentation of the global economy. We even linked this all to FX structures back in 2015. Furthermore, we agree we are heading not just to Cold War but to global Great Power struggles in which trade and currency will play key roles. Yet taking this kind of view, it becomes clear that BW3 will still work more in the USD’s favor than for any rival currency being touted. We will now look at the historical, logical, structural, trade- data, and geoeconomic reasons to briefly summarise Why B3W Won’t Work (WBW3WW). WBW3WW 1: history The global economy has seen commodity currency foundations in the past. The most obvious was the gold standard on and off 1815-1971, and in its purest form from 1815-1913. There are many key lessons we can draw from this period for BW3 proponents. The likes of Argentina saw more FX stability under it that is has since (Figure 2): and Argentina is still a commodity producer today that might be looking at BW3. However, inflation was only well contained on average by regular deflation (Figure 3). It is unclear that a modern economy would want to see such start-stop price swings. Moreover, a commodity standard restricts excessive growth of credit by either the government or the banking sector. While a positive case for both can be made, would any economy want to embrace that hairshirt approach? On the government side, the current vogue is for more, not less state spending in the name of national security: and for more, not less social welfare to narrow income gaps. Without the latter, the gold standard did not stop the many attempted revolutions of 1848 or 1870 in Europe: rather it encouraged them. One could expect the same under BW3. Russia, which runs a conservative fiscal policy, might be prepared to embrace that approach. However, China cannot. On the private side, China has seen an explosion of debt since 2008: tying itself to an FX commodity standard would mean implosive deflation in Chinese asset prices if new lending was capped. Moreover, China’s total public sector debt, including local governments, is already that of a European state, and the IMF says its augmented fiscal deficit was a staggering -16.5% of GDP in 2021. Geopolitically, the gold standard was zero-sum. With a (mostly) fixed stock of gold, states either gained the metal through trade, which was also zero-sum, or war. Free trade was tried at British behest, but Europe quickly learned the secret of British success was actually mercantilism and imperialism. It followed suite, with a lag – and so did WW1 (Figure 5). Indeed, ‘Debt: The First 5,000 Years’ (Graeber, 2011) echoes Polanyi (1944) in arguing past historical periods of exogenous money, such as gold, saw more war compared to endogenous, fiat/debt-based periods of expansion. Of course, when debt-based expansions end similar problems can arise, as we see today: yet embracing a global commodity currency standard would guarantee that outcome from the outset. WBW3WW 2: logic The four logical functions a global FX reserve currency must meet are: (i) store of value; (ii) method of accounting; (iii) means of exchange; and (iv) overcoming the Triffin Paradox. All of these still favor USD over any rivals. Store of value Commodity currencies are either pegged to the USD, in which commodities are priced, or are highly volatile (Figure 6). Unless global commodities are now going to permanently lose that volatility, and volatility is actually increasing in many of them, then commodity currencies will not lose theirs either. No rival global currencies offer the trust of US markets. Yes, USD (EUR, JPY, etc.) are now “weaponised” for Afghanistan, Russia, Belarus, and anyone who supports the invasion of Ukraine. However, CNY is highly politicized, as is RUB, and Chinese markets have seen net capital outflows since the start of the Ukraine War. Do any potential BW3 currencies inspire broad global trust, or just in pockets? High US inflation hardly backs the USD. However, the Fed is flagging rate hikes of as much as 325bp this year and quantitative tightening (QT). That backdrop will support USD: and that is true if that level of rates can be sustained, or if it can’t, and the US (and world) economy falls into recession – taking commodity prices with it. Only if the US re-embraces QE despite high inflation would the USD’s store of value be undermined. We agree that military power ultimately underpins global reserve currencies. On that front, while overstretched, the US still holds primacy, and its allies in Europe, Australia, and Japan are rearming rapidly. By contrast, Russia’s martial prowess has been called into question in Ukraine, and China’s remains entirely untested, despite the incredible growth rate of its armed forces. Method of accounting No other global currencies offer the scale of US markets or its ‘network effect’. Try to talk about trends in global GDP without using USD as the common denominator. In a reflexive logic, the more people who use a currency, the more the currency is used. This is particularly the case in terms of Eurodollars (offshore USD borrowing). The sheer scale --hence power-- of Eurodollar debt means setting up an alternative is a daunting task: even China had $2.7trn of FX debt as of the end of Q4 2021. Indeed, if one presumes USD will be pushed aside, one is logically arguing a lot of Eurodollar debt will default, as few will be able to earn enough USD to repay it. That would mean global market chaos. Means of exchange The USD is welcomed globally, and its high liquidity means low transaction costs. The same is not true for any other potential alternative currencies. Indeed, China lacks an open capital account, which means CNY is not free-moving or freely traded. This is an economic policy choice on China’s part which hugely limits CNY’s global attractiveness. Triffin Paradox The Triffin Paradox is that global demand for a reserve currency forces the country that owns it to run trade deficits. For fiat USD that also means offshoring industry (i.e., via foreign net exports to the US) and, as we now see, rising domestic inequality. There is growing pushback against this within the US, but no idea of how to maintain USD’s reserve status while doing so. Any BW3 currency trying to push USD aside would have to be willing to run large trade deficits too. However, if commodity prices are high, major commodity producers run trade surpluses, stopping the spread of their currency; and if commodity prices collapse, their currency does too, again limiting its global attractiveness. China also runs a large merchandise trade surplus (even if it also runs a huge commodities deficit) in order to support industrial employment, as well as to ensure the stability of CNY via the balance of payments. Combined with capital controls, this further limits any global reserve role that the currency could ever hope to play. How does one earn CNY? How do CNY get into the global system within BW3? WBW3WW 3: structure Fundamentally, BW3 does not work because of the structure of the global economy. The essential nature of commodities has been laid bare by the Ukraine War, but total global trade in them is still far smaller than other goods combined (Figure 7). That is a very low ceiling, or narrow base, to build a new world order on. Perhaps if all commodity exporters were united it might be possible – but they aren’t. Indeed, only a few major food exporters are pro-BW3 (Table 1). One can take out the Western producers: Australia, Canada, the EU, New Zealand, and the US. In terms of energy, there are again major Western producers --Australia, Canada, and the US-- but the majority are located in the Middle East. The US is the traditional hegemon there too. True, this situation may be changing as the US tries to pivot to Asia and is dragged back to Europe by Russia – but it is a huge geopolitical gap for China to fill, even presuming the US doesn’t pivot back. Moreover, global oil markets need a base currency that is: liquid, which CNY is not; freely tradable, which CNY is not; and stable, which CNY only is because it does not meet the other two criteria, and because it is soft pegged to the USD! Even a move to oil priced in a basket of currencies is hugely complex to maintain across all OPEC partners, which is why it has not happened yet. Hence energy producers are seen as ‘floating’ at best but are hardly set to rush to switch the USD for CNY (Table 2). In terms of mineral exporters, there are a large number of floating countries, and the same general cluster in the pro-West and pro-BW3 camps. The simple message is that BW3 has a significant tranche of global commodities behind it, but mainly because of Russia; the West has the same, but because of a broader range of resource-rich economies; and most of the world’s producers are looking on at the prospect of a global bifurcation with extreme discomfort. In short, BW3 does not yet have buy-in even from the majority of economies that are supposedly the primary beneficiaries of it. WBW3WW 4: more structure As just alluded to on oil, we have another issue: which currency will dominate BW3 trading? It’s one thing to say, “commodity currencies.” It’s another to explain how the BW3 would function if BRL, ARS, AUD, RUB, IRR, etc., were all commodity pricing currencies simultaneously. Who would clear this? At what exchange rate? In what system? Until that is resolved, the USD needs to remain the currency commodities are priced in, even if we see some offsetting BW3 transactions in local FX. Indeed, the proto-BW3 is attempting to keep the current global architecture while trying to cut some USD out of some trades, or to insert another currency where they were previously absent. To give three key examples: Saudi-China CNY oil sales: Saudi Arabia may export some oil to China and be paid in CNY for the first time. It exported $56bn of energy to it in 2019 – but that is a fraction of the $2.6 trillion traded global oil market. Because the Saudis’ own currency is pegged to USD, it would open itself up to FX volatility using CNY. As such, Saudi would price oil in USD and allow (some) payment in CNY; then the Saudis would sell the CNY back for USD. There are limits to what Saudi Arabia would sell in CNY, however, to avoid accumulating CNY of no use to them unless everyone else makes the same shift. Russia-India INR trade: Floated trade between Russia and India to avoid USD will also be priced in USD and transacted in INR. A bank account will be opened in India for Russia, and as Russian commodities (and weapons) arrive in India, INR will be credited to it: as Russia buys goods from India, the account will be debited. This is de facto bilateral barter, technically in INR, and leaves Russia with either the need to buy more than it needs from India, or to accumulate INR claims it cannot usefully transfer elsewhere. Europe-Russia RUB trade: Russia demanded to be paid in RUB for its gas, and perhaps all commodities, and Europe refused to do so. Yet a face-saving solution was found. Europe still pays for Russian gas in EUR or USD, but Russia insists on Gazprombank selling them for RUB to a Russian entity before both are then remitted back to Russia. Meanwhile, Europe appears intent on - slowly - decoupling from Russian energy completely. It should be clear that a BW3 anchor FX/clearing currency would have to be found. Even though China is huge commodity importer, not exporter, which runs counter to the whole BW3 concept, CNY is the obvious candidate as a BW3 anchor: only China has the economic scale. As already shown, CNY does not meet the criteria to be a global reserve currency because of its closed capital account and trade surpluses. However, for the BW3 commodity producers that China runs a deficit with, CNY may be able to play a larger role. (Figure 8.) Yet because CNY is still not going to be a true global alternative to USD for structural reasons, there are still rigid limits on how much bilateral China-BW3 trade we might actually see shift, as we shall now show. WBW3WW 5: trade data The numbers don’t add up for BW3 and CNY – at least not as a global game-changer. Total global exports and imports were $38trn in 2019 (Figure 10) to remove Covid/post-Covid distortions. The US accounted for $4.2trn; Canada, the UK, Australia, and Japan --all 5-Eyes geopolitical allies, or under the US defence umbrella-- $4.0trn; the Eurozone $5.2trn internally and another $4.0trn externally; China $4.6trn; and the rest of the world $16.2trn, most of it in USD. (NB the data are only available in USD!) In summary, China accounted for 12% of global trade vs. just 2.6% of central bank reserves at end of 2021 (Figure 11). On the surface, that appears a very bullish argument for the currency, BW3 or not – and BW3 argues it will rise. However, we need to dive into that $4.6trn/12% data to show why CNY is not doing better, and likely won’t do much better even under a proposed BW3. (Figure 12 shows China’s trade breakdown by region and separates Russia from the continent of Europe for obvious reasons.) First, China’s trade with Hong Kong ($561bn) is counted as external. We colour it red to show it is part of the national economy.  