__Oh the weather outside is frightful…__ but the December jobs report is apparently delightful. Stocks rallied Friday after fresh labor data [showed](https://www.cnbc.com/2023/01/06/jobs-report-december-2022-nonfarm-payrolls-rose-223000-in-december-as-strong-jobs-market-tops-expectations.html) a slowdown in wage growth. Normally, that wouldn’t be a great sign, but in this “good is bad” economy it serves as more evidence that inflation is cooling. Read: the Fed’s rate-hiking crusade is working. 

- __*But also:*__ The job market’s still red hot. US employers added a stronger-than-expected 223K jobs last month and the unemployment rate fell to 3.5% (near historic lows). 

- __But *still*:__ Investors celebrated cooling wages, which can translate to cooling prices, which *could* translate to the Fed being less aggro with rate hikes. 

__Everyone’s worried about jobs…__ and no one’s worried about the job market? We’re seeing this paradox playing out: Americans are on edge over job security, but in November there were 1.7 openings for every available worker. Still, job growth is losing steam (employers are adding fewer roles each month) and mass layoffs are only heating up. 

- __Tech layoffs are happening at the fastest rate__ since the pandemic: last week __[Amazon](https://robinhood.com/stocks/AMZN/)__ announced plans to lay off 18K+ employees and __[Salesforce](https://robinhood.com/stocks/CRM/)__ said it’s cutting 8K. Online styling service __[Stitch Fix](https://robinhood.com/stocks/SFIX/)__ said it would let go of 20% of staff, while struggling crypto lender __Genesis__ slashed 30%.

- __Not just tech:__ While tech is a rate-sensitive industry, others like __[Goldman Sachs](https://robinhood.com/stocks/GS/)__, Dodge maker __[Stellantis](https://robinhood.com/stocks/STLA/)__, and __[Redfin](https://robinhood.com/stocks/RDFN/)__ have announced big cuts.

About 125K US workers lost their jobs last year (Johannes Eisele/Getty Images)

Wrong

__The labor market needs to get more wrong to feel right…__ The strong job market is the last remnant of the pandemic-stimulus era (recall: near-zero interest rates, fat checks). Job data is a lagging indicator, and we’re finally starting to see hawkishness catch up to it. But Fed officials said they’d need to see *sustained* cooling before easing up on hikes — a scenario investors are hungry for. At least the trend is moving in the right (cough, wrong) direction.

Investors celebrated cooling wages, but the layoff-laden labor market’s still too hot for comfort

__Securing the vault…__ __[Chase](https://robinhood.com/stocks/JPM/)__, __[Wells Fargo](https://robinhood.com/stocks/WFC/)__, __[Bank of America](https://robinhood.com/stocks/BAC/)__, and __[Citi](https://robinhood.com/stocks/C/)__ kick off bank earnings this week, and all eyes are on lending. So far, higher rates have boosted banking profits, since banks are earning more on deposits and loans (think: mortgages). In October, Chase reported that quarterly revenue jumped 10% to $33B while profit surged 34%. Bank of America and Wells Fargo also topped revenue estimates. While economic woes could hurt loan demand, delinquencies are still low, and analysts expect more growth when banks report. 

__Ready for takeoff…__ As __[Southwest](https://robinhood.com/stocks/LUV/)__ went into a tailspin, __[Delta](https://robinhood.com/stocks/DAL/)__ soared. Last month the Atlanta-based airline predicted its earnings would nearly double this year from last, jetting past expectations. CEO Ed Bastian said the post-Covid travel boom hasn't petered out, as people prioritize “experiential” spending over material goods. Delta seems to believe the good times will keep rolling: it agreed to multiyear raises for pilots and is adding customer perks like free Wi-Fi. We'll see if the highflying industry optimism lands in reality when Delta reports. 

Events

Coming up this week...

__Crypt*owned*…__ Customers of bankrupt crypto lender __Celsius__ got more bad news: a judge [ruled](https://www.wsj.com/articles/celsius-network-wins-ownership-rights-to-customer-crypto-deposits-11672865422?mod=business_minor_pos5) that the $4.2B in crypto they'd deposited into 600K interest-bearing accounts *belongs to Celsius*. Now those customers will be last in line to get repaid. The biz's terms of service, updated eight times, sealed the deal (lesson: *read the TOS*). The ruling could set the tone for customer compensation in other crypto-related bankruptcies (think: __FTX__, __BlockFi__). Meanwhile, the New York attorney general accused Celsius' founder of fraud.

__From phone screens to flat screens…__ stream-ification is coming for TV. Dongle icon __[Roku](https://robinhood.com/stocks/ROKU/)__ said it’s [launching](https://snacks.robinhood.com/newsletters/5yKJ21nHWy8FlNAUn6e6yJ/articles/3ogaCF6xZxf0H3Cnahar5k/) its own “streaming-first” TV sets. It’s good timing: in July streamers got more TV view time than cable networks for the first time as cord-cutting continued — and 87% of US households had a streaming sub last year. While televisions aren’t likely to go the way of cable, they *could* play a key role in a future where consumers toggle between services like __[Netflix](https://robinhood.com/stocks/NFLX/)__ and __[Disney+](https://robinhood.com/stocks/DIS/)__, changing streamers instead of channels. 

