Surf Report: Lifting while we climb.
Issue 16: 01.17.2021 (Free Version)
INTRODUCTION
January 17, 2021
Hey everyone—I’m so glad to have you here. What a week.
I’ve been thinking a lot about Tyrone V. Ross Jr.’s appearance on the latest Business Brew podcast. It was a stunner. He offered insight into what life is like for a huge number of Americans as a result of a financial system that is not designed for them. (just to give you an idea: there were 145M working poor in the U.S. even before Covid hit) Many are unbanked, or at best ‘underbanked’—i.e. forced to turn to short-term payday loans, check-cashing services, and prepaid debit cards despite technically having a bank account.
Payday lenders catch a lot of flak for being predatory, but the flak consistently comes from people who don’t need them. Research shows most customers actually have a good experience with check cashing services and payday lenders. The need they fill is a result of the fact that the US doesn’t have a real-time payment system, unlike places such as Mexico and South Korea. (The UK has had one since 2007)
“So even if I do have a bank account, now it’s even worse because if I’m going to be evicted Sunday, I worked my butt off to get paid Friday, that money’s not gonna clear. The landlord’s going to come knock on the door. I can tell you personally as a kid when that happens—and that landlord is really pissed, and they want their money—you don’t want to go through that if you’re anybody, but especially a child. That money’s going to clear Monday? Tuesday? You’re evicted. Your stuff is on the street.” —Tyrone V. Ross Jr.
Government data shows that many people threw out their first prepaid card sent to them by the Treasury with stimulus money on it because they didn’t know what it was.
It’s not hard to see the cascade of problems these knowledge and access gaps cause for people who can’t afford to have more problems, and how hard it is to actually escape poverty in these conditions. There’s also a stigma in society when it comes to talking about money at all, which I fear is misplaced politeness on the part of those who can afford not to talk about it. It’s probably doing more harm than good.
It’s not just financial literacy I’m talking about, but structural inequalities in the entire banking system that make it hard for someone to even begin to get a foothold on their finances.
“[Financial] literacy goes way beyond the difference between a stock and a bond. It’s way, way scaled down. We’re getting people to understand the difference between a checking account and a savings account. What is a ‘maiden name’ when I’m filling this thing out?” —Tyrone V. Ross Jr.
I highly recommend listening to the entire podcast once or twice. It puts into clear terms why talking about what money is and how it works may be one of the most impactful and helpful things you can do for another person. Money is a foundational requirement without which successful lives cannot be built. This is not even about getting more money, but more importantly to better understand how the money game is played.
“I’ve never been a big UBI [Universal Basic Income] guy. Because here’s what I know: you can give me money, but also give me a system that allows me to grow it. I talk about my 3 E’s all the time: Exposure, Education, and Empowerment.
Don’t just placate me. Empower me.” —Tyrone V. Ross Jr.
The conversation touches a bit on the Bitcoin network and why the freedom and access it creates for the unbanked is far more important than the price of ‘bitcoin’ as a medium of exchange. It also highlighted the growing “technology gap” in this country that makes cash transactions so crucial for so many people. The discussion reminded me to ask myself whether I’m using all my fascination with markets & technology just to gather more for myself, or if there are more opportunities to reach back and offer a hand to people that really need it.
It also brought to mind my favorite slogan of all time, from the first and oldest national Black Organization, the National Association of Colored Women’s Clubs: “Lifting while we climb.”
It’s great to aspire to new heights, but so important to think of all the good people behind you that could use a helping hand on your way there.
Until next time,
—Mark
“The price of anything is the amount of life you exchange for it.” —Henry David Thoreau
Breaking 🌊
Walmart is creating a fintech startup. So What? Walmart already offers solutions for the large amount of its customers who are underbanked or have a challenged credit history, like a prepaid debit card with no overdraft or monthly fees and alternative payment plans. The company has built its brand around saving people money, so financial products may be seen as encouraging irresponsible spending but are actually a natural extension of its values and ethos for customers who are more inclined to trust Walmart over Wall Street.
Poshmark, a popular social platform for buying and selling fashion & accessories, ended the day up over 140% in its market debut. So What?: 70 million users strong and over 130 million items sold, CEO Manish Chandra said the company is differentiated by its emphasis on “social commerce”—where buyers & sellers can chat casually about items on the site. Net revenue was up 28% YoY last September, a few months after turning its first quarterly profit, so Poshmark is an IPO that definitely earned the attention it’s getting.