China could switch that to CNY but would undermine the role of Hong Kong and the HKD’s USD peg. Then we have Russia ($111bn); the Middle East ($263bn); Africa ($208bn); Asia excluding Japan, India, and South Korea ($728bn); and Latin America ($315bn) adding a further total of $1.6trn. All are shown in shades of orange to indicate they are open to doing trade in CNY. However, more than half of total trade ex. Hong Kong is with North America, Europe, Oceania, or parts of Asia that for geopolitical reasons will not trade in CNY. Moreover, China’s trade patterns (Figure 13) show how much it relies on surpluses with North America and Europe: the risk is that the more China backs BW3, the less the West trades with it, undermining its total trade surplus. In short, China’s maximum CNY global trade share is 4.3% vs. its current 2.6% share of CNY reserves globally. The primary targets for a major USD > CNY switch are in Asia ex. Japan , India, and South Korea (Figure 13). However, ‘orange’ countries might only shift some trade to CNY, not all of it: the trade logic says that will be the case. China imported $211bn of goods from Asia* in 2019, half primary goods/resources, where we presume it could be the BW3 anchor, half manufactures (Figure 14). It exported $517bn of low, medium, and high-tech items as part of electronics supply chains. This left a large trade surplus for China. If bilateral trade was all in CNY, Asia* would need Chinese FDI or loans to cover its trade deficit, with no means of net earning CNY. Moreover, many of the electronics goods it imported from China are re-exported to Western markets, earning USD. As such, the maximum Asian* countries would want to shift to CNY would equal their China exports, as an offset to their imports from China (the red area in Figure 14). So, the total shift in trade is not imports and exports ($728bn), but Asia’s* exports to China ($211bn) doubled, which is $422bn. Yet the number is likely even lower given the complexity of managing balanced CNY trade in so many categories of products. We could perhaps see the total of Asia’s commodity exports to China shift to CNY, so only $120bn. As such, total CNY trade might only be $240bn from a total of $728bn. And presumably those commodities would still be priced in USD – at least until the Middle East, from which Asia* buys energy, changes its currency peg. Similarly, China’s trade with the Middle East saw it import $146bn of mainly primary goods/resources, while exporting $116bn of a broad range of goods (Figure 16). China obviously wants to buy all its commodities in CNY. However, as already noted, the Middle East, with currencies mainly pegged to USD, would only consider switching trade to CNY to the total of their import bill from China, which is less than that total. In short, $116bn of Middle East commodity sales could shift to CNY and be doubled with $116bn of CNY flowing back in the other direction for consumer goods. That is the maximum CNY shift unless China sells a lot more to the region, which would arguably need to be military equipment. The geopolitical risks there should be clear! If oil and gas are still priced in USD, this would be de facto barter or countertrade avoiding USD more than real trade in CNY. Looking at Latin America (Figure 17), the region exported $149bn of commodities to China, and China sold it $151bn of goods of all kinds. Here we see a genuine argument for more CNY trade compared to the total bilateral trade being done. The picture is similar for Africa (Figure 18), where total exports to China were $95bn, of which $85bn were commodities, while China sold $113bn of goods to it. We should also add Russia (Figure 19), where Chinese exported $53bn and imported $57bn, with Russia running a slight trade surplus. For obvious geopolitical reasons, Russia is rapidly embracing CNY – but major Chinese firms from SOEs to Huawei are still wary of US and EU sanctions so far. Using this methodological approach for each region/economy China trades with, we can summarise the total global CNY shift we expect to see (Figure 20). The total theoretical CNY shift is if all trade moves to it under BW3. However, only some countries would and not all countries will do all trade in it: grey areas indicate where they will not. The major CNY shift (in light orange) is if all potential pro-BW3 countries maximize their CNY trade at the level of their total imports or exports, whichever is lower. The likely CNY shift assumes a lower move to CNY with an assumed coefficient driven by geopolitics. In Russia’s case we assume it is 0.8 (i.e., 80% of maximum shifts to CNY). For the Middle East, we assume 0.25 because of USD pegs; for Africa, 0.30 given geopolitical competition for its commodity exports from Europe, Japan, the US, and India; and for Asia* and Latin America 0.25 because of economic competition and/or ties to Japan or the US. The results are hardly a paradigmatic shift away from USD: The major CNY trade shift is worth $1,254bn, equal to 3.3% of global trade vs. a current CNY global reserve equal to 2.6% of the global total. As such, CNY holdings would rise by around a third in Africa, Latin America, the Middle East, and Russia – but nowhere else. (Figure 21.) The likely CNY trade shift is worth $381bn, equal to 1% of global trade. That is lower than the current holdings of CNY reserves: while some economies would add more, Western economies may hold less. (Figure 21.) In terms of FX trading, the major shift is only worth $4.8bn per working day, a drop in the ocean for the $6.6trn global FX markets, and much of that would be offset trading, not selling USD for CNY. In the more likely case, it is only $1.5bn a day, which would hardly be noticed. In short, BW3 is not looking like a global alternative to USD – just a cluster of Chinese hub-and-spokes offset/barter trades trying to avoid USD as middleman. WBW3WW 6: geoeconomics BW3’s prospects would be boosted if CNY was adopted by third parties globally: yet we have already explained why this is structurally very hard to achieve. Two countries that both run trade surpluses with China, e.g., Brazil and Russia, could decide to use CNY to settle some bilateral trade. However, given CNY would remain structurally locked out of the USD’s broader global role, this could arguably best occur within the specific industries that earn CNY: how much intra-commodity industry Brazil–Russia trade do we see? Not much at all. This is economic geography at work – and against BW3. Global trade-flows mean even if more commodity producers were on board with BW3 it would count for little because BW3 does not replicate the structure of commodity producers, goods manufacturers, and final consumer markets - which are mainly in the West. Commodity producers can try to force the West to take their currency, like Russia, via economic coercion. Yet countries running large trade surpluses don’t allow others to earn that currency to pay in it! Moreover, the West can walk away – as it is pledging to do from Russian energy. Unless every commodity producer backs BW3, there are alternatives - and/or technological innovation to reduce commodity intensity. And, to reiterate, if all key commodity producers walked away from the West, they would lose those markets for their commodities. The only way BW3 could avoid this problem would be if the global economy fragments into multiple value chains. The West still has key resources, technology, allies, a strong military, and could even onshore production if needed: could BW3 commodity producers (and China as importer) replicate or sustain value chains without Western technology and Western end consumers? Looking back, some BW3 countries tried that during the last Cold War – and import substitution did not work well for them (Figure 22). Moreover, look at the terrible demography in Russia and China, and their structural economic problems. Could either afford to walk away into a more isolated, combative realpolitik BW3? It seems highly unlikely Russian autarchy work this time given repeated failures over the course of history. How long until it can replace its foreign-built capital stock, foreign-designed cars, trucks, and planes, or high-tech goods? China could fill that BW3 technology gap: yet if so, it would lose Western markets. We would see geopolitical fragmentation – not horizontally, as BW3 commodity producers replace the West, but with parallel value chains from commodity producers to China and the West. Yet look back at Figure 13 and imagine what the loss of a net $430bn in EUR and USD net trade inflows would do for China’s economic and FX stability. That is more than China can hope to offset with lower use of USD under BW3. And what would decoupling mean for its commodity demand, which is where it is supposed to be the BW3 anchor? And let’s not forget China already has economic problems that call into question how long it will remain a giant commodity consumer (i.e., iron ore). Mapping out the problem To make these economic-geography points in another way, we created 3-D BW3 trade maps (Figures 23, 24) that show intra-BW3 trade by region, excluding India, Japan, and South Korea and China; and with China and the US. The conclusion should be immediately obvious: intra-BW3 trade excluding China is only a fraction of that between each of those regions and China,... or with North America – which can be seen is still a hugely important trade partner for most of them. In short, CNY will not be adopted by third parties either within BW3 or outside it. WBW3WW: conclusion Alongside dramatic world events ‘Bretton Woods 3’ has an appealing market narrative. Indeed, we agree with a lot of its core arguments, depressing as they are. However, it is not new. It is old. And in not looking back enough, it fails to look forward sufficiently. To argue that we are going to see shifts to Cold War and global Great Power struggles, and a world in which commodities, logistics, and the military all play key roles alongside finance and currency, and with a geopolitical need to run large trade surpluses, is to argue for an ancient economic philosophy: mercantilism. Modern economists may have forgotten the true meaning of that term, but it reigned as long as commodity currencies did – and it implies a highly realpolitik global environment. To be fair, BW3 implies the same without naming it directly. Yet is that backdrop negative for USD and positive for BW3? No. A mercantilist realpolitik environment is one in which the requisite set of resources and diverse sources of power, after some policy shifts(!), still rest more with the US and its allies and their military, soft power, and financial power, than with a cluster of commodity-producing states (and one commodity importer). That is especially true if that cluster want to create a parallel economic and financial structure from disparate net exporter polities, who do not trade horizontally together to any great degree, and while also still exporting to the rival West! As such, BW3 will not work, and USD will retain its leading global role – albeit perhaps with more sticks and fewer carrots. If we were to see fewer USD circulating internationally via trade, servicing Eurodollar debt will just get harder – and that will keep a structural bid behind USD. By contrast, borrowing in CNY will still be unattractive for almost every economy given China’s persistent trade surpluses and capital controls. As such, on BW3 all we will see at best, is a marginal increase in the ‘offsetting’ use of CNY ahead – and more rapid global decoupling, likely to its ultimate detriment. Tyler Durden Wed, 04/13/2022 - 19:00.....»»

