__Cold Brew spring in Beijing…__ After years of strict zero-Covid policies and lockdowns, China is again open for business. Last quarter consumers returned to spots like China's 6.2K __[Starbucks](https://robinhood.com/stocks/SBUX/)__ and Shanghai Disney Resort, boosting sales for US corporations. Lots of companies — including __[MGM Resorts](https://robinhood.com/stocks/MGM/)__, __[Procter & Gamble](https://robinhood.com/stocks/PG/)__, KFC parent __[Yum Brands](https://robinhood.com/stocks/YUM/)__, __Starbucks__, and __[Disney](https://robinhood.com/stocks/DIS/)__ — [said](https://www.cnbc.com/2023/05/14/china-sales-help-starbucks-yum-mgm-disney-tapestry.html) that the China rebound lifted their latest earnings. But it didn’t help everyone: 

- __iDidn’t benefit:__ __[Apple](https://robinhood.com/stocks/AAPL/)__'s China sales *shrank* last quarter from a year earlier, foiling hopes that demand would bounce back after restrictions were lifted.

- __Mascara tears:__ __[Estée Lauder](https://robinhood.com/stocks/EL/)__ stock plunged this month after the beauty behemoth gave a weak outlook, saying Asia demand didn’t come back as strong as expected.

- __Travel light:__ Though international Chinese tourism is back, it’s still much lower than prepandemic levels. Many are traveling closer to home (think: MGM’s Macau casinos). 

__Not so snappy…__ So far China’s recovery has been meh. April economic data released this week disappointed, with industrial production and retail sales growing less than forecast. Meanwhile, the youth-unemployment rate last month surpassed 20% for the first time. That’s far from inspiring, since younger consumers are key to fueling spending. Five months into the reopening, most companies are still waiting to reach prepandemic sales levels.

A half-and-half recovery (CFOTO/Getty Images)

Unzero

__The Chinese consumer is key…__ As the second-most-populous country with a growing middle class, China holds a lot of weight for multinational corps. Spending there is even *more* important to US companies now that Americans are tightening their budgets. The highly anticipated rebound has underwhelmed so far, yet some analysts predict a summer of “revenge spending.”

China’s reopening boosts sales for US companies, but not nearly as fast as hoped

__“Succession”-size problems…__ Last year the median pay for S&P 500 CEOs dropped for the first time in a decade, falling to $14.5M, The Wall Street Journal [reported](https://www.wsj.com/articles/ceo-pay-packages-fell-sharply-in-2022-as-the-stock-market-sank-3d06eb69?mod=hp_lead_pos1). Chief execs are mostly paid in company stock, and the S&P 500 shed nearly 20% last year (womp). By the end of 2022, two-thirds of executives got smaller pay packages than originally awarded. 

- __New rule:__ Traditionally packages were revealed only when they were awarded. As of last year, the SEC started requiring reporting of compensation “actually paid” by the end of the year.

- __Expectation vs. reality:__ The change forces a direct comparison between how much executives were initially awarded and how their companies performed.

__Started from the top…__ Some execs who were initially awarded the biggest packages saw the value of their equity plunge, while others rose through the ranks: 

- __Wipe-out:__ The top-paid corporate leader, __[Alphabet](https://robinhood.com/stocks/GOOGL/)__'s Sundar Pichai, was awarded a package valued at $226M, but that fell to $116M after a year of battered tech stocks.

- __Gains:__ The big bosses of __[Exxon](https://robinhood.com/stocks/XOM/)__ and __[Chevron](https://robinhood.com/stocks/CVX/)__ saw the value of their payouts more than double by the end of the year as oil stocks surged, pushing them from the No. 15 and No. 62 best-paid CEOs into the top 5.

Paycut

__When times are tough, scrutiny gets tougher…__ Last year, a record # of companies *didn’t* receive majority support from shareholders for CEO pay packages. Recently, entertainment execs’ pay has been put under a microscope as the Writers Guild of America strikes. Nearly half of __[Warner Bros.](https://robinhood.com/stocks/WBD/)__ shareholders voted on Monday against CEO David Zaslav’s pay. At the same time, record buybacks are drawing side-eye from investors who worry they’re merely pumping execs’ bonuses.

CEO pay fell for the first time in a decade as shareholders size up top execs’ comp

Dow Jones

S&P 500

Nasdaq

Bitcoin

Nearly 8 in 10 Americans say it's a bad time to buy a house — a 45-year high

🇨🇳 China’s meh rebound

__The seat-belt sign is on…__ and there could be turbulence ahead for summer travelers. At least 25K US pilots have voted to [authorize](https://www.washingtonpost.com/travel/tips/southwest-strike-united-american/) a strike this month as peak travel season approaches and new contracts haven’t been reached with major carriers. Pilots at __[American Airlines](https://robinhood.com/stocks/AAL/)__ and __[Southwest](https://robinhood.com/stocks/LUV/)__ overwhelmingly approved a strike, and those at __[United](https://robinhood.com/stocks/UAL/)__ picketed last week.

- __Full flight:__ 80% of US air travel is flown by four carriers — American, United, Southwest, and __[Delta](https://robinhood.com/stocks/DAL/)__ — three of which have potential work stoppages looming.

- __Slipstream:__ After Delta pilots authorized a strike last year, the airline approved a $7.2B pay hike that’ll boost wages by 34% over four years. Pilots at competing airlines are seeking similar deals, plus more reliable schedules.

- __Red-eye:__ For airlines this is particularly bad timing for a labor dispute. The industry faces a staffing crunch, __[Boeing](https://robinhood.com/stocks/BA/)__ jet shortages, and booming summer demand.

__Planes, trains, and labor disputes…__ Airline and railway strikes are rare because Congress can vote to block them with a law that protects interstate commerce (see: Biden blocking a nationwide rail strike in December). But frustrated pilots could still disrupt airline schedules by refusing to work overtime. Meanwhile, airlines are facing a surge in pilot retirements given the FAA’s age limit of 65: half will be forced to retire in the next 15 years.

United Airlines pilots at SFO (Justin Sullivan/Getty Images)

Boarding

__Essential workers are waiting for their payday…__ Pilots — like rail workers, delivery drivers, educators, and nurses — were all essential to the economy as the pandemic halted work in other sectors. Contract negotiations are coming due in nearly all these industries, as essential workers come out of the pandemic without significant pay bumps. If unresolved, it could mean disruptions in everything from shipping to healthcare.

