__One-two contagion punch…__ As the crypto industry reels from __FTX's__ [collapse](https://snacks.robinhood.com/newsletters/2jedAlq0iN3kyZjhRJ7QXZ/articles/1enAKmQ2NnWWzq409J1MHk/), the billion-dollar question is, who might be next? We may know soon, as __BlockFi's__ [reportedly](https://www.bloomberg.com/news/articles/2022-11-16/blockfi-said-to-plan-imminent-bankruptcy-filing-amid-ftx-fallout) planning to file for bankruptcy. The crypto lender, which held nearly $4B in customer assets, paused withdrawals this month, citing "significant exposure to FTX." It also had loans out to __Alameda Research__, FTX's so-called sister firm. It's not the first time contagion’s come for BlockFi:

- __Terra-part:__ The TerraUSD stablecoin [melted down](https://snacks.robinhood.com/newsletters/CZLtSSO02dkWUNfYSsz7D/articles/40vJyepmLGsyVSkxrAJx2M/) in May, wiping out $40B in investor value. The resulting chaos felled crypto hedge fund __Three Arrows Capital__ (3AC), which in turn threatened BlockFi, which had made loans to 3AC.
- __FTXtra Life:__ BlockFi was saved partly by a $400M credit line from FTX. Now FTX might be its undoing. 

__FTX's bankruptcy is a powerful blow…__ because crypto is a highly leveraged industry (think: using borrowed assets to make trades). That causes ripple effects when big players fall. __Liquid__, an exchange that FTX acquired this year, froze withdrawals last week. Crypto lender __Genesis__ suspended new loans and redemptions. __Gemini__, the Winklevoss-helmed exchange that used Genesis to offer a yield product, also paused some redemptions. Retail exchange Genesis Block said on Friday that it would cease trading. And there's fear contagion could spread even further:

- __Crypto.com__ (picture: Matt Damon Super Bowl ads, Lakers’ stadium-naming rights) tried to reassure investors it would not follow FTX. 
- __Nine exchanges__ now say they'll offer up "[proof of reserves](https://snacks.robinhood.com/newsletters/2jedAlq0iN3kyZjhRJ7QXZ/articles/5LZm0DXxBdnT4jdK7CApd8/)" to show they still have customers' assets.

Coin-tagion (Chesnot/Getty Images)

Sneeze

__Contagion thrives because crypto's interwoven…__ with leverage as the thread. If a crypto lender or exchange lends its customers' assets to a hedge fund (like: 3AC or Alameda), which then uses those assets to generate yield (aka: earn crypto interest) and make potentially risky bets… one wobbly domino risks toppling the whole lot. FTX’s bankruptcy isn’t the end of this story: __Binance__ CEO Changpeng “CZ” Zhao says he’s "very worried" about some forms of crypto leverage — and [regulators](https://snacks.robinhood.com/newsletters/5vc5yehi8D6UyFME7P6v6r/articles/u28ZR9jrs0HLSaD0qErHN/) are on high alert.

FTX “contagion” spreads, highlighting the crypto industry's interdependence

__“Power casual” [Lulu](https://robinhood.com/stocks/LULU/) fit…__ Workers are slowly returning to offices, and there’s less room for __[Zoom](https://robinhood.com/stocks/ZM/)__. While office occupancy is still lower than prepandemic, 88% of employers are offering workers incentives to return IRL. The number of workers returning to cubicles is rising, and 9 in 10 companies surveyed said they planned to require workers in offices (at least part time) by 2023. That hurts pandemic powerhouses like Zoom, which reports today. Last quarter it cut its sales forecast as growth majorly slowed from the pandemic Zoom boom.

__Forks up, sweatpants on…__ wallets out. Thanksgiving is on Thursday, but grocery prices are already eating into budgets. A third of Americans plan to spend less on their feasts this year, with the average meal for 10 hitting $64, up 20% from last year. Turkey is up 21% while stuffing mix has soared 70%. Some retail giants are gaining customers by keeping prices (relatively) low: __[Walmart](https://robinhood.com/stocks/WMT/)__ says it’s keeping Thanksgiving meal prices the same as last year, and more higher-income shoppers turned to the retailer last quarter for discounts.

Events...

