The Best One Yet - “FOMOcoin” — Bitcoin’s FOMO-mentum. Bath & Body Works’ zen profit. Roblox’s tween stock.

Episode Date: January 8, 2021

Bitcoin doesn’t usually give us a reason for doing what it’s doing, but we’re breaking down its surge to $40K (spoiler: FOMO). Victoria’s Secret needs to change its name to Bath & Body Works. And Roblox’s tween gaming is going public for 12-year-olds.$RBLX $BTC $LBGot a SnackFact? Tweet it @RobinhoodSnacks @TBOYJack @NickOfNewYorkWant a shoutout on the pod? Fill out this form:https://forms.gle/KhUAo31xmkSdeynD9Learn more about your ad choices. Visit podcastchoices.com/adchoices Hosted on Acast. See acast.com/privacy for more information.

This is Nick. This is Jack. And this is Snacks Daily. It is Friday, the real Friday, January 8th. A bunch of White House cabinet resignations yesterday. Yes, Jack. As well as chat are about invoking the 25th Amendment. Adding it all up. Or impeaching the president. None of that. Nope. Affected stocks yesterday. Neither did the attempted insurrection from two days ago, which is absurd. Investors think this insanely terrible political moment we're experiencing the U.S., it's not going to affect long-term stock prices. Hoping it's just a moment. And And we made this the best one yet. For our first story, Bitcoin has hit $40,000.

And crypto, that's hit a trillion dollars. Yeah, Jack, it's just like Uncle Bernard promised over Thanksgiving. Four years in a row. I betania, this is going to go. Love you, Uncle Bernard, but what are you talking about? Second story, Jack. We've heard of Victoria's Secret, the company, right? Yeah, you've heard of Victoria's Secret.

Time to rename itself Bath and Body Works. Bold name, new name. For our third and final story, Roblox is a soon-to-be, publicly traded game company with one big differentiator. Get this, Snackers. They found a way to get someone else to make their content. And that someone else is in fifth grade. Probably Uncle Bernard's son. Probably Uncle Bernardson. But Snackers, before we jump into that wonderful mix of stories,

Jack and I kind of mentioned this yesterday, but we did find this wild story about the CIA. We teased you that the CIA got a rebrand. You should go to cia.gov and check this out. Yeah, honestly, the old website kind of looked like the Library of Congress helped the main character from Homeland, start a MySpace blog. The new website's a little different. It looks like a direct-to-consumer startup that definitely is based in Dumbo, Brooklyn. Absolutely. Jack and I dove in snack style. This whole new CIA website, it is literally just black and white with lovely San Sera font sprinkled over the whole thing. I swear there's a promo code on a podcast somewhere I can use on this website. Feels like they're about to drop one. By the way, you get one plant-based spy. It's going to cost you $95.

But Nick, if you subscribe to monthly refills for these spies, it'll save you $5 per kill. Jack and I check this out. The first spy shown on the website, he literally looks like a barista in Portland, Oregon, judging your latte. We're just impressed by the VC money, apparently behind the CIA now. But Snackers, there is actually a purpose here behind the CIA rebranding their website to look like a direct-to-consumer razor company. That's correct.

Most agents at the Central Intelligence Agency are white dudes. They need to diversify their spies. So Snackers, here's what Jack and I are thinking. Are you graduating from college? Are you light-footed? Do you want to serve your country? Look out for a TikTok ad for a delightful entry-level espionage position at the CIA. Or just go to CIA.com, but this is not an ad.

Or is it an ad? Let's in our three stories. You're tuned in the snacks daily. We spoke to the lawyers and we got to get something legal out the way. The snacks about to hear ain't food. It's air candy. They don't reflect the views of the robberhood family. It's all living.

informational just so you know we're not recommending any securities nope it's not a research report or investment advice not an offer or sale of a security right snacks is digestible business news for you robberhood financial LLC member fenra slash sipc for our first story the two biggest numbers of the day jack the first one bitcoin hit forty thousand dollars the second one all the cryptocurrency in the world overall has reached a $1 trillion worth of valuation. I know you're thinking, Jack. I know you're thinking. Do we have to talk about Ben? Do we have to talk about him? Is it too soon?

It's a little soon. Is it too soon to talk about it? It's a little awkward for me. I mean, Ben the Bitcoin, he's no longer with us. What can I say? Ben the Bitcoin. He's one of the departed. One of the departed as of two months ago. But in the meantime, Snackers, Bitcoin kind of does its own thing. It's the Tyrion Lannister of financial assets.

