Tesla’s Robotaxis Have Arrived & Oil Prices Jump After US Strikes Iran

0:00This episode is brought to you by State Farm. Checking off the boxes on your to-do list is a great feeling. And 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.

0:28Good morning, Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, markets are on edge, but not panicking after the U.S. struck Iran nuclear sites. Then driverless Teslas are cruising through Austin, Texas, after the company finally launched its autonomous robo-taxis. It's Monday, June 23rd. Let's ride.

0:51The business world lost one of its legends on Saturday when Fred Smith, the founder of FedEx, died at 80. Smith had the potent entrepreneurial combo of scrappiness and vision. At age 26, the Vietnam veteran launched Federal Express on the bet that people would pay if a parcel absolutely had to get to a different location overnight. Turns out he was correct. And FedEx grew from Smith and a couple of small planes in the 70s to a global delivery behemoth with annual revenue of$90 billion and half a million employees. Along with UPS and other rivals, FedEx has been instrumental for greasing the wheels of international e-commerce.

1:30But Toby, it almost didn't happen. Yeah, he also has one of the best pieces of business lore that every NBA student has heard. That story goes that FedEx was down to its last$5 ,000 and couldn't pay a$24 ,000 fuel bill. So what did Fred Smith do? He flew to Vegas, played blackjack, and walked away with$27 ,000, just enough to keep the company alive so they could secure time to get more funding. Totally reckless, but it totally worked. So along with pioneering this hub-and-spoke model, this story is very much a part of his legacy. Maybe not advisable, but a great symbol of what entrepreneurial spirit looks like.

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3:14Eczema isn't always obvious, but it's real. And so is the relief from EBCLIS. After an initial dosing phase, about 4 in 10 people taking EBCLIS 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. Also called atopic dermatitis that is not well controlled with prescription therapies used on the skin or topicals or who cannot use topical therapies.

3:50EbGliss can be used with or without topical corticosteroids. Don't use if you're allergic to EbGliss. Allergic reactions can occur that can be severe. Eye problems can occur. Tell your doctor if you have new or worsening eye problems. You should not receive a live vaccine when treated with EpGliss. Before starting EpGliss, tell your doctor if you have a parasitic infection. Searching for real relief? Ask your doctor about EpGliss and visit epgliss.lily.com or call 1-800-LILY-RX or 1-800-545-5979. Risks to the global economy have heightened after the United States struck three Iranian nuclear sites on Saturday, joining Israel, who had been trading attacks with Iran for over a week.

4:23In greenlighting the mission, President Trump said his objective was the destruction of Iran's nuclear enrichment capacity and a stop to the nuclear threat. He called the strikes, which involved 125 aircraft, including B-2 stealth bombers, a spectacular military success. But Intel assessments of the damage to nuclear infrastructure are ongoing. The Pentagon said the strikes caused extremely severe damage. With the United States, the world's biggest superpower entering the fray, what had been a Middle Eastern regional conflict could expand to threaten economic engines from oil flows to commercial shipping to aviation.

4:57But so far, SOCOM. Stock futures ticked higher this morning and oil prices barely budged overnight after gaining 11 % since Israel first attacked Iran. If oil continues its upward trajectory, it could push inflation higher around the globe and prevent central banks from cutting interest rates. But the big question is if. The ball is now in Iran's court and it could take any number of steps to retaliate against the U.S. and Israel, some of which could be economically devastating, but others investors might shrug off. The nuclear option, no pun intended, is for Iran to cut off the Strait of Hormuz, one of the key global choke points for oil.

5:33Iran has threatened to block Hormuz many times before and never followed through. But of course, there are no guarantees. All investors can do now is monitor the situation. And it does look like oil market participants generally believe that an attempt by Iran to block the all-important Strait of Hormuz wouldn't necessarily be a long-term thing. But some analysts do think that the market is underestimating that risk. Now, there's a couple of scenarios that could happen here. The worst case scenario is if shipping is interrupted for multiple weeks or months. But if you don't want to fully shut the straight down, an easy step for Iran would be to just harass ships that are going through the Strait of Hormuz.

