Episodes
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A Look at the Official Kick-Off to the 2017 Holiday Shopping Season Download Episode Coming off the Thanksgiving holiday, this week Tematica’s investing mixologists Chris Versace and Lenore Hawkins discuss the meaning of the litany of data points for online shopping on Thanksgiving as well as overall results for Black Friday. Expectations were running high for continued wallet share gains by digital shopping, a key aspect of our Connected Society investing theme, and they did not disappoint. What was surprising was the percentage of holiday shopping done via smartphones. Both the objective data, and as Chris and Lenore share, the anecdotal evidence, point to brick & mortar retail traffic over the holiday shopping weekend that was hardly robust. Per data from ShopperTrak, brick & mortar retail sales fell just under 2% year over year. No wonder retailers like Kohl’s (KSS) and JC Penney (JCP) were trying to put a positive spin on things by talking up their digital shopping. We continue to see brick & mortar retailers as challenged and remain bearish on mall operators. While the holiday shopping season is off to a stronger start than last year, we still have some reservations about the final tally matching the National Retail Federation’s typically overly optimistic holiday shopping forecast calling for 3.6%-4.0% growth over last year. On the one hand, we’ve had tepid wage growth, ballooning credit card debt and student debt, which tells us the Cash-Strapped Consumer will be out in force this holiday shopping season. As we point out, roughly two-thirds of shoppers over the Thanksgiving to Cyber Monday period were looking to capitalize on retailer deals and promotions. To hammer the point home, Cyber Monday is expected to be the biggest stand-alone day of the shopping long weekend. Expectations call for $6.6 billion to bought on Cyber Monday, up 16.5% year over year. To us, however, the real context is that’s not only looking like another record year, but it’s 32% greater than Black Friday online sales this year. Which companies are best positioned to capitalize on our Connected Society, Cash-Strapped Consumer, Rise & Fall of the Middle Class and Affordable Luxury investing themes this holiday season? You’ll have to listen to the podcast to find out. Along the way, you’ll learn what the number two gift item will be this year and we’ll mention a sleeper gift card company that is a contender for our Cashless Consumption investing theme as well. Companies mentioned on this podcast Adobe Systems (ADBE) Amazon (AMZN) Apple (AAPL) Best Buy (BBY) Blackhawk Networks (HAWK) JC Penney (JCP) Kohl’s (KSS) Macy’s (M) MasterCard (MA) National Retail Federation Simon Property Group (SPG) Shopify (SHOP) ShopperTrak Starbucks (SBUX) Target (TGT) Visa (V) Wal-Mart (WMT) Resources for this podcast: Chris Versace – @_ChrisVersace Lenore Hawkins – @EllesEconomy Tematica Research – https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting Cocktail Investing: Distilling Everyday Noise into Clear Investment Signals for Better Returns Books we’re currently reading: Versace: The Innovation Blind Spot: Why We Back the Wrong Ideas—and What to Do About It Hawkins: How Money Got Free
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Download Episode As we get ready to break for the Thanksgiving holiday and prepare for the 2017 holiday shopping season to hit in full force, we’re also seeing a lot of headlines and stories on autonomous vehicles, which is one aspect of our Disruptive Technologies investing theme. Here’s a sampling of what we’ve seen in just the last few weeks: Uber Strikes Deal With Volvo to Bring Self-Driving Cars to Its Network 7 Lessons From Cadillac's Partial Self-Driving Car Volkswagen to Invest $40B+ on EVs, Autonomy Driverless cars on British roads as Jaguar Land Rover moves ahead in race for autonomy Foxconn Floats the Idea of Autonomous Vehicle-Only Lanes on Wisconsin Interstate Japan hopes to show off self-driving cars at 2020 Olympics Driverless trucks are coming to Canada and the impact will be profound Fully autonomous cars to be on UK roads by 2021 Autonomous cars likely to transport elderly, children in future Several of those headlines, to our delight, show this Disruptive Technologies meshing with several other Tematica investing things, like Aging of the Population, Rise & Fall of the Middle Class and Asset-lite Business Models. The only thing better than a strong thematic tailwind in the intersection or two or more thematic tailwinds. When we see an array of headlines like the ones we shared above that denote a flurry of activity, it can lead to questions and sometimes confusion as investors new and old look to understand the opportunities as well as potential risks and timing That’s why on this week’s episode of Cocktail Investing, we’re sharing an excerpt of our conversation with Brad Stertz, Director of Government Affairs at Audi, to put some context and perspective around the market opportunity for autonomous vehicles. Companies mentioned on this podcast Alphabet (GOOGL) Amazon (AMZN) AT&T (T) Avis Budget Group (CAR) Delphi Automotive (DLPH) FedEx (FDX) Ford (F) General Motors (GM) Hertz Global Holdings (HTZ) Intel (INTC) Lyft Motorola Solutions Inc (MSI) Nuance Communications (NUAN) Nvidia Corp (NVDA) QUALCOMM (QCOM) Tesla (TSLA) T-Mobile (TMUS) Uber United Parcel Service (UPS) Verizon (VZN) Volkswagen AG (VLKAY) Resources for this podcast: Chris Versace – @_ChrisVersace Lenore Hawkins – @EllesEconomy Brad Sterz — @BradSterz Tematica Research – https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting
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Download Episode The Economic Impact of the Expanding Global Middle Class This week, Tematica's investing mixologists Chris Versace and Lenore Hawkins walk through the global impacts of the Rise and Fall of the Middle Class, focusing in Part I of this series on the Rise portion of this investing theme. The expanding global middle class will account for nearly half of all consumption in the coming years, but as we discuss the where and why behind this new middle-class is reshaping industries and business models at Amazon (AMZN) and General Motors (GM) to McCormick & Co. (MKC) and many, many more. For over 90% of the past two millennia, China and India dominated the global economy, generating over half of the world’s GDP in terms of real purchasing power. The end of the 17th century saw a seismic change with the start of Europe’s Industrial Revolution, which later spread to the New World. From 1820 to 1950 Asia’s share of GDP plunged from just