The Market Might Care This Week

Different day, same direction... What's worth worrying about... The market might care this week... A Super Bowl of financial activity... The self-destruction of Twitter is nearly complete... Giving up your verb... [Stansberry Research Logo] Delivering World-Class Financial Research Since 1999 [Stansberry Digest] Different day, same direction... What's worth worrying about... The market might care this week... A Super Bowl of financial activity... The self-destruction of Twitter is nearly complete... Giving up your verb... --------------------------------------------------------------- The run higher for stocks continues... The pace of the recent move for the U.S. stock indexes may have slowed slightly in the past few trading days, but the direction remains largely the same – up. The benchmark S&P 500 Index closed half a percentage point higher, to within a whisker of its 2023 high set last week. And maybe most notably, the boring ol' Dow Jones Industrial Average has broken out to its highest level since April of last year. The tech-heavy Nasdaq Composite Index and the small-cap Russell 2000 each finished up roughly 0.2%. I (Corey McLaughlin) wrote last week that it looked like [the animal spirits were returning to the stock market]( and they might stick around until further notice. The story hasn't changed materially as we begin another week, but we'll keep watching our indicators... It beats reading the headlines... We were reminded of this idea today while listening to the latest episode of Stansberry Research senior analyst Matt McCall's podcast. Matt welcomed noted market analyst Jim Bianco, who noted that reading the mainstream media can be tough these days. Indeed, scrolling through the major news headlines – financial or otherwise – can be depressing, frustrating, or anger-inducing. But the stock market doesn't care... As Jim told Matt on [his Making Money podcast](... For all the issues and all the things you worry about, you have to ask yourself, 'Does that change the earnings of the S&P 500?' And for a lot of them, the answer is no. Yes, you can be worried and pessimistic about certain things. But don't let it bleed into what you think the outlook for the economy might be, or for the earnings of a company, or the outlook for the market. Those can be two different things. The market is going to be driven by financial and economic-related factors, like interest rates, the outlook for the economy, taxes... So, speaking of that... The next few days will be like a Super Bowl of financial activity... First off, this week, more than 150 S&P 500 companies totaling more than $25 trillion in market cap will report their quarterly financials. The list includes several members of the "Magnificent Seven," such as Microsoft (MSFT) and Alphabet (GOOGL), which report after hours on Tuesday, then Meta Platforms (META) following Wednesday's close. With all the focus on these names and the returns generated by them this year, an earnings "surprise" one way or another could send a jolt into their shares, and thus the indexes. As we mentioned [a few weeks ago]( the bar for companies this quarter was relatively low heading into this earnings season. Wall Street analysts said they expected a decline of close to 7% year-over-year decline in earnings for the S&P 500. As of Friday, three-quarters of the companies that had reported – which was roughly 20% of the S&P 500 – beat earnings per share estimates. If mega-caps and others beat that projection this week, share prices are likely to head higher. Secondly, the Federal Reserve, the European Central Bank, and the Bank of Japan each meet and will announce policy decisions this week. The Fed decision comes first on Wednesday afternoon, followed by the ECB on Thursday morning, and the BoJ late Thursday night. The consensus bet among bond traders is that the Fed will hike its benchmark bank-lending rate by 25 basis points to a range of 5.25% to 5.50%. Leaving current rates in place or raising them further would each be a complete shock. So rather than pondering such an unlikely outcome, I'm expecting to pay attention more to the messages Fed Chair Jerome Powell sends in his post-meeting press conference about two points... - His thoughts on future rate hikes and his best guess on inflation. The central bank has previously indicated two more hikes to come by the end of the year and that the pace of inflation hasn't come down as quickly as it wants. Is that still the plan? - How the Fed perceives the current economy today. Is it strong or weak? Is the central bank still expecting a "mild recession" like it had earlier