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MI
mitchell_lawler
mitchell_lawler
•
14h
MI
mitchell_lawler
mitchell_lawler
•
14h
The Foxhole

The US closed a loophole that helped Temu and Shein. Does that put local retailers back on a level playing field?

📦 Removed loophole: Duty-free shipping under US$800 was suspended and then indefinitely removed.
🛒 Back on equal footing: Undervalued US retailers still forecast to grow.
🧠 Which way does it cut?: A framework for whether regulation helps or hurts an industry.

Cheap factories are the obvious part of Temu and Shein's prices. Another part was a customs rule that allowed parcels under US$800 to enter the US duty-free. This involved shipping each order straight from China as individual items to skip the import duties every US retailer pays. 

It arguably put Temu and Shein on the same footing as domestic stores, which could hand US retail its edge back. However, both are already adapting with US warehouses, and shoppers pay more either way.

Do local retailers actually get their edge back, or do Temu and Shein just adapt?

Recent contrarian ideas

M
mitchell_lawler
mitchell_lawler
•
14h

The US closed a loophole that helped Temu and Shein. Does that put local retailers back on a level playing field?

📦 Removed loophole: Duty-free shipping under US$800 was suspended and then indefinitely removed.
🛒 Back on equal footing: Undervalued US retailers still forecast to grow.
🧠 Which way does it cut?: A framework for whether regulation helps or hurts an industry.

Cheap factories are the obvious part of Temu and Shein's prices. Another part was a customs rule that allowed parcels under US$800 to enter the US duty-free. This involved shipping each order straight from China as individual items to skip the import duties every US retailer pays. 

It arguably put Temu and Shein on the same footing as domestic stores, which could hand US retail its edge back. However, both are already adapting with US warehouses, and shoppers pay more either way.

Do local retailers actually get their edge back, or do Temu and Shein just adapt?

👍🧠🔥
5
7 comments
M
mitchell_lawler
mitchell_lawler
•
1d

Oracle has $638 billion of orders it can't fill yet. Tonight tells us how much it's costing to get ready.

📉 Bullish anyway: The capex is eating the cash, and this author still sees 131% upside.
📋 In someone's top 10: Andre Santos' best 10 stocks to buy.
📊 Before the print: Oracle's fundamentals and estimates.

Part of Oracle’s business is renting out computer hardware. Companies like OpenAI need enormous computing power and would rather rent than own it. But Oracle can only rent out machines it already owns, so before it collects a dollar it has to buy the chips, build the warehouse and connect the power. It burned $23.7 billion in cash doing that last year.

Oracle reports after the close, giving investors another pulse check on just how much cash flow will be shed for the privilege of a large backlog.  

Is this the price you want to be buying at, or is it too early?

👍🥱🔥🤡
13
7 comments
M
mitchell_lawler
mitchell_lawler
•
3d

Razors, glasses, mattresses, all toppled by direct-to-consumer upstarts. Beer wasn't. A 90-year-old law is why.

🍺 The undisruptable aisle: What the three-tier system is, and why it exists.
🚚 Legally required: 9 listed US beer distributors, the middlemen the law mandates.
📊 The protected giant: What the market assumes about AB InBev (BUD) today.

Direct-to-consumer upstarts came for razors, glasses, mattresses and vitamins, and toppled the incumbents in each. Beer? Largely untouched by youthful competitors. The reason is a 90-year-old law. 

After Prohibition, the US split alcohol into three legally separate tiers: brewer, distributor, and retailer. Every beer passes through an independent distributor that takes its cut. The playbook that gutted a dozen consumer categories is simply illegal here.

That raises the drawbridge for the giants. AB InBev (BUD) has the volume to command the best distributors and shelf space, while smaller brewers struggle to get a boozy foot in the door. But the real protected party isn't the brewer, it's the distributor, a legally mandated tollgate that's nearly impossible to fire. 

Is a regulatory moat enough when the market itself is shrinking?

👍🧠🥱🔥
12
10 comments
M
mitchell_lawler
mitchell_lawler
•
4d

The most boring corner of the market just hit a 50-year low against stocks. History says that's when it's worth paying attention.

⛏️ Half a century cheap: Jefferies flags commodities at a 50-year low against stocks.
🏗️ Looking for value: 42 miners and materials producers the market may have wrong.

Jefferies flags that commodities are the cheapest they've been against the S&P 500 in over 50 years. The last two times, after the Nifty Fifty and the dot-com bust, they beat stocks for years. At the same time yields are at two-decade highs, US debt just crossed US$40 trillion, and rising rates could strip pricey AI names of their premium in favour of real assets.

While the crowd piles into AI, the miners and drillers could be the contrarian opportunity. The honest caveat, though, is that there are two variables in this equation… commodities don’t need to rally for the ratio to equalize. 

Are you investing in mining companies or sticking with a different part of the market?

👍🔥
19
15 comments
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