Tuesday morning news drop
Canada's housing market is betting interest rates will never rise. The low interest rate loans that are helping propel one of the world’s frothiest property markets could also be what make it burst. For 12 consecutive years, Canada’s housing market has soared to record heights. Tight inventory, particularly in Toronto and Vancouver, has made property price appreciation and bidding wars among the most aggressive anywhere. This has pushed Canadians into playing a very dangerous game. (Bloomberg)
How Often Should You Expect a Stock Market Correction? Since 1950, the S&P 500 has had an average drawdown of 13.6% over the course of a calendar year. Over this 72 year period, there have been 36 double-digit corrections, 10 bear markets and 6 crashes. This means the S&P 500 has experienced on average a correction once every 2 years (10%+) a bear market once every 7 years (20%+), a crash once every 12 years (30%+) (Wealth of Common Sense)
‘It’s All Just Wild’: Tech Start-Ups Reach a New Peak of Froth How crazy is the money sloshing around in start-up land right now? It’s so crazy that more than 900 tech start-ups are each worth more than $1 billion. In 2015, 80 seemed like a lot. It’s so crazy that hot start-ups no longer have to pitch investors for money. The investors are the ones pitching them. It’s so crazy that founders can start raising money on a Friday afternoon and have a deal closed by Sunday night. It’s so crazy that even sports metaphors fall short. There’s more money and more bubbly behavior; Investors insist it’s rational. (New York Times)
The Market is an Expensive place to Find Out Who You Are. Netflix has 70% more subscribers, twice as much revenue, five times as much income — and the same market cap. Investors don’t care about what you’ve done, they care about what they think you’re going to do. By 2018, investors had pulled forward all of the growth. They did this by assigning too high multiple to its underlying fundamentals. And today, like all growth stocks, Netflix is being rerated. (Irrelevant Investor)
Tales From Crypto: A Billionaire Meme Feud Threatens Industry Unity A dispute over “web3” in the cryptocurrency industry was publicly exposed in a Twitter spat between Jack Dorsey and Marc Andreessen. Here’s what it’s all about. (New York Times)
Makeup and Money: The Persuasive Pull of Beauty Influencers In the world of big cosmetics companies, authenticity has become a currency (Walrus)
The true cost of policing N.J. officers averaged $123K a year, adding tens of thousands of dollars to their paychecks with little oversight. (NJ.com)
How the Refrigerator Became an Agent of Climate Catastrophe: The evolution of cooling technology helps to explain why supposed solutions to global warming have only made the situation worse. (New Yorker)