Yeah, it is. It's Bitcoin being Bitcoin. It's the April Ludgate. April Ludgate over in the crypto. world doing her own thing. Now, Bitcoin's been a digital currency since way back in 2009, but its first real, like, convulsion on the pop culture scene, 2017. Three years ago, the price of one Bitcoin jumped from $2,000 to nearly $20,000 in just three months. Yeah, we all know how this went down because, like, the PFWTM in this situation was your cousins, co-workers, Dorman's yogi's friend who said Bitcoin while at the table next door.

So many of my brother's friends texted me. asking if they should buy Bitcoin, it was very annoying. So Bitcoin surged to 20,000. Ten months later, Bitcoin had fallen nearly 90% all the way back to $3,000. And then for like three years, it did not much. That surge three years ago, that was because of one thing, Jack and I like to call it, retail investor FOMA. Small investors like you and me, they saw the price of Bitcoin rising and they wanted to get on that rocket chip and they didn't want to miss out. Didn't want to miss out. FOMA, by the way, our buddy Patrick McGinnis invented it. Great term. Unfortunately, for three years ago, it was a classic bubble.

Momentum got some investors on board who talked about it with their buddies, which got more investors on board than more than more, shooting the price way up. It was great until it popped. It was like Bitcoin was famous for being famous, classic Kardashian coin situation. The pop, though, and the plummet was even worse than the rise on the other side. Here's the thing, Snackers. That was rally number one. But three years later, we're now in the middle of the second rally.

Valley number two. Snackers, Bitcoin, not Ben. We're not talking about Ben here. No, we're not. In fact, we're not going to mention Ben another time this story. No, we're not, Jack. Bitcoin has quadrupled in price in just the past couple months from $10,000 per coin to $40,000 yesterday. And the crypto market in its entirety is now worth over a trillion dollars. Now, there's a few probable reasons for Bitcoin spiking so much, but the main reason is this. The first rally was all about small investor FOMO, but the second rally is all about big investor FOMO. Retail FOMO three years ago, corporate FOMO today. For example, Square, the payment processing company, they just bought $50 million of Bitcoin just in October. A famous hedge fund run by a man named

Paul Jones has had 2% of all of their assets is now in Bitcoin. And Boston favorite Fidelity is now accepting Bitcoin as collateral for loans. Oh, I'll tell you, I'm good for it. I got Bitcoin in the back. So, Jack, what's the takeaway for our buddies over in Bitcoin? Bitcoin has one main superpower, and that is anti-inflation. All right, Snackis, you can't drop a fraction of a Bitcoin to pay for a smoothie right now. And it's probably like a little too volatile for your mom. And just like the retail FOMO rally of three years ago, this corporate FOMO rally, that could pop and crash and plummet as well. Yeah, keep in mind, I mean, Jack and I were just saying in 2017, the value of Bitcoin crashed by almost 90% right after a jump like this. If you bought at the top of that bubble,

you experienced a lot of pain in the next two months. But there is a fascinating real value in Bitcoin right now, which isn't as a currency, but actually just to protect against inflation. Snackers, because of the global pandemic, governments across the world are printing money to pay for stimulus packages to rescue the economy. So we got cash flowing into the financial system,

all in hopes of juicing up the economy right now. All that new cash, though, could dilute away the value of the money in that country. That's the inflation when like a $1.00 could eventually cost you $2 because your money is actually worth less because there's too much money out there. Now, inflation, like Nick just described with the oranges and the dollars, that is not possible with Bitcoin because there are a finite number of Bitcoin

that could ever be mined in this earth. So similar to gold, the protection against inflation is Bitcoin's superpower. We think that's why corporations and institutions are buying Bitcoin right now. Corporate Foma. for our second story, Roblox makes video games differently. Roblox just decided to take their stock public differently.

Differently. Jack, a little trivia for you over here. What app consumes the most time from the average user and pretend you didn't hear what we just said? Yeah, this is a classic leading answer to a trivia question. Yeah, it's not Instagram, it's not TikTok, it's not Snapchat. Roblox. The 31 million people who play Roblox every day play for two and a half hours per day. By the way, Snackers, classic Jack Kramer trivia question over here. He always asked me a trivia question, and I'm like, is the answer in New York?

And he's like, it is. The answer is New York. Of course. If I ever ask you a trivia question, guess your hometown, you're probably going to be right. That's going to be the answer. Spoiler alert. Snackers, Roblox is founded in 2004. It's not just games, though.

