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- ZHKNGZHKNG
  ·2021-07-22
  Go go go
  Toplines Before US Market Open on Thursday
  (Julr 22) Stock futures advanced on Thursday, with investors looking to earnings and data for impetu
  Toplines Before US Market Open on Thursday
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- ZHKNGZHKNG
  ·2021-07-16
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  Don't Fear A Stock Market Crash
  Summary Warnings and claims of a stock market crash keep surfacing as the markets continue to push
  Don't Fear A Stock Market Crash
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- ZHKNGZHKNG
  ·2021-07-16
  Cash is king
  Square: Cash App Is A Can't-Miss Opportunity
  Summary In this article, I analyze Cash App's viral growth and how Square will evolve and monetize
  Square: Cash App Is A Can't-Miss Opportunity
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- ZHKNGZHKNG
  ·2021-07-16
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  Cramer's Mad Money Recap: Why Stocks Are Going Down
  Jim Cramer says it's not so much about the economy as it is the simple rules of supply and demand. T
  Cramer's Mad Money Recap: Why Stocks Are Going Down
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Even through all this, we have central-bank liquidity remaining very abundant, economic growth being robust.”</p>\n<p>Energy and mega-cap tech stocks gained ahead of a new batch of earnings reports, the latest initial claims data and the first ECB meeting to incorporate the bank's new strategic review.&nbsp;Energy stocks Chevron Corp, Exxon Mobil, Schlumberger NV, Occidental Petroleum and Marathon Petroleum Corp climbed between 0.1% and 1%, tracking crude prices.</p>\n<p>Some other notable pre-market movers:</p>\n<ul>\n <li>Didi Global (DIDI) drops 3% in&nbsp;premarket&nbsp;trading after people familiar with the matter said Chinese regulators are considering serious, perhaps unprecedented, penalties for for the ride-hailing giant after its controversial initial public offering last month.</li>\n <li>Texas Instruments (TXN) drops 4.8% after third-quarter sales and profit forecasts left analysts disappointed, with Barclays saying the “flat outlook leaves little to live for this late in the cycle.”</li>\n <li>AT&amp;T (T) added 0.9% as the telecom operator beat analysts’ estimates for monthly phone bill paying subscriber additions in the second quarter, fueled by more Americans converting to 5G phones.</li>\n <li>Dow (DOW) rose 1.3% after its second-quarter profit doubled from the first, as prices for its chemicals used in plastics and packaging rose on the back of strong consumer and industrial demand as well as lower inventories.</li>\n <li><a href=\"https://laohu8.com/S/CEMI\">Chembio Diagnostics</a> (CEMI) gains 9.9% and <a href=\"https://laohu8.com/S/NURO\">NeuroMetrix</a> (NURO) surges 33% amid discussions on message boards at Reddit and StockTwits.</li>\n</ul>\n<p>Elsewhere, the Labor Department’s report, due at 8:30 a.m. ET, is expected to show the number of Americans filing new claims for unemployment benefits fell to 350K (from 360K) for the week ended July 17, amid rampant worker shortages. Investors have been closely following the health of the jobs market on which monetary policy hinges, especially after a series of higher inflation reading recently sparked fears about a sooner-than expected paring of policy support as the economy reopens.</p>\n<p>Bitcoin briefly rose above $32,000 after getting a boost from Elon Musk, who said his space exploration company SpaceX owns the digital token.</p>\n<p>In commodities oil hung on to most of Wednesday's sharp price rise, its biggest one-day gain in three months. Brent crude futures were last 0.4% softer at $71.94 a barrel, but had gained more than 4% on Wednesday. Gold was steady at $1,801 an ounce and cryptocurrencies were firm after bouncing from lows when Tesla boss Elon Musk said the carmaker would likely restart accepting bitcoin payments after due diligence on its energy use.</p>","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Toplines Before US Market Open on Thursday</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nToplines Before US Market Open on Thursday\n</h2>\n\n<h4 class=\"meta\">\n\n\n<a class=\"head\" href=\"https://laohu8.com/wemedia/1079075236\">\n\n\n<div class=\"h-thumb\" style=\"background-image:url(https://static.tigerbbs.com/8274c5b9d4c2852bfb1c4d6ce16c68ba);background-size:cover;\"></div>\n\n<div class=\"h-content\">\n<p class=\"h-name\">Tiger Newspress </p>\n<p class=\"h-time\">2021-07-22 19:48</p>\n</div>\n\n</a>\n\n\n</h4>\n\n</header>\n<article>\n<p>(Julr&nbsp;22)&nbsp;Stock futures advanced on Thursday, with investors looking to earnings and data for impetus to extend a 2-day rally that wiped out losses sustained during the worst trading day of 2021.</p>\n<p>At 7:54 a.m. ET, Dow E-minis were up 47 points, or 0.14%, S&amp;P 500 E-minis were up 6.5&nbsp;points, or 0.15% and Nasdaq 100 E-minis rose 28.75 points, or 0.19%.&nbsp;</p>\n<p><img src=\"https://static.tigerbbs.com/6f0ee7363c9fe8efde482515ffff79ac\" tg-width=\"1242\" tg-height=\"538\" referrerpolicy=\"no-referrer\">The turnaround from the Monday selloff shows “corporations have been very resilient through all this,”&nbsp;David Mazza, Direxion head of product, said on Bloomberg Television. “Earnings estimates are quite remarkable, probably some of the best on record. Even through all this, we have central-bank liquidity remaining very abundant, economic growth being robust.”</p>\n<p>Energy and mega-cap tech stocks gained ahead of a new batch of earnings reports, the latest initial claims data and the first ECB meeting to incorporate the bank's new strategic review.&nbsp;Energy stocks Chevron Corp, Exxon Mobil, Schlumberger NV, Occidental Petroleum and Marathon Petroleum Corp climbed between 0.1% and 1%, tracking crude prices.</p>\n<p>Some other notable pre-market movers:</p>\n<ul>\n <li>Didi Global (DIDI) drops 3% in&nbsp;premarket&nbsp;trading after people familiar with the matter said Chinese regulators are considering serious, perhaps unprecedented, penalties for for the ride-hailing giant after its controversial initial public offering last month.</li>\n <li>Texas Instruments (TXN) drops 4.8% after third-quarter sales and profit forecasts left analysts disappointed, with Barclays saying the “flat outlook leaves little to live for this late in the cycle.”</li>\n <li>AT&amp;T (T) added 0.9% as the telecom operator beat analysts’ estimates for monthly phone bill paying subscriber additions in the second quarter, fueled by more Americans converting to 5G phones.</li>\n <li>Dow (DOW) rose 1.3% after its second-quarter profit doubled from the first, as prices for its chemicals used in plastics and packaging rose on the back of strong consumer and industrial demand as well as lower inventories.</li>\n <li><a href=\"https://laohu8.com/S/CEMI\">Chembio Diagnostics</a> (CEMI) gains 9.9% and <a href=\"https://laohu8.com/S/NURO\">NeuroMetrix</a> (NURO) surges 33% amid discussions on message boards at Reddit and StockTwits.</li>\n</ul>\n<p>Elsewhere, the Labor Department’s report, due at 8:30 a.m. ET, is expected to show the number of Americans filing new claims for unemployment benefits fell to 350K (from 360K) for the week ended July 17, amid rampant worker shortages. Investors have been closely following the health of the jobs market on which monetary policy hinges, especially after a series of higher inflation reading recently sparked fears about a sooner-than expected paring of policy support as the economy reopens.</p>\n<p>Bitcoin briefly rose above $32,000 after getting a boost from Elon Musk, who said his space exploration company SpaceX owns the digital token.</p>\n<p>In commodities oil hung on to most of Wednesday's sharp price rise, its biggest one-day gain in three months. Brent crude futures were last 0.4% softer at $71.94 a barrel, but had gained more than 4% on Wednesday. Gold was steady at $1,801 an ounce and cryptocurrencies were firm after bouncing from lows when Tesla boss Elon Musk said the carmaker would likely restart accepting bitcoin payments after due diligence on its energy use.</p>\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{".SPX":"S&P 500 Index",".DJI":"道琼斯","SPY":"标普500ETF",".IXIC":"NASDAQ Composite"},"is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1127427732","content_text":"(Julr 22) Stock futures advanced on Thursday, with investors looking to earnings and data for impetus to extend a 2-day rally that wiped out losses sustained during the worst trading day of 2021.\nAt 7:54 a.m. ET, Dow E-minis were up 47 points, or 0.14%, S&P 500 E-minis were up 6.5 points, or 0.15% and Nasdaq 100 E-minis rose 28.75 points, or 0.19%. \nThe turnaround from the Monday selloff shows “corporations have been very resilient through all this,” David Mazza, Direxion head of product, said on Bloomberg Television. “Earnings estimates are quite remarkable, probably some of the best on record. Even through all this, we have central-bank liquidity remaining very abundant, economic growth being robust.”\nEnergy and mega-cap tech stocks gained ahead of a new batch of earnings reports, the latest initial claims data and the first ECB meeting to incorporate the bank's new strategic review. Energy stocks Chevron Corp, Exxon Mobil, Schlumberger NV, Occidental Petroleum and Marathon Petroleum Corp climbed between 0.1% and 1%, tracking crude prices.\nSome other notable pre-market movers:\n\nDidi Global (DIDI) drops 3% in premarket trading after people familiar with the matter said Chinese regulators are considering serious, perhaps unprecedented, penalties for for the ride-hailing giant after its controversial initial public offering last month.\nTexas Instruments (TXN) drops 4.8% after third-quarter sales and profit forecasts left analysts disappointed, with Barclays saying the “flat outlook leaves little to live for this late in the cycle.”\nAT&T (T) added 0.9% as the telecom operator beat analysts’ estimates for monthly phone bill paying subscriber additions in the second quarter, fueled by more Americans converting to 5G phones.\nDow (DOW) rose 1.3% after its second-quarter profit doubled from the first, as prices for its chemicals used in plastics and packaging rose on the back of strong consumer and industrial demand as well as lower inventories.\nChembio Diagnostics (CEMI) gains 9.9% and NeuroMetrix (NURO) surges 33% amid discussions on message boards at Reddit and StockTwits.\n\nElsewhere, the Labor Department’s report, due at 8:30 a.m. ET, is expected to show the number of Americans filing new claims for unemployment benefits fell to 350K (from 360K) for the week ended July 17, amid rampant worker shortages. Investors have been closely following the health of the jobs market on which monetary policy hinges, especially after a series of higher inflation reading recently sparked fears about a sooner-than expected paring of policy support as the economy reopens.\nBitcoin briefly rose above $32,000 after getting a boost from Elon Musk, who said his space exploration company SpaceX owns the digital token.\nIn commodities oil hung on to most of Wednesday's sharp price rise, its biggest one-day gain in three months. Brent crude futures were last 0.4% softer at $71.94 a barrel, but had gained more than 4% on Wednesday. Gold was steady at $1,801 an ounce and cryptocurrencies were firm after bouncing from lows when Tesla boss Elon Musk said the carmaker would likely restart accepting bitcoin payments after due diligence on its energy use.","news_type":1},"isVote":1,"tweetType":1,"viewCount":225,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":170730841,"gmtCreate":1626449928683,"gmtModify":1703760502487,"author":{"id":"4089431764587050","authorId":"4089431764587050","name":"ZHKNG","avatar":"https://static.tigerbbs.com/795ff17bd4982775f700470e7bd01266","crmLevel":2,"crmLevelSwitch":0,"followedFlag":false,"idStr":"4089431764587050","authorIdStr":"4089431764587050"},"themes":[],"htmlText":"Follow","listText":"Follow","text":"Follow","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/170730841","repostId":"1149577900","repostType":4,"repost":{"id":"1149577900","pubTimestamp":1626483617,"share":"https://ttm.financial/m/news/1149577900?lang=&edition=fundamental","pubTime":"2021-07-17 09:00","market":"us","language":"en","title":"Don't Fear A Stock Market Crash","url":"https://stock-news.laohu8.com/highlight/detail?id=1149577900","media":"seekingalpha","summary":"Summary\n\nWarnings and claims of a stock market crash keep surfacing as the markets continue to push ","content":"<p>Summary</p>\n<ul>\n <li>Warnings and claims of a stock market crash keep surfacing as the markets continue to push themselves to new records.</li>\n <li>There are four main factors that this market exhibits that have the potential to cause a crash.</li>\n <li>Those factors include excessive speculation, a growth slowdown, peak valuations, and low interest rates rising.