__May Day was yesterday…__ but worker momentum is just heating up. US labor unions have been making headlines as looming deadlines could lead to a power shift. Most pressing: the 11.5K film and TV writers represented by the Writers Guild of America are [set to strike](https://www.nytimes.com/2023/04/30/business/media/hollywood-writers-strike.html) against studios today, barring an 11th-hour agreement. It’s not just your fave shows that could come to a halt: workers in other key industries are engaged in tense negotiations. 

- __Taking off:__ yesterday 15K __[American Airlines](https://robinhood.com/stocks/AAL/)__ pilots voted overwhelmingly to authorize a strike, though federal laws make it harder for airline unions to join walkouts.

- __Gearing up:__ __[UPS](https://robinhood.com/stocks/UPS/)__ and 340K unionized delivery workers have kicked off contract negotiations for their July 31 deadline. Contracted __[Amazon](https://robinhood.com/stocks/AMZN/)__ drivers in California unionized last month, gaining a $30/hour wage.

- __Foaming:__ About 300 US __[Starbucks](https://robinhood.com/stocks/SBUX/)__ stores have voted to unionize so far. Last week, federal labor prosecutors alleged that the latte leader refused to negotiate fairly at 144 locations.

__Big stories, low numbers…__ Despite splashy organizing efforts, US union membership was just 10% last year, the lowest rate on record. Still, Americans’ support of unions is nearly at a 60-year high, with over half seeing the decline of organized labor as negative. Meanwhile, with historically low unemployment and still-high inflation, workers’ wage expectations are rising, reaching $76K/year in March.

The union train gains steam (Jason Redmond/Getty Images)

Organized

__The power dynamic’s in flux…__ While the pandemic saw the employee/employer dynamic tilt in favor of workers in areas like remote work and wage hikes, layoffs and RTO plans have shifted power back toward the boardroom. But even in defeat, labor movements can bring about change: public criticism of a blocked nationwide rail strike in December led major rail companies to grant workers paid sick leave.

While union membership is at a record low, US labor movements are gaining steam

__Inflation nation…__ As Argentina’s economic crisis [deepens](https://www.reuters.com/markets/rates-bonds/argentina-plans-huge-rate-hike-91-stem-peso-slide-inflation-source-2023-04-27/), its citizens are relying on the *dolar blue*, aka the US dollar. Inflation breached 100% last month for the first time in decades as prices doubled. To combat that, Argentina’s central bank jacked its interest rate by 10 percentage points, to 91%, last Thursday — tacking on to a massive 300-point lift the week before. 

- __For context:__ The Fed has cranked the US’s rate to about 5% from zilch over the past year, in response to inflation that hit 9%.

- __Not enough:__ For Argentina, 20 to 30% inflation is typical, but triple digits means time to hit the panic button. However, aggressive rate hikes, along with price freezes and other scattershot attempts to cool prices, aren’t working.

__*Dollarization* nation…__ Argentines trust the greenback to maintain its value more than the peso. The USD has become so prevalent in the country that some experts think its circulation there is second only to the US. Argentines trade pesos for American dollars at illegal swap hubs, where the exchange rate is often cranked to double the official rate.

- __Paging Washington:__ One of Argentina’s presidential candidates, Javier Milei, wants to fully swap the national currency out for the USD and dissolve the country’s central bank. FYI: 11 countries, including Ecuador and Zimbabwe, use the USD as their currency.

Greenback

__The buck still has Superman status…__ Concerns about the US dollar being dethroned as the world’s “[Superman Currency](https://sherwoodmedia.com/snacks/newsletters/4ogc6lVdR6XOMD2eU3NQcI/articles/4tXfBbA0fHrtQFfTkjI5ht/)” may be overblown. Despite its value slipping this year, the USD is still relied on as the world’s go-to currency for international purchases (think: oil trades), accounting for 58% of global forex reserves. Meanwhile, other countries’ preference for the dollar can make their own currencies weaker.

Argentina leans on the US dollar as the value of its national currency tanks

🐋 *When you're so big even your tiniest move makes a splash…*

A "crypto whale" is a person or entity that holds so much cryptocurrency that they have the power to affect its price. Picture: selling large amounts of a token at once. __Binance__-owned __CoinMarketCap__ said it'll [launch](https://www.coindesk.com/web3/2023/05/01/shark-tank-but-make-it-crypto-coinmarketcap-launching-new-competition-tv-show/) a reality-TV show, "Killer Whales," which will feature entrepreneurs pitching web3 biz ideas to a panel of whales and investors. Picture: “Shark Tank” for crypto.

DEFI(NE)

Heard on the Block: "crypto whale"

Dow Jones

S&P 500

Nasdaq

Bitcoin

“The Super Mario Bros. Movie” is the first film of the year to top $1B+ in sales

📣 US workers get loud

__Getting your posting permit…__ could soon be a new rite of passage. Last week federal lawmakers [introduced](https://www.cnn.com/2023/04/26/tech/senators-social-media-kids-wellness/index.html) a bipartisan bill that seeks to establish a national minimum age for posting on social. The “Protecting Kids on Social Media Act'' would bar platforms like __TikTok__, __[Snap](https://robinhood.com/stocks/SNAP/)__, and __Instagram__ from letting kids younger than 13 create accounts — *and* require platforms to get parental consent to open accounts for users under 18. Studies have linked social media use to anxiety and depression in teens.

- __Social-media security #?__ The bill aims to create a government-run age-verification system based on identity-validating documents (though companies could use in-house tech to perform the check).

- __*Not* recommended for you:__ Social platforms would be barred from surfacing targeted content to minors. Not included: tween-fave gaming services like __[Roblox](https://robinhood.com/stocks/RBLX/)__ and Fortnite.

- __Comments section:__ Supporters want to limit platforms’ ability to keep kids scrolling endlessly, but critics say enforcement would require massive data collection and could infringe on free-speech rights. 

__Sweet 16 FOMO…__ This year intensifying scrutiny of social media’s effect on kids has led to new legislation. The bipartisan “Kids’ Online Safety Act” is set to be reintroduced in the Senate, and another bill, proposed in February, would set a social age threshold of 16. Age-verification laws were passed in Arkansas and Utah recently, with Utah adding a 10:30 p.m. social curfew for kids. This year dozens of US school districts have sued platforms like TikTok, __Meta__, and __YouTube__, alleging they’re “knowingly creating this unprecedented mental-health crisis.”

