The R Word

Estimated read time: 6 minutes

GM... say it back

Email agenda:

1. Startup chop block + ?

2. James Bond(s) & Bitcoin

3. DIS-Inflation

Startup Land

1 Tweet That Sums It Up

As each week passes, it seems like more and more startups are starting layoffs

I hate this part of the economic cycle, the slowing GDP growth/recession part

Ro is not alone. Here are some other companies with significant layoffs:

• MasterClass laid off 156 people (20% of workforce)

• Coinbase laid off 1,100 people (18% of workforce)

• SuperHuman laid off 23 people (22% of workforce)

I wrote about this on Twitter

Companies (startups AND fortune 500s) NEED to be macro aware

They need to spend more time understanding market cycles and how to properly plan for times like these

This was one of the main reasons I started this newsletter

I want to be the data-driven, investing, macro aware newsletter that helps startups and working professionals avoid getting royally f***ed (a French term), by economic gravity

Question

Should a startup with plans to hire 100 people hire 30-40 insanely high performers and pay crazy comp rather than paying market or below market to 100 people?

James Bond(s) Live to Die Another (To)day

Meme of the week

If sucking as much as possible was a competition

Bitcoin vs Bonds would be the next Floyd Mayweather vs Pacquiao PPV

One of the most common portfolio’s is the 60/40 portfolio

60% stocks and 40% bonds

Made famous by John Bogle, who founded Vanguard

We have no political affiliations here but this meme is too perfect to not use

The 60/40 portfolio

When stocks started to perform poorly around COVID, my friends Mom asked me “should we be in bonds??”

This is a common misconception: Stocks are doing bad, so I should buy bonds

Bonds are "SAFE"

BUT

Over the past 100 years, stocks and bonds have more often been correlated (move in the same direction) than inversely correlated (moving opposite)

99% of investors don't know that

So you could have a case where you think your 40% bonds will do well when your 60% stocks are sucking, but instead they both suck together

Based on our math based signal: Bonds AND Bitcoin both are not "bottoming" or are investable yet

Inflation Rolling Over

This past summer, all everyone has talked about is inflation

Gas prices, food prices, medicine prices and for good reason

The cost of living is going up and for many people this SEVERELY impacts their well-being

The data shows inflation may be starting to turn:

Oil is down 11.4% from it's cycle high in the past month

Natural Gas is down 29.6% from it's cycle high in the past month

XLE (Energy ETF) is down 22% from it's cycle high in the past month

The central banks, through raising int rates, are starting to achieve their goal: Slow inflation

Here's a ticker we are buyers of: $PFIX

This ticker is an interest rate hedge (performs well during rising interest rates) aka now

The economic data in CHY-NA also does NOT look like the US economic data

We are buyers of: $KWEB

That is all for this week.

- DOB

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.