Grok’s Explicit AI Images Sparks Global Backlash & Why Trump Wants Greenland

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

0:36good morning brew daily show i'm neil freiman and i'm toby howell today why frigid greenland is the hottest real estate in the world then the lego just unveiled its biggest update in 50 years it's wednesday january 7th let's ride

0:55Good morning. Next time someone hands you back some change, make sure to take a second look. Starting on Monday, the U.S. Mint began to circulate special new quarters commemorating the 250th anniversary of the founding of the United States. There is a Mayflower quarter featuring pilgrims and others coming later this year include designs around the Revolutionary War, Declaration of Independence, and Gettysburg Address. Toby, remember when they did that 50 state quarter series. I was so locked in, had my own collection book and everything. That's the least surprising thing I've ever heard out of you.

1:28It was fun discovering new coins, but I am sitting here trying to remember the last time I even used a coin or looked at a coin. And unfortunately, I think it was as a ballmark on the golf course, which is it's not its intended purpose. Also, as part of the America 250 rollout, there's been a push for a Trump coin that has his image on it. The Mint has a full design proposal on its website. Only issue there, and sort of a fun fact, federal law actually prohibits any living person from being on U.S. currency. So, that MBD coin you were hoping for, Neil, better luck in another life. Now, a word from our sponsor, Rubric.

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2:42If your business relies on AI agents, you need the ability to monitor, govern, and rewind their actions. Right now, our listeners get exclusive early access to Rubrik Agent Cloud. Head to rubrik.com. That's R-U-B-R-I-K.com, rubrik.com. After a military operation that resulted in the capture of Venezuela's Nicolas Maduro, Trump looks keen to treat the world like a big game of risk, setting his eyes on the icy island of Greenland. Multiple people within the administration have made it clear that the push is on to acquire Greenland, which has been an autonomous territory within the Kingdom of Denmark for most of the last century.

3:21But Stephen Miller, a top aide to the president, told CNN yesterday that the U.S. could seize the semi-autonomous territory if it wanted to. Nobody's going to fight the United States military over the future of Greenland, Miller said. Secretary of State Marco Rubio backed down a little from that stance, reportedly telling some congressional lawmakers in a briefing about Venezuela that President Trump plans to buy Greenland rather than invade it. President Trump has been an open book on the topic, repeatedly stating his, quote, very serious about acquiring Greenland, arguing that the U.S. absolutely needs it for national security.

3:56Now, of course, geopolitics isn't a game of risk, and you can't just roll some die and take over a territory. Officials in Greenland, Denmark, and across Europe have pushed back on any U.S. claims, with Greenland's prime minister explicitly rejecting comparisons to Venezuela, saying the United States cannot simply conquer Greenland. We are a country that is democratic and has been democratic for many years. Denmark is also a NATO ally, prompting the leaders of France, Germany, Italy, Poland, Spain, the U.K., and Denmark to jointly release a statement saying that only the people of Greenland and Denmark can decide the island's future.

4:30This story has been sort of simmering in the background since Trump regained office. But after Venezuela, it feels a lot more pressing. What does the U.S. want with Greenland? Well, there are two main commercial interests there. One is shipping routes. So Greenland sits in a very strategic location next to the Atlantic and the Arctic. There is ice melting and there's going to be a lot of new shipping lanes that are being opened. And Trump is saying that there's a lot of Chinese and Russian ships at the ready to take over this shipping lane, which is going to reduce a lot of the time it takes to go from Asia to Europe when compared to the Suez Canal.

5:07So there's the shipping angle. And then there's also the mineral deposits angle. Greenland is sitting on a host of critical rare earth minerals that go into things like smartphones and laptops and electric vehicles. We actually don't know how much is there because it just hasn't been mined or surveyed because the landscape is so harsh. But you did see a lot of rare earth minerals and mining companies surge on the stock market yesterday. Critical Metals Group jumped about 25 percent on Tuesday. They have a rare earth project in southern Greenland. Then you look at Energy Transition Minerals, which has another rare earth project in Greenland that climbed more than 30 percent.

