Is Tiktok For Sale?! & Blockbusters Dominate the Oscars

0:03When did making plans get this complicated? It's time to streamline with WhatsApp, the secure messaging app that brings the whole group together. Use polls to settle dinner plans. Send event invites and pin messages so no one forgets mom's 60th. And never miss a meme or milestone. All protected with end-to-end encryption. It's time for WhatsApp. Message privately with everyone. Learn more at whatsapp.com. Good morning, Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, Al Pacino is the king of brevity and other takeaways from a big Oscars night. Then let's take a trip down memory lane because believe it or not, it's been one year since Silicon Valley Bank imploded.

0:45It's Monday, March 11th. Let's ride.

0:54If you're feeling a bit groggier than usual this morning, it's because early on Sunday, the U.S. entered daylight saving time, which springs forward the clock so we all get more daylight in the evenings throughout the summer. Of course, that meant losing an hour of sleep Saturday night into Sunday, but that's the tradeoff you make so you can nab 6 p.m. tea times. Toby, this is one of the most contentious debates in modern society, in or out on Daylight Savings. Man, it is tough every year. I think I'm back in on Daylight Savings time. One, for the business reasons. Obviously, more people go out in the evenings, which is great for retail restaurants, and we're pro-business here at Morning Brew Daily.

1:31Also, as you mentioned, Massly helps the golf industry out, leading to more afternoon tea time. So, of course, I'm for that. But you know what's crazy? I was just thinking about this before the pod. Kids today won't know the struggles of having to go around and manually change the microwave clock, the oven clock, because all the appliances are smart these days. They're connected to the internet already. So maybe I'm out because I'm an old man shaking my fist at the cloud right now. Well, my oven clock has not changed. and I haven't changed it an hour forward yet. And so I'm thinking, how long do you wait until you just say to hell with it and wait for November until it'll be accurate again?

2:09Like what's the statute of limitations? I think honestly, this is a big day for lazy people or a bad day for lazy people because then it's gonna be a few more months until their broken clock is right once again. All right, let's hear a word from our friends over at Factor. I want to bring to attention a new malaise I've recently experienced called post-factor sadness. It's the moment when you open your fridge and realize you have no more Factor meals left. I too have felt the cruel sting of PFS. There's nothing worse than having to rely on your own chefing skills after a week of standing on the shoulders of Factor's team of culinary giants.

2:45It's not just the taste that I miss though, it's the convenience. Having to cook a meal after recording this show, working a full day, prepping for tomorrow's show, it makes you really appreciate Factor's convenience. Toby, you're giving me secondhand PFS. Let's give people the URL so they can experience some PFE, pre-factor excitement. Oh, I like that. Head to Factormeals.com slash MorningBrew50, then use code MorningBrew50 to get 50 % off. That's Factormeals.com slash MorningBrew50 with code MorningBrew50 to snag that discount. This episode is brought to you by State Farm. Checking off the boxes on your to-do list is a great feeling.

3:26And when it comes to checking off coverage, a State Farm agent can help you choose an option that's right for you. Whether you prefer talking in person, on the phone, or using the award-winning app, it's nice knowing you have help finding coverage that best fits your needs. Like a good neighbor, State Farm is there. So, before the weekend, you may have heard us talking about a surprise resurrection of the effort to ban TikTok. A key House committee voted 50 to nothing in support of a new bill that would force its Chinese owner ByteDance to relinquish control of the app or else face a ban in the U.S.

4:01And over the weekend, we got some new information on how Washington is really feeling about this latest effort. President Biden has come out and said he would support a bill banning TikTok if Congress passed it. And a full House vote is coming this Wednesday. So in other words, this bill isn't just for show. It has a real chance of becoming a law. Meanwhile, his presumptive opponent, Trump, posted on True Social that he would not support a TikTok ban because it would hand too much power to Mark Zuckerberg and Meta if you got rid of its competitor. That, of course, is a full 180 from his stance in office when he was very much for a TikTok ban.

