Category Archives: Stocks

The Fall Of Facebook Has Only Just Begun

Their platform is broken and neither human nor machine can fix it.

Even after losing roughly a third of its market cap, it still may prove one of the great shorts of all time.

https://www.zerohedge.com/s3/files/inline-images/1_HagRF3FUkll6wLqx0bcLmA.jpeg?itok=pPpNa24c

(ZeroHedge) “There’s no mental health support. The employee suicide rate is extremely high,” one of the directors of the documentary, “The Cleaners” told CBS News last May. The film is an investigative look at the life of Facebook moderators in the Philippines. Throughout his 2018 apology tour, Mark Zuckerberg regularly referenced the staff of moderators the company had hired as one of two key solutions — along with AI — to the platform’s content evils. What he failed to disclose is that the majority of that army is subcontractors employed in the developing world.

For as long as ten hours a day, viewing as many as 25,000 images or videos per day, these low-paid workers are buried in the world’s horrors — hate speech, child pornography, rape, murder, torture, beheadings, and on and on. They are not experts in the subject matter or region they police. They rely on “guidelines” provided by Facebook — “dozens of unorganized PowerPoint presentations and Excel spreadsheets with bureaucratic titles like ‘Western Balkans Hate Orgs and Figures’ and ‘Credible Violence: Implementation standards’,” as The New York Times reported last fall. The rules are not even written in the languages the moderators speak, so many rely on Google Translate. As a recent op-ed by John Naughton in The Guardian declares bluntly in its headline, “Facebook’s burnt-out moderators are proof that it is broken.”

As we noted in last week’s issue, 41 of the 53 analysts tracked by Bloomberg currently list Facebook as a buy, with “the average price target… $187, which implies upside of nearly 36%.” That optimism springs from a basic assumption: the company’s monopolistic data dominance means it can continue extracting more from advertisers even if controversy after controversy continues to sap its user growth. Given the depth and intractability of Facebook’s problems, this is at best short-sighted.

The platform’s content ecosystem is too poisoned for human or machine moderators to cleanse. Users are fleeing in droves, especially in the company’s most valuable markets. Ad buyers are already shifting dollars to competitors’ platforms. Governments are stepping up to dramatically hinder Facebook’s data-collection capabilities, with Germany just this week banning third-party data sharing. The company is under investigation by the FTC, the Justice Department, the SEC, the FBI, and several government agencies in Europe. It has been accused by the U.N. of playing a “determining role” in Myanmar’s genocide. An executive exodus is underway at the company. And we believe, sooner or later, Facebook’s board will see no option but to remove Sheryl Sandberg and Mark Zuckerberg.

The market is drastically underestimating the peril the company is in. In the very short term, the user backlash may simply hinder its revenue growth. In the longer-term, however, the institutionalized failure to see and respond to the platform’s downsides may render Facebook the Digital Age’s Enron — a canonized example of how greed and corruption can fell even the mightiest.

According to data recently released by Statcounter, Facebook’s global social media market share dropped from 75.5% in December 2017 to 66.3% in December 2018. The biggest drop was in the U.S., from 76% to 52%. As Cowen survey results released this week suggest, these engagement declines will continue to depress the company’s earnings. Surveying 50 senior U.S. ad buyers controlling a combined $14 billion in digital ad budgets in 2018, 18% said they were decreasing their spend on Facebook. As a result, Cowen estimates the Facebook platform will lose 3% of its market share.

No doubt Facebook’s struggles are not just about the headline scandals. For years, one innovation priority after another has fallen flat, from VR to its video push to its laggard position in the digital-assistant race. The company’s most significant “innovation” success of the past few years was copying the innovation of a competitor — pilfering Snapchat’s ephemerality for its “moments” feature.

However, it’s the scandals that have most crippled the company’s brand and revealed the cultural rot trickling down from its senior ranks. Consider just the most-sensational revelations that emerged in 4Q18:

