__“Alexa, stop losing money”...__ There’s trouble in the house Bezos built: __[Amazon](https://robinhood.com/stocks/AMZN/)__ is looking to cut costs, notably in its Alexa division, a WSJ [report](https://www.wsj.com/articles/amazon-has-launched-a-cost-cutting-review-focused-on-unprofitable-business-units-11668094823?mod=business_lead_pos1) says. In the past three years Amazon spent lavishly as ecomm demand surged: it hired 800K+ workers and splurged $10B on acquisitions, including Roomba maker __[iRobot](https://robinhood.com/stocks/IRBT/)__ and health clinic __[One Medical](https://robinhood.com/stocks/ONEM/)__. But now that rising prices are denting profits, the Prime padre is looking to cut costs:

- __Try harder, Alexa:__ Amazon’s Alexa team has 10K+ employees (about as many as __[Snap](https://robinhood.com/stocks/SNAP/)__ and __[Airbnb](https://robinhood.com/stocks/ABNB/)__ *combined*) and has lost up to $5B annually in recent years. Now Amazon is said to be encouraging Alexa workers to find jobs in other divisions. 
- __Company-wide:__ Amazon has lost $3B this year — after making $33B in *profits* last year. Cue: Amazon just announced a hiring freeze.

__Alexa has company…__ Numerous tech giants have resorted to radical cost cutting as the Fed’s hikes have hit rate-sensitive tech businesses hard. This week __[Meta](https://robinhood.com/stocks/META/)__ laid off 11K employees (13% of its workforce), and 330+ other techies have laid off workers this year. Others, including __[Apple](https://robinhood.com/stocks/AAPL/)__, have frozen most corporate hiring and reeled in spending (think: less $$ for R&D and moonshots).

Bad robot (Joby Sessions/Getty Images)

Alexcut

__Not all cost cuts are created equal…__ Some are easier to reverse than others, and poorly executed cost cutting can be expensive: just look at __[Twitter](https://robinhood.com/stocks/TWTR/)__, which is already trying to rehire some of the workers Elon fired just days ago. On the other hand, strategic cuts can pay off in the long run: by downsizing growth plans instead of laying off workers, companies like Amazon and __[Google](https://robinhood.com/stocks/GOOGL/)__ hope to position themselves for an easier scale-up in the next boom.

Amazon reportedly considers downsizing Alexa as tech giants scramble to cut costs

__Cuffing szn is here…__ but investors have mixed feelings about __[Bumble](https://robinhood.com/stocks/BMBL/)__. It grew sales 16% last quarter, but the pace of its swipe-driven growth is slowing. Bumble’s female-focused dating app also added a record 164K paying users last quarter, but experienced lower renewal rates on key paid subscriptions (especially with younger users). The company issued a weak forecast for this quarter as the strong US dollar hurts sales for its international dating apps like Euro-focused Badoo and [Fruitz](https://snacks.robinhood.com/newsletters/1I3jIJQkqK0ygv51yekmCQ/articles/3sQjWePKwSnxQK96KTX8T5/), which it picked up this year. 

__Post-work drinks…__ over Two-Buck Chuck. Since 2017 Bumble has nearly doubled its market share, but the brand is starting to see weaker spend from younger users on perks like unlimited swipes and extended matches. It’s a theme: this year nearly a quarter of millennials and nearly as many Gen Zers say they’ve gone into debt from splurging on dates, a recent survey [found](https://www.cnbc.com/2022/10/10/millennials-going-into-debt-from-dating-lendingtree.html). Still: 

- __Tinder owner [Match Group](https://robinhood.com/stocks/MTCH/)__ beat expectations last week thanks to its diverse portfolio of 20+ e-romance businesses, including Hinge, which last month saw record downloads.
- __But Match also warned__ that the gloomy economy was weighing on discretionary app spend and hurting Match brands that serve swipers with lower incomes.

Infla-date

__Finding a date is only half the equation…__ Inflation is forcing people to be thriftier — both with how they *find* dates and what they *spend* on dates. Nearly half of Gen Zers and millennials are having more budget-friendly meetups (think: walks, coffee dates), another survey [found](https://nypost.com/2022/11/04/infla-dating-is-making-cheap-dates-trendy/). As more singles prioritize IRL experiences over swipe sessions, $3 lattes could win over $3 extra swipes.

Bumble’s dating boom slows as zillennial users cut swipey spend (and choose cheaper dates)

- __🤔 Sus…__ After __FTX__ imploded, a WSJ source said the crypto exchange [secretly lent](https://www.wsj.com/articles/ftx-tapped-into-customer-accounts-to-fund-risky-bets-setting-up-its-downfall-11668093732?mod=hp_lead_pos5) over half its customers' funds to its sister trading firm, __Alameda Research__, forcing FTX to suspend withdrawals as customers rushed to get their money back. And…
- __🔎 Sleuthy…__ While Bahamas-based FTX crumbles, the SEC is [investigating](https://www.wsj.com/articles/sec-investigates-crypto-platform-ftx-11668020379) FTX’s separate US subsidiary. The commission is said to be looking into whether FTX.us sold unregistered securities — in addition to FTX's handling of Americans' money. 
- __📜 Policy…__ Before the FTX fiasco, lawmakers had been [working](https://www.protocol.com/fintech/crypto-lobbying-binance-ftx) with CEO Sam Bankman-Fried to shape industry-friendly crypto regulation like the Digital Commodities Consumer Protection Act. Any collab may now be toast as elected officials eye the fallout.

REKTX

The Crypto Catch-Up…

Dow Jones

S&P 500

Nasdaq

Bitcoin

About half of America’s 19M veterans are employed full time in the civilian workforce today

👄 Amazon’s Alexa ache

__The best-laid plans…__ still require due diligence. About 24 hours after the world's largest crypto exchange said it would acquire its collapsing rival, Binance said the deal to purchase FTX [was off](https://www.wsj.com/articles/binance-is-said-to-be-likely-to-walk-away-from-deal-to-buy-ftx-11668020963). One possible reason: Binance got a look at FTX's books and spotted a reported [shortfall](https://www.wsj.com/articles/binance-is-said-to-be-likely-to-walk-away-from-deal-to-buy-ftx-11668020963) of up to $8B. The about-face sent crypto markets tumbling (again):

- __Blockdrain:__ Yesterday __[bitcoin](https://robinhood.com/crypto/BTC/)__ fell under $16K to a two-year low as the fleeting hope that FTX would get bailed out dissipated. 
- __Faultcoins:__ Altcoins weren't spared from the FTX-odus. __[Ether](https://robinhood.com/crypto/ETH/)__, __[dogecoin](https://robinhood.com/crypto/DOGE/)__, and __[XRP](https://robinhood.com/crypto/XRP/)__ all dropped more than 14%.
- __It's unclear__ if (or when) FTX customers will get their money back. FYI: FTX’s US biz, which makes up 5% of its revenue, wasn't part of the planned deal. 

