#Toshiba misses deadline, #Uber teases IPO, copycat otters

Good morning, Quartz readers!


A chemical plant near Houston is poised to explode. Arkema Group reports the plant was flooded due to tropical storm Harvey. Since Sunday the facility has been without the electricity and cooling needed to prevent chemical reactions leading to a blast. The surrounding area has been evacuated. In 2013 an explosion at a Texas fertilizer plant killed 15 people and destroyed 500 homes.

A German court will rule in an emissions suit against Volkswagen. A consumer advocacy group hopes to force the carmaker (paywall) to buy back all affected vehicles at the original price, saying the carmaker broke EU law by selling software that cheated emissions tests. Defeat is expected, but the group will appeal and wants the case to reach the European Court of Justice.

Vivendi releases first-half earnings. The French media conglomerate will win big as music streaming continues to grow, says a new Goldman Sachs report. Vivendi owns Universal Music Group, one of the world’s largest labels. Universal rakes in royalty payments whenever listeners access its songs through streaming services like Spotify.


Harvey flooded Port Arthur and crossed into Louisiana. The tropical storm churned through the Beaumont-Port Arthur area of Texas, causing devastating floods that shut down the largest oil refinery in the US, before weakening as it hit Louisiana. Authorities in Louisiana issued warnings for flash floods and storm surges.

Toshiba missed its self-imposed chip sale deadline. It’s beentrying for months to offload its flash memory unit to pay down debt stemming from a disastrous move into the US nuclear business. One bid was bolstered at the last minute by Apple, which depends on flash memory from Toshiba for its iPhones—and doesn’t want to depend on Samsung.

Donald Trump pitched tax reform. Speaking in Springfield, Missouri, the US president said that lower- and middle-class Americans would benefit from a Republican tax code overhaul. An earlier report from a non-partisan research group concluded that 60% of Trump’s tax cuts would go to those making more than $599,300 a year.

A US federal judge blocked key parts of Texas’s ban on sanctuary cities. Two days before the law was slated to go into effect, judge Orlando Garcia issued a preliminary injunction blocking the main parts of it, in a victory for immigration rights advocates. Garcia suggested the law, authorizing local police to ask about immigration status during routine stops, would “erode public trust.”

Uber’s new CEO said it could go public in 18 to 36 months.During an all-hands meeting at the embattled ride-sharing giant’s San Francisco headquarters, Dara Khosrowshahi vowed to rebuild company culture and set a timeline for an initial public offering. An Uber IPO would be among the most highly anticipated market debuts in memory (paywall).


Marc Bain on why H&M should do more than identify where its clothes are made. “Shoppers, especially millennials, are increasingly eager to make sustainable and ethical choices, and the rise of ‘transparency’ is a step toward helping them do so. But it’s not an end unto itself: Transparency can only ensure fair and safe practices when coupled with rigorous third-party monitoring, and when it’s clear enough for shoppers to understand.” Read more here.


The Rock should run for president. The world’s highest-paid actor could lay the smackdown on petty partisan politics.

A “fake” Instagram isn’t the ticket to social media freedom. The trend exposes the troubling way that work is taking over our livesonline and offline.

Tech firms are the biggest competitive threat to the banking industry. Google, Amazon, and Facebook have the market corneredwhen it comes to the cloud, AI, and big data.


Entire colonies of fire ants are floating in Texas floodwaters.The stinging pests are set adrift when their nests are inundated.

A first-time author unwittingly exposed the house of cards beneath “bestseller” books. A social media skirmish ultimately revealed how authors can buy their way to the top.

Nearly half a million people need to update their pacemakers’ software. The FDA is recalling several models that are vulnerable to hacker attacks.

Otters learn by copying each other. They complete puzzles more efficiently by watching other otters’ problem-solving techniques.

Traces of wine dating back 6,000 years were found in a Sicilian cave. The discovery revises the history of Italian winemaking back three millennia.

Our best wishes for a productive day. Please send any news, comments, ancient wine, and book-marketing strategies tohi@qz.com. You can follow us on Twitter for updates throughout the day or download our apps for iPhone and Android.


Hurricane #Harvey havoc, #Uber’s new CEO, Babylonian trigonometry

Good morning, Quartz readers!


Brexit talks resume. Britain and the EU return to the negotiating table in Brussels for a third round of talks on the UK’s withdrawal from the bloc. The two sides are expected to spar over the details of Britain’s “divorce bill.”

