The Long Term Investor

Speaking of META earlier.....I thought this little article was interesting.

My Sad, Lonely, Expensive Adventures in Zuckerberg’s V.R.

https://www.nytimes.com/2022/11/04/opinion/facebook-meta-zuckerberg-virtual-reality.html

(BOLD is my opinion OR what I consider important content)

"Meta, the company formerly known as Facebook, has been investing heavily in what it calls “Metaverse,” a virtual reality wonderland that Mark Zuckerberg believes represents the future of human connection.

But to me, the most interesting questions about the metaverse are less sociological than financial. When I put on the company’s newest virtual reality headset, the $1,500 Meta Quest Pro, and parachuted into Meta’s virtual theme park, Horizon Worlds, it wasn’t the future of human communication that I wondered. Rather, it is the state of the Meta accounting department.

Zuckerberg’s Arcadia is a cartoon wasteland. Billboards are fun everywhere; there are concerts, game rooms, open mics, dance halls, bowling alleys, escape rooms, and more. But almost all of it is a tease. Most of these places are dead; you’ll be lucky to find that many have more than one avatar. Every corner of Meta’s virtual world exudes an eerie air of abandonment, like a post-apocalyptic America in a Fallout game. As you wander the abandoned place, you can’t help but imagine that all these billions are on fire: Zuckerberg spent all his money. . . about this? how? Why? What was he thinking about? Has he been blackmailed?

The amount is staggering. In its earnings report last month, the company said its Metaverse business, Reality Labs, had burned through nearly $4 billion in the most recent fiscal quarter. The division has spent more than $10 billion so far this year, and is on track to surpass the $12 billion it spent on the Metaverse last year. In just a few short years, Meta’s VR investment has surpassed what the US spends on the Manhattan Project (adjusted for inflation).

Of course, many tech companies poured a lot of money into new initiatives. Netflix has invested tens of billions of dollars in movies and TV shows. Tesla is investing heavily in building out its car and battery manufacturing operations. Every year, Amazon spends billions of dollars on data centers and fulfillment warehouses.

But what sets Meta’s payout apart is how little it needs to show. At least Netflix’s billions brought us Stranger Things and The Squid Game. Tesla funding is revolutionizing the auto industry. Amazon’s endless investments allow me to get same-day shipping on toothpaste and toilet paper. On the other hand, Meta’s VR spending doesn’t seem to be more productive than shoveling cash into the melting pot. Reality Labs’ $12 billion cost resulted in just $2.3 billion in revenue last year; so far this year, revenue is only slightly higher, while costs have increased by more than a quarter.

If Meta were to use the money to subsidize the cost of its VR headsets, Meta’s hefty spending might justify — lowering its price enough to make these devices mainstream. But as I said, the company’s newest VR rig costs a whopping $1,500.

Meta Quest Pro is pretty good. It’s more comfortable to wear than older and cheaper versions, and its display and motion tracking systems work more smoothly, eliminating the mild motion sickness and eyestrain I experienced on previous VR devices.

Still, it’s well out of the price range for most consumers. Meta says the device is aimed at professionals looking to make VR an essential part of their remote offices, but even that seems far-fetched. It’s still a big, bulky thing to put on your head. It’s hard for me to stay in any VR session for more than an hour or so before my head starts to hurt. I doubt many office workers will use this headset as their primary work device.

And Meta’s cheap headphones don’t come cheap. At $399, the Meta Quest 2 is as expensive as many high-end video game consoles, and far less practical. Where an Xbox Series S or PlayStation 5 is teeming with games and a large user community, much of Meta’s Quest ecosystem feels like a work in progress. Meta’s VR store has a lot of apps and games, some of which are fun; however, most look like beta offerings that require you to spend $10 or $20 on games that only offer an hour of fun.

Then there’s Horizon Worlds, the social corner of the Meta virtual world. Horizon Worlds aims to be the VR version of the Facebook app: it’s a place to hang out, chat with friends and strangers, play games, and explore the digital future of relationships. This seems to be Zuckerberg’s favorite part of VR; he often posts his adventures through Horizon Worlds, which he often describes as the future of digital sociality. But on a conference call with investors last month, he did admit that Horizon World “clearly has a long way to go before it becomes what we aspire to be.”

I would say. The Wall Street Journal reported last month, citing internal company documents, that Meta was forced to lower its growth forecast for Horizon Worlds. The company once aimed to reach 500,000 monthly active users by the end of the year, but it’s less than 200,000 so far.

