Back in late March Lyft made their debut on the stock exchanged and opened at $72 per share. Lyft is now down 18% since its IPO. Despite the positive earnings last week, which included raising their full-year outlook, Lyft has further downside. There have been countless questions and discussions surrounding Lyft’s business model.
In fiscal 2019, Lyft expects to generate revenue of at least $3.47 billion with an adjusted EBITDA loss of $850 million to $875 million. In 2018, Lyft’s EBITDA’s loss was around $850 million. Thus, Lyft may never make a profit, nor do they have a clear path to profitability.
But here is why I think Lyft is a short now. During their earnings announcement last week, where they reported raised their full-year outlook, Lyft said they are cutting down their lock-out period from late Sept. to Aug 19th.
“The lock-up period is scheduled to end on September 24, 2019, which falls within the Company’s quarterly blackout period that commences at the end of the day on August 31, 2019,” the company said in the filing. “Therefore, in accordance with the lock-up agreements with the underwriters, the lock-up period will end at the open of trading on August 19, 2019, which is ten trading days prior to the commencement of the Company’s quarterly blackout period. The Company will also release the market standoff agreements when the lock-up period expires.”
Lyft expects that about 257.6 million shares of Class A common stock may become eligible for sale in the public market beginning August 19. This includes about 12.8 million of Class B shares of common stock converted into Class A stock.
Newly public companies are typically subject to a lock-up period preventing insiders including founders, directors and other employees from selling their shares for a designated period of time. The restriction is intended in large part to prevent these investors from injecting large numbers of shares into the market, which could send stock prices lower by quickly increasing supply.
So there are about 274 million shares outstanding. The founders, institutions that bought a stake in the company before going public want to cash out. We are talking about potentially diluting the float (float is the number of shares actually available for trading) by almost 100%.
August 19th simply becomes a supply and demand issues, very similar to the supply and demand issues on Steem. It’s way too expensive to short the stock by borrowing shares due to the borrowing rates, which was once 100%. Thus, the best way to short Lyft is through options. But give yourself so time for the trade to work. The leap options, January 2012 options are too illiquid. But the January 2020 put options gives one plenty of time for the trade to work, which also includes time for an additional two earnings report (which may not meet expectations).
So if you think Lyft will at least test the lows within the next five months,
Consider buying some January 2020 put options with a strike price at $50, but first ensure its liquid enough.
This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.
As climate change related risks are becoming more pronounced, major investment firms have been increasingly pushing companies to address these risks and their role in exacerbating them.
This year, almost every major public oil company faced at least one shareholder resolution involving climate change, with proposals winning record support.
While most asset managers prefer engagement to divestment, frustration over fruitless discussion and resolutions has also led to a growing divestment campaign.
Earlier this year, Legal & General Investment Management (LGIM) reduced its stake in oil giant Exxon by US$300m, using its remaining stake to vote against the reappointment Chairman and Chief Executive Officer Darren Woods.
Analysis and Comments
The whole debate around divestment vs engagement is a potentially divisive one – not so much among asset managers but in discussions with asset owners and particularly retail investors.
Over the last few years, it has been interesting to watch the shift in focus, as the engagers have increasingly honed in on the stranded asset risk across a whole range of industries, which has real and tangible implications for value.
Google announced beginning of the week that it would neutralize carbon emissions from delivering consumer hardware by 2020, and include recycled plastics in each of its products by 2022.
According to Anna Meegan, the company’s head of sustainability for its devices and services unit, the company’s transport-related carbon emissions per unit fell 40% in 2018 as it increased the use of ships rather than planes in transport.
Currently three out of nine products for which the company discloses details online contain recycled plastic (ranging from 20-42%) – which trails behind hardware rival Apple’s sustainability efforts.
Analysis and Comments
The trend may be slow, but for those companies that sell high profile products such as Apple & Google, the pressure to show their green credentials appears to be growing.
It is not clear how Google will fully “neutralise carbon emissions from delivery” – initially it looks as if at least part of the solution will be via carbon credits (which will gradually become more & more expensive to buy).
Hence longer term, this increase in carbon crédits price could be providing an incentive for the transport sector to accelerate its own shift to low carbon.
British spirits maker Diageo is investing £180m into green energy and water recoverysolutions such as biomass boilers, solar installations and water recycling systems at 11 of its breweries across Africa.
The investment is the company’s largest environmental investment in a decade, and will include £50m in upfront capitalfor solar, water treatment and biomass equipment, as well as£130m in long-term supply and maintenance contracts.