Category: dealsSource: nytApr 13th, 2022

The 9 best family movies on Netflix, from "Shrek" to "Paddington"

Netflix has a lot of family-friendly movies. We rounded up some of our favorites, including originals like "The Mitchells vs. the Machines." Prices are accurate at the time of publication.SonyWhen you buy through our links, Insider may earn an affiliate commission. Learn more. Netflix is home to many great family movies, including some classics and Netflix originals.  Some of the best family films streaming right now include "Paddington" and "Shrek." Netflix plans range from $10 to $20 a month depending on what video quality you choose. Netflix Monthly Subscription$9.99 FROM NETFLIXNetflix has a large selection of family-friendly movies, including many of Dreamworks and Imagination Animation's most popular titles. Whether you're looking for something animated or live action, fantasy or comedy, Netflix has a lot to offer for parents and kids to enjoy together. If you haven't signed up yet, Netflix starts at $10 a month for standard definition streaming. If you want high definition (HD) quality, you need to step up to the Standard plan for $15.49 a month. Subscribers who want 4K streaming with high dynamic range (HDR) can opt for the Premium plan for $20 a month.To help you find a worthy pick for your next family movie night, the Insider Reviews team rounded up some of our favorite family movies on Netflix. All of our picks are rated fresh on review-aggregator Rotten Tomatoes. Check out our picks for the 9 best family movies on Netflix.'Paddington' (2014)StudioCanal"Paddington" is one of my favorite movies of all time. The film mixes live action and computer animation to tell the story of Paddington Bear, who emigrated from Peru to London and is reluctantly taken in by the Brown family.Paddington's story teaches viewers that the meaning of family can evolve over time to include people you choose in addition to the family you're born with. — Angela Tricarico, Streaming Editorial Fellow'The Mitchells vs. the Machines' (2021)NetflixThis 3D animated gem comes from the producers behind modern classics like "Cloudy with a Chance of Meatballs" and "Spider-Man: Into the Spider-Verse." The film immediately had me invested as a parent by focusing on the Mitchell family's relatable dynamic as they survive an AI machine uprising.The first 10 minutes will tug on any parents' heartstrings in the same way Pixar's "Up" managed to a decade ago, and the main character Katie Mitchell is infinitely identifiable in all of us. — Joe Osborne, Senior Tech Editor'Cloudy With a Chance of Meatballs' (2009)Sony"Cloudy with a Chance of Meatballs" ticks all the boxes for an exciting and funny watch for kids and parents alike. The movie expands on the concept introduced in the 1978 children's book of the same name with a fun protagonist that you end up rooting for.With a combination of vibrant animation, silly characters (like a talking monkey), and witty humor, viewers of any age will have a chuckle. — Sarah Saril, Tech Deals and Streaming Reporter'Enola Holmes' (2020)"Enola Holmes premieres on Netflix on September 23.NetflixThis Netflix original movie is based on a series of books about Sherlock and Mycroft Holmes' lesser known 14-year-old sister, Enola. Millie Bobby Brown stars as the title character, with an impressive supporting cast that includes Henry Cavill, Sam Claflin, and Helena Bonham Carter. When her mother goes missing, Enola must prove herself to be just as great a detective as her famous older brother. I love Brown in this role; it's a change of pace from what she's best known for (Eleven in "Stranger Things"), but she carries the film effortlessly. Enola is a great role model for young girls and budding detectives. — Angela Tricarico, Streaming Editorial Fellow'Shrek' (2002)DreamWork AnimationsAfter 20 years, "Shrek" has solidified a place in kids' movie history thanks to its meme-worthy visual gags and its playful satire of classic fairy tales. Mike Myers, Eddie Murphy, and Cameron Díaz star in this irreverent family comedy that spawned a whole franchise of sequels and helped Dreamworks become one of the most successful kids animation studios in Hollywood. — Kevin Webb, Gaming and Streaming Reporter'Shrek 2' (2004)"Shrek 2."DreamworksIt's pretty rare that a sequel can stand up to its predecessor, but in the case of "Shrek 2," this one does not disappoint. All of our favorite characters and performers are back, plus some new big names like Antonio Banderas, Julie Andrews, and John Cleese.The film begins after Shrek and Fiona's "happily ever after" from the first movie, leading to a hilarious story about the married life of royal ogres — in-laws included. — Sarah Saril, Tech Deals and Streaming Reporter'Stardust' (2007)StardustSet in a town that borders the real world and a secret magical one, "Stardust" follows Christian (Charlie Cox), who enters the magical world to collect a highly sought after fallen star. I found myself fully immersed in the film's fantasy kingdom of Stormhold. The movie is easy to follow and a really fun adventure film with hints of comedy, romance, and of course, magic. — Angela Tricarico, Streaming Editorial Fellow'Invader Zim: Enter the Florpus' (2019)NetflixIf you're familiar with the "Invader Zim" TV show of the early 2000s, "Enter the Florpus" is the nostalgia trip you've been waiting for. The Netflix movie premiered in 2019 — over 10 years after the series' conclusion, and our original, bombastic cast of characters is back for a self-contained and surprisingly heartwarming adventure.Even if you've never seen the original show, "Enter the Florpus" still makes for a fun watch with the family. - Sarah Saril, Tech Deals and Streaming Reporter'How to Train Your Dragon' (2010)DreamWorks AnimationThis one is a movie for all ages — even adults can get a kick out of it. On the surface, "How to Train Your Dragon" is just another underdog story, with all of the same elements you'd expect: a strained father-son relationship, a crush on a popular girl, and conflicts with a snarky bully. When you watch it though, the movie becomes so much more.In the end, it delivers the message that fighting isn't the only answer, while still offering a ton of fun with dragons, vikings, and wild action scenes.  — Sarah Saril, Tech Deals and Streaming ReporterRead the original article on Business Insider.....»»

