__13th time’s the charm…__ Is it though? __[Apple](https://robinhood.com/stocks/AAPL)__ dropped a new iPhone at its [launch event](https://www.cnbc.com/2021/09/14/apple-event-iphone-live-updates.html) yesterday, but Fruit-heads hoping for dazzling news iProducts may be disappointed by marginal upgrades. A few highlights: 

- __Oscar-level selfies:__ iPhone 13 features improved cameras with cinematic video features, better graphics, and a bigger battery. Price didn't budge: still $799 for the mid-range — or $33/month in installments. 
- __Fewer ways to lose your stuff__, thanks to new accessories, like a leather MagSafe wallet that connects to Apple’s “Find My” network.
- __More ways to sweat__ using the new Apple Watch 7, including Group Fitness classes, a calorie tracker for indoor cyclists, and a new crash alert system for outdoor bikers. 

__The apple of Apple's eye…__ Still iPhone. iPhone sales make up over half the Fruit's total, though they slowed in 2019 and 2020. This year, sales soared as the new 5G-enabled 12 fueled an upgrade cycle. While iPhone sales have slowed quarter-to-quarter, Apple is hoping the new model + jacked-up services will rev up demand for its precious hardware. 


_It's a bigger battery [Klaus Vedfelt/DigitalVision via GettyImages]_

Club

__Easier to walk in, harder to leave…__ By keeping iPhone prices flat and offering accessible installment payment options, Apple’s making it easier to walk into “Club Apple.” And it's making it harder *to walk out*. Apple is expanding its connected ecosystem, getting customers hooked on original content like *Ted Lasso* and services like Fitness+. That way, the world’s most valuable company could continue growing with some relatively simple additions.

The iPhone 13 may not be a jaw-dropper, but it's still getting harder to leave Club Apple

__Lay down the stats…__ Hispanic and Latino Americans are still far from the pandemic recovery finish line. The community has been disproportionately affected, both from economic and health standpoints. Latinos account for [over half](https://www.nbcnews.com/news/latino/latinos-account-half-countrys-population-growth-rcna1667) of the US' population growth over the past decade, and make up ~18% of the total population — but represent nearly [30%](https://www.tampabay.com/news/2021/08/05/new-study-affirms-that-pandemic-hits-hispanics-harder-than-others/) of coronavirus cases.

__The pandemic effect…__  Hispanics have a [higher](https://www.cnbc.com/2021/08/06/unemployment-rate-falls-but-is-higher-for-black-and-hispanic-workers.html) labor force participation rate than any other US demographic. But Covid sparked a sharp surge in unemployment — and the economic effects still linger today. That’s partly because Latinos are disproportionately represented in industries that were hardest hit, like restaurants and hotels. With Hispanics already earning [26%](https://www.cnbc.com/2021/08/06/unemployment-rate-falls-but-is-higher-for-black-and-hispanic-workers.html) less than their white counterparts pre-pandemic, elevated unemployment has been even harder to endure financially. 

- __Today:__ While the Latino unemployment rate is falling, it was [6.4%](https://www.cnbc.com/2021/09/03/black-unemployment-rises-in-august-jobs-report.html) in August — compared to 4.5% for white Americans, 4.6% for Asian Americans, and 8.8% for Black Americans. 
- __Still…__ Over the course of the pandemic, Latinos have become [more optimistic](https://www.pewresearch.org/race-ethnicity/2021/07/15/for-u-s-latinos-covid-19-has-taken-a-personal-and-financial-toll/) about the country's direction and the situation of US Latinos.  
- __As one of the largest and fastest-growing__ populations in the US, the Latino community has seen major economic growth over the past decade.


__There's more growth ahead…__ Hispanic Americans saw [faster](https://www.bloomberg.com/opinion/articles/2020-10-06/hispanic-american-incomes-rising-faster-than-any-other-group-s?sref=q3KSFp38) income growth than any other major demographic group from 2014 to 2019. Despite pandemic challenges: in the past two-years, Latino-owned businesses grew revenue at an average rate of [25%](https://www.nbcnews.com/news/latino/latino-owned-businesses-are-seeing-record-growth-big-banks-are-n1256884) per year, vs. 19% for white-owned businesses. The young and educated Latino labor force is expected to continue driving growth for the US economy. Case-in-point: If the US Latino market was its own country, it'd be the [8th-largest](https://www.forbes.com/sites/seansalas/2020/09/27/the-26-trillion-us-latino-market-the-largest-and-fastest-growing-blindspot-of-the-american-economy/) economy in the world. 


The pandemic effect on Hispanic Americans: looking back, and looking forward

Dow Jones

S&P 500

Nasdaq

Bitcoin

🍎 Apple's new(ish) gadgets

__VIP pug life…__ A bombshell WSJ [report](https://www.wsj.com/articles/facebook-files-xcheck-zuckerberg-elite-rules-11631541353) revealed __[Facebook](https://robinhood.com/stocks/FB)__ rolled out the moderation red carpet for at least 5.8M celeb users — including Donald Trump, Elizabeth Warren, soccer star Neymar, and even Doug the Pug. The drama revolves around a secret program known as “XCheck,” which shields millions of VIP users from FB's normal moderation process — kind of like an invisible verified badge. 

- __For "regular" users,__ AI usually scans posts for rule-breaking content and quickly removes it if there’s an infraction. Meanwhile...
- __XCheck accounts__ are placed on a "whitelist" that allows them to post without the same level of scrutiny or repercussions (the moderation equivalent of bottle service).

__Reporting politicians...__ It happens. Famous people get reported more than Berta from Oregon, even if their posts aren't flag-worthy. XCheck was conceived as a quality-control measure for actions taken against these high-profile accounts. 

- __The problem:__ XCheck only reviewed A-lister content *less than 10% of the time*, according to WSJ. For example: In 2019, Neymar posted naked images of a woman who accused him of sexual assault. 
- __Due to XCheck bias,__ 56M Facebook and Insta users saw the post before it was finally removed. While FB admits XCheck has flaws, it’s still not technically liable for its users' posts because of [Section 230](https://snacks.robinhood.com/newsletters/34Yw0kPPDSo5aJBnQRKCXN/articles/5pdRGmSLIP5qovztp6wkY/). 


