Global Chip War Heats Up & Bob Iger's $250M Women's Soccer Stake

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 Howe. Today, chip stocks got sent to the wood chipper.

0:38How geopolitics is slowing the role of the stock market's A-list. Then there's a new most viable franchise in women's sports, but will infighting sink Angel City before it can soar? It's Thursday, July 18th. Let's ride.

0:56Remember that 150 million year old stegosaurus named Apex that was up for auction? Well, yesterday it was sold and you're never going to guess who bought it or maybe you will. It was the hedge fund billionaire Ken Griffin. Griffin paid nearly$45 million for Apex, making it the most expensive fossil sale in history. And we've been here before. Remember, three years ago, Griffin outbid a bunch of crypto people to buy a first edition copy of the Constitution for$43 million. I'll just say it. This guy knows how to be a billionaire. He truly does. And I am so happy that it got$43 million,$44 million, because there were reports that it was valued in the$6 to$8 million range.

1:39Apex deserved so much better, so I'm glad it's now the most expensive fossil ever. Ken Griffin said Apex was born in America and is going to stay in America after the sale. That's kind of his thing is that he loves keeping what he thinks are American artifacts in America. He did that with the Constitution, which is now residing in our favorite place on Earth, Northwest Arkansas. saw. So he loves Spurgeon. He loves that$44 million range. Now a word from our sponsor, Meta AI. So Neil, only a few people know this, but I am currently writing a young adult fantasy book. Is it fantasy or romanticy? I don't have the literary expertise to pull off romanticy yet, so I'll leave the love and the dragons to others.

2:20But I found Meta AI to be helpful in the writing process. Since a lot of fantasy is world building, I like to see the characters in the environment I've created come to life. So I head to Meta AI, ask it to imagine the scene I just wrote, and then watch as it literally comes to life in front of my eyes. So are you gonna leave us hanging or give us a sneak peek about what the book is about? I'm keeping it under wraps for now, but you'll see it on a bestseller list soon enough or in a used bookstore bargain bin, one of the two. If you're like Toby and need a little creative boost from time to time, expand your world with Meta AI.

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3:37Wall Street's high-flying semiconductor index lost more than$480 billion in stock market value following a pair of ominous headlines for their businesses. First, in an interview with Bloomberg, former President Trump said that Taiwan should pay the U.S. for its defense, suggesting that he would be hesitant to defend Taiwan if it were to be invaded by China, a distinct possibility. Taiwan is home to chip-making giant Taiwan semiconductor, an absolutely crucial player in the technology sector. And if China were to launch a war against Taiwan, analysts believe the entire global economy would collapse, not hyperbole.

4:12That's how important this company is. The second headline that set chip stocks tumbling was that the Biden administration is reportedly considering slapping the most severe trade curbs in the entire playbook on chip equipment to China to prevent it from racing ahead in the tech arms race. Considering Western firms sell lots of equipment to China, this was also seen as a potentially major threat to sales. Toby, this was a bloodbath. Because of the semiconductor meltdown, the Nasdaq fell nearly 3 % for its worst day in two years. Chip companies are finding themselves squarely in the geopolitical crossfire.

4:45Yeah, fully a bloodbath. If you just go down the list, ASML, which is the world's largest supplier of Chebacca equipment, that fell nearly 13%. Taiwan Semiconductor Manufacturing Co., TSMC, closed down 2.4%, and then nearly 8 % in the U.S. after Trump's comments. Then NVIDIA fell 6.6%. The shockwaves just rippled throughout the entire stock market yesterday. Big tech was affected as well. And you also have to look at who didn't get hit as badly yesterday, which is interestingly enough, Intel kind of leveled off. It rallied a little bit. Global foundries actually gained yesterday. These are both manufacturers that are perceived as a little bit more insulated.

