Inflation Gets Hotter & Airbnb Bans Surveillance Cameras

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0:28Good Morning Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, Airbnb is banning the use of indoor cameras in its rentals. Wait, Airbnb allowed indoor cameras? Then Google's swanky new office is beautiful and environmentally friendly, but it forgot one major part of a good workplace, Wi-Fi that works. It's Wednesday, March 13th. Let's ride.

0:57It is official. After more primaries last night, President Biden and former President Trump clinched their party's presidential nominations, setting up a rematch in the general election. But that is not the election story everyone was talking about yesterday. Robert F. Kennedy Jr. is making an independent bid for the White House. And the New York Times reported that New York Jets quarterback Aaron Rodgers and the former Minnesota governor and professional wrestler Jesse The Body Ventura are at the top of his shortlist for VP. He's approached these two about the possibility of joining him as a running mate, and both have reportedly welcomed the overtures.

1:36Toby, can you be a QB and a VP at the same time? God, can you imagine if Aaron Rodgers ends up as VP? I'm trying to think about which job mix up would come at a more inopportune time. If he accidentally drops a play call while addressing the nation or if he drops classified national secrets while in the huddle, I think the Jets would be more upset, honestly, because the Jets only have a few amount of plays that actually work. And if he drops one on national television. But yeah, man, this is setting up for you just got to hope it happens in some alternate timeline. I mean, Jets fans are like, oh, man, we lost this guy a couple of minutes into the game.

2:12to injury last season, and now we're losing him to the White House. We can't catch a break here. Jets can't win. Let's hear a quick word from our friends over at Factor. I want to dig into what you experienced the first time you receive Factor. First, you get this big box at your door that makes it feel like Christmas morning. The box is the best. All your neighbors get jealous. You can't overlook that part. Oh, jealous neighbors is a key aspect of the Factor experience. Once you bring the box inside and open it, you are greeted by stacks on stacks of the most beautiful chef-prepared meals you've ever seen.

2:46Okay, but the best aspect of the whole experience is sliding the cover off a meal, never frozen, by the way, and poking the holes in the plastic film before you toss it in the microwave. Yes, it is such a stress reliever, honestly, just going to town on that film. Then, of course, eating the meal is absolutely delightful as well. So I know I've called literally everything about this experience my favorite part, but my actual favorite part is the no cleanup. Such a time saver. Let's be realistic here. Three minutes from Box of Belly with no mess. You really can't beat that. Now, if that got your stomach rumbling, head to factormeals.com slash morningbrew.

3:20Then use code morningbrew50 to get 50 % off. Does it ever feel like you're a marketing professional just speaking into the void? But with LinkedIn ads, you can know you're reaching the right decision makers, a network of 130 million of them, in fact. You can even target buyers by job title, industry, company, seniority, skills, and did I say job title? See how you can avoid the void and reach the right buyers with LinkedIn ads. Spend$250 on your first campaign and get a free$250 credit for the next one. Get started at linkedin.com slash campaign. Terms and conditions apply. The latest Consumer Price Index report dropped yesterday, and it made clear that inflation is taking longer to wrap up than the last minute of a college basketball game.

4:03Consumer prices in the U.S. rose 3.2 percent in February from a year earlier, slightly higher than expectations. As the second straight month that inflation rose more than predicted, it shows how the so-called last mile of bringing inflation back to normal levels is proving to be the hardest. Still, despite the disappointing numbers, stocks rose on the day and the S &P 500 hit a new closing high. Well, what's up with that? Well, it all comes back to the Federal Reserve and what it plans to do with interest rates. The Fed does not want to lower interest rates before the economy shows consistent signs of cooling, because a rate cut, which is intended to juice the economy, could send inflation back up again.