4:38Neil, this ban certainly feels a lot more legit than some other efforts we've seen in the past. It does, and lawmakers would say it's not a ban. And we just want to force ByteDance to relinquish control because they could be beholden to the Chinese government and steal Americans' data and influence American policy through their social media app. But what really is interesting to me is, if this comes to pass, huge if, who would buy TikTok if ByteDance would relinquish control? If you look at the big tech companies, they're probably not going to be able to buy it because they can't buy a$1 billion or$2 billion company over antitrust concerns.

5:12TikTok is probably worth in the hundreds of billions. So that eliminates Facebook, Google, all the other big tech companies. One person who does appear to be trying to cobble together a bunch of really wealthy individuals is Bobby Kotick. This is reported by The Wall Street Journal. He's the former CEO of Activision Blizzard. And at a conference last week, he was floating the idea of saying, hey, you want to buy TikTok? Who is at that table? Sam Altman, CEO of OpenAI. Mr. Wonderful of Shark Tank fame also posted on social media that he'd love to buy TikTok because it is a tremendous advertising business.

5:46So many businesses do run on TikTok. I don't think Mr. Wonderful is going to buy TikTok. He doesn't have that kind of money. Sorry, Mr. Wonderful. But it does sort of show the appetite for buying the social media platform will be huge. You got to respect the hustle of Mr. Wonderful just tossing his hat in the ring. And then, of course, somehow Sam Altman is wrapped into all of this as well, because, again, TikTok has a very robust AI underpinning algorithm that is kind of makes it what it is today. The big question here, though, is this bill just grandstanding? Because again, we have talked about a potential TikTok ban for so long right now.

6:23And the constitutional law here is relatively straightforward, is that Congress cannot outright ban TikTok or any other social media platform by that means, unless it can prove it has a serious privacy or national security threat to America. Because again, what America is very, very, it's founded on, it's protected under the First Amendment rights. And so you don't want the government going around banning places where free speech can happen. So that aspect of it is relatively straightforward. They just have to prove that it is a threat to national security risk. So if it goes through, though, TikTok does still have outs.

7:02First, it may not even pass through the House or the Senate, who's already expressed some opposition to it. But even if it does pass and it gets signed by Biden, TikTok could then challenge the legality of it, arguing that it violates the First Amendment rights. We've seen this kind of play out in Montana, which banned the app last year. But then a federal judge blocked that measure, citing free speech concerns. So that's kind of a general rundown of how likely it is that the bill passes and then what outs TikTok has if it does pass. Let's talk about Trump just finally here. So Trump, as you mentioned, wanted to ban the app a few years ago when he was in office.

7:36Now he is against a ban. There is a particular bit of intrigue here because a billionaire conservative donor who Trump just made up with and met last week named Jeff Yass is a huge investor in ByteDance. He has a$33 billion stake. So you can maybe put the two and two together with Trump's financial woes. Yass has threatened to withhold donations from any Republican lawmaker who proposes banning TikTok for obvious reasons. And it's such an awkward moment for the Biden administration, too, because they are literally campaigning on TikTok right now while also saying they'd support a band. So it's a very muddled field in Washington right now when it comes to TikTok.

8:16Moving on. In an Oscars ceremony where the only thing stripped down was John Cena, the big movie won the biggest prize. Oppenheimer, Christopher Nolan's epic about the creation of the atomic bomb, won Best Picture, while Nolan nabbed his first Academy Award, which is crazy, for Best Director. Overall, Oppenheimer won the most awards of any movie with seven. Oppenheimer seemed inevitable to dominate, but in doing so, it really bucked the trend. While low-budget indie flicks have dominated the best picture category for the past decade, Oppenheimer proved to be a critical and commercial success. With a nearly$1 billion haul at the box office, the movie was the highest-grossing best picture winner since The Lord of the Rings' The Return of the King all the way back in 2003.

9:01Overall, the Academy Awards were a reflection of Hollywood's topsy-turvy year. There were remarkable highs like the Barbenheimer phenomenon last summer, and there were extreme lows when actors and writers went on strike for six months to negotiate a better contract. Host Jimmy Kimmel mentioned the strike in his monologue, reminding the audience that L.A. was a union town and invited crew members working on the telecast to come onto the stage and get some applause. Toby, what were your takeaways from the show? People seem to have very positive reviews of it. Yeah, it was definitely a positive experience.

