by Michael Keane
A few things happened in the last couple of weeks in the IPO arena that strengthens the desire to having decentralized value more prominent. The not so wonderful feelings of fear and greed were (and are) currently present in the WeWork, Peloton, and Saudi Aramco IPO process and it hurt all three companies.
The closely guarded and deeply centralized IPO process did not work well. Conversations in the media like Sonali Basak from Bloomberg are picking up on this topic. First, the IPO of We Work was pulled with the drama of its financials and the CEO. The IPO of Peloton fell flat on its face. Some feel it got taken on the idea that the valuation is for a tech company. The government of Saudi Arabia is doing more than a few things not in its normal behavior in order to get the IPO of Saudi Aramco done. They seem to be rushing through to the IPO, ignoring the security issues as well as the stagnation and possible downward momentum in the price of oil.
One improvement may be the idea of the Dutch auction model that Google
used. It just seems that there is a better deal out there for investors
when it comes to IPO's. Firms not associated with the company going
public like Morningstar and other analyst firms can and likely should be
the driver behind how an IPO should be analyzed and sized up for
investors.
Possible investors in all three companies would be served better in its goals of investment with a more visible and transparent IPO process. Sometimes, it can be a bad combination when you have private company investors looking to profit from their investment by having an IPO and investment bankers hungry for that fee. Taken separately, both are fine. But together, the above mentioned issues show up on a regular basis. If a less biased look at the company can happen, new investors, the company, and the market will be better served.
Good luck in all your trading and investing matters!
**All
posts on this blog are information and opinions only. They are not to
be considered recommendations to buy or sell any security. Please do
your due diligence first before trading and investing. Please direct all
questions and comments to the blog, kdkfund@gmail.com, or on
twitter @kdkfund.
Sunday, September 29, 2019
Tuesday, July 30, 2019
Rate Cuts Are For Buybacks
by Michael Keane
In an earlier story (link here), our partner KeaneVCC documented how corporations used the tax cut to buyback their shares. The biggest beneficiaries of this process were the executives as bonuses are regularly tied to stock prices. We like to call this process the executive bonus protection plan based on the idea of higher stock prices equal higher bonuses.
Now that it is shown that the tax cuts didn't do enough for those outside the executive area, they are gunning for rate cuts.The lower cost of borrowing is needed to continue to buyback shares at a profitable level for corporations.
A cnbc.com article (here) on the topic from Jeff Cox addresses this exact issue. Bloomberg TV also spoke about this topic with David Levovitz from JP Morgan Asset Management.
This is a warning sign for the economy. Be careful out there.
**All posts on this blog are information and opinions only. They are not to be considered recommendations to buy or sell any security. Please do your due diligence first before trading and investing. Please direct all questions and comments to the blog, kdkfund@gmail.com, or on twitter @kdkfund.
In an earlier story (link here), our partner KeaneVCC documented how corporations used the tax cut to buyback their shares. The biggest beneficiaries of this process were the executives as bonuses are regularly tied to stock prices. We like to call this process the executive bonus protection plan based on the idea of higher stock prices equal higher bonuses.
Now that it is shown that the tax cuts didn't do enough for those outside the executive area, they are gunning for rate cuts.The lower cost of borrowing is needed to continue to buyback shares at a profitable level for corporations.
A cnbc.com article (here) on the topic from Jeff Cox addresses this exact issue. Bloomberg TV also spoke about this topic with David Levovitz from JP Morgan Asset Management.
This is a warning sign for the economy. Be careful out there.
**All posts on this blog are information and opinions only. They are not to be considered recommendations to buy or sell any security. Please do your due diligence first before trading and investing. Please direct all questions and comments to the blog, kdkfund@gmail.com, or on twitter @kdkfund.
Thursday, July 11, 2019
Invest in Blockchain Now
by Michael Keane
There are many reasons to investigate an investment into the cryptocurrency area. The testimony by Federal Reserve Chairman Powell to Congress over the last 2 days is another strong indicator. Normally, these hearings are regularly noise. But in this case, the testimony related to cryptocurrency was likely a signal.
Together with arguably every member of Congress, Chairman Powell expressed worry and a strong desire get ahead of cryptocurrency and to limit its effect on the global monetary system. You can find the unfiltered testimony here. Every member of government was in agreement. They even mentioned Facebook multiple times during the testimony. That rarely happens. This should tell you that there is recognition that cryptocurrency is being recognized in a serious manner.
This testimony also should bring back the "fraud" comment from JP Morgan CEO Jamie Dimon about cryptocurrency 18 months ago. But 6 months ago, JP Morgan released news that they have built their own coin and have a large development team doing work. The fraud comment was clearly a stall tactic. I believe Congress and Central Banks around the world are in the same delay "fraud" moment and that they are busy building their teams to handle their responsibilities in the crypto arena. It is interesting that during the testimony, JP Morgan's coin rarely if ever came up. That was not a mistake or oversight.
Some say this testimony is troublesome for cryptocurrency. It actually is the exact opposite. Legitimacy continues to strengthen. Regulation is needed. Now it is up to the cryptocurrency group to assist in helping to build the infrastructure that answers governmental questions and shows its promise to the community. A recent comment from author and blockchain investor Don Tapscott, related the development of blockchain to the development of the internet around 1995.
Some areas to investigate are chips, platform companies, and software. Per disclosure, KDK Fund does not currently have an investment in the space. Our partner, KDK Options, has an order for Nvidia call options that is not yet filled.
**All posts on this blog are information and opinions only. They are not to be considered recommendations to buy or sell any security. Please do your due diligence first before trading and investing. Please direct all questions and comments to the blog, kdkfund@gmail.com, or on twitter @kdkfund.
There are many reasons to investigate an investment into the cryptocurrency area. The testimony by Federal Reserve Chairman Powell to Congress over the last 2 days is another strong indicator. Normally, these hearings are regularly noise. But in this case, the testimony related to cryptocurrency was likely a signal.
Together with arguably every member of Congress, Chairman Powell expressed worry and a strong desire get ahead of cryptocurrency and to limit its effect on the global monetary system. You can find the unfiltered testimony here. Every member of government was in agreement. They even mentioned Facebook multiple times during the testimony. That rarely happens. This should tell you that there is recognition that cryptocurrency is being recognized in a serious manner.
This testimony also should bring back the "fraud" comment from JP Morgan CEO Jamie Dimon about cryptocurrency 18 months ago. But 6 months ago, JP Morgan released news that they have built their own coin and have a large development team doing work. The fraud comment was clearly a stall tactic. I believe Congress and Central Banks around the world are in the same delay "fraud" moment and that they are busy building their teams to handle their responsibilities in the crypto arena. It is interesting that during the testimony, JP Morgan's coin rarely if ever came up. That was not a mistake or oversight.
Some say this testimony is troublesome for cryptocurrency. It actually is the exact opposite. Legitimacy continues to strengthen. Regulation is needed. Now it is up to the cryptocurrency group to assist in helping to build the infrastructure that answers governmental questions and shows its promise to the community. A recent comment from author and blockchain investor Don Tapscott, related the development of blockchain to the development of the internet around 1995.
Some areas to investigate are chips, platform companies, and software. Per disclosure, KDK Fund does not currently have an investment in the space. Our partner, KDK Options, has an order for Nvidia call options that is not yet filled.
**All posts on this blog are information and opinions only. They are not to be considered recommendations to buy or sell any security. Please do your due diligence first before trading and investing. Please direct all questions and comments to the blog, kdkfund@gmail.com, or on twitter @kdkfund.
Subscribe to:
Posts (Atom)