Prime Day Could Rake in Over $23B & Tariff Uncertainty Keeps Lingering

0:28This episode is brought to you by Progressive Insurance. Good morning, Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, Amazon Prime Day is back, so this entire podcast is 30 % off. Then remember the 90-day pause of Liberation Day tariffs expiring tomorrow? Well, Trump moved the goalposts again. It's Tuesday, July 8th. Let's ride.

0:54Toby's back. Kyle filled in for you yesterday and, as always, knocked it out of the park. But Toby, we got to know, what were you doing that was so important that you needed an extra day of break? I proposed to my girlfriend at Neil, which means I don't have a girlfriend anymore, but a fiance. Two big takeaways from the weekend were first and foremost, best couple of days of my life. Her family flew out and surprised her. All her friends were there. My sister planned a trivia night and a field day for us. So fun. But the other big takeaway is that I have the best in-office small talk locked and loaded for the rest of this week.

1:29Anytime someone says, hey, how was your break? I can hit them with, oh, it was good. Got engaged. I'm going to be a first five minutes of the Zoom call celebrity for the rest of the week. But, yes, if you want to see pics, check out my Instagram. So happy to finally get the upgrade from boyfriend and girlfriend to fiance. And I have to add, you're not the only one on our team who's officially off the market or who has some good small talk fodder. Olivia Graham also got engaged two weeks ago. I can hear the bells. And now a word from our sponsor, Mortgage Matchup. Neil, would you say you're a borrower?

2:04Yes, in the sense that I did plan to give you your phone charger back. You've had my phone charger this whole time I was talking about Mortgage Matchup, bud. Ah, yes. Mortgage Matchup powered by United Wholesale Mortgage. They help borrowers connect with independent mortgage brokers in their area. That way, regardless of where they are in their home buying journey, they get the help they need to feel comfortable and confident throughout the process. Yep. They connect you with independent licensed professionals in your area who can shop on your behalf and give you access to more home loan options like conventional 1 % down purchase, VA loans, and more.

2:37That can save you thousands of dollars. So you can buy a new phone charger. I want mine back. And I want our listeners to check out MortgageMatchup.com to speak to a home loan expert. That's MortgageMatchup.com. Disclaimer, United Wholesale Mortgage, LLC, equal housing lender, NMLS number 3038, licensed in all 50 states and the District of Columbia. Well, we haven't said the T word in what feels like a while, but tariff tensions ratcheted back up yesterday as Trump lobbed out some more levies. Technically, tomorrow, July 9th, was the deadline from Trump's original Liberation Day tariff pause. But in a White House press conference, Press Secretary Caroline Leavitt announced that Trump will sign an executive order pushing that deadline to August 1st.

3:21Trump also targeted two major partners threatening 25 % tariffs on Japan and South Korea yesterday. And later, he released identical letters notifying the leaders of Malaysia, Kazakhstan, South Africa, Laos, Myanmar, Serbia, Bosnia, Indonesia, Cambodia, and Bangladesh of new tariffs ranging from 25 to 40 percent. Despite the White House's pledge to deliver 90 deals in 90 days, global trade remains just as murky as it was back in April, with deadlines shifting and many talks still in limbo. Outside of the new tariff rates announced yesterday, the only finalized agreements so far are with the UK and Vietnam, while EU negotiators scramble to finalize a bare-bones deal.

4:03Talks with other key partners like Mexico remain unresolved. Trump also took aim at BRICS nations yesterday, Brazil, Russia, India, China, and South Africa, with threats of additional tariffs ahead of their upcoming summit. Neil, Treasury Secretary Scott Pesant told CNBC yesterday he expects several announcements in the next 48 hours. So it looks like trade policy is back front and center again. There is a lot going on yesterday. The big picture, the bottom line is that this is Trump buying time for more negotiations. negotiations. In many ways, we are back to April 2nd, because if you look at the specific tariff rates that are being threatened against all of the countries that you mentioned, they are very much in line with those announced on Liberation Day.

4:49Take Japan, for example. They were going to be hit with a 24 percent reciprocal tariff. Now, on August 1st, they are being threatened with a 25 percent tariff. Same with South Korea, 25 percent. 25 % go down the line. The margin of difference in percentage points is anywhere between 10 for all of those countries. So in many ways, we have just reverted back a few months to Liberation Day, but the market response was different. It seems like investors have learned a bit. Perhaps it's that taco trade that Trump always chickens out and that these tariff rates that are being threatened never actually come to pass.