6:08One thing that's been happening already is jamming GPS signals that may be most likely led to a crash of two oil tankers last week. So there are options you can do that would force these ships to travel with military convoys, which would make them safer, but obviously very highly inefficient for the maritime industry. So definitely the big option is closing the strait, but you don't necessarily have to do that. And one reason why they would definitely not do that is because it would upset China. Now, China isn't really a country that you talk about with the Middle East conflict, but China buys a ton of oil from Iran.

6:44Iran sells most of its oil to China through the Strait of Hormuz. It's been a mutually beneficial relationship with Iran under international sanctions by the West. If Iran decides to close the Strait of Hormuz, which carries 20 percent of all global oil flows, then China would get very upset. And China, you don't want to upset China because it's the second largest economy in the world with a lot of heft. So that is one reason why that investors aren't sending oil prices skyrocket. They don't think that there's going to be a massive supply shock. And one reason why is because Iran doesn't want to upset China.

7:20What happens if they do go for the most intense option, though, and do close the strait? It does look like OPEC members, you know, Saudi Arabia, the UAE could step in and theoretically ramp up that capacity. But they don't have a ton of options for getting that oil out of those markets because, again, you have to go through the strait of Hormuz. That one thing that you do have to note, too, is that while any duration of disruption would be bad, the world's oil consuming nations are the biggest consuming nations have at least five point eight billion barrels of crude stockpiled in reserve right now.

7:53And to put that into perspective, the entire flow of petroleum through the Strait of Hormuz is roughly seven point three billion barrels a year. So there is a little bit of a healthy buffer there. So, yeah. So the world and Wall Street are just kind of waiting to see what Iran does next. That will determine which way they place their bets overall, though. I think you can say that more companies and investors will just be a little more cautious as they wait to see what happens, because we've talked about the fog of uncertainty that's been hanging around the global economy in 2025. It just keeps getting foggier.

8:28I think Mohammed El-Eliran, who's the chief economic advisor at Allianz, former CEO of PIMCO, kind of summed up the situation best. He said the fate of the economy will really depend going forward on whether the U.S. strikes against Iran, open a new, more volatile chapter in this regional conflict, or it hastens the end of the current one. At least from what you can tell on the stock market, they believe that the latter is happening and that this conflict won't expand. But we'll just have to wait to see. At long last, the day that Elon Musk promised for over a decade has arrived. Yesterday, Tesla officially rolled out its autonomous robo-taxi service in Austin, Texas.

9:03For a flat fee of$4.20, a select number of guests were allowed to take a ride in the backseat of what Elon hopes will be the future of the company. Much of Tesla's$1 trillion valuation hinges on the success of its self-driving ambitions. Musk has bet millions of dollars and at least 10 years of R &D on a unique approach that differs from its biggest competitor, Waymo. While Waymo makes use of LiDAR, radar, and cameras to create a fully autonomous system, Tesla uses a camera-only system to navigate, cheaper but potentially more prone to errors in bad weather and low-light conditions. The approach has also landed it firmly behind Waymo in the autonomous race.

9:42Tesla's tests included just 10 to 20 Model Y vehicles operating in a limited zone of Austin. The company also said it was going to avoid bad weather, difficult intersections, and will not carry anyone below the age of 18. Waymo, meanwhile, is giving out 250 ,000 rides per week across multiple cities. So, Neil, a very long-awaited day for Tesla fans, but perhaps a more muted debut than expected after a decade of hype and promises. Yeah, I think one example that sums up the competition here is that Sawyer Merritt, who is a pro-Tesla poster on X, said he saw 30 Waymo vehicles go by just while he was waiting for his Tesla robo-taxi to come.

