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TOGETHER WITH
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Good morning. If you're excited about today being 4/20, we have some news for you...the entire month is 4/20!
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NASDAQ
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8,650.14
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- 3.59%
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S&P
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2,874.56
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- 11.03%
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DJIA
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24,242.49
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- 15.05%
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GOLD
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1,692.10
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+ 11.32%
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10-YR
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0.643%
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- 127.70 bps
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OIL
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17.43
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- 71.52%
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*As of market close
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U.S. markets: Tech and biotech stocks led the gains last week. But short sellers (investors betting against the market) haven’t been this aggressive in years. This week will feature major earnings reports and the return of that nightmare unemployment claims chart on Thursday.
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COVID-19: Total cases topped 2.3
million worldwide, and the U.S. has reported more than 40,000 deaths.
Some countries in Europe are beginning to ease lockdown restrictions,
but experts say the U.S. isn’t doing enough tests to do the same.
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Giphy
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Where
federal and state policy meet is like the crack between your stove and
countertop: The things that fall down there are out of sight, out of
mind.
Well...until
a pandemic hits. Policies intended to curb the spread of COVID-19 are
highlighting some of the peculiar paradoxes of industries that follow
different rules at different levels of government—industries like
cannabis.
- Recreational marijuana
is legal in 11 U.S. states, and medical use is permitted in 33 (both are
allowed in Washington, D.C.). Some states have deemed marijuana
businesses "essential" and allowed them to stay open during the shutdown.
- However, cannabis remains illegal at the national level.
To recap: necessary for people's livelihoods in some states, breaking the law federally. Or as one law professor put it to the WaPo: “Yesterday’s vice is considered today’s essential service.”
Essential, but not eligible
While many cannabis companies saw a boom in the early days of lockdown, sales are now dipping. Many are experiencing additional financial pressures adjusting operations to delivery or drive-thru.
- However, because of
their status at the federal level, marijuana companies were not eligible
for any of the $350 billion in small business loans made available
through the CARES Act.
Zoom out: Marijuana companies are used to being denied by large institutions: Big banks won’t touch the stuff, fearing legal blowback. Some small credit unions have stepped in, but the sector still mostly depends on cash transactions.
What’s next?
Pro-cannabis legislators and business owners are pushing for
access to Small Business Administration funds that might be included in
the next relief package. Also in play is the SAFE Banking Act, a bill
that would keep
federal regulators from taking any “adverse action” against financial
institutions that work with cannabis companies. It passed the House last
year but the Senate is a different story.
+ Want to learn more? Sign up for our newsletter Retail Brew, which is going into more detail on cannabis companies later today.
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U.S.
lawmakers are nearing an agreement to refill the Paycheck Protection
Program’s coffers with $310 billion, days after the first $350 billion
evaporated.
Yesterday, Treasury Sec. Steve Mnuchin and Democratic party leaders said the Senate could reach a deal
as early as today and secure House approval Tuesday. The bill would
also include $75 billion for hospitals and $25 billion for increased
COVID-19 testing.
Will they work out Round 1’s kinks?
Banking execs compared PPP’s opening day to “a stampede through the eye of a needle.” Most small biz relief funds were accounted for within minutes, but demand hasn’t dropped off since PPP ran out of funding last Friday.
- JPMorgan disbursed
$14 billion in loans (more than any other bank)...but still has about
$26 billion worth of applications waiting for additional federal
funding.
There’s been controversy. PPP
was designed to help companies with <500 a="" but="" chains="" cover="" data-saferedirecturl="https://www.google.com/url?q=https://link.morningbrew.com/click/20074871.1638459/aHR0cHM6Ly93d3cuYnV6emZlZWRuZXdzLmNvbS9hcnRpY2xlL2RhdmlkbWFjay9jb3JvbmF2aXJ1cy1zbWFsbC1idXNpbmVzcy1sb2Fucy1iaWctY29tcGFuaWVzLXBvdGJlbGx5P3V0bV9zb3VyY2U9bW9ybmluZ19icmV3/5e5e53fefbd29766fa7b3c1eBfafc8e82&source=gmail&ust=1587474802381000&usg=AFQjCNFUM3rjKye_dfIObcUtDdTjdTU5rw" employees="" have="" href="https://link.morningbrew.com/click/20074871.1638459/aHR0cHM6Ly93d3cuYnV6emZlZWRuZXdzLmNvbS9hcnRpY2xlL2RhdmlkbWFjay9jb3JvbmF2aXJ1cy1zbWFsbC1idXNpbmVzcy1sb2Fucy1iaWctY29tcGFuaWVzLXBvdGJlbGx5P3V0bV9zb3VyY2U9bW9ybmluZ19icmV3/5e5e53fefbd29766fa7b3c1eBfafc8e82" large="" of="" payroll="" rel="noopener" several="" style="border-bottom: 2px solid rgb(28, 127, 242);" target="_blank" thousands="" with="">secured maximum payouts
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. Potbelly, Ruth’s Chris Steak House, and Shake Shack received a combined $40 million in loans.
When things
are uncertain, we often turn to Mary Meeker to pull away the cobwebs.
The venture capitalist, best known for her annual “Internet Trends”
report, just released a paper on COVID-19 with her team at Bond Capital. It was published first by Axios.
