Morning Brew Daily - Boeing Backlash Over Alaska Airlines Incident & The Investor-Backed Award Show

Episode Date: January 8, 2024

Episode 230: Neal and Toby discuss the incident where part of a plane door fell off an Alaska Airlines flight and why Boeing is under scrutiny because of it. Plus, the Golden Globes are backed by new investors and Navajo Nation doesn't want human remains on the moon. The guys share their winners of the weekend which include dating apps and the NFL, and why a Russian Oligarch is taking Sotheby's to court. Finally, what we are watching for this week. Listen to Morning Brew Daily Here: https://link.chtbl.com/MBD Watch Morning Brew Daily Here: https://www.youtube.com/@MorningBrewDailyShow Learn more about your ad choices. Visit megaphone.fm/adchoices

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pwc.com slash U.S. slash brew AI. That's pwc.com slash us slash brewaI. Good morning, Brew Daily show. I'm Neil Fryman. And I'm Toby Howell. Today, the Golden Globes kicked off

award season, but just like Billy Eilish, it's wondering, what was I made for? Then why did a gaping hole appear in a recent Alaska air flight? And what the heck is going on with Boeing? It's Monday, January 8th. Let's ride. A lot happened this weekend,

but nothing was more bizarre. then a man in Alabama who crashed his car outside a Bass Pro Shop, took off his clothes, and then cannonballed into the giant aquarium inside the store, after which he was promptly arrested. Toby, did you see this? Yes, I saw it, and I wish I could unsee it, but you know what? Bass Pro Shop is what America was meant to be. Camo, fishing, naked drunk dudes, there we are in a nutshell. But seriously, if you have not seen this, please, this is your final warning.

Do not Google it. Just don't. we cannonball into the show, we have a quick word from our sponsor, Vime. Neal, I want you to think about the early days at the brew. Okay, the WeWork days. I'm there. Imagine how disruptive a cyber attack would have been back then. No amount of free cold brew could have saved us if something bad happened to our data. I can tell you that. Exactly. And that's why Veem is so clutch. It has a multi-layered protection that keeps your data secure and your business running. And it works for enterprise-sized businesses too. So even if you're not in a We-work pounding cold brew, you should

check out Veem. Ah, the good old days. Head to vim.com today to discover more. That's VEEAM.com today. It's time to refresh your yard during spring backyard days at the Home Depot. Get low prices guaranteed on propane grills starting at $179 like the next grill three burner gas grill or get $50 off a select Weber Spirit grill and bring big flavor to your backyard. Then set the scene with Hampton Bay string lights that bring it all together. shop spring backyard days for seven days at the home depot now through may 6th excruison supplies to homedipo dot com slash price match for details our top story of the day will blow your doors off but not in a good way this weekend a clip started circulating online of an alaska airlines flight that

had to make an emergency landing shortly after takeoff because a door plug popped off while the plane was in the air no one was seriously injured on the 177 person flight but the videos documenting the gaping hole in the aircraft were surreal to say the least. Once again, it's a familiar aircraft at the center of the latest controversy, the Boeing 737 Max. The day after the accident happened, the FAA ordered the grounding of all 171 Boeing 737 Max planes with the same door part, and the National Transportation Safety Board has just begun its investigation into the causes of the breach. One major win, the door plug has been found in the backyard of a Portland, Oregon area teacher, which should help determine the cause of the failure.

What is going on with Boeing? Remember, two crashes involving an earlier version of the max killed 346 people back in 2018 and 2019. And now we have doors blowing off mid-flight. This looks like a company that has fostered a culture that puts profits ahead of safety concerns. That is the big question. But to me, the first thing I thought of was this could have been so much worse.

This plane was still climbing. It was at an altitude of 16,000 feet. which is still very high, but not at a cruising altitude of 38,000. People probably still had their seatbelts on. So if this happened at cruising altitude, it's likely that people would not have made it out okay. Meanwhile, this is a door, this is a plug for the emergency exit. And when Boeing sells this plane to airlines, airlines have the choice to put more seats in that row with an emergency exit, Alaska decided not to. so there was nobody sitting right where this door blew off.

So it's just a matter of luck that no one got hurt. I just can't even imagine what it was like being on this plane. This is your worst nightmare. When you get on a plane, you're like, the one thing I don't want to happen is for the windows to be rolled down. Yeah, no, absolutely. The crazy part that I've seen too is that the two people that were supposed to be sitting closest to where the door blew out didn't make their flight.

