Biden-Blocked $15B Steel Merger Gets Messy & Indoor Golf Ready for Prime Time?

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0:27Good Morning Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, inflation claims another victim as Justin Trudeau steps down as Prime Minister of Canada. Then a new high-tech Tiger Woods-backed golf league kicks off its inaugural season tonight. It's Tuesday, January 7th. Let's ride.

0:50This might make you feel a little lazy. A 55-year-old Belgian woman named Hilda de Soen just put all of our New Year's resolutions to shame, saying she completed one marathon per day in 2024, a goal she set for herself at the beginning of the year. That's not only wildly impressive and a little bit crazy, but it also could be history. She's submitting evidence to the Guinness World Record to become the first woman to run a marathon every single day of the year. Toby, she said the hardest part about this wasn't the physical aspect, but the mental anguish of waking up and knowing you have to start all over again every day, which same.

1:31Same. The only thing more impressive than running a marathon every single day could be recording a business news podcast every morning. I think they're on similar levels. Also, it was a leap year last year, so she actually ran 366 marathons. Pretty crazy. How about this, though, too? She was working part-time. She also has four children and a husband, so it wasn't just running 24-7. She also lived life in between. Now, if you want to start running this year, if that's one of your goals, maybe you don't have the goal of running a marathon per day because who does? Her advice for people starting out is don't expect insane results right away.

2:09Just build it up gradually and you will see the benefits. Don't expect miracles in a short time. So consistency matters. Oh, Canada, you're going to have to find a new leader after embattled prime minister Justin Trudeau announced his resignation yesterday. Well, let me clarify. He said he would step down as leader of his Liberal Party, but will stay on as Prime Minister until the Liberals select a new leader to replace him ahead of elections later in the fall. Trudeau has been in power since 2015 for nine years, but recently he's become about as hated in Canada as the Boston Bruins, with his popularity dipping last month to just 19%.

2:46The faltering economy has a lot to do with it. Canada has a housing crisis on its hands that's even worse than the one we have here in the U.S., but without a booming economy to make up for the cost of living. Meanwhile, President-elect Donald Trump has threatened 25 % tariffs on all goods coming into the U.S. from Canada, which, even by Trudeau's own admission, would, quote, devastate their economy. It was the threat of tariffs that ultimately sealed the deal for Trudeau. Last month, his finance minister and close ally, Chrystia Freeland, resigned from her position, citing disagreements with Trudeau over how to respond to Trump's plan.

3:21After that blow, Trudeau had lost his party and there was no going back. Trudeau is kind of emblematic of a lot of the things that progressive politics around the world are suffering right now. They're suffering a lot of voter backlash. You look at the economic stagnation coming out of Europe. It does mirror what's happening in Canada as well. Canada's economy got really wonky. Inflation peaked at 8 % back in 2022. It hasn't dipped below that 2 % until last summer. Then Trudeau tried to jumpstart the economy by increasing immigration, which likely led to these rising housing costs, like you mentioned, and also spurred a lot of voter backlash as well.

3:59Unemployment is still at a near record high at 7 % in November. Also, the number of Canadians visiting food banks, that hit a record last spring. So everywhere you look, there's a lot of disconnect in this voter body. So there was the writing was on the wall and the last name on the coffin was his own, you know, economic minister turning against him. Yeah, let's focus in on those that housing crisis and those housing costs, because we think we have it bad here. But if you go just north of the border, truly, it is so hard to afford a home. Housing prices soared over three hundred and fifty five percent between 2000 and 2021.

4:34That's more than quadrupling. And a lot of focus has been on Trudeau's big push for immigration. And Canada grew the most in 66 years in 2023, welcoming 1.5 million new permanent residents. There's a big debate going on about whether that contributed to a lack of housing supply. But either way, there is a big lack of housing supply. People can't afford homes there. There's also been a major shrinking in household and the number of people in a household. So in 1961, the average Canadian household had four people. By 2021, that figure had dropped to just 2.4 percent. So when you have smaller households, you just have more people that need to find housing.

