The Best One Yet - 🧻 “Toilet Paper hates your hoarding” — Who wants to buy Lyft? $1 Trillion stimulus bill. TP’s front-loaded demand drama.

Episode Date: March 18, 2020

Lyft is worth 1 Lyft, but 1 Lyft is now worth less than $6B, so we’re wondering who may buy it (the whole company). Toilet paper sales have surged for Kimberly Clark, but the front-loaded demand now may not help its future sales. And the latest update in the government’s COVID-19 response is a nearly $1 Trillion stimulus package that completes a policy trifecta.Learn 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 Wednesday, March 18. Snackers, yesterday stocks rose by 6%, which until this month would have been like the best day I've ever seen. And remember yesterday's worst crash since 1987? Yeah, Nick, I remember I potted with you. Half that loss got erased by yesterday's awesome game.

The reason why leads us to our first story, which is part of the best snacks daily we have ever done. This is the best one yet. turns out Nana has been on to something all these years. We all love getting checks in the mail ASAP. So the Trump administration decided it's going to go ahead and try to do that for every American. Thousands of dollars is way better than the $100 we're used to from Nana, which we were lucky if it was on. Nana's $100 has been real generous.

We're going to break down the new $1 trillion stimulus bill. Second story, what have we got yet? Kimberly Clark's toilet paper is nowhere and it's everywhere. It's nowhere in the grocery. stores, but it's everywhere in your one-distirving closet. We're talking about one-time bumps and sales, like the one happening right now in America for toilet paper. Toilet paper is a fad. It's not a trend. Third and final story, after this brutal month, Lyft is now worth $5 billion. Here's the $1 million question. How many lifts is one lift? You don't have to be a mathematician

on that one. We're wondering if one company is going to buy the dip. We're not talking lift stock. We're talking lift the company. Like mom says, when things get tough, go back to where you got married. No joke, Snackers. Jack's up in Vermont where he did his nuptials. I managed to make it all the way to Nantucket where I said I'd do a couple years ago. We managed to get out of California because we anticipated a long and extended work from home situation, which honestly I think we should all brace ourselves for it right now.

Snackers, Jack and I were potting remotely. We're doing it from the East Coast. We're on market time for Wall Street as we work. from home. Here's the thing. Nick and I cut our cord back home, but here at these houses we're in, he still got cable, and we noticed something interesting. Yeah, apparently there are no sports on TV whatsoever. Yeah, so what's happening on the sports channels when there's no live sports happening in America? Turns out ESPN announced yesterday they got a plan for this situation that they definitely did not plan for. Yeah, because the talking heads on first take can only talk about Tom Brady leaving the Patriots for so long.

What are the odds he goes to the cult? What are the odds he goes to the Buccane? So let's look at the numbers again. Let me say, if he goes to the Giants, I'm done being a Giants fan. Two plans for what they're going to do in the world of no live sports. Jack, what's ESPN up to? The first one is basically reruns of old classic epic games from the past. We're talking Mark Messier scoring a hat trick against the Devils in game 694. It feels like 94, Nick. I'm also planning to watch Tim Tebow rip up the Steelers in 2012 for 316 yards and three touchdowns and an overtime win. It's not about the passing. game, he's really about the running game.

The second thing ESPN is going to do to fill up their channel with something is alternative sports. We're talking dodgeball. Cornhole. Darts. One snacker tweeted us about some four-way volleyball. Apparently that's a thing. Yeah, you stay six feet apart and you never, ever, ever slap the other person's hand or

butt. Nick, how about Spike Ball, the Beach Classic? It's basically ESPN 8. The Ocho. Jack, I think you're thinking what I'm thinking over here, and I already know what you're thinking. Yeah, this content sounds really good. Can you uncut the court? Let's hit our three stories, and we'll uncut things.

You're tuned in to snacks daily. We spoke to the lawyers and we got to get something legal out the way. The snacks about the hair ain't food. It's air candy. They don't reflect the views of the Robberhood family. It's all informational just so. You know, we're not recommending any securities. It's not a research report or investment advice.

Not an offer or sale about security. Snacks is digestible. Business news for you. Robahood Financial, LLC. For our first story, toilet paper hoarding isn't as amazing for Kimberly Clark as he probably thought it would be. The first rule of toilet paper hoarding. Stop toilet paper hoarding. Snackers, we can't control the coronavirus crash.