__Decentralized déjà vu…__ With Binance out, FTX could be on the verge of bankruptcy. Crypto followers might feel like they’ve seen this show before: over the past year, crypto lenders including Celsius have declared bankruptcy. Earlier this year FTX founder Sam Bankman-Fried (aka SBF) bailed out companies like __BlockFi__ and __Voyager__ that were felled by crypto winter. The industry once viewed SBF as its "white knight" riding in to save companies. Now SBF’s own company may need saving.

Binance CEO Changpeng Zhao takes center stage (Antonio Masiello/Getty Images)

Whiplash

__The aftershock could be bigger than the quake…__ Plunging crypto prices turn heads, but SBF's and FTX's sudden unraveling presents a larger reputational problem for crypto. The 30-year-old CEO (and political mega donor) was the face of crypto lobbying efforts on Capitol Hill. With so much regulation up in the air, FTX's implosion might sour crypto-friendly lawmakers. But if it leads to clearer US crypto regulation, it could benefit investors and ultimately fortify the industry's reputation.

Binance abandons its FTX takeover plan as crypto reels from the whiplash

__The Mario-verse is growing…__ The world’s most popular plumber is making money moves: __[Nintendo](https://robinhood.com/stocks/NTDOY/)__ [lifted](https://apnews.com/article/business-japan-shootings-education-3e4489d26cf21721fd7d58d6e80d4e64) its annual earnings forecast this week after reporting a 34% increase in quarterly profits. The Japanese gaming icon said chip shortages were still cutting into sales of its popular Switch console, but revealed Super Mario-sized plans to expand *beyond* video games:

- __Flipping a Switch:__ This week Nintendo partnered with mobile-game biz __DeNA__ to launch Nintendo Systems, a joint venture to smartphone-ize Nintendo’s console-focused biz.
- __Mario mania:__ Nintendo’s making Mario spin-offs to “build a relationship” with new fans: “The Super Mario Bros. Movie” (feat. Chris Pratt’s [funny voice](https://www.youtube.com/watch?v=iZg0yGQLSac)) debuts in April, and Super Nintendo World opens in Hollywood next year (one opened in Japan last year).

__Game Boy Advance(ing)…__ Nintendo’s expansion comes as the broader gaming industry slows: __[Roblox](https://robinhood.com/stocks/RBLX/)__ and __[Take-Two](https://robinhood.com/stocks/TTWO/)__ shares tumbled this week after both reported unexpectedly big losses. As the lockdown gaming boom fades, __[EA](https://robinhood.com/stocks/EA/)__ and others are also struggling to keep momentum. But Nintendo has a cheat code: Japan’s weak yen means Nintendo is earning *more* yen from overseas sales, after currency conversions (think: 1 USD now = more yen). __[Honda](https://robinhood.com/stocks/HMC/)__ has also benefited. It’s the *opposite* of what’s happening to US companies who do biz abroad.

Peachy

__Mario is getting the Mickey treatment…__ because IP is a terrible thing to waste. Just ask __[Disney](https://robinhood.com/stocks/DIS/)__: the House of Mouse has proved that popular characters can successfully spin off into toys, sequels, merch, theme parks, and cruises. If Nintendo succeeds in transforming the Mario-verse into a park and media empire, it might be able to offset any gaming weakness — and pave the way for a Princess Peach sequel.

From movies to theme parks, Nintendo expands its Mario-verse to boost revenue as Switch sales slow

LA just experienced record rainfall of over 1.4 inches, beating the previous record set in 1998

👋 Binance walks away from FTX

__Sam Smith remix on loop…__ a __TikTok__ loop, that is. As TikTok turns more tunes into viral hits, the world’s biggest music labels have taken note. Yesterday, Bloomberg reported that Universal Music, __[Sony Music](https://robinhood.com/stocks/SONY/)__, and __[Warner Music Group](https://robinhood.com/stocks/WMG/)__ want TikTok to pay up to 10X more in license royalties — and share its lofty ad revenue with them. And negotiation time is ticking as contracts near expiration. 

- __Trending up:__ TikTok raked in $4B in revenue last year and is on track to triple that this year as advertisers keep flocking to it. 
- __Trending down:__ Back in 2020 labels were OK receiving a flat fee for TikTok to use their extensive music catalogs. But now that it has 1B+ users — and countless music-backed videos — labels want more $$ when their artists’ songs are used.

__Running up that hill…__ As TikTok’s popularity has grown, so has its ability to turn tracks into chart-topping tunes. Now labels have started relying on the addicting app to promote new artists and singles, and with good reason:

- __HotTok:__ Last year 175+ songs that trended on TikTok charted on the Billboard Hot 100, double the number from 2020.
- __Nearly half__ of active TikTok users pay for a music subscription like __[Spotify](https://robinhood.com/stocks/SPOT/)__ or __[Apple Music](https://robinhood.com/stocks/AAPL/)__, versus just a quarter of the general population.

“Juicy” revenue opportunity (Rich Fury/Getty Images)

Looped

__Musical attention spans are shrinking...__ but music’s presence is expanding. In the ’80s, people were listening to albums beginning to end. Then single-song streaming took over, and now tracks are featured in everything from 30-second cooking clips to games like Fortnite. TikTok has modeled itself as more of a promo tool and *doesn’t* pay labels with the same revenue breakdown as Spotify or YouTube. But while TikTok needs the music industry, the industry increasingly needs TikTok.

From Sony to Universal Music, the largest record labels want a bigger cut from TikTok as the app becomes a hit-maker

__Ubering to the polling place…__ Investors didn’t cast a vote of confidence for __[Lyft](https://robinhood.com/stocks/LYFT/)__ yesterday. Shares of __[Uber’s](https://robinhood.com/stocks/UBER/)__ smaller, pinker rival tumbled 23% as investors reacted to its quarterly earnings. Lyft beat on profit expectations, but fell slightly short of Wall Street’s revenue forecast. 

- __Lyft’s #s were solid,__ but investors [expected](https://www.barrons.com/articles/lyft-earnings-disappoint-51667858128) a big beat based on Uber’s results last week — and we all know how important expectations are with investing.
- __Pricing up:__ Lyft’s revenue rose 22% from last year, to a record $1B, thanks to record *prices*. Revenue per rider surged to $52 as long trips and airport rides rebounded. 
- __Cutting down:__ Last week Lyft announced it was laying off 13% of its employees (700 people) as its net loss for the quarter quadrupled to $422M. 

__A tale of two strategies…__ Lyft’s mission is to “improve people’s lives with the world’s best transportation,” but Uber has diversified beyond urban mobility. While ride-hail majorly rebounded, Uber’s *delivery* business made up half of its gross bookings last quarter (think: Uber Eats). Its Freight biz, which connects semitruck drivers with high-volume loads, quadrupled its revenue to $1.7B. That means that Uber’s Freight division alone makes more money than Lyft as a whole.

Duopoly

__Your worst enemy is your best comparison…__ In the ride-hail duopoly, Uber and Lyft constantly compete as riders toggle between the two apps. Even though they’re two different companies, Lyft tanked as investors compared it to Uber, whose results had raised expectations for its rival. In industries with a few dominant players, the biggest competitors can’t escape these comparisons. The next frontier Uber and Lyft will be competing on: [ads](https://snacks.robinhood.com/newsletters/74zHu2wNENpA7EgJyuw9OM/articles/7aqUbrU41BN6Q7GgITCtKZ/).

