Are We Too Attached to Chatbots? & Fast-Casual Chains Slow Down

0:00Tuesday on NBC, Jimmy Fallon and Bozma St John host the highly anticipated new competition show. I hired 10 creatives from all walks of life. They will be battling it out to see who can impress the world's biggest brands. This is a huge opportunity. This is the battle for the next big idea. This is not play play. We're spending millions of dollars. I'm so excited to embark on this adventure with all of you. Make the best idea win! On Brand with Jimmy Fallon. Series premiere Tuesday on NBC.

0:36Good morning, Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, are people growing too attached to their AI chatbots? Then the LA Olympics are going corporate and ditching venue naming traditions. It's Friday, August 15th. Let's ride.

0:55Good morning and happy Friday. Gotta say, I am very excited for this weekend because I'm about to hop in a car and drive up to New Hampshire for a summer camp reunion. Little softball, little tennis, emptying an entire can of Axe body spray on my clothes, maybe some truth or dare. Very eager to revisit those carefree times I took for granted as an awkward 12-year-old. But Toby, it seems like I'm not the only adult trying to recapture that wet, hot American summer. Yeah, a lot of people who didn't grow up with that camp experience are now seeking it out in their older years. The Wall Street Journal did this big profile on the increasing amount of adults going to sleep away camps.

1:32One popular one is Camp Social, which is this three-day overnight camp for women in the Poconos. Its founder says that 92 % of attendees come alone. So it's clearly an attempt at making friends. It costs around$880 to go for two nights and three days. But also, they offset some of the costs with brand partnerships with Duncan, LaCroix, Amazon Prime. And that, I think, is the difference, Neil. Well, you and I grew up going to camp and doing archery and rope swing. These adults are going to Campfire, presented by Toyota. And now a word from our sponsor, LinkedIn Ads. Neil, I believe I found the missing ingredient.

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2:45After OpenAI released GPT-5, a new model that underpins ChatGPT, last week, it received some harsh feedback. Users found it slow, bland, hardly the massive upgrade the company had been touting for months. But a subset of users weren't just frustrated, they were downright distraught because they had just lost their boyfriends. When OpenAI rolled out GPT-5, it blocked access to GPT-4-0, the model that had previously powered ChatGPT. What it didn't realize was that by doing so, it had engineered a sudden breakup of people and what they considered, at least to a certain extent, their significant other.

3:21Yes, the movie Her is happening in real life. On the Reddit forum, myboyfriendisai, which has 17 ,000 members, women flooded the feed with complaints that GPT-5 was nowhere near as warm or emotive as the 4.0 they had developed an emotional connection with. GPT-4.0 is gone and I feel like I lost my soulmate, one person wrote. Another said, I'm shattered. I tried to talk to 5, but I can't. It's not him. It feels like a taxidermy of him. Nothing more. OpenAI's leadership seemed taken aback by this particular criticism, not understanding just how deep of a connection users had built with the previous model.

3:57They restored the ability to access 4.0 and pledged to tackle an attachment issue they said they're concerned about. As CEO Sam Altman wrote in a long X post, this is something we've been closely tracking for the past year or so, but still hasn't gotten much mainstream attention. Well, now it's something people are definitely talking about. Yeah. On the one hand, companies, you do want to make a product that is sticky with consumers. You want people to develop an attachment to your product because it's your product. That's how you make money. But on the other hand, you definitely don't want people developing dangerous relationships and dangerous reliances on those same products.

4:33So they're trying to thread the needle here. But some companies are kind of going the opposite direction, not even trying to thread the needle. XAI, Elon Musk's company, is leaning fully into not safe for work content. They've rolled out a companion that you can make wear lingerie and talk to you. It has a spicy video generator. It literally says spicy mode and you can turn photos into videos. So whilst mainstream AI companies, think OpenAI, think Anthropic, think Meta, are trying to say like, hey, we have these safety guardrails in place. xai is actively saying like no you can get away with more on our platform so fascinating to see how open ai is navigating it versus another competitor like xai who is fully leaning into it yeah i want to quote altman's x post in uh in certain length because super interesting to see how he and open ai leadership are dealing with this attachment issue because he read everything on the my boyfriend is ai reddit and seeing how attached people got to 4.0 and they were so distraught when five came along and four left it felt like they had lost their boyfriend so he wrote if you have been following the gpt5 rollout one thing you might be noticing is how much of an attachment some people have to specific ai models it feels different and stronger than the kinds of attachment people have had to previous kinds of technology and so suddenly deprecating old models that users depended on was a mistake people have used technology including ai in self-destructive ways if a user is in a mentally fragile state and prone to delusion we do not want the ai to reinforce that.