4:42And though February's inflation numbers were relatively hot, they were not concerning enough to change the Fed's calculus on cutting rates, which is why you saw relative calm on Wall Street. Yeah, it wasn't a big sirens wailing type of day, but you never do want to see inflation come in two months in a row a little hotter than expected. The big contributors were, again, kind of the boogeyman over the past few years, honestly, which were housing costs as well as energy costs. Costs for housing, gasoline, were up. Those categories contributed to over 60 % of the overall month-to-month increase. Energy index rose 2.3 % month over month as gas prices kind of nudged up again.

5:22And then housing was a major factor again, climbing 0.5 % month over month. But again, there isn't panic button being hit. The first line of the Wall Street Journal's article covering this was US inflation was slightly stronger than expected, but it did little to change expectations that the Federal Reserve will begin cutting rates later this year. That was the general message that we were hearing yesterday. Totally. And one good piece of good news. This has been a category that everyone has been watching very closely. Food prices and is in a very hopeful sign. Food prices were flat month over month.

5:56They had been increasing at a kind of an alarming rate over the past few months. They had leveled off and are now flat. President Biden had targeted grocery stores and retail companies for shrink flation and jacking up prices to gouge consumers that appeared to have leveled off last month. Another piece of contextualizing info I want to provide is that you always hear about the 2 % inflation number that the Fed is always targeting. Remember, the Fed doesn't actually use the Consumer Price Index as its preferred primary inflation gauge. That comes from the Labor Department. The Fed's goal is actually measured against a separate gauge that is maintained by the Commerce Department.

6:32It's called the Personal Consumption Expenditures Index, or the PCE. It tends to run a little bit cooler than the CPI that the Labor Department relies on. So that will be released March 29th. We'll get February's data at the end of March, actually. So when we hear about that 2 % number, the Fed is actually eyeing that PCE index rather than this CPI index. So what should you know about what's coming up and what the Fed is going to do? Well, the Fed has a meeting next week. It's expected to hold interest rates steady as it has for the past several meetings. The big question is how many rate cuts does it pencil in for the rest of 2024?

7:10It's either going to be two or three. Three would mean that probably in June the Fed would start cutting rates. So definitely not going to be next meeting, probably not going to be in May either at the meeting after that. But by June, if everything holds steady as it has been, it appears that the Fed will begin cutting rates by June, by the summer. And we'll be here to tell you all about it then. So stick around. Let's move on. Every once in a while, you come across a company that is just a lot bigger than you'd expect. And I'd slide the messaging app Telegram squarely into that category. According to a Financial Times profile of the company, it surpassed 900 million users, is nearing profitability, and is potentially gearing up for an IPO.

7:53It made a name for itself early on as a secure messaging platform, which started as a haven for the typically authority-averse crypto community before morphing into a more crucial communication tool for everyone from global government officials to citizens in conflict zones due to its light moderation and emphasis on privacy. But those same features that make it valuable to citizens living under oppressive conditions also make it appealing to bad actors. Some cybersecurity experts describe it as social media for criminals due to its lack of moderation and proliferation of channels peddling everything from drugs to weapons.

8:30Neil, this is a company geared towards secrecy. The only way we got any of these figures is because its Russian founder, 39-year-old Pavel Durov, gave his first interview in seven years. What do you make of this under-the-radar behemoth? What a fascinating company. First interview in seven years. We finally get some information. What I make of it is that it is big. It has nearly three times the number of users of Twitter, about half of all WhatsApp users. There's 1.8 billion WhatsApp users. Signal, only another rival messaging app, only has 30 million users. So my first impressions are, damn, this company is really big.

9:09Pavel also told the Financial Times that they're bringing in hundreds of millions of dollars in ad revenue as they've started to build out an ad business. They also have a premium subscription. So I'm just thinking, wow, this is a huge company that's kind of flying under the radar, at least here in the U.S., because we have so many other big messaging apps and the big tech kind of sucks all the oxygen about it. But if you're looking at a global view, Telegram is so influential and it is gearing up potentially for an IPO in the U.S. It's going to have to change a lot of its business practices to make that happen.