5:48So even if investors are getting ahead of themselves, they are somewhat hyped at the prospect of the U.S. having more commercial interest in mining Greenland for rare earth minerals that are right now controlled by China. Greenland has also been having a rough go of it in terms of their economy of late. They are heavily dependent on subsidies from Denmark, but they're also heavily dependent on the fishing industry, especially shrimp. Most of their economy is not rare earth minerals. It's actually just fishing for shrimp, and they've had a tough harvest of late. Shrimp stocks are declining there, so their economy grew only 0.8 % in the last year.

6:27They're also having a bit of a demographic crisis. Only 57 ,000 people live on this island. It's the biggest island in the world, but obviously it's a very harsh place to live, so their population is not big. It's also not growing. It's expected to decline by 20 % by 2050. So there are some people saying that maybe it is in the vested interests of the people of Greenland to have a larger economic force at your back, maybe diversifying your economy a bit and allowing it to get away from just relying on shrimp farming. Yeah. So what do the people of Greenland actually want? Well, there are opinion polls of this territory of 57 ,000 people.

7:02Opinion polls have previously shown that Greenlanders, they overwhelmingly oppose United States control, but at the same time, a big majority support independence from Denmark. So they have voted numerous times on whether they want to be independent from Denmark. And Denmark has also pushed back on that. But at the same time, a lot of Europe, all of Europe is pushing back on the fact that the United States should acquire it. They say it's not for sale. They obviously oppose military intervention in what would be an unprecedented attack on a NATO ally. Meanwhile, prediction markets are pricing in a greater chance of President Trump and the Trump administration really expanding this imperial vibe that they've been going off lately with the ouster of Venezuela's president.

7:48Odds are shooting up that the United States is going to somehow take control of the Panama Canal, that critical shipping route, as well as Greenland. So we will see what happens here. But it seems like at least in the administration, there are growing calls to do something to acquire Greenland. Scrolling on X never makes you feel good about humanity, but these days it downright gives you a pit in your stomach. That's because in recent weeks, users have been asking X's AI chatbot Grok to digitally undress pictures of women, even minors, which Grok has been happy to oblige. The spread of non-consensual sexual imagery across X has drawn outrage and investigations from governments around the globe.

8:27Here's how most of these situations have played out. A user will take a photo that a woman's posted to X, type in something like, Grok put her in a bikini, and Grok will generate a new AI image fulfilling the user's request. Often, the subjects of these deepfakes have asked Grok to remove these images. Sometimes X has deleted them, but other times it responds that they don't violate any guidelines. Governments are telling X to stop this practice or face consequences. UK Technology Secretary Liz Kendall called the situation, quote, absolutely appalling, and that the media watchdog is, quote, looking into this as a matter of urgency, and it has my full backing to take any enforcement action it deems necessary.

9:05Other places like the EU, India, and Malaysia have also launched investigations, and U.S. lawmakers on both sides of the aisle have condemned Grok's latest actions, calling them potentially illegal. Toby, how's Elon Musk responding to what's going on on his platform? Initially, Elon was kind of responding with amusement at the trend as a whole. If you go back to Friday, he responded to a picture of a toaster wearing a bikini and with his classic laughing, crying emoji. But then as it kind of escalated and this became a more prevalent practice across the platform that he owns, he did say that anyone using Grok to make illegal content will suffer the same consequences as if they uploaded illegal content.

9:48Basically saying that, hey, we're going to get a little bit more serious on this topic. But the legality of it is a gray area for a lot of kind of legal professors and scholars who say that Section 230 is basically the bedrock of the internet. Remember, Section 230 is a law that gives broad immunity to online platforms for most of the content published by its users. But when the platform itself, in this case Grok, is kind of one in the same with the platform that is X, is doing the posting, then it is potentially liable. And it does make Elon and X liable. So it is a very interesting, you know, legal case because these harmful outputs are coming.

