Meta Launching Twitter Rival Threads & US and China’s Semiconductor War

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

0:34Good morning, Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. On today's pod, the FBI will have to cancel its three martini lunches with YouTube and we'll do an in-depth recap of the Nathan's Famous Hot Dog Eating Contest. Then we'll talk about how Mark Zuckerberg is busting out the copy and paste strategy once again. Plus, a new company is getting closer to getting their flying car off the ground, which is one small step for cars and one giant leap for people who love the Back to the Future movie franchise. Neil, it's Wednesday, July 5th. Let's ride.

1:11All right, Toby, we're back. I'm so glad you said that it's Wednesday because I have no idea what day it is. I'm proposing a federal ban on July 4th, happening on a Tuesday. Even if it happens on a Tuesday, we should not celebrate it on a Tuesday. sleeping last night was brutal this was my first fourth of july in new york city i couldn't believe how late the fireworks i felt like such an old man shaking my fists at the clouds but yeah well what was the highlight of your uh your little break here so neil i actually calculated it i played 189 holes of golf that's over over the five day period which at a scoring average of 83 equated to 871 strokes in total.

1:53How sore are you? My body's in shambles right now. It hurts so badly. How about yourself? Let's see. I made homemade pasta with my dad. Oh, no way. Yes, a little ravioli and spaghetti. It's not hard. It's not hard at all. Do you have one of those machines where you roll it out? Yeah. You're fancy. It's super cool. And this is a bucket list item. I finished the New York Times Sunday crossword in pen. No way. Yeah. Very bold. Yeah. I'm a pencil guy and I can't even finish it anyway. So good on you. All right, Neil, let's jump into our top story of the week where Mark Zuckerberg is going bird hunting.

2:29Tomorrow, Meta is expected to release a text-based social media app called Threads that many are already crowning as a potential Twitter killer. Here's why Elon Musk might be shaking in his boots a little bit. One, you can connect your Instagram profile to your Threads profile, meaning you can easily reach the audience you've already built up on IG. That's a super compelling pitch for an influencer like you or me, Neil, who already has a huge Instagram audience to try out the new app. Also, two, Twitter is on shaky footing right now. Its revenue is expected to be down by at least$1.5 billion this year.

3:05And just this past weekend, Elon instituted a rate limit on Twitter, which limited the number of tweets people could see, effectively neutering the platform for people consuming content on it, which at the risk of stating the obvious is not a good idea if you are a social media company. So Zuck is striking when Twitter is at its most vulnerable, as he so commonly does. And Neil, if I was Elon, I would be a little scared because Zuck is a pro at doing this. He really is. I mean, if you look at the other Copycat products, they've been pretty successful. You've had Stories, which now accounts for more than 25 % of Instagram's global ad revenue.

3:44And that is a complete Snapchat knockoff. And then when TikTok came on the scene, Zuck was like, that is working really well. Let's do that. And so they launched Reels. And he said that back in February that Reels playtime doubled in six months thanks to its new AI discovery engine. And now, honestly, when I'm on Instagram Reels, I forget that I'm on Instagram and I think I'm on TikTok. And then I'm like, this is pretty great. So Zuck always shows that you do not have to be first to this game to be, you know, super successful. And like you said, with when you have an Instagram built in audience, it's much easier to say, oh, I guess I'll use this rather than, oh, I have to go to Mastodon or Blue Sky and get an invite to all of these other social media apps that build my audience up from scratch, which is a huge barrier to entry.

4:31Yeah. And honestly, you kind of touched on it a little bit. The thing that makes this such a formidable competitor is just the sheer size of Meta and its group of apps. Over 3 billion people use some form of Meta app like Facebook, Instagram or WhatsApp. And so all that Zuck needs to do is convert 18 % of Instagram users to threads and it'll already create a new app the same size as Twitter. So again, it's just scale always wins in these cases. And 18 % is not that tough to do, honestly. Maybe. Twitter has shown such cockroach. It is a cockroach. You know, you can't kill it. And everyone who says Twitter's dying.

