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Good morning. Today is the final day in our monthlong Fantasy Investing Competition, and we’ve got a tight one on our hands, folks. Louis Tsui is in first place with a 158% return but Ronald Henderson is close behind, having grown his portfolio 147%.
Whoever wins, we learned a valuable lesson: Picking stocks (and cryptos) is hard. The average player is down 3.6% on their investments, compared to the S&P’s -0.9% return.
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Nasdaq
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13,614.51
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S&P
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4,192.85
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Dow
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34,577.04
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Bitcoin
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$38,822.70
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10-Year
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1.625%
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GM
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$63.46
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*Stock data as of market close, cryptocurrency data as of 6:00pm ET.
Here's what these numbers mean.
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Markets: Investors are putting on their rally caps ahead of the big May jobs report this morning. GM said it had the chip shortage under control, raised its earnings forecast, and watched its stock hit a record high.
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Economy: As he searches for compromise on his infrastructure plan, President Biden offered to replace his proposed corporate tax increase for a 15% minimum tax on corporations as a way to fund the plan. Talks between Biden and GOP lawmakers will pick up today.
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ENVIRONMENT
Kim, There's Reservoirs That Are Drying
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Stephen Lam/The San Francisco Chronicle via Getty Images
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The latest shortage hitting the American West? Water. And while Chick-fil-A sauce and semiconductors are important for a functioning economy, this year's historic drought in the West could affect—and we do mean this—literally everything.
The state of play: California Gov. Gavin Newsom has put 41 counties under a state of emergency in an attempt to drastically limit water use. Some scientists say the region is facing the worst drought in centuries.
Who’s getting hit the hardest?
Anyone who eats food. The water levels of 1,500+ reservoirs in California are 50% lower than normal at this time of year, per Jay Lund, co-director of the Center for Watershed Sciences at UC-Davis. This means huge cuts to the water that farmers in the state use to produce over 25% of the country's food supply.
- Your morning breakfast of Blue Diamond almond milk and habanero BBQ almonds could be impacted. California accounts for 80% of the US' almond supply, but because of shrinking water allocations, some farmers are simply bulldozing those notoriously thirsty almond trees.
Anyone who uses electricity. Officials are predicting the water level of Lake Oroville, the Beyoncé of California lakes, to hit a record low in August. If that happens, they would need to shut down a major hydroelectric power plant, putting extra strain on the electrical grid during the hottest part of the summer.
Anyone who is a fish. In April, California officials announced they'd be driving 146 truckloads of 15+ million young salmon to the Pacific Ocean because the fish wouldn't be able to swim in the dangerously shallow, warm waterways connecting the state’s Central Valley to the ocean.
Anyone who dislikes wildfires. Five of the six largest wildfires in modern California history happened during the 2020 wildfire season, killing 30+ people. Experts say the current conditions are much worse.
Bottom line: This drought could have devastating consequences for the state’s agriculture, wildlife preservation, and tourism industries. #BoatSummer in California is not looking good.
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Boom Supersonic
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Cicadas aren't the only thing that return every ~17 years. The promise of supersonic commercial flight reemerged yesterday when United Airlines announced it's buying 15 jets from Boom Supersonic.
Supersonic = faster than the speed of sound. Boom's planes could cut flight times in half and get you from a bagel breakfast in NYC to teatime in London in 3.5 hours.
Catching a flight that quick hasn't been possible since 2003, when the iconic Concorde jet retired. It was an expensive, gas-guzzling machine, and the loud booms it made while breaking the sound barrier woke up enough babies that Congress banned supersonic flights over US soil in the ’70s.
- Now, Boom and other supersonic startups are working on net-zero emissions and noise-muffling tech.
Looking ahead...supersonic jets are largely in the development phase; Boom's never actually built a full-scale version of its Overture aircraft, and it'll need to clear regulatory checks before passengers hop onboard in 2029. Just last month, one of the leading supersonic jet makers, Aerion, shut down because of financial troubles and concerns about fuel-efficiency and noise regulations.