US pilots seem set on striking as staffing shortages collide with booming vacay demand

__Sunset in Viceland…__ __Vice Media__, the news company behind sites like Motherboard, Refinery29, and (of course) Vice.com, has [filed](https://www.nytimes.com/2023/05/15/business/media/vice-bankruptcy.html) for bankruptcy. Yesterday it agreed to sell most of its assets to a group of creditors for $225M — a far cry from its $5B+ valuation six years ago. Refresher: Vice launched in the mid-'90s and quickly gained fame thanks to its edgy headlines and quirky docu-series ([see](https://video.vice.com/en_us/topic/snakeman): “Snakeman”). But Vice has struggled to turn a profit as news-consumption habits shift.

- __Old series:__ Vice's monthly US visitors dropped to 20M in March — just half its audience in 2019. Last week it axed 100 jobs and its flagship “Vice News Tonight” program.

- __New chapter:__ The company says it plans to use the creditors’ cash to keep biz running as usual, while looking for a larger buyout offer to help escape its $800M+ of debt.

__The digi-darling downfall…__ Vice’s bankruptcy follows the unraveling of other digital-native media sites that’ve struggled to keep eyeballs. Last month __[BuzzFeed](https://robinhood.com/stocks/BZFD/)__ closed its news division, and its stock has plunged 90% since its SPAC IPO in 2021. And last week __[Paramount](https://robinhood.com/stocks/PARAA/)__ shuttered MTV News after 36 years on the air. In 2017 __Mashable__ sold for a fifth of its 2016 valuation.

Click

__News go-tos are consolidating views…__ Half of US adults are getting some or most of their news from social media, redirecting precious ad dollars away from digital publishers. While buzzy headlines from Vice and BuzzFeed can rack up likes on social feeds, it doesn’t translate to consistent site traffic. Meanwhile, traditional publishers are holding their weight: __[The New York Times](https://robinhood.com/stocks/NYT/)__ added 1M digital-only subscribers last year, in its second-best year for online subs.

Vice Media goes bankrupt as buzzy digital publishers lose their click status

🥸 *When someone makes a bunch of alt accounts to dominate a Twitter poll…*

On the internet nobody knows you're a dog, or that you're behind the 70 profiles voting #beef in a pet-food company's poll. A "Sybil attack" involves creating numerous accounts to manipulate a system (picture: bots), and it's a long-standing problem in cybersecurity and crypto. Sam Altman's __worldcoin__, which uses eye-scanning orbs to establish a person's uniqueness (and reward them with crypto), is said to be on the verge of [scoring](https://www.ft.com/content/f1de2aee-ee13-45e1-bd61-0a269cd650d3) $100M in funding.

DEFI(NE)

Heard on the Block: "Sybil attack"

Nearly half of Americans eat at least three snacks a day

✈️ Now (not) boarding

__Birkin-shaped Amazon bag…__ #Dupe-tagged videos have billions of views on TikTok, with feeds full of [frugal influencers](https://www.ft.com/content/9609381f-8ad5-4f95-b2b2-2b8b050107d4) unboxing look-alikes — or straight up counterfeits — of designer clothes, bags, and shoes (picture: $75 “Louis Vuitton” slippers). Users have also proudly shared dupes of skincare, makeup, and even toilet paper (“Sharmin”?).

- __Duping = new thrifting?__ Google searches for “dupe” hit a record this year, and “[superfake](https://www.nytimes.com/2023/05/04/magazine/celine-chanel-gucci-superfake-handbags.html?)” handbags have __Reddit__ communities dedicated to finding the perfect Chanel replica.

- __Trending up:__ Last year, 37% of 15- to 24-year-olds surveyed by the EU Intellectual Property Office said they bought at least one fake product. That’s up more than double from 2019.

- __FYI:__ Not all dupes try to pass as designer. But even unbranded look-alikes can cross the legal line (think: mimicking the Birkin shape). 

__Countering counterfeits…__ has gotten tougher as more dupes are sold online (sorry, Canal Street). Many producers are thought to operate out of China, with supply chains set up like “Love Is Blind” pods: sales reps might talk to factories, but details like location are kept secret. It’s estimated that counterfeiters rake in *trillions* annually.

- __Fighting them:__ Designer brands like __Moët Hennessy Louis Vuitton__ (aka: LVMH) spend millions each year taking legal action against counterfeiters. LVMH refused to partner with __[Amazon](https://robinhood.com/stocks/AMZN/)__, saying it doesn’t do enough to take down fakes.

- __Joining them:__ __[Lululemon](https://robinhood.com/stocks/LULU/)__ is hosting “Dupe Swap” events where it replaces customers’ look-alikes of its cult-favorite Align leggings with the bona fide $118 item. #Lululemondupe has 188M views on TikTok.

Playing spot the dupe on TikTok? (Christian Vierig/Getty Images)

Superduper

__Social media has rebranded the copyconomy…__ Viral #baddiesonabudget opting for look-alikes are proud of their frugality, hence the rebrand of “knockoff” to “dupe.” That’s a threat to the *real* luxury market, which has boomed recently as wealthier consumers snatch up price-hiked Prada bags and Rolexes. Last year global luxury sales grew 22% and LVMH reported record sales and profit.

Dupes might be 2023’s biggest shopping trend as social media transforms the copyconomy

__IOU blues…__ On Friday, the Congressional Budget Office said there’s a “significant risk” the US gov’t won’t be able to pay all its bills in June if the debt ceiling isn’t lifted. If lawmakers don’t reach an agreement, the outlook isn’t rosy: Treasury Secretary Yellen predicted an “economic catastrophe,” and __[JPMorgan](https://robinhood.com/stocks/JPM/)__'s CEO said panic could sweep markets. Meanwhile, some are proposing [wacky workarounds](https://sherwoodmedia.com/snacks/newsletters/2pD65Q8aooZgjmKs5sRVfC/articles/73wPYa3nmWgFJby87XMkXK/), including a trillion-dollar coin and using the 14th Amendment to argue the debt limit is unconstitutional (President Biden said he’s considering that one). 

