#Uber exec resigns, Dennis Rodman in Pyongyang, meerkat gang scents

Good morning, Quartz readers!


Theresa May meets with Emmanuel Macron. The UK prime minister hoped to arrive in France with a mandate for her Brexit plans. Instead, she’ll meet the pro-EU French president weakened by a surprising snap election that cost her party its majority.

The US attorney general is in the hot seat. Jeff Sessions will facesome pointed questions from the Senate intelligence committee, which is probing Russian interference in the US election. He is at the center of two overlapping controversies (paywall): whether the Trump campaign colluded with the Kremlin, and whether the administration obstructed investigations into its conduct.

The US Fed begins a two-day meeting on interest-rate policy.Investors will watch for clues about the pace of interest-rate hikes for the rest of the year. With the labor market tightening, most observers expect the Fed will increase the benchmark interest rate. The announcement is due tomorrow. Today the Labor Department will release (pdf) the Producer Price Index for May.


Donald Trump had a bad day in court. The Ninth Circuit Court of Appeals said the president’s travel ban “runs afoul” of US discrimination law (paywall), citing one of his tweets as evidence. Meanwhile Maryland and Washington, DC filed a lawsuit claiming that Trump’s hotels violate the constitution’s anti-corruption law because they accept payments from foreign governments.

Trump announced eight nominations for US attorney posts. In a bizarre situation, over 90 positions are still unfilled as the former attorneys either resigned after Trump’s inauguration or were let go. US attorneys are responsible for prosecuting serious financial fraud, public corruption, and other federal crimes. The eight are the much-belated first wave of candidates.

A controversial Uber executive resigned. Senior VP Emil Michael, who played a prominent role in most of the company’s high-profile scandals, has left the company. Beleaguered CEO Travis Kalanick is said to be pondering a leave of absence after a damning investigation into Uber’s toxic culture. Recommendations from that investigation will be released to employees today.

Dennis Rodman headed back to North Korea. The former NBA star is one of the few Americans to have met leader Kim Jong-un (a basketball fan) and has made a series of trips to the reclusive nation. The purpose of Rodman’s visit is unclear. His last trip involved an exhibition game.


Oliver Staley on the San Francisco tech firm whose employees never show up for work: “Automattic’s office at 140 Hawthorne went on the market after CEO Matt Mullenweg came to the realization not enough employees used it. ‘We got an office there about six or seven years ago, pretty good lease, but nobody goes in it. Five people go in it and it’s 15,000 square feet. They get like 3,000 square feet each.’” Read more here.


Gala, Fuji, Rome / The best Apples stay crisp and / are not overpriced.


Future shopping malls will have no stores. Newly converted malls focus on food, theaters, performance stages, and office space(paywall).

The upper middle class is hogging everything. It’s not just money: The top 20% are hoarding professional and educational opportunities.

Bromances are the solution to toxic masculinity. The social trend may reduce the risk of mental health problems, violence, and suicide.


NASA will deploy fake technicolor clouds. The space agency will soon launch a rocket that disperses “vapor tracers” in the sky above Virginia, to track particles that are ionized by solar and cosmic radiation.

Meerkat gangs have signature scents because of microbes in their anal pouches. The odors that help meerkats identify friends and family come from their shared bacteria.

The US post office was once a hotbed of innovation. Decades of mismanagement have turned it into an extremely clunky bureaucracy.

Egypt wants to outlaw foreign names. A bill in parliament would imprison parents who give their children names like “Mark” and “Lara.”

A New York baker is making internet trolls literally eat their words. Kat Thek turns salty internet comments into “troll cakes.”

Our best wishes for a productive day. Please send any news, comments, troll cakes, and banned baby names to hi@qz.com. You can follow us on Twitter for updates throughout the day or downloadour apps for iPhone and Android.

#Russia’s “anti-corruption” protests, #UK election aftermath, Korean menstrual cups

Good morning, Quartz readers!


The Kremlin braces for nationwide protests. Thousands of people across 200 cities are expected to show up for anti-corruption rallies helmed by Alexei Navalny, lawyer and vocal critic of Russian president Vladimir Putin. In March Navalny staged a similar protest that drew 8,000 individuals and resulted in over 1,000 detentions, including Navalny himself.

Moon Jae-in talks policy in South Korea’s national assembly.The newly appointed president is addressing the country’s legislature for the first time since his electoral victory. He is expected to ask the opposition to support a 11.2 trillion won ($9.95 billion) stimulus package to help create jobs.

