We're here to keep you safe in the financial markets and bring you your weekly update of the top global financial news. This week we cover the everything from SNAP's decline, Musk's Twitter purchase, how to cheat at chess, have we found the market bottom and much more. :
So in 20 minutes we get into:
- SNAP and advertising revenues
- What it means for this week's Tech Earnings updates
- $2 Trillion lost from crypto since Spring
- How to cheat at chess
- Is this the market bottom
- China's president (again!)
- Himars mobile rocket launchers
- Shetland Islands undersea cable
- The costs of cloud computing
- Dubai Property
- Elon loses $110 billion in one week
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Podcasts - https://rollingbananas.com
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Well, good morning everybody. It's Monday, and as usual, it's time for rolling bananas. As you know, last week Peter was sick as a robbers dog, but today is in fact back, back in top form. Peter, what's been happening while you've been. sick bed.
A lot's been happening when I've been on my sick bed. Um, I guess big thing at the moment, we're right in the middle of earnings season and this is the critical week.
This is tech week. So we have Google, uh, Alphabet, obviously as is, uh, Microsoft, Amazon, all the big ones. And thoughts are that there's a big downturn. Advertising Snap last week and every sort Snap was down to us. Yeah, yeah. Down 25% last week already down 75, 70 7% this year before that. Uh, claiming advertising issues.
So I think we're starting to see it trickling through to sort the broader economy now added as, uh, put at its second profit warning in three months, which is obvious. Consumer Adida or Adidas? I, I prefer Adida cuz I think that's the German pronunciation. Nice, Short, shy. Yeah. Could be Stubborn fier.
Fascinating story. This story of adida and humor. Do you know that, uh, Enlighten me please. Two brothers, both in the sports business, shoe business. Ironically, uh, one supported the Nazi party. One didn't. Oh, I see. Split off called his other one. P I see. So, um, I wear added as. Can't beat added us. Right. Anyway, there you go.
My brain's got a bit of brain fogg guess I still not figure which one was which there, but, uh, knowing you, I can assume it's yes. Um, so Twitter, obviously other, uh, company in the news. It's a tech company. Yes. It has advertising that was down. 9% pre-market on Friday. Elon Musk, uh, looks like he has to buy Twitter.
I think he's gonna have to settle down, um, some Tesla to do that. , he must be gutted and he's also sent a memoir out , but how many people he is gonna have to lay off, which is basically most of Twitter. Most of them, Yeah. Yeah. So I can imagine that morale there is not the, the highest and, uh, yeah, he's, he's ending up as we were just talking about, but he's ending up buying something for probably twice as much as he actually needed to.
Um, he could have started his own Twitter technology is not difficult. Yeah, it's not that complicated. And bringing, do it from day one. So you haven't got the bots out there. I mean, that's what I'd have done. Start Man Eon, if you're listening, if you listen to Trick Mate. Hmm. What else? What else? Oh, Crypto.
So, you know, every now and again we find a little story like spas we came up with a couple weeks ago. Crypto. Guess how much. has, and I love the word, when the financial times use word like evaporated has evaporated from crypto. This year. This year, oh my god. It would have to be a trillion dollars, I would've thought.
$2 trillion. 2 trillion. $2 trillion. That's nuts isn't it? Is absolutely nuts. I think that might be contributing to the global economic problems actually. Yeah, I really do. And I'm being genuine there. I really do. It's a lot of people have put obviously a lot of money in there and it's just literally 2 trillion brilliant, $2 trillion evaporated since the spring, not even this year.
Um, and what's been happening alongside that is a lot of the founder. It's called the evangelists. It all been cleared out. They will want people now to run the companies who actually know how to run companies rather than just say, This is the best thing. And you, prior to them going to prison Yes. Largely, Which is where a hell of a lot of 'em are gonna end up, I suspect.
Yeah, I think so. Particularly when you look at some of the us um, sort of Ritz and things that are out there. Yeah, yeah. Talking of, uh, Ritz Chess. Talk to you about chess. Interesting. Young up start. Who allegedly beat the, uh, World Champion Magnus. Um, he's suing for a hundred million dollars for a defamation Because he's been accused of cheating.