Social-media curfew incoming (Matt Cardy/Getty Images)

Social

__Time (online) is money…__ Engagement = $$ in the form of ads served. Half of US teens say they’re online “almost constantly.” They’re the most engaged demographic, and the most susceptible to negative mental-health effects. Platforms might see their revenue threatened by rules for minors. The bill’s cosponsor Sen. Brian Schatz predicted an “army of lobbyists” would fight it from becoming law.

From curfews to bans, US lawmakers set their sights on new social-media rules for kids

__Big Macs and barbacoa…__ Fast-food chains have posted tasty results as Americans splurge on affordable treats. Last week __[McDonald’s](https://robinhood.com/stocks/MCD/)__ delivered a 63% profit surge as more folks hit the Golden Arches despite pricier burgers and nuggets. __[Domino’s](https://robinhood.com/stocks/DPZ/)__ and __[Chipotle](https://robinhood.com/stocks/CMG/)__ also topped estimates as consumers stomached higher prices. Quick-serve joints have benefited as inflation curbs appetites for full-service restaurants. We’ll see whether the deep-fried frenzy is still sizzling when Taco Bell and KFC parent __[Yum Brands](https://robinhood.com/stocks/YUM/)__ reports along with __[Papa John’s](https://robinhood.com/stocks/PZZA/)__ and __[Shake Shack](https://robinhood.com/stocks/SHAK/)__.

__Wave szn buffet…__ Cruise companies __[Royal Caribbean](https://robinhood.com/stocks/RCL/)__ and __[Norwegian Cruise Line](https://robinhood.com/stocks/NCLH/)__ are on deck to report. If rival __[Carnival](https://robinhood.com/stocks/CCL/)__'s earnings are any indication, the industry’s January-through-March “wave season” was hot. Carnival said it achieved record quarterly booking volumes during a “phenomenal” season, with sales at 95% of 2019 levels. Still, its bottom line was sunk by a nearly $700M loss. While cruise demand has rebounded as Americans splurge on experiences, higher costs (think: fuel) could weigh down profits.

Events

Coming up this week

__Raise the roof…__ The debt-ceiling clock is ticking. The US hit its $31.4T debt limit in January, prompting Treasury Secretary Yellen to deploy “extraordinary measures” to keep the economy running. Last week the GOP-led House passed a bill to raise the ceiling. While the Biden admin said it has “no chance” of becoming law, it could spark negotiations as the default deadline looms. The stakes are high: if the US defaults on its debt (read: can’t pay its bills), one-tenth of all economic activity could grind to a halt, __[Goldman Sachs](https://robinhood.com/stocks/GS/)__ estimates.

__Jet not set…__ Summer vacays just got complicated. __[Boeing](https://robinhood.com/stocks/BA/)__ is pausing some jet deliveries after an eagle-eyed worker spotted a “gnarly” flaw in nearly three-quarters of its stored 737 Max jets. __[Southwest](https://robinhood.com/stocks/LUV/)__ now expects fewer of the popular jets than promised, and plans to cut hiring because of Boeing’s delays, even as the industry faces a labor shortage. It’s bad timing: airlines like __[Delta](https://robinhood.com/stocks/DAL/)__ are seeing record summer bookings as travel demand takes off. __[American Airlines](https://robinhood.com/stocks/AAL/)__ CEO said that delivery issues force it to cancel flights.

Zoom Out

Stories we’re watching

- __[Recap](https://sherwoodmedia.com/snacks/newsletters/53MKlMHoQHBnGkcCJEn2o5/articles/5DdDjfYTH1CTFVXeI1itWV/):__ Investors sighed after __[Amazon](https://robinhood.com/stocks/AMZN/)__, __Alphabet__, __Microsoft__, and __Meta__ delivered better-than-anticipated earnings last week, showing how low expectations have fallen. Also: tech execs could *not* stop saying “AI.”

- __[K-Flix](https://sherwoodmedia.com/snacks/newsletters/1LDr8wn4Ih9T8WYGyY3SZa/articles/4bDazogzJuEaEooYGo2eWj/):__ More “Squid Game” please. __[Netflix](https://robinhood.com/stocks/NFLX/)__ plans to splurge $2.5B to produce South Korean content, which was watched by *over half* of subscribers last year. From K-pop to K-drama, Korea has become an entertainment powerhouse.

- __[Cleanup](https://sherwoodmedia.com/snacks/newsletters/48bbCfnWRsuLXxDs0G1SaW/articles/6dlkE04VAl9EdkzbXIQqLX/):__ __[Norfolk Southern](https://robinhood.com/stocks/NSC/)__ said the derailment of one of its trains — which spilled toxic chemicals into an Ohio town — would cost it nearly $400M. The disaster has led to broader scrutiny of the rail industry’s safety practices.

ICYMI

Last week's highlights

This year EVs are expected to account for nearly one-fifth of global car sales

🔞 No kids allowed (to post)

__Scrollin’ with the homies…__ Investors sighed after __[Amazon](https://robinhood.com/stocks/AMZN/)__, __[Alphabet](https://robinhood.com/stocks/GOOGL/)__, __[Microsoft](https://robinhood.com/stocks/MSFT/)__, and __[Meta](https://robinhood.com/stocks/META/)__ delivered better-than-feared quarterly earnings this week. Those four make up about 15% of the S&P 500, and their results lifted the broader market. “AI” was a favorite in earnings calls, with Microsoft mentioning it *50 times*. Other highlights: 

- __Amazon__ unboxed expectation-beating revenue growth, helped by solid gains in its #ad biz. The Prime padre said AI investments have helped it surface more relevant sponsored listings.

- __Meta__ spiked 15% after it surprised investors with its first quarterly sales growth *in a year* and gave upbeat guidance as it served up more ads. Time spent on Instagram surged 24% thanks to AI recs and TikTok-esque Reels.

- __Alphabet__ popped after the Google parent beat expectations, though ad revenue and profit fell from last year as YouTube advertising sagged.

- __Microsoft__ also topped estimates, though quarterly sales grew just 7% after previous years of double-digit gains. AI-powered Bing had 100M+ daily users. 

__From Insta Stories to industry stories…__ Tech earnings paint a broader picture of consumer and corporate demand. Some trends: 

- __Ad-pocalypse not now?__ Google said it’s still suffering from an ad pullback, but Meta pleasantly surprised. Social-media ad growth is expected to accelerate this year.

- __AI on the prize:__ Meta CEO Zuck said AI recs were boosting social engagement, while Microsoft said bots would drive revenue growth in its productivity tools.

- __Cloud__ growth is slowing for Google, Amazon, and Microsoft as companies cool their spend, but it held up better than forecast (Google finally turned a cloud profit).