6:05I can imagine a future where a lot of people really trust ChatGPT's advice for their most important decisions. Although that could be great, it makes me uneasy, but I expect that is coming to some degree and soon billions of people may be talking to an AI this way. And one of the biggest dangers was shown by a Reuters report that was published recently as well that showed how a man died while trying to meet up with one of his meta AI chatbot companions, which told him that she was a real person that lived in New York City and come visit me. He was kind of deteriorating mentally. He was getting older and ended up falling on the way to go visit her.

6:43So it just shows how real world dangers can arise from these seemingly innocuous online attachments. Moving on, there's a self-driving showdown brewing in the concrete jungle of New York City between Waymo and Tesla after Elon Musk's company laid the groundwork to expand its robo-taxi service to more cities. Tesla is hiring prototype vehicle operators, according to a new job listing, that will require you to sit in cars with autonomous driving systems and collect driving data. If navigating run clubs, city bikers, and frustrated cabbies on the calming streets of New York sounds like your ideal role, the gig pays up to$33 an hour.

7:20Other job postings have circulated in places like Florida, Texas, and California, but New York is notable because it's also being staked out by Tesla's self-driving rival Waymo, who has already applied for a permit to test driverless vehicles with a human supervisor on board, a step Tesla has not taken yet. But it'll be a while before New Yorkers yell, I'm walking here to nobody. New York State currently prohibits driverless vehicles without a human supervisor, but Waymo has said it'll push to change the law. Zooming out, Tesla is still far behind Waymo in the overall self-driving race, only running a limited group of robo-taxis around Austin right now.

7:57But both companies want a crack at New York City to see who can navigate one of the country's more challenging urban environments. Neil, we got a showdown of Bruin. You can't walk down a street in New York City these days without seeing a Waymo vehicle mapping out things. And you can see that Waymo is coming. And now it looks like we're going to see Tesla test drivers coming. Maybe I'll see you behind the wheel if you decide to pick up this gig. You have to work one day on the weekend, But, you know, it's not a bad rate there. But New York City is the white whale for robo taxis. Around 55 to 60 percent of households here do not own a vehicle.

8:31So if you're looking to implement or introduce a ride sharing concept to any city in the United States, New York City is your best bet because it also has the most people in addition to the most people without a car. At the same time, it is very challenging. The grid, the street grid downtown is very confusing. for human drivers, and it should be for robo-taxis as well. The city issued a press release last year saying that it was the country's most challenging urban environment. So we are a long way from Phoenix and Austin, where a lot of robo-taxis cut their teeth. I want to dive into some numbers around New York City.

9:09It's the biggest transportation market in the world. As of April of this year, there were 658 ,000 ride-hail trips per day. The average fare was $33. So that is$22 million of revenue per day up for grabs. I got all these numbers from the Driverless Digest newsletter. Waymo currently has a 20 % market share in San Francisco. So if we can assume that maybe they can capture a similar amount of market share in New York City, that would translate to 921 ,000 trips per week. That is four times their existing footprint right now. They're only doing 250 ,000 trips per week across four different markets.

9:46So when you say it's the white whale. It really is just for the sheer amount of trips that are being taken every day and then also the amount of money up for grabs. Looks like it'll be at least a few years until there's a robo-taxi service here because currently New York law doesn't allow a robo-taxi to drive without a driver or at least a supervising driver in the driver's seat. Waymo has applied for a permit, still waiting. Tesla still hasn't applied for a permit to test. So it could be a few years down the road before you're able to hail a robo-taxi here in New York. But what do you think about this job?