_XCheck status [Hill Street Studios/Stone via GettyImages]_

Celeb

__This drama adds fuel to the fire…__ the *big*, familiar fire. Social giants like FB and __[Twitter](https://robinhood.com/stocks/TWTR)__ have been accused of letting abusive content run rampant, not applying moderation policies equally, and acting more like editors than social platforms. The mishandling of XCheck gives ammo to legislators who’ve argued for years that social giants should bear more liability for users' posts. TBD if they ever will.

Facebook's secret moderation program exempts some celebs from usual posting restrictions

__A taxing weekend…__ House Democrats [proposed](https://www.wsj.com/articles/democrats-release-details-of-tax-increase-11631539532) a plan to raise up to $2.9T in tax dollars over the next 10 years, the biggest tax hike in decades. The goal: pay for Biden’s ambitious $3.5T plan to expand America’s social safety net and combat climate change. Lawmakers plan to vote this week on the proposals. Whose taxes would be affected:

- __Individuals__ who make $400K+ per year and married couples that make $450K+ would pay higher taxes on income and capital gains — nearly 40% on income vs. the current 37%.
- __Corporations__ that make more than $5M in income/year would pay a 26.5% tax rate, up from  21%.
- __Small businesses__ that make less than $400K/year would pay *lower* taxes (18%). 

__9 am hike up Capitol Hill…__ Expect some sweat. Democrats don’t need Republican support to pass the plan — but they’ll need just about every Dem vote. Progressives are committed to the plan, even though the tax hikes aren’t as high as Biden's original pitch. But some moderates like Joe Manchin aren’t sold. 

- __Pros:__ The plan could raise trillions of dollars to rebuild America's aging infrastructure, fight climate change, invest in public housing, and expand public education.
- __Cons:__ It could stifle economic growth — think: reduced corporate hiring and investment. The US could also [lose](https://snacks.robinhood.com/newsletters/2FGYY02td4t3rp9KjKvLQM/articles/1d7eiIZp8iwgUI9aKXGIQZ/) corporate investment activity to countries with lower tax rates. 

Hike

__Higher corporate taxes = lower corporate profits…__  which could mean falling stock prices, at least in the short term. Stocks soared in 2017 when ex-President Trump cut corporate taxes, making companies more profitable overnight. Biden’s tax increase would partially roll back those cuts, reducing the cash companies keep as profit. Since stock prices often reflect investors’ expectations of future returns — think: dividends, cash flow, rising prices — lower profits could mean lower expectations.

Dems propose $2.9T tax hike for high earners and big businesses to pay for Biden’s $3.5T agenda

⭐️ Facebook's secret celeb list 

__ABC, easy as…__ ESG? Socially responsible investing, aka ESG (or environmental, social and governance) investing, has boomed recently. ESG criteria — like a company’s enviro-impact, board diversity, and/or exec compensation —  is used by some firms and investors to evaluate companies for funds or personal portfolios. S&P Global, Bloomberg, and Moody’s are a few of the companies that rate and measure ESG performance.

__Spell it out…__ Like with most stock purchases on public markets, people aren’t *directly* funding ESG-conscious companies when they buy their stock. But investors gain voting rights that could help companies make better decisions. Increasingly, people are using their values and ethics to guide investment choices — especially Millennials. 

- __10X:__ Investors contributed $51B to sustainable funds in 2020, compared to less than $5B five years ago.
- __90%__ of Millennial investors say they believe in sustainable investing, according to a 2019 [report](https://www.morganstanley.com/pub/content/dam/msdotcom/ideas/sustainable-signals/pdf/Sustainable_Signals_Whitepaper.pdf).
- __$285B:__ How much ESG funds [grew](https://qz.com/guide/esg/) last year — nearly double their 2019 value. 

__Lean in to green…__ This month, the SEC said it may require companies to report climate-risk info along with their annual earnings. Think: emissions metrics and progress toward climate goals. In recent years, companies have been doubling down on ESG initiatives — *especially* environmental ones. Big Tech companies are the largest allocations for most ESG funds. __[Amazon](https://robinhood.com/stocks/AMZN)__ pledged to become carbon neutral by 2040, __[Microsoft](https://robinhood.com/stocks/MSFT)__ committed to become carbon-negative by 2030, and __[Google](https://robinhood.com/stocks/GOOG)__ bought enough wind and solar energy in 2019 to power 500M European homes.


_Up close and personal with ESGs [David Trood/ DigitalVision via GettyImages]_

__The next step in ESG is validation…__ Many aspects of ESG investing still aren't well-defined. Dozens of sources share company ESG scores, but many use different criteria that can be tough for companies to measure. It can also be hard to measure ESG investing’s impact: One study found that increasing ESG investment didn't lead companies to reduce pollution, or improve workplace safety or board diversity. The next step is having clearer, standardized criteria to assess ESG investments — and keep companies accountable.

The ESG boom: “ethical investing” has taken off – but what does it actually mean?

__Shots in the hot seat...__ Last week, President Biden ordered companies with 100+ employees to require employee vaccinations or weekly testing. __[Amazon](https://robinhood.com/stocks/AMZN)__  praised the move, while __[Nike](https://robinhood.com/stocks/NKE)__ and __[Target](https://robinhood.com/stocks/TGT)__ questioned America’s ability to meet the requirement. Some smaller employers and Republican politicians criticized the mandate as costly overreach. Meanwhile, others like __[United Airlines](https://robinhood.com/stocks/UAL)__ and __[Tyson](https://robinhood.com/stocks/TSN)__ have already passed vax mandates. We’ll see how companies approach implementation.