“An empty world is a sad world,” noted a company document cited by The Wall Street Journal. This is true for me. My time in Horizon Worlds was often more frustrating than fun. It’s the main social app on the most important new device ever made by the internet’s most successful social networking company – it’s a car-filled, empty, low-fidelity mess where avatars don’t even have legs (yet), where Most of the “worlds I’ve visited” were empty, the most populous places I found were only a few dozen people, and the conversation was often a little deeper than “Hey” and “How are you?”

I don’t rule out socializing in VR. It’s possible that one day, someone will crack the code to having a good time in a virtual world. But Meta’s massive payout didn’t get us there. This is a company with too much capital and too little original or innovative ideas. Billions of dollars were burned at a party that no one wanted to attend."

MY COMMENT

I dont know what this company is doing or thinking. This project is an ABJECT FAILURE. Someone should pull the plug.....but they cant. With the shareholder structure at META......there is one person that controls the entire business....Zuckerberg. This is a total failure of vision......or more likely......a vision that is distorted.

This is what happens when a SOCIALLY DYSFUNCTIONAL CODER.......with extremely poor....to nonexistent..... social and people skills....tries to build a social gathering place.

This is also what happens when people put their money into a business.....a public corporation.....where the founder has near total dictatorial control of the votes. The primary reason that I dont like this company from a business standpoint....regardless of the management or what they do....is the shareholder structure that relegates the shareholders to.......NOTHING.

 

I assume that the share structure at META is still the same.....I dont see that it has ever changed. This is an old article but I think it is still the truth.

Mark Zuckerberg is essentially untouchable at Facebook
Zuckerberg has an enormous amount of voting power at Facebook, meaning he’s not going anywhere.

https://www.vox.com/technology/2018/11/19/18099011/mark-zuckerberg-facebook-stock-nyt-wsj

(BOLD is my opinion OR what I consider important content)

(FROM DECEMBER 2018)

"Mark Zuckerberg isn’t going anywhere at Facebook — at least not if he doesn’t want to.

It’s been a rough year for the Menlo Park, California-based social media giant, which has been dogged by scandal, and things just keep getting worse. The latest: a blockbuster story from the New York Times published on Tuesday detailing how Facebook gave companies such as Netflix and Spotify access to users’ private messages and shared a wide range of personal data with some 150 companies between 2010 and 2018.

The string of controversies has placed fresh scrutiny on the 34-year-old tech executive and others in power at Facebook, including chief operating officer Sheryl Sandberg.

The Times in November reported on Facebook’s behind-the-scenes efforts to downplay and deny the Cambridge Analytica data breach and Russian disinformation. And the Wall Street Journal reported that Zuckerberg earlier this year told top executives at Facebook that the company was at war, and his approach has caused turmoil within the company. Morale has declined, and multiple key figures within Facebook have departed.

On a call with reporters in November, Zuckerberg was asked whether anyone at Facebook would lose their jobs over what the November Times account says happened — or whether he’ll give up some of the control he holds. Zuckerberg is the founder, CEO, and chair of Facebook. Would he be willing to give up, say, his position as board chair?

Zuckerberg’s answer, as it has been for years, was no. “For the board composition, I don’t think that that specific proposal is the right way to go,” he said.

He reiterated the point in an interview with CNN Business, saying that stepping down as chair is “not the plan.”


And the thing is, no one can make him.

There have long been questions about whether too much influence within Facebook has been placed with Zuckerberg and, among some investors, pushes for him to renounce his position as chair of the board. But because of the way Facebook’s shareholder structure is set up — and the number of shares Zuckerberg holds — there’s no way for anyone to force him out.

Facebook may be a publicly traded company, but Zuckerberg pretty much makes the rules.

Zuckerberg gets most of Facebook’s shareholder votes

Shareholders in stocks of publicly traded companies have a certain set of rights related to that investment, including the right to vote on certain corporate matters, such as members of the board of directors, proposed mergers and acquisitions, or executive pay packages.

In most cases, one share of a stock equals one vote, but not always — including at Facebook.

Facebook has what’s called a “dual class” structure of “Class A” shares and “Class B” shares. The Class A shares are what everyday investors on the regular stock market have access to, and they’re one vote per share. The Class B shares, however, are controlled by Zuckerberg and just a small group of insiders. And every Class B share gets 10 votes.