</li>\n <li>Preparedness for the possible outcomes stemming from these factors and securing a portfolio against those outcomes could be necessary.</li>\n <li>A crash isn't something to fear, but rather something to take advantage of and capitalize from the bargains being offered.</li>\n</ul>\n<p>Warnings and claims of a stock market crash keep surfacing as the markets continue to push themselves to new records. First it was March, then May, then June, then September, for when experts would say the crash would come. Has it? No. Will it? Possibly. Is it easy to predict? Hardly. The more you hear people talk about it, the more you see it, the more convincing a possible crash gets - yet it's still nothing to fear. There are unfavorable and unsightly factors in the markets - again, it's still nothing to fear; rather, it's something to keep in mind, prepare for, and ultimately, take advantage of and capitalize. Just like in sports such as basketball and soccer, a great player plays both offense and defense very well, and likewise a great investor can play both the bull and bear runs in the market, and capitalize off of either. A crash should be nothing to fear, when the cards are stacked right and the hedges are placed, as it can offer chances to buy high-quality companies often at large discounts.</p>\n<p>An Abundance of 'Warnings'</p>\n<p>Simply doing a quick search on Google (GOOG) for \"stock market crash\" or \"stock market crash expert\" returns dozens upon dozens of results of arguments laying out the pending doom of the markets, the arguments behind why the crash is bound to happen, why the crash didn't happen when it was supposed to,etc.; while there are many different 'expert warnings' for such a crash, let's take a look at three different perspectives, from Harry Dent, Jeremy Grantham, and John Hussman.</p>\n<ul>\n <li>Harry Denthas warned of an 80% crash coming this fall (a bit on the extreme side it seems, compared to others), saying that \"stocks have no place in investors' portfolios.\" His track record includes calling Japan's 1989 bubble and the dot-com bubble, and Dent is seeing that while investors remain bullish in the longer-term, the economy's recovery isn't the same and \"not as good as it used to be.\" Back in March, he had said that the biggest crash would happen in June, but as we all can see, it did not.</li>\n <li>Jeremy Granthamsees that the 2020 Covid-induced crash was a mere blip in the run to the market peak, with the past year shoring up to be the \"classic finale to an 11-year bull market.\" Overvaluation across each market decile, farther than in 2000, while margin and debt peak, and high speculative trading support his warning. He also sees deflating asset prices, such as housing, causing pain as well, as bonds, stocks and real estate have all inflated together.</li>\n <li>John Hussmanhas warned that valuations are extreme, and called for the S&amp;P 500 to see 12 years of negative returns ahead and a &gt;60% decline; Hussman's track record includes calling out the dot-com bubble burst and 80% decline, the 2008 crash, and the decade of negative returns following the dot-com bubble. He also warns about speculation on securities that have already seen large appreciation for future growth. One of the key factors that he points out for a likely snapping of this bull run is that \"the mental image in anticipation of a post-pandemic recovery may be more pleasant than the actual recovery itself,\" such that the \"glowing optimism currently built into record valuation extremes could be followed by quite a bit of disappointment.\"</li>\n</ul>\n<p>Yet they aren't alone, and while track records do show some big crashes, often times they can be wrong far more than they are right, banks are also seeing minimal returns over the decade - Bank of America (BAC) is predicting that the S&amp;P 500 would return an average of just 2% through the decade given the valuation landscape. That, plus other factors, do bring up the possibility of a crash, but with the signs and signals flashing, it shouldn't catch anyone off guard.</p>\n<p>Four Factors</p>\n<p>While there are many factors that have caused prior crashes and could cause future ones, four main factors that this current market exhibits that have the potential to cause a crash include: high amounts of speculative trading, slowdown in growth (economic recovery), peak valuations, and low interest rates that rise.</p>\n<p>Excessive Speculation</p>\n<p>Speculation comes in many forms, but the most recognizable instances of over-exuberant trading and excessive speculation include GameStop's (GME) January short-squeeze frenzy, Archegos' implosion and the crash of Viacom (VIAC), Discovery (DISCA), a basket of Chinese tech stocks including Baidu (BIDU), iQIYI (IQ) and Vipshop(NYSE:VIPS), and others, and the more recent AMC Entertainment (AMC) short squeeze. Dogecoin (DOGE-USD) also erupted in a speculative half social-media, half Elon Musk-fueled run.</p>\n<p>While single asset speculation through heavy volume trading not just in shares but in call options has been visible, less visible aspects of excessive speculative have persisted for months, with some surfacing in February or earlier.</p>\n<p><img src=\"https://static.tigerbbs.com/dccc290398aed22a11cf41ae63a85bce\" tg-width=\"624\" tg-height=\"453\" referrerpolicy=\"no-referrer\"></p>\n<p>Margin debt (above) has risen significantly since 2020's bottoming out, up over 70% to over $850 billion from just $500 billion in early 2020. Robinhood (HOOD), a facilitator of first-time investors entering the market, of which they did in herds during 2020, provided relatively easy access to margin trading, and a flood of new investors and a surge in 'FOMO' helped push both margin debt and the market higher through 2020. While spikes in margin debt have historically preceded both the dot-com and housing bubble bursts (a pre-recessionary indicator), margin debt has spiked during the recent recession, which could signal that more pain is yet to come.</p>\n<p>Back in early February, signs of excess speculation and a push in the ten-year past 1.25%, to me, signaled pain ahead for growth stocks - thatthesisplayed out starting that day, with the NASDAQ falling over 10% through early March. Now, yields are stumbling, with the ten-year dropping below 1.30%, as expectations for a growth slowdown amid a slew of factors including new lockdowns in Australia, rising cases from the Delta variant and higher-than-expected inflation.</p>\n<p>Speculation combines with other factors, like a growth slowdown and peak valuations, to create frothiness in trading, stretched multiples, and asymmetric risk-reward profiles, creating more risk than reward often.</p>\n<p>Growth Slowdown</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/034a916ba93dac9b099409c5906bee37\" tg-width=\"631\" tg-height=\"563\" referrerpolicy=\"no-referrer\"><span>Graphic fromWeForumvia Statista</span></p>\n<p>The economic recovery as the globe worked through and emerged from lockdowns last year is visible, with a nearV-recoveryin GDP through the back half of 2020. China has seen aslowdownin its recovery, with more policy support expected; U.S. job numbers have missed expectations multiple times so far this year. There are still pockets of the economy that have failed to recovery as fast as expected, such as family-owned businesses/restaurants.</p>\n<p>Unemployment, GDP, and inflation all factor into forecasts for economic growth, and inflation is posing a larger risk than the other two currently. High inflation, high[er] unemployment, and an economic growth slowdown can create stagflation, such as what was witnessed in the 1970s.Fears of stagflationhave risen through June; while wage stagnation has been fought off by companies raising wages to meet downfalls caused by labor shortages, inflation is driving prices higher - theCPIrose quicker than expectations, reaching its highest level since August 2008, while thePPImirrored that move, helped by supply chain issues across nearly all industries. Companies like PepsiCo (PEP) and Conagra (CAG) are raising prices to combat adverse effects to their operating performances stemming from inflation.</p>\n<p>The market hasn't necessarily reacted to the possibilities of an economic slowdown, and inflation isn't the only factor - Covid-19 is not close to being gone, with the Delta variant surging in non-vaccinated communities and countries.Lockdownshave been re-implemented in parts of Australia, and there's no telling if lockdowns will be needed in other regions if cases continue to spike, and that alone can revert economic growth.</p>\n<p>Peak Valuations</p>\n<p>Arguably one of the most noticeable and most mentioned factor in this list is peak valuations - that is, stocks are in a bubble, or certain groups of stocks are substantially overvalued.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/388dd5417e610209de84d8a86ca86f91\" tg-width=\"624\" tg-height=\"351\" referrerpolicy=\"no-referrer\"><span>Graphic fromBloomberg</span></p>\n<p>February and March marked a time where the markets 'reset' valuations for growth stocks - in particular, SPACs and unprofitable high-growth stocks who soared during 2020 (Goldman Sachs'Non-Profitable Tech Indexreached 393.1 in January 2021, up from 81.7 in March 2020). The SPAC cohort is a mix of heavy speculation and peak valuations, with SPACs rising &gt;100% on rumors of mergers, only to fall &gt;50% following those mergers - Churchill Capital IV (CCIV) and Lucid Motors is the prime example of this. This was a trend of the EV sector in general from January through March, with leaders Tesla (TSLA) and NIO (NIO) shedding over one-third of their value.</p>\n<p>SPACs also mirror some of the exuberance in 2000 - stocks that had that dot-com in the name were able to raise substantial cash via IPOs without much of a proven operating record, and many failed. Many of the SPACs that have come public in the past year exhibit those same features - a high investor appetite, ability to raise necessary cash from such appetite, multi-billion dollar valuations, and minimal revenues. General IPOs are also red-hot, with hundreds of companies already joining the markets this year, as investor snap them up quickly.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/6a5ace269e2c48c6ad6bb5180ce32e48\" tg-width=\"635\" tg-height=\"535\" referrerpolicy=\"no-referrer\"><span>Data byYCharts</span></p>\n<p>Tech stocks that have performed poorly since that 'peak' from January through March include some of those recent IPOs like C3.ai (AI), Lemonade (LMND), Snowflake (SNOW), and others including Appian (APPN) and Fastly (FSLY); aside from Snowflake, which is down 20%, the rest have fallen over 40% from those highs as high P/S multiples reset. On the other hand, CrowdStrike (CRWD) and Zscaler (ZS) have managed to maintain such a high multiple with growing cybersecurity tailwinds, and have performed about flat over the same period. While the former six do still have strong, positive growth prospects, sustaining a high multiple is never guaranteed, and a reset that shocks the market shocks these stocks significantly, as seen in their performance.</p>\n<p>But these peak valuations also spread to the blue-chips, and to FAANGM - Facebook (FB), Apple (AAPL), Amazon (AMZN), Netflix (NFLX), Google (GOOGL), and Microsoft (MSFT). This basket's PE valuations, on a weighted-by-market-cap basis, sat at 45x earnings in February, pushed higher by Amazon and Apple; at the moment, it sits just above 41.5x. This plays a role in exaggerating the overall S&amp;P PE due to the heavy weighting the group has in the index, which is over 2 standard deviations above its average.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/136219a2e6ea016fd91597c989fa1a9e\" tg-width=\"624\" tg-height=\"312\" referrerpolicy=\"no-referrer\"><span>Graphic fromCurrent Market Valuation</span></p>\n<p>And as a whole, valuations across the market are becoming more stretched, with each decile seeing its most extreme valuations on a PS basis, topping that of 2000. While high-beta, high-multiple stocks (primarily tech) in decline 10 have exceeded their 2000s level in a steep climb, decile 8 and 9 (likely more stable stocks given historical PS of 2x-4x) have seen that ratio double since 2011, with a surge in 2020 taking the deciles far past averages. While the exact components that make up each decile are unknown, are the drivers in place to solidify such a rapid expansion since 2019? For some stocks, possibly, but for others, it's not as likely. It could be down to a combination of high levels of bullishness in the market, FOMO, stimulus and low rates allowing stocks to run higher even with less fundamental backing.