|The Big Idea|
What’s behind the crazy market rally? A billionaire investor explains
The S&P 500 is up ~50% since its March low, and back near its all-time high.
The mind-blowing rally is taking place as the economy saw its worst quarterly GDP contraction in 70+ years.
WTF is going on?
A popular (but unsatisfactory) answer is: “the Fed is pumping the markets.”
For a more thorough explanation, the billionaire investor Howard Marks recently published one of his famous “memos.”
We broke it down
The S&P 500 traditionally trades at a price-to-earnings (P/E) ratio of 16x. But with interest rates near zero, the P/E ratio should trade at a 50% premium (24x) or higher (all things being equal, a higher P/E = higher stock price).
In layman’s terms: the Fed’s interest-rate cuts are boosting stock valuations.
And the FAAMG stocks (Facebook, Amazon, Apple, Microsoft, Google), which make up 15-20% of the entire market, are exceptional, Marks says.
FAAMG is going HAM
On average, the FAAMG stocks are up 36% on the year, but the median S&P 500 stock is down 11%. The bull argument says the giants’ rise can continue because…
So where does that leave Marks? He’s not totally convinced by the bulls’ argument, but says it has “obvious merit.”
If making sense of the market comeback still doesn’t make sense, Marks says, listen to some Charlie Munger wisdom: “It’s not supposed to be easy. Anyone who finds it easy is stupid.”
5 stories to catch you up quick
1️⃣ Microsoft isn’t the only suitor in town: Twitter has had preliminary talks with TikTok about a potential US deal.
2️⃣ Speaking of: TikTok may file a lawsuit against the Trump Administration.
3️⃣ Toshiba — which made the first IBM-compatible laptop way back in 1985 — is getting out of the laptop business.
4️⃣ A federal court just rolled back a 1940s-era rule that kept film studios from owning movie theaters.
5️⃣ $400-per-week unemployment payments and rent assistance: Here’s a look at what is — and isn’t — in this weekend’s executive orders.
And 5 more to delight you
1️⃣ The Big Bang? According to new computer simulations, the universe actually began with the Big Bounce.
2️⃣ American Idol has a new recruitment pipeline: TikTok.
3️⃣ An EU-Canada trade deal is at risk of unwinding — all because of halloumi cheese.
4️⃣ The UK’s diplomat cat is retiring after 4 years on the job. In his resignation letter, he said that he wants time “away from the limelight.” (Same.)
5️⃣ HBO Max and Ava DuVernay are turning the “One Perfect Shot” Twitter account into a TV show.
|Print it to win it|
3D bioprinting could help with COVID research and organ transplants
When a group of researchers didn’t have the budget to buy a 3D bioprinter — a highly specialized machine that prints living tissue — they decided to make their own.
They now steer a bioprinter startup called Foldink. Other bioprinters can cost as much as $200k, but Foldink wants to be a low-cost option.
The technology could help surgeons print skin grafts for burn victims or organs for transplant patients.
Dr. Frankenstein would have been insanely jealous of this tech — no spare body parts or alchemy necessary.
3D bioprinters use bio-ink, a substance made from live cell cultures, to make stackable, Lego-like units of tissue.
Currently, researchers are printing teeny-tiny lungs and colons to test COVID-19 drugs.
If you can print tissue, you can print money
Tissue engineering is hot. The global market is expected to see a compound annual growth rate of ~14% annually, reaching ~$30B by 2027.
The most important word in real estate?
Location, location, location.
The most important word in investing? Diversify, diversify, diversify.
But how do we actually… well, do it?
3 easy steps in as little as 10 minutes
With nearly $12B in assets and 35+ years of experience, Jamestown Invest makes it easy to diversify your portfolio through real estate.*
The best part? You don’t have to be the Monopoly Man to afford it.
This digital investment platform gives you access to rigorously vetted, institutional quality real estate for as little as $2.5k.
