Morgan Housel had a great pice titled ‘Wounds Heal, Scars Last‘ that had some insights to behavior that may change post COVID.
On today’s ‘Panic With Friends’ I had a long conversation with my old friend Herb Greenberg. As a financial reporter back in the 80’s and 90’s before heading to The Street.com in 1998, he has seen the wounds and scars that stocks and companies leave on people.
Today Herb has a research firm (Pacific Square Research) with a few partners in San Diego. I really enjoyed this conversation.
Before I get started…my pal Phil Pearlman had the perfect tweet to summarize the last month in American business:
We went from Trillion Dollar Market Caps to Trillion Dollar Bailouts in one month.
I meet tens of thousands of traders and investors on Stocktwits and this year one has really stood out. His name is Marcus and he goes by Marcus Aurelius on Stocktwits. In February he began journalling a trade that had him very short the S&P. Marcus is an options trader and a student of Nassim Taleb (author of many books including Antifragile). I followed along over the last month as made incredible profits from the trade. The powerful thing about Stocktwits is the timeline. There is no deleting messages. Marcus comes to Stocktwits to journal his investing ideas.
In today’s ‘Panic With Friends’ Marcus walks me through the decisions and the timeline which is fascinating. You can hear what he thinks comes next. It is NOT the end of the world, but it is involves a lot more grief and pain. I learned a ton from the conversation.
I had Paul Tran the founder of Manscaped on today’s ‘Panic With Friends’. Paul founded Manscaped, which is the fastest growing company we have ever invested in at Social Leverage.
I had Paul talk about how he is building an omnichannel brand at record pace, new products (the weed wacker for nose hair trimming), and the relentless pace the company is keeping through the panic of COVID-19.
Manscaped is based in San Diego and has over 60 employees and you can order the product on the website or now grab them at Target.
Every entrepreneur and investor will enjoy listening to Paul explain the challenges and opportunities of building a brand in a ‘whitespace’ category and how he is thinking about growth.
The latest is with a young, independent trader who has made a small fortune the last month catching the crash in the S&P. I know this because he has shared the trade in real-time every day on Stocktwits for the last month. He is a ‘crisis chaser’ trader and he lined up with the virus to catch and ride the perfect storm. We chat about what he saw and did that others did not. Here is the episode with Marcus.
In my world, everyone is talking about Telemedicine, Work From Home and Teaching Online.
If you follow the markets, the stocks that represent these big themes that are doing the best are – Teledoc, Zoom and Docusign. Despite the crash they are going up almost everyday.
As a reminder, Marketsmith (by Investor’s Business Daily) is now a sponsor of the weekly show. All the charts you have been seeing in the videos and will continue to see are from Marketsmith. They are offering my readers a three week trial for $19.95. Click this link if you would like to try it out.
It’s Monday, which means Ivanhoff and I did our weekly video covering the markets and momentum. The momentum is all to the downside and a nasty bear market continues. I have no idea what traders and investors are looking for as the panic continues. I imagine it is some sort of positive data about the Corona virus.
At the end of the video, I riffed on a plan that I am putting into action on further weakness
It’s easy right now to call Americans dumb and unprepared. This riff is not about the health crisis so please do not be offended…just thinking out loud for a minute about the future of markets…
This will pass. The massive stimulus is upon us. I have no idea when it will work and there will be massive unintended consequences of it and the Corona health crisis.
By the end of the 4th quarter – assuming the virus is contained – the stimulus should hit and help.
If you liked stocks at all-time highs just 28 days ago and now do not want to own stocks, you should consider moving to Russia.
After indexes drop 30-50 percent, historically the next 10 years have much better annual returns.
Take a portion of your free cash and act like a venture capitalist and pick a basket of stocks. I will commit 10-20 percent of my free cash to some brands that I love and live with and spend on that I do not need to check prices for at least 6 months (because I may buy more)
Yes you may lose that whole 10-20 percent, but if you do, we are fucked anyways. If we don’t you may make venture style returns 3-5 years out from owning this basket of liquid stocks. I like those odds.
I know two things:
1. We are going to lose many freedoms and conveniences
2. The big leaders will get bigger. Starbucks and likely $LK (china) and LULU and MCD will have less corner store competition. The cash rich tech companies will be buying teams and companies at pennies on the dollar.
PS – Also all the ‘Panic With Friends ‘ 22 podcasts already – are here
Disclaimer: All information provided is for educational purposes only and does not constitute investment, legal or tax advice, or an offer to buy or sell any security. For full disclosures, click here.
I have been reading up on crisis management and my favorite takeaway so far is that for most leaders the best corse of action is that once you acknowledge the issue is to overcorrect.
Almost every company in America has the same issue…people working from home and revenues plunging. The best crisis leaders are going to be overcorrecting to get through to the other side. It is not pleasant. It is what leaders signed up for though.
As my guest on the podcast today says…this is war.
Paul Traub (Consilium Advisors) is a great friend and mentor who has been through many business wars as a restructuring lawyer in Manhattan. He joins me today on the podcast to discuss this panic and calmly talk about his own past crisis(s) and offers some insights on how to work through the current disaster.
Today I called my friend Bill Bishop in Washington, DC.
Bill and I have only met once, in Beijing, but we have known each other for over 15 years. Bill publishes a fantastic newsletter called Sinocism that will make you smarter about China. Bill and his wife and two kids spent over 10 years in Beijing before moving back to DC. In the very early days of the internet, Bill helped build Marketwatch which is now a Dow Jones company. Bill is also a seed investor in Stocktwits. You can follow Bill on Twitter as @niubi.
I wanted to have Bill on the podcast to talk about the Corona Virus and the tension between China and The US as the virus spreads. Bill has a unique flow of information built from his years in Beijing.
The podcast is with my pal and Stocktwits head of content and community Phil Pearlman. I call him my markets ‘shrink’. I could laugh and talk markets and life with Phil all day and that is what we did in this conversation about panicking and life. Phil is a behavioral psychologist which means for $300 he will sit with you and help blame everything on your mom. Problems solved.
Here is a link to the podcast. You can also listen to them on Spotify or Apple Podcast by searcing my name.
I am really tired. We all are. We have to keep grinding away.
I will make this quick.
Today’s podcast is with my friend Yoni Assia, founder and CEO of Etoro who I dialed up in Tel Aviv. I met Yoni back in 2010 and I knew right away we would invest. So we did. I think Etoro was 20 people at the time. I called the venture capitalists I knew when I got home and said Etoro is like ‘Zynga, but for men’. Spark Capital ended up leading an A round and off to the races Etoro went.
Today, Etoro has 850 employees and people can trade in 140 countries.
In this wide ranging conversation Yoni and I catch up on the historic market movements, panic, volatility, the future, Bitcoin (Yoni was the person that mentioned I should buy Bitcoin in 2010 at 12 cents. I said it was overvalued..whoops).
I think you will enjoy his perspective.
You can listen to it here. All the episodes of Panic With Friends are up on Spotify or Apple Podcasts if you search my name.