5:27Investors have learned their lesson. Back then, after Liberation Day, stocks tanked six trillion dollars yesterday they did fall s &p was down 0.8 percent not as devastating yeah we did see some specific companies like automakers that have exposure to south korea and japan have a little bit of a rough day but yeah it does look like the analysis here from people familiar with trade negotiations is that uh the president trump is trying to light a fire under these trade partners that he thinks aren't moving quick enough to strike deals with them. But one of the headline news here is that two of our closest allies are Japan and South Korea.

6:06So levying those tariffs, those 25 % tariffs against those two, especially as we are trying to cooperate with them when it comes to semiconductor manufacturing, stuff like chip building, energy and the like, when we are taking on a China, that does throw a wrench in a lot of people's conception of global free trade right now, because South Korea and the United States have had this free trade agreement dating back to 2012. And these new tariffs violate that free trade agreement. So it does call into question the entire value of engaging in a free trade agreement with the United States, because if you can violate it with a close ally like South Korea, then why would you ever sign a deal with the United States?

6:46And a couple of big business leaders who represent many firms sounded off and their their central frustration was that we have more uncertainty so jay colvin who's the president of the national foreign trade council represents large u.s firms said the president's strategic uncertainty is producing some short-term results but continuing to threaten exorbitant tariff rates is just paralyzing for business decision making and erodes trust with our allies and major trading partners going on over to the chair of the Institute of Supply Management's Manufacturing Business Survey, Sue Spence. She said, whatever deals they're going to be, let's just ink it and move on because all the uncertainty is keeping businesses from investing.

7:27The good news is that from all of these tariff threats and actual implementation over the past few months, we have yet to see inflation rise. CPI, the Consumer Price Index, has come in lower than expected for a few months now. We'll see whether these new trade threats will change the equation. But essentially, this is just kicking the can down to August 1st. So I'm sure we will have more conversations in a few weeks. Today would be a great day to work from home if you can manage it. Amazon Prime Day begins and you don't want your boss looking over your shoulder as you scoop up enough discounted electronics to fill a Best Buy.

8:01Now in its 10th year, Amazon Prime Day has become a sales behemoth that drives even more spending than Black Friday. In fact, Adobe projects that online spending during the Amazon Prime Day event will grow to nearly$24 billion this year, or the equivalent of two Black Fridays. And that's for a number of reasons. One, because Amazon Prime Day is no longer just one day or even two. It's four, extending 96 hours for the first time ever. And it's no longer just Amazon offering deals. Most other major retailers like Walmart and Target have piggybacked on the trend running their own sales events in conjunction with Amazon this week.

8:37So the ingredients are there to juice spending and expected 28 % over last year when people spent$14.2 billion during Amazon Prime Day's two-day event. If you're already thinking about what to order, Amazon gave a sneak peek that includes up to 50 % off some apparel and shoes, up to 40 % off TVs, vacuums, and Samsung tablets, and up to 30 % off toys, fragrances, and away suitcases. Toby, America loves nothing more than a made-up shopping holiday. It's completely made up, and yet now it's bigger than Black Friday, which is admittedly also kind of a made-up holiday as well. But yeah, Prime Day is expected to generate$23 billion in gross merchandise value, according to Bank of America.

9:18Compare that to its big competitor, Walmart. Walmart's entire U.S. e-commerce operation reported$79 billion in sales. So four days of Amazon Prime is about as big as a quarter of all of Walmart's e-commerce sales. So right now, this is not a fair fight. But that being said, a lot of e-commerce operators are saying, we are pretty happy now that Amazon is not the only game in town, that these other brands like Walmart feel like they can go toe-to-toe and offer their own sales, period. They're investing more resources into targeting Walmart Plus and targeting these online operations from Walmart because right now it looks to be growing at a rate that does warrant that additional investment.

10:04So it is good to have multiple games in town. It's good to have multiple places to find deals, not just Amazon Prime, even though Amazon is still the biggest game in town. Yeah, in terms of their subscriptions, 73 % of respondents to a Jefferies consumer survey said they have a Prime membership, which is really what this whole thing is about. You want Amazon's trying to get people on its subscription, its Prime subscription. 26 % to that survey said they had Walmart Plus, which is Walmart's rival, to Amazon Prime, and just 22 % for Target Circle. Another thing to watch for Amazon Prime Day is whether people use Rufus.