The Philippines celebrates independence day. Rodrigo Duterte was absent from the customary ceremony in Manila—which would have been his first as president—in order to tend to matters in Marawi, where government forces have been combating Islamic militants. The Philippine military successfully raised the flag in the embattled city in time for the holiday, but fighting continues.


Theresa May reshuffled her cabinet. The UK prime minister placed two prominent pro-Brexit ministers (and former rivals) in positions of power. The moves are being interpreted as a way ofappeasing members of her Conservative Party, after her call for an early election backfired spectacularly.

France closed the first round of its parliamentary elections.Early poll results show president Emmanuel Macron’s centrist party and its ally winning a majority 32.32% of the vote. If the results are confirmed in a second round of voting on June 18, Macron will preside over one of the largest majorities in post-war France.

Qatar held steady in the Middle East. After three neighboring Gulf states expelled Qatari citizens, Qatar on Saturday reassured its own foreign residents that it would not be responding in kind. On Sunday, mediator Kuwait announced that Qatar was open to listening to the concerns of its neighbors.

Puerto Rico decided it wants to be the 51st US state. In a referendum, Puerto Ricans voted overwhelmingly in favor of applying for statehood. The final decision, though, is in the hands of the US Congress—and a Republican-led legislative branch isn’t likely to welcome a new Democrat-leaning state.

Muammar Gaddafi’s son was freed from captivity. Saif al-Islam Gaddafi was released by militia in Zintan, Libya. It’s not clear where he went; he is wanted by the International Criminal Court for crimes against humanity during the rebellion against his father’s rule, and he faces a death sentence meted out by courts in Tripoli.

Batman died. Adam West, who played the Caped Crusader in the campy 1960s TV and film versions of Batman, passed away at the age of 88.


Dan Knopf on why rich people in the US don’t display their wealth: “Instead of spending money on consumer products, the rich increasingly focus their spending on ‘nonvisible, highly expensive goods and services’ that allow them to have time to gain social capital and foster it in their children.” Read more here.


There’s a bad-writing crisis in economics. Economists have a duty to strive for clarity in communications to the public, but papers and communiques in the field are tangles of jargon.

When dealing with loss, it’s totally normal to cut off your hair.Researchers say it’s an attempt to control change.

Women’s workwear has lost all stylistic consistency.Increasingly liberal dress codes for the office have driven clothing companies into a state of confusion.


Sign up for the Cannes Daily Brief, our pop-up newsletter on the world’s premier celebration of creativity in advertising. Quartz journalists will be at the Cannes Lions International Festival of Creativity from June 19 to 23 to report on industry moments, trends, and surprises. Whether or not you’ll be on La Croisette, sign up to stay informed about what’s happening on the ground and what it means for the media business.


Ikea sent some of its engineers to live in a Mars simulation.The goal was to answer questions like “What does comfort mean for compact living?” and “How do we feel in small spaces?”

Cary Grant used to drop acid 100 times a year. In the late 1950s, during the heyday of psychedelic research, the American actor was one of the first to go all-in on LSD therapy.

Korea exports menstrual cups, but they can’t be sold legally there. It’s one of many symptoms of the country’s alarming lack of attention to women’s health issues.

Pickup basketball is Silicon Valley’s answer to golfing with your boss. There’s a twice-weekly game at Stanford Universitywhere networks are built and million-dollar deals get done.

Chefs in California cooked a pizza 1.2 miles (1.9 km) long. Theworld record-breaking pie weighed over 17,000 lbs (7,800 kg)—more than most elephants.

Our best wishes for a productive day. Please send any news, comments, giant pizzas, and Hollywood acid trip stories tohi@qz.com. You can follow us on Twitter for updates throughout the day or download our apps for iPhone and Android.

Bespoke Brunch Reads: 6/11/17

Federal Debt

Twitter investor says US government is bad at managing its finances by Alexandra Scaggs (FTAV)

A brilliant debunking of the deeply problematic attitude that the US government deficit is effectively an income statement. If you read one thing this weekend, make it this. [Link; registration required]

U.S. readying ‘plans and backup plans’ if debt ceiling isn’t raised soon, Mnuchin says by Damian Paletta (WaPo)

A reminder that the debt ceiling will likely be hit by the end of the summer and that the US Treasury is being forced to check for coins under the couch cushions, rather than issue debt for which the markets have ample appetite. [Link]


The Media Have Been Played by Trump’s Tweets by Bill Murray (Real Clear Politics)

Murray argues that the media is responsible for Trump because they cover his tweets. [Link]

Under Trump, regulation slows to a crawl by Danny Vinik (Politico)