They missed their flight for whatever reason. So there's this theory going around online right now. It's called the burnt toast theory, which is that minor inconveniences in your life, like burning your toast, are actually potentially protecting you from a worse situation. So someone commented who said, I was supposed to be sitting on that flight. She said that's exactly what happened to me. Something inconvenience happened in my life. I miss my flight, and now I'm so thankful for it.

That is wild. But let's talk about Boeing. So Boeing stock is down 8% this morning. It has had a lot of problems. You mentioned the 737 Max 8. There were two fatal crashes back in 2018 and 2019 that killed hundreds of people. That led to a global grounding of that entire aircraft, and it cost Boeing $20 billion. This new CEO came in Dave Calhoun in 2020.

He's tried to make amends. He's tried to change the culture at Boeing, but there still have been production snags in this latest incident. We don't know whether it's a Boeing problem or a Boeing supplier problem or what happened. if it was just related to this one particular aircraft or the entire aircraft. So we'll see what happens. But it definitely shines a harsh spotlight on Boeing just when it tried to turn itself around and change its culture. Yeah, Boeing's in this rock in a hard place right now because they're in this process of

rebuilding trust, which is a very long process, obviously. But they're also under pressure to ramp up their production and deliver more 737s. Because remember, the airline industry is back and booming right now. So Boeing simultaneously has to ensure and win back. trust while also meeting demand, which is only growing right now. Crazy stat about the 737 Max. This was a 737 Max 9 and the ones that crashed a few years ago were Max 8. But this is Boeing's best-selling plane in history. 76% of its entire order book is 737 Maxes. And when you look at the entire planes being flown this month, 5% of them all

will be 737 maxes. So this is, this plane is like the. the Toyota Camry of the skies. And now for something completely different, the Golden Globes were back last night to kick off Hollywood's award season. In their first showdown since the summer 2023 box office, Oppenheimer bested Barbie with five awards,

including Best Drama, to two. Lily Gladstone became the first indigenous person to win Best Actress in a dramatic film for her role in Killers of the Flower Moon, and she began her speech in the language of Blackfeet Nation, her native tribe. On the TV side, Succession was the big winner, while everyone's favorite emotionally scarred Chicago chefs in the bear took home three awards.

But the most talked about clip of the whole night was probably the death stare Taylor Swift gave host Joe Coy. After his joke about her attending NFL games fell flat, his entire monologue was pretty painful, which he blamed on his writers and the fact that he was only asked to host the show 10 days ago. Still, the Golden Globes happened, and that's somewhat of an achievement since it wasn't clear whether this show would even exist. two years ago. Yeah, remember, the Golden Globes almost went extinct. Two years ago, the LA Times had this bidding investigation that painted the organization as this high flute in place that required studios to kind of wine and dine voters at five-star hotels.

But then they also found out there wasn't a single black voter amidst the 87-person, Hollywood foreign press. NBC refused to air the ceremony that year. And then 2023, the Globes were back, but record low ratings. They were down 26% from the year before. And then also, this show marked the first time that the show is back since the Hollywood foreign press was disbanded. Quite and quietly, they sold to a private equity firm as well as Dick Clark Productions. Now it's got a new voting system, much more international members, 300 international members representing 76 countries.

So it's a new look, Golden Globes. They invite a lot more celebrities. Taylor Swift was there. But, again, I feel like it's hard to overcome a stodgy, bad monologue. which is what we got last night. If you're a private equity firm, do you look at the Golden Globes in? Look, like, this is an interesting asset that I would actually like to buy that could increase in value. Maybe so, because it is maybe a distressed asset, as they would say,

just something that's so down in the dumps. But I think there's so much money and influence behind these award shows that I don't think they're going to stay down forever. I mean, media companies, studios, streamers like Netflix and Apple, all have very much a vested interest in having these award shows be big things. I mean, every year media companies spend $300 million on billboards on these award shows. So I think there's just too much money behind it for these things to go away. There's always going to be someone to push it forward. So I don't think these award shows may come out of zombie mode.

Yeah. And I think the new categories they introduced this year were really smart. They introduced the cinematic and box office achievement award. It means they picked eight films that have reached at least $150 million at the box office against each other. So it's the John Wicks, the Barbies, the Taylor Swift Airs Tours Tours of the world. These are the movies that people actually see, which has always been the knock on award shows, is that they're a little disconnected from reality. So I think that's a good award to add. Barbie ended up winning that award. And then also the best performance in a stand-up

comedy on television, very much like finger on the pole site guy see categories, which I think are going to help them be relevant to normal people. Yeah, but just to get people to watch, you still need a good production. You need moments that will go viral on TikTok, and the only one we had maybe last night was the Taylor Swift one, and Will Ferrell also made a joke about the sushi that was served.