When copying TikTok pays off (Drew Angerer/Getty Images)

Recap

__Low bars are easier to clear…__ Earnings expectations were low, with S&P 500 companies forecast to report the worst profit decline since lockdown-era 2020. After years of double-digit revenue growth being the norm for Big Tech, now investors are cheering baby gains. Meta stock popped to a one-year high despite its profit plunging by nearly $2B.

Big Techies surge after surprising investors, showing how low expectations have fallen

__Plz fix…__ A sharp-eyed __[Boeing](https://robinhood.com/stocks/BA/)__ employee deserves a bonus after [detecting](https://www.bloomberg.com/news/articles/2023-04-26/boeing-says-170-stored-max-jets-need-repairs-for-gnarly-defect?srnd=premium) a “gnarly” but hard-to-spot flaw in nearly three-quarters of stored 737 Max jets. Boeing said the defect isn’t safety-related, but it is putting deliveries of the popular model on hold just as travel heats up. 

- __Jet not set:__ Boeing will deliver fewer planes than planned for the next several months as it addresses the problem.

- __Wing it:__ The company still expects to meet its annual targets by boosting 737 Max production later this year. __[Southwest](https://robinhood.com/stocks/LUV/)__ was set to receive 90 Max jets this year, but now expects 70.

- __FYI:__ In its quarterly earnings this week, Boeing said sales were up 28%, while its loss narrowed as aircraft demand was hot. 

__Bad timing…__ Everyone’s dreaming of a “White Lotus” summer (minus the drama). The TSA’s expecting a record-breaking year for flights, and some analysts say this could be the busiest spring ever. Meanwhile, airlines are seeing record summer bookings. __[Delta](https://robinhood.com/stocks/DAL/)__'s summer flights were 75% reserved as of mid-April, and __[United Airlines](https://robinhood.com/stocks/UAL/)__ added 24 global routes to meet eat-pray-lovers’ demand. __[Hilton](https://robinhood.com/stocks/HLT/)__ unpacked strong #s this week as hotel bookings quadrupled worldwide.

Delay

__A perfect storm could rain on travelers…__ Booming demand + aircraft delays + staffing shortages + airport congestion = summertime blues. Southwest plans to cut hiring as a result of Boeing’s delivery delays, even as the industry faces a labor shortage that has NYC airports so short-staffed that airlines are cutting scores of flights. American Airlines’ CEO said this about aircraft-delivery delays: “Guess what? We’re going out and having to cancel flights.”

Boeing halts some plane deliveries just as summer vacays get ready for takeoff

💰 __Costly…__ __Binance.US__ [backed out](https://www.coindesk.com/policy/2023/04/26/voyager-lawyers-surprised-binanceus-canceled-1b-deal/) of its $1B deal to buy the assets of bankrupt crypto lender __Voyager__ (a fund infusion that would’ve helped it make its customers whole), citing an "uncertain regulatory climate." 

🌶️ __Spicy…__ __[Coinbase](https://robinhood.com/stocks/COIN/)__ said the SEC is making up rules “on the fly” after [suing](https://www.coindesk.com/policy/2023/04/27/sec-is-alleging-legal-violations-on-the-fly-coinbase-says/) the regulator to force it to issue clearer guidelines. The commission is brewing up its own suit against the US’s largest crypto exchange. 

🤔 __Sus…__ The first NFT insider-trading case went to [trial](https://cointelegraph.com/news/opensea-insider-trading-trial-kicked-off-in-new-york-district-court) this week. The suit, which accuses an ex-__OpenSea__ employee of using confidential token-listing info for personal gain, could set a precedent for the unique asset class.

NFTrial

The Crypto Catch-Up….

US job postings fell 15% in the first quarter, with tech roles leading declines

🤖 Big Tech roundup

__Track record…__ Yesterday, __[Norfolk Southern](https://robinhood.com/stocks/NSC/)__ said that the February derailment of one of its trains — which spilled toxic chemicals into a small Ohio town — would likely [cost](https://www.washingtonpost.com/business/2023/04/26/earns-norfolk-southern/82658592-e42c-11ed-9696-8e874fd710b8_story.html) the company $387M, or about 12% of its profit last year. 

- __Cleaning up:__ The price tag includes $31M pledged to help local residents recover. So far, Norfolk said it’s spent $55M removing contaminated soil and water.

- __Lawyering up:__ That includes legal fees, because Norfolk faces lawsuits from the DOJ, Ohio, and shareholders, among others. 

__The issue runs deeper…__ than just one spill. The National Transportation Safety Board launched a special investigation into Norfolk’s general safety practices. The company’s workforce has shrunk by almost 40% since 2012, a steeper drop than that of rivals __[BNSF](https://robinhood.com/stocks/BRK.A)__, __[CSX](https://robinhood.com/stocks/CSX/)__, and __[Union Pacific](https://robinhood.com/stocks/UNP/)__. From 2013 to 2022, Norfolk’s accident rate spiked more than 80% — nearly 3X the industry average. The Ohio disaster has led to greater scrutiny of the rail industry’s safety practices. 

- __Accidents up:__ In the past decade, the seven major US freight railroad operators have had 27% more accidents. Lawmakers and safety officials point to an industry-wide strategy called Precision Scheduled Railroading, or PSR, as a reason for declining safety.

- __Profits up:__ PSR aims to boost profits by cutting costs and increasing efficiency through measures like lengthening trains (some up to 3 miles long), shrinking staff, and cutting inspection times.

Norfolk Southern’s derailed freight train in East Palestine, Ohio (NTSB/Xinhua/Getty Images)

Locomotion

__Financial efficiency can hurt operational efficiency…__ Since 2010, rail companies have paid shareholders almost $200B through dividends and stock buybacks. While PSR has helped rail corps haul in record profits, it’s also led to widespread safety problems and worker dissatisfaction. In December, President Biden blocked a nationwide rail strike that would’ve cost the US $2B/day.

Norfolk Southern puts a price on its Ohio derailment as rail safety practices come under greater scrutiny

__From Big Macs to Kraft mac…__ Americans aren’t giving up their comfort-food staples. Big food companies have crushed earnings expectations as consumers keep [paying up](https://www.wsj.com/articles/mcdonalds-pepsico-flex-their-pricing-power-dfe2e295?mod=business_lead_pos2) to eat up, despite significant price hikes. It’s a theme: 

- __[McDonald’s](https://robinhood.com/stocks/MCD/)__ beat estimates as US traffic grew for the third straight quarter, amid higher McMenu prices and inflated nuggets. Global same-store sales grew 13%.

