Google's AI Leapfrogs its Rivals & Trump-Mamdani Tackle Affordability?

0:28The best B2B marketing gets wasted on the wrong people.

0:37good morning brew daily show i'm y 'all freiman and i'm toby howell today how a weight loss drug helped eli lily make history then how google went from afterthought to alpha in the ai race it's monday november 24th let's ride

0:56Good morning and welcome back to the week, a short week for Thanksgiving. Random acts of kindness, holding the door for someone, leaving a kind note on a stranger's car. They give you this warm, fuzzy feeling. But what drives people to do them? According to new research, Batman. Psychologists in Milan ran an experiment on the city's subway systems to study pro-social behavior or the act of helping others. In one scenario, they had a woman appearing pregnant enter a subway car alongside an observer and counted how many people gave up their train seat for this woman. In the second scenario, they added a dark night twist.

1:31As the woman came on board the train, a man dressed as Batman entered from another door. The difference was stark. In the presence of Batman, 67 % of passengers offered up their seats, but only 38 % did in the control experiment. Toby, what is going on here? It makes me think Batman needs to be in our podcast studio and just looming over us, prompting us to act and behave better. It's tempting to think that people were afraid that Batman will beat them up and pursue justice if they didn't give up their seats. But in reality, it just shows the power of introducing something weird into people's daily lives.

2:05If you jolt people from their routines, they will engage in more pro-social behavior where you're more likely to help those around you due to the presence of an unexpected event. Case in point, 44 % of people who offered their seats didn't even notice Batman was there, showing it can often just be a subconscious thing. However, I do want to give Batman some credit. People associate superheroes with things like gender roles and chivalrous help, so got to give some credit to the Dark Knight where credit is due. And now a word from our sponsor, U.S. Bank. If you're anything like Neil and me, you've created a detailed, color-coded budget to keep you on track this holiday shopping season.

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3:16Bank Split Card. Learn more at usbank.com slash split card. That's usbank.com slash split card. For years, the narrative surrounding Google was that it was a slow-moving incumbent blindsided by open AI, a classic tale of a big tech giant getting outmaneuvered by a brilliant and nimble startup. Well, how the turntables have turned. With the release of Gemini 3 last week, America hasn't been this excited by a next top model since Tyra Banks was telling girls to remember to smize. The new Gemini jumped past OpenAI's ChatGPT5 to become the consensus best performing chatbot on the market. Then on Thursday, it launched an updated version of its image generation tool, NanoBanana, which the VP of Google Labs told CNBC is incredible at infographics.

4:02It still lags OpenAI in terms of usage. Gemini has 650 million monthly users compared to ChatGPT's 800 million weekly users, but it's making up ground quickly. Google is on a roll outside of AI, too. Its self-driving subsidiary Waymo continues to expand its territory and recently started driving on highways for the first time. And YouTube just flexed its muscles in a carriage dispute with Disney, showing the integral role it plays as a powerful new content distributor. Investors have certainly taken notice. shares of Alphabet are up more than 77 % since the summer, pushing its market cap to$3.6 trillion, surpassing Microsoft for the first time in seven years.

4:45Neil, if you go back to just a few years ago, Google seemed lost, uninspired, and caught flat-footed. Now it's got its swagger back. Yeah, Mark Benioff, the CEO of Salesforce, knows a thing or two about software, tweeted about Gemini 3, holy bleep, I've used ChatGPT every day for three years, Just spent two hours on Gemini 3. I'm not going back. The leap is insane. Reasoning speed, images, video. Everything is sharper and faster. It feels like the world just changed again. How is this all playing at OpenAI? Not too well. OpenAI CEO Sam Altman told coworkers, we know we have some work to do, but we're catching up fast.

