Christmas shopping just delayed iTariffs

Wednesday, August 14, 2019 by Robinhood Snacks | Disclosures

Markets weren't expecting this, but kind of love it

Dow Jones
26,275 (+1.42%)
S&P 500
2,925 (+1.44%)
Nasdaq
8,016 (+1.95%)
Bitcoin
$10,902 (-4.82%)
10-Yr US Treasury
1.689%

Hey Snackers,

Simone Biles just pulled off the 1st ever triple-double (twists on twists on twists).

Give US trade policy a gold for its own flips — fresh after planning tariffs to hit China within a few weeks, the US is now backing down hostilities. That performance was enough to jack the Dow up 373 points Tuesday.

Appear
1. Snap tries (again) with hardware: Spectacles 3

Forward to your 1 friend who will actually get these... For a cool $380, they too can strut around in a pair of Snap's Spectacles 3. A limited number go on sale here in November, featuring a new HD camera to create depth perception as you semi-creepily record everyone around you. We consider the design pseudo-Coachella-geek-hipster chic.

If at first you don't succeed... spend a lot of company resources to try 2 more times. Here's the social network's timeline/quest to add hardware to its app success:

  • Spectacles 1 (2017): A $130-per-pair costly mistake — Snap sold them via pop-up vending machine, but made way more glasses than the 150K that were actually sold, costing it $40M.
  • Spectacles 2 (2018): A $150 thinner mistake — Snap made the glasses narrower and waterproof, but they didn't catch on, either.
  • Spectacles 3 (Now): A $380 potential mistake obsessed with augmented reality — It definitely prices out most of Snap's teen userbase, but 3D filters make your walk to work look actually interesting.
THE TAKEAWAY

Friction is the problem... There's nothing wrong with a tech company testing out a wearable device like Spectacles — but Snapchat still hasn't fixed problems that make them hard to use. Example: Footage taken on Spectacles doesn't automatically transfer to your Snapchat account. (Friction). That's why over half of Spectacles 1 & 2 users quit after a month.

Un-tariff

iTariffs... President Trump announced them just 2 weeks ago. With everything else already tariff'd, the US planned to tax the remaining $300B worth of consumer products made in China starting September 1st — including the iPhone. Yesterday, he said nevermind: waiting until December 15th for most new tariffs so American shoppers can have a Merry Christmas.

Teachers hate procrastination... Markets don't. The tariffs were essentially a 10% tax that would hurt profits for companies manufacturing in China, while raising prices by 10% for everybody. Here's who wins with Tuesday's sudden flip:

  • Apple: Shares popped 4% because iPhones and MacBooks won't get 10% more expensive until after most holiday shopping is done. Made in China AirPods, the Watch, and HomePod still get hit on September 1st, though.
  • Mattel & Best Buy: The stocks rose 5% and 6% as Made in China action figures and speakers will remain tariff-free through the holidays.
  • Nike: Sneakers were also on the exemption list, so the swoosh jumped up 2%.
THE TAKEAWAY

This sends a message to China... If the trade war has political or stock market costs, America might cave. Credibility is important in negotiations, and Trump's credibility takes a hit with this one.

  1. Political cost: Since American buyers pay US tariffs, not Chinese exporters, this latest round would have grinched Christmas for American households.
  2. Stock market cost: If tariffs caused poor holiday sales, stock markets likely would've suffered.
Mergin'

Distance makes the heart grow fonder... Or something like that. Take CBS and MTV/Nickelodeon-owner Viacom. The two media legends split 13 years ago — and then, like Ross and Rachel, they spent the past 3 years (slowly) flirting over whether to get back together. Now the deal has officially been reached, and these are the primetime numbers:

  • $28B: The combined revenue of the Brangelina-esque new "ViacomCBS."
  • 140K & 3.6K: The combined number of TV episodes and movies the new company will own.
  • 4.3B: The incredibly massive global reach of TV subscribers ViacomCBS claims to have.
  • 61% vs. 39%: When the deal likely closes at the end of the year, CBS shareholders get 61% of the new company, Viacom shareholders get 39%.

Family Matters... The Redstone family ran Viacom until 2006, when it made sense to split off CBS as a separate company. But now that YouTube, Netflix, and social networks are eating into both companies' profits, a re-merger seems prudent. Media heiress Shari Redstone wanted to reunite, but former CBS CEO Les Moonves was against it — now that he's been pushed out for alleged sexual assault, Shari gets her family reunion.

THE TAKEAWAY

This all comes down to one word: streaming... CBS All Access was actually one of the 1st streaming networks, but never really took off. Consolidating Viacom and CBS' original content from Spongebob to Star Trek is respectable enough to entice cord-cutters — but Netflix and Amazon are already way bigger, and Disney just acquired Fox. Content remains king, and ViacomCBS is a smaller kingdom.