5:26They have more plans to get U.S. plants up and running. So it is just a different look at what the calculus would be if these trade export limitations are applied or if something happens to Taiwan. suddenly U.S.-based chip manufacturers become a lot more valuable. Let's look at what the Biden administration is proposing. And this was just a report from Bloomberg, so it hasn't yet actually come to pass. They want to use what's known as the foreign direct product rule. This is the most severe curb restrictions we have, which would impose controls on a company selling to China that literally has the tiniest amount of U.S.

6:05technology. It could just be one single part, and our technology is in so many products. The U.S. wants to present this united front against China. It's not the only company that makes equipment or chip equipment that sells to China. ASML is Dutch, and there's a company called Tokyo Electron, which sells companies to China, chip equipment to China. And the U.S. wants to say, guys, let's all band together and prevent China from winning this arms race. It doesn't think the ASMLs and Tokyo Electron is doing enough to prevent this equipment from getting to China. So it's saying, OK, we might just need to crack down on you because we don't think you're pulling your weight here.

6:44Biden is certainly walking a fine line here, though, because the U.S. already imposed the sweeping restrictions back of selling advanced chips and manufacturing gear to China back in October 2022. But U.S. companies are sitting here feeling like they those export restrictions have unfairly punished them. There was this report from the Federal Reserve that came out that said U.S. chip companies have lost$130 billion in market cap due to U.S. export controls because there isn't a united front right now. U.S. chip companies are saying, we're shouldering a much larger burden than any of these other companies that you mentioned.

7:18Why are you going to make it now even harder for us to sell our wares in China? All you have to do is look at NVIDIA's revenue in China to show how these export controls have dented sales. NVIDIA's revenue stood at about 18 % of, or China revenue stood at about 18 % of its total revenue in the previous quarter this year. That's compared to 66 % of its revenue a year ago. So it is just wild how much the calculus has totally changed and how much these import and export controls are affecting U.S. chip makers. And you're probably looking at your brokerage account this morning being like, what the heck happened?

7:52I mean, literally my mom texted me like, what the the stock market. It shows just how much chip stocks play a role in the stock market's rise. This year, the semiconductor index is up 32 % compared to the S &P's 17 % gain. Chip stocks are now the most weighted in the S &P 500. They passed software this year for the first time. So these companies are so critical to the global economy. They're running the stock market. You may not have heard of them, but they are a handful of giants that are basically running our economy right now and any little policy intervention here and there export restrictions to china there a little a war breaks out in taiwan there then this entire thing comes crumbling down a couple of big acquisitions went down yesterday one in streetwear and one in the sporting world up first angel city fc of the nwsl officially became the most viable women's sports team in the world yesterday after selling a controlling stake in the franchise.

8:50The lucky new owners of the$250 million club are none other than Disney CEO Bob Iger and his wife Willow Bay, the dean of USC's school of journalism. The duo take over from a couple big name owners, including Natalie Portman and Reddit co-founder Alexis Ohanian, as well as a smattering of other sporting icons like Abby Wambach, Mia Ham, Julie Fowdy, and Billie Jean King. But despite the celebrity owners box and a splash evaluation. Things have been a little rocky at Angel City since its founding a couple years ago. First, the play on the field hasn't always been great with just a first-round playoff exit to show for their first three years in the league.

9:27Behind the scenes isn't much better either with a Wall Street Journal report emerging that detailed lots of infighting amongst board members. Discord aside, this sale is another data point that shows just how much women's sports are growing and how serious these valuations are getting. I mean, we are in spitting distance with some of the lowest valuations of men's teams in North America. They're sitting at like$600,$500 million for some of the MLS and NHL teams. Buffalo Sabres are at$750 million. Colorado Rapids are sub$500 million. So at some point, we might see a women's team surpass a men's team in valuation.

10:05And if it's going to be anybody, it might be this Angel City because they bring in the most revenue out of any women's team anywhere in the world. $33 million in 2023. They have the biggest attendance in the NWSL. So if you see growth in this league, they are sitting atop of it in terms of brand. I don't know about you. You said they're not that good on the field. But in terms of building a brand and selling sponsorships and selling jerseys and selling tickets, they are at the top of the table. They have a ton of support locally, but I mentioned this infighting that's happening within the team.