__Prime cap and gown...__ __[Amazon](https://robinhood.com/stocks/AMZN)__  offered to pay full college tuition at select schools for 750K+ employees, in a push to attract workers in a tight labor market. The US has a record 10.9M job openings, but 8.4M Americans are still unemployed. __[Walmart](https://robinhood.com/stocks/WMT)__ and __[Target](https://robinhood.com/stocks/TGT)__  began offering college tuition perks  earlier this summer, __[Uber](https://robinhood.com/stocks/UBER)__ and __[Lyft](https://robinhood.com/stocks/LYFT)__ debuted huge bonuses to attract drivers, __[Chipotle](https://robinhood.com/stocks/CMG)__ and __[McDonald’s](https://robinhood.com/stocks/MCD)__ raised wages, and some big banks even offered employees free Pelotons. TBD if the perks will work.


Zoom Out

Stories we're watching...

__The core of the Apple…__ Tomorrow, __[Apple](https://robinhood.com/stocks/AAPL)__ is expected to drop the iPhone 13 and other new tech goodies at its big launch event. iPhone sales consistently make up over half of the Fruit's total, but they fell in 2019 and 2020. *This* year, iPhone sales soared as the new 5G-enabled iPhone 12 fueled a sweet upgrade cycle — but they’ve slowed quarter to quarter. We’ll see if the iPhone 13 has the specs to rev up demand.

__Here comes the sun…__ energy. Solar energy powers 3% of the US electric grid, but Biden wants it to power *nearly half* by 2050 — which would require solar infrastructure to double each of the next four years, and again by 2030. It’s potentially brilliant news for solar battery makers like __[Tesla](https://robinhood.com/stocks/TSLA)__ and __[Panasonic](https://robinhood.com/stocks/PCRFY)__, and solar panel producers like __[First Solar](https://robinhood.com/stocks/FSLR)__ and __[JinkoSolar](https://robinhood.com/stocks/JKS)__, the world’s largest panel-maker. JinkoSolar’s earnings this Wednesday could shed light on momentum in the solar biz.


Events

Coming up this week...

- __[Shade](https://snacks.robinhood.com/newsletters/IoFpxzaCMWYIRwnWz8IHa/articles/6aRpVMxqEwEvfe2Crkv3qp/):__ Another day, another Zucking. __Facebook__ partnered with Ray-Ban to launch “Stories,” smart glasses that shoot videos, play music, and *aren’t* FB-branded.
- __[B-Day](https://snacks.robinhood.com/newsletters/16uFOszfvdJpLmfPxuN8cQ/articles/1VGWOHosnNxOoSHGQ0xRm/):__ El Salvador became the first country to adopt __Bitcoin__ as a national currency. It's the first big coin experiment, and the stakes are *high*.
- __[Blood](https://snacks.robinhood.com/newsletters/1FAijBlzaHGLZcAV5Dg4Rm/articles/4cHeVkQK4qzzwBVhLUqqOV/):__ The trial of Elizabeth Holmes, disgraced founder of blood-testing startup __Theranos__, kicked off last week— “fake it till you make it” culture is also getting heat.

ICYMI

Last week's highlights...

🌎 The ESG investing boom

__*Throwing major shade...*__ First, __[Facebook](https://robinhood.com/stocks/FB)__ copied (aka: #Zucked) __[Snap](https://robinhood.com/stocks/SNAP)__'s stories  on Insta. Then, FB [announced](https://snacks.robinhood.com/newsletters/20h2lIyDiEHNUxZmIBTfPu/articles/4mgk5kAhdN1WxA59eWKcKo/) plans to launch a smartglass rival to Snap Spectacles. *Yesterday*, FB [unveiled](https://about.fb.com/news/2021/09/introducing-ray-ban-stories-smart-glasses/) those smartglasses — *and they're called "Stories."* FB teamed up with Italian glasses giant __Luxottica__ to launch Ray-Ban branded glasses. FB's first smart glasses are about everything the selfie stick *isn't*: first-person perspective. 

- __Capture:__ Say "Hey Facebook" or press a button to shoot photos and videos (up to 30 secs). Tiny lights let others know when you're recording. *Not* included: AR features.
- __Post:__ Share content to social apps like Insta and TikTok through the FB View App, or save to your camera roll. FB is envisioning [Latte Art](https://www.facebook.com/facebook/videos/2981541412094376/) tutorials. 
- __Hear:__ Listen to music or take phone calls from open-ear speakers. 
- __Pay:__  Stories start at $299 — in the same range as luxury "dumb" glasses. They'll be available in 20 style combos online and in stores like LensCrafters and Sunglass Hut.

__Lab goggle vibes...__ Smart glasses are Big Tech's holy grail, but all efforts have flopped so far: "Google Glass" was an epic fail. Snap lost $40M on 300K unsold AR Spectacles. But FB's smart glasses have one key advantage: they don't *look* like smart glasses.

- __Italian style:__ Luxottica’s chief wearable officer Rocco Basilico, who cold emailed Zuck about the glasses collab, [says](https://www.google.com/url?q=https://www.theverge.com/2021/9/9/22662809/facebook-ray-ban-stories-camera-smart-glasses-hands-on&sa=D&source=editors&ust=1631224633389000&usg=AOvVaw1W1hVZx_ngqAUytZVmvDTm) Stories aren't just a tech gadget, "but something sexy.” Peep this snazzy [video](https://about.fb.com/news/2021/09/introducing-ray-ban-stories-smart-glasses/), starring Basilico and Zuck.
- __American dreams:__ FB hopes to expand Stories into AR, overlaying graphics onto IRL vision. One day, FB hopes AR glasses will be as widely used as smartphones.  


Shade

__FB’s big opportunity = unbranding itself...__ Stories look like Ray-Bans, *not* FB-branded gadgets — unlike FB's other hardware, Oculus and Portal. While FB supplies the tech, Ray-Ban handles the design and sales — a key difference from other tech-designed smart glasses. FB has [admitted](https://www.axios.com/facebook-trust-deficit-digital-wallet-0c89e71b-9aad-4864-97a4-7bec3828051f.html) it has a public "trust deficit." By partnering with a well-loved brand, FB is giving Stories a higher chance of success. 

Facebook unveils its first smart glasses, designed by Ray-Ban: why un-branding is key

__Beautiful (cell) reception...__ __[Verizon](https://robinhood.com/stocks/VZ)__ is celebrating in the endzone. Yesterday, the NFL and Verizon announced a 10-year 5G partnership. By installing faster 5G connectivity in NFL stadiums, Verizon wants to foster new in-person experiences for football fans. 