Category: topSource: businessinsiderApr 8th, 2022

Apple"s (AAPL) Apple TV+ Launches New Premium Docuseries

Apple TV+ (AAPL) launches new documentary series with the latest paleontology learnings and state-of-the-art technology to create enhanced viewing experience for customers. Apple AAPL recently announced the launch of a new premium documentary series called Prehistoric Planet. The announcement follows days after the company created history by winning its first Oscar for the movie CODA.Apple TV+’s ambitions to roll out premium original content continue with the launch of its new epic natural history event series. The documentary will feature an original score by multiple Academy Award winner Hans Zimmer and will be narrated by the legendary Sir David Attenborough.The documentary, which will be featured as a week-long event from May 23-27, is produced by BBC studios with the support of Moving Picture Company to create photorealistic visual effects. It is worth mentioning that the Moving Picture Company is responsible for visual effects in movies like The Jungle Book and The Lion King.The docuseries intends to create the most surreal experience for viewers. Award-winning wildlife filmmaking, the latest paleontology learnings, and state-of-the-art technology are being utilized to transport viewers 66 million years to a world ago where dinosaurs roamed.Apple Inc. Price and Consensus Apple Inc. price-consensus-chart | Apple Inc. QuoteApple Winning Market Share With Ambitious ContentApple’s recent Academy Award win over primary streaming competitor Netflix’s NFLX The Power of Dog has boosted Apple TV+’s position in the streaming industry as a serious competitor.Since the launch of Apple TV+ two years ago, several Apple original series and films have earned more than 240 awards and 950 nominations, including the acclaimed SAG Awards, Primetime Emmy Awards and Critics Choice Awards. These accolades are bound to catch viewers’ attention and win market share from other streaming giants like Netflix and Disney DIS.However, Netflix has been spending aggressively to build its original content portfolio and maintain its leading position in the streaming industry.Disney has an impressive lineup of big-budget movies slated to be released over the next 12 months, a number of which will stream on Disney+ simultaneously with their theatrical releases.Zacks Rank and Another Stock to ConsiderApple currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.In the year-to-date period, the company’s shares have fallen 1.8% compared with the Zacks Computer-Mini Computers industry’s and the Zacks Computer and Technology sector’s decline of 1.9% and 10.7%, respectively.Here is another top-ranked stock worth considering in the broader Computer and Technology Sector.Advanced Micro Devices AMD currently sports a Zacks Rank #1.In the year-to-date period, AMD’s shares have fallen 24.8% compared with the Zacks Electronics - Semiconductors’ decline of 14.7%. Just Released: Zacks Top 10 Stocks for 2022 In addition to the investment ideas discussed above, would you like to know about our 10 top buy-and-hold tickers for the entirety of 2022? Last year's 2021 Zacks Top 10 Stocks portfolio returned gains as high as +147.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don’t miss your chance to get in on these long-term buysAccess Zacks Top 10 Stocks for 2022 today >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Apple Inc. (AAPL): Free Stock Analysis Report Advanced Micro Devices, Inc. (AMD): Free Stock Analysis Report Netflix, Inc. (NFLX): Free Stock Analysis Report The Walt Disney Company (DIS): Free Stock Analysis Report To read this article on click here. Zacks Investment Research.....»»

Category: topSource: zacksApr 4th, 2022

Sunday Collum: 2021 Year In Review, Part 3 - From "Insurrection" To Authoritarianism

Sunday Collum: 2021 Year In Review, Part 3 - From 'Insurrection' To Authoritarianism Authored by David B. Collum, Betty R. Miller Professor of Chemistry and Chemical Biology - Cornell University (Email:, Twitter: @DavidBCollum), I have a foreboding of an America in my children’s or grandchildren’s time when the United States is a service and information economy; when nearly all the manufacturing industries have slipped away to other countries; when awesome technological powers are in the hands of a very few, and no one representing the public interest can even grasp the issues; when the people have lost the ability to set their own agendas or knowledgeably question those in authority; when, clutching our crystals and nervously consulting our horoscopes, our critical faculties in decline, unable to distinguish between what feels good and what’s true, we slide, almost without noticing, back into superstition and darkness. The dumbing down of America is most evident in the slow decay of substantive content in the enormously influential media, the 30 second sound bites (now down to 10 seconds or less), lowest common denominator programming, credulous presentations on pseudoscience and superstition, but especially a kind of celebration of ignorance. ~  Carl Sagan, 1995, apparently having invented a time machine Every year, David Collum writes a detailed “Year in Review” synopsis full of keen perspective and plenty of wit. This year’s is no exception. Read Part 1 - Crisis Of Authority & The Age Of Narratives here... Read Part 2 - Heart Of Darkness & The Rise Of Centralized Healthcare here... So, here we are at the third and final part of the 2021 Year in Review and it’s no longer 2021. Sorry about that pfuck-up. Think of it as not in 2021 but from 2021. You may have noticed that the first 200 pages (parts 1 and 2) were laced with a recurring catchphrase, “WTF is happening?” It was a literary device for noting that the events ceased to make sense within a conventional worldview, suggesting it is time to torch the old model and start anew. Our response to a disease that was killing a very small slice of the population was to sequester and vaccinate the entire population with an experimental drug of real but unquantified fatality rate. The apparent scientific illiteracy was not some mass psychosis. Y’all just got suckered by America’s Most Trusted Psychopathic Mass Murderer assisted by an epic media blitz sponsored by the pharmaceutical industry that had a distinct authoritarian quality. Unthinking respect for authority is the greatest enemy of truth. ~ Albert Einstein During the brief period after uploading part 2 while grinding on this last portion, the Supreme Court took on the vaccine mandate issue, ruling that the only people forfeiting control of their own healthcare are the healthcare workersref 2 The court also illustrated their profound ignorance of the pandemic and what they were even charged to assess—the Constitutionality of mandates, not the efficacy.ref 3 The CEO of a major insurer reported a 40% spike in fatalities within the 18–65 age bracket that was not from Covid.ref 4 He said 10% would be a 3-sigma, once-every-200-year event: 40% is unheard of. Although he refrained from identifying a cause—deaths of despair, neglected healthcare, or a toxic vaccine—he knows precisely what did them in. They have been studying this stuff for centuries. I suspect his real message was that the insurance industry is about to contribute to inflation with rising premiums. Meanwhile, the pathological liars running the covid grift decided after two years the masks you’ve been wearing served no medical purpose and that the vaccines don’t work either. Wait: who said the masks and vaccines don’t work? We have known for many months that COVID-19 is airborne and therefore, a simple cloth mask is not going to cut it…Cloth masks are little more than facial decorations. ~ Leana Wen, MD, CNN medical expert with no admitted ties to the CCPref 5 Two doses of the vaccine offers very limited protection, if any. Three doses with a booster offer reasonable protection against hospitalization and deaths. Less protection against infection. ~ Albert Bourla, Pfizer CEOref 6 Here is my most heartfelt response to them: You psychopathic lying sacks of shit. You had us wear rags across our faces and put rags across the kids’ faces when clinical studies that could be read by people with half your IQs showed they were worthless. Suicide rates and other deaths of despair soared while you petty tyrants played your little games and generated billions of dollars of profits while destroying the middle class. You have maimed or killed an unknown number of gullible victims with your lockdowns, vaccines, remdesivir, and oppression of Ivermectin. You jammed a vaccine that bypassed animal trials into the fetuses of pregnant women, assuring them it was safe. If we spoke up, we got muzzled. If we refused the vaccine, we got fired. You should all hang from your necks until dead. I will piss on your graves. I feel better already. Very refreshing. Meanwhile, many of my friends and colleagues look at the same data and say, “Oh. I guess I better get the booster and a KN95 mask.” You have got to unfuck yourselves. You’ve been duped. It will get worse. The tactics used to oppress us would have made Stalin smirk. Australia was a beta test for what is to come in the rest of the west if we don’t wake up soon. They are gonna keep coming for one simple reason: we accepted it. We got bent over and squealed like pigs. What normalization does is transform the morally extraordinary into the ordinary. It makes us able to tolerate what was once intolerable by making it seem as if this is the way things have always been. ~ Jason Stanley, How Fascism Works A person is considered ‘ordinary’ or ‘normal’ by the community simply because he accepts most of its social standards and behavioral patterns; which means, in fact, that he is susceptible to suggestion and has been persuaded to go with the majority on most ordinary or extraordinary occasions. ~ William Sargant, in Battle of the Mind Meanwhile, the financial world became even more dominated by central bankers who haven’t the slightest understanding of free-market capitalism. These twits or criminals—maybe both—have blown the most colossal bubble in history if you account for both price and breadth across the spectrum of asset classes. For the layperson, that means they have set us up for a colossal failure. Go back and re-read Valuations if you cannot picture the epic financial carnage lying dead ahead. The gap between the Fed funds rate and headline inflation has never been this large. These pinheads believe that if the markets do not coincide with their world views, the markets must be wrong. I am not an economist, but it appears that none of them are either. The notion that a dozen nitwits should set the most important price of them all—the price of capital—rather than letting the markets set it through price discovery is financial authoritarianism or what some call State Capitalism. I am angry in case it doesn’t show. Meanwhile, in 2020–21 the Fed contributed to destroying upwards of a half-million mom ’n’ pop businesses—they gutted the middle class—while giving BlackRock credit