__Refill relief…__ After years of gov’t pressure to lower diabetes drug costs, last week __[Eli Lilly](https://robinhood.com/stocks/LLY/)__ promised the Senate it would stop raising the price of its existing insulin meds. It’s a big deal, since Eli Lilly and its rivals __[Sanofi](https://robinhood.com/stocks/SNY/)__ and __[Novo Nordisk](https://robinhood.com/stocks/NVO/)__ supply 90%+ of the world’s insulin, and *all* of the US’s (#three-opoly). This year, all three announced plans to slash insulin prices, which could provide relief to 8M+ Americans who rely on the lifesaving drug. Companies charge as much as $200/dose, though it can cost less than $10 to make.

Zoom out

Stories we’re watching

__John Deere in the headlights…__ __[Deere](https://robinhood.com/stocks/DE/)__ is expected to report on Friday, and the tractor titan hopes to reap the benefits of a heavy equipment boom that netted competitor __[Caterpillar](https://robinhood.com/stocks/CAT/)__ a 26% profit bump. Deere’s recent moves suggest it’s aiming to be the __[Apple](https://robinhood.com/stocks/AAPL/)__ of agriculture. It’s leaning into software to release techy, self-driving machinery *and* investing in a satellite network to help connect advanced equipment in remote areas of the US and Brazil. By the end of the decade, Deere wants 10% of its revenue to come from software fees. 

__Bananas > blenders…__ Big box behemoths __[Walmart](https://robinhood.com/stocks/WMT/)__ and __[Target](https://robinhood.com/stocks/TGT/)__ are set to report, and the retail picture’s jumbled. Consumers have been cutting back on big-ticket items like TVs, clothes, and blenders, which typically have higher margins. At the same time, Walmart benefited as discount seekers turned to the value seller for groceries and other essentials. But when they last reported, both retailers gave tepid annual forecasts as Americans cut back on discretionary spending. We’ll see later this week if cooling inflation has shaken up those forecasts.

Events

Coming up this week

- __[Huney+](https://sherwoodmedia.com/snacks/newsletters/1UxmY3BSEFwFupcPoRituz/articles/Z5sWGxQTAJQxOndjiQOSi/):__ __[Disney](https://robinhood.com/stocks/DIS/)__ will merge its streamers Disney+ and Hulu into one app as it tries to apply a tourniquet to its cash-bleeding streaming biz. Subscription fatigue has led to similar consolidations by __[Warner Bros.](https://robinhood.com/stocks/WBD/)__ and __[Paramount](https://robinhood.com/stocks/PARAA/)__.

- __[Standby](https://sherwoodmedia.com/snacks/newsletters/2mR6HB0rxS2Ky7HplIKsY8/articles/1ECkqL7snWOkXJF4yK7bYW/):__ After __[Southwest](https://robinhood.com/stocks/LUV/)__'s holiday meltdown, the White House pitched new rules that would require airlines to compensate passengers for flight disruptions *beyond* just refunds (like: hotels, meals, cabs).

- __[Gap](https://sherwoodmedia.com/snacks/newsletters/6J1cMGlepW40UWB5HyrHi6/articles/4CF3ye1tUeS3JDA6JXxPIG/):__ __[Goldman Sachs](https://robinhood.com/stocks/GS/)__ agreed to pay $215M in one of the largest ever gender discrimination settlements. Women made 82 cents on the dollar compared to men last year — only 2 cents more than in 2002.

ICYMI

Last week’s highlights

Most of the light in the universe is invisible to human eyes (think: radio waves, UV rays)

👛 Dupe economy

__The 800-pound streaming gorilla…__ isn’t done bulking up. __[Disney](https://robinhood.com/stocks/DIS/)__ yesterday [announced](https://www.bbc.com/news/business-65553932) plans to marry Disney+ and Hulu into a single mega-streamer sometime this year (our suggested couple name: Huney). The goal: create a “one app experience” so that US bundle subscribers won’t have to toggle between the two. FYI: Disney owns two-thirds of Hulu, and reportedly wants to buy the rest from __[Comcast](https://robinhood.com/stocks/CMCSA/)__. 

- __Losing subs:__ Disney shares fell 9% yesterday after the company’s first-quarter earnings, which featured a surprise loss of 4M Disney+ subscribers.

- __Bleeding cash:__ While theme parks are going strong, Disney’s streaming biz lost $659M last quarter. CEO Bob Iger said another price hike is coming for Disney+’s ad-free tier.

- __Sum of its parts:__ Disney said it will *also* still offer Disney+, Hulu, and ESPN+ as standalone platforms. Combined, they have 231M subs (versus __[Netflix](https://robinhood.com/stocks/NFLX/)__'s 232M). 

__One app to rule them all…__ By bundling its content into one superapp, Disney may hope to boost growth and alleviate streaming fatigue. It’s not alone in its content coagulation push: industry players are combining forces in hopes of standing atop the rubble of the streaming wars. Earlier this year, Paramount+ pulled in Showtime content (new rolls-off-the-tongue name: Paramount+ with Showtime), and last month the world was introduced to Max — the result of a marriage between HBO Max and Discovery+.

The bundle becomes a one-dle (AaronP/Getty Images)

HUNEY

__Consolidation could cure #subscripturation…__ Subscription saturation is real: Americans spend nearly $50/month on video streamers, and are increasingly looking to cut back. Disney’s push to jam diverse content into one offering could be a possible solution. Or, as streamers continue combining (picture: snowballs rolling down a hill), it may inadvertently recreate the cable chaos that subscribers fled in the first place.

Disney plans to merge Disney+ and Hulu as the streaming wars enter the superapp era

__Sunday scaries took a gap year…__ Job satisfaction among US workers reached 62% last year according to a new survey — the highest since analysts began tracking the metric in the late ’80s. Last year the “Great Resignation” saw a record 51M Americans quit their jobs, but the “Great *Reshuffling*” saw workers move to positions with higher pay, more flexible schedules, and better benefits. That may have contributed to a happy(er) workforce.

- __Change-seekers:__ The highest job-satisfaction levels came from people who chose to switch jobs during the pandemic and workers with hybrid schedules.

- __Remote equilibrium:__ Work-life balance and workload were the metrics that saw the biggest #satisfaction jump since 2021. Flexible schedules helped give rise to the “whenever economy.”

- __Drop likely:__ The survey was conducted last fall, before mass layoffs in the tech sector and before many RTO mandates were hardened.

