Nike’s Dramatic Downfall & Britain’s Road to Economic Recovery
Jul 15, 2024
48:10
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The hosts discuss Microsoft and Apple's seat relinquishment at OpenAI, Nike's decline, UK's post-election economy, and concerns with Labour's manifesto. They explore Nike's loss of dominance, UK's economic challenges, and potential stock buys.
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Quick takeaways
Nike faces challenges with a 20% stock drop and potential activist intervention.
UK Labour party aims for economic recovery post-Brexit with growth initiatives and concerns over proposed changes.
Deep dives
Brex: Simplifying Corporate Spending
Brex offers a corporate card and AI-powered spend platform that allows users to manage spending proactively. By providing real-time visibility and automating tasks, Brex aims to give users more time for strategic work, enabling efficient cost control and growth.
Challenges Faced by Nike: Market Decline
Nike faces significant challenges as evidenced by a 20% stock drop, the largest in company history, wiping out $28 billion. Sales have slumped, and Nike's stock is down more than 30% year-to-date. Possibility of an activist intervention looms due to the company's weakened position.
Labour's Economic Plan for the UK
The Labour Party in the UK aims to address economic challenges inherited post-Brexit. The plan includes a focus on growth through public sector investment, green sector funds, and housing projects. While the initiatives are welcomed for revitalizing the economy, concerns remain over the scale of proposed changes.
Outlook on Second Quarter Earnings Season
The podcast anticipates notable earnings reports from financial institutions like Goldman Sachs, Bank of America, and investment firms. Expectations are high for companies like Johnson & Johnson, Netflix, and American Express, with a prediction of potential activist intervention at Nike amidst market challenges.
Scott and Ed open the show with a discussion around why Microsoft and Apple have relinquished their board observer seats at OpenAI. Then Scott breaks down Nike’s fall from dominance, shares some insight from when Nike was a client at L2, and considers if the stock is a buy. Finally, Scott and Ed discuss the state of the UK economy post-election and Ed identifies his largest point of concern with the Labour party’s manifesto.