Morning Brew Daily - #DeSaster on Twitter, NVIDIA’s Potential Stock Market Record, & A $22.5 Million Ghost Town?!

Episode Date: May 25, 2023

Episode 67: Neal and Toby recap the fiasco that was Florida Gov. Ron DeSantis' official presidential bid on Twitter Spaces. They go over what happened, what were they thinking, and what this could mean for the 2024 election. Then they talk NVIDIA’s track to breaking a stock market record. Meanwhile, Fitch put the US' credit rating on watch for a possible downgrade. Whoa. Finally, a mysterious buyer purchases a ghost town in CA for $22.5 million...could it be a ghost reclaiming its land?? Learn more about our sponsor, Fidelity: https://fidelity.com/stocksbytheslice Listen Here: https://link.chtbl.com/MBD Watch Here: https://www.youtube.com/@MorningBrewDailyShow Learn more about your ad choices. Visit megaphone.fm/adchoices

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pwc.c.com slash U.S. slash brew AI. That's pwc.com slash us slash brew AI. Good morning brew daily show. I am Neil Fryman. And I am Toby Howe. Today on this beautiful spring morning,

we are going to talk about what the heck just happened on Twitter spaces last night when Ron DeSantis announced he was running for president. And we will also explain why there are so many Thai restaurants in the U.S.

Plus, we very well might see Wall Street history today as NVIDIA is on the verge of breaking a stock market record. Then we're all honoring the life of the late Tina Turner today, but no one more so than the Australian Rugby League. Neil, it's Thursday, May 25th. Let's ride.

All right. So it is Thursday of right before Memorial Day weekend. And this is the busiest travel day of the long weekend for air travel, according to AAA. So if you are headed out of town today, please drink a few airport beers for us. I know. I also saw it. Yeah, the FAA is saying there's 51,000 expected flights today. So neither of us are flying, though.

So we're both... I rented a car. Yeah. So I'm going to figure out where to go. But airport Wi-Fi is going to be put to the test. I mean, Boingo hot spot. It is their time to shine. I know.

They actually come through pretty clutch at the time. But I was just thinking there would be so many people working at terminals today that if the Wi-Fi goes down at LaGuardia, just we might have an economic meltdown. I know. You're going to see a lot of people fighting over plugged. space. That's going to be a premium right now. All right. Speaking of meltdowns, let's go to this Twitter Spaces thing last night. So last night, Ron DeSantis announced that he was running for president on this live audio

feature on Twitter called Twitter Spaces. This was a conversation with Elon Musk and tech investor and Musk's buddy, David Sacks. There was so much hype for this, particularly around the idea that this event would be a milestone moment for Musk and taking on Fox chair Rupert Murdoch as the new kingpin of conservative media. It was just unprecedented that a major candidate for president would choose to announce his candidacy on a quite janky social media platform where you can't even see his face

instead of a traditional TV channel like Fox News. And everything that could go wrong, did go wrong, to be honest. Twitter space is bugged out for about a half an hour because Twitter's servers melted down. So they had to close out the first space, open a new one, and only then could Ron DeSantis announce. that he was running for president. He went on to have a long conversation with Musk and Sacks about things like how the mainstream

media sucks, DeSantis's conservative policies in Florida. And then they spent a decent amount talking about Bitcoin and other kind of niche topics. Yeah. Everything you said, everything that I could have gone wrong did go wrong. And everyone was dunking on this. DeSantis and Musk were getting it from all sides. You had President Biden releasing a video kind of poking fun at the fact that the Sandus can't even launch a campaign.

How could he be a good president? I also love they included audio from the space of like that scratchy microphone feedback. So you had Biden weighing in. You had Trump just going ham on truth social, calling him Rob DeSantimonious, which is a hilarious nickname that he's trying to make into a thing. And then you also had Fox News running banners on their website saying, if you actually want to see and hear Ron DeSantis, tune in. to Fox News where he jumped on to also give a little campaign announcement.