Hurricane Harvey continues wreaking havoc in Houston, Texas. Torrential rainfall is expected to continue through Friday, with Harvey already having dumped 9 trillion gallons (paywall) of water on the state. At least five deaths have been reported, and some 2,000 people rescued, as well as herds of cows.

India is on alert for more violence ahead of a guru’s sentencing. A judge will be flown by helicopter to the city of Rohtak and the internet will be temporarily shut down in Haryana state, where a court will sentence Gurmeet Ram Rahim Singh after he was convicted of rape last week. More than 200 people were injured and at least 38 were killed in Punjab and Haryana states in riots following his conviction.


Uber chose a new CEO. Expedia CEO Dara Khosrowshahi—whose family fled the Iranian Revolution to settle in the US—was selected to be the new head of the company, following the resignation of Travis Kalanick from the role in June. Former General Electric CEO Jeff Immelt and Hewlett Packard Enterprise CEO Meg Whitman were also in the running.

Wang Jianlin dismissed rumors that he was detained in China.The chairman of Dalian Wanda Group and one of China’s richest men said reports over the weekend that he had been released from detention but barred from leaving China were rumors “concocted with ulterior motives.” Shares in Wanda’s Hong Kong-listed unit plunged by as much as 11% (paywall) Monday morning local time.

The FARC began its transformation into a political party in Colombia. Members of the leftist rebel group, which disarmed under a 2016 peace deal, kicked off a meeting on Sunday in the capital Bogotá. The group will present its political platform ahead of elections next year when the conference ends on Friday.

Former Thai prime minister Yingluck Shinawatra fled to Dubai.After Yingluck failed to show up to stand trial for her role in a failed rice-subsidy program last week, members of her party said that she is now in Dubai, where her brother, former PM Thaksin Shinawatra, lives in exile. Her escape removes a potential problem (paywall) for the ruling junta, as a guilty conviction would likely spark large-scale protests and riots by her supporters.


Aamna Mohdin on the rise of the awkward black girl in TV.Insecure and Chewing Gum are powerful reminders that the narratives of black women don’t have to be extraordinary to be worthwhile. In both shows, the protagonists are awkward, dazed, and hapless figures trying to find solutions to mundane problems—and that’s what makes them brilliant and relatable.” Read more here.


Even creative people don’t have to be creative all the time.Acknowledging when the process is not going well can be the difference between a forced (and failed) creative endeavor, and an opportunity for learning and resetting.

China bullies universities in the West because they allow it to.In the rush to serve Chinese students, Western universities have ended up importing Chinese academic censorship (paywall) into their own institutions.

Price-gouging makes economic sense. Without the incentive of a profit, suppliers of goods will be less motivated to bring products into disaster zones.


Netflix co-created marijuana strains based on popular shows.They were sold at a pop-up event in West Hollywood, giving new meaning to “Netflix and chill.”

Ugly female moths hang out with sexy ones to snag a mate.The behaviors “provide an answer of how unattractiveness can evolve.”

The Greeks definitely did not invent trigonometry. A 3,700-year-old Babylonian tablet is the world’s oldest and most accurate trigonometric table.

The bomb-shelter business is booming in the US and Japan.That’s thanks in no small part to Donald Trump and Kim Jong-un.

Germans prefer harder mattresses. The discovery forced fast-growing mattress startup Casper to rethink its script for international expansion.

Our best wishes for a productive day. Please send any news, comments, sexy moths, and bomb shelters to hi@qz.com. You can follow us on Twitter for updates throughout the day or download our apps for iPhone and Android.

Bespoke Brunch Reads: 8/27/17

Below is our “Bespoke Brunch Reads” linkfest featuring some of our favorite articles over the past week.