Zoom Out

Stories we’re watching...

- __[Fold](https://snacks.robinhood.com/newsletters/7aN8BRAzCXDnsbfVDy7Wtq/articles/6YKevppGSztYU76NseEC9p/):__ __[Bed Bath & Beyond](https://robinhood.com/stocks/BBBY/)__ shares plunged 47% last week after the embattled retailer said it might file for bankruptcy. OG category-killers are struggling to compete against online options (ahem, Amazon). 

- __[Elon](https://snacks.robinhood.com/newsletters/2l0dURsrtymAdOJZNwh8A2/):__ __[Tesla](https://robinhood.com/stocks/TSLA/)__ delivered a record 1.3M cars last year, but the stock posted its worst drop in over two years after #s fell shy of targets. Now investors worry Musk is too focused on __[Twitter](https://robinhood.com/stocks/TWTR/)__ — to Tesla’s detriment. 

- __[Run](https://snacks.robinhood.com/newsletters/7aN8BRAzCXDnsbfVDy7Wtq/articles/AJUGTZjQvUMrUwWVa1rPY/):__ __[Silvergate](https://robinhood.com/stocks/SI/)__, the bank that helped fuel the crypto boom, plans to cut 40% of its staff after wary customers pulled out $8.1B. Since Silvergate is a key crypto player, the wider industry could feel the fallout. 

ICYMI

Last week's highlights...

Investors celebrated cooling wages, but the layoff-laden labor market’s still too hot

Dow Jones

S&P 500

Nasdaq

Bitcoin

For the first time since 2014, Google and Meta no longer have the majority of US digital ad spend

🇺🇸 Labor’s right wrong turn

__Throwing in the (bath) towel…__ Shares of __[Bed Bath & Beyond](https://robinhood.com/stocks/BBBY/)__ lost over a quarter of their value yesterday after the embattled retailer [said](https://www.npr.org/2023/01/05/1147067967/bed-bath-beyond-warns-that-it-may-not-keep-operating) it might file for bankruptcy. Refresher: BB&B has racked up big debts over the years and has struggled to attract new shoppers online and in stores. Now the home-goods legend says it may not have enough $$ to cover key expenses.

- __Looking back:__ In September, BB&B [announced](https://snacks.robinhood.com/newsletters/70AWukI131xlHFLP88EM8T/articles/6EIEdveXK2qaTduU5Hv0ex/) lifeline plans to close 150 stores, slash 20% of its workforce, and raise $500M in financing. Update: it still needs help.
- __Moving forward:__ BB&B expects its net loss will soar 40% to $386M for the third quarter (which includes Black Friday). Q3 sales are forecast to sink 33% from last year.

__Private label, public problems…__ During the pandemic shopping boom, BB&B focused on creating private-label brands to compete with cheaper offerings from __[Amazon](https://robinhood.com/stocks/AMZN/)__ and __[Walmart](https://robinhood.com/stocks/WMT/)__. Yet the pivot resulted in shoppers struggling to find recognizable brands they actually wanted (think: __[Keurigs](https://robinhood.com/stocks/KDP/)__ and __KitchenAid__ mixers). Last year, BB&B said it had lost $175M in sales because of out-of-stock items. Now it’s still exploring non-bankruptcy options like restructuring and raising cash, but it could be too little too late.


So long to long coupons (Scott Olson/Getty Images)

Fold

__Category-killers are getting killed…__ Old-school category-killers like __[Barnes & Noble](https://robinhood.com/stocks/bks)__, Blockbuster, and BB&B snatched sales from small businesses as they spread across America. BB&B *used* to be the go-to for dorm hauls and bathroom makeovers. Now shoppers have a wide variety of online retailers (cough, Amazon) to choose from, and OG category-killers are dying. Case in point: __Toys R Us__ filed for bankruptcy in 2017 and __[JCPenney](https://robinhood.com/stocks/JCPNQ/)__ followed suit in 2020. 


Bed Bath & Beyond could go bankrupt as the coupon king loses its category-killer crown

__Mega bank run…__ The California bank that helped fuel the crypto boom is feeling crypto winter's wrath. __[Silvergate](https://robinhood.com/stocks/SI/)__ [announced](https://www.bloomberg.com/news/articles/2023-01-05/silvergate-tumbles-after-bank-posts-loss-fires-40-of-staff) yesterday that it's cutting 40% of its staff following an $8.1B bank run — which the biz says forced it to sell assets at a $718M loss to cover. That's more than its total profit since 2013 (ouch). That news, plus word that Silvergate's halting its digital-currency plans (down the drain: $196M spent on __[Facebook's](https://robinhood.com/stocks/META/)__ Diem tech) led to a nearly 50% decline in Silvergate stock. Now its execs say the biz could be a takeover target.

