Capital One is a bellwether for the middle-class American consumer.

It sees who is spending what, where, and when.

$COF reported earnings today, providing early data that both supports and challenges the narratives around consumer behavior after Liberation Day.
🧵👇 1/x 2. Consumer Spending

Trends were stable through 3/31, but since then:

- iPhones: very modest consumer electronics "pull forward" $AAPL

- Autos: noteworthy spend uptick as consumers try to "get ahead of tariff impacts."

- Travel & Entertainment: T&E spend "growth" is easing, especially airlines (unclear if this means overall spend is down or it's growing slower)

Tariffs are Beautiful

We were taught tariffs triggered a spiral into the Great Depression.

That tariffs are inherently inflationary.

But tariffs are just another tax.

As with any tax, it creates a set of incentives.

And, as far as taxes go, tariffs are beautiful.
🧵👇 2. Zoom Out

Governments need revenue to operate.

They overwhelmingly get their revenue by taking it from the people they serve, generally in the form of a tax.

There are better and worse taxes, ipso facto.

It is hard to know what to make of xAI buying X.

My gut is it smacks of desperation.

On the surface, the deal values @X flat to Twitter’s 2022 takeout value, despite massive underperformance on financial metrics.

Sounds like a win of sorts for X shareholders… 🥇

…BUT
1/x 🧵👇 …it is a stock deal and X owners will now own 29% of combinedco, shifting from a near-pureplay social media bet in a HIGHLY strategic asset to an AI bet that’s very much on the cum plus a diluted share in Twitter.

Yes, xAI is a powerful model.

But not unusually so.
2/x

“Vox populi, vox dei.”

So goes one of Elon’s favorite quotes.

Today we learned while the voice of the people may be the voice of the gods, in Delaware there’s only one true god:

And her name is Chancellor Kathaleen McCormick.
1/x 🧵👇

Below is a brief thread breaking down her denial of Elon’s request for $55 billion in $TSLA stock. 2. Her original January 2024 ruling highlighted several flaws in the years old shareholder vote that was meant to award Elon massive stock compensation, if he delivered massive value to $TSLA shareholders.

Her determination wiped out Musk’s entire equity grant, stating Tesla failed to follow required procedures, which invalidated the original vote from years ago to grant the compensation package.

1. $CVNA has 67x'd (!!) in less than 2 yrs, bottoming Dec '22 at $3.72 vs ~$253 today.

I'm sympathetic to the short-seller view, but also was at $10.

Praise Allah, I avoided this career-killer. Despite its sketchy history, it's short-seller death.

That said, inshallah.
🧵👇1/x 2. Last Q, Carvana sold 234k cars. while booking (heavily) Adjusted EBITDA of $429 million.

That's an EBITDA per unit sold of >$1,800, more than most used car retailers make in GROSS PROFIT per vehicle, much less EBITDA per unit.

A 12% Adj EBITDA margin for a used car retailer!

Rare footage of Mrs. B - Rose Blumkin.

Mrs. B founded Nebraska Furniture Mart in 1937 with $500 of savings, selling 90% to Warren Buffett’s $BRK 50 years later for $55 million.

Even at 94-years old, she continued to work 70 hour weeks, pricing rugs and carpets from memory. 🧵👇

“We like managers who are in love with their business…who feel like I do - I want to tap dance when I get to the office,” is how Buffett answered Adam Smith’s question about the Berkshire Hathaway culture.
1/x
Mrs B barely spoke English when she started NFM; she sought a $75 business loan and was denied.

50 years later, what did she think of the doubters?

“I still hate them. Anybody who does you dirty, you should never forgive and forget.” ☠️

- Rose Blumkin at 94 years young

1. $COIN just reported Q3.

Most people assume it makes its money as a crypto exchange.

True...sort of.

Its rev comes as much from interest income on its cash balances + its share of $USDC's cash ($COIN owns a share of USDC owner, Circle) as from transactions.

Worrisome.
🧵👇 2. Interest Income is Lower Quality

Even as $COIN's core transaction revenue has declined by nearly HALF, its interest income has skyrocketed with rising rates.

In Q2 2022, interest was 5% of revenue; in Q2 2023, it was 35%...

The Rise of Temu.

Temu launched first in the US and is owned by Chinese e-comm giant $PDD, targeting the value-oriented customer.

It's a 3P model but w/ the experience controlled by Temu in more of a "1P" manner (pricing, warehousing, shipping).

In just 1 year (credit $GS):
🧵 2. Value Buyer

Given its low-priced proposition, it's no surprise that Temu is winning more business in states that have lower average per capita income.

In the next 9 days, we will learn the fate of the cable TV industry.

Disney has pulled its programming from Charter's TV customers, launching a momentous battle.

For years, content owners like $DIS held the upper hand.

Now, $CHTR is poised to win. Let’s talk about why.
🧵👇 1. Why now?

So-called “carriage battles” (CHTR “carrying” DIS content) ALWAYS surface around important sports, generally football.

$DIS's key TV asset is ESPN - ESPN is THE home of college football.

Today is opening day.

$DIS chose to pull its content 36 hours before kickoff.

Today, Enovix, a science project battery company, posted a long letter trying to stop a reporter from investigating it. The letter culminates by calling me "ringleader" of a short group that coordinates trades.