The company’s ultimate goal is to become 100% green and it plans to half its water usage and GHG emissions by 2020 as part of a group-wide commitment. It is also increasing its focus on sourcing locally in, with 78% of agricultural materials used in its 12 breweries across Africa currently sourced from local farmers.
Analysis and Comments
Africa contributes c. 13% of Diageo’s global turnover and about half of the company’s beer sales, and a minimum of 20 of the company’s African production facilities are in so-called “water-stressed locations”.
Unsurprisingly, water is an essential ingredient in all of Diageo’s brands (90%+ of beer and 60% of spirits) and the company has thus far been able to achieve a c.44% improvement in water efficiency between 2009 and 2018.
According to new data from WRI’s Aqueduct tools, 17 countries (including Africa) – home to one quarter of the world’s population –face extremely high levels of baseline water stress, as water withdrawals globally have more than doubled since the 1960s.
Of the 17 most water-stressed countries,12 are in the Middle East and North Africa (MENA), where growing demand and climate change are pushing already constrained countries even further into extreme stress.
According to the World Bank, this region has the greatest expected economic losses from climate-related water scarcity (c. 6-14% of GDP by 2050), stressing the importance of pursuing SDG 6 – ensuring the availability and sustainable management of water and sanitation for all.
This is a question which I am asking myself with increasing frequency, especially since the start of Q3 2019.
When I first started investing in crypto, I thought that I knew the answer: more than about 2% of your portfolio value in crypto is a bad idea.
I have been an adherent of the ” invest 1% of your net worth in crypto” principle. It makes sense: you’re putting in an affordable amount, an amount that you can lose without significantly disadvantaging your life, and an amount that is enough to significantly grow your wealth if BTC really takes off.
But now I am doubting that logic.
Reality has been hitting uncomfortably close to home this month. My portfolio value is growing, but only in my local currency.
I like a diverse portfolio, and mine is fairly diverse, but still rather traditional in construction. Over 50% of my investments are still sitting in an array of high-yield local fiat vehicles. 20 years ago this would have been a recipe for success – it’s most certainly how I was taught and what I was always advised to do. In fact, it’s still what financial advisers would recommend. The last time I consulted and invested through a finance professional was less than a year ago, and that’s still very much the tune that he was singing.
Perhaps because I am from Generation X it’s hard for me to think outside those terms. To me a cushion of growing fiat money still represents “safety”. I imagine that it’s possibly easier for younger people to think outside the traditional box in this regard, though the mainstream advice which they would be getting is probably much the same as what I get.
My crypto holdings have gained value this year (despite the bad altcoin market), my shares (which I streamlined mainly towards precious metals over the course of the last year) have done excellently and my physical precious metals holdings are finally waking up and making me money. Thanks to those, and some growth of my fiat, I have seen rapid growth of my wealth – but mainly in local terms. The sad truth is that with so much value in fiat, I am struggling to gain value in USD at all. As fast as I gain value in crypto and metals, my fiat depreciates against the dollar, and because I have most of my wealth in fiat, even a small depreciation costs me a lot.
I’ve grown my wealth by 20% in the last 6 months – in local currency, but only by 10% in USD. I know that sounds good (hell, most pro investors would kill for that), but I’m not happy with it, and here’s why:
Sitting with so much fiat I am very exposed to market fluctuations based on the political and economic situation of my home country and of the world in general. Two weeks ago my 10% USD gain was a 15% gain. I lost about 5% of my entire portfolio value (in USD) within two weeks – DESPITE climbs in crypto and precious metals. That’s a scary reminder of just how fast my portfolio can devalue. It also shows how the more volatile assets like crypto are not alone in their power to rapidly eat into the value of your portfolio when they turn bearish.
There is another consideration: The general trend of precious metals prices is an upwards one: they increase in value against USD. The general trend of my local currency is the exact opposite. Normally this doesn’t matter too much, as the interest I can gain on fiat holdings negates their devaluation and still makes me a small profit, but this is no longer the case.
At this stage you may wonder: “why not just transfer your fiat holdings into USD then?” Well, it’s inconvenient and a little costly to do so. I still need fiat for my daily transactions, so I still need a local fiat buffer. But the real reason is that USD doesn’t look healthy in the long-term either.