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/d8ab71b923769effdde5d09e1d3cd3fd\" tg-width=\"624\" tg-height=\"354\" referrerpolicy=\"no-referrer\"><span>Graphic fromBusiness Insider</span></p>\n<p>Low Interest Rates</p>\n<p>The fourth factor here is low interest rates that begin to rise, which ultimately affect the flow/flood of money into the markets, of which the Fed has supported since 2020. Some experts are seeing that equities in general are exhibiting signs of peak valuations and irrational exuberance, but that can be sustained as long as 'stimulus' in the form of Fed support remains.</p>\n<p>When interest rates are kept lower for an extended period, it increases the chances of bubbles being formed in different asset classes. Thus, one of the biggest risks becomes inflation, the risk that the market is currently digesting.</p>\n<p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2e8cb16f3b4b962cfa8adbffa4127b92\" tg-width=\"960\" tg-height=\"720\" referrerpolicy=\"no-referrer\"><span>Graphic fromJP Morgan</span></p>\n<p>Although rates are still low as of right now, the Fed has been facing some different viewpoints as to when it will need to start raising rates to combat inflation. Some see rates as early asnext year,others see it remaining in 2023. A rise in interest rates can spark a crash by removing excess liquidity from the markets (removing the ease of access to liquidity). The Fed has reiterated its belief that inflation is stilltransitory, but a quarter-long spell of higher-than-expected inflation data (just like what has occurred this week with the CPI and PPI rising ahead of expectations), could definitely force a rethinking of rate hikes and shake the market.</p>\n<p>Is It Time To Prepare?</p>\n<p>Signs and signals of bubbly conditions are still here, and preparedness for the possible outcomes and securing a portfolio against those outcomes is a smart idea. All it takes is one catalyst to knock equities back from high valuations and back to lower levels; sings in bonds and the dollar are starting to show rising expectations of tapering and the eventual end of Fed asset-buying and support. While there are numerous experts warning of a crash, it can be nearly impossible to time, and while evidence many of them provide is sound, such claims of<i>x%</i>drops in<i>x</i>month are speculative in nature, unless that individual knows something unknown to the rest of the market.</p>\n<p>When facing a potential bubble or crash situation, hedging portfolios is key in minimizing losses and mitigating downside risk. Derivatives on index ETFs like&nbsp;SPY&nbsp;and&nbsp;DIA&nbsp;could offset potential selloffs in the market, while theQQQcan protect against losses in high-flying tech. For example, a quick case study for an SPY put play for Sept. 17: you assume an expectation for a 10% decline in the SPY to ~$390, and hedging your portfolio could come through a long put for ~$300, a $410/$390/$370 long butterfly for ~$100, or a $410/$390 put debit spread for ~$200. While the first trade has the highest return potential, it brings the highest risk, as the latter two strategies can start to profit on moves closer to -7%. For a $50,000 portfolio, a ~1% hedge could allow the purchase of 3 debit spreads, providing a maximum return of ~$6,000, or 12% of the portfolio value, which could effectively mitigate losses should the SPY fall to or below $390.<i>Note that options strategies are inherently risky, and each investor's risk appetite is different, and such a strategy may not be suitable for everyone. This is merely a case study and shows the potential that a small percentage hedge can have in mitigating downside risk. Be aware of risks to timing and theta decay, and options becoming worthless.</i></p>\n<p>Again, it's difficult to identify and even more difficult to time a bubble, given that the market can remain 'wrong' much longer than you can wait to be right. There's still room to run further with Fed support, but such signs of a potential bubble - excessive speculation, growth slowdown, peak valuations, and low interest rates rising - require awareness and preparedness. Yet it's nothing to fear. Small hedges can minimize downside risk, especially through options if timed well. Understanding the risks to high-flying growth stocks and those trading at or near peak valuations, regardless of sector, is important - many of the IPOs and SPACs have seen high valuations and minimal revenues, leading to exorbitant PS multiples pricing in years of growth, much like 2000. At the end of the day, if or when a crash happens, the opportunities to buy the 'best-of-the-best' companies at very attractive levels, and can provide generous returns.</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Don't Fear A Stock Market Crash</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nDon't Fear A Stock Market Crash\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-07-17 09:00 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4439512-dont-fear-a-stock-market-crash><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nWarnings and claims of a stock market crash keep surfacing as the markets continue to push themselves to new records.\nThere are four main factors that this market exhibits that have the ...</p>\n\n<a href=\"https://seekingalpha.com/article/4439512-dont-fear-a-stock-market-crash\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{".SPX":"S&P 500 Index",".IXIC":"NASDAQ Composite",".DJI":"道琼斯"},"source_url":"https://seekingalpha.com/article/4439512-dont-fear-a-stock-market-crash","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1149577900","content_text":"Summary\n\nWarnings and claims of a stock market crash keep surfacing as the markets continue to push themselves to new records.\nThere are four main factors that this market exhibits that have the potential to cause a crash.\nThose factors include excessive speculation, a growth slowdown, peak valuations, and low interest rates rising.\nPreparedness for the possible outcomes stemming from these factors and securing a portfolio against those outcomes could be necessary.\nA crash isn't something to fear, but rather something to take advantage of and capitalize from the bargains being offered.\n\nWarnings and claims of a stock market crash keep surfacing as the markets continue to push themselves to new records. First it was March, then May, then June, then September, for when experts would say the crash would come. Has it? No. Will it? Possibly. Is it easy to predict? Hardly. The more you hear people talk about it, the more you see it, the more convincing a possible crash gets - yet it's still nothing to fear. There are unfavorable and unsightly factors in the markets - again, it's still nothing to fear; rather, it's something to keep in mind, prepare for, and ultimately, take advantage of and capitalize. Just like in sports such as basketball and soccer, a great player plays both offense and defense very well, and likewise a great investor can play both the bull and bear runs in the market, and capitalize off of either. A crash should be nothing to fear, when the cards are stacked right and the hedges are placed, as it can offer chances to buy high-quality companies often at large discounts.\nAn Abundance of 'Warnings'\nSimply doing a quick search on Google (GOOG) for \"stock market crash\" or \"stock market crash expert\" returns dozens upon dozens of results of arguments laying out the pending doom of the markets, the arguments behind why the crash is bound to happen, why the crash didn't happen when it was supposed to,etc.; while there are many different 'expert warnings' for such a crash, let's take a look at three different perspectives, from Harry Dent, Jeremy Grantham, and John Hussman.\n\nHarry Denthas warned of an 80% crash coming this fall (a bit on the extreme side it seems, compared to others), saying that \"stocks have no place in investors' portfolios.\" His track record includes calling Japan's 1989 bubble and the dot-com bubble, and Dent is seeing that while investors remain bullish in the longer-term, the economy's recovery isn't the same and \"not as good as it used to be.\" Back in March, he had said that the biggest crash would happen in June, but as we all can see, it did not.\nJeremy Granthamsees that the 2020 Covid-induced crash was a mere blip in the run to the market peak, with the past year shoring up to be the \"classic finale to an 11-year bull market.\" Overvaluation across each market decile, farther than in 2000, while margin and debt peak, and high speculative trading support his warning. He also sees deflating asset prices, such as housing, causing pain as well, as bonds, stocks and real estate have all inflated together.\nJohn Hussmanhas warned that valuations are extreme, and called for the S&P 500 to see 12 years of negative returns ahead and a >60% decline; Hussman's track record includes calling out the dot-com bubble burst and 80% decline, the 2008 crash, and the decade of negative returns following the dot-com bubble. He also warns about speculation on securities that have already seen large appreciation for future growth. One of the key factors that he points out for a likely snapping of this bull run is that \"the mental image in anticipation of a post-pandemic recovery may be more pleasant than the actual recovery itself,\" such that the \"glowing optimism currently built into record valuation extremes could be followed by quite a bit of disappointment.\"\n\nYet they aren't alone, and while track records do show some big crashes, often times they can be wrong far more than they are right, banks are also seeing minimal returns over the decade - Bank of America (BAC) is predicting that the S&P 500 would return an average of just 2% through the decade given the valuation landscape. That, plus other factors, do bring up the possibility of a crash, but with the signs and signals flashing, it shouldn't catch anyone off guard.\nFour Factors\nWhile there are many factors that have caused prior crashes and could cause future ones, four main factors that this current market exhibits that have the potential to cause a crash include: high amounts of speculative trading, slowdown in growth (economic recovery), peak valuations, and low interest rates that rise.\nExcessive Speculation\nSpeculation comes in many forms, but the most recognizable instances of over-exuberant trading and excessive speculation include GameStop's (GME) January short-squeeze frenzy, Archegos' implosion and the crash of Viacom (VIAC), Discovery (DISCA), a basket of Chinese tech stocks including Baidu (BIDU), iQIYI (IQ) and Vipshop(NYSE:VIPS), and others, and the more recent AMC Entertainment (AMC) short squeeze. Dogecoin (DOGE-USD) also erupted in a speculative half social-media, half Elon Musk-fueled run.\nWhile single asset speculation through heavy volume trading not just in shares but in call options has been visible, less visible aspects of excessive speculative have persisted for months, with some surfacing in February or earlier.\n\nMargin debt (above) has risen significantly since 2020's bottoming out, up over 70% to over $850 billion from just $500 billion in early 2020. Robinhood (HOOD), a facilitator of first-time investors entering the market, of which they did in herds during 2020, provided relatively easy access to margin trading, and a flood of new investors and a surge in 'FOMO' helped push both margin debt and the market higher through 2020. While spikes in margin debt have historically preceded both the dot-com and housing bubble bursts (a pre-recessionary indicator), margin debt has spiked during the recent recession, which could signal that more pain is yet to come.\nBack in early February, signs of excess speculation and a push in the ten-year past 1.25%, to me, signaled pain ahead for growth stocks - thatthesisplayed out starting that day, with the NASDAQ falling over 10% through early March. Now, yields are stumbling, with the ten-year dropping below 1.30%, as expectations for a growth slowdown amid a slew of factors including new lockdowns in Australia, rising cases from the Delta variant and higher-than-expected inflation.\nSpeculation combines with other factors, like a growth slowdown and peak valuations, to create frothiness in trading, stretched multiples, and asymmetric risk-reward profiles, creating more risk than reward often.\nGrowth Slowdown\nGraphic fromWeForumvia Statista\nThe economic recovery as the globe worked through and emerged from lockdowns last year is visible, with a nearV-recoveryin GDP through the back half of 2020. China has seen aslowdownin its recovery, with more policy support expected; U.S. job numbers have missed expectations multiple times so far this year. There are still pockets of the economy that have failed to recovery as fast as expected, such as family-owned businesses/restaurants.