- __Better than a jumbotron:__ Fans in stadiums can now see seven different live angles and AR overlays of Next Gen Stats on 5G-enabled phones.
- __Game tickets > couch tickets:__ The NFL hopes to get fans off the couch and buying $300 tickets by offering a live experience *plus* at-home stats and insights.
- __Gameday exclusives:__ Verizon gets a chance to show off its fresh 5G capabilities, and potentially poach fans from __[AT&T](https://robinhood.com/stocks/T)__ and __[T-Mobile](https://robinhood.com/stocks/TMUS)__ with exclusive gameday coverage.

__Brands go long on NFL partnerships...__ because they want the NFL's huge — and hugely engaged — audience. Last year, 71 of TV’s 100 most-viewed events were NFL games. Meanwhile: Verizon, AT&T, and T-Mobile spend billions competing for the 5G market — which is expected to hit $148B by 2028 — but have still struggled to win customers. If football fans need 5G to get the most premium access at Cowboys games, they may migrate to Verizon.


Score

__Defining the relationship is key...__ and brands want to make it *official*. __[Anheuser-Busch](https://robinhood.com/stocks/BUD)__, __[Pepsi](https://robinhood.com/stocks/PEP)__, __[Nike](https://robinhood.com/stocks/NKE)__, and __Verizon__ pay as much as $100M+ per season to be *official* NFL partners. Thanks to corporate partnerships, NFL revenue increased 10% last season — despite empty stadiums. Similarly, the Tokyo Olympics had the worst TV viewership in 33 years, but the International Olympics Committed (IOC) still raked in a record $2B+ in global sponsorships — because __[Coca-Cola](https://robinhood.com/stocks/KO)__, __[Toyota](https://robinhood.com/stocks/TM)__, and __[Airbnb](https://robinhood.com/stocks/ABNB)__ paid big bucks to be “official” Olympic partners.

The NFL’s Verizon collab shows the power of DTR’ing partnerships 

_Major shade [Whitney Tuttle/Moment via GettyImages]_

👓 Facebook's smart Ray-Bans

__Not a chapter in the Twilight saga...__ but this story features blood, drama, and bad actors. Yesterday kicked off the trial of Elizabeth Holmes, the disgraced founder of blood testing startup __Theranos__. The Theranos saga has spawned a book, a documentary, a miniseries, and an upcoming movie — but we're Snack-ifying it. 

- __The company...__ was seen as revolutionary. Theranos claimed it had devised blood tests that, using only a few finger pricks of blood, could detect hundreds of health conditions from cancer to high cholesterol — and make lab testing more accessible. 
- __The founder:__ Holmes dropped out of Stanford at 19 to start Theranos, grew it to a $9B valuation, and became the youngest female self-made billionaire. She saw herself as the female Steve Jobs, even sporting the black turtleneck. 
- __The come-up:__ Theranos raised $700M+ from big investors, and had partnerships with companies like __Walgreens__, which planned to open Theranos testing in-store.
- __The scrutiny:__ In 2015, scientists started raising questions about Theranos' secretive testing tech, and the FDA began investigating. Then, a bombshell WSJ report found that Theranos was running its samples through the same machines used by traditional blood-testing companies, since its own machine wasn’t accurate. 
- __The fall:__ In March 2018, Theranos and Holmes were charged with "massive fraud" by the SEC for allegedly lying to investors and customers. Ramesh Balwani, Theranos’ former president and Holmes’ ex-boyfriend, is facing the same charges in a trial set for 2022. Both have pleaded not guilty. 

__The trial...__ is high stakes. If convicted, Holmes faces up to 20 years in prison, plus $2.7M in fines, *plus* restitution to victims. Think: investors who lost money, and thousands of patients who were wronged by Theranos — like people who received false HIV-positive results. The trial is expected to last three months, and legal experts say the prosecution has a strong case. 


Blood

__Holmes is a cautionary tale...__ To the "move fast and break things" ethos of Silicon Valley culture. Recent SV falls-from-grace share one feature:  highly charismatic founders who sold investors on larger-than-life ideas. Think: __WeWork__'s Adam Neumann and __Nikola__'s Trevor Milton. But it's rare for a CEO to face trial and 20 years in jail. 

Theranos saga: the rise, the fall, and the trial of disgraced founder Elizabeth Holmes

__Making Costco blush...__ Direct-to-consumer beauty buyer’s club __Beauty Pie__ just raised $100M at a reported $1B valuation. Beauty Pie's self-described "Sephora meets Costco" model gives e-shoppers access to marked-down products from the same factories that supply premium cosmetics companies. 

- __For $59/year, BP members__ can buy skincare, makeup, and fragrance goodies for a fraction of their “typical” price. Think: Triple Hyaluronic Acid Elastic Lifting Eye Serum for $12.38 instead of $50. 
- Last year, BP’s members doubled — and so did its sales.

__Scrub away the makeup markup...__ BP founder Marcia Kilgore is the ultimate beauty insider — she also founded Bliss, Remède, and Soap & Glory. Kilgore knows makeup markups are *huge* — typically 10X the product's production cost. Beauty Pie strips away marketing frills to focus on competitive pricing. 

- __Members first:__ On its site, BP sells the same products to non-member at “typical” full prices — while subscribers pay special “insider prices.”  
- __Community vibes:__ BP's website features members' favorites, like the Wonderscrub Face Polish, and includes BTS industry tips.


That skincare insider glow [stock_colors/E+ via GettyImages]

__Shoppers want insider access…__ and insider *deals*. Consumers are used to paying retail prices for almost everything, but businesses like Costco and Beauty Pie give them *wholesale* access. That can inspire long-term loyalty: Beauty Pie’s customer retention rates are *20X* higher than other D2C beauty companies — on an elite list of companies that have hit 90%+ member retention rates, including __Costco__ and __Amazon__.