 __High roller…__ with a low-key profile. Silvergate greases the crypto industry's wheels by helping big businesses move big bucks in and out of crypto platforms. 90% of the bank's deposits are crypto-related. It’s provided banking services to __[Coinbase](https://robinhood.com/stocks/COIN/)__ and __Gemini__ and held deposits for both __[FTX](https://robinhood.com/crypto/FTT/)__ and its sister hedge fund, __Alameda Research__. Once it got into crypto, it blew up fast: by 2019 it served 1.6K miners, exchanges, and crypto custodians. As of last year, it held $16B in deposits — up from $2B in 2020. Now it’s blowing up again, in a bad way:

- __Crypt-no:__ Silvergate execs said yesterday that its customers were closing accounts and pulling out of crypto altogether. 
- __SBF’d:__ Last month lawmakers questioned the bank over any possible role in the loss of billions in FTX customer funds. 


__Big bets mean big risks…__ Silvergate put most of its eggs in the crypto basket, helping it grow from a relatively small SoCal bank to an industry player. But as crypto winter set in and investors ran for sunnier pastures, that basket has come back to bite it — and the wider industry could suffer from the fallout. Silvergate’s expected to report this month. 

Crypto mega bank Silvergate sheds staff and bails on digital-currency plans as customers pull out billions

- 🤹‍♀️ __Quirky…__ NFTs are [heading](https://www.businessoffashion.com/news/technology/hermes-and-the-metabirkins-creator-are-set-to-go-to-trial/) to a US court this month after luxury designer Hermès sued an artist over his digi assets depicting Birkin bags (meet: MetaBirkins). The trial could set the tone for how courts treat NFTs.

- 🪙 __Coins…__ A judge [ruled](https://www.reuters.com/business/finance/us-judge-says-celsius-network-owns-most-customer-crypto-deposits-2023-01-05/) that bankrupt crypto lender __Celsius__ *owns* the $4.2B that customers deposited into 600K interest-bearing accounts (putting them last in line for repayment). Also, the NY attorney general [sued](https://www.nytimes.com/2023/01/05/technology/attorney-general-mashinsky-crypto.html) Celsius's founder, accusing him of fraud. 
- 🌶️ __Spicy…__ Sam Bankman-Fried [pleaded](https://www.wsj.com/articles/sam-bankman-fried-pleads-not-guilty-to-fraud-and-other-offenses-11672774004) not guilty to eight criminal charges related to __FTX’s__ collapse. His trial is scheduled to start in October, but two former colleagues have already pleaded guilty. 


NFTRIAL

The Crypto Catch-Up…

Last year Ford sold, on average, one F-Series pickup every 49 seconds

🛀 Bed Bath & Bankrupt?

__The dongle has company…__ Ding-dong: it’s a TV. Streaming staple __[Roku](https://robinhood.com/stocks/ROKU/)__ is launching its own line of television sets. Refresher: Roku’s software-connected dongles are a cheaper alternative to Apple TV’s sleek black controllers. A third of America’s televisions run Roku software. But now it’s doubling down with its own small-screen hardware. 

- __Flat stream__: Roku aims to launch its TV lineup this spring, and it’s not skimping on options. Think: 11 models ranging from 24 to 75 inches, with prices starting at $119 all the way up to $999. 
- __Fire competition__: Fire Stick rival __[Amazon](https://robinhood.com/stocks/AMZN/)__ began selling its Fire-branded 4K TVs in 2021 to Amazon-ify your streaming experience. Picture: telling Alexa to stream Amazon Prime on a Fire TV. 
- __Roku stock__ jumped 4% yesterday but is down 81% over the past year. It has struggled with an ad downturn and shrinking profit margins. FYI: Roku makes most of its $$ from ads on The Roku Channel and other channels. 

__Laptop < flat screen…__ Streaming accounted for only a fourth of America’s TV viewing time in mid-’21. Read: most Americans were streaming from their laptops or phones, not TV sets. Things have changed: in July streamers got more TV view time than cable networks for the first time. As cord-cutting continues, 87% of US households had a streaming sub last year.

Pre-dongle era (Lambert/Getty Images)

Dongle

__Streamers could replace channels…__ Companies like Roku and Apple are trying to make TV a streaming-first experience vs. a cable-first experience. Roku’s CEO said that its new TVs “are designed to be streaming first.” Instead of surfing channels, the goal is to have users toggling between streamers on Roku’s interface. TVs aren’t likely to go the way of cable; instead, they could play a key role in a future where consumers switch between __[Netflix](https://robinhood.com/stocks/NFLX/)__, __[Disney+](https://robinhood.com/stocks/DIS/)__, __[Apple TV+](https://robinhood.com/stocks/AAPL/)__, and other services — changing streamers instead of channels.

Dongle icon Roku unveils its own TVs as streamers vie to make television streaming-first

__Social net worth…__ The president of US crypto exchange __Gemini__, Cameron Winklevoss (refresher: sued Mark Zuckerberg over __[FB](https://robinhood.com/stocks/META/)__'s origins), has new public beef. On Monday, Winklevoss accused Barry Silbert, the CEO of crypto conglomerate __DCG__, of "unconscionable" behavior. Winklevoss says that DCG's crypto-lending subsidiary, __Genesis__, won't return $900M that belongs to his Gemini customers. He gave Silbert a Sunday deadline to commit to making his customers whole. 