  • Oct. 17: The Verge reports that Facebook knew about inaccuracies in the video viewership metrics that it provided to advertisers and brands for more than a year. “The inflated video views led both advertisers and media companies to bet too much on Facebook video.”
  • Nov. 14: The New York Times publishes an investigative report that reveals Facebook hired a conservative PR firm to smear competitors and minimize the company’s role in Russia’s 2016 election meddling.
  • Dec. 5: British lawmakers release 250 pages of internal Facebook emails that show that, “the company’s executives were ruthless and unsparing in their ambition to collect more data from users, extract concessions from developers and stamp out possible competitors,” as The New York Times reported.
  • Dec. 14: Facebook reveals that a bug allowed third-party app developers to access photos people may not have shared publicly, with as many as 6.8 million users potentially affected.
  • Dec. 17: Two Senate reports reveal the shocking extent of Russia’s efforts on social media platforms during the 2016 election, including the fact thatInstagram was their biggest tool for misinformation.
  • Dec. 18: The New York Times reports that Facebook gave the world’s largest technology companies far more intrusive access to user data than previously disclosed, including the Russian search firm Yandex.
  • Dec. 20: TechCrunch reports that, “WhatsApp chat groups are being used to spread illegal child pornography, cloaked by the app’s end-to-end encryption.”
  • Dec. 27: The New York Times obtains 1,400 pages of Facebook’s moderation guidelines and discovers an indecipherable mess of confusing language, bias, and obvious errors.

Scandal after scandal, the portrait of the company is the same: Ruthlessly and blindly obsessed with growth. Overwhelmed by that growth and unwilling to take necessary steps to compensate. Willing to lie and obfuscate until the truth becomes inescapable. And all the time excusing real-world consequences and clear violations of user and client trust because of the cultish belief that global interconnectedness is an absolute good, and therefore, Facebook is absolutely good.

The scale of Facebook’s global responsibility is staggering. As Naughton writes for The Guardian:

Facebook currently has 2.27bn monthly active users worldwide. Every 60 seconds, 510,000 comments are posted, 293,000 statuses are updated and 136,000 photos are uploaded to the platform. Instagram, which allows users to edit and share photos as well as videos and is owned by Facebook, has more than 1bn monthly active users. WhatsApp, the encrypted messaging service that is also owned by Facebook, now has 1.5bn monthly active users, more than half of whom use it several times a day.

Relying on tens of thousands of moderators to anesthetize the digital commons is both inadequate, and based on the reported working conditions, unethical and exploitative. AI is not the solution either, as we explored in WILTW April 12, 2018. According to Wired, Facebook has claimed that 96% of the adult and nude images users try to upload are now automatically detected and taken down by AI. That sounds like a success until you consider that that error rate means 1.3 million such images made it to the public in the third quarter of 2018 alone (30.8 million were taken down).

In fact, the company has acknowledged that views with nudity or sexual content have nearly doubled in the 12 months ending in September. And detecting nudity is a far easier task for a rules-based algorithm than deciding the difference between real and fake news, between hate speech and satire, or between pornography and art.

Facebook has economically and culturally empowered hundreds of millions of people around the world. It cannot be blamed for every destabilized government, war, or murder in every region it operates. However, more and more, it’s clear that one profit-driven platform that connects all of the world’s people to all of the world’s information — the vision Zuckerberg has long had for his invention — is a terminally-flawed idea. It leads to too much power in the hands of too few. It allows bad actors to centralize their bad actions. And it is incompatible with a world that values privacy, ownership, and truth.

Governments are waking up to this problem. So is the public. And no doubt, so are competitive innovators looking to expand or introduce alternatives. Collectively, they will chip away at Facebook’s power and profitability. Given the company’s leaders still appear blinded by and irrevocably attached to their business model and ideals, we doubt they can stave off the onslaught coming.

Source: ZeroHedge

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This Time Is Different

Bubble Burst? Smart Money Flow Index Continues To Decline To 1995 Levels

The Smart Money Flow Index, measuring the movement of the Dow in two time periods: the first 30 minutes and the last hour, has just declined AGAIN.

https://confoundedinterestnet.files.wordpress.com/2018/11/smartdow.png?w=625

The Smart Money Flow Index, like the DJIA, has been around for decades. But it has just fallen to the lowest level since 1995.

https://confoundedinterestnet.files.wordpress.com/2018/11/smfdow31.png?w=625

Is the asset bubble starting to burst? Or is it just one lone indicator getting sick?

https://confoundedinterestnet.files.wordpress.com/2018/11/008-sick-of-this-party-2132469.jpg?w=625

Source: Confounded Interest

Is The Corporate Debt Bubble Bursting? GE’s 5% Perpetual Bond Falls To $79 While Stock Goes Sub-$10

Last decade, there was a residential mortgage credit bubble that burst. While there doesn’t appear to be a residential mortgage credit bubble (well, just a little), there is most definitely a corporate debt credit bubble that appears to be bursting.

