“I just find that an extraordinarily premature conversation to be having” — William Dudley, President of the Federal Reserve Bank of New York, in response to all the talk about negative interest rates. Negative rates might be premature, but Fed Chairwoman Janet Yellen hasn’t ruled them out.
- U.S. stocks broke a five-day losing streak on Friday, with the beaten-down financial sector shooting up and investors reacting to newly released economic data (both retail sales and consumer confidence inched slightly higher)
- Meanwhile, European stocks kicked off the week with a strong showing across the board to continue Friday’s momentum (also led by financial stocks)
Alternatives to Watch
- Oil posted its strongest performance since 2009, leaping 13% as OPEC closes in on an agreement to cut production
- China’s currency, the yuan, was up 1.3% on Monday versus the U.S. dollar in a massive move (its largest since 2005), which occurred after China released comments supporting its currency—nonetheless, it remains near multi-year lows
- The share buyback strategy we’ve been seeing a lot of lately extended to JP Morgan, where CEO Jamie Dimon bought back $26.6 million in company stock—sending shares over 8% higher
- Payments processor Square (run by Twitter CEO Jack Dorsey) surged 8% on Friday after Visa disclosed a 10% stake in the company
Abenomics Loses Traction
Japan released its fourth quarter GDP yesterday. Prognosis? Negative: Japan’s economy contracted 0.4% last quarter, capping off an even uglier 1.4% contraction for 2015. A shrinking population, weaker domestic demand and Prime Minister Shinzo Abe’s failing “Abenomics” plan simply isn’t encouraging Japanese citizens to spend money. But with the bad comes the good: after a decline in the markets last week, Japanese stocks bounced back to kick off this week over the possibility of even more markets-boosting stimulus from Abe.
Rolls-Royce Hits Turbulence
British engine maker Rolls-Royce (don’t confuse it with the flashy cars—the two are separate now) had an interesting quarter. A 20% increase in profits for the year was overshadowed by the company cutting its dividend. Executives also made it clear to investors that 2016’s outlook isn’t bright due to, you guessed it, slumping oil prices. Oh, and by the way, Rolls-Royce is planning to expand into the civil aerospace sector this year. Add up the good (cutting costs!) with the bad (dividend cut!), and you get surprisingly happy investors: shares were actually up 16%.
HSBC Finds Middle Ground
HSBC gets the best of both worlds. The massive British bank decided yesterday to keep its headquarters in London instead of packing up and moving to Hong Kong. After 10 months of contemplating, executives realized that simply focusing its business more in Asia rather than moving there was more economical. The (unanimous) decision was centered on the economic growth that Asia offers…or used to, anyway.
- Dr. Dre is starring in a scripted Apple TV show about himself
- AT&T trialling 5G, promises speeds 10 to 100 times faster than LTE
- Google ramps up hiring for self-driving car project
- Kanye West tweets he is $53 million in “personal debt”
- Monday: U.S. Markets Closed (Presidents Day)
- Tuesday: Cheesecake Factory Earnings; Housing Market Index
- Wednesday: T-Mobile, Denny’s, Dr. Pepper, GoDaddy, Jack in the Box, Marriott International, NVIDIA, Priceline, Progressive Earnings; Housing Starts; Producer Price Index; Industrial Production; FOMC Minutes
- Thursday: Walmart, DISH Network, Hyatt Hotels, Nordstrom, Six Flags Entertainment, SodaStream, Starwood Hotels Earnings; Philadelphia Fed Business Outlook Survey; Weekly Jobless Claims
- Friday: Consumer Price Index
SUCKS TO BE SINGLE
Valentine’s Day weekend just finished up, and for those of us still on the market, it gets worse: online dating might be a bit riskier than you thought. That’s right, it’s prime picking season for fraudsters on dating sites who want to steal your info (and your heart)…and make money off of it. Here’s more:
- 20% of Americans aged 25-34 have used online dating sites—hence the $2 billion market.
- Unfortunately for those just looking for love, 1.26% of online dating transactions were fraudulent on Valentine’s Day in 2015. To put a dollar amount on that, compare that to 2014, when losses due to romance scams totaled over $86 million.
- So how does this happen? Fraudsters use the sites to collect personal info on users, which is then passed on to be monetized—and in case you’re tempted to point a finger at that Nigerian prince you’ve been chatting with, 18% of all online dating fraud originates in the U.S.
INTERVIEW QUESTION OF THE DAY
A car travels a distance of 60 miles at an average speed of 30 mph. How fast would the car have to travel the same 60 mile distance home to average 60 mph over the entire trip? (Answer)
BUSINESS PERSON OF THE DAY
Mikhail Fridman is the chairman of Alfa Group, Russia’s largest investment group, and has a net worth of over $13 billion. Fridman recently made a $200 million investment in Uber, citing the company’s extraordinary management team and vision towards the future of technology.
FOOD FOR THOUGHT
$4,625,496.70: Did you know that Martin Shkreli owes over $4.6 million to the IRS? This may come as a surprise considering he recently offered to buy Kanye West’s new album for a cool $15 million. Fishy much? You tell us.
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