5:23I expect the vibes out there to be rough for a bit and that Google's leapfrogging of them in terms of chatbot capabilities could, quote, create some temporary economic headwinds for our company. So the narrative has completely shifted here, Urey, over the past few years because Google is just releasing, Google just released the best chatbot out there, period. I would be nervous if I was OpenAI, too, because not only are you being outperformed, you're also just behind the eight ball when it comes to economics. OpenAI projects to burn$100 billion as it pushes towards superintelligence. Right now, it's on track to make$13 billion in revenue this year.

5:58So even right there, the math ain't mathing. Then you look at Google. Google has generated free cash flow of$70 billion over the past four quarters. And part of that revenue is derived from providing cloud services to competitors like OpenAI. So not only does it make more money, it's making money off of OpenAI's push for super intelligence as well. So if you just wanted to compare those two companies, now Google is ahead of it on performance and the economics has always been in its favor. Yeah, Google reported record revenue last quarter of$102 billion. That means Google makes in one quarter eight times what OpenAI will make this year.

6:34So it has a lot of money to spend on resources. You might be wondering, we're saying, oh, this is the best chatbot. It beat all of these benchmarks. It crushed rivals. How do they test chatbots? Well, one of these tests I think is very fascinating. It's called the Vending Bench. And it asks a model to simulate how to operate a vending machine. So you got to track inventory, place orders, set prices. You have to make money in this simulation of running a vending machine. And apparently Gemini 3 is just a vending machine beast and can make so much money operating vending machines. They're very impressed with how Gemini 3 can do this.

7:09That's just one of the possible benchmarks where they say, okay, chat GPT, run a vending machine. Gemini 3, run a vending machine. And apparently it crushes it. You need both the anecdotes and the testing data as well, because there is obviously there's this thing called LM Arena where you put all these models against each other and you can make your models do really well on the test that all these benchmarks use. So that's why Mark Benioff's quote is important, too, because it's clear that Google made something that is good for people to actually use, not just something that does super well on the testing in the arena benchmark.

7:40So that qualitative as well as quantitative approach shows that Gemini 3 is in a really good spot. And you're right. Google is exceeding outside of the AI race to Waymo just got a license to operate across across a vast swath of California. Previously, it just been in the cities. Now it's got the entire Bay Area, Sacramento, almost all of Southern California up to the Mexican border. It's not currently operating there, but if it wants to, it could drive you from North Los Angeles in the valley down all the way to Tijuana in the Mexican border. So the red eye Waymo drives are about to come. I did see people tweeting out.

8:16So Waymo tweeted out their new expanded territory, and they did it like it's colored like an empire, basically. And so people were putting it next to the Roman Empire and saying, like, hey, this is how it starts, but this is where it's going to get. It is expanding rapidly. And then the final note I'll make on Google is we haven't even talked about YouTube that much. YouTube is absolutely killing it. According to a new report from Pew Research Center on America's social media usage last year, YouTube is the most widely used online platform for both U.S. adults and the teens. 84 % of U.S. adults say they've used YouTube.

8:48That's compared to Facebook in second at just 71%. So it is the de facto – I mean I don't even know if you call it social media at this point, but just it is TV. It is entertainment. It is everything. People are spending more and more of their time on YouTube. All right. Everything is coming up Google. Moving on, kvetching about high prices can bring anyone together. Just asked President Trump and the next mayor of New York, Zoran Mamdani, who held a surprisingly chummy meeting on Friday as they touted plans to address the affordability crisis. A beaming Trump, who's called Mamdani a communist, said he would be cheering Mamdani on as he takes charge of the largest American city, while Mamdani, who considers Trump a fascist, said their chat was productive.

9:29In his come-from-nowhere campaign for mayor, Mamdani was like a thoroughbred with blinders on as he focused relentlessly on New Yorkers high cost of living. He returned to the topic again and again during his meeting with Trump saying we're in the wealthiest city in the history of the world and yet one in five can't afford$2.90 for a MetroCard. Trump and other policymakers have seized on the popularity of this message and turn their attention to bringing down costs for Americans. Because right now, Americans do believe that life's necessities are getting out of REITs, stretching their budgets for things like groceries, health care, child care, energy, and housing.