Yes. By the Grand Masters. I mean that in itself is interesting, but the way he was accused of cheating, I found to be quite disturbing. Allegedly. And this is a thing about technology as much as anything else, the chess computers that you have on your phone now are so advanced that they can beat. Grand Master.
Mm-hmm. . Allegedly he appeared with a sex toy, secreted somewhere about his person and was receiving Morse code messages on it as it vibrated to tell him what Move to make next king to porn. Two. Buzz Buzz Buzz Buzz. That is apparently how he, uh, was cheating . That is very weird. And um, it's weird and disturbing, but this kid has already admitted to cheating earlier on in his career to get up above people.
Yeah. It was quite scary though, isn't it? Yeah. You stumped me for a hundred million dollars. There's nothing you could say when I read that. I just thought, the only other thing, I'm gonna cover this now. The only other thing that disturbed me even more, did you see the former chairman of the, uh, Chinese Communist Party?
Yeah. The, I mean, handled out. That was, I was weird. Apparently he felt ill, he felt ill, Well, if he didn't, um, he's going to feel ill very, very ill. Fairly shortly I would. it, it's a very strange thing. You look at what G is doing now, uh, and he's doing exactly what Vladimir did over the last sort of 15 years.
And, um, so he's putting himself in a position of effectively infinite power now with just yes men around him. There you go again, Pete, you've gone against, I've gone made another, I'm completely couldn't say anything against you, Mr. G I think. Doing a fantastic job of the economy. Peter, on the other hand, has his concerns
Don't worry about that one. Once you get yourself into that sort of position, I'm sure to be in that sort of position is probably great, or maybe not. Maybe you get a bit paranoid. I can't imagine. I think you must be paranoid. I'm sure you'd be paranoid all the time. Um, like the Saudis, I'm just about to, um, now make some more of me.
These very rich Saudis who have houses everywhere and they move from house to house, they don't wanna be in one place for too long, cuz they're literally scared. They've got so much money. Yeah, yeah, yeah. They've got security details in every country, but, but you get yourself into that position and you're running a country then, you know, long story short, longer term, you're not gonna do the right thing by the country.
You're gonna do the right, the right thing by you and your mates. Yeah, and she's been an odd one for ages because he just keeps giving himself more and more titles and, But you know, I mean, I guess if he wins this time, if he wins, no, he's done. He's won. Well, he's the only person ever to be elected for three terms.
Well, I think there's only one him. I thought they always had at least three. The other two tend not to get many votes, but as their numbered ballot papers, , you know? Yes. But if you want to see an example of where, you know, a party behaving in its own self-interests can destroy economies and the country look no further than old Blighty.
Yeah, old Liz. She did make a bit of a cockup there. A bit of a mess there. A bit of a mess going on. Yeah. I, I like the way she's had two leaving parties though, checkers this, um, really huge country retreat reserved for the Prime Minister. She had two leaving parties after 44 days. You don't have two leaving parties.
Well, not unless they're taxpayer. Uh, no, apparently she has funded them herself. Okay. Yeah, she was, that was made very clear. But somehow, I suspect she might have said little bit like, Well, I'll pay for the nibbles from Marks and Spencer, but the rest of it's all covered, you know? Yeah. But, uh, you're not a place for a B byo, is it?
You're not gonna bring your own to check as well? No, and I noticed Biden yesterday, he said, um, he, he completely understands why people are worried about his health. Yeah. He could die at any. I think what he was trying to say was we could all die any moment. Yes, . But unfortunately it came out as I could die any moment probably doing misinterpreted.
Oh dear. Did So results are out. They don't seem spectacularly bad, but they don't seem spectacularly good either. I do notice now 30 odd percent retracement in the markets. Mm-hmm. , Lot of people talking about it being a good time to get back into it. But my uh, particular. Favorite Michael Barry. Of course Cassandra on, uh, Twitter says he still thinks he's got another 20% to go.
Uh, taking it down, you know, the classic 50% retracement. Yeah. The, uh, markets, as you say, the earnings have been okay, and what's been interesting is the banks have said that consumers are holding up pretty well. , but we are seeing, obviously mortgage rate rises. We're seeing the price of goods go up. We know that people are shopping down into sort of lower Walmart categories or moving into Walmart or doing similar.
