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Good morning. You
know when something doesn't work right, a person shouts “technical
difficulties!” then everyone laughs nervously? That person is us right
now explaining why our email was a few hours late yesterday.
Sorry about that. Glad to once again be in your inbox at this egregiously early hour.
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NASDAQ
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10,632.99
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- 3.02%
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S&P
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3,236.97
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- 2.37%
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DJIA
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26,764.25
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- 1.92%
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GOLD
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1,862.00
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- 2.39%
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10-YR
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0.673%
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- 0.20 bps
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OIL
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39.57
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- 0.58%
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*As of market close
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Markets: If yesterday's S&P 500 chart were a hill you were biking on, you would not have to pedal much. Stocks fell throughout the day, led by drops in all the Big Tech names.
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2020: In a press conference last night, President Trump refused
to commit to a peaceful transfer of power, saying, “Well, we’ll have to
see what happens” should he lose to Joe Biden. Trump's unsubstantiated
allegations of voter fraud and attacks on the democratic process are
causing all kinds of uncertainty in the stock market.
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JEFF DEAN/AFP via Getty Images
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When the summer of 2020 began, protests against racial injustice were erupting
across the U.S. following the killings of George Floyd, Breonna Taylor,
and Ahmaud Arbery. Corporate America reacted with promises to
strengthen commitments to racial equality.
Now as the
leaves change, the legal system weighed in on punishment for the police
officers involved in one of those catalytic deaths. A grand jury
yesterday indicted
Brett Hankison, a former Louisville police officer, with “wanton
endangerment” for recklessly firing shots into the homes of Taylor’s
neighbors; no charges filed were related to her killing.
And the business world is still working out how to follow through on its promises. It was a busy day:
Wells Fargo CEO Charlie Scharf apologized for a June memo, reported on Tuesday by Reuters, in which Scharf said
a “very limited” talent pool was the reason for the lack of Black
employees at the bank. 4.1% of Wells Fargo’s senior workforce was Black
in 2018, down from 8% in 2015.
- Scharf’s comment echoed
past justifications for the financial industry’s abysmal track record
with diversity, but critics argue it’s a cover-up for insufficient
recruiting efforts.
Elsewhere on Wall Street, Citi made a hefty pledge. It earmarked
over $1 billion for initiatives that help close the U.S.’ racial wealth
gap and provide economic resources for people of color. That means
investments in Black-owned businesses, boosting credit access in
communities of color, and helping increase Black homeownership.
Cisco made a pledge of its own. The networking equipment company vowed
to increase the number of Black employees in entry-level to manager
positions by 25% in the next three years. Cisco has no Black people on
its executive leadership team.
And Mars dropped its offensive Uncle Ben’s brand. The food giant will rename the rice product Ben’s Original, which will retain the aspects of the brand not linked to racist stereotypes.
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Yesterday, prescription drug pricing app GoodRx went public
on the Nasdaq under the ticker GDRX. It opened at $46/share, well above
its $33 IPO price, and closed the day up 53% for a market cap of $19.4
billion.
The backstory: You know how medications sometimes cost $6 but other times cost $7,439? GoodRx wants to help by offering coupons for prescription drugs and helping you comparison-shop.
- Because here’s the thing
about medicine...it makes pain/sickness/eczema go away. So most people
don’t hesitate to pay the amount they’re charged and often don’t know
they have options.
Business-wise,
GoodRx is in decent shape. It’s been consistently profitable since
2016, earning revenue by collecting fees from the pharmacy benefit
managers it works with. It made almost $55 million in profit in H1 of
2020, up 75% from the same period last year...but by the cofounders’ own admission, healthcare reform would wipe it off the map.
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Volkswagen
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Yesterday, California Governor Gavin Newsom issued an executive order that calls for a ban on the sale of new gasoline-powered cars in the state by 2035.
An
announcement like this a few years ago might have resulted in legacy
automakers shaking their treads, but in 2020’s red-hot electric vehicle
market, they’re honking their approval.
- Ford released a statement
saying it’s “proud to stand with California,” noting it’s in the
process of trying to “electrify our most iconic nameplates like the
F-150 and the Mustang Mach E."
