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TOGETHER WITH
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Good morning. Today is Columbus Day and, in more than 100 cities and several states, Indigenous Peoples’ Day.
Most banks
are closed and the USPS will not deliver mail, but the stock market is
open for business, which means this newsletter is, too.
—Neal Freyman, Matty Merritt
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Nasdaq
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14,579.54
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S&P
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4,391.34
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Dow
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34,746.25
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10-Year
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1.613%
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Bitcoin
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$54,675.09
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ExxonMobil
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$62.18
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*Stock data as of market close, cryptocurrency data as of 8:00pm ET.
Here's what these numbers mean.
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Markets: The S&P 500 notched a weekly gain
last week, but still remains 3.2% lower than its September peak. Energy
stocks like Exxon Mobil have been huge beneficiaries of rising energy
prices.
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Economy: Goldman Sachs cut its US economic growth forecast for 2021 and 2022, saying consumer spending wasn’t recovering as fast as expected.
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Giphy
...The one who shows up unexpectedly, then gets too drunk and asks to crash on your couch.
New signs
are emerging that higher prices, which had been considered a “fluke” of
the post-pandemic economy, are stickier than many officials originally
predicted. Experts are concerned that persistent inflation could lower
consumer demand and put a chill on what had been a hot recovery.
Sign #1: Soaring wages
In the September jobs report released last Friday, average hourly earnings rose 0.6%
month over month and 4.6% on a yearly basis—the second-fastest pace
since tracking began in 2007. No one’s complaining about bigger
paychecks, but higher labor costs could force businesses to bump up the
prices of goods and services. And a raise is useless if your grocery
bill is increasing at a faster rate.
Some companies are moving ahead with price hikes to offset higher costs.
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FedEx and UPS have raised prices and added new fees to packages.
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Pepsi, which has already been raising prices on its snacks and drinks, signaled it will hike prices again next year.
Sign #2: Soaring energy costs
Some wild stats
from the WSJ: US crude oil is up 64% this year, natural gas prices have
doubled over the past six months, coal prices have hit a record,
heating oil is up 68% this year...the list goes on.
Higher
energy costs are particularly worrying for the economy because you can’t
just decide not to heat your home the same way you can hit pause on the
new TV purchase. Higher energy prices act like a “tax,” the WSJ
explained, limiting how much consumers can spend on other things that
drive economic growth.
Zoom out: 224 of S&P 500 companies mentioned “inflation” on their earnings calls for the second quarter, the highest number on record. Q3 earnings season begins this week; do you think we can top it? —NF
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Southwest
Southwest Airlines’s weekend was as chaotic as its boarding process. It canceled
over 800 flights on Saturday and more than 1,000 yesterday—representing
28% of all flights scheduled for Sunday. Southwest blamed air traffic
control issues, a staffing shortage, and disruptive weather, but no
other airlines seemed to have problems.
- The FAA said in a
statement that yeah, there were a few hours of delays due to staffing
issues...in Jacksonville, FL. But that had been resolved Friday.
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What could be contributing to the cancellations: Southwest runs a point-to-point route network, where a single delay can create an avalanche of other flight disruptions.
Likely not related, but interesting context:
After Southwest decided last week to implement a vaccine mandate,
pilots in Dallas, where Southwest is based, planned a “sickout” to
protest the rule. The pilots union has denied any organized strike, but
did warn the airline that requiring pilots to get vaccinated could lead
to flight disruptions.
Bottom line: The
timing couldn’t be worse for Southwest. People are actively booking
flights for their winter vacations right now, and anyone longing for a
beach wants to stay as far away from the word “cancellation” as
possible.—MM
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Smith Collection/Gado/Getty Images
US authorities arrested
a Navy engineer and his wife after they allegedly tried selling
top-secret information on nuclear submarines to a foreign government.
Key word: tried.
Jonathan and Diana Toebbe, the couple arrested on espionage charges,
sent a package to a foreign country containing Navy documents and
instructions on how to communicate via an encrypted platform, according
to the DOJ. But the package got flagged to the FBI, whose agents then
posed as a foreign official to spy on the spies.
