__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.

Zoom Out

Stories we're watching...

__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.

Events

Coming up this week...

- __[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.

ICYMI

Last week's highlights...

Dow Jones

S&P 500

Nasdaq

Bitcoin

🥤 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. 

Pinduoduo passes its profits to farmers — and scores points with the Chinese government

📱 Apple and Google's big threat 

__Grab a Sharpie and some blockchain...__ NFT autographs have arrived. NFTs (non-fungible tokens) are like one-of-a-kind trading cards, but digital. Instead of living in a glass case, they live on a crypto blockchain. Today, star gymnast Simone Biles released an NFT collection with __Autograph__, which makes NFTs signed by athletes like Tom Brady, Derek Jeter, and Tony Hawk. Buyers can trade the tokens in __DraftKings'__ NFT marketplace — where a Naomi Osaka Autograph NFT is currently selling for $63K.

__From Taco Bell-themed art...__  to the internet's [original source code](https://www.wsj.com/articles/internets-original-source-code-sold-as-nft-for-5-4-million-11625092875), NFTs can be tied to any digital asset. The first NFT hit the blockchain in 2014. Since then, people have sold NFTs of tweets, songs, and even Nobel Prize patents. Over the past year:

- __NFT sales soared__ from $13.7M in the first half of 2020 to more than *$2.5B* in the first half of this year — a 200X increase. 
- __Celebrities__ like Snoop Dogg, Paris Hilton, and even Edward Snowden, have all launched NFTs.
- __Big brands__ aren't missing out on the non-fungible frenzy: __Charmin__ rolled out a virtual toilet paper called “NFTP” (lol), __Taco Bell's__ NFTacos sold out in 30 minutes, and __Pringles__ sold virtual "CryptoCrisps" for $2 each — they're now selling for about $8K/tube.

_Can't funge it [Westend61 via GettyImages]_

Token

__NFTs may be the new merch...__ of the fan economy. Sports and entertainment stars mostly rely on brand sponsorships, events, and merch sales to monetize their millions of fans. NFTs give fan-favorites from Shawn Mendes to Naomi Osaka a new tool to monetize their followers with digital product sales. __OpenSea__, the largest NFT marketplace, takes a 2.5% cut of NFT sales — a good deal compared to YouTube’s 45% cut, OnlyFans’ 20% cut, or even Substack’s 10% cut.

Sports stars and influencers embrace NFTs to unlock the next opportunity in the fan economy

__You're on mute...__ Now repeat the 30-second spiel. __Zoom__ has become a verb, a meme, and a lifestyle — but its latest earnings show the glory days may be fading. Last year, Zoom’s revenue more than quadrupled from the previous year as it led the WFH boom. Zoom's sales are still growing – *but more slowly*.

- __Zoom's quarterly sales grew__ 54% from last year — down from nearly 200% growth in the previous quarter. Next quarter, it's [expecting](https://www.cnbc.com/2021/08/30/zoom-zm-earnings-q2-2022.html) even slower growth.
- __Zoom stock dropped 10% after earnings.__ This year, it’s down 4%, while the market-tracking S&P 500 is *up* 22%.

__*Zoom, zoom, zoom, zoom…*__ I want you in my conference room. Zoom's growth is slowing as people return to offices and IRL events. It's also experiencing the "DPF Effect," aka: demand pulled forward. Growth that should've happened last quarter happened all at once last year. Now, Zoom's getting creative to help keep the boom going:

- __Zoom-as-a-service:__ In March, Zoom [said](https://snacks.robinhood.com/newsletters/7IXHGclHWhuwIRdIXkbPpj/articles/7yl3Ro8aKD5ZcthEt561jK/) it would start licensing its video conferencing tech to other apps as an unbranded service. Think: dating apps and telehealth providers.
- __Live events:__ In October, Zoom [launched](https://blog.zoom.us/zoom-events-virtual-experiences/) "OnZoom" for people to find and host paid virtual events, from live performances to yoga classes. In July, it launched "Zoom Events," for companies to host external and internal interactive events (think: large workshops).
- __Customer service:__ In July, Zoom announced plans to buy cloud-based customer-service platform __Five9__ for a whopping $14.7B. Zoom sees it as a way to attract more big enterprise customers.