TikTok is set to surpass 1 billion users this year, and has surged past Facebook in average monthly time spent per user. So What?: TikTok has overtaken Facebook’s other 3 apps as well in terms of time spent: Instagram, WhatsApp, and Facebook Messenger. Some of this may be attributed to newer, older users: according to AppAnnie’s data, those 45 years old and above increased their time spent with the top 50 apps by 27% YoY. (18- to 24-year-old and 25- to 44-year-old age brackets were 18% and 17% respectively).
Anchorage has officially become the first federally chartered digital asset bank, putting them on the same regulatory footing as other national banks. This happened in the same week Blockworks launched a new editorial site (similar to Bloomberg for traditional markets) to “help investors understand digital assets.” So What?: It’s the most significant development so far in the ongoing blurring of lines between crypto and Wall Street. It not only sets an important precedent for the space, but lends cryptocurrencies more credibility than ever.
From The Tweetbox 🐦
🔗 Large stocks are trading like penny stocks.
🔗 The importance of using original hardware when viewing vintage game graphics. The difference is pretty dramatic!
🧵 SPAC > IPO because companies have more control over the narrative
For The Pros 😎
The space sector is soaring 🚀🌌 (Link available to Pro subscribers)
How to boost traffic by over 500% with a Google Web Story. (Link available to Pro subscribers)
Why business travel will come back the same way suits will come back. (Link available to Pro subscribers)
How to spot stock market bubbles. (Link available to Pro subscribers)
The cheat code to Instagram success. (Link available to Pro subscribers)
Tip 💡
In your landing page header, say two things:
1. Exactly what your company does
2. How much better you do it than everyone else
h/t @Julian
Check This Out 👀
PNGs 🖼
Monetizing Open-Source - How Tailwind CSS has grown into a $2m+ business:
A stable price is antithetical to being a good store of value because that would mean the supply is centrally controlled. Check out the price of gold since last century:
“The beginnings of all things are small.” —Cicero
Groms 🐣
Fintech start-up Curve is bringing a ‘smart’ payment card to the U.S.
Curve combines all of a customer’s debit and credit cards into one app and a linked “smart” card they can use for payments.
API-based “fintech-as-a-service” platform called Rapyd, covering payments, banking services, fraud protection and more
Rapyd’s customer base now numbers about 5,000 businesses, which includes marketplaces (labor marketplaces and marketplaces for goods), e-commerce businesses, other kinds of lenders and any business that might want to incorporate transactions or new financial services into their wider offerings.
“Don’t tell me what you think, tell me what you have in your portfolio.” —Nassim Nicholas Taleb
Drop Ins 🏄
My latest investments & trades
Buy & Hold Investments (I will hold these forever)
This section is only available for contributing subscribers. If you’d like to trade and invest along with me, consider one of the paid tiers!
Swing Trades (1-3 month time horizon)
This section is only available for contributing subscribers. If you’d like to trade and invest along with me, consider one of the paid tiers!
Barrels 🎯
Portfolio Highlights
Winning Trade of the Week: $SPCE (Virgin Galactic), carved out some profits for a 27% gain
Pods & Schools 🐬🐠
(I clip all my favorite podcasts excerpts on the Bitcast.fm app. Give it a try! You can follow me @markmulvey)
🔊 If you’re looking for a solid critique of Bitcoin, this episode of the What Bitcoin Did podcast is a debate between Frances Coppola and Nic Carter and is full of astute points. Also much more agreement than I and others were expecting!
📚 One Up: Creativity, Competition, and the Global Business of Video Games (2020)
“We aren’t trying to pretend that failing is fun, because it absolutely sucks. We celebrate not the failure itself, but the learning that comes out of that failure.”
📺 On Feb 3 & 4, MicroStrategy will host Bitcoin for Corporations. “Join our officers, industry luminaries & strategic vendors for a free, online, accelerated course in Bitcoin strategy & tactics to grow your company & create shareholder value.”
Tools of the Trade ⚒
Products I use to make money
Wealthfront. ~25% of my portfolio is in Wealthfront, which since 2016 has netted me a time-weighted return of ~53% (~50% money-weighted) at the time of this writing, all while harvesting tax losses like the pros do.
Use this special link to get your first $5,000 managed for free: https://wlth.fr/2ephpyb
StockCharts. I easily make back the small monthly subscription fee with the superpowers it gives me.
Carrd. Use this link or referral code 892PYX69 to start your own web empire.
Disclaimer
Nothing in this email is intended to serve as financial advice. Do your own research.