Win Some, Lose Some

The US labor market showed signs of balance with job openings at their lowest since March 2021... [The Daily Peel... ]() August 30, 2023 | Peel #533 Silver banana goes to... [MBA Tours. ]() In this issue of the Peel: - Markets surged with PDD Holdings and Tesla showing big gains, while the VIX and Hawaiian Electric took hits. - The US labor market showed signs of balance with job openings at their lowest since March 2021, possibly due to effective interest rate hikes. - US Appeals Court ruled in favor of Grayscale for a spot BTC ETF, indicating potential regulatory shifts towards digital assets. Market Snapshot Happy Wednesday, apes. I don’t know what you all did yesterday, but I heard there was actually someone on the streets of New York with a smile on their face at one point; markets must be up. And, oh boy, they were. 446 S&P 500 names were up on the day, and with that, the index posted a gain of 1.45% on the day. It feels like JPow was making it rain all over us again. The Nasdaq posted an even bigger day, rising 1.74%. Every sector was up, every portfolio was up, and best of all, every mood was up. Then, there came treasury yields. Those, on the other hand, were very down amid all the envious green going down on the equities side of things. The 2-year plopped down and bounced off 4.9% like a trampoline, while the 10-year fell almost as far as 4.1%. Hey, regardless of the asset, buying is buying, right? Let’s get into it. Harvard, Berkeley Haas, Yale, Duke, & More Want to Meet You! [image]( Calling all business school aspirants that want to fulfill their dreams of getting an MBA! [The MBA Tour Spotlight on Women in Business Virtual Event](=) is back on September 14th from 6:00 PM - 8:30 PM Central Europe Time to connect qualified candidates like you with leading business schools from around the world! Why should you attend this virtual event? - Connect with Leading Business Schools: Network directly with members of their admissions teams, gain insights into their programs, and get your questions answered by the professionals. - Access to Expert Advice: Get your resume professionally reviewed and learn how to make your qualifications stand out. - Thought-Provoking Presentations: Attend program-specific MBA Talks to learn more about the unique features different schools have to offer. - Network with Your Peers & more! Don't wait any longer to start your journey to business school and boost your career - join us on September 14th! [Register Now]( Macro Monkey Says JOLT-ed Into Balance To paraphrase an esteemed, dignified, and all-too-well-known Seinfeld character, “No job for you!” Such a way with words. While maybe slightly exaggerated, this particular character was describing the 2023 US labor market. Yesterday, we got the July JOLTS (Job Openings and Labor Turnover Survey) report from the Labor Department, and this time, the big headline is: Job openings haven’t been this low since March 2021. "Job openings declined to 8.8mn last month, a decrease of 338k ..." Job openings declined to 8.8mn last month, a decrease of 338k potential workers and high-wage demanders, allowing Fed Chair JPow and market watchers a world over to finally let the tiniest bit of oxygen out of their lungs. 8.8mn might be the lowest in years, but coming off of that 12.02mn bender we hit in March last year (the exact same month Powell and FOMC began raising rates), we’re still well above the extremely nice 6.99mn in the pre-pandemic days of February 2020. Maybe, just maybe, interest rate hikes are starting to do their thing. Remember that whole “monetary policy works on a log and variable lag” thing? Maybe people were onto something. Of course, it could be a coincidence as well, but add another feather to the cap of team “soft landing” because that’s what the headline data suggests. While job openings declined to a multiyear low, unemployment remains at 5.8mn, still just ~66% of the number of available jobs. It might not be ideal, but the graph below from the WSJ shows why JPow and Wall Street were dancing at their standing desks yesterday: [image] [Source](=) Basically, the market took this data as further evidence that the labor market is headed in the right direction. Unemployment has barely ticked, but like in golf, recall that that’s a good thing. With that, it could suggest the Fed’s existing rate hikes have served their nation with honor, and further reinforcements may not be necessary and/or inevitable. "... it could suggest the Fed’s existing rate hikes have served their nation with honor ..." Purely coincidentally (of course), the probability assigned by the market to holding rates steady at the current 5.25% - 5.5% level jumped 8% on the day to ~87%. Thankfully, a new month begins on Friday, meaning we don’t have to wait too long to get the big dawg August Jobs Report we’ve all obviously been dying for. We’ll see you then, and hopefully, our portfolios still look this fat. What's Ripe PDD Holdings (PDD) ↑ 15.43% ↑ - Yeah, I had to do a double-take on this one too. The company formerly known as “Pinduoduo” changed its name back in February, and based on yesterday’s price move, it’s clearly working out. - Bucking the “China’s economy is going to hell” trend that mainstream media (and we) have been hyping up, the online marketplace formerly known as Pinduoduo blasted through expectations on strong consumer spending and sentiment. - EPS of $1.44/sh beat easily, but the nearly 20% beat on sales, clocking in at $7.2bn vs. $6.13bn expected. Maybe it’s not all thunderstorms and lightning over in the Middle Kingdom. For one company, at least, we can confirm it’s not. Tesla (TSLA) ↑ 7.69% ↑ - In 2023, there are few