It's a gaming platform. Right. There's game developers on one side of Roblox and video game players on the other side. Now, here's what Jack and I find fascinating about Roblox. What sets Roblox apart from all the other gaming stocks out there, and there are plenty, the customer. Nick, did you play Roller Coaster Tycoon, the awesome computer game when you were a kid? Jack, I was the roller coaster tycoon. Now, if you were building your own theme park, you might have been actually outside building

like an igloo with the snow in the driveway like me in Vermont. That sounds scary. But the average fifth grader today is building theme parks and Igloo Playlands, but they're doing it on their phone and they're doing it with Roblox. Get this Snacker, 75% of American children between 9 and 12 years old, they play Roblox. It is very popular. Jack, I'm sorry, I just had to sit down, stand up, and sit back down again. 75% of 9 to 12 year olds in the United States play on this platform, Roblox.

Now, let's talk about the economics of video gaming. It's expensive. Yeah, it is. The latest call-of-duty game cost, Activision, the company that, made it, like $50 million to develop. And here's what's wild about Roblox. Jack and I notice they basically get their games for free. Here's how it goes down.

A player will download Roblox and then pay for Robux. Nice name. Which is the digital currency of Roblox for in-game transactions. Now, a third of that revenue for like buying stuff for these in-game buys, a third of that revenue goes to the developer who created the game. So Roblox doesn't pay the developer for creating an awesome game on their platform. they just give them a cut of the revenues that that game creates. Now, this company hasn't enjoyed any profits yet,

but this whole situation with the young customers and the not paying for its own games, that's got it from a $4 billion a year ago to $30 billion today. Two and a half hours a day for 31 million people. Wow. So, Jack, what's the takeaway for our buddies over at Roblox? Roblox is going public just as IPOs are becoming an endangered species.

Honestly, Jack, Roblox is. It has patience. They've been gaming since like 2004, 17 years now. They filed to IPO finally in November, and then they had a two-week wait period before actually doing it. And here's the funny thing. During that two-week wait period, they watched Airbnb IPO,

and then they watched DoorDash IPO, and then they watched both experience the double-double. Both of those company's stock prices doubled when they IPOed, and then doubled again on the first day of trading. The double-double sounds good for your stock. It does. It sounds really good. Sounds like you'd order this thing at Friendlies. But that was actually bad for those companies because they sold new stock to investors for way

less than that stock was trading just a day later. Now, seeing Airbnb and DoorDash miss out, Roblox decided to cancel their IPO and they finally announced yesterday they're going to direct list instead of an IPO. So they're still going to be public. They're just doing it in a different way. And this way they can avoid the costly investment banking fees and avoid the dilution of stock value that like all the... recent IPO's experience. In the next couple weeks when Roblox finally goes public and their stock

begins trading, we got one message for your Roblox. Gigi Roblox. Gigi. For our third and final story, Victoria's Secret stock jumps 6% because it's got a secret. This story's actually not about Victoria's Secret, but the company is the comeback story of 2020. By the way, Jack, we've never spoken about this, but Columbus, Ohio is America's shopping mall city. It's incredible. It's both a shopping mall and a city because it's the headquarters of Abercrombie and Fitch, Wendy's, and Express, which are all in like the south wing of my local mall. It's also got DSW shoe warehouse. It doesn't have Auntie Ann's pretzels, which is fantastic.

It also has a company called L Brands. And this company, L Brands, happens to own Victoria's Secret and another company called Bath and Body Works. We've reported on L Brands back in March. Its market value had recently fallen from $29 billion, when Victoria's Secret push-up bras were a thing, to $6 billion when everyone was rocking brawets. The CEO also got kicked out. He was connected to Jeffrey Epstein. He was the founder of the company. He was awkwardly a very old white guy who was controlling young women's underwear, so not a great luck. It was awkward. And then Victoria's Secret was supposed to be sold off, but then the buyer backed

out because of the pandemic. So 2020 started really badly for L brands, and yet the stock has quadrupled in the past year and is now at a three-year high. That's right. It's at a three-year high, but it's all thanks. Not to Victoria's Secret. It's thanks to soap. Bath and Body Works. That is the home of the coconut lime-breeze soap candle, and it's part of Albrands. Can't get enough of that stuff. Vicky gets all the attention. Victoria's Secret was always the focus of investors. But Bath and Body Works is chugging along at nine straight years of annual growth jack. Victoria's Secret is the Boromir of the family. It gets all of dad's attention, all of dad's love, and it's like the prettier of the two siblings. Jack, are you going to say that Bath and Beyond is the Faramere in this

situation? Faramir, a great company trying to save Gondor, getting decent process, steady growth, but no love from the parent company. And Jack and I noticed Bath and Body Works, it's kind of found itself a nice little profit puppy. Absurd selling sense. Bath and Body Works, self-care and cozy products to just make you feel good at home. They're selling really well during the pandemic, and one of their products smells like a French bag at and sign me up for that. So in Columbus, Ohio, please sign Jack up for something right now. Bath and Body Works sales surged 70% during the all-crucial holiday quarter. That was huge for Elbrands. Meanwhile, Victoria's Secret continues to not carry their own weight.