So the pain is coming. Yeah, definitely. But it's not there yet. So, you know, we'll see this week in terms of, I'm sure that advertising will have dropped properly across the board. And you know, people say, you know, until you know, Wise is economist than us, until the increase in interest rates stops, you really aren't gonna see the market turning.
So, you know, it looks like there's another point, 75% nailed on for November. There's another meeting in December. Um, you know, we'll have to see. I mean, we are a point. , you know, this is where the banks could mess it up. Right? They could over reg it. Oh, like they might have done 18 months ago with the quantity of reasoning easing.
Now we're in this sort of quantity of timing phase. They could flip us back. Yeah. I think it's almost impossible to get it right though, isn't it? Yeah. I mean, they're talking about European Central Bank having to make yet another record increase to, uh, I think it's Wednesday. They make that, if they make that the UK putting maybe even a full percent on interest.
This is sort of thing that takes time to trickle through because people don't see it immediately, right? You don't immediately sit there and say, Oh my dear Lord. It's, it's gone up. My mortgage has gone up. It takes it a few months to really trickle through, but I think it could be an ugly Christmas. And I noticed that, uh, you go to your local shopping center already in the uk, it's a heck of a lot of places got their big sales underway.
Yeah. Because they're just not selling stuff in the run up to Christmas. Yeah. Yeah. So gotta be a global phenomenon though. I was, uh, also reading yesterday that the US stores really worried that this isn't going to be a. Is it black Thursday? I think they call it. Isn't that Friday? Black Friday? There isn't gonna be a black big Black Friday.
It's just gonna be Mm. Thanks very much. But I don't need another wide screen tv. Yeah, and I think that'll be the. The key sort of early indicator when, because Thanksgiving, that Thanksgiving shopping period tends to be bigger in the US than the, uh, Christmas period, which is bigger. Oh yeah. So, um, yeah, that Black Friday, so we shall see.
But trading's been good as we know. Um, yeah, definitely markets up and down. Uh, again, we had a crazy week the week before, and then even last week on Friday, we had a two and a half percent increase after tracking down for most of the week. I think, you know, people are undecided, the markets are undecided.
Um, are we gonna go lower? Yeah, probably. Will we get some rallies? Yes, of course we will in that, but what it means is we're getting some nice volatility as trades to be made up on the, uh, you know, the long side and on the short side when shares are dropping. So, yeah, I mean, the one place I wouldn't wanna be is a bond investor right now.
No, I think that's really, it caught a disturbing phenomena actually, that for the first. Bonds are being utterly hammered. Yeah. And of course, um, in the US and the UK, a lot of funds are forced to put a whole bunch of their money in bonds. Yep. So, you know, if you're coming up for retirement in six months, 12 months, it's probably not a great place to be.
If you've got three or four years, who knows, Maybe you'll fund or recover, but you don't wanna be retiring in the next few months if you haven't locked in some sort of annuity. and yeah, bonds are big focus, as you say, on bonds. And we, we were downgraded last week. We too negative by Moody's. Uh, the, the UK was, Yeah.
Um, Germany was downgraded from positive to neutral. France positive to neutral. So I think everywhere's being everywhere's, being downgraded because the whole shooting matches is in deep trouble. And still, the thing, as I said the last time we. , No one talks about Ukraine anymore. It's just completely, it's like, Oh, the economy's in trouble.
Forget about Ukraine. Um, what is happening there? I mean, well, well, there is stuff going on. There's been these attacks on, um, the, uh, power network. Um, and they're ordering these Hamish, not sure what they call, but they're basically mobile. rocket launches, which can take down cruise missile or Right. Those kind of things made by Boeing or one of the big uss uh, defense businesses.
And, uh, I didn't realize how long these things took to me. Do you know how many they're making this year? No. Like 15. So they can take down 15 Christmas missile halls. No, no. There's multiple missiles on these launchers. But the actual launcher thing itself, Oh, okay. They can make 15 a year. Now they're gonna try and double that.
I suppose you're always hoping that no one's actually gonna launch many out. The problem is it's that everyone else needs them as well. Germany wants some PO wants some. Wow. They, some of them are already given theirs to, um, Ukraine, so they're really desperate for them. They're really desperate for them.
