The Rundown - Apple CFO to Step Down, Zuck Says White House 'Pressured' Meta to Censor Covid Content

Episode Date: August 27, 2024

Stock market update for August 27, 2024.

Public.com presents the rundown, your daily market update in five minutes. My name is Zadmani, and today is Tuesday, August 27th. In today's episode, we tell you the executive shakeup at Apple and the new guy filling the role of CFO. Also, Zuck said the White House pressured him back in 2021 to censor COVID-19 related content. Very interesting comments from Zuck. We also tell you why shares of Kava are dropping. Then stick around to the end of the show to find out an interesting side effect of low-rate mortgages.

All right, let's go. Well guys, the stock market got off to a mixed start this week. Both the S&P and NASDAQ were down slightly on Monday, even though more than half the stocks and the S&P 500 were in the green. But the indexed down by big tech stocks and semiconductor stocks. Some of the biggest losers on Monday were super micro, broadcom and micron. I'm sure you guys recognize some of those names. And remember, the S&P and NASDAQ are market-cap weighted indices, so larger companies have a larger impact

on the overall index. And the fact that big tech stocks and semiconductor stocks were down on Monday could mean that investors are kind of nervous about the Nvidia earnings which are scheduled to come out Wednesday after market close. So as always, the entire fate of the stock market rests on Nvidia's shoulders. We'll know how it goes by tomorrow night.

By the way, the Dow Jones Index hit record highs yesterday. It's the 23rd record closed for the Dow this year, but nobody cares about the Dow. If you know, you know. Let's run through some headlines. And let's start with Apple because we got a surprise shakeup in the Apple executive team. Apple's CFO, Luca Maestri, is stepping down a CFO after being in the role since 2014. But my man, Luca, isn't actually leaving Apple.

He's just transitioning to a different role. Luca Maestri will now lead teams focused on IT, security, and real estate development, which is kind of a weird mix there. You know, I feel like this is something that happens with Apple executives a lot. They step down from their main role, but they don't leave the company completely. They transition to a smaller, maybe a different role. You know, my theory on this is that it's probably pretty cool being an Apple executive, but it's probably a lot of work as well, especially for some of the bigger roles like CFO.

And these executives have probably made so much money that they don't mind taking a pay cut to take on a smaller role at Apple. Now, Maestri is going to be replaced by Kevin Perrick. He's also been on Apple for over a decade. Kevin Perrick has pretty big shoes to fill because during Maestri's tenure as CFO of Apple, Apple stock has gone up almost 800% and annual sales have more than doubled. And shareholders love Myastree because he's done hundreds of billions of dollars in share buybacks. So good luck to Kevin Perrick. It's always tough following someone who's really

successful at their role. But I'm sure he'll do great. He's officially going to take over that role starting January 1st and report directly to Tim Cook. Now the only question is who's going to take over for Tim Cook whenever he decides to step down? Tim Cook is 63 years old. So I don't know how much longer he's going to want to do this for. By the way, Apple also announced yesterday that their iPhone event will be taking place on September 9th. So in a couple of weeks, Apple's going to show off their new iPhone. I mean, Apple is betting big on this iPhone because it's supposed to be pack full of AI features. Guess we'll learn more in a couple weeks. Let's shift gears and talk about another tech legend, Mark Zuckerberg. Mark Zuckerberg says that White House reportedly

pressured meta to censor certain COVID-19 content during the pandemic. Zuck made the confession in a letter to the House Judiciary Committee and said that humor and satire posts were included it in the censorship. In August of 2021, Meta said that it removed over 20 million pieces of content from Facebook and Instagram for violating its COVID misinformation policies. But Zuck said in the letter that he regretted not speaking up earlier about the pressures, and he said he's going to push back if this were to happen again. You know, protecting free speech while trying to figure out what to do with potential harmful content is not a new challenge for meta or other social media platforms, but it's becoming an increasingly hot-button issue since Elon Musk acquired Twitter,

and it's becoming even more front and center after the CEO and founder of Telegram was arrested in France over the weekend. So very interesting timing for Mr. Zuck. And let's talk real quickly about Paramount because the drama is over. It looks like Skydance is officially going to acquire Paramount after billionaire Edgar Brofman Jr.

decided to drop his last minute bid for the company. Brofman initially offered around $4 billion for the company, then he upped his price to $6 billion, but the offer still couldn't match Skydance's total offer of $8 billion. And the fact that Paramount was even listening to Profman's offer when it couldn't beat Skydance's offer made Skydance a little upset. The lawyers even wrote some strongly worded letters to Paramount. But it looks like the drama is officially over.

Skydance will buy national amusements, which is the majority shareholder of Paramount as part of the deal, and then merge with Paramount. Now, I say that drama is over, but technically Paramount has until September 5th to get a better offer than what Skydance made. So if any of you guys that are listening has like $8 plus billion hanging around and want to buy Paramount, just make sure you get the offer in before the deadline. Paramount shares are down like 5% on this news. Let's talk about some stocks making moves today. Shares of Eli Lilly are up today

after they announced a new form of its weight loss drug Zepbound that they plan to sell for half the cost of its usual monthly price. The price will start at $399 per month and it's going to be sold through the direct-to-consumer website. Eli Lilly is hoping that this will increase access to its weight loss drug to people without health insurance coverages. The stock is up around 2% at the time of this recording. On the flip side, shares of Hymns and Hers,

which sells a cheap generic version of weight loss drugs, their shares are down 6% this morning. So competition for weight loss drugs starting to heat up. Now, shares of Kava are sliding this morning after regulatory filings yesterday showed that insiders and executives sold millions of dollars in stock. The CEO sold over $24 million in stock. The co-founder of the company sold over $12 million in stock,

and the CFO sold around $600,000 in stock. That tends to send shares lower, Because investors are like, yo, why are these insiders selling so much stock? Kava stock is down more than 8% in the pre-market in reaction to this news. But overall, though, Kava stock has had a fantastic year. The stock is up more than 200% as of market closed on Monday. That's like even better than Nvidia. Let's wrap the show with a fun fact.

Around 75% of U.S. mortgage holders have a interest rate lower than 5%. Now, I've mentioned a few times on previous shows that homeowners locked into a low interest rate is one of the main causes of the housing market being frozen right now. Homeowners that have a low-rate mortgage, they don't want to sell their house and move to a higher rate. So that's pretty much dried up the supply of houses on sale. Another interesting effect of low-cost mortgages is that U.S. consumers got a $600 billion boost since 2022. This is according to analysis from Swiss RE Institute. You know, because less money going towards a mortgage payment leaves more money to buy other things or to go traveling or to invest.

I mean, that could be one of the reasons why consumer spending continues to be. be pretty strong. This could also be playing a role on how quickly the economy was able to bounce back and potentially head towards a soft landing. It could also be playing a role in inflation. So I think it could take years for us to fully grasp the impact of low interest rates had on the economy. It's pretty interesting stuff though.

Well, all right, guys, that's the rundown for today. Hope you guys enjoyed the show. If you did, don't forget to hit us with that five-star rating on Apple and Spotify. And if you're listening on Spotify, don't forget to vote in today's poll. All that engagement really does help us out. Thank you guys so much for listening. Shout out to Connor and Mike for all the help behind the scenes. And we'll see you guys back here tomorrow.

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