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Tesla CEO and “Technoking” Elon Musk
Britta Pedersen-Pool / Getty Images
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It’s getting weird in EV-land and this time it’s not just
Tesla.
Should investors be concerned?
Electric vehicle investors are used to a bit of weirdness. After all, there are tweets from Elon Musk with a dog in high fashion. And the Tesla Cybertruck, due for delivery later this year, looks like something out of a Mad Max / Blade Runner crossover movie.
Still, Tesla took the weirdness to another level on Monday when, in a regulatory filing, the company announced that Musk’s title now included “technoking” and that CFO Zach Kirkhorh would also be known as the title “Master of Coin.” .
And then there’s the EV truck maker
Nikola,
whose stock has fallen 66% since September. On Monday afternoon, he submitted a prospectus to the SEC stating that the company planned to sell shares. Companies often don’t issue cash at low stock prices if they don’t need the money now. Nikola now has more than $ 800 million in cash on his balance sheet. Its shares fell more than 2% on Tuesday morning.
And remember, last week the launch of electric vehicles
Canoo
Took a page from Tesla’s book by launching a van that looks a bit like a space capsule. And the proposed vehicle has more hidden and removable compartments than a puzzle box.
Investors expect such oddities from Elon Musk and Tesla. It remains to be seen whether they will do so from other electric vehicle manufacturers.
–Al Root
*** Are investors looking at stock valuations or internet memes? Join Beverly Goodman, Editorial Director, Investments and Asset Management, and Daniel Wiener, President, Adviser Investments, for a discussion on what’s driving the market today at noon. Sign up here.
***
AstraZeneca Jab European shelf delays problematic vaccination campaigns
Oxford Suspension /
AstraZeneca
The vaccine becomes widespread in Europe after Germany and France emulated smaller countries for fear of unwanted effects. Most drug regulators have advised against the temporary ban, which will delay the already slow vaccination campaigns on the continent.
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Germany, France, Italy and Spain, along with Sweden on Tuesday, have followed the smaller countries that had discontinued the Oxford vaccine. after several patients suffered blood clots.
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AstraZeneca has noted that the number of people with blood clots is not higher than in the general population. Both the World Health Organization and the European Medicines Agency earlier this week advised governments to continue using the jab.
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The EMA is due to issue a notice Thursday after a further review of the cases in Europe.
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Suspension decisions come when the majority of European governments are trying to speed up their vaccination campaign, hampered by logistical miscalculations, bureaucratic paralysis and supply problems.
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In the nearly 3 months since vaccines became available, 38% of the British population and 33% of the US. have received at least one injection of one of the available vaccines. That compares with around 11% in Germany, France or Italy.
Whats Next: Most European governments have acted as a precautionary measure designed to allay fears among populations skeptical of vaccines. If the EMA once again gives the green light to the AstraZeneca jab on Thursday, they will have the coverage they need to resume use. French President Emmanuel Macron has already said that this could happen quickly after the EMA report.
–Pierre Briancon
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Biden looks for ways to finance infrastructure and boost economic growth
Growing concerns about America’s growing deficit mean that President Joe Biden will need to consider other financing options for future economic proposals, including his infrastructure spending package, such as raising taxes.
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The Congressional Budget Office projects that the United States’ deficit will reach $ 2.3 trillion this year. Republicans and moderate Democrats like Sen. Joe Manchin (D., W.Va.) have said that will not support large expense bills unless they are paid for, either with taxes or other spending cuts.
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Biden is planning a tax increase That could increase both the corporate tax rate and the individual tax rate for people who earn more than $ 400,000 a year, Bloomberg News reported. Treasury Secretary Janet Yellen said Sunday that the administration “will present proposals to control deficits.”
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Earlier this month, Senator Elizabeth Warren (D., Mass.) proposed an “ultra millionaire tax” That could generate $ 3 trillion in revenue over a decade. On Monday, a Treasury Department watchdog reported that the ultra-rich collectively owe about $ 2.4 billion in back taxes.
Whats Next: Any proposed tax increase is sure to meet resistance. “As we come out of the pandemic and try to rebuild this economy, there is no worse time to raise taxes,” Rep. Kevin Brady (R., Texas) told The Wall Street Journal.