Coming up this week

__Ready for flu szn…__ As Americans look for easily accessible healthcare, retailers are racing into the industry. Last week __[Amazon](https://robinhood.com/stocks/AMZN/)__ launched its first virtual healthcare clinic to treat patients for everything from allergies to acne. Amazon also agreed to buy clinic chain __[One Medical](https://robinhood.com/stocks/ONEM/)__ in July. Last year, __[Walgreens](https://robinhood.com/stocks/WBA/)__ took a $5B stake in VillageMD and is now opening an average of one clinic every three days. Meanwhile, __[CVS](https://robinhood.com/stocks/CVS/)__ has grown its HealthHUBs, where shoppers can meet with medical pros in stores. Retailers could help capture 30% of the primary-care market by 2030. 

__Credit cards are red hot…__ because swiping is *soaring*. Card balances rose 15% last quarter from last year — the fastest jump in two decades — as cash-strapped shoppers leaned on plastic for inflated expenses. But as the Fed hikes rates, IOUs have gotten pricier: some cards have interest rates of 30%+ (translation: a $1K purse would cost $700+ in annual *interest* if you didn’t pay off the full balance on time). With 60% of Americans now living paycheck to paycheck, historically low delinquency rates are starting to rise.

Zoom Out

Stories we’re watching...

- __[Swift](https://snacks.robinhood.com/newsletters/5vc5yehi8D6UyFME7P6v6r/articles/5r2wLR5a5WqbnjdLLxxeP4/):__ T-Swift’s world tour crashed Ticketmaster as millions of fans (and resellers) rushed to the __[Live Nation](https://robinhood.com/stocks/LYV/)__-owned platform. Swifties may have bad blood, but Live Nation’s music dominance makes it hard to escape. 
- __[Hunt](https://snacks.robinhood.com/newsletters/2mdUwkwlkcBgMX8vZOTUP/articles/3bE3btkX7UxXzJSURZiUif/):__ As more shoppers “treasure hunt” for bargains, discount retailers like Marshalls owner __[TJX](https://robinhood.com/stocks/TJX/)__ and __[Ross](https://robinhood.com/stocks/ROST/)__ are humming along — while mid-tier (not discount, not luxe) chains like __[Target](https://robinhood.com/stocks/TGT/)__ and __[Kohl’s](https://robinhood.com/stocks/KSS/)__ suffer. 
- __[3BR](https://snacks.robinhood.com/newsletters/2mdUwkwlkcBgMX8vZOTUP/articles/3YKml8vvfQzRLMGQotIps4/):__ As wild mortgage rates and prices depress home-buying demand, __[JPMorgan](https://robinhood.com/stocks/JPM/)__ said it’ll build $1B worth of single-family homes for renters. With mortgage revenue down, JPM hopes to capitalize on the “rent-aissance.”

ICYMI

Last week's highlights...

Dow Jones

S&P 500

Nasdaq

Bitcoin

Federally owned Amtrak hasn’t earned a profit in its five-decade history

🦠 Crypto contagion

__Found a $30 [Michael Kors](https://robinhood.com/stocks/KORS/) bag…__ under a shoe rack. __[TJX](https://robinhood.com/stocks/TJX/)__ — the discount retailer behind TJ Maxx, Marshalls, and HomeGoods — is humming along as consumers scour its aisles for cute deals. This week, TJX beat quarterly sales expectations and boosted its outlook, because there’s no better feeling than finding perfectly fitting __[Levi’s](https://robinhood.com/stocks/LEVI/)__ for $11 after hours of scavenging. 

- __The “exciting treasure-hunt shopping experience”__ is still resonating, TJX’s CEO said. Same-store sales at Marshalls and TJ Maxx were up 3%. And while the S&P 500 is down nearly 18% for the year, TJX stock is also up 3%.
- __Dress for less:__ Yesterday, rival rack-rummaging destination __[Ross](https://robinhood.com/stocks/ROST/)__ also delivered better-than-expected results, despite declining sales and profit. Shares popped 13% after it issued higher-than-anticipated guidance for the holidays.