10:40Part of the issue was the team's principal owner, which is Reddit's co-founder, Alexis Ohanian, he ceded a bunch of his control to others. He didn't want to be kind of the man in charge of this team. So this created this power vacuum, which the team's co-founders, venture capitalists, Karen Nortman, and then there's this entrepreneur, Julie Ehrman, have kind of taken over there. And it's led to some friction amongst other board members. So the Wall Street Journal did this top to bottom piece about how this team is so high flying. Like they everyone wants them to be good. Everyone wants them to succeed and they are succeeding.

11:15They're making a lot of money, but there's still a bunch of tension kind of behind the scenes, which hopefully they can get over because their goal is to become the first billion dollar women's sports team. And the way that they're progressing, I think that they can absolutely get there. Yeah. Willow Bay is an absolute power broker. Obviously, she's married to Bob Iger, who's the CEO of Disney. But she seems like she means business is going to come in. She's going to sit on the board of governors of the entire NWSL. She works in the USC campus, which is a walk away from where the Angel City team plays.

11:49So she's been a supporter of this team for a long time. And now she is an owner. It's just crazy to see where valuations have come from in the NWSL. I mean, back in 2019, three years before Angel City was founded, the Seattle Reigns sold for$3.5 million and now we're above$250 million. Meanwhile, the WNBA, the highest valued team there, the WNBA, the highest valued team there is the Las Vegas Aces at$180 million. And it was curious to me, and I don't necessarily know if I have an answer to this, is why an NWSL team is valued at so much more than the top-valued WNBA team, which seems like it gets more eyeballs on TV and just has generally a little more hype to it.

12:34I'll tell you why. Soccer is a beautiful game. People like soccer more than a basketball deal. All right. I don't know about that. But moving on to the other deal, eyewear meets streetwear in an odd pairing that will see Supreme fall under new ownership. Eyewear behemoth Essilor Luxottica, which makes Ray-Ban and Oakley's and literally every other accessory you put on your eyes, is buying streetwear brand Supreme for$1.5 billion. That's a cheaper price than the last time Supreme changed hands, which was four years ago when VF Corp paid$2.1 billion to add it to its portfolio. which includes the likes of Vans, North Face, and Timberland.

13:11If you're scratching your head thinking, an eyewear company buying Supreme? Not sure I see it. You should be a Wall Street analyst because they were wondering the same exact thing. And not only is Supreme outside of Essilor Luxottica's traditional comfort zone, the purchase also comes at a time when the streetwear Supreme is known for isn't as hot as it was. Essilor Luxottica says, just wait and see, we know what we're doing. They say Supreme gives it an entry point to that tech-savvy and hard-to-access Gen Z community, particularly in the growth area of Asia. Toby, do you buy this explanation or are you as confused as the rest of us?

13:47I am a little confused because I think Luxor Exotica is saying the exact same thing that VF said when they bought them a few years ago. They wanted to, VF is the maker of Vance and North Face, and they said that the sale, they wanted to bring in that same audience, they wanted to be more trendy, but it just didn't work out because these synergies with Supreme are very hard to develop across different brands. I mean, VF did do pretty well in the beginning. Their collabs with North Face and Vans were very hyped, but it's hard to continue that hype when you're selling these big brands. And what started happening is that Supreme collabs started not selling out like they used to.

14:25They started being on shelves for longer. You come in days later and still get the Supreme, which just dents the entire brand. So anytime you pair this very niche, very hype-driven brand with big brand labels, there's inherent tension there. I don't see how they're going to get around it. Luxor is going to get around of it. Luxotica is going to get around the same issues that VF Corp was kind of struggling with. Well, one collab they're going to try to do, it seems like there's going to be Supreme Meta Smart Glasses. Remember, there were Ray-Ban Meta Smart Glasses that sold really well. So that is one thing that they're going to try to do is put that Supreme label on glasses that have AI infused that have AI infusion.