As many of us have been predicting for some time now, the economic house of cards that the world is built upon has become exceptionally fragile. It’s precariously balanced on a base made up of a trade war, a weakening and splitting European economic bloc, negative interest rates, quantitative easing and lending rate cuts, spiralling national debt which dwarfs GDP, and derivatives, derivatives and more derivatives. Options, futures, funds, shorts – everything BUT the underlying assets. The financial world is dealing in so many assets with zero inherent value, that the underlying assets themselves no longer even feature! And they have the gall to criticise crypto for having “no inherent value”… (which I can prove is false)
The collapse of fiat structures is looking uncomfortable close, closer and possibly more severe than I even had imagined. At this stage I doubt that this will be the end of fiat as we know it. Unfortunately, this is all happening a little too early for crypto to just step in and pick up the slack, crypto adoption has not yet reached that level of mainstream use and trust. This means that fiat will rise again and that it will probably only be after the following big crash that crypto picks up the slack.
However…
It’s not to say that that following big crash won’t happen soon after the one which is about to happen. It’s hardly been a decade since the last semi-decent sized market crash. With another one already on the cards, it is clear that the entire shaky system is just rebuilding itself on its former ruins each time – thereby creating an increasingly shaky base – and consequently guaranteeing that each successive crash will not be too far off. In addition to this, each crash of fiat, its related markets and its plethora of derivative assets is another boost for cryptocurrencies.
Even mainstream investors can now see that Bitcoin is fast becoming a replacement for Gold, or at least an alternative to it. This is not to say that Bitcoin won’t dip in price when markets crash, but like most BTC dips, that will be a temporary one – a desperate rush out of stored value in order to try to prop up the failing fiat-based assets. It’s ludicrously stupid and doomed to fail, but it happens; just take a look at what happened to the prices of precious metals in 2008: Gold lost 30% of its value, Silver lost 60%, Platinum lost 67%. Admittedly most bounced back within a year – faster and harder than the stock markets did.
Don’t get me wrong, I still support investing in Gold (and other precious metals). My macroeconomic opinion of the 2008 crash was that it was more a correction than a crash. The problem with such a correction is that it delays the inevitable: the BIG crash will still happen – only now it’s going to be even more severe when it does. As I said earlier, I don’t know if what we’re seeing now is the start of such a crash, or perhaps just another mini-crash/correction.
Either way, I’m scared to still have so much money sitting in fiat. It’s only a matter of time before the American markets give that one big sneeze – the one from which all other markets will catch a cold – or perhaps a disease far more serious. Looking at my portfolio now, I can’t help but think that the assets which are generally seen as “risky” today, are probably more “safe”. For crypto this is still tricky to say: as much as I love crypto, I’m hesitant to throw more than the recommended 1% into it, 2% maximum. Thanks to the growth of crypto, I’m already way past that mark, I’m now well into the 20% territory. Is that too much, or is it not enough?
Precious metals are a little easier, especially Gold. The chance of Gold losing its millennia old store-of-value status is practically zero. For this reason I will probably increase my holdings in precious metals and decrease those in fiat. Simultaneously I will look to increase my crypto holdings by a similar amount. Yes, crypto remains risky, but is it really riskier than fiat?
In a world of inflationary assets, only those with finite supply can be considered consistent long-term stores of value. I’m not a trader, so I’m not after short-term gains or volatile markets, I’m after long-term growth. For now it looks as if precious metals and crypto offer me the best chances of that; not only good returns, but also relative safety compared to fiat – as unconventional as that may sound and as contrary as it may be to my education in such matters.
At this stage it’s worth asking the question: “What about property?” I think that’s a valid question, but I don’t believe that it is the answer to my dilemma. In times of plenty (as we have enjoyed for the last decade), property is one of the things which balloons in value. I watched the price of my own home race upwards pre-2008, then I watched the market pop and the value of my house stagnated for about a decade. Only in the last two or three years has it suddenly climbed again. Remember that the 2008 crash is largely blamed on factors including the unsustainable property price bubble. Already I can see that property prices are suffering in my area. Houses which are for sale just don’t sell, sellers are slashing prices by large two-digit percentages. Rental properties stand open as people rather downgrade their lifestyles than pay such exorbitant prices. The housing market is in trouble – itself an indication that the next crash is already actually underway.
Property IS limited. There will always be demand for it, thanks to a growing human population. BUT it is overvalued, and a price crash will probably be rather severe. It takes a long time for property prices to recover from a crash – people don’t emerge from a depression with a wad of cash to splurge on an expensive house. I would rather not be in property during such an event. For the nimble trader with cash at hand, a few great property deals should become available at the worst point of the crash – but that’s beyond the scope of this post.
So what now?
