Charts of the Month - September '23
The Big 7 vs. The Old Guard, The U.S. Consumer - Not Dead Yet, and The Dirtiest Cities in the World
US Budget, Netflix vs. Disney, Streaming Services, Owners of US Debt, Patagonia Supply Chains, Apple's Cash Hoard
Lex Fridman put out this tweet the other day that got me wondering “How many people actually know how their tax dollars are spent?”
My guess is very few, so I decided to peel it back a bit, and, as expected, the US government did not disappoint.
I’ll keep this brief otherwise it could turn into a full on rage against the machine editorial.
If you were analyzing a company, trying to understand its current state of operations and forecast its future state, you’d look at how it’s spending its capital.
Is it buying new productive assets that will generate future economic gains? What percentage of its total spend is for servicing its current state vs. its future state? What are the weak points the business needs to shore up and what are its strengths that it can leverage?
Analyzing a country isn’t much different.
A few highlights, but feel free to interpret however you’d like:
You can dissect this budget myriad of ways, and some might be fairer comparisons than others, but the key takeaway, in my opinion at least, is that the country is spending far too much on ‘servicing the past’ as opposed to ‘investing for the future’. In corporate speak, too much Opex and Overhead, not enough CapEx.
So, there you go Lex – hope this helps you sleep at night. (If anyone actually knows Lex please forward this to him.)
If you don’t spend most of your life on Twitter (I envy you) you may have missed the massive sell-off in Netflix stock after they released Q1 earnings and announced that they lost subscribers for the first time in over a decade.
As of today, the stock is down 43% since immediately before the release – wiping out ~$67 billion in shareholder value overnight ($400 million of the loss was just Bill Ackman’s fund, in case you think you’re having a bad day).
Was this an overreaction?