While the lack of new regulations published under the Trump Administration is likely to win cheers from conservatives, it means that the White House is doing very little to alter the course of policy; doing so would require changes to regulations that already exist. [Link]

UK Update

How May’s Sure Thing Became a Political Disaster for the Ages by Tim Ross, Svenja O’Donnell and Alex Morales (Bloomberg)

A brutal tick-tock of the Conservative party reaction to their painful election result Thursday in the UK, which saw their majority in Parliament evaporate in the midst of Brexit negotiations. [Link; auto-playing video]

How Britain Voted by Gregor Aisch, Matthew Bloch, Kenan Davis, Stephen Farrell, Troy Griggs, Rich Harris, and Adam Pearce (NYT)

Less of a read and more of a graphic run-down of the changes in voter preference in the UK this week, with rundowns of the swings in key constituencies, the national swing to Labour, big youth turnout, and a return to dominant position for the two largest parties. [Link]

Britain fears labor shortage as EU workers stay away by Stephen Beard (Marketplace)

With Article 50 triggered and Brexit negotiations underway, the UK’s effort to stem migration via Brexit looks to be creating collateral economic damage already as employers are unable to find workers in several industries. [Link]

All About Amazon

Amazon Introduces Discounted Monthly Prime Offer for Customers Receiving Government Assistance (Amazon)

In an interesting move this week, Amazon has started to segment its Prime customer base by offering consumers receiving government assistance programs (such as SNAP, often referred to as ‘food stamps’) discounted membership. The move speaks to extremely high market penetration among high income consumers and the company’s relentless pursuit to open new markets. [Link]

Some of Amazon’s own brands are becoming super popular online by Jason Del Rey (Recode)

The most popular batteries purchased online, the third-most purchased baby wipe, and a litany of other basic products are all part of Amazon’s private label AmazonBasics. [Link]

Modern Life

Apple is going to let podcast creators — and advertisers — see what listeners actually like by Peter Kafka (Recode)

Up until now, publishers were unable to see how their listeners interacted with podcasts on Apple’s app. Now, that’s changing, creating both opportunity and risk for advertiser-dependent podcasts. [Link]

What are memes — and how do they get kids in trouble? by Elizabeth Weise and Diana Kruzman (USA Today)

A useful background on the evolution of memes, visual in-jokes that communicate ideas quickly and efficiently among digital native young people. [Link]

Your Twitter Outrage May Require Libel Insurance by Polly Mosendz (Bloomberg)

An increasingly popular feature of “umbrella” insurance coverage includes protections against being sued for libel, a risk that had previously only been something journalists were regularly exposed to. [Link]

Long Reads

The Queen Bee of Downtown Durham by Iza Wojciechowska (Bitter Southerner)

Urban beekeeping may seem like a fever dream hatched in the bowels of a Silicon Valley plot line, but the deployment of more than one hundred hives across the Research Triangle Park area by Bee Downtown is a testament to the value of honey pots in cities. [Link]

Take a Look: An Oral History of Reading Rainbow by Jake Rossen (Mental Floss)

A look inside the origins of a fantastic piece of Americana, the PBS program which helped keep kids engaged with books during the summer months. [Link]

The opioid crisis changed how doctors think about pain by Sarah Kliff (Vox)

A deep dive into the sources of the drug epidemic ravaging whole swathes of the country, where pain was swept away with a literal sea of prescription drugs which have now created a huge demand for opioids found in street drugs too. [Link]

He’s heating up, he’s on fire! Klay Thompson and the truth about the hot hand by Tom Haberstroh (ESPN)

An investigation of the folk lore, statistics, and impact of the hot hand in sports, especially professional basketball. [Link]


Elon Musk: The Man, the Myth, the Risk by Charley Grant (WSJ)

A cogent rundown of the reasoning behind Tesla’s investors, who have completely foregone income statements and balance sheets in pursuit of a far grander vision. [Link; paywall]


The law that created the billion-dollar scaffold industry has turned city sidewalks into an obstacle course by Aaron Elstein (Crain’s New York)

Ever wonder why New York City sidewalks are so often framed by metal scaffolding? The explanation is a wave of laws designed to prevent building materials from striking pedestrians. [Link]

The Economy

Anxious About the Economy? It’ll Still Set a Record by Tim Duy (Bloomberg)

There’s ample reason to suspect that while the current economic expansion will inevitably end in recession, that kind of pullback in activity is still a long way off. [Link]


Retirees flock to Latin America to live an upper-class lifestyle on $1,500 a month by Jim Wyss (The Charlotte Observer/Miami Herald)

The Social Security Administration sends checks to around 380,000 seniors living abroad, up about 50% over the last decade, as US retirees seek lower cost of living in a variety of countries across Latin America. [Link]

Have a great Sunday!