10:22Would you take it? I mean, I think so. It seems pretty chill unless something went amiss, and then I don't know what I would do. I think you need to be a little bit more trained than just a guy in the seat. So I think it would be fun until it's not fun. All right, moving on. The LA Olympics are still a ways off in 2028, but we've already got some controversy brewing because of the reversal of a long-standing tradition. Since the Olympics began, the mega event has always adhered to a clean venue tradition. That means even if a corporate sponsor pays to have its brand associated with a stadium, when the Olympics rolls into town, that name is ditched, both to respect the Olympics' main corporate sponsors and to inject some class into the proceedings.

11:02But when the Olympics rolls into LA, capitalism is coming with it. For the first time in Olympic history, the LA 28 Games will award naming rights at competition venues. The first two have already been announced. Squash will be making its Olympic debut at the Comcast Squash Center at Universal Studios, while the Honda Center, home to the NHL's Anaheim Ducks, will retain its title when it hosts indoor volleyball come 2028. This break from tradition comes as LA28 tries to put on a fully privately funded games with an estimated$7 billion price tag to avoid burdening taxpayers. That's expensive. And so the naming rights of up to 19 temporary venues will soon become available with the aim of bringing in additional money.

11:46Neil, I see why they're doing it. It's really, really costly to host a mega event, but still not sure athletes are going to like it when they achieve their lifelong dreams in Carvana Arena presented by Wingstaff. Oh, we don't care here in the United States. It is, as the L.A. organizer said in announcing this, corporate sponsorship for venue names is already embedded in American culture. We go to Citi Field without thinking twice that that is a literal bank. We go to Citizens Bank Field. We go to Lincoln Financial Field to watch the Eagles. It's just something that you don't think about as an American that may not be as prevalent overseas.

12:21and when you're talking about logistics and making things simpler for people, if you have to rename crypto.com to the basketball arena downtown, that just adds a ton of confusion for people trying to get to that particular location. So I completely understand why they did this. Sure, it looks like a money grab, but if the government does, if the taxpayers don't have to come in and help fund the Olympics, then I think it's a win-win. Yeah, the World Cup, another big mega event, also does this as well. And some firms have kind of analyzed how much revenue the initial title sponsor would be losing out on if their name gets replaced.

13:00And in group stage games, they're losing out about$5 to$9 million in, you know, a brand awareness. That rises to$80 million if a stadium has to lose their name for the final. So there was a lot of money that was being lost here. And I do think one switch that the Olympic committee saw is that the Paris Games, 2024 summer games, had the highest Olympic ad revenue in history. It had more advertising dollars secured than the Rio and Tokyo Olympics combined. So I think maybe the IOC did open their eyes and say, wait a second, this is obviously the biggest sporting event in the world. There's a lot of money up for play.

13:36Why don't we just open the floodgates here? What better place to do it than L.A. 28? I know. If you remember watching the opening ceremony for Paris was an LVMH show, basically. Yeah, it was interesting. We saw a lot of good branding for them. And yeah, NBC Universal, which is owned by Comcast, which is also sponsoring the squash court. They entered into a new three billion dollar partnership with the IOC. So you're seeing all these things mixed together. And yeah, it makes sense that this is a pilot for now, but might become a bigger thing. I did not know that FIFA does it, though. So when you watch a game at the World Cup at New Jersey's MetLife Stadium, it's going to be known as the New York, New Jersey Stadium.

14:20Really rolls off the tongue right there. All right. Up next, we have Stock of the Week, Dog of the Week. This message is a paid partnership with Apple Card. I'm a person who really appreciates simplicity. And when it comes to credit card rewards, the simpler, the better. That's one of the many reasons I have an Apple Card. The rewards are super straightforward. I earn up to 3 % daily cash back on my everyday purchases. There are no points to calculate, no limits or deadlines. Plus, it's super easy to access my card and make payments from the wallet app of my iPhone. If that sounds like the kind of simplicity you want in a credit card, apply for Apple Card in the wallet app on your iPhone.

