Pepsi's Philippines Marketing Blunder & Corporate Bonds Stimulate Markets to Close The Day – Daily Financial News Summary for Monday, June 15, 2020

Stocks were turbulent on Monday, but the three major indexes ended the day in the green. The Dow Jones rose by 0.6, the S&P 500 increased by 0.8 and the NASDAQ climbed by 1.4%. The Federal Reserve announced today that it would be buying corporate bonds in individual companies in order to continue trying to stimulate the economy and provide liquidation. This is in addition to the ETFs that the Fed is already purchasing. The Fed said that it will be purchasing company debt that will become mature in five years or less. In a news release, the Fed said: “[the broader goal is] to create a corporate bond portfolio that is based on a broad, diversified market index of U.S. corporate bonds.” This announcement provided a boost to stocks during the day, causing the Dow to climb by 1,000 points. Hertz car rental company plummeted by over 20% Monday. This was after the company released in a government filing that shareholders are expected to lose all their investment. The company had previously attempted to raise $500 million in equity. Hertz is currently undergoing Chapter 11 bankruptcy. Hertz said that the only way that bondholder debt can be repaid is if consumer activity is suddenly revamped to the amount it was before the pandemic hit. https://callputstrike.com/2020/06/15/corporate-bonds-stimulate-markets-to-close-the-day-daily-financial-news-summary-for-monday-june-15-2020/ Marketing Gone Bad: Pepsi’s Big Philippines Mistake in the 90’s Pepsi, the global CPG company, is well-known among consumers. However, one major event that happened during the 1990s isn’t currently as widely talked about. This event is when Pepsi made one typo that caused fatal rioting in the Philippines. Before The Big Giveaway In the 1990s, Coca-Cola had already broken into the Philippine market. Pepsi knew that they were falling behind and wanted to stay on track with their competitor. The Philippines had a population of over 62 million people at that point, so Pepsi knew that the demand would be there. However, even though the consumer base was large, many people in the Philippines were poor and the economy was struggling financially. The Promotional Event Pepsi’s executives wanted to do something big in order to announce the company was entering the Philippine market. They knew that the vast majority of citizens didn’t have much money, so they decided to opt for a financial incentive. Every Pepsi bottle cap would have a number inside of it. This number would correlate to a prize that would be revealed later on. The plan was to have two winners take home $40,000, while also having many people win smaller amounts. https://callputstrike.com/2020/06/15/marketing-gone-bad-pepsis-big-philippines-mistake-in-the-90s/