With fresh funding, Beauty Pie bets that insider pricing will inspire extreme customer loyalty

💉 The Theranos saga

__"Happy B-Day"...__ Just got a whole new meaning. Yesterday, El Salvador [became](https://www.wsj.com/articles/bitcoin-comes-to-el-salvador-first-country-to-adopt-crypto-as-national-currency-11631005200) the first country to adopt __[Bitcoin](https://robinhood.com/crypto/BTC)__ as a national currency. Crypto enthusiasts call it "B-Day." Bitcoin is now legal tender alongside the US dollar, which has been El Salvador's official currency since 2001. The Salvadoran government is rolling out Bitcoin ATMs and snazzy kiosks — and offering a $30 BTC credit to those who download its govt-run Bitcoin wallet, Chivo.

- __Crypto pupusas:__ Salvadorans can now pay for anything in Bitcoin, from tortillas to  rent. Twitter was flooded with images of BTC-bought [McMuffins](https://twitter.com/AaronvanW/status/1435236902274220040).
- __Crypto finances:__ Salvadorans can pay taxes and bank loans in BTC, and won't pay capital gains tax when converting to USD.

__Crypto instead of cake...__ Not everyone's into it. El Salvador plans to spend $225M+ in the rollout, but ~65% of Salvadorans *don’t* want the govt to spend tax money on Bitcoin adoption, and 80% lack confidence in BTC. Meanwhile, the IMF is worried BTC's volatility poses major [risks](https://snacks.robinhood.com/newsletters/1ExFruUiLLc3sM39AgchDw/articles/1W2c6WnMGNOPU4Dj6ZMTS2/) to El Salvador's economy, which is already one of Central America's poorest. A Bitcoin price plunge could make its huge debt load even worse. Just yesterday, BTC dropped 10%. Some potential pros...

- __Access:__ El Salvador's President says BTC will improve financial inclusion among the 70% of Salvadorans who don’t have access to traditional financial services.
- __Remittances:__ Because BTC is often cheaper to transfer, it could lower fees for Salvadorans abroad who send money to family in El Salvador. Nearly a third of the economy’s dollars come from “remittances.”

_Not your average B-Day [MEDITERRANEAN/E+ via GettyImages]_

__It's the first big coin experiment...__ and the stakes are high. El Salvador's BTC adoption could destabilize its fragile economy, boost corruption, and be a boon to the Salvadoran president’s authoritarian tactics — *or* it could be a social and economic success. It’s all TBD. But the experiment could be valuable for other governments considering using crypto as legal tender. 


The big coin experiment: El Salvador becomes the first to adopt Bitcoin as legal tender

__Down to the wire...__ Hurricane Ida cut off power for ~1M people in Louisiana and Mississippi. The storm knocked out 31K electric poles – more than hurricanes Katrina, Ike, Delta, and Zeta *combined*. Plus, all those poles were above ground – aka: not protected against 150-mph wind. __[Entergy](https://robinhood.com/stocks/ETR)__, the utility giant with 3M customers across the Gulf states, has restored power to less than half of its affected customers. 

__Pole-arizing issue...__ After the Senate passed its $1T infrastructure bill, officials are debating whether to build new power lines above or below ground. Underground wires can be more than 10X as expensive to build as above-ground wires — but they're also more resilient in disasters like hurricanes and wildfires. And America’s ~70-year-old electric grid is 20 years overdue for an update: 

- __10X__ = The increase in major US electricity outages between the mid-80s and 2012. Outages more than *doubled* between 2017 and 2020.
- __$7T__ = The estimated cost of modernizing America's electricity grid — around 9X more than Biden's infrastructure bill sets aside for electric infrastructure investment.


Wires

__Natural monopolies, extreme outcomes...__ One-third of US electricity companies are state-regulated "natural monopolies" that earn pre-determined returns, which means little incentive to pay for pricey upgrades. Often, taxpayers end up footing the costs: a whopping $99B just last year. Now, policy makers are debating whether to pay utility companies to update their infrastructure, or fine them if they don't: Last year, __[PG&E](https://robinhood.com/stocks/PCG)__ was fined ~$2B after its old wires caused several devastating wildfires.


Hurricane Ida outages expose a growing problem for America’s aging power grid

🧪 The big coin experiment 

__Check the math again…__  August job numbers were as disappointing as a Fyre Festival [sandwich](https://www.flipkick.io/nfts/fyre-festival-cheese-sandwich). The US economy added only 235K jobs, the lowest gain since January — economists were expecting 720K new hires. The unemployment rate dipped to 5.2% from 5.4% in July — still higher than pre-pandemic.

- __The labor force participation rate__ — aka: the percentage of 16+ year olds that are working or actively looking for work — stayed at 61.7%, well below 63.3% pre-pandemic.
- __It’s not that there aren’t enough jobs.__ There are record high [~10M](https://www.washingtonpost.com/business/2021/09/04/ten-million-job-openings-labor-shortage/?utm_source=pocket_discover) US job openings. Still, 8.4M Americans are unemployed. A few reasons why workers aren't returning...

__1. Covid fears__ are keeping workers home as Delta surges, especially in customer-facing jobs. Leisure and hospitality jobs (think: waiters), which have been the primary driver of job growth this year, actually *lost* workers last month.

__2. Childcare needs:__ Delta uncertainty has forced dozens of US school districts to postpone their return to IRL classrooms. That could slow job growth among parents — especially women, who’ve [shouldered](https://snacks.robinhood.com/newsletters/4FiPxYkU4FGEKs36P1LNJJ/articles/4kp1BqJkQIJqk2dJ3iMTuU/) a larger share of pandemic childcare duties.

__3. Boosted unemployment benefits:__ The extra $300/week in enhanced unemployment benefits are set to expire nationwide this week. Half of US states already cut off boosted payments earlier this summer. And they've [seen](https://www.google.com/url?q=https://www.wsj.com/articles/states-that-cut-unemployment-benefits-saw-limited-impact-on-job-growth-11630488601?mod%3Darticle_inline&sa=D&source=editors&ust=1630799320111000&usg=AOvVaw2fEC-n3liopuRWhB5E-OkY) about the same job growth as states that didn't. It's still too early to know how the nationwide cut-off will affect job growth.