Globalization in retreat: capital flows decline since crisis by Shawn Donnan (FT)

While economic growth has recovered following the global financial crisis, there’s been a stark reversal in the previously inexorable growth of global cross-border capital flows. [Link; paywall]

Inequality and macroeconomic policies by Vitor Constancio (ECB)

While ECB President Draghi’s speech on Friday got most of the attention this week, we would argue that Constancio’s mid-week missive on the distributional effects of QE to the European Economic Association in Lisbon was more interesting and more innovative. [Link]


Millennial Americans Are Moving to the ‘Burbs, Buying Big SUVs by Kieth Naughton (Bloomberg)

A friend of ours once quipped “the most interesting thing about young people is that they get older”. While that can probably be taken too far, in the case of big ticket spending and lifestyle Millennials are behaving an awful lot like their parents: leaving cities and buying houses. [Link; auto-playing video]

Facebook may have a grown-up problem: Young people leaving for Instagram and Snapchat by Jessica Guynn (CNBC/USA Today)

Speaking of young people, new eMarketer forecasts predict a 3.4% decline in teenagers’ use of Facebook this year, driven by migration to other apps (one of which is Instagram, which Facebook of course owns). [Link; auto-playing video]


Maersk’s tanker unit invests in quant hedge fund by Robin Wigglesworth (FT)

In order to get access to a high value shipping database and better deploy its ships, one of the world’s largest shipping lines has invested in a quantitative hedge fund. [Link; paywall]

Quant Firm AQR Capital Management Seeks SEC Approval to Sell ETFs by Dani Burger (Bloomberg)

If AQR follows through on new filings, getting acesss to the investment acumen of Cliff Asness and the rest of AQR might become even easier. We should note, no specific ETFs are planned for launch at this time, and the firm basically appears to be keeping its options open for the future. [Link; auto-playing video]


Turnaround University: Quant School On The Hudson by Matt Schifrin (Forbes)

A look at a rapidly growing STEM college with majors including quantitative finance and cybersecurity; the school leaped 68 spots in a single year on the America’s Top Colleges list. [Link]

University of Iowa’s Tippie College to End Full-Time M.B.A. Program by Kelsey Gee (WSJ)

Iowa’s business school is closing amidst declining demand for two-year business degrees. Instead, the school will offer part-time and specialized master’s programs. The school describes the market for two year MBA degrees as “shrinking”, a remarkable turn-around from a few years ago when students flocked to programs thanks to the brutal labor market. [Link; paywall]


3,700-year-old Babylonian tablet rewrites the history of maths – and shows the Greeks did not develop trigonometry by Sarah Knapton (The Telegraph)

Improbably, a clay tablet that dates back almost 4,000 years is teaching modern mathematicians a thing or two. The Babylonian numerical system was base 60 instead of base 10, making trigonometry calculations look much different – and more precise – than our current approach. [Link]

Silicon Valley

Wal-Mart and Google Team Up to Challenge Amazon by Jack Nicas and Laura Stevens (WSJ)

The nation’s largest retailer has signed up with Google Express, the online shopping marketplace run by Alphabet. Wal-Mart will still be responsible for fulfillment as it is with its existing online ordering options. [Link; paywall]

What’s New in the iPhone 8 by Mark Gurman (Bloomberg)

A rundown of the new features and design of the iPhone due out this fall, which looks somewhat similar to the 4 and 4S, along with much higher screen share of surface area, an OLED screen, inductive charging, and a virtual home button. [Link]

Have a great Sunday!

Bespoke Investment Group, LLC

105 Calvert Street, Suite 100

Harrison, NY 10528



Twitter: @bespokeinvest

Samsung corruption verdict, Havana embassy attack, rent-a-parent service

Good morning, Quartz readers!


The annual Fed conference begins in Jackson Hole, Wyoming.Federal Reserve chair Janet Yellen and European Central Bank president Mario Draghi will both be delivering speeches, but the elephant in the room will be whether Yellen will continue for a second term (paywall). Donald Trump has said he is considering nominating her for another term, but his economic policy director Gary Cohn is also a contender.

Samsung’s heir apparent receives a verdict on corruption charges. A Seoul court will decide the fate of Lee Jae-yong, charged with embezzlement and perjury for allegedly funneling $38 million to bribe a close friend of then-president Park Geun-hye. Lee could face up to 12 years in prison—the longest term ever given to a South Korean business leader.

Hurricane Harvey hits Texas. The intensifying cyclone is expected to make landfall late Friday or early Saturday as a Category 3 storm in the heart of the US oil refinery sector. Catastrophic flooding is feared from Corpus Christi to the Louisiana coast, and up to 100 miles (160 km) inland.


A Thai court issued an arrest warrant for former prime minister Yingluck Shinawatra. Yingluck, who was deposed in a 2014 military coup, failed to appear in court over charges of her mishandling of a rice subsidy scheme that resulted in huge amounts of unsold rice and monetary losses. The judge ruled the court would issue an arrest warrant and seize her bail bond.

