🦈 Duunnn dunnn… duuuunnnn duun…- Nailed the Jaws theme song reference with that one. Anyways, Rocket Companies has purchased Redfin (now you get the shark reference) for a cool $1.75 billion in an all stock transaction. Rocket Companies, the company behind Rocket Mortgage, wants to build a real estate super app, so consumers can check their phone to do everything from finding → financing transactions. Redfin’s stock had been suffering as of late. In 2021, Redfin traded at $96 per share, but over the past 3 years, it has been trading below $10. The $12.50 share price for the transaction will represent a 63% premium over Redfin’s volume weighted average price (VWAP) for the previous month.

🐉 “(Pikachu) Niantic I choose you” - 2 for 2 on pun headlines to announce mergers and acquisitions. Don’t hate the player, hate the game. Niantic, the maker behind Pokemon Go, is selling itself for $3.5 billion to Scopely. Scopely is Saudi Arabia-owned, and the transaction reflects the growing ambitions of Saudi Arabia to become the “ultimate global hub” for gaming. Saudi Arabia has been taking oil money and trying to make it, well, anything but oil money as they diversify away from fossil fuels.

🥊 Zuck catching bodies - Everyone’s favorite (dictator) nerd is out here catching bodies in his post masculine energy phase. He recently wore a shirt with the lettering Aut Zuck aut nihil, which translates to “Zuck or nothing”. The shirt was a nod to the Latin phrase Aut Caesar aut nihil. In typical nerd fashion, a fight broke out centered around Latin phrases when Bluesky CEO Jay Graber wore and sold out of a shirt with the phrase Mundus sine Caesaribus, or “a world with Caesars”. Additionally, a former Meta executive came out with a book chronicling her dark time at Facebook for 6 years. The book reveals some not so great things about Meta, and Meta is trying to quiet down the promotion of the book. Anywho, don’t feel too bad for Zuck, the guy still is worth north of $200 billion.  

Over the past few weeks, the stock market has given me more whiplash and nausea than the Gravitron ride at the Jersey Shore. It hit 70 degrees here this week in DC, so I am dreaming of summer, forgive me.

The market has been anything but beachy (damn it Alex, focus). A mixture of events has led to the uneasiness in the market. Let’s dive in, shall we?

What happened this past week?

On Thursday, the S&P 500 entered correction territory. The S&P 500 is a commonly quoted stock index that measures the value of a “basket of stocks”, and economists look to it as an indicator or benchmark for the broader market. Correction territory is defined as a decline of more than 10% from the recent closing high. The S&P 500 dipped by 1.4% on Thursday, which meant it fell by 10.1% from its recent all-time high set just 3 weeks ago.

Then, on Friday, all major indices rebounded, and the S&P 500 gained 2.1%. Overall, the trend has been downwards as the Dow notches its second losing week & worst weekly decline since March 2023. Not to be outdone, both the S&P 500 and Nasdaq had their fourth negative week in a row.

What has been causing the volatility in the market?

While Fooled by Randomness would argue not to put too much weight behind any one event causing the downward spiral, we can point to a few indicators that definitely helped.

#1: Trade policy unpredictability

You ever been around a baby, or Joey when he’s tired (threw him off with the first paragraph reference, doubling down to see how far he makes it)? You know how they both will begin to cry out, then calm down for a second, then cry out some more with seemingly no logic behind it. That has been going on as Trump has been threatening, then pulling back, then threatening tariffs abruptly both over traditional media and through his social media platform Truth Social.

In response, other countries have been threatening tariffs back. While some analysts see the tariffs from the US as posturing, others aren’t so sure, and thus, the market has been sounding the alarms and silencing them on a 24-hour cycle.

Nobody said his Presidency wouldn’t keep us on our feet.

#2: Consumer sentiment decline

The University of Michigan puts out a consumer sentiment report that measures how consumers feel about their finances and the state of the economy. As worries over tariffs, government layoffs, funding cuts, and immigration restrictions settle into people's minds, the consumer sentiment index dropped 11% to 57.9 in mid-March from 64.7 last month. This is the lowest level since November 2022 and came in lower than the economists' forecasted 63.2. Compared to a year earlier, the index is down 27%.