5:17If there's a supply crunch, that will add to price pressures. And then we have to talk about its relationship with the U.S., Canada's relationship with the U.S., its over-reliance on the U.S. for its economy. 97 percent of its petroleum exports go to the United States. 80 percent of total exports go to the United States. It's very much reliant on that cross-border trade, hundreds of billions of dollars, go across the border every year. And then when you have Trump coming in and saying, oh, I'm going to put a 25 percent tax on all of those imports, that could easily drive Canada into a recession.

5:51And then what is Trudeau's loss and the Liberal Party's loss is the Conservative Party's gains. If an election were to be held right now, right now the Conservative Party led by Pierre Poldiver is up in the polls by double digits right now. So it does look like there is the tides are changing in Canada, just like they are, just like populist right wing parties have made strides across the European Union and really all across the world. So it does look like there will be a change in the rule of Canada going forward. Nipod Steel's planned acquisition of U.S. Steel is like a desperate football team down by a touchdown on their own one yard line with 15 seconds to go.

6:28But by golly, they're going to try to lateral their way to the end zone. The two companies filed two last-ditch lawsuits yesterday to salvage their$15 billion deal, which President Biden had blocked over national security concerns on Friday. One lawsuit targets the U.S. government for allegedly running a politically motivated and corrupt process that ultimately led to Biden vetoing the purchase. The other accuses rival U.S. steelmaker Cleveland Cliffs, its CEO, and the steelmaker union boss of illegally attempting to scuttle the deal. Here's the SparkNotes version of how we got here. Last year, Japan's Nippon Steel, the fourth largest steelmaker in the world, agreed to buy U.S.

7:06Steel, a fading American giant. The proposal raised hackles among American politicians who had concerns about a foreign owner buying a company key to America's national security infrastructure. No matter that, Japan is a close ally of the United States. On Friday, Biden blocked the deal, saying his action ensured American companies continue to play a central role in sectors that are critical to our national security. That set off shockwaves across the Pacific where Japanese leaders said the veto would endanger future investment by Japanese companies in the U.S. Still, the merger isn't toast just yet and now moves to the courts for what could be some lengthy legal wrangling.

7:45Yeah, these legal actions are definitely a long shot. I mean, you called it a Hail Mary here because they are saying that this deal was heavily influenced by election year politics. Still, we're calling this a Hail Mary because presidents do have the authority to determine what constitutes a national security threat. And no transaction that has been blocked by a president citing national security concerns have been overturned by the court. So we are stepping into unprecedented territory. One thing going in Nippon's favor, though, is that usually for the vast majority of these rulings, it involved China, an adversary of the U.S.

8:23or a friendess area of the U.S. They usually involve companies tied to China. This one is tied to a U.S. ally in Japan. So potentially there is something, some wiggle room here, especially as you kind of exit out of this election year political cycle and can look at it with a more fresh and clearer look, not tainted by trying to win an election. Yeah, this was about as controversial as congestion pricing, honestly, because you had a lot of economists and free market folks who say we're looking at U.S. steel and are looking at essentially a failing company. They were going to have to cut jobs. They say they're going to have to move their headquarters out of Pittsburgh, which is, you know, their ancestral home, moving it to the south, close some meals, some mills in Pennsylvania.

9:08Then you have essentially a white knight in Nippon Steel coming and saying, we're going to invest$3 billion in you. We're going to keep your headquarters in Pittsburgh. We're going to invest in you and you are, you know, on your last legs here. So it seems like it would be a nice rescue package. And then you have politicians from Pennsylvania, Ohio, Biden, Trump as well, saying that they were opposed to the deal because steel is so key and they want American people. You know, they want an American company to own steel production in the United States. Steelmakers Union boss also came out against a deal saying that Nippon Steel did not do enough to assuage concerns that jobs would be jobs would be lost in the process.

9:53So this was a, you know, a big debate where I think most economists actually all economists came out on on the side of the deal, because without this deal, it's very unclear what U.S. Steel does going forward. It's possible that they'll just look for another buyer. Maybe Cleveland Cliffs come in. And then one thing, too, is that it's not just Biden who's opposing this deal. It's also president-elect Donald Trump. He opposed it last year in the election cycle, but he also has pledged to impose those hefty tariffs on imported goods. So yesterday he posted on True Social. Why would they, meaning U.S.