__WFH is down, but not out…__ Currently, about 35% of workers whose jobs can be done remotely are full-time WFHers — down from 2020’s 55%, but up drastically from just 7% prepandemic. While more flexible schedules have boosted happiness, sector leaders like __[JPMorgan](https://robinhood.com/stocks/JPM/)__, Disney, and Amazon want workers to find their joy in IRL conference rooms. Despite almost 30K employees signing a petition against the biz’s three day/week RTO mandate, Amazon in March opted to stick with the directive.

Happy

__Satisfaction not guaranteed…__ While job satisfaction has been rising since 2010, many employees remain locked out of key opportunities that increase happiness. Last year, women reported less satisfaction than men in every benchmark, while 40% of workers in the lowest income quartile had no paid sick or vacation time.

The “Great Resignation” saw US job satisfaction hit a 36-year high, but not everyone’s included

🤖 __Techy…__ A digital artist [launched](https://decrypt.co/139220/meme-coin-speedrun-goes-viral-sparks-scam-concerns) a so-called memecoin in 27 seconds, demonstrating how easy it is to birth a new crypto. Now others are following suit (#speedrun), sparking fears of an incoming token flood.

🤔 __Sus…__ Do Kwon [pleaded](https://fortune.com/crypto/2023/05/11/disgraced-terra-cofounder-do-kwon-pleads-not-guilty-after-hes-arrested-in-montenegro-holding-3-different-passports/) not guilty to charges accusing the former crypto superstar of using forged travel docs. Kwon’s algo [stablecoin](https://sherwoodmedia.com/snacks/newsletters/1alSYApz9fMDqEf8i3IPRi/articles/1vwhQv8VIIqij4eXh9Wsvw/), __terraUSD__, blew up a year ago — erasing $40B in investor value and kicking crypto winter into overdrive.

🍇 __Sour…__ An annual __[bitcoin](https://robinhood.com/crypto/BTC/)__ conference, [Bitcoin 2023](https://www.wsj.com/articles/miamis-love-affair-with-crypto-is-souring-as-bitcoin-faithful-flock-to-the-city-9244f0d9), is set to begin in Miami next week. But some local officials and investors have become disillusioned (think: __FTX__ Arena). Now, Miami’s mayor has reportedly moved on to (you guessed it) AI.

HEAT

The Crypto Catch-Up…

Hollywood’s Covid protocols, which ended yesterday, cost California an estimated $223M

➕ Disney’s streaming superapp

__Payday delayed…__ __[Goldman Sachs](https://robinhood.com/stocks/GS/)__ [agreed](https://www.washingtonpost.com/business/2023/05/09/goldman-sachs-will-pay-215-million-settle-gender-bias-lawsuit/?) to one of the largest settlements ever for a gender-discrimination lawsuit, wrapping up a 13-year-old case weeks before it was set to go to trial. The suit said the investment-banking behemoth paid female vice presidents 20% less than male VPs and called out the bank's performance-review process as favoring men. Goldman’s expected to pay $215M to about 2.8K women (minus legal fees), or around $47K each.

- __More than $$:__ The settlement also requires Goldman to hire an outside expert to look into how it goes about performance reviews, promotions, and pay equity. 

__Wall Street women…__ Goldman’s not the first bank to be accused of shorting its women employees. In 1998, Smith Barney (which became part of __[Citigroup](https://robinhood.com/stocks/C/)__, then __[Morgan Stanley](https://robinhood.com/stocks/MS/)__) paid $150M to 2K women claiming a hostile workplace rife with pay disparity and derogatory language. Not to be left out, __[Bank of America](https://robinhood.com/stocks/BAC/)__ and Morgan Stanley have also settled suits alleging discrimination. 

- __The #s:__ Women made up a record 29% of Goldman’s most recent partner class, and about a quarter of senior leaders are women at Morgan Stanley.

- __Boys’ club:__ Jane Fraser was named Citi’s CEO in 2021, becoming the first woman to lead a major US bank.

Backwards (Michael M. Santiago/Getty Images)

__The gender pay gap is stuck…__ Women made 82 cents on the dollar compared to men last year, which is only 2 cents more than they made *in 2002*. (FYI: female CEOs of S&P 500 companies only recently outnumbered CEOs named “John.”) Meanwhile, a McKinsey report found that companies with more women executives usually outperform those with fewer.

Goldman Sachs settles a $215M gender-discrimination lawsuit that put “boys’ club” culture on blast

__Not sleeping on the job…__ __[Tempur Sealy](https://robinhood.com/stocks/TPX/)__ [agreed](https://www.wsj.com/articles/tempur-sealy-inks-4-billion-deal-for-mattress-firm-12da5d28) to buy __Mattress Firm__ this week in a $4B deal that would combine one of the US’s largest mattress manufacturers with its largest specialty mattress retailer. The acquisition could help firm up two companies and an industry facing sagging post-pandemic mattress demand. If approved, the deal would create a biz with a combined 3K brick-and-mortar stores and 21K employees, and might inspire competitors (like: __[Sleep Number](https://robinhood.com/stocks/SNBR/)__, __[Purple](https://robinhood.com/stocks/PRPL/)__) to follow suit, or risk losing market share to a would-be juggernaut. But it's not all sweet dreams:

- __Counting sheep:__ Antitrust regulators are paying close attention to the deal, which is expected to close late next year.

__Dreamland is open for business…__ and Big Sleep isn’t hitting the hay anytime soon. Merging manufacturing and retail, Tempur Sealy aims to stay at the top of a $100B industry that’s more than just mattress tech and bedding-material science. Close your eyes and see: posture-specific pillows to __Dr. Scholl’s__-ify your head, functional beverages to help you wind down, snoozy podcasts by __Calm__ and __Audible__ to lull you into a slumber, and trackers to help you catch the best z's.

G’night

__Peak REM-fficiency is always just around the corner…__ 40% of surveyed adults said their sleep quality decreased during the pandemic, while 55% listed getting good sleep as a major priority. A rise in “sleep tourism” — aka: hotels and spas promoting rest-focused rooms and amenities — suggests sleep searchers are willing to pay for the pleasure. High up on bedtime optimizers' list: a lasting mattress.