__It’s the “affordable splurge” vibes for me…__ and the unaffordable splurge for others. While discount retailers are banking on low prices, luxury retailers are enjoying resilient demand. Bloomingdale’s owner __[Macy’s](https://robinhood.com/stocks/M/)__ raised its annual profit forecast as higher-income shoppers scooped up designer blazers and fancy beauty products. Macy’s isn’t the paragon of luxury, but it does stock more luxe goods than department rivals like __[Kohl’s](https://robinhood.com/stocks/KSS/)__. Interestingly: 

- __While Macy’s same-store sales were down__ for the quarter, its higher-end brands grew. Bloomingdale’s revenue was up 5%. Meanwhile…
- __Its luxury beauty retailer, Bluemercury,__ enjoyed *14%* sales growth as shoppers splurged on pricey serums and designer foundations.

The unmatched thrill of bargain-hunting (Chip Somodevilla/Getty Images)

Hunt

__The middle is an awkward spot…__ during an economic downturn. Lower- and middle-income consumers are moving downmarket to discount retailers like TJX and __[Walmart](https://robinhood.com/stocks/WMT/)__, while wealthier consumers are sticking with luxury brands. Meanwhile, more middle-of-the-road retailers are hurting: this week Kohl’s withdrew its annual forecast after sales fell 7% and __[Target](https://robinhood.com/stocks/TGT/)__ cut its holiday outlook as demand slackened.

As more shoppers bargain-hunt, TJ Maxx and Marshalls grow while “in-between” retailers suffer

__Big Banks join the rent-aissance…__ Fewer people are buying houses, so banks are shifting their focus from home loans to rental properties: this week __[JPMorgan](https://robinhood.com/stocks/JPM/)__ [said](https://www.bloomberg.com/news/articles/2022-11-15/jpmorgan-forms-new-joint-venture-for-1-billion-in-rental-houses) it’s teaming up with property giant __Haven Realty Capital__ to build $1B worth of single-family homes for renters. As US homes sales continue sliding, JPM is preparing for a rental surge:

- __Bettin’ on the ’burbs:__ JPM and Haven plan to buy 250 “built to rent” homes in the Atlanta area, and then develop entire communities of new suburban rental homes.
- __Renting, revamped:__ Last month, JPM started testing a platform that aims to help landlords digitize monthly rental payments — 78% of which are still paid by check. 

__Renting is the new buying…__ because many can’t afford to buy right now. Mortgage rates have more than doubled in the past year, making the long-term cost of homeownership prohibitive for many. While banks are earning higher interest, mortgage demand has plunged 40% from a year ago.

- __It’s bad for buyers…__ *and* for banks: JPM issued $15B of mortgage loans last quarter — 46% less than a year ago. JPM laid off mortgage workers this year as slumping revenue dented profits.
- __Rival [Wells Fargo’s](https://robinhood.com/stocks/WFC/)__ mortgage volume has fallen 90% since last year, and it’s also laid off mortgage workers. __[Rocket Mortgage](https://robinhood.com/stocks/RKT/)__, __[Redfin](https://robinhood.com/stocks/RDFN/)__, and __Better.com__ have also cut staff, and some mortgage startups have gone bankrupt.

__It pays to be pragmatic…__ JPM could capitalize on America’s housing-affordability crisis by capturing a new generation of renters. Builders first popularized the build-to-rent model during the Great Recession as a way to keep building even when people weren’t buying. Now builder confidence is at its lowest level since 2012, thanks to soaring rates and construction material costs. By shifting strategy banks could see another build-to-rent boom.

JPMorgan invests $1B in rental homes as pricey houses kick off an American rent-aissance

- __🧹Messy…__ Former __FTX__ CEO Sam Bankman-Fried apparently cursed regulators in a DM-based [interview](https://www.vox.com/future-perfect/23462333/sam-bankman-fried-ftx-cryptocurrency-effective-altruism-crypto-bahamas-philanthropy) with Vox and said his "biggest" mistake was filing for bankruptcy. Meanwhile, FTX's new CEO called the mess "[unprecedented](https://www.wsj.com/articles/ceo-overseeing-ftx-restructuring-calls-it-an-unprecedented-mess-11668707836)" (and he oversaw the Enron bankruptcy). 
- __🌶️ Spicy…__ An FTX investor is [suing](https://variety.com/2022/digital/news/ftx-lawsuit-larry-david-tom-brady-stephen-curry-crypto-1235434627/) Larry David, Tom Brady, and Steph Curry, among others, alleging their paid promotions for the now bankrupt crypto exchange lured "unsophisticated investors" into a "Ponzi scheme." 
- __🤖 Techy…__ Crypto hardware wallet makers __Ledger__ and __Trezor__ saw booming sales last week after FTX froze customer withdrawals. Hardware wallets let crypto “hodlers” self-custody their coins (no exchange required).