10:24Steel, want to sell U.S. Steel now when tariffs will make it a much more profitable and viable company, with the idea being that if you impose these tariffs, it will make U.S. Steel more competitive on the global market. So it looks like the deal isn't going to be revived anytime soon despite this last-minute legal action. As cold winter air descends upon much of America, golfers everywhere are heading indoors to get their swings in on golf simulators. Some of the best players in the world are doing the same. Players like Rory McIlroy and Tiger Woods will be teeing it up tonight for the first match of the TGL, a new simulator golf league looking to reimagine golf as we know it.

11:05Gone are wide fairways and a cool breeze on your face. In their place is a 250 ,000 square foot indoor venue, an IMAX size screen 24 times larger than your typical golf simulator, and a real grass and rough to hit off of. An all-star roster of investors, including Derek Jeter, Jimmy Fallon, the Williams sisters, and Tiger Woods are betting that packaging golf in a different format, with an emphasis on hot mics, a fast-moving team format, and some eye-popping tech, will draw new viewers to the sport. Neil, I see the vision. Simulator Golf is becoming a more popular entry point into the game for a lot of non-golfers because it's less intimidating and more accessible.

11:45But can this beefed-up version capture an audience once the novelty wears off? We'll see. That is the big question. They are not short on star power. Steve Cohen is an investor. You mentioned all of those celebrities as well. They got the 24 of the top golfers in the world. They built this incredible facility that mimics maybe a Squid Games type battle arena in Florida near Palm Beach. So they are trying to make a really fast paced, tech infused, made for TV product to bring golf to the masses and make sure, you know, I think their audience is twofold. It's golf obsessed people like you and me.

12:25And it's also the casual viewer who doesn't want to plop down on their couch for a full Sunday and have to figure out what's going on on this wide open course. There's a lot of tracking that is involved. It takes forever, admittedly. But if you show up in this very, you know, whiz-bang facility that has a lot of TV studio qualities and you have some personalities at the fore with these golfers, it could be interesting. I think the question is, I think a lot of people will watch in the first couple, I guess, episodes or matches. But will this have sustainability? And I think yes. Yeah, I mean, we're definitely going to be more bullish than the average person, I would say.

13:06But these matches are trying to be more of a party environment. They're going to have an emcee. There's going to be a DJ there. They're trying to create that party atmosphere that you've seen at some of these golf tournaments like the Waste Management in Phoenix, Arizona. players will emerge from the tunnel like wrestlers part of the design was inspired by WWE but I also think that the tech is playing a big part in drawing viewers into this I mean these the green itself is this big 41 yard wide turntable with 567 hydraulic actuators underneath that can change the brakes change the contours of the green so when you hit a ball onto the green on the simulator.

13:47You can then walk over to the green and putt based off of what the, you know, breaks are on that green. So a lot of very cool, you can call them gimmicks if you want, but I think the tech will hopefully draw people in, but then maybe the product will keep people tuning in every week. Yeah, I guess it just depends on how good the product is. One of the cool aspects of this that I do have to mention is these virtual holes. So when you play on a simulator, you have the ability to create digital renderings of golf holes that would never exist in real life, that you would never be able to create on a natural landscape.

14:19So if you go online and type in TGL virtual holes, you'll see some very oddly shaped holes that you would never see in real life. And that could lend a little creative flair to this. But Toby, do you think we'll be watching next season? I mean, it airs at 9 p.m. on Tuesday. So for us, maybe our bedtime is holding that against us. But yes. Do you think people will be watching? Hopefully, yes. Up next, it's Toby's Trends time.

15:13credit for the next one. Get started today at linkedin.com slash campaign. Terms and conditions apply. Tuesday on NBC, Jimmy Fallon and Bozema 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. May the best idea win! On Brand with Jimmy Fallon. Series premiere Tuesday on NBC.

15:53When did making plans get this complicated? It's time to streamline with WhatsApp, the secure messaging app that brings the whole group together. Use polls to settle dinner plans. Send event invites and pin messages so no one forgets Mom's 60th. And never miss a meme or milestone. all protected with end-to-end encryption. It's time for WhatsApp. Message privately with everyone. Learn more at whatsapp.com. If you nodded off during history class in high school, not only did you miss out on learning how the Mesopotamians were the first civilization to develop the concept of zero, but you also might have missed out on a lucrative career.

