Oracle of Oh-no-maha! An all-you-can-lose Buffett!
"Berkshire Hathaway Declines 100%, Most in at least 36 years.” Warren Buffett probably spat out his Egg McMuffin reading that Bloomberg headline yesterday. But it wasn’t just Bloomberg: Every ticker showed Berkshire Hathaway’s stock — the seventh largest company in the US — in free fall due to a New York Stock Exchange glitch.
Totally unrelated question: Does anybody know where Bane was yesterday?
🧑⚖️ And now the Hunter Biden trial begins
📵 New York to regulate kids' social media feeds
⚾ Glow-in-the-dark baseball looks sweet
–Max and Max
KEY STORY
MrBeast on Top
MrBeast, real name Jimmy Donaldson, now has the world’s largest YouTube channel
Since 2022, MrBeast has been YouTube’s most subscribed-to individual. However, T-Series – which features Bollywood music and trailers – held the record for the most total subscribers to a channel
MrBeast had been closing in on T-Series for months, though, and on Saturday, his account gained a single-day record 2M subscribers, surpassing T-Series. By Monday, he had 270M to T-Series’ 266M. He broke the record after posting a video in which he paid people $10,000 per day that they survived in the wilderness
Dig Deeper
MrBeast is known for hosting massive stunts, such as burying himself alive and creating a real-life version of Squid Game
Many of his videos feature him giving out tens or hundreds of thousands of dollars to participants, strangers, and other people
KEY STORY
GameStop Soars Again
GameStop’s stock price soared after the person behind the 2021 meme stock craze disclosed a $115.7M position in it
Keith Gill led the meme stock frenzy through X account “Roaring Kitty” and Reddit account “DeepF*****gValue” (DFV). Both accounts went silent in 2021
On Sunday, DFV posted on Reddit for the first time since 2021. The post featured a screenshot of his E*Trade account showing a $115.7M position in GameStop
On Monday, GameStop stock spiked 70% before ending the day up 21%. Per the Wall Street Journal, E*Trade, owned by Morgan Stanley, may now block Gill from trading on the site. The platform reportedly believes that Gill’s actions amount to market manipulation
Dig Deeper
The Reddit post came less than a month after Gill began posting a series of cryptic messages on his X account, Roaring Kitty, causing GameStop’s stock price to more than triple in less than a week
That rally was short-lived, though, and by last Friday, its stock price was less than half its recent peak
As of Tuesday morning, GameStop’s stock price is down nearly 8%
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Dig Deeper
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KEY STORY
Fauci Testifies Before Congress
Dr. Anthony Fauci testified before a House committee that is investigating the government’s pandemic response
Fauci rejected accusations that he dismissed the possibility that Covid originated in a lab, saying he kept an “open mind.” He also denied crafting social distancing guidelines – he said those came from the CDC, not his office – and acknowledged that vaccine mandates may have contributed to vaccine hesitancy
Several Republicans accused him of bad policy; Representative Marjorie Taylor Greene accused him of “crimes against humanity.” Democrats praised him, and one called the hearing a “witch hunt”
Dig Deeper
In his opening statement, Representative Brad Wenstrup (R-OH) accused Fauci of making decisions that weren’t based on science, such as six feet of social distancing. Fauci responded that those guidelines “actually came from the CDC,” not from the NIAID, which he led
Fauci also said that while vaccines “hundreds of thousands of lives in the US,” he said the US should “reevaluate” the benefits of mandates, giving the possibility they increased vaccine hesitancy
KEY STORY
Another Unprecedented Time
Jury selection began in the criminal trial of Hunter Biden, making him the first son of a sitting president to go to trial
Hunter – Biden’s eldest son – is an admitted former crack cocaine addict
Prosecutors allege that while buying a gun in 2018, Hunter lied on an official form that he was “not an unlawful user of and addicted to any stimulant narcotic drug.” They allege that Hunter subsequently violated laws prohibiting drug users from owning guns
Many legal analysts say the case is a slam dunk for the prosecution. If convicted, Hunter faces up to 25 years in jail, although as a first-time offender, he would likely receive far less time or no time at all
Dig Deeper
Hunter admitted in his 2021 memoir that in 2018, he was “up twenty-four hours a day, smoking every 15 minutes, seven days a week.” He claims he’s been sober since May 2019
During the trial, prosecutors plan to present a range of text material showing that Hunter was an addict when he bought the gun. His wife – who is in a separate legal battle with Hunter – is expected to testify, as is his ex-girlfriend, who was also his brother’s wife
