Good Coaches are always needed…
In every category of innovation, education, and business – you will find that all of the top tier performers have coaches. Early on, we were all taught to pay for coaching in the form of teachers. We choose a higher educational facility based upon their coaches / faculty. Every team has coaches. Many of the top performing CEO’s think of themselves as coaches, teachers, and educators. In fact, I can’t think of a successful individual that doesn’t come with a coach / mentor. So, we start and end with coaching, but somehow during that early to middle business ladder career path – coaching becomes the exception and not the rule - potentially because:
- Business coaches have failed to lay out clear goals, accountabilities and rewards,
- Workers view ‘increased productivity’ as simply a ‘rinse-n-repeat’ process,
- Business coaches often over-promise and under-deliver, and
- Workers have difficulty identifying the right coach – right task – right time.
The need for good coaching will only be enhanced with the continued shift away from selling our time to: working from home, self-directed tasks, and focusing on projects. Companies will only trust you after they’re convinced that you are one of those few people who can lean outside of their comfort zone, and bring back something extraordinary. Until that time comes, everything you do will be measured relative to a specific road map. The good news is that every road map needs a coach & navigator to make sure you get there on time and on budget.
Often the individuals that could benefit the most from coaching, are hesitant due to the amount of time required for: goal-setting, accountability, and reward management. Sometimes seeking a coach could be viewed as a sign of weakness. And then there’s paying for the coach – which almost always needs to come out of your own pocket. Combine all of these, and it’s a wonder that anyone (working their way up the ladder) has a coach at all. Which brings us back to the paradox: the elements that hold us back from getting a coach – are the very same reasons we need one in the first place.
The Market:
1. Remember inflation? That’s ok – nobody does, but you will. A year of 12% to 18% inflation will make the following 2 tweets a lot funnier:
a. A 27-year-old from San Fran w/ $80k in crypto said: “I’m pretty well off, so I might try and retire in 5 years.”
b. A 65-year-old farmer from the Midwest with $27m of land and $4m / year in crop revenue said: “It ain’t much, but it’s honest work. I don’t think I’ll ever be able to retire.”
2. As almost always happens when investors chase the hot hand, Cathie Wood’s ARK Innovation fund’s stocks were pummeled as of late with: TSLA -28% off ATH / SQ -17% off ATH / COIN -48% off ATH / SPOT -36% off ATH – you get the drill.
3. Inflation is scaring and confusing investors:
- +53% of adults get ‘anxious’ over discussing their financial situation,
- 44% of adults say discussing finances is ‘stressful’,
- 66% of American families do not have 6 weeks of expenses in savings,
- 78% of adults live paycheck-to-paycheck,
- 80% of people under 35-years-old cannot ‘pass’ a financial literacy exam,
- And 54% of millennials are concerned about their student loan debt.
4. Most people believe... they will never be able to build a financial future because they’re not going to inherit anything, and they don’t have a large salary. Factually:
- Over 80% of millionaires inherited $0, and
- Over 1/3 of all them never made over $100,000.
5. When investors are told... that financial freedom simply requires education and discipline == +80% say that they would rather play the lottery or bet on the game.
InfoBits:
- This week Virgin Galactic came even closer to taking paying customers. They have 600 ticket reservations at $250,000 each – giving Virgin another $150m to perfect it’s in-flight snack and movie offerings.
- Disney’s Black Widow picked up over $215m at the box office… and another $60m in streaming revenue in its opening weekend. Same-day streaming releases became a staple during the pandemic, and services such as HBO Max, turned them into a benefit for their highest-tier subscribers.
- The world is experiencing ‘shrink-flation’… where the price stays the same, but the portions get smaller. Check out your favorite grocery and restaurant.
- Space startups raised $7B in 2020… double what they raised in 2018.
- ByteDance, the Chinese owner of TikTok… has put on hold its intentions to list its stock offshore – after government officials told the company to focus on addressing data-security risks.
