Congress Wants to Ban Prediction Markets & Clear Scores from TSA Chaos

0:00Neal Freyman:Managing media plans for multiple clients can feel like herding cats. Disney Campaign Manager is built for fast-moving agencies looking for one simple ad-buying solution to handle all of their streaming TV campaigns across Disney +, Hulu, and ESPN. Set flexible budgets, adjust on the fly, and optimize for total campaign control across every buy all in one platform. Get started today at DisneyCampaignManager.com. That's DisneyCampaignManager.com. Good morning Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, the airport chaos has been horrible for everyone except this one company. Then why is the U.S.

0:41Neal Freyman:banning foreign-made Wi-Fi routers? It's Friday, March 27th. Let's ride.

0:51Good morning and happy Friday. Toby successfully made it through airport security yesterday and is coming to us live from Florida, which is sad because I won't be able to watch the college basketball games with you this weekend. Last night's men's Sweet 16 games had a couple of epic finishes, and tonight should also be fascinating. In one of the matchups, St. John's is playing Duke, and here's a wild stat about that game. The Duke men have won five national championships, and in every one of those seasons, they've defeated St. John's on their way to the title. So if Duke wins tonight, it does bode well for the Blue Devils.

1:26Toby, what's the latest on the MBD bracket?

1:28Neal Freyman:Yeah, in our March Madness pool, our leader is still the guy with the name, the real Neil Fryman, which is maybe it is you at this point, Neil. I don't know. He might go wire to wire at this point. My own bracket has its way up to 28th place. Thank you, Illinois. My women's bracket, though, has plummeted. Unfortunately, that MBD pool is still being laid is being led by Payne's picks. So shout out Payne. but we all pale in comparison to eighth grader Otto Schellenhammer. He is 14 years old and he still has a perfect women's bracket. He has started out 48 and 0 and has Texas winning it all, which I do as well.

2:09Neal Freyman:So I'm, I hope I'm not a jinx still. The AP pointed out that Schellenheimer has a long way to go. The best start in the ESPN women's competition ever is 57 correct picks in a row, which actually happened last year. So good luck to Otto. Good luck to the real Neil Fryman and Payne's picks. And you know what? Good luck to me too. And now a word from our sponsor, LinkedIn Ads. Toby, do you ever think you've seen a billion of something all at once? Yes, I have taken a lot of selfies. I think you're severely underestimating how much is in a billion. For example, LinkedIn Ads has a network of over 1 billion professionals and 130 million decision makers.

2:48That is a lot.

2:48Neal Freyman:You can target your buyers by job title, industry, company role, seniority skills, company revenue, so you can stop wasting budget on the wrong audience. Plus, LinkedIn ads generates the highest B2B, that's business-to-business, ROAS of all online ad networks. Spend$250 on your first campaign on LinkedIn ads and get a free$250 credit for the next one. Just go to LinkedIn.com slash MBD. That's LinkedIn.com slash MBD. Terms and conditions may apply. If you are so over hearing your unemployed friend talk about prediction markets, Congress is with you. Multiple bills are filtering out of the Senate and the House proposing different methods of cracking down on an industry that many think is more akin to gambling than events-based contract trading.

3:32Neal Freyman:A new bill called the Stop Corrupt Bets Act would ban contracts on elections, sports, government actions, and military moves. That comes on the heels of a bipartisan bill coming out of the Senate on Monday that would ban any prediction contract that resembles a sports bet or casino-style game. And it goes along with the PREDICT Act from the House that seeks to explicitly ban members of Congress, the president, and high-ranking officials from trading in certain prediction markets. Now, it's not often that you have bipartisan support for anything these days, but after suspicious activity around the Maduro raids and Iranian war, Congress is mobilizing.