“Companies like Facebook are basically putting in place a share structure that is a bulwark against management change,” Amy Borrus, the deputy director of the Council of Institutional Investors (CII), a nonpartisan association focused on corporate governance, told me.

That means that whatever shareholders are voting on — typically at Facebook’s annual meeting, usually in May — Zuckerberg and those closest to him are always going to win out. Bob Pisani at CNBC estimated earlier this year that Zuckerberg and the group of insiders control almost 70 percent of all voting shares in Facebook. Zuckerberg alone controls about 60 percent.

“Anything that requires a shareholder vote, he gets to ultimately decide whether it’s going to get a majority or not,” Jonas Kron, a senior vice president at Trillium Asset Management, an activist shareholder group with about $2.8 billion in assets under management, told me. “That’s clear as day.”

Shareholders have asked for changes to Facebook’s corporate governance before, and they’re doing it now too

Shareholders of publicly traded companies are usually provided a handful of proposals to vote on each year. Some of those proposals are put forth by the company’s management, and others by shareholders. They’re sent to the broader group of shareholders in proxy statements ahead of a company’s annual meeting.

A board then recommends to shareholders how they think they should vote. Sometimes, outside advisory groups, such as Institutional Shareholder Services (ISS), weigh in on how shareholders should vote as well.

Facebook has handled a number of shareholder proposals every year. In 2018, for example, shareholders proposed putting in place a one-vote-per-share setup and implementing reports on fake news controversies and the gender pay gap. Trillium, the asset management group, in 2018 also put forth a proposal for Facebook’s proxy statement, asking that Facebook put together a risk oversight committee to increase oversight mechanisms at the company.

Facebook’s board recommended shareholders vote against all of those proposals. ISS came out in favor of them. They all failed.

The risk oversight committee idea, while it didn’t make it through the shareholder vote, did eventually wind up actually happening at Facebook. It announced a new “Risk & Oversight Committee” in June, soon after the 2018 shareholder meeting took place.

This year, Zuckerberg’s chair position will be up for a shareholder vote as well — even though, as mentioned, it’s going to fail. Trillium has announced a request for Facebook to bring on an independent board chair (as in, not Zuckerberg) that will be on the 2019 proxy statement. In October, the state treasurers from Illinois, Rhode Island, and Pennsylvania and New York City Comptroller Scott Stringer joined in on the proposal. Combined, they hold about $700 million worth of Facebook shares, Kron told me.

“These are very credible, highly serious investors, putting their names and credibility behind the shareholder proposal and encouraging their fellow investors to vote for it,” he said.

That doesn’t mean it will pass. A similar proposal in 2017, which ISS backed, failed.

Zuckerberg’s fate as chair of Facebook “isn’t up to anyone but him,” Charles Elson, director of the Weinberg Center for Corporate Governance at the University of Delaware. “He has the votes under [the current] structure, and nothing’s going to change.”

This isn’t unique to Facebook

Outsize control given to corporate executives isn’t unique to Facebook. As Pisani at CNBC pointed out, Rupert Murdoch and his family have all the voting power at News Corp. At Google, there are three classes of stock, but the B shares controlled by Larry Page, Sergey Brin, and Eric Schmidt account for some 60 percent of voting shares.

Borrus, from CII, told me that about 10 percent of publicly listed companies have a multi-class share setup, but the proportion is growing among newly public companies, especially in tech. Last year, 19 percent of companies that went public on US exchanges had at least two classes of stock with differential voting rights. In 2005, it was just 1 percent, Borrus said. (Snapchat parent Snap was a highly publicized case because the shares it made public didn’t have any voting rights at all.)

Proponents of such structures, including at Facebook, argue that they help make a company more stable and insulate the board and management from short-term pressure, allowing them to stay focused on long-term success. Facebook has also pointed out that its dual-class structure has been in place since 2009, well before it first went public in 2012, and investors who bought the Class A shares knew that.

But critics of the dual-class setup say that case doesn’t make sense.

ISS said this year that two of its recent studies found that companies with a multi-class structure “generally underperformed” companies without that structure in three-, five-, and 10-year periods. Borrus told me growing academic research suggests that when companies go public, the multi-class structure might at first give them a boost, but that fades to a discount within six to nine years. CII recently petitioned the New York Stock Exchange and Nasdaq to sunset multi-class structures within seven years of an initial public offering.

