Morning Brew Daily - The Bitcoin ETF Is Here & OpenAI Opens a GPT Store

Episode Date: January 11, 2024

Episode 233: Neal and Toby discuss the SEC approving rule changes paving the way for Bitcoin ETFs and why OpenAI is opening a store for custom GPT chatbots. Plus, scientists find about a quarter of a million pieces of nanoplastic in water bottles. Neal shares his favorite numbers and how is the snow shortage impacting businesses around the globe? Finally, Girl Scout Cookie season is so back. 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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at pwc.c.com slash U.S. 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. Today, OpenAI is opening up a store.

So get in losers. We're going shopping. Then where the heck has all the snow gone this winter and is it ever coming back? It's Thursday, January 11th. Let's ride. If any high school age kids or parents of high schoolers

are listening to the show this morning, I have some fast. about college admissions that will blow your mind. A new peer-reviewed study found that legalized weed is a huge factor in where kids are deciding to go to college these days. In the year that a state legalized recreational weed, the number of application for that state's colleges grew 5.5% more than colleges in states that did not legalize. And if we want to zoom in on the largest schools, applications jumped nearly 54% compared with similarly sized schools. in non-legal states. So if your kid says, I'm really digging what Coach Prime is doing at the

University of Colorado these days, just know there might be an ulterior motive. This is hilarious. This adds to the body of research that shows that maybe external factors kind of contribute to a rise in applications. There are studies that show that schools that do well in sporting competitions, maybe St. Peters goes deep into March Madness one year. That generates publicity and interest around schools, and you'll see applications go up, which is great because because then your admissions rate can go down. You rank higher, and everything's great for you. Before we jump into the show today, we have a quick word from our sponsor, VIM.

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Nobody panic but the spot Bitcoin ETFs that we've been hearing about and hearing about finally got approved by the SEC yesterday. All 11 that applied for approval got the green stamp from the regulatory agency, including BlackRock, the biggest ETF issuer on Earth. This is a monumental day, or a little anticlimactic, depending on your perspective. Monumental because it opens up Bitcoin to a whole new audience of everyday investors who can now get exposure to the asset without actually owning it. A little anticlimactic because we got that pump fake two days ago when the SEC's Twitter account was hacked.

The path towards this day was a long and winding one. Multiple asset managers applied for Bitcoin EPS in the past, dating all the way back to 2013, but the SEC continually rejected them thinking there would be too vulnerable to market manipulation. But in August last year, a court found the SEC was wrong to reject a company called Gray Scales Bitcoin ETF application, which made the agency rethink its position. And now here we are. Neil, we've been talking about this for so long, and the price of Bitcoin has been running for so long, up 160% in the last year. And now you or I or anyone listening to this can head to their normal stock brokerage account

and maybe buy this thing as early as today. Right. Let's talk about why this is a big deal, how it opens up access. So, ETFs are types of index funds that track a basket of security. So if you go into your 401k retirement fund right now, you're probably going to see under the hood that it's just a bunch of ETFs tracking everything from the S&P 500. That is, of course, the most popular one, the NASDAQ 100. There are other ones that track specific stocks in specific industry, so you could get a space

ETF or a marijuana ETF or one that tracks Nancy Pelosi's trades if you think she is a great trader, which apparently she is. So this is just another one that would track Bitcoin. And until now, you have to kind of download Bitcoin crypto-native applications like Coinbase of the world. Robin Hood started doing it a little bit too. But you kind of had to have a separate wallet, quote unquote, to be able to get exposure to Bitcoin.