4:10Neal Freyman:The platforms themselves are obviously against these measures, and Calci has pushed back, saying in a statement that prediction markets offer a fairer choice to consumers than sportsbooks, adding that we should let competition run its course instead of protecting monopolies. The bills themselves will face an uphill climb, even if they make it to the president's desk. President Trump's appointed CFTC chairman has shown support so far for the industry, while Donald Trump Jr. is a strategic advisor to both Calci and Polymarket. Neil, there are a lot of ways you can attack this industry right now, from insider trading allegations to the fact that many see them as unlicensed sportsbooks operating under a legal loophole.

4:49Neal Freyman:Feels like there's a concerted push right now to rein them in. Yeah, the heat is totally being cranked up. There are multiple layers to this backlash. Shrek would be very proud. On the one hand, you have states saying, hey, you're offering what is essentially sports betting in our state, but we haven't legalized sports betting. You can't do that. 19 states still haven't allowed sports betting since that big Supreme Court decision in 2018. But you can use Kalshi to wager on sports there and also Polymarket. And then increasingly, you have this tsunami of federal bills. Three this week alone, three were released, which basically are argue prediction markets are destroying democracy in the fabric of our society by being rife with insider trading and allowing americans to wager on literally anything that ever happens which is ruining their lives so the heat is being turned up i think the two vectors of attack as i kind of called them were states getting mad about sports books but then also people getting mad that maybe insiders within congress or insiders within the government apparatus are trading off of information that is not materially available to other people.

5:51Neal Freyman:Let's go back to the loophole that people are describing that allows them to offer contracts based on sports. Sportsbooks are regulated by the states. Prediction markets are monitored federally by the Commodity Futures Trading Commission, the CFTC, because technically what is happening is an events-based swap, not a bet. Again, that is a legal difference. It's essentially the same exact process, which is why sports books are mad. And sports is where all the money is on these platforms. No matter what Calci or Polymarket say about what they offer, like you can trade on anything. Most people are trading on sports.

6:30Neal Freyman:Calci reported that 90 % of its trading volume during the 2025 NFL season was on sports. Sports was the most traded category on Polymarket all of last year. If you just look at March Madness alone, They have seen their volume spike to over$2.67 billion on Calci alone. It is definitely a platform that is being used primarily to bet on sports, which is why sportsbooks in states are mad. Right. So there's this turf war that's going on between the states and the federal government. But there's also this more moral backlash to gambling more broadly, which is not just focused on Polymarket and Calci, but also DraftKings, FanDuel, and our culture of just literally gambling on everything.

7:11Recently, Major League Baseball signed a deal with Polymarket, and Alexandria Ocasio-Cortez, the representative from New York, had this tweet that went absolutely viral, quote posting this particular deal between MLB and Polymarket, saying, Pervasive gambling is not good for society. It turns life into a casino, traps people in addiction and debt, surges domestic violence and fosters manipulation. And what was interesting about that particular post is that a bunch of conservative people also said, I don't agree with AOC on literally anything, but I agree with her here. So there does seem to be a groundswell of support to reining these companies in, not just the prediction markets, but also DraftKings and FanDuel and this culture that America has developed in recent years of gambling on sports and everything else.

7:58Neal Freyman:I have one more anecdote that just speaks to exactly what you talked about. What are sports books up to these days? DraftKings just introduced a way to gamble on hundreds of pitches for outcomes from old MLB games. So literally you open the app. It's called DK Replay. It looks like an arcade game and you have 15 seconds to bet on a simulated pitch being a ball or a strike or in play. There's no game that you're watching. They've just stripped away any, you know, pretenses of actually enjoying the sport. Now you just see an animated pitcher in an animated strike zone, and you have to guess what the ball is going to do based on an old pitcher versus batter matchup.

8:36Neal Freyman:So it's literally exactly what you're talking about. It is the financialization, the gambling epidemic, if you want to call it that, is just absolutely encapsulated by the fact that we're betting on old baseball games at this point. So we're seeing prediction markets get more in the hot seat, but who knows whether anything will happen. And as you said earlier, it's going to be an uphill climb because they still enjoy support from the top echelons of the Trump administration. Miami is the new San Francisco. That is the conclusion drawn by economist Jed Kolko after new census data released yesterday showed people are leaving Vice City like it was SF during COVID.

