And the Time's Person of the Year goes to... Elon Musk?😳

December 14, 2021 And the Time's Person of the Year goes to… Elon Musk?😳 Good morning traders, Welcome back to The Daily Setup. Markets were in the red yesterday thanks to falling yields and anticipation of the Fed’s meetings this week. Here’s what’s on the docket today: - Pfizer buys Arena Pharmaceuticals - Meme stocks have a bad Monday - Elon wins Time’s Person of the Year So give us a read and let’s get to work. Jeff Arena Pharmaceuticals, Bond trading, and Meme Stonks BIGGEST MOVER Step into the Arena Shares of Arena Pharmaceuticals shot up 93% in premarket trading and were up [over 80%]( by markets’ close Monday on news that Pfizer will [acquire them for $6.7B](. In classic gangster fashion, Pfizer’s doing an all-cash deal, buying each share outright for $100. For those keeping score at home, that’s double the shares’ Friday closing price of [$49.94](. Must have been a hell of a bender they had together this weekend. - Pfizer’s doing this to get ahold of Arena’s well-established cancer and inflammatory drug pipeline. The crown jewel of this program, etrasimod, has shown promise for treating ulcerative colitis, Crohn’s disease, atopic dermatitis, and more conditions full of big scary words. - Shares of Pfizer rose [4.59%]( Monday. This deal makes it clear that Pfizer’s not putting all its eggs in the vaccine basket, [something that Moderna can’t say](. Evidently, Pfizer’s not resting on its laurels after emerging as clear favorite in the battle against the 'vid, and that’s a good sign for the company’s well-being in the long term. If a drug like etrasimod turns out to be as successful as its developers hope, Pfizer could step into a whole different spotlight even when if COVID’s goes away. The name’s bond. Unprofitable bond. The Treasury, to every single person who ever trusted them!^ Bond traders are having their worst luck since the 1980s, and not just because coke’s not cheap anymore. Thanks to a November year-over-year CPI increase of [6.8%](, inflation’s gotten so high that bond investors have lost money on real yields for two years straight- and will probably continue to lose for years to come as a rising cost of living wipes out investment gains. - It’s not all inflation’s fault. Growth of the federal government’s debt has slowed down as the Fed started tapering asset purchases and eased off pandemic relief, driving Uncle Sam’s demand for cash- [and thus 10-year-Treasury yields-]( down. - But there’s another [weird phenomenon]( to blame: [intense pessimism]( plus a stock market boom that’s topped off pension funds for the first time since 2008. Older folks have extra money to spend, but so little confidence in the future that they’re stuffing it all into what’s historically been the safest possible option: bonds. Unfortunately for them, the only safe thing about this bet is that there’s no danger of making any money off it. It’s a weird time. When the safe option isn’t safe anymore, historically, many investors have looked for the next safest one: which could be investing in index funds, as they at least account for inflation. On the other hand, many investors may also consider investing in ETFs or stocks that have robust fundamentals and a history of steady, modest growth. Meme Stonks Get Bonked [December can be cruel]( The meme stonk king and queen, GameStop (GME) and AMC Entertainment (AMC), had a [tougher Monday]( than soon to be former Jaguars coach Urban Meyer, falling 13.9% and 15.5% respectively. The Reddit kids must be listening to a lot of [Counting Crows]( these days (is that considered classic rock yet, and if so somebody can prepare my room at the nursing home) because it’s been a long December for them. - GME has fallen 30% during the month and AMC is down 15.3% in December. Most wonderful time of the year eh? - AMC insiders have been [dumping the stock]( lately as well, with the CEO unloading $9.6M and the CFO unloading his entire stake of $565K, which certainly inspires confidence. - Risk-off days tend to hit the meme names harder, so continued weakness could exacerbate the downswing. To say that 2021 has been a wild ride for GME and AMC is an understatement. GME is up over 620% on the year, while AMC has gained 1,000% YTD, so 2022 will have a tough job following that. It’s probably going to take more than a guy in a headband with cat posters on the wall named Roaring Kitty to keep powering the memes. To Infinity and Beyond Token Talk [It’s a brave new world out there]( Pass the prune juice and hard candy fellow olds, because we’re about to see a [metaverse company go public](. And for those guessing, yes, it’s hitting the public market via a SPAC. InfiniteWorld, which sounds like a stoner’s comment after he smokes too much weed, is a metaverse infrastructure company that is merging with Aries Acquisition Corp. in a $700M deal. - InfiniteWorld works with brands to help them create digital assets and NFTs, and has already partnered with 75 companies and content creators. - The company will trade under the symbol JPG (of course it will) and the deal is expected to close in 1H 2022. - The transaction will fuel InfiniteWorld with [$171M in real money]( to help it grow its platform where people interact with a fake reality. JPG will give us a public company to watch how the metaverse infrastructure grows, as well as a tracking vehicle to see which brands adapt well to the changing digital landscape and which ones fall behind. Perhaps Nike will be building virtual sweatshops? Harley hits the open road Rumor has it Harley-Davidson (HOG) is [spinning off its electric motorcycle unit]( into a separate company via SPAC because blank check companies and corporate breakups are the hottest trends right now. The LiveWire unit will be valued at $1.77B and HOG will retain a 74% stake in the company. The market reacted favorably to the news, as Harley shares were up 4.7% on Monday. - LiveWire bikes were launched in 2019 and the company expects production volume to reach 101K by 2026. - Harley is[partnering on the deal with KYMCO](, a manufacturer of Taiwanese “motorcycles” which is a nice way of describing those 49cc scooters popular on college campuses driven by people with suspended licenses. At this point electric vehicles feel inevitable, and even the signature rumble of a Harley is not immune to disruption. It’s hard to imagine that the Hell’s Angels will be early adopters however. As long as the IPO market remains robust, it’s a solid hunch that any manufacturer with an EV unit will explore a spinoff to unlock value. And Kelly Leak wept. Link Roundup 📿 Other News Other News Link Roundup - France shows it’s cool about tax evasion by reducing UBS penalty by $3B ([Read]() - The very sound of J-Pow’s voice brings the stock market to its knees ([Read]() - Joe Manchin has a chance to break the government again ([Read]() - OPEC’s not scared of a little Omicron ([Read]() - Time’s Person of the year is Elon Musk, so at least he won’t get it next year ([Read]() [Time’s Person of the Year… and yes, Elon Musk liked this tweet (via @TrungTPhan)]( [Image] RagingBull, LLC 62 Calef Hwy. #233, Lee, NH 03861 [Unsubscribe from all RagingBull emails]( Questions or concerns about our products? Call or text us on your mobile: 1.800.123.4567 © Copyright 2020, [RagingBull]( - [Refund Policy]( - [Privacy Policy]( - [Terms & Conditions]( DISCLAIMER: To more fully understand any Ragingbull.com, LLC ("RagingBull") subscription, website, application or other service ("Services"), please review our full disclaimer located at [(. 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