DOGE Pitches $2T Budget Cuts & Everyone is Drinking Guinness

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. Good morning, Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, Doge comes to Washington as Elon Musk and Vivek Ramaswamy kick off their cost-cutting project.

0:41Ben, why Guinness is suddenly the hottest drink in America this holiday season? It's Friday, December 6th. Let's ride.

0:53One thing that we always appreciate about you is that whenever Toby and I mispronounce a word, you are quick to correct us. And this kind of reinforcement learning is working. I haven't said NVIDIA in over a year, just NVIDIA. But everyone struggles to say some words, especially if they're new. And the language learning platform Babbel just released its list of the most mispronounced words of 2024 in the U.S. and the U.K. Toby, I know you've been practicing all week for this performance. So please impress our listeners by pronouncing the words that trip people up the most and explain what they are.

1:28Here is the top 10. First is Kamala, as in Kamala Harris. Then there's Kyogen, as in Barry Kyogen, as in the freaky guy from Saltburn, as in Sabrina Carpenter's now ex-boyfriend. Then there's Koi Kurhunche, which is a Dutch breed of dog that Shohei Otani owns. So people are looking that up. Buttigieg, as in Pete Buttigieg. Sheen, the fast fashion company. Then Speck ULoss3B, a new exoplanet that was discovered this year. There's Freeje, which was the Olympics mascot. Semaglutide, as in Ozempic, as in Novo Nordis. Zendaya and Chapel Roan. I think I went 10 for 10 there. Well, you did practice, but you did when, you know, when the spotlight shone on you, you executed well.

2:12So that was the U.S. list. In the U.K., the top word that people mispronounced was espresso, Sabrina Carpenter's song. And I guess the most common mispronunciation there was expresso. It's actually a very nice snapshot of the year in news, news, politics, science. If you go down the list, it does show what people were talking about. So I like talking about wrongly. Yeah. Talking about wrongly. Let's revisit this in 2025. Now a word from our sponsor Yahoo Finance. Neil, was it a fast week or a slow week for you this week? Slow week for sure. Coming back from a break is always tough. Agreed. A slow week for me, too.

2:47But fast week when it comes to the market. Once again, that is something I found. The market waits for no man. There are constantly new stories to be read and data to parse through. It's a runaway train that you can lose track of pretty quickly. Yahoo Finance can help tame the beast, though. It makes each fast week in the market feel a little slower, a little more manageable. Real-time market data, research reports, stock screeners, news updates you can trust. Yahoo Finance speeds you up so you can stay ahead of the curve. If you want your slow weeks to feel faster and your fast weeks to feel slower, head to YahooFinance.com today.

3:19Eczema isn't always obvious, but it's real. And so is the relief from EBCLIS. After an initial dosing phase, about 4 in 10 people taking EBCLIS achieved itch relief and clear or almost clear skin at 16 weeks. And most of those people maintained skin that's still more clear at one year with monthly dosing. EBCLIS, LibriKizumab, LBKZ, a 250 milligram per two milliliter injection, is a prescription medicine used to treat adults and children 12 years of age and older who weigh at least 88 pounds or 40 kilograms with moderate to severe eczema. Also called atopic dermatitis that is not well controlled with prescription therapies used on the skin or topicals or who cannot use topical therapies.

3:55EPCLIS can be used with or without topical corticosteroids. Don't use if you're allergic to EPCLIS. Allergic reactions can occur that can be severe. Eye problems can occur. Tell your doctor if you have new or worsening eye problems. You should not receive a live vaccine when treated with EPCLIS. Before starting EPCLIS, tell your doctor if you have a parasitic infection. Searching for real relief? Ask your doctor about EPCLIS and visit ebglis.lily.com or call 1-800-LILY-RX or 1-800-545-5979. Elon Musk and Vivek Ramaswamy traveled to Washington, D.C. yesterday to soft launch their Department of Government Efficiency, or DOGE.