Muted

__Zoom doesn't need to change its product...__ to keep growing post-pandemic. It just needs to keep expanding beyond work meetings. That’s why it’s putting its tech to work through live events and whitelabel licensing. Even with the Delta variant surging, the fully remote office life likely won’t last forever. But Zoom could thrive in a hybrid IRL-virtual future — *if* it offers the tools to support it. 


Zoom's growth is slowing, so it's getting crafty to help keep the Zoom Boom alive

🤸🏾‍♀️ Simone Biles NFTs

__SPAC at it again...__  Since last year, special purpose acquisition companies have dominated the public market. SPACs go public for the sole purpose of one day acquiring a *real* company and taking them public. __[DraftKings](https://robinhood.com/stocks/DKNG)__, __[Virgin Galactic](https://robinhood.com/stocks/SPCE)__, and __[Opendoor](https://robinhood.com/stocks/OPEN)__ all went public by merging with SPACs. Wild stat: SPACs have accounted for ~70% of all IPOs in 2021. So far this year, SPACs have raised a record-breaking $129B — already more than they raised in 2020. But as SPAC popularity has grown, so has scrutiny: 

- __SPAC lawsuits have tripled__ this year, including against billionaire Bill Ackman’s SPAC.  Many cases involve allegations of misleading investors. 
- __Short-selling firms__ have increasingly scrutinized companies that went public via SPAC. The CEOs of e-truck startups __[Nikola](https://robinhood.com/stocks/NKLA)__ and __[Lordstown](https://robinhood.com/stocks/RIDE)__ resigned after a short-selling firm alleged they exaggerated their tech and misled investors. 
- __SPACs tend to lose__ a third of their value post-merger on average, according to a study spanning 2019 to 2020. The 50 biggest SPACs have lost 20% in value this year.

__Not always SPAC-tacular…__ SPACs offer a faster, and sometimes cheaper, way for companies to go public. A SPAC merger usually happens in three to six months on average, while an IPO can take 3X to 4X longer. Companies that go public via SPAC are also allowed to make sales projections to prospective investors, while IPO companies can’t. Plus, SPACs can sometimes help companies avoid initial mispricing. But with increasing scrutiny of SPACs, we may see more regulation in the future.


SPAC-y

__SPACs can be a double-edged sword…__ SPACs’ advantage — a faster, more frictionless path to going public — might also be their weakness. Companies that go public via SPAC sometimes face less oversight than those that IPO. Meanwhile, newly-public SPACs may not be able to provide as many disclosures to investors since their acquisition target has yet to be named,  and financial diligence may be narrower. But all investments carry risk – and even the IPO review process, designed to help protect investors, isn’t a guarantee that companies' disclosures are completely accurate.

SPAC popularity has grown, along with scrutiny of the IPO alternative

__The Delta effect...__ __[Pfizer's](https://robinhood.com/stocks/PFE)__ Covid vaccine received the first full FDA approval last week, with __[Moderna's](https://robinhood.com/stocks/MRNA)__ expected next. The official greenlight could boost vax confidence — and sales.  President Biden wants Americans to get booster shots this fall. Meanwhile, more employers are using “sticks” instead of carrots: __[CVS](https://robinhood.com/stocks/CVS)__, __[Chevron](https://robinhood.com/stocks/CVX)__, and __[Disney](https://robinhood.com/stocks/DIS)__ mandated employee vaccination, and __[Delta](https://robinhood.com/stocks/DAL)__ is hiking health insurance premiums for unvaccinated workers. But some countries — many in Africa — are still waiting to get their first vaccines. 

__Equal and opposite rehack-tion...__ __[Google](https://robinhood.com/stocks/GOOGL)__ and __[Microsoft](https://robinhood.com/stocks/MSFT)__ committed $30B to improve national cybersecurity at President Biden’s summit last week. This month, hackers stole sensitive data on 50M __[T-Mobile](https://robinhood.com/stocks/TMUS)__ customers in a major cyberheist — the company’s  third in two years. Global cybercrime losses skyrocketed to nearly $1T in 2020, and the cybersecurity market is expected to more than double between 2021 and 2028. 