10:03Recent surveys show the extent of the pain. Consumer sentiment fell to nearly a record low in November, tumbling to a score of 51 out of 100 from 71.8 a year ago. A new Fox News poll found that 76 % of respondents held a negative view of the state of the economy, down 9 % since just July. Toby, affordability is making a late surge for word of the year. It is, and it's not a very easily to define a thing because if you actually zoom out to the macro data landscape right now, real personal income is up 2.3 % year over year. Real hourly wages are up nearly a percent year over year. Right now, people are making more money, but they still feel this affordability crunch because affordability is just an amalgamation of a lot of very small micro instances.

10:51When you go to the grocery store, do eggs cost more than they did a year ago? Does your electricity bill go up a few dollars from a year ago. These things all combine together to say, all right, we are in affordability crisis right now. And that is why there is such political heft to targeting affordability, because something is always going up in prices. And you can always say, hey, I will come in and make things cheaper, which is why we're just seeing a flurry of attention on it. Because one, it's harder to find. Two, it is a crisis. Things are always going up in price. And the three, you're always going to score political points when you are talking about it.

11:29Let's talk about the affordability crisis as it pertains to these various buckets that I mentioned, like the things people spend their money on to just live their lives on a daily basis. First thing is housing. Homebuyer today needs to earn$121 ,000 a year to afford a typical home. And the average American earns about$84 ,000 a year. So right there, you see a 25 % increase in housing prices since 2019 levels. When you ask the average person what's become affordable, the first thing they'll say is housing. Then you move to child care in 2024, according to Child Care Aware America. The average annual cost of care for one child around the U.S.

12:09topped$13 ,000, which is up 30 % from 2020. So child care is extremely expensive. Health care is also getting even more expensive. There are 165 million people who are on their employers' health insurance plans that are expected to see their premiums spike by up to 7 % next year come January 1st. That's going to be the largest jump in health costs in 15 years. Finally, let's round it out with electricity costs. This has become a very salient political issue with data centers going around and gobbling up a lot of energy usage. Americans pay$265 per month in utility costs currently. That is a rise of 12 % since last year alone.

12:49And overall, 124 million Americans are expected to see some sort of rate increase in their energy bill, according to a new report from Powerline. So you just go across the board. What do I, what are my monthly bills, childcare, healthcare, food, groceries, electricity, everything's going up. And that is feeding this sense that, you know, I'm just an average American. I can't really afford life. That's the issue though, is how do you lower prices? and it almost never actually happens outside periods of recession or depression. So that is the issue. And again, why I say that it will always be a talking point, because if you want prices to actually fall, not just moderate in how much they are rising, which is what most people talk about when they say about, you know, taming inflation, inflation still means prices are going up.

13:33If you want prices to actually fall, the only times that normally happens is during periods of economic turmoil. So it's kind of a catch 22. If you want price to go down, you're going to have a lot of economic pain that comes along with it. Welcome to winners of the weekend, the segment where Toby and I pick two things that have a lot to be thankful for. I won the pre-show Wordle race, so I get to go first. And my winner is Eli Lilly, because on Friday, it became the first healthcare company in the world to reach a market cap of$1 trillion. Lilly's stock has been a rocket ship in the past few years because it makes the best selling drug in the world, an injectable known as ZepBound or Manjaro that helps people lose loads of weight.

14:12For a while, it was in a tight battle for GLP-1 supremacy with Danish rival Novo Nordisk, the maker of Ozempic and Wigobi, but recently it's left Novo in the dust thanks to more effective treatments and a savvier sales strategy. Lilly was not an overnight success. In fact, it was all the way back in 1876 when Civil War veteran Eli Lilly himself opened a drugstore in Indianapolis that would later become a globe-spanning pharma giant with 50 ,000 employees worldwide. Lilly has hit pay dirt with blockbuster drugs in the past, including the earliest polio vaccine, insulin and Prozac, but growth has gone into overdrive as it's dominated the weight loss revolution.