under 60% to 16 percent and by the middle of the 20th century the West had come to dominate global growth with the United States generating over a third of world GDP by the end of World War II and when combined with Western Europe, accounted for nearly 60% of global GDP. However, this would not be permanent. Asia’s return to its multi-millennial dominant role began in the 1950s and started accelerating in the 1980s to rise from 16% to over 30% by 2000. Today Asia’s share of global GDP, excluding the Middle East, has reached a 160-year high of 43%. During that time, the share of the United States and Western Europe has fallen to a 166-year low of 33%, with the U.S. share cut to half its mid-20th peak and Western Europe losing nearly one-third of its share just since the start of the 21st century — all part of the story behind the Rise portion of our Rise and Fall of the Middle Class as the west loses its dominance while emerging economies come into their own. The incredible volume of sales generated by Alibaba (BABA) over the weekend for Singles’ Day illustrates the reemergence of that economic power and the convergence of our Rise and Fall of the Middle Class with the Connected Society as a stunning 90% of the transactions were done via mobile, which we discussed here earlier in the week. As the center of gravity for middle class households shifts from west to east, it will open up new opportunities for those companies that adjust their strategies accordingly, generating tailwinds for growth. Those that miss this tectonic shift will face challenging headwinds. Along the way, our mixologists talk about which sectors and companies are poised to prosper from the emerging middle class in the East as well as giving an assessment of the recent moves in the markets. Companies mentioned on this podcast Alphabet (GOOGL) Amazon (AMZN) Apple (AAPL) Ford Motor (F) General Motors (GM) Home Depot (HD) McCormick & Co (MKC) Samsung (SSNGY) Target (TGT) Wal-Mart (WMT) Whirlpool (WHR) Resources for this podcast: Chris Versace - @_ChrisVersace Lenore Hawkins - @EllesEconomy Tematica Research - https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting Cocktail Investing: Distilling Everyday Noise into Clear Investment Signals for Better Returns Books we’re currently reading: Versace: Pines Hawkins: Quantum Physics for Poets
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Download Episode This week, Tematica's investing mixologists Chris Versace and Lenore Hawkins discuss numerous current headlines that illustrate the power of some of Tematica’s investing themes. The powerful intersection of Content is King, Connected Society and Disruptive Technology themes has driven a company like Apple to evolve from primarily a hardware and associated OS developer into now producing shows with Hollywood stars Jennifer Aniston and Reese Witherspoon. Apple is also moving deeper into our Cashless Consumption theme as its latest iOS beta software debuts Apple Pay Cash The combined force of Disruptive Technology, Connected Society and Cashless Consumption is lifting millions of people in sub-Saharan Africa out of poverty. While the velocity of corporate earnings begins to slow, we’re once again hearing of brick & mortar retail woes as same-store-sales growth continues to fall. Our mixologist also breakdown the current state of the markets and analyze the latest economic data rolling in, much of which is at least flashing a yellow warning light: Oil prices are the highest they’ve been since 2015, putting a strain on the already struggling Cash-Strapped Consumer as gas prices soar 17% year over year. The dollar continues to strengthen, which is a headwind for those companies that generate a large portion of sales overseas – we’re looking at you big tech. Corporate debt levels are at record highs and margin debt has been growing at a 12% annual rate while equity fund cash balances are at near record lows – who’s left to keep buying and what does it mean if the market hits a speed bump? With trading volumes falling and breadth getting weaker, we can see that those indices are breaking new record highs based on fewer and fewer buyers. Another reason we ask, who’s left to keep buying? With Investor Intelligence survey reporting 5 bulls for every bear and Market Vane putting equity bulls at 70%, near the top of the historical range, who’s left to get bullish? In D.C., tensions are rising as the GOP lost some key battles for state governors as President Trump’s approval rating continues to drop, making tax reform by year’s end increasingly unlikely. If holiday shopping is weaker than expected and tax reform is pushed into 2018, will this endless equity melt-up get a winter chill? Companies mentioned on this podcast Activision Blizzard (ATVI) Amazon (AMZN) Apple (AAPL) Costco (COST) Facebook (FB) JC Penny (JCP) Kohl’s (KSS) Macy’s (M) Netflix (NFLX) PayPal (PYPL) Take-Two Interactive (TTWO) Target (TGT) Venmo (PYPL) Wal-Mart (WMT) Resources for this podcast: Chris Versace - @_ChrisVersace Lenore Hawkins - @EllesEconomy Tematica Research - https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting Cocktail Investing: Distilling Everyday Noise into Clear Investment Signals for Better Returns Books we’re currently reading: Versace: Pines Hawkins: Dark Matter
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In This Week's Cocktail Investing Podcast: Tematica Research's investing mixologists Chris Versace and Lenore Hawkins walk through the profound impacts of the forces responsible for our Connected Society investing theme. As the name implies, our world is becoming ever more interconnected as today we can instantly and near effortlessly interact with people on opposites sides of the earth. The increasing interconnectedness has completely changed the way we buy things, watch movies, listen to music, share memories, make new friends, look for love, sell our homes, research new things we want to buy and even do our homework. Amazon, for example, just added a new augmented reality feature to its iOS app that you can read about here. This interconnectedness also means that moments we wish we could erase from everyone’s memory instead can be relieved over and over again, such as this priceless moment. We live in a world in which nearly all that is known to mankind is available in the palm of one’s hand. Lenore and Chris talk about how the profound waves of innovation driving this interconnectedness have created headwinds that destroyed some of the most well-known global brands and tailwinds that have led companies that didn’t even exist 10 years ago to be international superstars. Along the way our mixologists