16:33The history business is booming, and I want to talk about it on today's edition of Toby's Trends. Leading the charge are podcasts. The Rest is History snags 12.5 million downloads monthly, outperforming This American Life by over a million downloads a week. As millions tune in to hear two middle-aged British historians talk about the Visigoths, among other things, history book sales in the UK and Ireland also hit record highs in 2023, with sales of ancient history books in particular rising 67 % in the last decade. In the U.S., the overall book market has been pretty much flat, but the history category has bucked that trend, growing 6 % in the past year alone, according to Circana.

17:14Toss in a TikTok trend from last year about how much we're all thinking about the Roman Empire, and everywhere you look, people are looking backwards. A few things could be contributing to the resurgence in historical interests. Our current era of rapid technological change could cause people to look backwards more fondly. plus declining enrollment in academic history could be pushing people towards more accessible mediums like podcasts and YouTube which begs the question Neil should we ride this wave and start a history pod I think so I mean everywhere every person I talk to is listening to a random history podcast the people the people I was with last night I asked them about the rest is history and they were like yeah I listen it's such a great medium for learning things and even myself before I found out about this trend was a thing.

17:59I was doing like a bike workout and I said, okay, what podcast should I listen to? I listened to Morning Brew Daily, all the episodes. So I was like, okay, I'll just put on a podcast, a history podcast and learn about maybe the American revolution and brush up on that. So I can understand why, you know, podcasts and the audio medium has lent itself to a rediscovering of history. And I think you have to go back to one particular podcast, one guy who really set off this boom, and that's Dan Carlin and Hardcore History. He started Hardcore History in 2006 with 16-minute episodes, and he's been doing these ever since.

18:35Now they've ballooned to over five hours, and they touch on some truly random subjects. I mean, one thing that I may have queued up or not, it's about eight years of the episode description. Pagan Viking sea kings spend the 10th and 11th centuries morphing into Christian monarchs, but with rulers like Harold the Bluetooth and Svein Forkbeard, it's debatable whether things will be any less horrific for Scandinavia's neighbors. How do you not listen to that? I mean, that was five hour podcast. He only releases about two episodes a year, but he has this, you know, extremely fanatical audience. And I do think what you're seeing too is that the population is aging right now.

19:14We've talked a lot about how birth rates are kind of falling. And just as a whole, people are getting older. And when you start to realize that once you have more history in your life, you probably are more interested in it. There is like the joke that every, you know, dad eventually becomes interested in World War II because you just become more interested in history as you grow up. And then also looking back through history, any period of profound technological or social change has been accompanied by kind of this mania for looking backwards in the past when the Victorians were kind of entering the industrial revolution they all became obsessed with dinosaurs ancient Egypt and classical civilization and then in the period after World War II look at what the Hollywood biggest movies in Hollywood were they were War and Peace, Ben Hurd, the Ten Commandments, Spartacus, Cleopatra all these backwards facing historical kind of blockbusters so I do think now as we're in the age of AI you are seeing just this renewed interest in history because as things change, the more you want things to stay the same and the more you look back into the past.

20:15Let's sprint to the finish with some final headlines. You know, when you have a pesky problem that just won't go away, here's what you need to do. Just throw a lot of money at it. At least that's what Disney did yesterday. It said it would combine its Hulu Plus live TV service with Fubo, a thorn in its side, to create the second largest online pay TV provider behind YouTube TV with more than 6 million subscribers. An important distinction, this isn't Hulu, the streaming service you watch only murders in the building on, but Hulu Live TV Plus, which is a streaming service that mimics the traditional cable TV bundle.

20:50So what was so annoying to Disney about Fubo? Well, Fubo sued it, Warner Brothers and Fox ahead of the launch of Venue, the company's sports-focused streaming service, and a judge agreed to block it. So Disney just went out and bought Fubo and provided an additional cash payment that resolves the litigation and allows the venue to proceed. Do you, was that English? That was English. I mean, it is just emblematic of our current streaming landscape right now. It's like Fubo, Teehee, Boo Boo, da da. That's what it sounds like. But they are, you are seeing this era of re-bundling happen right now.