- __[Chipotle](https://robinhood.com/stocks/CMG/)__ saw stronger-than-expected traffic and sales growth, while the burrito legend’s prices are up 10% from a year ago (guac = *extra* extra).

- __[Nestlé](https://robinhood.com/stocks/NSRGY/)__, the world's largest food company, also grew sales after hiking prices by about 10% as folks kept grabbing its Kit Kats, Hot Pockets, and "Nes" products (’presso, ’café, ’quik).

- __[Pepsi](https://robinhood.com/stocks/PEP/)__ lifted its annual sales forecast as demand for products like Gatorade, Cheetos, and Doritos stayed strong — after it raised prices by 13%.

- __[Coke](https://robinhood.com/stocks/COKE/)__ had bubbly results, too, as higher prices and rising demand fueled its bev sales. 

__I’ve got the (pricing) power…__ Pricing power = how much companies can raise prices *without* hurting demand. Food companies are flexing that power by showing that consumers are willing to pay more for their goodies, from brand-name sodas like Coke to affordable splurges like Egg McMuffins. Even during economic downturns, people tend to hold on to these little treats.

Bite

__Pricing power has its limits…__ because budgets can stretch only so far. McD’s said that diners in some markets have pushed back more than anticipated against higher prices, and customers are ordering fewer items. Coke noted signs of shifting buying habits, and said it plans to slow price hikes this year. As US retail spending dips, corporate price bumps could flatten.

Big foodies flaunt “pricing power” as consumers stomach higher costs (for now)

__Game changer…__ Yesterday, UK regulators [said](https://www.theverge.com/2023/4/26/23689252/microsoft-activision-blizzard-acquisition-blocked-uk-cma) they’d block __Microsoft__'s $69B acquisition of __[Activision Blizzard](https://robinhood.com/stocks/ATVI/)__, worsening the chances of the deal’s approval. Microsoft’s bid to buy the Call of Duty maker (which would be the largest tech deal *ever*) has been on ice as regulators worry the merger would hurt competition. The Xbox maker has [struck](https://sherwoodmedia.com/snacks/newsletters/3DpeGe1lyARbnRKJrQl0dF/articles/1NLpPKfmkzaijNqlW1eIyh/) deals with rivals like __[Nintendo](https://robinhood.com/stocks/NTDOY/)__ and __[Nvidia](https://robinhood.com/stocks/NVDA/)__ to share its gaming treasures to win support for the Activision-quisition.

- __Stiff odds:__ The FTC is still evaluating the merger after suing to block it in December, and the EU is set to make a formal decision next month.

- __High stakes:__ Microsoft’s already planning to appeal the UK’s decision, but if it fails (or if other regulators nix it) it’ll owe Activision $3B in break-up fees.

__Cloud cover…__ By some estimates, Microsoft already controls 60%+ of global cloud-gaming services, and its Xbox Game Pass has 25M+ subscribers. For reference: __[Sony](https://robinhood.com/stocks/SONY/)__'s PSNow cloud-gaming service had just 3M subs before it was replaced last year. Now regulators argue that Microsoft's ownership of Activision's billion-dollar franchises (like: Call of Duty, World of Warcraft) would make it tougher for others to compete.

__Buyers, beware…__ The UK’s decision is a rare win for supporters of Big Tech regulation, and it could prompt more crackdowns in the US, where major antitrust rulings have been scarce. As governments [get tougher](https://sherwoodmedia.com/snacks/newsletters/1UaryfLlNYafGqkVnZiU00/articles/4pzAi33V9xaok1Q7KIh3Rt/) on protecting competition, tech biggies may have to revisit their M&A strategies, or risk losing billions if they fail.

Microsoft’s $69B Activision takeover is in jeopardy after UK regulators blocked the potentially historic gaming deal

Netflix reportedly lost 1M users in Spain last quarter as it intro’d a password-sharing fee

🚂 Norfolk’s mess raises alarms

__Victory Royale…__ __[Apple](https://robinhood.com/stocks/AAPL/)__ described its day in court versus __Epic Games__ yesterday as “a resounding victory” after 9 out of 10 of the Fortnite maker’s claims [were decided](https://www.cnbc.com/2023/04/24/apple-declares-victory-after-decision-reached-in-epic-games-appeal-.html) in Apple’s favor. Refresher: in 2020, Fortnite was booted from Apple’s and Google’s stores after it directed players to its own discounted payment system to bypass the “app tax.” Epic retaliated by suing both tech titans and making a dramatic “1984” [parody video](https://www.youtube.com/watch?v=euiSHuaw6Q4). The legal saga appears to be over: 

- __Not a mobile-opoly:__ Judges ruled that App Store policies *don’t* break federal antitrust laws. Apple won’t need to allow third-party app stores on iOS devices or change its fees.

__The one claim that got away…__ is the core of Epic’s suit. The ruling says Apple [*can’t* bar](https://www.reuters.com/legal/us-appeals-court-upholds-lower-court-order-forcing-apple-allow-third-party-app-2023-04-24/) developers from steering users to off-app purchasing pages to skirt the 15 to 30% fee that Apple skims off in-app purchases (picture: Beef Boss skins). Read: Epic could allow players to set down their shockwave hammers and leave the Fortnite app to pay outside Apple’s ecosystem. Fortnite hasn’t been on the App Store since 2020, but it could return this year.

- __Giving up a slice:__ Last year, Apple started allowing “reading apps” — including __[Netflix](https://robinhood.com/stocks/NFLX/)__, Audible, and __[Spotify](https://robinhood.com/stocks/SPOT/)__ — to steer customers to alt payment options. Now it’ll have to extend the policy to games, too, if it fails to appeal this week’s ruling.

- __Prob-llama:__ As of 2021, gaming apps made up about 70% of all App Store revenue. If game developers start linking out to other payment options, Apple’s lucrative biz could take a hit.

Tim cooked up a legal victory (Jerod Harris/Getty Images)

Skins

__The walled garden could show cracks…__ Apple (mostly) won this round, but scrutiny of its app-store dominance isn’t over. Authorities in South Korea, the Netherlands, and Japan forced Apple to allow third-party payment systems to be added to apps, and an EU law could mean iOS 17 will open the door to app downloads from third-party app stores (aka: “sideloading”).

