__See ya later, regulator…__ The US Supreme Court just dealt environmental regulators a hefty blow. Yesterday, SCOTUS [struck down](https://www.wsj.com/articles/supreme-court-limits-environmental-protection-agencys-authority-11656598034?mod=hp_lead_pos1&mod=business_lead_pos1) an EPA plan to require power plants to cut emissions. (FYI: the plan didn’t have traction anyway.) The court said that regulations with sweeping economic consequences were invalid unless OK’d by Congress. That sets a precedent that could reshape relations between companies and regulators.

- __Bad news for Biden,__ whose climate agenda relies on the EPA. With Congress split, the president relies heavily on federal agencies for enforcement. 
- __Good news for coal companies__ like __[Peabody Energy](https://robinhood.com/stocks/BTU)__, __[Glencore](https://robinhood.com/stocks/GLNCY)__, and __[Arch Resources](https://robinhood.com/stocks/ARCH)__, who now get an emissions hall pass. Many coal stocks have soared this year on high energy prices. 

__Light(er) green…__ The ruling comes as green investment has been losing steam. After outperforming the S&P 500 in last year’s bull market, ESG (aka: environmental, social, and governance) funds have [underperformed](https://snacks.robinhood.com/newsletters/34FDmnLHYiY52nfOf5RPi2/articles/1xeNLcA6O6rx5dxUJRCDcL/) in this year’s downturn. Meanwhile, climate-ambitious companies like __[BlackRock](https://robinhood.com/stocks/BLK)__ and __[Volkswagen](https://robinhood.com/stocks/VWAGY)__ have scaled back their sustainability goals in response to the energy crisis.

- __Green pause:__ Experts expect the ruling to further delay the renewable transition, which could cut into sales for companies like __[Tesla](https://robinhood.com/stocks/TSLA)__, __[JinkoSolar](https://robinhood.com/stocks/JKS)__, and __[ChargePoint](https://robinhood.com/stocks/CHPT)__. 
- __Pump pass:__ Fossil-fuel big shots like __[Shell](https://robinhood.com/stocks/SHEL)__, __[Chevron](https://robinhood.com/stocks/CVX)__, and __[Exxon](https://robinhood.com/stocks/XOM)__ could benefit from growing demand and shrinking regulation.

A coal-fired power plant in West Virginia (Spencer Platt/Getty Images)

Coaled

__An era of deregulation may be dawning…__ and it goes beyond power plants. The EPA likely won’t be the last federal authority targeted by this emboldened court. Last year, SCOTUS stopped the CDC from halting pandemic evictions and prevented OSHA from mandating corporate vaxxes. With regulators hobbled and Congress stuck, corporations could push for a rollback of other profit-curbing rules.

The Supreme Court limited the EPA’s emissions enforcement power — and other agencies could be next

__When DAOs become CAOs...__ Imagine if a bunch of ants got together to form a colony without a queen — *and ended up managing billions in assets*. That’s kind of like DAOs (aka: decentralized autonomous organizations), crypto communities where token holders have decision-making power. But a new [report](https://blog.chainalysis.com/reports/web3-daos-2022/) has found that 10 major DAOs sort of have a queen after all: fewer than 1% of token holders control 90% of voting power. This centralization has consequences:

- __So long, Solend:__ The DAO behind a __[Solana](https://robinhood.com/crypto/SOL/)__-based lending protocol voted to take over Solend’s largest user’s wallet in mid-June — but 88% of the vote came from a single crypto address. 
- __Second try:__ The Solend DAO appeared to realize centralization wasn’t a good look and reversed itself with a second vote. Still, the reputational damage to DAOs was done.

__Don’t let me DAO...__ As crypto winter hits, centralized points of failure are rearing their heads. And it’s not just DAOs. Crypto lender __Celsius’__ DeFi play imploded, and then it unilaterally [froze](https://snacks.robinhood.com/newsletters/74Rmw5VlxBTIazWlkKzrHf/articles/3f7BisGSpk0jgZKhOePwTn/) customer withdrawals (a rather centralized move for the “innovators of decentralized finance”). Meanwhile, some of crypto's main players see consolidation as key to success:

- __Fire sale:__ [CNBC](https://www.cnbc.com/2022/06/30/ftx-closes-in-on-a-deal-to-buy-embattled-crypto-lender-blockfi-for-25-million-in-a-fire-sale.html) reported that Crypto exchange __[FTX](https://robinhood.com/crypto/FTT/)__ was in talks to buy crypto lender __BlockFi__ at bargain-basement prices. Last valued at $4.8B, BlockFi could go for $25M (womp). 
- __Bi-now:__ The world’s largest crypto exchange, __[Binance](https://robinhood.com/crypto/BUSD/)__, is ready to gobble up struggling competitors, [eying](https://ca.finance.yahoo.com/news/binance-ceo-says-company-eyes-50-to-100-deals-130807491.html) “50 to 100 deals.”

__Crypto has a centralization problem...__ Crypto promoters have long rallied behind the value of decentralization — it's the “D” in “DAO” and “DeFi,” after all. But investigation, combined with a market downturn, reveals increasing centralization. Read: crypto nest eggs are ending up in fewer and fewer baskets. That may need to change for crypto winter to bloom into a decentralized spring.

Crypto's hyped decentralized decision-making orgs may not be so decentralized after all, calling their purpose into question

SCOTUS curbed the EPA’s emissions enforcement power — and other agencies could be next

Dow Jones

S&P 500

Nasdaq

Bitcoin

Ketanji Brown Jackson just became the first Black woman to serve on the US Supreme Court 

💨 SCOTUS vs. the EPA

__“What can I do to get you in this F-150?”…__ Ship it to me. Car dealers fear their biz model may disappear as auto giants like __[Ford](https://robinhood.com/stocks/F)__ sell more cars directly to buyers — and cut out the dealerships who make money as go-betweens. This week Ford CEO Jim Farley [met](https://www.wsj.com/articles/fords-talk-of-new-ev-selling-rules-rattles-some-dealers-11656504003?mod=business_lead_pos6) with 300 dealers to cool their concerns. 

- __Ford wants to sell 100% online:__ what Farley told investors this month. The goal: save $$. Farley said __[Tesla’s](https://robinhood.com/stocks/TSLA)__ direct sales model (think: Tesla stores) saves corporate $2K/car.
- __Bye, “sell, sell, sell”...__ hi, “service, service, service.” Farley says dealers will still play an important role in the car game — but more as service providers, less as salespeople. 

__Separation of car and dealer…__ the auto industry’s equivalent of separation of church and state. For decades, “franchise laws” have forced automakers to sell cars through third-party dealers for antitrust reasons. But since 2013, Tesla has gotten several states to pass special laws that allow direct EV sales, sidestepping intermediaries. 

- __Mimicking Tesla’s model:__ EV startups __[Rivian](https://robinhood.com/stocks/RIVN)__, __[Lucid](https://robinhood.com/stocks/LCID)__, and __[Polestar](https://robinhood.com/stocks/PSNY)__ also sell cars directly online and in company showrooms, ditching the dealerships.
- __Joining the EV-olution:__ Ford, __[GM](https://robinhood.com/stocks/GM)__, __[VW](https://robinhood.com/stocks/VWAGY)__, and Jeep parent __[Stellantis](https://robinhood.com/stocks/STLA)__ have all started selling EVs directly to consumers online.