15:08But, yeah, the Supreme acquisition for VF was just a colossal failure. I mean, they expected Supreme to bring in six hundred million dollars in revenue last year. But actually, that turned out to just be five hundred and twenty three million, which was a lot less than 2022 when they brought in five hundred and sixty one million dollars. So it seems like the glow around Supreme has faded as they've expanded. They have 17 stores now. They have double the amount of lines that they had just in 2020. So the streetwear boom does seem to have faded, but I wouldn't count it out yet. Right. It's not necessarily that the streetwear boom in general is fading.

15:43It's just different brands come and go. Fear of God is a lot more powerful and popular now than Supreme was. So it's just this is how trends come and go. Like they ebb and flow. Maybe they'll come out with very cool eyeglasses and it will become cool again. You just never know because this industry runs on hype, and that is something that's a very tenuous thing to grasp. Up next, say it with me, everyone. It's time for Neil's Numbers.

16:11Eczema isn't always obvious, but it's real. And so is the relief from EPCLIS. After an initial dosing phase, about 4 in 10 people taking EPCLIS achieve itch relief and clear or almost clear skin at 16 weeks. And most of those people maintain skin that's still more clear at one year with monthly dosing. EbGliss, 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.

16:47EbGliss can be used with or without topical corticosteroids. Don't use if you're allergic to Epglis. 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 Epglis. Before starting Epglis, tell your doctor if you have a parasitic infection. Searching for real relief? Ask your doctor about Epglis and visit epglis.lily.com or call 1-800-LILY-RX or 1-800-545-5979. I'm Christian McCaffrey, pro running back, and Abercrombie is an official fashion partner of the NFL. I'm not kidding when I say NFL by Abercrombie broke the internet last year.

17:20And I think this season's lineup is even cooler. And so does my wife, who keeps stealing all my hoodies. Stay fit for the season and Abercrombie's newest arrivals. Shop NFL by Abercrombie in the app, online, and in store.

17:41Welcome to Neil's Numbers, the segment where I share three stats from the week's news that will have you feeling like Jimmy Neutron. My first number is a rundown of the Emmy nominations that were announced yesterday, highlighting the best TV from the past year. And the show that got the most nominations of any was Shogun, FX's epic drama about 17th century feudal Japan that landed 25. I don't watch much TV, but I watch Shogun and I say give it all the awards. So good. Coming in second was Hulu's kitchen confidential The Bear, which nabbed 23 nominations and made history while doing it. It topped a 15-year-old record set by 30 Rock for the most noms by a comedy, though it's certainly up for debate whether a show exploring trauma, addiction, and toxic workplaces is actually a comedy.

18:27And if you're thinking, didn't we just do the Emmys? And yes, the award ceremony that was supposed to happen last year took place earlier this year because of the Hollywood strikes, so it's a quick turnaround with this year's ceremony airing in September. Toby, anything from the nomination stand out to you? Any snubs? No snubs for me. It was just, what stood out to me was just, this was an amazing day for FX. It landed 93 noms altogether. That made it the second most nominated network this year, coming in just behind Netflix. It actually jumped above HBO and Max. HBO and Max wasn't one of the top two networks for the first time in literal decades.

19:03It just goes to show that sometimes this happens with just the cycles of shows. House of Dragon wasn't considered yet. Some of its other big franchises weren't considered for this particular Emmy cycle. But still, FX just kind of out of nowhere, just had multiple bangers this year. And so they're sitting pretty. My next number is for everyone who's got the need for speed. But honestly, you probably don't want this much speed. NASA's Parker Solar Probe just tied its own record for the fastest moving human made object ever when it hit. Get ready for this. 394 ,736 miles per hour. It's a little hard to comprehend how fast this thing moves.