9:39Yeah, this app has just been growing like a weed. It's in 2021, Telegram said it had around 500 million users. Now it's 900 million users, so it's almost doubled in that time period. Also, for a company of that size, it is incredibly small. Telegram only has 50 or so full-time staff and only 30 or so engineers, which I think big tech right now is, they literally can't even, they're like, where's the product managers? Where's everyone who needs to approve everything? 50 people at the entire company of this size is just kind of insane. Right. Well, it all ties back to this guy, Pavel Durov, who's the founder and the CEO.

10:21He likes to call himself the product manager instead of the CEO. Very fascinating person who lives in exile in Dubai, where this company is set up, because he refused to—he founded a previous social media company that was big, but he refused to share information on Ukrainian users with the Kremlin, and so therefore he got sent into exile. So he is a very fascinating character. He dresses in all black all the time, very minimalist. He's called the Mark Zuckerberg of Russia. He wakes up every morning, does 200 pushups, 100 sit-ups before an ice bath. He is kind of the quintessential mysterious tech founder.

10:57And he owns 100 % of the company. He's never raised any equity financing. He's only done debt financing up until this point. So this IPO that he's kind of framing as a way to, it's kind of a Reddit-y drum that he's beating right now is that he wants to share the profits of Telegram with the community. He was also considering doing something in the IPO like Red is doing, which is granting shares to its power users. But again, you're sitting there owning 100 % of this company that probably is in that$30 billion. He said he's received offers of$30 billion or so for the company so far, and that you own 100 % of it.

11:33It's not a typical scenario you see in today's venture capitalist environment. Yeah, but to IPO in the US, he's going to have to clean up the platform, which, as you said is rife with criminal activity. Moving on, in its biggest effort yet to reduce the creep factor on its platform, this week Airbnb said it's banning the use of indoor security cameras in its listings worldwide. The policy, which goes into effect on April 30th, expands on existing restrictions that only permitted the use of cameras in common areas like hallways and living rooms and only when the guest consents to it. The company said that the vast majority of its 7.7 million global listings do not have indoor security cameras, but it was enacting a full van anyway to, quote, create new, clear rules that provide our community with greater clarity about what to expect on Airbnb.

12:22For what it's worth, competitor VRBO has prohibited indoor cameras and rentals since 2022 and said it welcomed the move from its rival. It wasn't clear if any particular incident sparked Airbnb's shift in policy, but numerous horror stories have have cropped up over the years of guests finding hidden cameras that appeared to be hosts spying on them. I think this was a step that Airbnb had to take because you're right. It's not any specific instances, but when those instances leak, it is just such a bad look for the company in general. I do think this is a fine line that Airbnb is walking right now, because how do you balance the wants of the hosts and the wants and needs of the guests?

12:59Because hosts sometimes do want cameras in their property. They want to protect from parties or people doing something illegal inside their properties and so cameras are an aspect to that but not any if you not cameras hidden in the smoke right obviously anything that is hidden is something that makes guests feel really unsafe so you do definitely want to balance these two uh conflicting kind of desires and you probably want to skew towards making the guests feel as safe and as comfortable i think so especially considering that the vast majority of its listings do not have security cameras but there's also been this cottage industry that's grown up on TikTok and other social media platforms teaching guests how to look for hidden cameras.

13:43What you want to do is shine a flashlight actually around the space because that'll detect the lens of a particular camera that may be hidden. That's one way you can do it. There has been that cottage industry rising, but then there's also been some like false alarms that have come up as well where people are dismantling smoke alarms and they don't really know what they're looking for. They just see wires and they're like, oh my gosh, I'm being spied on. So probably the right move for Airbnb in general. And you always like to see like these platforms taking steps to make guests feel more comfortable.