__Keep the e-kibble crunching...__ __[Chewy's](https://robinhood.com/stocks/CHWY)__ sales soared 47% last year as its 19M pet parents ordered goodies online for their pandemic pups. Now, Chewy hopes its popular recurring Autoship feature – for everything from Star Wars toys to pup puzzles – will keep online sales strong as in-store browsing returns. We’ll see how pet parents feel when Chewy reports earnings Wednesday. 

__Zoom face ready…__ __[Zoom's](https://robinhood.com/stocks/ZM)__ sales last quarter more than tripled from last year thanks to all our WFH'ing. Since most companies are planning on hybrid workforces, Zoom could lose business to the IRL office life. But as many employers delay return-to-office dates, Zoom might not be sweating when it reports its latest earnings today. 


_Chewy earnings call: Zoom face ready [Justin Paget/Stone via GettyImages]_

- __[Uber](https://snacks.robinhood.com/newsletters/16eEsik1Fk53zullntgMTm/articles/1p7Zbl78TlS0t7oJltTCT0/):__ A CA judge ruled that Prop 22 is unconstitutional — now the future of the gig economy is up in the air (again).
- __[Tap](https://snacks.robinhood.com/newsletters/4sQYPGu7XlVaHzU9SWyAuX/articles/5bbRivvFVt42XmaN6d7lvb):__ __TikTok__ and __Instagram__ are launching in-app shopping tools to make impulse purchases even easier.
- __[WFH](https://snacks.robinhood.com/newsletters/4gMiOgVApFMLOTW9UsICpO/articles/2ETyPeiMi9iPhMYkSutzjZ):__ Nine in 10 companies plan to leverage a hybrid working model — to make remote feel closer, __Salesforce__ is betting on __Slack__. 

🏦 What the SPAC 

__Jerome puts on his Zoom face....__ We're imagining a "raining hundreds" background. Investors have eyes on the Fed's annual Jackson Hole meeting today, which is being held virtually. Wall Street wants to know if the central bank is prepared to wind down its *massive* pandemic bond-buying program, which has helped economic recovery. 

- __Since March 2020,__ the Fed has added trillions to the money supply through bond-buying. It's currently dropping a whopping $120B *per month* on  Treasury and mortgage bonds.
- __How it works:__ The Fed buys bonds from banks, and the new cash that banks receive flows through to consumers and businesses through loans, etc. 
- __Why it works:__ All that money helped bring us ultra-low interest rates during the pandemic, which boosted spending. Think: lower rates for mortgages and biz loans. 

__Inflated = the new bloated...__ The Fed's "easy money" policy has helped the __[S&P 500](https://learn.robinhood.com/articles/7kFFEUv46vmMCmMfLuNiRX/what-is-the-s-and-p-500/)__ — a benchmark for US stocks — nearly double in value since March 2020. But as the economy swiftly recovers and prices rise (#flated), the central bank is [considering](https://www.google.com/url?q=https://apnews.com/article/business-health-coronavirus-pandemic-72262cd28f438fc3c856661b82316ca1&sa=D&source=editors&ust=1630014377151000&usg=AOvVaw16ksF7kxEGIVhu03BFkE0Q) reigning in its policy *this year*. Notes from the Fed's latest July meeting suggest the economy is closer to achieving the Fed’s inflation and employment goals. 

- __Unemployment__ was at 5.4% in July, down from 10.2% a year ago — but it's still 2% higher than the pre-pandemic rate. Job recovery has slowed, despite record openings. 
- __Inflation:__ Consumer prices are up 5.4% from last year, and the Fed's ultra-low interest rate policies aren't helping.  
- __GDP:__ While the US economy is rebounding, many economists have [downgraded](https://www.detroitnews.com/story/business/2021/08/26/economy-us-slightly-upgrades-gdp-estimate-last-quarter/5599916001/) their estimates for yearly growth as the Delta variant surges.


