Welcome back, {{first_name}}. Not infected yet? Still got a job? Lucky you. Markets have had a mixed week so far but we’re not impressed. We saw the end of arguably the most extraordinary quarter in financial history, 1 million global cases of Covid-19, another 6.6 million unemployed, and what we believe is reality seeping back into markets ending last week’s bear market bounce. Today we’re going demystify the Fed’s $4 trillion lending scheme authorized by congress, make our case for why the quarantine life is here to stay, and why the market is gearing up for another leg down. …
{{first_name}}, stop. Before you continue reading we need to screen you for Covid-19 and ensure you weren’t exposed in the past 14 days by analyzing your location data. Just kidding, this isn’t Israel. We’re frankly speechless in the face of this week’s events which include but are not limited to the Fed committing to infinite QE, the U.S becoming #1 in terms of Covid-19 cases, and a vicious rally that appears to have pulled us out of a bear market…for now at least. In this issue we’ll be covering the Fed’s recent (desperate) moves, how the science behind Covid-19 can…
Warren Buffet famously said that “Only when the tide goes out do you discover who’s been swimming naked.” Buffet humorously describes how any investor is successful in a bull market, but when the market drops few remain standing, that is, not swimming naked. The recent global outbreak of COVID-19 has led to unexpected market turmoil, leaving many funds and speculators scrambling for liquidity to cover losses or meet margin calls. The United States and other global economies have suffered greatly following the spread of the virus, leaving them to face its long-lasting effects. However, this only comprises a small part…
Hello {{first_name}} lovely weather we’ve been having. Too bad we can’t go outside. As the world collapses around us we’ll be covering global economic policy in response to the Covid-19 fallout, making our case for why we’re already in a recession, and of course our market outlook for the week ahead. So let’s dive into what you need to know going into the weekend on Issue #4 of Plato’s Cave: Everything and the Kitchen Sink.
We’re Out of Ammo
If you’re starting to see a pattern in how we start these newsletters b******* about the Federal Reserve, you’re right. As you may already know…
It is the wet dream of traders ranging from Robinhood amateurs to veteran hudge fund directors to score the next juicy “Big Short”. The idea was popularized by a film released in 2015 called…well The Big Short. To bet against the most inflated asset bubble that the current expansion can offer. To defy the naysayers and “smartest” minds of the financial industry. To earn legacy wealth while the economy collapses around you. That is what every trader (and would-be traders) drool over. Well, we at Plato’s Cave have one idea for what this trade could be. If we’re right then…
What’s up {{first_name}} welcome back to the cave. It seems as though these days the news gets crazier every week and its becoming increasingly more difficult to build out any sort of cohesive narrative regarding current events. Lucky for you, we’re here. We’ll do our best to connect the dots on what went down this week. So strap in for the third issue of Plato’s Cave: Slammed from All Sides
Mo’ Money, Mo’ Problems
The S&P 500 has already fallen nearly 15% since last Friday’s close and Futures are set to open lower at the start of trading on March 13th. Equities markets have…
Few like to hear these words: “I told you so!” However, that will be the theme of this article. Not because we warned you of an imminent recession and credit crisis but because a man named Hyman Minsky did. If you have ever been in an introductory economics course or feel like you have a basic understanding of the concept of supply and demand then you are somewhat familiar with the notion of an equilibriating economy. That is, an economy that is constantly at or reverting to a state of equilibrium. Indeed our modern economic models employed by central banks…
Welcome back {{first_name}} we’ve been waiting for you. All sorts of crazy s*** has been going on in markets this week and we’re here to help you make sense of it. So strap in for the second issue of Plato’s Cave: Money Can’t Buy Me Love…
Powell’s Impotence
This week Jerome Powell surprised markets by announcing that the Fed was going ahead with an emergency cut to its key interest rate by 50bps. A resounding WTF was in order when the news broke on Tuesday. …
Do you like Netflix? Of course you do. Do you like Netflix as a company? Probably. Do you like Netflix as a long-term (or even short-term) investment? You shouldn’t. While you binge their shows, they are bingeing on junk debt. Netflix has adeptly kept its absurdly high content spending under the radar. As of the time of this article’ publishing, if you google “Netflix debt” and click on news, you’d have to go to the second page of results and only then you’ll find an article from Variety (yes, VARIETY) discussing the issue. All credit to Variety, they do an…
If you are one of my family members, close friends, or coworkers, you would know that I am a finance fanatic and that once I start, I won’t shut up talking about the economy. Additionally, you would know that for about the last ~3 months, I’ve been incredibly concerned with the frothy corporate debt market as well as equities. You would have had to endure me blabbing about the fact that we are on the brink of crisis, because we are. I’ve promised to put my thoughts down into writing so that those I hold dear don’t have to endure…
Aristocles
Plato’s Cave seeks to enlighten its readers with financial analysis that will lead them out of the cave of deception and out into the world of financial truth