5:10We've heard this for six to seven months now where Elon came and did all these destructive policies. And you can't argue that he has been he has been lighting this forty four billion dollars on fire. But these people are so annoying. And they're like, geez, like Twitter's dead. Twitter's dead. Like you're posting on Twitter and Twitter's still alive every single time. You can't kill it. So maybe Meta's version will coexist alongside Elon Musk's Twitter, but it is tremendous to see the longevity of Twitter in its zombie state, but people still continue to post and go on it. just to run down some of the people who have come at the king and kind of missed is i mean you had trump who launched true social and no one really uses that it's reported that it has 510 000 daily active users which compared to twitter has 217 million so a fraction of the size you have blue sky which is twitter founder jack dorsey's uh kind of contender which is a decentralized version of twitter also very small audience like 50 000 daily active users same goes for mastodon which was another kind of decentralized take on it.

6:13It's just got this magic to it. Like it's very, very difficult to kill. It really is. Not to say that this Threads is guaranteed to succeed because Facebook definitely has a lot of, you know, sketchy history with data privacy and Jack Dorsey and Elon Musk kind of hit at that on Twitter. So we will see it. Plus Instagram's also this visual app and to ask people to start posting text, you know, when they're used to just taking a picture of themselves might not be an easy parallel. So we'll see. But either way, it looks like the more important thing here is that the Musk-Zuck fight cage match seems to be progressing.

6:47Dana White of UFC is organizing it. So there are battles along many fronts between these tech moguls right now. Yeah. All right. Well, we're going to stay in this world of social media for our second story. We're going to talk about a legal case with major implications for the First Amendment and tech companies. Yesterday, a judge blocked parts of the Biden administration, including the FBI and the Department of Health and Human Services, from communicating with social media platforms over content containing protected free speech. This is not a final ruling yet, just an injunction, but it signals that the judge believes that these agencies violated free speech rights by coordinating with social media firms to limit what it considers disinformation on social media.

7:29The backstory here is that over the past decade, the government has begun to work closely with Twitter, Facebook, YouTube, other platforms to curb fake news on things like COVID vaccines and elections. Two Republican attorneys general from Missouri and Louisiana sued, calling this coordination a federal federal censorship enterprise. They and other Republicans argued that the Biden administration was using COVID and election misinformation as an excuse to bully social media companies to take down content it didn't like, such as criticisms of mask mandates or the Chinese lab leak theory. Yeah, I mean, this judge was not holding back at all, too.

8:05He said that the government, the U.S. government, has assumed a similar role to an Orwellian ministry of truth. So basically saying that, yeah, the government was way overstepping its boundaries, meddling in these private companies, how they they regulate social media. So it's definitely one of those things that hits at the center of like one of the core tenants of America, which is free speech. So I can see why this case is kind of symbolic of like this. Oh, yeah. This fight has been going for a while. Meanwhile, the response from the DOJ is like and the Biden administration is like this was a very dangerous time where we have, you know, other countries meddling in the election and we have, you know, a dangerous pandemic that's killing millions of people.

8:46And we're just doing the role of government, which is promoting public health. And we don't want to see, you know, some people spewing complete nonsense and conspiracy theories on social media platforms when they should be regulating it. So that's why we've been working closely with them. We're helping them take down content and promote stuff that will save lives. And so that's their argument. Yeah. Yeah. The legal scholars, they're kind of skeptical that the government can be held responsible for content moderation decisions because it ultimately does come down to the private companies itself.

9:19But, yeah, it's definitely like the topics themselves, too, are so such hot topics. So this is, yeah, it's Biden versus. This was like the Twitter file stuff. A little bit. Yeah. Going back to peeling back the layers of did like the government say, let's get Trump off of social media, take him off of Twitter. So, yeah, definitely some behind the scenes, like shady stuff. This feels like peeling back the layers to that as well. Yeah, it's been a long fight. Republicans say that, you know, the government is doing too much censorship of social media companies and then Democrats saying you're not doing enough.

9:56You're letting all this fake news proliferate on your platforms and you're not doing anything. So they are just not speaking to each other at all. So we'll see what happens. This is, remember, just like an injunction and the judge will have to have a final ruling on it. We'll have a lot of big implications for social media regulation. We'll see when that happens. We're going to move on away from social media to actual physical commodities. So remember the trade war between the U.S. and China from a few years ago? It's actually still boiling, and China just turned the heat up a notch. On Monday, Beijing said it would restrict exports of two minerals, gallium and germanium.

