💥 JetBlue's acquisition of Spirit crashes and burns

🧐 Plus, Davos rumbles on

Author

Wyatt from Alts
January 17, 2024

Good morning and welcome to Stocks and Income.

More of the stuff you like more often — every weekday morning at 6am EST to be precise. If this is too much, just smash the button below.

Last week, you got our inaugural issue of Institutional-grade options by Benedict Maynard. Make sure to subscribe if you want more like this - it’s half-price for a few more days.

In the meantime, I think traders betting on six rate cuts this year are smoking something. Check out how I’m going to play that if you agree.

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*past 24-hour performance

📰 Market Headlines

  • Markets were down slightly across the board yesterday.

  • The US Senate is getting closer to a spending bill that would avoid a government shutdown.

  • Asa Hutchinson dropped out of the US Presidential campaign.

  • China missed its Q4 GDP estimate. Bejing has resumed announcing youth unemployment numbers, which have unbelievably fallen from 20% to 14.9% after a “recalibration” of the survey’s methodology.

🕶️ Market Vibes

🎰 Market Forecasts and Futures

Despite a hot CPI print, traders still forecast a 66% chance of a rate cut in March. Kalshi is less optimistic at 40%.

I think there’s no chance unless CPI magically falls off a cliff next month, which is unlikely.

I’m going to put $50 on the No side of the March rate cut market on Kalshi. I’ll probably also load up on 0, 1, 2, and 3 rate cuts for 2024 via Kalshi.

[If you want to do the same, remember you get $25 free if you use the links above]

Finally, I’m working with Benedict to build a derivatives strategy to short bonds. In the meantime, I’ll load up on the triple inverse 7-10-year bond ETF over at public.com.

😱 Fear and Greed Index

🧠 What do you think?

With the US Congress come up with a deal to avoid a government shutdown?

Login or Subscribe to participate in polls.

🎤 What you said last time

Fairly tepid response here, so I don’t think there are strong feelings either way. We’ll find out this morning.

📈 Trends you need to know

Search results are from our friends at Glimpse, my favorite way to spot trends.

As investors aim to diversify portfolios and take a more passive approach, multi-cap funds, which invest across a wide variety of market caps, have exploded in popularity.

📊 Stocks

Want to invest like Buffet? With Public.com, you can emulate Berkshire Hathaway’s portfolio with just a few clicks.

Winners and losers

Earnings, upgrades, and acquisitions

  • Visa completed its acquisition of Pismo for a reported $1 billion.

  • JetBlue’s $3.8 billion acquisition of Spirit Airlines has been blocked. Spirit shares fell 47%.

  • Interactive Brokers missed earnings; shares fell 3%.

Market movers

  • Office loan delinquencies hit 6.5%.

  • Apple overtook Samsung as the world’s largest smartphone maker by volume.

  • More Google layoffs.

  • Bob Iger made $31.6 million as Disney’s CEO in 2023.

  • Fujitsu, neck deep in the UK post office scandal, will likely pay out millions in restitution. Shares are off 4%.

  • Shell is selling its offshore oil assets in Nigeria for some $1.3 billion.

  • Insuring ships through the Red Sea is getting a lot more expensive, which will flow through to bottom lines.

Ideas, trends, and analysis

🌍 Global Perspectives

🇰🇵 Anticipating a Trump victory in November, North Korean dictator Kim Jong Un is getting more belligerent.

🇨🇳 China’s population dropped for the second straight year.

🇮🇶 🇵🇰 🇮🇷 Both Iraq and Pakistan are protesting Iran’s air strikes.

🇬🇧 UK inflation rose unexpectedly.

📊 Income

📊 Crypto

  • The IRS says businesses don’t have to report crypto as cash.

🧠 Errata

  • The housing market may be more active than you think.

  • We’re no better prepared for a pandemic than we were five years ago.

  • A child died working in a Mississippi slaughterhouse. He was sucked into a chicken deboner. He’s the second to die in the factory in two years. The federal government prohibits the hiring of anyone under 18 in slaughterhouses because of the dangers of the job. The 16-year-old was illegally hired using the false identity of a 32-year-old man.

📺 What to Watch Today

That’s all for today. Did we miss anything? Smash the reply button to let us know.

Cheers,

Wyatt