Lyft shares plunge 23% as investors compare its record revenue (and growth strategy) to Uber’s

From Sony to Universal Music, record labels look to TikTok as the app becomes a hit-maker

Midterm campaign spending is expected to exceed $16.7B this year — $3B more than in 2018

🎶 Labels come for TikTok

__An iPhone under the Christmas tree…__ may be harder to come by this holiday season. __[Apple](https://robinhood.com/stocks/AAPL/)__ [warned](https://www.reuters.com/technology/foxconn-revises-down-q4-outlook-zhengzhou-covid-woes-2022-11-06/) of lower iPhone shipment volumes for the year as production snags dampen its outlook. It’s reportedly expecting to churn out at least [3M](https://www.bloomberg.com/news/articles/2022-11-07/apple-trims-new-iphone-output-by-3-million-units-as-demand-cools) *fewer* iPhone 14s than previously anticipated. The hardware heavyweight began selling its iPhone 14 line in September, but sales have swiftly cooled. Two reasons: 

- __Underwhelming demand:__ Consumers aren’t splurging as much on fancy gadgets, which explains weaker demand for Apple’s pricey Pro offerings. Last month Apple reported record quarterly sales, but iPhone revenue was softer than expected. 
- __Overwhelming rules:__ China’s zero-Covid policy has [messed with](https://www.reuters.com/technology/foxconn-revises-down-q4-outlook-zhengzhou-covid-woes-2022-11-06/) Apple’s production this year. The latest snafu: the main iPhone assembly site, in Zhengzhou (aka: “iPhone City”), is under a weeklong Covid shutdown. Apple said customers should expect longer wait times. 

__Everybody talks…__ Last week there were rumors flying about when China would end its strict Covid restrictions (think: [locking visitors](https://www.cbsnews.com/news/shanghai-disneyland-closed-covid-china-visitors-locked-in-park-for-testing/) inside __[Disneyland](https://robinhood.com/stocks/DIS/)__). Chinese stocks surged on speculation that authorities could lift some measures earlier than expected. The rumor mill may’ve boosted some US stocks, too, since so much production depends on China. Now investors aren’t so optimistic: on Sunday China reported its highest # of new Covid infections in six months (4.4K). Chinese health officials said they would stick with their strategy.

iMessage from Santa: “I might be late” (George Frey/Getty images)

Unboxed

__No one puts China in a corner…__ except maybe China. The world’s second-largest economy is putting blockers in front of its own growth, and fourth-quarter GDP is already hitting [speed bumps](https://www.reuters.com/world/china/chinas-q4-gdp-hits-early-speed-bump-covid-stifles-economy-2022-10-25/) as Covid rules depress demand and productivity. But the US and corporate titans like Apple can’t just brush that off as a “China problem.” Since the US imports more from China than any other country, it’s an *everyone* problem — that only China can tackle.

iPhone production is expected to take a holiday hit as China’s Covid rules continue to mess with supply

__Backup plan = beer...__ Cannabis companies have been waiting for US federal regulators to legalize marijuana, and now they’re having a (few) drinks while they bide their time. Yesterday Canadian cannabis giant __[Tilray](https://robinhood.com/stocks/TLRY/)__ [bought](https://www.globenewswire.com/news-release/2022/11/07/2549865/0/en/Tilray-Brands-Acquires-Montauk-Brewing-Company.html) NYC’s top craft brewer __Montauk Brewing Co.__. 

- __Big swigs:__ Montauk is sold in 6K+ stores, including __[Target](https://robinhood.com/stocks/TGT/)__, Whole Foods, Trader Joe's, __[Costco](https://robinhood.com/stocks/COST/)__, and __[Walmart](https://robinhood.com/stocks/WMT/)__. It joins beer maker SweetWater and bourbon brand Breckenridge Distillery in Tilray’s growing beverage portfolio.
- __Two cans with one stone:__ Tilray said the purchase would boost profitability. But it serves another purpose: Tilray plans to leverage Montauk’s US distribution network (and customers) to start selling canna-beverages nationwide as soon as they’re legal.

__Stuck in the weeds…__ Recreational cannabis is legal in 19 states and DC — and five more states are voting *today* on whether to greenlight it. But since cannabis still isn't *federally* legal, many canna-companies are struggling to build national distribution networks. 

- __Impatient partners:__ Bud brewer __[AB-InBev](https://robinhood.com/stocks/BUD/)__ ended a two-year partnership with Tilray this year after waiting for legalization. Meanwhile, drink giants __[Constellation](https://robinhood.com/stocks/STZ/)__ and __PBR__ have launched their own canna-beverages in smaller markets.
- __Placeholder products:__ Pot rival __[Canopy Growth](https://robinhood.com/stocks/CGC/)__ has launched non-cannabis lines, like a skincare biz and sports-drink brand, to prep for legalization (think: eventually infusing moisturizer with CBD).

__The star player is on the sidelines…__ While Tilray, __[Aurora Cannabis](https://robinhood.com/stocks/ACB/)__, and Canopy posted overall losses last quarter, Tilray’s smaller non-canna brands are already profitable — and Tilray expects positive cash flow by the end of the year (FYI: Aurora reports Thursday). But the cannabis industry’s main attraction (cough, cannabis) could spur rapid growth when it gets in the game: the market is forecast to grow from roughly $1B last year to $19B by 2028.

Cannabis giant Tilray bets big on boozy beverages as it waits for broad US legalization

*⚾ When Little League underdogs take on Major League players…*

Crypto winter has hit hard, with bitcoin down 56% this year. But analysts (and crypto __[Twitter](https://robinhood.com/stocks/TWTR/)__) are starting to whisper about a possible "alt szn" as altcoins like __[dogecoin](https://robinhood.com/crypto/DOGE/)__ and __[matic](https://robinhood.com/crypto/MATIC/)__ have seen outsized gains relative to BTC over the past month. Possibly boosting alts: Elon Musk and Instagram NFTs.

DEFI(NE)

Heard on the Block: “alt season”

Apple's iPhone production is expected to take a holiday hit as China’s Covid curbs continue

For the first time, lab-grown blood has been transfused into humans

🎄 iPhone’s sad holiday

__Buying a cherry-red smile…__ but the outlook is more matte than glossy. Beauty titans are often shielded during economic downturns thanks to the so-called lipstick effect. In gloomy times, cash-stressed consumers can’t afford big-ticket items, so they console themselves by indulging in small luxuries (think: $38 Dior Lip Glow). 

- __$20 gloss > $200 hydrafacial:__ As the US economy shrank in the first quarter, lipstick sales jumped 48% from last year (2X as fast as other beauty products). 
- __Lip*stuck*:__ But now even cosmetics giants are [struggling](https://www.bloomberg.com/news/articles/2022-10-29/-lipstick-effect-starts-fading-for-consumer-beauty-groups?sref=q3KSFp38) to cover up ugly economic effects. 