__4. Favorable labor market:__ Jobs are plentiful, and wages are rising faster-than-expected as companies from __[CVS](https://robinhood.com/stocks/CVS)__ to __[Walmart](https://robinhood.com/stocks/WMT)__ hike pay and benefits to attract workers. People are becoming choosier about jobs they take, which can mean sitting out longer. 


_Taking the jobs report out of the oven like [Alan Thornton/The Image Bank via GettyImages]_

Labor

__It's the Delta jobs report...__ In August, the number of people who said they couldn't work for a pandemic-related reason jumped by a whopping 400K, for a total of 5.6M. The US is seeing ~150K new Covid cases/day as the Delta variant spreads. It’s raising concerns that economic recovery could stall. The August jobs report could also cloud policy for the Fed, which is [weighing](https://snacks.robinhood.com/newsletters/4gMiOgVApFMLOTW9UsICpO/articles/5QNJY6U0q9a5UKIr2wDLB3/) when to reign in its economy-boosting policy.

The bummer August jobs report: from expiring unemployment $$, to Delta’s dent

__International lawyers on speed-dial…__ Data privacy and antitrust troubles are piling up globally for tech giants. __[Facebook](https://robinhood.com/stocks/FB)__-owned WhatsApp was fined $270M for privacy violations last week as part of Europe’s GDPR crackdown. Meanwhile: South Korea [passed](https://snacks.robinhood.com/newsletters/2OkX8F6GVFrw8mk8X5esRE/articles/34EZJfcpcU7H6UK6Y8of8q/) the first law in the world that dents __[Google](https://robinhood.com/stocks/GOOGL)__ and __[Apple's](https://robinhood.com/stocks/AAPL)__ app store payments dominance, setting a precedent other countries could follow. 

__Corporate thirst…__ Extreme climate events — like CA’s wildfires and Hurricane Ida — are diminishing global water supply by contaminating reservoirs. The number of people with limited water is expected to more than double by 2025 to 1.8B. Now, companies that use water for everything from making cookies to cooling data centers are making moves: __[Procter & Gamble](https://robinhood.com/stocks/PG)__ is donating money to protect water supplies, and __[Nestlé](https://robinhood.com/stocks/NSRGY)__ plans to conserve more water than it uses by 2025.

__Love the pleather skirt...__ *Don't* love the $300 price tag. The “buy now, pay later” biz is [booming](https://snacks.robinhood.com/newsletters/1TtUXZyHvZ2SETOZOaUYq7/articles/2wpby5ZPzAfks9OlK1Syl/), as younger shoppers skip credit cards. BNPL giant __Klarna__ hit a $46B valuation in June, and __[Square](https://robinhood.com/stocks/SQ)__ bought __Afterpay__ last month for a whopping $29B. Now, BNPL company __[Affirm](https://robinhood.com/stocks/AFRM)__ is partnering with __[Amazon](https://robinhood.com/stocks/AMZN)__ to allow 'Zon shoppers to pay in installments. We’ll see if BNPL’s growth — which took off when money was tight last year — is still strong when Affirm reports earnings on Thursday. 

__Labor Day BBQ vibes...__ On the grill: earnings reports.  Rival grill-makers __[Traeger](https://robinhood.com/stocks/COOK)__ and __[Weber](https://robinhood.com/stocks/WEBR)__ went public this summer as the pandemic fueled outdoor activities, including a [BBQ boom](https://snacks.robinhood.com/newsletters/6MmYKB2qyTGOmgSv4zyTxs/articles/78GJOjGxAAxgrjDmtdC6Rg/). One in four grills on Earth are Weber's, but Traeger’s sales have been growing faster. Shares of both grill giants are up 20%+ since listing. We’ll see if sales are still sizzling when Traeger serves up earnings on Thursday.

- __[NFTs](https://snacks.robinhood.com/newsletters/5HtwscQfcOrULa2oxOGp86/articles/36E5lFAKkacaWtELf3d5qX/):__ From Simone Biles to Shawn Mendes, sports stars and celebs are embracing non-fungible tokens to unlock the next opportunity in the fan economy. 
- __[Ida](https://snacks.robinhood.com/newsletters/4V221H51NGTebnJfxGViJU/articles/3MYdkqm3q0EmiHfYmE5WYS/):__ Hurricane Ida is impacting consumers and businesses across industries, from oil and gas to insurance. 
- __[Drive](https://snacks.robinhood.com/newsletters/4V221H51NGTebnJfxGViJU/articles/1jaX5bVRMCbnFFhVLS2ZSg/):__  __Apple__ is continuing its wallet takeover with a virtual driver’s license — and digital keys are next.

🥤 The job situation, feat. expiring unemployment $$

__GDP-R-you-ready-to-rumble…__ EU regulators slapped __[Facebook’s](https://robinhood.com/stocks/FB)__ WhatsApp with a $270M fine this week for violating GDPR. Europe’s General Data Protection Regulation, aka: the world’s toughest data privacy law, forces companies to get permission to collect and share users’ data, protect that data, and report any breaches. That makes it harder for companies to monetize valuable user info (think: Facebook and ad targeting). According to regulators, WhatsApp shared data with FB and Insta without users’ permission.  

__Cue the GDPR yellow cards…__ But instead of a warning, companies are now getting fat fines. When GDPR went into effect three years ago, enforcement was minimal: European regulators had only issued around $86M worth of GDPR fines by the start of 2020. Since then, that figure has *skyrocketed* to $1.5B. Privacy activists have praised recent fines, but some say they’re still not big enough: For context: GDPR allows fines of up to 4% of a company’s global revenue, which means fines for __[Amazon](https://robinhood.com/stocks/AMZN)__ could hit $15.4B. Some of the heftiest GDPR fines since 2019:

- __France__ fined __[Google](https://robinhood.com/stocks/GOOGL)__ $57M for illegal data processing.
- __Germany__ dinged __H&M__ $42M for secretly collecting employee data.
- __The UK__ docked __[Marriott](https://robinhood.com/stocks/MAR)__ $24M and __British Airways__ $26M. 
- __Luxembourg__ fined __Amazon__ a whopping $886M for a data breach.