21:24It's definitely a little awkward right now because this deal is closing over the next two years, but you'll still have to access Hulu plus live TV from the Hulu app and then Fubo through the Fubo TV app. So it's not ideal. These are two separate apps still. So even though they're a combined entity, you still will have to, you know, access them via separate platforms. So one person who's extremely happy though, are Fubo stockholders. Fubo stock more than tripled on the announcement. So clearly this bundling that we're seeing in the cable industry is going to lead to some, you know, winners here, one of them being Fubo, as they try to take on the big behemoth, which is YouTube TV with 8 million subscribers.

22:05Mark Zuckerberg has long been a fan of combat sports, and now he's mixing business with pleasure. Zuck appointed Dana White, the CEO of the UFC, to Meta's board yesterday, praising his entrepreneurial skills to go alongside new additions John Elkan and Charlie Songhurst. White is also very good friends with Donald Trump, whose inauguration is just two weeks away. So it looks like this move is also part of Meta's strategy to strengthen ties with the incoming administration. Neil, Meta certainly has one of the more physically imposing boards now when it comes to Big Bang. You'd have to think. I mean, I wonder if Zuck is just doing this to get better UFC tickets.

22:43I think probably he's pretty obsessed. But you're right. This is emblematic of Zuck's turn toward Trump in recent weeks. He just appointed Joel Kaplan, who has deep GOP ties as the new policy chief. They booted the previous guy. Zuck donated a million dollars to Trump's inauguration fund, along with a bunch of other tech companies. And then now, with the addition of Dana White, who's a big Trump ally, I think that completes the trifecta of ways to get him in with the new administration. And as Meta has pivoted a little bit from classic social media to the metaverse, AI, wearables, things like that.

23:21It's had a completely revamp of the board. All but two of Meta's current directors have joined since 2019 and just got three more yesterday. Finally, NVIDIA CEO Jensen Huang donned his leather jacket and kicked off the biggest tech conference in the world, CES, yesterday with a keynote outlining NVIDIA's ambitions over the coming years. Part of that vision is Project Digits, a personal AI supercomputer powered by one of its next-gen Blackwell chips that can sit on your desk. Huang also introduced a platform called Cosmos that creates photorealistic videos that can then be used to train physical AI systems like robots or autonomous vehicles at a fraction of the cost of gathering conventional real world data.

24:05Neil, this was a buzzy keynote to say the least. Yeah, and it shows how NVIDIA is moving beyond its classic bread and butter, which is providing chips for training data for large language models like ChatGPT and is moving more into the physical world. That was really the crux of this keynote was that NVIDIA wants to become the software provider for robots, cars, automating warehouses, things that we actually interact with. And he said the ChatGPT moment for general robotics is just around the corner. So he was flanked by a bunch of robots on stage. So if you, you know, as maybe we've seen in the large language model space, when you Google some, when you search something on your computer, that could be moving more into the physical world where we interact with humanoid robots every day.

24:52Yeah, I think the big unlock here is that usually to train robots or autonomous vehicles, you have to literally drive them in the world or pilot them around the real world. But if you can mimic the real world with these very realistic simulations, essentially, it drastically reduces the training costs and the training time because now you can drive it through a virtual world instead of the real world. So I think Cosmos is the big unlock when it comes to robotics. Meanwhile, investors were hyped about this. NVIDIA gained more than 3 % ahead of the keynote to close at a record high. It's now worth$3.66 trillion.

25:27$4 trillion is in sight. Let's wrap it up there. Thanks for starting your morning with us and have a wonderful Tuesday. For any questions, comments, or feedback, send an email to morningbrewdaily at morningbrew.com. And don't forget to share MBD with friends and family who would enjoy it. It's as easy as sending a blast in a group text or stealing someone's phone from them and subscribing them to the feed. Your choice. If you don't know who exactly to share it with today, here's Toby with an idea. I want you to share the podcast with someone who might be a little under the weather right now. Maybe a hearty dose of MBD is just what they need.