Apple declares victory in its App Store battle versus Fortnite, but there’s a banana peel in its path

__From K-pop to K-drama…__ Yesterday __Netflix__ said it plans to [spend](https://www.reuters.com/technology/netflix-invest-25-bln-south-korea-make-tv-shows-movies-2023-04-25/) $2.5B over the next four years to produce South Korean shows and movies, doubling its investment in the market. Over *half* of Netflix viewers watched Korean content last year, and 40% of its most-watched non-English-language shows are Korean, from revenge drama “The Glory” to reality hits like “Single’s Inferno.” As Netflix rolls out its largest-ever lineup of K-content, __[Disney](https://robinhood.com/stocks/DIS/)__, __Amazon__, and __Apple__ are investing in the streaming K-wave. With good reason:

- __Untapped potential:__ Last quarter, Netflix added 1.5M paid subscribers in Asia Pacific, making it the fastest-growing region by far.

- __Red-jumpsuit mania:__ “Squid Game” was a phenomenon, earning a half dozen Emmys and becoming Netflix’s most watched show or film *ever* — topping 110M viewers.

- __Ram-Don gold:__ Korean dark comedy “Parasite” made Oscars history in 2020 as the first foreign-language film to win Best Picture. 

__From “Beef” to Black Pink…__ Korea has become a pop-culture powerhouse and entertainment leader. Just a few examples: K-pop band BTS added $5B/year to the Korean economy (nearly 0.5% of the country's GDP) as the mega-stars took over charts worldwide. This month, the group Black Pink made history as the first Asian band to headline Coachella.

K-wave

__One wave can reach many shores…__ South Korea’s entertainment industry isn’t only boosting the Korean economy; it’s also fueling international engagement for streamers as its popularity spreads everywhere. While Hollywood has long been the main purveyor of entertainment, Korea’s solidified its place as an industry leader.

Netflix is splurging $2.5B on South Korean content as a K-wave goes global

Amazon, Alphabet, Microsoft, and Meta make up about 15% of the S&P 500’s market value

🥇 Apple’s Epic “victory”

__Overflowing chip bowl…__ not talking Doritos. Stale chip demand could take a big [bite](https://www.cnbc.com/2023/04/24/samsung-q1-2023-earnings-preview-memory-chip-price-slump-hits-giant.html) out of __Samsung__'s earnings this week. The South Korean tech titan is the world’s largest producer of memory chips, which are used in everything from smartphones to computers to servers. Memory-chip prices dropped 20% last quarter as companies like Samsung slashed prices to cope with an industry-wide glut. Now the flip-phone icon expects its worst quarterly profit since 2009. 

- __Short circuit:__ Earlier this month, Samsung said it would begin a “meaningful” chip-production cut, following similar moves by rivals like __[Micron](https://robinhood.com/stocks/MU/)__ and __[Western Digital](https://robinhood.com/stocks/WDC/)__.

- __Unchipper:__ Semiconductor giants have been losing money on every chip they churn out. Samsung's chip unit is forecast to post a record $1.6B loss on Thursday.

__Boom and bust…__ Tech gadgets were hot commodities midpandemic as homebound consumers splurged on new PCs, TVs, and phones. But demand for $1K flat screens has cooled, hurting chipmakers (which boosted production to ease “the great chip shortage”). Now they’ve got *too many* chips. The industry is notoriously cyclical, but the latest oversupply is historic. 

- __Geek Squad problems:__ Last quarter, __[Best Buy](https://robinhood.com/stocks/BBY/)__'s profit fell 42%, and it hinted at slower sales ahead. __Microsoft__ expects a PC sales slump “for the foreseeable future,” and __[Apple](https://robinhood.com/stocks/AAPL/)__'s Mac deliveries plunged 40% last quarter (worse than its laptop rivals).

Too many chips, not enough dip (Jakub Porzycki/Getty Images)

Chip-dip

__Not all chips are created equal…__ It depends on what’s in demand. While appetite for personal devices like PCs and phones has cooled, demand for AI-powering tech is heating up. Chipmakers like __[Intel](https://robinhood.com/stocks/INTC/)__ and __[Nvidia](https://robinhood.com/stocks/NVDA/)__ are going all in on AI, and the AI hardware market could hit $90B by 2030 (up 8X from 2021). __Nvidia__ shares have surged on hunger for its AI chips, which are selling for up to 20X more than its gaming processors.

Samsung could post its worst profit in decades as the great chip shortage turns into a glut

__Clearin’ the cache…__ more like cash. China’s prepping its digital piggy bank to pay public workers in the city of Changshu (population 1.7M) *fully* in digital yuan (#digi-yuan) starting next month. The project will affect all public workers, from teachers to government officials — and marks the country’s [biggest push](https://www.cnn.com/2023/04/24/economy/china-digital-yuan-government-salary-intl-hnk/index.html) to circulate its digital currency.

- __Number yuan:__ Back in 2021, China [became](https://sherwoodmedia.com/snacks/newsletters/5gmxJQUqpvzHWE4CeHvylQ/) the first major economy to launch an e-currency. Over 100 countries, including the US, have been playing catch-up since.

- __Mixed reaction:__ Changshu’s digi-yuan project is trending on Chinese social media. While some say it could help curb government corruption, others worry that older people will struggle to take their finances online. 

__Sorry, anon…__ All digi-yuan transactions are recorded on a digital ledger that’s monitored by the Chinese government, giving the surveillance state even tighter control (picture: digi-yuan expiration dates to boost spending). Chinese citizens lead the way in global mobile-payment adoption, but getting them to use digital *yuan* could depend on integration with payment superapps:

- __Tap to pay:__ Alipay and WeChat Pay each have 1B+ users and process hundreds of billions of dollars’ worth of annual transactions. China has struggled to get its citizens to use its digi-yuan app, because most of them use superapps for payments and social interactions.

- __Competing with corporate:__ The digi-yuan was tested as an express payment option on Alipay last year, and China could exert greater pressure on tech companies to fully integrate it.

Digi

__The e-conomic race is on…__ China, India, Nigeria, and a handful of other countries have launched digital currencies. Now China is positioning the digi-yuan for international use, which could offer an attractive alternative to the US dollar for sanctioned countries like Russia. Meanwhile, the US Treasury is [reportedly](https://markets.businessinsider.com/news/currencies/cbdc-dollar-treasury-crypto-stablecoin-digital-trm-government-token-currency-2023-3) close to finishing its development of a digital dollar, which could give millions of unbanked Americans access to digital payments.