things that’ll move shares more than this dynamic duo. AI + Elon Musk = one helluva green day. - Don’t trust our math? (I wouldn’t). But thankfully, you don’t have to, as shares boomed almost 7.7% yesterday. Elon’s car company announced they’re launching something called an “AI computing cluster.” - Without having to kick my own a** at the end of this for being too nerdy, just know it’s basically a $300mn supercomputer the company has decided to launch. With 10,000 Nvidia H100s powering this thing, that makes it “more powerful than the world’s third highest performing supercomputer.” - Not bad. The idea is that this investment should accelerate the development of things like FSD (full self-driving), which Elon & Co. have been hyping up since ‘Nam. Personally, I think they were just jealous of Nvidia stealing all of Mr. Market’s attention. What's Rotten CBOE Volatility Index (VIX) ↓ 4.18% ↓ - With a combination of interest rate optimism, strong jobs data, and good ol’ fashioned monkey-see, monkey-do, every single stock on Earth was up yesterday. - If your portfolio fell, kindly go take an IQ test and make sure this is right for you. Unless you held exclusively the VIX and the dogs*t below, you’re alright. - As a reminder, the VIX trades on expected volatility over the next 30 days based on options chain flows tied to the S&P 500. Clearly, after yesterday’s super rally, there wasn’t much concern. We’ll see how long that holds out. Hawaiian Electric (HE) ↓ 4.65% ↓ - Thank God this thing decided to fall today. I don’t know what the hell else we would’ve written about (sorry, Patrick). - Anyway, shares in the utility company that may or may not be responsible for at least 115 deaths turned around from Monday’s bump as investors likely rotated into shares of companies that aren’t actively engaged in murder lawsuits. - We’re still in the he-said-she-said days of this sure-to-be-long legal battle, but for now, betting on daily moves might be the financial equivalent of driving with your eyes closed: Yeah, you look super cool doing it, but are you really okay with being wrong on this one? Thought Banana SEC: 10,782,467 vs BTC: 1 It might not be a great record, but that 1 recently bestowed upon BTC sure felt good yesterday. For the first time in what feels like forever, US officials have taken a step closer to approving a spot BTC ETF. Is this what it is to truly be an American? Freedom, that’s right. On Tuesday, a US Appeals Court in Washington, DC, ruled in favor of Grayscale, the owner and manager of the (in)famous GBTC ETP, and against the SEC in the Commission’s denial of Grayscale’s application to convert GBTC into an ETF. According to the DC court, the SEC’s basis for denial did not have legal standing, particularly when compared to other approved BTC ETPs, such as BTC future ETFs like ProShares’s BITO. "... the SEC’s basis for denial did not have legal standing ..." Needless to say, it’s a huge win for a lot of players. For starters, BTC and ETH prices popped off in response, while Coinbase, listed as the custodian for several large spot BTC ETF applications, saw its stock soar over 14.9% on the day. Speaking of large spot BTC ETF applications, Fidelity and BlackRock must be pretty happy, too. Two of the world’s largest asset managers have in 2023 applied for approval to list these products, but these rulings have mostly been put on ice. Their track records gave investors more hope, however, given BlackRock’s 574-1 record of approvals/denials for all of their ETFs. "But maybe it’s time we give the SEC some credit." But maybe it’s time we give the SEC some credit. If BTC and digital assets really are going to be as hugely impactful as they claim to be, it’s rational for a regulator to place extra-heavy scrutiny on the asset. Especially when the goal of that asset is to, you know, disrupt the entire modern financial system and a core, fundamental, borderline instinctual way of life that works pretty damn fine most of the time anyway. Our salaries and national security depend on the US Dollar, so making sure this sh*t is legit makes sense. Plus, it is the explicit job of the SEC to protect investors. They can’t protect unsophisticated buyers if they themselves are also unsophisticated. It’s only 2023; maybe it’s okay if we take our time to get it right. But still, f*ck Gary Gensler, of course. The big question: Will we see a spot BTC listed in the coming months? Who will be the biggest winners and losers? Banana Brain Teaser Yesterday — What does this mean? cHIMp Answer: Making a monkey out of him. Today — When you behead a word, you remove the first letter and still have a valid word. You will be given clues for the two words, longer word first. Example: Begin -> Sour, acidic Answer: The words are Start and Tart. - Percussion instrument -> Distilled spirit from sugarcane - Unit of musical rhythm -> Consume - Property of sound based on frequency of vibration -> Rub; urge - A note raised by a semitone; crisp -> Angelic instrument Shoot us your guesses at vyomesh@wallstreetoasis.com. Wise Investor Says “The future is never clear; you pay a very high price in the stock market for a cheery consensus. Uncertainty actually is the friend of the buyer of long-term values.” — Warren Buffett How would you rate today’s Peel? [All the bananas]() [Decent](=) [Rotten AF](=) Happy Investing, Patrick & The Daily Peel Team Was this email forwarded to you? [Be smart like your friend.](=) [ADVERTISE]() // [WSO ALPHA]() // [COURSES]() // [LEGAL]( Don't want The Daily Peel? [Unsubscribe here](). Click to [Unsubscribe]( from ALL WSO content IB Oasis Corp. (aka "Wall Street Oasis") 20705 Saint Charles St Saratoga, California 95070 United States