10:44And if you're wondering what the heck Rufus is, it's Amazon's chatbot that you'll see pop up as you are searching for whatever you're gonna buy today or over the next week. And it's supposed to be Amazon's big launch into AI and helping you search for all the things that you want to find and give you product recommendations and help you summarize the very complex Amazon marketplace. It was launched, Rufus was launched just a few days before Prime Day last year. people complain like it wasn't certainly ready for prime time i don't know whether it's ready for prime time one year later i was playing with it before this show yeah instead of prepping but it was very it seemed it felt to me like a chatbot from 2013 just very basic interface and was getting a lot of things wrong when i was asking a question yeah i mean i was looking over your shoulder as you were playing with it and you asked it hey come up with some sales for me based on my shopping habits and what it did was return the status of your order which you're not supposed to see yeah I wasn't supposed to be looking over your shopping habits.

11:45But yeah, it just wasn't necessarily working. A lot of people are saying that Amazon's traditional search engine with its filters that you can toggle about price and, you know, when you want it delivered are a lot more efficient than going through this chatbot rigmarole. So, yeah, Prime Day is big. I don't know if it's going to be, you know, the big coming out party that they want for Rufus. But certainly a lot of sales are going to be generated. Elon Musk is once again launching a side quest into politics and Tesla shareholders are once again mounting a revolt. Tesla stock fell nearly 7 % yesterday, losing$68 billion in value after its CEO announced over the weekend he would form the America Party, a third political party in the U.S.

12:25to give voters a third option besides Republicans and Democrats. As Taylor Swift says, I think I've seen this film before. Tesla shares were down more than 40 % for the year as Musk spent less time working on the automaker and instead focused on cutting costs in the federal government through Doge. When Musk left his role in the White House at the beginning of May, Tesla's stock shot up 22 % for the month. So as Elon's attention goes, so goes Tesla's stock. And this latest foray into building a new political party is frustrating investors who are desperate for Musk to lock in on turning around what's been a miserable year for the struggling company.

12:58Tech analyst and Tesla supporter Dan Ives summed up the sentiment. writing very simply, Musk diving in deeper into politics is now trying to take on the Beltway establishment is exactly the opposite direction that Tesla investors slash shareholders want him to take during this crucial period for the Tesla story. Ives even floated that the board will now have to get involved, telling Bloomberg there's a line in the sand that he's now starting to cross. Toby, where does Tesla go from here? I don't know where they go, but it is certainly frustrating for Tesla shareholders, especially because if you looked at Elon's feed over the last few days, he did this poll saying, should I create a new political party?

13:39And when he first dropped it, the yes category got like 80 % of the vote. But then over time, as I think a lot of Tesla bulls started to weigh in, it slowly started inching downwards to only 65 % answering yes. So technically that is the majority. But again, I think it shows that Wall Street certainly does not agree with this approach because it is so frustrating to see his attention that was already fractured between a bunch of companies now being fractured even further in a money losing enterprise, which is politics. Like there is not going to be a lot of money coming in from creating a party.

14:13Why would he create a party? He does think that focusing on certain congressional races would help tip things, especially when the votes in the Senate and in Congress right now are so razor thin. So he just wants to get one or two seats here and there and thinks that can shift thing and advance his agenda of trying to reduce the deficit and also bring back some of these subsidies for some of his companies. But yeah, if you are a Tesla shareholder, you're just saying, focus, buddy. Like, we need you here because Tesla is not in a super good spot right now. No, it's in a super bad spot. Over break on Thursday, Tesla released its Q2 delivery numbers.

14:48They were 13 % lower than the year before, which was about the same as the year-over-year decline in the first three months of the year. It's getting its butt whooped in China. In May, Tesla sold fewer than 40 ,000 cars in China, which is down 30 % from the same month a year earlier. It used to have 11 % market share in China. Now that is down to 4%. Its local competitors are eating its lunch. And the reason I mentioned China is that this is its crucial growth market. This is its second biggest market for revenue as compared to the United States. And it's its biggest export and production hub.

15:28Looks like what's happening to Apple in China, where it went from number one in the pecking order to number three being leapfrogged by domestic companies is happening as well in China for Tesla. And its robo taxi rollout two weeks ago left a lot to be desired. So the last thing that shareholders want Elon Musk to do is take even more attention away from turning around this company. We're going to take a quick break, but up next we have Toby's Trends. If growing up your power level was over 9 ,000 and you Naruto ran from class to lunch, you may have been on the fringes of your high school scene.