“This truck was made for you” (Brandon Bell/Getty Images)

__It takes time to ditch old models…__ and dealers may not go down quietly. By 2030, auto execs expect that half of cars sold in the US will be EVs — and they’re betting *direct* sales will be an important channel. But unlike Tesla, legacy automakers like Ford and GM have to manage disgruntled dealers as they transition to direct sales. Pricey lawsuits could pile up, especially if big retailers like __[AutoNation](https://robinhood.com/stocks/AN)__ and __[Penske](https://robinhood.com/stocks/PAG)__, which own thousands of dealerships, get involved.

As carmakers like Ford shift to selling directly to drivers, dealerships may lose the steering wheel

__Ketchup in aisle three…__ or not. Yesterday, __[Kraft Heinz](https://robinhood.com/stocks/KHC)__ said it would temporarily [stop](https://www.bbc.com/news/business-61978595) supplying __[Tesco](https://robinhood.com/stocks/TSCDY)__ — the UK’s largest grocery chain — with its signature Heinz pantry products (think: ketchup, baked beans). There’s beef: Heinz wants to hike its prices to cover rising costs, but Tesco wants to keep prices attractive for its customers. Long story short: they couldn’t agree.

- __Price-sensitive:__ In 2016, Tesco briefly [removed](https://robinhood.com/stocks/TSCDY) some __[Unilever](https://robinhood.com/stocks/UL)__ products from its website after the Dove parent tried to hike some of its prices by 10%.
- __Tooth-sensitive:__ In February, Tesco [blamed](https://www.bbc.com/news/business-60316980) “short supply” for why __[Colgate’s](https://robinhood.com/stocks/CL)__ toothpaste products weren’t in stock. But analysts say it was [over](https://www.bbc.com/news/business-60316980) pricing disagreements. 

__Don’t spill the tea…__ It costs a small fortune. Across Europe, consumer prices are hitting records as households struggle to afford everything from energy bills to cereal. Last month, nearly [half](https://www.bbc.com/news/business-61920559) of adults in the UK cut back on supermarket shopping, and it’s [starting](https://www.wcvb.com/article/largest-grocery-chain-says-shoppers-buying-less-switching-to-store-brands/40312059) to happen in the US too. But grocery chains across the pond are taking different approaches:

- __In the US,__ where food spending has remained relatively stable, grocery chains aren’t doing much to keep prices in check. Instead, we’re seeing smaller Doritos and Fruity Pebbles packages as food giants #shrinkflate to avoid higher price tags — or use [creative](https://snacks.robinhood.com/newsletters/jtHnqwq8xydDjbgiulBNB/articles/6u4NsfgUX9a28K4g5NZ4JS/) ways to sell the same products at a premium. 
- __In Europe:__ Grocery chains like France’s __Leclerc__ are taking on extra [costs](https://snacks.robinhood.com/newsletters/PbfDGtpHVvDV3e1fKrQWi/articles/6OnamPp5yxj6ClnNZTUevH/) to “price shield” hundreds of popular products (think: pizza, pasta) so that customers keep spending.

Catsup

__Inflation has “checks and balances”…__ Price hikes allow food companies like Heinz to offset rising costs while keeping staples on the shelves. But by *not accepting* higher prices, grocery stores can keep shoppers spending and prevent them from turning to rivals. These checks and balances could help lower inflation — but a lot more checking will be required.

Heinz is pulling its famous condiments from the UK's largest grocery chain as price wars escalate overseas

As Ford and others shift to selling directly to drivers, dealers may lose the steering wheel

“Top Gun: Maverick” is the first Tom Cruise flick to rake in $1B at the box office

🚗 Ford follows Tesla

__Ditched the app...__ But probably not the data. People are deleting their period-tracking apps in response to the decision to overturn Roe v. Wade. Social media posts have [sparked](https://www.newsweek.com/why-delete-period-tracking-app-roe-v-wade-ruling-sparks-panic-data-1719167) fears that menstruation data could be subpoenaed by authorities in states where abortion is outlawed and used as evidence in potential criminal cases. Now, fertility apps are [taking steps](https://www.wsj.com/articles/period-tracker-apps-aim-for-anonymity-following-roe-v-wade-decision-11656202089) to anonymize user data.

- __Flo,__ the #1 period-tracker, said it’ll launch a feature called “Anonymous Mode” to give users the option of removing their personal info.
- __Clue,__ another popular period and fertility app, saw a [2,200%](https://techcrunch.com/2022/06/27/consumers-swap-period-tracking-apps-in-search-of-increased-privacy-following-roe-v-wade-ruling/) boost in downloads over the weekend after saying that it won't share sensitive data with states.
- __Natural Cycles,__ the first FDA-approved birth-control app, is trying to build a “completely anonymous experience for users.”
- __[Apple](https://robinhood.com/stocks/AAPL)__ says data from its popular health app already can't be shared or sold since it's end-to-end encrypted.

__Sensitive info…__ Millions of women, transgender, and nonbinary people rely on these apps to help them track their periods, avoid pregnancy, or become pregnant. But unlike data shared with healthcare providers, data from health apps isn’t typically HIPAA protected. Now, app developers are scrambling to ensure that they don’t have user-specific info to share in the first place.

Tracking raises new concerns(Toronto Star / Getty Images)

Tracked

__Fertility could be the next frontier…__ in the privacy wars. Sharing and selling app data is a long-standing (and long-criticized) practice, usually done for ad purposes. Now, it’s not just period apps that could be caught in the privacy thorns: there’s a possibility that prosecutors [could](https://www.axios.com/2022/06/27/tech-companies-roe-v-wade-data-privacy) seek data on everything from pregnancy test purchases at pharmacies to ovulation kits on __[Amazon](https://robinhood.com/stocks/AMZN)__ — and potentially even messaging and location data from social apps like __[Facebook](https://robinhood.com/stocks/META)__.

Period-tracking apps scramble to anonymize user data over concerns that states could use it in potential abortion cases

__Duty-free essentials…__ Perfume and hundred-year old bourbon. Global duty-free sales are up 34% from peak pandemic as returning travelers make pre-flight purchases — *tax free.* But one product is winning in terminals: whiskey accounts for the largest share of the duty-free liquor market, with shoppers even flying to specific airports [for](https://www.forbes.com/sites/kevinrozario/2022/06/27/duty-free-retail-continues-to-attract-highly-coveted-scotch-whiskies-and-set-records/?sh=345655731256) coveted collections.  

- __$817K:__ How much one collector paid for a set of the high-end __Macallan__ Six Pillars Scotch whiskey at Dubai’s International Airport
- __$500K:__ What one traveler paid at Istanbul's airport for an ultra-rare Japanese whiskey in January..

__Birkin-vested...__ High-end malts aren’t the only luxury products prospering at duty-free and other stores. Demand for luxe goods in general has been soaring. 