RUNDOWN
Some Quick Stories for the Office
🥐 Microsoft accused Russia of orchestrating an influence scheme to scare people from attending the Paris Olympics, including by creating “the expectation of violence breaking out in Paris.” Part of that scheme is a deepfake of Tom Cruise in a documentary titled “Olympics Has Fallen”
👨⚖️ A federal court ruled that an Atlanta-based investment firm violated civil rights law by only giving grants to black women-owned businesses
📱 New York’s governor and legislature agreed to a bill that would regulate children’s social media feeds. The first-of-its-kind law would prohibit social media companies from profiting off kids’ data and would attempt to stop them from targeting children with addictive algorithms
🇺🇸 President Biden is expected to sign an executive order to shut down the southern border when there are 2,500+ illegal crossings a day. Those who arrive beyond the threshold would be ineligible to apply for asylum and easier to deport. Donald Trump proposed a similar policy in 2018
🏛️ Louisiana’s legislature approved a bill allowing judges to order the surgical castration of convicted child molesters. Per the bill, a judge can order someone convicted of sex crimes against a child under age 13 to be castrated. If enacted, Louisiana would be the first state to allow that
COMMUNITY
We founded RocaNews because we wanted news companies to give us just the facts – not tell us what to think. That inspires us to do the “Roca Votes” story each week, in which we summarize a controversial topic and see how Roca Nation feels about it.
This week’s question: What gives you the most hope for society? In a world where we read news that is often so dark and twisted, I think we lose sight of the good happening, too.
Suggested by Max from Illinois
It's so easy to think that the world is getting meaner, more dangerous, and more sinful (if you're religious) than ever before. And that might be true. However, advances in medicine and technology have literally doubled average life expectancy in the past two hundred years. Modern entertainment, for better or for worse, has made life a little more interesting. Phones make communication instantaneous. Sometimes I sit back and think, man, I'm so glad I don't live during that span of decades in the 1900s where "The War to End All Wars" ended, the polio outbreak ensued, millions of people died again in WWII, CFCs started absolutely destroying the atmosphere, and then fears of nuclear fallout and mass destruction grew rampant during the Cold War. As crazy as our day is, I think there have been crazier times in the past. And hey, I might totally be proven wrong. Who knows what'll happen. But modern news sources make you feel like the bad news of today is literally bringing about the end of the world, when in reality it's quickly forgotten by the "even-worse" news of tomorrow that still don't stand the test of time when looking at the wider perspective.
I try to remind myself that most people, I think, are trying to be decent human beings. Our society is incredibly disconnected on a personal/communal level, and entirely too connected on a social media/express all your opinions level -- BUT when you give people a chance to feel valued and seen on a fundamental "you are worthy of love because you are alive" level, most people will respond in kind, and the dumb opinions/differences tend to take a backseat. Some may disagree, but I think most people would rather be loved than be right. The potential of "loving your neighbor" gives me hope. I myself tend to be cynical, and try to remember this on the daily commute home:)
I stopped watching legacy news two years ago, that alone has helped my optimism level soar.
POPCORN
Some Quick Stories for Happy Hour
🙏 Vindication: A judge reportedly ordered Corey Harris, the Michigan man who recently went viral for driving during a virtual court hearing for a suspended license, to have his license suspension lifted in January 2022
🪄 A World of Pure Imagination: “Willy’s Candy Spectacular: A Parody Musical,” which spoofs this year’s Wonka Glasgow Experience, released a preview song starring John Stamos
🦇 Bat Girl: A bat bit musician and former “Gossip Girl” star Taylor Momsen while her band opened for AC/DC in Spain over the weekend
⚾ Moon Shots: The Tri-City Chili Peppers, a collegiate summer baseball team in Virginia, hosted the first-ever game of “Cosmic Baseball” — a glow-in-the-dark version of the sport — on Saturday night
🥴 Average Spirit passenger: A 44-year-old New York man received a six-month federal prison sentence for a drunken rampage aboard a Tel Aviv-NYC Delta flight last year
ROCA WRAP
The Wild West
Last week, Nigerian superstar musician Davido launched a new cryptocurrency.