Bespoke Investment Group, LLC

105 Calvert Street, Suite 100

Harrison, NY 10528



Twitter: @bespokeinvest

Weekend edition—Fickle voters, cryptocurrency gold rush, Korean megachurches

Good morning, Quartz readers!

Voters—such fickle creatures. Just ask Theresa May. She campaigned against Brexit, then had to reinvent herself as a true believer in it when the British unexpectedly revolted against the EU and she was thrust into the prime ministership. Thinking she could solidify her majority, she held a snap election this week—but the public that had voted for Brexit turned on her and took away the Conservatives’ majority in Parliament.

Scotland, meanwhile, voted against independence from the UK in a referendum in 2014. The following year, in a general election, it gave the pro-independence Scottish National Party a landslide victory. Emboldened, the SNP campaigned for this week’s election on a promise to hold a second referendum. Result: It lost a third of its seats—most of which, adding insult to injury, went to May’s Conservatives.

Across the channel, meanwhile, consider Emmanuel Macron, who had never held elected office before winning the French presidency last month against established party grandees and the far-right’sRussian bot army. This Sunday, his brand new party looks set to sweep the first round of parliamentary elections, defying predictions that a centrist message wouldn’t resonate across hundreds of diverse local races.

It seems our desire for instant gratification has conquered politics. Voters are channel-hopping, snacking on ideologies and political styles, moving on as soon as they’re bored. In that light, Donald Trump is a political genius: His slippery, shifting positions on just about everything command attention and perfectly reflect the restless mood of the times. People are eager for something—anything—different, and damn any concerns about consistency.

There is something to admire in this increased ideological flexibility, given how quickly our world is changing and how stale many parties’ platforms have become. But gratification isn’t satisfaction, and entertaining politics isn’t good government.—Jason Karaian


The cryptocurrency gold rush. The tech world is going mad for “initial coin offerings”—a sort of cross between a Kickstarter campaign and an IPO, which allows people to buy shares in a new technology as it’s being developed, bypassing venture capitalists. Joon Ian Wong reports on how ICOs could create a new business model for internet startups.

How corporations are wrecking America’s health—and what to do about it. Columbia University economist Jeffrey Sachs and Lown Institute president Vikas Saini dissect the impact of corporate prerogatives on the health of the American public. Access to healthcare is too expensive; the American lifestyle is unhealthy; and despair over the first two conditions is taking hold and stifling hope. But Donald Trump’s American Health Care Act, while deeply flawed, could be a chance to make changes that will help people and also unify the country.

The United States of Zuckerberg. The Facebook CEO has set a goal to visit 30 American states—all those he has never been to—by the end of 2017. Groundwork for a political campaign, or just getting to know Facebook’s users as people instead of data? ThisZuckerberg tour tracker by Annalisa Merelli and Christopher Groskopf will, as he travels, follow the demographics, economics, and issues of the places he visits.

The days and nights of Elon Musk. In a recent TED talk the Tesla and SpaceX founder casually revealed that he spends about 2-3% of his workweek on his latest venture, the Boring Company. Michael Coren went digging through transcripts and profiles to piece together how Musk divides up his day while still managing to get a respectable six or so hours of sleep a night.

How to explain anything to anyone, according to Neil deGrasse Tyson. Katherine Foley interviews the American astronomer, who offers excellent and timely advice on communicating science—and more broadly, about how to improve your communication in general. Check out his answer to the question: “What’s your favorite data set?”


Brazil’s incredible corruption machine. Construction giant Odebrecht’s “Structured Operations Division” had hundreds of millions of dollars in budget and hundreds of politicians up and down Latin America in its pocket. Michael Smith, Sabrina Valle, and Blake Schmidt in Businessweek tell the tale of what may have been the world’s biggest corporate bribery operation, and how a rat in a barbecue grill brought it all crashing down.

Is the US headed for divorce? Americans are increasingly dividing themselves into “culturally and ideologically homogeneous enclaves,”David French writes in the National Review—living in separate locations, consuming separate media, and believing in different ideologies. One of the few things “red” and “blue” tribes have in common is how much they dislike and distrust the other team. To preserve the union, he suggests, Americans need to embrace tolerance, a virtue that’s out of favor today.