- Microsoft has agreed to acquire RiskIQ… a cybersecurity start-up.
- Warner Brothers just released a collection of 91,000… limited-edition NFTs from the movie: “Space Jam: A New Legacy,” including Bugs, Porky & LeBron James.
- Baggier fits made up almost half of Levi’s sales last quarter. People are no longer fitting into last year’s clothes, and that means = wardrobe change.
- G20 leaders are moving forward… with the biggest overhaul of the international tax system in decades (meaning: higher taxes for big companies).
- Global coffee prices are soaring… as Brazil faces one of its worst droughts in almost a century – leading to a plunge in java supply.
- An unopened Super Mario 64 game from 1996… just sold for $1.6m.
- “Grills just wanna have funds”... The Weber grill company is taking its charbroiled stock public – seeking a $6B valuation. Weber's sales are up 62% YoY.
- Apple will introduce Apple Pay Later… allowing consumers to buy any Apple product in installments over time. Goldman will be Apple’s lender for the loans.
- Amazon just acquired a +12 person team of wireless experts from FB… in an effort to boost its effort to launch thousands of satellites and offer global broadband service.
- Legal US cannabis sales could top $30B by 2022.
- LG invests $5.2B in batteries, but it's more than EVs… utility-scale batteries are a new massive opportunity for our renewable energy infrastructure. They solve the "intermittency problem" for everyone setting ambitious carbon-reduction goals. Energy storage = $426B market in next 10 years.
- What’s Netflix’s response to slowing growth… break into gaming. They will offer games alongside TV shows and movies at no extra charge.
- Aurora Innovation (a self-driving vehicle startup)… is going public via SPAC at a $13B valuation. It promises autonomous vehicles by 2023.
- Boston Beer (maker of Sam Adams beer)… just discovered the canned cocktail. It’s only been the fastest growing drink segment in the US for a while now.
- Lordstown Motors (electric-truck startup)… confirmed that the Justice Department is probing its business, investigating all matters related to its SPAC and all preorders for its forthcoming pickup truck – the Endurance.
Crypto-Bytes:
- Fidelity Digital Assets plans a 70% increase in headcount… in anticipation of growing institutional demand for crypto services.
- Worri Financial Group (one of S. Korea’s largest banks)… is getting into digital asset custody through a joint venture with Coinplug.
- The Bank of Ghana (BoG)… wants to pilot its own central bank digital currency within 2 months.
- Hive Blockchain has purchased over 3,000 bitcoin miners… which is expected to increase its operating hash rate by 46%. The purchase should generate an additional $80k in daily income.
- Grayscale’s Digital Large Cap Fund… is now an SEC reporting company.
- There’s a $175m uniform deal… between Crypto.com and the UFO (Ultimate Fighting Championship). Crypto.com’s logo will be printed on in-Octagon gear and presented during walkouts to advertise and generate crypto awareness.
- BIT Mining (a Chinese bitcoin miner) raised $50m… to build a new data center and relocate their machines to Kazakhstan.
- The Bank of England is worried about potential crypto spillovers… disrupting mainstream financial markets.
- For the first time this year, cryptocurrency futures and options… have surpassed the number of coins traded in spot markets.
- The European Central Bank will move from discussion to exploration… in its plans to develop a digital euro. This exploratory phase will last 24 months.
- Compass Mining has signed a deal with a nuclear fission startup… to supply the bitcoin mining company with 150mw of clean / cheap energy.
- To SPAC, or Not to SPAC… is the only question that BlockFi, Ripple, and Kraken are asking as they all plan on going public very soon.
- Greenidge Generation Holdings (a bitcoin mining firm)… is acquiring 8,300 rigs in a new partnership with Foundry. Greenidge also plans to expand into South Carolina and go public through a merger with IT firm Support.com.
- There are +100m cryptocurrency users worldwide… We are long past the stage where generalizations about crypto are intellectually useful, but politicians continue their barrage.