- __Salad days:__ Earlier this year, Gemini customers could authorize the exchange to lend out their crypto to earn interest potentially as high as 8%. Gemini lent that crypto to Genesis, which lent it out again. 
- __Pallid haze:__ After __FTX__'s collapse in November, Genesis paused loan redemptions (aka repayments), leaving Gemini customers' money in limbo. 

__Crypto lending meets contagion…__ Crypto is a highly leveraged industry (think: using borrowed assets to make trades). So when big players implode, contagion can spread. Genesis isn't the only crypto lender to freeze up during crypto winter. In June, __Celsius__ paused redemptions on customer loans with advertised yields up to 18% — and filed for bankruptcy a month later. And in August, Singapore-based lender __Hodlnaut__ froze customer withdrawals. 

Drama

__Crypto stopped being polite…__ and started getting real. Crypto winter and subsequent contagion could deal final blows to the industry's WAGMI ("we're all gonna make it") ethos. Now, at the very real risk of not making it, it's every firm — and customer class-action lawsuit — for itself. Winklevoss' public calling out of Silbert "for the final time" is what happens when the crypto tide goes out and everyone scrambles for a boat. 


Gemini's Winklevoss issues a $900M deadline as contagion drama becomes dirty laundry

Elon Musk is the first person to lose $200B in wealth

📺 Roku’s TV revolution

__’Twas Elon-g year…__ Between launching rockets, running __[Tesla](https://robinhood.com/stocks/TSLA/)__, and buying __[Twitter](https://robinhood.com/stocks/TWTR/)__, it was a very long year for Elon Musk. Tesla kicked off the brand-spanking-new year by reporting its latest delivery numbers. The EV pioneer [unloaded](https://www.cnbc.com/2023/01/02/tesla-tsla-q4-2022-vehicle-delivery-and-production-numbers.html) 1M+ cars for the first time, but Wall Street wasn’t impressed with the final tally: Tesla stock plunged 12% yesterday — its worst drop in over two years.

- __Tesla Wrapped:__ Elon’s baby delivered a record 1.3M cars last year, up 40% from 2021. The impressive growth still fell shy of the 50% target Tesla had set. 
- __UnMuskular:__ Fourth-quarter deliveries were up 18% from the previous quarter, to 405K cars, disappointing analysts’ (already lowered) expectations. Demand for Teslas has softened as rising interest rates bite consumers.

__Less editing mode, more Ludicrous mode…__ Some investors saw the disappointing results as confirmation that Musk is too distracted with running Twitter — but Tesla’s year was a mixed bag of wins and losses:

- __Attraction:__ Tesla’s growth rate [beats](https://www.nytimes.com/2023/01/02/business/tesla-fourth-quarter-sales.html) all its major rivals, it’s one of the most profitable carmakers, and it’s boosting production at new digs in Texas and Germany.

- __Traction:__ Tesla had to halt production numerous times at its largest factory, in Shanghai, as China’s strict Covid policy continued. Meanwhile, electric-car maker BYD surpassed Tesla’s sales in China, casting doubt on its future dominance. 
- __Distraction?__ To some, Musk appears to have been preoccupied with revamping Twitter, which he bought in October for $44B. He sold billions worth of his Tesla shares to help finance the buyout.

Blue checkmarks on the brain? (Justin Sullivan/Getty Images)

Distraction

__Doing the most comes at a cost…__ because even Elon Musk can’t be everywhere all at once. Last year Tesla stock sank 67% as many investors lost confidence in the company’s future. Some worry that Musk may be focusing too much energy on Twitter — to Tesla’s detriment. The billionaire entrepreneur also runs rocket company __SpaceX__, tunnel transportation enterprise __The Boring Company__, and brain-implant startup __Neuralink__.

Tesla unwraps a yearly record, but fails to deliver a confidence boost as Elon’s Twitter era takes focus

__The cancellation before Christmas…__ Holiday festivities may be over, but lots of travelers are still recovering from a __[Southwest](https://robinhood.com/stocks/LUV/)__-flavored hangover. ICYMI: the Dallas-based airline [canceled](https://www.cnbc.com/2023/01/03/southwest-cancellations-stabilize.html) over two-thirds (think: 15K+) of its Christmas-week flights after a historic winter storm overwhelmed its operation systems and left hundreds of thousands of fliers stranded. The Department of Transportation said it’s investigating the meltdown and will hold Southwest accountable for reimbursing affected travelers. 

- __The good:__ On Monday, Southwest said its schedules were almost back to normal after it reduced capacity to recover from the cancellations.
- __The bad:__ There are still mountains of unclaimed luggage. Southwest is working with __[FedEx](https://robinhood.com/stocks/FDX/)__ and __[UPS](https://robinhood.com/stocks/UPS/)__ to return lost bags.
- __The ugly:__ The fiasco could cost Southwest $700M after covering ticket refunds and expenses like hotels and rental cars.

