Monday, Oct 30, 2023

a powerful dissent, tech wobblies, pockets of strength

“The person who says it cannot be done should not interrupt the person who is doing it.” – Chinese Proverb  ||

Hello everyone! I hope you all had a good weekend! And may I just say that daylight savings time makes NO sense, and having different places do it at different times is a complete hassle. 😠 Ok, rant over, thank you for listening.

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Programming note: While much of the world celebrates Halloween, here in Spain we celebrate All Saints’ Day on November 1st, when we pay our respects to the dead. It’s a national holiday here, so this email will take a break on Wednesday, but back in your inboxes on Thursday!

IN THIS NEWSLETTER:

• Markets: An oasis of calm in a sea of discontent

• A powerful SEC dissent

• Tech is finally wobbling

• Why we spend on things we don’t like

WHAT I’M WATCHING:

An oasis of calm in a sea of discontent

It feels a bit too obvious to point out that markets are nervous. On Friday, the S&P 500 officially entered correction territory, since it is now down more than 10% from its 2023 high. The Nasdaq is down more than 12%, and the Dow Jones limped in with its worst week since March’s banking crisis.

(chart via TradingView)

Tech stocks are getting especially punished, even though their results have been pretty good. Profit came in above expectations for 79% of the more than 200 companies that have reported so far, above a long-term average, with most of the increases concentrated in the “Magnificent Seven” (Google, Microsoft, Amazon, Tesla et. al.). Yet their share price drops last week dragged the performance of the S&P 500 weighted by market cap below that of the equal-weight index for the first time all year.

(chart via TradingView)

It’s almost as if the market was looking for an excuse to be unhappy.