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At long last, Twitter has released its first subscription product, Twitter Blue. For now, only Australian and Canadian users can pay around $3/month to access Blue features like a 30-second grace period to undo or edit a tweet before it's posted, prioritized customer support, Reader Mode for easier viewing of threads, and color scheme customization for the app.
Not quite the "edit" button users have been begging for and nothing particularly groundbreaking. So...why are we writing about it?
Investor pressure and advertising competition from the likes of Snapchat and Facebook pushed Twitter to look for new revenue streams. A subscription offering has been on the roadmap for years.
Big picture: Twitter's product team must have picked up a copy of Deep Work during the pandemic, because they've been testing and/or launching tons of new features including...
- A virtual tip jar
- "Super Follows" for individual users to charge subscriptions
- Voice-based DMs and tweets
- Features that limit the spread of misinformation and prevent harassment
- Stories (aka "Fleets")
- Spaces, a Clubhouse competitor
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Let's be honest: There are a lot of places where you can buy and sell stocks. But maybe you're looking for more than just a place to park your investments. Maybe you want to connect with other investors and even the executives behind the companies you’re curious about.
What you want is Public.com, the only investing app with a built-in community. On Public, you can have conversations about market news in the same place where you manage your portfolio and even ask questions to CEOs.
Interested in learning more about sports betting or healthcare? DraftKings CEO Jason Robins and Hims & Hers CEO Andrew Dudum are both hosting Town Halls this month.
To top it off, Public also has live audio shows where knowledgeable commentators dish on the latest market news.
Join Public and use code BREW to snag a free $10 slice of stock.
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Stat: Babe Ruth's 1914 "pre-rookie" card was valued at more than $6 million, becoming the most expensive trading card in history. And you can own it: The investing platform Collectable is selling 20,000 shares in the card for $3 a piece.
Quote: "We believe that recent volatility and our current market prices reflect market and trading dynamics unrelated to our underlying business."
In a filing, AMC acknowledged that the 2,900% jump in its share price this year was not (shocker) actually related to a miraculous turnaround for the movie theater industry. This warning, plus its plan to sell more than 11 million shares, resulted in an 18% drop for the day.
Read: America has a drinking problem. (The Atlantic)
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Pixar
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There was a distinct theme to business news headlines yesterday: Prices across sectors are growing at their fastest rates in years.
Housing: Global housing prices increased 7.3% on average in the 12 months to March—the fastest pace since 2006, according to Knight Frank's Global House Price Index. The top five countries for price growth are 1) Turkey 2) New Zealand 3) Luxembourg 4) Slovakia and 5) the US.
Shipping: The cost of moving a container from China to Dubai has ballooned to $5,000 from $1,000 last year, according to SCMP.
Food: A UN food price index soared 40% in May, the largest jump in a decade. Low-income countries will suffer the worst effects of this food inflation.
Consumer goods: Prices across 36 mostly wealthy countries rose at their fastest pace in more than 12 years during April. Economists are chalking up this eye-popping inflation to "base effects"—meaning these numbers only appear huge because they're being compared to last spring, when prices plummeted at the onset of the pandemic.
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Francis Scialabba
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The feeling of getting a 5/5 on the Brew's Weekly News Quiz has been compared to scream-singing in your car.
It's that satisfying. Ace the quiz.
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President Biden issued an executive order that prohibits investments in 59 Chinese firms that facilitate human rights abuses.
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The DOJ is now treating ransomware attacks with the same priority level as terrorism, per Reuters. A Martha's Vineyard ferry was the latest service hit by an attack.
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Facebook plans to end its special treatment of politicians, according to The Verge.
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Jobless claims hit a new pandemic low of 385,000 last week.
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Can you find the mouse among the mushrooms?
Gergely Dudas
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✢ A Note From Public.com
*This is not investment advice. Free stock offer valid for U.S. residents 18+ and subject to account approval. See Public.com/disclosures/,
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Written by
Alex Hickey, Matty Merritt, and Neal Freyman
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