Click here for the PDF: The Weekly Beacon – April 28 2023

We will be giving some macro economic market updates on a weekly basis. No equity recommendations will be given in this commentary, and we encourage you to contact us if you have questions regarding any observations.

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This weeks issue: Bed Bath & Beyond, Bankruptcy, Chapter 11, Home furnishing sector, Chamath, SPACs, SPAC King, Bitcoin, Bulls vs. Bears, Cryptocurrency industry, Regulation, SEC, Gary Gensler, SVB, Pension giants, Ontario Teachers Pension Plan, Chinese stocks, Geopolitical risk, Tesla, Tesla sales, Electric vehicle market, Competition in the auto market.


Bed Bath & Beyond files for Bankruptcy

After months of avoiding bankruptcy, Bed Bath & Beyond filed for Chapter 11 protection on Sunday. The company seemingly threw in the towel after months of effort.

The bankrupt retailer was once a favorite for retail traders. Bed Bath & Beyond partook in the 2020/2021 short squeezes where retail traders piled into heavily shorted stocks. Coincidentally all these heavily shorted companies were companies they knew quite well. These young retail investors grew up going to GameStop to buy video games, going to AMC to see a movie in theatres, and buying towels or a candle at Bed Bath & Beyond. Fast forward 10 years and we have the age of e-commerce as well as the streaming industry.

Bed Bath & Beyond shares soared post-financial crisis quadrupling in price between 2009 and 2015. Since then, shares have plummeted, shares were down 37% on Monday. Bed Bath & Beyond’s market capitalization was once $17 billion and is now sitting below $100 million. (The short squeeze we were talking about earlier is represented by the yellow portion of the chart below. Shares increased from $5 to $30 over this period.) After Sunday’s Chapter 11 filing, Bed Bath & Beyond shares are down 82% since its mid-1990s IPO.

Click here for the PDF: The Weekly Beacon – April 28 2023