Facebook Raked In Over $6 BILLION In Ad Revenue In The Second Quarter

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“Using the network as his own private fiefdom” — Breitbart journalist Milo Yiannopoulos, with some harsh words for Twitter CEO Jack Dorsey. The controversial editor was banned from Twitter last week for allegedly encouraging online harassment, but he feels Dorsey’s just trying to promote his own political agenda. It’s getting heated.

MARKET SNAPSHOT

Big Picture

  • U.S. markets closed mixed yesterday after the Fed decided not to raise interest rates and major earnings reports continued to roll out
  • Asian stocks climbed after Japanese Prime Minister Shinzo Abe approved a $265 billion stimulus package to help invigorate the country’s lagging economy

Alternatives to Watch

  • After the Fed’s announcement, gold prices initially fell but quickly spiked to two-week highs, since low interest rates make the commodity more attractive

CORPORATE PRIMER

Facebook Keeps Rolling

…First Messenger, now earnings. After Messenger hit the one billion users mark last week, Facebook reported quarterly earnings and revenue yesterday that blew away analysts’ estimates. How is the social network still crushing it? Facebook raked in over $6 billion in ad revenue in the second quarter, and saw mobile ad revenue spike 81% year over year. Ca-ching. Plenty is in store for Zuckerberg and Co., as the social media powerhouse continues to develop live video, virtual reality and messenger chatbots.

Get Your Popcorn Ready

…Google just announced the launch of “Family Library.” Google’s latest service means that you and up to five family members can share everything—including music, movies, books and apps—across Android devices, smart TVs and tablets. Isn’t this just Google’s halfhearted response to Apple’s Family Sharing? Not exactly. Family Library goes beyond just Google’s own devices, as any smart TV, iOS device and possibly gaming console can be integrated with this plan. Pretty sweet.

Deutsche Bank

…Black sheep of Wall Street. “The world’s riskiest bank” posted an abysmal earning report yesterday, recording an absurd net income of $22 million—98% less than last year. 98 percent, people. Low interest rates, economic slowdown and political uncertainty in Europe all ganged up on Deutsche, which saw its biggest losses ever in its investment banking and sales and trading divisions. The German bank fell almost 4% yesterday to under $14 a share. Last time shares were this low? How about 1976.

U.S. MACRO

Still No Rate Hike

…But maybe next time. After meeting yesterday afternoon, the U.S. Federal Reserve announced that interest rates are staying put. But don’t start thinking rates will stay unchanged forever. Janet Yellen and Co. cited a notable uptick in job gains among other good-looking market indicators that suggest a growing chance of seeing a rate hike this year. Up next? The Fed will meet again in September in another two-day policy meeting.

OTHER STORIES

  • SABMiller halts merger process with AB InBev
  • Tumblr users will soon see ads on their blogs
  • *[Harry Potter and the Cursed Child](http://www.cnbc.com/2016/07/27/harry-potter-and-the-cursed-child-script-breaks-pre-order-records.html) *script breaks pre-order records
  • McDonald’s to create 5,000 jobs in the U.K.

ECONOMIC CALENDAR

RESISTANCE IN RIO

The Opening Ceremony is set to take place next Friday, but it seems that problems with the Rio Olympics keep piling up. According to a recent survey from the Ibope Polling Institute in Brazil, the majority of Brazilians expect the Olympics to do more harm than good for their country. Let’s dive into the numbers:

  • The poll shows that 60% of Brazilians predict the Olympics will generate more losses than gains for their country. On the other hand, only 32% of respondents saw the games being beneficial for Brazil.
  • Brazilian sentiment has changed a lot since hosting the World Cup in 2014, as only 40% of Brazilians thought hosting the soccer tournament would be detrimental, while 43% believed the soccer tournament would be salubrious to their country. That poll was clearly before that disastrous semifinal between Brazil and Germany.
  • Despite general pessimism, over 500,000 tourists and athletes are projected to arrive in Rio for the Olympics. That’s nearly 10% of the city’s population.
  • The main reason for the negativity? It’s not just the Zika virus. In June, the Brazilian federal government had to give Rio a $900 million bailout for the Olympics.

INTERVIEW QUESTION OF THE DAY

Two planes take off at the same exact moment. They are flying across the Atlantic. One leaves New York and is flying to Paris at 500 miles per hour. The other leaves Paris and is flying to New York at only 450 miles per hour (because of a strong head wind). Which one will be closer to Paris when they meet?

(Answer)

BUSINESS TERM OF THE DAY

Fallen Angel — a term used for bonds that were given an investment-grade rating but have since been reduced to junk bond status due to the weakening financial condition of the issuer. It can also be used for stocks that have fallen substantially from all-time highs.

FOOD FOR THOUGHT

Apple CEO Tim Cook announced yesterday that the tech giant sold its billionth iPhone last week. Cook isn’t wrong that the iPhone has truly become “an essential part of our daily life and enables much of what we do throughout the day.”
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