It takes 10 minutes to get started. Why wait?
|Talk About Renaissance|
Drink like Da Vinci: Italy is bringing back its 17th-century ‘wine windows’
Want to buy an aperol spritz or a gelato without stepping indoors? The holes in the wall have you covered.
Because of the coronavirus, shops in Tuscany are reviving a centuries-old sales trick — arched, stone hatches called “wine windows.”
It’s like medieval drive-thru: Call out your order through the buchette del vino, and a phantom hand will serve you.
Where did these things come from?
17th-century Italian aristocrats wanted to run wine businesses, but they weren’t so keen on paying taxes.
So they carved up slits in their cellar walls to sell vino on the DL.
Then the bubonic plague hit
Wine windows became a safe way to do business. A recent survey found ~300 still exist.
Now you can pay by credit card — but back in the day, you dropped coins into a metal holder, and the seller disinfected them with vinegar.
Contactless tech? That’s so 1600s.
Turns out even farmers are raking in that sweet, sweet influencer cash.
Running a small farm has become less profitable over the years. To supplement their income, some growers are chronicling their slip-ups on YouTube and Instagram.
One Vermont farmer, Morgan Gold, earns $2.5k to $4k a month in ad revenue — about 8x what he makes from selling produce and other goods.
(Source: The New York Times)
Knock Your Customer Acquisition Costs (CAC) Out Cold
With the MLB and NBA back in action, the Trends team wanted to bring you insights from leading sports minds.
Co-founded by UFC Champ Micahel Bisping and NBA all-star Roy Hibbert, this sports gaming platform has partnered with major sports leagues, attained 300k registered users and reached $17m in gross revenues in just two short years.
Playline achieved this rapid growth by owning and operating (in partnership with Mark Cuban) some of the most highly-engaged, sports-focused communities across social media.
This strategy is key in helping the company achieve the lowest customer acquisition costs (CAC) in the industry.
Join Bisping — and Playline co-founder Aaron Avruskin — as they walk through the Playline playbook and reveal growth hack secrets to lowering your CAC including:
- How to take ownership in your funnel for customer acquisition
- How to turn CAC into a positive revenue generating line item
- How to structure deals with ad partners
- How to ensure the greatest ROI possible in digital media
These sessions are normally gated for Trends subscribers only. This week, we’re opening up the ring to all Hustle subscribers. Join us on Thursday 8/13, at 3pm ET (12pm PT).
Brands and influencers have the acne-positivity movement popping
Condolences to everyone who put toothpaste on their forehead in middle school. Acne is cool now.
Slate says Instagram influencers are embracing pimple positivity — busting a major source of teenage angst as ruthlessly as Dr. Pimple Popper.
It’s a new spin on a serious issue
More than 70% of teens said their acne makes them less attractive, according to a survey by a pharmaceutical company. Medical experts say people with acne are at risk of developing anxiety and depression.
Your Accu-pain is over
Kadeeja Sel Khan, a skincare influencer, went viral on Instagram after posting an unfiltered makeup tutorial featuring her bare skin.
“I was tired of pretending I’m this ‘perfect’ person when in reality no one is,” she told British Vogue. “I never in my life thought I’d feel so happy in my body and myself as I do now.”
What does a 49er’s football coach and Disney’s Workplace Culture Expert have in common?
They’ve both got a little thing called perspective.
And it’s on some of the most challenging, innovative topics facing our world today.
How do the rest of us gain some of that? By tuning in to Real Talk’s video series with these leaders. Considered early adopters by the communities they serve every day, they’ve put their heads together to inspire others, share ideas, and ultimately, shape the future.
With easily digestible 30 to 60 minute videos, you too can become a thought leader in our ever-changing world. And maybe even help change it. Check out the first episode on 8/19 and keep coming back to see who’s up next.
|Let’s do this →|
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Editing by: Nick “Out of Ink” DeSantis, Denise Hoyt (Staff Orthopedist).
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