14:10Up next, stick around because we've got a report about the software in your car that you're definitely going to want to hear. Eczema isn't always obvious, but it's real. And so is the relief from EPCLIS. After an initial dosing phase, about four in 10 people taking EPCLIS achieved 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.

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15:19Tonight on NBC, Jimmy Fallon and Bozema 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 tonight on NBC. Turns out those snazzy systems in new cars that buzz your seat when you stray out of your lane or help you pilot your car are not all that safe.

15:59That was the main takeaway from a study by the Insurance Institute for Highway Safety, an independent group that evaluates new cars after it tested out 14 different partially automated driving systems. The organization rated 11 as poor, two as marginal, and only one as acceptable. So congrats to Lexus's advanced drive system for your acceptable grade. But what the heck is going on with the other 13 from brands like GM, Nissan, and yes, Tesla. The infractions were numerous and varied, but overall a main sticking point was that most of the software is bad at monitoring driver attention, which is still an integral part of ensuring these partially automated systems are safe.

16:39Neil, this is a weird niche in the auto software game because these aren't full self-driving systems, but a lot of people kind of consider them to be. Right, it's kind of evolved over the last decade where these car makers introduced things like lane departure warnings, lane centering, blind spot detection. And those kind of grew a little bit to become more robust. And now there are certain systems that allow you to take your hands off the wheel completely. And there is no federal regulation in place around these partially assisted systems. And this group was like, IIHS was like, well, maybe someone should start checking on whether these things are OK and safe or not.

17:19And it's very muscular. People really pay attention to this particular agency's report, and it does incite change in automakers. So this is not just a random magazine doing a little test. They enact change in many other areas, and I think automakers will update their software in response to this report. Right. I think the general drumbeat among auto execs recently is that these features make cars safer. And, of course, consumers want to hear that. They want systems in place that they think allow them to be a little more distracted when they're driving. But that is a double-edged sword, a two-sided coin, if you will, because, again, you should still be paying attention while you're on the road.

17:59These systems do things like prevent you from going out of your lane, but they are not going to drive the car for you or they shouldn't drive the car for you, even though a lot of people rely on them to do just that. Yeah, there's been really interesting research from UC Davis Institute of Transportation Studies, which shows that people actually like partially assisted driving features. And it makes it makes the whole experience less terrible. And they actually drive more with using those features than you wouldn't. They did a survey of 630 Tesla owners. They found that drivers who use partial automation, Tesla's autopilot, drive on average nearly 5000 more miles per year than similar owners without the feature.

18:38So drivers are responding well to this. But this report shows that automakers aren't necessarily doing a good enough job of monitoring the drivers, making sure they're paying attention when they really should be kind of looking at the road. Some of the ways that they tested these systems were very funny. There was one where they were trying to simulate a driver's hands on the wheel and they just were strapping kind of ankle weights to a steering wheel. And that was fooling like the Tesla autopilot systems. Another way is they put a cheesecloth over the driver's head while they were driving, and which, again, should indicate a distracted driver if you literally can't even see the eyes or the face.

19:13But these systems weren't notifying the driver that, like, hey, return your attention to the road. So that's kind of the main thing that the institute was trying to push, is that there needs to be better alert systems that alert you when you are being distracted and to return your focus to where it matters most. Moving on, has this happened to you? You make a reservation at a restaurant, something comes up last minute and you have to cancel. But the next day you see a$50 fee in your credit card account for not showing up. This is actually a thing now, according to a New York Times report. An increasing number of restaurants are tacking on cancellation feeds to dissuade people from being flakes and actually following through on their reservation.

19:5317 % of U.S. restaurants on Resi charged at least one cancellation fee in January, up from 13 % a year earlier and just 4 % in January 2019. And for restaurants in big cities, the practice is even more common. 25 % of New York restaurants charged at least one cancellation fee in January, and so did 20 % of restaurants in L.A. and Miami. You may grumble about it, but restaurants, especially those that rely on their reservation book, say that no-show diners can majorly disrupt their careful planning for any given night. And hey, if airlines and doctors have a cancellation fee, why can't they? Yeah, it is just a delicate balance here because there's sort of game theory at play on finding how much you should charge people because too low and then diner behavior essentially remains the same.