in the year? Does it expect the jobs market – at least by official statistics – to break anytime soon? Amid all these central bank meetings, a second-quarter U.S. gross domestic product estimate will be published Thursday morning and the latest core personal consumption expenditures ("PCE") measure – the Fed's preferred inflation measure – comes out Friday morning. Moving on to self-destruction... Elon Musk, the owner of the formerly publicly traded company known as Twitter, just rebranded the social media platform as "X." How appropriate... and another step in what has been a gradual self-destruction of the social media platform. Musk says the change is part of a sweeping plan to create an "everything app" for audio, video, messaging, and payments. But for now, all it means is that the company logo doesn't match its name anymore and that the company seems to be searching for an identity. If you go to twitter.com today, you won't see the familiar bird logo, but a stylized X. Yet language on the platform still refers to the old name, like the giant "tweet" button to write a post. If this were a school project, a computer programming student would lose significant points for the mixed messaging. Twitter CEO Linda Yaccarino, hired in May, wrote a post on Twitter/X on Sunday about the vision moving ahead... She even included the buzzword "artificial intelligence," surely in an effort of generating some AI-related hope around the business... X is the future state of unlimited interactivity – centered in audio, video, messaging, payments/banking – creating a global marketplace for ideas, goods, services, and opportunities. Powered by AI, X will connect us all in ways we're just beginning to imagine. Oh, is that all? Musk declared from on high that "tweets" will now be referred to as "x's," which I bet just about nobody will do anytime soon, if ever. We could be wrong, but it's as if Musk really wants to end Twitter for good... and burn the last of the $44 billion he spent on the company last year. That's what our friend and colleague Dave Lashmet, editor of Stansberry Venture Technology, [wrote here in January]( that Musk was already doing. Dave compared Musk gutting Twitter's staff to reducing a professional football team to a roster of a placekicker and one defensive player. As Dave wrote... Granted, you still own the stadium, merchandising rights to the team logo, and the mascot's costume... But you got rid of 90% of the players... and 90% of the marketing department, 90% of the coaching staff, and even 90% of the janitors. That'll save you some labor costs, sure. But good luck putting a competitive team on the football field... or selling tickets, merchandise, or new advertising in the stadium or on television... or keeping anything clean. That's an obvious way to turn a $4.4 billion investment, which is in the ballpark of what NFL teams are worth these days, into a dumpster fire. Now imagine doing this at 10 times the scale... If you did this 10 times over – and shed 90% of thousands of staffers – that's what Elon Musk did to Twitter. Today, most businesses would love to have the brand recognition that Twitter has (or had). It's rare for your business to become its own popular verb in the way "tweet" has been, or how "Googling" refers to search or "Xeroxing" meant making photocopies. Twitter is now voluntarily giving up unpaid brand awareness at a time when its paid advertising has cratered. This isn't a personal criticism of Musk, though... It's about business. First off, in general with eccentric billionaires, you take the bad with the good. Secondly, remember, Musk tried to backstep out of agreeing to buy Twitter once he learned more about the company but decided it wasn't worth the legal fight or costs. He knew it was a mess, a media business that had found tweets and users difficult to monetize. I give Musk credit for building Tesla (TSLA) into what it has become... and for co-founding what became PayPal (PYPL) way back when... and for being a billionaire... And Twitter still reportedly has more than 200 million daily users. (I use it less often, but I still find useful ideas on the platform.) But since Musk took over, Twitter users have experienced a variety of puzzling developments. Notably, these include the removal of the once-free "blue check" verification status, which led to instant growth in parody accounts and obviously not enough revenue after asking folks to pay for it. Users' feeds also became cluttered by posts served by algorithms rather than their own followed accounts. There is obviously an appetite in the market for an alternative to the platform. More than 100 