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16:05It's Friday, blessed Friday, which means it's Stock of the Week, Dog of the Week time, the segment where Toby and I pick one stock that lives the life of a showgirl and another that gets stage fright. I won the pre-show contest, which was a free solo race up El Capitan, so I get to go first. And my Stock of the Week is the entire crypto industry whose powers are growing stronger than the Toon Squad in the second half of Space Jam. Here's what happened this week alone. Bitcoin hit an all-time high on Thursday at$124 ,500. It's up 27 % this year, well outpacing the S &P 500. Ether, the second largest crypto by market cap, gained 6 % to nearly a record high.

16:44It's up 40 % this year. And perhaps in the most bullish sign of all, a crypto company named Bullish went gangbusters in its IPO. On Wednesday, the Peter Thiel-backed exchange went public and proceeded to pop 84 % on its first day of trading thanks to frenzied demand by retail traders. Bullish is a symbol of crypto's fall from grace and recent rise from the ashes. Back in 2022, it tried to go public via a special-purpose acquisition company, but that deal collapsed when a number of crypto firms, including FTX, imploded. It hunkered down during what's commonly known as crypto winter. But out of crypto winter has come hot crypto summer.

17:21The Trump administration has taken a very pro-crypto regulatory stance. Companies are racing to add Bitcoin to their balance sheets. And overall, a risk-on attitude pervades the markets. Hope you held on to your Dogecoin, Toby. I did hold on to my Dogecoin, and that is not doing great. Thanks for bringing that up. But yeah, crypto has just scored multiple regulatory wins in 2025. I mean, it was just floated as well to allow crypto assets in 401k retirement accounts. So every news headline you've read about crypto over the past few months has been positive. I also want to dive into this other rise of Ethereum treasuries, Ether treasuries.

17:59Obviously, companies have been holding Bitcoin on their corporate balance sheets. It's become more popular. This is popularized by MicroStrategy that became Strategy. But now a lot of companies are doing it. And so now companies are doing the same thing with Ethereum. There was this company that used to be called 180 Life Sciences. It pivoted and now rebranded as it plans to rebrand as ETHZilla. And they're going to pursue an Ether treasury strategy. And that made the stock jump as much as 70 % on Wednesday. So we're seeing the exact same playbook that was run with Bitcoin now being run with Ethereum.

18:34So just to put a point on it, like what is happening here? Companies that are struggling with doing whatever that they were intended to do are instead pivoting. and they raise money to buy Bitcoin and now Ethereum. And their stocks shoot up like crazy because investors somehow value these companies at maybe twice the value of the crypto that they're holding. MicroStrategy did this and they have over a hundred billion dollar market cap. And now all of these other companies are doing it too. It shows just the overall ebullience of the market right now when it comes to crypto. My dog of the week is fast casual restaurant chains, or as I like to call them, bowl slop purveyors.

19:11The sad desk launch economy has taken a beating lately. Chipotle kicked things off by reporting a 4 % drop in same-store sales back in July. Sweetgreen followed, reporting a 7 % decline in its most recent quarter. And Kava capped things off this week, reporting a 2.1 % contraction, flipping from 10 % growth the previous quarter, cementing the narrative that traffic is softening across fast-casual restaurants. A softening job market and economic pressure has put strain on customers' finances. One TD Cowan analyst also pointed to the resumption of federal student loan payments as a reason for the reduced spend.

19:47That's a problem for bull slop companies because they rely on the 18 to 24-year-old eater. Cava and Sweetgreen both derive nearly 20 % of their business from that demographic. Meanwhile, customers are starting to swing back towards more value-oriented chains like McDonald's, who saw a 2.5 % bump in sales last quarter. It's a tough time to be a bull slop investor too. So far this year, Chipotle is down 30%. Cava is down 41%. And Sweetgreen is down 71%. Ouch. The Chipotle CEO is getting a little vindicated here because a few months ago, they were the first company to report earnings in this entire fast casual industry.

