| Hackers pounce, bulls roar back and the $1.9 trillion stimulus plan is coming. Somebody's watchingAn international hacker collective says it breached a massive trove of security-camera data collected by Silicon Valley startup Verkada Inc., gaining access to live feeds of 150,000 surveillance cameras inside hospitals, companies, police departments, prisons and schools. Companies whose footage was exposed include carmaker Tesla Inc. and software provider Cloudflare Inc. Tillie Kottmann, one of the hackers who claimed credit, explained their motives as "lots of curiosity, fighting for freedom of information and against intellectual property, a huge dose of anti-capitalism, a hint of anarchism -- and it's also just too much fun not to do it." License to rally The drop in Treasury yields after the recent violent run-up gave risk assets license to rally again on Tuesday. With rates on the rise, stretched valuations had started to look scary. But in an epic reversal, the Nasdaq Composite Index gained more than 4%, while Tesla Inc. saw its market cap expand by some $100 billion, nearly equivalent to the market value of BlackRock Inc. Ten-year benchmark yields are below 1.6% following their one-year high breached last week, but with massive fiscal stimulus underway and a growth bump likely to follow, rates will remain under pressure. Nearly there With four days until supplemental unemployment benefits begin running out, House Democratic leaders expect to pass Joe Biden's $1.9 trillion pandemic relief package Wednesday morning. Economists have upped their projections for growth to incorporate the impact. Morgan Stanley raised its 2021 forecast for U.S. economic growth to 7.3% from 6.5%, a pace unsurpassed since the Korean War boom. The OECD on Tuesday more than doubled its 2021 U.S. growth forecast as it incorporated the latest aid package. Markets mixedThe rally in the technology sector appears to be losing steam with Nasdaq 100 futures drifting after Tuesday's surge. Gold steadied after posting the biggest jump in two months and bond yields edged higher. Overnight the MSCI Asia Pacific Index rose 0.3% while Japan's Topix index closed 0.1% higher. In Europe, the Stoxx 600 Index was flat at 5:32 a.m. Eastern Time. S&P 500 futures were fluctuating. Coming up... The big data report for the day is CPI, with February's jump in gas prices expected to send year-on-year inflation to 1.7%. The ECB starts its two-day policy meeting. No Fed speakers are scheduled. The U.S. Treasury auctions $38 billion of 10-year notes, the second of three debt sales this week totaling $120 billion. Oracle Corp. and Campbell Soup Co. are among companies reporting results. What we've been readingThis is what's caught our eye over the last 24 hours. And finally, here's what Joe's interested in this morningYesterday I wrote about how the standard story on the Fed printing money that then somehow goes to entrepreneurs doing speculative ventures was totally wrong. But it does raise the question: Where does the money actually come from? That's a fair one and it deserves an answer: It comes from Carbone, the high-end Italian restaurant in Manhattan's Greenwich Village. That's not a joke. On a recent episode of our podcast, Tracy Alloway and I were interviewing the investor Howard Lindzon, who recently launched his own SPAC, the Social Leverage Acquisition Corp. And when he talked about where the idea to do a SPAC actually came from, he told us:
"My last pre-Covid memory of a fun time was at this incredible restaurant at Carbone, which is like an institution for some reason in New York, which is a hard-to-get-into Italian place, and I was sitting at a table with Adam Bain (former Twitter COO)... there were two things you talked about at the time with Adam Bain. We were talking about what the hell was going on with this Covid thing, and what is this SPAC that you speak of. Everybody was talking about Virgin Galactic, which was an Adam Bain production with Chamath that was done by SPAC... he took the time to walk us through how Chamath was thinking about SPACs."
One thing led to another and after this dinner conversation, eventually Howard did in fact launch a SPAC. And more people had versions of the same conversation (probably over Zoom) and so on and so on. And now we have this tidal wave of SPAC issuance. And now we have flying taxi companies that have billion dollar valuations despite no product. And we have all of this capital flowing into battery and EV companies through SPACs. And everybody wants a piece of the action. And a bunch of people are going to get very rich out of it and so on. Oh, and even Sammy Hagar of the band Van Halen is involved with a SPAC.
And then at some point, presumably, a bunch of these companies will flop, the cycle will retrench, the money will be less free-flowing, and what once was an expanding supply of money and wealth will start to shrink. But the point is that it's an organic process with the cycle of risk appetite -- a phenomenon that's only partially related to any monetary or fiscal policy.
This is what we're talking about when people talk about endogenous money.
Expansionary policies can help of course. But in the end it's the dinners at Carbone and the games and the celebrity FOMO that create the new money from within. And of course it's not just SPACs, but VC deals, and stock market booms and real estate and any other boom-bust cycle that involves the interactions of humans. That's what determines how much money is out there or not out there at any given moment.
Joe Weisenthal is an editor at Bloomberg. | 
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