CHARGED UP. The transition to clean energy needs more than wind and solar. Alkaline Fuel Cell Power is bringing sustainable energy infrastructure to the masses. Through low-cost, high-efficiency hydrogen fuel cells, and cleaner on-site heat and power generation, Alkaline is bringing greener power to the people.*
*This is sponsored advertising content and the disclaimer at the bottom of this email MUST be read carefully.
Credit Suisse is borrowing $54 billion from the Swiss National Bank to help shore up liquidity.
Big week for bank bailouts!
Prices as of 4 pm EST, 3/15/23
An unexpected decline in producer prices might have been the top news yesterday, if not for Credit Suisse’s loud selloff (more on that below). The slowdown in prices was paired with a larger-than-expected decline in retail sales, which together give the Fed some (but not much) room for easing monetary policy.
The Atlanta Fed’s GDPNow model estimate for real GDP growth for the first quarter moved up to 3.2% yesterday driven by an increase in consumer spending growth. Just 8 days ago, estimates called for 2%.
Meanwhile, on the heels of widespread uncertainty surrounding the economic effects of small bank stress, Goldman Sachs has increased its odds of the US entering a recession to 35% from 25%. Those probabilities remain well below consensus, however, which see a 65% chance of an economic downturn in the next 12 months.
By way of fundamentals, Credit Suisse is no Silicon Valley or Signature Bank, but the troubled lender still stole the spotlight yesterday after its credit spreads went parabolic, suggesting investors anticipated a default on the horizon. Last night, Credit Suisse received a lifeline from the Swiss National bank which will let it borrow up to 50 billion francs to strengthen liquidity.
Already under review by Moody’s, the credit rating of First Republic bank is under further pressure. Yesterday, both S&P and Fitch cut the lender to “junk” even after regulators pledged support for the sector.
As for Wall Street’s biggest banks, they have not come out of this unscathed. The six largest banks have lost nearly $165 billion in market cap this month, or roughly 13% of their combined value. The drops suggest investors are concerned about cuts to net interest income from deposit outflows.
After being rangebound since December, US oil prices have broken down with prices falling to their lowest in 15 months. For investors, expanding US stockpiles and growing concerns over an economic slowdown at home and abroad are overshadowing an increase in demand from China’s reopening.
Disney: Bob Iger is weighing the possibility of selling off Hulu, ESPN, or both.
Reverse tigthening: According to JPMorgan, the Fed’s emergency loan program could inject $2 trillion in the US banking system.
Ernie: Baidu shares plunged after the Chinese tech company unveiled its AI chatbot Ernie to the public in an underwhelming pre-recorded video.
Potential ban: The Biden administration is threatening to ban TikTok in the US if its Chinese owners don’t sell their interests.
2023 GDP: Anticipating a pullback in lending and tighter standards for banks, Goldman Sachs has lowered its annual growth forecast to 1.2% from 1.5%.
Prices as of 4 pm EST, 3/15/23
$2.2 billion: That’s how much Sam Bankman-Fried paid himself from FTX to run the business (into the ground).
Laundering: US and German authorities have taken down ChipMixer–a crypto mixer like Tornado Cash–which is alleged to have facilitated the laundering of 152k Bitcoin.
Pause denied: A New York bankruptcy denied the government’s request to block a $1 billion deal between Binance.US and Voyager Digital.
Bitcoin funds: The number of coins held by Bitcoin funds–a widely used proxy for institutional activity–has fallen to a 17-month low.
New environment: Stripe raised $6.5 billion at a $50 billion valuation, which is a far cry from its peak of $95 billion in 2021.
Ryan Reynolds: T-Mobile is buying Mint Mobile (of which Reynolds is a significant shareholder) for $1.35 billion.
Metals: Brazilian mining giant Vale is exploring a spinoff or IPO of its metals unit after selling a 10% stake.
Locomotives: Regulators have greenlit Canadian Pacific Railway’s $27 billion acquisition of Kansas City Southern.
More CoD: After inking its third Call of Duty distribution deal yesterday, Microsoft has already added its fourth by reaching an agreement with Japanese cloud gaming provider Ubitus.
Disclaimer: The publisher does not guarantee the accuracy or completeness of the information provided in this page. All statements and expressions herein are the sole opinion of the author or paid advertiser.
Grit Capital Corporation is a publisher of financial information, not an investment advisor. We do not provide personalized or individualized investment advice or information that is tailored to the needs of any particular recipient.