at 0.15% interest rates to buy up all their houses. Here is my advice to those day trading criminals: look both ways as you enter crosswalks. What I believe the response of society to a severe downturn given the current political climate will be epic. Big downturns come after euphorias. We have never entered a downturn with society at large this grumpy. We are in the early stages of The Fourth Turning.ref 7 The deterioration of every government begins with the decay of the principles on which it was founded. ~ Charles-Louis De Secondat When a State has mortgaged all of its future revenues the State, by necessity, lapses into tranquility, langor, and impotence. ~ David Hume, 1752 So, WTF is going on here? In this final part, I address geopolitics. It begins with a relatively benign analysis of Biden’s first year in office, culminating with what I think Afghanistan is really about. The second section addresses my view of what may prove to be the most important day in US History—January 6, 2021. Although it is my best shot—Dave’s Narrative—I will not attempt to nor will I inadvertently spread the love to both sides of the political spectrum. It is a right-wing view that most right-wing politicians and pundits are too cowardly to state in polite company. The final section addresses the Rise of Global Authoritarianism. For a topic covered by thousands of treatises to call my knowledge skeletal is a reach. I have merely created an intellectual foundation—a chalk outline—to ponder why authoritarianism is here and what could stop it. (Plot spoiler: I do not believe it can be stopped.) They know where we are, they know our names, they know from our iPhones if we’re on our way to the grocery store or not. But they haven’t acted on that to put people in camps yet. They could do it. We could be East Germany in weeks, in a month. Huge concentration camps and so forth. ~ Daniel Ellsberg (@DanielEllsberg), author of The Pentagon Papers and Secrets Before moving on, let me give a plug for a book.ref 8 I have not even finished it yet, but it will change your worldview. Look at those ratings! I can guarantee none of those readers enjoyed it. Kennedy will curdle your bone marrow describing 35 years of atrocities commited by America’s Most Trusted Madman. It is emblematic of a much larger problem. Evil is powerless if good men are unafraid – Americans don’t realize what they have to lose. ~ Ronald Reagan The whole aim of practical politics is to keep the populace alarmed (and hence clamorous to be led to safety) by menacing it with an endless series of hobgoblins, all of them imaginary. ~ H. L. Mencken Biden – Freshman Year Scorecard Let’s go, Brandon! ~ Cheers across America Most presidents begin their reign with a calling. Reagan raised our national self-esteem after a period of economic and political malaise. Bush Sr. took on the Gulf War, for better or worse. Clinton oversaw the economic boom and bank deregulation, again for better or worse. Bush Jr. was handed 9/11 and, in my opinion, boned it badly. Obama had to wrestle with the Great Financial Crisis. Trump was charged with disturbing the peace—drain the swamp if you will. Biden undeniably needed to begin healing the social discord that, regardless of its source, left the country wounded and divided. Maybe that was not Biden’s calling, but I wanted to see him become the president of all the people. This is not revisionist history of my failing memory: Biden’s the last of the Old Guard, which is probably why he was slipped into the office by the DNC old guard. I am guessing there will be no Supreme Court stacking; that was just rhetoric (I hope). There will be wars just like every president (except Trump, who brought troops home.) Congress is more balanced again and, at the time of this writing, the Senate is still in Republican hands. Hopefully, the gridlock will usher in some garden-variety dysfunction. I have subtle concerns about a Harris presidency. Admittedly, my opinion is based on precious few facts, but Harris displays a concerning shallowness of character, a lack of a moral compass, and the potential to slide to the left of Bernie. (I sometimes reflect on what it must have been like raising the teenaged Kamala.) I am trying to reserve judgment because first impressions scavenged from the digital world are sketchy if not worthless. ~ 2020 Year in Review By this description, Biden tanked his GPA. He ushered in a Crusade to erase the Trump era and its supporters. The weaponizing of social media and censorship against one’s opponents was probably unavoidable, but the downside will be revealed when the wind changes. Team Biden took banishing of political opponents on social media to new levels by, as noted by Jen Psaki, flagging “problematic posts” and the “spread of disinformation” for censorship. NY Timeslapdog Kevin Roose called for a “reality Czar,” not noticing the Russian metaphor problem. The War on Domestic Terror may prove to be a turning point in American history, one that risks extinguishing the flame of the Great American Experiment. Significant erosions of Constitutionally granted civil liberties discussed throughout the rest of this document may not have been Biden’s fault, but they occurred on his watch. If you see an injustice and remain silent, you own it. I can’t remain silent. Biden is the epitome of the empty, amoral creature produced by our system of legalized bribery. His long political career in Congress was defined by representing the interests of big business, especially the credit card companies based in Delaware. He was nicknamed Senator Credit Card. He has always glibly told the public what it wants to hear and then sold them out. ~ Chris Hedges, right-wing hatchet man Team Biden. Books have been written about Trump’s fumbles in the first months (or four years) of his presidency. See Josh Rogin’s Chaos Under Heaven in Books or Michael Lewis’ less balanced The Fifth Risk reviewed in last year’s YIR. The Cracker Jack team assembled for Joe reveals a glob of feisty alt-left activists and omnipresent neocons. According to Rickards, two dozen players on Biden’s roster were recruited from the consulting firm WestExec Advisors (including Psaki and Blinken.)ref 1 That’s power and groupthink. David Axelrod: You must ask yourself, ‘Why are we allowing him to roll around in the hallways doing impromptu interviews?’ Jen Psaki: That is not something we recommend. In fact, a lot of times we say ‘don’t take questions.’ Young black entrepreneurs are just as capable of succeeding given the chance as white entrepreneurs are, but they don’t have lawyers; they don’t have accountants. ~ Joe Biden Joe Biden, President – Joe is the Big Guy. In an odd sense, he is immunized from criticism because he is visibly losing his marbles. His cognitive decline is on full display; this 52 seconds of gibberish about inflation is emblematic.ref 2 He’s 80 years old, for Cripes sake. I read a book this year entitled, When the Air Hits Your Brain, which derives from a neurosurgical aphorism that finishes with “you ain’t never the same.” Wanna guess who had two brain aneurysms (one rupturing) years ago leading to a miraculous recovery?ref 3 You’re the most famous African-American baseball player. ~ Joe Biden to the Pope, context unknown (possibly even a deep fake)ref 4 I am neither reveling in Joe’s problems nor do I believe he is calling the shots. Claims that the puppet master is Harris are, no offense, on the low side of clueless. Obama seems like a better guess but Barrack was a front man too. Having an impaired leader of a superpower, however, is disquieting and potentially destabilizing, especially with Taiwan in play. Biden’s energy policy that clamped down on fossil fuel production only to ask OPEC to open the spigots is one for the ages. The covid policies bridging both administrations were catastrophic, but throwing workers out of jobs into the teeth of unprecedented labor shortages makes zero sense. The nouveau inflation—Bidenflation—may stick to him like it stuck to Jimmy Carter, but that is unfair to both presidents. Look to the Fed in both cases for blame. Troubles at the southern border and the Afghanistan pullout are a couple of serious logs for a raging inferno that represents Biden’s first year in office. As discussed in a later section, demonizing “white supremacists”—not just political opponents but opponents labeled by their race—will not be viewed well by historians unless history is at a serious fork and Joe is ultimately protrayed as the founder of some new Fatherland. Kamala Harris, Vice President – Whenever situations heat up, Harris is off like a prom dress. During the crisis at the border that she was charged with overseeing, she took off to Europe, cackling about never even visiting the border. Kamala endorsed and claimed credit for the Kabul evacuation.ref 5,6 Realizing she had pulled yet another boner she pulled out before they renamed it Kamalabad. (Hey: At least I had the decency to pass on the Kamalatoe joke.) In a moment of surreal comedy, Harris hosted a public chat with Bill Clinton on “empowering women.”ref 7 She can even serve up semi-reasonable ideas with dollops of cringe. If the Democrats nominate her in 2024, may God have mercy on their souls—she is unelectable—or maybe on our souls—I could be wrong. Jen Psaki, Press Secretary – The role of any press secretary is to calm the press down with nuggets of insight—to feed the birds. When that fails, lie your ass off, all with a cold, calculating sociopathy. I would say she did the best job imaginable given the hand she was dealt. Disagree? I’ll just have to circle back with you on that. Ron Klain, Whitehouse Chief of Staff – This guy might be the rainmaker, but I haven’t quite figured him out. He has the durability of Andrei Gromyko, maintaining a central role through three democratic administrations. Keep an eye on him. Janet Yellen, Secretary of the Treasury – We have yet to find out Yellen’s role because she has not been pressed into service by a crisis. To resolve the minor “meme stock” bruhaha, which did not call for a resolution, she needed an ethics waiver owing to the soft corruption of her bank-sponsored million-dollar speaking tour. My expectations of her are quite low, and I imagine she will meet them. Antony Blinken, Secretary of State – He has a good resume. Like Psaki, he is forced to play a weak hand. He lacks Psaki’s skills. Jennifer Mulhern Granholm, US Energy Secretary – In a press conference she was asked how many barrels of oil a day the US consumes and said, “I do not have those numbers in front of me.” ‘Nuff said. Get her out of there. Merrick Garland, Attorney General – The press will tear anybody a new one so snippets with bad optics are always dangerous. I would say, however, ordering the FBI to investigate parents who get irate at school boards—even those who seem rather threatening—is over the top. Leave that to the local and state police. His role in the January 6th event and push into domestic terrorism is potentially sinister and moves him onto my shitlist. Saule Omarova, nominee for Comptroller of the Currency – This one blows my circuits. She is what in the vernacular is called “a commie” straight from Kazakhstan with a thesis on Marxism—a devout believer that the State should run the show. She also hails from Cornell Law School. (Yeah. I know. STFU.) Matthew Continetti of the National Review noted she is, “an activist intellectual who is—and I say this in the kindest way possible—a nut.”ref 8 There will be no more private bank deposit accounts and all of the deposit accounts will be held directly at the Fed. ~ Saule Omarova, Cornell Law Professor   We want them to go bankrupt if we want to tackle climate change. ~ Saule Omarova, on oil and gas companies For those who have seen the horror movie The Ring, Cornell tried to exorcise the demon by sending “the VHS tape” to Washington, D.C., but it came back stamped “Return to Sender.” She withdrew. Hey Team Biden: you could want to snatch up MIT’s Venezuelan-derived president who is already on the board of the World Economic Forum and was instrumental in pushing Aaron Swartz to off himself.ref 9 John Kerry, Climate Czar – Don’t we have enough Czars? John is charged with flying around the world in his private jet, setting the stage for a 30-year $150 trillion push to make many bank accounts much My disdain for the climate movement catches Kerry in the splash zone. Pete Buttegieg, Transportation Secretary – I must confess to liking Mayor Pete and would have been happier if he had gotten the crash course in the oval office rather than Joe. The one criticism I would make is that taking two months of paternity leave during the nation’s greatest transportation crisis seemed odd. I think when you are in such an important position you find a way. Get a nanny. Bring the twins to your office. Leave them with your spouse. For Pete’s sake (sorry), stay at your post. For the record, after my youngest son was born my wife had health problems. I used to bring him to work and lecture with him in a Snugly and changed a shitload of diapers. You could have done it too, Pete. Samantha Power, Head of the US Agency for International Development (USAID) – Sam is a garden-variety neocon, having served as ambassador to the UN and on the National Security Council, both under Obama. She was central to the planning behind destabilizing Libya,ref 10 which sure looks like a bad idea unless destabilizing the Middle East is our foreign policy. Please just don’t fuck up too much. Cass Sunstein, Homeland Security employee. This is not really an appointment, per se. Cass is the Harvard-employed husband of neocon Samantha Powers. In his 2008 book, Conspiracy Theories, Cass declared “the existence of both domestic and foreign conspiracy theories” to be our greatest threat, outlining five possible solutions, and I quote, “(1) Government might ban conspiracy theorizing. (2) Government might impose some kind of tax, financial or otherwise, on those who disseminate such theories. (3) Government might engage in counter-speech, marshaling arguments to discredit conspiracy theories. (4) Government might formally hire credible private parties to engage in counter-speech. (5) Government might engage in informal communication with such parties, encouraging them to help.” Guys like Cass who come out of Harvard’s CIA training camps are menaces to society. Marvelous hire, Joe. Victoria Nuland, Undersecretary for Political Affairs – She is famous for her hot mic “Fuck the EU” comment and for engineering the coup in Ukraine—a Wonder Bread neocon. William J. Burns, Head of the CIA – I’ve got nothing on Bill, not even a fingerprint. It would be difficult for me to grade him poorly on a curve with the likes of John Brennan, William Casey, and Alan Dulles. (I once had dinner with a former CIA head John Deutch. What a dick.) Christopher Wray, Head of the FBI – As the FBI increasingly looks like the Praetorian Guard for the power elite (both in and out of public office), Wray has followed in the footsteps of his predecessors like J. Edgar Hoover and James Comie to be both top cop and dubious scoundrel. Wray’s fate might be dictated by the ongoing Durham investigation, but I have not seen any heads roll inside the Beltway since Watergate a half-century ago. Tony Fauci, Director of NIAID – That bipartisan, power-hungry authoritarian—The Most Trusted Madman in America—is a recurring theme. He doesn’t know any science. He is a political hack—a chameleon—who survived 35 years multiple administrations by being able slither out of anybody’s claws and regrow his tail. Rochelle Walensky, Director of the CDC – She got serious attention in part 2. I am horrified by her sociopathy. I think she is evil. Amy Gutmann, Ambassador to Germany – Guttman was given the job after giving the Big Guy more than $900,000 in speaking fees and an honorary degree from UPenn when she was the University’s president. I am sure every ambassador pays market rates for the job.  Cathy Russell, Biden’s Director of Presidential Personnel–She is married to Tom Donlin, Chairman of the gargantuan multinational investment firm, BlackRock. Their daughter made it into the Whitehouse National Security Council. A talented family enjoying the political respect accorded to billionaires. Asmeret Asefaw Berhe, Head of the Office of Science – Despite scientific chops as a climate-change-supporting agronomist, she has no administrative experience and is inexperienced in the scientific programs that she is overseeing. Of course, everything is now about the $150 trillion climate grift, so she’s our girl. Jared Bernstein, Whitehouse Economic Advisor – He is highly educated, with a bachelor’s degree in music, master’s degrees in social work and philosophy, and a Ph.D. in social welfare. His greatest strength may be his complete lack of training in economics. Shalanda Baker, Deputy Director for Energy Justice in the Office of Economic Impact and Diversity at the Department of Energy – Is that a salaried position? ‘Nuff said. General Mark Milley, Chairman of the Joint Chiefs of Staff – Mark transitioned from the Trump administration. It caused a stir when he went more “woke” than Chelsea Manning. We will no longer defeat our enemy but assign them pronouns and include them. This was followed by a scandal outlined in Bob Woodward’s book in which he instructed military leaders in a secret meeting to bypass Trump on important military decisions.ref 11 He then unilaterally told his peer in the Chinese military that he would drop a dime if there was an impending military conflict. He tried to hang it on the Secretary of Defense, but the Secretary spit the bit fast.ref 12 My theory is that the sudden wokeness was to commandeer allies on the far left knowing that scandal was coming. It worked. He looks like he is right out of Dr. Strangelove without the lip gloss and eye shadow. Xavier Becerra, Secretary of Health and Human Services. He refuses to acknowledge the merits of natural Covid-19 immunity. That puts him near the top of my shitlist. Becerra has no medical or scientific training. He’s a lawyer, but at least he is from an underrepresented group. Rachel Levine, Assistant Secretary of Health and Human Services – I know little about her. She might be the most qualified candidate, certainly more so than her boss Becerra. Call me skeptical of a purely merit-based appointment. Hunter Biden. I was going to place Hunter in the bullets and call him Head of the DEA and National Association of the Arts, but I had reservations. There are sad, heartwarming, and troubling roles played by Hunter Biden. His addiction is a highly personal problem that is difficult for the first family to deal with, especially given other tragedies in their lives. Joe Rogan succinctly explained Hunter’s remarkably odd behavior: “he is a crackhead.” They are part and parcel of being dopesick. Leaked emails from the laptop show Dad to be a compassionate and loving father struggling to save his son. Ironically, old footage surfaced of Joe ranting about how we have to deal with crackheads severely no matter whom they know.ref 13 It did not age well. It is clear that Hunter Biden was selling access and influence. It appears that Joe Biden was aware of that effort. That is very serious. If these emails are false, this is a major story. If they are true, this is a major scandal. ~ Jonathan Turley Before you start blubbering, however, recall that Hunter’s laptop revealed that he was playing critical roles in Russian and Chinese dealings for the Biden family. The Kleenex gets tossed and the gloves now come off. Hunter’s business partner stepped forward admitting nefarious deals were made with Joe involved. Joe denied knowing the clown, but a then photo of the two surfaced.ref 14 This year Hunter also began selling his artwork for up to $500,000 a pop behind a “Chinese Wall”—a veil that ensures we cannot find out who bought the art.ref 15,16,17 The money might literally be from behind a Chinese wall. That buys a lot of crack even after the Big Guy’s 10% cut. Figure 1 shows two paintings, one by a Hunter and the other by two elephants. (No joke, elephants have been painting brilliant pictures free-trunk for decades.) Figure 1. Biden art (left) brought $500,000. The elephant painting (shown being painted) brought $39,000. We are a democracy…there are things you can’t do by executive order unless you are a dictator. ~ Joe Biden, several years ago Executive Orders. Before the first week of his presidency was over, Biden had signed 37 of those beauties. Some, such as the order extending rent moratoria, were overtly unconstitutional. Some merely unwound Trump’s orders that had unwound Obama’s orders. This is dodge ball. While Yale was battling a civil rights case for discriminatory admissions practices, the Biden DOJ dismissed it without comment.ref 18 Yale is said to have promptly destroyed the evidence, which shows they have good lawyers. Transgender athletes were reinstated in women’s sports, ensuring that longstanding records will be shattered.ref 19 It got surreal when UPenn’s transgender swimmer was beaten by Yale’s transgender swimmer.ref 19a An executive order giving the IRS direct access to our bank accounts seems both sinister and inevitable…death and taxes as they say.ref 20 There are a lot of Republicans out there giving speeches about how outraged they are about the situation at the border. Not many who are putting forward solutions. ~ Jen Psaki, forgetting about the wall idea Crisis at the Border. The mainstream press covered this one exhaustively. There are parallels here with the North Africans crossing into Europe several years back. It looks intentional, but why? Don’t tell me about building a democratic base. That is too far in the future and too simplistic. It is far easier to control the elections at the server level. Baffling details include the administration’s suggestion that border agents should be empowered to authorize the immigration of “climate migrants.”ref 21 That could boost a few agents salaries. Rumors of US military planes transporting illegals into the US suggests somebody could punk the elite: load up a boat and drop a couple hundred on