talk about which companies are poised to prosper from the intersection of our Connected Society with the Cash-Strapped Consumer and Disruptive Technology and Safety and Security investing themes. They also discuss how the evolution of this theme is leading to the “datafication” of our lives and who is leading the charge. Companies mentioned on this podcast Alphabet (GOOGL) Amazon (AMZN) Apple (AAPL) Best Buy (BBY) Cisco (CSCO) Costco (COST) Dell Facebook (FB) Fedex (FDX) Fitbit (FIT) Garmin (GRMN) Home Depot (HD) Hudson Bay Company (HBAYF) Mastercard (MA) Netflix (NFLX) Paypal (PYPL) Staples Target (TGT) Twitter (TWTR) United Parcel Service (UPS) Venmo Visa (V) Wal-Mart (WMT) Resources for this podcast: Chris Versace - @_ChrisVersace Lenore Hawkins - @EllesEconomy Tematica Research - https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting Cocktail Investing: Distilling Everyday Noise into Clear Investment Signals for Better Returns Books we’re currently reading: Versace: Hawkins: Quantum Physics for Poets -
Download Episode This week, Tematica's investing mixologists Chris Versace and Lenore Hawkins do a deep dive on our Aging of the Population investing theme. The simple fact is both the U.S. and global population are skewing older and this dynamic has a number of ramifications for companies, some of which will ride that tailwind and cater to the emerging demand and pain points of an older population while others see their business hit a profound headwind. Lenore and Chris talk about these as well as discuss the larger headwinds this investment theme for economic growth to be had as the aging population continues to grow over the ensuing decades. Along the way, our mixologists talk about which companies are poised to prosper from the intersection of our Aging of the Population theme with our Connected Society, Cash-strapped Consumer and Disruptive Technology investing themes. And they even share the term “CamperForce,” something that has been of keen use to Amazon and is likely to be for Wal-Mart and others as they ramp their e-commerce businesses. Companies mentioned on this podcast Alphabet (GOOGL) Amazon (AMZN) Apple (AAPL) Charles Schwab (SCHW) Facebook (FB) Fitbit (FIT) LPL Financial (LPLA) Johnson & Johnson (JNJ) Sonos United Parcel Service (UPS) Wal-Mart (WMT) Resources for this podcast: Chris Versace - @_ChrisVersace Lenore Hawkins - @EllesEconomy Tematica Research - https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting Cocktail Investing: Distilling Everyday Noise into Clear Investment Signals for Better Returns Books we’re currently reading: Versace: The Obstacle is the Way Hawkins: Trespassing on Einstein’s Lawn
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Download Episode On this week's podcast, Tematica's investing mixologists Chris Versace and Lenore Hawkins breakdown the latest economic and market news and share what it means through Tematica’s thematic investing lens. As we move deeper into 3Q 2017 earnings season, results from IBM (IBM), General Electric (GE), Honeywell (HON) and others suggest we could be in for a rougher ride ahead compared to the Teflon market’s melt up over the last several weeks. Volatility remains depressed with the market at richer than rich valuations, and 3Q 2017 earnings could be the spark that leads the stock market to revert to the mean. That likely means the domestic stock market giving back some of its recent gains off the August lows. We also point out signals for our Connected Society, Cashless Consumption, Fattening of the Population, Food with Integrity and Safety & Security investing themes are paving the way for investable opportunities that are poised to become supercharged in the weeks and months ahead. We also review what we see happening in the markets and what the latest economic data reveals as well as share what we’ll be watching in the week ahead. Companies mentioned on this podcast Adobe Systems (ADBE) Alphabet (GOOGL) Amazon (AMZN) American Express (AXP) Apple (AAPL) Coca-Cola (KO) Comcast (CMCSA) Costco (COST) Disney (DIS) Facebook (FB) General Electric (GE) Honeywell (HON) IBM (IBM) Insulet (PODD) International Flavors & Fragrances (IFF) MasterCard (MA) Netflix (NFLX) PepsiCo (PEP) Proctor & Gamble (PG) SAP (SAP) Snap (SNAP) Twitter (TWTR) Visa (V) Resources for this podcast: Chris Versace - @_ChrisVersace Lenore Hawkins - @EllesEconomy Tematica Research - https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting Cocktail Investing: Distilling Everyday Noise into Clear Investment Signals for Better Returns Books we’re currently reading: Versace: The Industries of the Future Hawkins: Trespassing on Einstein’s Lawn
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Download Episode This week, Tematica's investing mixologists Chris Versace and Lenore Hawkins discuss some recent examples of the investing herd coming around to see what we’ve been talking about for quite some time with respect to companies such as Universal Display and Applied Materials. Last week we discussed the possibility that Amazon and Walmart could be the Coke and Pepsi of future mega-retailing. This week we give more of the rationale behind why retail-mageddon is about more than just the forces behind our Connected Society investing theme as the shrinking middle-class aspect of our Rise & Fall of the Middle Class and Cash Strapped Consumer themes are also having a major impact on malls across America. We also point out other areas in which our investing themes are intersecting, making for investable trends that can become supercharged. We also review what we see happening in the markets and what the latest economic data reveals. The record number of retail stores closing isn’t just about the impact of our Connected Society investing theme. Since 1996, 40% of the U.S. population has seen their inflation-adjusted incomes decline while an additional 20% have stayed roughly flat. Meanwhile, the cost of college tuition, childcare, and healthcare went up 200%, 125%, and 120%, respectively. America simply doesn’t have enough long-term care facilities to accommodate the needs of our aging society and 90% of seniors want to stay home – Disruptive Technology meets Aging of the Population inside the Connected Society - a triple play for our investing themes. Our Cashless Consumption investing theme continues to gain momentum, showing up in Shake Shack, with the addition of Apple Pay to Yelp and with the continued growth of digital banking. Our Connected Society also continues to wreak havoc with traditional content distribution and can been seen accelerating the impact of scandals ranging from the Hollywood