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New jobs data ratchets up pressure on the Fed... August 03, 2024 [View Online]( | [Sign Up]( | [Shop]( [Morning Brew]( PRESENTED BY [Elf Labs]( Good morning. As rumors swirl about who VP Kamala Harris will pick as her running mate, three top contenders—Kentucky Gov. Andy Beshear, Pennsylvania Gov. Josh Shapiro, and Transportation Secretary Pete Buttigieg—canceled some or all of their weekend plans. We are also going to drop out of that 8am HIIT class just in case… —Matty Merritt, Dave Lozo, Molly Liebergall, Abby Rubenstein, Neal Freyman MARKETS Nasdaq 16,776.16 -2.43% S&P 5,346.56 -1.84% Dow 39,737.26 -1.51% 10-Year 3.792% -18.0 bps Bitcoin $62,137.00 -4.78% Intel $21.48 -26.06% Data is provided by *Stock data as of market close, cryptocurrency data as of 6:00pm ET. [Here's what these numbers mean.]( - Markets: Stocks [plunged]( faster than any Olympic diver yesterday as an unexpectedly bleak jobs report had investors second-guessing the Fed’s decision to wait until September to cut interest rates. Intel suffered its worst drop in 50 years and traded at its lowest price since 2013 after it missed on earnings, announced major layoffs, and suspended its dividend.  ECONOMY [Jobs report flop puts pressure on the Fed]( [Jerome Powell]( Harnik/Getty Images July and its scorching temps didn’t just slow your ability to run errands on the weekends: Job growth in the US last month also [simmered]( to a crawl. And with unemployment rising for the fourth straight month, everyone is now looking to the Fed to do something about it—stat. A solid D+: If the labor market had to show the jobs report to its parents, let’s just say yesterday would not have ended in a pizza dinner. The economy only added 114,000 jobs last month, far fewer than the 185,000 economists expected. - Unemployment rose to 4.3% from 4.1%, tripping an alarm for economists known as the Sahm rule that signals a recession is imminent. - But Claudia Sahm (the economist the rule is named after) said that the economy isn’t about to plunge into a recession, as unusual recent conditions have impacted the numbers. The pressure is on for Powell Federal Reserve Chair Jerome Powell said Wednesday, after the latest Fed meeting, that the central bank wasn’t cutting interest rates that day but hinted that its next meeting, in September, might include the chop as long as more data suggested inflation was cooling. But after yesterday’s lackluster jobs report, investors, politicians, and economists are asking, “How much more data do you NEED?”. Some have accused the Fed of moving too slowly on rate cuts. - The Dow slid 900+ points yesterday, while the S&P 500 had its worst reaction to a jobs report since 2022, and the Nasdaq dropped into correction territory. - Sen. Elizabeth Warren, one of the Fed’s loudest critics in DC, [said]( on X yesterday, “Powell needs to cancel his summer vacation and cut rates now—not wait 6 weeks.” Looking ahead…investors are so bullish on a rate cut that you’d think it just walked into their offices wearing a hoodie and bragging about dropping out of college. Citigroup and JPMorgan are predicting half-point cuts in September and November, not just quarter-point cuts.—MM PRESENTED BY ELF LABS [A magical opportunity]( [Elf Labs]( History is being made in the ~$2t entertainment + licensed merchandise market—and you can get a piece of it for a limited time by [investing in Elf Labs](. After 100+ historic trademark victories and 200+ strategic copyright acquisitions, [Elf Labs owns rights to some of the highest-grossing characters of all time]( Cinderella, Snow White, Little Mermaid, and more. The company is now bringing these characters to life with their patented technologies, including AI and compression algorithms, for a never-before-seen level of immersion. Think Disney, but more tech. Elf Labs’ character IP and technology have the potential to define storytelling and merchandising for a new generation of consumers. [Become an Elf Labs shareholder now and disrupt the entertainment and licensing landscape](. WORLD [Tour de headlines](#) [TikTok's California office]Mario Tama/Getty Images The US sued TikTok over alleged child privacy violations. As if the US government didn’t already have more beef with TikTok than the parents of a Sephora teen, the DOJ and the FTC [sued]( TikTok and its parent company, ByteDance, yesterday, claiming that the app unlawfully collected data from users under age 13. The suit alleges that TikTok ran afoul of an earlier legal settlement that required the company to delete data on young users at their parents’ request. The suit comes as TikTok is already facing a law that requires ByteDance to sell off TikTok’s US operations or face a national ban on the app (which the company is challenging in a different