What else we’re Snackin’
  • Fresh: Domino's decides to embrace e-bike pizza delivery all by itself (no 3rd-party delivery apps) — and it's hiring
  • Chilled: Coca-Cola is releasing aluminum Dasani water bottles over the next year (but it's still making the plastic ones too)
  • Unveiled: Allbirds pioneered direct-to-consumer sneakers — now its first non-shoe product is...socks (with an entirely new material: "Trino")
  • Overheard: Spotify is kicking its podcasting fix up a notch: it officially released "Spotify for Podcasters" to give creators valuable audio data
  • Hungry: Tilray, the Canadian pot company, dropped after its earnings, but acquiring a hemp food company helped pump sales up 371%
Snacks Daily Podcast

Your Snacks Daily team is off the pod mics for a few more days — back in your ears next week

Wednesday

Disclosure: Authors of this Snacks own shares of Luckin Coffee and Amazon

20190813-926730-2794277

Subscribe to Robinhood Snacks

Our Editorial Principles
Robinhood Financial LLC and Robinhood Crypto, LLC are wholly-owned subsidiaries of Robinhood Markets, Inc. Equities and options are offered to self-directed customers by Robinhood Financial. Robinhood Financial is a member of the Financial Industry Regulatory Authority (FINRA) and the Securities Investor Protection Corporation (SIPC), which protects securities customers of its members up to $500,000 (including $250,000 for claims for cash). Explanatory brochure available upon request or at www.sipc.org. Cryptocurrency trading is offered through an account with Robinhood Crypto. Robinhood Crypto is not a member of FINRA or SIPC. Cryptocurrencies are not stocks and your cryptocurrency investments are not protected by either FDIC or SIPC insurance.

Getting “early access” to options or Web is defined as signing up with a valid email address for a spot in Robinhood Financial’s respective waitlist queues for Web or for options. Getting “early access” to Robinhood Crypto is defined as signing up with a valid email address for a spot in Robinhood Crypto’s waitlist queue. Early access to the waitlist for Web, options, or Robinhood Crypto should in no way be construed as confirmation that a brokerage account with Robinhood Financial has been opened or will even be approved for opening. Priority may be given to Robinhood Gold subscribers and existing customers of Robinhood Financial.

Free trading of stocks and options refers to $0 commissions for Robinhood Financial self-directed individual cash or margin brokerage accounts that trade U.S. listed securities via mobile devices or Web. Relevant SEC & FINRA fees may apply. Please see the Fee Schedule.

Robinhood Financial is currently registered in the following jurisdictions. This is not an offer, solicitation of an offer, or advice to buy or sell securities, or open a brokerage account in any jurisdiction where Robinhood Financial is not registered. Additional information about your broker can be found by clicking here.

Margin trading involves interest charges and risks, including the potential to lose more than deposited or the need to deposit additional collateral in a falling market. Before using margin, customers must determine whether this type of trading strategy is right for them given their specific investment objectives, experience, risk tolerance, and financial situation. For more information please see Robinhood Financial’s Margin Disclosure Statement, Margin Agreement and FINRA Investor Information. These disclosures contain information on Robinhood Financial’s lending policies, interest charges, and the risks associated with margin accounts.

Investors should consider the investment objectives and unique risk profile of Exchange Traded Funds (ETFs) carefully before investing. ETFs are subject to risks similar to those of other diversified portfolios. Leveraged and Inverse ETFs may not be suitable for all investors and may increase exposure to volatility through the use of leverage, short sales of securities, derivatives and other complex investment strategies.

Although ETFs are designed to provide investment results that generally correspond to the performance of their respective underlying indices, they may not be able to exactly replicate the performance of the indices because of expenses and other factors. A prospectus contains this and other information about the ETF and should be read carefully before investing. Customers should obtain prospectuses from issuers and/or their third party agents who distribute and make prospectuses available for review. ETFs are required to distribute portfolio gains to shareholders at year end. These gains may be generated by portfolio rebalancing or the need to meet diversification requirements. ETF trading will also generate tax consequences. Additional regulatory guidance on Exchange Traded Products can be found by clicking here.

Options transactions may involve a high degree of risk. Please review the options disclosure document entitled the Characteristics and Risks of Standardized Options available through https://about.robinhood.com/legal or https://www.theocc.com to learn more about the risks associated with options trading.

The cash management program is expected to be offered by Robinhood Financial LLC. The cash management program, when operational, will be an added program to Robinhood brokerage accounts and will not be a separate account or a bank account. Robinhood Financial will provide additional information on the cash management program once it is operational to help customers, including those with “early access,” to determine if they want to add the program to their brokerage account.