Take General Electric. Their stock price has slipped to under $10 per share from over $30 per share back in early 2017 while the 5% perpetual bond has rapidly gone from around par ($100) to $79 in the wink of The Fed’s eye.

https://confoundedinterestnet.files.wordpress.com/2018/11/geperp.png?w=624&h=449

Of course, GE’s earnings-per-share have been tanking as interest rates have been rising.

https://confoundedinterestnet.files.wordpress.com/2018/11/geearn.png?w=625

And to make matters worse, US investment grade debt is on track for worst year since 2008.

https://confoundedinterestnet.files.wordpress.com/2018/11/corpbondpain.png?w=625

Like Robot Monster, the Federal Reserve has helped to create bubbles in the corporate bond market.

Source: Confounded Interest


“The Collapse Has Begun” – GE Is Now Trading Like Junk

Two weeks after we reported that GE had found itself locked out of the commercial paper market following downgrades that made it ineligible for most money market investors, the pain has continued, and yesterday General Electric lost just over $5bn in market capitalization. While far less than the $49bn wiped out from AAPL the same day, it was arguably the bigger headline grabber.

The shares slumped -6.88% after dropping as much as -10% at the lows after the company’s CEO, in an interview with CNBC yesterday, failed to reassure market fears about a weakening financial position. The CEO suggested that the company will now urgently sell assets to address leverage and its precarious liquidity situation whereby it will have to rely on revolvers – and the generosity of its banks – now that it is locked out of the commercial paper market.

https://www.zerohedge.com/sites/default/files/inline-images/GE%20CP%20hole.jpg

Indeed, shares hit levels first seen in 1995 yesterday and have only been lower since, very briefly, during the financial crisis when they hit $6.66 in March 2009. For a bit of perspective, Deutsche Bank notes that the market cap of GE now is $69.5bn and it’s the 80th largest company in the S&P 500. Yet in August 2003, GE was the largest company in the index (and regularly the world between 1993-2005) at a market cap of $296bn, $12bn more than Microsoft in second place. Since then, the tech giant has grown to be a $826bn company well over 10 times the size, while GE’s market cap peaked (ironically) during the dot com bubble in August 2000 at $594BN before tumbling first in the tech crash and then the GFC.

But while most investors have been focusing on GE’s sliding equity, the bigger concern is what happens to the company’s giant debt load, especially if it is downgraded to junk.

First, some background: GE had about $115 billion of debt outstanding as of the end of September, down from $136 billion a year earlier. And while GE is targeting a net EBITDA leverage ratio of 2.5x, this hasn’t been enough to appease credit raters, which have expressed concern recently that GE’s beleaguered power business and deteriorating cash flows will continue to weaken the company’s financial position. As a result, Moody’s downgraded GE two levels last month to Baa1, three steps above speculative grade. S&P Global Ratings and Fitch Ratings assign the company an equivalent BBB+, all with stable outlooks.

The problem is that while the rating agencies still hold GE as an investment grade company, the market disagrees.

GE – a top 15 issuer in both the US and EU indices – was recently downgraded into the BBB bucket, and as recently as September it was trading 20bps inside BBB- bonds. However they crossed over at the end of that month and now trade up to 50bps wide to the average of the weakest notch of IG.

https://www.zerohedge.com/sites/default/files/inline-images/GE%20vs%20BBB.png?itok=NBrvx6Au

In other words, GE is already trading like junk, and has become the proverbial canary in the coalmine for what many have said could be the biggest risk facing the bond market: over $1 trillion in potential “fallen angel” debt, or investment grade names that end up being downgraded to high yield, resulting in a junk bond crisis.

As Deutsche Bank’s Jim Reid notes, GE’s recent collapse has come at time when much discussion in recent months has been about BBBs as a percentage of the size of the HY market. Since 2005, BBBs have been steadily rising as a percentage of HY climbing back above the previous peak in 2014 (175%) before extending that growth to a current level of 274%. Meanwhile, the total notional of BBB investment grade debt has grown to $2.5 trillion in par value today, a 227% increase since 2009, and now represents 50% of the entire IG index. 

https://www.zerohedge.com/sites/default/files/inline-images/BBB%20as%20percentage%20of%20total%20debt.jpg?itok=PQMc5UWr

Next, to get a sense of just how large the risk of fallen angels in the US is, consider that the BBB part of the IG index is now ~2.5x as large as the entire HY index.

https://www.zerohedge.com/sites/default/files/inline-images/BBB%20par%20vs%20HY%20par.jpg

So large BBB companies – and none are larger than GE – with a deteriorating credit story are prone to additional widening pressure as investors fear the risks of an eventual downgrade to HY and a swamping of paper into that market. This, as Deutsche Bank writes, isn’t helping GE at the moment and may be a dress rehearsal for what happens for weaker and large BBB issuers in the next recession.