How spiders think with their webs. Two biologists have put forth the controversial idea that spiders may outsource cognitive tasks to their webs, much as objects from grocery lists to iPhones have been theorized as extensions of the human mind. Writing in Quanta Magazine, Joshua Sokol explores the meaning of cognition and the interplay between the brain, the body, and the greater mind in humans and animals alike.

The Korean megachurches’ succession problem. As South Korea industralized and urbanized in the 1970s and 1980s, Protestant megachurches sprang up. In time, several used their members’ tithes to add hospitals, schools, and media outlets to their real-estate fortunes, much like the country’s chaebol conglomerates. But as their aging founders now tap their offspring as successors,Ben Jackson writes in Korea Exposé, many followers are fearing for the survival of their religion.

Road-trippin’ with Frank Lloyd Wright. Cross-country road trips are the stuff of American legend. When helmed by an actual American legend, they’re the stuff of dreams. For over 20 years Frank Lloyd Wright, America’s most revered architect, led a bi-annual road trip through the southwest. He traveled like he created—with radical style, a passion for the landscape, and a DIY attitude. Patrick Sisson weaves together accounts from Wright’s apprentices of life on the road for Curbed’s week-long celebration of his 150th birthday.

Our best wishes for a relaxing but thought-filled weekend. Please send any news, comments, spider webs, and initial coin offerings tohi@qz.com. You can follow us on Twitter here for updates throughout the day, or download our apps for iPhone and Android.

CWS Market Review – June 9, 2017

CWS Market Review

June 9, 2017
“It’s human nature to find patterns where there are none and to find
skill where luck is a more likely explanation.” – William Bernstein

Next week is the big Federal Reserve meeting. Wall Street has already convinced itself that the central bank will again raise interest rates. I’m afraid they’re right. As I’ve said for the past few weeks, I think a rate hike now is a mistake. How big of a mistake is still to be determined. In this issue, I’ll discuss what the Fed’s move means for us and our portfolios.

The good news for us is that the low-volatility rally continues to roll on. In the last 15 trading sessions, the S&P 500 has risen 11 times. The index’s single biggest decline was a mere 0.28% drop. That’s barely a nick. Here’s a great stat I saw from Callie Bost. She noted that since 1990, there have been 15 trading days where the difference between the daily high and low was less than 0.28%. Four of those have come in the last month.

There seems to be an odd paradox. The world appears to grow more volatile while the stock market grows more serene. Or, perhaps this isn’t the paradox it seems. Maybe investors are retreating from news of terrorism and missile tests for the relative comfort of stock investing. Whatever the cause, my top concern is an overly zealous Federal Reserve that looks to contain inflation, which is hardly a problem.

We got a nice earnings report this week from JM Smucker. The jelly people handily beat Wall Street’s estimates thanks to cost-cutting. I’ll have all the details in a bit. I’ll also give you some updates on our Buy List. But first, let’s look at the rate hike that’s almost certainly coming our way next week.

Get Ready for a Fed Rate Hike

On Tuesday and Wednesday of next week, the Federal Reserve gets together for another policy meeting. The two-day affair usually gets a lot of attention because it’s followed by a press conference from Fed Chairwoman Janet Yellen.

Much of Wall Street has this meeting circled on their calendars. They figure that if the Fed is going to strike, it’ll do it in June. At this two-day meeting, the Fed also updates its economic projections. These are more often referred to as “the blue dots” in honor of the Fed’s scatter plots.

Earlier this year, the consensus on the Fed was that it would raise interest rates three times this year plus three more times in 2018 and 2019. I thought this was nuts. I reassured readers that the Fed always starts out sounding as hawkish as it can but then gradually gives way. This time, it hasn’t.

During this cycle, the Fed first raised rates in December 2015. They followed that up with another raise in December 2016, and again in March 2017. Traders in the futures market think there’s a 93.5% chance that the Fed will hike next week. If they’re right, that would move the target for the Fed funds rates from 1% to 1.25%.

What about after that? Traders see the Fed standing pat for a few months. I think that’s right. But by the December meeting, another rate hike is in play. Right now, the odds are very nearly even money for a December hike.

I’ll briefly restate my opposition. The Fed should only move once there are signs that inflation is heating up. Those signs aren’t here yet. The commodity markets aren’t rallying. Oil has been falling lately. The latest CPI reports have been very tame. We’ll get the May CPI report on Wednesday, the morning of the Fed’s announcement.

Last week’s employment report was not terribly strong. The U.S. economy created just 138,000 net new jobs. Economists had been expecting 185,000. The numbers for March and April were revised lower. The growth in wages is actually decelerating slightly. The yearly growth number fell from 2.51% in April to 2.46% for May.

