The Wolf Den #629 - Apple Wants All Of The Pie
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In This Issue:
Apple Wants All Of The Pie
Bitcoin Thoughts And Analysis
Legacy Markets
Opinions Are Like Assholes - Everybody Has One
The Pentagon Failed Another Audit
Blackstone Real Estate Group Halts Withdrawals
Did SBF Tell The Truth? Mario Nawfal, Tiffany Fong, Dave Weisberger & Joshua Frank
My Recommended Platforms And Tools
Apple Wants All Of The Pie
Apple has been no stranger to controversy.
The recent round of criticism was sparked by Elon Musk, who focused on the following 5 points, as shared by NDTV.
Tensions began after Mr Musk acquired Twitter and promised to allow "free speech" on the platform. With the tweets targeting Apple, he appears to confirm that content moderation was an issue for the iPhone maker. Lack of moderation could give Apple a ground to remove Twitter from its app store - something the company did with Parler last year.
Another issue is Apple's 30 per cent fee, which the company takes from all digital content purchased on its app store. Mr Musk has openly criticized his "secret tax" multiple times in the past. Apple's store fee has also been criticized by Spotify and Meta.
Mr Musk has also claimed that Apple has mostly stopped advertising on Twitter. He tweeted: "Apple has mostly stopped advertising on Twitter. Do they hate free speech in America?" The billionaire then tagged Apple's CEO, Tim Cook, asking "what's going on here". Ad sales account for about 90% of Twitter's revenue. A Washington Post report said that Apple was the top advertiser on Twitter, spending $48 million on ads on the social network in the first quarter of 2022.
Mr Musk, a self-described "free speech absolutist", has alarmed advertisers who are concerned that his acquisition of Twitter will lead to proliferation of hate speech on the platform. Many big companies, including General Motors and Chipotle, have paused spending on Twitter, according to The Guardian.
After becoming the "Chief Twit" of the platform, Mr Musk announced general amnesty for permanently suspended accounts, which could see the return of Steve Bannon, the former Donald Trump adviser, and Katie Hopkins.
It should comes as no surprise that companies are pushing back, once again, against the 30% app store fee. Apple has found itself going head to head in the past with Epic Games, Wordpress and Coinbase, goliaths in their respective industries who were all unintimidated by Apple’s egregious demands.
The controversy resulted in lawsuits, gamers fighting back, and settlements out of court. Apple was overstepping boundaries by committing antitrust law violations. Yet somehow, they haven’t stopped.
I bet you think this intro is about Elon Musk and twitter, but it's not.
It is about the feud between Apple and Coinbase. It started in 2020, when Brian Armstrong went public with Apple’s unreasonable demands and the challenges it was causing his company.
Armstrong stated that negotiations “hit a dead end,” and that Apple was “holding back progress in the world.” Apple made Coinbase users jump through endless hoops in the app store, especially when users were looking to use Coinbase Earn or to view Coinbase's recommendations of DeFi sites and services.
Participants in the Coinbase Earn product get free tokens for learning about crypto. This is not a yield product, but rather a platform that incentivizes education. It is a win-win.
Apple really hates when people earn money and they don't, so they forced users to navigate through a maze to use Coinbase Earn. Brian Armstrong posited that it may have to do with Apple Pay, a Coinbase competitor.
This bring us to today, and it’s all about the Benjamins.
Major companies have quietly been forced to pay 30% of their earnings to Apple, which is far higher than fees charged by other providers. Smaller companies have been left with no choice but to pay-the-price or risk losing their business.
Yesterday, Apple made a change to their app store policy that effectively rendered NFT transfers through the Coinbase Wallet obsolete.
Apple wants their piece of the NFT pie, which includes a 30% cut of the gas fees. Anyone with an inkling of knowledge about crypto understand that this is absurd and impossible. As Coinbase puts it, “this is akin to Apple trying to take a cut of fees for every email that gets sent over open Internet protocols.”
Apple’s In-App purchase system doesn't even support crypto payments.
If this policy stands, then what crypto platforms will be targeted next?
This certainly isn't the end for NFTs, but it is the beginning of a battle for control between decentralized platforms and legacy systems. This is why crypto was created in the first place.
Will public dissatisfaction be enough to change Apple’s tune?
Epic Games defied Apple. The result? Fortnite is no longer in the App Store.
It is one thing to mess with gamers, but another to alienate the tough-as-nails crypto community which will only grow more powerful in the future.
Apple needs to do the right thing, both for the community and for the future of their business.
Bitcoin Thoughts And Analysis
DAILY CHART
Here is your short term Bitcoin analysis.
>$17,592 = good
< $17,592 = bad
There you have it.