_Higher stakes than FIFA [John Lamb/The Image Book via GettyImages]_

Private

__Privacy is knocking…__ GDPR enforcement in Europe could inspire stricter privacy regulation across the globe. Last year, France fined Google $120M and Amazon $42M under its *own* national privacy laws. Regulators in Brazil, Japan, and India have also passed stricter privacy regulation inspired by GDPR. The US has no national equivalent, but California and Virginia passed GDPR-esque state laws — and Washington and New York are considering similar laws to protect citizens’ data.

Facebook’s WhatsApp just got a $270M privacy fine — global regulators are doubling down 

__Cutoff shorts summer...__ follows bralette spring. Mall icon __[American Eagle](https://robinhood.com/stocks/AEO)__ reported all-time high second-quarter sales yesterday. But sales still missed expectations, and the stock dropped 10% (womp). Mid-pandemic, AE's core brand sales fell while its loungewear sub-brand Aerie thrived. Aerie sells comfy basics, from hoodies to flared leggings — and makes up more than a fourth of AE's total sales. Pandemic-friendly Aerie is still #thriving, but AE's jeans and blouses bounced back last quarter, and are growing faster. 

- __Jegging fit:__ AE's sales surged 35%, while Aerie's grew 34%. It's Aerie's *27th straight* quarter of double-digit sales growth. 
- __IRL fit:__ AE's online sales *fell* as shoppers returned to its 1K+ (non-clickable) stores. Meanwhile, __[Gap](https://robinhood.com/stocks/GPS)__ and __[Macy’s](https://robinhood.com/stocks/M)__ have seen ecomm growth taper. 
- __School fit:__ Another retail trend that AE noted: back-to-school shopping is happening later than usual. __[Abercrombie](https://robinhood.com/stocks/ANF)__ suffered the consequences last quarter. 

__Not a horror movie...__ Last quarter, AE did a stellar job avoiding "The Discount Spiral of Death" by reducing discounts and avoiding overstock. That lack of 70% off tags led to a $121M profit, up from a $14M *loss* last year. AE also optimized costs by closing 18 core brand stores last quarter — *but it opened 23 new Aerie stores*.

Bralette

__Sub-brands are the new front-brands...__ Despite AE's rebound, Aerie was the earnings star. *It's a theme*: sub-brands have been driving big growth for their parents. __[Urban Outfitters](https://robinhood.com/stocks/URBN)__' sales more than 3X'd last quarter, thanks to a major boost from its Free People activewear sub-brand, “Movement.” Hollister and lingerie brand Gilly Hicks now make up more than half of Abercrombie's total sales. And Old Navy makes up more than half of Gap's sales.


American Eagle's earnings: revenge spending, school delays, and the sub-brand takeover

💬  Facebook's big privacy fine

__Center of the storm...__ Hurricane Ida reached the US Gulf Coast on Sunday as a Category 4 hurricane. For context: Category 5 is the highest. It's the most intense hurricane Louisiana has suffered since Hurricane Katrina in 2005. Ida has already led to six deaths, and left 1M+ people without power. 

__From small businesses to energy giants...__ Ida's impact is far-reaching. Damage to the power grid and other infrastructure has been intense — even [more](https://www.cnbc.com/2021/08/31/entergy-president-some-hurricane-ida-power-outages-could-be-fixed-in-a-few-days.html) than Katrina's in some cases. 

- __Electricity:__ The entire city of New Orleans lost power after all of its transmission lines were knocked out. Restoring full power and A/C could take weeks, though __Entergy__ — which provides electricity to 3M customers in LA, MS, AK and TX — [says](https://www.cnbc.com/2021/08/31/entergy-president-some-hurricane-ida-power-outages-could-be-fixed-in-a-few-days.html) it's already been restored for 100K people.
- __Oil and gas:__ Gas prices are rising after Ida shut down a critical swath of US oil operations, including more than 90% of production in the Gulf of Mexico. Big deal, since Louisiana’s 17 oil refineries account for [20%](https://www.nytimes.com/2021/08/30/climate/ida-chemical-plants-refineries.html) of the US' capacity. 
- __Insurance:__ The insurance industry expects Ida damages to be in the range of $15B-20B, compared to $65B for Katrina. But that's just *insured* losses — aka: not the total value of damages. CoreLogic [estimates](https://www.corelogic.com/press-releases/hurricane-ida-threatens-941392-homes-with-storm-surge-damage-according-to-corelogic-risk-analysis/?utm_source=microsite%E2%80%8B&utm_medium=organic%E2%80%8B&utm_campaign=FY21-Q3-P-HZLI-HzrdRisk-2021-ISS-Ida-HHQ-Response) that ~1M homes could be damaged, totaling $220B in reconstruction costs. And insurance costs are already [rising](https://www.ksla.com/2021/05/16/homeowners-insurance-grows-more-expensive-policies-could-be-harder-come-by/) for high-impact areas and homes with older roofs.

__It can take years to bounce back...__ from natural disasters. A hurricane might only last a week, but the damage it causes can take years — or decades — to repair. New Orleans has [still](https://www.eesi.org/articles/view/fourteen-years-later-new-orleans-is-still-trying-to-recover-from-hurricane-katrina) not fully recovered from Katrina, and we don’t yet know what Ida’s total toll could be.  Meanwhile, CA is experiencing extreme heat-fueled wildfires. Climate experts say these extreme natural events could worsen as the planet continues to warm.


Storm watch: Hurricane Ida's impact on consumers and businesses across industries

__Got my driver's iLicense last week…__ Yesterday, __[Apple](https://robinhood.com/stocks/AAPL)__ partnered with eight US states to launch digital driver’s licenses on iPhones and Apple Watches. Apple emphasized that its new IDs are “more secure” than IRL licenses. The e-licenses will roll out in Apple Wallet after an iOS update this fall. How they’ll work:

1. __Scan__ your license with your iPhone, like you’d scan a card for Apple Pay.
2. __Take a cute selfie__ that’ll be sent to your state for verification.
3. __Twist your head around__ for a biometric scan with Apple’s FaceID tech.
4. __Sail through security__ by tapping your iPhone or Apple Watch and scanning your face or your fingerprint at TSA. TBD if the police will accept it for traffic stops.