Our takeaways:
We live in a virus’s dream world: More people are living in cities and traveling between cities than ever before. And viruses don’t need to go through customs.
Scientists are collaborating at warp speed: They’ve
published around 3,000 papers on COVID-19, which is 20x the published
research of other infectious diseases at the same point in the public
health response.
Zoom has made history: Its surge ranks among the most remarkable growth stories in the internet age, outpacing even Instagram and Fortnite.
Federal relief was swift and massive: The U.S.’ $4.3 trillion of monetary and fiscal stimulus = 124% of government revenue in 2019.
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Bond Capital
Looking ahead...“It’s
hard to know exactly what return to work will look like.” While many
businesses will never recover, “there will be new businesses that would
have been inconceivable just a few years ago.”
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SPONSORED BY COMPARE CREDIT
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Last Friday,
our more eagle-eyed viewers noticed a simple but effective and also
eloquent Compare Credit™ ad telling them how they could win $1,000. That offer is still on the table, but we’re here to talk about something equally chill.
Compare Credit™ has put together a list of credit cards
so great in their cash back, and so low in their APR (which is to say,
0%), that just opening the page may cause your pupils to dilate.
- You’re looking to pay 0% interest until 2022 on balance transfers (up to 21 months)
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You want to pay 0% interest on new purchases for up to 14 months while earning up to 5% cash back
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You really enjoy visiting new websites
Feels like a pretty decent time to be taking care of debt or saving on interest, yeah? Yeah.
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Town of Narragansett, RI
Last Thursday, President Trump handed
governors the baton to reopen America. But a new study warns states
lack the testing capacity to safely relax lockdown restrictions.
Harvard researchers estimate
states need to conduct 152 tests per 100,000 residents daily. But 34
states were conducting fewer than 50 tests per 100,000 people during the
week ended April 15.
Just one state meets the threshold. Faced
with the prospect of summer beach walks without Del’s frozen lemonade,
Rhode Island mobilized. It's been administering 185 tests per 100,000
residents.
- The secret sauce? On April 6, hometown hero CVS Health opened a rapid-testing clinic, doubling testing capacity. The state’s also the size of a U-Haul.
Zoom out: The debate around when to reopen is turning into a 2020 edition of the Federalist Papers. On Sunday, Vice President Pence called on governors
to mobilize state labs. But Republican and Democratic governors pushed
back, insisting they lack supplies needed for widespread testing, like
swabs and reagents. Last night, Trump invoked the Defense Production Act
to compel private manufacturers to make more swabs.
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U.S. Coast Guard via Getty Images
Before we go forward, let's go back. Today is the 10th anniversary of the explosion
of BP’s Deepwater Horizon oil rig, which killed 11 and sent the
equivalent of 4 million barrels of oil into the Gulf of Mexico. The
spill, often regarded as the worst environmental disaster in U.S.
history, cost BP more than $65 billion.
Monday: Boeing resumes production in Washington state; IBM earnings
Tuesday: Existing home sales; earnings (Coca-Cola, Netflix, Snap, Chipotle, Travelers)
Wednesday: 50th anniversary of Earth Day; earnings (Delta, AT&T, Quest Diagnostics)
Thursday: Weekly
unemployment claims; new home sales; NFL Draft begins; Ramadan begins;
earnings (Intel, Eli Lilly, Domino’s, Southwest, Capital One,
Blackstone)
Friday: Durable goods orders; earnings (Verizon, American Express, Sanofi)
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Facebook will roll out a gaming app today to take on Google's YouTube and Amazon's Twitch, per the NYT.
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Bankruptcy watch: 24 Hour Fitness (potentially in the next few months) and Neiman Marcus (maybe this week).
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Matt Maddox, the CEO of Wynn Resorts, called on Nevada to conditionally reopen parts of the economy in early May.
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Walmart and Sam’s Club will require store workers to wear masks or face coverings beginning today.
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Marc Andreessen: "It's time to build."
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Vitamin C and zinc citrate are just a scoop away. Athletic Greens
is an easy all-in-one nutritional beverage that contains 75 vitamins,
minerals, and whole food-sourced ingredients for gut health, immune
support, energy, and recovery. Order today for a free 20 count travel pack.*
Make smart money moves. UBS created their financial participation website
to help women take control of their financial future. Find tips, tools,
and the top 10 money moves—without all the jargon. Start with their
money language quiz here.*
Work Learn from home: Enroll in NYU Professor Scott Galloway’s two-week crash course
that breaks down the winning strategies of tech behemoths like Amazon
and Apple. Take your career to the next level through an online
experience that's flexible with your schedule. The May course is only
open to Brew readers, so sign up today.*
Fun way to find new music: Radio.garden
lets you listen to radio stations from all over the globe. Loving
Philadelphia's WXPN and whatever they're playing in northern Finland.
*This is sponsored advertising content
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Just call us the Brew York Times. Today, Beyond Crossword has graduated from its kindergarten roots to become a real life, 15x15 crossword puzzle thanks to Brew writer Toby Howell.
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You only need 5 more referrals to receive Morning Brew stickers.
In
the wise words of a certain Jedi master: “Sticker or no sticker, there
is no point in having a laptop if it doesn’t have a Brew sticker on it.”
Or something like that.
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