Price Drives Narrative

We are all trend-followers

January was a great month for Wall Street. There was a mad dash-for-trash triggered by a short-covering rally. The most hated and shorted stocks went up the most. And Cathy Woods’ ARKK is the “Next NASDAQ” (bloomberg).

“ARKK is a joke”

“ARKK is the Next NASDAQ”

Speaking of narratives, while we are all focused on the ongoing Adani-Hindenburg cage-fight, have we forgotten that the stock of the flagship went up 1100% post-pandemic? Once the price started cliff-diving, the narrative flipped, and regulators are now suddenly awake. How utterly predictable.

Markets this Week

More here: country ETFs, fixed income, currencies and commodities.

Links

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Electric Vehicles are on a class of their own.

Ford showed this week that it’s not going to be as easy for traditional automakers to catch Tesla in the race to build the better electric vehicle, despite what Tesla’s doubters think. (CNN)

Peter Campbell @Petercampbell1

Akio Toyoda is too much of a "car guy" to lead Toyota for the future, he says. Full story from @SugiuraEri, @KanaInagaki & @Urbandirt: ft.com/content/11e4e5…

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They keep talking about the energy transition but what’s up with coal and what’s going on in wind energy?

Javier Blas @JavierBlas

Interesting slide from Siemens Gamesa, the 2nd world's largest manufacturer of wind turbines. It reports that onshore turbine orders dropped 46.3% y-on-y in the last quarter. And the cost of those turbines (€ per MWh) went up 25% y-on-y | #EnergyCrisis #Windturbines

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Markets are usually good at meeting demand. Excess demand is usually met with excess supply. Hence, business cycles.

Cardboard box demand plunging at rates unseen since the Great Recession (freightwaves)

Dan Alpert @DanielAlpert

How quickly the pandemic era supply shortages turn to post-pandemic glut. The bellwether for the semiconductor industry - memory chips - are now experiencing oversupply again. Can processing chips be far behind? Another example of: #ItWasThePandemicStupid

wsj.comMemory-Chip Makers Face a Prolonged Price SlumpPrices of the chips are expected to keep falling in the first half of 2023, putting more pressure on an industry that has already cut investments and jobs.

Semi-conductor ETF (SOXX) vs. S&P 500 ETF (SPY)

A. Manufacturing things gets cheaper with scale.
B. Constructing things in the field gets more expensive with time.

thread

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Never bet against human ingenuity. As we get rid of existing diseases, we are constantly inventing new ones.

Guinea worm disease, the second human illness to be eradicated? (cbc)

Agathe Demarais @AgatheDemarais

🗺️🌡️- Habitat loss and climate change increase the risk of new diseases • Global warming, by forcing animals to change habitats, fuels viral spread between animal species • 90% of such contacts involve bats, because they travel long distances and interact with lots of species

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Don’t reinvent the wheel, do this instead:

Good places to look for +EV (thread)

How likely is it that the company’s products and services will be at least as relevant to its customers a decade from now? (intrinsicinvesting)

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Sometimes, you just need to shoot at something to feel better.

U.S. Naval Institute @NavalInstitute

Since "Chinese Spy Balloon" is trending: In 1945, the crew of USS New York spotted a sphere that they thought might be a Japanese balloon weapon. The captain ordered it shot down but none of the guns could score a hit. Finally, a navigator realized they were attacking Venus.

Meme of the Week

@alifarhat79