I don’t want to sound overly alarmist. There have been improvements in the economy. The last earnings season was quite decent. But as far as interest rates go, I think the Fed needs more time. I’m particularly concerned to see long-term interest fall. After the election, long-term yields soared on the prospects of greater economic growth. To be fair, yields at the long end had been rising since the summer.

We heard a lot about the Trump Trade, but that started to unravel in December. Three months ago, the 10-year Treasury was yielding over 2.6%. Lately, it’s gotten close to 2.1%. If the Fed follows through with its rate hike, the famous Two/Ten Spread will probably fall below 70 basis points. That would be a nine-year low. That’s still not in the danger zone, which is 0.00, but it’s getting close. The hidden story here is that the Fed’s “ceiling” for rate increases is probably a lot lower than folks want to admit.

What effect will the Fed have? Higher short-term rates would come as a relief to many financial stocks. In fact, we saw a nice bounce in Signature Bank (SBNY) on Thursday. At the opposite end, dividend stocks will lose some of their luster. A stock that yields 3% is a wonderful thing in a 0% interest rate world. It becomes gradually less impressive as interest rates climb higher. Now let’s look at our most recent Buy List earnings report.

Smucker Beats Earnings Thanks to Cost-Cutting

On Thursday morning, JM Smucker (SJM) reported fiscal Q4 earnings of $1.80 per share. That was eight cents more than expectations. For the whole fiscal year (ending in April), Smucker made $7.72 per share. Their previous guidance had been for $7.60 to $7.70 per share. In February, the company lowered the top end of its full-year forecast by five cents per share. As it turned out, the original guidance was pretty close to the mark.

“In fiscal 2017, we grew adjusted EPS by 7 percent over the prior year,” said Mark Smucker, Chief Executive Officer. “In the new fiscal year, we continue to execute our strategic plan for sustainable, long-term growth by capitalizing on changes in consumer preferences and the retail environment. We will fuel the momentum of our growth brands like Smucker’s® Uncrustables®, Nature’s Recipe®, and Café Bustelo®, while supporting our base businesses in coffee, peanut butter, pet food, and pet snacks. Accelerated cost savings and expanded capabilities are key components of our multi-dimensional strategy to deliver top- and bottom-line growth and increase shareholder value.”

Now for guidance. For fiscal 2018, Smucker said they expect earnings to range between $7.85 and $8.05 per share. That’s pretty good. Wall Street had been expecting $7.93 per share. They also said they expect net sales to rise by 1%. SJM pegs this year’s free cash flow at $775 million and capital expenditures at $310 million.

This was a good quarter for Smucker, but a lot of the earnings beat was thanks to cost-cutting. Don’t get me wrong—that still counts, but I would have liked to see more top-line growth. You can only cut costs so much.

The shares of SJM gapped up more than 2% at the open, but that didn’t last. By the closing bell, SJM closed at $128.51, for a loss of 1.81%. I should add that there’s a remote possibility that someone big will come along and try to buy SJM out. Smucker remains a buy up to $128 per share.

This earnings report will be our only Buy List earnings report until Q2 earnings season gets going in another five weeks. One outlier is RPM International (RPM). The company ended its fiscal year in May, but it won’t report its Q4 earnings until late July. Now let’s look at some recent news from our Buy List stocks.

Buy List Updates

We’re coming up on the midpoint of the year. In early July, I’ll have a more thorough breakdown of our Buy List’s first-half performance, but for now, I can say that it’s shaping up to be a pretty decent year for us.

Through Thursday, our Buy List is up 10.43% for the year, while the S&P 500 is up by 8.71%. Those numbers don’t include dividends (the Buy List yields a bit less than the S&P 500, but it’s not very much). I’ll include the dividend numbers in our first-half summary.

Our best performer on the year is Cerner (CERN), which is up by 43.78%. Second place is CR Bard (BCR), with a gain of 39.71%. We now have 11 Buy List stocks that are up more than 13% on the year. Six of our stocks are in the red. The biggest loser is Express Scripts (ESRX), which is down 12.25%.

This week, Sherwin-Williams (SHW) finally completed its $11.3 billion acquisition of Valspar. The deal was first announced 15 months ago. The problem was clearing some of the anti-trust hurdles. This is where another one of our Buy List stocks, Axalta Coating Systems (AXTA), came to the rescue. The companies decided to sell off Valspar’s North American Industrial Wood Coatings to Axalta for $420 million in cash. The regulators were cool with that, and it was a done deal.

