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Good Morning Everyone!
Remember, the stock market has doubled your money every ten years for the last 100 years (on average). It has done this with:
It’s a long-term game. Stay the course.
QQQ trading in a narrow range as investors debate near-term trajectory for estimates for Q2 and 2nd half 2022
7 a.m. U.S. MBA Mortgage purchase application index down 7.1% in week ended June 3
Now down 21% y/y
Good data for a soft landing scenario
Opposite for used car prices which had been falling but were up 0.7% in May 2022 (reported yesterday).
That broke a 3-month streak of consecutive month over month declines
Manheim May’s index is just 5.7% below the all-time peak and 60% higher than May 2019
Crude 121 +1%
Gas Buddy had national demand down 2.3% sequentially
last week included the holiday weekend but not the fill ups beforehand
2% is not demand destruction
10:30 a.m. Department of Energy oil inventory numbers
Exxon hitting 2014 highs
Multiples have certainly come down (see Public Cloud valuations below).
As an example: Shopify traded north of 30 times revenue. SHOP currently trades at 10 times revenue.
What that means in stock price is staggering. High of $2139 to todays $476.
Is the multiple compression enough or are earnings estimates coming down as we wrap up Q2?
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US Senators Gillibrand and Lummis introduced a long-awaited bipartisan bill that seeks to provide a comprehensive regulatory framework for digital assets — key takeaways:
Define the terrain between crypto securities and commodities
Would give Commodity Futures Trading Commission (CFTC) authority over spot markets in crypto commodities
Seeks to clarify the meaning of a crypto broker
Crypto operations would have to start paying fees to CTFC
Suggest an industry “sandbox” to let firms test new products on a limited scale and duration
New framework for banks and credit unions to issue stablecoins
Good starting point, but this is going to take time
Citibank released a report yesterday offering a blueprint for organizations considering crypto adoption —key takeaways:
Active Bitcoin addresses have declined
Futures open interest has declined but is recovering
ETF inflows in recent days
Reduction in trading volumes and futures positions, but no wholesale declines in investor interest
“Whether or not cryptocurrency disrupts the payment system as we know it, it has sparked new thinking in payment infrastructure, processing, and accounting, in addition to its increasing adoption as a store of value”
Related: Citigroup is awaiting regulatory approval to trade BTC futures
Also: trading firms Citadel Securities and Virtu Financial are working together on a crypto “ecosystem” that would allow retail brokerages to offer crypto-execution
FTX surpassed Coinbase in total Bitcoin spot trading volume:
But Binance still dominates the space:
Bitcoin is still trading in the same range established in mid-May:
A realized price of $23,600 (average cost basis of all Bitcoin in supply) should act as key support:
MEME OF THE DAY
How is WallStreetBets feeling this morning?
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