Perceived as pursuing quantity over quality until now, all this could be about to change over at the House of Mouse as Disney has reinstated former CEO and acquirer-extraordinaire, Bob Iger. His return was greeted with rapturous applause as Disney employees and shareholders alike rejoiced to see the prodigal son return to right a lilting ship. But nobody is happier than Bob’s wife, Willow Bay, who reportedly told him to return as the CEO of Disney, so that he wouldn't run for US president. You and us both, Willow.

The lowdown

• 🔌 BP is doubling down on hydrogen as it looks to alternative fuels for the future.

• 🏠 The German housing market has been remarkably strong for decades, but it faces a serious fall in prices over the next couple of years.

• 🛢️ OPEC could impose deeper oil output cuts as it weighs the impact of a pending ban on Russia’s crude exports and a possible price cap on Russian oil.

Flex your finance muscle 💸💪

Last Tuesday, we discussed the ongoing possibility of a dead cat bounce playing out, following the Thanksgiving shopping weekend.

So let’s dig in a little deeper into what that means.

Here’s a quick reminder of what a dead cat bounce is: a brief and small recovery in the price of a falling stock – based on the idea that even a dead cat will bounce if it falls from a great height.

Dead cats and the sucker rally

2022 has been psychologically damaging to investors all around the world, leaving many questioning every single piece of financial news.

Just look at the Google News results when you search ‘dead cat bounce’:

The buzzword headlines are endless, but the most important thing to know about a dead cat bounce is that it’s just another type of sucker rally.

In a "sucker's rally", investors send the markets higher as they clamor to buy stocks. Unfortunately, the rally tends to be short-lived, and investors who bought in at the top are left holding the not-quite-so-valuable-anymore bag.

To avoid discussing crypto for just one day, let’s look at the Peloton example. Down almost 50% since it went public in September 2019, the company isn’t growing. It is nowhere near profitable, user growth is disappointing, losses increased from $376 million to over $408 million, and free cash flow was negative $246 million in the most recent quarter.

Despite all that, it is currently enjoying a rare hot streak, up 33% in the last week as investors ‘buy the dip’. Not for any fundamental reason, simply because it looks like a good price.

Smells of dead cat to me – watch it fall once more when Q4 numbers released.

Featured stories

Rematch of the week: USA versus The Netherlands

Not content with knocking the US out of the World Cup last week, it looks like an even greater divide may be growing between the European canal-builders and the world’s largest economy.

At the center of this ongoing feud is global chip firm and Dutch-based powerhouse, ASML, which is weighing up its options in trading with China – a big no-no from a US point of view.

The Eastern superpower is keen to get its hands on ASML’s second-to-none, high-tech chip-making machine, while the Western superpower wants to prevent just that. The US has cited the dangers of China developing the most advanced semiconductors in the world, which have extensive military and advanced artificial intelligence applications.

Up until now, the Dutch have been happy to listen to their American pals, but the ever-worsening economic situation in Europe and the ongoing war in Ukraine has made things complicated.

“Obviously we are weighing our own interests, our national security interest is of utmost importance. Obviously we have economic interests, as you may understand, and the geopolitical factor always plays a role as well,” said Liesje Schreinemacher, minister for foreign trade and development cooperation of the Netherlands.

With a 3-1 defeat in the World Cup fresh in their minds, expect to hear more about this ongoing rift, which could have very un-funny implications for US-EU trade, should the Dutch decide to open up a direct line to China once more.

The content we're consuming today

• The Economist: Is a white-collar recession looming? ($)

• FT: UK employees to be given more flexible working rights

Off-balance sheet items

• Given the underdog nature of the Qatar World Cup so far, perhaps the gamblers among us could look at these key stats, which highlight the probability of both Spain and England doing very well this year.

The bottom line

Thinking about deleting Twitter? This may be the impetus you need!