10:32I know everyone knows what those are. They're used for high-end semiconductors that go into products like electric vehicles, solar panels, and others. the U.S. deems important to national security. These are rare minerals, critical components for making the stuff you use every day. And China is saying the world's manufacturers can't have access to them like they used to. This is the tat in the tit for tat trade war that's been brewing between the U.S. and China for years. But I just want to highlight this. The nature of the war has changed a little bit. What began in the Trump years as steep tariffs on Chinese products like washing machines has turned into a series of export restrictions intended to deny the other side of intermediary materials necessary to make the most advanced tech products, most notably weapons.

11:19So essentially the thought process is since we're the only country that produces X and you need X to make Y, we're going to withhold X or threaten to withhold X until you start to play nice with us. And both sides are doing this. Yeah. First of all, I definitely had the tit for tat line written down. Everybody has a tit for tat. I mean, every article I read was like, this is the tat in the tit for tat. There's no other way to describe a trade war. Yeah, absolutely. But this is definitely a little nerve wracking for America because China produces 60 % of the world's germanium and 80 % of the world's gallium.

11:53You knew that before going in, right? Oh, absolutely. So it's definitely one of those things where if China is throttling the production of this, that's something that the U.S. needs to kind of reevaluate and say, like, all right, this is kind of a big deal. Although there were some analysts that say it's not that scary because an analyst from IDC's Senior Research Center said that there's no major global shortage of gallium or germanium, and both are quite widely produced. And so while there is some risk, he thinks that by constricting the global supply, others would simply start producing more of those two, and it would become economically viable for them to do so.

12:32So again, you can see when you see those 80 % and 60 % numbers, it seems really scary. But some think that others will pick up the slack. Yeah, it could backfire, actually. They're saying that China, by restricting exports of this, first of all, hurts their own domestic manufacturers of these products because you're just limiting your own sales to hurt the rest of the world. Plus, the U.S. and Japan and Europe are like, well, listen, we're already trying to move our supply chains away from China. They're not selling us stuff anymore. Let's just start finding gallium and germanium in our own backyard.

13:07So let's do that. Yeah. On that point, the US and the EU were reportedly considering the formation of a critical minerals club earlier this year, which, by the way, is just an awesome name for a club. I was president of the critical minerals club. Yeah, exactly. So look forward to that because, yeah, you're right. diversifying the supply chain away from China has been a major, major theme of like the last couple of years. Right. So while this thing, while this germanium and gallium stuff, I've said that so often, is not maybe not necessarily. It is like spooky for the chip industry, but it's more of a threat of what could come because China does own a lot of the rare earth minerals that go into EVs and these other high tech products and saying, look, we can do it with these two things.

13:50So Who's to say we can't do it with these other far more important materials that you can't get your hands on? But it's just crazy how these things we've never heard of are so important to build the solar panels and weaponry and the most important things and the most important products in daily life. And when they're like, we're going to curb exports on some thing in the periodic table you've never heard of. And it turns out to be super important. Neelium and Tobium, let's hope that they keep those going strong. All right, Neil, before we jump into our next story, we're going to take a quick break.

14:50Namaste. Visit 1-800-CONTACTS.com today to save on your first order. 1-800-CONTACTS. This episode is brought to you by eBay. Buying parts for your car? You'll know that. Will it work? Feeling. But on eBay, buying parts is different. eBay's free returns means if it doesn't fit or if it isn't what you expected, you just print a label, drop it off, and get your refund fast. No haggling, no stress, and at least 30 days to return any eligible item. Millions of parts, free returns. eBay. Things people love. Eligible items only. Exclusions apply. All right, Neil, right before we ducked out of here for the long weekend, the Supreme Court was making news once again, this time for striking down one of Biden's big pinky promises from the campaign trail that he'd cancel student loan debt for Americans.

15:42We've been talking about this ruling for a long time, and it did not go Biden's way, with the court viewing the plan to cancel up to$400 billion in debt as him overstepping his authority. This one definitely hurts for a lot of people, Neil. 43 million Americans have some form of student loan debt, and up to 20 million could have had their debt completely wiped out had the plan been allowed to stand. Biden says that he does have a plan B in the works, one he says is legally sound. But in the meantime, Neil, this is going to be a rough few months for people who are kind of out of the habit of making this monthly payment.