\nUnemployment, GDP, and inflation all factor into forecasts for economic growth, and inflation is posing a larger risk than the other two currently. High inflation, high[er] unemployment, and an economic growth slowdown can create stagflation, such as what was witnessed in the 1970s.Fears of stagflationhave risen through June; while wage stagnation has been fought off by companies raising wages to meet downfalls caused by labor shortages, inflation is driving prices higher - theCPIrose quicker than expectations, reaching its highest level since August 2008, while thePPImirrored that move, helped by supply chain issues across nearly all industries. Companies like PepsiCo (PEP) and Conagra (CAG) are raising prices to combat adverse effects to their operating performances stemming from inflation.\nThe market hasn't necessarily reacted to the possibilities of an economic slowdown, and inflation isn't the only factor - Covid-19 is not close to being gone, with the Delta variant surging in non-vaccinated communities and countries.Lockdownshave been re-implemented in parts of Australia, and there's no telling if lockdowns will be needed in other regions if cases continue to spike, and that alone can revert economic growth.\nPeak Valuations\nArguably one of the most noticeable and most mentioned factor in this list is peak valuations - that is, stocks are in a bubble, or certain groups of stocks are substantially overvalued.\nGraphic fromBloomberg\nFebruary and March marked a time where the markets 'reset' valuations for growth stocks - in particular, SPACs and unprofitable high-growth stocks who soared during 2020 (Goldman Sachs'Non-Profitable Tech Indexreached 393.1 in January 2021, up from 81.7 in March 2020). The SPAC cohort is a mix of heavy speculation and peak valuations, with SPACs rising >100% on rumors of mergers, only to fall >50% following those mergers - Churchill Capital IV (CCIV) and Lucid Motors is the prime example of this. This was a trend of the EV sector in general from January through March, with leaders Tesla (TSLA) and NIO (NIO) shedding over one-third of their value.\nSPACs also mirror some of the exuberance in 2000 - stocks that had that dot-com in the name were able to raise substantial cash via IPOs without much of a proven operating record, and many failed. Many of the SPACs that have come public in the past year exhibit those same features - a high investor appetite, ability to raise necessary cash from such appetite, multi-billion dollar valuations, and minimal revenues. General IPOs are also red-hot, with hundreds of companies already joining the markets this year, as investor snap them up quickly.\nData byYCharts\nTech stocks that have performed poorly since that 'peak' from January through March include some of those recent IPOs like C3.ai (AI), Lemonade (LMND), Snowflake (SNOW), and others including Appian (APPN) and Fastly (FSLY); aside from Snowflake, which is down 20%, the rest have fallen over 40% from those highs as high P/S multiples reset. On the other hand, CrowdStrike (CRWD) and Zscaler (ZS) have managed to maintain such a high multiple with growing cybersecurity tailwinds, and have performed about flat over the same period. While the former six do still have strong, positive growth prospects, sustaining a high multiple is never guaranteed, and a reset that shocks the market shocks these stocks significantly, as seen in their performance.\nBut these peak valuations also spread to the blue-chips, and to FAANGM - Facebook (FB), Apple (AAPL), Amazon (AMZN), Netflix (NFLX), Google (GOOGL), and Microsoft (MSFT). This basket's PE valuations, on a weighted-by-market-cap basis, sat at 45x earnings in February, pushed higher by Amazon and Apple; at the moment, it sits just above 41.5x. This plays a role in exaggerating the overall S&P PE due to the heavy weighting the group has in the index, which is over 2 standard deviations above its average.\nGraphic fromCurrent Market Valuation\nAnd as a whole, valuations across the market are becoming more stretched, with each decile seeing its most extreme valuations on a PS basis, topping that of 2000. While high-beta, high-multiple stocks (primarily tech) in decline 10 have exceeded their 2000s level in a steep climb, decile 8 and 9 (likely more stable stocks given historical PS of 2x-4x) have seen that ratio double since 2011, with a surge in 2020 taking the deciles far past averages. While the exact components that make up each decile are unknown, are the drivers in place to solidify such a rapid expansion since 2019? For some stocks, possibly, but for others, it's not as likely. It could be down to a combination of high levels of bullishness in the market, FOMO, stimulus and low rates allowing stocks to run higher even with less fundamental backing.\nGraphic fromBusiness Insider\nLow Interest Rates\nThe fourth factor here is low interest rates that begin to rise, which ultimately affect the flow/flood of money into the markets, of which the Fed has supported since 2020. Some experts are seeing that equities in general are exhibiting signs of peak valuations and irrational exuberance, but that can be sustained as long as 'stimulus' in the form of Fed support remains.\nWhen interest rates are kept lower for an extended period, it increases the chances of bubbles being formed in different asset classes. Thus, one of the biggest risks becomes inflation, the risk that the market is currently digesting.\nGraphic fromJP Morgan\nAlthough rates are still low as of right now, the Fed has been facing some different viewpoints as to when it will need to start raising rates to combat inflation. Some see rates as early asnext year,others see it remaining in 2023. A rise in interest rates can spark a crash by removing excess liquidity from the markets (removing the ease of access to liquidity). The Fed has reiterated its belief that inflation is stilltransitory, but a quarter-long spell of higher-than-expected inflation data (just like what has occurred this week with the CPI and PPI rising ahead of expectations), could definitely force a rethinking of rate hikes and shake the market.\nIs It Time To Prepare?\nSigns and signals of bubbly conditions are still here, and preparedness for the possible outcomes and securing a portfolio against those outcomes is a smart idea. All it takes is one catalyst to knock equities back from high valuations and back to lower levels; sings in bonds and the dollar are starting to show rising expectations of tapering and the eventual end of Fed asset-buying and support. While there are numerous experts warning of a crash, it can be nearly impossible to time, and while evidence many of them provide is sound, such claims ofx%drops inxmonth are speculative in nature, unless that individual knows something unknown to the rest of the market.\nWhen facing a potential bubble or crash situation, hedging portfolios is key in minimizing losses and mitigating downside risk. Derivatives on index ETFs like SPY and DIA could offset potential selloffs in the market, while theQQQcan protect against losses in high-flying tech. For example, a quick case study for an SPY put play for Sept. 17: you assume an expectation for a 10% decline in the SPY to ~$390, and hedging your portfolio could come through a long put for ~$300, a $410/$390/$370 long butterfly for ~$100, or a $410/$390 put debit spread for ~$200. While the first trade has the highest return potential, it brings the highest risk, as the latter two strategies can start to profit on moves closer to -7%. For a $50,000 portfolio, a ~1% hedge could allow the purchase of 3 debit spreads, providing a maximum return of ~$6,000, or 12% of the portfolio value, which could effectively mitigate losses should the SPY fall to or below $390.Note that options strategies are inherently risky, and each investor's risk appetite is different, and such a strategy may not be suitable for everyone. This is merely a case study and shows the potential that a small percentage hedge can have in mitigating downside risk. Be aware of risks to timing and theta decay, and options becoming worthless.\nAgain, it's difficult to identify and even more difficult to time a bubble, given that the market can remain 'wrong' much longer than you can wait to be right. There's still room to run further with Fed support, but such signs of a potential bubble - excessive speculation, growth slowdown, peak valuations, and low interest rates rising - require awareness and preparedness. Yet it's nothing to fear. Small hedges can minimize downside risk, especially through options if timed well. Understanding the risks to high-flying growth stocks and those trading at or near peak valuations, regardless of sector, is important - many of the IPOs and SPACs have seen high valuations and minimal revenues, leading to exorbitant PS multiples pricing in years of growth, much like 2000. At the end of the day, if or when a crash happens, the opportunities to buy the 'best-of-the-best' companies at very attractive levels, and can provide generous returns.","news_type":1},"isVote":1,"tweetType":1,"viewCount":186,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":170803152,"gmtCreate":1626416731376,"gmtModify":1703759756817,"author":{"id":"4089431764587050","authorId":"4089431764587050","name":"ZHKNG","avatar":"https://static.tigerbbs.com/795ff17bd4982775f700470e7bd01266","crmLevel":2,"crmLevelSwitch":0,"followedFlag":false,"idStr":"4089431764587050","authorIdStr":"4089431764587050"},"themes":[],"htmlText":"Cash is king","listText":"Cash is king","text":"Cash is king","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/170803152","repostId":"1188033080","repostType":4,"repost":{"id":"1188033080","pubTimestamp":1626415294,"share":"https://ttm.financial/m/news/1188033080?lang=&edition=fundamental","pubTime":"2021-07-16 14:01","market":"us","language":"en","title":"Square: Cash App Is A Can't-Miss Opportunity","url":"https://stock-news.laohu8.com/highlight/detail?id=1188033080","media":"seekingalpha","summary":"Summary\n\nIn this article, I analyze Cash App's viral growth and how Square will evolve and monetize ","content":"<p><b>Summary</b></p>\n<ul>\n <li>In this article, I analyze Cash App's viral growth and how Square will evolve and monetize the App's ecosystem, the same way that Square evolved its Seller ecosystem.</li>\n <li>Cash App has 36 million monthly active users, which is up 140% since 2018, and it generated $529 million in the first quarter of 2021 (excluding Bitcoin).</li>\n <li>Square recently acquired Tidal, a music streaming platform. I will highlight how Cash App can leverage Tidal to create a platform to better empowers musicians to participate in the economy.</li>\n <li>According to my estimates, Cash App is worth $73.5 billion today, which is currently ~65% of Square's current market cap.</li>\n <li>I'm bullish on Square and the ecosystem that it's creating within Cash App.</li>\n</ul>\n<p>Investment Thesis</p>\n<p>Cash App from Square(NYSE:SQ)is due for a large expansion in its offerings, similar to how the Seller ecosystem evolved over the last 10 years. The average bank generates about$880in revenue per active digital customer, while Cash App only generated$41per active user to end 2020. In order for Square to monetize Cash App, it must continue to build its platform and expand its services by attracting new users and offering new products.</p>\n<p>Square will achieve this by extending economic empowerment to individuals just as its Seller ecosystem extended its customer’s business capabilities. Square recentlyacquired Tidal, Jay-Z’s artist-backed music streaming service. This is an opportunity for Cash App to work for individuals, specifically musicians.</p>\n<blockquote>\n Given what Square has been able to do for sellers of all sizes and individuals through Cash App, we believe we can now work for artists to see the same success for them, and us. We’re going to start small and focus on the most critical needs of artists and growing their fan bases.-Jack Dorsey, Square CEO\n</blockquote>\n<p>In this article, I will highlight the opportunity Square has to expand Cash App’s ecosystem to empower individuals to better participate in the economy, specifically illustrating how its recent Tidal acquisition could pay off.</p>\n<p>This is how Cash App operates under Square according toCash App's website,</p>\n<blockquote>\n Cash App is redefining the world’s relationship with money by making it more relatable, instantly available and universally accessible.\"\n</blockquote>\n<p>This mission will result in a huge increase in Cash App’s average revenue per user, making Square a buy for long-term investors today.</p>\n<p><b>Square Recap</b></p>\n<p>Since Square was founded by Jack Dorsey in 2009, the company’s core mission has remained the same: \"To empower businesses, sellers, and individuals toparticipate in the economy.\"Square carries out this mission through its Sellers ecosystem and Cash App.</p>\n<p>Sellers ecosystem: It enables businesses to use their computers or mobile devices as a payment or point-of-sale solution for business transactions. Square has taken the Sellers ecosystem a step further by utilizing its customers’ data so they can better engage their customers and now Square Capitaloffers loansfor small businesses. This ecosystem is starting to mature and is scalable.