__Old system, new snags…__ Airlines have been historically slow to adopt new software, because bugs can lead to grounded planes and passengers. Over the years Southwest’s pilot and flight-attendant unions have complained about the airline's outdated tech. They argued that it left the company vulnerable and that updating it should be a higher priority than shareholder perks (picture: dividends). Analysts expect the holiday tailspin to slash nearly a tenth of Southwest’s earnings when it reports this month.

Baggage

__Failure to upgrade can mean a major downgrade…__ Some experts say Southwest and other airlines have prioritized upgrading customer-facing systems (like: reservations and loyalty programs) over its back-end systems. While tech hiccups aren't usually a deal breaker in daily airline operations, they can be catastrophic when combined with outside disruptions like last month's massive storm. Southwest's fallout could spur other airlines to update their systems — or risk being grounded by customers.

Southwest’s holiday meltdown could cost it $700M — and serve as a cautionary tale for other airlines

📠 *Like an office worker endlessly scanning and uploading docs…*

Crypto lives on the blockchain, but some smart contracts depend on real-world (aka "off-chain") data. An oracle is a third party responsible for providing off-chain info like sports scores, weather, and the price of gold to smart contracts like prediction markets or digital casinos. Oracles are increasingly seen as a crypto security [weak spot](https://www.bloomberg.com/news/articles/2022-12-28/crypto-trader-charged-with-fraud-in-110-million-alleged-mango-markets-scam).

DEFI(NE)

Heard on the Block: "oracle"

Tesla unwraps an annual record, but fails to deliver an investor-confidence boost

80% of people who make a New Year’s resolution give up by mid-February

🚗 Tesla’s mixed delivery

- __AI gets (scary) creative…__ [Generative AI](https://snacks.robinhood.com/newsletters/3WEG5SgBgeQScK91kmZwOc/articles/6gWjpZswZYcdRi0vcvZQos/), which can convert text prompts into images and articles, made a splash last year. __OpenAI__ [released](https://snacks.robinhood.com/newsletters/1tqjd2M4HaTR4MDXIMoYcr/articles/7IJUQSHnMsihoZe3E8Wbv2/) its futuristic chatbot, ChatGPT, to the public last month, shortly after launching its image generator, DALL-E. The impressive tools caused shock and awe — *and* raised fears they could replace creative professions like copywriting and design (__Jasper__, a genAI tool used for marketing copy, hit a $1.5B valuation). Some teachers are convinced genAI will kill homework too. While unknowns abound, investment is booming as companies seek innovative ways to automate work. 

- __Crypto rediscovers its roots…__ The [collapse](https://snacks.robinhood.com/newsletters/5oS3vfl3q3m34Ud64MuTOf/articles/6GVY28qbI5kcW4Y5gvzbIM/) of centralized crypto players like __FTX__ and __Celsius__ breathed life back into crypto's core conceit: decentralization. Decentralized exchanges (think: not run by a biz) like __[Uniswap](https://robinhood.com/crypto/UNI/)__ saw activity spike — briefly surpassing centralized __[Coinbase](https://robinhood.com/stocks/COIN/)__ in ether trading — as people sought greater control of their crypto. Makers of self-custody hardware wallets (picture: no exchange needed) reported soaring sales, while decentralized-finance transaction volumes jumped 68% from October to November. The decentralized momentum could get a boost as bipartisan lawmakers push tighter crypto regs.

Jetsons vibes (MR.Cole_Photographer/Getty Images)

NEXT YEAR

The future is now…

- __Transpo goes auto…__ Transportation goes autonomous — of packages *and* people. First, drone deliveries could go mainstream. Last month __[Amazon](https://robinhood.com/stocks/AMZN/)__ began dropping parcels with its Prime Air service. __[Walmart’s](https://robinhood.com/stocks/WMT/)__ expanding its DroneUp network while __[Google’s](https://robinhood.com/stocks/GOOGL/)__ Wing teamed up with __[Walgreens](https://robinhood.com/stocks/WBA/)__ for Dallas deliveries. Below the skies, autonomous freight trucks are expected to hit roads by next year. On the passenger side, __Cruise__ and __Waymo__ are boosting driverless rides in cities, while __[Uber](https://robinhood.com/stocks/UBER/)__ and __[Lyft](https://robinhood.com/stocks/LYFT/)__ partnered with __Motional__ to start robotaxi ride-hails next year. “Auto transpo” could ease driver shortages and backlogs.
- __A psychedelic renaissance...__ Psychedelic-drug startups (think: shrooms, LSD) have seen record investing in recent years as more health experts explore the benefits of hallucinogens. Last year, Johns Hopkins said one of its psychedelic treatments eased depression symptoms, and other experts say trippy treatments could help with anxiety and PTSD. While still illegal federally, psychedelics are decriminalized in [several](https://www.leafly.com/news/politics/where-are-psychedelics-legal-or-decriminalized-in-the-us) US cities and are approved for recreational use in Oregon and Colorado. Now the psychedelic-substances biz is predicted to grow 5X to $10B+ by 2027 — which would outpace the legal-pot industry.