earthquake around Harvey Weinstein to the mind-boggling fraud of Kobe Steel. In the markets, volatility continues to be elusive as those FAANG stocks keep outperforming. Just this morning Netflix shares surged past $200 for the first time. The infamous Buffet Indicator (The Wilshire 500 market cap versus U.S. GDP ratio) is today at 1.3 - just shy of the dotcom bubble peak of 1.36 and well above the 1.05 peak prior to the financial crisis bear market. Wednesday’s minutes from the latest Federal Reserve meeting reveal to us that a hike in December, may not be quite the done deal the market expects. Despite some an added post-hurricane boost, September retail sales disappointed, rising just 1.6% versus expectations for 1.7% while real average hourly earnings rose just 0.7% in September on a year-over-year basis and just 0.2% for production and nonsupervisory. With growth in spending outpacing earnings, no wonder this week Citigroup revealed that it is increasing its allowance for consumer loan losses much more than expected, so it comes as little-to-no surprise that growth in savings account balances is today at the lowest level we’ve seen since the depths of the recession. Companies mentioned on this podcast Alphabet (GOOGL) Amazon (AMZN) Apple (AAPL) Applied Materials (AMAT) Best Buy (BBY) Boeing (BA) Citigroup (C) Costco (COST) Credit Suisse (CS) Facebook (FB) Foot Locker (FL) Ford (F) Gap (GPS) General Motors (GM) JCPenny (JCP) JP Morgan (JPM) Kobe Steel (TYO) Kohl’s (KSS) Morgan Stanley (MS) Netflix (NFLX) Payless Radio Shack Sears (HLD) Time (TIME) Toyota Motors (TM) Shack Shack (SHAK) Universal Display (OLED) Wal-Mart (WMT) Resources for this podcast: Chris Versace - @_ChrisVersace Lenore Hawkins - @EllesEconomy Tematica Research - https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting Books we’re currently reading: Versace: MINDSET MATTERS MOST How to Create Success & Happiness by Releasing from the FEAR, LIMITATIONS & SELF-DOUBT Hawkins: Trespassing on Einstein’s Lawn
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As discussed in the recent episode of the Cocktail Investing Podcast, last week TechCrunch reported: Amazon has acquired Body Labs, a company with a stated aim of creating true-to-life 3D body models to support various b2b software applications — such as virtually trying on clothes or photorealistic avatars for gaming. Video demos on Body Labs’ website show its tech being used to augment a human with digital content as the person moves around by cladding them in a full-body gaming avatar ‘suit’ or adding boxing gloves and bunny slippers to a dancing man.Body Labs also says its “SOMA Shape API” can be used to “accurately predict and measure the 3D shape of your customers using just a single image”, suggesting this can power “custom apparel” or be used by fashion ecommerce retailers wanting to offer sizing recommendations.The company also suggests additional uses-cases for its ‘fat and all’ 3D body modeling tech in health and fitness tracking, and even equipment design and manufacturing. Full Article: Amazon has acquired 3D body model startup, Body Labs, for $50M-$70M | TechCrunch Tune in below for this quick excerpt from a recent episode of Cocktail Investing where Co-Hosts Chris Versace and Lenore Hawkins assess the impact of Amazon's acquisition and Chris challenges Lenore as to whether this could be the tipping point for Amazon to make significant inroads in apparel sales. Hint: there is one more piece of the puzzle Lenore thinks Amazon needs to add. Download Episode
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Download Episode This week, Tematica's investing mixologists Chris Versace and Lenore Hawkins discuss the impact of the twin hurricanes on the economic data coming in, with another potentially on the way, and the fallout from the horrific event in Las Vegas. Our Safety and Security investing theme takes front stage as Congress questions the former CEO of Equifax and the nation tries to cope with the pain and devastation caused by both Mother Nature and a single twisted soul in Nevada. As we head into the holiday shopping season, our Connected Society theme presents major headwinds to brick and mortar retailers, while those who “get it” in the online and mobile shopping sphere stand to capture even more market and wallet share. Chris and Lenore also debate Amazon and Walmart, the Pepsi and Coke of the future of retail? We also discuss some fascinating data trends, including why Wal-Mart is once again trotting out its layaway program this holiday shopping season. For those who want to see the charts as well as Lenore’s recap of the week that was, please go to our Weekly Wrap for the week, which can be found here. Our deepest respect for those individuals and companies lending aid to those suffering from the recent hurricanes such as: Royal Caribbean, who cancelled a cruise to use the ship to aid victims of Maria; Mark Cuban who used the Maverick’s team plane to deliver food, water and supplies to Puerto Rico; and Tesla, who shipped hundreds of Powerwalls to Puerto Rico to aid during the extended power outages. We discuss third quarter results for the U.S. stock market that blew the doors off expectations given September’s reputation for volatility and declines. The question is - will 2017 finish the year with the record for the smallest drawdown during the year for the S&P 500? Investor Intelligence bulls outnumber bears 3 to 1 and Market Vane bullish sentiment nears decade high. We dissect this Wall Street lingo and explain what this means for the markets going forward. Equity portfolio managers are sitting on record low levels of cash as margin debt continues to grow faster than market cap with volatility at prolonged, historic lows indicating there is just no more fear left. We discuss what this means for overall index level returns in the years to come. The ISM Manufacturing and Non-Manufacturing surveys for September painted one hell of a rosy picture but Markit’s reports contradicted. We explain why they differ so much and what this means for the economy. Inflationistas found fodder in the “prices paid” component of the ISM PMIs, but we think their conclusions are wrong. We dive deep into forecasts for the holiday shopping season, which companies are likely to be winners and which is facing strong headwinds as reflected by our Connected Society and Cash-Strapped Consumer investing themes. How does mobile shopping figure into these holiday forecasts and what do the Toy “R” Us bankruptcy and Star Wars mean for holiday toy sales? What’s the likely sleeper stocks to benefit this holiday shopping season? Chris and Lenore share their view and explain why. Over the coming week, we’ll be watching the NFIB Small Business report, the latest Federal Reserve minutes, Retails Sales for September along with how Business Inventories are adjusting as we head into the holiday season. Companies mentioned on this podcast Alix Partners Alphabet (GOOGL) Amazon (AMZN) Apple (AAPL) Best Buy (BBY) Body Labs Circuit City Cushman and Wakefield Deloitte & Touche Dick’s Sporting Goods (DKS) eMarketer Equifax (EFX) Hhgregg (HGGGQ) NetElixir Nike (NKE) Royal Caribbean Cruises (RCL) Sports Authority Sports Chalet Tesla (TSLA) Toys R Us Wal-Mart (WMT) Yahoo Resources for this podcast: Chris Versace – @_ChrisVersace Lenore Hawkins – @EllesEconomy Tematica Research – https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting
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Download Episode This week, Chief Investment Officer Chris Versace is joined by Tematica's "Man Behind the Curtain" Chris Broussard in a very special conversation with Brad Stertz, Director of Government Affairs at Audi. Our in-depth conversations with Brad puts some context and understanding around the issues and developments surrounding the self-driving car market as well as the far-reaching impact this revolution will have beyond just the automotive sector. Audi is at the center of Volkswagen's expertise for autonomous cars, an area it's been focused on for more than a decade, and Brad has been there for most of it. This Cocktail Investing podcast episode is another one of those conversations that takes you behind the scenes and puts you in the know on a topic that is filling headlines on a daily basis, with wide implications for a number of industries and investment themes. We discuss the evolution of autonomous vehicles, including several obvious and not so obvious tailwinds behind the evolution of this technology from dream to reality. Even we were somewhat surprised at the number of implications across several of our investment themes, including the Aging of the Population and Disruptive Technologies themes, but also Asset-Lite Business Models, the Cash-Strapped Consumer, Safety & Security and of course, the Connected Society as the impact on car ownership and usage, fleet management, delivery services and logistics is felt, as well as urban planning and the electric grid are forced to adapt. We also discuss several potential roadblocks, including state and local governments and interestingly enough privacy concerns over all the data that an autonomous vehicle will generate. Companies mentioned on this podcast Alphabet (GOOGL) Amazon (AMZN) AT&T (T) Avis Budget Group (CAR) Delphi Automotive (DLPH) FedEx (FDX) Ford (F) General Motors (GM) Hertz Global Holdings (HTZ) Intel (INTC) Lyft Motorola Solutions Inc (MSI) Nuance Communications (NUAN) Nvidia Corp (NVDA) QUALCOMM (QCOM) Tesla (TSLA) T-Mobile (TMUS) Uber United Parcel Service (UPS) Verizon (VZN) Volkswagen AG (VLKAY) Resources for this podcast: Chris Versace – @_ChrisVersace Lenore Hawkins – @EllesEconomy Brad Sterz — @BradSterz Tematica Research – https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting
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Download Episode This week, Tematica's investing mixologists Chris Versace and Lenore Hawkins face-palmed after learning the Securities Exchange Commission (SEC) has been compromised in a cyber-attack. This ironic breach mere days after Equifax broke the news on its breach… as we discuss, this increasing pain point that spills out of our Connected Society investing theme is fodder for our Safety & Security one. As our portfolio mixologists touch on that, they dish on the Fed’s latest missive coming out of its September monetary policy meeting and on a variety of data points for our Connected Society, Food with Integrity and Fattening of the Population investing themes. Chris and Lenore also mix in the latest economic data, and share why S&P 500 Global Ratings’ first rating cut to China’s sovereign credit rating in nearly two decades is important for investors. After last week’s not-too-special event, we share our view on why it’s so disappointing there are connectivity issues with the new Apple Watch model even before it begins to ship. As Apple tries to get itself back on track, Google is scooping up the team at smartphone company HTC that helped Google develop its Pixel phone. We share why Google is making this move and it’s got something to do with its core search business. Here’s a hint – it isn’t good news. Why is Post Holdings pivoting its business with the purchase of the packaged foods business at Bob Evans? Believe it or not, it’s all about the sausage! What do drones in Greece and being a neighbor of comedian Kathy Griffin have in common? The answer ties into one of our investing themes. Who’s hiring and who’s not hiring for the year-end holiday shopping season? Part of the answer ties to where people are shopping for toys that is part of our Connected Society theme. What’s the story behind Panera Bread CEO Ron Shaich challenging McDonald’s, Wendy’s and other fast food companies? The answer ties into our Food with Integrity investing theme and if you’ve seen the documentary Super Size Me you can guess where this is going. You can practically see Lenore roll her eyes at the response from McDonald’s. The Fed expects to hike interest four times before the end of 2018 as it embarks on selling securities on its QE bloated balance sheet, but its economic forecast calls for year over year declines in 2018 and 2019. As Chris and Lenore face-palm, they put some much-needed perspective on this, and explain the real reasons for the Fed’s actions. Over the coming week, we’ll be eyeing several key economic reports, including the Flash U.S. September PMI report, the August reports for Durable Orders and Personal Income & Spending. We’ll also be watching Hurricane Maria as we look to get a final tally on hurricane-related damage and what it means to 3Q 2017 GDP. Companies mentioned on this podcast Alphabet (GOOGL) Amazon (AMZN) Apple (AAPL) Bob Evans (BOBE) Burger King (QSR) Equifax (EFX) HTC KB Home (KBH) Kohl’s (KSS) Panera Bread (PNRA) Post Holdings (POST) Macy’s (M) McDonald’s (MCD) Nest Nordstrom (JWN) Target (TGT) Toys R Us United Natural Foods (UNFI) Wal-Mart (WMT) Wendy’s (WEN) Resources for this podcast: Chris Versace - @_ChrisVersace Lenore Hawkins - @EllesEconomy Tematica Research - https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting Program’s we’re currently streaming: Versace: Netflix’s Jerry Before Seinfeld Hawkins: Too much travel for any streaming, been reading “The Well-Tuned Brain” by Peter Whybrow, M.D.