20:40Like if it's only a$5 fee, you wouldn't feel bad about canceling that reservation without notifying them. Too high though, and then reservations start to drop off. So a lot of these restaurants say kind of that$25 to$35 fee is the thing that makes diners pause and take an extra step to say, like, hey, I am canceling here. So I do love the kind of game theory aspect to this. It does work, which is not surprising, I guess, if you have to throw down some money. But this one restaurant in New York City called Chino Grande began charging$20 per person for missed reservations in 2022. Since then, no-shows have dropped 90%.

21:15So when you lay down some money on the table, you're going to show up for your reservation. The other aspect of this, too, though, that maybe you don't consider in the short term, but will affect you in the long term, is that if you charge too high a fee, people might leave those one star reviews. And those are a lot. Those stick around a lot longer than maybe the extra money that you made in the short term from for getting people to show up to the reservation. So that is the fine line that you're walking, is that if the one star review comes, that is not good for you. No, you should. Yeah. And if somebody is angry with you, there have been instances where they say, OK, here's a gift card.

21:48We're sorry. Or just be lenient. If someone has an emergency and they call you and some restaurants do this, they say, OK, if you at least contacted us, we can make changes. But they just run such a tight ship for especially, you know, higher ed restaurants that require reservations all the way through the night. They can't have an empty table for even five minutes or they're losing money. So it's really important for them to keep turning over tables, know exactly who's coming so you can understand why this is important to them, particularly in the restaurant business. Are you a show up on time to the minute reservation guy or do you know how they give you a 10 minute window?

22:20Some people say like, oh, it's 10 minutes, 15 minutes. We can show up at the end of that window. But I try to because I'm usually hungry. No, me too. I hate when people do that. So that's good to know that you're punctual as well. Let's let's wrap up the show today with an extra large helping of poetic irony. Google's expensive self-designed Bayview office was described as a technologically advanced canvas of creating new ways to be together when it opened in 2022. Well, it turns out Google architects forgot one thing to make sure that the Wi-Fi works. Apparently, it's nearly impossible to get a good Wi-Fi connection in some parts of the uniquely designed structure.

23:00The best way I can describe this office is it kind of looks like a circus tent with sweeping canvas stretched across poles, except for the sections of canvas are obviously made of metal and glass. It looks cool. I'll give them that. But the parabolic nature of the ceilings just aren't conducive to Wi-Fi propagation, according to a Reuters report. Neil, there is something so incredibly poetic about one of the companies that is associated with the rise of the very Internet itself not having great Internet access at their office. Apparently, this thing swallows broadband like the Bermuda Triangle.

23:34It is terrible for Wi-Fi propagation. And you see these reports of Google employees working on the most advanced AI systems, having to plug into Ethernet cables. They have to hotspot. They have to work in cafes outside because the Wi-Fi stinks. And maybe this is emblematic of Google's broader problems because these employees who are working there, at least some of them, are working on Gemini, are working on artificial intelligence. and they can't load Gmail because of the Wi-Fi sucks. So this is maybe emblematic of broader problems at Google, overlooking the simple things. Yeah, it is ironic all the way down, no matter how you look at it.

24:10It's also not great because Google is trying to push its workers to return to office three days a week. They're trying to get people fired up to be back in person again. But if you have this headache, there's nothing worse than going to work and not having the Wi-Fi work. Even if the Wi-Fi around here slows down even a little bit, There's a riot. There's a full riot. So I can't even imagine what it'd be like to work at Google and have to work off your phone's hotspot. Just ridiculous. All right. We have to wrap it up there. Have a wonderful Wednesday. Pi Day tomorrow. Toby, you've been memorizing the 100 digits?