Week of 1/8/24

Prepared by Will Nelson for Tom Donohue

Welcome to all our new subscribers, we hope you had a great holiday break! As always, please reach out with any feedback by hitting reply - Will

Stories that drove last week

• Middle East tensions continue to grow with fear of a regional conflict

  • Israel declares victory in Northern Gaza

  • Houthis demonstrate the definition of asymmetric warfare

  • Attacks in Iran

• Epstein documents unsealed but mostly confirm what we knew

• Harvard President out after plagiarism & hill testimony complaints

Domestic News

• Politics

  • 2024 Race

    • Republican Primary Polling

      1. Trump (61.3%) [+0.6% since last week)

      2. Desantis (12.1%) [+0.4% since last week)

      3. Haley (11.2%) [+0.2% since last week]

      4. Ramaswamy (4.8%) [1.3.% since last week]

      5. Christie (3.4%) [+0.0% since last week]

• Trump has been removed from the ballot in both Colorado and Maine

  • In Colorado by the State Supreme Court through the application of Section 3 of the 14th Amendment regarding participating in insurrection being disqualifying

  • In Maine it was the Maine Secretary of State that made the decision after voters challenged his qualified as allowed under Maine law citing the same Section and Amendment

  • Both decisions have received large amounts of pushback as Trump has not been criminally charged with insurrection

  • The Supreme Court has agreed to take up the case and it their decision will be highly anticipated, some speculation on how it could go HERE

• New polling shows that Trump’s lead, while resounding, may not provide a clear path to consolidate support, with 44% and 46% of Ron Desantis and Nikki Haley’s respective supporters saying they would choose the other candidate before Trump. Trump seems to see Haley as is his biggest rival
  

• Biden Administration

  • Lloyd Austin was secretly in the hospital unbeknownst to his second in command and Biden?

  • The FCC Commissioner accused the White Houser and other agencies of targeting Elon Musk after Starlink lost out on nearly $900 Million of subsidies for rural broadband. The FCC claimed it was worried SpaceX was not meeting a specification of the contract that was not in effect until 2025.

• Other Big Stories

  • Congress reaches a spending deal to keep the government open 

  • Epstein document releases mostly confirmed what was already known

• Economics

  • Markets

    • Equities

      1. S&P 500 (-1.1% last week)

      2. NASDAQ (-1.6% last week)

      3. DJI (-0.7% last week)

    • Big Stories

      • Consumers add debt as pandemic savings dwindle

      • Yet, searches for “Recession” have fallen sharply

Global News

1. Conflicts

   1. Israel

      1. Israel says Hamas dismantled in Northern Gaza

      2. Houthis attacks in the Red Sea are massively disrupting commerce with 95% of the container ships that would’ve passed through the Red Sea are now diverting around the southern tip of Africa

         1. This has already driven US west coast freight prices up by over 50%

   2. Ukraine

      1. Support for Ukraine seems to be waning

         1. Biden claimed “We are coming to the end of our ability to help Ukraine” in mid December

         2. Zelensky went on Fox News and implored the US to expand and continue its support which was not well received

            1. “Don’t build roads. Spend all your money on weapons, drones, Society and pensions… we have only one enemy: Putin.” -Zelensky

      2. New details are also emerging about the peace deal that appeared to be on the table early in the war before Boris Johnson dissuaded Zelensky from agreeing to the peace deal and promised support 

2. Russia

   1. North Korea supplying Russia with missiles fired on Kharkiv

3. China

   1. Xi continues his ouster of senior government and military leaders. It is unclear if he is struggling to retain control over the government or is simply consolidating power further.

4. Other

   1. Asymmetric warfare in its purest form as US is using $2,000,000 missiles to shoot down $2,000 Houthis drones

      1. In addition to cost, the US and West are burning through limited missile supplied that manufactures can’t replenish fast enough

      2. We are even asking Japan to send Patriot missiles to replenish our stock for the first time ever

      3. Fascinating and well timed: Anduril Technologies just debuted a perfect solution

   2. ISIS takes responsibility for dual blasts in Iran that killed 95 at a memorial for Qassem Soleimani who the US killed in a drone strike in 2020

Reading List

1. If you're a capital allocator or investor I cannot recommend this podcast enough. [102 minutes, Spotify, apple podcasts, etc]

   1. Jeremy Giffon discusses esoteric opportunities in private markets, misaligned incentives, and coordination problems. The conversation also covers compensation advice, unconventional signs of alpha, meeting heroes, and the value of having an audience.

2. A case for optimism 

3. Apple getting closer to retail launch of Apple Vision Pro

4. For startup folks: Carta is in hot water after some sketchy self dealing and internal data sharing [X]

   1. A funny take on the drama [X]

5. A report on the state of the Chinese Economy and their position in the world order [Hudson institute]

6. An interesting vignette about Germany’s energy economy [X]

7. A motivating idea from Sahil Bloom: