The NFL Has a CTE Problem & Dolly Parton Dies at 80

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0:29Austin Rief:Good morning Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, a billionaire investor causes a stir by using AI to write a column. Then an ad for a YouTube golf channel went viral for all the wrong reasons. It's Wednesday, August 26th. Let's ride.

0:53Austin Rief:When you receive tributes from Taylor Swift, Beyonce, Pitbull, Eminem, Jeff Bezos, the Empire State Building, President Trump, and the Democratic Socialists of America, and seemingly every single one of my group chats, you know you did something right. Yesterday, Dolly Parton, a uniquely beloved figure in American life, died at 80 after a brief battle with cancer. The best-selling female country music artist of all time, Dolly rose from poverty in Tennessee to sell more than 160 million albums worldwide, writing immortal songs such as 9 to 5, Jolene, and I Will Always Love You. Beyond her music and her acting and her business ventures that included Dollywood, Parton was a prolific philanthropist delivering more than 200 million books to kids through her imagination library, giving$1 million to Moderna's COVID vaccine research, and creating a bald eagle sanctuary, among many other projects.

1:45Austin Rief:Toby, we lost one of the greats, perhaps the great. I'll never forget this story we did on a UMass YouGov poll from earlier this year where 70 % of Americans had a favorable view of Dolly, the highest percentage of approval by far of any person. We can't agree on anything, but most people can agree that they loved Dolly. She was twice as popular as Taylor Swift. Thankfully, we have a little more Dolly to come. She left an unreleased final song called My Place in History that is stored in a wooden box in Dollywood that will be opened on Parton's 100th birthday in 2046. I just hope we make it to then so we can hear Dolly's last song.

2:25Austin Rief:Yeah, there are so many amazing stories and videos and clips being shared. This one stuck out to me though. This was shared by Eminem, Marshall Mathers, and it went super viral yesterday. And the lesson is write to people unsolicited, just telling them how much you appreciate them because this was a letter that Dolly sent to Eminem after he was inducted into the Rock and Roll Hall of Fame and she wrote, your performance was amazing and everybody said so. Even though I don't know a lot about rap music, I've come to know that you are the very best at it. Aside from that, I hope what I have to say will not seem weird or strange to you, but I have always felt some unexplained connection to you, like I know you somehow.

3:04Austin Rief:Keep doing what you're doing because you do it so well and no matter how complex your world may be, just know you are very special and touch people in ways you don't even No. Class act. And now a word from our sponsor, American Express. Neil, I am all go. You're what? I am up the wall. I'm nonstop. I am busy, which is why I appreciate the American Express Business Platinum card. It's built for businesses that deserve more. With a suite of statement credits on purchases with brands like Dell, ChatGPT Business, Adobe, and more, plus the ability to add up to 99 employee cards, Business Platinum helps you do more business.

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3:49Austin Rief:Learn more at go.amex slash morningbrew and find out your welcome offer, which could be as high as 300 ,000 membership rewards points. That's go.amex slash morningbrew. Offer and benefit terms apply. Wall Street has spent the last week dunking on Treasury Secretary Scott Bessent for his unusual intervention into the bond markets, But on Monday evening, one surprising figure jumped on the pig pile, billionaire investor Stanley Druckenmiller, who criticized Besson's maneuver as a serious mistake. And it's so shocking because this would be like Auguste Gusteau turning on Remy. Druckenmiller used to be Besson's mentor when they both worked at George Soros' firm in the 90s.

4:30Austin Rief:However, Besson's drastic move to soothe bonds was a step too far. In a widely shared Wall Street Journal op-ed, Druckenmiller argued the government should, quote, let the bond market speak and described Besson's actions as ineffectual and self-defeating. Governments defending prices against fundamentals always lose, he wrote. The only variable is how much they spend before conceding. But just as everyone was digesting Druckenmiller dunking on his young Padawan, another plot twist emerged that shifted the conversation entirely. Using detection software, online sleuths discovered that he had used AI to write the opinion piece.

5:05Austin Rief:And when asked about it by the site Notice, Druckenmiller owned up to it, saying, of course I used AI to write the column, adding, I'm not embarrassed by it. I write everything using AI. Now, for the same reason, I use a calculator when I do math problems. So, Toby, two levels of intrigue here. First, Druckenmiller going after Besson, but also a much larger conversation about the future of writing in the AI age. Let's start with the first part, because it is juicy. We were kind of discussing yesterday, ah, should we cover this story? It's a little like insidery finance. but it really has a lot of intrigue because of the relationship between Druckenmiller and Besson and the fact that when they worked together, some of their biggest trades came from recognizing this exact situation where governments were attempting to defend or manipulate prices that the market believed was not sustainable.