But Ukraine need more. Um, God, if only they'd have made those instead of 7 3, 7 800 series, they could probably have Max. Max, Yeah. Rather than the Max Jets. They could probably save the saved lives instead of, uh, Yeah. Had the other disaster. But, uh, so yes, it's, it's, it's, it's still ongoing there. I mean, it's just becoming very entrenched.
You feel like there's probably, you know, a long entrench war there or there's some sort of political solution that no one will be happy with. And also last week, did you notice that the Shetland Islands was mysteriously cut off? Yes. From all internet, Everything in a sort of a spurious incident. And they've not, they didn't go into any details.
They've not said it was cut underwater or they just said that the embassy cable was severed. Yeah. And then five days later they fixed it. When I'm not an oceanographer. I do a bit of an engineering background and these cables are very deep. Some of them, Yeah, you'd have thought so. Yeah. If you would've thought fixing that is not that simple though.
It's new. Scarper flown it. Yeah, I guess so. So it's probably only a few hundred feet, but you still gotta get something down there to do it down. Yeah, I, I dunno whether that was either, who knows if that was, um, the Russians or, or not, but it's certainly a really odd thing to happen. I just. Coming after the, the gas pipeline was, Yeah.
Clearly blown up by somebody. Um, for some reason. Well, crafters and sheep farmers are a clear and present threat to the Russian regime, so I can imagine they'd be top of their hit list. Yeah. I, I didn't really, under, I didn't really understand is it's, . It is possible. It did just separate itself, I suppose.
Yeah, I guess so. Something could drag or Tru and net. Troll and net, Okay. Yeah. I dunno. Something like that, but just struck me as being a bit bit of a, Yeah, it was a bit weird. Bit of an odd one. So what have we got to look out for this week? Who are the big reporters and the tech companies? I know that IBM is saying they've, but they, IBM did very well.
They had a spectacularly good quarter. I'm expecting that to continue cuz they're big in consulting. Um, Oracle is one to watch, I think if you're fuller of, uh, products. Oracle, it's a fantastic company. Been around for a long, long time. Yeah. Long time. Um, still run the same guy, run by Larry Eon. Yeah. Yeah.
Um, who, uh, super smart guy, super good at marketing, really knows this stuff heavily into ocean racing. Mm-hmm. , um, ocean going yachts, et cetera. And I think he's like 74 years old now. Maybe a bit older than. , the company was thought to be really heavily on the wane, but he's just spun that around, produced this thing called the Oracle Cloud, and he's got such big cash reserves they can actually, um, He can actually support it.
Mm-hmm. and he, he's stated a couple of weeks ago, standby for some stellar announcement as, as to people that are going onto the Oracle cloud because one of the big trends in computing, surprise, surprise people are now terrified of the costs of cloud computing. Yeah. Because they get out of control very easily.
So cloud computing is where you take all the, the servers from your data centers and you put them into the cloud, which is owned by Microsoft or Google, or Amazon or Oracle. Um, that's what we used to call a mainframe years ago, where you rented bits of space on somebody else. Guess what? Do you know why these people build those?
Because you can make money outta it. Yeah. It is profit. Yeah. Turns out none of them are charities. Yeah. It's literally none of them. Yeah. It's almost as though it'd be cheaper to do it yourself. Yeah. And in fact, when you do the numbers, it probably is most looks like it is. Yeah. Cheaper to do it yourself.
So, um, ads and trends, they come and go, don't they? I've always said it to anybody that's worked in tech. You don't work in the tech industry. You work in the fashion industry. Yeah. And if skirts. Long, Everybody says they need to go up. If they're up, they need to come down and Yeah. Anywhere in between. Yeah.
As long as there's movement people are buying. But if, if everybody says, Yeah, this will do, we'll sit here for a while. Doesn't happen. No, doesn't happen. So we've got who've got to look forward to then. Yeah. So the therefore mentioned basically the alphabets that Google's, the Amazons, uh, the Microsoft. So when you look at sort of Google, Google is much more heavily influenced by advertising.
So advertising. Bad, then they'll be more impacted. Microsoft is more. Um, you know, b2b, more small, b2b, a lot of their money comes from. Um, so yeah, it'd be interesting to see. I mean, the other clouds on the horizon, if we needed any more clouds, which we don't are that the yen is down 45% in a year and they are not doing any quantitative tightening in their country.
