BWIB Finance Newsletter

Tesla invests $1.5B in Bitcoin

Source: WSJ

● Elon Musk aims to use the cryptocurrency as a form of payment for Tesla’s products soon. Bitcoin’s price soared over 10% after the announcement.

● The move reflects a growing interest in using cryptocurrencies as a form of payment for everyday purchases.

● Hurdles remain over integrating Bitcoin and other cryptocurrencies as everyday payments due to the high transaction cost and volatile nature of the asset.

Clover Health’s business practices scrutinized by short seller’s report

Source: ​Hindenburg

● Hindenburg Research, a short-selling firm, accused Clover Health of misleading investors, including hiding an active investigation by the DOJ into the company's business practices.

● Clover Health is a healthcare company that sells Medicare Advantage plans. It went public via a reverse merger last October with venture capitalist Chamath Palihapitiya’s SPAC.

● This report has spurred an inquiry into Clover Health by the SEC

Research Oil prices surge in response to production cuts and increasing demand

Source: ​WSJ

● Brent crude futures have increased 50% since October and are approaching pre-Covidprices- $60 a barrel.

● OPEC and Russia have cut production in order to tighten oil supply, which increases the price of oil.

● Stockpiles of oil from the start of the pandemic have also depleted earlier than expected, reflecting the increase in demand and anticipated economic stimulus.

Mergers and Acquisitions

● Uber is acquiring Drizly an alcohol-delivery service to integrate within its UberEats app (Source: ​WSJ​)

● Electronic Arts (EA) will acquire mobile video game publisher Glu Mobile in June for $2.4 B in cash (Source: ​Barron’s​)

● DoorDash is acquiring Chowbotics, a meal-prep startup that automates food production. Terms of the deal weren’t disclosed, but Chowbotics was last valued at $46 MM in 2018(Source: ​WSJ​)

Government

● The Biden Administration wants to raise the federal minimum wage to $15/hour in hopes of improving the living standards of workers (Source: ​WSJ)

● Democrats want to offer $1,400/person stimulus checks and $400/week unemployment insurance through August at the same income levels of the last 2 rounds of stimulus (Source: ​WSJ​)

Litigation

● Consulting firm McKinsey & Co. agreed to pay a $573 MM settlement for its part in the opioid crisis. The firm pushed opioid makers to aggressively market their painkillers. (Source: ​WSJ​)

● The family of the 20-year-old trader who committed suicide last summer sued Robinhood for wrongful death. The trader thought he had a huge negative cash balance in his account, leading him to commit suicide (Source: ​CNBC​)

Changes in Leadership

● Jeff Bezos will be stepping down as CEO of Amazon in Q3 to become executive chairman; AWS CEO Andy Jassy will replace Bezos (Source: ​The Verge​)

● Kenneth Fraizer, CEO of Merck & Co., will be retiring at the end of June; CFO Robert Davis is slated to replace him (Source: ​WSJ​)

● David Wichmann, CEO of UnitedHealth Group, abruptly retired last Thursday; the company's president Andrew Witty succeeded him (Source: ​WSJ​)

Written By:

Director: Jacquline Ruan

Managers: Vaibhavi Bamane, Melissa Chen, Stacy Kim