court case). Chevron ditches California for Texas. The oil company said yesterday that it’s [relocating]( its headquarters from California to Texas after 145 years in the state to get away from stringent regulations and climate policies. Chevron already has ~7,000 employees in Texas, and the state’s governor welcomed the move with an X post, saying, “Texas is your true home. Drill baby drill.” Chevron’s decision to trade vocal fry for twang comes after other companies, including Tesla and Oracle, have shifted their home bases to Texas, where regulations are lighter and taxes are lower. NFL gets $4.7 billion Sunday Ticket verdict tossed. The NFL scored a touchdown when a California judge agreed to [throw out]( a jury verdict that would have forced the league to pay $4.7 billion to subscribers of its Sunday Ticket bundle—and could have led to the league coughing up three times those damages. The judge found that the damage awards “were not based on the ‘evidence and reasonable inferences’ but instead were more akin to ‘guesswork or speculation,’” finding fault with the expert witnesses from the trial. The decision (which the NFL said it was “grateful” for) is the latest twist in a legal battle that dates back to 2015 over whether the package for watching out-of-market games is anticompetitive. RETAIL [Drug stores locking up toothpaste is good for Amazon]( [Lindsey Nicholson/Getty Images]( Nicholson/Getty Images Your local pharmacy locking up the toiletries is allowing Amazon to lock down new customers. Amazon CEO Andy Jassy [said]( Thursday that brick-and-mortar drug stores taking extreme measures to thwart shoplifting have pushed customers to load up their online shopping carts because they don’t want to ask an employee to unlock a glass case. There’s evidence to back up Jassy’s belief that keeping merchandise under lock and key has hurt IRL stores: - Hundreds of Walgreens, CVS, and Rite Aid locations have closed over the past few years, some of which coincides with when these retailers began believing that Danny Ocean and his crew were coming for their deodorant. - In a Harris Poll from November 2023, 71% of shoppers said glass cases made them less likely to frequent a store. That figure was 89% among Gen Z respondents. - In February 2023, Joe Budano, the CEO of anti-theft technology company Indyme, [told Axios]( that the cases can cause sales to drop between 15% and 25%. Zoom out: Despite this sales bump for Amazon, its Q2 [earnings, announced]( on Thursday, underwhelmed, and its outlook for Q3 fell short of market expectations. Amazon shares finished down 8.8% yesterday, since even if consumers don’t like pressing the button that calls for the pharmacy employee with the key, investors are still willing to hit the panic button.—DL FROM THE CREW [The Crew]( Get Brew merch. What’s better than the Sunday scaries? [Up to 70% off our best-selling Morning Brew merch](. You can snag mugs for $6, the comfiest Brew hoodies for $14, tees for $9, and more. The sale is almost over, so you don’t want to miss out—[rep the Brew today](. SPORTS [This boxing match made J.K. Rowling mad]( [Imane Khelif boxes Angela Carini in Paris]( Pelham/Getty Images Algerian welterweight Imane Khelif (left) achieved one of the fastest wins in Olympic boxing history this week, but some were [outraged]( over how hard she punched in the punching sport. At the 46-second mark, Italian opponent Angela Carini (right) tapped out of the preliminary women’s boxing match on Thursday after sustaining a few hits to the face. When Khelif was named the winner, Carini collapsed to her knees in tears, later [telling]( reporters that she withdrew to “safeguard” her life because she “couldn’t breathe anymore” and had “never been hit with such a powerful punch.” Anti-trans misinformation quickly followed. Countless people who apparently didn’t do a Google search before clicking “Post”—including Elon Musk, J.K. Rowling, [Logan Paul]( Italian Prime Minister Giorgia Meloni, Donald Trump, and JD Vance—falsely claimed that Khelif is trans and characterized her win as a “man” beating up a woman. To be clear: Despite what Joe Rogan [might]( [say]( Khelif is a cisgender female, as the International Olympic Committee’s chief spokesperson [repeated]( yesterday, denouncing the online vitriol. Many people still don’t believe it, in part because Khelif failed a [widely questioned]( “gender eligibility test” last year administered by the International Boxing Association (IBA)…which the IOC banned from the Olympics in 2019 over concerns about the body’s ethics and ties to Russia. Not again: Internet commenters are coming for the other female boxer who the IBA disqualified from the world championships last year, Taiwan’s Lin Yu-ting, who also won her preliminary round match yesterday.