Now you can go into Schwab, e-trade, any of these traditional broker. brokerages, and now invest in Bitcoin, if that is something you want to do. Yeah, in a single sentence, just to sum it all up, the ETF makes it easier to add to your portfolio and a lot easier for the everyday investor who doesn't want to go down that kind of crypto rabbit hole. I want to talk a little bit about the fee war that is broken out, because the way that these ETF issuers make money off ETS is they charge a small fee. The industry standard for other U.S. ETF products is around 0.54%. The fees coming in for these Bitcoin ETF, some of them are as low as 0.2%. We're seeing kind of this fee battle

going on, I think, in anticipation of trying to gather inflows when they first became approved. And so we're seeing like this almost race to zero to try to attract and have the lowest fees out there. It reminds me of the New York City rental market in May 2020 when all these landlords were slashing prices and they're saying, hey, we'll give you a full year free, a six months free, You don't have to waive the broker fee. But it does seem like Kathy Woods, Ark Invest, who is one of these Bitcoin ETF issuers, said, you get six months free and a bunch of others have followed. So there does seem to be a race to the bottom because there is an expected inflow of billions of dollars when they start trading today.

And each of these ETFs, it's a very competitive market. They want to be the ones that capture all that money coming in. Right. Absolutely. Crypto advocates are very happy right now because they think that this shows that the gap between the traditional finance world and the world of crypto is narrowing. Crypto non-advocates, crypto-haters are saying that this is just putting a stamp of approval on an industry that's still rife with all this fraud and these scams and the downfall of

FTX. Now we're suddenly approving Bitcoin ETF. So there's definitely going to be people on either side of this that say this is a monumental day for different reasons, but it is a monumental day. And there are those of us who say, wait a second, this is the merging of the traditional financial system with Bitcoin, which is created to subvert and go around the traditional financial system. So there are those of us who may say, hey, Bitcoin, crypto people, I thought this is exactly what you wanted to avoid. The whole point was to kind of skirt the traditional financial

system, and now you're becoming enmeshed even more. So that is an interesting thing. And I think Bitcoin is kind of having an existential crisis. I mean, what is it? What is it for? It still hasn't proven itself to be anything more, I would say, than digital gold. That is, that seems to be the use case at this point, because I haven't bought anything with Bitcoin. It needs some therapies, having that existential midlife crisis. All right, what if you fired up chat GPT, and instead of asking questions to a jack-of-all trades, you got a personal audience with the absolute expert in their field. If you wanted cooking tips, you could chat with Julia Child.

If you wanted to learn how to coach college football, you could chat with Nick Sabin, who has a lot more time on his hands now. That is what OpenAI is trying to do with its latest product launch. Yesterday, the chat GPT maker opened up a store where developers and regular people alike can share what's known as custom GPs or chatbots that are trained to become masters of a specific domain like recommending books or teaching math or searching through scientific papers and therefore are more useful to people than just vanilla chat GPT. Think of this like the App Store meets YouTube in that OpenAI is trying to become a platform that attracts people and creators to build cool new things on top of the technology. it's already released, generating more users in the process. Not everyone can enter the GPD store, though. For now, it's only available to customers who pay $20 a month for a subscription to chat GPT

Plus, but it's a sign that OpenAI is putting last year's leadership boondoggle behind it and rapidly releasing new offerings to put distance between it and the other big tech rivals that are trying to compete in the AI space. Yeah, remember, this was actually one of those things that kind of caused the Rift at Open AI to begin with. The store was initially set to launch back in November, but was delayed amidst all the Sam Altman board drama. The board thought Sam was potentially racing to commercialize chat, GPT, a little too quickly. But now we're seeing kind of that vision fully fledged out here.

There is still some murkiness on exactly how Open AI is going to profit off the store, because they do say that they promise to do a revenue share with the creators on the store, but they're not taking that 30% fee that the App, Apple's App Store, and the Google Play Store have been known for. So there's still some murkiness around exactly how they plan to monetize and how they plan to reward creators. Just know that they are going to reward creators. That's why I said this is very much like YouTube because they're trying to attract people to the platform to build on top of it. And they're going to give out a rev share. I think the way they think they're going to make money is through this subscription of $20 a month, chat GPT Plus. The only way you can access the store in all of these.

