Morning Brew Daily - Hollywood Actors Set To Strike & Good Inflation News Sends Markets Soaring

Episode Date: July 13, 2023

Episode 102: Neal and Toby discuss why writers and actors in Hollywood could be striking at the same time for the first time in over 60 years. Plus wages are finally rising faster than inflation as it falls to 3%, and Domino's and Uber Eats are partnering to change the pizza game. Then Neal shares his favorite numbers, which includes Burger King Thailand's 'Real Cheeseburger' which is just... 20 slices of cheese. Finally the largest cruise ship in the entire world is getting ready to set sail and Shopify is letting employees know how much their meetings ACTUALLY cost. 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

Consider this comparison. PWC data found the percentage of CEOs who report revenue gains or cost reductions from AI is almost equal to the percentage who say they're still stuck. What separates these two groups? PWC points to a clarity issue. Even for CEOs, it's hard to tell what's AI hype, what's reality, and where this tech can make a tangible difference. Learn where AI can actually make an impact and what successful adoption looks like at

pwc.com slash US slash brew AI. That's pwc.com slash us slash brew AI. Good morning brew daily show. I'm Neil Fryman. And I'm Toby Howell. On today's pod, Hollywood is at a standstill now that the actors are joining the writers on strike

and we'll take you aboard the icon of the seas, the largest cruise ship in the world. Then we'll dig into the inflation report that dropped yesterday to find out if we can afford eggs again before tossing a quick 15 minutes on the calendar to check in and circle back on how, Shopify's effort to end pointless meetings forever is going. Neil, it's Thursday, July 13th.

Let's ride. Neil, there have been plenty of Neil and not Toby's shows so far this year, but tomorrow you're leaving me for the first time in MBD history. Yes, I'm going to Portland for the weekend for a bachelor party for my dear friend, and I cannot... Portland, Maine. Portland, Maine. Yes, I forgot that there's two. The original Portland, Maine, the OG Portland.

So I'm going to be missing the show. I'm super excited to hear you and Not Toby. I don't know if he's going to switch his name to Not Neal. Oh my gosh. I didn't even think about that. Or is it just going to be Not Toby. But you lived in Portland, Maine, for a year. Yeah.

Which is kind of random. It is random. My review of the city is it's almost exactly what you'd expect. It has fantastic lobster rolls, a very underrated dining scene. It's pretty much just like a hidden gem that it's a city on the come up. So that's what I tell people. Like, is it an absolutely delightful. place, beautiful in the summer, horrible in the winter, everything you'd expect. So I hope you

have a really good time. I'm excited and you guys are going to kill it and I'll be listening, maybe. Let's move on to our first story. So more than 170,000 Hollywood actors, game show hosts, stunt performers, dancers, DJs, puppeteers and other entertainment professionals will go on strike this morning after contract talks failed to reach an agreement with studios by last night's midnight deadline. And in Hollywood, two strikes and your out. With this being the first time that both actors and writers are striking simultaneously since 1960 when Ronald Reagan was president of the Screen Actors Guild, basically all movie and TV production will be shut down. Hollywood is going to be a ghost town besides the picketing.

Like the writers who've been striking for almost three months now, the actors want bigger royalties from streaming and they want to be protected from studios using their likeness to create AI replicas without their consent. Also like the writers, the actors frame this contract negotiation as this existential moment in their profession with streaming and technology upending business models. Yeah, this is obviously not good for Hollywood, but from what I heard, the studios were kind of taken aback by how chunky the actor's demands were. It was a 48-page report, which was, or their demands totaled 48 pages, which was nearly triple the size of their last negotiations in 2020.

