April 29, 2022

Today's Topics

Hi! We have 3 charts for you today exploring:

  • Real world retail. Brick and mortar is making a comeback.
  • Perspective. Big tech has lost ground this year, but it's still huge.
  • Student debt. Biden has a big decision to make.
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Real world retail

Few companies benefited from the pandemic as much as Amazon. Online sales soared and many wondered whether brick and mortar retail would recover.Well, it has.For a company that's been used to growing at 20%, 30% or even 40% over the last few years, yesterday's update was something of a shock: Amazon's e-commerce sales dropped by 3% and the company reported its first loss for 7 years.

Evidence from the UK

If you happen to have a keen eye on UK retail sales (who doesn't?) you might have seen this phenomenon coming. The UK has monthly data on internet sales as a % of total retail — and it's showed an interesting trend recently.

After years of gently trending higher, online sales shot to more than 35% of total UK retail sales during the pandemic, where many experts expected them to stay, as we adopted new habits permanently.

But in recent months online sales have pulled back. In fact, if you draw the trend line on the data pre-pandemic then online sales are not far off where they might have ended up anyway, had the pandemic never happened in a glorious alternative timeline. The quarterly data in the US shows a similar trend. Maybe we don't want to buy everything online after all.

Amazon isn't the only big tech company that's having a slightly tougher year (don't cry just yet).

As of yesterday the 7 stocks that make up our newest big tech acronym — MAATMAN* — had shed almost $2.1 trillion of equity value since the start of the year (Amazon is losing another ~$150bn at the time of writing). That's a loss in value that would have been unthinkable for 7 stocks to lose even just a few years ago — but even with that loss it's worth reminding ourselves just how big big tech still is:

  • Apple alone is worth 9x Coca-Cola, 14x Nike, 25x Target, 30x Netflix or 42x Uber.
  • Meta has lost the approximate value of a JPMorgan Chase or 8 Twitters, just this year.
  • Tesla remains more valuable than the next 15 automakers in the world... combined.

Welcome NVIDIA

For a long time Netflix was a key member of many a tech acronym. From FANG to FAATMAN, Netflix's rise to a $250bn+ valuation kept it a part of the big tech conversation for many years. However, in strict financial terms it hasn't really been in the same league as the others for a while. Enter NVIDIA, the maker of graphics processing units (GPUs) and other computer hardware that has quietly grown into America's 8th most valuable company.

*MAATMAN is Microsoft, Apple, Alphabet, Tesla, Meta, Amazon and NVIDIA.

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Cancel culture

President Biden has a big decision on his hands: what to do about student loans. Biden is under mounting pressure from his party to forgive or cancel billions, or even trillions, of dollars worth of student loans — a debt that in 2003 was roughly one-third the size of credit card debt, but has ballooned to be almost twice as big in less than 20 years.

So far borrowers have been given a pass for much of the pandemic, with payments (and crucially interest on the loans) having been paused for more than 2 years. The latest pause on payments is set to last until August 31st.

Biden has ruled out the $50k per person forgiveness some are calling for, yesterday saying that he would reach a decision on student debt "within a month".

Inflation is... good?

If you owe a terrifying amount in student loans, you may actually be happy about inflation. With interest paused on the loans higher inflation is actually eroding the principal value of your debt.

More Data

1) Many of you loved the divergent word test, now we present the how random are you test, from our friends at The Pudding, who are trying to replicate a randomness study.

2) The US economy contracted in the first quarter of the year, with GDP falling 1.4% at an annualized pace. Stock markets looked through the report, with US stocks rising2.5% yesterday.

3) Roboticists have built a device capable of jumping more than 100x its own height in the air.

4) Shares in Robinhood are down double-digits after reporting that revenue had fallen a staggering 43% in its latest quarter.

5) In the past, you could only buy shares of companies like Apple, but with this new platform, you can unlock the world of art with fractional ownership — and Chartr subscribers get priority access.**

6) In 2015 there just 6 earthquakes that topped 3.0 on the Richter scale in Texas. Last year there were 181, as the oil fracking boom in the Permian Basin has made earthquakes more likely.

7) The best marathon times, plotted by age and split by gender.

**This is sponsored content.

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