- __Designer bags:__ Chanel’s classic Medium Flap bag is $2K pricier now than it was in January 2021. Hermes’ Birkin bag prices rose 38% in 2020. 
- __Luxury watches:__ Are a hot commodity as [demand](https://www.bloomberg.com/news/newsletters/2022-05-25/supply-chain-latest-rolex-shortage-sees-demand-for-other-luxury-watches-jump) outpaces supply. A Rolex could [cost](https://www.gearpatrol.com/watches/a675756/rolex-prices/) 10% more than last year, and annual returns for Rolly collectors popped 33% last year. 
- __Vintage cars:__ A used 1986 __[Ford](https://robinhood.com/stocks/F)__ Bronco will [run](https://www.hotcars.com/these-classic-cars-prices-have-skyrocketed-in-2022/) you 48% more than last year — and nearly 3X more if it’s in excellent condition.

Whi-sky

__When stocks go south, alt-investments can rise…__ The ultra-rich have the luxury of turning to non-traditional assets (think: fine art, collectibles) to store cash during econ downturns. But over [half](https://www.nerdwallet.com/article/investing/many-drawn-to-alt-investing-survey-finds-but-risks-await) of all Americans are interested in alt-investments. Now, startups like __Vinovest__ and __Masterworks__ are giving more people a chance to invest in a high-end wine or a Bansky painting — without spending six figures. But like traditional investments, alt-investments carry risk. Prime example: alt-investment crypto has tanked along with the stock market.

"Whiskey-vesting" is driving record sales for duty-free liquor brands as demand for alt-assets gains steam

Period-tracking apps scramble to anonymize user data over concerns it could be used to prosecute abortion cases

Tampax raised pay at its only US factory to $25/hour, but still can’t hire enough workers as the tampon shortage continues

📱 Period data privacy

__The headline that no one missed…__ On Friday, the Supreme Court ruled to overturn Roe v. Wade, the 1973 landmark [ruling](https://www.britannica.com/event/Roe-v-Wade) that protected abortion as a federal right covered by the Constitution. Nearly half of US states have plans to quickly ban or limit abortion — and several [already have](https://www.cnbc.com/2022/06/24/roe-vs-wade-supreme-court-abortion-ruling-divides-america.html). In order to legally terminate a pregnancy, women in those states will have to travel to states where abortion isn't criminalized. For many, this travel may not be an option.

__Now corporate's stepping in...__ After the ruling, several large companies pledged to provide financial support for employees — and in some cases, even their dependents — who live in states where abortion's outlawed. The response has been swift:

- __[Disney](https://robinhood.com/stocks/DIS), [Microsoft](https://robinhood.com/stocks/MSFT), [Chase](https://robinhood.com/stocks/JPM),__ and __[Levi](https://robinhood.com/stocks/LEVI)__ were among those that said they'd cover employee travel expenses for abortions.
- __[Citi](https://robinhood.com/stocks/C), [Salesforce](https://robinhood.com/stocks/CRM), and Tinder-owner [Match](https://robinhood.com/stocks/MTCH)__ vowed to provide financial support for affected employees back in May, when the draft opinion was leaked.
- __Others like [Apple](https://robinhood.com/stocks/AAPL), [Netflix](https://robinhood.com/stocks/NFLX), and [Uber](https://robinhood.com/stocks/UBER)__ say they already cover travel expenses for healthcare treatments, including abortion and gender-affirming care.
- __Some GOP lawmakers__ are considering ways to [retaliate](https://www.theguardian.com/us-news/2022/may/08/us-companies-abortion-travel-assistance-roe-v-wade) against companies which help cover medical and travel costs. Think: asking Congress to cancel its contract with Citi.

Corporate holds court (Anadolu Agency via Getty Images)

Ruled

__Corporations can try to be the 4th branch...__ of government. Companies are becoming increasingly active on social and political issues. That’s largely because many customers, employees, and investors no longer accept inaction. While companies don't have executive, legislative, or judicial power, they have financial influence — from where they choose to open offices, to where they put their $$. __[Duolingo](https://robinhood.com/stocks/DUOL)__ already warned that it would limit expansion in places that outlaw abortion.

As nearly half of US states move to restrict or ban abortion, corporate behemoths are stepping in to offer employees support

__Loose collars…__ Still plenty of pressure. This year’s Group of 7 meeting, which wraps today in Germany, had a surprisingly [casual dress code](https://www.gq.com/story/g7-summit-no-ties). The agenda: not-so-casual. President Biden and other leaders of the world’s wealthiest democracies spent three days debating how to punish Russian President Putin for his continued war in Ukraine — *without* punishing consumers. The details: 

- __Oil be darned:__ The US already banned Russian oil imports, and the EU is phasing them out. But thanks to wild prices, Russia’s making even more $$ from oil than it did pre-Ukraine war.  
- __Set the max:__ G7 leaders want to cap Russian oil prices to shrink Russia’s oil sales *without* shrinking global supply. Think: countries all agree to pay a lower price for Russian oil. 
- __Going for the gold:__ The G7 needs other nations to participate for the price cap to succeed, and hasn’t finalized the plan. In the meantime, it’s banning Russian gold imports, which earned the country $15B last year.

__IOU…__ Western sanctions are hurting Russia’s access to cash. On Sunday, Russia reportedly [defaulted](https://www.cnbc.com/2022/06/27/russia-on-the-brink-of-historic-debt-default-as-payment-period-expires.html) on $100M of foreign debt payments for the first time in a century — Putin denies it. But Russia’s economy has been relatively resilient: the ruble has rebounded and shelves have stayed [stocked](https://snacks.robinhood.com/newsletters/74Rmw5VlxBTIazWlkKzrHf/articles/6JLig31chFCLXR55AUMuC6/) thanks to domestic production and increased trade with Turkey, India, and China — they’re snapping up Russian oil.

Seven

__It’s a delicate balancing act…__ So far, Western sanctions haven’t shut down Russia’s economy or forced it to end its war. But if enough countries agree to participate in an oil-price cap, they could curb Russia’s oil sales immediately without hurting consumers. It’s not a risk-free strategy: if Russia cuts production in response to the cap, global oil prices could soar even higher.

G7 leaders consider capping Russian oil prices to punish Putin — without punishing everyone else with extra 'flation

As nearly half of US states move to restrict or ban abortion, corporates step in to offer employees support

G7 countries account for 40% of global GDP but just 10% of the world’s population

Corporate’s Roe response

__Recession-omics…__ the word on everyone’s lips. The probability of a US recession [soared](https://www.bloomberg.com/news/articles/2022-06-15/fed-s-inflation-fight-spells-pain-ahead-for-tight-labor-market) this quarter as the Fed aggressively hiked interest rates to tame stubbornly rising inflation. But while #flation hurts the economy, so does *fighting* it: higher rates discourage borrowing/spending and encourage saving, which should cool consumer demand and prices. They also lower companies’ growth expectations, which have slumped stocks into a bear market. And historically [most](https://www.cnbc.com/2020/03/14/not-every-bear-market-is-accompanied-by-an-economic-recession-but-chances-are-high.html) S&P 500 bear markets have been accompanied by recessions. All eyes are on whether the Fed can cool the economy without igniting a downturn — which seems increasingly tougher.

__Crypto winter dawns...__ Move over, web3. "Contagion" became the quarterly buzzword as the crypto market continued to tumble along with stocks, losing $2T in market cap since its November high. Algorithmic stablecoin __TerraUSD's__ crash wiped out $40B in market value seemingly overnight, while crypto lender __Celsius__ froze billions in customer funds. The trouble spread to other crypto companies like __[Coinbase](https://robinhood.com/stocks/COIN)__, __Crypto.com__, and __Gemini__, all of which laid off employees as investors jumped ship. Bipartisan crypto regulation proposed in the Senate could be a win for the struggling industry — though with contentious midterm elections approaching, no one's holding their breath. 