different custom apps is through the subscription. So maybe people like you and me, we only use the free ChatGBTGBT.T version. Say we want to access some of these apps or some of these different things that ChatchipT is doing. We'll pony up the $20 a month. And I think that is sort of the long game to get a lot of people who use ChatGPD, 100 million users, to convert some of them to paying subscribers. Yeah, make it pay to play. I do think this is what could potentially differentiate Open AI even more. So I know they were first to it, but now, like, Lama from Meta, Gemini from Google, their chatbots have kind of risen to a point that it's on par with Open AI. So this is one way that Open AI can create kind of like a network effect and create a moat

in a way that some people have been skeptical that they could pull off. I just want to mention a few of the custom GPTs. Say somebody's listening to this, they want to go to the store. Like what kind of, it may seem a little nebulous, like what kind of things can I do? Well, there are a couple notable companies that have already introduced custom GPTs. All Trails is a very popular app for finding hiking trails in different hikes in various areas. Well, they have a custom GPT that's specifically geared towards finding hiking trails. There's another company called Consensus, which searches through 200 million academic papers. So that is another specific use case that I think a lot of people have used GPT for. Sifting through documents that I

I don't want to read. Finally, Khan Academy, the online tutoring company, released one called Code Tudor to help people learn coding. And these custom GPTs aren't just trained on the entire internet like chat GPT is. They're trained on a specific data set so they can become really good and really useful at finding you what you need to know in this specific domain. Let's move on. Bottled water is not just bad for the environment. It's likely bad for your health too. It's always been known that really, really tiny fragments of plastic can be found in plastic water bottles, but a new study found that there's about 10 to 100 times more of them than previously estimated. Researchers from Columbia and Rutgers found roughly 240,000 detectable pieces in a typical liter of bottled water,

90% of which are nanoplastics, which at a width of 1,000th of a human hair, are so small that they can easily get into the tissue of your lungs, digestive tracts, or even, your bloodstream. The last study on this phenomenon back in 2018 only found an average of 325 pieces of microplastics in a liter of bottled water, but the new methods in this study found way, way more. People, quote, people think of plastics as, people don't think of plastics as shedding, but they do, Sherry Mason, a director of sustainability said, in almost the same way we're constantly shedding skin sales, plastics are constantly shedding little bits that break off. How's that for an unnerving visual to start your day with?

little unnerving, and this tells you what you need to know. All four of the co-authors interviewed said they were going to be cutting back on their bottled water use because of the study that they conducted. I immediately thought that as well, because I am a big refill my plastic water bottles, too, whenever you do buy one. I always try to reuse them because to me, that offsets some of the plastic usage. But now I immediately looked at plastic water bottles differently because two or 40,000 bits of nanoplastics, that's a lot of nanoplastics. Here's what's even more unnerving. The plastics only accounted for 10% of the total particles they identified. The rest could be minerals or other types of plastic or something else entirely.

And a report, but if the plastic isn't coming from the water bottles themselves, where is it coming from? And the researchers kind of hypothesize that some of the plastics could be shedding from, ironically enough, the filters that are used to filter this supposedly pure water. So we're getting plastic from every different which way up and down the supply chain. So there was a industry response, obviously, the great old bottled water association. They responded that there's no scientific consensus on the potential health impacts of these nano and microplastic particles. And if you actually look at the literature, they do have a point because scientists say, look, we really don't know whether this is harmful, how harmful it is, how it impacts the body. This is a very new area of research.

They do hypothesize that nanoparticles, which are much smaller than microparticles, it's crazy to say that there's something even smaller than micro particles, but they could affect human health because they're so small they can get into your bloodstream and filter through those semi-permeable membranes we learned about in eighth-grade biology. A lot easier than the bigger plastics, but it is true that there's no sort of conclusion or consensus on whether these are bad and how bad they are. it's just kind of a little alarming to think about. Absolutely.

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Book on Hilton.com or the Hilton app and save up to 20% to get the stay you expected. When you want savings, not surprises. It matters where you stay. Hilton, for the stay. Welcome to Neal's Numbers, the segment where I share three stats from the week's news

that will make you harder, better, faster, and stronger. The first stat is about the surprising resurgence of cursive writing in schools. Last October, California passed a law that makes cursive handwriting instruction mandatory in the first through sixth grades, becoming the 21st state to require some sort of cursive handwriting instruction. As recently as 2016, just 14 states required cursive. This is bound to make you feel a little bit loopy. Bring back cursive when everyone uses computers.