And then basically everyone who had any interest in like dunking on Musk too was teeing off. So literally all sides from all different ends of the political spectrum all joined together to just say like this did not go well. But this is a broader picture of in recent weeks there have been a lot of headlines that say that Musk is declaring war on Ruper Burdock and is trying to take over the, you know, the kingpin title from him at Fox by what he's doing at Twitter. And he's turning Twitter into this basically conservative media outlet. Just look at what happened recently. The Daily Wire, which has Ben Shapiro's conservative media company, is moving all of its podcasts from YouTube to Twitter. Obviously,

we had Tucker Carlson move his show after he got fired from Fox to Twitter. And then Musk has reinstated a lot of the other sort of media right-wing media personalities that had been banned under the old regime at Twitter. So there were, you know, a bunch of whispers being like, Musk is coming for Murdoch. Musk is coming for Murdoch. And then this kind of didn't work out. And Fox basically declared war last night and they say, look, DeSantis, you snubbed us and Musk, you're coming for us. And, yeah, we don't like that very much. Yeah, he was definitely, the center of gravity seemed like it was shifting to Twitter, but maybe after last night, it's slowing down a little bit. I also just want to take a step back and say that this was definitely a risk that Ron DeSantis took, obviously launching your

campaign on this untested feature on Twitter is a risk. But like I got shades of Obama 2008 where that campaign run, he really embraced social media as like a way to connect with his audience. And this was DeSantis like trying to do the same thing saying, hey, I'm opening myself up from questions from the audience, even though they never actually got questions from the audience, which I thought was funny. And so, and then you also have. the Musk's sicken fans saying that listen, three million people total came through this space at one

time or the other, which is not a bad number, but it's, people are looking at it with a little grain of skepticism. For comparison, Fox prime time averages 2.09 million people. So you kind of, I don't want to say like it was the, it wasn't smooth and it didn't go off

without a hitch, but also it generated a fair amount of buzz, so I can see why he took this risk. Musk was doing the whole, you know, all presses, good press kind of vibe after. He's like, this is the biggest new story in the world, even if it was all, you know, virtually 99% negative. I would say Taylor Swift and Ice Spice's collab has a claim on the biggest news story in the world yesterday. So do you think this is, like in terms of who this is bad for, I would say, I agree with the analysis that is, this is way worse for DeSantis than Musk. Yeah, I mean, well, Musk.

Musk can do the whole Silicon Valley thing where he's like, Look, I'm moving fast. I'm breaking things. This is a new thing. The fact that we got DeSantis to come on at all instead of Fox was a coup for us. And look, we'll improve it next time. No big deal. I cut 80% of staff.

So obviously we're working pretty lean here. Meanwhile, Desantis had a choice of what to do. And he chose the very untested feature, which even Twitter engineers said was still in beta and that no one was preparing for this particular space. Yeah. I mean, you only get to announce your candidacy once and he's not going to get that one back. All right. Let's move on to Nvidia, Neil.

I tease it at the top of the show, but Nvidia who makes chips for everything from gaming to crypto mining to AI is on the cusp of breaking a stock market record long held by Apple. So, Nvidia's stock jumped 28% in after hours trading yesterday. And if those gains hold when the market opens today, kind of as we're speaking, actually, the company will add $219 billion to its market cap in one day. That would break Apple's. November 2022 record of adding $191 billion to its market cap. And to put that $219 billion number

in perspective, Neal, McDonald's's is $208 billion. So Nvidia's on track to add an entire McDonald's in one day, which is just crazy. And I still haven't even mentioned where this jump is coming from. So yesterday, they reported earnings, and one thing in particular stood out to investors. NVIDIA's Data Center Group reported 4.2 billion in sales versus 3.9 expected. That's a 14% increase. And it's a great sign that customers are using NVIDIA's chips to deploy and train their generative AI applications. There's that magic. I've never heard that word before.

I know. It's magic. And the outlook that CEO Jensen Huang gave that sent the stock to the moon, I'm going to read one quote from him. We're seeing incredible orders to retool the world's data centers. call it a 10-year transition to basically recycle or reclaim the world's data centers and build it out as accelerated computing. And then it goes on to say that most of that workload will be dedicated to, I quote, predominantly generative AI.

So it's a crazy, crazy day for Nvidia. It's a gold rush. It's an AI gold rush. Companies everywhere that are using AI are seeing huge stock market booms. But I've never seen analysts talk about a company the way they're talking about Nvidia after this guidance. I think that's what really sent the stock to the moon was this guidance because they were projected to grow revenue over the next quarter by 7.2 billion.

That was the analyst estimate. And they said we're going to get $11 billion in sales. So it seems like the AI, people aren't just talking about it. They're actually spending money on it. Right. Or spending money on Navidia. And so Navidia is actually the one that's actually monetizing it right now because we've seen Google rollout Bard and Microsoft rollout A.

