Morning Brief: Value’s year, but growth's quarter

Myles Udland breaks down Thursday’s Morning Brief, which details the wild first half of the financial market, which included: the rise of meme stocks, the price of Bitcoin topping $60,000, the uptick in demand for products in short supply, and many more impactful events.

Video transcript

BRIAN SOZZI: As you mentioned, we are now in the second half of the year. The year is absolutely flying by. And that's where we find new writing today in this morning's "Morning Brief." Wow, we saw a whole bunch of very interesting developments in the first half of the year. We talk about it each day. But-- and you lose track of some of the things that, in fact, happened. But there were some big moments.

MYLES UDLAND: Yeah, and, you know, it's always fun to kind of use the end of the quarter or the end of a half year to look back on what actually all went down. And, you know, on this show, right, our job is to come on here, talk about the stories of the day, basically get excited about whatever's happening on any one day. Sometimes that news is, indeed, exciting. Other times, you know, we're just trying to make lemonade here.

But when you look back at the first half of 2021, it really was a momentous year. And you have to start with the meme trade, which came up two separate times. But of course, the January, February period, where AMC-- GameStop, really-- center of the action. You have the Melvin Capital blow-up. You have Keith Gill, Roaring Kitty, getting his blow-up. [INAUDIBLE] gets in the mix there at one point. GameStop shares, which, again, we talk so much about what makes a meme name.

And Sozzi, you've reiterated time and again, really, it's got to be-- part of that equation has got to be it's a consumer name, a name that people know and recognize. GameStop certainly fit that bill. The stock is still up 1,000% this year, even with-- whether it was a 90% drop, I think at one point, from its highs.

Right around, when you look at the lows there in February, it was right around the time that Congress held a bunch of people, including Ken Griffin, in front of the House Financial Services Committee to kind of explain what all went down during that period. Vlad Tenev, CEO of Robinhood, was there as well. So GameStop shares, they're up 1,000% this year. AMC shares, the rallies have been crazy. That stock's up 2,000%, more than 2,000% so far this year. So the meme trade, I think, is really the defining event the first half of the year, 2,500% gain so far this year.

But, you know, you even go through what happened in the crypto market. 60,000 on Bitcoin, then Bitcoin gets cut in half. Elon Musk is out there pumping Dogecoin. Even today, he's tweeting about Dogecoin, although Dogecoin didn't really do anything on the move. Elon hosts SNL in early May.

Warren Buffett lets it slip who the next CEO of Berkshire Hathaway is going to be. That's going to be Greg Abel, who's currently running the operations side of Berkshire Hathaway. Call it the industrial side of Berkshire Hathaway. Anything that isn't insurance is under Greg's purview. And Greg is going to most likely be the next CEO of the company.

Then we had the commodities trade, the inflation trade. Lumber a big part of that, but we talked with Jared Blikre earlier this week about all the different commodity rallies and cooling off that we have seen so far this year, which gets to the inflation prints we've seen. I know that has you quite excited, Brian Sozzi, multi-decade highs for core inflation. Since 1992, before Brian Cheung was even born, we haven't seen core CPI increasing at this level.

And in the backdrop of all this, you've got shortages of everything, which we outlined some of those stories, which we've discussed-- rental cars, used cars, chlorine, which is a fan favorite around here. You don't have enough planes. You don't have enough people to fly the planes. You don't have enough people to staff the planes. You don't have enough trucks or truck drivers to drive the trucks. It's a shortage of everything. And that's also been the story of this recovery.

And it just really couldn't be a more interesting to me, Sozzi, six months of the year. I think it'd be nice if we didn't have such an eventful next six months. We're still in a pandemic. We're still seeing vaccines roll out. There might be as eventful, but it just seems unlikely.

We've got a new president. I didn't even mention that in the "Morning Brief." We had a change in power. And we had the insurrection at the Capitol at the beginning of the year. So that stuff didn't even come up in the Morning Brief. It's really just been an amazing six months. And I think it'd be nice if it cooled off a little, right?

BRIAN SOZZI: Well, it certainly has made it fun each morning, more fun than it normally is, Myles. But also for new viewers, worth noting here, our senior Fed correspondent Brian Cheung was born in 1993.

And the interesting thing here is that, Myles, some of these stories that you mentioned in the "Morning Brief" newsletter, they're not going anywhere any time soon. I mean, some of these things are going to be the defining events and moments of the investing community probably over the next decade. Look, the meme trade, that's not going anywhere. The rise in retail investors, that stuff is here to stay.

And Myles, one development you just mentioned that I don't think really got enough play-- it should have got a lot more play-- Warren Buffett over at Berkshire Hathaway and tipping his hand on who the potential successor is. You and I have grown up covering Warren Buffett, perhaps you more so than me, writing about Warren Buffett, taking in his investing wisdoms. But the next five years at Berkshire Hathaway are going to look a lot different than the past, what, 40 or 50 years at Berkshire Hathaway.

MYLES UDLAND: Yeah, I think so. I think it was said that five years ago. And indeed, there have been some changes over that period of time. But I think, Sozzi, that's also a great example of just how much other crazy stuff has been going on in the market that Warren Buffett signaling who his successor will be becomes-- I think I highlighted it in the brief today because it's something that I think about more than most people.

But I'm not sure that too many market participants care that much about it, even registered that it happened. Because there is, as you mentioned, so much else happening in the market. And I think, again, everyone uses the word-- has used the word "unprecedented" because, obviously, none of us have ever lived through a global pandemic and the scale and changes it has brought. And I mean, look, we're still broadcasting from home. That will change in the second half. We're going to go back to the studio.

So, like, all these things have uprooted so many different parts of our lives. But even within financial markets, things have changed at a pace that really hasn't been seen, at least as far as I can remember in my career, Sozz. And I think it relegates things like the monumental decision on who will take the reins at Berkshire Hathaway to the third page, the fourth page of a recap, right? Something like that when you kind of take the flavor of what were the defining moments of the last six months of markets.

And we mentioned Elon Musk hosting "SNL." We didn't even talk about Tesla, which, at one point, was approaching a $1 trillion valuation. The company has had its own kind of maturation here, where we talk now about just regular old beats on top and bottom line. We didn't talk about the auto trade, which has been on fire this year, the electrification of America's auto fleets, so on and so forth.

So we could go all day on this. We need not at this point. And we should move on. But I think, again, just a reminder of how interesting the first half of the year really was. And I doubt, highly doubt that at the end of December, I will be able to write something similar about the second half of 2021. So what I'll do is probably just repurpose today's newsletter, call it a year recap, and be done there. Because no one wants to work late.

BRIAN SOZZI: You're a veteran, Myles. I was just-- I was just thinking that.

MYLES UDLAND: I mean, come on.

BRIAN SOZZI: Cut and paste. Come on.

MYLES UDLAND: Yeah, how easy is that? No one wants to work late on New Year's Eve, so we won't. We already have a preview of the December 31, 2021 "Morning Brief" newsletter that you can find in your inbox.