9:11In the year through last June, 114 ,000 people left the Miami area for other parts of the country, the highest out migration rate of all large American metros. But Miami isn't alone. a number of the largest U.S. metropolitan areas are shrinking, the census revealed, largely the result of the Trump administration's immigration crackdown. New immigrants often come to large cities where there are existing networks and plentiful jobs. Without that influx, these urban areas are having trouble holding on to their populations, which sustain their economies. Los Angeles is another city that's losing people.

9:43Last year through June, the L.A. region gained 38 ,500 people in net immigration, but lost a whole lot more, 131 ,000 to other American cities. San Diego County's population also fell by about 5 ,300 people, and New York City shrank for the first time in three years. This is the most comprehensive view so far on how the immigration curbs are impacting the country's demographics. From a previous census release, we already knew that the U.S. population in total grew by a measly 0.5%. The data out yesterday drilled down into the county and metro level to reveal which areas were gaining people and which are shrinking.

10:19And most are shrinking.

10:20Neal Freyman:Are you sure about that, Neil? Only 83 of the nation's 387 metro areas shrank. That is up from 52 the prior year. In about 75 % of all counties, overall population growth either slowed or turned negative. That means only 25, a quarter of the counties in the United States are growing. four in 10 U.S. counties shrank last year. So you are absolutely right. The great shrinkage is upon us right now. And it's not just affecting big metro areas too. The piece called out too that immigration is leaving a mark on smaller metro areas, of course, along the southern border. So it really is counties big and small.

11:00Neal Freyman:We will dive into the only places that are growing, which I think many can assume are in the south. But right now, a lot of the big population centers are absolutely shrinking. Okay, so let's go to that good segue, Toby. I set you up, I set you up. You set me up. Where is growing in the United States? Which populations, which areas are seeing more people? And that is mostly in the South among counties with populations of at least 20 ,000 people. Nine of the 10 fastest growing were in the South, I guess not Miami, which you can say, you can debate whether that's the South or not. But the cities that are growing at four times the national rate or more are places like Austin, Texas, Raleigh, North Carolina, Ocala, Florida, Myrtle Beach, Wilmington, North Carolina, and then others that really aren't in the South, but are more in the Mountain West, Boise, Idaho, and St.

11:47George, Utah. So they're bucking the trend. But overall, these curbs on immigration are really denting the population growth. And even for most large cities, they're sending their populations downward.

11:58Neal Freyman:And how do you grow a population? There's really only three ways. One, there is domestic migration, which is when you move from, you know, I moved from New York to LA. There's international migration where you move from another country into the United States, or you can have more births than deaths. We have talked a lot about how the birth rate is falling. That doesn't look to be reversing at any time soon. So you can't necessarily rely on growth from that leg of the stool. Then you have less people kind of moving into these big population centers in general, or they're just moving to, you know, a little bit smaller versions of large population centers like Austin, Texas.

12:34Neal Freyman:And then, of course, obviously policy impacts international immigration as well. So that is a very wobbly three legged stool, which I actually don't even think is physically possible. Even if legs are different sizes, it's not wobbly. But in this metaphor, you are looking at a very wobbly stool. Right. Well, here's the thing. The United States has always had this immigration cushion. We've talked a lot about demographic crisis facing places in East Asia, like South Korea, where deaths are outnumbering bursar or not having enough babies to replace their population. But they don't have the immigration that the United States has always had.

13:07People have always flocked to the United States from other countries. And now it looks like that is drying up and we're relying more on people having more babies as opposed to dying. And that is not doing well in the United States. So it's something that demographers are going to be watching closely. Welcome to Stock of the Week, Dog of the Week, the segment where Toby and I pick one stock that's blooming like a cherry blossom and another that's wilting like an uncared for houseplant. I won the pre-show hopscotch competition, so I get to go first. And my Stock of the Week is Clear because when chaos reigns at airports, Clear is the beneficiary.