“Multi-class structures deprive public shareholders of a meaningful voice to affect how a company is run,” Borrus said. “It might sound good with a charismatic founder, but in the long run, it’s bad for investors.”

Zuckerberg might not be the problem at Facebook, but it’s not clear he’s got a solution

All this isn’t to say that Facebook has been a bad investment — it went public at $38 per share, and it’s now trading at about $140. Zuckerberg has steered the company through some tough times, and Sandberg, who joined Facebook in 2008, has been seen as a sort of adult in the room and a steady hand.

Ivan Feinseth, the chief investment officer and director of research at the financial firm Tigress Financial Partners, told me he thinks Zuckerberg has done an “incredible job” at Facebook and mapping out a mission. But he conceded Zuckerberg probably should no longer be board chair.

“I don’t believe he’s the cause of the problems, and I think his management of the company has been very good,” he said. “They do have some near-term problems.”

But given Facebook’s stream of missteps and apologies, essentially since its inception, it’s difficult not to wonder whether bringing about at least some sort of leadership change at Facebook might make a difference. The company’s current management seems not to know how to dig itself out of the hole it’s in, and shareholders can’t try to hold them accountable.

Facebook’s structure “leads to a culture of unaccountability, which ultimately leads to problems,” Elson, the Delaware professor, said.

To be sure, that doesn’t mean there’s absolutely nothing to be done. Facebook’s board could, conceivably, revolt, like Uber’s board did with former CEO Travis Kalanick. The Securities and Exchange Commission forced out Elon Musk as Tesla’s chair, though that was an extreme case.

The November Times story describes board member Erskine Bowles, who heads Facebook’s Oversight & Risk Committee, as having “pelted questions” at Zuckerberg and Sandberg over their knowledge of Russian interference, indicating some unrest on the board. But after the Times story broke, Facebook’s board put out a statement supporting Zuckerberg and Sandberg, who also happen to be part of the body anyway.

Ultimately, it seems as though some sort of a management change at Facebook will have to come from Zuckerberg himself. He’s the only one who can make the decision. Kron, from Trillium, said he’s still holding out hope he will.

“For a long time, Facebook and Mark Zuckerberg, they’ve thought of Facebook as being something special and something different, so they didn’t need to play by the same rules as everybody else, and we’re starting to see that’s not true,” he said. “What we’re talking about in these circumstances is Mark Zuckerberg listening to his investors and listening to voices from Wall Street that are encouraging him to do what’s good for him, for the company, for American democracy, and for the company’s users, and build in an independent board chair and then start rebuilding some trust.”"

MY COMMENT

NOTE.....that the data and other information in this article from late 2018 is out of date. BUT....I dont think the shareholder format at META has changed.

Unfortunately when you have total control of a company like Zukerberg at META....you had better have a good true business vision for the company. Go off chasing fantasy rabbits......in a fake online world......and what you get is what is happening to META right now. This is NOT a function of the pandemic....or even the bear market....this is a company that is committing financial and business and management SUICIDE.....compliments of the single controlling owner, Zukerberg.......in front of the whole world. I am sure at some point if it gets bad enough there will be potential for change.

Personally......I avoid it all by NEVER owning this company.

 

I see from this....up to date article....that nothing has changed at META in terms of who controls the company.....legally.

Meta shareholders vent anger at Zuckerberg’s spending binge
CEO seems intent on using majority control to push ahead with big bet on metaverse despite Wall St scepticism

https://www.ft.com/content/0f4c676c-56a6-4b5e-850f-ddb78f9feb40

(BOLD is my opinion OR what I consider important content)

"Some of Meta’s biggest shareholders have lined up to vent their anger at the social media company’s management after it stunned Wall Street with plans to ramp up its lossmaking effort to build the metaverse.

Even after a slide that has wiped 74 per cent from Meta’s stock price in little over a year, however, investors and boardroom experts said there was little outsiders could do to prevent chief executive Mark Zuckerberg using his majority control to plough ahead with a bet that has lost the confidence of Wall Street.

Meta’s shares tumbled 25 per cent on Thursday after the company revealed that losses from Reality Labs, its division that is building the metaverse, would grow “significantly” in 2023, after reaching $9.4bn in the first nine months of this year. Investors were also startled by another jump in capital spending that Meta said would consume as much as $39bn next year, more than double the level of 2021.