At least 16 people at the American embassy in Havana fell mysteriously ill last year. In what has been described as a possible sonic attack in media reports, the State Departmentdisclosed the number of affected embassy employees, but stopped short of assigning responsibility to the Cuban government. CBS earlier reported that one of the American embassy staff suffered mild traumatic brain injury with likely damage to the central nervous system.

Qantas announced plans to make the world’s longest flight a reality. Australia’s national carrier said it hopes to offer the 20-hour, 17,000 km trip between Sydney and London by 2022, if aircraft makers can deliver planes that can fly that distance.

Amazon unveiled its preliminary plan for Whole Foods. The retailer’s $13.7 billion acquisition, expected to close on Monday, will result in price cuts at the infamously expensive grocery store, give special discounts to Amazon Prime subscribers, and make Whole Foods’ house brand available on Amazon’s e-commerce platforms.


Max de Haldevang on the mysterious circumstances surrounding nine dead Russian diplomats. “Being a Russian diplomat seems to be bad for your health. When Migayas Shirinsky, ambassador to Sudan, was found dead in his residency’s swimming pool in Khartoum on Aug. 23, he became the ninth Russian foreign official to surprisingly pass away since January 2016.” Read more here.


“Whole paycheck” no more / Amazon’s cutting prices / Grocers catch a chill


Companies should prioritize investor welfare, not value. It would enable them to consider critical social and ethical issues.

All lives should matter to self-driving cars. Germany wants to ban autonomous vehicles from prioritizing age, race, or gender in a collision.

Eavesdropping actually makes us better people. A large part of our development and early education is made possible by our ability to listen in on other people’s conversations.


Google made a cuddly knitwear robot that watches YouTube videos. Researchers eventually want “Blossom” to help kids with autism.

Japan has a rent-a-dad service… Tokyo’s Heart Project offers everything from “parent” to “bridesmaid” surrogates.

… And a ninja-studies major. Sadly, the focus is on historical research, not practical training.

Americans stopped watching TV and porn for the solar eclipse. Netflix and Pornhub traffic showed a noticeable drop.

The driest place on Earth is currently covered in flowers. It only rains every five to seven years in Chile’s Atacama desert.

Our best wishes for a productive day. Please send any news, comments, Atacama flowers, and ninja-studies dissertations tohi@qz.com. You can follow us on Twitter for updates throughout the day or download our apps for iPhone and Android.

CWS Market Review – August 25, 2017

CWS Market Review

August 25, 2017

“The main purpose of the stock market is to make fools of as many men as possible.”
– Bernard Baruch

Mad truth, Bernie. The market does fool-making exceedingly well. Consider the last few months as Wall Street has easily brushed aside concerns about North Korea, President Trump, a weak dollar, the Fed, Tax Reform, you name it, Wall Street’s been as calm as a clam.

Let’s look at some facts. The Dow Jones Industrial Average has now gone 85 days in a row without a 1% daily gain. That’s the longest such streak in over a decade. Bear in mind that historically, a 1% up day is about as common as you can get. The S&P 500 still hasn’t had a 3% drawdown since the election. That means, going by each day’s close, the index hasn’t registered a 3% total decline in more than nine months.

Despite the market’s tranquility, there’s still a lot of news. This week, we had three Buy List earnings report. HEICO raised its full-year guidance, while Hormel and Smucker cut theirs. I’ll have all the details. I’ll also bring up to speed on some recent Buy List news. But first, let’s review this past earnings season.

The Weak Dollar Is Boosting Profits

We don’t have every last number in yet, but we’re very close, and it appears that the S&P 500 had operating earnings of $30.73 for Q2 (that’s the index-adjusted figure). That’s an all-time record. It also represents an increase of 19.6% over last year’s Q2.

This is very good news because there had been growing concerns that the corporate sector was in danger of a slowdown. Instead, this was the fourth quarter in a row of growing earnings. Before that, the S&P 500 went through a nasty earnings recession that lasted seven quarters. What’s important to understand is that earnings are being helped by expanding profit margins. That’s a good sign. For Q2, operating margins topped 10% for the first time since 2014.

