The first step starts with you...

Author

Snowfish
May 09, 2023

Welcome back! What is one thing you learned or were challenged by last week?

I. Mindset

Last week, we introduced the difference between a fixed and growth mindset, and hopefully you had the chance to reflect on your own mindset.

 What kind of mindset do you have and what do you want to do about it?

The power to create the life you want lies within you!

We often get so caught up in our day to day lives working to pay bills and living for the weekend that we forget WE are the creators of our life experience!

The first step towards switching to a growth mindset is acknowledging that it is possible to step out of a fixed. By recognizing that change is possible, you are already on your way to a more fulfilling life.

It's time to shift your focus from what you can't do to what you can do.

I started looking at challenges in my life like levels in a game…sure I was uncomfortable at first, but I embraced the possibility of failure and more importantly analyzed my mistakes. In every career it’s the persistence of your actions that gets you to the next level.

Take athletes for instance- they don’t practice until they get it right, they practice until they can’t get it wrong!

The Process Is More Important Than the End Result

Changing your mindset requires some self-reflection

Here’s a quick practice:

  • Who or what are you spending energy on?

  • Is that giving you energy or draining your energy?

  • Identify where your energy is going and where that is leading you? Does that align towards moving closer to your goals?

  • Are there any areas that deserve more of your energy? i.e. Health, Family, Self

  • Take note of any repeating patterns

Take inventory of the people in your life - who's helping you grow and who's holding you back? Surround yourself with those who inspire you and align with your goals, and watch yourself thrive.

II. Money

Money moves through the economic system in a cycle that involves three key players: businesses, investors, and consumers. As consumers the system encourages us to spend so we should be aware of how we spend our money. Smart consumers understand this and make informed decisions about their finances by prioritizing their future.

So I know what you are thinking: How can I spend as a smart consumer? 🤔 

Here is an example of a budget breakdown for someone with a $100,000 annual salary:

  • Fixed costs: 50-60% of take-home pay, or $50,000-$60,000 per year. This includes rent/mortgage, utilities, groceries, and any recurring debt payments such as credit cards, car loans, or student loans.

  • Savings: 10% of take-home pay, or $10,000 per year. This money should be set aside as an emergency fund in case unexpected expenses arise, for future needs or wants such as a down payment on a house

  • Investments: 15% of take-home pay, or $15,000 per year. This can be used to invest in stocks, cryptocurrencies, real estate, or a business venture. Investing is a great way to grow your wealth over time.

  • Guilty pleasures: 15% of take-home pay, or $15,000 per year. This is money you can spend on whatever brings you joy, whether it's eating at different restaurants, traveling, shopping for clothes or sneakers, or enjoying a nice bottle of wine.

This setup should be seamless as your paycheck comes in set up automated transfers into the four buckets (having a seperate account for each) so that you don’t have to worry or think about it. 

Following this budget breakdown ensures that you're taking care of your fixed expenses, saving for the future, investing in your financial growth, and still enjoying some guilt-free pleasures along the way.

III. Markets

The Federal Reserve announced another 0.25% increase in interest rates, bringing their federal funds rate to 5-5.25% from 0 back in March 2022.

This decision affects both deposit accounts such as savings, money markets and credit accounts, such as mortgages, credit cards, auto loans, and student loans. The Federal Reserve has been raising interest rates in an effort to combat inflation. This week we will receive key inflation data: April’s Consumer Price Index (CPI) and Producer Price Index (PPI) both of which are expected to hold steady.

Overarching themes driving price action:

  1. Growth concerns fueled by recent economic data: April ISM Manufacturing Index

  2. Ongoing fallout in regional bank stocks

    - First Republic Bank (FRC) was seized by regulators then the FDIC facilitated a deal whereby JPMorgan Chase acquired a substantial majority of assets and assumed the deposits and certain liabilities

    - PacWest (PACW) and Western Alliance (WAL) are considering strategic options including a possible sale

  3. Debt ceiling worries- Treasury Secretary Yellen said extraordinary measures to pay the nation's bills could be exhausted as early as June 1st. President Biden will meet with House Speaker McCarthy and other Congressional leaders on May 9 to discuss the debt ceiling

  4. Uncertainty about central banks overtightening and forcing a sharper economic slowdown after the Hong Kong Monetary Authority, the Norges Bank, and the European Central Bank all raised their key lending rates by 25 basis points

Stocks to Watch

The S&P has now been flat for 2 years. In May 2021, the S&P was trading at 21.6x earnings, with FY 21 EPS expected at $190/sh. Today, the S&P is trading at 18.7x earnings, with FY 23 EPS $220/sh.

UBER which we have been watching for a couple of weeks reported Q1 (Mar) loss of $0.08 per share, $0.01 better than the S&P Capital IQ Consensus of -$0.09 Revenues rose 28.7% year/year to $8.82 bln vs the $8.71 bln S&P Capital IQ Consensus. Gross Bookings grew 19% year-over-year ("YoY") to $31.4 billion

UBER gave us a signal entry at $30.50 right before earnings and swing trade is up 26%. We also day traded $32 calls for +550%

SHOP was more of a 50/50 setup so we waited until after they reported earnings to trade it. Reported earnings beat by $0.05, beat on revs it gave us a nice signal entry the next morning at $54

SHOP gave us a signal entry at 54 the morning after reporting earnings

GOOG is trying to break through 108-110 key resistance and out of its 8 months trading range

Watching it as it’s setting up for a swing trade opportunity

*None of these stocks above are recommendations to buy, sell or trade. We do not give financial advice, you should always do your own due diligence and practice proper risk management.*

We do teach how to read charts and market sentiment weekly on Monday’s via zoom, if interested reply and we’ll send you a free invite link to check us out.

This segment is brought to you by Ceni Capital which was founded as a way to foster a community of like-minded individuals and empower them to create long term wealth by capitalizing on shorter term investments.

Be intentional about where you spend your time and energy, reflect and focus on the activities and relationships that align with your values and goals. Ask yourself would your future self approve?

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See you next week!👋

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