__A tale of two labor markets…__ is the quarter’s biggest paradox. While rebounding sectors like hospitality and travel couldn’t hire fast enough (see: [travel-pocalypse](https://snacks.robinhood.com/newsletters/1Qt2T96PxTPi4D1SE8Gee4/articles/5wYWNmL0OQwFnJ4JDNCU2m/)), pandemic thrivers slowed hiring and cut positions. Unemployment is at [record](https://www.bls.gov/charts/employment-situation/civilian-unemployment-rate.htm) lows and wage growth has doubled from 2019. Still, companies like __[Meta](https://robinhood.com/stocks/META)__, __[Twitter](https://robinhood.com/stocks/TWTR)__, __[Netflix](https://robinhood.com/stocks/NFLX)__, and __[Uber](https://robinhood.com/stocks/UBER)__ have had mass layoffs as slowing growth threatens the bottom line. The tech industry made 8X more job cuts last month than it did during the first four months of the year combined. But with two job openings for every unemployed person, job seekers should be better off than in previous downturns.

A choppy quarter (Mike Hill/Getty Images)

Zoom Out

3 key themes of the quarter…

- __[$156M](https://snacks.robinhood.com/newsletters/71oOBinwjs2uPx02aEH9Xz/articles/58i2EhnWJE0Zzvla002jLS/):__ How much “Top Gun: Maverick” raked in on opening weekend, a Memorial Day record. Movie-ticket sales hit a 40-year low in 2020, but are rebounding as studios send hit franchises like “Batman” to theaters — and ship others to streaming.
- __[3.48%](https://www.cnbc.com/quotes/US10Y):__ The 10-year Treasury yield’s high this quarter, an 11-year record, as investors anticipate more inflation + higher rates. IOUs are getting pricier, from credit-card interest to gov’t bonds.
- __[$280](https://www.coindesk.com/business/2022/04/13/jack-dorseys-first-tweet-nft-went-on-sale-for-48m-it-ended-with-a-top-bid-of-just-280/):__ The highest bid for an NFT of Jack Dorsey’s first tweet in an April auction — a year earlier it had sold for $2.9M (womp). Prices of Bored Apes and other viral NFTs have plummeted with non-fungible trading volume.
- __[$6.1B](https://www.cnbc.com/2022/06/23/russia-ukraine-live-updates.html):__ How much the US has committed to support Ukraine since Russia’s invasion, which has [killed](https://www.nytimes.com/live/2022/06/18/world/ukraine-russia-news-deaths) tens of thousands. The EU recently approved Ukraine’s candidate status to join the bloc, giving the country new hope.
- __[$44B](https://www.cbsnews.com/news/elon-musk-twitter-deal-board-endorsement-qatar-economic-forum/):__ How much Elon Musk [agreed to buy](https://snacks.robinhood.com/newsletters/1zpLKuQGHlxnAe3BYLQXii/articles/2igH2dzMBSwHyPrxwOz4J6/) Twitter for, including a $21B personal investment equaling one-fifth of his net worth. Musk said [three things](https://www.cnbc.com/2022/06/21/elon-musk-says-3-issues-need-to-be-resolved-before-twitter-deal-closes.html) stand in the way of the takeover: fake accounts, debt financing, and shareholder approval.
- __[€0.95](https://snacks.robinhood.com/newsletters/1aPeIVnSAv0nbiyhbzDAM4/articles/7EvckqNHxnZk4b7BnAy6Wi/):__ How many euros one US dollar will get you. The greenback is up 9% this year and has [strengthened](https://www.wsj.com/articles/the-dollar-is-winning-in-a-messy-global-economyand-that-matters-in-the-fight-against-inflation-11652617801) against currencies like the Japanese yen, the Chinese yuan, and the euro. It’s an economic bright spot for the US (and American tourists).

By the #s

6 notable numbers...

__The housing cooldown…__ The days of obsessive __[Zillow](https://robinhood.com/stocks/Z)__-scrolling and cheap mortgages are likely over. Home-buying demand is finally cooling as mortgage rates spike to the [highest](https://edition.cnn.com/2022/05/05/homes/us-mortgage-rates-may-5/index.html#:~:text=The%2030%2Dyear%20fixed%2Drate,from%20this%20time%20last%20year.) levels since ’09. Last month, mortgage applications fell to a 22-year low, while brokers __[Redfin](https://robinhood.com/stocks/RDFN)__ and __[Compass](https://robinhood.com/stocks/COMP)__ had mass layoffs. Average mortgage payments are now 31% [higher](https://www.nytimes.com/2022/06/23/realestate/owning-renting-disparity.html) than rent — which could speed the cooldown. As rates rise, fewer people will be eligible/willing to take out loans. Yet home prices [won’t](https://fortune.com/2022/04/04/redfin-red-hot-housing-market-shows-first-signs-cooling-mortgage-rates/) cool until supply improves, and that could take [years](https://www.nationalmortgagenews.com/news/home-inventory-wont-return-until-at-least-2024-zillow#:~:text=It%20will%20take%20several%20years,of%20experts%20surveyed%20by%20Zillow.). In May, the median existing-home price topped [$400K](https://www.nar.realtor/newsroom/existing-home-sales-fell-3-4-in-may-median-sales-price-surpasses-400000-for-the-first-time) for the first time as inventory remained brutally low. 

__Retail’s inventory glut…__ After years of struggling to get products on shelves, big retailers now have *too much stuff*. __[Walmart](https://robinhood.com/stocks/WMT)__ said nearly a quarter of its inventory is “unwanted” as shipments meant for stay-at-home szn (think: puzzles, throw pillows) arrive months too late. Ditto for teen faves like __[Abercrombie](https://robinhood.com/stocks/ANF)__ and __[American Eagle](https://robinhood.com/stocks/AEO)__, which are sitting on 40%+ more inventory than a year ago. Now the __[Amazon](https://robinhood.com/stocks/AMZN)__ and __[Target](https://robinhood.com/stocks/TGT)__ are having huge sales events to shed extra merch. The discounts could lure stimmy-less shoppers to stores and help cool inflation.

__Knockoff economy…__ In Russia, CoolCola’s the new __[Coca-Cola](https://robinhood.com/stocks/KO)__. Imitation brands are [sprouting](https://www.wsj.com/articles/western-brands-are-up-for-grabs-in-sanctioned-russia-11655870706?mod=business_lead_pos4) up after Western big shots like __[Nike](https://robinhood.com/stocks/NKE)__ and Coke left because of #sanctions. Despite the corporate exodus, Russia’s economy has been surprisingly resilient: the ruble has rebounded to seven-year highs and shelves are still stocked thanks to more domestic production. Former __[McDonald’s](https://robinhood.com/stocks/MCD)__ locations in the country recently [reopened](https://snacks.robinhood.com/newsletters/74Rmw5VlxBTIazWlkKzrHf/articles/6JLig31chFCLXR55AUMuC6/) as rebranded Russian versions, with 98% local ingredients (and the same ketchup packets).