__Plastic is *so* 2020…__ Apple Pay is the top mobile payment tool in the US, with 44M users. But Pay is only the beginning: Apple wants to take over your whole wallet, purse, and keys. After touting privacy for years, Apple hopes customers will trust its devices as all-in-one passkeys to *everything*:

- __Leave the purse at home…__ In addition to in-store payments, Apple Wallet can be used to: ride public transit, check in to concerts, and store boarding passes and health insurance cards. 
- __No keys, no problem…__ Apple Wallet can already be used to unlock cars, and even access some college buildings. Soon, Wallet will also be able to unlock homes, hotel rooms, and offices.
- __Not just Apple…__ Competitors including __[Google](https://robinhood.com/stocks/GOOGL)__ and __[Clear Secure](https://robinhood.com/stocks/YOU)__ are also building digital IDs. The e-ID market is expected to double between 2021 and 2026.


_"Ladies, can I see some ID?" [praetorianphoto/E+ via GettyImages]_

__IDs are the next step in smartphone dependence…__ Every day, billions of people use smartphones to chat with friends, order food, book rides, watch shows, and navigate. Now, Apple wants iPhone to be the *only* thing people grab when they go out. By positioning its devices as all-in-one wallets, keys, and health monitors, Apple hopes to make iPhones and Apple Watches truly indispensable — and gain an edge over other smartphone makers.

Apple continues its wallet takeover with a virtual driver’s license — and keys are next

🌧 Ida's impact

__*Doing some Seoul searching*...__ Big Tech. Yesterday, South Korea passed the first law in the world to dent __[Apple](https://robinhood.com/stocks/AAPL)__ and __[Google](https://robinhood.com/stocks/GOOGL)__'s dominance over app store transactions. Quick refresher: Apple and Google typically take a ~30% cut of in-app purchases, downloads, and subs. Those in-app purchases must flow through Apple/Google's own payment systems. Now…

- __Not just Apple and Google Pay:__ South Korea will [require](https://www.wsj.com/articles/google-apple-hit-in-south-korea-by-worlds-first-law-ending-their-dominance-over-app-store-payments-11630403335) the tech giants to allow payment systems from other payment processors and developers.
- __That threatens the 30% "App Tax"__ that Apple/Google collect. If they don't comply, the tech giants could be fined up to 3% of their South Korea revenue.

__BRB, going app shopping...__ Don't sprain a finger. Apple says its current app store policies help protect user safety. But given recent scrutiny, the Fruit halved its 30% fee for developers earning less than $1M/year, and Google said it would only take 15% of developers' first $1M. This South Korean law is the biggest threat so far to their app store dominance — *but it's not the first*.

- __Fortnite-maker Epic Games__ added its own in-app payment system to bypass the "App Tax." Apple and Google responded by expelling Fortnite from their app stores, leading to the ongoing [Epic trial saga](https://snacks.robinhood.com/newsletters/5mrz8IgUB1Bjuc9ILsHQOj/articles/4GARoezVkzR6VmTXvlwEa1/). 
- __Last month, a bipartisan group of US Senators__ [proposed](https://www.theverge.com/2021/8/11/22620454/apple-google-app-store-senate-play-bill-epic-games-fortnite) legislation similar to South Korea's. In June, a House Committee approved major legislation to curb Big Tech's dominance. Meanwhile, Australia is considering new regulations for Apple/Google Pay. 


"Provide alternative payment method" [Yuri_Arcurs/E+ via GettyImages]

Swipe

__Precedent is powerful...__ This South Korean law and its impact could be referenced by regulators in *other* countries to curb Apple and Google's dominance. Regulators will be watching to see how South Korea’s law pans out. For example: if it results in more fraud, as Apple has warned. Either way, Apple and Google’s app store payments dominance is no longer absolute. 

South Korea's new law is the first to dent Google and Apple's app store payments dominance

__Potato box delivery...__ coming in hot. __[Pinduoduo](https://robinhood.com/stocks/PDD)__ has surpassed __[Alibaba](https://robinhood.com/stocks/BABA)__ — aka: "the Amazon of China" — as China’s most popular ecomm platform by user count. Pindoudou's app connects farmers/distributors with Chinese consumers. The $120B "social ecommerce" platform doesn't really have a US equivalent: shoppers can play games to win prizes, like discounts or boxes of mangoes. Pinduoduo’s sales still trail Alibaba’s, but it’s growing faster — and its stock is up 10% over the past year, while Alibaba’s down 40%.

__Mangoes > Louis Vuitton…__ The ruling Chinese Communist Party (CCP) has increasingly emphasized its goal of achieving “common prosperity” — and alleviating rural poverty. That's partly why it's cracked down on Big Tech this year, from fintech giant __Ant Group__ to video game giant __Tencent__. Oh, and China fined Alibaba a record $2.8B for "anticompetitive practices." Think: preventing luxury merchants like Louis Vuitton from selling  on other platforms.

- __Pinduoduo is on China's "better" side:__ Its agriculture-friendly biz model is better aligned with China's rural prosperity goals. Its quiet social presence and focus on low-income customers has helped it avoid Alibaba-level fines. 
- __Pinduoduo wants to keep it that way:__  After turning its first profit last quarter, Pinduoduo announced plans last week to donate $1.5B in profits to Chinese farmers. 


Mango

__Beijing rewards compliance...__ China’s crackdown on Alibaba gave Pinduoduo room to grow. To keep growing, Pinduoduo wants to stay in China’s good graces by giving its profits away to farmers and supporting the government’s plans for agricultural development. Companies in other industries are making similar moves to avoid State restrictions. This month, Tencent, which got rocked by China’s [gaming restrictions](https://www.npr.org/2021/08/30/1032489883/china-kids-video-games-limits), pledged $7.7B to “common prosperity” initiatives. 