_Waiting for the Fed to text back like... [Image Source via GettyImages]_

Billions

__We're all in the same boat...__ The Fed, investors, and businesses are facing the same uncertainty with Delta. That's why the Fed might not share its tapering plans today — *or for months*. Since the Fed's last update: Covid cases and hospitalizations have [doubled](https://www.wsj.com/articles/delta-variant-may-come-for-the-feds-fall-plans-too-11629389509), more companies and governments have re-imposed restrictions, and consumer spending and confidence have dropped. The Fed's not the only one wondering how Delta will affect recovery.

All eyes are on the big Fed meeting today, but we might not get a game plan for awhile 

__Slack was added to #Salesforce…__ and it’s blowing up the channel. Software giant __[Salesforce](https://robinhood.com/stocks/CRM)__ raised its yearly earnings forecast on unexpectedly strong sales, and the stock popped 4% yesterday. Contributing to the growth:

- __Slack:__ Salesforce bought the office chat app, which has 10M+ daily users, for a whopping $27.7B last quarter.
- __#s:__ Slack is expected to generate just 4% of Salesforce’s revenue this year — but its sales last quarter grew *faster* than all of Salesforce’s major divisions.

__Counting heart reactions…__ Slack is central to Salesforce's strategy, because the future of work is trending hybrid. Nine in 10 companies plan to combine remote and in-office work, but only [a third](https://investor.salesforce.com/press-releases/press-release-details/2021/Slack-Supercharges-Salesforce-Customer-360-for-Sales-Service-Marketing-and-Analytics/default.aspx) feel prepared. Salesforce believes all businesses will need more remote capabilities. Salesforce believes its Slack-quisition will power:

- __Digital HQs:__ Salesforce integrated Slack with its existing service, marketing, and analytics software to help businesses keep track of customers and close deals all in one digital HQ.
- __Hybrid work:__ NBD if your vendors and clients are fully remote. Slack Connect, launched during the pandemic, allows cross-company collaboration. Usage boomed last quarter, as workers sent crucial docs and emojis to external partners.


Work

__Making remote feel close is key…__ Whichever company pulls it off could win the workplace software wars. Salesforce is betting big on Slack, while other biz software companies are launching remote-first tools: __[Microsoft](https://robinhood.com/stocks/MSFT)__, whose Teams workplace comms platform has 250M monthly users, launched an employee experience platform to give remote teams an “integrated experience,” and __[Dropbox](https://robinhood.com/stocks/DBX)__ revamped its virtual workplace to serve remote clients.

Salesforce thinks the future of work is hybrid — and wants it to happen over Slack

💴 All eyes on the Fed

__*Lots to unpack*...__ Creator subscription platform __OnlyFans__  is famous for #NSFW adult content, but it's been focused on growing its "SFW" creators (like: yoga instructors and Cardi B). Last week, OnlyFans [said](https://www.google.com/url?q=https://www.wsj.com/articles/onlyfans-to-ban-content-featuring-sexually-explicit-conduct-11629407757&sa=D&source=editors&ust=1629941495627000&usg=AOvVaw2Ar0PodEiQ8ffWPhAMcE8T) it would ban "sexually-explicit conduct" by October 1, citing pressure from financial partners. The bombshell decision drew [backlash](https://www.cnbc.com/2021/08/25/onlyfans-says-it-will-no-longer-ban-porn-after-backlash-from-users.html) from sex workers, who’ve fueled the platform's rapid growth. *Yesterday*, OnlyFans did a stunning 180:

- __OnlyFans scrapped the major policy change,__ saying it received assurances from its banking partners that'll allow it to "provide a home for all creators.”
- __In context:__ OnlyFans keeps 20% of subscription sales, and creators keep the rest. Creators have earned $5B+ on its platform — and 300 creators earn $1M+/year.