10:20There are a number of bull cases for Tesla, if you want to be bullish about this company, and a number of analysts are. One is the cost that you mentioned. Tesla is building a CyberCab, which is an autonomous vehicle that will cost$30 ,000 or maybe even less. Waymo employs Jaguars that cost more than$70 ,000. And that is before you add all the tricks that they need on top, like the sensors, in order for them to be autonomous. They already have a huge base of cars out in the wild, which are mapping and collecting data. There are millions of cars out. Tesla's because people have just bought them.

10:57And Musk's vision is for people, Tesla customers to use them like Airbnb. So you parked your Tesla and you're not using it maybe for the weekend. Well, you can go rent it out and it will go by itself and carry someone autonomously around the city. So those are maybe some of the bull cases. And there are a number of bear cases as well for Tesla with its robo taxi service. Certainly a huge hurdle to climb. Yeah. I mean, the projections that people think this autonomous ride hailing unit could be worth are pretty eye opening. I mean, Cathie Wood, who is an Uber Tesla bull, thinks that by 2029, it could be a$951 billion business for Tesla around 90 percent of its earnings.

11:38So this is certainly a period where they think they are transitioning from selling vehicles to becoming an autonomous ride provider. So that is like the lofty goal here. And I mean, Elon was talking about this launch, saying that Tesla cars should be able to operate autonomously for 90 percent of miles driven within three years. But just kidding. He didn't actually say that about the launch. He said that back in September of 2013. So it just goes to show you how long he's been talking about this, how long he's been pledging this vision. This was the first baby step in making that a reality. Moving on, as Trump's big, beautiful bill makes its way through the Senate, one provision is causing all sorts of controversy.

12:18Federal land is on the auction block. The Senate's version of Trump's big tax cut and spending bill includes a provision that would open up roughly 250 million acres of public lands in the West, making them available to be sold off to the highest bidder. The idea is to free the land up to boost the housing supply while generating at least$5 billion in revenue, according to Senator Mike Lee, who introduced the plan. But as of right now, selling public land is not a crowd pleaser. A recent YouGov poll shows 71 % of Americans are against auctioning off public lands, and even among Trump voters, support barely cracks 16%.

12:55Lawmakers on both sides of the aisle have also expressed doubt that the land's up for sale would even be suitable for building homes. But the idea has sparked debate about whether there are better uses for some of the roughly 500 million acres controlled by the federal government. Should Uncle Sam be the steward of so much land? Is it too much to manage effectively? What else could it be used for? These are all the questions, Neil, that the Senate will have to consider if the big, beautiful bill is to be passed by Trump's July 4th goal. Proponents of this say that the federal government owns an absurd amount of land in the United States, especially out west.

13:30They own more than half of Oregon, Utah, Nevada, Idaho, and Alaska, and nearly half of California, Arizona, New Mexico, and Wyoming. They say that selling off a small fraction of that, the cap is at 0.75 % of all of that land, is just not a big deal. It could be put to better uses. There are certain exclusions that say that you can't sell off national parks or historic landmarks or all of these things that people hold dear. So the proponents of this, which include Mike Lee and a few other people and a few other Republicans and more libertarian types, say that this is just – you're not really getting the scope here.

14:08There's so much land. Much of it is not for use for recreational purposes. It has no ecological value as well. So why not sell it off? The estimates are that it would raise$10 billion. We have a housing shortage in this country. And so that's what they're saying. That's their argument. Yeah, and some people who live in districts like California think that people maybe have a differing opinion of what public land actually looks like. They think that it's this pristine and perfect place. But a lot of the times because the federal government has so much land to manage, they let it get overgrown and it contributes to wildfires and things like that.

14:44But if you sell those lands off to people to build houses on or maybe even for other interests, that doesn't necessarily solve the land management problem either. So that's a pushback to that. What else could you do with federal land? Some people advocate for turning them more parcels over to universities, to indigenous tribes to manage, particularly where in spots where the federal government is pretty overwhelmed. maybe expand an airport, things that contribute to public good, add a reservoir. That's another plan that's being floated in Utah. So there are economic development ideas. So yeah, it's not necessarily something on the surface that seems particularly popular, and the polls show that, but there are some economic reasons why you might open up some of this land for development.

