Happy Tuesday!

📝 Focus

• The 100 Year Life - are you ready? (Part 2 of 2)

📊 In the Markets

• ChatGPT's Italian Ban

• WrestleMania MergerMania (EDR and WWE)

📖 MoneyFitt Explains

🎓️ Mergers & Acquisitions - All-Stock Transaction

📝 Focus

The 100-Year Life - Are You Ready? [Part 2]

Today’s Focus story is part 2 of a 2-part series by Steve Conley, Founder of the Academy of Life Planning (AOLP). AOLP provide financial planning without financial advice for tech-savvy self-directed consumers. Read yesterday’s issue to learn about the principles of 1. Rethinking Life Stages, 2. Emphasising Lifelong Learning, and 3. Financial Planning and Adaptability.

In today’s issue, Steve continues to share his perspective on the fundamental principles and steps necessary to make the most of this extended lifespan.

4. Prioritising Health and Well-being: As we live longer, investing in our physical and mental well-being is crucial. A proactive approach to health, including regular exercise, a balanced diet, and stress management, is necessary to maintain a high quality of life throughout our extended years. We must invest in improving our health and life expectancy to enjoy our livelihood for longer.

5. Fostering Social Connections: Strong relationships and social support networks are crucial in a 100-year life. Forming and maintaining connections with family, friends, and colleagues contributes to emotional well-being and overall life satisfaction. Intergenerational relationships and mentorship also play a vital role in exchanging knowledge and support across age groups. This mindset helps us to live longer and better.

6. Embracing Flexibility: The 100-year life requires a high degree of adaptability. We must be open to change, taking risks, and exploring new opportunities. Developing a growth mindset and embracing new experiences will be invaluable in navigating the many transitions we'll face during our extended lives. We need to move out of our comfort zones and embrace a growth path.

The 100-year life presents both challenges and opportunities for individuals and societies. But we need a new paradigm for financial services and embrace opportunities presented by technological innovation in fintech and AI to deliver it to mass audiences. By rethinking life stages, prioritising lifelong learning, adapting our financial strategies, investing in health and well-being, fostering social connections, and embracing flexibility, we can make the most of our extended lifespans and create a fulfilling, sustainable future for everyone everywhere.

📊 In the Markets

Markets were little changed by the close of Monday, with the large-cap S&P 500 ending higher on strength in energy stocks after OPEC+'s Sunday Surprise output target cuts. This sent crude oil prices up and thirsty pundits onto the TV with forecasts of $100 oil. Exxon Mobil, Chevron and Occidental all rose by more than 4%. Tesla, on the other hand, dropped 6% and gave up all of Friday's gains after announcing record deliveries that nonetheless missed investor expectations for the first quarter (when it kicked off a brutal price war in the global EV industry.)

..... ► Higher oil prices (whether at $100/bbl or not) would be a challenge for central banks as it would cool economies by sucking money away from other spending (which is actually what central banks want, to cool inflation) but at the same time adding to upward price pressures (definitely what central banks do not want!) At best, it reduces some of the disinflationary pressures seen in most economies this year (meaning that energy prices may be high, but well off their highest levels.)

So, barely a day after Friday's quite encouraging news on the inflation front, inflation and, therefore, the higher interest rates needed to combat it, was again a concern for investors. This led Nasdaq to a down day as techie growth stocks are hurt more by a higher interest rate outlook as they reduce the value of today's earnings made far into the future. Luckily (in Wall Street's perverse way), surveys are showing the manufacturing sector --11% of the US economy-- is looking pretty weak.

..... ► The manufacturing PMI fell to 46.3 last month, the lowest since May 2020, from 47.7 in February, and much worse than the 47.5 expected (but still above May 2020’s pandemic trough of 43.5). Anything below 50 shows contraction, and this was the 5th month in a row under that threshold. All eyes on services, though, which make up 2/3rds of the economy.

ChatGPT’s Italian Ban

Italy's data privacy watchdog, Garante, independent of the government, on Friday issued an "immediate temporary limitation on the processing of Italian users’ data by OpenAI." It's not supposed to be a permanent ban, but to open dialogue about the use and protection of user data since Generative AI like Microsoft-backed OpenAI's ChatGPT and Google's Bard, relies on collecting, analysing and storing immense volumes of data to "train" the chatbot, some of which would be personal and owned by internet users. In particular, this may breach the EU's General Data Protection Regulation (GDPR). Other European regulators are watching closely.

General Data Protection Regulation (GDPR) - a mini-explainer

• The EU's General Data Protection Regulation (GDPR) is a set of privacy regulations that went into effect in 2018 to protect the personal data of all EU citizens and residents. Companies located outside the EU may still need to comply if they are collecting and processing the personal data of EU citizens.

• The GDPR requires companies to obtain explicit consent from individuals before collecting and processing their personal data, and to provide transparency on how their data is used.

• The GDPR also gives individuals the right to access, correct, and erase their personal data, and requires companies to report data breaches within 72 hours.

• The GDPR has been controversial due to its strict requirements and potential penalties for non-compliance, which have created costs and other challenges for companies of all sizes. There is no federal US equivalent.

Wrestle Mania Merger Mania (EDR and WWE)

MergerMania! Endeavor Group, the parent company of UFC and the largest global mixed martial arts organisation (and a major talent and media agency,) will buy World Wrestling Entertainment, Inc. (WWE) to create a combined real-and-fake combat sporting entertainment giant. WWE owner Vince McMahon, until recently sidelined under a sex-related hush-money scandal (such things happen in the US?), had in February been pitching the company he'd bought from his dad for $1 million in 1982 for $9 Billion.

..... ► CNBC reported that WWE would have an enterprise value (meaning the value of shares plus debt the company owes, less its cash) of $9.3bn in the deal, with UFC (wholly owned by Endeavor) valued at $12.1bn. Endeavor will pay an all-time high price for WWE of $106 per share… but using its shares in UFC, not actual cash, i.e. the acquisition will be an all-stock merger 🎓 with Endeavor ending up holding 51% of the combined company.

..... ► The merged company will have a new ticker, "TKO", and be led by the CEO of Endeavor, Ari Emanuel. He is a Hollywood power broker and co-CEO of IMG, the global sports, events and talent management company that's also under Endeavor. (Emanuel was the inspiration for Ari Gold in HBO's "Entourage.")

..... ► Emanuel transformed Endeavor from a talent agency (which included the storied William Morris Agency name) into an entertainment creator not only with UFC but with bull-riding events, fashion shows and the Miami Open and Madrid Open tennis tournaments. The value of sports streaming rights has soared in recent years and Endeavor will negotiate the deals for WWE, using its scale in streaming (where tech giants have piled in to bid for content) and live events.

📖 MoneyFitt Explains

🎓️ Mergers & Acquisitions - All-Stock Transaction

In an all-stock merger, the acquiring company uses its own private or publicly-traded shares to acquire the target company's shares. The merger must be approved by the shareholders of both companies.

The value of the target company is determined by calculating the number of shares it will receive in exchange for its own shares based on the current (or agreed) stock price of the acquiring company. The debt of the two companies will be combined into the newly merged entity.

The surviving legal entity is usually (but not always) the acquiring company, with the merged entity conducting business under its existing structure, while the acquired company ceases to exist as a separate legal entity.