And so they're getting hammered by the guilt markets and the bond traders as. Um, so yeah, cash is an interesting one. Um, there's basically been no net inflows of cash from consumers into UK funds in q3. Well, yeah, that doesn't, that doesn't surprise me. Everyone's holding it. That doesn't surprise me.
Everybody's got to be hanging onto cash now. Yeah, yeah. The thing is, it becomes a self-fulfilling prophecy right when the press is so negative and everything. Unless people are stupid, they don't immediately say, Well, I'll think longer term. Yeah. But ironically, now's a good time to putting your money in because by the time the press turns around and says the market is booming, you will have missed.
It will be too late. That 40%, 50% jump because there was always, um, in the market, it's always what they call the daily mail syndrome, which is if the Daily Mail to. Like a middle, middle ranking newspaper, I guess, of sorts. In the uk, if the Daily Mail told to invest in property, you knew it was time to get rid of your property.
If they told you it was time to get rid of your property, it was time to buy because they're absolutely diametrically, uh, uh, the wrong end of the spectrum when it comes to getting things right. Yeah. So if they're telling you, get rid of your stocks, get rid of your shares, they've had. It's probably a really good time to buy.
And I noticed, uh, in the Daily Mail that they're hammering the idea of investing, investing, investing. So they've got rid of bio, they've got rid of investing. And ironically, even after they've said said, Get rid of bio rents have gone up to historic highs. Yeah. So it's like everything we always say, if you wanna be an investor, the difference between an investor and a trader, if you wanna invest, you'll better take a long term view of things.
Yeah. You have five to. At least do you wanna be a trader? You need to look five to 10 minutes maximum. You don't wanna worry about it. So, and the other, uh, story that struck me the week was, you know, war is great for business. It's always been sort of said, war is great for business. There's a country, uh, that you visited a few times that was on its knees placed in the Middle East with a lot of sand where they couldn't sell anything.
It is now booming. Saudi Dubai. Oh, Dubai. Yeah. Yeah, yeah. Well, I saw, I don't dunno if you saw the house prices in Dubai top end house prices, this was the story I was reading. 70% including the, I believe I'm writing, saying the, uh, most expensive apartment ever, or actually Villa ever, $164 million. Sold to an Indian gentleman.
Yep. But where's most of it coming from? Most of the money? Yeah. Oh my Russia. Russia, Of course. Yeah. Why not? There's troves of, uh, people with a lot money left or leading Russia. Why would you used to buy all those properties around the. The palm. The palm and stuff that weren't going now going for stupid amounts of money.
Yeah, yeah, yeah, yeah, yeah. If you, if you got to Dubai and you had some spare cash and you, you could have lucked out there big time, but Yeah. Yeah, yeah. I dunno about Dubai is a strange place. It's a really strange place because its property market is up and down like you, It's also phenomenally expensive to live there.
I can imagine. I mean, it's like crazy expensive. If you wanna, There's a lot of people try and go there and be digital nomads. It's almost impossible to do it because the cost of living is so great. Right? And when you rent somewhere, you don't rent by the month. They give you a monthly number, but it's for 12 months and you have to pay all 12 months up front in one big lump sum.
Okay? So people end up being lent a lot of money by their companies to work there. Then if they lose their job, they get 14 days to find another job or leave the country. All right? Okay. And if you get told to leave the country, guess what? You don't get back from your property. Yeah, you don't get that money back.
You don't get anything. No. So, um, you just lose your money. There you go. And so, there you go. Interesting episode this week. You're coming from, um, Chess to to buy the chess fund. Still worries guard me. Yeah, exactly. So it's one of those things you'll never forget, um, via Elon Musk who had a somewhat shrinking fortune last week.
Yes. Yeah. I didn't mention that. Did 110, uh, billion dollars was wiped up his fortune $110 billion. And he's still the world's, still the world's wealthiest man. World's wealthiest man. And also what other, you see the world's wealthiest of, um, Oh, I don't know. He's also the world's wealthiest actor. And now here's an interesting fact.
He's appeared in seven feature mo future feature length movies. Even though they're bit parts, if you have more appearing more than five, you're classed as an actor. Okay. So he is also the world's wealthiest actor. Oh, I see. And on that little factoid of Elon is, That's it from me. It's from me as well.
Cheer. Bye bye. Thank you.