AI Bing, but the monetization of that is in the future. But Nvidia is the one actually making money from all this hype right now. If we have to retool the entire world's data centers, like, yes, obviously they're going to make some money. I think it's so crazy how this news just steamrolled all other news of the earnings call, because actually, Nvidia's overall sales fell 13% from a year ago, but it's just the guidance that they provided is why people are so bullish. Also, just some other things, just smaller tidbits in the earnings call, is that their gaming division sales fell 38%, which is kind of interesting to me because gaming is seen as this recession-proof thing, like people game no matter what's happening in the economy. But falling 38% does give like a little bit of an

outlook onto what's happening in the broader economic sphere. And then also their automotive division, which is very small still under $300 million in sales, grew 114% year over year. So they're also riding the autonomous and electric car, which needs their chips as well, boom. So, Nvidia just rides every single boom. They're hanging 10 on every wave that we see coming forward. So just a heck of a year and a quarter. When we say big tech going forward, you should think of Nvidia as part of this group. I mean, they're going to probably hit a one trillion dollar market cap soon. And there's only a couple other companies at that threshold right now. You have Apple, Saudi Aramco, Microsoft, bet in Amazon. They're the only companies that are worth more than one trillion right now,

and NVIDIA is looking like it's going to join them soon. Yeah, Fang, put, replace the N in Fang. It used to be Netflix, replace it with Nvidia. Yeah, and video is probably worth like three Netflix's right now. Yeah. So we'll see what happens with them, but they are just absolutely crushing it right now. Let's move on to debt ceiling stuff. The U.S.'s credit rating is on notice. Fitch, which is this big credit rating agency, put the U.S. US's credit on watch for a possible downgrade yesterday because Congress is really taking this debt ceiling debate down to the finish line and there's a chance that the US defaults on our debts as soon as next Thursday. Right now, the U.S. has the highest credit rating possible from Fitch, which is a triple A rating.

That means we're always good to pay back our debts. We're like your friend on Venmo who always sends you money 30 seconds after you send a request. Am I like that? I feel like I wait. You're very, you have great Venmo etiquette. No, you pay very... I have a AAA rating. We should rate people on Venmo. I have a AAA rating. But that is in danger for the U.S. because of what Fitch says is increased political partisanship that is hindering reaching a resolution on the debt ceiling. Basically, all of this bickering in D.C., we may not be the most reliable borrower anymore. And even agreement to raise the debt ceiling now won't change much because this could happen again as long as the debt ceiling exists.

And that was the most important point for me. It's we could reach a agreement on the debt ceiling, but Fitch would still possibly downgrade our debt in the future because the debt ceiling exists and there would always be this risk overhanging us. For sure. Interestingly enough, the U.S. doesn't have a AAA rating across all the credit rating agencies. So Fitch is one, but then S&P is one as well as Moody's. So the S&P already cut the U.S.'s rating back in 2011.

So now actually technically were A-A-plus, which is the second tier. And that number, that rating hasn't changed over the last 13 years. So we're still AA plus. So these things do have long-lasting effects. Like if Fitch decides like, hey, US, you're no longer AAA, then it could last for decades, basically. And the problem with not being AAA is if you have a lower credit rating, then your borrowing costs often go up. Yeah. As we know from, you know, just regular our own credit rating.

Right. It works. Yeah. Literally when you hear the words credit rate, think like you're. credit card rating and how it's credit score. It makes like securing a loan more expensive, similar on the world stage as well. I also did some digging. What are the other AAA credit rating countries from Fitches? It's Australia, Denmark, Germany, Luxembourg actually has a triple rich as anything. I know. And then Singapore as well. So that's not everyone, but this kind of gives you

a sense of where, who the AAA credit ratings are in the world. So, uh, Just looking ahead, what's going on with the debt ceiling, but Fitch says they think a debt ceiling agreement is going to get made. And Kevin McCarthy, the House Speaker, is telling investors not to worry. He's like, we got this under control. We're far apart, but things are moving along. Obviously, the deadline is one week from today. The house is going on recess because of Memorial Day.

I can't believe it. He's sending him home for Memorial Day. Well, most people don't do anything. They're not doing anything. It's like a group of four people that are negotiating. So everyone else is going home for Memorial Day, but he's going to call them back if they reach an agreement. And they have 24 hours to hop on a plane back to D.C.

And vote on a debt ceiling increase, which, you know, I hope happens. But can you imagine just being at your little barbecue? And then getting a call from Kevin being like, we got a book of flight on Google flights, get into Reagan National and vote on this thing. So we don't have an economic meltdown. For sure. All right.

Great first half the show. Before we jump into the next story, we're going to take a quick break. 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.

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All rights reserved. It must provide a recent consumer mobile bill in the name of the person me the deal, additional terms, conditions, and restrictions apply. Neil, yesterday, the singing legend Tina Turner passed away peacefully in her home in Switzerland. She was 83 years old, and boy, were those 83 years impactful.