million people recently signed up for [Meta Platforms' Threads app]( a Twitter clone, in just five days. (Herb Greenberg over at our corporate affiliate Empire Financial Research wrote a great "[open letter]( a few weeks ago to Musk describing why this may be.) Maybe "X" can develop its business model into something worthwhile, but I won't be holding my breath... and will probably spend less time on whatever X is and more time researching publicly traded companies. Twitter/X is now privately held, and its financials won't be publicly disclosed in any routine fashion. But it is losing money... In March, Musk wrote in an eventually leaked memo to the company's staff that Twitter was valued at less than $20 billion, less than half of his purchase price six months earlier. And earlier this month, Musk disclosed on Twitter that the company's cash flows are negative, it carries a "heavy debt load," and paid advertising had dropped 50% on the platform. This is what Dave referred to in a January Digest shortly after Musk took over... Industry data from November show new advertising dollars coming into Twitter were down nearly 50%. And the best way to monetize a social media network is through advertising. It's not clear how Twitter will recover. More likely than "X" developing into a winner, I could see it maintaining its status as a media arm or a continued idea sandbox for Musk's other interests, like SpaceX or the new AI startup he recently launched called xAI, whose goal is to "understand the true nature of the universe." This all sounds less like business than like religion. In any case, Dave sure was right when he wrote about the inevitable demise of Twitter back in January – and explained where the company was headed... gone, by its own doing. The Zero-Rate Years Are Gone Market analyst Jim Bianco thinks inflation will remain "sticky" and the Fed will raise interest rates even more, but this scenario isn't necessarily bad for all stocks... [Click here]( to watch this video right now. For more free video content, [subscribe to our Stansberry Research YouTube channel](... and don't forget to follow us on [Facebook]( [Instagram]( [LinkedIn]( and [Twitter](. --------------------------------------------------------------- Recommended Links: # [Here's What You Missed Last Week – 2023 AI Race]( Marc Chaikin helped build Wall Street, and Dr. David Eifrig is a former vice president at Goldman Sachs. With more than 90 years of combined investing experience, they both agree: Artificial intelligence is a double-edged sword that could either make or break your wealth. But they believe most people don't know the real story! That's why they joined forces last week to cut through the hype and answer all your burning questions about what AI could mean for you and your money in 2023. [Click here to tune in now (and get three free stock predictions)](. --------------------------------------------------------------- # [BREAKING NEWS: '3,050% Currency Trade' Just Went Live]( Days ago, the Federal Reserve released a new money platform that will be adopted by the U.S. Treasury, Social Security Administration, and more. It's an investment opportunity we may never see again in our lifetimes. [Click here for the full details (including a free recommendation)](. --------------------------------------------------------------- New 52-week highs (as of 7/21/23): ABB (ABBNY), Abbott Laboratories (ABT), Brown & Brown (BRO), CBOE Global Markets (CBOE), Cintas (CTAS), Expeditors International of Washington (EXPD), Roper Technologies (ROP), Sprouts Farmers Market (SFM), Shell (SHEL), Sherwin-Williams (SHW), Constellation Brands (STZ), United States Commodity Index Fund (USCI), Verisk Analytics (VRSK), and Walmart (WMT). In today's mailbag, feedback on [Crypto Capital editor Eric Wade's Friday essay]( about the launch of FedNow, which began with a recent suggestion by presidential candidate Robert F. Kennedy Jr... Do you have a comment or question? As always, e-mail us at feedback@stansberryresearch.com. "RFK is absolutely right. Backing our paper money with hard assets is many decades overdue. Ever since Nixon took us off the gold standard, our money value has continued to go straight into the toilet bowl. So much so that the dollar is now only worth cents. And the biggest value killer is that by taking us off the gold standard, politicians can do whatever they want to do with our tax dollars. Which they have been doing for decades with reckless abandon. Now our financial situation, inflation, and debt level is so dire that the only way to get some control over it is to go back to backing the buck with hard