5:51So if a government says the price should be this and the fundamentals say it should be this other thing, then usually the fundamentals end up winning, and that is what Besson spent his entire career exploiting. So it is such a delicious twist of irony that he's on the other side of the coin now. That is why it's got so much intrigue to this, in addition to this crazy AI subplot as well.

6:15Austin Rief:Yeah, just a quick recap of what he was criticizing and what Besson's move into the bond market was. Well, he doubled the buybacks from the Treasury to these long-dated deals that had soared above 5.5%, which were the biggest level since the financial, before the financial crisis, in order to bring down borrowing costs across the economy. Well, it took yields down for one day, and then they jumped right back up, which showed that the move was ineffectual. And a lot of analysts, and now Druckenmiller is saying, Besson, you know that you have to, you can't really use this interventionist move. You have to, as Druckenmiller wrote, let the bond market speak, use it as a signal.

6:53Austin Rief:And he wrote, if the 30-year must trade at 5.5 % to clear, this isn't a crisis, it is an invoice. do the only thing that durably lowers long-term yields address the primary deficit that was the main point of this column saying you have to address the underlying fundamentals you can't do this financial maneuvering in order to bring down bond yields what you need to do is rein in government spending because that's what bonds investors are going after that was a perfect segue into the ai conversation because the line you just quoted is one of the lines people pointed to that showed it's not X, it's Y.

7:25That sort of AI framing that kind of leaks its way into LLM assisted writing. So this AI subplot really has thrown this entire conversation on its head. Jason Calacanis, which is a big investor, said, if you can't be bothered to take the time to write your own opinion piece, that should tell you it's not worth publishing. But then on the other side of the coin, actually, you go to Chamath, which is Jason Calacanis' co-host in the All In podcast. He said, if Stan Druckenmiller isn't embarrassed to be a meat proxy, which is a new word for the human in the loop of these AI conversations, you shouldn't be either.

8:00It's like after matches were invented, still celebrating the arduous time to rub two sticks together. So those are kind of the two camps that are forming on this AI-assisted writing debate. Should you discount Druckenmiller's words because he had the assistance of an LLM? Should the Wall Street Journal have better fact-checking approval processes to actually publish this opinion piece? It opened a lot of questions that actually overshadowed a lot of the policy rate.

8:26Austin Rief:And the Wall Street Journal defended its policy here. The editorial page editor said, AI is a fact of modern life. People will use it to assist in their work, in their writing, including with research, checking, grammar, editing, and more. So he said, this is fine because we just want to make sure it reflects the author's original argument. So all good on the Wall Street Journal front. I don't know if they were prepared to issue a statement on this, but they were asked and they said, yeah, all good with us. And then on the other side, you had the Financial Times. Recently, this went viral. There was a Harvard professor who was accused of using AI to write an opinion article for the Financial Times.

9:02Austin Rief:And then when the Financial Times found about it, they actually said, uh-uh, this is not okay. They wrote a disclaimer at the top of this column saying it has come to our attention that AI was used to condense a longer draft of this column prior to submission to the FT in our own editorial involvement. The FT editorial code of conduct specifically prohibits the use of AI in the writing process. So you have Wall Street Journal over here, Financial Times over here, and there was huge debate unfolding on social media around the use of AI. Some say in favor of this that investors and CEOs have used underlings and ghostwriters to write opinion columns in books for ages.

9:38Austin Rief:So why would AI be any different? On the other camp, you said, why would a opinion department at a newspaper pay a columnist to write a column using AI when maybe they could just say and not pay the$200 ,000 a year and say, OK, make me an opinion piece in the voice of this particular person that reflects their arguments or opinions. Super interesting debate on two levels. Druckenmiller going after his mentor or his mentee, as well as the larger conversation about what is writing in the AI age. Moving on, American workers have been exposed to a plethora of safety hazards throughout history, but one type of career might be the most risky of them all, professional football player.