She's a rock and soul icon. She won 12 Grammys, and lots of people know her songs like The Best and What's Love got to do with it. But what lots of people may not know is that Tina Turner is credited with essentially saving the Australian Rugby League. Through her manager,

who was Australian, Tina partnered with the league to film a series of ads, the most famous of which is set to her song The Best. The goal was to change the image around Australian rugby from this blokey, barbaric sport to make it much cooler, much sexier sport with commercial appeal. Neil, I can't overstate

how much the Australian rugby world loves to the Turner for this. It was funny, I was looking through all of the tributes that were going to Tina yesterday, and you had like Mick Jagger and Cher and Obama and everyone just being like, she meant so much to us. It was so great.

And then you kept strolling and it was like these random Australians being like, I love Tina. Like this, she was such a part of my childhood. Like I associate her with rugby and, you know,

all of this nostalgia. So you just had, you know, she might be more in Australia than anywhere else in the world besides, you know, her hometown or the United States. It's truly wild. It actually reminded me,

reading the story of how it came together reminded me of, the way that Nike landed Michael Jordan. It was like that crazy of a thing. So basically the Australian League was struggling. It was seen as just amateurish. And like it didn't really have any economic prospects going forward. But the Rugby League's CEO's assistant happened to be friends with an Australian rugby league fan living in America who also just happened to be Tina Turner's and actually Olivia Newton-John's manager.

And so that's how the two got connected. And just kind of on a whim, he said, would Tina want to come in and film like an ad for the league? Yeah, because they wanted her to expand her reach outside of the U.S. And rugby was looking for legitimacy, so it was kind of this match made in heaven. I feel like the rugby league got a little bit better of the deal than Tina. But, you know, Australia is a large market, and now they love her there. Yeah, that is good managering from her manager. I also just have some other Tina Turner Fax because, again, she is just a legend. So in 1988, she performed for an audience of 180,000 plus fans in Rio de Janeiro.

That was a Guinness World Record at the time for the largest playing concert audience for a solo artist ever. So 180,000 fans. Taylor Swift could never. I know. Actually, she probably could. Say you would put Taylor Swift on a stage and just an open field. How many people do you think would go? Oh, millions.

The Swifties, they mobilize. And then also, this was a fun fact, too. Tina Turner's the first artist to have a top 40 hit in seven different decades in Britain. And for 2020, the one that got her in was a remix of what's love got to do with it with Kygo, which is this electronic artist. So I just think that speaks to just her lasting appeal. Seven decades. That's crazy right there.

All right, Pete, Tina, your music is amazing. Let's go to Neal's numbers, which is where I share three interesting. that I read from the week's news. The first one is, I have a question, have you ever wondered what the breakdown of Asian restaurants in the United States is? I can't say I have. I actually have, and luckily,

Pew just released a report that looked at the landscape of Asian restaurants in the U.S., and it confirmed that Chinese, Japanese, and Thai restaurants dominate the scene. So 71% of Asian restaurants in the U.S. serve Chinese, Japanese, or Thai food, despite those groups making up

just one third of the Asian population here. Of the big three, unsurprisingly, Chinese food is the clear leader, accounting for 39% of all Asian restaurants. Japan is next with 28%, which is remarkable growth considering that sushi did not exist here until the 1960s. But there was this boom in the 80s and 90s, and do you know why? What was the innovation? The only thing that came to mind was conveyor belts. Oh, you got the first letter right. California roll.

The classic California crab and avocado was a little more. to U.S. consumers than, you know, raw fish. I'm happy it did make inroads because, boy, do I eat a lot of sushi. And then finally, you probably eat a lot of Thai food, which is really curious because Thai food accounts for 11% of all Asian restaurants, despite the Thai population being only 2% of all Asian Americans. And the reason for this is the Thai government. So the Thai government did this thing called culinary diplomacy, where it pushed the opening of

restaurants abroad and it kind of helps a lot of Thai expats help open up restaurants. Interesting. And the whole point of this is, you know, soft power. And, you know, we're probably talking about Thailand more because we eat the food rather than maybe the Philippines or Indonesia, which have much larger populations, but they don't have as many restaurants. They Tina Turner'd America. Tina Turner did it.

All right. Let's move to Argentina, which just released its largest denomination banknote ever, the 2,000 peso bill. Here's the butt. It's worth about $4. And that's because Argentina is suffering from hyperinflation, with prices rising 109% annually in April. People there literally have to carry around stacks of cash to pay for everyday purchases, and banks have had to open new vault space to accommodate more bills to supply ATMs.