Meanwhile, while GE is not trading as a pure play junk bond just yet, it is well on its way as the following chart of GE’s spread in the context of both IG and HY shows.

https://www.zerohedge.com/sites/default/files/inline-images/GE%20spread%20IG%20vs%20HY.jpg?itok=xpv-KlGJ

Which is both sad, and ironic: as Bloomberg’s Sebastian Boyd writes this morning, “the company’s CEOs boasted of its AAA rating as a key strategic asset, but it was more than that. The rating, which it maintained for more than half a century, was symbolic of the company’s status as a champion of American commerce. Now, Microsoft and Johnson & Johnson are the only U.S. corporates with the top rating from S&P.”

And while rating agencies have yet to indicate they are contemplating further cuts to the company’s investment grade rating, the bond market has clearly awoken, and nowhere more so than in the swap space, where GE’s Credit Default Swaps have exploded in recent weeks.

https://www.zerohedge.com/sites/default/files/inline-images/2018-11-13%20%282%29.png?itok=0F9w25ah

What kind of an impact would GE’s downgrade have? With $48 billion of bonds in the Bloomberg Barclays US Corporate index, GE would become almost 9% of the BB universe. And one look at Boyd’s chart below shows that the market is increasingly pricing GE’s index-eligible bonds as junk, especially in the context of the move over the past month.

https://www.zerohedge.com/sites/default/files/inline-images/GE%20bonds%20vs%20BB%2B.jpg?itok=opTII-vm

An additional risk to the company’s credit profile: GE has more debt coming due in the next 18 months than any other BBB rated borrower: that fact alone makes it the most exposed to higher rates according to Boyd.

Meanwhile, GE’s ongoing spread blow out, and junk-equivalent price, has not escaped unnoticed, and as we have been warning for a while, could portend a broader repricing in the credit sector. As Guggenheim CIO commented this morning, “the selloff in GE is not an isolated event. More investment grade credits to follow. The slide and collapse in investment grade debt has begun.”

Then again, Minerd’s concern pales in comparison to what some other credit strategists. In an interview with Bloomberg TV on November 8, Bruce Richards, chairman and chief executive officer of the multi-billion Marathon Asset Management warned that over leveraged companies “are going to get crushed” in the next recession.  Richards also warned that when the cycle does turn, “with no liquidity in the high-yield market to speak of, when these tens of billions or potentially hundreds of billions falls into junk land, it’s “Watch out below!” because there’s going to be enormous price adjustments.”

Echoing what we said above, Richards noted that about $1 trillion of bonds are rated as BBB, as investment- grade, when they has leverage ratios worthy of junk, adding that “the magnifying glass is now shifting” toward ratings companies.

For now the “magnifying glass” appears to have focused on GE, and judging by the blow out in spreads for this “investment grade” credit, what it has found has been unexpected. Which brings us to the question we asked at the top: will GE be the canary in the credit crisis coalmine and, when the next crisis finally does strike, the biggest fallen angel of them all?

Source: ZeroHedge

***

“There Is No Corner To Hide”: $100 Billion Fund Manager Warns Credit Rout Is Just Starting

Without that central bank support and transitioning off the fiscal stimulus, our long-term outlook for investment grade is definitely on the more bearish side over the last two to three years.”

Home Builder Stocks Decline As Fed Hikes Rates And Unwinds

The bloom is off the rose for home builders. Yes, it had been a great run, fueled by The Fed’s zero-interest rate policy (ZIRP) and asset purchases (QE). But despite a roaring economy, SPDR S&P Home builders ETF have been falling since January as The Federal Reserve Open Market Committee (FOMC) sticks to their guns and keeps normalizing interest rates.

https://confoundedinterestnet.files.wordpress.com/2018/10/spdrhbfed.png?w=622&h=448

Yes, the Fed Dots Plot project indicates that there is still upside momentum to short-term interest rates.

https://confoundedinterestnet.files.wordpress.com/2018/10/feddotsplots.png?w=624&h=449

And the Fed’s System Open Market Accounts (SOMA) show a declining inventory of Treasury Notes and Bonds to let mature.

https://confoundedinterestnet.files.wordpress.com/2018/10/somadist.png?w=624&h=449