10:21Austin Rief:A major new study released yesterday in the British Medical Journal found that at least one in four people who played in the NFL could expect to get CTE, a degenerative brain disease. Researchers from Mass General Brigham looked at all the football players who appeared in at least one NFL game in their careers and who died between 2016 and 2021. Their conclusion, a minimum of 25 % had CTE when they died. It's an astonishing number. David Michaels, the former head of the Occupational Safety and Health Administration during the Obama years, told the New York Times, There are workers who've been exposed to high levels of asbestos exposure, which leads to a very high rate of lung disease, and certainly a lifetime working in coal mines leads to very high risk of black lung disease, but a degenerative neurological disease, I've never seen anything comparable.

11:08Austin Rief:CTE was first scientifically linked to football 20 years ago, and since then, many high-profile players have been diagnosed following their deaths, including Junior Seau and Aaron Hernandez. It is a progressive neurological disease whose symptoms include impulsive behavior like addiction, memory loss, and severe mood swings brought on by repeated impacts to the head. We knew it was a huge problem affecting not only football players, but other athletes and military veterans. But until this study, we didn't have an actual number to assign to it. Now we know 25 % at minimum. So the NFL's response to this was a statement saying the NFL continuously strives to make the game of football safer, including by implementing strategies to reduce concussions and head impacts.

11:46But let's look at a recent rule change that came last season. Last year, they changed the touchback when you kick off the ball to the 35-yard line from the 30-yard line. The idea was to incentivize teams to put more balls into play because that's more exciting for fans to watch. And that definitely did happen. More kickoffs did get put in play. But as a result, concussions spiked because kickoffs are always going to be a time where you have a lot of people running full speed at each other. So again, player safety might take backseat to the entertainment factor, which has been the criticism that has been lobbed the NFL's way for decades now.

12:23We'll see if this latest study does anything to change that approach going forward.

12:27Austin Rief:Yeah, the lead author of the study, Dr. Daniel Dineshvar, said, we know what's causing this. Everyone knows what leads to CTE and its repeated impacts to the head over a life cumulatively. So the risk factor is zero if you're not getting bashed in the head all the time. And so he said this should be used as a call to action to address youth football leagues. Like, let's just not have tackle football until a certain age. Because if we just delay the amount of times these people are getting hit in the head, then we will delay the onset of CTE. And another area of research here is being able to diagnose CTE before a person dies.

13:03Austin Rief:Because right now it's really grim, but what happens is a football player dies young after, you know, maybe showing signs of CTE. And what happens is their spouse or their family donates their brain to one of these brain banks, like the one that was used at BU for this particular study. And then they're able to clinically diagnose CTE now. So a new frontier of research is trying to figure out who has CTU while they're living, because right now this is sort of retrospective. It's 2016 to 2021. We want to know what's happening in real time in the NFL right now. Let's move on. When Dick's Sporting Goods announced the acquisition of Foot Locker back in May of last year, analysts were puzzled.

13:41Was it a good idea for Dick's, who was crushing it, to spend$2.4 billion on a retailer whose sales were flagging? Was it a good idea to increase their exposure to struggling shopping malls? Well, nearly a year later, we have our answer, and it is absolutely not. The analysts were right. It was not a good idea to buy Foot Locker, whose putrid worst-than-expected performance in the latest quarter dragged Dick's stock down 30 % for its largest single-day drop ever. The two brands are moving in totally different directions. Dick's comparable sales rose nearly 5%, while Foot Locker's fell nearly 4%.

14:17Dick's chairman, Ed Stack, told investors, we're going to go through some pain. The pain it's seeing is that consumers simply aren't spending a lot of money on footwear. And if they are, they're expecting brands to discount them heavily, leading to an industry-wide promotional race to the bottom. Dick's would probably pay$2.4 billion to not be in the shoe business right now because everywhere you look, it is carnage. Nike is down nearly 40 % this year, while shares in On and Under Armour are down 20 % in the past month alone. When the acquisition was announced, Dix expected to return Foot Locker to growth by this year's back-to-school season, but that timeline looks out of reach no matter how late school gets underway in the Northeast.

14:56Neil, despite all of that, Chairman Stack is sticking by the decision. Right now, I'm sure some of you are kind of scratching your head, he said, but we absolutely believe long-term this was the right thing to do.