IN FIVE YEARS

Around the corner…

- __The nuclear revolution…__ The future of clean energy could be nuclear. Last month scientists made a huge [breakthrough](https://snacks.robinhood.com/newsletters/7BujElyo2t6JbWrNXJ6eKK/) after successfully using a nuclear-fusion reaction to generate 50% more energy than what was required for its creation — aka "net energy gain.” Nuclear fusion releases 4M times more energy than burning oil, coal, or gas and can unlock "virtually limitless" carbon-free power. While commercial use for fusion tech (think: electricity, heating homes) is still decades away, the overall market could be worth $40T down the road. It could be a green solution to prevent energy crises.
- __Central bank digital currencies take off…__ Last year the Treasury Department kicked the [CBDC](https://snacks.robinhood.com/newsletters/1A2u0znpU82FzymAPSjQXf/articles/1L1NHg7KzXFnkMFjrjfx21/) can down the road, saying it would reevaluate the need for a government-backed digital dollar (possibly powered by crypto) in 5+ years. When it does, it may need to play catch-up. China began its CBDC test in 2020, India started testing one last year, and the European Central Bank says it's looking into CBDCs. Meanwhile, the Fed is set to launch a real-time interbank payments system this year, which suggests a digital payments overhaul of some kind is already in the works.

IN 10+ YEARS

Down the road…

6 trends that could shape the futuristic economy, from creative AI to drone deliveries

India is set to overtake China as the most populous country by 2030

🔮 The futuristic edition

__Clear out the garage…__ __[Tesla’s](https://robinhood.com/stocks/TSLA/)__ offering a rare year-end sale on its most popular cars as it looks to *supercharge* demand. Starting this week, the EV icon’s offering $7.5K off Model 3 and Model Y orders delivered in the US by the end of the month. FYI: those are Tesla’s least pricey cars, and they typically make up the majority of deliveries. The discount is double the $3,750 credit Tesla offered earlier this month (and includes 10K miles of free supercharging). Plus:

- __Charged up:__ The discount comes days after the Treasury Department delayed restrictions on EV incentives until March, so Teslas can qualify for the full $7.5K credits until then.
- __Sold out:__ Despite Tesla's history of rushing year-end deliveries to meet targets, discounts are rare for the carmaker (and may not be enough to drive sales).

__Tesla’s no good, very bad year…__ Shares of Tesla are down 60%+ this year and are on pace for their worst-ever annual performance. In October, Tesla said it would miss its delivery goals for the year as slowing growth and supply-chain disruptions hit drop-offs. Meanwhile, some customers have started to cancel or delay deliveries until the EV credits kick in next year. It’s not the only speed bump:

- __Investors say:__ CEO Elon Musk's controversial leadership over at __[Twitter](https://robinhood.com/stocks/TWTR/)__ could be a risk to Tesla’s brand (and sales).
- __Elon says:__ Tesla demand is still hot, and experts say the stock's troubles are due to more people moving their $$ out of equities and into savings accounts.

Just missing the bow on top (Spencer Platt/Getty Images)

Charge

__Lower prices can raise the stakes…__ Since more people have paid top dollar for new cars during the car shortage, most automakers haven't had to offer discounts. While promos could give Tesla a last-minute boost, it could also be a sign that demand isn’t quite as strong as expected. That’s bad timing with competition heating up. Some analysts say that by 2025 Tesla's share of the EV market could drop to under 20%.

Tesla’s offering a rare year-end sale on its most popular models as EV affordability and demand dwindle

Tesla’s having a surprise year-end sale, as the EV maker tries to recharge demand

Snow isn’t actually white — it’s translucent

🚗 Tesla’s having a surprise year-end sale, as the EV maker tries to recharge demand

__Flyin’ like an eagle…__ Nike’s [stock](https://robinhood.com/stocks/NKE/) jumped 13% yesterday after the sneaker icon posted fire earnings results. Nike’s revenue grew 17%, to $13B+, in the quarter ending in November, as more shoppers splurged on the swoosh. Now execs expect annual revenue to grow in the “low teens,” to notch a slight improvement over last quarter’s forecast. Plus:

- __On sale:__ Nike saw record traffic on Black Friday and Cyber Monday, with some European markets seeing shopping demand jump 75% from last year.
- __Good fit:__ Nike’s North American sales popped 39%, helping offset lower demand (and a 3% sales dip) in China, Nike’s third-largest market.
- __Overstocked:__ Nike’s inventories are still 43% higher than a year ago, but the company says it’s finally passed its oversupply peak. It's been a long time coming. 

__Checking the back room…__ for another pair of high-tops. Like many retailers, Nike’s had to manage overstock, supply-chain disruptions, and the threat of a consumer-buying slowdown. With retail inventories in the US up 17% from last year, Nike and its rivals have ramped up discounts to move extra merch. While promos can shrink profit margins, for the right brand it can also boost demand. Case in point: Nike’s cheaper price tags sparked record growth for its digi-membership program, while its wholesale division (think: __[Foot Locker](https://robinhood.com/stocks/FL/)__, __[Finish Line](https://robinhood.com/stocks/FINL/)__) saw a 19% sales jump.