The second quarter was also notable because earnings estimates weren’t severely slashed before earnings season. You’ll see that a lot. Estimates will plunge low enough for the results to barely claim an “earnings beat.” Lower the bar far enough so you can step over it. It’s true that earnings estimates almost always start out too high, but the results for Q2 were only 4.7% below the estimate from the beginning of the year. That’s pretty good. Right now, the estimates for Q3 are only 2.7% below where they were at the start of the year. The slashing-estimates game seems to have passed.

So far, 71% of S&P 500 companies have beaten expectations for Q2. Less than 7% of tech stocks missed on earnings. That’s impressive, but the biggest reason for the earnings resurgence is the energy sector. The energy sector went from earning $42.94 per share in 2014 to losing $13.71 in 2015. (Again, these are index-adjusted figures, but in this case, it’s to the S&P 500 Energy Index.) That threw the entire earnings picture for the S&P 500 out of whack. Now energy profits are back, and the overall picture looks much better.

We’re still not quite two-thirds of the way through 2017, but it looks like the S&P 500 is on pace to make about $125 to $130 per share this year. The S&P 500 is going for about 19 times this year’s earnings, and probably about 17 times 2018’s earnings. That’s elevated, but nothing crazy.

What’s happening is that we’ve gone from a period where the strong dollar was distorting corporate earnings. Now the weak dollar is helping the bottom line. It comes down to this: Europe’s economy is trailing by about three years. All of what Mr. Draghi is doing, and has been doing, comes largely from Mr. Bernanke’s playbook.

A few years ago, we were growing, and the Europeans were stuck in a rut. As a result, the dollar rallied, and rates in Europe went negative. Now Europe is much better, so the euro is up and the dollar is down. In fact, Draghi is talking about how he wants to exit all that yucky QE and ZIRP stuff. I don’t blame him. If there’s any big news from Jackson Hole this weekend, it’ll probably be from Mario instead of Janet.

The key takeaway is that the investing environment continues to be favorable for investors. But remember that the weak U.S. dollar is being a big help for us. Now let’s look at our recent earnings reports.

This Week’s Buy List Earnings Reports

We had three Buy List earnings reports this week. Get ready for an earnings lull, because these will be the last ones for a while. RPM International will probably be the next to report sometime in early October. After that, Signature Bank will most likely kick off the Q3 earnings season sometime around October 21.

After the closing bell on Wednesday, HEICO (HEI) reported fiscal Q3 earnings of 53 cents per share. That was in line with Wall Street’s consensus. Because HEICO is a niche player, I like to keep a close eye on their operating margin. It was 19.4% last quarter, which is quite good. Quarterly net sales rose 10% to $391.5 million. In the third quarter of last year, the company earned 49 cents per share.

Laurans A. Mendelson, HEICO’s Chairman and CEO, commented on the Company’s third quarter and year-to-date results, stating, “HEICO’s operating segments have continued to execute at a high level of profitable performance, and I am very pleased with the record financial results. These outstanding results reflect record net sales and operating income for the first nine months of fiscal 2017 within both the Flight Support Group and Electronic Technologies Group, achieved through increased demand for the majority of our products. Additionally, our subsidiaries continue to deliver strong cash flows in support of our overall corporate strategy of high cash-flow generation.

Now for the good news: HEICO also raised its guidance for full-year earnings. They previously expected full-year net income growth of 12% to 14%. They now expect net income growth of 14% to 16%.

Unfortunately, the company doesn’t provide per-share guidance, so we need to bust out some math. Last year, HEICO made $1.86 per share. Shares count is up 1.8% this year, so factoring that in, the new guidance implies $2.08 to $2.12 per share. Since HEICO has already made $1.53 per share through the first three quarters; that implies Q4 earnings of 55 to 59 cents per share.

Wall Street had been expecting 55 cents for Q4 and $2.09 for the entire year. It seems like it was only last week that HEICO was downgraded by Deutsche Bank. Because it was. The shares jumped 2.8% in Thursday’s trading. I like this company a lot. HEICO remains a buy up to $90 per share.

On Thursday morning, Hormel Foods (HRL) said they made 34 cents per share for their fiscal Q3 (ending July 31). That was three cents below Wall Street’s estimate. Sales fell 4.4% to $2.2 billion. For comparison, Hormel made 36 cents per share in last year’s Q3.

So what caused the earnings miss? The major problem is that there’s been a surge in demand for bacon. Normally, that’s a good thing, but Hormel hasn’t been able to catch up with the cost change. Their CEO said that since April, porl-belly prices have doubled. Hormel said they probably will not be able to raise prices until October. As a result, the company’s profit margins got squeezed hard last quarter.

