(Washington)

New polls emerging show an interesting picture of how the November election may go. While Biden remains about 5 points ahead of Trump in national polls, what is more interesting is that he holds a 5-point lead in three of the most integral swing states—Michigan, Wisconsin, and Pennsylvania. That is critical because those are the states that trump won in 2016 in order to beat Hillary. If he doesn’t win those states this time around, the odds are very long for a Trump victory.

FINSUM: The state of the economy and the long lockdown seem to be weighing on Trump right now, but there is still six months to go, which is more than enough time for a big swing (in either direction).

A few days ago COVID Loan Tracker launched an EIDL advance tracking survey. After 96 hours, we are alarmed at the results.

Our data is showing that the SBA is not paying EIDL advances on a first come first serve basis, despite that being the bedrock of the entire program. Application numbers are sequential, and are supposed to be paid in order of application.

Please submit your EIDL Details Here to Help Keep the SBA Accountable
 
However, our data is showing that these are not being paid in order, with some applications made days ahead of others not being paid, while later applications are. We now have thousands of data points on this from the survey, but we can further prove this because of when we received (and did not receive) our own EIDL advances. For example, our co-founder Duncan received his EIDL advance on Monday April 27th, with application number 3301458241. However, close friends of the company who applied earlier (and have lower application numbers) have NOT been paid. So not only is crowdsourced data proving this, but there is first party proof.
 
If you have any relevant details (especially in relation to your application timeline versus Duncan’s), please fill out the EIDL survey or email us at This email address is being protected from spambots. You need JavaScript enabled to view it.

(New York)

The stock market is a minefield right now. A lot of stocks have taken big hits. Some have rallied too much, others still have further to fall. There will be further unpredicted consequences of the COVID economy, so the future is not clear for many stocks. So, where to put money? Here is a suggestion—a down and out, beaten up, but promising fast food stock. Take a look at Restaurant Brands (ticker: QSR), which owns Popeyes, Tim Horton, and Burger King. Shares are down 28% since the end of February, and it has stable earnings and plenty of cash on hand to handle expenses. Popeyes is seeing a return to sales growth while Burger King has suspended its COVID-related fall and is starting to move back to normalcy.

FINSUM: We like this stock because fast food chains are likely to hold up well during the recession. The food is cheap and the restaurants are almost tailor made for COVID (i.e. they already have drive-through).

(Detroit)

Auto stocks have been wounded badly by the COVID lockdown. Car sales have plummeted as buyers do not go to dealerships, test drive etc. The future is not looking great either, as a long recession could crimp consumer spending and hit auto companies where it hurts most—on higher margin large vehicles (like SUVs). Interestingly though, a major Ford insider, COO Jim Farley, just picked up $1m of shares in the embattled company. It was his first open market purchase since at least 2007.

FINSUM: This is a really strong signal from a guy who has been with the company for some time.

(New York)

For the last several weeks, the prospect of a meat shortage has been swirling around the media and markets. However, it had not really become a tangible reality—until now. Wendy’s is apparently running very low on meat, with around 20% of their stores out of beef. Costco is running out of meat too, and is limiting purchases. Meatpacking companies have been suffering too, as their volumes are down.

FINSUM: Trump has already invoked the Defense Production Act to ensure the meat supply, but it is still facing shortages. Something to keep an eye on for restaurants and grocery stores.

(New York)

An update to the SEC’s FAQs page has made something abundantly obvious—the title of “advisor” or “adviser” is about to get a lot more contentious. As part of its new Reg BI package, the SEC is bringing in additional rules around the use of titles. Regarding “advisor”, which is completely ubiquitous, the new rules are pretty clear: you cannot call yourself an “advisor” or “adviser” unless you are registered as an investment advisor. Another important note on this, according to Barron’s, “Broker-dealers that are affiliated with RIAs are generally prohibited from using the terms”.

FINSUM: This is a huge disruption to the lingua franca of the industry, but a big boon to investment advisors. Makes us wonder how much the public will actually care.

(New York)

The last couple of trading days have thrown cold water on that bullish trend that sent the market soaring all April. Weak earnings and huge job losses took their toll, and the reality of a slow-slog recovery are weighing on markets. With that in mind, a former Goldman Sachs fund manager, Will Meade, says that stocks are going to fall another 40% from here. Meade argues that this year will be just like the 2000 dotcom bubble: “The Nasdaq in 2000 did a similar bear market bounce as stocks this year — dropped 40%, then bounced 42% off the bottom retracing 61.8% of its drop. It stalled then fell 43%, making a new low four months later,”. Similar to 2000 is that fact that there is additional uncertainty this year created by the election.

FINSUM: This is far from implausible. As the reality of how hard this recovery might be sets in, markets may completely abandon their exuberance.

(New York)

New data is out showing which independents are gobbling up the most new recruits in the wealth management space. The overall picture emerging is that while April was a very slow month for changes, Raymond James and LPL are striding ahead of the competition through acquisitions and advisor recruiting. LPL has gotten 59 new recruits to join this year, while Raymond James has managed 20, worth $4 bn and $2.8 bn in AUM respectively. Some usual suspects have been absent so far this year. For instance, Advisor Group has lost more than 25 advisors to LPL in 2020 without announcing a single new advisor joining the network.

FINSUM: LPL and Raymond James have done a great job keeping their recruiting wallets open during this tough time. We expect the relationships they are building right now will keep their pipeline strong for the rest of the year.

(Atlanta)

If you have any hope for a quick airline recovery post-coronavirus, take that idea, crumple it into a little ball and throw it away. The reality of air travel’s recovery is looking bleaker by the week. On the one hand, additional safety measures are going to be necessity for a long time—and they will be costly. Extra screening, spacing out passengers etc all have significant costs. Additionally, many airlines will have to forego middle seating to create adequate distance between passengers, cutting down on capacity. All of this will come as demand for air travel remains low in the short-term and secularly weaker in the long-term. For instance, business travel for meetings, conferences etc all looks likely to be very slow to recover because companies don’t want to put their workers in harm’s way. Videoconferencing has also proven very effective.

FINSUM: There is likely to be a big clearing out of weaker airlines and several years of losses/less profit for larger ones.

The Paycheck Protection Program landscape has been beyond challenging for small business owners. According to COVID Loan Tracker, as of April 30th, only 10.2% of small business owners report actually receiving PPP loans. That compares to the 30% that say they have already received “approval” for the loan by the SBA. That is a huge lag when you are trying to pay employees.

However, for some, that is not even the biggest issue, as just applying itself is a major headache. Not only are the forms one must submit difficult, but many banks won’t let you apply if you are not a customer, so many are stuck in seemingly hopeless queues at giant banks. With that mind, below is a list of sources where you can apply WITHOUT being a customer.

1. COVID Loan Tracker has partnered with Fundera to offer its own PPP app. Applying with online lending platforms like Fundera increases your chances of success because they are connected to a multitude of lenders and only place your application with banks ready to process them. CLT can see in its data that online lending platforms have had very high success rates in getting PPP loans approved.

APPLY FOR PPP with COVID Loan Tracker/Fundera

2. First State Bank: https://1st.bank/ppp/
3. Banc First: https://www.bancfirst.bank/cares/ppp-apply
4. Eastern Bank: https://www.easternbank.com/ppp-request
5. People’s Bank and Trust: https://www.peoples.bank/ppp
6. TCF Bank: https://commercial.tcfbank.com/sbappp/s/application?

COVID Loan Tracker was started by small business owners Duncan and Rita MacDonald-Korth to help their fellow small business owners understand where PPP and EIDL money is flowing. We are empowering the business community and journalists with the data they need to keep the government accountable.