“If any other company had done this you’d have activist investors writing letters, proposing alternative slates of directors, demanding change,” said Jim Tierney, chief investment officer for US growth at AllianceBernstein, a Meta shareholder. “I think Mark heard crystal clear what investors wanted. He’s made his decision.”

The anger has spilled over into meetings with management, some of which Zuckerberg has attended personally since Meta shocked Wall Street with its spending plans late on Wednesday.

“It does seem like there’s a sense of frustration” among investors over the company’s ballooning costs, said one person familiar with the discussions.

Referring to the series of informal follow-up calls with investors after the company announced earnings late on Wednesday, Tierney said: “When people had callbacks with the company they got more disgusted, not less disgusted.”

“Zuckerberg was tone-deaf to the investment community, doubling down on everything,” said David Older, head of equities at €33.2bn asset manager Carmignac, which has holdings in Amazon, Microsoft and Google but not Meta. “The timeline for the metaverse is very stretched. I don’t think you’re going to know if it is the right move for five or 10 years.”

Asked what impact the shareholder unhappiness would have on its plans, Meta said: “We value the opinions of our investors and regularly engage with them to ensure we’re aware of their respective perspectives.”

Like many companies, Meta regularly holds meetings in the days after it reports quarterly earnings, even though Zuckerberg’s full personal control means he can ignore their views. The Meta co-founder owns 13 per cent of the equity in the company but controls 54.4 per cent of the votes through a special class of shares.

Meta would not comment on whether the complaints had led to any renewed discussion inside the company about the scale of its spending. It said: “Meta’s management team, with oversight from the Board of Directors, is focused on executing on the company’s key priorities with an eye toward creating long-term shareholder value.”

Shareholder frustration at Zuckerberg’s personal control over Meta has crept up in recent years as the company has found itself at the centre of repeated controversies over misinformation and privacy, and as it has bet big on the metaverse. A shareholder proposal to scrap the supervoting shares received 28 per cent of votes at Meta’s annual shareholder meeting earlier this year, despite Zuckerberg’s majority stake. That was up from the 17 per cent support a similar proposal received in 2014.

Legally, Meta’s directors have a responsibility to represent all shareholders, even if the chief executive controls who is elected to the board, said Steve Diamond, a corporate governance expert at Santa Clara University School of Law. A court can intervene on behalf of shareholders if a board is found to have engaged in “waste” of the company’s resources, though that is “a very high standard to meet” and has almost never been upheld, he added.

“I’m astounded by how much they have already spent [on the metaverse] and they have little to show for it,” said Diamond. “If this was any other CEO who had only a 1 per cent stake, he’d probably be gone.”

The lack of any formal avenues to change the company’s direction has forced would-be shareholder activists to take a conciliatory approach. In an open letter to Meta directors shortly before the latest earnings last week, Brad Gerstner, of Altimeter Capital, resorted to flattery to try to get the chief executive’s attention. He complimented Meta’s business, before urging the company to cut at least 20 per cent of its staff, slice $5bn from its capital expenditures and cap its annual spending on the metaverse at $5bn.

“Everyone agreed with Brad Gerstner’s open letter to Zuckerberg,” said Carmignac’s Older. “You can have a great stock and still invest $5bn a year in the metaverse but you’ve got to be disciplined on costs and be disciplined about how you’re investing.”

In a call with analysts on Wednesday, Meta executives tried to head off the unrest by pointing out that 82 per cent of the company’s spending in the latest quarter was on its existing services, rather than the metaverse.

Some tech investors said Zuckerberg might be justified in pushing aggressively, given the scale of the risk his company is facing. Apple’s move to limit the data that its apps can collect on its devices severely dented Meta’s advertising revenue and appeared to have convinced the Meta chief that he had no choice but to go all-in on trying to build the next important computing platform, said Kevin Landis, at Firsthand Funds.

The huge value shifts seen during previous significant transitions in the digital world might also justify Zuckerberg’s inclination to ignore dissenting views and plough ahead, Landis suggested. “If this was a classical governance structure, we would have decision-making by committee and the back-and-forth squabbling would be endless,” he said. Much of the unhappiness has stemmed from Meta’s failure to give any timetable for when the spending binge might pay off, said Tierney. “They’re spending $15bn a year on the metaverse and they can’t give us any mile-markers. It’s just a big hope.”"

MY COMMENT

Again......sorry META fans. I hope you.......prove me wrong in reality and make a bundle of money from this stock. It would not bother me....since your success with this company would not impact me in any financial way. I will celebrate your success.