Source: Confounded Interest

 

Insider Selling Soars In “Cautionary Sign” To Market

One month ago, when Apple finally crossed above $1 trillion in market cap, Goldman’s chief equity strategist David Kostin said that investors had been focusing on the “wrong $1 trillion question”, adding that the correct question was: what amount of buyback will companies authorize in 2018? The reason was that according to the latest estimate from Goldman’s buyback desk, stock buyback authorizations in 2018 had increased to a record $1.0 trillion – a result of tax reform and strong cash flow growth – a 46% rise from last year.

https://www.zerohedge.com/sites/default/files/inline-images/buybacks%20goldman%201%20trillion.jpg

The upward revision was warranted: according to TrimTabs calculations, buyback announcements swelled to a record $436.6 billion in the second quarter, smashing the previous record of $242.1 billion set just one quarter earlier, in Q1. Combined, this meant that buybacks in the first half totaled a ridiculous $680 billion which annualized amounted to a staggering $1.35 trillion, indicating that Goldman’s revised estimate may in fact be conservative.

Furthermore, with many strategists warning that August could be a volatile month, Goldman remained optimistic noting that  “August is the most popular month for repurchase executions, accounting for 13% of annual activity”, implying that a solid buyback bid would support the market in a worst case scenario which never materialized as the S&P rose to a fresh all time high at the end of the month.

https://www.zerohedge.com/sites/default/files/inline-images/buybacks%20goldman.jpg

Based on the Goldman data and estimates, it is probably safe to say that August was one of the all-time record months in terms of buyback activity. That companies would be scrambling to repurchase their stock last month was not lost on one particular group of investors: the corporate insiders of the companies buying back their own stocks.

According to data compiled by TrimTabs, insider selling reached $450 million daily in August, the highest level this year; on a monthly basis, insiders sold more than $10 billion of their stock, the most of any month this year and near the most on record.

https://www.zerohedge.com/sites/default/files/inline-images/insider%20sales%20aug%202018.jpg?itok=EntYYHSK

“As corporate buying is at least taking a breather, corporate insiders are ramping up share selling as the major U.S. stock market averages are at or near record highs,” TrimTabs wrote in a note.

In other words, as insiders and management teams authorized record buybacks, the same insiders and management teams were some of the biggest sellers into this very bid, which one would say is a rather risk-free way of dumping their stock without any risk of the clearing price declining. It also suggests that contrary to prevailing expectations, stocks are anything but cheap when viewed from the lens of insiders who know their own profit potential best.

There is another consideration: September is traditionally the most volatile month for the stock market (especially the last two weeks), and it may be the insiders are simply looking to offload their holdings ahead of a potential air pocket in prices.

As CNBC further notes, September is usually the worst month for stocks, possibly explaining why corporate executives sold so much stock last month. Data from the “Stock Trader’s Almanac” show the S&P 500 and Nasdaq both fall an average of 0.5% in September. The Dow Jones Industrial Average, meanwhile, averages a loss of 0.7% in September.

TrimTabs summarizes this best:

“One cautionary sign for U.S. stocks is that corporate insiders have accelerated their selling of U.S. equities,” said Winston Chua, an analyst at TrimTabs. “They’ve dedicated record amounts of shareholder money to buybacks but aren’t doing the same with their own which suggests that companies aren’t buying stocks because they’re cheap.”

Finally, as we noted yesterday, the September selling may have started early this year in an ominous sign for the rest of the month:

it’s already been a tough start to the month of September for the S&P 500, which has fallen for the fourth day in a row. This is notable, as LPL Financial notes “going back to the Great Depression, only two times did it start down the first four days. 1987 and 2001.

And with insiders dumping a near record amount of stock, it may be the case that the selling is only just getting started.

 

Source; ZeroHedge

Which Emerging Markets Will Run Out Of Money First?

For years, in fact for the duration of the US dollar’s use as a global carry currency, Emerging Markets – especially those with a currency peg – were a welcome destination for yield starved US investors who found an easy source of yield differential pick up. All that came to a crashing halt first after the Chinese devaluation in 2015 which sent the dollar surging and slammed the EM sector, and then again in recent months when renewed strong dollar-inspired turmoil gripped the emerging markets, first due to idiosyncratic factors – such as those in Turkey and Argentina…

https://www.zerohedge.com/sites/default/files/inline-images/turkey%20argentina.jpg

… and gradually across the entire world, as contagion spread.