- Also yesterday, Volkswagen unveiled its new all-electric SUV
for the U.S. market. The ID 4 (pictured above) costs just under
$40,000, has a not-quite-Tesla range of 250 miles, and hopes to further
cleanse consumers’ palates of the Dieselgate emission scandal of 2015.
Bottom line:
Gov. Newsom’s order, combined with the 15 countries that have adopted
similar goals, shows that government regulation and automakers’ heavy EV
investments are finally aligning.
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No, not that one. (How old do you think we are?)
The one about what to do with our money now that we’ve got a real job. Their recommendation to us? E*TRADE.
Turns out E*TRADE does way more than just trading. They have a full suite of offerings across investing, retirement, banking, and of course, trading.
Now when we have money-related questions, we turn to E*TRADE’s easy-to-use tools to help us set smart financial goals and make the most of our money.
TBH, not texting our parents for finance tips has been great. Plus, E*TRADE never asks why we aren’t married yet.
Take control of your investments online and put your money to work with E*TRADE.
Learn how E*TRADE can help you make smarter financial decisions.
*Paid Advertisement
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Echelon Fitness
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On Tuesday, Echelon Fitness released a $500 workout bike “in collaboration with Amazon” called the EX-Prime Bike. Those quotation marks are sarcastic air quotes as much as they reflect Echelon’s actual language because...
There was no collaboration
On Tuesday evening, Amazon disavowed
any connection to the bike. “Echelon does not have a formal partnership
with Amazon,” a spokesperson told Bloomberg. “This bike is not an
Amazon product or related to Amazon Prime.”
- Tell that to Peloton, whose stock fell as much as 7% when news broke that Amazon was supposedly peddling into living rooms.
Bottom line: Even though Amazon has nothing to do with the bike, the episode once again highlighted concerns
around Peloton’s luxury prices. Its forthcoming cheaper treadmill costs
$2,495 and its cheapest bike will set you back $1,895, potentially
leaving it vulnerable to lower-cost alternatives like the one Amazon
just unintentionally pump faked.
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Francis Scialabba
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—MKM Partners analyst Bill Kirk to Aurora Cannabis.
Shares of the Canadian marijuana producer fell 29% yesterday after reporting quarterly results that were less dank than expectations.
- Shares hit a four-year low. Remember, four years ago...weed wasn’t even legal in Canada (that happened in 2018).
What’s going on? Aurora misjudged the market for legal cannabis in Canada, focusing on premium products instead of more popular budget items, reports MarketWatch.
- And that’s what Kirk was getting at. “Aurora grows more stuff that people don’t want than they grow stuff people want,” he said.
Looking ahead...Miguel Martin, Aurora’s third CEO this
year alone, admitted the company “slipped from its top position in
Canadian consumer,” and his focus is to get back to the top
“immediately.”
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Gordon Gekko in 'Wall Street'
Whether you
say it “FYE-nance” or “fih-NAHNCE,” “finance” can be a daunting word.
That’s partly because it refers to several different overlapping
universes—there’s corporate finance, personal finance, government
finance, and...finance finance, aka what it is all those well-dressed
folks in lower Manhattan get up to all day.
That’s where
we come in. The expert curators at Morning Brew have tapped industry
pros, sifted through years of blog posts, and read every shareholder
letter Warren Buffett's ever sent to bring you a 10-step guide to the best resources in finance.
-
What you won’t find: Fluffy websites that tell you what you already know, like "the stock market doesn't equal the economy."
-
What you will find: Insightful case
studies, podcasts, articles, and more that will give you a 101-level
understanding of finance without putting you to sleep.
Check it out.
This article is part of Morning Brew's Syllabus Series. Read last week's edition on Marketing 101 here.
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September 24
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| FEATURED BIOGRAPHY
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| Jim Henson
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| FEATURED EVENT
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| 1957
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| Federal troops sent into Little Rock, Arkansas
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Advertisement
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Advertisement
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| MORE EVENTS ON THIS DAY
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2015: According to Saudi officials, 769 people died in a stampede during the hajj to Mecca;
however, other estimates claim that more than 2,400 were killed, making
it one of the deadliest accidents in the pilgrimage's history. [
Watch a video overview of the hajj.]
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1968: The prime-time American television news show 60 Minutes
debuted; created by Don S. Hewitt and featuring such reporters as Mike Wallace, it became one of the most successful programs in broadcast history.
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