</p>\n<p>CashApp: Offers a platform for individuals to spend, send, or receive money as well as invest in stocks or bitcoin. Cash App includes Square’s Cash Card which operates like a debit card for one’s Cash App and offers “boosts,” which allow its cash card customers to save money at different restaurants or merchants.</p>\n<p><img src=\"https://static.tigerbbs.com/268d4a4adac2830ab266aeeb4ab31624\" tg-width=\"1280\" tg-height=\"650\" referrerpolicy=\"no-referrer\"></p>\n<p>Source:Square September 2020 Investor Presentation</p>\n<p>As can be seen above, Square expanded its Sellers ecosystem by adding product offerings for its customers, while it's capitalizing on these opportunities by becoming an industrial bank. Now, when Square Capital provides a loan to a customer, the loan can be issued fromSquare’s bank. This is a win for Square because it provides the loan for its customers’ business to operate, so it’s making money off the loan as well as the sales its customers generate using Square’s point-of-sale.</p>\n<p>Progression of Cash App</p>\n<p><img src=\"https://static.tigerbbs.com/44c3376c59fbc317eea20722102aacc7\" tg-width=\"1162\" tg-height=\"1014\" referrerpolicy=\"no-referrer\"></p>\n<p>Source:www.wokfofharcourtstreet.com</p>\n<ul>\n <li>Cash App entered 2021 with 36 million monthly active users and over100 milliondownloads</li>\n <li>Cash App delivered a strong Q1 of 2021 generating$529 million, up 139% year-over-year (excluding bitcoin revenue)</li>\n <li>Gross profits for Cash App were$420.5 millionin Q1, equivalent to a 79.5% gross profit margin (excluding bitcoin)</li>\n</ul>\n<p>Cash App is crushing it and a large part of its success is the culture that’s implemented by Square in order to grow Cash App’s monthly active users. Cash App has an extremely low average customer acquisition cost of less than$5. Cash App accomplished this by partnering with celebrities, specifically music artists, to offer promotions and cash giveaways using Twitter and other social media sites (Instagram and Tik-Tok specifically). By doing this, celebrities expose their fans and followers to Cash App, and in turn, this triggers a network effect. The artists get more attention and positive publicity, while so does Cash App. For example, when Kim Kardashian announced on Twitter she’d give away $500,000 through Cash App, it resulted in Cash App reaching a lot of Twitter accounts. Cash App reaches at least50,000 uniqueTwitter users per Cash App post, similar to these below.</p>\n<p><img src=\"https://static.tigerbbs.com/b95e01939e87e5df4423f20ae4e798e0\" tg-width=\"1280\" tg-height=\"530\"></p>\n<p>Source:www.bettermarketing.pub</p>\n<p>Cash App achieved viral growth cost effectively and is building its user base, but Cash App’s services are what leads to retaining and monetizing its user base. Some services we’ve seen thus far are investing in stocks and Bitcoin while Square has not lost sight of other opportunities as Cash App envisions further enabling its users.</p>\n<p><img src=\"https://static.tigerbbs.com/89d743061b76f93ea003da8155a86962\" tg-width=\"1280\" tg-height=\"581\" referrerpolicy=\"no-referrer\"></p>\n<p>Source: Square September 2020 Investors Presentation</p>\n<p>Now that we understand Cash App’s business model and why it works, let us explore how Tidal fits in with Cash App’s mission. Ultimately, this will create a platform for musicians to operate as independent, small businesses.</p>\n<p><b>Tidal + Cash App</b></p>\n<p>On March 4, 2021, Squareacquired Tidalfor $297 million, only 4.2% of Square’s cash on its balance sheet. Tidal is unique because it strives to create afair playing fieldfor its artists and is backed by artist-owners. These artists will retain a certain level of ownership in Tidal moving forward.</p>\n<p>These are some of Tidal’sartist-owners:</p>\n<ul>\n <li>Alicia Keys</li>\n <li>Beyoncé</li>\n <li>Calvin Harris</li>\n <li>Coldplay's Chris Martin</li>\n <li>Daft Punk</li>\n <li>Jack White</li>\n <li>Jason Aldean</li>\n <li>Shawn \"JAY-Z\" Carter</li>\n <li>Kanye West</li>\n <li>Lil Wayne</li>\n <li>Madonna</li>\n <li>Rihanna</li>\n</ul>\n<p>With these high-profile names and Jay-Z at the helm, Tidal got a lot of buzz but didn’t survive in a crowded streaming market. With these artists on board, Square is building its army and could use these artists to promote Cash App to continue to achieve a network effect. However, Jack Dorsey is rather focused on ensuring that musicians can better participate in the economy.</p>\n<p><img src=\"https://static.tigerbbs.com/75ae975c922fd634dadee20d290d23a0\" tg-width=\"1116\" tg-height=\"284\"></p>\n<p>Source:twitter.com</p>\n<p>In the same Twitter thread, Dorsey acknowledges plans for Square to “start small” by focusing on the most critical needs for musicians and by growing their fan bases. Square will achieve this by creating new listening experiences for fans, simpleintegration of merchandise sales, as well as new revenue streams for musicians.</p>\n<p>Streaming changed the way people consume their music as the premier services offer platforms for consumers to listen to all their favorite artists for an affordable monthly price (about $10 per month for the top services). These services were put in place to combat music piracy, as the price of a CD or songwent to $0for people who knew how to use peer-to-peer file-sharing. Even though streaming sites were intended to level the playing field for musicians, it resulted in musicians being paid less for their music.</p>\n<p>Top paying streaming services pay out about$4 per 1,000 song streams, making it difficult for musicians (especially smaller, up-and-coming musicians) to make a living off their music. This forced musicians to turn to other opportunities to counteract the lack of revenue from their songs, specifically by selling merchandise. The global music merchandise market was worth$3.5 billionin 2018, a 13.4% CAGR over the prior three years, and Square believes it can further empower these artists.</p>\n<ul>\n <li><p>Merchandise Opportunity - by leveraging Tidal’s streaming service (the musicians and Tidal subscribers) with Cash App, Square could offer the ideal place for musicians to sell their merchandise (ie. creating a Shopify for musicians to monetize their merchandise, their brand, or even special experiences). Square can facilitate sales between musicians and Cash App users, while this strategy engages and monetizes the current Cash App users, it will surely attract more new users to Cash App.</p></li>\n</ul>\n<p>If Square brings this idea to fruition, it would benefit both musicians and increase Cash App’s revenue stream. Currently, Square charges a2.95%fee when one of its Sellers accepts a transaction, but Square only keeps $0.50 or 1% of the purchase value as the rest goes to middlemen, the banks, and third parties. If Square creates a commerce platform for Tidal musicians to sell merchandise using Cash App, the artists could be paid directly, without middlemen, while Square could continue to charge a 2.95% fee for facilitating transactions, or could lower the fee to 1% to incentivize Cash App growth. Either way, it’s a win-win for musicians and Square:</p>\n<ul>\n <li>Musicians: Can directly sell to their fan bases, while directly receiving the funds.</li>\n <li>Square: Grows Cash App by expanding the opportunity individuals have to spend their money while increasing its take rate.</li>\n</ul>\n<p>Given the size of the global music merchandise market, $3.5 billion in 2018, and 13% growth over the previous three years, this is an ideal market for Square to unlock to see if it can empower individuals. Cash App grows virally by utilizing musicians to reach more people on social media, so this could be a natural path for Cash App to grow its user base while helping musicians reach current Cash App users. This also brings economic empowerment to musicians because Square will expand their revenue streams by letting the musicians sell directly to their fans.</p>\n<p>**Assumptions: Square keeps its take rate at 2.95%</p>\n<p>**The music merchandise industry grows 8% annually through 2030</p>\n<p>The model above is a conservative projection based on Square creating a platform for Tidal and Cash App to disrupt the merchandise market for musicians. If Square achieves this, Square will continue to create a network effect by drawing musicians to the platform to sell, while it also brings monetization and more users to Cash App. This results in a network effect, hence why I assumed that Square’s market share will increase over time. As Cash App’s users are expected to increase, the data in this model may be too conservative, if musicians really flocked to Tidal + Cash App to distribute content or merchandise.</p>\n<p>The column on the right is revenue just from merchandise sold by musicians, it doesn’t consider that as there are more users on Cash App, Square can monetize those users through the solutions it's already established such as peer-to-peer transactions or investing in stocks or bitcoin.</p>\n<p><b>Long-Term Agenda: Redefine How People Use Money</b></p>\n<p>This is just touching the surface of how Square is growing Cash App but there are other use-cases for combining Tidal and Cash App, as well as opportunities for other types of creators and artists. I'm going to list a few below to highlight the early stages we are in, but rather shine light on the endless possibilities, as we're in a time of technological innovation and blockchain is still in its infancy.</p>\n<p><img src=\"https://static.tigerbbs.com/8f53b32f2161c803a402a1cf41302026\" tg-width=\"1280\" tg-height=\"462\" referrerpolicy=\"no-referrer\"></p>\n<p>Source: Square September 2020 Investors Presentation</p>\n<ul>\n <li><p>Concert by Tidal: In 2012, Jay-Z founded Made in America, a huge annual music festival that is held in Philadelphia and is meant to bring together music and culture. The event is produced by Live Nation, (Jay-Z’s production company Rock Nation operates under them) and attracted more than100,000 peopleover the two-day festival in 2019 with 60 artists performing. In its first year, in 2012, the concert grossed$5 millionin ticket sales with 80,000 attendees. If Tidal and Cash App teamed to host an annual concert, it could be another way for Square to partner with musicians so they can be compensated fairly for performing (so they don’t have to deal with all the middlemen and fees), while pushing ticket sales through Cash App. Either way, this could be a big opportunity for Cash App to gain more exposure and users while promoting Tidal and its musicians.</p></li>\n <li><p>NFT’s for Artists: Non-fungible tokens are units of stored data that certify a digital asset to be unique; such as a photo, video, song, album, or any other digital file. This opportunity is unique because it gives the creator of the content control full control of the content, so there's no third party for a content creator to go through in order for them to sell and monetize their content. The creator is in control of the token and controls the licensing for the file while being able to monitor the transactions that take place on the network.</p></li>\n</ul>\n<p>NFT sales reached$2.5 billionin the first half of 2021 and artists are doing more and more regarding music sales using NFTs. For example, Kings of Leon recently released their new album as an NFT and generated$2 millionin sales. Kings of Leon dropped three different tokens for the launch: one being the special album package, the second token offers unique perks like gettingfront-row seats for lifeat Kings of Leon concerts, and the third is for exclusive visual art. This is clearly unique and innovative as it gives the artist a way to grasp their followers while engaging with fans in new ways.</p>\n<ul>\n <li><p>Opportunity for artists to get funding: For up-and-coming musicians who don't have access to funding, NFTs could be a way for them to access funds. For example, you can create an NFT for an upcoming album or song, and then sell the NFT to raise capital. In exchange, the buyers of the NFT will have some ownership of the upcoming project and receive royalties if the project gets licensed and played.</p></li>\n</ul>\n<p>This is in Square’s space because this will extend artists' capabilities to raise funds for their projects, in turn, the holders of the NFT can have “equity” and invest in their favorite artists.</p>\n<ul>\n <li><p>Content Creators: The digital content creation market is expected to grow 12% annually through 2030 to reach$38.2 billion. If Square successfully creates a platform to empower musicians, I believe that Square could scale to bring those same solutions to any type of artist or content creator. Square’s goal is to achieve economic empowerment for everyone, and by extending its platform to all content creators to monetize their brand and digital assets, it could change the way fans support their favorite content creators. If Square unlocks this market, it would result in a huge jump in Cash App’s revenue because Square is building the network, through Cash App, for artists to directly reach and sell. Cash App's large user base may incentivize artists using this platform to gain exposure.