13:40Shares in the company have jumped more than 60 % over the last month and are up 13 % this week alone as more travelers buy memberships to avoid dystopian security lines at TSA checkpoints. For more than 40 days now, the Department of Homeland Security has not been funded, leaving TSA agents to call out of work because they're not being paid. This airport mayhem has been a huge windfall for Clear's aviation business, which whisks travelers through security using biometric scans, a service it offers for more than$200 per year. Since the beginning of March, passengers have downloaded the Clear app 289 ,000 times, triple the number from a year ago, according to the Wall Street Journal.

14:15Not a few of them are signing up for Clear on the spot in the terminal, anxious that they'll miss their flight if they continue to languish in the standard line. While Clear's airport service still brings in most of the company's revenue, investors are also excited by Clear's expansion into new areas, like its ID verification platform for businesses that brought in record bookings last quarter. It's also making a big push into healthcare, striking a couple of deals with health companies to streamline patient check-ins. Toby, Clear's pitch is indeed crystal clear, pay us and you'll wait less. And it's pretty compelling in this age of long lines everywhere.

14:44Neal Freyman:I really do think that the reason why we saw the stock to the jump that it did this week. It's not because very long lines were appearing at airports. That definitely exemplifies the story that we're trying to tell, but it really was this expansion beyond airport security that got investors so excited. I mean, integrating with Epic, one of the country's biggest medical record platform, I didn't even know they had a healthcare business to begin with. They signed a contract with the Centers for Medicare and Medicaid services. So I do think that the diversification story beyond just long airport lines and people, jumping out of line to go sign up on the spot is why we saw the stock do what it did.

15:22Yeah. And they're not the only company that's doing well during these chaotic times at airports. Rental car companies are absolutely crushing it right now. Hertz stock rose 8.6 percent on Thursday. Avis had its biggest one day gain since June up 17 percent. So people are turning to rental cars instead of wanting to wait in line at these airports. It looks like I do have some good news. It looks like this national nightmare might be coming to an end in perhaps this clear stock rally as well. Overnight, Senate Republicans, Democrats agreed to fund most of Department of the Department of Homeland Security, including TSA.

15:57They're leaving out immigration currently, but they are. The Senate did pass a bill to fund DHS, including TSA, because right now, TSA agents today are going to miss their second full paycheck. Earlier this week, TSA director came on and said, these are the longest wait times in history. So you're not imagining it. These are the longest wait times in history. 480 agents have already left this particular workforce to look for other jobs. So it looks like the House will take this up today and hopefully President Trump will sign this soon so airports can turn back to normal or whatever normal was before this.

16:30Neal Freyman:I made my flight and I didn't even have to chat and cut to do it. So that's the good news too. So, all right, we're going to take a quick break and come back with our dog of the week right after this. This episode is brought to you by Apple. There is nothing like your first Mac. When I got mine, I was heading into freshman year at the University of Maryland. A lot was uncertain that fall, but I knew I had a dependable sidekick for homework, connecting with other students and devouring blogs about our basketball recruiting class. What about you, Toby? For me, it was right as my sister started to get recruited to play soccer in college, I was given the very important task of making her a highlight tape, and iMovie was my best friend.

17:09Neal Freyman:She ended up playing at Georgetown, so I'd say it was all worth it. That's how we felt with our first Macs. How will you? Check out the all-new MacBook Neo, an amazing Mac and a surprising price. Find out more at apple.com slash Mac. That's apple.com slash Mac. Neil, think fast. About what? Order fulfillment. ShipStation's intelligence-driven platform brings order management, rate shopping, inventory and returns, warehouse systems, and comprehensive analytics all in one place, saving customers 15 hours per week on fulfillment. With ShipStation, you can connect to over 200 sales channels. Instead of five to seven disconnected tools, you've got one.