SBF'D

The Crypto Catch-Up…

Average 401(k) balances fell for the third straight quarter, down 23% from last year

🛍️ Marshalls’ treasure-hunt win

__Alexa, play “Bad Blood”…__ Taylor Swift fans have major beef with Ticketmaster. On Tuesday, the __[Live Nation](https://robinhood.com/stocks/LYV/)__-owned ticket platform suffered outages after *millions* of Swifties tried buying tickets to Taylor’s 2023 “Eras” tour, her first in five years. Presale tix were going for $49 to $500 on Ticketmaster, but resellers quickly began listing seats for as much as $21K+ on third-party sites like __StubHub__. Some police stations warned fans about a surge in ticket scammers.

- __Fans said__ they were forced to wait hours for site access — and many still couldn't complete their transactions, despite having a presale code.
- __Ticketmaster said__ the problems were a result of “historically unprecedented demand,” and it extended the presale event for an extra day.
- __FYI:__ Swift’s “Midnights” became __[Spotify’s](https://robinhood.com/stocks/SPOT/)__ most-streamed album in a single-day when it dropped last month.

__Pop-star performances…__ at Super Bowl prices. The live-music industry has had a show-stopping comeback since the pandemic hit. Last quarter, Live Nation’s revenue climbed 63% from 2019, and it’s on pace to notch record ticket sales this year. But as more Americans splurge on experiences over objects, concert prices have surged nearly 15% from prepandemic. It's good news for Ticketmaster, which is said to make up 70%+ of ticketing services for major venues like __[Madison Square Garden](https://robinhood.com/stocks/MSGS/)__.

It’s hard to shake it off (John Leyba/Getty Images)

Swifties

__It's hard to be a hater of the top player…__ Music fans may be mad at Live Nation, but its live-music dominance makes it hard to escape. In January, Live Nation was accused of snubbing venues that didn’t use Ticketmaster. Meanwhile, Alexandria Ocasio-Cortez [tweeted](https://twitter.com/AOC/status/1592587226801934336) that Ticketmaster was a "monopoly" after the Swift drama. But the backlash hasn’t curbed demand: Ticketmaster sales for 2023 shows are already on track to surpass this year’s.

T-Swift’s world-tour rush crashed Ticketmaster, highlighting the reach of Live Nation's concert empire

__Place your right hand…__ on the crypto white paper? Sam Bankman-Fried has been called to testify. The House Financial Services Committee said the __FTX__ founder is expected to [speak](https://decrypt.co/114816/house-committee-sbf-binance-testify-ftx-collapse) to lawmakers next month about his now bankrupt exchange's spectacular collapse. SBF was a regular on Capitol Hill, lobbying for centralized-exchange-friendly regulation. He spent $40M in the last election cycle, mostly on Democratic candidates and causes. Now the so-called wunderkind could be forced to explain how customer funds disappeared (reportedly up to $2B):

- __FTXtradition:__ American and Bahamian law enforcement (FTX is Bahamas-based) are said to be in talks to bring SBF to the US for questioning — separate from the House hearing. 

__Mr. SBF goes to Washington…__ but this time he’s in the hot seat. Before FTX imploded, lawmakers had been working on the SBF-favored Digital Commodities Consumer Protection Act (DCCPA). The bipartisan bill would give commodities regulators (aka: the CFTC) additional crypto oversight. But critics said it would prop up centralized exchanges like FTX while hurting decentralized ones like __Uniswap__. Now the bill's future is in doubt:

- __SB-effed:__ The Blockchain Association, a crypto trade group, said the DCCPA has SBF's stink on it, and predicts elected officials will want to distance themselves. And yet…
- __Better than nothing:__ Sens. Debbie Stabenow and John Boozman, the bill's backers, are doubling down, saying FTX's fall hastens the need for regulation.

SBFED

__The sunk-cost fallacy is a powerful motivator…__ and so is embarrassment. FTX's bankruptcy left elected officials in an awkward position: do they push forward regulation once championed by crypto's now “[villain](https://www.nytimes.com/2022/11/14/technology/ftx-sam-bankman-fried-crypto-bankruptcy.html)” du jour, or walk away from months of efforts only to start anew? Stabenow and Boozman have chosen the latter. Meanwhile, __Binance’s__ CEO is also calling for regulation — just not through the DCCPA.