Here are a few interesting details of the investigation, per the court papers.
- An undercover FBI
agent arranged for a “dead drop” of information in West Virginia. Ahead
of the drop, Jonathan Toebbe hid an SD card inside of a peanut butter
sandwich.
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The FBI sent a total of $100,000 in cryptocurrency
to Jonathan, who thought he was getting paid for sharing Navy secrets
with a foreign country (we still don’t know what country he tried to
give the information to).
Why it matters: Nuclear
submarine info like the kind the couple was trying to sell is some of
the most highly sensitive information guarded by the Navy. It was also
at the center of that recent spat involving France and the UK, the US,
and Australia.
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TOGETHER WITH LINCOLN FINANCIAL
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This important message comes to you from the fine folks at Lincoln Financial, who are on a mission to inform people that financial security is about more than just retirement.
That’s why
their suite of products are here to help you live the life you want now,
while also setting yourself up for success in the future.
It all comes down to a few questions. And don’t worry, these aren’t brain teasers:
- What are your goals and responsibilities for the future?
- How can you protect your family?
- How do you find extra money to pay down debt?
- How can you plan for the retirement you want?
Oh, and we should mention: You don’t even necessarily need the answers.
That’s what Lincoln Financial is here for. They have the solutions and tools that can help you make tomorrow financially brighter and more secure.
Get a hold of your financial future with Lincoln Financial here.
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Getty Images
Stat: On
October 7, TSA officers screened 2.06 million people at airport
security checkpoints. On the same day, ridership on New York City
subways was 3.19 million. That means 1.13 million more people rode on the NYC subway that day than flew in the US.
Quote: “Go out there and enjoy Halloween.”
Dr. Fauci gave the green light
to go trick-or-treating this year, given widespread vaccine
availability and most Halloween activities taking place outdoors. He
also said you gotta give out full-sized candy bars this year to
uhh...make up for last year.
Read: Where the suburbs end. (New York Times)
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HBO's Succession. Also what we hear from our CEO every day.
Earnings: The Q3 earnings season, which kicks off
this week, is presented by Supply Chain Issues. Expect companies to
groan about higher costs for everything as they reveal their quarterly
financial performances to investors. JPMorgan starts the party on
Wednesday, followed by other big banks, Delta Air Lines, and Domino’s.
More boosters? Later
this week, an FDA advisory panel will review data for Moderna and
J&J booster shots. Currently, boosters have only been authorized for
Pfizer’s Covid-19 vaccine.
Everything else:
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HBO’s Succession returns for Season 3 on Sunday. Let's go!!!!
- The NHL regular season begins tomorrow.
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William Shatner, 90, will become the oldest person to fly to space when he blasts off in a Blue Origin rocket Wednesday.
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Facebook is introducing new features meant to protect kids, including “nudging” teens away from repeatedly viewing harmful content.
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No Time to Die grossed a solid $56 million at the North American box office this weekend, the fourth-best domestic opening for a Bond film.
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Gyms,
restaurants, and other businesses in Sydney, Australia, welcomed fully
vaccinated customers after nearly four months of lockdown.
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What water restrictions could mean for California’s businesses.
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Sending hackers a-packin’. Trust
Stamp is transforming contactless biometrics to protect your data with
secure digital identities, already earning a $3.92M biometric services
contract with the US federal government. That’s some trusted tech. Invest in the potential of data security’s future here.*
What retail pros need to know about the holidays: Join Retail Brew this Thursday for a virtual event talking about e-commerce and the holidays. RSVP now to hear how execs at Walmart and Shipt are preparing for a shopping season unlike any other.
Dive back into the week:
Shallow dive: New Wonka
Medium dive: The only chicken soup recipe you’ll ever need
Deep dive: A thread on metaverse misconceptions
Cannonball: The Fermi Paradox
*This is sponsored advertising content
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Word Search: If it were a documentary, today’s puzzle would be narrated by David Attenborough. Play it here.
Map Trivia
What do the blue areas of the map below represent?