15:27It's just going back 250 years, this was the debate that the Continental Congress was going about, whether the state should be in control of the land or the federal government. And Americans just have this very emotional tie to the land that should be used for public goods. Teddy Roosevelt, I think, was a big figure in establishing a public land system that was expanded by JFK. So it's just rooted in American history that this vast expanse of land should be given to the people. And that continues to this day. I mean, Ryan Zinke, who's a Republican representative of Montana, is very vociferously against this bill.

16:03He's the former Interior Secretary. He said he was a hard no. This was my San Juan Hill. I do not support the widespread sale or transfer of public lands. Once the land sold, we will never get it back. Yeah. And Montana was actually excluded from this provision because he was, you know, so against it. Let's take a quick break before we get to our winners of the weekend. 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?

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17:24Welcome to Winners of the Weekend, the segment where Toby and I picked two things that did not forget to bring sunscreen to the beach. I won the pre-show sandcastle building contest with a stunning Sagrada Familia replica, so I get to go first. And my winner has a two-note theme song and was the reason you stayed out of the ocean for the first decade of your life. It's Jaws. Steven Spielberg's Shark Attack Classic celebrated its 50th birthday this weekend. And as a gift, everyone is giving it credit for inventing the summer blockbuster. And as they should, before June 20th, 1975, the day Jaws came out in the United States, The summer was considered a trash season for movies.

18:01It was the window when studios dumped their weakest films. Universal and 28-year-old director Steven Spielberg had a different idea. They thought a movie about a great white shark eating swimmers at the beach would be perfectly timed during the summer, so they staged a sprawling marketing campaign to piggyback off the release of Jaws the novel, which the movie was based on, and it was a massive commercial success. Jaws became the first movie to gross more than$100 million at the U.S. box office. It launched the career of Spielberg, and it gave Hollywood key evidence that Americans would pack theaters during the summer for the right stories with mass appeal.

18:34That formula has been replicated by some of the biggest summer blockbusters since, including five in the Star Wars franchise, Top Gun, Finding Nemo, and a bunch of superhero movies. Yeah, and the craziest part is the movie almost didn't happen because the scariest words in Jaws isn't, we're going to need a bigger boat. It was the sharks not working because they had three animatronic sharks that just kept breaking down. It led to massive cost overruns. Spielberg was still an unproven director. He was more than 100 days behind schedule. And a lot of movie execs would come up to movie producers and say, I'm so sorry that you're having to deal with this movie.

19:09It was kind of like this ugly stepchild. Then they showed it to audiences and they went nuts. And it caused them to kind of totally recalibrate their expectations and say, no, this thing needs to go nationally. And that was one of the smartest things that they did is movies at that time usually were kind of rolled out locally where you would buy ads in local papers, you know, target local news stations. But very rarely did you see this big national push to try to create an event around a movie release. Jaws was one of the first movies to really do that, and it worked out so well. This movie was the highest grossing movie in history when it debuted, so it was just a stunning, smashing success.

19:47Great lore about Jaws. As you mentioned, the animatronic sharks, well, they did not work in saltwater. They had so many mechanical problems that the first shark does not appear in Jaws until the 81st minute of a 124 minute film. It was supposed to come before, but they had to push it back because they just couldn't get it working. And that was considered a stroke of genius to create this suspense around what does the shark look like? Everyone's so scared. And to not drop it until the second half of the movie is very Hitchcockian. and it set the template for a lot of movies going forward. And one of the other legacies of Jaws is that it popularized what's known as the creature feature, which many movies have copied since.