9:31I enjoyed watching it. I thought Kimmel kind of stuck the landing. This has always been my thing. Let's have people whose job is to host stuff end up hosting stuff. They just do a good job. Get out of the way when necessary. One of my big highlights, too, is my favorite movie the past year was Godzilla Minus One. That team won for best visual effects, which I was really happy to see. They all brought their Godzilla kind of toys to the show. Also, they're all wearing Godzilla-themed footwear. So very cute. I really enjoyed that. And it was the first Oscar ever in the Godzilla franchise history of 70 years.

10:06So justice for Godzilla. Yeah, justice for Godzilla as well. Barbenheimer really wasn't a rivalry at the actual award show, which a lot of people probably expected. I mean, Barbie won at the box office. It won best song. Billie Eilish won. Ryan Gosling's performance of I'm Just Ken was fantastic. But Oppenheimer literally won everything else. So that rivalry never really came out to play. Yeah. Also, just the world's wars were top of mind during this show. One particularly moving moment was the director of 20 Days in Mariupol. They won for Best Documentary Feature. He said, I wish I'd never made this film, which was about Russia's attack on the Ukrainian city.

10:44I've heard this movie is amazing. I really want to see it. Also, in his acceptance speech for Best International Feature, the Zone of Interest director Jonathan Glazer. This movie was about the Holocaust and a home right outside Auschwitz. He lamented the dehumanization of victims in the current Israel-Gaza conflict. So as always, the Oscars sort of reflected and represented all that's going on outside the world of movies as well. All right, let's move on. Sometimes it's fun to look back on where you were a year ago, see how much you've grown and all that. But for Neil and I, time is a bit of a flat circle because a year ago we were in this very studio talking about this very same topic, the collapse of Silicon Valley Bank.

11:23The events of last March kicked off the most significant banking crisis in the country since 2008. But what has changed now that the dust has settled? Paradoxically, both really big banks and really small banks have come out on top. Small neobanks like Brex and Mercury experienced a huge inflow of customer deposits in the wake of SVB's meltdown. Brex more than doubled its customer deposits to$7 billion, while more than 8 ,700 new customers brought in$2 billion in deposits to Mercury in the five days following the collapse. On the other end of the spectrum, big banks are bigger than ever. First Citizens ended up acquiring SVB's assets while Chase swooped in to scoop up First Republic after it also failed.

12:07And despite their heftier size, heftier regulations have not been quick to follow. So, Neil, even though we're sitting here one year later, with a banking system that is different, it doesn't look dramatically different on a regulatory front. No, it doesn't, which is surprising because, I mean, this was a huge collapse. We kind of forget, but three banks went down in the matter of a few weeks. Together, those three banks were larger than the 25 that failed during the 2008 financial crisis. It just didn't manage to ripple out beyond those particular banks. think regulators acted pretty quickly, and they would be the first to blame themselves for missing the warning signs for SVB and others.

12:46I think there's a lot we learned, but one of them is just that if you act quickly, the FDIC worked quickly to insure all the uninsured deposits, any deposits over$250 ,000, they made those depositors whole. If you act quickly, you can stem a banking crisis, and you can nip it in the bud. But yeah. Yeah, it's been interesting, though, because it was a weird kind of regulatory response to what happened, because a few months after SVB collapsed, the Federal Reserve did propose a series of major changes around how these big lenders are regulated. But those were actually not specifically in reaction to SVB's collapse as much as it were.

13:23They're called the base three endgame regulations. And they actually are. Oh, Basel. Thank you for saying that. Basel three endgame. And they were a reaction as much to the 2008 financial crisis as it was to SVB itself. And those reforms were kind of targeted at raising some of the capital levels, increasing some of the risk thresholds that these banks have to undergo. But then just this past week, Jerome Powell told Washington lawmakers that despite those regulations that were released in the wake of SVB, there's still big and material changes that are coming to them. So, it has been slow going to see any real changes on the regulatory front.

