The New Texas Stock Exchange

Sick all that woke sh*t in NYC? Come to the TXSE June 11, 2024 | Peel #728 Silver Banana goes to... [Aphinity. ]() In this issue of the Peel: - 💳 Consumer spending remains strong for some, just not for us - 🆙 KKR gets its own turnaround help with GameStop continuing to dive - 🤠Sick all that woke sh*t in NYC? Come to the TXSE Market Snapshot 📸 = Banana Bits 🍌 - Check out Apple’s disappointment on the [first day of WWDC]() - Elon readies to ban Apple products [from his companies](=) - CRE prices are down more than my spirits after [searching for a house all week](=) - PWC asks canned staff to go [full Soviet Russia]( Smart 1:1 coffee chats to boost team engagement with Aphinity.ai ☕ = Coffee chats are a big part of growing your career, and large banks use tools like [Aphinity.ai]( to create 1:1 intros between employees every week. Whether you're a student, young professional, or have career experience, it's beneficial to make new connections. Most people say that they don't know their colleagues, and it holds them back. It's no wonder employees are isolated, less productive, and feel like they're missing out on opportunities. If you're a team leader looking to improve retention & engagement in your organization, you need to be doing 1:1 employee intros. We recommend [Aphinity.ai]( because it's simple to set up AI-powered 1:1 intros between co-workers. It integrates directly with Email and Slack, and is great for new hire onboarding, mentorship programs, and more. It's also used by 300+ communities and student organizations to connect their members. PLUS: We're offering readers a free demo and an exclusive 25% discount. [Click here to get Aphinity.ai for your organization]( Macro Monkey Says 🐒 Spending: Mending or Ending? An addiction can be loosely defined as something you otherwise can’t live without. Think of things like nicotine, losing money on stocks, and/or getting rejected in your DMs. I used to call that my triple threat. But for the U.S. economy, our collective addiction involves just one thing: consumer spending. At ~70% of GDP, Uncle Sam can’t live without it. Recent overall spending reports have been trending weaker, but let’s look at some more colorful data and re-think these trends. The Numbers Recent data highlights consumer spending at restaurants and at home, two high-beta categories that typically drop first in recessions and rebound first in recoveries. [Source]( According to WSJ data above, spending at restaurants—or “food away from home”—has recently overtaken the amount we spend on groceries, or “food at home.” This is the first time this has happened in the data series' history, dating back to 1997. Like Dennis in “It’s Always Sunny in Philadelphia” we have to consider a wide range of implications. The initial assumption causes us to think that consumers feel flush with cash and ready to forget frugality at the bar and/or restaurant. But, considering egg producers and similar companies think they’re LVMH all of a sudden, consumers are shucking the grocery store as many Americans now feel that Publix is as luxurious as Steak 48. Data unveiled in [this survey](=) details how we’re budgeting for food. Normally, slowdowns in spending come with even larger slowdowns at sit-down restaurants, but drive upticks in fast food and cheap grocery stores. That’s not what we’re seeing today, as inflation has caused Americans to care less about how we’re filling our obese stomachs because prices have risen so much that it doesn’t even matter. [Source](=) While McDonald’s is becoming a luxury item, vehicles are moving in the opposite direction. According to WARD’s data per Apollo, spending on automobiles remains healthy. [Source](=) Apollo’s Chief Economist and certified size lord Torsten Sløk said the gains in auto sales are driven by “wealth gains for households via higher stock prices, higher home prices, and higher cash flow from fixed income.” Normally, higher interest rates drive slowdowns in auto sales due to heavy financing requirements. However, this is a clear microcosm of the theory that rates stimulate the economy more than they usually do. However, those benefiting from rising stock and home prices, along with increased cash flows from fixed-income assets, are already the wealthiest Americans. It’s the “ownership class” that’s killing it, using those funds to buy more and/or more expensive vehicles, while Americans without stocks, homes, and fixed-income assets feel no difference. The Takeaway? The tale of two economies rages on. Wealthy Americans are finding ways to spend their additional wealth and income at restaurants, dealerships, and elsewhere. But inflationary pressures continue to squeeze lower-income Americans from grocery store shelves to the bus station. That likely means consumer spending will remain healthy overall in the headline numbers, adding significance to the income bracket breakdown within these soon-to-come spending reports. We get the May CPI and PPI reports later this week, updating us on exactly how f*cked consumer prices became last month. What's Ripe 🤩 KKR Inc (KKR) 📈11.2% - KKR is used to creating turnaround stories, but on Monday, the S&P 500’s turnaround of KKR was one of the most successful