What we’re reading (10/10)
“Is The ‘Unicorn’ Boom Turning Into A Bubble?” (Fortune). “The number of pre-IPO startups worth more than $1 billion has skyrocketed globally…[a] total of 136 startups achieved unicorn status in Q2 of 2021 alone, more than in all of 2020. After the initial meeting with a founder, investment decisions are made "in a matter of days, or maybe even a week,” says Sumi Das, partner at Alphabet’s private equity arm, CapitalG. A couple years ago, that was typically a two- or three-week process. And it’s not just VCs sloshing money into startups: Hedge funds, mutual funds, and sovereign wealth funds are entering the private market, both inside and outside the U.S.”
“A Bunch Of Fitness Companies Have Jumped Into The IPO Market This Year. It’s Not Working Out.” (MarketWatch). “Has the U.S. IPO market reached peak fitness? It may have, based on Thursday’s market, which saw the latest fitness company to go public — Life Time Group Holdings — flounder in early trade, while another expected this week, iFit Health & Fitness, postponed its deal, citing adverse market conditions.”
“Cotton Prices Just Hit A 10-Year High. Here’s What That Means For Retailers And Consumers” (CNBC). “Cotton prices surged to a 10-year high on Friday, reaching $1.16 per pound and touching levels not seen since July 7, 2011. The price of the commodity rose roughly 6% this week, and is up 47% year to date. Analysts note that gains are being intensified further from traders rushing to cover their short positions.”
“An SEC Rule Was Meant To Protect Individual Investors. Chaos Ensued.” (Wall Street Journal). “ [A] rule from the Securities and Exchange Commission went into effect at the end of September, generally preventing brokers from providing public price quotations on securities issued by companies that don’t release current financial information…[u]nder the SEC rule, many brokers have stopped offering price quotes on…[thousands of] companies that don’t provide public information.”
“We Have No Theory Of Inflation” (Value Added). “Right now, the debate about how transitory or temporary the global spike in inflation will be is the hottest topic in macro. Between them, Goodhart and Rudd have done a good job of demonstrating that the best answer might be ‘we don’t know’. None of the existing models provide a solid basis for forecasting. Many of the people claiming that inflation is definitely staying high have been saying much the same thing for a decade or more, while many of those insisting that it is transitory failed to spot the coming spike.”