 

OK....enough META bashing.

It is time to celebrate.....it is ELECTION EVE. From an investing standpoint.....I am looking forward to having GRIDLOCKED government. That will help to give us a good clean runway for stocks to deal with the FED, the bear market, and other issues over the next couple of years......with much less government in the middle.

It will be interesting to watch it all play out tomorrow.

 

OK....after today I am now....YTD (-29%). Right now I am in the middle of the range that I have been stock in for the past months.

I am STILL...."hoping".....for a post-election bounce to the markets.

 

Yes......I do have a FB account......but I dont use it and never have. I do NOT have the FB app on my phone and probably go there on my computer about once a month to post the current show schedule. I dont message people or follow anyone or do anything on FB or using FB. I pretty much find it to be worthless.....to me. BUT....that is just me.

The problem with FB is they are losing their prior successful business model based on advertising and using their customers as their product. The issue for FB will be avoiding ending up like the "Blackberry" of social media.....or....ending up as the next MySpace. The current attempt to switch the business model to the METAVERSE is failing spectacularly.

 

I have been siting and watching the markets today since before the open. The direction was suspect after the open but it seems to have settled in as positive slowly over the first hour or so. Bit by bit we move forward......one step forward.....one step backward.

 

HAPPY ELECTION DAY.

Stocks edge higher ahead of midterms, inflation data

https://finance.yahoo.com/news/stock-market-news-live-updates-november-8-2022-125124481.html

(BOLD is my opinion OR what I consider important content)

"Stocks edged higher Tuesday morning as investors await the outcome of the midterm elections in the U.S.

The S&P 500 (^GSPC) inched higher by 0.1%, while the Dow Jones Industrial Average (^DJI) ticked higher by 0.3%. The technology-heavy Nasdaq Composite (^IXIC) rose by 0.2% in early morning trading.

On Monday, U.S. stocks rose ahead of another week of potential market-moving events: corporate earnings, midterm elections, and inflation data.

Investors are focused on Tuesday’s midterm elections that will determine control of the House and Senate for the remainder of President Joe Biden’s first term. Historically, Wall Street has preferred a split Congress or White House, with political gridlock that could impede major policy changes, an outcome that investors see as favorable for equities.

According to JPMorgan’s latest client survey, 39% of respondents were split on whether the U.S. midterm elections will be a positive catalyst for risk markets or non-event, while 21% expected negative implications. Regardless of the winner, some strategists argue that midterm outcomes have a “modest” influence in financial markets.

“The overall near-term implications of the 2022 U.S. Midterm Elections are quite modest for FX markets,” Meera Chandan, FX strategist at JPMorgan, wrote in a note to clients. “Markets should thus continue taking guidance more from the Fed’s monetary policy decisions than from any new large fiscal packages. One wildcard worth flagging is the risk of renewed uncertainty around the debt ceiling.”

Another closely watched item this week will be the Thursday release of October inflation data. Economists surveyed by Bloomberg expect headline CPI at an annual rate of 7.9%, down from 8.2% the month before. Even if the report shows prices starting to moderate, core CPI is far above the Fed’s comfort zone.

“The problem is going to be that in month over month terms, I think we're still going to see a fairly strong core CPI,” Franklin Templeton Fixed Income CIO Sonal Desai told Yahoo Finance Live on Monday. “And I don't think that a combination like that, together with the relatively strong jobs numbers we got on Friday, it's not going to give the Fed much comfort in terms of changing the path which was outlined by Chairman Powell last week.”

Some Wall Street banks, including UBS, expect the U.S. to head into a "hard landing." Indeed, Federal Reserve Chair Jerome Powell said the path to achieve a "soft landing" has narrowed because the Fed hasn’t seen inflation coming down.

“The US economic expansion already looked precarious. After one of the most rapid recalibrations of monetary policy in several decades, the full effects remain to be seen,” Jonathan Pingle, managing director and chief U.S. Economist at UBS, wrote in the bank's Global Economics & Markets Outlook 2023-2024 report.

“With meaningful imbalances remaining in the US economy as a result of the pandemic, we expect 2023 to bring an economic downturn, or correction. The good news, resolving the tensions we think sets the US economy up after 2023 for better years ahead,” he added.

Meanwhile, in a new note from Goldman Sachs, chief economist Jan Hatzius puts the likelihood of a recession in the U.S. over the next 12 months at 35% amid the central bank's aggressive tightening moves.