</p></li>\n</ul>\n<p>One area that I think this could be unique is for collegiate athletes. Now that college athletes can be paid based on theirname, image, or likeliness(NIL), Cash App could be a medium for athletes to engage fans or their community and be paid. It only became legal for student athletes to be compensated for their NIL, but this could be an area Square looks to help, as empowering individuals to participate in the economy is Square’s focus.</p>\n<p><b>Future Revenue Projections</b></p>\n<table>\n <tbody>\n  <tr>\n   <td><p>Year</p></td>\n   <td><p>ARPU</p></td>\n   <td><p>Active Users (in millions)</p></td>\n   <td><p>Revenue ($ in billions)</p></td>\n  </tr>\n  <tr>\n   <td><p>2021</p></td>\n   <td><p>$41</p></td>\n   <td><p>36</p></td>\n   <td><p>$ 1.476</p></td>\n  </tr>\n  <tr>\n   <td><p>2026</p></td>\n   <td><p>$150</p></td>\n   <td><p>70</p></td>\n   <td><p><b>$ 10.5</b></p></td>\n  </tr>\n </tbody>\n</table>\n<p>The estimates for 2026 are my opinion of how Square capitalizes on the viral growth of Cash App through monetization. Cash App's future active users is a conservative estimate of how I think Cash App will grow by 2026 as its monthly active users have increased by 140% since 2018. In 2017, Cash App generated $15 per user while it had only 7 million monthly active users, yet in 2021, Cash App has 36 million users and generates over double the ARPU it did in 2017. Hence, why I think the $150 ARPU is realistic by 2026, as I’ve highlighted that Cash App has long-term plans for changing the way that people interact with money.</p>\n<p>Using Cash App’s first quarter revenue ($529M) and using a 35% free cash flow margin to determine Cash App’s free cash flow today, Cash App generates $1.48 in free cash flow per share.</p>\n<p>Here’s the value of Cash App on a stand-alone basis (excluding Bitcoin revenue).</p>\n<p><img src=\"https://static.tigerbbs.com/e7f81ef5b5c6092c50334b2916dfcac7\" tg-width=\"730\" tg-height=\"574\" referrerpolicy=\"no-referrer\"></p>\n<p>Source: L.A. Stevens Valuation Model</p>\n<p>Cash App is worth ~$146 today while Square is trading around $245. For Cash App’s free cash flow margin, 35% is conservative as Cash App sports 80% gross profit margins, while 30% annualized free cash flow growth is attainable because Cash App’s annual revenue increased by137% in 2020 and 139% year-over-year in Q1 of 2021.</p>\n<p>Cash App makes up 65% of Squares market cap today, as Cash App is worth 73.5 billion in market cap based on its present value. With Square’s market cap of $110 billion, the stock is still in buy territory as growth in the Cash App ecosystem may not be reflected where the stock’s trading today.</p>\n<p><b>Conclusion</b></p>\n<p>Cash App’s growth since 2017 is remarkable, considering that it went from 3 million users at the end of 2016 to over 36 million monthly active users today. Square is in a great position today to cash in on Cash App’s strong foundation by taking it to the next step - by building its ecosystem and becoming a platform for commerce and specifically for individuals. Over the coming years, we will see how Square incorporates more services to provide value to both individual sellers or buyers, but Square has a long-term mindset to disrupt people’s relationship with money.</p>\n<p>Here is a quote from the head of Cash App, Brian Grassadonia, from Square’s lastkeynote presentation.</p>\n<blockquote>\n I think Apple has done this (redefining an industry) when we think about our relationship with technology, pre, and post-Apple. I think Google has done this when we think about our relationship with information, pre, and post-Google. And when I talk about redefining the world's relationship with money, I'm talking about redefining the world's relationship with money with similar breadth and scope that those organizations have redefined the world's relationship with their industries. That is a very, very big - you kind of can't even imagine what that means, right, when you're kind of sitting in it. You only really kind of identify that once you've already done it.”\n</blockquote>\n<p>To wrap up, Square is going to be one of the most disruptive companies of this generation. With superior leadership, specifically with Brian Grassadonia as head of Cash App and Jack Dorsey as CEO of Square, the company remains fixated on the long-term growth prospects that its original two ecosystems can leverage to further economically empower individuals. We will see how Square ultimately plans to leverage its Tidal acquisition, but there are plenty of opportunities for Square to connect musicians to consumers, as I’ve highlighted.</p>\n<p>At Beating The Market, we've been long on Square since it was trading around $80 a year ago, when we first analyzed Cash App's growth, feel free to check out this notehere. As Cash App remains in growth mode today, Square’s stock is still a buy trading below $250 for those looking to buy and hold for the long-term.</p>\n<p>Thanks for reading and happy investing!</p>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Square: Cash App Is A Can't-Miss Opportunity</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nSquare: Cash App Is A Can't-Miss Opportunity\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-07-16 14:01 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4439368-square-cash-app-is-a-cant-miss-opportunity><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Summary\n\nIn this article, I analyze Cash App's viral growth and how Square will evolve and monetize the App's ecosystem, the same way that Square evolved its Seller ecosystem.\nCash App has 36 million ...</p>\n\n<a href=\"https://seekingalpha.com/article/4439368-square-cash-app-is-a-cant-miss-opportunity\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"SQ":"Block"},"source_url":"https://seekingalpha.com/article/4439368-square-cash-app-is-a-cant-miss-opportunity","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"1188033080","content_text":"Summary\n\nIn this article, I analyze Cash App's viral growth and how Square will evolve and monetize the App's ecosystem, the same way that Square evolved its Seller ecosystem.\nCash App has 36 million monthly active users, which is up 140% since 2018, and it generated $529 million in the first quarter of 2021 (excluding Bitcoin).\nSquare recently acquired Tidal, a music streaming platform. I will highlight how Cash App can leverage Tidal to create a platform to better empowers musicians to participate in the economy.\nAccording to my estimates, Cash App is worth $73.5 billion today, which is currently ~65% of Square's current market cap.\nI'm bullish on Square and the ecosystem that it's creating within Cash App.\n\nInvestment Thesis\nCash App from Square(NYSE:SQ)is due for a large expansion in its offerings, similar to how the Seller ecosystem evolved over the last 10 years. The average bank generates about$880in revenue per active digital customer, while Cash App only generated$41per active user to end 2020. In order for Square to monetize Cash App, it must continue to build its platform and expand its services by attracting new users and offering new products.\nSquare will achieve this by extending economic empowerment to individuals just as its Seller ecosystem extended its customer’s business capabilities. Square recentlyacquired Tidal, Jay-Z’s artist-backed music streaming service. This is an opportunity for Cash App to work for individuals, specifically musicians.\n\n Given what Square has been able to do for sellers of all sizes and individuals through Cash App, we believe we can now work for artists to see the same success for them, and us. We’re going to start small and focus on the most critical needs of artists and growing their fan bases.-Jack Dorsey, Square CEO\n\nIn this article, I will highlight the opportunity Square has to expand Cash App’s ecosystem to empower individuals to better participate in the economy, specifically illustrating how its recent Tidal acquisition could pay off.\nThis is how Cash App operates under Square according toCash App's website,\n\n Cash App is redefining the world’s relationship with money by making it more relatable, instantly available and universally accessible.\"\n\nThis mission will result in a huge increase in Cash App’s average revenue per user, making Square a buy for long-term investors today.\nSquare Recap\nSince Square was founded by Jack Dorsey in 2009, the company’s core mission has remained the same: \"To empower businesses, sellers, and individuals toparticipate in the economy.\"Square carries out this mission through its Sellers ecosystem and Cash App.\nSellers ecosystem: It enables businesses to use their computers or mobile devices as a payment or point-of-sale solution for business transactions. Square has taken the Sellers ecosystem a step further by utilizing its customers’ data so they can better engage their customers and now Square Capitaloffers loansfor small businesses. This ecosystem is starting to mature and is scalable.\nCashApp: Offers a platform for individuals to spend, send, or receive money as well as invest in stocks or bitcoin. Cash App includes Square’s Cash Card which operates like a debit card for one’s Cash App and offers “boosts,” which allow its cash card customers to save money at different restaurants or merchants.\n\nSource:Square September 2020 Investor Presentation\nAs can be seen above, Square expanded its Sellers ecosystem by adding product offerings for its customers, while it's capitalizing on these opportunities by becoming an industrial bank. Now, when Square Capital provides a loan to a customer, the loan can be issued fromSquare’s bank. This is a win for Square because it provides the loan for its customers’ business to operate, so it’s making money off the loan as well as the sales its customers generate using Square’s point-of-sale.\nProgression of Cash App\n\nSource:www.wokfofharcourtstreet.com\n\nCash App entered 2021 with 36 million monthly active users and over100 milliondownloads\nCash App delivered a strong Q1 of 2021 generating$529 million, up 139% year-over-year (excluding bitcoin revenue)\nGross profits for Cash App were$420.5 millionin Q1, equivalent to a 79.5% gross profit margin (excluding bitcoin)\n\nCash App is crushing it and a large part of its success is the culture that’s implemented by Square in order to grow Cash App’s monthly active users. Cash App has an extremely low average customer acquisition cost of less than$5. Cash App accomplished this by partnering with celebrities, specifically music artists, to offer promotions and cash giveaways using Twitter and other social media sites (Instagram and Tik-Tok specifically). By doing this, celebrities expose their fans and followers to Cash App, and in turn, this triggers a network effect. The artists get more attention and positive publicity, while so does Cash App. For example, when Kim Kardashian announced on Twitter she’d give away $500,000 through Cash App, it resulted in Cash App reaching a lot of Twitter accounts. Cash App reaches at least50,000 uniqueTwitter users per Cash App post, similar to these below.\n\nSource:www.bettermarketing.pub\nCash App achieved viral growth cost effectively and is building its user base, but Cash App’s services are what leads to retaining and monetizing its user base. Some services we’ve seen thus far are investing in stocks and Bitcoin while Square has not lost sight of other opportunities as Cash App envisions further enabling its users.\n\nSource: Square September 2020 Investors Presentation\nNow that we understand Cash App’s business model and why it works, let us explore how Tidal fits in with Cash App’s mission. Ultimately, this will create a platform for musicians to operate as independent, small businesses.\nTidal + Cash App\nOn March 4, 2021, Squareacquired Tidalfor $297 million, only 4.2% of Square’s cash on its balance sheet. Tidal is unique because it strives to create afair playing fieldfor its artists and is backed by artist-owners. These artists will retain a certain level of ownership in Tidal moving forward.\nThese are some of Tidal’sartist-owners:\n\nAlicia Keys\nBeyoncé\nCalvin Harris\nColdplay's Chris Martin\nDaft Punk\nJack White\nJason Aldean\nShawn \"JAY-Z\" Carter\nKanye West\nLil Wayne\nMadonna\nRihanna\n\nWith these high-profile names and Jay-Z at the helm, Tidal got a lot of buzz but didn’t survive in a crowded streaming market. With these artists on board, Square is building its army and could use these artists to promote Cash App to continue to achieve a network effect. However, Jack Dorsey is rather focused on ensuring that musicians can better participate in the economy.