Tempur Sealy makes a deal to buy Mattress Firm for $4B as the sleep industry shows no sign of slumber

US airlines made nearly $7B last year from checked-baggage fees

🏦 Goldman pays up

__11th-hour dramatics…__ with the largest economy on the line. President Biden and House Speaker McCarthy met yesterday to discuss the debt ceiling, which the government could hit as soon as June 1. If elected officials fail to reach an agreement, Treasury Secretary Yellen predicted an "economic catastrophe." Now, instead of waiting on budget consensus, experts are [proposing](https://finance.yahoo.com/news/trillion-dollar-coin-14th-amendment-some-argue-for-far-out-fixes-to-the-debt-ceiling-crisis-172042092.html) alternative solutions so that the US can keep paying its bills:

- __Pocket change:__ #MintTheCoin proponents — including legal scholars and pundits — argue that the Treasury could mint a single trillion-dollar coin. *Poof:* $$ problems gone.

- __Not your parents' bonds:__ Nobel Prize-winning economist Paul Krugman said the US could issue “premium bonds,” which would have higher interest rates and could theoretically be sold at above face value.

- __Constitution check:__ When all else fails, ignore it? Some say that the 14th Amendment renders the debt ceiling unconstitutional. 

__Yellen for a solution…__ Janet Yellen said it's unlikely the Fed would accept a trillion-dollar coin, and even fans of the premium-bond play say it could run into legal speed bumps. But if officials don't reach an agreement to raise (or suspend) the ceiling, the Treasury could be forced to decide which bills to pay. Picture: interest still paid on Treasury securities, but paused Social Security checks and delayed federal-contractor payments. Meanwhile, the White House warned that a protracted default could lead to millions of job losses, plunging stock values, and an "immediate" recession.

Imagining a world with a trillion-dollar coin (Stefani Reynolds/Getty Images)

MINT

__Stale problems create space for fresh fixes…__ This is far from the first time officials have played debt-ceiling chicken (or that a trillion-dollar coin's been pitched). But it could be the first time the US intentionally defaults on its debt. A last-minute deal is still on the table, but barring a bipartisan resolution, seemingly out-there solutions could gain traction.

With the US debt ceiling fast approaching, wacky workarounds enter the chat

__Sensitive content…__ Graphic images showing victims of the deadly shooting at a Texas mall began [circulating](https://www.nytimes.com/2023/05/07/business/media/texas-shooting-video-twitter.html?utm_source=substack&utm_medium=email) on __Twitter__ over the weekend, and some content was still up on Monday. The content is against Twitter’s stated policies prohibiting “gratuitous gore,” specifically “dismembered or mutilated humans.”

- __Twitter’s problem:__ NYT journalist Benjamin Mullin said the images were “less prominent” on Facebook, Instagram, and YouTube, and searches on those platforms mostly surfaced news articles and less sensitive eyewitness content. Meanwhile, Twitter users said the images flooded their feeds. 

__Under Elon’s reign…__ Musk has made sweeping changes to Twitter since becoming CEO, including affecting the platform’s ability to moderate content with algorithms *and* with humans catching sensitive material that gets into users’ feeds. 

- __Missing moderators:__ While __[Meta](https://robinhood.com/stocks/META/)__ and YouTube have invested heavily in hiring large teams of moderators, Twitter laid them off as part of mass cuts initiated by Musk. Last month, the EU told Twitter it needed to hire more moderators to comply with a new set of digital safety rules.

- __Technical tweaks:__ Users who pay for a premium (checkmark) Twitter subscription get their content algorithmically prioritized above free accounts, and users say that’s helped surface images of the shooting, especially in the “For You” feed added in January.

Safety

__Not all costs are cuttable…__ Musk has focused on steep cost cuts (including selling Twitter HQ’s furniture) and revenue-boosting initiatives (like subscriptions) to revive Twitter’s finances. But the rapid belt-tightening may’ve missed a notch somewhere. The company’s revenue reportedly plummeted 40% from December 2021 to last year, mainly because of advertisers exiting the platform en masse… largely over content moderation.

Graphic images from the Texas mall shooting got past Twitter moderation, drawing criticism

Old-school check-fraud nearly doubled last year from 2021, with banks filing 680K reports

🪙 A trillion-dollar coin

__Hold music…__ not the tune you were expecting on your relaxing getaway. After __[Southwest](https://robinhood.com/stocks/LUV/)__'s holiday meltdown, which saw the airline cancel 16K flights, the White House wants to keep companies accountable for passengers' troubles. Yesterday, President Biden joined Transportation Secretary Buttigieg to propose new regulations. For the first time, airlines would need to compensate customers *beyond* just ticket refunds.  

- __Fly bad, my bad:__ Airlines would be required to compensate passengers *and* cover their meals, hotels, and taxis if they get stranded for reasons that are the airline’s fault.
They’d also be required to comp rebooking fees for delays/cancellations.

- __Flight status quo:__ Right now airlines are required to refund customers only for canceled flights (not delayed ones). Biden said no major airlines provide cash compensation for preventable disruptions — though nine promised to cover hotels, meals, and rebooking. 

__Dude, where’s my plane…__ Weather is the top cause of flight delays, but avoidable issues like staffing shortages and technical problems caused by outdated systems led to abnormally high disruptions last year, even when skies were clear. A technical error at Southwest last month caused it to temporarily halt all US departures. Meanwhile, the Transportation Department is investigating whether Southwest set unrealistic flight schedules despite known staffing shortages.

Refund requested (Seth Herald/Getty Images)

Standby

__A nudge in the wings could be overdue…__ If airlines have to compensate passengers more for disruptions, they might try harder to avoid delays. Southwest says it lost $1.1B because of the holiday meltdown, but it would’ve lost even more with these proposed regulations. It’s not just Southwest: last year 2.7% of all US flights were canceled, the highest rate in a decade (apart from 2020). The TSA’s expecting a record-breaking travel year on booming summer demand, but staffing shortages and delays of __[Boeing](https://robinhood.com/stocks/BA/)__ jet deliveries could mean more headaches.

Ahead of summer, Biden proposes rules to compensate passengers for airline disruptions

__Got beef?...__ __[Tyson](https://robinhood.com/stocks/TSN/)__ shares had their worst drop in a decade yesterday after the poultry powerhouse badly [missed](https://www.wsj.com/articles/tyson-tsn-q2-earnings-report-2023-c824e501) earnings expectations and chopped its annual sales forecast. It produces one of every five pounds of chicken, beef, and pork eaten in the US. But last quarter the nugget giant lost nearly $100M, down from an $829M profit last year. 

