5-Chart Friday (2/5/21)

By Charlie Bilello

05 Feb 2021

5 charts from the past week that tell an interesting story in markets and investing…

1) Game Over

All games eventually come to an end, and this one was no different.

The mania that swept the nation last week ended as many had feared, with GameStop down 89% from its high last week.

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The progression in its market cap from the start of the year is sunning…

Other highly shorted mania names that were targeted by the Reddit message boards all saw substantial declines this week as well…

The narrative pushed by the media and egged on by billionaires and celebrities was that GameStop was a victory for the “little guy.” But was that really the case, or were they the ones left holding the bag?

2) Big Four Domination

The combined annual revenue of the 4 largest US companies has surpassed $1 trillion for the first time…

  • Apple $AAPL: $294 billion
  • Microsoft $MSFT: $153 billion
  • Amazon $AMZN: $386 billion

That’s larger than the GDP of all but 16 countries.

Their combines market cap of $7.2 trillion is over 22x higher than where it was at the lows on March 9, 2009 ($326 billion).

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3) Going Out on Top

Jeff Bezos announced that he will be stepping down as CEO of Amazon later this year, ending a era that will be nearly impossible for anyone to match.

Since he took the company public in 1997, Amazon revenue went from $150 million to $386 billion. That’s an annualized growth rate of 41%.

Perhaps even more impressive is the patience investors afforded Bezos in realizing his long-term vision. In their first 6 years as a public company, Amazon lost money…

Capping off a record 2020 was this remarkable statistic: Amazon added 500,000 employees during the year (going from 800k to $1.3 million), a 63% increase over 2019. Has any company in history hired more workers in a single year?

4) More Stimulus, More Debt, More Inflation, More Crypto

The superfecta in macro trends continues…

a) More Stimulus is on the way, with the Senate approving a budge measure that will pave the way for another $1.9 trillion. Here are some of the key provisions…

b) More Debt

How are we paying for all of this? We’re borrowing it.

US National Debt is on pace to hit $28 trillion in the next week, up from $23 a year ago.

c) More Inflation

The surge in US inflation expectations continues unabated, now at their highest levels since March 2013.

d) More Crypto Gains

Investors continue to seek out alternatives to fiat money, with Ethereum now up 1,500% from its lows last March.

5) Encouraging Covid News Continues

Covid-19 Hospitalizations in the US are back to pre-Thanksgiving levels, down 43k from their peak on January 6.

The number of new covid-19 cases per day is down 47% from its peak on January 11 (244k -> 130k).

Johnson & Johnson announced their vaccine application for emergency use, saying that they are on track to produce 100 million doses by June. This is extremely good news as their vaccine was shown to have high efficacy (85% protection against severe disease) and is just a single dose (vs. 2 doses for Pfizer/Moderna), meaning the road to herd immunity should be much shorter.

And that’s it for this week. Thanks for reading.

Have a great weekend everyone!


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Disclaimer: All information provided is for educational purposes only and does not constitute investment, legal or tax advice, or an offer to buy or sell any security. For our full disclosures, click here.

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