__The "vice" problem...__ OnlyFans is one of the most profitable Creator Economy platforms, especially since the pandemic. Within a year, it grew from 20M+ users to a stunning [120M+ ](https://www.businessinsider.com/onlyfans-lockdown-boom-transactions-hit-24b-revenue-up-553-2021-4)users. It raked in $375M in revenue last year, and is expected to hit  $1.2B in revenue and $417M in pre-tax profit this year. Despite those enviable numbers, OnlyFans has [reportedly](https://www.axios.com/onlyfans-investors-struggle-9cc92523-6607-40ad-9893-4175e7966b52.html) struggled to find investors. 

- __Many VC funds have "vice clauses"__ that prevent them from investing in industries like: tobacco, alcohol, drugs, porn, weapons, and sex-tech. That limits OnlyFans' fundraising potential.
 - __Vice clauses can also impact investment choices__ of public funds (think: mutual and pension funds), governments, endowments, and other institutional investors. That could hurt OnlyFans if it decides to IPO. 

__Zoom out...__ Vice clauses limit investment in many industries, and are designed to avoid risk. With OnlyFans, some financial partners are concerned about a potential for sexual exploitation of minors — and the legal liability that carries. __Mastercard__, __Visa__, and __Discover__ cut ties with __Pornhub__ last year after the site was accused of being complicit in trafficking child abuse imagery.


NSFW

__It’s hard to play both sides...__ The "vice" identity isn't something companies can dabble in without tradeoffs. For "vice companies," it's hard to please both investors and the community, since success is often rooted in the "vice." They have to plant their flags somewhere, and risk alienating either investors or users. OnlyFans tried to have both — that backfired, so it decided to take the risk with investors.


OnlyFans backtracks on its sex ban: why it’s hard for “vice companies” to play both sides

__YouTube: 15-minute killer ab workout...__ You've seen it 1000X. Shares of __[Dick’s Sporting Goods](https://robinhood.com/stocks/DKS)__ jumped 13% yesterday, after the self-explanatory company revealed quarterly sales were 45% higher than *pre*-pandemic levels. During the corona-conomy, we abandoned gyms in favor of at-home workouts and park jogs. Dick's sales of workout clothes, sneakers, and golf clubs spiked. But even as gyms reopen, the athleisure lifestyle is sticking — and Dick's stock has more than doubled this year.

__Year(s) of the yoga mat...__ Retail spending is rebounding as recovery continues, and is on track to pass pre-pandemic levels. Part of the boost: some pandemic trends are still trending. Sales of activewear, athleisure, "comfort clothes," and sports gear are booming. 

- __Avoiding gyms:__ Sales of health and fitness equipment more than doubled from March to October, and the market is expected to continue growing in the coming years. 
- __Getting outside:__ Four in 10 former gym members plan to switch to running or outdoor exercise this year, according to a recent survey. 
- __Staying comfy:__  __[Urban Outfitters](https://robinhood.com/stocks/URBN)__ sales more than tripled last quarter, thanks to a big boost from its Free People activewear sub-brand, “Movement.” 

_Find me at the club [Westend61 via GettyImages_

Golf

__The future is active…__ and retailers are trying to keep pace. Companies that offer activewear lines or sports gear, like Urban and Dick’s, saw sales surpass pre-pandemic levels. Retailers that *haven’t* focused on athleisure haven't seen the same benefits: Sales at fashion-forward __[Nordstrom](https://robinhood.com/stocks/JWN)__ were still below pre-pandemic levels last quarter. Now, Dick’s is [opening](https://www.dispatch.com/story/business/2021/08/06/dicks-sporting-goods-open-new-concept-store-polaris/5502656001/) a new outdoors-focused store concept this fall, and Urban plans to open 20+ new Movement stores this year and next.

Dick's Sporting Goods is thriving because the athleisure life just won't stop 

🎥 OnlyFans' "vice" problem

__Bought it on Insta...__ The ads know you so well. Two big developments dropped this week in the world of "social commerce" — aka: shopping through social media. __TikTok__ is testing "[TikTok Shopping](https://techcrunch.com/2021/08/24/tiktok-expands-shopify-partnership-pilots-tiktok-shopping-in-us-uk-and-canada/)" tabs in North America and the UK through an expanded partnership with ecomm platform __Shopify__. Meanwhile, __Instagram__ is [launching](https://www.reuters.com/article/us-facebook-instagram-advertising/instagram-rolls-out-ads-on-shop-tab-globally-idUSKBN2FP18X) advertising on its Shop feature *globally*.