Robinhood Snacks newsletters and podcasts reflect the opinions of only the authors who are associated persons of Robinhood Financial LLC and do not reflect the views of Robinhood Markets, Inc. or any of its subsidiaries or affiliates. They are meant for informational purposes only, are not intended to serve as a recommendation to buy or sell any security in a self-directed Robinhood account or any other account, and are not an offer or sale of a security. They are also not research reports and are not intended to serve as the basis for any investment decision. Any third-party information provided therein does not reflect the views of Robinhood Markets, Inc., Robinhood Financial LLC, or any of their subsidiaries or affiliates. All investments involve risk and the past performance of a security or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk, it does not assure a profit or protect against loss. There is always the potential of losing money when you invest in securities or other financial products. Investors should consider their investment objectives and risks carefully before investing. The price of a given security may increase or decrease based on market conditions and customers may lose money, including their original investment. Robinhood Financial LLC, member FINRA/SIPC.

Testimonials may not be representative of the experience of other customers and are not guarantees of future performance or success. Robinhood Financial LLC, member FINRA/SIPC.

Third party information provided for product features, communications, and communications emanating from social media communities, market prices, data and other information available through Robinhood Markets, Inc., Robinhood Financial LLC or Robinhood Crypto, LLC are meant for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of any financial instrument or cryptocurrency or as an official confirmation of any transaction. The information provided is not warranted as to completeness or accuracy and is subject to change without notice. Any information about Robinhood Crypto on any Robinhood website (including www.robinhood.com and blog.robinhood.com), the Robinhood platform, e-mails, or any other communications, are meant for informational purposes only and are not intended as an offer, solicitation, or advertisement for Robinhood Crypto or any goods or services offered by Robinhood Crypto. The Robinhood website provides its users links to social media sites and email. The linked social media and email messages are pre-populated. However, these messages can be deleted or edited by users, who are under no obligation to send any pre-populated messages. Any comments or statements made herein do not reflect the views of Robinhood Markets Inc., Robinhood Financial LLC, Robinhood Crypto, LLC, or any of their subsidiaries or affiliates.

Investors should be aware that system response, execution price, speed, liquidity, market data, and account access times are affected by many factors, including market volatility, size and type of order, market conditions, system performance, and other factors.

All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. Keep in mind that while diversification may help spread risk it does not assure a profit, or protect against loss, in a down market. There is always the potential of losing money when you invest in securities, or other financial products. Investors should consider their investment objectives and risks carefully before investing.

Cryptocurrency is a digital representation of value that functions as a medium of exchange, a unit of account, or a store of value, but it does not have legal tender status. Cryptocurrencies are sometimes exchanged for U.S. dollars or other currencies around the world, but they are not currently backed nor supported by any government or central bank. Their value is completely derived by market forces of supply and demand, and they are more volatile than traditional currencies. Trading in cryptocurrencies comes with significant risks, including volatile market price swings or flash crashes, market manipulation, and cybersecurity risks. In addition, cryptocurrency markets and exchanges are not regulated with the same controls or customer protections available in equity, option, futures, or foreign exchange investing. Cryptocurrency trading requires knowledge of cryptocurrency markets. In attempting to profit through cryptocurrency trading, you must compete with traders worldwide. You should have appropriate knowledge and experience before engaging in substantial cryptocurrency trading. Cryptocurrency trading may not generally be appropriate, particularly with funds drawn from retirement savings, student loans, mortgages, emergency funds, or funds set aside for other purposes. Cryptocurrency trading can lead to large and immediate financial losses. Under certain market conditions, you may find it difficult or impossible to liquidate a position quickly at a reasonable price. This can occur, for example, when the market for a particular cryptocurrency suddenly drops, or if trading is halted due to recent news events, unusual trading activity, or changes in the underlying cryptocurrency system. Several federal agencies have also published advisory documents surrounding the risks of virtual currency. For more information see, the CFPB’s Consumer Advisory, the CFTC’s Customer Advisory, the SEC’s Investor Alert, and FINRA’s Investor Alert.

Robinhood Crypto, LLC has a seller of payment instruments license in Georgia, with reference number 61417.

Robinhood Crypto, LLC has a money transmitter license in New Jersey, with reference number 1803456-C22.

Please note that an Alaska money transmission license does not cover the transmission of virtual currency.

Check the background of Robinhood Financial LLC and Robinhood Securities, LLC on FINRA’s BrokerCheck.

Robinhood Terms & Conditions    Disclosure Library    Contact Us    FAQ

© 2019 Robinhood. All rights reserved.