We can't control the TP-pocalypse. There are some surprising companies that are dominating our forced coronavirus small talk right now. Yeah, did you hear about Clorock? Stocks up 33% this year. Yes. Debra, we know that the spray cover wash home life cycle is in the products. Debra, we get it seriously. The other one, Zoom. Yes, your video conferencing into weekly sales presentations of Vinyasa flow. Why not? Guess what? Your dinner out with friends on Friday night? It's

happening on Zoom. Jerry, love what you did with your hair. I'm sure it feels fantastic. Now, forget about Baby Yoda and the Apple Watch 12. No, Jack and I are calling it right now. Toilet Paper is already the gift of 2020. Nick and I both just arrived in New York. homes and we both dashed to the grocery store to load up on essentials, there was not a square to spare in the Mad River Valley of Vermont. You'll look at the empty shelves on Nantucket. It's like they're crying at you and you want to hug them. Now, yesterday we were talking about work from home quarantine goals. Yep. How about somebody figures out how to do it yourself toilet paper? Well, Jack and I jumped in snack style looked into it. Two ingredients here, pulp and water. Boom, all you

need is a mill and a lot of time. Nick, I even went to the hardware store thinking they might have toilet paper? I've been there. They were stock clean out of toilet paper. Now, Snackers, when you think of TP, you got to start thinking of KC. That sounds like a good corporate slogan of Kimberly Clark, which is shockingly a huge player in toilet paper because they own the Scott Tollate Paper brand. Great brand. And the Cotonel toilet paper brand. Now, overall, in the last week of people have started hoarding, toilet paper sales nationwide have jumped 60%. That is nothing in comparison to hand sanitizer, which is up 470%. Meanwhile, Kimberly Clark, the toilet paper aficionado, it's already producing at like maximum capacity. Prior to the COVID-19 panic in

America, the mills that produced toilet paper at Kimberly Clark, they were already running 24-7 producing as much TP as possible. That means they had to shift supply chain resources over there. They're making fewer paper towels and they're allocating those resources to more TP. This be a case study of business school. Fantastic. So the stock for Kimberly Clark is up 18% in the past week as, you know, its products are becoming pretty essential at this moment. Now, Snackers, you know, Jack and I love getting deeper into a story. We looked at the earnings report and the annual report because we were just curious what percentage of its sales is toilet paper out of all that paper. Sadly, Kimberly Clark does not break out an individual category of toilet paper sales.

Unfortunately. All they do is provide dozens and dozens of pictures in their annual report. of beautiful adorable babies. Snackers, we can't emphasize this enough. These children were absolutely adorable. Here's the thing, though, toilet paper should not be looked at the same way by investors as something like Zoom conference calls. Or soap. And that's because it's not getting used more at this very moment.

It's just getting stocked in random people's closets because we're hoarding. Which sets us up perfectly for the takeaway. So, Jack, what is the takeaway for our buddies over at Kimberly Clark pumping out toilet paper? A surge in demand for your product is. isn't necessarily a good thing. Snackers, picture your life a year from now. You may have a new job. You may have new friends. You may be watching a new Netflix show, but you're going to have the same toilet paper from that same messy closet. Unless you got a promotion and you're upgrading your life to three-ply lifestyle. The three-ply lifestyle is the goal of any lifestyle. The thing is,

Snackers, staples like toilet paper, they have a very predictable and a very consistent demand from people. also they're non-perishable. So the stuff you bought last year, it's still good today. So Kimberly Clark is actually worried that all this demand and all these hoarders are actually front-loading all the demand to begin with. Surge of purchases right now for toilet paper in storage could mean people buy less toilet paper in the future because they already stocked up. And your bathroom habits, they probably haven't changed much just because of coronavirus. For our second story, economic stimulus is likely coming to nearly all Americans. We're talking to, we're talking to We're talking a check of up to $4,500 for you, for me, for everybody.

It sounds like a freaky ABC game show. It's going to last one season. Nick, the trifecta is nearly complete. Snackers, we're talking monetary policy. Public health policy. Fiscal policy. Some economics professor just exploded of joy. Boom, whiteboard covered.

