Robinhood Snacks - 🐻 Bear market is back

Bad news Bear Market... With the Dow down 20% from the record high it notched in February, we've reached the technical definition of a "bear market" after a historic 11-year bull run. Wednesday's 1,465 point drop was the 2nd largest on record (after Monday's) — The stocks of 94% of S&P 500 companies are now 10%+ lower than their recent highs. You may hear the term "bailouts" tossed around, aka tax-payer funds loaned by the gov to key companies/sectors at risk of going broke...

• Pros: Bailouts can save hundreds of thousands of jobs and protect from defaults that might cause industry-wide domino-effect collapses.
• Cons: They cut into tax-payer $$ and might encourage companies to operate more recklessly (aka "moral hazard").
• Recent bailout history: '08 (financial institutions — except Lehman Brothers), '09 (Detroit's General Motors and Chrysler), '19 ($28B for farmers suffering from the US/China trade war).

And the bailout bachelors are... Unlike in 2008, the issue hurting markets now isn't fundamentally related to the health of the economy. It's the effect of people staying home (not spending) that hurts — that's hitting some industries harder than others, earning them (still early) bailout attention:

• Airlines: Cancellations have skyrocketed — but the major carriers have decades-long profits to cushion falls.
• Cruiseliners: Cruise operators including (and especially) Carnival have seen bookings drop — but we don't think they employ enough people or are integral enough to the economy.
• Oil: Energy giants are struggling through a 50% plunge in prices — but these pump icons have plenty of cash and it would be optically hard to bailout fossil fuel companies while climate change happens.

"I might even be a Rockstar"... Hannah Montana said it best, but Pepsi's feeling it — it just bought Rockstar Energy for $3.85B. Russ Weiner founded the canned energy company in '01 (his mom was CFO). Pepsi has distributed Rockstar since '09, but that deal meant it couldn't launch a Mountain Dew-branded energy rival — now that it's acquired Rockstar, its energy ambitions are unlimited. The rest of Big Bev is shifting from sugary sodas too for these reasons...

• Health: Tea, coffee, kombucha, coconut water, and other lower-cal and more natural bevs have skyrocketed in demand.
• Energy: Energy drinks and coffee-flavored anything are increasingly splurgeable commodities (because we're all exhausted).

Or combine the 2 for a winning strategy... For years, Big Bev lagged in the exploding health/energy sector. Lately, it has been upping its "functional drink" game:

• ABInbev's Bud literally launched a hard green tea and hard coconut water brand... this week
• KeurigDrPepper launched "healthy" energy drink Adrenaline Shoc.
• Coke owns a 19% stake in Monster, then eventually launched its own energy drink competitor (Coke Energy) despite Monster's complaints.