The combined company will have revenues of about $16 billion. Sherwin said they’ll announce their Q2 earnings on July 20. At that time, they’ll provide guidance for the combined company for Q3 and all of 2017. This week, I’m lifting my Buy Below on Sherwin-Williams to $350 per share.

Intercontinental Exchange (ICE), is holding its first analyst day today, and the stock has been rallying, perhaps in anticipation. This is a good time for ICE to explain itself to the world, because too many investors see ICE as simply a trade-volume based business. In reality, ICE is becoming more dependent on data sales and technology fees. The company, for example, recently bought Bank of America’s index platform. Barron’s rightly said that Intercontinental Exchange is “misunderstood, underappreciated and underowned.” This week, I’m raising my Buy Below on ICE to $66 per share.

Earlier I mentioned that CR Bard (BCR) is our second-biggest gainer this year. As I’m sure you recall, Bard is in the process of being bought out by Becton, Dickinson (BDX). The deal calls for BCR shareholders to get $222.93 per share in cash plus 0.5077 shares of BDX.

The good news is that shares of BDX have been rallying. They’re even higher now than when the deal was announced in April. Going by Thursday’s close, Bard is valued at $320.32 per share. Bard’s actual shares are going for 2% below that. That’s quite natural since there’s a chance the deal could fall apart. I doubt it will happen, but we have to aware of the possibility.

The sizable cash portion of the deal protects Bard shareholders from large swings in BDX’s share price. It’s a relief to see that the market hasn’t turned against BDX for proposing such a large deal. The deal is expected to close this fall. If all goes well, you can expect to see that 2% discount for Bard gradually close.

That’s all for now. The big news next week will be the Federal Reserve meeting on Tuesday and Wednesday. The Fed’s decision will come out at 2 p.m. Wednesday afternoon, and it will be followed by a press conference by Fed Chairwoman Janet Yellen. The Fed will also update its economic projections (i.e. the “blue dots”). That morning, we’ll also get the CPI report for May. I doubt we had much in the way of inflation last month. 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

#May’s failed election, #Japan’s drone plans, mayonnaise energy

Good morning, Quartz readers!


France holds its first round of legislative elections on Sunday.To push through his reformist agenda, president Emmanuel Macron needs his upstart party to win a majority in the National Assembly. Judging by early opinion polls, it will. Macron, who won the presidency in early May, has pledged to cut public spending andliberalize the labor market.

Japan preps for drones. The government is expected to finalize plans that will pave the way for drone package delivery and self-driving trucks in the years ahead. The workforce has shrunk so dramatically that it’s forcing some companies, among them parcel-delivery giant Yamato, to scale back operations.

New US consumer protections go into effect. An Obama-era rule that requires financial advisers to act in a customer’s best interest will be implemented, but maybe not for long: The regulation is currently under review (paywall) by a skeptical Trump administration.


Theresa May’s election gamble failed. The UK prime minister orchestrated yesterday’s snap election in hopes of increasing the Conservative party’s parliamentary majority. Instead the Labour partygained dozens of seats, and its leader Jeremy Corbyn has called upon May to resign. It now appears the UK will have a hung parliament heading into Brexit negotiations with the EU.

Trump’s lawyer pushed back against former FBI director James Comey. Marc Kasowitz denied Comey’s assertion—made yesterday before lawmakers—that the US president pressured Comey to drop an investigation into former national security adviser Michael Flynn. Meanwhile Trump supporters got busy spinning their own version of the hearing.

China’s factory inflation cooled again. With commodity prices softening more, the producer price index rose 5.5% in May from a year ago, continuing its decline from the 7.8% mark seen in February. The consumer price index climbed 1.5% from a year ago, compared to a 1.2% annualized gain in April.

Al Jazeera weathered a cyber attack. Qatar’s flagship broadcaster said it was fending off an assault on its computer systems during a tense regional standoff with Saudi Arabia. The hacking of Qatar’s state news agency last month contributed to the rift.

JPMorgan Chase lost a possible Jamie Dimon successor.COO Matt Zames is leaving the company after 13 years, joining a growing list of possible CEOs who opted for top positions at other companies.


Leah Fessler on the five-minute trick that Instagram’s CEO uses to crush procrastination: “Our motivation to engage in an activity increases as costs decrease, says Moeller. So compared to facing down hours of work, a five-minute sprint transforms a burden into something quick and exciting.” Read more here.


Britain casts its votes/ And the pound plunges. Who won?/ The polls says “chaos”


There’s a new wealth gap online. The internet in rich countries will be unrecognizable in about five years.

You should be like James Comey at work. Documenting conversations with your boss is especially valuable when it’s your word against theirs.