Zoom in

3 emerging trends…

The biz themes that defined this turbulent quarter, from recession-omics to a “crypto winter”

This month in the US the average price of a gallon of gas hit $5 — up by nearly $2 from a year ago

🌊 A rough spell: the Q2 edition

__Non-fungible fanny pack…__ Apes swung into the concrete jungle this week, and their bananas weren't just on the blockchain. The second annual ApeFest, an IRL music festival tied to the popular Bored Ape NFT collection, wrapped up yesterday in NYC (think: Coachella for crypto diehards). Token holders [took over](https://www.vice.com/en/article/z34ep4/this-is-a-great-time-to-buy-nftnyc-attendees-see-opportunity-in-crypto-chaos) Times Square, suggesting that NFTs could survive crypto winter's chill by hitting the pavement.

- __Non-fungible fun:__ Bored Ape Yacht Club NFTs served as event tickets — an IRL use for the sought-after tokens. Performers included LCD Soundsystem, Lil Baby, and Amy Schumer. 
- __Not as fun:__ The fest may not have helped Bored Ape prices, some of which [have crashed 78%](https://decrypt.co/102905/bored-ape-ethereum-nfts-drop-below-100k-first-time-almost-year) from their April highs. It’s a theme: top NFT collections like Doodles and Meebits are also down big-time. 

__Can’t funge this…__ The “right-click, save” crowd may be prevailing over NFT promoters. Despite [contradicting](https://www.wsj.com/articles/nft-sales-are-flatlining-11651552616) [reports](https://blog.chainalysis.com/reports/chainalysis-web3-report-preview-nfts/) over whether the NFT market collapsed earlier this year, the bear market hasn't done NFT collectors any favors. Trading volume has plummeted to its lowest point since June of last year. But that hasn't killed corporate token interest: 

- __Exclusive:__ On Wednesday, ecomm behemoth __[Shopify](https://robinhood.com/stocks/SHOP)__ [announced](https://www.protocol.com/shopify-nft) "token gating" as a way for merchants to give NFT holders access to exclusive IRL shopping events.

NFTs take the Big Ape-le (Noam Galai/Getty Images)

APED

__Real-world uses ≠ users…__ While NFT event tickets show digital assets aren’t limited to blockchain transactions, they haven’t created mainstream appeal. Thousands of token fans rocked out at ApeFest, but as of January most NFTs were owned by just a few hundred thousand people. Perhaps efforts like Shopify's to make tokens part of daily life could change that.

ApeFest tosses NFTs into the real world as digital tokens come for brick-and-mortar events

__Bad aftertaste…__ Warning: this news may cause indigestion. You’ve probably heard of __Daily Harvest__, the plant-based meal-delivery service that seems to sponsor every other YouTuber and podcaster. Now some influencers are losing their appetites: Daily Harvest is [embroiled](https://www.wsj.com/articles/daily-harvest-recalls-lentil-and-leek-crumbles-after-customers-report-getting-sick-11655924044?mod=business_featst_pos2) in a scandal after several customers said they’d gotten sick after eating its lentils. 

- __Violently ill:__ On __Reddit__, __TikTok__, and Insta, customers said they got sick after eating DH’s Lentil + Leek Crumbles. Many reported liver damage and fevers, and some said they had their gallbladders removed. 
- __#LentilGate:__ According to Reddit users, DH first responded to customer concerns by asking if they’d cooked the lentils correctly. The company later issued a recall and said it was investigating the mysterious issue, along with the FDA. It’s also offering customers a $10 credit (womp). 

__Hungry for influence…__ Before this brand-crushing debacle, DH was thriving. It had sold $250M of meal subscriptions in 2020 and hit a $1.1B valuation thanks to its army of influencers and celeb investors (like: Serena Williams, Gwyneth Paltrow, and Bobby Flay). It’s not the only one relying on influencers: 

- __#SponsoredContent:__ Brands are expected to spend $16.4B on influencer marketing this year as consumers increasingly discover products on TikTok and Insta. 
- __#ZaraHaul:__ Last year, Insta influencers mentioned Zara 300K times, reaching 2M+ people. Smaller brands like __Glossier__ and __MVMT__ have also relied on influencers to boost awareness.

Crumble

__Viral marketing can be a double-edged sword…__ Social media can help startups blow up quickly and cause them to blow up (in a bad way) just as fast. Some Daily Harvest influencers who said they got sick from free meal kits are bashing the biz on social (see: this [Tok](https://www.tiktok.com/@abby.silverman/video/7110783566761561386) with 100K+ likes). Daily Harvest’s crisis is a reminder that the influencer strategy can backfire.

Viral meal-delivery service Daily Harvest is taking heat after some of its lentil influencers and customers said they got sick

Fourth of July BBQs are going to cost 21% more this year because of inflation

🐵 NFTs take NYC

__Empty pod…__ Juul’s empire could be disappearing in a cloud of mango-flavored vapor. Yesterday WSJ [reported](https://www.wsj.com/articles/fda-to-order-juul-e-cigarettes-off-u-s-market-11655904689) that the FDA plans to ban Juul in the US. Refresher: In 2020 the FDA asked smoke juggernauts to apply to sell e-cigs (even un-flavored ones). Fast-forward to now: __[British American Tobacco](https://robinhood.com/stocks/BTI)’s__ Vuse — which just unseated Juul as the top US vape — got approved to stay on the market. But it sounds like Juul’s 125K-page application *hasn’t*.

- __Glory daze:__ Juul became the top US e-cig seller in 2018, three years after launching its sleek vapes. That year, Marlboro maker __[Altria](https://robinhood.com/stocks/MO)__ splurged $12.8B for a 35% stake in Juul, which was threatening its cig biz. Then…
- __Things went up in smoke:__ The FDA banned flavored e-cigs in 2020 while investigating whether companies were marketing to kids, who were getting hooked on USB-like vapes.
- __Puff, puff, plunge:__ Juul ditched flavored pods and its e-cig market share [plummeted](https://www.nytimes.com/2021/07/05/health/juul-vaping-fda.html#:~:text=Juul's%20share%20of%20the%20vaping,and%20expand%20its%20reach%20again.) from 75% to 42%. Altria’s $13B Juul stake was worth just $1.6B as of March. Now it could lose its US biz. 

__Burned on both ends…__ Last week the FDA announced separate plans to limit addictive nicotine in traditional cigs. The rule isn’t expected to go into effect for years, if at all. But regulatory heat could hurt cig sales, which are already [forecast](https://www.wsj.com/articles/biden-administration-targets-removal-of-most-nicotine-from-cigarettes-11655842130?mod=business_lead_pos12) to fall to $95B this year from $99B last year. For Altria it’s a double whammy.

The FDA’s big warning label (Mario Tama/Getty Images)

Burnt

__Regulators don’t like getting burned…__ neither do investors. The FDA says Juul ignored its warnings on marketing. Altria’s stock has fallen 13% this year while it’s tried to save Juul. But shares of rivals BAT and __[Philip Morris International](https://robinhood.com/stocks/PM)__ are up as they’ve shifted focus to “smokeless” tobacco [products](https://snacks.robinhood.com/newsletters/CxZPNYACQmhAcH97Htdw6/articles/4g0VxGDmv3EbCjtFiFJMZ9/), like IQOS, and avoided regulatory drama with vapes.