__Losing luster…__ Last week __[Estée Lauder](https://robinhood.com/stocks/EL/)__ said its quarterly makeup sales fell 10%, and it lowered its outlook on weakening demand. Rival __L’Oréal__ reported slowing growth as its profit-puppy luxe division (think: __[Prada](https://robinhood.com/stocks/PRDSY/)__, Lancôme) underperformed. FYI: Cover Girl owner __[Coty](https://robinhood.com/stocks/COTY/)__ reports next week. But while consumers are cutting back on makeup, spending *rose* more than expected in September as Americans splurged on “experiential” indulgences. 

- __Travel go-tos__ are booming. __[Airbnb](https://robinhood.com/stocks/ABNB/)__ reported its best quarter ever last week while __[Marriott](https://robinhood.com/stocks/MAR/)__ joined __[Hilton](https://robinhood.com/stocks/HLT/)__ in lifting its annual forecast. __[Booking’s](https://robinhood.com/stocks/BKNG/)__ profit more than doubled. 
- __Chains__ including Burger King, __[Starbucks](https://robinhood.com/stocks/SBUX/)__, and KFC and Taco Bell owner __[Yum Brands](https://robinhood.com/stocks/YUM/)__ had robust sales growth as Americans opened their wallets for premium items like PSLs. 
- __Big food staples__ like __[Kellogg](https://robinhood.com/stocks/K/)__, __[Pepsi](https://robinhood.com/stocks/PEP/)__, and __[Kraft](https://robinhood.com/stocks/KHC/)__ have reported strong sales this season as consumers kept stocking Frosted Flakes and Cheetos despite price hikes. Booze big shots like Smirnoff maker __[Diageo](https://robinhood.com/stocks/DEO/)__ have also proved resilient.

Passing on the $30 lip glow (Budrul Chukrut/Getty Images)

Ungloss

__Consumers are in “bite or flight” mode…__ While the economy's in stressful fight-or-flight mode, some Americans are finding solace by indulging in brand-name treats (bites) or getaways (flights). Despite broad price hikes, a lot of consumers are still shelling out for Whoppers and Airbnb glamping weekends. We might need to kiss the lipstick effect goodbye, because the seemingly “protected” categories during this downturn appear to be experience-based.

The “lipstick effect” is fading for cosmetics giants as consumers find comfort in experiential splurges

__A whole new world…__ While streaming entertainment powered __[Disney](https://robinhood.com/stocks/DIS/)__ through the pandemic, real-life entertainment is propelling growth now. Revenue for the first nine months of the year was up 28% as US parks and resorts recovered and is expected to be up 25% for the year (Disney reports tomorrow). With Disney+, Hulu, and ESPN+, Disney surpassed __[Netflix’s](https://robinhood.com/stocks/NFLX/)__ total subs in August but lowered its 2024 forecast for Disney+ as growth slows. If the streamer hadn’t added 9M subs last quarter, as expected, investors might be bummed despite Disney's strong overall growth. 

__Insert (more) coins to continue...__ Gaming behemoths are struggling to beat their own high scores as the pandemic video-game boom slows. In the second quarter, NBA 2K maker __[Take-Two Interactive](https://robinhood.com/stocks/TTWO/)__ and tween fave __[Roblox](https://robinhood.com/stocks/RBLX/)__ fell short of quarterly earnings expectations after reporting fewer new gamers. Meanwhile, __[Microsoft’s](https://robinhood.com/stocks/MSFT/)__ $70B purchase of __[Activision](https://robinhood.com/stocks/ATVI/)__ — which makes Call of Duty — remains stalled in a lengthy regulatory review. Analysts expect earnings to keep falling when Take-Two and Roblox report this week, but revenues are forecast to rise as in-game spending stays strong.

Events

Coming up this week...

__“The future of [Twitter](https://robinhood.com/stocks/TWTR/)”…__ Every Twitter thread last week. ICYMI: Elon Musk now runs Twitter (in his [words](https://www.ft.com/content/b0b49bc2-9d6e-4e0d-8962-a0f60185947c): “the bird is freed”). Top execs have left the company and advertisers are [skittish](https://www.nytimes.com/2022/11/01/technology/elon-musk-twitter-advertisers.html). After __[GM](https://robinhood.com/stocks/GM/)__ paused Twitter campaigns, ad giant __[IPG](https://robinhood.com/stocks/IPG/)__ recommended its clients pause their spend too. Meanwhile, Elon seems focused on cutting costs and boosting *non*-ad revenue: On Friday, Twitter laid off half its employees, and over the weekend started rolling out an $8/month charge for blue check marks. There are *many* opinions about the Twitter-quisition, but only time will tell if it’ll help the embattled platform rise or [sink](https://twitter.com/elonmusk/status/1585341984679469056). 

__Giving mixed signals…__ US employers added 261K jobs in October, and there are roughly two open jobs for every unemployed worker (a sign the Fed’s hikes aren’t cooling the economy enough). But job growth slowed and unemployment ticked up to 3.7%. Microsoft, Netflix, __[Snap](https://robinhood.com/stocks/SNAP/)__, and __[Meta](https://robinhood.com/stocks/META/)__ are laying off employees, and __[Amazon](https://robinhood.com/stocks/AMZN/)__ and (reportedly) __[Apple](https://robinhood.com/stocks/AAPL/)__ have frozen corporate hiring. Last week __[Lyft](https://robinhood.com/stocks/LYFT/)__ and __Stripe__ also announced cuts. Non-tech industries may also slow: last week __[Ford](https://robinhood.com/stocks/F/)__ offered buyouts to underperformers.

Zoom Out

Stories we’re watching...

- __[#Phygital](https://snacks.robinhood.com/newsletters/1ynCBzQDGgEJsiGkLyJv9w/articles/1Xt7kCVMDfQvV1HNDwCAk8/):__ __[Ralph Lauren](https://robinhood.com/stocks/RL/)__ and Epic Games announced a Fortnite fashion collection. The collab is *both* physical and digital, living in closets and in Fortnite avatars. It could help the preppy retailer gain younger fans.
- __[BnBest](https://snacks.robinhood.com/newsletters/4AlGzt3G5mcKHojU0cyOhI/articles/6S5Z7Rvu6WBZMnP9acC1PJ/):__ Airbnb is on top of the world (and can maybe rent you a yurt there). By embracing WFH trends, the rental platform posted its best quarter as consumers seek IRL experiences in an always-online world. 
- __[Scored](https://snacks.robinhood.com/newsletters/18Ma3zsD9SAGoOFKeiDGMH/articles/6jMEWWVI423VNgMxo70CFX/):__ __[Dick’s Sporting Goods](https://robinhood.com/stocks/DKS/)__ launched a $50M venture-capital fund to invest in sports-related startups. Corporate VC is booming, with companies from __[Google](https://robinhood.com/stocks/GOOGL/)__ to __[GE](https://robinhood.com/stocks/GE/)__ to __[J&J](https://robinhood.com/stocks/JNJ/)__ building major funds.

ICYMI

Last week's highlights...