16:19Right, because there's been this freeze since March 2020. So it's been three years that you've been able to save money that you would have been shelling out for student loan repayments. And now all of a sudden it's going to come as a huge shock in October, I think, is when they start again. And you're going to have to start paying hundreds of dollars a month to start repaying loans that you haven't paid in a while. Also, there's been three years of people going to college and accruing debt that haven't even had to pay student loans in the first place. So there's whole three years of people who are getting it for the first time.

16:53And, you know, there's this 1.6 trillion debt bomb on people's balance books. Yeah, absolutely. There's according to data, actually, there's 7 million student loan borrowers who are 24 years or younger who have never had to make a payment. So, yeah, that little when that starts hitting, it's going to be a real not even just annoying thing, but it's going to affect the wider economy as well. So economists have been debated. We've talked about this, I think, a couple weeks ago. But like, how is the student loan debt repayment going to affect the economy? Because instead of, you know, saving up a couple hundred dollars each month or spending that on something else, you have to pay it back to the government.

17:29And so there's a question of how much this is going to impact consumer spending, which accounts for almost 70 percent of all economic output in the U.S. And I remember we were when we were talking, it was about, you know, retailers taking a big hit. Oh, was Kyle here? No, no. It was retailers. All right. It was especially Target because that is a favorite of Gen X and millennials. So I didn't see whether Target's stock moved or something. But it seems like these retailers are going to take somewhat of a hit. There's a question about what is the extent of the damage. Some economists say it's going to be pretty big.

18:05Some economists say it's not going to be big. Yeah. It's also one of those things where this was definitely split down the conservative versus the liberal bloc of the Supreme Court. And the fact that a lot of Republicans were celebrating this as a win because they see this as student loans were something that was requiring the 87 percent of Americans to pay for what the 13 percent of Americans do. kind of getting at the fact that if you are going to college, you are probably one of the, on the higher end of the income spectrum. And so they're saying that this plan would have bailed out some of the wealthier Americans at the expense of not wealthy Americans.

18:46And so that's why this went to the Supreme Court, why it kind of panned out the way that it did. And then it's also, there's this thing called the major questions doctrine, which has been a real theme in the Supreme Court in the last few years, which is basically under the theory, it's saying that federal agencies cannot institute these new policies that have significant economic impact without having the express authorization of Congress. And some of the other examples are Biden's COVID vaccination, test requirement for large businesses, as well as the EPA using its authority to curb emissions from power plants.

19:25And so there's like this big legal precedent that the court keeps referencing, called the major questions doctrine. And this one also falls under that umbrella. There was this also of a Supreme Court ruling that touched businesses on Friday that we didn't talk about, which was that it ruled that the Colorado graphic designer, Lori Smith, is within her First Amendment rights to refuse to create websites for same-sex marriages. Proponents say that's a big win for free speech, and opponents say that's a blow to gay rights that have been hard won in recent years. The most interesting part, well, not the most interesting, But one weird quirk of that story is that one of the requests that was cited in court papers for the graphic designer services was not real.

20:07Right. It was completely made up. It was a hypothetical. It was a crazy thing that, yeah, how is that a legal precedent? But, yeah, it's interesting. The court's been super busy recently. You have that ruling. And then we talked about affirmative action also on Friday before we left. So it's been a wild week in the last two weeks of Supreme Court news. Now they're on vacation. Right, exactly. So we're not going to get any more Supreme Court news for a while, but it has been incredibly consequential, just like last year. Let's move on to our winners of the weekend. And there was a lot to choose from because it was like a five-day weekend or something.

20:42I will go first with my winner of the weekend. And it's time we crown another sports goat, Toby. Joey Chestnut inhaled 62 hot dogs and buns in 10 minutes to capture yet another mustard bell at the Nathan's famous hot dog eating contest in Coney Island. Chestnut has now won every the competition every year since 2007, except one. And he made it look easy. But it was anything but easy. As lightning crackled in Brooklyn and the rain poured down, the contest appeared to be canceled. But Joey would not be denied his title. Not on this day. not on Independence Day. So he rallied the troops and said, I'm going to get the rest of the guys out and we're going to do this effort.

21:24And sure enough, after a two-hour weather delay, the competition was restarted and Joey did his thing. He came up 14 dogs short of his personal record, but I can't imagine how much his routine was disrupted by the delay. So I'm going to cut him some slack. I can't believe you say it's time to crown a goat. He has been the goat. He is in the pantheon of goats for sure. I'm just saying, maybe in your small world of sports, but I just want to explain to our broader audience just how incredible these achievements are. I was looking to, I saw a tweet about his training routine in the lead up to this, because I am generally interested in how a human body can do this.