15:06Austin Rief:Yeah, I guess he can take solace that. He is far from the only consumer company that's had a pretty rough earnings go out at Walmart, Walmart had their worst trading day since 2022. They reported their weakest U.S. sales growth in more than six years. S &P's consumer discretionary index is down 5 % over the last month. Back on Friday, we had this U.S. Consumer Center report that was really bad. It dropped heavily. So all these consumer companies are not doing well this earnings season. Foot Locker, which combines a lot of consumer companies and sells them in a retail store, sneakers, that's the most maybe discretionary purchase you can get because you can always get a few more miles in your sneakers, is seeing a lot of slowdown.

15:49Austin Rief:And Stack chalks it up to geopolitics. He said consumers are more cautious due to the war in Iran and inflation. And it's just that's what the environment we are in right now. He also said that footwear became increasingly promotional last quarter. And so what does that mean is basically the shoes that Foot Locker sells are also sold other places like on the website of the brands themselves. And if they start discounting them to consumers, then Foot Locker goes, well, I guess we have to discount too, because you can't be buying the exact same Nikes here that are more expensive versus what you could buy them for on Nike's website.

16:27And they actually made the decision to go down that promotional rabbit hole so as not to lose a market share. So that is kind of why he's saying, yes, it's very painful right now. But over the long term, we think that we're going to keep a grip on the market share we have. We're going to weather this geopolitical storm right now. And on the other side, we do think that we have the know-how, we have the scale to turn this puppy around. But I think one of the reasons why Wall Street kind of freaked out is the fact that what changed in the past 90 days. If you go back three months ago, Dix was raising guidance and sounded very optimistic.

17:01How could you be this far off? How could you tell people with a smile that, hey, I think things are turning around? And then you report earnings and everything goes to heck. that is why you saw wall street you know a cut take a 30 haircut of dicks in this latest uh

17:17Austin Rief:earnings call and another trend i'm watching is we actually did this as a toby's trend when you were out uh that people are shifting to more formal wear and they're not wearing as many sneakers anymore and dick said that actually we are seeing consumers shift to brands like ug and birkenstock instead of the more legacy lifestyle sneakers uh that that footlocker sells. So pretty interesting shift to look at. I don't know if this is, you know, how long this will last, but we're certainly seeing it in the data, the broader trend of people just going to more loafers and Birkenstocks rather than wearing Nike dunks.

17:50I just looked down. I'm still wearing sneakers right now. All right. We're going to take a quick break and come back with a story about that ill-fated golf ad right after this. Every day, shareholders meet to discuss important matters about the companies you invest in. Now you can easily make your voice heard too. Vanguard Investor Choice makes it easy to set your proxy voting preference for your eligible Vanguard index funds. In just a few clicks, you can have a say on important shareholder topics like executive pay and director elections. Visit vanguard.com slash investor choice to learn more.

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19:13When it comes to AI's value, the picture is about as clear as swamp water.

19:19Austin Rief:Case in point, 43 % of CEOs report revenue gains or cost reductions from AI, but nearly the same number say they're still stuck. That's why PwC advises a value over volume approach. Many companies gauge AI progress based on how many models or agents are deployed, but impact actually comes from connecting data, workflows, and decision-making into a coordinated operating model. Learn about turning AI investment into results at pwc.com slash us slash brew AI. That's pwc.com slash us slash brew AI. When you think of big companies in corporate America, you tend to believe they have their act together.

19:59They make millions, employ hundreds, and generally appear buttoned up. But sometimes things happen to remind you that there's always an egg inches away from their face. Case in point, the gigantic screw-ups we've seen in recent days. You may not have known about Good Good Golf, a media and apparel brand with over 2.1 million YouTube subscribers. But after it aired an ill-fated ad last week, it's broken containment from the golf world. Good Good posted a 60-second spot for its co-branded Callaway driver, but somewhere in the creative process signed off on a scene where one of the channel's male personalities shoves a woman on the roster to the ground for trying to touch his new club.

20:38It attracted immediate backlash with ex-commentors calling it very scary and a generationally stupid ad before it was eventually taken down. It was especially shocking considering Good Good raised$45 million in funding last March and is sponsoring an official PGA Tour event this November. Not to mention Callaway, a billion-dollar brand in its own right, was involved in the approval process too. Both companies have since issued apologies with Good Good CEO clarifying that the ad was meant to parody the horror movie Obsession and Callaway reiterating that it is, quote, unequivocally against discrimination, domestic violence, or threatening behavior of any kind.

21:16but Neil the comments under this video range from horror to pure bafflement as to how it made it through multiple rounds of filming and editing without anyone saying uh maybe we shouldn't