Alchanati Campbell & Associates
Wall Street was very exciting today. The Feds went hiking, Elon Musk became richer, and Mark Zuckerberg got invited to the UK to meet Parliament.
The new Chairman, Jerome Powell, led his first meeting today. Fed officials declared a hike of 25 basis points (.25%) and forecasted a steeper path of hikes in 2019 and 2020. As interest rates rise, consumers tend to save as returns from savings are higher. With less disposable income being spent as a result of the increase in the interest rate, the economy slows and inflation decreases. Bond prices fall as interest rates rise. As interest rates move up, the cost of borrowing becomes more expensive. This means that demand for lower-yield bonds will drop, causing their price to drop.
Elon Musk received a performance reward of $2.6 billion stock-options over 12 tranches in 10 years. This reward is tied to Tesla hitting key milestones.
Facebook disclosed personal data on 50 million users, stock tanked 7% in the last 5-days. Mark Zuckerberg is being called before Parliament, and the U.S. Congress and the Federal Trade Commission also want a chat with Mr. Zuckerberg.
Amazon passed Alphabet (Google) in market share, now the 2nd most valuable U.S. listed company. Behind Apple.
Apple is secretly developing its own device displays. Apple is investing in the next generation of MicroLED screens. This move may have a negative effect on suppliers like Samsung Electronics Co., Japan Display Inc., and LG Display Co. Shares of Universal Display Corp. (Ticker $OLED) fell as much as 16% on Monday.
Wall Streets biggest fear is ‘Trade War’. According to CNBC Fed Survey, worries over trade wars surpassed concerns about terrorism, inflation, and the Federal Reserve.
In World News…
Lawmakers in Brazil are considering lifting a ban on civilian gun ownership. 60,000 people are killed each year making Brazil the murder capital of the world.
WHAT'S UP FRIDAY? is a weekly newsletter that will give you a summary of "What's up?" on Wall Street, in the US and around the World written by The Alchanati Campbell and Associates Team. What makes us unique is we focus on long-term knowledge; knowledge that will still be useful to you 10 years from now.