- __Instagram Shop__, which [launched](https://snacks.robinhood.com/newsletters/7Fl0kcKPHzNEVEVwnee0Zp/articles/7GbosmnxcsEDfjk2yPdKh6/) last year, lets businesses set up digital storefronts on their pages. In some cases, you can pay directly through Insta with Facebook Pay. FB gets a small fee per purchase.
- __TikTok Shopping:__ Should've been TikShop (TokShop?). Shopify merchants with a "TikTok For Business" account can add a “Shopping” tab to their profiles and create mini-storefronts. __Kylie Cosmetics__ will be an early adopter. But shopping takes place in the merchant's Shopify-powered site. 

__"Link in bio"...__ *So 2020*. US social commerce sales are [expected](https://www.emarketer.com/content/social-commerce-surpasses-30-billion-us) to exceed $35B this year, up 36% from 2020. New shopping features from TikTok and Insta are fuel for the creator economy, which relies on affiliate sponsorships. TikTok Shopping will give Shopify merchants — and their influencer partners —  the ability to tag products in their videos. Instead of just posing next to a bottle of protein powder, you can also link it.


_"Hold on, let me shop this Tok" [Nick David/Stone via GettyImages]_

TikShop

__Social commerce = the friction-killer...__ from discovery to checkout. Our purchasing decisions are often influenced by social media — remove the friction, and ads become even more effective. You spot pleather boots in a post and buy them directly through Insta, instead of entering a Google rabbit hole. That seamlessness is extra-valuable for advertisers, which means social giants can charge even more for ads. That's why Twitter, Pinterest, and Snap are also doubling down on shopping features – think: branded makeup filters on Snap.

Tap-to-buy mania: TikTok launches Shopping, and Insta drops Shop ads

__Hold on to your cupcakes and car mufflers…__ There’s a new last-mile delivery service in town. Walmart is opening up its delivery network to outside retailers with a new program called GoLocal. The deets:

- __Retailers won’t need to sell in Walmart’s marketplace__ to use GoLocal, so even small shops can deliver products from store to customer. And don't expect those giant Walmart trucks: GoLocal is un-branded. 
- __Only Walmart workers__ will fulfill GoLocal deliveries — unlike existing Walmart delivery, which also uses third-parties like FedEx, Doordash, and Uber.

__Racing for the last mile...__ The same-day delivery market is expected to triple between 2020 and 2026. Amazon set the standard: Prime same- and one-day shipping was available for 72% of Americans in 2019. But Walmart has invested heavily in its same-day Express Delivery in the past three years. It now covers 70% of the US population. Here’s how the mega retailers compare:

- __Similar most of the way:__ Walmart and Amazon both operate massive ecommerce sites and shipping networks, and Amazon’s slowly expanding into IRL stores, where Walmart has long thrived. 
- __Different for the last mile:__ Walmart’s doubling down on last-mile delivery. But Amazon’s going the opposite direction — it shut down its delivery platform for retailers in 2020 and prioritized warehousing instead. 


Un-brand

__“Un-branding” can be big business...__ Corporate giants can use their massive footprints to help other businesses scale — and profit in the process. With its white-labeled delivery service, Walmart — the second biggest US ecomm retailer — will have a new revenue stream. Other big businesses also sell unbranded services B2B: Target sells delivery tools to 120 retailers, Zoom sells its video-conferencing tech to other apps, and DoorDash sells its backend platform to stores that want delivery services. 