But I think for award shows like the Oscars and the Golden Globes and the Emmys to be relevant in this day and age, it needs to have memeable TikTok-centric moments, and I'm not sure last night had it. I mean, a death stare from Taylor Swift. You don't survive that. That's scary.

The White House held a last, minute meeting to discuss potentially delaying a private mission to the moon, but it wasn't because of an Elon tweet or something Jeff Bezos said on a podcast. This launch was called into question because Navajo Nation, the U.S.'s largest Native American tribe, had some misgivings. The mission named Perrigan Mission One, is a private commercial venture from Pittsburgh-based Astrobotic, and if successful, would mark the first American-made spacecraft landing on the lunar surface since the end of the Apollo program in 1972, along with various sites. science experiments, the mission is carrying human ashes from private companies specializing in

moon burials called Celestis and Elysium Space, and therein lies the issue for the Navajo. According to Navajo Nation President Bu Nygrin, the moon holds a sacred place in Navajo cosmology, and quote, the suggestion of transforming it into a resting place for human remains is deeply disturbing and unacceptable to our people. It also raises the question, who controls the moon? Technically, the FAA clears all domestic launches in the U.S., but their jurisdiction obviously remains on U.S. soil. Celestus's CEO thinks no one and no one religion owns the moon, and quote, if the beliefs of the world's multitude of religions were considered, it's quite likely that no missions would ever be approved. Neil, the mission took off early this morning, so it's already streaking towards its destination, but NASA's increasing reliance on private sector partners to launch payloads to space is only going to cause more of these issues to pop.

up. Totally. I mean, NASA is now basically just a paying customer. It has a few scientific instruments on this flight going to the moon. And it told Navajo Nation, he's like, look, I understand your concerns, but we don't have jurisdiction here. This is just a private company sending something to the moon. And it did acknowledge that these controversies could come up as it offloads more of its space flights to the private sector. This is also a big moment for Vulcan, which is the rocket that took all this stuff to the moon. This is the result of a partnership, a company called the United Launch Alliance, and that's a partnership between Boeing and Lockheed, and they've been so far behind SpaceX. So this is a big moment for them to get their rocket, their new rocket more commercialized.

So this is just a lot going on in this moon-specific mission. Ash's Navajo Nation criticism, big moment for, big moment for NASA's commercialization push and ULA. Yeah, it's just such a new industry. So even though now it's Navajo Nation that has an issue with lunar mission, it may very well be some other group in a few years. Also, this is the second time a U.S. spacecraft has gone on the moon with human remains on board. The last one was in 1998, where NASA actually intentionally crashed a spacecraft in the moon that had the ashes of a famous planetary geologist.

And at that time, officials from Navajo Nation objected as well to it. And so I think this time around, they're like, listen, we already went through this over 20 years, ago and you're telling us that you scheduled another mission with Human Ashes without kind of talking to us first. So I think that was where the major disconnect was. And as you said, these problems are only going to get more common as more of these missions are

launched. All right, Neil, before we jump into the next half of our show, we're going to take a quick break. Wishing you could be there live for the big game, soaking up the atmosphere in the crowd. But too often, life gets busy. Or the price hold you back. Priceline

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It matters where you stay. Hilton, for this day. Welcome to Winners of the Weekend where Toby and I choose two things that had as much fun this weekend as the naked guy who cannonballed into the Bass Pro Shop aquarium. I won the pre-show Connect 4 games, so I will go first. winner of the weekend was dating apps because yesterday the first Sunday of the year is widely recognized as the busiest day of the year for swiping. Tinder says that messages typically jump 22%, likes increase 18%, and the average response time is 19.4 minutes faster than an average Sunday. But why? Why this particular day? Here are a few hypotheses. First is that people making

dating resolutions every year, every new year. So the first Sunday is the day you can actually act on those goals. Many singles are also coming right off a holiday break with your family, who was not shy about asking you why your little brother has a girlfriend and you don't. It's cold, enough said. And finally, Valentine's Day is coming up in just over a month and the thought of a nice romantic dinner may light a fire under your butt to get swiping. So all these factors may conspire to make the first Sunday of the year the Super Bowl for dating apps. It's so interesting because I guess you give people a chance to reflect on what's missing in their lives and that makes them spend more time on the dating apps? I would have thought it almost would have been the opposite where you kind of take stock

and say, all right, maybe these are not the place where I'm going to find a love in my life, but maybe you're just, it's the only place these days for many people. I mean, also, I think the winter has a lot to do with it. In general, January and February are the most, are the busiest months of the year for dating apps. I will just say, these apps need to figure their stuff out because they're not making money. I mean, Bumble, the Whitney Wolf Hurd, who founded Bumble, left the company last year. The stock is down 81% since it went public. And then Tinder is trying to make money any way it can.