That’s not all. Hormel also had a poor quarter from their Muscle Milk unit, which they’ve spent heavily on. Plus, their turkey unit continues to see poor sales. The silver lining is that Hormel’s grocery-store biz, with brands like Skippy Peanut butter, is doing well.

This was a frustrating quarter for Hormel, but these are solvable issues. With an earnings miss, it’s important to dissect the problems. Are they transitory, or do they go to the heart of the company’s business model? With Hormel’s quarter, it’s more about the environment.

Hormel has also been busy on the M&A front. Last week, the company announced the acquisition of Fontanini Italian Meats and Sausages. This week, they spent $104 million to buy Cidade do Sol, a Brazilian meat company.

Now for guidance. Hormel is lowering its full-year guidance range to $1.54 to $1.58 per share, from the previous range of $1.65 to $1.71 per share. For the first three quarters, Hormel made $1.17 per share, so their guidance means a Q4 range of 37 to 41 cents per share. Wall Street had been expecting 46 cents per share.

This is tough news. The shares dropped 5.4% on Thursday and touched a new 52-week low. In 2015, Hormel could do no wrong. Now they seemingly can do no right. I want to see some improvement here before I feel confident about Hormel.

Also on Thursday morning, JM Smucker (SJM) said they made $1.51 per share for their fiscal Q1. That was ten cents below estimates. Quarterly revenue fell 3.7% to $1.749 billion.

The main culprit was SJM’s Folger’s coffee unit. Sales at Folger dropped by 8%, while operating profits plunged 29%. The company raised coffee prices earlier this year, but then lowered them in July. Smucker’s biggest business, which is pet food, had a sluggish quarter. Sales rose by just 0.5%.

“While our first quarter results fell slightly short of our projections, primarily driven by lower than anticipated volume for Folgers® roast and ground coffee, we have taken actions to improve our competitive positioning for Folgers®. As a result, volume trends are improving. In addition, we remain pleased with the performance of the remainder of our coffee portfolio and look forward to the launch of new coffee products later this fiscal year,” said Mark Smucker, Chief Executive Officer. “We are also pleased with the progress on our cost-management programs, as we continue to deliver on our synergy and cost-savings targets. Across all our businesses, we are executing on our strategic plan that provides a clear path to sustainable, long-term growth by delivering on current consumer and retail trends.”

Smucker also lowered its full-year forecast. The initial guidance was for $7.85 to $8.05 per share. Now Smucker sees FY 2018 earnings of $7.75 to $7.95 per share. Bear in mind that’s a decrease of about 1% at either end.

Shares of SJM dropped 9.5% on Thursday. This was a very disappointing quarter for Smucker, but the selloff gives them a decent valuation, especially if the new guidance is accurate. I feel better about SJM’s earnings than I do about Hormel’s. This week, I’m lowering my Buy Below on Smucker to $118 per share.

Buy List Updates

I have a few quick updates for some of our Buy List stocks.

On Wednesday, Stryker (SYK) said that it’s doing a voluntary recall of “specific lots of Oral Care products sold through the company`s Sage Products business unit.” The problem seems to have come from a third-party provider. Fortunately, Stryker said that it’s not aware of any serious adverse effects.

Earlier Stryker gave full-year guidance of $6.45 to $6.55 per share. Now the company expects to come in at the low end of that range. For Q3, Stryker expects to be at the low end of the previously announced range of $1.50 to $1.55 per share.

This is disappointing news, but hardly enough to shake my confidence in Stryker.

I also wanted to follow up on Ross Stores (ROST). The deep discounter had a very good earnings report last week, but I wasn’t able to see the market’s reaction until after I sent you the newsletter. On Friday, shares of ROST jumped 10.7%. Yesterday, the shares broke above $60 for the first time in two months. Our patience is being rewarded. Ross is a buy up to $61 per share.

Three weeks ago, Cinemark (CNK) reported earnings of 44 cents per share. The market initially reacted favorably, but then it changed its mind. CNK has been trending lower ever since. At one point, shares of CNK fell eight times in nine days. Frankly, I should have lowered our Buy Below earlier, but I’ll do it this week. Cinemark is now a buy up to $36 per share.

