Tag Archives: X Corp to do IPO

Nov 24 2023

Black Friday – A Key Weekend for Retailers


Posted originally on Nov 24, 2023 By Martin Armstrong 

Recession

Retailers have been preparing for Black Friday and Cyber Monday all year. The tradition of post-Thanksgiving shopping has spread internationally with companies throughout the world promoting special sales. The National Federation of Retailers in America predicts that 2023 will be one of the busiest shopping holidays in the nation’s history.

Around 182 million shoppers are expected to make purchases from Thanksgiving Day through Cyber Monday, marking a 15.7 million uptick from 2022. This also marks the highest estimate since the organization began compiling data in 2017. Despite inflation, 61% of 8,424 respondents to a poll said the deals presented are too good to pass on.

The bulk of spending is expected to occur on Black Friday with 130.7 million participants, followed by Cyber Monday which is expected to attract 71.1 million shoppers. Half of shoppers will be searching for presents for the upcoming holidays. In total, retail spending in November and December will reach up to $966.6 billion.

“The Thanksgiving holiday weekend marks some of the busiest shopping days of the year, as consumers enjoy the tradition of shopping for the perfect gifts for friends and loved ones,” NRF President and CEO Matthew Shay said. “Retailers have been preparing for months for this occasion. They are stocked and ready to help customers find the gifts and other items they want at great prices during the entire holiday season.”

Although consumer spending accounts for 2/3 of GDP, the majority of Americans are living off of credit due to record inflation. So while people are spending during this 5-day holiday in anticipation of tomorrow’s price being higher, consumer spending at this point in time merely adds to the private debt crisis sweeping the nation.

Nov 5 2023

Interview: Gold and the Dollar will Rise Together Re-Posted Nov 5, 2023 By Martin Armstrong 


Watch the video above or click here to watch my latest interview with Goldseek Radio.

Head of Armstrong Economics, Martin Armstrong, outlines his gold market projections in lieu of unraveling geopolitical conditions.

Armstrong says, “You have a lot of uncertainty and confusing trends developing. When this materializes in people understanding what’s happening…the dollar and gold would go up together. Because you are looking at a flight of capital. Some people want to buy gold, some people want to get out of Europe, etc. Not everybody does the same thing. The two trends will come together. That’s what our computer is projecting, and it’s happened many times in history.”

– Epic gold breakout ahead!
– Convergence of economic themes – recession next year and escalating conflicts?
– Comments on crude oil.
– On the cusp of WWIII by 2025?
– How to foment de-escalation within the ranks of the power-hungry elite.
– Might societal decay accelerate?
– Tangible assets are key to surviving collapse.
– 90% silver coins remain an ideal survival investment.

Oct 4 2023

A Strong Possibility Twitter Will IPO and Go Public Again, Here’s Why


Posted originally on the CTH on October 3, 2023 | Sundance 

I wasn’t going to write about this, but so many requests and contacts have come in, and considering that my background conversations with people are leading to actionable positioning, that I feel it is only fair to share publicly what I am analyzing privately.

The predicate for all assumptions is several fold: {Go Deep One} and {Go Deep Two}. Most of the financial groundwork for analysis already exists. In summary, Elon paid $44 billion for the platform. Current valuations are around $15 billion.  Current debt service is $1.5 billion/yr (roughly $100m/mo).  Current expenses include $100m/yr AWS, $100m/yr Goog cloud (both contracts), +payroll and misc.

Approximately 9 months ago, Musk had $1 billion in cash reserve for Twitter.  The burn rate deficit was roughly $100m/month. That put timeline estimates for an inflection point on/around October 2023.  It is now October 2023.

Approximately a week ago, Twitter CEO Linda Yaccarino made a bold statement.  Yaccarino stated that from her review of the current status, Twitter would start to turn a profit in the first quarter of 2024 {link}.  However, with $100 million per month in debt service alone, this statement seemed too far of a stretch.  At pre-musk levels of revenue, maybe; but that $1.5 billion debt service is a heavy nut to carry.

Timing – Remember, it’s October.  Last Friday, the Securities and Exchange Commission (SEC) gave special regulatory approval to Bill Ackman’s firm, Pershing Square (hedge fund), for a new investment vessel called SPARC, whose purpose is to invest in private companies in order to take them public.  As noted by CNBC, “In a SPARC, investors will know what company the financing vehicle would be used to merge with before they have to pledge their investments.”  The financial mechanism avoids some of the issues with typical IPO’s.

•It’s October, inflection time.  •Yaccarino says a strategy is underway for profitability in Q1 2024.  •Ackman gets SPARC approval, and then suddenly:

[…] “The answer is I have a lot of respect for Musk. I think Twitter is a really important platform,” Ackman told CNBC. “I think he’s made tremendous improvements to the platform, and I think it’s a unique, very difficult-to-disrupt, kind of asset and one that could grow.” 

[…] Though Musk hasn’t expressed any interest in working with Ackman to take X public, and despite the $13 billion in debt tacked to the company, Ackman has worked out a loose plan to make it happen, if Musk were interested. 

“What’s interesting here is we could commit $2 billion to a transaction, set the rights price to $121 million, set it at $100 a share and announce a transaction,” he said. 

“And then we tell the story and then the rights holders have a chance to decide whether to invest. As long as the rights have positive value, they’re all going to get exercised, and the IPO raises $13 billion.” (read more)

The heavy nut disappears.

Investors roll the debt into discounted shares of stock.  If Ackman can generate a $17-$20 billion outcome for Twitter, Musk nets $5b and retains 20-25% of shares.  Yaccarino gets well compensated.  It’s a win/win/win.

Critics would say the IPO would mean Musk compromising on the free speech commitment.  However, in reality Musk has already reinstalled many of the control mechanisms of the previous “safety council,” along with the “freedom of speech, not freedom of reach” outlook.  Musk and Yaccarino have also partnered with the Global Disinformation Index.

The compromises are already baked into the platform, and seemingly have been since Yaccarino became CEO.  The 2024 election is next year, and influence is a lucrative business.