“We still see a very plausible non-recessionary four-step path from the high-inflation economy of the present to a low-inflation economy of the future,” Hatzius wrote in the note.

Earnings reports also continued to trickle in on Tuesday. Among the highlights:

• Planet Fitness (PLNT): The fitness gym posted third-quarter profit and revenue that topped expectations and raised its full year growth outlook as membership reached a record with joins back to pre-pandemic seasonal trends.
  
  
• DuPont de Nemours (DD): The chemicals giant posted a beat for their third-quarter earnings and reaffirmed its full-year guidance.
  
  
• Norwegian Cruise Line Holdings Ltd. (NCLH): The cruise line operator reported a narrower-than-expected third-quarter loss on revenue that topped forecasts and as an adjusted earnings metric reached profitability for the first time since the start of the pandemic.
  

Disney (DIS), AMC Entertainment Holdings (AMC), Affirm Holdings (AFRM), and Lucid Group, Inc. (LCID) are set to report earnings after the bell on Tuesday.

In the bond market, the yield on the 10-year Treasury note edged up 4.205% Tuesday. Oil markets, meanwhile, Brent crude, the international benchmark, weakened for a second day, falling to $97.71 a barrel. The U.S. dollar index rose slightly after falling the most over the past three trading sessions since 2020."

MY COMMENT

DISNEY will be the big dog of the day in terms of earnings. I dont follow them so I have no idea what they will do.

At least it is nice to see NOTHING in the above about the FED. Of course the CPI data later this week will trigger the usual massive FED speculation.

 

Here is a little article on mid-term elections.

Midterm elections: What 60 years of stock market data says

https://finance.yahoo.com/news/midterm-elections-stock-market-112234022.html

(BOLD is my opinion OR what I consider important content)

"Bring on Nov. 9.

With the midterm elections underway today, investors are eyeing if Republicans could win back control of government and more effectively stop any and all legislation that could rattle markets.

"Gridlock, you've seen, has been pretty good for the markets," Maslansky and Partners president Lee Carter on Yahoo Finance Live. "I think people are predicting that at least that's the direction we're going to go. And when we've talked to Republicans who are running, ... what we're going to do from between now and 2024 is just stop Biden's agenda."

Recently, stocks are trading as if the Republicans — usually seen as pro business and markets —will make substantial progress.

The S&P 500 has climbed nearly 5% in the past month despite a flurry of downbeat earnings reports from the likes of Amazon, Meta and many others.

Investors may be right to be on the bullish side of the ledger.

The S&P 500 has historically outperformed the market in the 12-month period after a midterm election, with an average return of 16.3% per data from US Bank. This is especially the case for the one and three month periods following the midterm elections, as the below graphic shows.


Stocks tend to do well post mid-term elections."
MY COMMENT

I am not expecting some big turnaround from the election. BUT....I do see potential for a solid short term bump....if the results are right.

It is not going to be a defining moment.......but.....it will be another box checked off for the markets....and may give us a pause in the negativity for a short while. At best it might even be the catalyst for a year end rally. BUT.....I do not see it as ending the bear market. The FED will continue to be the drag on the economy as we enter 2023.

 

This little article is simplistic.....but I like it.

Rich people don’t have a ‘lottery mindset,’ says CEO—here are 3 things millionaires do differently

https://www.cnbc.com/2022/11/08/ive...he-3-habits-that-made-them-ultra-wealthy.html

(BOLD is my opinion OR what I consider important content)

"Everyone approaches money differently, and I’ve always been fascinated by how the world’s wealthiest people do it.

As a CEO and host of the podcast “We Study Billionaires,”I’ve interviewed 25 billionaires and more than 100 millionaires, including prominent investors like Howard Marks and Cathie Woods.

What have I learned from them? For starters, rich people don’t have a “lottery mindset” — or the belief that there’s a shortcut to instant wealth by virtue of random luck.

Here are three habits they share that anyone can adopt:
1. Rich people don’t act on fear or impulse.

The most financially successful people have a passion for solving puzzles — and they treat the stock market the same way.

When I interviewed billionaire

Howard Marks, co-founder of Oaktree Capital Management, we talked about how he got through periods of upheaval like the Great Recession and the early days of the pandemic.

Instead of making decisions based on fear, he said he focused on the data and potential opportunities, rather than on the risks or downsides.