Fresh workout threads (Mattia Pistoia/Getty Images)

Sneaks

__A step in the right direction…__ As the world's largest athletic-apparel company, Nike is a bellwether not only for retailers but also the economy. For rival brands, Nike’s strong earnings could be a sign that while inventories are still high, there may be greater demand for their products in the near future. For investors, it suggests that even as recession fears loom, the consumer’s still willing to splurge on the right brand (and price tag).

Nike posts slam-dunk earnings as strong demand helps counter inventory woes — and reveals a bright spot for consumer spending

Nike posts slam-dunk earnings as strong sneaker demand helps counter inventory woes

A World Cup Instagram post by Lionel Messi is the most-liked ever

👟 Nike tackles inventory woes

__Skipping the intro…__ and the ads along with it. __[Netflix's](https://robinhood.com/stocks/NFLX/)__ new advertising-supported tier, launched early last month, accounted for only 9% of November sign-ups, according to [estimates](https://www.wsj.com/articles/netflixs-ad-supported-tier-was-its-least-popular-plan-in-launch-month-analytics-firm-estimates-11671539939). The $7-a-month plan represents the Flix's bid to diversify revenue and pull in more subscribers with a less expensive offering. It came toward the end of a roller-coaster year for the streamer, which included subscriber losses and layoffs. Now, some early results are in:

- __Press save:__ 43% of new ad-tier subscribers downgraded from an existing Netflix plan. 
- __Cord *and* cost cutting:__ The other 57% of sign-ups were a combo of brand-new subscribers and people rejoining after previously canceling subs.

__Binge-watching…__ your fave 30-second commercials. Netflix isn't the only streamer to offer an ad-supported tier, but it is arriving late to the party. As of last month, more than 20% of rival HBO Max's subscribers were estimated to be on its ad plan (which launched mid last year). That # is 57% for Hulu subscribers, and 90% for Peacock. Still, Netflix has lots of room to grow: it boasts 223M subscribers (as of September) vs. HBO Max owner __[Warner Bros. Discovery's](https://robinhood.com/stocks/WBD/)__ 95M — both of which dwarf Peacock's 18M.

*Click* (Chesnot/Getty Images)

Pause

__Ads are a vital tool in streamers' arsenals…__ if they can figure out how to wield them. Companies like Netflix are battling pervasive subscription fatigue and inflation headwinds (picture: higher prices squeezing customers' entertainment budgets). Ad-supported tiers represent a way both to woo on-the-fence viewers and to retain those looking for the exits. But as Netflix's early #s suggest, they can cut both ways: cheaper options might cannibalize existing premium customers. Meanwhile, the Flix said it's "very early days" for its ad-supported plan, suggesting the ad-based streaming surge is only just beginning.

Netflix's ad-supported plan arrived with a thud as streamers battle inflation and subscription fatigue

Netflix's ad-supported plan meets subscription fatigue as streamers bet on ads

In 1965 “Jingle Bells” became the first song to be performed in space 

🍿 Netflix's ad flop

__Watch out, kids…__ there's a new demo taking over toy aisles this holiday szn. A recent [report](https://www.cnbc.com/2022/12/19/kidults-biggest-sales-driver-toy-industry.html) said "kidults" (aka people aged 12+) now make up a fourth of all US toy sales and 60% of the industry's dollar growth. FYI: People typically drop off from buying toys in their early teens, but that trend’s shifting.

- __Adult prices:__ While US toy sales fell slightly in the first nine months of this year, inflated price tags helped to drive revenue 3% higher.
- __Childhood dreams:__ Kidults account for just 5% of global toy sales, but generate $9B in annual revenue.

__Three-hour checkout line…__ for an $850 Millennium Falcon Lego set. The pandemic was a boom time for the toy biz, as home-bound adults splurged on board games and 1K piece puzzles. And the popularity looks to have stuck: last year, the global toy market had its best sales in a decade, with the US driving most of the growth. Now toy makers are creating more adult-friendly products to capture grown-ups' inner child (and their wallets).

- __Lego,__ the world’s largest toy maker, posted record sales in September as adults splurged on "Harry Potter"- and "Star Wars"-themed sets.
- __[Build-A-Bear](https://robinhood.com/stocks/BBW/)__ says 40% of its sales now come from adults and teens, up from 20% in 2012.
- __[Hasbro](https://robinhood.com/stocks/HAS/)__ and __[Mattel](https://robinhood.com/stocks/MAT/)__ ramped up marketing for __[Disney’s](https://robinhood.com/stocks/DIS/)__ Marvel superheroes figurines, and ’90s toy icons like Barbie, __Pokémon__, and Hot Wheels.

