Big changes – lots of year-end market S&P 500 downgrades.
Recession and stagflation
April – a quick look at some interesting highlights of April (historically)
Bill Gates out with a big prediction
The Best Deal Ever! (ELON)
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- Big changes - lots of year end market S&P 500 downgrades
- Recession and stagflation
- April - a quick look at some interesting highlights of April (historically)
- Bill Gates out with a big prediction
- The Best Deal Ever! (ELON)
- Corrections happen
- Market jumped off the down worst levels on Monday - is worst priced in?
- Earnings season starts 4/11 - JPM to report
- Year end price targets - lowering
- Yields DOWN - Was that the plan all along?
- OpenAI on Monday announced it had closed its $40 billion funding round, the most ever raised by a private tech company.
- The deal values OpenAI at $300 billion, including the new capital.
- The round comes to $30 billion from SoftBank and $10 billion from a syndicate of investors.
- Stagflation - Keyword Search hit highest point in a long time.
- Lots of talk about the potential for higher inflation and softer jobs
Friday is the UnEmp Report
- Expectations are that the rate will tick up from 4.1% to 4.2%
- 145-150k people added to the jobs rolls
---- That would till be good numbers.
Tariff Day - AKA Liberation Day
- April 2nd is the date that the retaliatory tariffs go on-
- Facts say you? (I am not a smart man....)
--- Between China and Canada, Mexico, estimates that the tariffs would bring in $150 Billion in 2025.
- The US Stock market has lost $5.25 TRILLION during the same time
- US GDP is $29 trillion annually - what is $150 BILLION going to do?
- The U.S. federal budget deficit for fiscal year 2025 is projected to be approximately $1.9 trillion.
Reagan - He is revered...ReaganOmics......
- April 25, 1987 - Radio Address..
- " And today many economic analysts and historians argue that high tariff legislation passed back in that period called the Smoot-Hawley tariff greatly deepened the depression and prevented economic recovery. You see, at first, when someone says, Let's impose tariffs on foreign imports,' it looks like they're doing the patriotic thing by protecting American products and jobs. And sometimes for a short while it works -- but only for a short time. What eventually occurs is: First, homegrown industries start relying on government protection in the form of high tariffs. They stop competing and stop making the innovative management and technological changes they need to succeed in world markets. And then, while all this is going on, something even worse occurs. High tariffs inevitably lead to retaliation by foreign countries and the triggering of fierce trade wars. The result is more and more tariffs, higher and higher trade barriers, and less and less competition. So, soon, because of the prices made artificially high by tariffs that subsidize inefficiency and poor management, people stop buying. Then the worst happens: Markets shrink and collapse; businesses and industries shut down; and millions of people lose their jobs.
- https://www.reaganlibrary.gov/archives/speech/radio-address-nation-free-and-fair-trade-4
- Talk on the street: " Tariffs are a negotiation tactic" (What does that mean anyway)
-- Assumption: "US will win the negotiation"
- - Has anyone considered: What if it does not?
- The thought is that it needs to be "fair"
- Liked when it looks good - disregarded when looks bad
- January 31 initial GDP Forecast for Q was +2.9%
- Latest April 1 -3.7%
- Core PCE well above target too...
US DEI - Mandate to Europe
- Government officials have reportedly sent letters to companies in France and the European Union that hold U.S. government contracts, warning them to comply with an executive order banning diversity, equity and inclusion programs if they want to keep their contracts.
- According to the document, "Department of State contractors must certify that they do not operate any programs promoting DEI that violate any applicable anti-discrimination laws and agree that such certification is material for purposes of the government's payment decision and therefore subject to the False Claims Act."
- Trevor Milton - Nikola Corp. founder Trevor Milton said Thursday that he had been granted a full pardon by President Donald Trump for his October 2022 conviction of federal crimes related to defrauding investors with false claims about the success of the electric and hydrogen-powered truck maker.
- President Trump on Friday commuted the prison sentence of Carlos Watson, the founder of the now-defunct digital media startup Ozy Media
- Several financial institutions have recently adjusted their S&P 500 price targets.
- Barclays reduced its target to 5,900 from 6,600 due to concerns about tariff uncertainties and slowing economic growth.
- RBC Capital Markets lowered its target to 6,200, previously at 6,500, citing trade policy worries and market volatility.
- UBS adjusted its target to 6,400, down from 6,600, reflecting the anticipated economic impact of U.S. tariffs.
- Goldman Sachs recently revised its price target for the S&P 500. The bank lowered its year-end target to 5,700 points, down from a previous estimate of 6,200 points
- Some interesting things over time that happened in April
- In April 1930, during the Great Depression, the stock market experienced a brief rally as investors were hopeful for recovery. However, this optimism was short-lived as economic conditions continued to worsen.