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Download Episode In this special excerpt from Episode 33 of the Cocktail Investing Podcast, Lenore Hawkins discusses that while JPMorgan Chase CEO Jamie Dimon is likening Bitcoin to the Dutch tulip bulbs bubble in the 1600's, the reality is we are just in the early innings of cryptocurrencies. The question is, can Bitcoin maintain its pole position, or is its fate similar to that of many of the early internet pioneers? Tune into this quick primer on cryptocurrencies (just 6:30 in length) and its impact on our Cashless Consumption investment theme.
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Download Episode This week, Tematica's investing mixologists Chris Versace and Lenore Hawkins start off the podcast talking about one of the lamest presentations they’ve seen in a number of years. Yes, we’re talking about Apple’s September special event held on September 12th. Rather than spoil it for you here, all we’ll say is we knew the event was headed downhill fast when the first thing mentioned about the new iPhone was the pretty colors it would come in. We share our takeaways and insights for that event as well as for the latest economic data and thematic signals that are the backbone of our thematic investing lens. We share why we were nonplussed with Apple’s new iPhones and other product updates as well as its one true surprise to come – wireless charging. Essentially, we see these efforts as just shoring up Apple’s market position rather than breaking new ground. Looking at the Apple ecosystem, however, we see several companies that are poised to benefit from technologies being deployed in the new Apple Watch as well as the iPhone X. Chris shares his view on which companies are poised to benefit as these new products hit shelves in the coming weeks. Much like Apple’s shares that were climbing in anticipation of this week’s reveal, the overall stock market has continued to move higher despite growing number of warning signs. We shared several market unnerving items earlier in the week and now we’ve added Euro junk bond yields falling below that for U.S Treasuries to the list. Yep, you heard us right, and Lenore explains why this is important. With football season underway (that’s American football, Lenore), we’re already seeing broadcast viewership dropping like a bad fumble compared to last year. We explain how our Connected Society theme is at work, and what it means for broadcast networks as Facebook, Amazon and Google focus on content, including live sports. We’ve been vocal about the “death of the mall,” but team Tematica was pleasantly surprised by Nordstrom’s new strategy to leverage services to fend off Amazon and others. Listen to our take on what this means and some speculation on our part as to what may follow. Cryptocurrencies like Bitcoin are making headlines, but why is JPMorgan Chase CEO Jamie Dimon likening Bitcoin to tulip bulbs? Lenore digs into this and shares why we are just in the early innings of cryptocurrencies. The latest JOLTS provided ample confirmation for our Tooling & Retooling investment theme. Barring some trade and immigration reform, the report also signaled the speed of the domestic economy is likely capped. We explain why that is as well as why the August PPI reading isn’t helping the Fed meet its inflation target. Over the coming week, we’ll be eyeing several key economic reports, including August Retail Sales, as well as the Fed’s September FOMC meeting on September 20. We expect Hurricane Harvey to show some disruption in the August Retail Sales Report, but it’s the combined impact of Harvey and Irma that might have a more cautious tone coming out of the Fed next week. Companies mentioned on this podcast Alibaba (BABA) Alphabet (GOOGL) Amazon (AMZN) Apple (AAPL) Applied Materials (AMAT) AT&T (T) AXT Inc. (AXTI) Comcast (CMCSA) Costco Wholesale (COST) CVS Health (CVS) Equifax (EFX) Facebook (FB) Hulu JPMorgan Chase (JPM) Netflix (NFLX) Nordstrom (JWN) Qorvo (QRVO) Skyworks Solutions (SWKS) Universal Display (OLED) Resources for this podcast: Chris Versace - @_ChrisVersace Lenore Hawkins - @EllesEconomy Tematica Research - https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting Program’s we’re currently streaming: Versace: HBO’s Game of Thrones, Season 7 Hawkins: Netflix’s The Defenders
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Download Episode This week, Tematica's investing mixologists Chris Versace and Lenore Hawkins start off the podcast copping to the fact that, much to their chagrin, the summer is over, and it’s back to work. As they’ve pointed out to listeners, September is typically one of if not the most tumultuous months for stocks, and between both North Korea and Hurricane Harvey the month is certainly starting off rocking and rolling as CNNMoney’s Fear & Greed Index understandably sits firmly in “fear” territory. As we turn our thematic gaze forward, however, there is much more to be concerned about, as well as a number of confirming data points for Tematica’s 17 investment themes: On the heels of Hurricane Harvey, we now have Hurricane Irma barreling down on the Caribbean with its sights set on Florida. Irma has been upgraded to a Category 5 hurricane, and is widely believed to be one of the most powerful Atlantic hurricanes ever. Moreover, it’s looking to be followed by tropical storm Jose. Odds are this trifecta of back-to-back-to-back storms will hit the economy in a meaningful way, and we expect to see third-quarter GDP forecasts drop as effect of Irma and Jose wind down. The combination is also poised to result in a number of items falling into our Scarce Resource investment theme in the short-term while goosing demand for building and infrastructure materials as well as autos in the coming quarters. We’re already seeing the impact of this very active hurricane season as companies ranging from United Continental (CCL), Carnival Corp. (CCL), Royal Caribbean (RCL) and Norwegian Cruise Lines (NCLH) scuttle aircraft and ships due to dangerous weather conditions. We expect retail and restaurants, which have already borne the brunt of weakening traffic and sales even before Harvey, to be in for a rough ride as well. We discuss new reports from the Bureau of Labor Statistics and the Federal Reserve that confirm our Cash-Strapped Consumer theme, plus share what it means that Wal-Mart (WMT) is already offering its holiday layaway plan. Connected Society company Facebook (FB) is targeting Slack and Google (GOOGL) Hangouts as it looks to attack the enterprise messaging market with WhatsApp. The question we ask is how many messaging apps does a person need? Can our Connected Society get overly connected? We reveal the biggest factor taking a bite out of income growth over the last few years is all about what happens on Capitol Hill as Taxes and Health Insurance expenditures profoundly outpace income growth. That is just not a sustainable trend. There are two new IPOs being filed – Connected Society player Roku (ROKU) and Content is King contender Rovi – and, and Chris and Lenore share their views on potential challenges ahead for these two companies. Next week we not only have several key economic reports, including August Retail Sales, Industrial Production and closely watched inflation metrics, but also Apple’s (AAPL) unwrapping of its next iPhone and several other new products. Listen in to hear what to expect and what’s at stake. Companies mentioned on this podcast Alphabet (GOOGL) Amazon (AMZN) Apple (AAPL) Carnival Corp. (CCL) Costco Wholesale (COST) General Motors (GM) Netflix (NFLX) Norwegian Cruise Lines (NCLH) Roku (ROKU) Rovio Entertainment (ROVIO) Royal Caribbean (RCL) TD Ameritrade (AMTD) Twitter (TWTR) United Continental (UAL) Resources for this podcast: Chris Versace - @_ChrisVersace Lenore Hawkins - @EllesEconomy Tematica Research - https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting Books we’re currently reading: Versace: The Mind Illuminated Hawkins: Everybody Lies: Big Data, New Data, and What the Internet Can Tell Us About Who We Really Are
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Our hearts go out to all those affected by the devastation in Texas and Louisiana. The magnitude of this incredible storm is such that in this week's program, Tematica's investing mixologists, Chris Versace and Lenore Hawkins discuss the impact of Hurricane Harvey, how it relates to some of our investing Themes, as well as the week's economic data, and relevant political happenings. What we know? Hurricane Harvey is in a class of its own, having delivered the greatest amount of rain ever recorded in the lower 48 states from a single storm. One of the areas hardest hit has been Houston, the 4th largest city in the United States. What does it mean? The magnitude of the storm damage, which is still being tabulated, is looking to be the most expensive the nation has ever experienced. Enki Research, a group that calculates risks and costs of hurricanes, tsunamis, and other natural disasters, says the “middle-of-the-road” estimate for Harvey ranges from $48 to $75 billion, while Accuweather projected it to be around $190 billion. Why is this important? There are no two ways about it - GDP expectations near-term are going to get hit, just the way they were after Hurricane Katrina. We walk you through the whys and share what this likely means for any potential Fed rate hike come September, as well as the potential impact on the upcoming debt ceiling and tax reform debates. We cut through some of the talk in the media about how this will be an eventual boon to GDP and point out how this is another example of Frederick Bastiat’s parable of the broken window. You know you are dying to learn what that is all about! Among the industries that will feel the post-Harvey pain, are the already struggling restaurants and retailers. We share our take on what other areas are vulnerable and where investors can find opportunities as the flooding subsides and the conversation focuses on rebuilding Houston. For those looking to donate to the victims of Harvey, here are some options: Houston Food Bank Food Bank of Corpus Cristi Houston Humane Society Crowdfunding through YouCaring for Victims of Hurricane Harvey organized by Houston Texan Defensive End J. J. Watt Hurricane Harvey Relief Fund Texas Diaper Bank Before donating to any organization, please first check them out using Charity Navigator if you aren’t already familiar with them. Resources for this podcast: Chris Versace - @_ChrisVersace Lenore Hawkins - @EllesEconomy Tematica Research - https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting
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Download Episode Amid the 2Q 2017 earnings onslaught, Chris Versace, Tematica’s Chief Investment Officer, and Lenore Hawkins, Tematica’s Chief Macro Strategist, are combing through more than 600 earnings reports this week. With companies ranging from Amazon (AMZN), Facebook (FB), Alphabet (GOOGL), Lam Research (LRCX), PayPal (PYPL), MasterCard (MA) and Caterpillar (CAT) to name several, all reporting, there is no shortage of data points to be had. Rather than skip this week’s podcast, we’re sharing our recent Thematic Summit that we held for our institutional subscribers on June 28, 2017. These conference calls include a deeper look at the economy and markets, but in particular in-depth discussion on a number of things as they relate to the Tematica Select List. The Select List is our recommended list of stocks, ETF’s and mutual funds that have the strongest thematic tailwinds and the most upside potential at current market conditions. It's part of our Tematica Investing product, which you can read more about here. With positions in companies like Amplify Snacks (BETR), Universal Display (OLED), and CalAmp Corp. (CAMP) that significantly outperformed the market averages in 2017, we strongly suspect you’ll enjoy our thoughts on the Select List Enjoy today’s episode and we’ll be back next week with a brand new one that should be extra special as Chris will be in Singapore to keynote INVEST 2017 as well as teach a master class in thematic investing. Companies mentioned on the Podcast Alphabet (GOOGL) Amazon (AMZN) Amplify Snacks (BETR) Applied Materials (AMAT) CalAmp Corp. (CAMP) Costco Wholesale (COST) Facebook (FB) Universal Display (OLED) Resources for this podcast: Chris Versace - @_ChrisVersace Lenore Hawkins - @EllesEconomy Tematica Research - https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting
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Download Episode As the 2Q 2017 earnings onslaught continued this week, Chris Versace, Tematica’s Chief Investment Officer, made his way to Singapore to keynote INVESTFair 2017. In this week's episode, Chris catches up with Lenore Hawkins, Tematica’s Chief Macro Strategist, and shares his first-hand findings that Singapore is embracing Tematica’s Cashless Consumption investing theme. The two then talked about other notable developments with regard to Cashless Consumption as Microsoft’s (MSFT) Skype brings the ability to “send money” through its new partnership with PayPal (PYPL), and India’s Paytm targets Facebook (FB) as it morphs its payments platform to include messaging. Could riding the Connected Society and Cashless Consumption tailwinds make Paytm India’s answer to WeChat, which serves nearly one billion users in China? Rounding out our thematic conversation, we hear once again that body cameras aren’t always friendly to police officers… ah, how some forget what always on, always connected means. Last week we shared our Thematic Summit that wrapped 2Q 2017. In today’s episode, Lenore and Chris review the latest data that once again raises questions over the speed of the economy. Whether it’s a consumer that looks increasingly tapped out or credit card issuers that are raising their charge off rates, there are reasons to be concerned about the consumer’s ability to spend in the coming months. We also check in on weekly railcar traffic, which like ISM Service reading for July took a sharp tumble month over month, confirming the pain being felt by General Motors (GM), Ford Motor (F) and other automotive OEMs continues in the process. Finally, while the US stock market continues to inch its way higher, Lenore reveals there is a Donald Trump like yuuuge concentration in what’s been driving the market higher of late. Here’s a hint, if you don’t Apple (AAPL) or Boeing (BA), you’re probably lagging the market. Lenore also explains what’s going on with the dollar, and why the domestic stock market is underperforming on a relative basis. Enjoy today’s episode, and be back next week when we get more on Chris’s Singapore trip, including his experience with Amazon’s (AMZN) Prime Now, and hear all about Lenore’s appearances on Fox Business, a network that is now solidly kicking CNBC’s rear in the ratings. Companies Mentioned on the Podcast: Amazon (AMZN) Apple (AAPL) Boeing (BA) Facebook (FB) Ford Motor (F) General Motors (GM) MasterCard (MA) PayPal (PYPL) Resources for this Podcast: Chris Versace - @_ChrisVersace Lenore Hawkins - @EllesEconomy Tematica Research - https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting
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In this special excerpt from Episode 28 of the Cocktail Investing Podcast, hosts Chris Versace and Lenore Hawkins discuss what a unique approach by a panhandler tells us about the state of our Cashless Consumption investment theme and how it reflects the explosion of Mobile Payments across emerging markets.
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In this week's program, Tematica's investing mixologists, Chris Versace and Lenore Hawkins discuss the week's economic data, relevant political happenings and share where they have spotted a few of the latest Thematic Signals.
The Republicans’ plan to repeal and replace the Affordable Care Act has fallen flat, which calls into question the ability to pass the substantive tax reforms upon which market valuations have been based. The timing of tax reform legislation is looking like it will go head to head with not only when the Congressional Budget Office expects the federal government to hit the debt ceiling, but also during the height of 2017 election campaigning. We continue to see more data pointing to a slowing domestic economy even as the stock market continues to melt higher as we enter 2Q 2017 earnings season. Lenore explains why greater growth opportunities outside the US might offer more attractive returns for investors. Here at U.S. shores, what to make of new market highs amid stretched valuations and some funky business with the VIX. Our view on why Netflix’s belief that “negative free cash flow will be an indicator of enormous success” is worrisome, and why Amazon is likely to put serious pressure on Netflix’s ability to raise prices. Despite the focus by Apple and others on mobile payments and our Cashless Consumption thematic investment theme, Alibaba and Tencent are killing it in China where even panhandlers are using QR codes. NBC News snuggles up to Snapchat, but we share why Facebook’s latest moves continue to set it apart from other the social media platforms.Companies mentioned on the Podcast
Alibaba (BABA) Amazon (AMZN) American Express (AXP) Ameriprise Financial (AMP) Bank of America (BAC) Charles Schwab (SCHW) CSX (CSX) Facebook (FB) Harley Davidson (HOG) MasterCard Netflix NFLX) Snap (SNAP) Starbucks (SBUX) Stifel Financial (XXX) Tencent (TCHEY) Twitter (TWTR) United Parcel Service (UPS) Visa (V) Walt Disney (DIS) WW Grainger (GWW) Whole Foods Markets (WFM)Resources for this podcast:
Chris Versace - @_ChrisVersace Lenore Hawkins - @EllesEconomy Tematica Research - https://www.tematicaresearch.com Themes Report: https://www.tematicaresearch.com/whatisthematicinvesting - Show more