Lawmakers want SBF to testify as FTX's collapse puts crypto regulation in the spotlight

T-Swift’s world-tour rush crashed Ticketmaster, highlighting Live Nation's concert empire

NASA’s Artemis I rocket successfully launched yesterday, becoming the most powerful launch vehicle to ever lift off from Earth

🎤 T-Swift’s Ticketmaster drama

__Clear aisles, full carts, can’t lose…__ America’s largest retailer is seeing the bright side of dark times. __[Walmart](https://robinhood.com/stocks/WMT/)__ shares spiked 7% yesterday to a six-month high after it delivered surprisingly strong quarterly sales (up 8%) and boosted its forecast. The MVP of earnings: groceries. Kitchen staples like canned beans and hot dogs carried the quarter. 

- __In the cart:__ Food was the fastest-growing category with double-digit sales growth as more shoppers turned to Walmart for its “everyday low prices.” 
- __In the storeroom:__ Discretionary items like TVs, air fryers, and clothing were weak. On the plus side, Walmart unloaded some of its excess inventory piles. 
- __[Target](https://robinhood.com/stocks/TGT/),__ which reports today and is also a grocery go-to, could echo these trends. 

__$6 Hu chocolate to $1 [Hershey’s](https://robinhood.com/stocks/HSY/)…__ Americans are trading down. Walmart’s CFO said customers have been turning to less pricey protein sources like hot dogs, beans, and store-brand peanut butter. __[Tyson’s](https://robinhood.com/stocks/TSN/)__ lackluster report this week confirmed that demand for premium beef and pork is dropping. But it’s not just lower-income customers trading down: 

- __More high-income customers__ turned to Walmart last quarter for cheaper groceries. 75% of its market-share gains in food came from households making $100K+. 
- __With grocery prices up 12%__ from a year ago, discount retailers like __[Dollar General](https://robinhood.com/stocks/DG/)__ and __[Grocery Outlet](https://robinhood.com/stocks/GO/)__ have also [gained](https://www.forbes.com/sites/laurendebter/2022/11/15/walmart-attracting-wealthier-customers-looking-for-cheaper-groceries-as-inflation-rages/?sh=447b83843e8d) wealthier customers. 
- __It’s a theme:__ In its latest earnings, __[McDonald’s](https://robinhood.com/stocks/MCD/)__ said it attracted more higher-income customers who opted for fast-food over pricier sit-down restaurants.

Seeing the cart as half full (Gilles Mingasson/Getty Images)

PB&J

__Tough times can be growth times…__ or an opportunity for big companies to grab a larger slice of the pie. Walmart gained US grocery market share as inflation spurred higher-income shoppers to browse its aisles. Corporate titans like Walmart, __[Amazon](https://robinhood.com/stocks/AMZN/)__, and McDonald’s can afford to keep prices relatively low during downturns to grow their market share (McD’s did [just that](https://slate.com/business/2009/08/how-mcdonald-s-won-the-recession.html) in ’08) while smaller or pricier players could suffer.

Walmart stock spikes as higher-income shoppers boost its grocery market share

__Prefab(ulous) homes…__ coming to a lawn near you. This week __[Airbnb](https://robinhood.com/stocks/ABNB/)__ cofounder Joe Gebbia [unveiled](https://www.wsj.com/articles/airbnb-co-founders-new-business-is-building-small-homes-in-backyards-11668414543) his newest venture, __Samara__, which plans to sell small homes for backyards. Samara’s accessory dwelling units (aka: ADUs) start at $289K for studios and $329K for one-bedrooms. Samara hopes homeowners will use its little abodes not just as rental properties but as extra space for themselves. 

- __Guest-house vibes:__ Each ADU has a spacious bathroom, kitchen, and washer/dryer. You can even splurge $10K for solar panels.
- __FYI:__ The mini homes will first be available in California, where new laws have made it easier for residents to build on their lots. But Samara has plans to expand.