The FDA may ban Juul in the US, dealing tobacco giant Altria a double whammy

__New CBD candle launch…__ #retweet. __[Shopify](https://robinhood.com/stocks/SHOP)__ and __[Twitter](https://robinhood.com/stocks/TWTR)__ have joined forces to help tweeters shop while scrolling. Shopify powers online sales for merchants like __[Allbirds](https://robinhood.com/stocks/BIRDS)__, [Heinz](https://robinhood.com/stocks/KHC), and your local succulent shop. It already controls over a [10th](https://www.drip.com/blog/shopify-statistics#:~:text=at%204.29%20Percent-,1.,in%20third%20at%2010.98%20percent.) of the global ecommerce market, and now it could get more: 

- __Check in:__ Twitter’s giving Shopify merchants the option to display up to 50 products on their profiles, plus features like live-stream hauls. Shopify’s paying Twitter for the perks. 
- __Check out:__ Shopify thrived mid-pandemic when businesses moved online. But the [stock](https://robinhood.com/stocks/SHOP) has slid 75% this year while sales growth has slowed for four quarters straight.

__Viral Tok ad > TV spot…__ As ad revenue slows, social giants are expanding shopping features to drive more $$. Creatively named launches include “Insta Shop,” “Twitter Shops,” and “__TikTok__ Shopping.” While social commerce still makes up less than 5% of online shopping, it’s growing fast: 

- __4X:__ Shopify said that orders placed through social apps like __[Snap](https://robinhood.com/stocks/SNAP)__ and TikTok quadrupled last quarter from a year ago.

Scrolly

__Big biz is moving from D2C to C2C…__ from direct to consumer to connect to consumer. It’s not enough for companies to have a website, one-click [checkout](https://apps.shopify.com/one-click-checkout), and shipping. To really connect, brands have to be where consumers are *most connected* (i.e.: social). That’s why US social sales could [hit](https://www.wsj.com/articles/twitter-adds-shopping-feature-for-shopify-merchants-11655899201) $168B by 2027 — nearly five times bigger than last year.

Twitter and Shopify team up to expand social shopping features as consumers splurge through their feeds

The cost of raw materials for EVs has more than doubled during the pandemic

💨 Juul’s last puff?

__Pringle and ready to mingle…__ Frosted Flakes and Pringles are breaking up. Cereal icon __[Kellogg](https://robinhood.com/stocks/K)__ said it’s [splitting](https://www.wsj.com/articles/kellogg-to-separate-into-three-businesses-11655810600) into three publicly traded companies: snacks, cereal, and plant-based meat (think: MorningStar patties). Kellogg became a snack giant thanks to faves like Cheez-Its and RxBars. Now it’s spinning off categories in hopes that specificity will boost *profitability*. The three biz lines are expected to go solo next year. 

- __Pop Tart-ed:__ Kellogg stock popped 2% yesterday and is up 6% this year as shoppers keep buying Rice Krispies despite inflation and smaller boxes (#shrinkflation). 

__Cereal killer…__ Kellogg’s cereal sales have been slipping for years as Americans ditch Fruit Loops for less neon-colored options. But snacking is on the up and up after spiking during lockdowns. Now: 

- __Snacks make up 80% of Kellogg’s sales__ and are growing faster than cereals and plant-based foods. Snacks boosted Kellogg’s profit last quarter, so it’s spinning them off to double down. 
- __Solo snacks have succeeded before:__ A decade ago, __[Kraft](https://robinhood.com/stocks/KHC)__ spun off its snack brands (Oreo, Triscuits) into a new public company called __[Mondelez](https://robinhood.com/stocks/MDLZ)__: today Mondelez’s market cap is twice Kraft-Heinz’s — and now it's [buying](https://www.cnn.com/2022/06/21/business/mondelez-clif-bar/index.html) __Clif Bar__ for nearly $3B.

Tony the Tiger’s going public (Bill Pugliano/Getty Images)

Flake

__Broader isn’t always better…__ Sometimes cereal problems should *stay* in the cereal aisle. With the split, Kellogg hopes to boost cereal margins (by fixing supply issues), expand plant-based market share (by attracting pure-play investors), and boost snack profits (by investing in new varieties). The strategy’s taking off: __[GE](https://robinhood.com/stocks/GE)__ and __[Johnson & Johnson](https://robinhood.com/stocks/JNJ)__ are breaking up biz categories in an attempt to boost profits, and __[Ford](https://robinhood.com/stocks/F)__ and __[Volvo](https://robinhood.com/stocks/VLVLY)__ plan to spin off their EV businesses.

Kellogg plans to split into 3 companies to unleash the power of its snack biz — and reinvigorate its cereal

__Camping out at the airport [Starbucks](https://robinhood.com/stocks/SBUX)...__ Your plane might not arrive, but at least there are cake pops. A new federal holiday + Father's Day + national labor shortage = the perfect recipe for a travel-pocalypse. US airlines have canceled or delayed [35K+](https://ca.finance.yahoo.com/news/us-airlines-canceled-delayed-more-234356100.html) flights since Thursday, a #fail that’s becoming a theme as travel rebounds.

- __Nearly a third of scheduled flights__ on Thursday and Friday were delayed (and 3K+ were canceled). __[Delta](https://robinhood.com/stocks/DAL)__, __[American](https://robinhood.com/stocks/AAL)__, and __[Southwest](https://robinhood.com/stocks/LUV)__ experienced the most disruption.
- __Airlines mostly blamed staffing shortages.__ After offering pilots and flight attendants buyouts or early retirements mid-pandemic, they're struggling to staff up again.
- __Meanwhile: TSA traveler volumes__ are [cruising](https://www.tsa.gov/coronavirus/passenger-throughput) near pre-pandemic levels, and notched a pandemic high over the weekend.

__Postponed till next summer...__ Yesterday was the first day of summer, but airlines have been feeling the heat for a while. Back in April 2020, airlines got [$25B](https://snacks.robinhood.com/newsletters/XFl10uA56LUjXq5vweRtc/articles/5B4WtFBkJTYQdMwixAwHFk/) in bailouts from the US gov't so they could continue paying their hundreds of thousands of employees. Under the terms, airlines couldn't make any job cuts until October 2020. Cue October, and tens of thousands were [furloughed](https://www.axios.com/2022/06/19/airlines-flights-staff-shortages-delays-summer-vacation) or cut.

- __Many are frustrated__ that after nearly three years and billions in government aid, airlines can't get their shifts together to serve returning travelers.
- __Transportation Secretary__ Pete Buttigieg is [considering](https://www.businessinsider.com/us-may-punish-airlines-for-flight-delays-cancellations-buttigieg-2022-6?inline-endstory-related-recommendations=&utm_medium=referral&utm_source=yahoo.com) punishments (think: fines) for airlines that don't stick to their summer flight schedules.

Late

__Ramping up’s harder than ramping down…__ When demand was corona-crushed, airlines skimmed their workforces too much. Now they’re offering incentives to get people back: American has [offered](https://www.dallasnews.com/business/airlines/2022/06/15/american-airlines-gives-raises-bonuses-to-regional-flight-attendants-too/) rounds of raises and bonuses to regional employees, while __[Alaska](https://robinhood.com/stocks/ALK)__ and __[United](https://robinhood.com/stocks/UAL)__ are offering aspiring pilots financial aid at newly opened flight-training schools. But it could be too little too late: airline staff shortages could [last](https://www.axios.com/2022/06/19/airlines-flights-staff-shortages-delays-summer-vacation) well into next year.