\n\nSource:twitter.com\nIn the same Twitter thread, Dorsey acknowledges plans for Square to “start small” by focusing on the most critical needs for musicians and by growing their fan bases. Square will achieve this by creating new listening experiences for fans, simpleintegration of merchandise sales, as well as new revenue streams for musicians.\nStreaming changed the way people consume their music as the premier services offer platforms for consumers to listen to all their favorite artists for an affordable monthly price (about $10 per month for the top services). These services were put in place to combat music piracy, as the price of a CD or songwent to $0for people who knew how to use peer-to-peer file-sharing. Even though streaming sites were intended to level the playing field for musicians, it resulted in musicians being paid less for their music.\nTop paying streaming services pay out about$4 per 1,000 song streams, making it difficult for musicians (especially smaller, up-and-coming musicians) to make a living off their music. This forced musicians to turn to other opportunities to counteract the lack of revenue from their songs, specifically by selling merchandise. The global music merchandise market was worth$3.5 billionin 2018, a 13.4% CAGR over the prior three years, and Square believes it can further empower these artists.\n\nMerchandise Opportunity - by leveraging Tidal’s streaming service (the musicians and Tidal subscribers) with Cash App, Square could offer the ideal place for musicians to sell their merchandise (ie. creating a Shopify for musicians to monetize their merchandise, their brand, or even special experiences). Square can facilitate sales between musicians and Cash App users, while this strategy engages and monetizes the current Cash App users, it will surely attract more new users to Cash App.\n\nIf Square brings this idea to fruition, it would benefit both musicians and increase Cash App’s revenue stream. Currently, Square charges a2.95%fee when one of its Sellers accepts a transaction, but Square only keeps $0.50 or 1% of the purchase value as the rest goes to middlemen, the banks, and third parties. If Square creates a commerce platform for Tidal musicians to sell merchandise using Cash App, the artists could be paid directly, without middlemen, while Square could continue to charge a 2.95% fee for facilitating transactions, or could lower the fee to 1% to incentivize Cash App growth. Either way, it’s a win-win for musicians and Square:\n\nMusicians: Can directly sell to their fan bases, while directly receiving the funds.\nSquare: Grows Cash App by expanding the opportunity individuals have to spend their money while increasing its take rate.\n\nGiven the size of the global music merchandise market, $3.5 billion in 2018, and 13% growth over the previous three years, this is an ideal market for Square to unlock to see if it can empower individuals. Cash App grows virally by utilizing musicians to reach more people on social media, so this could be a natural path for Cash App to grow its user base while helping musicians reach current Cash App users. This also brings economic empowerment to musicians because Square will expand their revenue streams by letting the musicians sell directly to their fans.\n**Assumptions: Square keeps its take rate at 2.95%\n**The music merchandise industry grows 8% annually through 2030\nThe model above is a conservative projection based on Square creating a platform for Tidal and Cash App to disrupt the merchandise market for musicians. If Square achieves this, Square will continue to create a network effect by drawing musicians to the platform to sell, while it also brings monetization and more users to Cash App. This results in a network effect, hence why I assumed that Square’s market share will increase over time. As Cash App’s users are expected to increase, the data in this model may be too conservative, if musicians really flocked to Tidal + Cash App to distribute content or merchandise.\nThe column on the right is revenue just from merchandise sold by musicians, it doesn’t consider that as there are more users on Cash App, Square can monetize those users through the solutions it's already established such as peer-to-peer transactions or investing in stocks or bitcoin.\nLong-Term Agenda: Redefine How People Use Money\nThis is just touching the surface of how Square is growing Cash App but there are other use-cases for combining Tidal and Cash App, as well as opportunities for other types of creators and artists. I'm going to list a few below to highlight the early stages we are in, but rather shine light on the endless possibilities, as we're in a time of technological innovation and blockchain is still in its infancy.\n\nSource: Square September 2020 Investors Presentation\n\nConcert by Tidal: In 2012, Jay-Z founded Made in America, a huge annual music festival that is held in Philadelphia and is meant to bring together music and culture. The event is produced by Live Nation, (Jay-Z’s production company Rock Nation operates under them) and attracted more than100,000 peopleover the two-day festival in 2019 with 60 artists performing. In its first year, in 2012, the concert grossed$5 millionin ticket sales with 80,000 attendees. If Tidal and Cash App teamed to host an annual concert, it could be another way for Square to partner with musicians so they can be compensated fairly for performing (so they don’t have to deal with all the middlemen and fees), while pushing ticket sales through Cash App. Either way, this could be a big opportunity for Cash App to gain more exposure and users while promoting Tidal and its musicians.\nNFT’s for Artists: Non-fungible tokens are units of stored data that certify a digital asset to be unique; such as a photo, video, song, album, or any other digital file. This opportunity is unique because it gives the creator of the content control full control of the content, so there's no third party for a content creator to go through in order for them to sell and monetize their content. The creator is in control of the token and controls the licensing for the file while being able to monitor the transactions that take place on the network.\n\nNFT sales reached$2.5 billionin the first half of 2021 and artists are doing more and more regarding music sales using NFTs. For example, Kings of Leon recently released their new album as an NFT and generated$2 millionin sales. Kings of Leon dropped three different tokens for the launch: one being the special album package, the second token offers unique perks like gettingfront-row seats for lifeat Kings of Leon concerts, and the third is for exclusive visual art. This is clearly unique and innovative as it gives the artist a way to grasp their followers while engaging with fans in new ways.\n\nOpportunity for artists to get funding: For up-and-coming musicians who don't have access to funding, NFTs could be a way for them to access funds. For example, you can create an NFT for an upcoming album or song, and then sell the NFT to raise capital. In exchange, the buyers of the NFT will have some ownership of the upcoming project and receive royalties if the project gets licensed and played.\n\nThis is in Square’s space because this will extend artists' capabilities to raise funds for their projects, in turn, the holders of the NFT can have “equity” and invest in their favorite artists.\n\nContent Creators: The digital content creation market is expected to grow 12% annually through 2030 to reach$38.2 billion. If Square successfully creates a platform to empower musicians, I believe that Square could scale to bring those same solutions to any type of artist or content creator. Square’s goal is to achieve economic empowerment for everyone, and by extending its platform to all content creators to monetize their brand and digital assets, it could change the way fans support their favorite content creators. If Square unlocks this market, it would result in a huge jump in Cash App’s revenue because Square is building the network, through Cash App, for artists to directly reach and sell. Cash App's large user base may incentivize artists using this platform to gain exposure.\n\nOne area that I think this could be unique is for collegiate athletes. Now that college athletes can be paid based on theirname, image, or likeliness(NIL), Cash App could be a medium for athletes to engage fans or their community and be paid. It only became legal for student athletes to be compensated for their NIL, but this could be an area Square looks to help, as empowering individuals to participate in the economy is Square’s focus.\nFuture Revenue Projections\n\n\n\nYear\nARPU\nActive Users (in millions)\nRevenue ($ in billions)\n\n\n2021\n$41\n36\n$ 1.476\n\n\n2026\n$150\n70\n$ 10.5\n\n\n\nThe estimates for 2026 are my opinion of how Square capitalizes on the viral growth of Cash App through monetization. Cash App's future active users is a conservative estimate of how I think Cash App will grow by 2026 as its monthly active users have increased by 140% since 2018. In 2017, Cash App generated $15 per user while it had only 7 million monthly active users, yet in 2021, Cash App has 36 million users and generates over double the ARPU it did in 2017. Hence, why I think the $150 ARPU is realistic by 2026, as I’ve highlighted that Cash App has long-term plans for changing the way that people interact with money.\nUsing Cash App’s first quarter revenue ($529M) and using a 35% free cash flow margin to determine Cash App’s free cash flow today, Cash App generates $1.48 in free cash flow per share.\nHere’s the value of Cash App on a stand-alone basis (excluding Bitcoin revenue).\n\nSource: L.A. Stevens Valuation Model\nCash App is worth ~$146 today while Square is trading around $245. For Cash App’s free cash flow margin, 35% is conservative as Cash App sports 80% gross profit margins, while 30% annualized free cash flow growth is attainable because Cash App’s annual revenue increased by137% in 2020 and 139% year-over-year in Q1 of 2021.\nCash App makes up 65% of Squares market cap today, as Cash App is worth 73.5 billion in market cap based on its present value. With Square’s market cap of $110 billion, the stock is still in buy territory as growth in the Cash App ecosystem may not be reflected where the stock’s trading today.\nConclusion\nCash App’s growth since 2017 is remarkable, considering that it went from 3 million users at the end of 2016 to over 36 million monthly active users today. Square is in a great position today to cash in on Cash App’s strong foundation by taking it to the next step - by building its ecosystem and becoming a platform for commerce and specifically for individuals. Over the coming years, we will see how Square incorporates more services to provide value to both individual sellers or buyers, but Square has a long-term mindset to disrupt people’s relationship with money.\nHere is a quote from the head of Cash App, Brian Grassadonia, from Square’s lastkeynote presentation.\n\n I think Apple has done this (redefining an industry) when we think about our relationship with technology, pre, and post-Apple. I think Google has done this when we think about our relationship with information, pre, and post-Google. And when I talk about redefining the world's relationship with money, I'm talking about redefining the world's relationship with money with similar breadth and scope that those organizations have redefined the world's relationship with their industries. That is a very, very big - you kind of can't even imagine what that means, right, when you're kind of sitting in it. You only really kind of identify that once you've already done it.”\n\nTo wrap up, Square is going to be one of the most disruptive companies of this generation. With superior leadership, specifically with Brian Grassadonia as head of Cash App and Jack Dorsey as CEO of Square, the company remains fixated on the long-term growth prospects that its original two ecosystems can leverage to further economically empower individuals. We will see how Square ultimately plans to leverage its Tidal acquisition, but there are plenty of opportunities for Square to connect musicians to consumers, as I’ve highlighted.\nAt Beating The Market, we've been long on Square since it was trading around $80 a year ago, when we first analyzed Cash App's growth, feel free to check out this notehere. As Cash App remains in growth mode today, Square’s stock is still a buy trading below $250 for those looking to buy and hold for the long-term.