Sales dropped by 9% compared to last year. So, Jack, what's the takeaway for our buddies over at Lbrands? The greatest unlocked value at Lbrands is changing. its name. All right, Jack, so we keep talking about home splurging. The trend of the pandemic. May not stay. It's kind of expensive. It gets expensive. A house is expensive, but a small treat to make your house nicer or your apartment for that matter, like a luxurious bath mat. That could continue beyond the pandemic. And right now, Lbrand's the company, the name, it means nothing. Elbrand's is, what would you call it, Jack? It's a soulless, faceless, corporate blank. It's a corporate blank. And

it's too associated with Victoria's Secret. Giselle doesn't even want to be associated with Victoria's Secret. So we think L Brands, the corporation, should embrace the name Bath and Body Works. That should be the new you, L Brands. It's so you. It's unlocked value in the stock simply by rebranding to your future core business. If L brands change the name to Bath and Body Works, that could attract retail investors to buy the stock because they love the brand Bath and Body Works. And signal to professional investors, hey, the future is aromatic. And stop being a corporate soulless blank. And sign Jack up.

Jack, can you whip up the takeaways for us before the weekend? Bitcoin was $10,000 in October, $40,000 yesterday. It's superpower impervious to inflation. For our second story, Roblox has struck platform gold. Oh, yeah. It lets someone else make the games for free. Can we say this for a third time, Jack? 75% of 9 to 12 year olds in the United States, they're playing Roblox.

What's going on with that 25%? Are they building igloos in the driveway like me? What are the 8-year-olds waiting for? For a third and final story. Elbrand's identity has been defined by Victoria's Secret. Guys, change the name to Bath and Body Works already. The better performing child than the family. Just do it.

Now, time for our snack fact of the day. This one sent in by a legendary snacker, a brown bear, and award night. Mike Lemons from a lovely Washington, D.C. And a St. Albanser. Am I right? I believe that's correct, Jack. I believe that's correct. We can confirm that.

Now, according to our buddy, Mike, the average homo sapien has 100,000 hairs on their head. We're just going to leave it at that, Mike. Thanks for that one. Snackers, we loved being with you this week. It was cathartic for Jack and I to be with you this week. It's one of those weeks where I feel incredibly proud

and grateful for what I get to do for a little. Jack, I love doing this pod with you. I love it. And Snackers, thanks for your incredible tweets and Instagram messages. It meant a lot to us yesterday. We cannot wait to see you on Monday. Let's do it. And before we go, Snackers, big congratulations to Andrew Caplo. He made his first stock market investment over in Medford, New Jersey.

Fantastic, Andrew, I'm proud of you. Also, Scott from Scottsdale, Arizona. He's been invited to and accepted the invitation to the Unicorn Subcommittee that determines the next batch of emoji. Amazing. It's impressive, Scott. And happy birthday to Jesse, turn in 36, down the street over in San Francisco right here. And happy birthday to Steve Harshie from Huntington Beach, California. And Kerry in King of Pressure, Pennsylvania. And Jocelyn Wang in Fremont, California.

And Madison Magoo in Omaha, Nebraska. And Dakota Hillman in Denver, Colorado. And Caroline McGuire in Cooper Tino. And congratulations to both Gabby and Joey, who just got engaged in Kansas City, Missouri. Yeah. Good luck on the Kellogg Consulting Interviews. Abby. You got this. If you know, you know. This is Jack. Nick owns Stock of Square and he does not, I repeat, does not own Bitcoin

name Ben. No more Ben than Bitcoin. The Robin Hood Snacks podcast you just heard reflects the opinions of only the hosts who are associated persons of Robin Hood Financial LLC and does not reflect the views of Robin Hood Markets Inc or any of its subsidiaries or affiliates. The podcast is for informational purposes only and is not intended to serve as a recommendation to buy or sell any security and is not an offer or sale of a security. The podcast is also not a research report and is not intended to serve as the basis of any investment decision. Robin Hood Financial LLC, member FINRA, SIPC.