20:30It has elements like the creature, remote location, the first anonymous victim, a reluctant hero. There's the oppositional local authority. You got to round up the experts. Some beloved character makes a sacrifice. You have the big confrontation at the end, which results in the creature's death. We've all seen so many movies like that. And Jaws was one of the reasons why you've seen why that's been possible. And I'm still so scared of it. I mean, that was the first, you know, horror movie I watched, and it has affected me to this day. I still don't really like going in the ocean. My winner of the weekend is the Los Angeles Lakers, not because they actually won anything, congrats to the Oklahoma City Thunder on earning a ring yesterday, but because they were just sold for$10 billion, making them the most valuable sports franchise of all time.

21:14The eye-popping prize tag was paid by Mark Walter, the CEO of Guggenheim Partners, a privately held financial services firm with more than$325 billion in assets under management. Walter is also the primary owner of the Los Angeles Dodgers, but buying the Lakers purple and gold means adding one of the biggest brands in all of sports to his stable. The Lakers have been owned by the Bus family since 1979, and in that time they have won 11 titles, the most in the NBA. But the team and the Buses are unique in the sense that the bus family had no other income stream so the lakers are running on the revenue generated by the lakers it helped that they landed a massive local tv rights deal with spectrum that pays them three billion dollars over two decades but that alone it wasn't going to be enough for them to keep up with deeper pocketed teams like their crosstown rivals the clippers who are owned by steve balmer and just spent two billion dollars alone on a new arena with walter at the helm they have a little bit more fun money to play around with after decades of pinching pennies and an owner who knows how to translate those dollars into wins.

22:15Neil, LeBron may be retiring soon, but the Lakers just got the LeBron of sports owners to take the reins. Sports franchise values just keep going up almost exponentially. It was just a few months ago we were talking about another record sale in the NBA and across the professional sports world. That was the Celtics who sold for$6.1 billion. There's just a number of factors driving these valuations so high a lot of it has to do with these massive media rights deals that these leagues are are getting from media companies and that's because live sports is the holy grail of content at this point and that's what draws the eyeballs so every single entertainment company out there is shelling out tens of billions of dollars to these leagues in order to grab up this content and it's sending valuations skyrocketing they also have better data for better monetization They have different revenue streams that they can pull on these leagues and teams.

23:11And then maybe sports gambling is also a factor in driving up valuations. Meanwhile, that's all good and well. But at the same time, supply is fixed. And there's not that many new teams coming in. So if you grab a sports team at this point, it's going to be an excellent investment. How about this, though? I saw a mind-blowing stat on X from Anchor Nagpal. Jerry Buss bought the Lakers for$67 million in 1979. just exited for 149 times that at$10 billion in 2025. That sounds like a lot, right? But that is somehow less than he would have made by simply indexing the S &P 500 over that same time period.

23:49He would have done$13 billion. So the lesson here is just keep buying. Yes, there is more to the story because the Lakers spit off dividends and whatnot, but still a pretty wild stat that just, you know, keep on buying. That's why Warren Buffett never bought a sports team. Exactly. Okay, it is Monday. So here are the big events you need to know about the week ahead. Why aren't you cutting interest rates? Jerome Powell will be hearing that question a lot when the Federal Reserve chair heads to Capitol Hill for his twice a year testimony on Fed strategy. Expect Powell to defend the Fed's cautious, no sudden movements approach as lawmakers press him on what the Fed exactly needs to see with inflation to begin cutting rates.

24:27Remember, last week, the Fed left rates unchanged, saying the economic environment was too uncertain for any sudden moves. I mean, we have to come up with different metaphors to talk about how the Fed isn't changing rates. Jerome Powell has to go in front of a committee and explain the go slow approach every single time. So he is he's got his talking points. He wants to see that the economic impact of the White House's trade policy filter through the economy before they make any sudden movement. So, yeah, the go slow policy approach is definitely going to be defended. New York City's Democratic primary for mayor is tomorrow, which is expected to determine the next leader of the Big Apple.