Good Morning! Stocks suffered their worst day of 2025 as recession fears shook Wall Street. The Magnificent Seven shed $750 billion in Nasdaq’s worst session since 2022, with Nvidia now down 30% from its peak.

Goldman Sachs is slashing economic forecasts over tariff concerns. But M&A activity still remains strong, with Rocket buying real estate platform Redfin for $1.75 billion, and ServiceNow snapping up AI startup Moveworks for nearly $3 billion.

Plus: Elon Musk is tapping private equity veterans to help DOGE at improving Social Security efficiencies, X suffered a “massive cyberattack,” and Coinbase CEO says Trump is the savior of crypto and plans to hire 1,000 U.S. workers.

Could the answer to stock market turbulence already be in your pocket? These guys think so.

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Recession-Proof Profits

The Dow tumbled 900 points yesterday, and the Nasdaq had its worst day since 2022. But while everyone's worried about the losers from tariffs and recessions, there’s one group that is poised to surprisingly do well… private equity. 

It’s been a rough few years for private equity but a weakening economy could be a silver lining for buy-side investors. This might defy logic at face value… private equity thrives in bull markets with high valuations, cheap debt, and easy exits.

But there’s a case to be made that these firms are uniquely positioned to benefit from the current economic uncertainty.

The key reason? Private equity firms have a valuation problem. They overpaid for deals in 2020 and 2021, and have been waiting for valuations to catch up. No one wants to sell at a loss, so they haven’t been selling at all.

And unlike in past downturns, it’s a self-inflicted wound from dealmakers who bought too high and are now frozen.

But today’s murky economic outlook might actually be the nudge PE needs to unclog its deal pipeline. Sell-off losses can be blamed on macro conditions, rather than bad underwriting. LPs could be more forgiving about markdowns if everything is trending down.

On top of that, AI disruptions are forcing tech-focused PE and VC firms to move faster. Some once-promising investments are aging out quickly as AI reshapes industries, making it more urgent for firms to offload outdated bets and reposition for the future.

With markets down, consumer confidence slipping, and the Fed forecasting economic contraction in Q1, a slightly weaker economy might be exactly what PE firms need to justify liquidating bad investments.

Takeaway: Treasury Secretary Scott Bessent recently joked, “MAGA doesn’t stand for ‘Make M&A Great Again.'” But if private equity finally cuts loose its dead weight, he might end up eating those words—just not in the way he hoped. Private equity firms eventually need to distribute, and a lagging economy could be the perfect excuse to start selling existing assets and make way for new ones.

_{PRESENTED BY MODE MOBILE}

Is the best recession-proof asset in your pocket?

The stock market is showing signs of turbulence, and Trump's expected bull run may not be as clear-cut as anticipated.

When the economy goes sideways, smart people have backup plans and investors have recognized that their phones could be the financial lifeline. Mode Mobile is turning the 30+ hours of weekly screen time into real cash for their users, and they’ve already helped 45 million people earn over $325M — zero extra work required.

It’s a business model that can thrive in economic downturns, and they've just locked in their Nasdaq ticker with the goal of going public in the near future.

But you can still get pre-IPO shares at just $0.26 (with 100% bonus shares available).

_HEADLINES

Top Reads

• Stocks suffer worst day of 2025 as recession fears rise (Axios)

• Tech megacaps lose over $750 billion in market cap in worst day for Nasdaq since 2022 (CNBC)

• Dot-com fears resurface in AI boom (WSJ)

• Goldman Sachs downgrades economic outlook amid tariff impact (YF)

• Rocket to acquire Redfin for $1.75B (TC)

• ServiceNow makes $2.85B bet on AI (YF)

• Musk taps private equity veterans to aid DOGE at Social Security (YF)

• Musk goes behind-the-scenes at DOGE, unveils biggest fraud source (Fox)

• Tens of thousands of X users report outages during "massive cyberattack" (Axios)

• Coinbase plans to hire 1,000 U.S. workers (Fortune)

• Passive investing movement gets its Hollywood moment (CNBC) 

• Will private equity destroy Walgreens? (CNN)

• Robotaxis take over Austin (LI)

• One money manager is giving retail investors access to private credit (CNBC)

• Harvard announces hiring freeze (Boston)

• Uber, Lyft get a rideshare rival (TI)

• Greenland in a love triangle between the U.S., Denmark and independence as election takes place (CNBC)

_{CAPITAL PULSE}

Markets Rundown

Nasdaq Drags Stocks Down as Growth Fears Mount

On Monday, equity markets plummeted, with the Nasdaq leading the charge downward, driven by mounting concerns over economic growth.

