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Nvidia's rocketship takes off.

May 25, 2023

Today we have:

  • Could inflation reduction act not make much difference to global emissions?

  • Big Insurance doesn’t seem to be disrupted any time soon.

  • Meta sells Giphy to Shutterstock.

    Let’s take a look.

The Big Picture

President Biden’s Inflation Reduction Act is essentially this - Use subsidies to move energy production and home usage to renewable energy and electric vehicles. What are the target numbers like? Greenhouse gas emissions should be 40% lower by 2030 compared to 2005.

Source: ourworldindata.org

Research firm Rhodium Group stated that US emission reduction due to the act is estimated to be 6-10%. According to the Princeton lab group, this number would be 15%. Even so, US contributions would amount to a mere 1-3% reduction in global GHG emissions. Experts say the bill could really make an impact on technology adoption for economies of scale. Between 1980 - 2012, the cost of photovoltaic modules in solar dropped by 96%. This led to more efficient modules and thinner silicon wafers. The act’s tax credits could make ‘green hydrogen’ (produced by splitting water into oxygen and hydrogen) more competitive compared to ‘gray hydrogen’ (produced from natural gas).

Sector Sweep

Tech

  • Nvidia’s shares doubled this year and 25% just yesterday to take them to a market cap of over $900 billion. As the AI market grows, Nvidia’s infrastructure support to AI is expected to grow as well. Nvidia stated right now they are working with Microsoft, Amazon, and Google to help build generative AI.

  • Insurtech companies: Lemonade, Root, and Hippo have lost significant market share post the promise of disrupting the insurance sector with data and algorithms. Customer acquisition, inadequate data, and changing state regulations have hampered the growth of Insurtech companies.

  • Shutterstock has agreed to buy Giphy from Meta for $53 million in net cash. Meta acquired Giphy in 2020 for $315 million.

  • Netflix released a statement saying users who share an account outside their home would be charged an additional $7.99/month.

Automotive

  • China is now the world’s top automotive exporter with 1 million vehicles this quarter, a 58% rise YOY.

Retail

  • Small businesses are looking to cater to the new world of hybrid work. Turning coffee shops to co-working spaces, adding a makeup counter for Zoom calls, setting up networking events in the middle of the day.

  • Coco Republic,H&M, Abercrombie & Fitch and Crate & Barrel are closing shops in San Francisco while luxury retailers like Patek Philippe, Chanel, Saint Laurent, Bottega Veneta seem to be opening stores as they can afford increased security.

Finance bro term of the day: Leverage

It refers to a financial strategy of using borrowed money to increase a future return on investment. Companies often use this type of debt to finance their operations.

 

That’s all for today folks. Do keep a lookout for our weekly email about stock deep dives and personal finance strategies this Saturday.

BTW, do tell us how we did. Just hit us with a reply.

Cheers!

Memetic Universe

When I ask Midjourney to make a meme about Xerox machines.

Stay away from memes kids.