So they came with a lot. Because you're right, a lot of things have changed recently. AI introduced a whole new thing. And what I thought was funny, too, is that self-taping auditions were on the docket too, because that was a COVID-era trend where you couldn't audition in person. So you would film yourself auditioning for a role and then send it into a studio. That has continued, even though COVID has receded a little bit. And actors hate it because an in-person audition is a way more compelling.

you can show your stuff much more. And so that's a big sticking point in the docket that I wouldn't think was the sticking point until I read up on it. This is going to be kind of a circus. I mean, you have, I mean, this is Hollywood actors we're talking about. So you have everyone from Matt Damon,

Jennifer Lawrence, Merrill Streep, who are going to be on the picket line joining the writers who are probably super jazzed that the actors are going to lend their star power and publicity to their cause and the fact that they're joining up. now, it's probably causing the studios to sweat because, like you said, I think actors' negotiations

are pretty not tense usually. Like, they usually come to an agreement, and the writers are always a little more contentious. But now that the actors are joining the writers and the actors are, you know, like there's going to be so many photographers there in L.A. and everywhere else, it's going to be, you're going to see this all over the internet with like Matt Damon right next to, you know, some other stunt performer or, you know, maybe someone who did. doesn't get paid as much as him. It is a bunch of very wealthy theater kids teaming up with writers who make the best

picket signs ever because they're the writers for TV shows. So this is like the ultimate apex of picketing, in my opinion. But this union does have a lot more people than just the A-list actors. There's the game show host there. It's just like everyone else who makes Hollywood, Hollywood tick, including Donald Trump was in this union. The actors union? Yeah.

Oh, my. my God. When he was hosting the apprentice. Oh, yeah, I guess he. And they kicked him out after he incited an insurrection. Fair enough. There's also just to zoom out a little bit. There's kind of this resurgent labor movement going on, especially in California.

Hotel workers, school bus drivers, teachers, and cafeteria staff have all gone on strike for some period of time during the last few months. So it definitely is, and it kind of dovetails nicely with our next story, but there is this resurgence of, like, workers. and unions having more power. So this is, obviously we're talking about it because it's A-List Hollywood actors, but also this is just something that's going on across the country right now. Yeah, but this is going to affect, I know it's A-List actors,

but 170,000 people not working is going to have ripple effects across the economy. During the writer's strike, we know that California, the previous writer's strike over a decade ago, we know that California lost, you know, a couple billion dollars because of all of the ripple effects of, you know, set workers, not being able to produce anything. When there's no production, there's no catering services. There's none of these, you know, people go into lunch at these various places since they're not going to work.

So it's going to be pretty devastating. Also, just a tie bow on this. The Emmy nominations came out yesterday amid all of the writer strike and the actor strike. HBO dominated, succession led with 27 Emmy Noms, followed by The Last of Us and then White Lotus. So HBO, just racking it up. But the actors are not allowed to do any promoting. emotional events as part of this strike. So the Emmys are probably going to get pushed to next year.

They're slated for the fall, but none of this is going to happen until next year. I should probably watch that succession show, shouldn't I? All right, Neil, for this next story, I want you to slow down, ease into the right lane and slap on your blinker. That's because we might have reached a turning point in the fight against inflation. Inflation has cooled off significantly in the past few months, and yesterday's report brought some good vibes. Inflation is now sitting at just 3%, which is good for a two-year low. And core inflation, which strips out volatile food and energy prices, rose only 0.2% on a monthly

basis, which is also the slowest pace in two years. Now it's tempting to just keep that blinker on, Neil, and go for a victory lap. Yes, I'm extending this metaphor. But it's probably a little too early for that. One good CPI report is not going to hold much sway with the Fed. plus inflation is still hovering above the Fed's 2% target, so we still have a little ways to go. But all things considered, a pretty solid inflation report with a couple of idiosyncrasies here and there. Take us under the hood, the CPI hood, Neil, any specific sectors or numbers that stood out to you? Well, you said hood, so I think I have to start here. Motor vehicle repair prices are up 20% year over year.

And this is a thing that I was looking into. Getting your car repaired right now is absolutely brutal. Not only is it super expensive because of labor shortages and part shortages, but wait times are so long as well. And we kind of brag about how we don't have cars on this show because we live in New York. But it sounds like it's not a fun situation. And it's because cars on the road are so old. They're oldest than they've ever been. They're 12.5 years on the road, which is, yeah, a record age.