China plans its biggest digital-currency rollout, accelerating the global race to turn cash into code

Last year, global military spending hit a record $2.2T

📱 The great chip glut

__Not just platinum problems…__ Last week __[American Express](https://robinhood.com/stocks/AXP/)__ said it had set aside $1.1B — way more than expected — to cover potential loan losses. Amex isn’t the only lender worried about delinquencies. US consumer debt hit a record $4.82T in February, and Americans are starting to fall behind on credit-card and loan payments. Driving the IOU pileup: pandemic savings have dried up, wages are lagging behind inflation, and rising interest rates have become a national frenemy. 

- __Enemy/friend:__ Folks hate high rates on their debt (picture: car payments at 15-year highs), but they dig higher returns on their savings.

- __APYes:__ Last month the average annual percentage yield (aka: return) for online savings accounts reached 3.75%, up from just 0.5% a year earlier.

- __Interest chasing:__ 30% of US customers moved $$ between banks last month, and a third of those said they were searching for a higher APY — which also just hit a 15-year high. 

__Smilin' while they're cryin’...__ The double-edged sword of higher rates is jabbing banks too. Last quarter, the four largest US lenders wrote off $3.4B in loans (up 73% on the year) as consumers struggled to pay down debts. __[Citi](https://robinhood.com/stocks/C/)__, __[JPMorgan Chase](https://robinhood.com/stocks/JPM/)__, and __[Wells Fargo](https://robinhood.com/stocks/WFC/)__ recently set aside a combined $2B to cover potential loan losses. But there’s a corporate plus side to climbing rates: this month, those same banks reported expectation-busting earnings as rising rates on customer loans (like mortgages) padded their coffers. They expect profits to increase if hikes continue.

Good interest, bad debt (jayk7/Getty Images)

CA$H

__Cash is cool again…__ Now that investors can earn higher interest on their cash, some are parking more $$ in interest-bearing accounts like money-market funds and savings. That can be bad news for stocks, since investors demand higher returns from equities to justify the changed opportunity costs. Meanwhile, banks are competing to offer higher APYs than rivals as the Fed continues raising rates. At least one more hike’s expected in May.

The double-edged sword of rising rates has consumers chasing interest and collecting IOUs

__Big tech on deck…__ __[Google](https://robinhood.com/stocks/GOOGL/)__, __[Microsoft](https://robinhood.com/stocks/MSFT/)__, __[Amazon](https://robinhood.com/stocks/AMZN/)__, and __[Meta](https://robinhood.com/stocks/META/)__ are set to report, but slow growth (and high costs) could zap results. Last quarter, Microsoft missed sales expectations as PC and cloud demand cooled. Google disappointed as YouTube ads sagged. And despite Meta's cost slashing, analysts expect it to report its sixth straight quarter of declining profit. Tech stocks have jumped this year on hopes that the Fed would start cutting rates, but it may not be enough for a profit rebound.

__Next stop…__ cleanup. __[Norfolk Southern](https://robinhood.com/stocks/NSC/)__ will report for the first time since one of its trains derailed in Ohio in February. The rail giant faces suits from the DOJ and Ohio, among others, after the disaster spilled toxic chemicals. Norfolk says it’s paid out $28M for cleanup so far, but the full price tag could be much higher. Since 2012, Norfolk’s workforce has shrunk 39% and its accident rate has spiked 80%. Experts think understaffing could be an industry-wide challenge. Last week, rival __[Union Pacific](https://robinhood.com/stocks/UNP/)__ delivered muted #s.

__Fake Drake, real problems…__ Last week, an AI-generated [song](https://sherwoodmedia.com/snacks/newsletters/uzEZxUPPSYMbU0vFmw7x6/articles/6gm3kr2ZvPPHvH6m9HMS9K/) featuring the voices of Drake and The Weeknd racked up millions of streams across TikTok, YouTube, __[Spotify](https://robinhood.com/stocks/SPOT/)__, and other platforms. __Universal Music Group__, the world’s largest label, which reps the artists, had the song taken down on infringement grounds. Then *another* Drake fake was uploaded. Labels like UMG, __[Warner](https://robinhood.com/stocks/WMG/)__, and __[Sony Music](https://robinhood.com/stocks/SONY/)__ have aggressively protected their music (think: YouTube vids removed), but AI tracks could be a game of Whac-a-Mole until rules are established. 

__Selling the forest for the trees…__ just in time for Arbor Day. American logging titan __[Weyerhaeuser](https://robinhood.com/stocks/WY/)__ has found a profitable new venture in carbon offsets: credits that can be bought by companies to counteract their industrial emissions. A Wall Street Journal [report](https://www.wsj.com/articles/weyerhaeuser-logging-carbon-emissions-offset-market-environment-76850c01) found that the tree-chopping lumber producer is selling the CO2-sponging abilities of its 10.6M acres of forest to companies looking to cut emissions. But critics say the environmental-benefit math is fuzzy. The logger expects to generate $100M/year selling offsets by 2025.

Zoom out

- __[Beef](https://sherwoodmedia.com/snacks/newsletters/4sfDTlSxcdd08EIrnBUeZN/articles/3C63s0BazHEPyP2yeDtwqM/):__ __[Netflix](https://robinhood.com/stocks/NFLX/)__ added 1.7M subs last quarter, fewer than half what Wall Street was expecting. But the streamer hopes its password-mooching crackdown will fuel growth once the “cancellation reaction” wears off.

- __[Cut](https://sherwoodmedia.com/snacks/newsletters/C6iqmgjbPZvinLvNy5aW9/articles/7IZVFG7vLrLUdDAEfQHDx7/):__ The Writers Guild of America approved a strike if an agreement isn’t reached with studios by May. Streaming has led to a drop in writer payouts, but old rules may be catching up to disruptors.

- __[Angst](https://sherwoodmedia.com/snacks/newsletters/C6iqmgjbPZvinLvNy5aW9/articles/qAbjItXhlorcEgsK92dKc/)__: Gen Z and millennials are racking up record debt as financial avoidance leads to retail therapy and the bar for “doing OK” rises. US workers are now demanding a minimum of $76K to start a new job.

In 1991, Mall of America gave Sears a 100-year lease on a three-story spot for $10/year

⚔️ Double-edged rate sword

__Nice for bot…__ ICYMI: an AI-generated song featuring the voices of Drake and The Weeknd went viral this week. “Heart on My Sleeve,” posted on TikTok by a bed-sheet-clad user called Ghostwriter977, racked up [millions](https://www.axios.com/2023/04/19/ai-fake-drake-weeknd-song-streaming-services-removed) of streams across YouTube, __[Spotify](https://robinhood.com/stocks/SPOT/)__, Apple Music, and other platforms. The ghostwriter said they wrote and produced the verses for the AI-generated vocals. Then came the takedowns: 

- __Universal Music Group,__ the world’s largest label, which reps Drake and The Weeknd, had the song removed from platforms.