10:29But who are they coming from? The user and the platform at the same time. Yeah, there is a law in the United States now. Actually, President Trump signed it last year. It's called the Take It Down Act. And that prohibits the nonconsensual online publication of intimate visual depictions of individuals of all ages. That's enforced by the Federal Trade Commission. But that law does not fully go into effect until May 2026. further complicating the legal gray area that is here in the United States, at least in Britain, creating or sharing non-consensual intimate images or child sexual abuse material is illegal, whether that's generated by AI or not.

11:03So you if I would say if X and Elon Musk don't take action to stop the spread of these images, looks like governments are going to crack down. And I just want to share the scale of this. And it does seem if you're on X, you're like, this is crazy. This is like pretty much everything I'm seeing. And researchers have corroborated this during a 24-hour analysis of images that Grok account posted to X that chatbot generated about 6 ,700 of these images every hour that were identified as sexually suggestive or nudifying. That's according to the deepfake researcher Genevieve Oh, who called the scale of this deepfake unprecedented.

11:41And by the way, this is not just an Elon Musk side project. XAI, in the same breath that this controversy was spreading across the internet, just raised$20 billion at a$230 billion valuation. So this is a massive part of his empire that we are talking about here that is distributing this sexually explicit material. Moving on, American Airlines wants this to be the last Thanksgiving it has to eat at the kids' table. The carrier announced it would be offering free high-speed Wi-Fi on nearly all of its flights by early spring to its loyalty program members, which doesn't cost anything to sign up for.

12:16Free Wi-Fi? You might be less than whelmed. Shouldn't American, the century-old airline offering more flights than any other, already have that? Aye, there is the rub. American is being left in the chemtrails by United and Delta, which have distanced themselves from the pack by focusing on premium customers, credit card partnerships, and luxury experiences, aka how you actually make money in the airline business these days. Consider the first nine months of last year, Delta made a profit of$3.8 billion. United made a profit of$2.3 billion, but American eked out just$12 million. That means it accounts for a measly 2 % of the profits of the three biggest U.S.

12:57airlines. And that's reflected in each company's stock price. Delta is worth$47 billion. United,$38 billion. But American is worth just$10 billion. In fact, American is worth less than Joby Aviation, which is an electric air taxi company with zero revenue. Toby, American is down bad and it needs to get its act together to compete in the major leagues. And it thinks free Wi-Fi is one place to start. Yeah, this is partially a messaging issue for American because I was reading some industry publications and they were saying that essentially there's nothing stopping American from telling the story that, hey, we are going to be on par with a lot of the amenities.

13:35that Delta and the competitors are offering right now, but it just hasn't done a very good job of telling that story at all. It also used to hang its hat on reliability and just the sheer scale of it, and they thought that's what customers wanted most of all out of their travel experiences. That has proved to be misguided because what they really want is nice seats and premium lounges and just something that makes the travel experience feel upscale, catering to these big spending customers. And also the issue is that American hasn't even been very reliable of late. If you go back to last year, they ranked ninth out of 10 US airlines for on-time arrivals.

14:11They ranked last in J.D. Power, North American airline satisfaction rating. So it wasn't even doing its bread and butter well. So now it's trying to say like, hey, we're gonna get on par. We're gonna offer these same amenities. There's nothing stopping us from being just as good as Delta if you'll only give us a chance. Well, I think a good example of this is the concept of seat back seats. So a few months ago, United Airlines did this whole who said we are going to add one hundred and forty six thousand seatback screens on seven hundred and sixty five of their jets. And what the chief commercial officer then said was a side swipe at at American said these screens are one way of defining a premium airline in the United States because American decided not to do that investment said, look, people are coming on to our planes with their iPads and their iPhones.

14:59and why would they need a screen? But it just seems like if you want to be a premium airline, then you have to have a seatback screen because it's just the overall vibe of luxury that you want to create that American has not been doing over the past 10 years as the airline industry has basically shifted entirely to serving the 1 % premium customers and let everyone else kind of fall by the wayside just because that's not where they're making their money. We've been pretty mean to America in this segment, so I do want to throw them a bone. And one operational change that they made last year that has proved dividends was increasing their boarding time by five minutes, essentially opening the gate earlier and telling people to arrive earlier.