And so people need a lot more repairs. And it's just causing bottlenecks. So that stood out to me. Men's pants and shorts up 8.3% also stood out to me as someone who buys men's pairs and shorts. I'm going to blame Lulu Lemon on this for sure. Absolutely. Yeah, under this test, we were both wearing men's pants and shorts. So I would hope so. It is close to. I don't know about you, but I am. And then the biggest one is obviously rents are still going up. This rent of primary residence was up 8.3%. That is boosting the entire inflation report because rents make up such a part of it. You know, private sector reports like from Zillow and apartment list and all these other companies are showing that rents are actually deflating. The government data doesn't show that yet,

but it's expected to in the coming months to show that rents are actually finally coming down. So this might be a bit of a lagging indicator. But yes, rents are still going up and they're causing the broader CPI to rise. And then a few things that are kind of pushing it down is gas prices are down 27%, which again, It's a little bit of a misdirection because it's being compared to last year's data, which is right when the Ukraine War broke out, which sent fuel prices skyrocketing because no one knew how the supply chain would work out now that Russia was involved in this war. So gas is down 27%. TV prices decreased 10%, which is nice.

TVs are cheap. Yeah, they are cheap. You can get a really good TV for very, you know, not a lot of money at all. And then also airline fares dropped 19%, which thank goodness, you guys, I'm entering wedding season. It's becoming wedding season for a lot of people. And that's a full-time side job, honestly, wedding season and flying all of them. And then I also do want to zoom in on some of the places where inflation maybe isn't cooling off. So MarketWatch did a breakdown of which areas of the country still have high rates of inflation.

And wouldn't you know it? But the Tampa Bay area, my hometown, is where inflation is still the high. highest in the country. So the St. Pete, Tampa, Clearwater area is currently sitting at 7.3% inflation. It's because the raise are so good and everyone's going to the games and buying up and pushing up ticket prices. Yeah, okay. And then the second place is also shout out Sam, who's from the Miami area. Miami, Fort Lauderdale, West Palm Beach area is sitting at 6.9%. Again, it's driven by super high housing costs. A lot of people are moving, moving to Florida. It's Florida and then the whole West Coast basically. So you got Colorado,

Phoenix, Seattle, but Florida is just absolutely ripping in terms of inflation still. I mean, when I was in St. Pete, everyone was moving there. Everyone was complaining that the airport was too small in Tampa. Tampa's a good airport. One of the quickest in the world. Right. You've mentioned it before. You said it's great.

But overall, yes, this is a good inflation report. It probably won't stop the Fed from hiking rates later this month. But, and I'll say, that could be the last in this entire huge rate hiking campaign that brought down inflation because we have 2% in our sites. Right. I think put some respect on Jerome Powell's name. Like he kind of got us there at the end of the day. So, yeah.

Not there yet. Not there yet. Respect coming after we get to that 2%. All right, Neil, let's move on. You thought I was done with the driving metaphor to introduce stories wrong. Get back in your car for me, okay, and pretend you are leading growth for Domino's Pizza. Now, I want you to make a giant U-turn on your long-held status. against working with food delivery companies.

I'm so confused. Hope your seatbelt was on when you did all that. But yes, Neil, the world's largest pizza chain signed a deal with Uber yesterday to list its menus on the Eats and Postmates food delivery apps in 28 different markets. This is a big switchup because Domino's has long been vocally opposed to working with companies like Uber Eats because they didn't want to relinquish control over their deliveries or do any sort of profit sharing with them. but now as growth has stalled a little bit,

Domino's is looking to squeeze a little more garlic from its bread. Doing this is definitely a bit of a deal with the devil, but given same store deliveries have been declining for Domino's, they had to look for growth opportunities somewhere. Yeah, got to be your customer where they are. And first of all, that was an 11 out of 10 intro, I have to say. But yes, as you said, Domino's delivery sales are declining.

In the first three months of the year, they were down 2%. Meanwhile, the apps, Uber DoorDash, other third party marketplaces, they accounted, their market share for pizza has grown so much over the course of the pandemic. Before the pandemic, it was just 4% of pizza sales these apps accounted for. Now it's 14%. So if you're a Domino's executive, you're looking at, okay, our app is declining and all of those other apps are booming in terms of pizza sales. Like, I don't know, I know we've been opposed to this for so long, but we don't have a choice here. It's very much like Netflix doing a U-turn on its ad. Right, right.