It just released a $499 a month subscription to its top 1% of power users. So these companies are scrambling. They can't seem to capitalize on all the traffic on their apps. They just need it to be cold out all the time, and then people will keep swiping. My winner of the weekend is the great American sport of football. Sportigo came out with a report that found the NFL made up 93 of the top 100 broadcast programs last year based on Nielsen ratings. It's further proof that in the age of streaming, the only thing that can consistently drive eyeballs is live sports, especially live sports where people

are hitting each other really hard. Other news that showed football is still King, God, Emperor, all in one. ESPN's 23 Monday night football season was its most watch ever, and Amazon's NFL Thursday night broadcasts were up 24% year over year. What's crazy, though, is that live TV might be on the comeback trail as a whole. Dick Clark's New Year's Rock and Eve hosted by Ryan C. Chris was up 35% in prime time on ABC, technically last year. And the Macy's Thanksgiving Day parade drew a record 28.5 million viewers. Is live TV back? Did football save live TV? Well, you're asking two questions. Is football dominating? Which answers, yes. And are these legacy institutions like the Macy's Thanksgiving Day parade, the award shows that we talked about,

Dick Clark's New Year's Eve, which is now Ryan Seacrest's show, are those coming back in a significant way? It's tough to say whether this is a blip on the radar or maybe a long-term trend back up. But the question to me is, will the NFL ever get to a hundred out of a hundred of the top TV broadcast? This year may be tough because what we saw was the top highest-rated show broadcast that was not the NFL was the state of the union. And when you hear 2024, you hear presidential election. So it's likely that some of the debates or some of the network coverage of the elections might take some spots away from the NFL. But this is just a huge growth.

I mean, it was just five years ago. The NFL accounted for 61 of the top 100, so it's only increased its degemony in just the past five years. Yeah, it will be very interesting in an election year to see how many of those debates or whatnot steal spots. If I'm another sport, though, I'm feeling a little nervous, though, because you can't even crack the top 100, like golf, tennis, all these other sports that are trying to sign

these big television deals as well, and you're not even in the top 100. The NBA was, the highest watch NBA broadcast was 120, game five of the finals. And then the World Series was 140 Game 5 of the World Series. So, you know, maybe the, maybe, it's kind of like golf. Like, you have to handicap yourself against yourself, right? You just, you can't, I'm not going to compete against you when I play golf. I'm going to compete against myself.

So when you talk about basketball, baseball, all the other sports, they just know that they're in a different league than the NFL. and they just have to compete with themselves and make sure they're growing year over year. You'll beat me, Neil. One of these days, you'll get me. Remember the kid who would always do some shady deals at the lunch table in middle school? Well, that kid grew up to be the art dealer,

Eves Bouver, at least according to Russian billionaire Dimitri Ribo Lavlev. Dimitri is taking the fine art auction house Sothebiz to court, saying they have been working with Bouver to secretly mark up the prices of some of the most famous art pieces in the world. The suit alleges that Buver has pretended to be negotiating deals on Dimitri's behalf, when in reality he was actually acting as a dealer and inflating the prices of the pieces he was the owner of by tens of millions of dollars.

One example of this, Bouvier bought a 500-year-old Da Vinci painting for $83 million for some dealer who worked with Sotheby's before turning right around and reselling it to Ribo Lavlev for $127 million shortly after. And according to Rivalovlev, this happened a lot. He accused Bouver of defrauding him in the purchase of 38 works, 12 of which were bought in sales arranged by Sotheby's. So the question is, is Bouvier just a really bad dealer, or did he work with the fine art auction houses like Sotheby's to commit fraud? We're about to get a court case to find out.

Yeah, they're calling this the granddaddy of all art cases because of the masterpieces of the works involved. I mean, there's four art pieces at the center of this case. One of them is this Da Vinci, Salvatore Mundi, which is the highest price, most expensive artwork ever sold at auction. You mentioned that Dimitri paid $127 million for this painting. Well, guess what? He sold it right around to a Saudi prince for $450 million.