- __Bad meat:__ Tyson's beef unit makes up nearly 40% of its annual revenue, but sales fell 8% last quarter as cash-strapped consumers cut back on the pricey protein.

- __Cold wings:__ Tyson's chicken biz also saw its profit margins shrink as the cost of animal feed rose $145M.

__Farming snafus…__ The meat industry has gotten grilled as recent droughts and pricey farming costs (think: fertilizer, feed, fuel) make it harder to maintain livestock. Tyson said its live cattle costs are up $305M from last year. Now some farmers are selling their animals for slaughter at premium prices because keeping them is too expensive. Meanwhile, falling demand for beef is making it harder for producers like Tyson to pass on higher costs to consumers.

Beef

__Dry spells can change appetites…__ US cattle inventory has already dropped more than 3% from last year, and over 90% of cows are in poor-to-fair grazing conditions. The USDA predicts this year will mark the first decline in beef production since 2015, and the per-person supply is expected to drop by 5.6% this year, which would be the greatest decline since 1987. Supply challenges could accelerate the trend of declining demand for red meat in the US, the world’s largest beef consumer.

Tyson posts a meaty loss as rising costs and cattle shortages take a bite out of profits

🙄 *Like rolling your eyes instead of engaging…*  

“FUD” is a catchall term used to dismiss crypto criticisms (substantive or not) by saying they're intended to spread “fear, uncertainty, and doubt.” Over the weekend, __Binance__ twice paused __[bitcoin](https://robinhood.com/crypto/BTC/)__ withdrawals, blaming high network fees. When observers saw that other exchanges hadn't paused withdrawals, which to some suggested there could’ve been a problem at the world's largest exchange, Binance CEO Changpeng “CZ” Zhao called the concerns “[FUD](https://fortune.com/crypto/2023/05/08/binance-pauses-bitcoin-withdrawals-fee-spikes-cz-fears-fud/).”

Heard on the Block: "FUD"

King Charles’ coronation is estimated to have cost as much as $125M

✈️ Airline delay payday

__Bots on the hill…__ VP Kamala Harris [met](https://www.reuters.com/technology/white-house-meet-microsoft-google-ceos-ai-dangers-2023-05-04/) last week with the bosses of __[Alphabet](https://robinhood.com/stocks/GOOGL/)__, __[Microsoft](https://robinhood.com/stocks/MSFT/)__, __OpenAI__, and __Anthropic__ as AI innovation draws greater scrutiny in DC. The White House said AI developers are expected to have their products reviewed at August’s Defcon cybersecurity conference, and debuted a $140M plan to build AI-research hubs. As large language models (LLMs) like ChatGPT go mainstream, Washington says companies have an “ethical, moral, and legal” responsibility to ensure their tech is safe. A few concerns:

- __Data privacy:__ There are worries LLMs could leak sensitive user data they collect. Last week __Samsung__ barred its staff from using ChatGPT after a leak.

- __Misinfo:__ LLMs are known for spewing false or biased info. Governments are concerned bad actors could use LLMs to spread propaganda.

- __Copyright:__ Legal issues have emerged over AI-related infringement, from cover art to fake Drake songs. It’s also an element of the recent WGA strike: writers worry that studios could use their scripts to churn out AI-generated stories without them.

- __Plagiarism:__ Teachers are concerned, too, as students lean on LLMs for homework. Last week __[Chegg](https://robinhood.com/stocks/CHGG/)__ shares fell 40%+ after the edu-tech company noted a spike in students flocking to ChatGPT.

__Workin’ 9-to-AI…__ Another trigger of AI-anxiety: job security. Last week __[IBM](https://robinhood.com/stocks/IBM/)__ froze hiring for nearly 8K roles that it said could be replaced by AI, and said the tech could replace almost a third of its non-customer-facing roles. By some estimates, 300M jobs could be affected by AI, while __[Goldman Sachs](https://robinhood.com/stocks/GS/)__ estimates it could boost global GDP by 7%.

Regulation loading… (Lionel Bonaventure/Getty Images)

Learning

__With great tech comes great responsibility…__ From fake Drake to fake news and AI-fueled propaganda campaigns, the risks of unregulated AI are clear. As major companies start to integrate the tech into products that billions of people use (like: search engines), we can expect governments to get involved in regulating it. But the rapid innovation means it could be harder to move responsibly.

As AI anxiety spreads, Washington pressures Big Tech CEOs to ensure their products are safe

__On to the next one…__ __[JPMorgan Chase](https://robinhood.com/stocks/JPM/)__ CEO Jamie Dimon said last week that "this part" of the banking crisis is over after America’s largest bank took over __First Republic__ (the second-largest US bank failure ever). Later, regional-bank shares plunged on concerns over __[PacWest](https://robinhood.com/stocks/PACW/)__: like other recently flopped banks, it has lots of uninsured deposits (aka: accounts over $250K). Last week the FDIC [proposed](https://www.nytimes.com/2023/05/01/business/fdic-bank-insurance-proposals.html) broadening deposit insurance for businesses, which could prevent more SVB-style bank runs. If you know your deposit is safe, you’re less likely to panic. 

__Mining your business…__ The White House pitched a 30% tax on crypto miners' electricity usage in a stated bid to blunt the industry's environmental impact. (FYI: Last year US miners used as much energy as TVs). But according to crypto cos like __[Riot](https://robinhood.com/stocks/RIOT/)__ and __[Marathon Digital](https://robinhood.com/stocks/MARA/)__, the tax could drive business overseas. The proposal follows a brutal year for miners (picture: plunging crypto prices, soaring energy bills) that saw several file for bankruptcy, and comes just as __[bitcoin](https://robinhood.com/crypto/BTC/)__ regains steam. The OG blockchain saw record transactions just last week.

Zoom Out

__Hyrule hype…__ __[Nintendo](https://robinhood.com/stocks/NTDOY/)__ is (finally) dropping its newest Zelda game, “Tears of the Kingdom,” this Friday. The much-hyped title is expected to boost sales of the popular Switch console, which paraglided past the newest __Microsoft__ Xbox and __[Sony](https://robinhood.com/stocks/SONY/)__ PlayStation to become the third-best-selling console ever. Nintendo’s said to be ramping up Switch production to meet Zelda fans’ desire to cook Salmon Risotto in the Gerudo Desert. The industry’s growth slowed when players went IRL after quarantine, but gaming demand’s still hot.