Economists there have been pushing for a 10,000-10,000 peso note to make life easier on citizens because you need to drop like 300 bills on the table just to pay for dinner at a restaurant. Yeah, I've seen those pictures. the entire table is covered by money. And yet, tipping there must be a nightmare. It's clear that Argentina's economy needs a little more than a World Cup victory to write the ship. It's expected to tip into a recession later this year. But the federal, the central bank there just jacked up interest rates by 600 bases points to 97% to quality inflation,

which is way more than the interest rates we've had here. Are my final number. So they're two of the most famous races this year, the Monaco, or two of the most famous races, on the calendar, the Monaco Grand Prix and the Indy 500 are happening this Sunday. So I've got a racing stat. Here it goes. New research from scientists in Japan found that Formula One drivers tend to blink at the same place on the track during each lap, which is on straightaways where they aren't changing

speeds. Drivers tend not to blink when accelerating or decelerating or when making turns. So they just pull a Brooks Kepka when they're turning. This is a big finding because people, until now, people were thought to blink at random intervals. but when you're doing an extreme sport like racing, closing your eyes for even one-fifth of a second, which is how long it takes to blink, could lose you valuable information

because humans blink up to 30 times every minute. So when you're traveling at over 200 miles per hour, like a Formula One driver, that could mean you lose over a third of a mile of visual information per minute due to blinking. That is truly a crazy stat. And I also, I hate it. You just made me conscious of my blinking.

Everyone listening to this now is like, Am I blinking? I was like, I am blinking so much, and I'm losing so much visual information. Yeah, so someone needs to do a podcast analysis on YouTube and see how many times we're I wonder if we synchronize our blinking. I know. Oh, gosh, now I'm thinking about it. Neil's blinking for everyone listening.

All right, Neil, thank you for your numbers. Insightful, as always. Our final story today shows that the real estate market is a little livelier than we might think. That's because a literal ghost town just each of... the coach just eat east of the cochella valley in california sold to a mystery buyer under the name ecology mountain holdings for 22.5 million dollars so the ghost town in question is called eagle mountain and it's this former iron mining town that once had a peak population of four thousand people but by the 1980s environmental concerns kind of shut down the ones booming mine and the town became to

fold so one fun fact about this ghost town is actually 14 movies including Christopher Nolan's tenant and Michael Bays, the island, have been filmed at the site, so it is still being used. But Neil, what do you think? Did Ecology Mountain Holdings get a good deal? Sure. I mean, this reminded me of what Walt Disney did.

Because you know what I'm talking about? In Florida, where he created all of these holding companies and bought up all of these properties around and then eventually everyone was, and then he was like, to-da, Disney World. Yeah. So people are like speculating as to who bought this. It doesn't seem like as much of a mystery

as it seems because, so Ecology Mountain Holdings is the company that bought it. And then everyone was like, well, there's also this company named Ecology Transportation Services, which is located in the same California City as this other one. And they have these big red trucks going. That's what they do trucking. And then people have been seeing big red trucks going into this new city. So it's not like the biggest mystery in the world. I hope we get like a random like Disney World Parker.

Now that you got my mind. I would love a little ghost town theme park to spring up. I also did a little bit of research just to quickly end the show about other ghost towns. There's one in St. Elmo, Colorado, that only cost $89,000 to buy. And the reason is, it's because it's located 9,000 feet in the air on a mountain. And it's a four-acre parcel of land. So, but, Neil, if we want to cobble together a couple of Argentinian pesos, I think we could potentially, we could buy this thing and make it a new.

into our new studio. There are a lot of ghost towns up in Colorado because of all the silver mining that left. So I don't know, ghost towns, when I'm on vacation, they don't like particularly interest me. In like Arizona, Colorado, in California, they're like, come see this ghost town. I turn off every once in a house.

I don't know. I'd rather go to maybe a Thai restaurant or something. All right, that is the show for today. If you are traveling, hope you're, you know, listening to this while taking off on a flight or in the airport. Feel free, if you're bored, Just feel free to write in to Morning Brew Daily at Morningbrew.com.

We will definitely read your email and reply if you just want to chat. And we have to give a huge shout out to our crew who makes this possible. Samantha Velas is our head coach. Raymond Lou is the associate producer. Uber Batista is the assistant to the associate producer. Yuchinawa Ogu is our technical director. Billy Benino is on audio. Hair and makeup had 100 shares of Navidia, so they've decided to retire.

As they should. And Devin Emery is our chief content officer. Our show is a production of Morning Brew. Great Saturday, Neil. Let's run it back tomorrow. Yamava Resort and Casino at San Manuel is California's number one entertainment destination for today's superstars. Catch the Jonas Brothers return to the Yamava Theater stage

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