In today’s briefing:
- Solvency Risk Short Candidates: Beyond Meat, Madison Sqr Garden, Trinity, Portillo, Jack in the Box
- Elon Is “Saving” Twitter To Death
- Wrapped Assets Under Scrutiny
- The Commodity Report #79
Solvency Risk Short Candidates: Beyond Meat, Madison Sqr Garden, Trinity, Portillo, Jack in the Box
- This model seeks companies facing dangerously high leverage coupled with negative or declining cash flows. It considers interest expense, capex and short term maturities for additional input.
- The companies may not be viable given cash flows and capital structures. These shorts tend to have higher betas and can have strong down moves as the crisis is recognized.
- This week we flag: Beyond Meat, Madison Sqr Garden, Trinity, Portillo, Jack in the Box
Elon Is “Saving” Twitter To Death
- New owner Elon Musk is blowing up Twitter in record time by driving away revenue, gutting headcount to levels unable to sustain the platform, and accelerating its legal jeopardy.
- With Twitter now hurling toward bankruptcy, it’s also running out of cash as well as places to get it.
- Too bad Elon also has already has caused hundreds of millions in losses for Twitter’s beleaguered bankers and his fellow equity buyers who he caused to “obviously” overpay.
Wrapped Assets Under Scrutiny
- Price Movements: The stETH discount worsened after a whale withdrew $100m ETH from Curve.
- Market Liquidity: BUSD’s market share of volume on centralized exchanges is approaching all time highs.
- Derivatives: The ratio of futures to spot volume has experienced a 5x drop, meaning fewer derivatives are being traded relative to spot.
The Commodity Report #79
- The world economy will be as weak next year as it was in 2009 after the financial crisis as the conflict in Ukraine risks becoming a “forever war,” the Institute of International Finance said.
- Global growth is expected to slow to 1.2% in 2023, according to the IIF.
- The slowdown will be led by Europe, which is impacted most by the war, according to the IIF.
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