–Janet H. Cho
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Streaming services dominate Oscar nominations in pandemic year
This year’s Academy Award nominations are all the rage. With theaters mostly out of the picture for the past year, streaming services dominated.
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Netflix
it garnered 35 Oscar nominations, including two for best picture. “Mank” received 10 nominations, while Netflix’s other best picture contender, “The Chicago Trial of the 7,” earned six.
Amazon.com‘s
Amazon Studios accumulated 12 nominations, led by “Sound of Metal” with six.
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“Judas and the Black Messiah”, which premiered on
AT&T‘s
HBO Max and in theaters last month, also tied for second with six nominations. The movie marks the first time a totally black production team received a nod for best picture at the Academy Awards.
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Walt disney,
which also chose to release movies on their streaming services previously, he received three nominations for the Pixar film “Soul” and two for “Mulan.” The company’s Searchlight Pictures “Nomadland” also received six nominations, including best picture.
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The same day of the nominations,
AMC Entertainment Holdings,
the largest theater operator, reopened in its critical Los Angeles market after almost a year of closings due to the pandemic. AMC shares rose 26%.
Whats Next: This year’s awards temporarily lifted a rule that required contestants to hit theaters. But streaming services will likely be at the center of the issue next year, especially given WarnerMedia’s plans to launch its entire roster on HBO Max when they hit theaters.
–Connor smith
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What to watch while the Federal Reserve rate panel meets
The Federal Open Market Committee will face significantly changing circumstances as it meets this week for the first time since late January, as the returns on inflation-protected securities of both the 10-year Treasury and the 10-year Treasury are far too high. highest since then.
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It is certain that the FOMC do not make changes to current policyInstead, it keeps its overnight federal funds rate target close to zero and its current monthly security purchases of $ 120 billion.
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The market’s attention will be on the panel’s Summary of Economic Projections, which will be updated for the first time since December 16. Without a doubt, the Fed’s gross domestic product growth projection for 2021. will rise significantly from 4.2% previously.
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All eyes will be on the group’s federal funds rate projections. The December forecast summary showed that the FOMC’s median expectation was for federal funding to stay close to zero. until the end of 2023.
Whats Next: Christian Scherrmann, an American economist at the DWS Group, writes that the Eurodollar futures market has been priced at no fewer than five federal funds rate hikes of a quarter point in 2024. While that is still a long way off, the market for securities will be sensitive to any signs of higher interest rates in the future
–Randall W. Forsyth
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Buffett’s Berkshire has bought back $ 5 billion worth of stock in 2021, so far
Berkshire Hathaway
continued its strong share buyback pace in the first two months of 2021, repurchasing around $ 5 billion of shares based on a Barron calculation.
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The company repurchased $ 24.7 billion of its shares, or 5% of outstanding shares, during 2020. Buybacks follow approximately $ 9 billion of buybacks in both the third and fourth quarters of 2020, when CEO Warren Buffett increased purchases.
- Repurchase activity slowed from February 16 to March 3 from the rhythm of the first six weeks of the year. That may be because Berkshire shares were rising and Buffett is price sensitive. Or the company may have slowed buybacks ahead of its fourth-quarter earnings and its February 27 annual report.
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Buffett was paid a salary of only $ 100,000 in 2020 with no bonus, as has been the case for over 25 years, and that’s before reimbursing the company $ 50,000 for shipping and other incidentals. The company also paid $ 280,000 for its security services in 2020.
Whats Next: Berkshire is no longer as low a value as it was in 2020. The stock is now trading at about 1.35 times its late 2020 book value of $ 287,000 per class A share, in line with the five-year average. Berkshire traded around 1.2 times its book value for much of last year.
–Andrew Bary
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Do you think you are an expert in stock selection? It’s not too late to join this month’s Barron’s Daily Virtual Stock Exchange Challenge and show us your stuff.
Each month, we will start a new challenge and invite newsletter readers (you!) To create a virtual money wallet and compete against the Barron’s and MarketWatch community.
Everyone will start with the same amount and will be able to trade as often or as much as they want. We will track the leaders and at the end of the challenge, the winner with the highest value portfolio will be announced in The Barron’s Daily newsletter.
Are you ready to compete? Join the challenge and choose your actions here.
***
—Newsletter edited by Anita Hamilton, Stacy Ozol, Mary Romano, Matt Bemer, Ben Levisohn