- April 2000, the dot-com bubble burst. This led to a massive market crash and reshaped the tech industry, bringing an end to the overinflated valuations of many tech companies.
- In April 2013, Bitcoin experienced its first significant price surge, surpassing $200 per coin. This marked a pivotal moment for cryptocurrency, bringing it into the mainstream financial conversation
- April 1998, the euro was officially announced as a currency. This set the stage for its eventual role as a major player in global finance.
- Historically, the S&P 500 has shown strong performance in April. Over the past several decades, the index has delivered an average return of approximately 1.5% during this month. April is often considered one of the better months for the market, with a high probability of positive returns.\ - Over the next decade, advances in artificial intelligence will mean that humans will no longer be needed "for most things" in the world
- At the moment, expertise remains "rare," Gates explained, pointing to human specialists we still rely on in many fields, including "a great doctor" or "a great teacher."
- But "with AI, over the next decade, that will become free, commonplace — great medical advice, great tutoring
- Gates is optimistic about the overall benefits AI can provide to humanity, like "breakthrough treatments for deadly diseases, innovative solutions for climate change, and high-quality education for everyone
-- Why would we need education of AI can do the thinking for us?
- xAI buys X for $33 billion (loss of $11 billion on the deal)
--- $45 Billion less $13 billion debt (of course it was as the original purchase was $44 billion so it shows as a "good deal" at first glance)
- All stock deal
- The "future of AI" is here!
- xAI valued at 80 billion
- OOOPS - here is the catch - Can you imagine you were part of the xAI money raise and now you own Twitter for $33 Billion???
--- What in the world is this all about? Seems like there will be some lawsuits (like when SolarCity was bought by Tesla)
- Investor trust in xAI may be shaken due to the perception that Musk used pumped-up xAI stock to execute the deal, raising questions about transparency and fairness
- Newsmax trading higher by 506% following its IPO
- Newsmax has grown in popularity, positioning itself as a competitor to Fox News in the center-right market.
- Small deal - $75 million was the IPO - created a giant squeeze.. (was as much as a 700% gain for a minute)
- NMAX UP 90% again on Tuesday - was as high as $180/share after IPO @ $10 (Hit $250 today)
- Tariff Woes
- General Motors (GM) has been identified as one of the hardest-hit automakers by the recent 25% tariffs on imported vehicles and auto parts. Only about 45% of GM's vehicles sold in the U.S. are produced domestically, leaving the remaining 55%—manufactured in Canada and Mexico
- Additionally, Stellantis, which owns brands like Jeep, Chrysler, Dodge, and Ram, has also faced challenges.
- Expectations are that new car prices will increase $5,000 - $10,000, high end models $20,000 (But we are not paying for that - just saying - SOOOOO MUCH DUMB)
- Rocket Companies has announced its acquisition of Mr. Cooper Group in an all-stock transaction valued at $9.4 billion.
- This merger combines Rocket, the largest mortgage lender in the U.S., with Mr. Cooper, the largest servicer of residential mortgages.
- Together, the combined entity will oversee a servicing portfolio worth $2.1 trillion, representing nearly one in every six mortgages in the country.
- The deal is expected to generate significant financial benefits, including $400 million in annual cost savings and $100 million in new revenue through streamlined operations and enhanced customer offerings.
Kalshi march madness bets
- Kalshi's March Madness prediction markets have gained significant traction, with over $200 million invested during the NCAA men's basketball tournament
- Binary and other betting styles
- Each contract is priced based on the probability of the event occurring, and if your prediction is correct, the contract pays out $1. This unique approach combines elements of financial trading with the excitement of forecasting real-world events
- getting very popular on other financial websites - we have one we are going to introduce you to in the next couple of weeks.
- The annualized GDP growth rate for the U.S. in 2025 is projected to be around 1.9%, according to the Congressional Budget Office
- Next quarter is supposed to be only 0.3%
- Some are marking down GDP and raising odds of a recession (Still less that 50% for most major firms)
- Microsoft has closed its IoT & AI Insider Lab in Shanghai’s Zhangjiang hi-tech zone, marking the latest sign of the US tech giant’s retreat from China amid rising geopolitical tensions.
- The Shanghai lab, meant to help with domestic development of the Internet of Things (IoT) and artificial intelligence (AI) technologies, closed earlier this year, according to people who work in the Zhangjiang AI Island area.
- Restaurant chain Hooters of America filed for bankruptcy in Texas on Monday, seeking to address its $376 million debt by selling all of its company-owned restaurants to a franchise group backed by the company's founders.
- Not to worry - not closing - just a restructuring...
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