15:39That reduced bottlenecks of passengers getting on board. That resulted in a 25 % drop in gate-checked bags dating back to May 1st of last year. So they are kind of saying we're trying to reduce the friction when it comes to traveling. And sometimes these very small tweaks like free Wi-Fi, like a five-minute extended boarding window, make all the difference in the long run. I'll say I was at Dallas-Fort Worth over break, and I've never seen more American planes in my life. And you said it was a bad experience. Yeah, Dallas-Fort Worth has one good terminal, and the rest are not so great. But, yeah, I was just shocked.

16:17Because here, and that's actually another big part of this story is that American has two huge hubs, Charlotte and Dallas, which serve sort of the interior of the United States and also have these international routes down to Latin America. But they don't have those big hubs on the coast, like in San Francisco or New York, which have these very lucrative routes to Europe and Asia, where all the airlines are making their money. And so while if you want to go from Dallas to Wichita, like American absolutely has you covered. But if you want to go from San Francisco to Sydney or New York to Switzerland, they are less, you know, they're a little less, you know, equipped to handle those routes.

16:54So, yeah, I was just shocked because I've just never been to the middle of the country with those huge American hubs. And the scale of this airline is massive. All right. We're going to take a quick break and come back with a story about Legos. Neil, my morning routine got a lot better just by checking my portfolio on public. Same. On public, you can build a multi-asset portfolio of stocks, bonds, options, crypto, and now generated assets, which allow you to turn any idea into an investable index with AI. From renewable energy companies with high free cash flow to semiconductor suppliers growing revenue 20 % year over year, you can literally type any prompt and put the AI to work.

17:36Then you can invest in a few clicks. Generated assets are like ETFs with infinite possibilities. Get started at public.com slash morningbrew and earn an uncapped 1 % bonus when you transfer your portfolio. That's public.com slash morningbrew, paid for by public investing, full disclosures in podcast description. All right, for this story, I want everyone to take a deep breath and reconnect with your inner child. If you're like me, you're back in front of your Lego set right now. Now I want you to imagine a new type of Lego brick, one with a fully self-contained computer brain inside that makes the brick light up and make noises.

18:14Well, you don't have to imagine it because Lego is rolling out what it's calling its first ever smart brick. And it is very excited about it. The company calls the smart brick the most significant evolution in the Lego system in play since the introduction of the Lego minifigure back in 1978. The computer inside the standard 2x4 brick can cause the piece to light up and make sounds. It has internal sensors that can detect movement, tilt, and gestures. It even has a microphone, not for recording, but used as a sensor input. For example, you could blow on the brick to trigger an action like the extinguishing of the light.

18:52The goal is to turn Legos from static sculptures that really hurts a step on to sets that come to life and make play a lot more interactive. If you're a Star Wars nerd, think lightsabers that hum, hyperdrives that light up, and blasters that go pew pew. Neil, you want Legos that go whoosh whoosh and pew pew? I know you want that. I mean, I'm trying to envision what this actually looks like, and it really is bringing, you know, when we played with Legos or any toys, you make those sound effects with yourself and, you know, go pew pew pew. I'm making my lightsaber sound right there. But it is interesting the way Lego is doing this because the toy industry shift to incorporate technology has had a lot of bumps.

19:35Before last year, we talked about this new AI teddy bear that was talking about sex and pills to kids. And there are all these other Internet connected toys that have been criticized. Mattel had this partnership with OpenAI. They were going to release AI connected toys together. But actually, they hit pause on that and said nothing's coming in 2026. Lego is doing this without AI, without screens, without being connected to the internet. It seems like this is a very thoughtful thing to infuse technology into their very analog bricks without sort of going overboard and drawing that balance. Which, you know, who knows?