__Back to WFMH…__ work from mom’s home. More Americans might start turning garages into guest houses as sky-high prices box out would-be buyers (average home sale price = $542K). As of July, more than half of young adults (age 18 to 24) were living with their parents. And last year nearly a fifth of Americans were living in multigenerational homes. As US housing affordability hits its lowest level since 2012, mini homes are gaining popularity: 

- __CA issued nearly 20K ADU__ building permits last year, up 58% from 2019. The US tiny-home market is expected to grow at a [record](https://www.prnewswire.com/news-releases/tiny-homes-platform-market-to-record-a-yoy-growth-rate-of-3-88---technavio-identifies-north-america-as-key-market-301614953.html) pace this year.
- __Mobile homes are hot too:__ From 2016 to 2021, the median price of trailers surged 34%.

Cozy

__If you build it, they could come…__ Experts say there’s a nationwide housing shortage of up to 6M new homes. By one estimate, there’s room for 1.5M backyard homes in CA, which could help ease some of the state’s crunch. But with rising interest rates and inflation cutting into homeowner budgets, it could be a while before they become mainstream.

Airbnb cofounder launches a tiny-home biz to tackle California’s housing shortage as Americans are crunched for living space

Household debt grew at its fastest pace in 15 years last quarter as credit-card balances ballooned

🌭 Walmart’s hot-dog quarter

__Chilling in Miami with the heat…__ Not enjoying the Florida sunshine: FTX. The bankrupt crypto exchange had signed a 19-year, $135M deal for naming rights to the Miami Heat’s home arena last year. Now Miami-Dade County and its NBA team say they’re “immediately taking action” to [end](https://www.espn.com/nba/story/_/id/35004915/miami-heat-cut-ties-bankrupt-ftx-rename-home-arena) their relationship with FTX. The exchange had paid $14M up front and was scheduled to make a $5.5M payment in January.

- __Bye, FTX Arena:__ It’ll still be referred to as FTX Arena for Saturday’s Heat game, but social-media [pics](https://twitter.com/shiv2268/status/1591195099199049729) suggest the FTX logo is already being dismantled. 
- __Hi, [insert name here] Arena:__ Miami said it would work with the Heat to find a new naming-rights partner for the arena. 

__From the NBA to the MLB…__ FTX has a stacked portfolio of sports sponsorships. Last year, Major League Baseball signed a five-year deal to name FTX its official crypto-exchange partner (think: FTX.us patches on umpire uniforms).

- __Racing:__ FTX also had a long-term sponsorship deal with __[Mercedes’](https://robinhood.com/stocks/MBGYY/)__ Formula One team — that’s now been scrapped (no more FTX logos on F1 cars). 
- __Esports:__ FTX had struck a naming-rights deal with US esports giant __TSM__, among other esports players. Brazilian org Furia tweeted that it’s ending its deal with FTX. 
- __Football:__ Last year UC Berkeley struck a $17.5M, 10-year naming-rights deal with FTX for its football stadium. TBD if it’s getting a new name.

New name coming in hot (Andy Lyons/Getty Images)

Defense

__Crypto has covered its bases…__ in sports. Crypto brands spent $130M+ on NBA sponsorships alone last season, up from ~$2M in the previous season. Five crypto companies — including FTX, __Crypto.com__, and __[Coinbase](https://robinhood.com/stocks/COIN/)__ — were responsible for 92% of NBA sponsorship spending in the crypto category. Crypto.com’s Lakers’ stadium-naming deal alone is reportedly worth $700M. But now that the Enron-style “[naming-rights curse](https://protos.com/has-the-naming-rights-curse-finally-hit-crypto/)” has hit FTX, sports orgs might need to cover their bases too.

Miami ditches “FTX Arena” as sponsorships with the bankrupt exchange haunt sports orgs

__Big opening weekend for Wakanda…__ __[Disney’s](https://robinhood.com/stocks/DIS/)__ “Black Panther: Wakanda Forever” just [raked](https://www.axios.com/2022/11/14/black-panther-sequel-box-office-momentum) in $180M in North America, the second-biggest box-office haul of the year and the highest-grossing November debut ever. 

- __It’s a much-needed win__ for Disney, whose sales and earnings fell short of expectations last quarter despite rebounding attendance at its parks.
- __Big shoes to fill:__ “Wakanda Forever” was the first flick to crack $100M since July. But the super sequel fell short of the original “Black Panther,” which featured the late Chadwick Boseman ($202M on opening weekend). 