4:27The two entrepreneurs met with lawmakers behind closed doors to kick off their much-hyped initiative to overhaul the federal government's bureaucracy, slash regulations, and trim wasteful spending. The exact mandate of DOGE is still murky, particularly because it won't be an official government agency, just an advisory body staffed by unpaid volunteers. Plus, there's plenty of skepticism that it will be able to achieve its leader's goals. Elon Musk has pledged to slash$2 trillion from the federal budget, but the math gets tricky slash impossible once you realize that the number represents about 30 % of all federal spending and two thirds of the budget funds programs like Social Security and Medicare that are effectively mandatory.

5:10So finding$2 trillion to cut seems to be some magical thinking. Still, there is a ton of energy behind Doge in Washington since pretty much everyone can agree that the federal government could use some pruning. And I mean everyone. Some Democrats and progressives have shown an eagerness to engage with Musk and Ramaswamy, including Bernie Sanders, who said this week that Musk is right about proposed cuts to military spending. Neil, can Doge make a dent? Well, let's take a look at one of their most hyped initiatives, according to them, which is to gut the federal workforce. And maybe that's illustrative of how this is going to work.

5:45So So the federal government employs 2.3 million people. That accounts for 1.4 percent of the entire U.S. workforce. In 2022, taxpayers spent$271 billion on payroll for these federal employees. How much of the overall budget does that account for? Four percent. So say we were to cut, say they were to fire half of the federal workforce and, you know, for three things, the Department of Defense, the Department of Veterans Affairs, and the Department of Homeland Security. So you would absolutely gut those particular agencies, services giving, or people giving services to people like veterans, and you would reduce the deficit.

6:29If you cut half of the federal workforce, you would reduce the federal deficit by less than 10%. So this is just some of the math that they're working against when you say you want to cut something like$2 trillion. And that's the math aspect of it. Just do a thought experiment real quick. Say we fired a bunch of DMV workers, people are still going to need their driver's license. They still need to register their vehicles. And yet now you're going to go into a DMV that has less workers there. They're handling two, three, four, five people. Does that actually make the government more efficient? And then the other aspect of government waste that they want to go after Doge does is fraudulent payments, which again is understandable.

7:09You don't want money going towards fraud. You don't want it being misappropriated. And yet, if you think about the way you push back against fraud is usually to add in more layers of maybe bureaucracy, more paperwork, more hoops to jump through and to ensure that the money is going to places you want it to go. And again, that doesn't really achieve your goal of efficiency as well. So they almost have an impossible task in front of them. It's a catch 22. Whenever you go after trying to cut places, unless you make cuts in precisely the right ways, it might lead to inefficiencies. Yeah, there's a great anecdote about what you were talking about, where trying to cut bureaucracy leads to even more paperwork.

7:45So there was a government conference in 2010 that was held in Las Vegas. It featured a clown and a mind reader, and that caused an absolute scandal. Why is the government spending our taxpayer funds on clowns and mind readers to entertain government employees? But that led to an insane amount of paperwork and documentation and even more inefficiency. now that every single time there's a government conference or any government employee travels everywhere, they have to fill out an insane amount of paperwork. So that just created even more, you know, red tape, essentially. That said, you did mention that, you know, I mean, a lot of Republicans are on board with this and even some Democrats, Bernie Sanders, Ro Khanna in California, they are aligned with Musk and Ramaswamy on at least a few of the issues.

8:29One of the ones where I think there is common ground between Democrats and Doge is military spending, which does it, which is a major, major line item in the federal budget. Bernie Sanders said, I would love to talk with Musk about, you know, these bloated government contracts for for military contractors. Ro Khanna said the same thing. He was like, you know, Elon Musk sees this from the inside because he at SpaceX is a big government contractor for for for the Pentagon budget. So maybe that is an area where that we do spend a ton of money that where they could find common ground. I do think that the main takeaway here is one, the task is gargantuan.

9:06It will be difficult. But on the other hand, lawmakers are willing to play ball. Senator Susan Collins, who actually leads the Appropriations Committee, did have a hour long one on one meeting with Elon Musk. He didn't make a presentation. They were just chatting through ideas. But clearly there is some momentum here. Whether they can pull it off, that is remains to be seen. And it's not the first time there's been a government efficiency agency that, you know, trying to clean this up, Reagan did in 1982. So this is, you know, every decade they try to do something less. We'll see whether they can get anything done.