Walmart opens its delivery network to mom-and-pop shops — because un-branding can be big business

🛍 TikTok Shopping has landed

__Feels like deja vu...__ It's not. The FDA granted full approval for __Pfizer__ and partner __BioNTech's__ Covid vaccine. Thanks to emergency use authorization, 201M people in the US have gotten at least one vax shot. Pfizer's is the first vax to gain FDA-approval — it was also the first to get [authorized](https://snacks.robinhood.com/newsletters/pU1g3dpFi4Omfdzze7Vk7/articles/7rFjfW440jpXRwFrc4Wvk8/) for emergency use in December. Pfizer shares spiked 4% on the news. Moderna, whose application for full approval is under review, also closed the day up 7%.  

__The shot is hot…__ While 73% of US adults are vaxxed, vaccine demand remains strong globally. Less than 2% of people in Africa are vaxxed, and many countries are still clamoring for vaccines. Meanwhile, vaccine demand is surging in states hardest hit by the Delta variant. Now, FDA-approval could boost vaccine demand even more:

- __Less vax hesitation:__ Many health officials believe full approval could encourage vax-hesitant people to get the shot. In a recent poll, 30% of unvaxed people said they’d be more likely to get a shot if it were fully approved.
- __More vax mandates:__ The full stamp of FDA approval will make it easier for businesses and other orgs to require shots. United Airlines, the Defense Department, and New York City schools are already mandating it for employees. 


__Covid vaccines are here to stay…__ and so is vax cash. Pfizer expects a whopping $33.5B in Covid vax sales this year, and that forecast came *before* it got full approval. Analysts expect that next year's Covid vax sales will significantly surpass 2021 levels, and remain strong for years.  Pfizer’s 2022 Covid vax sales are expected to be 70% higher than this year’s. And don't forget the booster shots: health officials recommend that Americans who got Pfizer or Moderna's shot series get a booster eight months after their second shot. 

It's official: Pfizer's Covid vaccine snags full FDA approval, setting the stage for more shots

__Just when you thought it was over...__ *Think again*. The CA gig-worker law saga has more sequels than *Fast & Furious*. On Friday, a California judge [ruled](https://www.wsj.com/articles/proposition-22-is-unconstitutional-california-judge-says-11629512394) that Prop 22 is unconstitutional and unenforceable. In November, CA voters overwhelmingly [passed](https://snacks.robinhood.com/newsletters/7jMUu1TK8PviqbKCFjQhjC/articles/f06IOakKwXbXOcwTVNbjX/) the ballot measure, which has classified gig drivers as independent contractors.  

- __The most expensive ballot__ measure in CA history: __Uber__, __Lyft__, __DoorDash__, __Instacart__, and others spent more than $200M to support Prop 22. Uber and others say their drivers largely back the prop, but labor unions say it's a bad deal for workers. 
- __Next steps:__ Gig companies are appealing the ruling, and *won't* have to immediately reclassify workers. But it's a major wrinkle in their effort to preserve the gig model.

__9 to 5 at Uber Eats...__ Means no moonlighting for __Grubhub__. With Prop 22, gigs drivers gained new benefits like: health insurance if you work at least 15 hours per week, at least 120% of minimum wage, and 30 cents reimbursed per mile driven. If Prop 22 is overturned...

- __For drivers:__ Drivers would get full-time benefits (think: sick leave and PTO). But because they'd be employees, they would have to work a set schedule of hours, and could lose the flexibility to work multiple apps. 
- __For consumers:__ Expect even [higher prices](https://www.bloomberg.com/news/articles/2021-08-22/californians-face-higher-rideshare-bills-with-prop-22-reversal) and longer waits. To fund a more expensive workforce, companies would pass costs to consumers and may cut drivers. Ride-hail prices have already soared 53% in the first half of this year due to driver shortages and the new Prop 22 benefits. 

_When the Uber is 57 minutes away: Plan B [Westend61 via GettyImages]_

__The gig economy is at existential risk...__ If the CA judge's ruling is upheld, chronically unprofitable apps like Uber and DoorDash would likely become even *more* unprofitable. As the most populous US state, California is a critical market for gig companies — and its decision could shape gig law across the country. A Prop 22-like ballot will be voted on in Massachusetts next year. The outcome of CA's ruling could set a precedent. 