That’s all for now. Next week is the final week of trading before the Labor Day holiday. On Wednesday, the government will revise the Q2 GDP figure. The initial report showed growth of 2.6%. On Friday, the Labor Department will release the August labor report just ahead of the Labor Day weekend. I’ll try not to belabor the point. The last report showed unemployment at 4.3%, which tied a 16-year low. Be sure to keep checking the blog for daily updates. I’ll have more market analysis for you in the next issue of CWS Market Review!

– Eddy

Named by CNN/Money as the best buy-and-hold blogger, Eddy Elfenbein is the editor of Crossing Wall Street. His free Buy List has beaten the S&P 500 eight times in the last ten years. This email was sent by Eddy Elfenbein through Crossing Wall Street.
2223 Ontario Road NW, Washington, DC 20009, USA

#Samsung’s Galaxy 8 launch, #Trump’s Phoenix rally, vanilla panic

Good morning, Quartz readers!


Angola heads to the polls. For the first time in nearly 40 years, the country will have a new president as 74-year-old Jose Eduardo dos Santos is stepping down reportedly due to health issues. Defense minister João Lourenço is the favorite to succeed him despite significant opposition.

Samsung unveils its next flagship phone in New York. The South Korean giant will likely tout the quality control that went into producing the Galaxy Note 8 (paywall). The company is releasing the phone a year after the Note 7 debacle, when widespread incidents of phones catching fire prompted a global recall of the smartphone.

Whole Foods shareholders vote on Amazon’s bid. The organic-grocery chain agreed in June to a $13.7 billion takeover by Amazon, whose offer at $42 per share was 27% higher than Whole Foods’s last trading price before the bid announcement.

Israel and Russia hold Syria talks. Prime minister Binyamin Netanyahu will meet with president Vladimir Putin in Sochi on the Black Sea to discuss the conflict in Syria. Israel has pushed back on the encroachment of Iranian forces—many equipped with Russian military artillery—on the Israel-Syria border.


The US Navy will relieve an admiral from his post after a string of accidents. Joseph Aucoin will be removed from his position as three-star commander of the Seventh Fleet in Yokosuka, Japan, following four collisions since January including two deadly ones. Divers are still searching for remains of the 10 missing US sailors from the USS John McCain, which collided with an oil tanker near Singapore on Monday.

A powerful typhoon lashed Hong Kong. The city raised the highest No. 10 typhoon signal for the first time in five years, as severe typhoon Hato moved closer to the city this morning local time. Trading was suspended on the stock exchange, and hundreds of flights were canceled.

Trump held a combative rally in Phoenix, Arizona. The president reiterated that he would build the Mexican border wall, implied he would pardon former sherif Joe Arpaio, and used the occasion to rail against CNN and the rest of the press (paywall), accusing it of “distorting” his response to Charlottesville. The rally ended with police using tear gas and pepper balls to disperse protestors.

Major mutual funds marked down their Uber investments.Vanguard, Principal, and Hartford Funds marked down their holdings(paywall) by 15% for the quarter ended June 30, while T. Rowe Price cut the estimated price of its Uber shares by about 12%. Uber’s shares don’t trade publicly, so funds must provide estimates of their holdings every quarter.


Gideon Lichfield on “blood and treasure,” the phrase Trump keeps using about Afghanistan. “‘Blood and treasure’ obviously just means ‘lives and money.’ But nobody ever writes about the ‘blood and treasure’ that will be lost to a tsunami, an Ebola outbreak, or the opioid epidemic. It’s specifically a war cliché—a kind of rhetorical cape that writers and politicians throw over their shoulders to lend their opinions a little more gravitas.” Read more here.


Risk indicators / are rising as Dalio / says, “I told you so.”


Longevity is the enemy of workplace satisfaction. People 35 and older are twice as likely to hate their jobs.

A US war with North Korea could rapidly envelop Asia. The proximity of China, Japan, and Russia could quickly pull in several Asian powers.

Economists still can’t decide whether the minimum wage is a good thing. If wage floors are effective, they would upend orthodox economic theory.


A Madagascar cyclone made vanilla four times more expensive. Prices just hit a record high, and artificial alternativesdon’t taste the same.

Doing the Macarena could be illegal in Saudi Arabia. A teenager was arrested after a video of him doing the dance went viral, weeks after a singer was arrested for “dabbing” at a concert.

The Hallmark Channel is really, really popular. Known for its feel-good shows with happy endings, Hallmark is one of the few non-news channels to record a surge in ratings (paywall) last year.