—ML STAT [Prime Number: Political donors reach for their wallets](#) [Kamala Harris]Elijah Nouvelage/Getty Images Sometimes it pays to be the new kid on the block. Last month’s [fundraising totals]( for the presidential campaigns are in, and VP Kamala Harris raised $310 million, trouncing former President Donald Trump’s $138.7 million haul. But, much like the influx of coconut memes, a whole lot of that happened right at the beginning of Harris’s campaign, right after President Joe Biden left the race. The VP’s political operation took in more than $200 million the week after Biden stepped aside. Harris’s newly full war chest does appear to reflect a surge in enthusiasm among Democrats as her campaign raised nearly as much in July as Biden’s did in March, April, May, and June combined, according to the New York Times. And though Trump’s number looks small beside Harris’s, it’s still a lot of cash, and it probably would have surpassed the Democrat take if there’d been no candidate switch up. NEWS [What else is brewing](#) - [The US]( is sending warships and fighter jets to the Middle East to help defend Israel from possible attacks by Iran intended to avenge the death of Hamas political leader Ismail Haniyeh. - [Kamala Harris]( has secured enough votes from party delegates to win the Democratic presidential nomination, the DNC said. - [Defense Secretary Lloyd Austin]( revoked the plea deal that would have given Khalid Shaikh Mohammed and two other accused 9/11 plotters life in prison rather than a possible death penalty, the NYT reported. - [NASA]( is considering bringing the astronauts stuck in space because of problems with Boeing’s Starliner rocket back to Earth in a SpaceX vehicle. - [The FDA]( said shortages of Eli Lilly’s popular weight loss and diabetes drugs are over. - [Coca-Cola]( must pay $6 billion in back taxes and interest to the Internal Revenue Service, a federal tax court ruled. Coke is appealing but will pay the bill for now. - At the Olympics…[Sha’Carri Richardson]( won her first Olympic race, qualifying for the 100m semifinals. [The US men’s soccer]( team ended its run in a defeat to Morocco. [Hometown favorite]( Léon Marchand won his fourth gold medal for swimming. RECS [Saturday To-Do List graphic] Listen: A [playlist]( of songs Olympic athletes use to get [hyped up](. Check the price: See how [rents have changed]( in your area. Ponder: Where have all the [great sports movies]( for kids gone? Pack a lunch: Let Wikipedia’s [list of notable sandwiches]( inspire you to put things between bread. Billion-dollar bungle: Maxinomics investigates why Southwest Airlines [has lost so much money]( investing in flight routes around Hawaii. Spend $1 now, save 90% on every fall flight: Get [round-trip flights to Europe]( from $250 to places like Paris and Barcelona. [Try Dollar Flight Club for just $1—offer ends in 12 hours]( *A message from our sponsor. GAMES [The puzzle section](#) Brew crossword: Contrary to popular belief, you should play with your food. [See why in today’s crossword](. Open House Welcome to Open House, the only newsletter section with a little outdoor waiting area in the yard that you’ll have to hang out in until we can get to you. We’ll give you a few facts about a listing and you try to guess the price. [Mansion in Sandy Springs, Georgia.]Zillow Today’s [home]( is in Sandy Springs, Georgia, and has been featured in the Dynasty reboot and the movie Black Adam. The mansion is 17,000 square feet, with a master bedroom spanning an entire floor. Amenities include: - 7 beds, 11 baths - Exquisitely manicured hedges - Many expensive statues to accidentally knock over How much for Chestnut Hall? SHARE THE BREW [Share Morning Brew]( with your friends, acquire free Brew swag, and then acquire more friends as a result of your fresh Brew swag. We’re saying we’ll give you free stuff and more friends if you share a link. One link. Your referral count: 0 [Click to Share]( Or copy & paste your referral link to others: [morningbrew.com/daily/r/?kid=4904f90a]( ANSWER $46.8 million Word of the Day Today’s Word of the Day is: lackluster, meaning “lacking in sheen, brilliance, or vitality.” Thanks to Faye Wetzel from Nashotah, WI, for the not-at-all dull suggestion. Submit another [Word of the Day here](. ✢ A Note From Elf Labs This is a paid advertisement for Elf Labs’ Regulation CF offering. Please read the offering circular at [elflabs.com](. Written by [Neal Freyman]( [Abigail Rubenstein]( [Matty Merritt]( Dave Lozo, and [Molly Liebergall]( Was this email forwarded to you? Sign up [here](. Interested in podcasts? - Check out ours [here]( [ADVERTISE]( // [CAREERS]( // [SHOP]( // [FAQ]( Update your email preferences or unsubscribe [here](. View our privacy policy [here](. Copyright © 2024 Morning Brew. All rights reserved. 22 W 19th St, 4th Floor, New York, NY 10011