9:37For this next story, we're going to do a little role-playing exercise. If you are at a holiday happy hour and a young person walks up to you and hands you a Guinness, do you A, politely decline, B, take a small sip, or C, tactically chug it so that the line marking the barrier between the dark stout and the creamy foam on top lands between the G and the harp logo on the outside of the glass? Good job, everyone. The correct answer is C. Splitting the G, as it's called, has found its way into online culture, propelling Guinness out of old Irish pubs filled with old Irish men and into the glasses and gullets of younger Americans.

10:13One Boston pub owner told the New York Times that they had to purchase 63 % more Guinness this year to keep up with skyrocketing demand. Some reasons why the drink might be having a moment outside the popularity of splitting the G. Guinness is best enjoyed straight from the tap, so a return to more social drinking after the pandemic could be providing a boost. Also, from Paul Mezcal on the big screen to Sally Rooney on bookshelves, Irish culture in general is just in right now. Neil, these tailwinds Guinness is experiencing means that the biggest issue it's facing ahead of the holiday season is, will there be enough of it?

10:46That's true. This week, Diageo, which is the big beverage conglomerate that owns Guinness, actually limited pubs in the UK from sourcing Guinness each week leading up to Christmas because they just haven't made enough to fulfill booming demand. In the year to June, worldwide sales of Guinness were up 15%. Meanwhile, the overall beer industry is in decline. Sales were basically flat between July and October for the global industry, but volume of Guinness consumed from kegs was up more than a fifth. So even as the overall industry stagnates, Guinness is skyrocketing. I do think it is fascinating all the different aspects that have thrusted Guinness into a kind of being the leader really in a semi-dying category.

11:34Another one is that Guinness has been working very hard to shed its reputation as a heavy beer. I mean anyone who's seen a pint of Guinness, it looks like a meal in a glass. It is so heavy. The foam on top seems so thick. But really, they've been on this marketing campaign to show that we're actually not that heavy of a beer. It's 4.2 % alcohol by volume. That's about the same strength as a Bud Light. There's only 125 calories per a 12-ounce glass. That's the same as Modelo Especial. So despite what looks would show, it's not as heavy as people think. And as the beer industry kind of shifts away from these heavier craft beers, people are saying, wait a second.

12:10Guinness, despite what it looks like, is a much lighter beverage. Okay, what the people actually want to know is, have you split the G? How hard is it to walk us through this process? Well, there's a little bit of controversy, actually, as to what the target is when you're splitting the G. The way I've done it is between the bottom of the G and the harp logo, but some people try to split the actual middle of the G itself. So depending on which pub you're in, depending on if you're in Ireland or America, there is a little bit of controversy. But there is this rise in so-called gin-fluencers. That's a real term that's been flying around on social media where this tradition, whatever you want to call it, started way back, like 2015 era, 2017 era in Ireland, in the UK.

12:56And it has slowly made its way across the pond. You had never heard of it before this show. I don't know what that says. We got to take you to a pub, Neil. Yeah, Hartley's. And another part of the Guinness boom is that there is some sort of craftsmanship involved in pouring it from the keg. There's a right way to do it that takes minutes to do. And there's an Instagram account that ranks all of the bars based on how they pour Guinness. And the best one is Hartley's in Brooklyn. So if you're looking for the best pint of Guinness, that is your best bet. We should go there this weekend. On April 15th, 2019, the world watched in horror as Paris's Notre Dame Cathedral was engulfed in flames.

13:32The 12th century Gothic masterpiece, a French national monument, suffered major damage to its upper walls and vaults while its roof and iconic spire were destroyed. But out of the ashes, a phoenix rises. This weekend, Notre Dame is reopening to the public once more. In what experts are calling one of history's most remarkable restorations, the church has been rebuilt in a colossal effort involving more than 1 ,000 artisans and 250 companies from all over the world. Even more remarkable, the restoration took just over five years since the fire and came in under budget. The restoration project had raised over$900 million, but spent an estimated$737 million on the rebuild.