19:43So here's some context. It's 500 times faster than the speed of sound. It would take Parker 49 seconds to travel from Los Angeles to London and also less than a minute to get from Washington, D.C. to Tokyo. To fly around the Earth's equator, it would take it less than four minutes. So what's its secret? Is it doping, wearing the new Nike Alpha flies? Actually, the secret sauce is harnessing gravity with a mix of impeccable timing and precision. The Parker Space Probe orbits the sun, and once it gets into the neighborhood of Venus, it uses the planet's gravity to slingshot itself back toward the sun, which has its own massive gravitational pull to help it achieve mind-blowing speeds.

20:20Toby, you're a good runner, but I don't think you can beat this thing in a race. I love the Parker Solar Probe. There's so many interesting facts about it. Its goal is to get the closest that any man-made object has ever gotten to the sun. And still, that's only 3.83 million miles away, but still, it's very hot there. It is the first NASA mission to be named after a living person. It's honoring the physicist Eugene Parker, who predicted the existence of solar winds. And my favorite part, too, is how the heck do you keep this thing cool because it's getting so close to the sun? It's got this very thick heat shield that can withstand its temperatures up to 2 ,500 degrees Fahrenheit.

20:58It keeps the internal components at a balmy 85 degrees, which, again, in the vacuum of space is actually very hot, but given how close it's getting to the sun. So I highly recommend you go down the rabbit hole of the Parker Solar Probe. Do you have any Parker Solar Probe facts you want to say? One is the list of the fastest-made human-made objects. That is very interesting. And at one point in 1957, the record was held by a nuclear test borehole cover, which was blasted into space at 150 ,000 miles per hour after a bomb detonation in Los Alamos. So at one point, that borehole cover was the fastest thing humans have ever made.

21:37My final number may be disappointing to those of us who think we're better than everyone else because we wake up before the sunrise. Turns out early risers may not be better off than night owls, at least when it comes to brainpower. A new study from Imperial College London suggests that people who feel more alert and productive in the evening, those night owls, tend to outperform us early birds on brain tests. Looking at data from more than 26 ,000 participants, the researchers found that evening people scored up to 13.5 % higher than morning people on cognitive assessments. In fact, people who said they were definitely morning people performed worse than both the hardcore evening people and the ones who only showed a slight preference for morning or evening.

22:18While the study has limitations, it definitely challenges the widely held belief that the most productive people in society get up early. But honestly, I think this is just one of those debates that is never going to be resolved no matter how much research is done on it. Well, I want to go to those limitations you said the study had because I want to defend our good honor as morning people. Part of the limitations were the study did not account for education levels. And then they also did not include the time of day the cognitive tests were conducted. So again, if you are a night owl and the test was conducted first thing in the morning, you'll perform worse.

22:53And then same thing for us early morning people. If you conducted in that like two to three afternoon slump, I am not doing well at a cognitive test. But yeah, I do think we should rethink a couple of things about the way we approach sleep. One is the first thing I thought of was just our school system in the U.S. Teenagers are forced to wake up at ungodly hours. It felt like an ungodly hour at the time. It was just like 7.30 a.m. But if you are a growing person and maybe you perform better at night, why are we forcing people to wake up and just zombie walk through the first few periods of high school?

23:27So just an interesting study, I would say. But I do want to defend it. Are you running for college or for a high school class president now? I think I'm running for Senate. My name is Toby Howell and I'm running for U.S. Senate on the backs of make school start later. Neil, pool sales have fallen off the deep end. Only 60 ,000 residential in-ground pools will be constructed this year, according to estimates, which is half as many as in 2021. If the market continues at its current pace, we could be looking at fewer pools built than the 54 ,000 that were constructed during 2009, smack dab in the middle of the Great Recession.

24:03So why are pool sales circling the drain? Well, higher interest rates means less people can afford to finance a pool. Prices are continuing to rise even if demand is down. And after the pandemic surge that came from board honers adding a little leisure to the backyard is finally fading. Even amidst a historically hot summer, Google searches in the U.S. for swimming pool costs were the lowest they've been for any June on record. Neil, we are in a pool session, a poolpocalypse. This is a pooltastrophe. It really is. I mean, everyone who has a pool has a pool because they bought it in 2020 and 2021.