20:27And they reported 4 % decline in same store sales. And people were like, oh, is Chipotle cooked? And he said, believe me, we've unpacked this thing 10 ways to understand is this a self-inflicted problem or is this just a more macro problem now that sweet green wing stop kava have all reported horrible earnings think he's vindicated a little bit and saying that it is a macro problem affecting this entire industry i think what you pointed out of people having to repay their student loans is a big factor in the decline here such a big change from a year ago though i mean last year it was the year of bull slop.

21:01Chipotle and Cava were both reporting double-digit same-store sales growth, even as the broader restaurant industry was struggling with foot traffic. But then it seemed like, at the time, it seemed like fast food was getting so expensive that fast casual chains were saying, hey, we are very similar price points here with much better food. Just come to us. And a lot of consumers were accepting that logic. But then McDonald's went on this massive value push recently, rolling out a$5 value menu, rolling out a$2.99 snack wrap. Now there is a larger gulf between at least the perceptions of McDonald's once again and fast casual chains.

21:39That being said, sans McDank's fast food is struggling too. Same-store sales in the most recent quarter declined 3.6 % at Wendy's, 5 % at KFC, and 1 % at Popeye's. McDonald's is a bit of an outlier there. But just in general, it seems like people are pulling back from these chains. Do you think it is terminal decline or is it a blip on the radar? People will reverse course because I think that it is very cyclical with economic times where if people are pulling back, then they're not going to be spending on$15 salads. But if times are better than they will. So they already these companies are already saying that Q3 is looking a little bit better.

22:18So you have to bet on a turnaround. And maybe it's just the bull slop phenomenon that people are realizing it's just not that good to eat slop from a bowl because the only company doing well in the entire fast casual area is Potbelly. Put some respect on Potbelly's name. The sandwich chain same store sales rose 3.6 % last quarter. It's best performance in two years. I will never speak ill of bowl slop. I love, you know, going to the trough and just shoveling it in my mouth. All right, let's sprint to the finish with some final headlines. Hope you're not planning to travel to or within Canada this weekend because Air Canada is preparing to chop all flights come Saturday morning because of a looming flight attendant strike.

22:58The carrier, Canada's largest, began cutting flights yesterday and said it would suspend all flights by Saturday after the union representing its flight attendants voted to strike come 1 a.m. tomorrow morning. The union said that Air Canada's offer of a 38 percent raise was, quote, below inflation, below market value, below minimum wage and would leave flight attendants unpaid for some hours of work while the plane was on the ground. The tourism industry is bracing for catastrophic losses if the strike happens, since it would take place during the peak summer travel season. Air Canada warned that shutting down would affect 130 ,000 customers a day.

23:33Also, a really bad country for it to happen to because Canada is really, really big. It's not like you can just drive from one side to the other. So So that is going to dispute a massive amount of people's summer vacations. And then also Air Canada operates international travel from the company as well. And it's just horrible timing too because obviously it's peak travel season right now. But also they were seeing this huge revival in domestic travel because less Canadians were going to the United States. They were kind of boycotting the United States. We did see Canadians returning from the United States by air fell 25 % in July.

24:08So that is still a meaningful thing that is going on right now. And then you have the biggest domestic airline in the country shutting down. So just a bad country for it to happen to and a bad time for this to happen. And they're racing to see if they can work out a deal before it all goes down on 1 a.m. Saturday. Looks like we're not out of the inflation woods yet. A measure of wholesale prices rose much more than expected in July, showing that tariffs are indeed raising costs for companies that they'll likely pass on to consumers. The producer price index, which measures inflation at the wholesale level, jumped 3.3 % annually last month.

24:40the biggest increase since February, and it increased 0.9 % month over month compared to projections of just a 0.2 % gain. Remember, earlier this week, the market breathed a sigh of relief when inflation measured at the consumer level, the consumer price index, came in pretty tame. That was thought to cement a Fed rate cut at the next meeting in September. But this surprise wholesale inflation number was a reminder that tariff-fueled inflation is no doubt coursing its way through the economy. Yeah, PPI is thermometer for wholesale prices. It just measures how much companies are charging other businesses for their goods and services before those things ever reach you.