Travel-pocalypse 2022 reaches a fresh boiling points as airlines struggle to bring workers back

Cereal icon Kellogg plans to split into 3 companies to unleash its snack power

Marilynn “Lynn” Malerba is set to become the first Native American US Treasurer

🥣 Kellogg splits up

__The sun also rises...__ the stocks, not so much. The S&P 500 is down 23% this year after stocks slipped deeper into a bear market last week. ICYMI: the Fed went off script and hiked interest rates by three-quarters of a percentage point (higher than the half point originally expected). Fed Chair Powell (#JPow) [said](https://www.cnbc.com/2022/06/15/powell-says-the-fed-could-hike-rates-by-0point75-percentage-point-again-in-july.html) we could get another big hike in July.

- __Inflation__ was up a worse-than-expected 8.6% in May from last year. Now JPow's leaning further into higher interest rates, which discourage borrowing/spending (think: high credit-card interest) and encourage saving (think: higher yields).
- __Higher rates__ cool consumer demand, which should cool prices. But they also lower companies’ earnings-growth expectations, which lowers corporate valuations (see: slumping stocks).
- __The 10-year Treasury yield__ [topped](https://www.cnbc.com/2022/06/14/us-bonds-10-year-treasury-yield-in-focus-ahead-of-fed-meeting.html) its highest level in over a decade last week as investors anticipate more inflation + higher rates. When yields rise, US gov’t bonds become more attractive relative to riskier investments like stocks.

__The market looks forward...__ We know the economy isn't the stock market. Prime example: mid-2020, the market was sipping prosecco on a Hamptons yacht (records on records) while the economy was eating __Safeway__ frozen peas in bed (record GDP shrinkage). Cue: trillions in stimmy $$, disappearing interest rates, and a big econ rebound. Now:

- __Yay area:__ The tight labor market is looking strong with ultralow unemployment, and manufacturing [ramped up](https://www.dailyfx.com/forex/fundamental/article/special_report/2022/06/01/SP-500-Sags-as-Strong-US-Manufacturing-Data-Sparks-Surge-in-Treasury-Yields.html) last month despite supply snags. 
- __Gray area:__ We're starting to see more layoffs as the Fed tightens its belt, and consumer spending surprisingly [fell](https://www.cnbc.com/2022/06/15/retail-sales-may-2022-unexpected-0point3percent-decline-hammered-by-inflation.html) in May as inflation strained savings.
- __Nay area:__ The Fed slashed its outlook for 2022 economic growth (to 1.7% from 2.8%), and the risk of a recession has [soared](https://www.bloomberg.com/news/articles/2022-06-15/fed-s-inflation-fight-spells-pain-ahead-for-tight-labor-market).

The market walking ahead of the economy (Owen Smith/Getty Images)

Grizzly

__It’s the econ-flation paradox…__ Inflation hurts the economy, but so does *fighting* inflation. To tame enemy #1, central banks need to *slow* the economy (which is sinking stocks). The sweet spot: cooling the economy *without* causing a recession and igniting a market meltdown. The best news could be if prices (especially oil and gas) show significant signs of easing.

As the Fed tries to tame enemy #1, stocks are in the red — but the economy’s stuck in a gray zone

__Falling far from the tree...__ __[Apple’s](https://robinhood.com/stocks/AAPL)__ supply chain. The Fruit’s sleek gadgets are nearly all manufactured in China. But China's work-stopping zero-Covid policy [could](https://www.wsj.com/articles/apple-aapl-q2-earnings-report-2022-11651115203) cost Apple $8B in sales this quarter. Now some businesses are fleeing the country: __Foxconn__, the company that assembles most iPhones, is moving more of its production to nearby Vietnam and Taiwan. A wider manufacturing exodus could hurt China’s economy, which is already on pace for its slowest annual growth in decades.

__The biggest pro sports matchup…__ is happening *off* the field. Streamers are seeing live sports as a key to turn fickle viewers into loyal fans. Last week Apple [signed](https://www.wsj.com/articles/apple-major-league-soccer-strike-10-year-streaming-deal-for-all-mls-games-11655222431) an exclusive $2.5B deal to stream all Major League Soccer for 10 years, the first time a full US pro season will be streamable in one place (+ cable). This year __[Amazon](https://robinhood.com/stocks/AMZN)__ and Apple will stream some NFL and MLB games. __[Disney](https://robinhood.com/stocks/DIS)__ and __[Sony](https://robinhood.com/stocks/SONY)__ fought to stream India’s pro cricket league (but lost their bids). And __[Netflix](https://robinhood.com/stocks/NFLX)__, which is losing subs, is racing Amazon and NBC for Formula One rights.

Stories we’re watching...

__Movin’ back in with Mom…__ Millions of Americans raced to buy their dream homes last year — now that dream is impossible for many. Soaring mortgage rates, low inventory, and sky-high prices are finally cooling the hot housing market. Mortgage applications fell to a 22-year low last month, and online brokers __[Compass](https://robinhood.com/stocks/COMP)__ and __[Redfin](https://robinhood.com/stocks/RDFN)__ did mass layoffs last week. Homebuilding giants __[Lennar](https://robinhood.com/stocks/LEN)__ and __[KB Home](https://robinhood.com/stocks/KBH)__ saw sales dip from records last quarter (we’ll get fresh earnings this week). Still, experts say it could take years for home prices to really cool.

__Need Thrifty-er ice cream…__ __[Rite Aid’s](https://robinhood.com/stocks/RAD)__ losses deepened last quarter after it took on [debt](https://fortune.com/2022/06/14/rite-aid-turnaround-plan-cvs-walgreens-pharmacy-industry/) to build more pharmacies, while its drugstore rivals invested in profitable ventures (think: wellness clinics, insurance partnerships). Earnings jumped at __[CVS](https://robinhood.com/stocks/CVS)__ and __[Walgreens](https://robinhood.com/stocks/WBA)__ as Covid tests and vaxxes continued (though fewer), and __[Pfizer’s](https://robinhood.com/stocks/PFE)__ Covid pill boosted sales. While CVS and Walgreens boosted their earnings forecasts for this year, Rite Aid — which reports Thursday — expects sales to dip despite rising store visits as it cut costs.

Events

Coming up this week...

- __[Billions](https://www.forbes.com/self-made-women/):__ The names topping Forbes’ list of richest self-made women may surprise you. It’s not celeb-preneurs like Rihanna or tech execs like Sheryl Sandberg — it’s roofing, trucking, and pizza magnates. 
- __[OOO](https://www.nytimes.com/2022/06/13/business/covid-sick-days.html):__ Covid ran roughshod over the sick day as WFH became WWS (Work While Sick). The Zoom-from-couch life exacerbated an American attitude — the insistence to work through it, even when it’s Covid. 
- __[Land](https://blog.chainalysis.com/reports/how-terrausd-collapsed/):__ __TerraUSD's__ collapse caused crypto chaos, but data suggests the stablecoin wasn't responsible for “crypto winter.” Instead, __[bitcoin](https://robinhood.com/crypto/BTC/)__ may’ve followed stocks — dashing hopes that the crypto would be a safe haven.

