Alchanati Campbell & Associates
What are common beliefs that we all share? Beliefs that are universal and that apply to all. Beliefs that everybody should live by regardless of religion, origin, ethnicity and personal difference. Today we are celebrating our 1 year Anniversary! We’ve learned a lot and we’ve shared a lot. Here’s a list of some common beliefs we all share and that we all should live by: Social cooperation is our key for survival and reproduction. Always be calm and composed regardless of the situation. Never compare yourself to others, especially if they are above you. If you value who you are, you need no one to confirm your worth. Persistency leads to success. Life is unconquerable. It is not about the end, it is about the process and the adventure to get to the end. When you fail, get a bad grade or mess up, don’t be discouraged and do not give up. Money is only a byproduct, it is not the main pursuit. All of our problems are the same. Actively work on knowing your true self and being comfortable with your inner voice. Don’t fear failure. Listening is a great virtue. Increase your threshold for pain and criticism. No one is perfect and we are all learning and growing. Focus on the now and worry about future tasks later. If you do not love yourself, you will be unable to love anyone else. Stop trying to seek validation. Make people feel like they are valued and important. Most people want two things: pleasure and stability. Don’t give a fuck and never be afraid.
The Market. Modern Monetary Theory proposes that a country with its own currency doesn’t have to worry about accumulating too much debt because it can always print more money to pay interest. While any single household can dig itself out of a hole by cutting spending when its income falls, the economy as a whole cannot. Lyft went public today, surging 23% on its first day. Half of Americans approaching retirement have nothing saved in a 401(k) or other individual accounts.
Purpose unmasked. What is it that you want to achieve? Why are we always trying to create? What is true but not obvious? What if all your close-held beliefs were wrong, would your identity survive? Who are you, where is your place and what were you made for? Everybody in the world is looking for a purpose. 1) The purpose of life is not to be happy. It is to be useful, to be honorable, to be compassionate, to have your life make some difference so that you have lived and lived well. 2) The purpose of this world is choice- to give us the incredible opportunity to be independent things, to live our own lives, to be ourselves. All you hope to get out of life is that you lived for the purpose of what you were created for. 3) The purpose of life is right in front of us: it’s to create a reality we want to inhabit- to reach towards the better end of our conscious experience. Because we live, life matters. What makes a human life have meaning or significance is not the mere living of a life but reflecting on the living of a life. A life, like anything else, may be of much worth even if it is not geared toward and does not serve any ulterior purpose. I do not enjoy myself for a certain end or purpose. I just enjoy; it is worthy in itself. 4) The purpose of life: improve yourself and improve others. No one can lead a happy life if he thinks only for himself and turns everything to his own purposes. You should live for the other person if you wish to live for yourself. It is your ultimate choice to decide whether life is for a purpose, for what purpose, or for no purpose at all.
The current state of the Fed. It seems like the Fed, led by Jerome Powell, is standing by his dovish stance. After seeing the weakening economy in 2019, the Fed has held a decisive stance of not raising rates, for the first half of 2019. Currently sitting at a 2.25-2.50% Fed funds rate window, it seems the Fed has dug themselves into a tight spot, with the economy still weakening, with a heavy balance sheet, and a relatively low interest rate. In the past, it has taken over an 800 basis point move to pull us out of a recession, with 2009 taking us from a 5.25 Fed funds rate to 0. What most people don’t realize was from 2009-2010, we also employed over $1.3 trillion worth of quantitative easing (debt), bringing our Fed balance sheet to a local all-time high of $2.054T. We continued to use QE to keep our economy booming, with our balance sheet hitting $4.5t in 2014. In the last year, the Fed has been unwinding this balance sheet to around $4T. Personally, with the already low interest rate, and the massive balance sheet they weren’t unable to unwind at a fast enough velocity, they will not have any financial instruments left to stop any impending recession.
Inverted Yield Curve. An inverted yield curve is when the short term rates have a higher return than long term rates. The reason this occurs is due to capital leaving other financial markets and going into long term treasury bonds. This causes prices to increase and yield to decrease. People usually also leave short term treasuries and flock to long term, which in return decreases prices and raises rates. This has happened in the last year to the 3month - 3 year- and 5 year, but recently we saw the 3month and 10 year invert, which most people view as a sign of an impending recession. Personally, I like to look at the fed funds rate vs. 10 year, which has had a decently high rate of predicting an upcoming recession, most notably in 1981, 2000, and 2006. As of March 25th, this has inverted and has continued to stay inverted.
Productivity and Motivation. Productivity is the name we give our attempts to figure out the best uses of our energy, intellect and time as we try to seize the most meaningful rewards with the least wasted effort. It isn’t about working more or sweating harder, it is about making certain choices in certain ways. Productivity rises when people do the same kind of tasks over and over. Repetition makes us faster and more efficient because we don’t have to learn fresh skills with each new assignment. To motivate ourselves, we must feel like we are in control. When people believe they are in control, they tend to work harder and push themselves more. When we start a new task or confront an unpleasant chore, we should take a moment to ask ourselves “why”. If you can link something hard to a choice you care about, it makes the task easier. The best productivity strategies: assign a fixed period of time to a task, schedule it and stick to it. Prioritize. Politely decline (say no!) so that you can focus on the most important work. Moving around does a lot for you. Clear your desk of distracting devices and see how much more you get done with fewer distractions. Take short breaks. Eat well. Choose when to check your email. Organize your workspace. Wake up early.
The fall of the iPhone has begun. As sales peaked, Apple needed to allocate their insane amount of cash into new products and services so they could grow. The answer? Apple decided to enter not one, not two, but three overcrowded and highly competitive industries. First on the list is Apple’s new subscription service. Apple TV has been around for a while but this summer the app is getting an upgrade and will soon include providers like Hulu and HBO as well as Apple’s very own streaming service similar to Netflix. The video streaming industry is roughly valued at $30 billion annually and is expected to double by 2021. With that much potential growth at stake, it's no wonder that the industry is filled with major players like Disney, Amazon, Hulu (Disney, Comcast, AT&T), and Netflix. Together these companies represent trillions of dollars meaning that Apple may have a tough time differentiating their product and carving out a market segment. Apple then decided to give the gaming industry a shot. Since its release, the “App Store” has dominated the mobile phone gaming industry beating every other major company to the table and holding their ground for years. Apple may be poised to do it again as Apple Arcade is set to release this summer and offer a subscription-based gaming service that is similar to ones in the works by Google, Microsoft, Sony, and Amazon. Again you can see Apple is taking on a major and highly competitive market, but Apple had a definite advantage here. The gaming industry was estimated at nearly $140 billion dollars in 2018 but over half of revenues came from mobile gaming. At launch, Apple’s gaming service will be able to reach half of a market segment valued at $70 billion dollars. To top things off, Apple partnered with Goldman Sachs to offer a brand new type of credit card. This is Goldman Sachs’ very first consumer credit card and together the companies plan to enter an industry that saw $1 trillion of volume in Q4 2018 alone! There's no way to tell what the future holds, or apparently what market Apple will enter next, but one thing is for certain: Apple will face competition it hasn’t seen since taking on tech giant IBM in the early ’80s.
The Alchanati Campbell and Associates Team
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.