Tesla showdown

MARKETS

• U.S. markets: Financials took a slight dip, but tech stocks gained momentum for a second straight day. The Nasdaq finished at another record high.
• Trade: The WSJ reported that China offered to purchase $70 billion in U.S. goods in an effort to decrease the trade deficit and escape from U.S. tariffs.

FASHION

Kate Spade: 1962-2018

Tragic news in the fashion industry: Kate Spade, the pathbreaking designer, was found dead of an apparent suicide in her NYC apartment. She was 55.

Her story

Kate was born Katherine Brosnahan in Kansas City, before eventually moving to NYC to work as an accessories editor for Mademoiselle magazine.

And her fashion empire? It all started with fun, colorful handbags for the aspirational woman. Here she is telling NPR about the night she and her husband Andy (the brother of actor David Spade) came up with the idea:

• "So Andy and I were out, honestly, at a Mexican restaurant. And he just said, what about handbags? And I said, honey, you just don't start a handbag company. And he said, why not? How hard can it be?"

They started the company in 1993 and opened their first store in SoHo three years later. And as it grew, the brand expanded into jewelry, clothing, stationery, and more...becoming an absolute powerhouse in the fashion world.

The winning formula: According to Spade, "I wanted a functional bag that was sophisticated and had some style."

Then came a string of deals

• In 1999, Neiman Marcus bought a 56% stake in the company.
• Seven years later: Liz Claiborne bought the label for $124 million, and eventually renamed itself Kate Spade & Co.
• 2017: Coach (now called "Tapestry") bought Kate Spade for $2.4 billion. Not that Kate herself saw any of the proceeds. She and Andy left the company a decade earlier to spend more time with family (she has a 13-year-old daughter) and focus on other projects.

Especially this latest project: Kate teamed up with Andy and other business partners to launch a new accessories label, Frances Valentine, in 2016.

+ Here's last year's "How I Built This" podcast episode featuring Kate and Andy Spade.

AUTO

Musk Survives Meeting Without a Scratch

The Tesla shareholders meeting was yesterday, and let's just say...Elon Musk knows how to give a performance.

After dodging proposals that would dethrone him from his role as chairman (yes, not everyone is a Musk fanatic), he put on a teary-eyed show and expressed just how hard Tesla works to be great:

• Some employees supposedly have worked 60 days straight and had to be forced home.
• And how about that disappointing Model 3 production? Tesla just made 3,500 cars per week and is aiming for 5,000 by month's end.
• Moving forward? Expect Tesla to hit profitability in Q3 and Q4.

Bottom line: Tesla's been under the spotlight this year. But major shareholders are still betting on Musk to turn things around.

TRANSPORTATION

E-scooter Startup Lime Is Hot on Bird's Tail

"Hey, watch me pop this super cool wheelie."—E-scooter startup, Lime...probably.

After all, it's got a lot to celebrate after Axios reported it's raising $250 million. That comes at just the right time for Lime, considering its main San Francisco rival, Bird, is planning to raise $200 million at a $1 billion valuation.

But if you're not a hipster urban commuter, here's your primer on the recent e-scooting craze:

• Lime claims over 4.2 million rides on its scooters to date, with nearly 8-12 rides per scooter per day.
• Is this the future of transportation? Ride-hailers seem to think scooters will play a role, considering Uber and Lyft have both showed interest in the market.

But it's not all smooth sailing

Some careless riders scatter their scooters all over city sidewalks. It's so bad, San Fran's transportation authority proposed a rule that would limit the city to 2,500 e-scooters.

For now though, the company will celebrate with whatever that drink is that goes best with Lime.

STOCK MARKET

Entrances and Indexits: Twitter Edition

With the "Monsanto" name going extinct (as a result of its mega-sale to Bayer), one lucky bird is getting called up to the big leagues: Twitter (+4.96%) is joining the S&P 500 on Thursday, replacing agriculture giant Monsanto.

Why it's important: Now, Twitter's stock will be exposed to all investors who own shares in index funds that track the S&P.

• This is the cherry on top of a nice little run. Shares are up 55% this year and Twitter has been profitable for two straight quarters. It's the small wins...

There's more: With Monsanto out of the picture, Netflix—now firmly ahead of Disney in market cap—also received a promotion...to the even more prestigious S&P 100.

+ Deep dive (and we mean deep dive): The methodology behind selecting companies to join the S&P indices.

+ Tl;dr: A committee makes a decision based on certain criteria like market cap, liquidity, and sector classification.

PERSONAL FINANCE

Student Loans: It’s Time to Empty that Piggy Bank

All of those happy hour Orange Crushes were worth it...right?...Right?

Maybe. But lately, the cost of higher education has sent student loan debt jumping to $1.5 trillion. Here's how it breaks down by the numbers:

$28,400—How much debt the average new grad owes. That number was $22,100 in 2001 (adjusted for inflation).

20%—Borrowers who are late on payments.

66%—Student loan debt held by women. Typically, more women attend some form of higher education than men.

For perspective...

$1.2 trillion—U.S. auto loan debt.

More than $1 trillion—U.S. credit card debt.

WHAT ELSE IS BREWING

• Billionaire political donor David Koch is retiring from Koch Industries and related organizations, citing poor health.
• UK regulators appear ready to allow Fox (+1.09%) to buy a majority of Sky, but only if it divests Sky News. Comcast (-0.67%) also shouldn't have a problem with its bid.
• Social Security is dipping into its reserves for the first time in 36 years.
• Ray Dalio's hedge fund Bridgewater Associates wrote in a note to clients, "We are bearish on almost all financial assets," per BI.

BREAKROOM

PERSONAL FINANCE TERM
Rule of 72—Ditch the TI-89 and use this simple method to calculate how long it'll take your investment to double. How? Just divide 72 by the fixed annual return and you'll get a rough estimate of how many years it'll take to 2x.

Ex: With a 6% return, your money will double in...(72/6)=~12 years. Here's more.

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Breakroom Answers