Truth be told, I was on the verge of shifting money out of fiat two weeks ago. Unfortunately for me, I was a few days too late. I watched helplessly as Bitcoin roared back into quintiple digits territory, Gold shot to new 6-year highs and my local currency dropped like a stone – all simultaneously of course.
This leaves me in the old catch-22 situation: buy high or wait for a dip that may never come?
To make things even worse, Bitcoin is riding a very non-committal path along the top of my diagonal Fib retracement levels. It’s giving no clear indication of whether it will drop again (as I hope it will), or it it will shoot off to a new 2019 high.
Made by Bit Brain with TradingView
Looking carefully at the market, I would say that exceptionally poor altcoin sentiment may well indicate that crypto sentiment as a whole is poor and that BTC should drop lower. Conversely, the global fiat fears could kick BTC higher and ignite a bull run at any time. I’m leaning slightly towards there being another dip. The little dashed line you see on the chart is an alert which I have set at $9350, my current buy price (subject to change). Whether we will reach that mark or not, I do not know. Perhaps BTC will reach it and drop far lower – in which case I will probably buy like a maniac. For now I consider my previous BTC post to still be valid – so I still think that I can get my BTC dip.
Once I do buy, whether low or high, I will probably convert a fair amount of my BTC into altcoins (diversified altcoins). I’m a firm believer in buying when there is blood in the streets. As a value investor, altcoins look like a great buying opportunity to me now, possibly the greatest buying opportunity I’ve ever seen. To hedge this bet I will probably leave about 50% of what I buy in BTC. BTC may not grow like the alts when things are going well, but it is the most secure and durable of the cryptocurrencies, and it will weather any further price drops better than what the altcoins will. With BTC dominance at over 68%, I can’t see altcoins getting left behind for much longer- hence I am keen to get money into them NOW! This CoinGecko “Top 100 coins” chart illustrates the extent of BTC dominance:
From https://www.coingecko.com/en/global_charts
Where I come from we call that “unsustainable”. Sorry BTC maximalists – your coin is great – but so are many altcoins.
Similarly, when it comes to buying metals, I may look at alternatives to Gold. Like with BTC, I will put more into Gold than the other metals, but I almost certainly buy more of the higher ROI potential Silver and/or Platinum. Much of that also depends on how close to spot price I can get on each asset, and also on some local laws and regulations which affect precious metals trading, especially the taxation thereon.
Conclusion
As you can see, this most was mainly just me thinking out loud. I apologise if there is no specific actionable information and if it is more opinion than fact or hard analysis. Also, much of it is specific to my situation. However, I believe that parts of this post will pertain to most if not all of you, and that you should be asking yourselves similar questions and have similar concerns. I have no doubt that we shall still see large financial changes, call them “upsets” within our lifetimes. We will probably see a few such events. I believe that the scarce resources such as Bitcoin, Gold and property are good assets to hold for the long-term, depending greatly on local conditions and on when you buy them. It is now my immediate goal to increase my scarce asset holdings and decrease my fiat holdings as soon as I can. If a dip does not come soon, then I will be forced to start DCAing into such assets at higher prices.
The world has changed and fiat is no longer the safe asset it once was. The rate of this change is surprising even to me – a staunch anti-fiat campaigner. I am acting accordingly. I suggest you seek qualified advice in doing something along similar lines.
Yours in anything that isn’t fiat-based Bit Brain
“The secret to success: find out where people are going and get there first”
~ Mark Twain
“Crypto does not require institutional investment to succeed; institutions require crypto investments to remain successful”
The People’s Bank of China is “close” to issuing its own cryptocurrency, according to a senior official.
The bank’s researchers have been working intensively since last year to develop systems, and the cryptocurrency is “close to being out,” Mu Changchun, deputy director of the PBOC’s payments department, said at an event held by China Finance 40 Forum over the weekend in Yichun, Heilongjiang. He didn’t give specifics on the timing.
Mu repeated the PBOC’s intention that the digital currency would replace M0, or cash in circulation, rather than M2, which would generate credit and impact monetary policy. The digital currency would also support the yuan’s circulation and internationalization, he said.
The number of publishers using the blockchain-based decentralized browser Brave has increased by 1,200% over the past year, industry-focused news outlet Decrypt reported on Aug. 11.
According to data from BATGrowth — a website that monitors Brave browser adoption — the number of Brave Rewards publishers were 18,931 in July, 2018, while its current number is more than 230,000 at press time.