The Federal Reserve Bank of Atlanta’s GDPNow estimate for Q1 real GDP growth sank to -2.4%, a stark drop from 2.3% in late February, fueled by a spike in imports ahead of potential tariffs and a slowdown in consumer spending tied to weakening sentiment about inflation, income, and jobs.

Though this dip may prove temporary as import trends normalize, the outlook remains shaky, yet a recession isn’t anticipated—pro-growth policies like deregulation, tax cuts, and expected lower interest rates could spark a rebound later in 2025.

Bonds offered a buffer, with U.S. investment-grade bonds up 2.1% year-to-date, while international large-cap stocks rose 10.6%, underscoring diversification’s edge as U.S. stocks retreated from highs.

Investors now eye Wednesday’s CPI report, expecting inflation to ease to 2.9% from 3.0%, with core CPI at 3.2%, driven by cooling shelter costs (down to 4.4% from 6.1% a year ago).

Meanwhile, bond yields dipped, with the 10-year Treasury at 4.22%, reflecting bets on two to three Fed rate cuts as PCE inflation nears 2.1%, paving the way for a less restrictive Fed stance to bolster the economy.

Movers & Shakers

• (+) Redfin ($RDFN) +68% after Rocket Companies acquired the real estate listing company.

• (+) Cracker Barrel ($CBRL) +4% after Truist upgraded the restaurant chain.

• (–) Tesla ($TSLA) -15% because of concerns over demand; a larger post-election selloff.

Private Dealmaking

• ServiceNow bought Moveworks for $2.85 billion

• Rocket Companies bought Redfin for $1.75 billion

• Sun Pharma of India acquired Checkpoint Therapeutics for $355 million

• 4C Medical, a valve replacement device developer, raised $175 million

• Reflection AI, a superintelligence startup, raised $130 million

• Nirvana Insurance, a commercial trucking insurer, raised $80 million

For more PE, VC & M&A deals, subscribe to our Buysiders newsletter.

_{BOOK OF THE DAY}

Becoming Trader Joe

Build an iconic shopping experience that your customers love—and a work environment that your employees love being a part of—using this blueprint from Trader Joe’s visionary founder, Joe Coulombe.

Infuse your organization with a distinct personality and culture that draws customers in a way that simply competing on price cannot.

Joe Coulombe founded what would become Trader Joe’s in the late 1960s and helped shape it into the beloved, quirky food chain it is today.

Realizing early on that he could not compete and win by playing the same game his bigger competitors were playing, he decided to build a store for educated people of somewhat modest means.

He brought in unusual products from around the world and promoted them in the Fearless Flyer, providing customers with background on how they were sourced and their nutritional value.

He also gave the stores a tiki theme to reinforce the exotic trader ship concept with employees wearing Hawaiian shirts.

In this way, Joe laid down a blueprint for other business owners to follow to build their own unique shopping experience that customers love, and a work environment that employees love being a part of.

“Trying to find an optimum solution in business is a waste of time: the factors in the equation are changing all the time.”

_{DAILY VISUAL}

Tesla Gives Up Post-Election Gains

_{PRESENTED BY KNOPMAN MARKS}

Wall Street’s Unfair Advantage For Security Exams

Don’t be like your competition, pulling an all-nighter cramming for the security exam.

Instead, gain the upper hand and study with Knopman Marks, the exam program with the fastest prep-to-pass rate in the industry. 

Trusted by Wall Street’s top firms, Knopman Marks isn’t merely exam preparation–it’s elite career training for high-performers: 

• Equips professionals with proven learning + retention skills

• Taught by industry vets who’ve been-there, done-that

• Personalized training, tailored to any busy schedule 

Ace your SIE, Series 7, 24, 63, 65, 66, 79 and more.

_{DAILY ACUMEN}

Success

Success hinges on crafting a life that fits your unique personality and goals, not chasing someone else’s blueprint.

Talented individuals can shine when free to follow their instincts but falter under rigid systems that stifle their flair—think of creatives losing their edge when boxed into strict rules.

This rings true in finance too: a solid investment plan or spending habit can unravel if it clashes with your comfort zone, as what works for one may torment another, and that’s fine.

Embracing your own path, unshaken by external standards, fuels your best efforts and carves a life that’s authentically yours, showing that true fulfillment beats borrowed playbooks every time.

_{ENLIGHTENMENT}

Short Squeez Picks

• A self-made millionaire’s 5 habits for becoming rich

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• 5 daily habits that build confidence

• Psychological tricks companies use to keep you from canceling subscriptions 

• 3 philosophy classics that are better than self-help books

• How Beyond Meat and the plant-based meat industry lost their allure

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Memes of the Day