Markets: A day after the Fed boosted its projection for economic growth this year, stocks sank and the yield on the 10-year Treasury note climbed to 1.7% for the first time since January 2020.
Covid: Major European countries including France and Germany will restart administering AstraZeneca's Covid-19 vaccine after the EU's drug regulatory agency said that it was safe and effective. More than a dozen countries had suspended use following concerns over blood clots.
#FINANCE
Goldman Sachs Finds Out How Much Is Too Much
Goldman Sachs bankers have become a little too familiar with their Zoom reflection.
In a survey circulated to managers, 13 analysts in Goldman's investment banking division reported sharply deteriorating mental and physical health from working almost 100 hours/week in what one described as "inhumane" conditions.
They asked managers to cap their hours at 80/week, allow more time to prepare for client and team meetings, and guarantee Friday nights and Saturdays off (unless there's a pre-approved exception).
If conditions don't improve, analysts said there's only a 35% chance they'll still be at Goldman in six months.
A spokesperson said the bank is listening and trying to address concerns, including by hiring more junior bankers and transferring some employees to help. But execs probably don't want to address the root problem.
Business is reallllly good
Wall Streeters know they're accepting heavy workloads in exchange for a salary that keeps their seat warm at Nobu. But the recent explosion in dealmaking has been more than some bargained for.
The global IPO market has had a record Q1, with 600+ issuers raising over $162 billion, according to Bloomberg. And you already know what's driving it.
SPACs. IPOs of special purpose acquisition companies have raised over $83 billion this quarter, eclipsing 2020’s entire haul. As a leading merger advisor, Goldman is raking in business. It's advised 32 SPACs in Q1 for $9.2 billion in proceeds, according to Refinitiv data. Only Citigroup's got it beat with 56 SPAC IPOs for $10.5 billion.
CFO Stephen Scherr says Goldman's deals backlog is at a record high. In the market, over 400 SPACs with $131 billion in cash are looking for companies to merge with.
Zoom out: As SPACs continue to IPO with huge valuations, analysts are worried about market "indigestion." Shorts against SPACs have more than tripled since the start of the year to $2.8 billion, according to data from S3. And the SEC recently warned investors to treat celebrities' SPACs with the same skepticism as their Proactiv commercials.
ALEZ HICKEY
#SPORTS
Thinking About the NFL's New TV Deal
The NFL just announced new media rights deals that make the Patriots’ free agency spending spree seem like a trip to Nordstrom Rack.
The league will nearly double its media revenues to a reported $113 billion over 11 seasons, flexing its position as the undisputed king of the TV castle. The new deals will start up in 2023.
The details: Several of the NFL’s media partners (including CBS and NBC) will keep their current schedule. But there are some important changes.
Amazon gained exclusive rights to broadcast Thursday Night Football on its Prime Video service. It’s the first time a streaming service has been granted an exclusive package of NFL games.
Disney’s ABC notched a few more games, including the biggest one of all: It’ll be included in the rotation to air the Super Bowl.
Zoom out: “The new contracts show the balance the league is trying to strike by embracing digital platforms, as younger audiences migrate to them, without alienating fans used to watching games on TV,” writes the WSJ. NFL viewership declined 7% last season.
NEAL FREYMAN
#SUPPLY-CHAIN
Supply Chains Need a Factory Reset
at precisely the moment when they're required.
Like your social skills, that system is completely out of whack right now, reports the WSJ.
You know about the pandemic-induced chip shortage—but manufacturers are also lacking other materials. This week, Toyota and Honda said they're cutting production in North America because they don’t have enough petrochemicals.
The deep freeze that hit Texas in February knocked many chemical plants out of commission, and they won't be fully firing again for at least a few months.
Without chemicals, it's hard to create plastic. Now, a plastic shortage is causing headaches for companies making smartphones, medical equipment, and siding for houses.
Got room for one more? How about a wood shortage. Demand for lumber by home builders has outstripped supply to the point where prices have shot up more than 180% since last spring.
Bottom line: There isn't one primary driver of supply chain chaos—it's simply a series of unfortunate events.
NEAL FREYMAN