2Q 2018 Market Observation Newsletter

We are pleased to provide you with our Second Quarter 2018 Market Observation which shares relevant articles about the current market environment. We hope you enjoy this quarter’s edition. As always, if you have questions regarding your account or your financial planning needs, please contact us.

Nike and Adidas go head to head at the World Cup

Over the past month, much of the world has had their eyes on the pitch in Russia as 32 nations have gone head to head in the World Cup. One of the fiercest rivalries, however, isn’t between two soccer giants, but rather between the two titans of the sports apparel world, Nike and Adidas. These two companies account for more than 1/2 of the jerseys worn at the World Cup along with over 95% of the shoes worn by the top 200 players in the tournament. These articles look at the ways that these multi-billion dollar behemoths spend to battle each other.

The Guardian: Adidas and Nike go head to head at the World Cup. Who will win? Read more.

The Times: Nike and Adidas and Nike go head to head at the World Cup. Note: this link may require that you register with The Times. Read more.

New York Magazine: The Reporter Who Took Down a Unicorn

For years, Theranos was one of Silicon Valley’s hottest “unicorns” (privately held startups with valuations exceeding $1 billion). The company, which claimed to have developed a revolutionary blood test, was valued at over $10 billion at its peak. Led by a charismatic CEO, the company raised hundreds of millions of dollars from many blue-chip investors and built a board full of prominent and experienced directors. Unfortunately, Theranos’s technology was not what it claimed to be. Despite a number of high profile individuals and companies having ties to the firm, it would be a Wall Street Journal reporter located over 3,000 miles away from Silicon Valley who would identify the cracks that ultimately led to the unraveling of the Theranos story. Read more.

Bloomberg Businessweek: Keeping Up With the Joneses: Neighbors of Lottery Winners Are More Likely to Go Bankrupt

Many of us have heard the apocryphal stories about lottery winners who have managed to blow through a massive jackpot and wind up in bankruptcy. However, a lesser known phenomenon might be when the neighbors of smaller lottery winners see an increase in bankruptcies despite not seeing any personal windfall. This article looks at a Federal Reserve Bank of Philadelphia study, which found that seeing a neighbor experience an increase in wealth led some individuals to increase their own spending and take more risks with their investments and savings. While it’s probably not healthy to root against the fortunes of our friends and neighbors, the study does highlight the importance of making the right financial decision for our own personal circumstances, rather than making decision that we think will help us “keep up with the Joneses.” Read more.