\nThanks for reading and happy investing!","news_type":1},"isVote":1,"tweetType":1,"viewCount":112,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":170070306,"gmtCreate":1626397490905,"gmtModify":1703759307209,"author":{"id":"4089431764587050","authorId":"4089431764587050","name":"ZHKNG","avatar":"https://static.tigerbbs.com/795ff17bd4982775f700470e7bd01266","crmLevel":2,"crmLevelSwitch":0,"followedFlag":false,"idStr":"4089431764587050","authorIdStr":"4089431764587050"},"themes":[],"htmlText":"Follow","listText":"Follow","text":"Follow","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/170070306","repostId":"1143835393","repostType":4,"repost":{"id":"1143835393","pubTimestamp":1626396523,"share":"https://ttm.financial/m/news/1143835393?lang=&edition=fundamental","pubTime":"2021-07-16 08:48","market":"us","language":"en","title":"Cramer's Mad Money Recap: Why Stocks Are Going Down","url":"https://stock-news.laohu8.com/highlight/detail?id=1143835393","media":"The Street","summary":"Jim Cramer says it's not so much about the economy as it is the simple rules of supply and demand. T","content":"<blockquote>\n Jim Cramer says it's not so much about the economy as it is the simple rules of supply and demand. There's not enough cash to buy everything.\n</blockquote>\n<p>There are a lot of theories on why stocks are going down, Jim Cramer told his Mad Money viewers Thursday, but there's only one theory that's correct. As he noted on last night's show, too often investors can't see the forest for the trees instead focusing on the economy rather than the fundamentals of supply and demand.</p>\n<p>For example, many investors are taking their cue from the bond markets, which are far bigger than stocks. They have all sorts of theories as to why bond yields are plunging.</p>\n<p>Is it because our rates are better than the rest of the world? Is it because Federal Reserve chairman Jay Powell is right and inflation is only transitory? Or is it because we're about to see a slowdown in our economy?</p>\n<p>Cramer said while he does believe that Powell is correct and inflation is transitory, none of these reasons really explain the action in bonds or in the stock market. What does explain the action, however, is supply and demand.</p>\n<p>For months now, the markets have been flooded with new offerings in the form of IPOs and SPACs, and the market has increasingly struggled to absorb them all. Eventually, as it always does, supply outstrips demand and prices plunge, just as they are now. There's simply not enough cash to buy everything.</p>\n<p>So while everyone has their theories, the truth is that employment is strong and inflation is waning. But when it comes to IPOs, the cycle has simply run its course.</p>\n<p><b>Secretary of Commerce Gina Raimondo</b></p>\n<p>In a special interview, Cramer welcomed back Gina Raimondo, U.S. Secretary of Commerce, for an update on the White House's economic plans to keep the economy moving forward. President Biden's latest plans include a $600 billion infrastructure package to rebuild roads, bridges and the nation's power grid, and a $3.5 trillion budget proposal that includes universal pre-kindergarten and two-year community college, among other priorities.</p>\n<p>Raimondo said there are still millions of women out of the workforce because they're struggling with childcare and elder care. That's why the latest proposals include investments in caregiving as well as universal kindergarten to give all of our children a head start on their education.</p>\n<p>Additionally, Raimondo said we need to invest more in digital literacy and digital skills for our modern world. That includes getting more girls and minorities involved in data science so they can compete on a global stage.</p>\n<p>When asked about supply chain disruptions caused by the pandemic, Raimondo called out Friday's scheduled meeting at the White House, which will include the home building and construction industries, that aims to address shortages in lumber and other building supplies. If we can produce more, prices will decline, Raimondo said, and that's the goal.</p>\n<p><b>Bull in the Second-Hand Shop</b></p>\n<p>There's a new long-term bull market brewing in the secondhand marketplace, Cramer told viewers, and it's time to compare the players and pick a winner. The contenders include Poshmark&nbsp;(<b>POSH</b>) -Get Report, ThredUp&nbsp;(<b>TDUP</b>) -Get Report&nbsp;and RealReal&nbsp;(<b>REAL</b>) -Get Report, along with Etsy&nbsp;(<b>ETSY</b>) -Get Report, which just purchased Depop for $1.6 billion, and the king of secondhand goods, eBay&nbsp;(<b>EBAY</b>) -Get Report.</p>\n<p>For comparison, eBay is clearly the largest, with 187 million buyers around the globe. EBay is followed by Poshmark at seven million, Etsy with four million, ThredUp at 1.3 million and RealReal with just 700,000.</p>\n<p>Cramer said with 42% revenue growth, his favorite in the space is PoshMark, which appeared recently on the show. He said both eBay and Etsy remain fabulous companies as well, but Poshmark has the growth. ThredUp simply isn't that exciting at just 15% growth, he said, and RealReal is still recovering from its authenticity issues surrounding counterfeit items on its platform.</p>\n<p><b>Executive Decision:&nbsp;Corsair Gaming</b></p>\n<p>In his \"Executive Decision\" segment, Cramer spoke with Andy Paul, co-founder and CEO of Corsair Gaming&nbsp;(<b>CRSR</b>) -Get Report, makers of high-end gaming peripherals.</p>\n<p>Paul noted that while the number of gamers has increased between 3% to 4% every year over the past few years, gaming hardware has grown by 24%, on average, and gamers continually upgrade their equipment to the latest technologies.</p>\n<p>Paul added that if you think about gaming as a hobby or a sport, no one buys just one set of golf clubs or one set of skis. The same applies to gaming, where people start with the basics and upgrade over time.</p>\n<p>Corsair is also very active in the streaming space, making lighting and other gear gamers need to broadcast their games live to the world. Paul noted his company's first foray into gaming cameras, which provides all of the features of a DSLR in a simple webcam package.</p>\n<p><b>Lightning Round</b></p>\n<p>Here's what Jim Cramer had to say about some of the stocks that callers offered up during the \"Mad Money Lightning Round\" Thursday evening:</p>\n<p>Rio Tinto&nbsp;(<b>RIO</b>) -Get Report: \"I think Rio Tinto is a good company and I want you to hold onto it.\"</p>\n<p>QuantumScape&nbsp;(<b>QS</b>) -Get Report: \"There are other companies that claim they have better batteries and I'm starting to believe them.\"</p>\n<p>VMware&nbsp;(<b>VMW</b>) -Get Report: \"I'd rather own Dell&nbsp;(<b>DELL</b>) -Get Report&nbsp;than VMWare.\"</p>\n<p>Veru(<b>VERU</b>) -Get Report: \"They need to get into Stage III trials before we can get excited about them.\"</p>","source":"lsy1610613172068","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Cramer's Mad Money Recap: Why Stocks Are Going Down</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nCramer's Mad Money Recap: Why Stocks Are Going Down\n</h2>\n\n<h4 class=\"meta\">\n\n\n2021-07-16 08:48 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://www.thestreet.com/jim-cramer/cramers-mad-money-recap-july-15-2021><strong>The Street</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Jim Cramer says it's not so much about the economy as it is the simple rules of supply and demand. There's not enough cash to buy everything.\n\nThere are a lot of theories on why stocks are going down,...</p>\n\n<a href=\"https://www.thestreet.com/jim-cramer/cramers-mad-money-recap-july-15-2021\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{".DJI":"道琼斯",".IXIC":"NASDAQ Composite",".SPX":"S&P 500 Index","SPY":"标普500ETF"},"source_url":"https://www.thestreet.com/jim-cramer/cramers-mad-money-recap-july-15-2021","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1143835393","content_text":"Jim Cramer says it's not so much about the economy as it is the simple rules of supply and demand. There's not enough cash to buy everything.\n\nThere are a lot of theories on why stocks are going down, Jim Cramer told his Mad Money viewers Thursday, but there's only one theory that's correct. As he noted on last night's show, too often investors can't see the forest for the trees instead focusing on the economy rather than the fundamentals of supply and demand.\nFor example, many investors are taking their cue from the bond markets, which are far bigger than stocks. They have all sorts of theories as to why bond yields are plunging.\nIs it because our rates are better than the rest of the world? Is it because Federal Reserve chairman Jay Powell is right and inflation is only transitory? Or is it because we're about to see a slowdown in our economy?\nCramer said while he does believe that Powell is correct and inflation is transitory, none of these reasons really explain the action in bonds or in the stock market. What does explain the action, however, is supply and demand.\nFor months now, the markets have been flooded with new offerings in the form of IPOs and SPACs, and the market has increasingly struggled to absorb them all. Eventually, as it always does, supply outstrips demand and prices plunge, just as they are now. There's simply not enough cash to buy everything.\nSo while everyone has their theories, the truth is that employment is strong and inflation is waning. But when it comes to IPOs, the cycle has simply run its course.\nSecretary of Commerce Gina Raimondo\nIn a special interview, Cramer welcomed back Gina Raimondo, U.S. Secretary of Commerce, for an update on the White House's economic plans to keep the economy moving forward. President Biden's latest plans include a $600 billion infrastructure package to rebuild roads, bridges and the nation's power grid, and a $3.5 trillion budget proposal that includes universal pre-kindergarten and two-year community college, among other priorities.\nRaimondo said there are still millions of women out of the workforce because they're struggling with childcare and elder care. That's why the latest proposals include investments in caregiving as well as universal kindergarten to give all of our children a head start on their education.\nAdditionally, Raimondo said we need to invest more in digital literacy and digital skills for our modern world. That includes getting more girls and minorities involved in data science so they can compete on a global stage.\nWhen asked about supply chain disruptions caused by the pandemic, Raimondo called out Friday's scheduled meeting at the White House, which will include the home building and construction industries, that aims to address shortages in lumber and other building supplies. If we can produce more, prices will decline, Raimondo said, and that's the goal.\nBull in the Second-Hand Shop\nThere's a new long-term bull market brewing in the secondhand marketplace, Cramer told viewers, and it's time to compare the players and pick a winner. The contenders include Poshmark (POSH) -Get Report, ThredUp (TDUP) -Get Report and RealReal (REAL) -Get Report, along with Etsy (ETSY) -Get Report, which just purchased Depop for $1.6 billion, and the king of secondhand goods, eBay (EBAY) -Get Report.\nFor comparison, eBay is clearly the largest, with 187 million buyers around the globe. EBay is followed by Poshmark at seven million, Etsy with four million, ThredUp at 1.3 million and RealReal with just 700,000.\nCramer said with 42% revenue growth, his favorite in the space is PoshMark, which appeared recently on the show. He said both eBay and Etsy remain fabulous companies as well, but Poshmark has the growth. ThredUp simply isn't that exciting at just 15% growth, he said, and RealReal is still recovering from its authenticity issues surrounding counterfeit items on its platform.\nExecutive Decision: Corsair Gaming\nIn his \"Executive Decision\" segment, Cramer spoke with Andy Paul, co-founder and CEO of Corsair Gaming (CRSR) -Get Report, makers of high-end gaming peripherals.\nPaul noted that while the number of gamers has increased between 3% to 4% every year over the past few years, gaming hardware has grown by 24%, on average, and gamers continually upgrade their equipment to the latest technologies.\nPaul added that if you think about gaming as a hobby or a sport, no one buys just one set of golf clubs or one set of skis. The same applies to gaming, where people start with the basics and upgrade over time.\nCorsair is also very active in the streaming space, making lighting and other gear gamers need to broadcast their games live to the world. Paul noted his company's first foray into gaming cameras, which provides all of the features of a DSLR in a simple webcam package.\nLightning Round\nHere's what Jim Cramer had to say about some of the stocks that callers offered up during the \"Mad Money Lightning Round\" Thursday evening:\nRio Tinto (RIO) -Get Report: \"I think Rio Tinto is a good company and I want you to hold onto it.\"\nQuantumScape (QS) -Get Report: \"There are other companies that claim they have better batteries and I'm starting to believe them.\"\nVMware (VMW) -Get Report: \"I'd rather own Dell (DELL) -Get Report than VMWare.\"\nVeru(VERU) -Get Report: \"They need to get into Stage III trials before we can get excited about them.\"","news_type":1},"isVote":1,"tweetType":1,"viewCount":155,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0}],"defaultTab":"posts","isTTM":true}