14:14Toby, even as the church was still burning that April, French President Emmanuel Macron vowed to reopen it in five years. It took a Herculean effort, but they pretty much did it. They pretty much did it because there was so much support from really French's elite class to get this thing back up because it is just a symbol of national pride. In the days and even the hours after the fire, you saw these almost like one-upmanship coming in from a lot of these billionaires where the richest families in France, like I'm talking about the caring family, they said that they would, from luxury good fame, would give$113 million.

14:50Then LVMH's CEO, Bernard Arnault, pledged$226 million. The L 'Oreal Foundation gave$226 million. So it really became this big game of like, we want to get this back on board, but it was also almost like this public display of who can support it the most. And then, yeah, Macron played a big role as well. He said five years, we're going to open it. He put this very hard deadline with the sheer amount of the work they had to do. But they came in under – it's wild that they came in under budget when you consider just how much went into restoring this building. Yeah, I mean, let's talk about some of those restoration processes because this thing was built originally in the 1100s.

15:32And what they did to repair some of this was just go back to the way those craftsmans did it back then 800 years ago because they were like, man, this is really good. This withstood the test of time for the most part. So they did things like take the organ down to the south of France and just repair it with the same materials that it was originally built with, like sheepskin and animal glue. One of the most impressive rebuilds of this entire thing was the roof, which is this incredible latticework of wood. They went into the surrounding countryside just like they did when building the original Notre Dame and took down 2 ,000 oak trees, brought them back, and made the roof again.

16:13So just incredible craftsmanship work. I would love to. I can't wait for this documentary to come out to see how they built this. But, you know, it also reminds me of the fact that cathedral, something that's like 900 years old, is constantly getting destroyed, rebuilt, destroyed, rebuilt again. So, you know, a cathedral is not necessarily just a finished piece from when it's originally started. It's like a work of constant motion. And I can't help but contrast Notre Dame reopening with the vote of no confidence as the French government. just went through where parliament is still trying to figure out how to run the country and then macron is definitely going to use this reopening as a chance to kind of bolster his political standing because he's on unstable footing right now so that is another undertone to this great victory for france but still they have some things going on behind the scenes that they have to figure out up next it's stock of the week dog of the week time

17:09when 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. This episode is brought to you by State Farm. Checking off the boxes on your to-do list is a great feeling. And when it comes to checking off coverage, a State Farm agent can help you choose an option that's right for you.

17:48Whether you prefer talking in person, on the phone, or using the award-winning app, it's nice knowing you have help finding coverage that best fits your needs. Like a good neighbor, State Farm is there.

18:03Welcome to Stock of the Week, Dog of the Week, where we pick one stock from the week's news that knows there are still 25 days left in the year and is making use of each and every one of them. And one stock who is already looking ahead to 2025 whilst forgetting the gift that is the present. Neil, I won the pre-show grammar competition. You did good, but I did well. So I'm up first. And my stock of the week is Robinhood. The brokerage firm has quietly been staging a nice comeback over the past weeks, months, and year to climb back over its IPO price. It's now up 217 % year-to-date. It's worth about$35 billion and just hosted its first Investor Day event this past Wednesday.

18:43CEO Vlad Tenev laid out a future where Robinhood has its hands on everything from stock and crypto trading to maybe sports betting. One interesting tidbit from the Investor Day was that Robinhood sees desktops as a pillar of growth over the next few years, as the Wall Street Journal put it. According to the company, about 50 % of overall retail trading takes place away from mobile devices, but only makes up about 10 % of Robinhood's volume. It's an interesting strategy. Robinhood first caught on for offering zero-fee trading, attracting a more casual crowd of investors to its app. But now, Neil, it's looking to go deeper with more serious, more sophisticated traders.

19:20Yeah, it doesn't want the people like you and me that just buy random stocks on our phone. It wants people who have the three monitors set up are very serious traders. They also bought a company called Trade PMR, which caters to a registered investment advisors for 300 million dollars. That's a planned acquisition. So that and so those registered investment advisors, you know, trade stocks and own and have custody of clients money. So they bring a huge portfolio of business with them. So all of these initiatives right here speak to Robinhood going after a more intentional investor rather than the amateur one that maybe propelled them to fame a few years ago.