20:12They don't even know if this is going to work and people will respond to it. But it seems like a fascinating idea. Yeah, it's really a dumb, smart brick. Like they are addressing these privacy concerns that other AI-enabled toys have run into. So I think you are right. It's very intentional that lighting up and making a sound is not necessarily the most revolutionary thing. For Lego, it is because they used to be very static. But you are totally right that they're trying to thread the needle here when it comes to connected toys. Some of the use cases, though, have drawn some criticism because the point that you started with, that we used to make these sounds with our mouths as we were playing with it, some are like you're taking away from children's creativity, their curiosity, their ability to put their own say over their play environments.

20:56Now you're going to say that the bricks itself are making the sound, so there has been a little bit of pushback from that. But some of the use cases are really freaking cool. The one that I love is that they form a Bluetooth mesh network, so that means that they can detect their position in relation to other smart bricks. So you can track winning vehicles in a race. Like if you sent the smart brick enabled cars across the finish line, you could see which car won, which would solve a lot of arguments amongst siblings. Like, no, my car got there first. They actually have like photo finishing technology, which I think would just be really fun if you were growing up playing with Legos.

21:34And it might be a way to assuage another criticism of Lego, which is that it's relying too much on these very elaborate sets for adults. and this would be a way to say, hey, we're still for the kids because I don't know if you've seen how much LEGO sets cost lately and how many pieces they have, but the most expensive LEGO set now retails for about$1 ,000. It's a collector series of the Death Star. It has thousands of pieces. And then according to BrickTap, which is a LEGO publication, LEGO is about to release a new Lord of the Rings set this summer. It's going to be priced between$600 and$650.

22:12It's going to have 8 ,278 pieces, and it's minus tier from the Lord of the Rings. These are things that you don't, these are for adults. You don't play with them. You build them, and then you put it on your shelf in order to show off to all your adult and other millennial friends that are like, hey, I still do Lego. So maybe this is Lego saying, we hear you. We're not just for adults. But obviously they say, if this goes well with kids, we're absolutely going with adults because that is the biggest trend in the toy industry. All right, let's sprint to the finish with some final headlines. Meta has a problem on their hands.

22:44People like their AI smart glasses a little too much. Plans to launch the popular glasses abroad in places like Canada and Europe this year are now on hold because Meta simply doesn't have enough inventory to satisfy the domestic market. Remember, these are a collab with the parent company behind Oakley and Ray-Bans, so they look like normal stylish frames, but they can take photos and videos and connect to an AI assistant. As a bet of purchase further into AI wearables, it's hard to imagine a better signal of demand than running out of supply. Up next, have you ever been into a McRib and thought to yourself, hey, wait a second, that's not a rib.

23:23Some folks are trying to do something about it. A lawsuit filed last month is accusing McDonald's of misleading customers when it comes to its McRib, the popular sandwich that arrives to great fanfare when it pops up on menus for limited time runs. In a suit seeking class action status, Plaintiffs allege that McDonald's named its McRib as a, quote, deliberate sleight of hand that knowingly deceives reasonable customers who reasonably, but mistakenly believe, that a product named the McRib would include at least some meaningful quality of actual pork rib meat, which commands a premium price on the market.

23:55McDonald's has responded that it does nothing of the sort, claiming that its McRib has a base of 100 % seasoned boneless pork with none of the lower quality meats, the lawsuit suggests. This lawsuit distorts the facts and many of the claims are inaccurate, the company said. Personally, don't think I can weigh in until I've had one. By the way, the lower quality meats that the lawsuits say is in the McRiv, it's going to ruin your appetite. Wait, so you're going to say it? I'm going to say it. Okay, make sure you don't have a bowl of food in front of you. They are alleging that it contains products like heart tripe, which I thought was a fish.

24:31It's actually intestinal lining and scalded stomach formed into a rib shaped patty. Yeah, no wonder McDonald's is trying to push back. I guess the mixed scalded stomach doesn't have as good of a ring as the McRib does. Finally, ESPN compiled a list of the best gambling wins of the year across various sports books in case you wanted to feel even worse about your performance this year. The year started off hot when a DraftKings bettor put together a 19-leg college basketball parlay on January 9th. That was$43 ,473 ,946 to one long shot. Of course it hit, and of course they only put 50 cents on it.