- __Legal verse:__ Universal said “the training of generative AI using our artists’ music” violates copyright law and that “we will not hesitate to take steps to protect our rights and those of our artists.” 

__Fake Drake(s) aren’t the only problem…__ Universal was quick to act, but now *another* Drake fake (“Winter’s Cold”) has hit the internet. Labels like UMG, __[Warner Music Group](https://robinhood.com/stocks/WMG/)__, and __[Sony Music](https://robinhood.com/stocks/SONY/)__ have been effective in aggressively protecting their music (think: YouTube videos and Insta stories being taken down or demonetized). Platforms like YouTube scan videos to see whether they contain copyrighted content, so identification is nearly instant. But AI tracks could be harder to spot. For consumers, it’s also tough to know if a track is authentic because Auto-Tune (used to synthetically improve tracks) is so prevalent.

Champagne Papi meets AI copies (Frazer Harrison/Getty Images)

Drizzy

__It may be endless Whac-A-Mole…__ until hard rules are established for AI-generated content. Copyright issues will likely keep popping up, and not just for the music industry: [media publishers](https://sherwoodmedia.com/snacks/newsletters/ZFPm5hIgbozaPl1FkBr62/) are said to be gearing up for a showdown with __[Microsoft](https://robinhood.com/stocks/MSFT/)__, __[Google](https://robinhood.com/stocks/GOOGL/)__, and __OpenAI__, demanding compensation for use of their articles. Meanwhile, [AI-art lawsuits](https://sherwoodmedia.com/snacks/newsletters/31MZjQaxwyvgzBaiazKUYy/articles/6JYfIJADVE53b21M5kUtl1/) could set precedents for bots trained on copyrighted artwork.

An AI-generated “Drake” song raises alarm bells for labels like Universal Music

__Meatballs and measuring tape…__ Yesterday __Ikea__ said it would invest $2.2B to build up its US biz — its biggest investment *ever* in a single country. Over the next three years, it plans to roll out 17 new stores, creating 2K+ US jobs. The Swedish sofa king also plans to bulk up its fulfillment centers. It notched record sales last year and has slowly grown its market share in the US (its second-largest market by sales after Germany). Now Ikea’s hoping its trendy “low cost, high quality” furniture will turn the US into its top market. 

- __DIY:__ Ikea’s planning to open nine "plan and order points," studios where shoppers can meet with specialists to design their dream home (but have the furniture delivered).

__The great home retreat…__ (not the relaxing kind). Home-furnishing spend has plunged since the pandemic as people ditch home-office builds for Cabo trips. Furniture-store sales generally dipped 2.4% in March from a year ago. The slowdown is starting to nail some of Ikea’s rivals: last quarter, __[Home Depot](https://robinhood.com/stocks/HD/)__ missed its sales expectations for the first time since 2019. __[TJX](https://robinhood.com/stocks/TJX/)__'s HomeGoods saw a 4% sales dip, and __[Bed Bath & Beyond](https://robinhood.com/stocks/BBBY/)__ is reportedly days from filing for bankruptcy. Online furniture retailer __[Wayfair](https://robinhood.com/stocks/W/)__ lost 5M customers last year and posted a $1.3B loss.

Balling

__One brand’s loss is another brand’s opportunity…__ Ikea’s US biz alone racked up nearly $6B in sales last year, attracting some 70M shoppers in stores and about 500M visits online as it kept prices stable compared to rivals. Now, as competitors like Wayfair cut jobs and scale back, Ikea’s doubling down to grow its market share.

As the home-furnishing boom fades, Ikea’s splurging $2B to take over American living rooms

📜 __Policy…__ European lawmakers [approved](https://www.bloomberg.com/news/articles/2023-04-20/eu-s-mica-crypto-regulations-clear-final-parliament-vote) sweeping crypto regs (meet: MiCA) that are expected to take effect this summer. The rules will allow registered companies to operate across the EU, and have been hailed by crypto cos. About that…

🌶️ __Spicy…__ __[Coinbase](https://robinhood.com/stocks/COIN/)__'s CEO said the biz might [exit](https://www.barrons.com/articles/coinbase-ceo-leave-us-stock-crypto-regulation-6d81c3ce) the US in search of greener regulatory pastures, and that a move to the UK is "on the table." The exod-US isn't all bluster: Coinbase [reportedly](https://fortune.com/crypto/2023/04/19/coinbase-gets-bermuda-license-plans-to-launch-offshore-exchange-in-coming-weeks/) plans to launch an offshore exchange.

🧳 __Movin'…__ __Kraken__'s been hit with the travel bug too. The exchange, which earlier this year agreed to a $30M SEC settlement and killed its staking program, [scored](https://fortune.com/crypto/2023/04/18/kraken-digital-asset-license-ireland-vasp-crypto-abroad-crackdown/) a license to operate in Ireland.

VACAY

The Crypto Catch-Up…

New York City has the world's wealthiest population with 340K millionaires

🎵 Fake Drake, real problems

__RIP red-envelope DVDs…__ this one’s for you. __Netflix__ shares dipped yesterday, and not because the streamer announced it’s ending DVD rentals (was still a thing). It added only 1.7M new subscribers last quarter — fewer than half what Wall Street was expecting. Netflix said subscriber growth would be similar this quarter, but hopes for brighter days ahead. 

- __Play next…__ ad. After rolling out in November, Netflix's $7/month US ad-tier now earns more revenue per subscriber than its standard plan, which costs twice as much.

- __Three months left…__ to use your ex’s password. Netflix delayed its global “paid sharing” plan (ahem, password-mooching crackdown) in the US and other major markets until June. It doesn’t expect the extra $$ to kick in till the third quarter. 

__Are you still watching…__ on Mom’s account? 100M people use someone else's Netflix without paying. In February, the streaming icon launched its paid-sharing plan in countries including Canada, Spain, and New Zealand. Cue: searches for “cancel Netflix account” soared 8X. FYI: nearly two-thirds of zillennials have canceled a streaming sub in the past six months. 

- __But Netflix said the initial “cancel reaction”__ was followed by a boost in subscriptions and revenue. Canadian subs have grown since the crackdown, despite it costing $8/month to add new users to accounts — and revenue there is growing faster than in the US.