And why they're calling this the granddaddy of all is because this is going to shed a light on a very secretive, very shady world of art dealers at the highest level. No one knows what happens in these transactions. It's such in a liquid market. It's so mysterious. Everything happens behind closed doors. And the fact that you're going to get a trial over this in Manhattan with Dimitri Bouvier is not going to be testifying, but you have people from Sotheby's testifying. You're going to really get a light shined on what happens with these back secret deals where money is over $100 million are exchanged for an oil painting on canvas.

Yeah, it makes me want to ask the question, how can you be overcharged on something like art? If he had bought the pictures for the same price at auction, he wouldn't be saying that he feels defrauded or he feels like he overpaid because, again, art is worth whatever you pay for it, right? And so how can you really say that you've been defrauded out of being paid for something that is inherently worth whatever you pay for it? And I do think you mentioned the Da Vinci painting that sold for $450 million. He's trying to say that he got screwed by Bouvert because he bought it for $87 million, then bought it back. for $127 million, but then when he put it up for auction, it sold for $450 million. So who was really getting screwed there? Like, you maybe got a great deal on it.

So it's all opaque. And as you said, this has a ton of intrigue because not only is it a court case about the high art world, but we're also getting a Russian oligarch in a U.S. courtroom, which does not happen maybe very often, but potentially ever. So tons of intrigue around this. Yeah, except the judge ruled that they can't call him an oligarch in the trial because that was demeaning. I was wondering what does make you an oligarch? Is there like a certain threshold of wealth or is there certain threshold of like what industry you get in? Well, he is a fertilizer baron. That's

kind of interesting. Okay, let's preview the week ahead, which is meaty, a lot to chew on. First up, the crypto equivalent of a new Rihanna album, the first spot Bitcoin ETF, could be approved by regulators this week in what would be a watershed moment for Wall Street's embrace of digital tokens. The hype around these funds, which would allow regular investors to gain exposure to Bitcoin without buying it directly, has driven Bitcoin's price 162% higher over the past year, and that approval by regulators could come in a matter of dates. Wall Street is pumped. People who love Bitcoin are pumped, but I think I'd rather get the Rihanna album, honestly, Neil. All right. The world's biggest consumer electronics conference, CES starts tomorrow in Vegas.

If you have a gadget that doesn't include AI, well, you may as well just not show up. Dozens of companies are planning to unveil new products that incorporate AI from cars to PCs and smartphones and probably a bunch of other weird stuff you see every year at CES, like vacuum shoes and toilet paper robots. What you won't see at CES, Apple, which has snubbed the event for years and Open AIs Sam Altman, who was credited with kicking off the AI craze. I'm pretty excited for CES this year. Remember, the only real AI, buzzy hardware we've gotten so far is that pin from Humane, which has kind of fallen short of expectations. and so hopefully we see something that gets us more excited for this new age of hardware in AI. Also today, Congress is back in session after its holiday break, and it faces a familiar problem, agreeing to a spending bill to avoid a government shutdown on January 20th.

This historically unproductive group of lawmakers, which we've talked about, will have to resolve contentious issues of border security and foreign aid. But leaders took a big step yesterday toward preventing a shutdown by striking an agreement to set top-line spending for 2024 at 1.6. trillion dollars. So there is optimism, even as things get more complicated with the nomination contest for president kicking off. Yeah, maybe new speaker of the House, Mike Johnson has a little more oomph than we think, and that top line spending agreement might be passed without more drama. These are ifs and butts, but potentially. Okay, Michigan will take on Washington

in the college football championship tonight. Who you got? I got, it's funny to me, because this is the waste management bowl. It's W. Washington versus M. Michigan. So that's all I can think about. I'm taking Michigan, though. We got to stand by. Morning Brew is started by Michigan people, and I'm just a Big Ten lifer, so got to get the Big Ten winning. National Milk Day is on Thursday. How many of you knew that?

1%? 2%. Fair enough. Okay, Ariana Grande will release a long-awaited new single on Friday called Yes And. It's part of her new album, and this is seven years in the making. Is it an improv album? Yes, and Neil. I would love to hear that album.

Okay. Before Toby makes any other terrible jokes, we have to wrap it up there. Hope you all have a wonderful start to the week. As always, feel free to drop a line at our email Morning Brew Daily at Morningbrew.com. Let's roll the credits. Emily Miliron is our editor and producer. Samantha Velas and Raymond Lue are associate producers. Eugenwa Ogu is our technical director.

Billy Minino is on audio. Congrats on your Golden Globe hair and makeup. Devin Emery is our chief content officer and our show is a production of Morning Brew. Great show today, Neil. Let's run it back tomorrow. All. Pay off your home. Travel for life.

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