The coin, $DAVID, began trading on May 29. Davido promoted it on his X account, encouraging his followers to “hold,” meaning buy the coin and not sell it, driving up its price.
“HODL HODL! WE ARE JUST STARTING! 30 MILLION SOON COME 🔥⏳✨,” he wrote, referring to his goal of it hitting a $30M market cap. Less than an hour later, he wrote on X, “FUCK IT ! 30 BILLION GANG 🔥🔥🔥”
Other crypto influencers spread word of Davido’s coin, causing a surge in purchases. The coin gained value, reaching a multi-million dollar market cap – until Davido sold his shares, pocketed $474,000, and caused the token’s price to crash 90%+.
Davido’s account subsequently went silent.
Davido isn’t alone with such behavior: Days earlier, Iggy Azalea and Caitlyn Jenner launched their own cryptos, which spiked and then crashed.
Yet while these actions may seem wrong, they aren’t necessarily illegal.
Cryptos generally aren’t overseen by any authority. Instead, a decentralized system verifies and records all transactions. Despite the global crypto market being worth $2.7T – more than the GDP of all but seven countries – cryptos’ legal status is unclear, making them difficult to regulate.
In the US, cryptos fall between two broad classes of financial assets – securities and commodities, each of which is regulated by a different institution.
Crypto’s existence between the two jurisdictions has created a financial “Wild West” – and that is the subject of this week’s deep-dive.
——
In 2021, three people created a crypto called “Squid Game.”
The coin let people play virtual games based on the wildly popular Netflix show. Winners would win real money, enticing investors to buy the coin.
Yet the coin’s developers prevented users from being able to sell their coins unless they won “marbles” in the virtual games. When the coin was launched, though, those games weren’t yet playable, meaning that in reality, nobody could win marbles and sell their coins.
Nonetheless, media hype drove the Squid Game coin’s value from less than $.01 to $2,856.
Then suddenly, the coin’s developers pulled out their shares and walked away with $12M, causing the coin’s value to plummet 99.99%.
Today, that incident is widely regarded as one of crypto’s largest-ever “pump-and-dump” schemes. Yet despite being unethical, the gray area around crypto means it wasn’t necessarily illegal.
Pump-and-dumps occur in two distinct phases.
During the “pump,” scammers hype up an asset, such as a crypto, often by making exaggerated or misleading statements. During the “dump,” major investors suddenly sell off a large chunk of the asset, causing its price to tank.
One crypto-focused lawyer told Roca that unless people outright lie, they likely aren’t violating the law. He pointed to the example of Roaring Kitty, the X user behind the GameStop and AMC memestock frenzy, who constantly hyped up the stocks, causing their prices to rise. Although Roaring Kitty certainly “pumped” the coin – he made repeated statements supporting it – he was simply expressing an opinion, which is protected speech.
Lying is different: If someone buys Apple stock and then publishes a false news story titled, “Apple is about to announce record profits,” that could constitute manipulation of a stock price and, subsequently, fraud.
The same generally applies to cryptos, but because they are unregulated and more prone to hype, there is generally less that can be done to prove or disprove their worth and, thus, determine if somebody is lying or not.
Furthermore, even if outright lying did occur, cryptos’ legal ambiguity means it’s not always clear which agency would have jurisdiction.
But what about other types of crypto-related behavior? And what can be done to clarify cryptos’ legal statuses?
That is the topic of Part 2, which will be featured in tomorrow’s newsletter!
This is part 1 of 2 of a Roca deep-dive into cryptos. If you have questions or comments, reply to this email!
EDITOR’S NOTE
Final Thoughts
Amazing answers to the Question of the Week. We legitimately felt better about the world and its future reading them. Thank you for sending them in — we will be sharing more in the coming days.
Also, happy Hug Your Cat Day to all who celebrate!
–Max and Max