The “lipstick effect” fades for cosmetics giants as consumers find comfort in experiences

The first country to give women the right to vote was New Zealand in 1893

💄 The new “lipstick effect”

__From soccer cleats to term sheets…__ __[Dick’s Sporting Goods](https://robinhood.com/stocks/DKS/)__ just joined the big leagues of a new sport: venture capital. Yesterday the retailer [launched](https://www.bloomberg.com/news/articles/2022-11-03/dick-s-sporting-goods-dks-starts-50-million-venture-capital-fund) a $50M VC fund called DSG Ventures. Dick’s plans to use the in-house fund to invest in new sports products and tech.

- __The first investment round__ includes women’s-sneaker brand __Moolah Kicks__, sports-gear marketplace __SidelineSwap__, and youth sports biz __EL1 Sports__.
- __#SportsSynergy:__ DSG Ventures plans to also offer *non*-financial support, like distribution through Dick’s stores — a win for both Dick’s *and* the startups it invests in.

__Everyone’s a (venture) capitalist…__ An old-school sporting-goods chain might seem like an unlikely source of VC funding, but corporate venture capital (aka: CVC) has a long history. Chemical giant __[DuPont](https://robinhood.com/stocks/DD/)__ became the first big CVC when it invested in fledgling automaker __[General Motors](https://robinhood.com/stocks/GM/)__ in 1917. 

- __Very big:__ Since then, titans like __[Google](https://robinhood.com/stocks/GOOGL/)__, __[Intel](https://robinhood.com/stocks/INTC/)__, __[GE](https://robinhood.com/stocks/GE/)__, and __[J&J](https://robinhood.com/stocks/JNJ/)__ have become major CVC players. In 2020, CVCs invested more than $70B — a quarter of all VC funding that year.
- __Very varied:__ Corporate VC arms exist across lots of industries, including construction (__[Caterpillar](https://robinhood.com/stocks/CAT/)__), convenience (__[7-Eleven](https://robinhood.com/stocks/SVNDY/)__), travel (__[United Airlines](https://robinhood.com/stocks/UAL/)__), and meat (__[Tyson](https://robinhood.com/stocks/TSN/)__). This year even crypto exchange __FTX__ launched a $2B VC fund.

Kayaking to the pitch meeting (Craig Warga/Getty Images)

__VC can act as discounted R&D…__ Instead of spending big to develop new products and tech, corporations can invest in smaller companies that’ve already created them. That could yield financial benefits like IPO returns and strategic wins like product partnerships. __[General Mills’](https://robinhood.com/stocks/GIS/)__ VC arm helped launch __[Beyond Meat](https://robinhood.com/stocks/BYND/)__, and Google Ventures backed __[GitLab](https://robinhood.com/stocks/GTLB/)__, Slack, __[DocuSign](https://robinhood.com/stocks/DOCU/)__, and __[Toast](https://robinhood.com/stocks/TOST/)__. Dick’s hopes to do the same with sporting goods, but it’ll be up against __[Nike](https://robinhood.com/stocks/NKE/)__, __[Adidas](https://robinhood.com/stocks/ADDYY/)__, and __[Under Armour](https://robinhood.com/stocks/UA/)__ — all of which have VC divisions.

Dick’s Sporting Goods debuts a $50M fund as the VC-fication of corporate America continues

__Decentralized pain…__ Crypto financial services firm __Galaxy Digital__ is [reportedly](https://www.bloomberg.com/news/articles/2022-11-01/novogratz-s-galaxy-digital-explores-workforce-cuts-of-about-20) considering cutting one-fifth of its staff as crypto winter's freeze sets in. Galaxy is seen as a bellwether for the industry because its business services __[bitcoin](https://robinhood.com/crypto/BTC/)__ miners and crypto traders, and it invests in blockchain projects like __[polygon](https://robinhood.com/crypto/MATIC/)__. Galaxy's not alone in its cuts:

- __Bit-axed:__ This week, crypto exchange __BitMex__ announced layoffs of up to 30%.
- __Sadder:__ Web3 studio __Dapper Labs__ said it's cutting 22% of its 600-person team.
- __DCGone:__ Crypto conglomerate (and CoinDesk parent) __DCG__ laid off 10% of staff.

__Misery loves coin-pany…__ and this party's crowded. It's not just *crypto* fintechs feeling the squeeze of record inflation and spiking interest rates. __Stripe__ announced yesterday that it'll lay off 14% of its workforce. Layoffs are often *forward*-looking — a sign that companies expect more slowing growth or falling earnings. This week the cofounder of __[Tezos](https://robinhood.com/crypto/XTZ/)__, a proof-of-stake blockchain, said crypto winter is "only going to get worse." More cost cuts could be coming. 

DeFi

__The future of finance is still tied to the present…__ Crypto companies want to revolutionize the financial system with decentralized finance (DeFi). In the meantime, those companies are still accountable to investors, boardrooms, and centralized finance (CeFi) realities. Since crypto is still viewed by many primarily as an *investment* opportunity (*not* a transactional currency), the industry has to deal with today's rising interest-rate reality that’s dampened demand.

Crypto firms like Galaxy Digital eye layoffs as DeFi dreams struggle with CeFi realities

- __🖼️ Showy…__ Instagram's got the NFT bug. The __[Meta](https://robinhood.com/stocks/META/)__-owned platform said some users can now [mint](https://www.coindesk.com/web3/2022/11/02/instagram-users-will-soon-be-able-to-mint-and-sell-nfts/) and sell NFTs. But Meta didn't launch its own blockchain — at least to start, any selfie NFTs will live on polygon. 
- __📸 Flashy…__ Hello, 401(k)rypto? A [survey](https://www.cnbc.com/2022/11/01/schwab-nearly-half-of-gen-z-and-millennials-want-crypto-in-401ks.html) of millennials and Gen Zers with 401(k)s found nearly half wish they could incorporate crypto into their retirement account. __[Fidelity](https://robinhood.com/stocks/FNF/)__ moved to include bitcoin in some 401(k)s this year. 
- __🤖 Techy…__ __[Twitter](https://robinhood.com/stocks/TWTR/)__ may be crypto's social home, but __Kraken's__ vying for real estate. A subsidiary of the crypto exchange [launched](https://www.protocol.com/bulletins/kraken-cryptowatch-social) a new platform dubbed Cryptowatch Social. Think: BTC price charts with built-in viral sharing.

Social

Dick’s Sporting Goods debuts a $50M fund as corporate America’s VC-fication continues

Yesterday Apple was worth more than Google, Amazon, and Meta combined

💸 Corporate America’s VC-fication

__Weekend in the treehouse yurt…__ __[Airbnb](https://robinhood.com/stocks/ABNB/)__ has doubled down on quirky lodging like tiny homes, desert RVs, and castles. That focus on “experiential” stays appears to be paying off: the rental platform posted its [best](https://skift.com/2022/11/01/airbnb-posts-best-quarter-yet-on-relentless-travel-demand/) quarter ever as travel demand stays hot. 

- __Record revenue *and* profit:__ Sales spiked thanks to a record 90M guest arrivals and 100M “nights and experiences” booked. Earnings surged 46% from last year to $1.2B. 
- __Yet:__ Airbnb shares have fallen 13% since it reported Tuesday, after it issued slightly lower-than-expected guidance for this holiday quarter. 

