Let’s digress.
We Work attempts to come public at $47 billion. Corrupt investment banks tell them to fuck off, probably because their in house counsel warned them about some obvious fraud of scam. We Work keeps fishing for suckers in their IPO dreams, only to be cast aside as fucking idiots morons. Valuation plummets from $47 billion to under $10 billion in less than a month, revealing what the in house counsel at JP Morgan knew all along.
Softbank freaks out because We Work needed to IPO in order to keep the shell game going. They have two options: fire thousands of workers and let We Work go bust, or bail them out in the hopes of righting the ship and an eventual IPO.
They chose the latter.
As part of the $8 billion deal to take control of We Work, Founder and CEO Adam Neumann will get bought out for $1.7b and sever ties with the company.
You’ve got to love capitalism, rewarding failure with billions.
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typo in the first sentence; I think you meant — “fraud of scum”
No, the real fraud is Softbank.
Hello Neumann – “We had a deal. Are you reneging out of the deal? Are you reneging? That’s a renege.”
“How do you know it’s the biggest bubble in history? This slide from Softbank pic.twitter.com/065dyDrwZW”
— zerohedge (@zerohedge) September 8, 2019
Hillarious, yet accurate. It’s mind-boggling that was an actual slide and not from an SNL skit.
I don’t see how this payout goes through. Perhaps somebody is misreading things, as I saw that $1B would go to *unspecified* stockholders. They probably will give some of that money to others so that they don’t jump off this train wreck. How can it be worth $1.2B just to get rid of a guy in an $8B company? What kind of skeltons are in the closet? If this payout is real, then Neuman must know something about Softbank. Perhaps all their “unicorns” have taped-on horns?
UPS, down 5%: earnings are great, but pay no attention to the fact our COO is leaving and we are dropping CAPEX by $1B over the next two years.
PG: no ATH for you. Tell me gain why your PE is now 25-30, when it was ~5 for years?
UTX: just liek PG, on the way to ATH but then abrupt turn around
Bullish
Scotomization is real
Absolutely. It’s extremely evident in partisan politics.
As for financial markets, herd mentality is a much stronger factor, as people don’t evn bother to make valuation judgements so scotomization becomes unnessecessary.
BTW, you do realize that the bulls still haven’t managed a SPY close above 300 in 5-7 days of trying? Apparently, yesterday’s close was 299.99. Compare that to July and Sep’s breakouts above 300. Looks like bulls may finally get it done today.
However, suppose that we get another close below 300. What is your interpretation of that?
It’s basically impossible to make consistently profitable short term trades based on valuation though. Long term sure. Risk management is key by cutting losses quickly if you’re into short term trades. I manage risk with a healthy holding of bonds and cash (31% is my current target), and some once every couple year signals that might get me to put on an option hedge. I’m willing to accept lower long term returns for reduced portfolio volatility. Average yield across my portfolio is currently 2.48% which is enough to cover monthly fixed expenses. We’re not playing the same game and for the most part I’m being a troll with my responses to you. I do appreciate your POV in general. Even though I don’t swing trade, this blog provides some of the most entertaining and thought provoking content in the financial blogosphere.
Closing price for today doesn’t mean much to me, even if it does to other market participants. Seasonality should be a tailwind for equities over the next several months and considering the strength so far in October and 2019 in general, it’s potentially a steamroller I wouldn’t want to be in front of. I’m expecting to be buying more bonds in Q4 and hope that happens at lower prices.
I’m playing a dual game. For the most part, my portfolio is targeted at least 2 months out, usually theta positive option spreads.
However, I wil ltake short-term plays if i see them. ROKU was an example of that. I’ve also dipped into Nov TLT calls.
In realted news: given the reaction to Johnson’s Brexit fumlbe within the last hour, we’ll soon see if this 2-week failure to breech 300 means anything.
As an FYI, the UK Parliament will be having another Brexit vote at 2pm EST
https://www.bloomberg.com/news/articles/2019-10-22/johnson-finally-gets-to-put-his-deal-to-the-vote-brexit-update?srnd=premium