Martha’s Vineyard. On further thought, rather than offering Vineyardians more gardeners, drop off some Afghans.ref 22Whoever is calling the shots, this is neither about civil rights nor climate change. Attorney General Merrick Garland clarified the immigration challenge: Today marks a step forward in our effort to make the asylum process fairer and more expeditious. This rule will both reduce the caseload in our immigration courts and protect the rights of those fleeing persecution and violence. If you do that, that will set off a mass migration that’s like nothing that we have ever seen in this country because the entire world will then come on through to get their asylum, essentially legalizing illegal immigration, in a very clever way. ~ Attorney General Merrick Garland WTF did Garland just say? Both his meaning and intent are unclear. The immigrants, of course, were all unvaccinated, which would have been OK by me had the administration not gone Third Reich to vaccinate US citizens. The administration also wanted to offer $450,000 to every immigrant family separated from their loved ones: why?ref 23They seemed to walk that third-trimester idea back and then walked it forward again. A half-billion-dollar, no-bid contract to manage the immigrants went to friends of the administration.ref 24 Your tax dollars at work. At least we are back to business as usual. By the way, where is Border Czar Kamala Harris while all this is going on? Making creepy videos.ref 25,26 People who like quotes love meaningless generalizations. ~ Graham Greene Miscellaneous issues surfaced that either went away or are still festering quietly. On the positive side, stacking the Supreme Court—increasing the number of justices to get a left-leaning majority—seems to have been only a political football. Granting Washington DC statehood, while to a plebe like me doesn’t seem nuts, has the trappings of a massive powershift to the left in national elections. Joe invaded the legal process by declaring Chauvin guilty and Kyle Rittenhouse a white supremacist. Would Obama have done this? I don’t think so. Rittenhouse may get his “10% for the Young Guy” in defamation suits against Joe and every media outlet on the planet. Joe checking his watch five times at the funeral of dead marines didn’t play well,ref 27 but if you put a camera on me I wouldn’t make it to lunchtime without serving up Jim Acosta fresh meat. The main drama of Biden’s first year, however, played out in a distant land.   Afghanistan—where empires go to die. ~ Mike Malloy Afghanistan. I’ve been groping for nomenclature — Afghazi, Afghazistan, Benghanistan, Benghazistan, Saigonistan, Clusterfuckistan, and Bidenistan—to describe this odd moment in history. That 20-year skirmish cost an estimated $2.3 trillion.ref 28 The idea that it was only a few thousand troops with no fatalities in the last year or two makes me question my wisdom, but I can’t start revising history. Whether for right or wrong, I was glad we were getting out. The ensuing Crisis in Kabul looked like the graveyard of a presidency—a combination of the Bay of Pigs and the Iran Hostage Crisis that would dog us for years. They are chanting “Death to America”, but they seemed friendly at the same time. ~ CNN reporter wearing a burka looking for a husband Even before the evacuation started we were hearing about huge caches of weapons that would be abandoned.ref 29 In an eat-and-dash that would make an IHOP waiter wince, we bugged out at 2:00 AM without telling anybody.ref 30Jalalabad Joe had assured us repeatedly the 300,000-strong Afghan army would hang tough. They were defeated in time to chow down on some goat stew for dinner. Images of desperate Afghan’s clinging to transport planes brought up images of the Saigon Embassy rooftop. We left service dogs in cages.ref 31 Marines would never do that. Stranded Americans and Afghan collaborators were begging for help to get to the airport and even to get into the airport.ref 32The administration used a drone to strike on some kids and their dads loading water into a truck to change the news cycle briefly.ref 33 The Afghan who is credited with saving Joe Biden and John Kerry in a disastrous excursion to Afghanistan years earlier got left behind pleading for help:ref 34 Hello Mr. President: Save me and my family. Don’t forget me here. Mercenaries like Blackwater’s Erik Prince tried to prevent Americans from taking The Final Exit,ref 35 only to get stonewalled by the Whitehouse. Meanwhile, the top commander and four-star Wokie, Mark Milley, was too mired in scandal.ref 36 Retired generals were calling for the active-duty generals to resign.ref 37 The withdrawal could not be botched worse if you tried. The populace are now facing a winter of profound famine.ref 38 Rural Afghanistan has been rocked by climate change. The past three decades have brought floods and drought that have destroyed crops and left people hungry. And the Taliban — likely without knowing climate change was the cause — has taken advantage of that pain. ~ CBS News, sticking it like a Russian gymnast This vexing story was from the Theater of the Absurd. Starting with the caches of military equipment left behind, I have two simple solutions that a group of teenagers could have concocted: Announce Blow Shit Up Friday (BSUF). Provide the military personnel with some grenade launchers and a few kegs of beer, grill up some goat burgers, and start blowing shit up. That would be a blast. If that is too unprofessional, you gather all armaments and anything of else of value into an open space. Once the wheels go up on the last troop transport, drop a MOAB—Mother of All Bombs.ref 39 Tough luck for those who were trying to hotwire the stuff when the MOAB arrives. It will take a year to get them out…If you use those billions of dollars of weapons behind I promise they’ll be using them against your grandchildren and mine someday. ~ Joe Biden, Presidential Candidate, 2007ref 40 The collapse of the Afghan Army also couldn’t have come as a surprise. The military and CIA certainly knew that those troops wouldn’t withstand a West Side Story-level brawl.ref 41 The soldiers were paid by the US for their service COD, and there was no C left. Shockingly, most of the payroll booty had long-since been snarfed up by the politicians and top military brass from the only swamp in Afghanistan.ref 42 Whocouldanode? Taliban can murder as many people as they want. But if they keep trolling Biden like this they’re gonna get kicked off of social media. ~ Jesse Kelley, noting the Taliban has an active Twitter feed Here is a script playing out in my noggin. The Crisis in Kabul was an arms deal—Fast and Furious 2.0. One of our top diplomats called the Taliban and said, “We are pulling out in a month. We’ll leave the keys in the ignition and pallets of $100 billsref 43 to help pay for upkeep. If you guys let us sneak out unmolested, you can party like it’s 999—an authentic Taliban-themed fraternity party. We will leave you guns, money, nice facilities, and even a few wives. If you fuck this up, however, we will be right back here.” The Whitehouse also lent a legitimizing tone to the regime when speaking about “working with the Taliban” as part of the deal. In return, the State Department called on the Taliban to form an “inclusive and representative government,”ref 44 so there’s that bit of risible nonsense. Neville Chamberlain couldn’t have done any better. The bottom line: 90% of Americans who wanted to leave Afghanistan were able to leave Afghanistan. ~ Jalalabad Joe Biden That might be a great poll number or inflated final exam grade at a college Joe erroneously claimed to attend, but I am not sure “90%” is impressive in this context. The actual evacuation was ineptly executed from the get-go. Mr. Rogers, with the help of his viewing audience of toddlers, could have Kabuled together a better plan based on the simple precept, “pull out the civilians then the military.” Baffling claims the Whitehouse was obstructing evacuations of charter flights containing Americans was not right-wing propaganda: Where are they going to land? A number of these planes have a handful of Americans, but they may have several hundred individuals who do not have proper documentation of identity….we don’t have manifests for them, we don’t know what the security protocols are for them, we don’t know what their documentation is…hard choices you face in government. ~ Jen Psaki, press conference WTF actually happened? When nothing makes sense your model is wrong. Glenn Greenwald got the scent that withdrawal was intentionally mishandled, suggesting this is “fully within the character of the deep-state operatives.”ref 45We also forgot to destroy our sophisticated FBI-derived software and a complete database containing the biometrics of Friends of the USA,ref 46,47,48 enabling the Taliban to find potential detractors for an attitude correction. Think of it as Afghanistan’s high-tech War on Domestic Terror. The stonewalling of help from other countries also makes no sense using a conventional model.ref 49 Biden’s CIA Director met with Taliban leadership covertly—so covertly we all knew about it—to concoct a “deal”, but what kind of deal?ref 50 During the evacuation, we gave the Taliban names of American citizens, green card holders, and Afghan allies supposedly to let them pass through the militant-controlled perimeter of the city’s airport.ref 51 They would never abuse this list, right? A large number of Afghan refugees—possibly as many as 100,000 according to Tucker Carlson—entering the US are consistent with our open border policy along the Mexican border, but what is that all about? Afghans, by the way, are reputed to be always recalcitrant to assimilate in Europe just in case you’re thinking of renting out your basement as an Airbnb.ref 52 What happened in Afghanistan is not incompetence. We are not that incompetent. ~ General George Flynn The goal is to use Afghanistan to wash money out of the tax bases of the US and Europe through Afghanistan and back into the hands of a transnational security elite. The goal is an endless war, not a successful war. ~ Julian Assange, 2011ref y I have no doubt that blood was shed after we left. More than a few US sympathizers surely lost their heads. As to the stranded Americans, why were they still there? China had evacuated their citizens months earlier.ref 53(Hmmm…Chinese citizens were there?) Two dozen students from the Cajon Valley Union School District and 16 parents there for an enriching summer trip were stranded.ref 54 How did they get visas? That field trip will generate a few college essays that will beat any written about dead grandparents, although Kabul State College may be their only option. This is now on-track, Peter, to be the largest airlift in U.S. history. I would not say that is anything but a success. ~ Jen Psaki to Peter Doucy The media can create, steer, or smother narratives at will. I have a question: Where are all the dead Americans—thousands of them—said to be left behind? Horror stories should be surfacing daily, but they’re not. We shit a mudbrick