17:50Neal Freyman:Try ShipStation free for 60 days with full access to all features, no credit card needed. Go to ShipStation.com and use code MBDS. That's ShipStation.com, code MBDS. Toby, how do you wake up in the morning? Well, I asked our producer to slap me across the face as hard as they can or drink coffee. Have you considered ultra pouches? They're completely nicotine-free and caffeine-free, but help you feel human in the morning with clinically proven nootropics and adaptogens to deliver immediate focus and smooth energy that lasts one to two hours. In fact, 90 % of users saw significant improvements in their overall focus levels with zero cheek pain.

18:32Neal Freyman:Way better than my slap method. Get some for yourself at TakeUltra.com. That's TakeUltra.com. My dog of the week is your Wi-Fi router because it's going to be really hard to get a new one if your roommate accidentally mistakes it for the toilet after a night out, speaking from experience there. This week, the FCC ordered a ban on the import of any new models of foreign-produced wireless routers, calling them an unacceptable risk to the national security of the United States. Now, you don't need to go ripping out any cords. If you have a foreign-made router right now, you can keep using it, but it's going to make shopping for a new non-urin-filled router a major headache since the ban is in place regardless of the nationality of the parent company.

19:16Neal Freyman:Even if you're buying from a U.S. company like Cisco, if the routers are made outside the U.S., banned. The idea behind such a wide-sweeping crackdown is that the same piece of hardware that brings you an episode of Love is Blind is also a perfect vector for cybercriminals. Recent attacks on American communications, energy, water, and transportation infrastructure all involve routers produced abroad. But Uncle Sam slamming the door on foreign routers is going to seriously disrupt a market that doesn't have the domestic producers to pick up the slack. TP Link, Amazon, Google, and others all build their routers overseas and will need time to set up or expand their manufacturing presences in the U.S.

19:55Neal Freyman:Neil, this is pretty on brand for the U.S. Smartphones and drones from Chinese companies have been greeted with similar restrictions. But routers are a different story because of how ubiquitous they are and how few domestic options are available. All right. That is some Toby lore that I'm not sure we needed to hear. But yes, it's been a total freak out because it's like detonating a nuke on the consumer market. Basically, no routers that anyone buys, that you buy, that I buy, that anyone has in their homes are made in the United States. And I think the point to emphasize here is that it can be made by an American company like Cisco or Starlink.

20:28But if it's made abroad, you know, the future versions won't be available to buy on the consumer market. And I think that's another point to emphasize. The one you have now is perfectly fine. You don't have to switch it out. And if a product is currently available in the United States, it's also fine. It's basically targeting any future device that is made abroad. And the way they're justifying this, the United States government issued this document saying that routers have been targeted in previous hacks. They name a couple of them. Salt Typhoon and Flax Typhoon are a few in the past few years where China backed espionage groups hacked into routers and other telecom systems.

21:05And at least in the Flax Typhoon one, they said that 126 ,000 devices in the United States, including thousands more around the world, were infiltrated by these China backed groups.

21:14Neal Freyman:The question is, are U.S. made routers safer? And the answer is not inherently because a router's vulnerability to attacks doesn't really depend on where the exact components are manufactured. It really depends more on its cybersecurity protocols. So just having a Made in USA sticker on a router doesn't inherently make it safer for national security concerns. That is one thing that a lot of industry watchers were pointing out. If you're looking for some bright spots in this Dog of the Week segment, Netgear stock actually rose this week because it is a U.S. company, and some of its routers are made outside of China.

21:51Neal Freyman:So investors are saying, hey, maybe that is going to give it a competitive edge in this new router landscape. And then you mentioned Starlink. Starlink does make some of their routers inside the U.S. They also make some in Vietnam. So Starlink could be a winner as well because some of its routers are actually assembled in Texas. Yeah, it's going to happen now. It looks like all these companies are going to file for exemptions because the United States government also will allow exemptions. We saw this with what happened with drones earlier. I think it was in December. They, the U.S. government did something very similar with foreign made drones.