That's like telling people to start using outhouses again, even after we invented indoor plumbing. Here are some of the reasons cursive is coming back, though. The most frequent argument you hear is that learning cursive will ensure students can read primary source historical documents that are written in cursive. Another is to identify students' work and handwriting in the age of chat GPT influence cheating. And finally, a significant body of research has found that writing in cursive comes with lots of benefits for students, like building fine motor skills and developing synergies between different brain hemispheres.

Toby, are you buying stock in cursive? I'm so out on cursive. You're digging up a lot of bad memories for me, too, because I was never a very, I had bad handwriting growing up. So I never understood the point. is like, I already learned how to write, why are you teaching me this additional way to write? And the historical documents argument is absurd, in my opinion.

How many kids are saying, oh, man, if only I could read this historical document where they even write their Fs and S is weird? So, I don't know. I'm out on cursive. Well, what if you think it's wet in the horse of human events instead of what in the course of human events? Like that, that's kind of a big deal. But I agree with you because there are these new technologies

that will kind of transcribe a historical document into something that's a little more legible than what Thomas Jefferson wrote with his little quill. I'm on team keyboard for life. Let's teach kids how to write or how to type faster, not write cursive. This does seem like the last sort of dying, gasping breath of cursive because I don't think we're out. We're out. Okay, for my second number, let's say you were on a flight during which a door plug burst open at 16,000 feet. You feared you'd be sucked out of the plane and are now left with significant emotional trauma from the event. How much money are you entitled to? For passengers on the Alaska Airlines flight that happened to this week, that dollar amount is

$1,500. In addition to giving passengers on that flight an apology, a full refund, and access to mental health resources, Alaska Airlines is giving passengers $1,500 to, quote, assist with any inconveniences. The Washington Post interviewed several passengers on this flight to ask them what they thought, and they said they were still processing what happened and didn't really know whether this was the right number because they just didn't know how the ordeal would impact them in the coming months and years, is $1,500 enough to cover such a traumatic event? It is a very interesting problem. What makes it more interesting, too, is that if this case

ends up in court, some legal experts say that the amount of money each passenger could potentially earn hinges on how close they were to the opening, which I think makes a lot more sense. If you were a dude, like, way in the back of the plane by the bathrooms, you probably didn't get affected by this hole as much as someone sitting in the immediate row. So I think there should be a sliding scale based off of how close you were to the actual hole. Well, the people in the back, they already had to be in the back, bored last, get the plane last, and now they're not entitled to as much. I think you give middle seat people extra money as well just for being middle seat people.

But all seriousness, it's just, who knows whether this is $1,500 is enough. It's obviously it's the threshold at which Alaska Airlines thinks people will be appeased and they won't pursue legal action, but in cases in the past where things have broken in airplanes, there's been plenty of legal actions. So it does appear like this could happen. We just don't know who to sue yet. It could be Boeing. It could be Alaska Airlines.

It could be Spirit Aerosystems who made the part and put and assembled the fuselage. So things will shake out now. Things will continue to shake out. I'm sure there will be lawsuits in the future. And they're going to demand a lot more than just $1,500. For my final number, the workplace review site Glassdoor released its rankings of the 100 best major companies to work for and make fun of consultants all you want. but some of them love their job. The Boston-based management consulting firm Bain & Company was ranked number one based on anonymous

employee reviews. It's sixth time topping the list. Second was AI Powerhouse Nvidia, whose employees are probably pretty stoked that their stock options are worth a zillion dollars after last year's share surge. Some other takeaways, Apple returned to the top 100 list, checking in at number 39, one year after falling off completely. That could be because Apple didn't conduct mass layoffs like the rest of its. its big tech peers. Another interesting finding, retail made its presence felt, with a number of

retail companies doubling from five to ten among the top 100. In and out, Lulu Lemon, Heave Grocery, Wegmans were all ranked highly by their employees. Who the heck is paying someone from Bain Capital to, Bain & Coe, to always get on the top of the six years running? That is a pretty, or not six years in a row, but six years since they've been doing the survey, that is a lot. And Although, what other companies come to mind as someone who should be the top of this list? Well, I don't know. I don't work for them. I know.