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Native American reservations | |
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FEATURED BIOGRAPHY
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Eleanor Roosevelt
American diplomat, humanitarian and first lady
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FEATURED EVENT
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1962
Opening of the Second Vatican Council
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| Advertisement |
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SEE ALL BIOS ON THIS DAY
Parents are showing up in droves across
America to confront local school boards over Critical Race Theory being
taught in their children’s classrooms.
Joe Biden just instructed the FBI to arrest parents who speak out in opposition to Critical Race Theory.
But Ron DeSantis sent one message back to Joe Biden and the FBI that has all hell breaking loose.
Click here to read the full story >>
Featured Today
| Axios AM
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By
Mike Allen
·Oct 11, 2021
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 Good Monday morning, and good luck with your run in today's Boston Marathon.
Smart Brevity™ count: 1,166 words ... 4½ minutes. Edited by Zachary Basu.
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1 big thing: Airbnb CEO warns Big Tech
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Photo: "Axios on HBO"
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Airbnb CEO Brian Chesky told me in an interview for "Axios on HBO" that the biggest risk to Big Tech is that "the world is rooting against them." - "They don't think they have society's interest in their favor," said Chesky, whose unicorn startup is based in San Francisco.
We spoke about an hour
outside the city in Marin County, at one of 3,000 treehouses you can
rent on Airbnb, along with igloos, boats, castles — and, in Idaho, a potato. In the wide-ranging interview, I asked Chesky about all the funding that big investors threw at Adam Neumann, the now-disgraced WeWork co-founder and former CEO. - "When I came to Silicon Valley,"
Chesky replied, "there was probably a lack of skepticism about the
whole industry. And that can be helpful to a point — if you live in a
world that's completely skeptical, it's hard for new ideas to be
embraced."
- "But a world of no skepticism can
have some big downsides. I think that the lesson is that ... we have to
be a little more skeptical of things, probably a little bit earlier. "
So how do so many rich people get duped by tech dreamers? - Chesky pointed to the fear of looking stupid: When his company — then called Airbed & Breakfast — was founded
in 2007, "you gave us $150,000, you could have owned 10% of this
company. And a number of people said no. In fact, almost everyone I met
said no."
- "So I think there's this perpetual
culture where people ... completely swing for the fences. They have a
fear of missing out. Maybe they were successful. They pattern-recognize.
They're like: This person reminds me of something else that was
successful. And that can get you in a little bit of trouble if you're
not skeptical enough."
I asked Chesky about discrimination against Black travelers that had plagued the platform. - "Four or five years ago, there was this really concerning hashtag that was trending on Twitter ... #AirbnbWhileBlack," he recalled.
So Airbnb imposed a Community Commitment,
requiring hosts and guests to promise to treat everyone in the Airbnb
community "without judgment or bias," regardless of race, religion,
national origin, ethnicity, disability, sex, gender identity, sexual
orientation or age. - "1.3 million people decided not to do that," Chesky said. "And we kicked them all off the site."
Watch a clip.
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2. Tech is tougher than tobacco
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Illustration: Aïda Amer/Axios
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Critics say Big Tech is having a "Big Tobacco
moment." But reining in tech giants will be even trickier than reducing
the toll of smoking, Axios chief tech correspondent Ina Fried writes from San Francisco. - Big Tobacco was a relatively stationary target, with the giants all producing roughly the same product, and doing so year after year.
- But tech products differ widely, as do the perceived harms.
Between the lines: It took more than a decade to put significant regulation on Big Tobacco, The New York Times notes (subscription). - There are clear parallels, including companies hiding and then downplaying internal research.
- But the case against Facebook and other tech companies is considerably murkier and more debatable.
- And lawmakers face the challenge of crafting limits that won't quickly become obsolete.
Share this story.
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3.  Southwest's mystery meltdown
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Red bars on a flight board at Dallas Love Field yesterday mark a slew of Southwest cancellations. Photo: Julie March/AP
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Southwest canceled more than 1,800+ flights over the weekend, leaving passengers stranded across the country, Michael Mooney and Tasha Tsiaperas report in Axios Dallas, where the airline is based. - 29% of yesterday's flights were canceled, per FlightAware.