The beef is with the password crackdown (Michael Buckner/Getty Images)

Share

__Good content captures eyeballs…__ but must-see content captures wallets. No one wants to pay yet another monthly subscription fee. But Netflix hopes that its multibillion-dollar content budget (and loyal watchers of series like “You” and “Outer Banks”) will shell out to stay. While the “cancel reaction” could lose casual watchers, it may add lifelong subscribers.

Netflix posts anticlimactic results, but hopes its mooching crackdown will fuel growth


__“Cause it's like you're my mirror”…__ but maybe not for long. __[Lululemon](https://robinhood.com/stocks/LULU/)__ [reportedly](https://www.cnbc.com/2023/04/18/lululemon-sale-mirror-hydrow.html) wants to offload its in-home-fitness biz, Mirror, to its competitor __Hydrow__. The soft-pants producer bought the exercise startup for $500M in 2020 as living-room sweat sessions drove sales (goodbye suits and gym memberships, hello leggings and __[Pelotons](https://robinhood.com/stocks/PTON/)__). Now the 70-pound wall-mounted “mirror,” which displays fitness classes, is weighing down profits.

- __Self-reflection:__ In its last reported quarter, Lululemon said it took a nearly $443M impairment charge related to Mirror.

- __Losing more than a few pound$...__ Lululemon discounted the Mirror device to $1K (down from $1.5K) as sales came in below expectations.

__Buffing out the profit problem…__ Mirror's drag on earnings has threatened to sour Lulu's otherwise sweet business. Last month the company's stock stretched up after it beat expectations (picture: a 30% sales jump) and shared rosier-than-expected guidance. Other comfy-first brands that saw a pandemic bump (like __[Crocs](https://robinhood.com/stocks/CROX/)__) have likewise seen customers hesitant to shift back to “hard clothes.” But Lulu's rush into hardware hasn't aged as well as its leggings

Jeff Greenberg / Getty Images

BADLUCK

__Striking while the iron's hot can get you burned…__ when the fad cools. At the height of the pandemic, home-exercise tech was a must-have. Peloton went into overdrive trying to keep up with demand for its stationary bikes, and Lulu scrambled to get in on the action with Mirror. But Peloton ended up with a mountain of unsold bikes, and Lulu with Mirrors gathering dust. From indoor bikes to the metaverse to AI, brands that go big on the hot new thing risk mistaking flash-in-the-pan fads for long-term trends.

Lululemon moves to shed Mirror as a pandemic-era home-fitness bet shows cracks

India has surpassed China as the most populous country

🎬 Netflix’s mooching cut

__EXT. HOLLYWOOD — DAY…__ In a nearly unanimous vote this week, 9K members of the Writers Guild of America [approved](https://www.nytimes.com/2023/04/17/business/media/hollywood-writers-strike-vote.html) a TV and movie writers strike if a new contract agreement isn’t reached by May 1 with studios (aka: their employers). A record 80% of WGA members turned out to vote, signaling clear dissatisfaction among the teams creating your fave shows.

- __Buffering:__ Streamers like __[Netflix](https://robinhood.com/stocks/NFLX/)__ and __[Disney](https://robinhood.com/stocks/DIS/)__+ are playing a major role in the negotiations. Streaming has led to shorter TV seasons and exclusive rights, causing a steep drop in residual payouts to writers (watching “Succession” five times doesn’t count as a rerun). The WGA wants a new formula to account for the shift.

- __WG-AI:__ The union also wants studios to regulate the use of AI — and to bar studios from lowering pay or reducing rights and credits for content that leverages the tech.

- __Not guaranteed:__ The WGA authorized a strike in 2017 but ultimately reached a last-minute deal to avoid one. The last WGA work stoppage, in 2007, lasted three months and cost California over $2B.

__Lights, camera, no action…__ While a strike isn’t certain, Hollywood is making moves to prepare. Streaming platforms have several shows wrapped and ready to roll out in the event of a stoppage, and renewals to shows like “Abbott Elementary” were given out earlier than usual. Networks are also bulking up on animated shows (which are written far in advance) and unscripted TV (maybe Netflix can figure out live reunions by May).

Show business, meet show labor (David McNew/Getty Images)

Scene

__Old rules can catch up to disruptors…__ Now that streaming has transitioned from industry disruptor to industry standard, evading old issues that networks and studios know well (like labor disputes) can only last so long. Similar battles are underway in other tech-disrupted industries like ecomm and ride-hail (think: __[Uber](https://robinhood.com/stocks/UBER/)__'s gig work and taxi union issues).

The WGA approves a Hollywood writers strike, signaling a potential shift for streaming

__Self-soothing with an Amazon order…__ But seven pairs of Crocs won’t help the real problem (neither will that popular fluffy [headband](https://www.wsj.com/articles/tiktok-headband-versed-1d6484e5)). US consumer debt hit a record high of $4.8 *trillion* in February as inflation-strapped Americans took out high-interest loans and maxed out credit cards. The IOU blues are [especially](https://www.wsj.com/articles/young-people-avoid-facing-their-finances-more-than-ever-e853910e?) bad for younger generations:

- __Pricey cold-brew habit:__ Millennials’ average credit-card debt rose nearly 30% in March from a year earlier, hitting a whopping $5.8K, Credit Karma reported.

- __Thrifting or splurging?__ Gen Z’s average credit-card debt soared 40% to $2.8K as Shein hauls and Celsius habits weighed down balances. 

__Need those fuzzy slides…__ to ease the sliding state of finances. April is financial literacy month, but many appear to be choosing “financial avoidance” instead. Sticky inflation, high interest rates, and dwindling savings have fueled anxiety. Psychologists say that ignoring your finances and overspending to cope with stress is typical among younger generations. The pandemic just made it more common. 

- __Saw it on TikTok:__ Social media has exacerbated zillennials’ splurge cycle. Lots of younger users make purchases based on influencer recs, a recent Pew survey suggested. And over 60% of users said they regretted a social-inspired impulse purchase, Bankrate found.

Charge

__The bar for “doing OK” is a lot higher…__ In December, over half of Americans earning more than $100K/year said they lived check to check. As prices rise faster than wages, US workers are demanding a minimum of [$76K](https://www.bloomberg.com/news/articles/2023-04-17/wage-floor-for-us-workers-at-record-76-000-in-ny-fed-survey?srnd=premium) to start a new job — up $2K+ from November. Meanwhile, the overconsumption cycle has also raised the bar for getting by.

Gen Z and millennials rack up record debt as “financial avoidance” leads to retail therapy

20% of Americans who've used buy now, pay later apps have used them to pay for groceries