__It’s Marvel’s universe…__ we’re just living in it. The only movie that’s outperformed “Wakanda Forever” this year was another Marvel flick, the latest “Doctor Strange.” In fact, 9 of the top 15 domestic debuts in history are now Marvel films (not adjusted for inflation). 

- __Marvel mania:__ The seven Marvel movies that Disney’s released in the past two years have grossed $2.3B, more than a fifth of total box-office sales in that period. 
- __Well-versed:__ Disney uses its Marvel-verse to cross-promote shows, parks, and merch. It plans to build an Avatar-verse around its new “Avatar” film, which opens next month.

Versed

__It’s the “-verses” versus everyone…__ Disney has invested heavily in “theatrical universes” like the Marvel-verse and the “Star Wars”-verse, whose recognizable characters still attract large audiences even as theater attendance slumps. Last month, rival Hollywood heavyweight __[Warner Bros. Discovery](https://robinhood.com/stocks/WBD/)__ released “Black Adam” to bolster its growing DC-verse. But as studios focus on a few mega-blockbusters, theater chains like __[AMC](https://robinhood.com/stocks/AMC/)__ are suffering: US box-office sales this year are still a *third* below prepandemic levels.

Disney’s “Black Panther” sequel broke a November box-office record — another win for the Marvel-verse

*📊 Like if your banker did a show-and-tell, but left half the presentation at home…*

Crypto exchanges are in the spotlight after FTX’s bankruptcy. Now nine exchanges are rushing to reassure everyone that they've actually got customers' assets. __Binance__ said it would issue "[proof of reserves](https://fortune.com/crypto/2022/11/14/binance-promised-transparency-proof-of-reserves-crypto-ftx/)": cryptographic proof it holds the coins it claims. But proof of reserves has been criticized because it's only one part of an exchange's financial health. Another part: proof of *liabilities* (how much the exchange *owes*).

DEFI(NE)

Heard on the Block: “proof of reserves”

The human population has doubled in just 48 years, hitting 8B this week

🏀 FTX Arena bounces

__The midterm hangover…__ isn’t over. It’s still too close to call, but the US might get a split government, with one GOP-controlled chamber of Congress. Stocks plunged Wednesday after midterm results didn’t show clear gridlock. Investors generally prefer when power’s shared, because historically that’s meant less legislation (it’s harder to agree on things). That can mean fewer potential blockers for business, regardless of which party’s in power. 

- __Democrats maintained__ their slim majority in the Senate after key victories in Nevada and Arizona over the weekend. Georgia’s runoff election is slated for December 6. 
- __If Republicans take the House__ (which they’re favored to) that’s enough to unlock gridlock. Either way, majorities will likely be slim within both chambers.  

__Ballot bubbles giving SAT flashbacks…__ From choosing lawmakers to voting on propositions, Americans’ ballot decisions could have big implications. A few sectors that could be affected:

- __Energy:__ Republican lawmakers have supported US energy independence, and that could lead to easier access to drilling permits if the GOP takes the House. 
- __Cannabis:__ Voters in Maryland and Missouri legalized recreational marijuana, joining 19 other states and DC. Meanwhile, Colorado voted to decriminalize and regulate some psychedelic substances (think: magic mushrooms). 
- __EVs:__ California voted down an extra tax to build EV infrastructure. __[Lyft](https://robinhood.com/stocks/LYFT/)__ was the biggest backer of the prop, since the funds would’ve helped it meet the state’s requirements. 
- __Gambling:__ CA voters also struck down a prop that would’ve allowed gambling companies like __FanDuel__ and __[DraftKings](https://robinhood.com/stocks/DKNG/)__ to offer online sports betting.
- __Tobacco:__ And CA became the largest state to ban flavored-tobacco products after voters upheld the state’s ban. Tobacco titans like __[Philip Morris](https://robinhood.com/stocks/PM/)__ and __[RJ Reynolds](https://robinhood.com/stocks/RAI/)__ had spent big in hopes of overturning it.

Wall Street’s waiting (Kena Betancur/Getty Images)

Voted

__Investors care more about the Fed right now…__ Because the central bank has the levers to influence rates and inflation. Inflation was voters’ [most pressing](https://www.npr.org/2022/11/07/1134832876/inflation-is-top-issue-in-this-weeks-midterms) issue in these elections (two years ago it wasn’t on the radar). Markets rallied hard Thursday after news that inflation cooled more than expected last month, which suggests the Fed might slow its rate hikes (top of mind for investors).