It's messy. Now, let's talk about the first one. The Federal Reserve Bank of the United States has already used up pretty much all of its main tools, which are all monetary policy. And by monetary policy, we mean focused on the financial system. The Fed cut interest rates to zero and added two trillion dollars of new loans to the financial markets. All right. So that was first number one. Second number two. Families First Coronavirus Response Act. Jack, it sounds word. This is focused on public health policy. It's the old FFCR. Classic. And it's focused on like beefing up the medical system to handle COVID-19. We're talking like free

testing for COVID-19 and then paid sick leave because you need paid sick leave. Right. The House passed this bill last week and the Senate, according to our buddies at Schoolhouse Rock, is expected to vote on it this week and it's actually expected to pass. And that brings us to the news, which is number three, aka the third, a not yet named stimulus bill that we're probably just going to call the free money act. Yeah, we're going to call the Free Money Act. It's focused on fiscal policy. They could have called this thing Project Seymour. That would have been so much lamer, though. Focused on the because it's about government spending, tax cuts, and bailouts. Yeah, the bailout is for the airline industry. We'll probably cover that in tomorrow's snacks. But this bill was proposed by President Trump

yesterday. It includes $1 trillion of costs to the government to help the economy recover. Snackers, sit down for a second, talk to your friends and make sure we all heard this number correctly. One trillion with a T. Jack, can we get some historical context on that? That is 33% bigger than the economic stimulus bill passed in 2009 to help us recover from the financial crisis of 08. And about a quarter of that trillion dollars would be cash and money that would go out to every American, or nearly every American. This is where we go back to Nana. Literally, every American, except the mega wealthy ones most likely. We'll get a check from the federal government, probably for thousands of dollars. We're thinking like two, three, or four thousand dollars.

Quick hiccup there. It's got to pass through Congress. Again, thanks for the reminder schoolhouse. Rock. So Jack, what's the takeaway for our buddies who are basically everyone looking at what's going on with policy every day right now? Killing coronavirus requires wounding our economy. Snackers, it is a sad, brutal truth. To flatten the curve, you kind of have to flatten the economy. We're talking social distancing, which requires no Friday date nights out with friends. Hard one over here. Jack and I had an Airbnb ski weekend and Tahoe planned not happening right now. We're going to have to pizza and French fire away somewhere else. It's a true story. Nick and I were planning a couple's weekend. It was going to be lovely.

We had a view of Lake Dollow, but it's canceled. More and more states and cities are forcing people to stay at home, which means they're not spending money. As people stay at home and do not go outside, this is going to be devastating to businesses, to spending, and to jobs, aka devastating to our whole economy. But if we can like pull off this whole flattening situation right, then the disease can be contained and we can eventually get back to normal, which could peak in like 45 days they're saying. Yeah. And we would have to be. also avoid a much greater public health disaster that could kill like a whole lot of people. But Jack and I are looking at this and it's up to the government and leaders in business to

help the economy survive until the virus passes. For our third and final story, this one is wild. Lift just hit a new low. Could somebody buy the dip? Not the stock dip. We're talking the company dip. Oh my God, Snackers, there is no way anyone is lifting right now unless they are aggressively purrelling for breezing chloroxing themselves. The driver's like, one second, into the back seat. You're like, what's that? He's like, it doesn't matter. It killed every microbe on you. Now, things just changed big time in Uber and Lyft's hometown of San Francisco. We got some stay-at-home orders from the government, meaning San Franciscans are getting to know our apartments really well. Nobody in the Bay Area is going to visit their organic farming

rave until at least April 7th when this stay-at-home order ends. Now, you're going to have to reschedule that thing, although there's going to be plenty of people down. for it in April. Now, this also means there's going to be minimal Ubering and minimal lifting going down in San Francisco. And a big news development yesterday is that outside the Bay Area, Uber and Lyft have both banned pooling. There's some seriously awkward tension in the backseat between people taking the same Uber pool right now. They're like, how are you doing? They're like, don't touch me. No one is sitting in that middle section, even though the middle section is kind of the best section. Now, the result, Uber stock is down 53% in the last month. But Jack and I are looking at this, and at least Uber also has Uber eats as it's like aggressive side hustle. Meanwhile, Lyft is down 65% in the past month. And it's got

no other gig biz that can fall back on. It's really just a ride hailing company. Snackers, you have heard Nick and I mention Lyft as our preferred unit of measurement when we're talking about company valuations. No, that is true. And this is not been acknowledged by the rest of the journalism or investor community. We were hoping that would catch on. It really is only caught on among everyone who's listening to this podcast right now. Coca-Cola is worth 16 lifts because Coke is worth $200 billion and Lyft was worth $12 billion. Only thing we've noticed is a problem with this unit of measurement. The value of Lyft has fallen dramatically from $12 billion down to $5 billion. Yeah. So Snackers, when you hear us say that something is like three lifts, it's actually not

that big right now. Those podcasts are now outdated if we may have to revise them. Now, Snackers, you may have also heard people around you right now. talking about buy the dip this, buy the dip that. It's a concept that refers to when a stock has fallen so much, it's kind of like it's on sale. So you could buy the dip, hoping it goes up, but of course, remember, it could go down. Right. Can you believe it? Uber is down 53% that's like 53% off. What a great deal. But bear in mind, Uber stock can definitely go down further. Here's the funny thing about the buy the dip concept. You could also apply it to entire companies, not just stocks. Right. Its valuation has fallen.