20:00Yeah, just look at the inroads they've made with people who do have more sophisticated financial needs. According to their Investor Day, 45 % of recent users earn six figures or more. People who are at least 44 years old now make up a quarter of recent users. And about 60 % of recent users are married or living with a partner. So it's not those kids in the basement. It's not the people who maybe propelled the meme stock mania of COVID of 2020. It is just normal people with normal and increasingly more sophisticated financial needs. So you can see kind of that Robin Hood saying we're in the next phase of reiteration.

20:33We want to go bigger here. What do you make of their their push potentially into sports betting? I mean, it's not sports betting as like you traditionally think about. It is. They're trying to create these like these markets, essentially prediction, prediction markets. which they rolled out ahead of the presidential election. So that was, I think, a test run for them. So they're thinking like, hey, this is clearly something where people are interested in. Why would we not skate where the puck is going? So I do think that there's nothing planned on the books right now, but they're definitely looking down that path.

21:02Yeah, I think bottom line for Robinhood is it's in growth mode once again. My dog of the week is the Hawk Tua meme coin. This launched Wednesday night to quite a bit of hype, but plummeted in value on Thursday, causing many people to lose money on that thing. For everyone asking, Neil, are you serious right now? Yes, I am. And here's what happened. Hayley Welch, the girl who went viral for an interview in the summer and has stayed in the internet limelight, launched a meme coin to, in her words, unite her community. Right after launch, the coin shot up to a market cap of$490 million before plunging more than 91 % in the span of a few hours yesterday, down to a value of less than$30 million.

21:40Welch and her team were immediately accused of executing a rug pull, a scam in which insiders hype up a crypto before selling it at a profit, disappearing and leaving regular investors holding the bag with nothing. Welch defended herself yesterday, denying any insider sales or activity. Either way, the reason we're even sharing this story is that it showcases the boom in meme coins since the election last month. Bitcoin may have just hit 100K, but the smaller meme coins have been snagging even more momentum and attention to the point where the Hakutuha girl is now at the center of a crypto controversy.

22:14Toby, is this the top? I don't know. I mean, Hayley Welsh is absolutely speed running the internet at this point. She got the viral video. She launched the podcast. Of course, the next thing to do is launch a meme coin, but it does speak to kind of the current iteration of the crypto market that we're in right now. I mean, you go back, we had the NFT craze. Now we're in the meme coin craze. Dogecoin, which is the original meme coin, if that's what you want to call it, named after the Shiba Inu meme that a lot of people know, it's outperformed Bitcoin over the last month. I mean, we were just talking about the Department of Government efficiency is literally called a Doge.

22:48So clearly, memes are driving culture right now. And just to be clear for everyone listening, the point of these coins is that they don't have a point. There is no business model. There is no cash flow. There's no underlying asset that you're buying. You are truly just buying into the fact that there's a shared understanding of an inside joke on the internet. So whether you think that has real value or not, clearly it does based off of the market valuations of these meme coins. But these are these highly volatile tokens. They're not something that your finance 101 professor ever talked about, but they're clearly hot right now.

23:20And let's run through some of these meme coins. And maybe, Toby, you can explain to us millennials what these are. But there's one that's called Mudang, which is that pygmy hippo that was born in Thailand and has become a meme. That's probably the easiest one for people to wrap their heads around. Mudang is just a meme. Like you saw her go viral on social media. Now there's a coin that is tied to her value. It is worth a lot of money. But that is probably the easiest one to kind of wrap your head around. And then there's Peanut, which is named after the orphan squirrel who was euthanized by New York authorities and became a right-wing talking point ahead of the election.

23:55And then another one is called Chill Guy, which is the meme of just the Arthur looking dog. Yeah, Chill Guy, hands in pockets, going viral on TikTok, going viral on X. It has reached a market cap of$466 million. Peanut has hit$1.2 billion. There is a lot of money pouring into these things, unfortunately. In the end, in the long enough timeline, they all go to zero. Not necessarily. Well, I guess Doge now. Dogecoin is worth$60 billion. It's worth more than Target right now. So it depends on the enduring character of the mean. Maybe these more flashy. I would say the vast majority go to zero, but the ones that endure and become part of the culture, like Dogecoin, do seem to have some legs.