__PSA: Mother’s Day is *this* Sunday…__ But working moms still face a “motherhood penalty.” After millions of women left jobs during the pandemic to shoulder childcare duties, 1M mothers have reentered the workforce since the end of 2021, and last year’s labor-force participation rate for mothers *surpassed* the prepandemic rate. But biases around job productivity and commitment contribute to an $18K/year pay gap between US mothers and fathers. Studies say the lifetime earnings loss that moms experience is the most significant factor driving the gender pay gap.

- __[Gargle](https://sherwoodmedia.com/snacks/newsletters/numAk0mhDTcZBec3v72RW/articles/4q7zgE3uzZB7GqEDUE0jXk/):__ __[J&J](https://robinhood.com/stocks/JNJ/)__'s consumer spinoff, __[Kenvue](https://robinhood.com/stocks/KVUE/)__ (think: Tylenol, Neutrogena), had the largest US IPO since 2021. The $3.8B raise stands out in a dry IPO market: before Kenvue, US-listed companies raised $4B this year versus $155B in 2021.

- __[Cord](https://sherwoodmedia.com/snacks/newsletters/38nZhlyyAE4Ped90y3nNQD/articles/D8FC2cOb7KIuN4na6XWf1/):__ __[Disney](https://robinhood.com/stocks/DIS/)__'s __ESPN__ may get the final say on cable’s lifespan. The network said it’ll eventually move its full TV offerings over to its streamer ESPN+. But it’s having trouble cutting the cord since TV earns more $$.

- __[Haul-ted](https://sherwoodmedia.com/snacks/newsletters/38nZhlyyAE4Ped90y3nNQD/articles/3VA8cWnVodXacHUQZWNPoK/):__ Fast-fashion hit __Shein__ wants to IPO this year, but US lawmakers are urging the SEC to halt that plan until Shein’s labor practices are audited to show its clothes aren’t made using forced labor.

Last week's highlights

60% of workers are employed in professions that didn’t exist in 1940

🤖 AI meets DC

__Medical milestone…__ 60+ years after it was discovered, respiratory syncytial virus, or RSV, finally has a vaccine. The FDA [approved](https://www.bloomberg.com/news/articles/2023-05-03/first-vaccine-caps-60-year-search-to-stem-pervasive-lung-virus) __[GlaxoSmithKline](https://robinhood.com/stocks/GSK/)__'s Arexvy (named to sound like “RSV”) vaccine on Wednesday, and the shot could go on sale within weeks.

- __Life-saver:__ RSV is a potentially life-threatening respiratory infection that affects mostly young kids and older adults. It’s the leading reason young children are hospitalized in the US, and 160K+ people die from RSV globally each year.

__Pharma frenzy…__ Four other RSV vaccines are on track to land on pharmacy shelves this year. Analysts predict that the shot’s market could be worth $10B by 2032, and GSK expects to earn as much as $3.7B in Arexvy sales. The London-based company may’ve crossed the RSV finish line first, but other Big Pharma titans are close behind. 

- __Jabbing competition:__ __[Pfizer](https://robinhood.com/stocks/PFE/)__'s RSV vaccine is up next, with FDA approval expected this month. And __[AstraZeneca](https://robinhood.com/stocks/AZN/)__, __[Sanofi](https://robinhood.com/stocks/SNY/)__, and __[Moderna](https://robinhood.com/stocks/MRNA/)__ all have shots in the works.

- __Audience overlap:__ Pfizer’s first RSV vax and GSK’s are both tailored to people over 60, as is Moderna’s (whenever it’s ready), which could lead to a marketing showdown.

New vaccine alert (Pavlo Gonchar/Getty Images)

__Covid accelerated the vax race…__ Pharma companies are racing to be first to the next big vaccine. Since no one was “Team GSK” for Covid (it made a booster only late last year), GSK has ground to cover. But since it already makes a leading shingles vaccine, nabbing the RSV market could give it greater vax dominance. Meanwhile, Moderna and Pfizer are exploring new products to offset slipping demand for Covid vaccines. Moderna reported its first quarterly profit yesterday, but its sales were down by more than $4B, since the Covid vax is the only product it sells.

The first RSV vaccine gets approved as pharma bigshots race into the $10B market

__And the biggest IPO of the year is…__ Tylenol? This week, __[Johnson & Johnson](https://robinhood.com/stocks/JNJ/)__'s spun-off consumer arm, __[Kenvue](https://robinhood.com/stocks/KVUE/)__, became the largest IPO in the US in nearly 18 months. Kenvue, which makes bathroom-cabinet staples like Listerine, Neutrogena, and Benadryl, was [valued](https://www.ft.com/content/c04534a2-8227-4f6d-966e-0e7140645ea0) at $41B on Wednesday. Shares surged 20% yesterday after it started trading on the NYSE, suggesting there’s an appetite for the already profitable, dividend-paying biz (aka: not your typical IPO). 

- __New name, same boss:__ Initially, J&J will own more than 90% of Kenvue shares, with plans to reduce its stake.

- __Old problems:__ J&J’s consumer biz has faced ~40K lawsuits alleging its talc products contained cancer-causing substances. Last month J&J offered $9B to settle. 

__Like swallowing Tylenol without water…__ The IPO market is *dry*. Kenvue's blockbuster listing stands out in an otherwise anemic environment, as rising rates and recession fears spook companies from entering US markets. So far this year, US-listed companies have raised only $4.1B (*not* including Kenvue). That's a far cry from the IPO-palooza of 2021, which saw companies raise $155B. Elsewhere, Asian listings have picked up recently.

Lotion

__Smaller can be stronger…__ J&J is just the latest biz to hop on the #simplify trend. Last year, cereal star __[Kellogg](https://robinhood.com/stocks/K/)__ said it [planned](https://sherwoodmedia.com/snacks/newsletters/1Qt2T96PxTPi4D1SE8Gee4/articles/5MZFe6N5PC1XczpsPaEX9z/) to break into *three* pure-play companies (Snap, Crackle, and Pop?) and __[GE](https://robinhood.com/stocks/GE/)__ announced a similar move in 2021. Splitting up massive conglomerates allows the newly formed businesses to focus on narrower priorities and streamline operations, with the goal of boosting profits.