Trump has a point about Germany. It’s not a great ally, but that doesn’t mean the US should give up on NATO.


Bad mayonnaise is a power source. When 1,250 gallons (4,700 liters) of it spoiled, researchers at Michigan State Universityconverted it to biogas.

Some cheetahs are terrible mothers. Many cubs are born, but only a few survive—having an older and wiser mom helps.

Monogamy is sexually satisfying. Only 11% of people in one-on-one partnerships are dissatisfied, versus 22% of those in open relationships.

Tilapia skin has painkilling properties. That’s one reason researchers in Brazil are using it to heal burns.

Fetuses can recognize human faces. They can also tell whether the faces are upside down.

Our best wishes for a productive day. Please send any news, comments, tilapia, and bad-boss paper trails to hi@qz.com. You can follow us on Twitter for updates throughout the day or download our apps for iPhone and Android.

Britain votes, Comey testifies, telescopic spiders

Good morning, Quartz readers!


Britain’s big pre-Brexit vote. A Conservative landslide in today’s snap general election would help prime minister Theresa May ensure the country’s EU exit happens on her terms. Other outcomes couldthrow the process wide open, and Labour has been steadily closing the gap in polls. An interest rate decision by the European Central Bank is also expected to test markets.

James Comey’s big day. Amid a media frenzy worthy of a major sporting event, the fired FBI director will testify in front of the Senate intelligence committee at 10am ET. According to his prepared testimony (pdf), Comey will detail how president Donald Trumppressured him for loyalty, not honesty, in the FBI’s investigation of collusion between Russia and the Trump campaign.

India and Pakistan shake hands. The not-so-friendly neighborswill officially join the Shanghai Cooperation Organisation, a Beijing-based group aimed at military cooperation and intelligence sharing, at a summit in Kazakhstan.


North Korea fired more missiles into the sea. Four projectilesflew about 200 km (124 miles) and were believed to be surface-to-ship cruise missiles. It’s possible but highly unlikely that such missiles could take down US aircraft carriers, which have defenses against them, military experts said. Last week two US carriersconducted nearby drills with Japanese warships.

China released surprisingly robust trade figures for May. In a sign global demand is picking up, exports increased 8.7% year-on-year in dollar terms, above the median forecast of 7% (paywall). Imports jumped 14.8% from a year ago, compared to expectations of 8.5%. The month’s trade surplus came in at $40.8 billion, short of the median estimate of $47.8 billion.

IKEA will test sales through third parties. Flat-pack furniture and home furnishings may soon be available on platforms like Amazon and Alibaba, as the Swedish giant experiments with new modes of digital shopping.

Japan revised its GDP down. The world’s third-largest economy expanded at an annualized rate of 1%, compared to a preliminary estimate of 2.2% (and economists’ forecasts of 2.4%), thanks in part to lower-than-expected business inventories and consumer spending. But with exports strong, it was still the fifth straight quarter of growth—the longest run of expansion since 2006.

A newly discovered fossil changed human history. Researchers at Jebel Irhoud, a site in Morocco, found evidence that Homo sapiens were around 100,000 years earlier than previously thought. The new evidence, which shows them dispersed throughout Africa, could rewrite the story of human evolution.


Corinne Purtill on a young developer who made a huge mistake. “The point is, any system in which humans are involved will at some point be disrupted by human error. Organizations distinguish themselves not by stamping out the possibility of error, but by handling the inevitable mistake well.” Read more here.


Stocks climb ever up
Alpinists know the descent
Is what’s dangerous


Retail trends are taking a dangerous turn. Fidget spinners and vape pens are bypassing retailers and regulators alike.

Yoga needs an ethical makeover. Recent lawsuits revealwidespread sexual misconduct (paywall) in the industry.

Qatar will be OK. Although its neighbors have cut trade ties, major Asian markets still rely heavily on its natural gas.


Russian hackers are using Britney Spears’s Instagram. One prominent group hid instructions for malware in the comments section.

Jumping spiders have eyes like telescopes. They can see the moon—and maybe even its craters.

An antique photo captured both Teddy Roosevelt and Abraham Lincoln. Teddy was just a little boy, watching Abe’s funeral procession in New York.

Fake science saved lives in Victorian England. The theory that bad smells cause illness was wrong—but it inspired a new era of sanitary living.

Beware: Ravens hold grudges. If you cross them, they willremember.

Our best wishes for a productive day. Please send any news, comments, revenge-seeking ravens, and ethical yoga instructors tohi@qz.com. You can follow us on Twitter for updates throughout the day or download our apps for iPhone and Android.