__Zooming in from a Portuguese windmill…__ If there’s WiFi, *how would they know?* These latest numbers show that Airbnb continues to be one of the best pandemic comeback stories. Airbnb’s biz was crushed when the pandemic hit, but it quickly embraced the WFH life and revamped its platform to complement changing travel trends. It’s using the new norm of flexible work to its advantage: 

- __CEO Brian Chesky__ said that despite return-to-office requirements, 20% of Airbnb’s total nights booked remain long-term stays (think: a month or longer). 
- __Wow-worthy stays:__ Last month, Airbnb made a $10M [investment](https://www.fastcompany.com/90795952/airbnb-just-invested-10-million-in-100-absurd-buildings) to build 100 absurd accommodations, from a floating avocado abode to a giant cheese wedge.

Sea suite (Chesnot/Getty Images)

Yurt

__Real-life experiences are rarer than ever…__ In a society where socializing means chatting online and shopping means browsing the web, IRL experiences have newfound value. Chesky said: “Because the mall is now __[Amazon](https://robinhood.com/stocks/AMZN/)__, the movie theater is now __[Netflix](https://robinhood.com/stocks/NFLX/)__, people still want to get out of the house.” While consumers are cutting back in some areas, they’re still splurging on experiences. Yesterday, Kayak owner __[Booking](https://robinhood.com/stocks/BKNG/)__ reported that quarterly profit more than doubled from last year as travel bookings surged. Airbnb rival __[Vacasa](https://robinhood.com/stocks/VCSA/)__ is set to report next week.

Comeback kid Airbnb has its best quarter ever as IRL experiences become a rare commodity

__8 MVPs, 1 pop star…__ Tiger Woods’ latest venture has a [stacked](https://www.cnbc.com/2022/11/02/serena-williams-justin-timberlake-invest-in-tiger-woods-new-venture.html) roster of A-list investors. In August, Woods and fellow pro golfer Rory McIlroy launched __TMRW Sports__, a biz aimed at techifying sports entertainment. Yesterday we learned that Steph Curry, Serena Williams, F1 champ Lewis Hamilton, and Justin Timberlake are among TMRW’s newest backers. One of TMRW's first ventures is a new golf league — and it’s teeing up big buzz.

- __[Topgolf](https://robinhood.com/stocks/MODG/) for the pros:__ Starting in 2024, six teams of three PGA players will compete in 18-hole matches at a custom tech-infused arena ([think](https://twitter.com/TGL/status/1562483830933450753?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1562483830933450753%7Ctwgr%5E579878cb09c39c76bcd610454511f0c56f6059a6%7Ctwcon%5Es1_&ref_url=https%3A%2F%2Fwww.sportingnews.com%2Fus%2Fgolf%2Fnews%2Ftgl-tiger-woods-rory-mcilroy-new-golf-league-explained%2Fjgniybbnu6yzndakyxlmlbay): a stadium-size golf simulator).
- __FYI:__ Last year golf-related sales boomed thanks to the sport’s socially distant popularity, with brands like Callaway and Titleist notching record earnings.

__Not your dad’s golf channel…__ Golf is gaining entertainment value as big players drive innovation. TMRW’s launch comes as the new Saudi-backed LIV Golf tour [lures](https://snacks.robinhood.com/newsletters/2n1tfbP2sL0dLHd6d2tSbw/) PGA players and fans with bigger prizes, looser schedules, and flashy festival-style tournaments. Meanwhile, Callaway-owned Topgolf's party-style atmosphere and accessible simulator tech have lured Zillennials (over half of its visitors have never played golf before).

Swing

__Big players can change the game…__ because often they *are* the game. Tiger and his celeb-vestors want to use features like real-time stats and indoor arenas to attract younger fans and families to the old sport. Down the road, TMRW wants to expand into sports beyond golf. Meanwhile, soccer superstar Lionel Messi recently launched his own firm to invest in sports, media, and tech. 

From Serena Williams to Steph Curry, stars are backing Tiger Woods' venture to techify sports entertainment

Airbnb has its best quarter ever as IRL experiences become a rare commodity

Google searches for realistic excuses to skip work hit 2M this year, up from 300K in 2018

🏰 Airbnb’s king-size quarter

__Old money, new digs…__ __[Ralph Lauren’s](https://robinhood.com/stocks/RL/)__ iconic horsey jockey is now riding a cartoon llama. Ralph Lauren and __Epic Games’__ Fortnite are [teaming up](https://www.bloomberg.com/news/articles/2022-10-31/ralph-lauren-rl-launching-polo-fortnite-fashion-line-with-new-llama-logo?srnd=premium&sref=q3KSFp38) on a physical and digital (#phygital) fashion line. The physical Polo Stadium Collection launches today on RL’s site (think: ’90s-themed polos and $70 hoodies). On Saturday, the digital collection is expected to hit Fortnite with avatar outfits priced about $6. Both collections feature Polo’s first redesigned logo (feat. Fortnite llama). 

- __For RL:__ With sales relatively flat over the past decade, the old-school retailer plans to raise prices and focus on new customers for growth. The prep star hopes to tap into Fortnite’s 400M users.
- __For Fortnite:__ As gamers splurged on “Spider-Man” skins and accessories, Fortnite's “V-Bucks” virtual currency helped drive sales last year to a record $5.8B. Brand partnerships could help supercharge growth. 

__Pop the collar (in the metaverse)…__ Ralph Lauren is the latest fashion house to partner with popular online platforms as brands look to capitalize on digi-fashion. Last year Balenciaga became the first major fashion brand to launch a phygital collection with Fortnite (see: [$725](https://www.cnet.com/culture/fashion/show-off-how-much-of-a-fortnite-fan-you-are-with-725-balenciaga-hoodie/) hoodies). Meanwhile, Ralph Lauren made its digital fashion debut with “Polo Shops” in __[Roblox](https://robinhood.com/stocks/RBLX/)__, which let players purchase digi-clothing for their avatars.

Welcome to the Poloverse (Courtesy of Ralph Lauren)

Llama

__Retailers are bridging the “phygital” gap…__ Virtual-apparel collabs with brands like __[Disney's](https://robinhood.com/stocks/DIS/)__ Marvel, the NFL, and __[Nike](https://robinhood.com/stocks/NKE/)__ have already earned tens of millions of dollars for Fortnite. The metaverse allows traditional retailers like Ralph Lauren to reinvent their brands for a fresh audience. The times they are a-changin’: online transactions now make up a quarter of RL’s sales and could reach 33% in the next few years thanks to younger shoppers.

Ralph Lauren launches a Fortnite fashion collab as retailers turn to “phygital” partnerships to lure younger shoppers

![NurPhoto/Getty Images](//images.ctfassets.net/mwphzyq69oso/6N6rPGaxsikzmZYGccSBzY/10cbedae9d7dd718d48e48f54700ab56/GettyImages-1236646723.jpg)

__Not everyone’s pumped…__ Oil profits are booming and President Biden isn’t pleased. This week oil giants __[Chevron](https://robinhood.com/stocks/CVX/)__, __[BP](https://robinhood.com/stocks/BP/)__, __Saudi Aramco__, __[Marathon Petroleum](https://robinhood.com/stocks/MPC/)__, and __[Phillips 66](https://robinhood.com/stocks/PSX/)__ posted jaw-dropping profits thanks to rising prices. __[Exxon](https://robinhood.com/stocks/XOM/)__ tripled its quarterly profit to a record. Though gas prices have fallen from summer peaks, they’re still much higher than when Biden took office. 