And a little somethin' for yourself (John MacDougall/Getty Images)

Play

__Toy lovers are growing up…__ and the industry's following suit. Serving kidults is becoming a winning strategy as they’re seen as willing to spend serious $$ on themselves. (Even __[McDonald’s](https://robinhood.com/stocks/MCD/)__ started selling adult happy meals.) The kidult demo could be extra important for toymakers this holiday szn, as many expect the game-lovin' grown-ups to purchase toys for the kids *and* fellow adults in their lives.

“Kidults” are driving the toy industry as older shoppers splurge on superheroes and building sets

🧸“Kidults” are driving the toy biz, as older shoppers splurge on superheroes and building sets

Global coal use is set to hit a record high by year's end

🧸 The “kidult” toy takeover

__Hot jobs eats…__ meet cool inflation treats. Last week's strong jobs report [surprised](https://www.bloomberg.com/news/articles/2022-12-15/us-jobless-claims-unexpectedly-drop-to-lowest-since-september) analysts expecting higher unemployment #s. Instead, new claims fell to their lowest level since September. That's not all: last week's inflation report showed that prices grew more slowly in November than experts had predicted (think: 7.1% in a year vs. 7.3%). Now some Wall Street analysts hope the US economy can avoid a recession with a Goldilocks-like "soft landing" (picture: a controlled economic slowdown).

- __Threading a needle…__ while doing cartwheels. Soft landings are difficult to pull off. They're rare too: the last one was in 1994.
- __Times’ve changed…__ Economists say that unlike in the ’90s, we're now facing dual supply shocks with Covid and Russia's war on Ukraine.

__The “[vibecession](https://nymag.com/intelligencer/2022/08/recession-or-vibecession.html)” will be televised…__ With wage growth lagging behind inflation and countless headline-making layoffs — 114K tech workers have been axed since March alone — the economic vibe this year has been rough. But *reality's* been mixed. Gas is cheaper than a year ago, and 72% of those laid-off tech workers found jobs within three months. What's more, over half of those rehired workers got a pay bump. More bright news: just last week Fed Chair Powell said new growth-rate projections are not in recession territory.

Practically givin' it away (Brandon Bell/Getty Images)

Mixed

__Recession worries ≠ recession reality…__ CEOs have been forecasting economic doom and gloom for months. In June, __[JPMorgan's](https://robinhood.com/stocks/JPM/)__ CEO warned of an economic "hurricane," and last week __[United Airlines'](https://robinhood.com/stocks/UAL/)__ CEO said the company was preparing for a "mild recession." A recession could still happen. But it's also possible that the Fed's ongoing rate hikes could work as intended: slowing the economy down just enough for the fabled soft landing.

Cooling inflation and a hot jobs report prompt soft-landing talk, but the “vibecession” is hard to shake

__All aboard…__ cruise szn is back on. After the pandemic forced ships to dock for nearly three years, companies like __[Carnival](https://robinhood.com/stocks/CCL/)__ have sailed back to record bookings. Last quarter, the world’s biggest cruise operator saw its revenue jump 700% to $4.3B as more travelers hit the seas. Still, Carnival shares lost over half their value this year as the biz navigated higher costs (like: oil and gas) and lingering Covid disruptions. But as the travel boom heats up again, analysts expect smoother sailing and revenue growth when Carnival reports on Wednesday.

__$6 mozz sticks…__ $5 delivery fee. NYC could soon let food-delivery apps charge restaurants more. Refresher: when the pandemic hit, lawmakers limited fees to 20% in the US's largest food-delivery market. Now __[Grubhub](https://robinhood.com/stocks/GRUB/)__ and __[DoorDash](https://robinhood.com/stocks/DASH/)__ are pushing a bill that would let them charge more $$ for perks like marketing. Supporters say the bill could help small eateries get greater exposure, while critics say it favors big franchises that can afford to splurge. The clock’s ticking: delivery apps hope that extra fees can help offset the higher wages that could go into effect in Gotham early in the new year.

- __[Bust](https://snacks.robinhood.com/newsletters/3kOsGkEHbBt1CqkaBXzvxc/articles/6NgSN4kssplfENc3RTUY6p/):__ Federal prosecutors brought criminal charges against crypto "wunderkind" Sam Bankman-Fried last week. Lawmakers and regulators could crack down on other centralized crypto players next.
- __[Power](https://snacks.robinhood.com/newsletters/7BujElyo2t6JbWrNXJ6eKK/):__ The US Department of Energy announced a [milestone](https://www.bloomberg.com/news/articles/2022-12-13/nuclear-fusion-energy-will-likely-take-decades-to-reach-commercial-viability) last week in the development of fusion energy. But commercial nuclear-fusion tech (picture: electricity, heating homes) could be decades away.
- __[Lux](https://snacks.robinhood.com/newsletters/4Jy0RmQnV60oK4MUgx5hqa/articles/7driDwhdTnucdUECh5IdPQ/):__ More Americans are heading to Europe to splurge at designer stores, courtesy of the strong dollar. While the shopping spree is great for European retail, it could discourage tourism and spending in the US.

Inflation and job numbers prompt soft-landing talk, but the “vibecession” is hard to shake

Argentina’s World Cup title victory yesterday was the first for superstar Lionel Messi and the third win for his country since 1978