No, you're totally right. I do think it's a bit of a bummer for Domino's brands because Domino goes hard on their delivery app. There's so many different ways that they can deliver you a pizza, and also, like, they have the pizza tracker. You can still use, this is the most important thing. We should have led with this. You can still use pizza tracker. You can still use pizza tracker, but it is a bummer because, yeah, they were very protected. over their delivery experience, and now you're not going to get that with Uber Eats.

I mean, technically, Uber Eats has its own form of delivery tracker, but it doesn't have the character, and I'm pretty sure Domino's has trademarked their pizza tracker. So, and yeah, just a few years ago, they were running ads, offering free food to customers who use their ordering system as kind of like this big, we are against these apps. Yeah. So it's a bit of a bummer, but yeah, growth has stalled. It's also just like a TAM play. They're increasing their target audience.

And apparently they chose Uber because Uber Eats customers are younger and wealthier. So it's a new audience. It's a new customer base to tap. It makes sense. I understand why they didn't do it for a while, but it's time Domino's. Yeah. And I'm a big Domino's guy. I think people sleep on Domino's.

Good quality. It's the largest pizza chain in the world. I don't know if anyone sleeps on it. Fair enough. All right, Neil, 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 to 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. Exclusion supplies to homedipo.com slash price match for details. 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 on April 30th, the powerful vocals of Demi Lovato on May 17th and the signature Southern Country Rock of Eric Church on July 19th. Tickets on sale now at Yamava Theater.com, only at Yamava Resort and Casino, celebrating its 40th

anniversary. You win? Must be 21 to enter. All right, let's go into Neal's numbers. Three stats from the week's news that will shock you, delight you, and make you lose your appetite by the time we're done. That I can guarantee up first. So the phrase of the summer, and it might end up being Miriam Webster's word of the year, is Barbenheimer, which describes the activity of seeing Barbie and Oppenheimer back to back when they come out next Friday. Well, unlike quiet quitting, this buzzword seems to actually be happening in real life. AMC, the world's largest movie chain, said this week that more than 20,000 of its AMC Stubbs members, have booked Barbie and Oppenheimer on the same day as a double bill.

Then, UK theater chain views said that 19% of people who booked tickets to Oppenheimer also bought tickets to Barbie as a pallet cleanser. This could be a monumental day in the history of cinema, maybe up there with the release of Citizen Kane. It is crazy that, I mean, we joked about it, but having actual hard data to go along with it, really, I love this for people. Because 20,000 of just AMC stub members means that's just a, snapshot of a certain sampling.

That means more people are doing it. So I say we go for it. An Alamo Draft House, which is the U.S. theater chain, said that a bunch of private parties are booked the double bill. So for, you know, corporations doing a little happy hour thing. Corporate retreat to go see Barbenheimer birthday party. Oh my God. So that's been interesting.

But I have a question for you. If you were a theater chain putting on a double bill like back-to-back movies, which two would you do and which order would you put it in? Okay, so I actually have a couple listed because I was thinking about this before the show. I would do Lord of the Rings Fellowship of the Ring and elf. They both involve epic journeys, one through Mordor, one through the candy cane forest, both have really hot elves, Legalis and Will Ferrell as elf. Perfect double feature. I would also do School of Rock and Whiplash, which is about two. That one is a good answer. Two talented musicians giving everything to achieve their dreams no matter what the cost.

And then finally, I would do Groundhog Day and then Groundhog Day and then Groundhog Day and then Groundhog Day and then First Days and then Groundhog Day and then Groundhog. He's leaving the set. He's getting out of there. But those are my double and triple features. Yeah. They should do this. Capitalize on Barbenheimer and take Toby's idea.