- __Harsh words:__ This week Biden [accused](https://www.nytimes.com/2022/10/31/us/politics/biden-oil-windfall-tax.html) gas titans of “profiteering” off Russia’s war on Ukraine and threatened them with a windfall tax (a one-time tax on excess profits).
- __Empty promises:__ Only Congress (which won’t be in session till January) can pass a new tax. Plus, analysts expect Congress to remain divided after next week’s midterms.

__You don’t need a meteorologist…__ to know which way the windfall blows. Biden’s not the only one monitoring oil profits: lawmakers in Greece, Hungary, Italy, Romania, Spain, and the UK have implemented windfall taxes. But some investors are seeing the glass as half full:

- __Buffett’s gas:__ In recent months Warren Buffett’s __[Berkshire Hathaway](https://robinhood.com/stocks/BRK.A)__ has boosted its massive stake in Chevron and __[Occidental](https://robinhood.com/stocks/OXY/)__, making oil one of its largest investments. Berkshire has gained $13B on those holdings in the past few years.

Slick

__You can’t fill a Camry with stock buybacks…__ but oil execs insist they’re returning their profits to Americans through stock dividends and share buybacks — and say taxes could cut into investors’ returns. Oil giants Chevron, BP, Exxon Mobil, __[Shell](https://robinhood.com/stocks/SHEL/)__, and __[TotalEnergies](https://robinhood.com/stocks/TTE/)__ spent $20B+ on buybacks in the first half of this year and are expected to splurge more in the second half. Their shares have risen an average of 37% this year, while the S&P 500 has fallen 20%.

Oil profits keep gushing as high prices stick, drawing criticism from Biden ahead of midterms

Ralph Lauren launches a Fortnite fashion collab as retailers turn to “phygital” partnerships

Songs from Taylor Swift's new album held all top 10 spots on the Billboard Hot 100 yesterday

👕 Fortnite’s fashion Poloverse

__Chuck your checkbook…__ Rent payments are entering the 21st century. Yesterday __[JPMorgan Chase](https://robinhood.com/stocks/JPM/)__ [said](https://www.cnbc.com/2022/10/31/jpmorgan-chase-unveils-payments-platform-for-landlords-and-tenants.html) it's testing a digital platform called “Story” to automate rent payments, which are still often paid by check. Here’s how it’s supposed to work: 

- __Renter center:__ Story will let renters enroll in auto-pay programs, get notifications, and view their payment history online. 
- __Owner dashboard:__ Story will allow landlords to view payments across their properties, use analytics to set prices, and screen prospective tenants.

__Rent tech is stuck in the dark ages…__ Today, 78% of US renters pay their rent by check — a paper technology that’s been used since the 1400s. One reason: most of America’s 12M landlords have relatively few units and collect payment just once a month, so they haven’t needed fancy systems. Now startups and banks are pushing for techier tools:

- __Rent rewards:__ __Bilt Rewards__, which offers a credit card in partnership with __[Mastercard](https://robinhood.com/stocks/MA/)__ and __[Wells Fargo](https://robinhood.com/stocks/WFC/)__, lets users earn rewards points by paying rent on time and then use those points to pay for travel, __[Amazon](https://robinhood.com/stocks/AMZN/)__ purchases, or even homes. 
- __Big bucks:__ This month Bilt raised $150M at a $1.5B valuation, and rent-tech startups __Esusu__, __Stake__, and __Piñata__ have also raised millions for rent-rewards programs.

Tap to pay rent? (Drew Angerer/Getty Images)

Checked

__Banks are betting big on boring…__ Banking big shots like JPMorgan and __[Goldman Sachs](https://robinhood.com/stocks/GS/)__ are investing in more consistent revenue streams like specialty consumer loans and co-branded cards to offset volatility in their investment-banking and trading divisions — and rental payments are as consistent as it gets (though less exciting than IPOs). JPM is already the biggest lender to US landlords; now it aims to snag a chunk of the $500B/year that Americans spend on rent.

Chase launches a techy rent-payment platform to boost reliable revenue (minus the checks)

__Venmo requesting JPowell…__ Everyday folks are struggling with higher interest rates, from mortgages to hefty credit-card payments. But Jack and Jill aren’t the only ones: central banks are [suffering](https://www.wsj.com/articles/higher-interest-rates-fuel-losses-at-the-federal-reserve-11667208602?mod=pls_whats_news_us_business_f) from their own medicine. 

- __The Fed’s losing money —__ something it’s never consistently done before. That’s partly because it now has to pay *higher* interest to banks for depositing money at the Fed (think: reserves and overnight loans). 
- __Losses are piling up:__ The Fed’s interest payouts now exceed the $8T+ that it earns on Treasury bonds and other securities. FYI: in recent years, it earned about $100B in *profit*, which is sent to the Treasury to reduce federal deficits. 
- __Not just the US:__ Central banks worldwide are dealing with the fallout of their inflation-fighting rate hikes, which don’t seem likely to slow anytime soon. Eurozone inflation just [hit](https://www.cnbc.com/2022/10/31/euro-zone-inflation-hits-10point7percent-in-october-.html) a record 10.7%. 

__The name’s bond…__ Higher interest payments on bank deposits aren’t the only problem. The bond market is experiencing its worst selloff in a generation. As rates rise, the value of existing bonds falls. People are selling old bonds as new ones are issued at higher rates. 

- __That’s bad for the Fed and other central banks__ that racked up huge bond portfolios to help stimulate their pandemic economies (bond-buying = more cash in circulation). 
- __As bond prices plunge,__ banks are watching the value of those holding plummet. The central banks of Australia, Switzerland, and the Netherlands are already [seeing red](https://www.bloomberg.com/news/articles/2022-10-25/fed-is-losing-billions-wiping-out-profits-that-funded-spending). Global government-bond losses are on track for the worst year since 1949.

__Pressure might not “break” the bank…__ but enough political backlash might make it adjust course. While losses don’t hamper central banks’ ability to conduct monetary policy (aka: do their job), they’re drawing concern from politicians. Without income from the Fed, the Treasury needs to borrow more to fund government spending. Now, calls are growing to slash the interest payments that central banks make to commercial banks.

Central banks are losing money as interest rates roar, swallowing their own bitter pill

*🛹 If the “How do you do, fellow kids” meme were a crypto…*

Creators like Satoshi Nakamoto and companies including __Circle__ have launched cryptocurrencies. Now central banks want in on the fun with a digital currency they can issue and control (aka: a “__central bank digital currency__,” or CBDC). India's central bank plans to start its [CBDC](https://www.coindesk.com/policy/2022/10/31/indias-central-bank-to-start-wholesale-cbdc-pilot-nov-1/) pilot today, and the US Fed is “exploring” CBDCs.

