If you haven’t already checked out this great expert interview transcripts database (20,000+ and counting) you can grab a free 2 week free trial here (just use a business email and name required, hit activation link).
“By Allison’s account, in 12 of 16 historical examples, competing empires ended up in military conflict, and Allison sees the US-China relationship as a rerun of these precedent“
The counter point is this great chart from JPM showing how intertwined economically the two powers are vs. historic struggles.
However, the direction of travel isn’t supportive.
A prime example is 2022 CHIPS Act, the most bipartisan piece of legislation in a long time.
NB this was a good transcript covering the impact on semi equipment companies (use this link to sign up for free).
“This risk is particularly noteworthy given that many companies with loans outstanding are carrying significant debt loads.The average debt-to-EBITDA ratio in new U.S. loan transactions hit a record-high 5.5x in 1Q2022, above the 4.9x recorded just before the Global Financial Crisis.“
“Importantly, companies involved in these transactions were often more highly levered than they appeared on paper, as many used aggressive EBITDA adjustments (e.g., for synergies, cost cuts, etc.) when making these leverage calculations.”
Cloud Vendor market was $159bn annual run-rate market in Q2, still growing 37% (though slowing).
This growth has actually come with pretty good economics. (From this Battery VC deck).
One very interesting feature of these vendors is they also happen to run huge cloud based products (think Xbox for example) which means they are customers of their own infrastructure – utilising it and making it better.
“GS PB long/short ratio stays at longer term relatively depressed levels. This is not to be used as an input for short term trading strategies, but worth having in the back of your head.“
One of the clear harbingers of the sharp rally last week was not just very negative sentiment, or the CPI print itself, it was the overly calm VIX index.
The VIX spent most of October falling, despite the bearish drum beat.
“Here’s the US junk bond CDS credit spread index, which remains well below its 2008, 2011 and 2020 peaks, and the shape of the CDS curve, which tends to invert [Pictured] as markets freak out about a rash of near-term defaults.“
Interesting chart from Mauboussin showing the distribution of ROIC of the Russell 3000 index.
“The mode is an ROIC of 5 to 10 percent, and the distribution is shaped like a bell between the tails. But nearly 30 percent of the sample are at the extremes of an ROIC of -20 percent or less or 30 percent or more.“
File this under – things that could radically change the US healthcare market that few are talking about.
Federal rules, that took effect 6th of October 2022, mean for the first time patients get unrestricted access to their health data and can choose who else does.
“To think that we actually have greater transparency about our personal finances than about our own health is quite an indictment,” said Isaac Kohane, a professor of biomedical informatics at Harvard Medical School. “This will go some distance toward reversing that.”
FedNow, a faster payments network designed by the Federal Reserve, is nearing launch in 2023 and this is a great explainer/history post.
The US lags far behind the rest of the world in faster payments.
FedNow could change that (or not) – it for one is cheaper than existing competitors.
There is also this chart, showing adoption rates of faster payment systems around the world – those that launched recently had faster adoption (especially if helped along by regulators).