16:06But now your anime watching habits are far from niche as major streamers have thrusted a once-fringed genre into the global mainstream, a trend that I want to talk about on today's edition of Toby's Trends. As the Anime Expo wrapped up in Los Angeles this past weekend, Netflix revealed a staggering stat. Over half of its global users, amounting to 300 million individual viewers, now watch anime. That announcement is corroborated by a recent study from the marketing firm Dentsu that found 48 % of global anime viewers subscribe to Netflix specifically to watch anime, meaning the king of the streamers is also the number one destination for anime lovers.

16:45It got to that top spot by one, having a lot of anime content, and two, having a lot of good anime content. 33 anime shows made an appearance in Netflix's global top 10 non-English rankings last year, more than doubling the figure from three years prior. And viewership of anime in general on the platform has also tripled over the last five years. If you look at Netflix charts right now, you'll see K-pop Demon Hunters, an anime about two K-pop stars who, you guessed it, moonlight as Demon Hunters, sitting at the top of the most streamed movies on Netflix. A song from the show is also charting at number one on the U.S.

17:22Spotify charts, a feat that not even K-pop kings BTS have pulled off. So Neil, in total, anime content was viewed over one billion times globally on the platform last year. That is a cultural juggernaut. Should we host a Sakamoto Days or Cyberpunk Edgerunners 2 watch party? I'll tell you, I need to start watching these shows. They look absolutely incredible. Why is anime blowing up right now? You mentioned those staggering growth numbers for over just the past four years. Well, let's look to that Dentsu survey. Three in 10 anime viewers, according to that survey, say they're turning to anime because of fatigue with repetitive Hollywood franchises.

18:00and what they're seeing in anime is more storytelling depth, emotional nuance, cultural diversity, unique worlds in stories, things that you don't get from the rehashed IP that typical American Hollywood productions put out on TV and movies. And they're just finding new interesting stories that speak to more adult lived experiences. And I gotta say, that's a very compelling proposition right now at a time when it feels like you're watching the same show over and over and over. Yeah, and when it comes to Western animation versus anime. Western audiences are more typically accustomed to familial fare, family-oriented movies like from Pixar.

18:38That is what animation in America feels like. So anime audiences are much more catered to adult themes and these storylines that you wouldn't take your family to go see. So that is another reason why they're bringing in these big Western audiences. The other thing too is anime fans like to spend a lot of money. 40 % of American viewers reported spending over$200 on anime merchandise in the past year. So this fandom runs very deep. It's not just tossing on Netflix. It is like this thing that is core to your identity. You buy merchandise, you buy the goods. And that is another reason why these streamers are no doubt happy to welcome this audience with open arms.

19:19I feel bad for Crunchyroll though because Crunchyroll was the original anime purveyor in the United States. It is the go-to place for anime lovers. But now it has been leapfrogged by Netflix, Disney +, and Prime Video. It is the fourth most popular option for streaming anime in the United States, which is tough when you kind of pioneer the medium in this Western audience. But Netflix muscled in, and it made this big bet, and it is absolutely working. According to that Dentsu study, it's 48 % of global anime viewers, when they want to watch anime, they turn on Netflix, putting it way ahead of other streamers like Disney Plus, 32%, Prime Video, 29%, and Crunchyroll in fourth place.

20:01So this is a big win for Netflix, and it's certainly going to tout these big subscriber numbers and these big viewing numbers for anime as it did over the weekend. It's going to invest even further. Let's spin to the finish with some final headlines. ByteDance may have found a workaround to get your screen time numbers back up. The TikTok owner is reportedly developing a spinoff app for U.S.-based users, according to the information. The U.S. version of the app would hit app stores around September, pending a sale of its operations to a group of non-Chinese-based investors. This saga dates back to 2024 when Congress passed a law banning TikTok under Joe Biden.

20:39but Trump has leaned on executive orders to prolong the deadline three times since the app briefly went offline back in January. Any agreement would still require the approval from the Chinese government, which remains locked in negotiations with the Trump administration over tariffs. But Neil, it looks like a U.S.-only version of the app is expected to be part of the calculus. Over this entire drama, do you know how long TikTok has been actually offline? One day earlier this year in January. We'll see whether this dupe app will be popular. You know, people will have to download this new app, which probably won't contain TikTok secret sauce algorithm because that's the one thing they don't want to give away in a sale.