ICYMI

Last week's highlights...

As the Fed tries to tame enemy #1, stocks are in the red — but the economy’s in a gray zone

June 21 (aka: summer solstice) is the longest day of the year in the Northern Hemisphere

🎈 #flated problems

__So many rainbow logos…__ This [Pride Month](https://www.them.us/story/the-complete-history-of-pride), a lot of companies are showing support through [cheeky ad campaigns](https://www.out.com/pride/2022/6/03/burger-kings-pride-whoppers-come-two-tops-or-two-bottoms), social posts, and logos (think: __[Uber’s](https://robinhood.com/stocks/UBER)__ rainbow cars in its app). On Wednesday, President Biden signed an [executive order](https://www.whitehouse.gov/briefing-room/presidential-actions/2022/06/15/executive-order-on-advancing-equality-for-lesbian-gay-bisexual-transgender-queer-and-intersex-individuals/) geared toward protecting the record-breaking [7%](https://news.gallup.com/poll/389792/lgbt-identification-ticks-up.aspx) of American adults — and 21% of Gen Z adults — who identify as LGBTQ+. But the community’s weathering a harsh climate: 

- __State legislators__ have proposed an unprecedented ~300 [anti-LGBTQ+ bills](https://www.hrc.org/campaigns/the-state-legislative-attack-on-lgbtq-people#state-legislative-tracker-map) this year — many targeting transgender people and their access to healthcare. 
- __Meanwhile:__ The leaked Supreme Court [draft opinion](https://www.reuters.com/world/us/gay-marriage-other-rights-risk-after-us-supreme-court-abortion-move-2022-05-04/) that could overturn Roe v. Wade has [raised concerns](https://apnews.com/article/abortion-biden-us-supreme-court-right-to-privacy-6e1d7ee2a6d26bef09392971fd4948b5) over the future of same-sex marriage.

__Pride for sale...__ Corporate Pride participation [has surged](https://www.bcg.com/publications/2020/inclusive-cultures-must-follow-new-lgbtq-workforce) as companies seek to promote inclusive images. But many of the companies sponsoring parade floats also fund lawmakers who support anti-LGBTQ+ legislation. Powerhouses like __[Amazon](https://robinhood.com/stocks/AMZN)__, __[AT&T](https://robinhood.com/stocks/T)__, and __[Comcast](https://robinhood.com/stocks/CMCSA)__ have [collectively donated](https://www.dataforprogress.org/accountable-allies) ~$3M to anti-LGBTQ+ causes in recent years. Meanwhile, companies that’ve spoken out against anti-LGBTQ+ bills have done so inconsistently:

- __[Apple](https://robinhood.com/stocks/AAPL)__ [quietly](https://www.politico.com/news/2022/04/01/apple-lobbying-anti-lgbtq-laws-00022127) lobbies against anti-LGBTQ+ legislation under the leadership of Tim Cook, America’s most prominent publicly gay CEO. It’s the only company that [lobbied](https://www.legis.iowa.gov/lobbyist/reports/declarations?ga=89&ba=HF2416) against an Iowa bill that bars trans girls and women from participating in K-12 and collegiate sports.
- __[Disney](https://robinhood.com/stocks/DIS)__ chose not to take a public stance on Florida’s [“Don’t Say Gay”](https://time.com/6176224/florida-dont-say-gay-history-lgbtq-rights/) bill until it [passed](https://www.npr.org/2022/03/08/1085130633/disney-response-florida-bill-dont-say-gay). When employees protested, Disney announced it would donate $5M to LGBTQ+ orgs like the Human Rights Campaign. But the HRC [rejected](https://www.hrc.org/press-releases/human-rights-campaign-refuses-money-from-disney-until-meaningful-action-is-taken-to-combat-floridas-dont-say-gay-or-trans-bill) the funds, and Gov. Ron DeSantis [revoked](https://www.politico.com/news/2022/04/22/desantis-disney-special-status-dont-say-gay-00027302) Disney’s special tax status.

A Pride protest near NYC’s Stonewall Inn (Bryan R. Smith/AFP via Getty Images)

Pride

__Rainbow capitalism is a tough sell…__ and logos aren’t enough. An overwhelming [93%](https://news.gallup.com/poll/1651/gay-lesbian-rights.aspx#:~:text=May%2015%2D30-,93,-5) of Americans believe LGBTQ+ people should have equal work opportunities, but [nearly half](https://williamsinstitute.law.ucla.edu/press/workplace-discrim-press-release/) of LGBTQ+ workers have experienced unfair treatment at work — including being fired, not hired, or harassed because of their identity. Now a growing number of workers and consumers expect employers to prevent anti-LGBTQ legislation and provide an equitable workplace.

Rainbow capitalism is all the rage this Pride Month, but the workforce of tomorrow expects more activism

__Should’ve gone with waterproof mascara…__ for the Chapter 11 tears. Cosmetics giant __[Revlon](https://robinhood.com/stocks/REV)__ officially [filed](https://www.cnbc.com/2022/06/16/cosmetics-giant-revlon-files-for-chapter-11-bankruptcy-protection.html) for bankruptcy protection yesterday. Decades ago, Revlon was the second-largest beauty company and the first to feature a Black model. But when people ditched matte lipstick for masks in 2020, the 90-year-old biz barely avoided bankruptcy. Even though cosmetic sales are nearly back to pre-pandemic levels, things have gotten worse at Revlon:

- __Difficulty level = winged eyeliner:__ Revlon can’t fill a third of its orders (#supply-probs) and has $3.3B in debt to boot. Sales ticked up last quarter, but it’s still losing $$.
- __Kiss and makeup:__ Now Revlon expects $575M from lenders to save its brand, which it says is still in demand.

__Killed by Kylie…__ For decades, Revlon has sold most of its makeup in drugstores and malls. But the new generation discovers products on __TikTok__, not at __[CVS](https://robinhood.com/stocks/CVS)__. Now Revlon is losing customers to glossier names: the “tap to buy” trend has helped online-first brands like __Kylie Cosmetics__, __Glossier__, and Rihanna’s __Fenty Beauty__. Gen Z favorite __[E.L.F.](https://robinhood.com/stocks/ELF)__ crushed sales expectations last quarter thanks to social collabs with brands like Dunkin’.

__Even fellow legacy brand__ __[Estée Lauder](https://robinhood.com/stocks/EL)__ is faring better than Revlon (and is profitable), partly thanks to ecomm investments like viral skincare brand The Ordinary.

Smoky

__You can’t conceal billions in debt…__ Revlon was the first major brand to file for bankruptcy this year, but likely won’t be the last. Last year, nonfinancial US companies took on a record $1.7T of debt when interest rates were near zero. Now soaring interest will make it pricier for cash-strapped companies like __[Peloton](https://robinhood.com/stocks/PTON)__, __[Affirm](https://robinhood.com/stocks/AFRM)__, and __Just Eat__ to pay back IOUs.

Makeup mainstay Revlon files for bankruptcy protection — and other debt-plagued darlings could follow

Rainbow capitalism is rising, but the workforce of tomorrow expects more corporate activism

Pride Month was chosen to commemorate the Stonewall Riots, which took place in NYC on June 28, 1969