Legacy Markets
"Global stocks reflected a cautious mood on Friday, steadying after recent sharp gains as traders awaited the monthly US jobs report for clues on the Federal Reserve’s next policy steps.
Stocks got a boost this week from a softening in China’s stringent Covid zero stance and signals from Fed Chair Jerome Powell of a downshift in the pace of rate hikes. Bets on where the US central bank’s rate will peak have now dropped below 4.9%, according to swap markets. The current benchmark sits in a range between 3.75% and 4%.
However, many economists reckon Friday’s employment report may fall short of the turning point Fed officials are seeking in their battle to beat back inflation. The median projection in a Bloomberg survey calls for payrolls to rise 200,000 in November, cooling only slightly from the previous month.
Others point to signs that steep rate hikes will tip more economies into recession.
“Consensus is that recession is coming but equities cannot bottom before it starts, inflation won’t fall quickly so central banks can’t blink, China reopening will be a messy process, and Europe remains tricky,” Barclays Plc strategist Emmanuel Cau wrote in a note.
Key events this week:
US unemployment, nonfarm payrolls, Friday
Some of the main moves in markets:
Stocks
The Stoxx Europe 600 was little changed as of 10:25 a.m. London time
Futures on the S&P 500 were little changed
Futures on the Nasdaq 100 fell 0.1%
Futures on the Dow Jones Industrial Average were little changed
The MSCI Asia Pacific Index fell 0.5%
The MSCI Emerging Markets Index fell 0.4%
Currencies
The Bloomberg Dollar Spot Index fell 0.2%
The euro was little changed at $1.0525
The Japanese yen rose 0.9% to 134.14 per dollar
The offshore yuan rose 0.3% to 7.0172 per dollar
The British pound rose 0.2% to $1.2267
Cryptocurrencies
Bitcoin rose 0.2% to $16,967.65
Ether rose 0.2% to $1,279.26
Bonds
The yield on 10-year Treasuries advanced two basis points to 3.52%
Germany’s 10-year yield declined three basis points to 1.78%
Britain’s 10-year yield declined two basis points to 3.08%
Commodities
Brent crude was little changed
Spot gold was little changed"
DXY (DOLLAR INDEX)
I drew a circle a few weeks ago, so that means price has to go there.
Just kidding, complete luck that one of my black circles is once again being targeted, but the idea was obviously correct - that the dollar was topping for a bit and that the 103 area was natural for a retrace.
Dollar weakness = asset strength. What you are seeing here is the reason for the renewed run in stocks and other asset classes. If not for FTX, crypto would have likely enjoyed a serious upside move over the past few weeks as well.
Now let's hope that 103 hits... and then breaks down.
Opinions Are Like Assholes - Everybody Has One
SBF has reemerged for an attempted redemption tour, explaining himself to anyone who will listen.
There are people, like Bill Ackman and Kevin O'Leary, who believe that Sam is telling the truth and simply was unaware of the fraudulent behavior at FTX.
Others believe that Sam is acting on strict instructions from a very talented legal team, saying specific things to deflect from the crimes he committed. He is guilty, but strategically playing dumb.
A growing number of people believe that Sam guilty, but believe Sam is giving his best attempt to explain the situation.
It is hard to tell.
There is zero question in my mind that SBF is guilty of massive fraud, whether "intentional" or because of a series of snowballing bad decisions. His comments and answers have been inconsistent and nonsensical at times, so it is hard to believe anything he has to say.
The most important fact is that his actions led to billions in losses for customers. Supporting that behavior is placing yourself on the wrong side of history.
The Pentagon Failed Another Audit
You think that crypto exchanges are poor at accounting?
The Pentagon has never passed an audit. Ever.
When asked about the audit, the Department of Defense comptroller, Mike McCord said, “he doesn’t believe they flunked.” This is dumbfounding, considering the fact that only 39% of assets were accounted for.
The defense agency boasts $3.5 trillion in assets and should land a budget over $700B for 2023. The DoD is on track to have a trillion dollar budget within 5 years, yet they can't even organize their books.
Seems like this would be a better place to start for saving money then hiring 87,000 IRS agents to go after the little guy.
Blackstone Real Estate Group Halts Withdrawals
The $125B private equity real estate investment fund decided to halt withdrawals after a flood of redemption requests poured in. Does this sound familiar? Clearly the crypto industry is not the only one in distress.
Considering the nature of real estate, it makes sense that these assets would be illiquid. But this is still bad news. Only 43% of redemption requests were approved in November. Now that withdrawals are paused, that number will be 0%.
Misery loves company. Nobody wants to see the real estate market collapse. Well, except maybe Jerome Powell...
Did SBF Tell The Truth? Mario Nawfal, Tiffany Fong, Dave Weisberger & Joshua Frank
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The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this e-mail constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.
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