Heard on the Block: “CBDC”

US apartment demand has fallen to its lowest level in 13 years

💸 JPMorgan’s rent revolution

__Memes become Monet paintings…__ A new kind of AI is transforming the way people create art *and* do business. Generative AI uses deep learning and tons of data to convert text prompts into images, videos, and articles. We made the image above using gen-AI and a text prompt. 

- __Main character:__ __OpenAI__, which has raised billions from __[Microsoft](https://robinhood.com/stocks/MSFT/)__ and others, launched the first major gen-AI tool, Dall-E, last year. It was released to the public last month, and __Reddit’s__ already filled with viral Dall-E [creations](https://www.reddit.com/r/weirddalle/comments/xjf1vh/an_italian_sink_with_a_tap_that_dispenses/).
- __Other players:__ __Stability AI__ raised $100M this month (at a $1B+ valuation) for its open-source gen-AI tool, Stable Diffusion. __[Meta](https://robinhood.com/stocks/META/)__, __[Google](https://robinhood.com/stocks/GOOGL/)__, __[Salesforce](https://robinhood.com/stocks/CRM/)__, and __[Adobe](https://robinhood.com/stocks/ADBE/)__ have built in-house gen-AIs, too, but they’re not publicly available.

__Goofy images were only the start…__ Now entrepreneurs are putting gen-AI to work. 140+ gen-AI startups have launched in recent months: __Jasper__, which makes AI-generated blog posts, raised $125M at a $1.5B valuation last week. Companies can use it to automate copywriting (think: “a promotional post about air fryers in a friendly tone”). Other startups are auto-generating clothes, floorplans, and ad jingles. Microsoft added Dall-E to its design tools, and __[Shutterstock](https://robinhood.com/stocks/SSTK/)__ plans to use it to make stock images. But ethical concerns abound:

- __Payment problems:__ Critics say gen-AI doesn’t compensate artists who create the content that “feeds” its algorithms (though Shutterstock has a “contributor” fund).
- __Harassment hitches:__ Dall-E has safeguards, but some argue that gen-AI can still be used to produce celeb deepfakes and misinfo. Others say it replicates biases, like sexist imagery.
- __Automation anxiety:__ Some fear gen-AI will put writers and designers out of work (others disagree).

We generated this image using DALL-E and the prompt “an oil portrait of a Shiba Inu wearing a business suit and holding an iPhone, in the style of Claude Monet.”

Creative

__Highly visible = highly valuable…__ AI has many existing applications (think: self-driving cars, disease diagnosis, fraud protection),but it often operates behind the scenes. And yet generative AI has an accessible wow factor that’s already dazzled many. Some investors say it’ll be a huge industry: prominent VC firm __Sequoia__ predicted that gen-AI could generate “trillions in value” and revolutionize industries that require humans to create original work.

“Generative AI” is booming, and it’s revolutionizing the way people make art — and money

__Dressed up as Jerome Powell…__ because interest rates are terrifying. To be the Fed chair all you need are hiking clothes: America’s central bank is expected to raise rates by a “jumbo” 75 basis points on Wednesday — the fourth straight bump of that size. Soaring borrowing costs are spooking investors and raising recession red flags. Last week mortgage rates topped 7% for the first time in 20 years. But economists polled by Reuters said the Fed shouldn’t pause its hiking crusade till inflation drops to around half of its current level (a hot 8.2%).

__Winter’s coming…__ While consumers are still feeling #PumpAnxiety, oil giants are still pumping [record](https://www.usnews.com/news/business/articles/2022-10-28/oil-giant-exxon-rakes-in-a-record-19-66b-in-profits) profits. Last week __[Exxon](https://robinhood.com/stocks/XOM/)__, __[Chevron](https://robinhood.com/stocks/CVX/)__, and __[Total](https://robinhood.com/stocks/TTE/)__ demolished earnings with record results (Exxon took home a $20B profit). Analysts expect __[Marathon Petroleum](https://robinhood.com/stocks/MPC/)__ and __[ConocoPhillips](https://robinhood.com/stocks/COP/)__ to deliver strong results when they report this week. Global oil and gas supplies are still tight from pandemic-era output cuts and the war in Ukraine. Now President Biden is urging Big Oil to boost production (and cut buybacks) ahead of winter.

__Well, that was underwhelming…__ Tech stocks plunged last week after uninspiring third-quarter earnings. Google’s sales growth slowed big-time as ad spending sagged, while Meta’s revenue dropped for a second straight quarter (and profit plunged 52%). What really turned investors off: weak *forecasts* for this holiday quarter. __[Amazon](https://robinhood.com/stocks/AMZN/)__ [expects](https://snacks.robinhood.com/newsletters/540cTuIpTqabq5PMret6Zx/articles/2f6cF6488oIED70Eb3P8Vs/) sales to be up just 2% to 8% from last year (a major slowdown). As tech forecasts fall back to earth, investors are adjusting their expectations. Then again, lower expectations might mean less market disappointment.

__Trick or treat…__ But retailers aren’t spooked by candy-flation. Go-tos like __[Walmart](https://robinhood.com/stocks/WMT/)__, __[Costco](https://robinhood.com/stocks/COST/)__, and __[Lowe’s](https://robinhood.com/stocks/LOW/)__ widened their spooky selection by about 20%. This year Halloween spend is expected to hit a record $10.6B ($2B more than prepandemic), with Americans paying an average of at least $100 for goodies like fun-size candy bags, pumpkin plates, and wacky wigs (FYI: __[Home Depot](https://robinhood.com/stocks/HD/)__ sold out of its viral $200 life-size skeleton in one day). __[Hershey](https://robinhood.com/stocks/HSY/)__ is thriving on its sweet-and-salty strategy and expects Halloween candy to make up 10% of its annual sales.

- __[Jeezy](https://snacks.robinhood.com/newsletters/419JPU4iKFubhqsgTFUD7I/articles/e8sgVKCwr2g0Q13CQXp4h/):__ After 19 days of public backlash, __[Adidas](https://robinhood.com/stocks/ADDYY/)__ ended its partnership with Kanye West’s __Yeezy__ (nearly 10% of its revenue) after he made antisemitic statements. Balenciaga, __[Gap](https://robinhood.com/stocks/GPS/)__, __[Foot Locker](https://robinhood.com/stocks/FL/)__, and __CAA__ also dropped ties with West. 
- __[Zucked](https://snacks.robinhood.com/newsletters/419JPU4iKFubhqsgTFUD7I/articles/6tQrME9GLxpQ09CKaElahE/):__ It was a rough week for Meta, whose shares have plunged 28% after it reported "train wreck" earnings. Investors weren't sold on Zuck's vision of the metaverse, or the company’s $15B splurge on it.
- __[Feast](https://snacks.robinhood.com/newsletters/540cTuIpTqabq5PMret6Zx/articles/2cgO2YYLyxyIsoqJLc9P0r/):__ YouTube star MrBeast is said to be seeking a $150M investment to boost his empire, from viral videos to Beast Burgers. VCs interested in access to his 107M+ YouTube subscribers may see it as "fans as a service.”

Candy corn was originally called “Chicken Feed” and came out when farmers made up half of the US labor force