J&J’s consumer spinoff was the biggest IPO since 2021, showing the value of a breakup

🤖 __Techy…__ The __[bitcoin](https://robinhood.com/crypto/BTC/)__ blockchain saw a [record](https://markets.businessinsider.com/news/currencies/bitcoin-record-daily-transactions-network-ordinals-protocol-cryptocurrency-btc-crypto-2023-5) 682K+ transactions on Monday, and over half of those were [ordinals](https://sherwoodmedia.com/snacks/newsletters/hVxJ5P0UXNj7GiarHRYHR/articles/6h6QfaEiiWIYYTVHHiqAf/). Since their introduction earlier this year, the bitcoin NFTs have surged in popularity. 

📜 __Policy…__ The Biden admin [proposed](https://news.yahoo.com/biden-proposes-30-climate-change-tax-on-cryptocurrency-mining-120033242.html) a tax on crypto miners equal to 30% of their electricity costs. Mining giant __[Riot](https://robinhood.com/stocks/RIOT/)__ suggested the tax could drive companies overseas, and have *negative* environmental effects. 

🪙 __Coins…__ __Pepecoin__, a crypto inspired by a controversial frog cartoon, saw $250M in 24-hour trading volume this week, [passing](https://www.coindesk.com/markets/2023/05/03/pepecoin-overtakes-dogecoin-shiba-inu-trading-volumes-as-early-buyers-take-profits/) fellow memecoins __[doge](https://robinhood.com/crypto/DOGE/)__ and __[shiba inu](https://robinhood.com/crypto/SHIB/)__. Meanwhile, pepe [whales](https://sherwoodmedia.com/snacks/newsletters/5Bc8UtrBrzT79KtNoIOah7/articles/5L3CPfHWE8wkemrresjRY5/) sold off huge amounts of the token.

WHALES

Nearly half of YouTube viewership in the US is on TVs

💉 The new vaccine race

__Loading up the F-150…__ __[Ford](https://robinhood.com/stocks/F/)__'s famous truck has been the best-selling vehicle in America for nearly a half century, and it didn’t disappoint last quarter either. The auto OG just [unloaded](https://www.cnbc.com/2023/05/02/ford-motor-f-earnings-q1-2023.html) expectation-smashing results, led by its old-school passenger cars and commercial-fleet vehicles like delivery vans. While Ford’s EV biz racked up hefty losses, strong earnings from the legacy divisions let the Michigan automaker drive home a $1.8B profit. 

- __Ford Model E:__ Its electric division lost more than $700M, and the company expects it’ll lose $3B this year. FYI: this is the first quarter Ford started breaking out EV results.

__“Take my [Ford] to the Old Town Road”…__ and make it electric. While gas trucks are Ford’s profit poodles, it isn’t skimping on its e-aspirations. It said it would boost spending on EVs to $50B through 2026, with plans to churn out 2M+ EVs/year by then. Last year Ford sold 61K+ EVs in the US, making it America’s #2 best-selling EV maker after __[Tesla](https://robinhood.com/stocks/TSLA/)__. But it sold only 12K EVs last quarter, and sales of its electric Mustang were down 20%. This week it also slashed the Mach-E’s price for the second time this year.

Who’s a good Ford? (Bill Pugliano/Getty Images)

Juicy

__Being boring can help you be buzzy…__ Ford’s “boring” legacy cars are bankrolling its money-losing EV ambitions. CEO Jim Farley said Ford is “boringly predictable when it comes to execution and delivering financials, but extremely ambitious in… creating the Ford of the future.” Its gas-car biz could sustain the company until the EV side is profitable, giving it an advantage over pure-play EV rivals. This week, e-truck startup __[Lordstown Motors](https://robinhood.com/stocks/RIDE/)__ warned it could go bankrupt, while the likes of __[Rivian](https://robinhood.com/stocks/RIVN/)__ and __[Lucid](https://robinhood.com/stocks/LCID/)__ are struggling.

Ford crushes earnings expectations as trusty trucks offset major EV losses

__$200 rental, $100 cleaning fee…__ Yesterday __[Airbnb](https://robinhood.com/stocks/ABNB/)__ [rolled](https://www.bloomberg.com/news/articles/2023-05-03/airbnb-revamps-site-to-ease-tensions-between-guests-hosts) out dozens of new features and upgrades to keep travelers checking in this summer. The rental rockstar has 4M+ hosts worldwide and expects 300M guests this year. But complaints have piled up as hidden fees and high prices make booking frustrating. Now:

- __Price check:__ Airbnb rentals will display the cost per night, fees, *and* taxes all at once. Plus, guests in the US and Canada can start using __Klarna__ to buy now, pay later for stays over $500.

- __Couchsurf:__ A "Rooms" option lets budget-conscious travelers stay with hosts at an average rate of $67/night. “Host Passports” will display fun facts (see: WFH cat mom).

- __King-size:__ Airbnb dropped record earnings in February, notching its first profitable year, and is forecasting even stronger results this year. 

__Check-in and chores…__ Airbnb booking surged during the pandemic as it benefited from the remote “work from anywhere” trend. But a flood of users on social media and forums like __Reddit__ complain about pesky chores (see: vacuuming, dishes) coupled with sometimes staggering cleaning fees. Now, as travel recovers and guests get pickier about perks, good ol’ hotel chains are starting to catch up.

- __Continental breakfast:__ Last quarter, __[Marriott](https://robinhood.com/stocks/MAR/)__'s revenue surged 34% as occupancy jumped at all its North American properties. __[Hilton](https://robinhood.com/stocks/HLT/)__ also topped estimates, with its revpar (aka: revenue per available room) topping prepandemic levels for the first time.

Booked

__Convenience isn’t always convenient…__ While Airbnb can offer more flexible prices and broader options than hotels, the fine print can make booking more trouble than it's worth. Meanwhile, traditional hotel chains offer the comfort of consistency (think: cleaning, room service) and rewards programs that incentivize loyalty. By addressing its users' qualms, Airbnb can avoid getting ditched for better options.

Airbnb revamps price displays to quell frustration as summer travel (and hotel competition) heats up

The McDonald’s app was downloaded more times last year than Uber, Tinder, or Starbucks