14:49A lot of credit has to go to CEO Dave Ricks, who President Trump called one of the hottest people in the world of business, not about his looks, but about his ability to create shareholder value. When Ricks joined in 2017, the company's market cap was$81 billion. It's surged by more than$900 billion in value since then. Toby, Lilly might be the most successful Hoosier since Larry Bird. Dave Ricks is crushing it. And also Eli Lilly is kind of becoming a cultural touchpoint as well. I mean, they sponsor the Indiana Fever. They have this huge president in Indianapolis, so it makes sense. So they're on Caitlin Clark's jersey.

15:23He was recently spoofed on SNL, which is kind of a cultural marker. He's been on a podcast tour. So all of a sudden, this very non-sexy industry of pharma is going to the White House, like in getting meetings with president trump like you know tech ceos too they they are a a trillion dollar company after starting uh south of a hundred billion dollars when he first took took over so pretty remarkable rise one of the interesting things about elia's journey to a trillion dollars is that they didn't do covid vaccines either during the pandemic lily kind of missed the boat when it came to it uh companies like pfizer's modern pfizer and moderna doubled down on it and absolutely ripped during the pandemic.

16:04They have been mired in a post-COVID slump ever since then. Eli Lilly mined the fertile waters of, you know, the GLP-1 craze, and they have done much better long-term. So what looked like a misstep at the time has turned out to be a blessing in disguise. Well, it was interesting also about Eli Lilly is if you thought of them in the past decade or so, the thing that came to mind was insulin prices, because over two decades, Lilly raised the sticker price of Humalog, which is its popular insulin, by more than 1 ,000%. And this drew a ton of backlash. In 2023, after this huge public outcry, they cut their sticker price of Humalog.

16:41But it was this whole drama that this was what Eli Lilly was known for, was gouging people with their insulin. And now it's become something different. It's helping people lose a lot of weight because they just happened upon this. I mean, of course, it was years in development, but they have it upon terms of peptide with Manjaro and Zep bound. So, you know, they're absolutely crushing it. And their pipeline is full to the brim as well. I'm not actually going to try to pronounce their two next drugs, but they have a daily pill that's coming down the pipeline, slightly less powerful, but a lot easier to take than injections.

17:13Let me try it. Or for Glapron. Yeah, there you go. I think you nailed it. Someone will correct us in the comments. And then also they have another GLP-1 injectable that is coming that is apparently the most effective yet, which again, I'll toss it over to you. I can see you trying to rehearse it right now. I am rehearsing in my mind. Retro True Tide. I think you nailed it. Retro True Tide. Both of those. So the pipeline is full, which is always big for pharma companies as well. All right, we're going to take a quick break and come back with my winner of the weekend. Neil, are you hitting your protein goals?

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18:19Buy four cartons, get the fifth free when you use davidprotein.com slash mbd. That's davidprotein.com slash mbd. If you prefer to shop in person, David is now in over 5 ,000 stores nationwide. Check out their store locator to find a location near you. Toby, do you have anything that's totally customized for you? Oh my goodness, yes. Here, let me show you my monogrammed bathrobe. I look amazing in it. Hard pass, but if you're looking for a customized online store and customer experience, look no further than WooCommerce. They're the open source commerce platform that helps you build a store as unique as your brand, from design to checkout to how you connect with customers.

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19:36Well, it came within a witch's broomstick of doing just that, bringing in$150 million at the domestic box office, just 13 million shy of what a Minecraft movie managed. IMAX came in clenched once more with 30 % of domestic screenings happening in large screen format theaters, up from 18 % from the first movie, as people wanted to see Galinda's evolution from Ozzie and Mouthpiece to government REPL in extra large detail. Wicked's performance combined with a projected strong opening for Zootopia 2 has box office watchers feeling upbeat again after a dismal October. Last year, the first Wicked, Gladiator 2, and Moana 2 combined to bring in the most money ever for the Thanksgiving period.