21:20And the other mystery is who is going to buy this new version of TikTok and what the price will be. So still a lot of questions, but it looks like finally this is moving towards the end game, which we're all very happy about. Y 'all know the beer industry has been on the struggle bus, but there is one standout, Lionel Messi, and a sea of middling MLS players, Michelob Ultra. U.S. store sales of Michelob grew by 3.1 % in the 12 weeks ended June 14th over the year earlier, according to the Wall Street Journal. Meanwhile, sales of Modelo, Bud Light, Coors Light, and Miller Light all fell during the same period.

21:55And last year, Michelob Ultra leapfrogged Bud Light to become the number two selling beer in America, right behind Modelo. Execs at AB InBev, Michelob's parent company, say the brand's ability to stay strong among those broader headwinds can be chalked up to its low-carb, low-calorie pitch that targets health-conscious consumers and establishing a strong tie-in with sports for those who play and for those who watch. Yeah, we've all seen a messy commercial about Michelob Ultra. They also had a pickleball commercial that ran during the Super Bowl. There's my daily pickleball mention. But a lot of industry watchers have said, Michelob Ultra has separated itself from the pack because it's just been so consistent with that messaging.

22:35A lot of people do know it's skinny can. They do know it's low calorie appeal. And it does seem like the perfect beer for those days when you don't want something heavy. Or maybe you're watching a soccer game in the early morning hours. You don't necessarily need a heavy beer on the weekend. So that low alcohol volume, that health conscious image has made it so that it is now on the rise while everybody else in the industry seems like it's on the downward trend. Next time you pass through TSA to board a flight, your security line may be a little faster and a little less stinky. That's because effective yesterday, the TSA will no longer require passengers to remove their shoes at security checkpoints.

23:17If you are a child, senior, or have pre-check, this rule was already a thing of the past, but despite no major announcement from TSA, the rule quietly went into effect on Monday. According to Gary Leff from the aviation publication View from the Wing, the rule was never really necessary in the first place. The infamous shoe bomb plot from an American Airlines flight back in 2001 was a one-off threat that Lef says wouldn't have been that effective due to the amount of explosive involved, but also led to a whole security measure being designed around a single data point, which he says is just poor risk management.

23:50But now the rule has been sunsetted. So keep those shoes on, Neil. Keep those piggies from going to the market. Pour one out for pre-check. It'll be interesting to see how many people got TSA pre-check so they wouldn't have to take off their shoes. Perhaps in some instances, it's also a much faster line than the than the regular security line. But I'm sure a decent amount of people got this got pre-check to not have to take off their shoes. Now that that rule is gone, we'll see whether pre-check and hold its muster against clear and just the regular security line. when are liquids coming next?

24:27That's what we all want to know. Okay, finally, a stranger than fiction trial that gripped the entire country of Australia for the last nine weeks has reached a dramatic conclusion. A woman was found guilty of murdering three of her husband's relatives and attempting to murder a fourth by inviting them over to her house for lunch and poisoning them with a dish of beef wellington laced with death cap mushrooms, which killed the three victims within a week. The prosecutor never named a motive, but proved the woman was guilty through the steps she took to cover up her crime, such as faking an illness that made it appear she ate the mushrooms and inventing a cancer diagnosis as justification for hosting a lunch in the first place.

25:05This case, understandably, was a national obsession in Australia where newspaper outlets covered every last minutia and podcasts recapping the trial racked up millions of downloads. I mean, how could you not be obsessed with this case? It really was just a once-in-a-generation storyline. The prosecutor here had a unique approach where they didn't really focus on a motive for the actions at all, but they did dig into the four deceptions that they said were at the heart of the case. One about the fact that she fabricated this cancer claim that was just non-existent as a pretense to invite the relatives over for lunch.

25:40And then there's also that she didn't mean to put the mushrooms in and that it was just an accident the whole time. She also tried to make it seem like she was suffering from the same symptoms that Death Cat Mushrooms poisoning that occurred in her victims. She was pretending she was sick as well. So every zigzag and turn of this story seemed more salacious than the last. And the fact that Beef Wellington and mushrooms were at the center of it all made it so it captured national and global attention. So the case is finally wrapped up. We talked about it on the podcast when it first became national news because it just is so juicy.