THE INFORMATION CONTAINED ON THIS WEBSITE IS NOT AND SHOULD NOT BE CONSTRUED AS INVESTMENT ADVICE, AND DOES NOT PURPORT TO BE AND DOES NOT EXPRESS ANY OPINION AS TO THE PRICE AT WHICH THE SECURITIES OF ANY COMPANY MAY TRADE AT ANY TIME. THE INFORMATION AND OPINIONS PROVIDED HEREIN SHOULD NOT BE TAKEN AS SPECIFIC ADVICE ON THE MERITS OF ANY INVESTMENT DECISION. INVESTORS SHOULD MAKE THEIR OWN INVESTIGATION AND DECISIONS REGARDING THE PROSPECTS OF ANY COMPANY DISCUSSED HEREIN BASED ON SUCH INVESTORS’ OWN REVIEW OF PUBLICLY AVAILABLE INFORMATION AND SHOULD NOT RELY ON THE INFORMATION CONTAINED HEREIN.
No statement or expression of opinion, or any other matter herein, directly or indirectly, is an offer or the solicitation of an offer to buy or sell the securities or financial instruments mentioned.
Any projections, market outlooks or estimates herein are forward looking statements and are inherently unreliable. They are based upon certain assumptions and should not be construed to be indicative of the actual events that will occur. Other events that were not taken into account may occur and may significantly affect the returns or performance of the securities discussed herein. The information provided herein is based on matters as they exist as of the date of preparation and not as of any future date, and the publisher undertakes no obligation to correct, update or revise the information in this document or to otherwise provide any additional material.
The publisher, its affiliates, and clients of the a publisher or its affiliates may currently have long or short positions in the securities of the companies mentioned herein, or may have such a position in the future (and therefore may profit from fluctuations in the trading price of the securities). To the extent such persons do have such positions, there is no guarantee that such persons will maintain such positions.
Neither the publisher nor any of its affiliates accepts any liability whatsoever for any direct or consequential loss howsoever arising, directly or indirectly, from any use of the information contained herein.
By using the Site or any affiliated social media account, you are indicating your consent and agreement to this disclaimer and our terms of use. Unauthorized reproduction of this newsletter or its contents by photocopy, facsimile or any other means is illegal and punishable by law.
For Full Terms of Use Click HERE. For the Privacy Policy Click HERE.
Gritcapital.substack.com (“Grit”) is a website owned and operated by Substack. Grit is paid fees by the companies that make investment offerings on this website. Be aware that payment of these fees may put Grit in a conflict of interest with the investor. By accessing this website or any page thereof, you agree to be bound by the Terms of Use and Privacy Policy, in effect at the time you access this website or any page thereof. The Terms of Use and Privacy Policy may be amended from time to time. Nothing on this website shall constitute an offer to sell, or a solicitation of an offer to buy or subscribe for, any securities to any person in any jurisdiction where such an offer or solicitation is against the law or to anyone to whom it is unlawful to make such offer or solicitation. Grit is not an underwriter, broker-dealer, Title III crowdfunding portal or a valuation service and does not engage in any activities requiring any such registration. Grit does not provide advice on investments or structure transactions. Offerings made under Regulation A under the U.S. Securities Act of 1933, as amended (the "Securities Act") are available to U.S. investors who are “accredited investors” as defined by Rule 501 of Regulation D under the Securities Act well as non-accredited investors, who are subject to certain investment limitations as set forth in Regulation A under the Securities Act. In order to invest in Regulation A offerings, investors may be asked to fill out a certification and provide necessary documentation as proof of your income and/or net worth to verify that you are qualified to invest in offerings posted on this website. All securities listed on this site are being offered by, and all information included on this site is the responsibility of, the applicable issuer of such securities. Grit does not verify the adequacy, accuracy or completeness of any information. Neither Grit nor any of its officers, directors, agents and employees makes any warranty, express or implied, of any kind whatsoever related to the adequacy, accuracy, valuations of securities or completeness of any information on this site or the use of information on this site. Neither Grit nor any of its directors, officers, employees, representatives, affiliates or agents shall have any liability whatsoever arising from any error or incompleteness of fact, or lack of care in the preparation of, any of the materials posted on this website. Investing in securities, especially those issued by start-up companies, involves substantial risk. investors should be able to bear the loss of their entire investment and should make their own determination of whether or not to make any investment based on their own independent evaluation and analysis.