Why it matters: The mass cancellations came after pilots asked a federal court to block the COVID vaccine mandate the company imposed last week for all employees. Between the lines: Airline insiders and conservatives wonder if the cancellations are part of a "sick out" in response to the vaccine policy. - Southwest's pilot union said the cancellations weren't part of a planned labor demonstration.
Southwest said the cancellations and delays were caused by "disruptive weather" and air traffic control "issues." - The FAA clapped back: "No FAA air traffic staffing shortages have been reported since Friday."
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A message from Bank of America
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A $1.25B investment in advancing equality and economic opportunity
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The urgency to advance racial equality has only increased this year.
Recognizing the need to do more, Bank of America is accelerating work already underway to better support communities of color with a $1.25 billion commitment over five years.
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4. New data: Flood risk rising
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| Map: First Street Foundation Every dot on this map represents
trouble: It's a critical public facility that's vulnerable to flooding —
airports, fire and police stations, hospitals, schools, libraries, city
halls, museums, and power and sewage plants. - 235,000 of these installations — one out of every four in the country — is in danger of becoming inoperable due to flooding, Axios' Andrew Freedman writes from a First Street Foundation report.
 Search your address on the Flood Factor website ... Read the release.
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5. Mapped: Hispanics' rising power
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Graphic: NBC News' "Meet the Press with Chuck Todd"
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6.  Apple's Hollywood push
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| Rendering: Apple Apple will double its employees in L.A. and Culver City to 3,000 by 2026 in a state-of-the-art, 550,000-square-foot campus, the company tells me. - Two new facilities — connected by a shared wall — will be built along National and Venice boulevards, straddling L.A. and Culver City.
Variety said the investment signals Apple's "major entertainment-industry ambitions." Zoom out: This is part of Apple's commitment in April to spend $430 billion in the U.S. and create 20,000 new U.S. jobs over the next five years.
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7.  New 007 opens strong
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| Lashana Lynch plays 007 in "No Time To Die." Photo: Nicola Dove/Metro Goldwyn Mayer Pictures via AP After 18 months of
pandemic delays, "No Time to Die" — the final James Bond film of the
Daniel Craig era — had an encouraging opening: No. 1 for the weekend,
with $56 million from 4,407 North American theaters. - It's the fourth-best opening in the 25-film series, AP reports.
- Lashana Lynch makes history as the first Black woman to play a 00 agent in the six decades of James Bond movies.
Between the lines: Bond has always had an older audience, which is typically less inclined to rush out for the first weekend. - This is the longest Bond film ever, at 2 hours, 43 minutes.
Zoom out: The N.Y. Times' Brooks Barnes writes:
"[T]he box office is still extremely fragile." But the strong Bond
opening gives "Hollywood its third box office success in the span of a
month," after "Venom: Let There Be Carnage" and "Shang-Chi and the
Legend of the 10 Rings."
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8. What we're watching: "Dopesick"
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| Photo: Antony Platt/Hulu Premiering Wednesday on Hulu: From
executive producer Danny Strong, starring and executive produced by
Michael Keaton ... the 8-episode limited series "Dopesick." - "The series takes viewers
to the epicenter of America's struggle with opioid addiction, from the
boardrooms of Big Pharma, to a distressed Virginia mining community, to
the hallways of the DEA," Hulu says.
"Dopesick" is inspired by the New York Times bestselling book of the same title by Beth Macy, a former Roanoke Times reporter. - The series is shot on location in Virginia, including parts of Appalachia impacted by the crisis, Macy writes on her website.
- Macy says
she wrote "Dopesick" by watching the epidemic throttle three Virginia
communities over two decades — "a heartbreaking trajectory that explains
how the national crisis became so entrenched."
Watch the trailer ... Read the release.
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A message from Bank of America
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It’s clear the private sector must do more
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Bank of America has committed to $1.25B over five years to address the underlying issues that communities of color face.
The company must “help others convene and serve as a catalyst for a
broad-based, collective response to the critical issues affecting our
nation,” said CEO Brian Moynihan. |
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Huntington Beach 
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