While this doesn’t necessarily mean that consumer spending will go down, it does provide a worrisome warning sign. If consumers stop spending, consumer-facing businesses will hurt and the economy will worsen.

#3: Fear of stagflation

You thought inflation was bad? Now, imagine it with little to no economic growth and elevated unemployment. That is what we call stagflation (stagnation + inflation = stagflation).

In a trade war, which we are currently engaged in, the prices of goods will rise, while simultaneously reducing the growth of the economy. While this week’s inflation report had the headline inflation number at 2.8% in February, below what was projected to be 2.9%, there is fear the number does not reflect all there is to come.

What was the effect on investors?

The market is easily spooked. This may be due to algorithmic trading or irrational actors, but regardless, the impact of these events will mean we are in turbulent times for the foreseeable future.

The common thread amongst all fears, is just that: they are fears. Fear of the unknowns, fear of the unknowns in perceived knowns, and fear of because everyone else is afraid.

Conclusion

In turbulent times is when big wins occur. There is an investment theory called weighted dollar cost averaging. In it, it argues that to time the market is a fool’s errand. How do we know when a market has hit its peak or trough? We can’t until after it has happened.

The theory goes that if you invest the same amount on fixed intervals, you will invest both at the peaks and troughs. As a result, you will lock in a steadier rate of return in line with the average yearly return of 9% (avg. yearly return of the S&P 500 over the past couple decades). Meaning, if you invest $5k each month or every other week, you can lock in a steadier return over time. It takes timing out of the equation.

Or, you can lock into alternative assets like real estate that weather the good & the bad times.

Or, you can weighted dollar cost average real estate investing with mogul. Okay, enough Alex.

mogul investor appetite for premium Austin real estate remains at an all-time high, with The Johnson already surpassing $357,000 raised and leaving just 45% of its allocation available.

This impressive momentum builds on the back of a true flagship property. The Johnson has over a year of robust, verified performance, featuring an NOI yield exceeding 10% and trailing 12-month rents of $190K at roughly 80% occupancy. The underwriting projects first-year rents of $210K, along with an additional $50K in future bookings transferring seamlessly at closing, accelerating cash flow for investors right from day one.

Savvy investors recognize Austin’s fundamentals remain exceptionally strong, driven by major employers like Apple, Tesla, and Samsung. The Johnson’s metrics underscore this appeal, with a projected levered MOIC of 2.7x and levered IRR of 16.2%.

With just 45% remaining, now is the time to secure your spot in this beautiful property.

Invest Now

• Musk causes controversy that causes the value of company to decline. Honestly, if you just read that first sentence, that could be interpreted a million different ways. Would show you if you were a glass half full or Musk half empty kind of person. Tesla's market value has dropped nearly 50% over the past few months. Since last fall, it has lost almost $800 billion in value.
• Bags will no longer fly free, and people are pissed. Southwest ended one of its staple offerings of allowing you to check a bag for free, and the airline’s cult following is striking back online, calling for a boycott.
• Just found this one funny. The driverless cars from Waymo racked up 600 parking tickets in San Francisco alone.

As I am sure you can tell from some of my book reviews, I love books about human psychology, and this week is no different. The book explores the relation between random events and perceived skill. Ultimately, luck drives a majority of outcomes, but if someone comes out ahead, the perception is the person is very skilled, especially when it comes to the world of trading.  

The book itself is definitely a bit drier than other books reviewed, but if you like this kind of stuff, you can't go wrong with this one.

⭐ 4.74 / 5.0 in my book (no pun intended)

1. "I want to get chocolate wasted"
2. "You won't be lost, hurt, tired and lonely. Something beautiful will come your way" - hint, it's a lyric
3. "I don't really think it's fair for me to be on a jury because I can read thoughts"

Elon Musk isn't the founder of Tesla. The two founders are Martin Eberhard and Marc Tarpenning. In 2004, Elon Musk led the company's first funding round becoming its chairman. He quickly became CEO in 2008.

1. Grown Ups (Little girl from grown ups)
2. Something Beautiful (Robbie Williams)
3. 30 Rock (Liz Lemon)