Those were excellent answers. Let's move on to our second number. The oldest craft brewery in America is liquidating. I'm sorry. Anyway, Anchor Brewery. is shutting down after a hundred and twenty seven years in operation. The San Francisco based company cited challenging economic factors and declining sales since 2016 for halting operations. This is a disappointing ending for what was America's

first craft brewery when it opened its doors in 1896, but neglect by parent company Sapporo, along with broader challenges facing the craft beer market, tank the business. Production of Anchors beer has fallen every single year since Sapporo bought the company except for 2021. Sad to see a proud American brand bite the dust like this. I know. And I'm actually sad, too, because I like Sapporo a lot, too. It's a Japanese beer, which is pretty solid, too. Yeah, craft beer has just come up against it recently. Like, the Seltzer market has kind of eaten into it. And yeah, it's just like a tough time. I was reading up, and the craft beer people are super pissed at the certain tax breaks or things

that the government has done to boost liquor sales. And meanwhile, they think they're handicapped. craft beer market, which has really ballooned, I would say, in like the early 2010s, late 2000s where it was like Froyo. I mean, there was a craft, there was a brewery on every street corner, and it was seen by some cities as a way to like revitalize their urban cores. Speaking of Portland, I mean, is the biggest example of this. And I think they've kept the, they kept the, you know, craft brewery vibes alive. There are so many there.

I think we're going to do a tour to Alagash. Main beer co. Main beer co. Yeah, you'll have to tell me. But anyway, yes, craft brewery, craft beer is just having a rough go. I think sales are down 4% year-to-date and volume is down more than 7%. So it's not just Bud Light. It's these super-hoppy beers that everyone pretended that they liked, but they don't actually like.

That's the thing. All right. Let's move on to the final meals number. We've been using the word cheeseburger all wrong. It's not a burger that you top with cheese. It's where the cheese is the burger. It's just a bun and cheese. Burger King is making this case with what it's called, what it's calling, the real cheeseburger,

a limited edition menu item in Thailand. This sandwich, and it is real, you can order it, is simply just 20 slices of American cheese stacked on one another in between two buns. That's it. Not melted cheese, just cold American cheese stacked on top of one. It is so foul. I can't even begin to describe how gross. gross 20 pieces. And I'm not an American cheese hater because it is, it's great melting ability.

It's good on burgers, but 20 pieces stacked on top of each other. I'm out. Sorry, Thailand. Sorry, Burger King. It looks okay when you see it just the bun, you know, fully with the cheese. And then when they do a cross section, you just see how tall it is. And you're like, I can't fit that in my mouth. Don't normalize this. Melted. But apparently there's this trend in Thailand where you put cheese on everything. I am a big American cheese guy. I would eat, like, what's What's the maximum amount of American cheese slices you would eat on this? There's nothing more than one. I'm serious.

Nothing more than one. They put two on a bacon egg and cheese. I know. When it's on a burger, it's fine. But just American cheese alone, too plastic-y. You should go. Everyone should go look this up because it is wild. There's no way it's good.

All right, we have to move on. Yesterday, if you remember, we were debating whether we are living in the Anthropocene, a new era, or epoch, I should say, defined by humans' impact on the world. and I am ready to call it. We are here. This year we've already built the sphere in Las Vegas, the world's largest spherical structure. And next year, we're going to release the icon of the seas, the world's biggest cruise ship. Photos of Royal Caribbean's newest ship sent the internet into a frenzy this week. I'm not sure there was any news relating to this ship at all, any updates, but it seems that people just saw the pictures for the first time of the icon of the seas and were absolutely flabbergasted

because this thing is gigantic. It is five times larger and heavier than the Titanic. It's got 20 decks, more than 20 restaurants and bars and seven pools, and it can carry up to almost 8,000 people, more than 5,600 guests and a crew of 2,350. It sounds, I'm a cruise, truther. It sounds super fun. And people want this thing.

When Royal Caribbean put tickets on sale for the icon on the seas, which start at $1,500, It had its largest booking day ever in its entire history. So people were absolutely fiending for it. And then also the cruise industry is just so back. So after the 15-month pandemic shutdown, it's come back bigger and better than ever. Next year, 36 million people are expected to go on vacation on cruises. That's up from 29.7 million in 2019, which is pre-pendemic.