14:02And the question now is, could this happen again? Jamie Dimon, in a closed-door meeting last week, said, if rates go up and there's a major recession, you're going to have exactly the same problem with a different set of banks. And remember, high interest rates was what took down SVB along with a bank run. Right now, the most immediate risk-facing banks appears to be commercial real estate. A New York community Bancorp had to receive a$1 billion lifeline from Steve Mnuchin and others as it's teetering because it loaned out to commercial buildings and residential buildings. And those are plummeted in value.

14:42These transactions haven't really come through yet. But when they do, we're going to see huge cuts in value that could make these loans pretty sour. I think that is the next threat that people are looking at in the banking sector. Okay, up next we have an Electric Winners of the Weekend segment where we're talking potential Tesla killers and UFOs.

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16:02All right, let's hit our winners of the weekend where Toby and I share two things that were not affected by the time change. Toby, you won the pre-show stone skipping contest, so I tip my hat to you and you get to go first. my winner of the weekend is the ev maker rivian with tesla byd even fisker gobbling up headlines good and bad rivian has kind of gone under the radar recently on the ev front but just before the weekend it unveiled its new sporty and affordable suv and suddenly everyone is talking about rivian now the new r2 it unveiled has an estimated range of 300 miles goes zero to 60 in three seconds and starts at just$45 ,000, not including the$7 ,500 federal EV tax credit that it will likely qualify for.

16:47But what really got people revved up is that Rivian pulled a Steve Jobs and had a one more thing moment to show at the end of their event. That one more thing was the Rivian R3, which is a smaller, even more sporty SUV with a very cool retro futuristic stick silhouette. Everywhere I looked, Rivian was getting a lot of love all weekend. And apparently, it's already booked 68 ,000 reservations for the R2. Yeah, I mean, this is a huge deal because there's nothing on the market right now in the EV space that's$45 ,000. And this type of SUV is very popular, whether hybrid, EV, or internal combustion engine.

17:25Experts said this increased the total addressable market for Rivian from$500 ,000 to$700 ,000 to$8 million to$10 million. So it opens up so much more possibilities for Rivian. There's a lot of buzz around this. But we should say Rivian is in a world of financial trouble. It loses$43 ,000 per vehicle and racked up over$5 billion in losses last year. So who knows whether it'll even live to see the day when the R2 and R3 come on board. But if it can cut costs and get more sales of its R1 vehicle and it can sort of buy some time to get to the R2 and R3, it seems like there's pretty heavy demand for it.

18:03Yeah. Rivian absolutely still has its work cut out for them on the production front. The R2 is expected to start production in the first half of 2026. The R3 might go into production sometime in 2027. Those are big ifs and mights right there. And one of the big reasons for that is that it just recently put its big Georgia factory expansion plan on pause. It was supposed to build this massive$5 billion facility east of Atlanta, but they had to pause that because of some of those cash flow issues. So the existing plant that is in Illinois will have to ramp up in order to support this new production of these new vehicles.

18:39So you're totally right. Even though it looks really cool, it was getting a lot of love on Twitter for its cool design elements. The production question marks are still the biggest thing. And what the Rivian CEO was saying about the overall EV market, I thought was pretty interesting because right now we're definitely in the trough of disillusionment where growth is not coming as expected. But he said this, you know, the world is electrifying. Eventually we'll get there. So I'm betting I'm betting everything on EVs. My winners are people who think UFOs haven't visited Earth because in a major report released last week, the Defense Department said that UFOs haven't visited Earth.

19:14In its investigation, the Pentagon looked at all reports of UFOs, or as they're known in government terms, UAPs, since 1945 until the present, and found no evidence that the government was covering up knowledge of ETs having dropped by our planet, and concluded that reports of UFOs were either ordinary objects or the result of misidentification. There's just a lot of weird stuff whizzing around in the air these days, from errant weather balloons to satellites to drones. Of course, for people who believe the government is covering up evidence of UFOs, the government saying there are no UFOs is not likely to give them much confidence.