of all time. - Shares in the PE firm ripped higher on news that it will be joining the S&P 500 along with Crowdstrike (CRWD, 7.3%) and GoDaddy (GDDY, 1.9%). - Investors love when companies join the index as passive investors and fund providers have to buy shares. Southwest Airlines (LUV) 📈7.0% - Who knew that sucking so badly could lead to share price gains? Well, Southwest did, as Elliot Management just got on board. - The activist investor famous for episodes like “fixing” Twitter in 2020 announced a $1.9bn stake in the airline, looking to oust both the CEO and Chair. - According to Elliott, Southwest has nosedived from best-in-class to just-as-sh*tty as others but issued a $47/sh price target with their help. What's Rotten 🤮 GameStop (GME) 📉12.0% - It’s almost like Warren Buffet and Ben Graham know what they’re talking about. And, GameStop is giving us a prime-time example. - Shares extended Friday’s drop as investors are still digesting a weak earnings report showing declining sales. - Plus, Keith Gill’s livestream was as helpful to the share price as Ryan Cohen’s day trading abilities. Best of luck, but look out below. Apple (AAPL) 📉1.9% - After years of disappointment compared to other tech firms, Apple could’ve won us back on Monday… but instead only furthered our disappointment. - The world’s 3rd most valuable company slipped as its “Apple Intelligence” AI platform and other WWDC announcements underwhelmed. - The AI platform will integrate ChatGPT into Apple products, but most analysts expect this to be temporary before Apple unveils proprietary tech. Thought Banana 🤔 Better In Texas? They say everything’s bigger in Texas, but, Citadel, BlackRock, and others are looking to make things better in America’s second-largest state. These firms are teaming up to Make Stock Exchanges Great Again. The Texas Stock Exchange, or TXSE, is a new entrant looking to disrupt the woke duopoly of the NYSE and Nasdaq. Financial media has been abuzz with this new industry player, so let’s find out what’s going on. What Happened? Last week, a consortium led by BlackRock and Citadel funded the TXSE with a fat $120mn check. Although the exchange won’t begin processing orders until next year, there’s plenty of work to do in the interim. Based on [CBOE data](), the current market share breakdown of on-exchange U.S. equities volume is: The reason the TXSE has stirred the pot so much already is layered. But to understand why, we have to understand competition in U.S. equity exchanges. Exchanges compete for liquidity, or in other words, they compete to fill orders from individuals and brokers. Rebates, low transaction fees, and other incentives are employed by exchanges to attract more order flow. So, creativity around incentivizing orders to the TXSE could be one route the new exchange will take to eat up market share. But the other big issue—and likely the reason for launching the TXSE—is that the Nasdaq and NYSE are allegedly woke. And we can see this in the other large revenue segment in which exchanges compete—for company listings. Karl Marx has ostensibly been hired by the Nasdaq as America’s #2 exchange has requirements on race, gender, sexuality, etc, for board members of listed companies. We all know that who you like to f*ck and what color you are is deeply important to your business acumen, but apparently, the TXSE disagrees (wild). [Source]( The Takeaway? This is America, so more competition is always good. But, for companies looking to go public, reputation is at risk during the listing process. Few firms will be willing to be the Neil Armstrong and Buzz Aldrin of the TXSE. If I had to guess, companies like Tesla and others with execs that see Texas as the Promised Land could be the first movers that drive more listings and volume to TXSE. Even if you disagree with the idea behind TXSE, it’s hard to bet against Ken Griffin and Larry Fink. The Big Question: Does the TXSE have a strategy? How will this play out next year? What companies will be first to list on the TXSE, if any? Banana Brain Teaser 💡 Previous 🗓 If Jake loses 8 pounds, he will weigh twice as much as his sister. Together they now weigh 278 pounds. What is Jake’s present weight, in pounds? Answer: 188 pounds Today 🕐 For each student in a certain class, a teacher adjusted the student’s test score using the formula y = 0.8x + 20, where x is the student’s original test score and y is the student’s adjusted test score. If the standard deviation of the original test scores of the students in the class was 20, what was the standard deviation of the adjusted test scores of the students in the class? Send your guesses to vyomesh@wallstreetoasis.com Wise Investor Says 🤓 “I personally have said many times I'd be a hundred percent in equities. That fits my risk profile and my views of the world, though obviously it's not appropriate for everyone. Most investors need a more diversified portfolio.” — Larry Fink How Would You Rate Today's Peel? 😁[All the bananas]( 😐[Meh]() 😩[Rotten AF]() Happy Investing, David, Vyom, Jasper & Patrick [ADVERTISE]( // [WSO ALPHA]() // [ACADEMY](=) // [COURSES]( // [LEGAL]( [Unsubscribe]( IB Oasis Corp. (aka "Wall Street Oasis") 14435 Big Basin Way PBN 444 Saratoga, California 95070 United States