How midterms could affect the markets, from inflation to energy to cannabis

__Major whiplash…__ Crypto exchange __FTX__ (including FTX US and 130 affiliated companies) filed for bankruptcy Friday after a whirlwind week revealed an $8B balance-sheet hole — and rival __Binance__ bailed on its takeover plan. Oh, *and* FTX halted customer withdrawals — but that didn’t stop $515M from being moved out of the exchange Friday night in a possible hack. Sam Bankman-Fried, the exchange's now former CEO, had been a Capitol Hill regular lobbying for industry-friendly regs. Now, that regulation's in doubt. Meanwhile, investors fear FTX's "contagion" could spread. One sign that it may have already: __BlockFi__ (which got bailed out by FTX in June) suspended withdrawals, citing FTX's downfall. 

__Googling “packing hacks”...__ to avoid the $50 luggage fee. Budget airlines are booming as more travelers turn to no-frill flights to hit the inflated skies. Last week, Irish airline __Ryanair__ reported record passengers and profits for its summer quarter. Meanwhile, US-based __Frontier__ saw sales jump 35% as passengers paid extra for perks (think: bearable legroom). Travel is still hot: even with airfare forecast to be the priciest in five years, half of Americans plan to travel this holiday season.

__Xi Jinping saw his shadow…__ and Chinese stocks may have six more weeks of winter. China’s tech giants posted their slowest growth *ever* in August as Beijing’s zero-Covid policy raised costs and hurt demand (because: more lockdowns). Chinese stocks popped this month on reopening rumors. But as Covid cases surged last week hawkish President Xi said he planned to “hold fast” to the strict policy (though he relaxed *some* rules on Friday). We’ll see how wounded giants __Alibaba__, __JD.com__, and __Tencent Music__ are faring when they report this week.

__Jingle bells in November…__ Retailers are getting into the holiday spirit early. __Walmart’s__ sales jumped 8% last quarter, but profits were squeezed as inflation-fatigued shoppers avoided big-ticket items like TVs. __Target’s__ profits fell 90% as it offered steeper discounts on overstocked goods. Still, holiday sales are expected to rise from last year, and retailers are already setting up festive displays to hype demand. But an unmerry combo of discounts and high costs could keep Walmart and Target from wowing investors when they report this week.

Events

Coming up this week...

- __[HitTok](https://snacks.robinhood.com/newsletters/4gOzlWfuufbhkgNYnGBQA1/articles/6WbU0NDw8OQzavUs2zgGWp/):__ From __Sony__ to __Universal Music__, the largest record labels want a bigger cut from __TikTok__ as the app becomes a hit-maker. While TikTok needs the music industry, the industry increasingly needs the Tok.
- __[iSag](https://snacks.robinhood.com/newsletters/1rIPKyj7VdAtV8FpwShSUE/articles/gRGR2FVnkico17JfZqUlQ/):__ __Apple's__ expecting a drop in iPhone shipments this holiday season (picture: 3M fewer iPhone 14s than anticipated). Last week, China’s Covid policy triggered a weeklong shutdown at the main iPhone assembly site. 
- __[Alexa](https://snacks.robinhood.com/newsletters/4sSb6rTTRHcOl77ZhrZz2R/articles/4s4UBkKJDUcEfl5DFMLZsx/):__ __Amazon's__ reportedly looking to cut costs, and Alexa could get downsized. But instead of __Meta__-sized layoffs, Amazon is said to be pushing workers to find roles in more lucrative divisions of the company.

China is nearly as wide as the US, but the entire country officially has just one time zone

🇺🇸 Midterms and markets

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

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

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

Bad robot (Joby Sessions/Getty Images)

Alexcut

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

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

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

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

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

Infla-date

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

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

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

REKTX

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

👄 Amazon’s Alexa ache

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

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

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

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

Whiplash

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

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

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

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

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

Peachy

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

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

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

👋 Binance walks away from FTX

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

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

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

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

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

Looped

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

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

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

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

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

Duopoly

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

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

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

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

🎶 Labels come for TikTok

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

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

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

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

Unboxed

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

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

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

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

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

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

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

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

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

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

Heard on the Block: “alt season”

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

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