19:50Last year, a former U.S. intelligence officer testified that the government found aliens, has stashed away their corpses, and tried to reverse engineer their technology. And in its report, the Pentagon said that this is all based on hearsay and unequivocally false. See, that's the kind of report I want. All I have to say about this rigorous, analytical, and scientific approach to determining if any of the UFO sightings are real or not in the past few decades, that is boring. I want the whispers. I want the weird game of government telephone that kind of creates all these rumors and whatnot. So even though this report was very in-depth and did go kind of case by case and show how misinformation and rumors can spread, boo to this report.

20:33Yeah, but I think, you know, your excitement over UFOs reflects a UFO frenzy, really, since 2017. The U.S. government has started to declassify and be a lot more transparent about its UFO program in response to this more attention. Very interesting. The Pentagon blamed social media and pop culture on proliferating rumors that the United States government had gone through this massive cover up of stashing alien corpses and reverse engineering their spacecraft. So, Toby, I think you've just been watching a little too much sci-fi. No, and I just contributed to the problem right there. So, hey, screw me for wanting to see if ETs are real or not.

21:10Let's move on. I already asked you to picture yourself one year ago today. Now I ask you to return to four years ago. That's because today marks four years since the World Health Organization declared COVID-19 a pandemic. And boy, has a lot changed since that day. As the pandemic that killed 1.2 million Americans has receded into the rearview mirror for most people, some changes have been stickier than others. Remote work is now a thing, and the amount of days Americans spent working from home has jumped five times since 2019. Other so-called paradigm shifts were more flashes in the pan. Zoom shares, for instance, are down nearly 40 % since March 11th, 2020.

21:51For the most part, though, things have bounced back in a big way. Domestic air travel is now back above pre-pandemic levels. And concert provider Live Nation had its best year ever in 2023, selling 620 million tickets. Neil, four years is a long time. What has stood out to you that's different? Yeah, I mean, I don't want to start on a negative note, but one thing that appears to have been sticky from the pandemic is a rise overall in destructive behavior. I mean, there's been an 18 % increase in fatal accidents involving alcohol, 17 % increase in accidents involving speeding since 2019. One major problem is this chronic absenteeism in schools.

22:31Kids just aren't going to school as much as they used to. The term chronic absenteeism refers to kids missing 10 % or more of the year in school. And nearly 30 % of students were chronically absent during the 2021-22 school year. And this gets really bad in poor neighborhoods. Nearly 70 percent of high poverty schools experienced chronic absenteeism in 2022, up from 25 percent from before the pandemic. So I think this learning loss, the fact that kids aren't going to school will be one of the major ramifications of the pandemic going forward. Kind of on that note, too, homeschooling is very much here to stay as well.

23:09It was kind of forced upon parents during the pandemic, but now it is the fastest growing form of education in the U.S. per Washington Post analysis. Changing gears a little bit to the pharma industry, it's been very interesting to see how big pharma has emerged from this. Eli Lilly didn't even make a COVID vaccine. They made an antibody drug. Now they have Monjaro, though. Novo Nordisk wasn't a player at all in the COVID-19 vaccine scene. Now they have Wagovi and Ozempic. Meanwhile, Pfizer and Moderna, who kind of rode the pandemic to incredible, incredible highs, have missed this new wave of GLP-1 drugs.

23:45So it's interesting to see how the ebbs and flows of big pharma have exited the pandemic and how some are more well-positioned than others. Final note on this is what I think one of the biggest lasting changes of COVID has been sort of a shakeup in where people live in the United States. I mean, we talked last week about how the average distance between people's homes has surged to 27 miles in 2023 from 10 miles in 2019. I mean, that is almost triple. That is a very big change in where people are living in relation to their work. And then, of course, inflation. You cannot talk about that massive.

24:21You cannot talk about pandemic without that massive stimulus and inflation going up to 9 percent. I think that's still being felt specifically in the housing market. In Q1 2020, the median U.S. home sold for$329 ,000. By Q4 2023, less than three years later, it has jumped 27 % to$418 ,000. I think this shakeup in the housing industry is going to be a lasting impact as well. Finally, here's your preview for the week ahead. SpaceX hopes the third time's the charm for Starship, the most powerful rocket ever built. A third launch of Starship is tentatively scheduled for Thursday, and SpaceX hopes its mega rocket accomplishes a lot more than during the first two launches.