The Australian tiger snake’s venom hasn’t evolved in 10 million years. Its venom is so powerful that it’s never had to counter-adapt to evolutionary changes among prey.

Scientists are collecting poop from elite athletes. Their microbes may carry the secret to endurance—which could be offered in pill form.

Our best wishes for a productive day. Please send any news, comments, tiger snake antivenom and Hallmark soaps to hi@qz.com. You can follow us on Twitter for updates throughout the day or download our apps for iPhone and Android.

Trump’s Afghanistan strategy, BHP’s shale sale, baby paleo diets

Good morning, Quartz readers!


Brussels completes its review of the Bayer-Monsanto merger.The European Commission had extended its review of the $66 billion deal by two weeks. Bayer said it would divest assets to pass antitrust scrutiny by the body, which rules on mergers in the European Union.

Salesforce reports second-quarter earnings. Investors are expecting more information on how the cloud-software giant’s string of acquisitions in the past year, totaling more than $4 billion, are faring. Two acquisitions in focus are Commerce Cloud, an e-commerce service provider formerly known as Demandware, and Einstein, an AI platform.

Indian bank unions go on strike. Employees of nine public sector banks will stay home to protest government reforms to the industry.


Donald Trump laid out his Afghanistan strategy. In a speech that was short on specifics, Trump said he decided a “hasty withdrawal would create a vacuum for terrorists,” and that the US would commit more troops to the country. He also said the US would put more pressure on Pakistan to do more in the fight against terrorists that operate on its border with Afghanistan.

BHP Billiton said it would sell its US shale assets. The Anglo-Australian mining giant’s decision is a win for activist hedge fund Elliott Management, which said that poor management by BHP has destroyed some $40 billion in shareholder value. BHP is the eighth-largest shale gas producer in the US.

Danish police searching for a missing journalist found a female torso. Authorities have yet to confirm whether the headless and limbless torso belongs to Swedish journalist Kim Wall, who disappeared after boarding a submarine belonging to Danish inventor Peter Madsen on Aug. 10. Madsen was charged with manslaughter yesterday after he admitted to burying her body at sea.

Fujitsu looked to exit the cellphone-making business. Daunted by competition from bigger rivals, the Japanese company could open bidding for its mobile unit as early as next month, the Nikkei reported. Lenovo, CVC Capital Partners, and Polaris Capital are potential buyers.

A total solar eclipse awed America. The rare phenomenon, viewable from the entire continental US for the first time in 99 years, caused traffic jams caused traffic jams, medical emergencies, and wildlife dangers—and the return of Bonnie Tyler’s 1983 hit to the top of the charts. Most donned protective eye-gear, but the US presidentwas not among them.


Chase Purdy on the paleo diet being marketed to babies.“Meals include liquified uncured bacon with organic kale and butternut squash, chicken with peas and carrots, even beef with kale and sweet potato. The product is sold in packs of six 4-ounce pouches for about $27.” Read more here.


Debt ceiling? Don’t fret: / Mnuchin, McConnell say / “It’s under control.”


Spotify playlists are the new albums. The streaming service is forcing artists to reshape how they make music.

You’re more likely to achieve the “American dream” if you live in Denmark. Far from being the land of opportunity, the US has very low social mobility.

Tech companies aren’t special. They deserve regulatorywatchdogs like their old-economy peers.


Quartz Creative wants your help sending Hugo to SXSW 2018.Vote here and our chatbot, Hugo, could be headed to Austin to lead a panel on machine learning, natural language processing, and its own engineering. Very meta.


An Antarctic microbe could reveal the origin of viruses. The single-celled organism is host to a fragment of DNA that can build a capsule around itself.

A good credit score is, well, hot. When it comes to dating in the US, a new survey shows that the three-digit number ranks above looks, ambition, and a sense of humor.

Venus flytraps can count. It’s how their sensors tell the difference between struggling prey and a raindrop.

You can’t charge your Tesla and make a cup of tea at the same time. The average UK household would blow the main fuse if it tried.

HIV could treat cancer. The virus’s ability to inject DNA into cells(paywall) is being repurposed for a revolutionary immunotherapy.

Our best wishes for a productive day. Please send any news, comments, good credit scores, and Venus flytraps to hi@qz.com. You can follow us on Twitter for updates throughout the day or download our apps for iPhone and Android.