20:17But should Wicked keep up the pace, there's hope that this year could sneakily surpass last year's record haul. Neil, all this talk about movies led by movie stars flopping at the box office. Turns out all you need is some Ariana Grande and Cynthia Erivo harmonies. to make some moolah. Thank goodness. Yeah, the box office is feast or famine right now. If you talk to industry people, they say, wait, what really gets people out to the movies is by creating a cultural event around it, by creating some sort of movement. We saw this with Barbie and Oppenheimer. We saw this with a Minecraft movie where people went for the memes, essentially, and now, you know, Wicked created something special here.

20:56And they didn't create it just once. They created it twice. And there was this very ambitious strategy to break up this one show into two different movies. They spent$300 million on it, not including marketing. And every last November, it worked. And this November, it worked even better. This is how we're earning the original by 35%, although by all accounts, it's worse. Wicked Part 3 coming soon. They're going to somehow continue the story. No, I think one of the reasons it's also doing well is the fact that it's just a PG-rated movie. PG rated movies have started to crush it at the box office.

21:31Last year, PG movies accounted for 36 % of box office receipts. That didn't always used to be the case. PG 13 was seen as the messy middle. It was, you know, too risque for families to bring their kids to. That was for G rated movies. And then PG 13 was for all the cool kids and R rated movies for all the cool kids. But now PG movies are performing very well. You just go down the list. Most of the movies we've already mentioned, a Minecraft movie, that's PG. then you go to Lilo and Stitch, How to Train Your Dragon, those are two live action PG remakes, and then you go back to last year as well, Moana 2, Sonic the Hedgehog 3, Despicable Me 4, God, that's a lot of sequels right there.

22:08Those are all PG rated movies, so the sweet spot for the box office right now is what gets the families to come out, what gets the youths to come out, which is PG rated. Two sub winners from this wicked umbrella winner. Number one sub winner is Wizard of Oz. This IP is absolutely crushing it right now. You said what's going to come next with Wicked 3. Well, Wicked 2 goes for good, goes into The Wizard of Oz, the movie. It's like the natural lead in. And that movie is crushing it right now. It's at the sphere. It's by some estimates, it's making around$2 million a day. It's this AI reimagined, you know, larger than life screen adaptation of the original Wizard of Oz from back in 1939.

22:48People love being in Oz. And then my second sub winner is Ariana Grande for becoming an established blockbuster actor from being a pop star. Many have tried to do this. Harry Styles, Beyonce, Taylor Swift, Justin Timberlake, Britney Spears. They have all failed to do it. So she might be the first pop star to make that leap from the stage to the big screen in a big way. I guess the only other person who might be in that consideration there is Gaga. but Ariana Grande has proven herself to be an actor who can get people out and spending hundreds of millions of dollars on her movies. I don't know.

23:21I liked Taylor Swift in Cats. I thought she was really, really excellent in that. All right. It's Monday. So here are the events you need to know about in the week ahead. One of the busiest travel seasons of the year has kicked off ahead of Thanksgiving on Thursday. According to AAA, almost 82 million Americans will travel at least 50 miles this holiday, making it a bigger holiday for travel than even Memorial Day or July 4th. If your flight is messed up, you probably can't blame the government shutdown. Airport operations have basically returned to normal now that air traffic controllers and TSA agents are getting paid again.

23:52Still, they're bracing for what's expected to break a record for the number of Thanksgiving flyers. I was looking at the weather forecast, Neil. It looks like we're getting some rain on Monday through Wednesday from Texas up towards Minnesota and moving east. But come Black Friday, things should warm up a bit just in time for you to buy a lot of stuff if you probably don't need, but be wary of your flight back. A storm system is expected to develop over the weekend, affecting some central and eastern parts of the U.S. Now back to you in the studio, Neil. Thank you. Thanks for that weather report.