Using this approach, he made a successful bet on distressed corporate debt during the 2008 financial crisis, which earned Oaktree investors about $6 billion in gains.

If you find yourself faced with uncertainty, Marks recommends taking emotions out of the equation, and looking for ways you can make the circumstances work for you.

2. Rich people are patient and think long-term.

One of Warren Buffett’s biggest success factors is that he invests businesses that have potential to grow in value decades into the future, no matter what their stock prices might be at any given time.

Many billionaires have admiration for Buffett’s approach and how much patience it requires. At a conference, Airbnb co-founder Brian Chesky spoke about a memorable lunch he had with Jeff Bezos and Buffett.

During that lunch, Bezos recalled one of his first meetings with Buffett, in which he asked him: “Your investing thesis is so simple. Why doesn’t everyone just copy you?”

“Because no one wants to get rich slowly,” Buffett replied.

3. Rich people say “no” more than they say “yes.”

I recently interviewed billionaire David Rubenstein, co-founder of private equity firm Carlyle Group. He is a philanthropist who serves as chairman on several boards. He is also the author of three books and host of PBS’ “History with David Rubenstein.”

When I asked him how he gets so much done, he was quick to note all the things he doesn’t do: No golf, no drinking alcohol, no binging on Netflix. He avoids all the things that he believes drains his time.

Billionaire Jesse Itzler agrees about the power of saying “no.” Itzler is the co-founder of Marquis Jet, one of the world’s largest private jet card companies, a partner in Zico Coconut Water, the founder of The 100 Mile Group and an owner of the NBA’s Atlanta Hawks.

“Your 20s and 30s are a great time to say ‘yes,‘” he told me in a podcast interview. “You want to network, get exposure and build. But your late 40s and beyond are a great time to say ‘no’ and take full control of your time.”

His tip for saying “no” to someone gracefully: “Follow up with something amazing. Send a dessert or pick up a bill. Choosing not to do something doesn’t mean you have to be out of the game.”"

MY COMMENT

So simple as usual........and so difficult for most to do. As usual the LONG TERM mindset is critical.

 

Well FB does not make anything from me.....since I do not ever use their phone app and never am on their site or using any of the features of the site except for once a month, to post a schedule. I ALSO do not ever use.....Twitter, Instagram, or any other social media site. I never log into anything using Facebook, or Google, or any of the other services that are constantly trying to get you to use them to long in to everything in your daily life.

In fact.......I still pay ALL bills by writing a check and mailing the bill each month. I try to stay INVISIBLE......although that is impossible in the modern age.....since I routinely use a couple of credit cards, and a debit card. I am very good with technology and computers.....but I refuse to allow everything in my house to be wireless. I dont need internet based lights, thermostats, irrigation, garage doors, etc, etc, etc. ( of course there are many things in a modern home that are actually wireless even if you are not using them)

Of course......I do have a smart TV and use various streaming services on the TV......Netflix, Prime, Paramount +, and Disney......so any hope of staying off the radar is totally undermined by the fact that my TV can spy on my entire home life.

I covered the camera on my computer with a piece of tape for as long as there has been a camera. Now I use a little slider that covers the camera and I can slide it to open it......if I have a meeting or something where I need the camera. EVERYONE used to give me total SH%T for having that tape on the camera. Than one day I saw a photo of Zuckerberg next to his desk......and there on his computer......was a piece of tape covering the camera.

In fact this site......STOCKAHOLICS.....is the ONLY site that I post to. I prefer to stay under the radar and anonymous in my daily life.

I know in the end...trying to avoid having your life as an open book is impossible.....since I use the computer daily all day long.

 

For Zukodany......my beef with Meta is two things:

1. I do not like their corporate structure that gives Zuckerberg total control of the company over the totality of all other shareholders.

2. I do not think that their switch to the Metaverse......will ever be successful......and.....will in the end KILL the company.

I can see how their old business model based on "FACEBOOK" was successful......but the META stuff.....I see as doomed to fail and take the company down with it.

BUT......since I dont own the stock......I really dont care. I hope those that do own it make a bundle.

 

I was GREEN today in my account. A nice moderate gain today. I did get beat by the SP500 by 0.12% today. My losers today were TSLA and AMZN.

A good day and two green days in a row.....actually three in a row if you count Friday. We are on a little streak.....which might have some legs if the election turns out the way that I anticipate and we get the GIFT of gridlocked government.