let's acquire the whole company. It's cheap right now. Let's buy the dip. Like Lyft's value dropping from $15 billion to $5 billion. So Jack, what's the takeaway for our buddies over at Lyft? Who could buy the Lyft company dip right now for just $5 billion? Snackers, Jack and I spent a disturbing amount of time yesterday thinking about this, and that's why we want to make it the pod story.

So we've got a straightforward option, a stretch option, and kind of one crazy option for you. All right, let's start with a straightforward option. General Motors could buy Lyft because it's future. self-driving fleet could operate on the Lyft app that everybody already has downloaded. This is kind of a fun option, but it's also straightforward because GM is already an investor in Lyft and it's already made an acquisition offer before. All right, let's move to our stretch idea about who could acquire Lyft and buy the dip for just $5 billion. The option there is Grubhub. Grubhub could kind of merge with Lyft and then team up together to more, better take on Uber.

Right. With Grubhub's food delivery plus Lyft's rides business, that would be a better rival to Uber. It's kind of like an adorable merger of equals since both companies are worth a little under $6 billion or about one lift. All right. Now let's hit him with the crazy like, wow, Jack and Nick, I can't believe you guys thought of this absurd idea. I'm going to tell my friends about it and pretend it was my idea. Yeah, actually, we came up with this idea hoping other people just take this idea and run with it. Honestly, we want no credit on this. We're thinking Amazon turns around, acquires lift potentially, and turns it into its biggest prime perk of all. Imagine if Amazon told you to join Amazon. Amazon Prime for $120 a year. If you do, every Lyft ride is $15

no matter what, because you're a prime member. Boom, bonus opportunity here. The Lyft drivers now owned by Amazon can keep packages in the back of their cars for delivery. Wow, that's a crazy idea. We recommend Snackers. You steal that and pretend it's your idea. If you have a better idea, tweet us a Robin Hood Snacks, Jack and I want to hear it. Jack, can you whip up the takeaways for us over there? Somebody at Kimberly Clark made the big decision to get into toilet paper years ago. That decision was big, but the boost in sales of toilet paper isn't expected to become a trend. Second story.

The Trump administration has proposed a $1 trillion stimulus package, including checks for every American. Jack, I think the trifecta of policy is complete. Now, we got monetary policy. Which is the financial system. You got public health policy. Which is the medical system. And can I get a fiscal policy? Boom, the economy, a $1,000 check.

for you and me. Third and final takeaway. Lifts valuation has fallen 65% in a month. It's now worth just $5 billion. We're wondering if GM, Grubhub or Amazon will buy the company, not the stock, dip. Now time for our snack fact of the day. This one sent in by Ethan Guller over in lovely St. Louis, Missouri. Congrats again on the Blues. We say St. Louis, Missouri, but Ethan actually was just studying abroad in Madrid, Spain. Great town. And when he got back, he was forced to do the responsible thing and quarantine in his parents' basement for two weeks and probably play a lot of video games. Ethan is snacking while quarantining, and it turns out he did a little more research on quarantining while he's in quarantine. Turns out quarantines go way back to the 14th century.

Great time. When coastal cities protected themselves from plagues by like quarantining ships coming in the hobba. You literally had like a glass ship shown up in Venice from some infected port, so it was required to wait anchor for 40 days before landing. They're like, 50 meters offshore. They're like, hey, what's the score of the football game? No, they're like, hey, we're just trying to take a gondola ride over here. How long is this going to take, guys? 39 more days. Then you can come on to shore. By the way, we check the CDC website. What would you see, though, Jack? I saw that. It's true. This is fully proofed, correct. Ethan Guller, great guy. Snackers, we love working from home with you. But remember, you're probably with other

people in your home potentially. And if you are, H-Y-H-Y-S-D. Have you had your snacks daily? If you know, you know. 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, 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. This is Jack. I own stock of Amazon.