assets." – Subscriber John M. "[RFK Jr. said] 'Backing dollars and U.S. debt obligations with hard assets could help restore strength back to the dollar, rein in inflation, and usher in a new era of American financial stability, peace, and prosperity.' "'Yeah, but what about us?' – The Elite." – Subscriber Mark P. All the best, Corey McLaughlin Baltimore, Maryland July 24, 2023 --------------------------------------------------------------- Stansberry Research Top 10 Open Recommendations Top 10 highest-returning open positions across all Stansberry Research portfolios Stock Buy Date Return Publication Analyst MSFT Microsoft 11/11/10 1,250.4% Retirement Millionaire Doc MSFT Microsoft 02/10/12 1,079.6% Stansberry's Investment Advisory Porter ADP Automatic Data 10/09/08 852.3% Extreme Value Ferris wstETH Wrapped Staked Ethereum 02/21/20 703.9% Stansberry Innovations Report Wade HSY Hershey 12/07/07 596.7% Stansberry's Investment Advisory Porter WRB W.R. Berkley 03/16/12 543.4% Stansberry's Investment Advisory Porter BRK.B Berkshire Hathaway 04/01/09 513.0% Retirement Millionaire Doc AFG American Financial 10/12/12 410.7% Stansberry's Investment Advisory Porter TTD The Trade Desk 10/17/19 341.0% Stansberry Innovations Report Engel FSMEX Fidelity Sel Med 09/03/08 318.8% Retirement Millionaire Doc Please note: Securities appearing in the Top 10 are not necessarily recommended buys at current prices. The list reflects the best-performing positions currently in the model portfolio of any Stansberry Research publication. The buy date reflects when the editor recommended the investment in the listed publication, and the return shows its performance since that date. To learn if a security is still a recommended buy today, you must be a subscriber to that publication and refer to the most recent portfolio. --------------------------------------------------------------- Top 10 Totals 4 Stansberry's Investment Advisory Porter 3 Retirement Millionaire Doc 2 Stansberry Innovations Report Engel/Wade 1 Extreme Value Ferris --------------------------------------------------------------- Top 5 Crypto Capital Open Recommendations Top 5 highest-returning open positions in the Crypto Capital model portfolio Stock Buy Date Return Publication Analyst wstETH Wrapped Staked Ethereum 12/07/18 1,602.5% Crypto Capital Wade ONE-USD Harmony 12/16/19 1,074.6% Crypto Capital Wade POLY/USD Polymath 05/19/20 1,032.2% Crypto Capital Wade MATIC/USD Polygon 02/25/21 828.2% Crypto Capital Wade BTC/USD Bitcoin 11/27/18 695.9% Crypto Capital Wade Please note: Securities appearing in the Top 5 are not necessarily recommended buys at current prices. The list reflects the best-performing positions currently in the Crypto Capital model portfolio. The buy date reflects when the recommendation was made, and the return shows its performance since that date. To learn if it's still a recommended buy today, you must be a subscriber and refer to the most recent portfolio. --------------------------------------------------------------- Stansberry Research Hall of Fame Top 10 all-time, highest-returning closed positions across all Stansberry portfolios Investment Symbol Duration Gain Publication Analyst Nvidia^* NVDA 5.96 years 1,466% Venture Tech. Lashmet Band Protocol crypto 0.32 years 1,169% Crypto Capital Wade Terra crypto 0.41 years 1,164% Crypto Capital Wade Inovio Pharma.^ INO 1.01 years 1,139% Venture Tech. Lashmet Seabridge Gold^ SA 4.20 years 995% Sjug Conf. Sjuggerud Frontier crypto 0.08 years 978% Crypto Capital Wade Binance Coin crypto 1.78 years 963% Crypto Capital Wade Nvidia^* NVDA 4.12 years 777% Venture Tech. Lashmet Intellia Therapeutics NTLA 1.95 years 775% Amer. Moonshots Root Rite Aid 8.5% bond 4.97 years 773% True Income Williams ^ These gains occurred with a partial position in the respective stocks. * The two partial positions in Nvidia were part of a single recommendation. Editor Dave Lashmet closed the first leg of the position in November 2016 for a gain of about 108%. Then, he closed the second leg in July 2020 for a 777% return. And finally, in May 2022, he booked a 1,466% return on the final leg. Subscribers who followed his advice on Nvidia could've recorded a total weighted average gain of more than 600%. You have received this e-mail as part of your subscription to Stansberry Digest. If you no longer want to receive e-mails from Stansberry Digest [click here](. Published by Stansberry Research. You’re receiving this e-mail at {EMAIL}. Stansberry Research welcomes comments or suggestions at feedback@stansberryresearch.com. This address is for feedback only. 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