- U.S. markets: It was a record-setting day. The Russell 2000 (an index of small-cap stocks) hit a record intraday high, and Nike--public since 1980--also hit an all-time record.
- Trade: Chinese Vice Premier Liu He is in D.C. for four long days of trade talks. He met with GOP lawmakers yesterday.
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Battle Royale: CBS vs. National Amusements vs. Shari vs. Sumner
CBS has a new hit drama series...starring itself. Yesterday, CBS took the stand after filing a lawsuit against its media overlord, National Amusements, which has 79% of CBS' voting rights and is vying for a CBS-Viacom merger.
And to paraphrase the debacle, CBS basically said: "Hey National Amusements, we don't want to merge with Viacom. We're moving towards new media like streaming and Viacom's old news."
Need more evidence CBS means business? It's proposing a special shareholder dividend that could lower National Amusements's voting power from 79% to 17%.
Nearly everyone at CBS and their second cousins are against this merger
So why is National Amusements so set on pushing it through?
Meet Shari Redstone, the businesswoman with control over National Amusements, Viacom, and CBS. And ever since her father, Sumner Redstone, separated CBS and Viacom in 2006, she's been hustling to get them back together. To consolidate operations? Power? Who knows.
But here's one compelling angle to consider
To put it lightly, Sumner and Shari don't exactly see eye-to-eye. We could share years of verbal assaults between the two, but we'll boil it down to these soundbites.
- Sumner: "Shari does not have the requisite business judgment and abilities to serve as chairman of the three companies."
- Shari: "If my father wants me to drop dead he doesn't need to do anything else...He has made how he feels about me perfectly clear."
Now, Sumner (age 94) partially communicates through an iPad with allegedly three core responses: "Yes, no, and f*** you." And Shari might think this is her best shot at the empire she's always dreamed of controlling.
SEC Creates a Fake ICO Site to Show You How Easy It Is
We've all been Rickrolled, but has anyone ever been SEC-rolled? It's less funny and hardly rolls off the tongue.
But in its ongoing purge of bad crypto actors, the SEC released its own fake ICO website, showing consumers first-hand how to avoid crypto scams. It's called HoweyCoins.com.
Okay, we got you there. Here it really is.
With everything from a white paper to a team of experts, it feels like HoweyCoin could be legit...and that's exactly the SEC's point. But enough from us, we spoke to Lori Schock--a Director at the SEC and one of the brains behind HoweyCoins:
MB: How common is ICO fraud?
Lori: It's well over $600 million, and that's just the universe where we've brought action. There's a whole lot of fraud that's either underreported or unreported.
MB: Why release the site now? Did it have anything to do with Blockchain Week in NYC?
Lori: That was a pure coincidence, but ICOs are a hot topic. When it makes programs like John Oliver, we knew it was in the mainstream.
MB: What advice would you give aspiring crypto investors?
Lori: Don't invest more than you can afford to lose. And beware of any claim about guaranteed returns. We've seen extraordinary promises, you know, 1,400% returns. If anyone could guarantee that and make that, they wouldn't share it with other people.
MB: Can we get an official SEC statement on BananaCoin?
Lori: No comment.
Who Ran From Iran?
Here's a little Econ 101 for you: Sanctions really work--just ask Iran. Only a week after the U.S. withdrew from the nuclear deal and reimposed heavy sanctions on the country, we're already seeing some fallout.
- Meet Total, a French oil and gas giant: It's pulling the plug on its $2 billion investment in Iran's South Pars gas project.
- Why? "Total has always been clear that it cannot afford to be exposed to any secondary sanction."
That means it won't risk bumping heads with the U.S.
U.S. banks provide 90% of Total's financing, 30% of Total's shareholders are U.S.-based, and the U.S. is home to $10 billion worth of Total's assets.
Bottom line: If you do business with Iran, you're effectively cut off from the American financial system. So expect more European companies to rethink their engagements with Iran.
Rate These Apology Ads
Just ask Wells Fargo. Along with other scandal-plagued companies like Uber and Facebook, it's launched a major ad campaign asking for your forgiveness. And in case you haven't seen the commercials...
- Wells Fargo takes us back to U.S. History class, describing the bank's pivotal role in the nation's westward expansion. "Wells Fargo, established 1852. Re-established 2018." Classy stuff. Crew's rating: 8/10.
- Uber shows off CEO Dara Khosrowshahi's pearly whites, claiming: "Moving forward, it's time to move in a new direction." Dara is charismatic, but not much substance here. Crew's rating: 6/10.
- Facebook wants you to know it's taking steps to protect your privacy, "so we can all get back to what made Facebook good in the first place: friends." A self-serving, non-apology. Crew's rating: 3.5/10.
So You Want to Own a Sports Team?
With a little disposable income, you can grab a piece.
In fact, legendary British soccer club Manchester United (ticker: MANU) is reporting earnings today. Investors will keep an eye out for ticket sales, sponsorships, and adjusted red cards per share.
And interestingly enough, Man U isn't the only sports team that's publicly traded. Here are a few more:
- Other European soccer teams like FC Porto (Portugal), A.S. Roma (Italy), and Borussia Dortmund (Germany).
- The New York Knicks and the New York Rangers are owned by Madison Square Garden, a public company. And Liberty Media controls the Atlanta Braves.
Finally, let's dispel a common myth: Yes, you can own shares of the NFL's Green Bay Packers (although the team has sold stock only five times in its nearly 100-year history). But keep in mind, owning a share gets you a paper certificate and not much else.
WHAT ELSE IS BREWING
- Amazon (+0.71%) rolled out new discounts for Prime members who shop at Whole Foods.
- Macy's (+10.83%) had a blowout Q1, with comparable sales up 4.2%. It also raised its full-year profit forecast. How about a parade to celebrate?
- Tencent, the Chinese tech gigantor, beat earnings thanks to its gaming business.
- Lachlan Murdoch will become the CEO of the remaining parts of Fox that Disney isn't acquiring (sports and news).
- Mark Zuckerberg will appear before the European Parliament to discuss Facebook's privacy policies. And just in time...our meme well has dried up.
- Novartis's top lawyer is stepping down after the pharma company revealed it signed a $1.2 million contract with Michael Cohen.
TALK LIKE THE CREW
13F--If you're an investor managing over $100 million in assets (we know a therapist if you need one), you're going to have to file this form every quarter to disclose some of your holdings. The deadline to file is 45 days after the quarter ends, so we just learned a lot about hedge funds' Q1 positions. Spoiler: they liked Facebook and dumped Apple.
WHAT THE CREW IS WATCHING
HBO's Wizard of Lies--Bernie Madoff's Ponzi scheme was the largest fraud in U.S. history. Whatever you planned on doing tonight, watch HBO tell Madoff's story instead (starring Robert De Niro).
What do these numbers have in common, other than all being palindromes? 484, 676, 10201, 12321
(Answer located at bottom of newsletter)
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They are all perfect squares