21:59And he says that during training, he wakes up and drinks a gallon of water every day and see how few amount of gulps it takes to get it down. And so when he's out of shape, in quotation marks, it takes him 20 gulps to get a gallon of water down. And then when he's in shape, he gets it down to 11 gulps. So that's kind of how he's training his esophagus muscles to gulp faster and his stomach to expand to accommodate that volume. That doesn't sound that bad like drinking water. I thought it was going to be worse. No, he does it in like a minute and a half. Can you imagine putting a gallon of water in your stomach?

22:30I wouldn't be able to move for the rest of the day. The big question here is how many hot dogs can you eat in 10 minutes? I legitimately think three or something. No. Because I tell you why. You could eat six. I can't get over the fact that you have to dunk it in water to make the bun go down easier. That is so gross to me that I would have to eat them just straight up. And if I'm eating them straight up, I'm not getting a lot down very quickly. You could get more than three, though. Maybe. It's gross, though. What's funny is that this competition is actually awful to watch. I only watched the intros with George Shea doing these amazing introductions.

23:06You did quite well, by the way. And then once it starts, I just turned it off. It's horrific. I'm like, I can't watch this. Imagine the sounds too if you were there. Oh, gross. All right, Neil, let's move on to my winner of the weekend. And we've talked a lot about how poorly Elon's$44 billion Twitter side hustle is going. But his main gig at Tesla is working out just fine. So my winner of the weekend is actually Tesla because we got some delivery numbers. And holy moly, cream and cannolis, they are bonkers. Tesla deliveries were up 83 % worldwide in the second quarter. That corresponds to 466 ,000 vehicles delivered to customers, which unsurprisingly is the best quarter for Tesla ever in terms of deliveries.

23:50So a couple of things that may have contributed to those numbers is the fact that Tesla has just kept chopping prices of its most popular cars. Certain models have dropped between 14 % and 28 % in the year since January. So, Neil, I think it's only fair that we toss Elon a bone every once in a while and say, job well done. And you did well, you won the weekend and maybe the quarter as well. I think China accounted for a lot of the growth, which was huge. And a bunch of other EV companies also reported very strong deliveries in the past few days. So if you're looking at your portfolio and you have Rivian stock or Lucid stock or BYD, which is the Chinese company, and you see them kind of pop, it's because I think Rivian posted really good deliveries as well.

24:32And rising tide lifts all boats. So EV adoption is just kind of ahead of the curve of where everyone thought it would be. Right. And all these companies are raking it in. You're totally right. Except Lordstown. RIP. RIP. Speaking of cars, Neil, let's go into our final story where we are finally living in the year 3000 as the Jonas Brothers predicted. And flying cars are finally maybe coming to a sky near you. that's right a company called a leaf or a left or aeronautics has uh received faa approval for test flights of its 300 000 flying car and the appetite for the road in the sky is there the company said that it's booked over 250 million dollars in pre-orders for its vehicle which equates to 834 cars the company says that the model a which is the name of the car is fully electric, has a driving range of 200 miles and a flight range of 110 miles.

25:31Neil, do you think that we're going to see one of these puppies taking an exit ramp and soaring over traffic anytime soon? No. This sounds like a logistical nightmare. What was funny to me is not only does it need approval from the FAA, but it also needs approval from the National Highway Traffic Administration. So getting both of those, it just seems there's no way this is going to happen. And we do not have the regulatory framework to encompass what you just said for a car to, you know, go off an exit ramp and just fly over everything else. It's not going to happen. That's what they're imagining, by the way.

26:06They're imagining this as a decongestion tool because you can fly, literally fly over traffic. They're also, it's a fully electric vehicle, but they're also saying that there's a hydrogen option coming at a higher price. It feels like they're just speed running every futuristic term that we have. Flying car, hydrogen powered. This is not going to happen anytime soon. But it is kind of fun how it flies. Did you see that? It rotates. So when you're stuck in traffic, you take off. And then it rotates 90 degrees so that the front and back of the car now become the two wings. And you rotate 90 degrees as well because you're kind of suspended in the quote unquote cockpit.