So we're back and better than ever. And then also, Royal Caribbean is one of the best performing stocks of the year. it's up 103% year to date, only outdone by Carnival Cruises, which is up 128% year to date. Because investors are looking at that, and they're just like, that is a money-making machine. 8,000 people to fit on that thing, just having the time of their lives, maybe, maybe half of them are saying, get me off this thing. I'm not a cruise guy, but still, I can appreciate the humanities genius by making this thing. You have to take a look at, what did you, Chenna in the control room saying?

It was like a Bratz doll cruise ship that they would actually sell you made into real life. We're getting a Barbieheimer cruise ship sometime in the next 10 years and I'm going to be here for it. It's like, yeah, it has that like bubble gum color and it's all like put together walkable urbanism so all of the city planners can get behind. No cars needed. This thing is beautiful. It may pollute a lot, you know, but we're just going to not think about that right now. Anthropocene, baby. All right, Neil, on to our last story.

And I want you to get back in your car. I'm kidding. We're done with that one. Okay, our last story centers on the popular maxim we've all heard. Time is money. So the e-commerce company Shopify is taking that literally and rolling out a calendar feature that assigns a dollar value to every meeting. It uses approximate salaries to figure out just how much money that Monday morning check-in

is costing the company. All of this is part of its broader effort to cut down on unnecessary meetings at the company to hopefully increase productivity. Earlier this year, it eliminated all recurring meetings with more than two people and says it's on pace to cut out 322,000 hours of meetings this year. Neil, what do you think about this move to shame employees? I'm cynical about this. This is a ploy by executives to not have any of the underlings put meetings on their calendar.

Someone should calculate the money it took for someone to actually make this tool. It was they did it during a company hackathon. and it was the C.O. who came up with it, which is an exec. Exects love banning meetings because, yeah, they think, I mean, they don't want to be there. They want to have meetings on their own terms. And if someone puts a meeting on their calendar, they're like, you know, they get all angry. So doing this is definitely going to dissuade younger people who might actually need something from them. Right.

So I don't know. I'm skeptical. I think Shopify's, like, riding this PR train right now with media companies absolutely love it. their anti-meeting agenda. To me, the biggest problem is that Shopify is a remote company. A lot of people are remote first. And if you ban meetings, you lose pretty much most human interaction on a daily basis. And so even though meetings might not be the best thing for the bottom line productivity, the fact that just talking to someone, that helps.

It helps increase company morale. So I think it's a little short-sighted and a little too bottom-line. I think we, I can't believe we're coming out in favor of meetings. I know. It might be the only two people in the world. But it can definitely get out of hand, so I completely understand this. But you're right. For remote people, I mean, my team is semi-remote, and I hold a meeting every week.

And we just, I don't have like a major agenda, but the whole point is just talk to each other, get some face time. So that's what I do every Thursday at 11. And I'm like, all right, we have a few things to talk about. But mostly, let's just meet and catch up. Because in a remote world, that's really important. Or remote workers might feel like I'm logging on and I'm just kind of staring at. my computer and then I log off. I'm not feeling so much connection. Yeah. All right. That is our show. Toby, I'm excited for you to take the reins tomorrow. Don't forget fast week, slow week.

Don't forget to make a hair and makeup joke. Okay. True. Okay. Send me all these notes. Yeah. If you want to send us a note, our email address is Morningbrewdaily at Morningbrew.com. Let's roll these credits for our amazing crew. Emily Milliron is the editor and producer. Samantha Velas and Raymond Lou are the associate producers. Yuchinawa Ogu is our technical director. Billy Minino is on audio. Hair and makeup is coming with me to Portland, so this YouTube video could look pretty rough tomorrow. 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 on Monday when you're back.

Relax and let Ralph's delivery handle your grocery shopping this week. We start with only the freshest items, then review your list and carefully choose each one. Then we pack it all up and deliver it in as little as 30 minutes. So you can feel confident it's what you ordered. Fresh groceries, your way, with Ralph's delivery and pickup. Get free delivery during online deal days, plus $30 off your first online order. Ralph's, fresh for everyone.