The Last Weeks in Crypto:
The past weeks have been rough for Bitcoin and Ethereum. Both are down more than 50% from prior peaks, leaving crypto maximalists in confusion. The Crypto Bears are looking for Bitcoin’s June ‘death cross’ to lead it lower. A ‘death cross’ happens when an asset’s short-term moving average falls under its long-term moving average. The Crypto Bulls (on the other hand) believe that a crypto break out is in the wings because BTC’s Bollinger Bands are at their tightest point since September, 2020. All that really means is that we have increased crypto volatility, crypto’s trend is downward, but strong support and relative strength could give us a bounce. The good news is we should have answers to the next directional move soon - after all:
- Volatility is tightening
- 18% of Bitcoin’s supply is moving in the $31K to $40K range,
- Price diverges from on-chain flows as re-accumulation continues,
- Miners are accumulating again,
- Whale holdings are sideways, and
- More all-time-highs as net user growth continues to grind higher
Marijuana and Alcohol: Who knew?
MJ Reform: Chuck Schumer's much awaited cannabis reform bill was finally introduced into the Senate. It is currently a draft, with a public comment period open until September 1st, before it will then be formally introduced. It is called the Cannabis Administration and Opportunity Act. Some of its efforts include:
- Federally DE-scheduling cannabis, with a requirement that the AGs remove marijuana from the Controlled Substances Act within 60 days of the bill's enactment.
- Maintaining state’s rights such that if a state wants to keep cannabis illegal, it can.
- It transfers regulatory authority to the FDA and other agencies. That would eliminate all of this ‘limited’ licensing – with license approval being granted if satisfying FDA requirements. Cannabis products would not be regulated as dietary supplements, but manufacturers can make claims about benefits.
- Interstate commerce would be allowed, and I would expect that most growing would move West of the Mississippi.
- A gradually increasing federal tax would begin at 10%, and then by year five be 25% of sales. Small businesses would be eligible for a 50% reduction in the tax rate.
- The bill would mandate expungement of prior cannabis convictions, allowing people to petition for resentencing, and there would be 3 grant programs under the bill for this purpose.
Direct-to-Consumer (DTC) Spirits:
- 80% of consumers believe distillers should be allowed to directly ship their products to legal-age consumers in any state.
- +76% would consider purchasing spirits online shipped directly from distillers to them from outside or within their state.
- 75% agree that wine and spirits should be subject to the same laws pertaining to DTC across states.
- 45% have already purchased alcohol online direct from a brewery, winery or distillery.
- 38% have already purchased alcohol online from an out-of-state producer.
- 73% shop online for groceries, and 47% shop more frequently than in the past.
- 62% have purchased alcohol online with the split being: 32% spirits, 33% wine, and 31% beer.
Next Week: Inflation is scaring this market…
Back in 2009, Warren Buffet said at Berkshire Hathaway’s annual shareholder’s meeting: “The best thing that everyone can do to protect against inflation, is to sharpen their own skills and work to be the best in your field. If you’re the best teacher, if you’re the best surgeon, if you’re the best lawyer – you will get your share of the national economic pie regardless of the value of whatever the currency may be. In other words, being great at what you do will ensure that you receive your fair share, no matter what is happening with the value of the dollar. Ultimately, the best thing to do is invest in yourself. The next-best course of action to protect against inflation, is to own a part of a wonderful business. That’s because no matter what happens with the value of the dollar, the business’ product will still be in demand.”
Market Update: Inflation is scaring the be-jesus out of this market, and should continue to do so for some time. We have not seen this level of inflation for decades, and at this point the genie is out of the bottle and our FED can no longer control its direction or outcome. Tip #1 = RAISE SOME CASH: I’ve been doing that over the past 2 weeks. In a nutshell, I still like crypto and commodities, but I’m not sure I can like much of anything else. I’m watching the bonds rally (interest rates decline) in the face of 12% inflation, and am just wondering WHEN (not IF) we begin a substantial market correction.
