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Belt Tightening 🥋

Belt Tightening 🥋

Amazon kills cashless stores + China lowers it's growth rate

autonomous
March 06, 2023

Good morning! I hope everyone had a great weekend.

I'm noticing a lot of belt-tightening moves from governments (China) and businesses (Amazon).

Let's jump in 🤾‍♂️🕳️

Key events to watch:

Corporate Earnings (T, W, Th, F)
JOLTS job report (W)
Jobless claims (Th)

TRENDS ✨

Electric vehicle sales have been accelerating, but while the cars may be emission-free, their manufacturing process certainly isn’t. (QZ)

🧿 This the house view as well. Tricky to invest in the idea though, with so much investor capital flowing into the space.

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Amazon to close its cashless stores in NY, SF, and Seattle (BBG)

🧿 Amazon is also pausing the completion of its HQ #2 in Virginia. These conservative moves give us the impression that AMZN is anticipating a consumer slowdown and behavioral changes.

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Twitter revenue is down 40% as of a year ago (WSJ)

🧿 Elon continues cost cutting and optimization of Twitter while looming mountains of debt put pressure on a business that is not producing.

Altria swaps its 35% Juul stake for some IP rights after the intital $12.8B investment lost ~98% in four years. (FT)

🧿 With regulators coming down hard on Juul and nicotine vaping, it is not surprising that Altria is looking to cut losses and move on. Anecdotally, here in NY I see more vapes than cigarettes on the street. We'll keep an eye on this.

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BIG PICTURE 🌎

Pivot: China set its lowest economic growth target in decades: 5%+ GDP (BBG)

🧿 I physically went to the Chinese Embassy in DC back in 2012 and a Chinese official explained to me that China cannot grow at a rate slower than 8.5% otherwise it would mean significant loss of progress and harm to the overall health of the state.

Lowering the required growth rate points toward an intentional slow down in global commerce or a harsh outlook. The PRC also indicated that it would prioritize military spending.

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US Citizenship and Immigration Services (USCIS) is increasing prices across visa applications. In some cases, prices will double (QZ)

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CHART DU JOUR 🥘

MEME DIGESTIF ☕️