False.

One might ask, "why is $ENVX so afraid of inspection?"
🧵👇 2/ There really are some $ENVX "ringleaders" on Twitter, but they are insanely bullish. They're also bullies: Marc Cohodes and Greg Reyes. They lie, distort, attack, and malign anyone who questions Enovix.

They claim to have a special relationship with ENVX Chairman, TJ Rodgers.

The @SECGov crypto enforcement team has been busy af...

...today it sued $COIN, after suing Binance and @cz_binance yesterday.

Gary, I can only summarize lawsuits so fast...

Let's dig in.
🧵👇 1. The Dog that Didn't Bark

As you can see in the below image, in yesterday's Binance suit, Binance founder @cz_binance himself was listed as a formal defendant in the SEC complaint.

In the $COIN lawsuit, no individual is included.

Coinbase CEO Brian Armstrong just exhaled...

I really didn't want to do a Tweet thread on the @SECGov suit against @binance, but then I read it and...

...it's absolutely FULL of GEMS. I can't not do it.

Example - Binance CCO in 2018:

"we are operating as a fking unlicensed securities exchange in the USA bro."😱😂

🧵👇 1. It's worth stating that it's not just a suit against Binance - the SEC is also suing @cz_binance himself.

I suspect we will never see CZ voluntarily set foot on US soil again, nor countries with whom we have strong extradition treaties...

I’m racking my brain to see if I can recall a dumber premise for what’s basically a factless political opinion.

NYT argues $WMT demands lower prices from suppliers leading suppliers to require higher prices elsewhere to compensate.

If true, $WMT would not have seen inflation. So, did $WMT see grocery inflation?

Yes. Tons. Inflecting in 2021.

From a Yahoo! Finance article:

$TWTR CEO Prediction Time:

✅ Is a woman

✅ Loves rockets

✅ @elonmusk Follows her

✅ She’s retweeted Elon recently

✅ a16z partner (big $TWTR coinvestor)

@KTmBoyle twitter.com/i/web/status/1… Loves rockets.

Believes in America.

Former reporter at @washingtonpost.

1. I just read Carl Icahn / $IEP's response to the @HindenburgRes short report.

Talk about a waste of my time - near-zero rebuttal, but using a few thousand words.

$IEP also quietly ignores the fact Hindenburg was right about misleading valuations of at least 3 key assets.
🧵👇 2. The "rebuttal" does not establish any meaningful factual errors by Hindenburg.

$IEP also acknowledges Carl's investment performance has sucked for several years...

...but says unit's oddly high valuation vs. NAV is deserved based on Carl's status as an "iconic" "legend." Ok.

1. Evan do what Evan want to do.

$SNAP is Exhibit A of ATROCIOUS governance, highlighting the risk of Super-Voting.

Public owners have ZERO voting and are being fleeced.

Shareholders should *never* again accept a near-perpetual situation like this...

...but they will.
🧵👇 2. $SNAP is Run for the Employees

In 2022 alone, Snap granted 134+mm RSUs (shares with a 4-year vest)! 134 million! WTF?!

~8.5% of the company given to employees IN ONE YEAR.

And it's not an anomaly.

1. If you love science project battery-tech companies that you think were awarded "massive" US Gov't / DoD contracts... $ENVX

...you may want to look up how much a CWB pack sells for + how many soldiers are in the US Army (hint: $100/pack + <500k soldiers).

Annual TAM is...🧵👇 2. ...~100k CWBs, so maybe $10mm ANNUAL jump ball w/ FOUR qualified bidders.

Estimate what % of that "TAM" Inventus (Enovix's partner) gets & then $ENVX's $ share of that.

Sell-side says it's a 9-figure annual opportunity!

It may not even be a 7-figure annual opportunity. lol

Banking fragility has worried
@BillAckman for decades.

A 28-year old Ackman “from New York City” once asked Buffett about Salomon Bros’ 30:1 leverage at $BRK 1994 AGM.

That risk profile catalyzed the GFC in 2007-09.

Now he’s worried about systemic risk again.

A short 🧵👇. 1. Perhaps this line of investigation contributed to Bill’s famously successful short of $MBIA and its GFC implosion…

Or his observation that CDS spreads might blow out during early days of COVID…

And who knows how he’s positioned now?

But we know he’s worried…

Read on.👇

Art anticipating life.

As it relates to the CoCo, I recommend you avoid both the financial and nostril variety. Reference:

https://twitter.com/compound248/status/1637565740118147073?s=46&t=SmRs2hs8UVYDbY_ZrGe0XA

If you’re “taking a flyer” on a wounded and wobbling US bank stock with “takeover” as your thesis, bear in mind $UBS is basically being forced to acquire $CS for $1 billion…

…and the market cap of $CS at Friday’s close was $8 billion. 😬

Not good, Bob. Not good. 😂 …and an insanely loose MAC clause.

https://twitter.com/puppyeh1/status/1637474650782408706

Well, we know who’s going to acquire $FRC if it ever fails…

Jamie ready to buy the Crown Jewels. $JPM Some banks have better franchises than others.

https://twitter.com/compound248/status/1634690992619294720