29,278 website publishers including the Washington Post and Smithsonian Magazine, 17,417 Twitter publishers, 2,917 Reddit publishers, 166,698 YouTube publishers and over 12,000 Twitch publishers use the Brave Reward program.
Earlier in August, Brave announced a feature for tipping content creators on Twitter with its native Basic Attention Tokens (BAT). The announcement also listed a number of features associated with the tipping service, including setting up regularly recurring tips as well as a mechanism for tweeting at a tipped creator to tell them how to claim their donation.
Newly-launched cryptocurrency exchange Beaxy has suspended trading after some users deliberately crashed the price of altcoin Ripple (XRP).
XRP/BTC dips 40%
According to a blog post and social media messages, beginning on Aug. 12, Beaxy experienced a sudden surge in XRP trading volumes, with a huge sell-off reducing XRP/BTC to 40% of its price on other exchanges.
“As a result and precaution, we are temporarily halting all trading activity and withdrawals across the exchange as we investigate,” the blog post reads.
The Binance-owned digital currency wallet, Trust Wallet, has released a desktop application for macOS.
The team behind Trust Wallet announced the development in a tweet today, Aug. 12, also revealing that the wallet will be available in the Mac App Store shortly.
In a series of tweets, Trust Wallet founder Viktor Radchenko disclosed that support for Linux will be launched next week. Radchenko further said that the main challenge for the team now is to port Trust Wallet to Windows, which they have ostensibly not done yet. Radchenko also noted that most desktop crypto users — around 75% — are on Windows.
“International Conference on Block Chain & Data Science” in Tokyo, Japan from August 14-15.
STEEM Trading Update by my friend @cryptopassion
Here is the chart of yersterday :
Here is the current chart :
Today the STEEM still progressed in the direction of the resistance line around 0.21$ but we have been rejected after a touch on the pink mobile line (MMA50). When this mobile line is broken, it means that the trend is reset. The fact that we didn’t break it now can be considered that we are still in bearish trend at short term, even with the last bounce. SO let’s see if we will finish to break it or if the drop will come back.
Bitcoin Perfect Storm?! Last Time PUMPED 237%!!! What’s REALLY Driving $BTC Price?!
BREAKING: Global BITCOIN Hysteria!!! $15k TARGET!? S. Korea & USA BULLISH AF!
JP Morgan – Dollar Doomed! Time to Buy Bitcoin! + SEC SHOCK Announcement!
Bitcoin Setting Up For A MASSIVE BULL RUN That Will Make 2017 Look Like A MoleHill
This Will Change Your Mind On Bitcoin. MASSIVE Amounts of Money Pouring In!
The Most Scary and Important Chart You NEED to See Right Now
Enjoy that? Me neither – this unfortunately is ‘the standard’ for current crypto news feeds particularly anything on YouTube. All the above titles date from last week and are all from sources I generally respect and find utility from (each has tens of thousands of subscribers). Lower down the crypto foodchain -hyperbole, fantasy, and flat-out lies dominate.
I have yet to see a piece of writing, political or non-political, that does not have a slant. All writing slants the way a writer leans, and no man is born perpendicular. ― E.B. White
A perspective is inevitable but ‘OMG the End of Banking!’ is more demagoguery than argument.
What’s in a Title?
Well, it matters because step by step such hyperbolic titling wears down your natural skepticim feeding a bias…that little by little brings you into the realm of the unreal fantasist’ – CRYPTO SET TO CONQUER THE WORLD! Who knows perhaps it will but we’re looking at a process of decades, not months or years.
The catch-22 is that only a minority of content creators rise above this misleading nonsense. In the pursuit of viewers/readers/followers measured engagement is swapped for CAPS !!!! HUGE / AMAZING adjectives and a couple of .
This is low low brow stuff akin to girly mag newspapers such as The Sun. Do you trust the Sun?
It’s no doubt partly a symptom of the youthful/wild-west quality of the crypto landscape. Nonetheless, for new investors it is a minefield of irrational exuberance backed-up only by the written/spoken word – there’s very little behind most of this nonsense. A kernel of truth – sure but enough to be basing investment decisions on…..?
The more engaged you are with crypto the greater the struggle to remain grounded and focused on market principles and project fundamentals. Ironically most of the people responsible for this gutter level material loudly denounce the establishment, mainstream media, politicians and so on for ‘misleading’ the common man…
If these folks are willing to mislead you in the title -why trust anything they write/record/post at all?
Hopefully, as the space matures so too will the news feeds but I’m not holding my breath!
