Fed Backs Away From Rate Hikes; Facebook CRUSHES Earnings Estimates; Facebook And Google Take Advantage Of Apple
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FED GONE MILD
To put it lightly, Jerry Interest Rates seemed to have a change of heart at his post-FOMC-meeting presser stressing that the case for hiking rates has “weakened” while not exactly acknowledging proposed 2019 rate increases. And the FOMC’s post-meeting statement didn’t offer much color either … on the surface at least.
In it, the Fed dropped all references to future hikes, meaning the year of our Lord 2019 may be the first since 2015 without a Federal Funds Rate increase. Citing an expanding economy the committee noted that it would be “patient as it determines what future adjustments” are appropriate.
The Feds other lever for safeguarding the economy, its $4T balance sheet, has been a hot button issue as of late. But the boys in beige were equally indecisive about this, claiming they were “prepared to adjust any of the details for completing balance sheet normalization in light of economic and financial developments.”
Read between the lines
Unpacking Powell’s alleged indifference uncovers a glaring truth: the Fed is trying to distance itself from rate hikes in 2019 … while leaving its options open should sh*t hit the fan.
Some are saying that Powell and the dream team at the Fed are catering to markets when they should be focusing on true economic data. Either way, stocks rose swiftly following the Fed Chair’s remarks.
EARN BABY EARN
Zuckerbot and the gang posted a record profit of $6.9B (nice) in Q4 due in large part to revenue that rose 30% to $16.64B. This was mostly driven by continued digital ad dominance. Shocker, “Watch” isn’t a cash cow. This looks even more impressive when you consider that Facebook faced (another) massive privacy issue that involved sharing data with more than 150 companies through apps even after users had opted out.
At the close yesterday the stock remained near its lowest point in two years, having lost a third of its value since the beginning of Q3. Following the earnings beat announcement after-hours, shares were up nearly 11.5%.
Fly, pelican, fly
Facebook wasn’t the only company making power moves only (sorry, Tesla).
Boeing reported $101.1B in annual revenue, marking the first time the company finished north of $100B in its 103 year history. The big old jet airliner manufacturer delivered a record 806 aircrafts last year but looks to best that figure with an aggressive forecast of 895 to 905 deliveries in 2019.
Fourth-quarter earnings and revenue were $5.48 per share and $28.3B respectively, beating estimates by 91 cents and $1B per share. The stock was up 6.6% on the beat.
THEY CAME IN THROUGH THE BATHROOM WINDOW
First things first. Listen to this song while you read this article.
Apple revoked Facebook’s enterprise certificate which allows the company to distribute apps via the App Store internally (read: not to customers) for testing purposes. Giving zero f*cks about the “rules,” Facebook had been distributing data collecting apps to consumers. The Social Network was paying customers to download the app which allowed the company deep-level access to the user’s phones. That’s some Black Ops sh*t.
To add to the betrayal, Google was found to be doing the exact same thing with an app called Screenwise Meter. Fool me once, amiright?! The tech giant had apparently been skirting Apple’s policies since 2012 when it began letting users earn gift cards by sideloading Enterprise Certificate-VPNs that tracked their phone activity and web history.
According to a TechCrunch report, Google was more forthcoming with their users on how the program worked, but both techniques slipped through Apple’s monitoring … a lot like that FaceTime bug did.
Meanwhile, in a hilariously tangential turn of events, H&M brought on Christopher Wylie, who was the Cambridge Analytica whistleblower, to run its data analytics program. LOL!
IN OTHER NEWS
- For a guy who really hates the SEC and short-sellers, Elon Musk sure does seem to give a damn about what Tesla investors think about him. Case in point: Musk cut some 3k jobs a few weeks back in an effort to ensure profitability going forward. Tesla which announced profitability for the second quarter in a row, fell short of analysts expectations, sending shares down after hours.
- Oh, and did we mention that the EV company’s CFO is leaving? In what appeared to be an afterthought, Elon Musk threw in the retirement announcement just as the earnings call was winding down.
- If Wall Street banks were ‘Friday Night Lights characters,’ Goldman Sachs would be Tim Riggins: the pretty, but edgy dude who lives in the gray area of the law. For the record, Deutsche Bank is Jason Street post-accident. United Natural Foods filed a suit against Goldman, claiming the firm improperly extracted more than $200M in fees on the company’s $3B takeover of Supervalu.
- This oughta help cryptocurrency shift public perception. Hamas, a Palestinian group designated as a terrorist organization has taken to Instagram to ask for donations … via cryptocurrency. The militant group can’t be too happy that a single bitcoin has fallen from a high of over $19k in 2017 to less than $3.5k today.
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