when One Dead Kashoggi (ODK) got fed to the camels in Saudi Arabia. Three thousand fatalities on 9/11 got us into Afghanistan in the first place. We supposedly left behind “thousands of Americans” but without generating a single headline? So much for that Bay of Pigs­–Iran Hostage Crisis analogy. So here are my next questions and I am deadly serious: Did we get duped? Was the whole thing more sham than farce? There is no such thing as a true account of anything. ~ Gore Vidal Here is Dave’s Narrative. We installed the Taliban as the rulers of Afghanistan as the best of many bad options. The winners are the Taliban and China. The two are inking deals for mineral rights as I type. The chaos was intentional. But why accept such a profound humiliation and dashed hopes of future alliances in global hotspots? I think that the Taliban winning the war in Afghanistan, and then the way our exit happened, has absolutely inspired jihadists all over the world. The Taliban is saying, we just didn’t defeat the United States, we defeated NATO. We defeated the world’s greatest military power, ever. I think, not only will the jihadists be inspired, but a lot of them are going to come to Afghanistan to be part of the celebration, to be part of jihadist central. We are more at risk, without a doubt. ~ Michael Morell, former CIA Director under Obama Maybe China has way more than just Hunter’s laptop to blackmail us and is about to take possession of Taiwan soon. While we await the next Kyle Rittenhouse trial to preoccupy ourselves, take a peek at this video. Skip over the election stuff since we all have rock-hard opinions on that and go to minute 55:30. Xi Jinping’s right-hand man, Di Dongsheng, publicly explained the extent Beijing controls US politics:ref 55 There is nothing in the world that money can’t fix, right? If one wad of cash can’t handle it, then I’ll have two wads. (laughter) Of course this is how I do things. In fact, to be a bit blunt, in the past 30 years or past 40 years, we manipulated the core power circle in the United States, right? I mentioned earlier that Wall Street started to have a very strong influence on U.S. domestic and foreign affairs in the 1970s. So we figured out our path and those we could be dependent on. But the problem is that Wall Street’s status has declined after 2008. More importantly, starting in 2016 Wall Street has no influence on Trump. Why? It is awkward. Trump had a soft breach of contract on Wall Street once, so the two sides had conflicts. They tried to help during the Sino-US trade war. As far as I know, friends from the U.S. told me that they tried to help, but they were too weak. But now we see that Biden has come to power. (crowd laughs) The traditional elites, political elites, and the establishment have a very close relationship with Wall Street. You all see it: Trump talked about Biden’s son, “You have investment funds around the world.” Who helped him build the funds? You understand? There are transactions involved. (laughter) So at this point in time, we use an appropriate way to express a certain kind of goodwill. (applause) ~Di Dongsheng, Vice Director and Secretary of the Center for Foreign Strategic Studies of Chinaref 55 January 6th Capitol Insurrection Alec Baldwin killed more people in 2021 than did the January 6th insurrectionists. Anybody reading this far knows that the January 6th riots stemmed from the right-wing voters who doubted the veracity of the 2020 election. Twitter polls show that view is not as partisan or as rare as the media would lead you to believe. I happen to doubt U.S. election integrity but have for quite a few election cycles. ref 1 Hacked Stratfor emails show the democrats rigged the vote in ’08 ref 2 and Republicans rigged it in ’04.ref 3 It is bipartisan Capture the Flag with red and blue pinnies.ref 4 In any event, Trump’s Green Goblin strategy was to beckon the MAGA faithful to the Capitol to protest the Electoral College signing off on the results. It was not so different than the mobs outside the courthouses trying to subvert the Rittenhouse and Chauvin trials, but the scale of January 6th was much larger and the optics were Biblical. It got out of hand and, at times, even a little Helter Skelter. Mob psychology elicits dramatic changes in brain chemistry and has been the topic of many laboratory studies.”ref 5 Temporary insanity is not a crazy defense. My Tweet got some hysterically hateful responses from the Right who missed the sarcasm and the Left who did not. I think I squandered more of my valuable time left on this planet burrowing through the January 6th story than on the Covid-Vaccine combo platter. I should preface this section by noting that I was praised by a thoughtful long-time reader for being “balanced and measured and carefully worded, even on edgy topics.” I may be on the cusp of disappointing him. It’s impossible to peer at the The Great Insurrection through a non-partisan lens. Both sides may find common ground in the belief that January 6th is a profound fork in the road of the American Experiment. The sock-starching Left will celebrate it as a national holiday every year while the bed-wetting Right will try to ignore it. Both are wrong. Look at that photo and pause to ponder its implications. Put a funny caption to it. Let’s hear from some Republicans first: We must also know what happened every minute of that day in the White House — every phone call, every conversation, every meeting leading up to, during, and after the attack. ~ Liz Cheney I think Lizard nailed it. We’re on the same page. Let’s keep going… January 6 was worse than 9/11, because it’s continued to rip our country apart and get permission for people to pursue autocratic means, and so I think we’re in a much worse place than we’ve been. I think we’re in the most perilous point in time since 1861 in the advent of the Civil War. ~ Michael Dowd, former Bush strategist I would like to see January 6th burned into the American mind as firmly as 9/11 because it was that scale of a shock to the system. ~ George Will, syndicated columnist Mike and George are as unhinged as I am but on different hinges. I think they are delusional and offensive. Edging forward… The 1/6 attack for the future of the country was a profoundly more dangerous event than the 9/11 attacks. And in the end, the 1/6 attacks are likely to kill a lot more Americans than were killed in the 9/11 attacks, which will include the casualties of the wars that lasted 20 years following. ~ Steve Smith, Lincoln Project co-founder Now I’m getting the heebie-jeebies if for no other reason than the Lincoln Project is filled with Democratic operatives (or at least neocons) pretending to be Republicans—as authentic as the Indians at the Boston Tea Party or stepmoms on PornHub. We have seen growing evidence that the dangers to our country can come not only across borders but from violence that gathers within…There is little cultural overlap between violent extremists abroad and violent extremists at home… But in their disdain for pluralism, in their disregard for human life, in their determination to defile national symbols, they are children of the same foul spirit. ~ George W. Bush, a thinly veiled allusion to January 6 George got some serious guff from more than a few of the 80 million Fox-watching extremists including the Grand Wizard: So interesting to watch former President Bush, who is responsible for getting us into the quicksand of the Middle East (and then not winning!), as he lectures us that terrorists on the ‘right’ are a bigger problem than those from foreign countries that hate America. ~ Donald Trump He nailed it. I have stated previously that Bush committed war crimes. Of course, the National Security Machine chimed in… The No. 1 national security threat I’ve ever seen in my life to this country’s democracy is the party that I’m in — the Republican Party. It is the No. 1 national security threat to the United States of America. ~ Miles Taylor, a former Department of Homeland Security (DHS) official Dude! You just tarred about 80 million asses with that brushstroke. Let’s move further left to find some middle ground: They swooned for him on 9/11 because he gave them what they most crave: the view that Al Qaeda is comparable to those who protested at the Capitol on 1/6. ~ Glenn Greenwald, on George Bush’s comments Glenn is part of a growing cadre of liberals including Matt Taibbi, Tim Pool, Bill Maher, The Weinstein Brothers, and Joe Rogan who are unafraid to extend olive branches across The Great Partisan Divide at risk of being labled white supremacists and Nazis, but they are hardly emblematic of the Left. From the elite Left… I think we also had very real security concerns. We still don’t yet feel safe around other members of Congress.  ~ AOC AOC’s comment prompted one pundit to tell her to “get a therapist”, which seems correct given her moment of maximum drama was when a security guard was screaming outside her door, “Are you OK, Ma’am?” #AlexandriaOcasioSmollett began trending on social media when it was disclosed that she was not even in the building when Ragnar and his buddies showed up.ref 6 They will have to decide if Donald J. Trump incited the erection…the insurrection. ~ Chuck Schumerref 7 What ya thinking about Chuckie? We are facing the most significant test of our democracy since the Civil War. That’s not hyperbole. Since the Civil War. The Confederates back then never breached the Capitol as insurrectionists did on Jan. 6. ~ Joe Biden Joe may be on the A-Team, but he hasn’t found his way out of the locker room. The blue-check-marked liberals did not mince words… The 9/11 terrorists and Osama bin Laden never threatened the heart of the American experiment. The 1/6 terrorists and Donald Trump absolutely did exactly that. Trump continues that effort today. ~ S.V. Dáte, Huffington Post’s senior White House correspondent The only effective way for the government to respond to an act of war by domestic terrorists is to be prepared to meet them with machine guns and flamethrowers and mow them down. Not one of those terrorists who broke through police lines should have escaped alive. ~ a Washington Post commenter Moving as far left as you can by tuning into the most cunning commie who can outfox any Western leader… Do you know that 450 individuals were arrested after entering the Congress? They came there with political demands. ~ Vladimir Putin The Cast of this Drama. This Kafkaesque narrative will be scrutinized by historians and democratic operatives for years to come. The Left will cast this event as a truly unique moment in US history, but it was precedented. I see parallels with the 1920’s Bonus Army in which World War I veterans were pissed off about unpaid post-war benefits.ref 8 In the saddest of ironies, many were killed by Army regulars. Some authorities, including a young Dwight Eisenhower, thought it was a benign protest while others thought it was an assault on America. Grumpy crowds appear at the Capitol only on days of the week that end in “y.” Recently, f.....»»

Category: blogSource: zerohedgeFeb 6th, 2022