- Our markets SOLD-OFF into dovish FED speak: This means that all the time J. Powell was telling the Senate that (a) inflation is transitory, and (b) he would keep ‘accommodative monetary policy’ in place as long as it takes == big-money was in complete dis-belief as bonds rallied and markets sold-off hard. This is one of the first times that markets told Mr. Powell that he’s on the wrong side of the trade, and what they’re really signaling is: slower growth.
- Tip #2 = a MAJOR PRICE VOLATILITY IS COMING especially within the Nasdaq. We are currently at one of the lowest points of historical volatility within the Nasdaq, and this market is 1% off it’s all-time-high. That’s a natural recipe for moving fast and moving large.
- Markets are in transition. Nobody knows what this will look like on the other side (what the FED has up-its-sleeve), but everyone agrees that it will be met with extreme volatility. The VIX (volatility index) has yet to really rise, but the VVIX is signaling that it will get there in the very near future.
- Tip #3 = Bonds are inefficient and the implications of their rally are only beginning to materialize. Every week Bonds are either smashing through or touching their expected move. Because of that action, we should continue to see downside pressure on the financials and on energy. Financials and energy are what drove this market to new highs, and if we require ‘tech’ to take the baton – that transition will be a rocky one. And rates moving lower this quickly will absolutely damage the financials.
- Why are the bonds rallying?
o If there is inflation, shouldn’t the bonds be selling-off in order to curb some of that inflation?
o Is there just so much cash out there that we simply need to put ‘some money’ into every single asset class?
o Is big money moving toward bonds because everything else is so over-priced?
o OR Tip #4: Are the bonds telling us that inflation will slow growth, and your safest bet under a slow-growth scenario are bonds?
o Nobody is paying enough attention to the sheer magnitude of the moves within bonds, and a small move in bonds – goes a long way to influencing market behavior.
- Beware of percentage moves in the QQQ and SPX. In the short-term, I’m looking for a 3% move in the SPX (120 points) and/or the Nasdaq (500 points) in order to get everyone’s attention. That’s what a rise in volatility above 130 on the VVIX, and a bond rally will get you. That should cause a ripple that will start in the financials and energy, and lead right thru the technology sector. This next week should be a ‘calmer’ week for earnings, with the ‘monsters of tech’ coming the week after next.
Expected Moves:
- Last week we were looking for a $61 (expected move), and next week the S&Ps are expected to move $74. I’m looking for movement of $120 in a day, so expect considerably more volatility going forward.
Tips:
HODL’s: (Hold On for Dear Life) == Spent this week raising CASH:
- AMC – Holding
- Bitcoin (BTC = $31,800 / in at $4,310)
- Bitcoin Cash (BCH = $440 / in at $170)
- Peabody Energy (BTU = $8.80)
o Sold Aug $10 CCs for income
- Electramericcanica Veh (SOLO = $3.56)
o Sold Sept $4 and $5 CCs for income
- Express Inc (EXPR = $4.52)
o Sold August $5 CCs for income,
- Ethereum (ETH = $1,900 / in at $310)
- Franks International (FI = $2.56)
o Sold Oct $5 CCs for income,
- GME – Holding
- Grayscale Ethereum (ETHE = $17.79 / in @ $13.44)
- Grayscale Bitcoin Trust (GBTC = $26.20 / in @ $9.41)
- Grayscale Trust (GDLC = $24.10 / in @ $22.75) & buying
- Hyliion (HYLN = $9.33 / in @ $0.32)
o Sold Aug $11 CCs for income
- Infinity Pharma (INFI = $2.56)
o Sold Aug $3 CCs for income
- Litecoin (LTC = $120 / in @ $191)
- Tellurian (TELL = $3.66)
o Sold Oct $5.5 CCs for income.
Thoughts:
Follow me on StockTwits.com to get my daily thoughts and trades – my handle is: taylorpamm.
Please be safe out there!
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