And while many pundits have stated that there is no reason to be concerned, and that the EM spillover will not reach developed markets, Morgan Stanley points out that the real pain may lie ahead.

As the following chart from the bank’s global head of EM Fixed Income strategy, James Lord, shows, whereas returns have slumped across EM rates, outflows from the EM space have a ways to go before they catch down to the disappointing recent returns.

https://www.zerohedge.com/sites/default/files/inline-images/EM%20returns.jpg?itok=9AdbY0_8

One can make two observations here: the first is that despite the equity rout, EM stocks (as captured by the EEM ETF) have a long way to go to catch down to EM bonds as shown by the Templeton EM Bond Fund (TEMEMFI on BBG).

https://www.zerohedge.com/sites/default/files/inline-images/EM%20equity%20vs%20bonds.jpg?itok=6ljNGxw5

The second, more salient point is that a key reason for the solid growth across emerging markets in recent years, has been the constant inflow of foreign capital, resulting in a significant external funding requirement for continued growth, especially for Turkey as discussed previously.

But what happens if this outside capital inflow stops, or worse, reverses? This is where things get dicey. To answer that question, Morgan Stanley has created its own calculation of Emerging Market external funding needs, and defined it as an “external coverage ratio.” It is calculated be dividing a country’s reserves by its 12 month external funding needs, which in turn are the sum of the i) current account, ii) short-term external debt and iii) the next 12 months amortizations from long-term external debt.

More importantly, what this ratio shows is how long a given emerging market has before it runs out of cash. And, as the chart below shows, if we were investors in Turkey, Ukraine, Argentina, or any of the other nations on the left side of the chart – and certainly those with less than a year of reserves to fund its external funding needs – we would be worried.

So to answer the question posed by the title, which Emerging Markets will run out of funding first, start on the left and proceed to the right.

https://www.zerohedge.com/sites/default/files/inline-images/EM%20external%20funding%20need.jpg?itok=HxscRuEo

Source: ZeroHedge

Visualizing Every US Valuation Milestone From 1781: The Road To A Trillion Dollars

The market has been buzzing about Apple’s $1 trillion market valuation.

It’s an incredible amount of wealth creation in any context – but, as Visual Capitalist’s Jeff Desjardins notes, getting to 12 zeros is especially impressive when you consider that Apple was just 90 days from declaring bankruptcy in 1997.

Today’s chart shows this milestone – as well as many of the ones before it – through a period of over 200 years of U.S. market history. It was inspired by this interesting post by Global Financial Data, which is worth reading in its own right.

https://i0.wp.com/2oqz471sa19h3vbwa53m33yj.wpengine.netdna-cdn.com/wp-content/uploads/2018/08/market-cap-milestones.jpg

Courtesy of: Visual Capitalist

MARKET CAP MILESTONES

Over the last couple of centuries, and with the exception of brief moments in time such as the Japanese stock bubble of 1989, the largest company in the world has almost always been based in the United States.

Here are the major market cap milestones in the U.S. that preceded Apple’s recent $1 trillion valuation, achieved August 2nd, 2018:

Bank of North America (1781)
The first company to hit $1 million in market capitalization. It was the first ever IPO in the United States.

Bank of the United States (1791)
The first company to hit $10 million in market capitalization had a 20 year charter to start, and was championed by Alexander Hamilton.

New York Central Railroad (1878)
The first company to hit $100 million in market capitalization was a crucial railroad that connected New York City, Chicago, Boston, and St. Louis.

AT&T (1924)
The first company to hit $1 billion in market capitalization – this was far before the breakup of AT&T into the “Baby Bells”, which occurred in 1982.

General Motors (1955)
The first company to hit $10 billion in market capitalization. The 1950s were the golden years of growth for U.S. auto companies like GM and Ford, taking place well before the mass entry of foreign companies like Toyota into the domestic automobile market.

General Electric (1995)
The first company to hit $100 billion in market capitalization was only able to do so 23 years ago.

THE OTHER TRILLION DOLLAR COMPANY

Interestingly, Apple is not the first company globally to ever hit $1 trillion in market capitalization.

The feat was achieved momentarily by PetroChina in 2007, after a successful debut on the Shanghai Stock Exchange that same year.

https://www.zerohedge.com/sites/default/files/inline-images/market-cap-petrochina.jpg?itok=F-t3kyGu

And as we noted previously, the $800 billion loss it experienced shortly after is also the largest the world has ever seen.

Source: ZeroHedge