Potentially, the one that I thought was in and out, actually, which is just a good vibe. Like, wear the hats. I don't know. But good for Bain, I guess. Well, Bain and Google have been on this list since it came out in 2009. They're the only two that have been in the top 100 the entire time. I mean, if you're working at Bain and Google, you're making a lot of money. Bain employees cite a lot of upward mobility.

So you get promoted pretty quickly if you do your job well. So, I mean, those two. combined, getting paid well, you get promoted and make even more money. It's all you need in life. Equation for success. Any listeners in the northern climes of the U.S. have probably had a similar water cooler conversation this year. Where the heck is all the snow?

Northern California snowpack this week sat at just 38% of its average. Most of the country has been well below snowfall averages, according to the National Weather Service. And only about a fifth of the country was covered in snow before this past weekend storm. the lowest and more than a decade. This is bad news because despite the occasional benefit of wearing a t-shirt outside in January, we need snow. For one, it generates a ton of economic activity through various ski resorts.

It serves as a valuable source of drinking water and irrigation come springtime, and it also protects certain winter crops so they can thrive once the weather warms. The main fear is that if the snowpack volume changes enough, all those benefits can go away very, very quickly. Neil, we're living in a bit of a snowmageddon. right now. We are. And you can easily say, you can easily point to one data point this winter and be like, where is the snow?

And you could maybe chalk it up a little to El Nino, which is making things a lot warmer this year specifically. But there was a new study release yesterday that examined 169 Northern Hemisphere River basins, which examined the snowpack there. And what you were mentioning, it's really critical

for there to be a lot of snow in the winter, because when that melts, it runs off and it basically serves as a frozen reservoir. for crops and agriculture in the spring and summer months. This study found that nearly half of them have seen their snowpack decline since 1981. So this is a long-term trend that has researchers thinking that we are just living in a long-term period where there is declining snow. And that poses a lot of problems economically, socially, culturally across the board.

And I want to talk a little bit about New York City because, you know, it's where we live. New York City has now gone 694 days without at least one inch of snowfall, a record snow drought. Also, New York City missed out on a white Christmas for the 14th consecutive year, which is a record since at least the 1950s. So New York City is not living in a winter wonderland right now. Well, let's not leave out our Assella Corridor friends because Baltimore, Philadelphia, and Washington, D.C. have also now gone more than 700 days without a single inch of snow. so it's just a little disconcerting when you're in January and you haven't seen a single lick of snow. Okay, here to interrupt our New Year's resolution of eating healthy are the Girl Scouts,

which officially kicked off their 2024 cookie selling season on Tuesday. The organization calls this cookie drive the largest financial investment in girls annually in the U.S. And I'm not going to question that because these cookies do numbers. Girl Scout cookies do about $800,000, $800 million in total sales each year. That's more than Oreos, and it tops Chips Ahoi and Milano combined. So what should you know about this year's Girl Scout cookies? Well, there won't be a new one to try. Last year, Raspberry Rally came in on the scene and was so popular.

It sold out everywhere and was being hawked on the secondary market for up to $80 a box. The Girl Scouts apparently didn't want to deal with that again. Speaking of prices, inflation is still a thing, so boxes are getting just their second price hike in 12 years. Depending on where you live, they'll range from $5 to $7. But honestly, it's the best $7 you ever spent. It really is. The sheer size of the Girl Scout Industrial Complex is astounding, but what was very interesting to me is that there's only two registered bakers of Girl Scout cookies in the U.S.

There's ABC bakers and Little Brownie bakers. And this is actually why sometimes near identical cookies have different names. So some people know those chocolate-strived coconut caramel cookies as Samoas, while other people know them as caramel delights. So that's why sometimes you see different boxes with different names. Also, they make the cookies differently. So if you've ever had one box of thin mince that just really hit the spot and one that you thought you didn't like as much, they do have slight differences in the recipes.

So that's some of the nuances going on behind the scene of the Girl Scout Industrial Complex. Okay, we have to wrap it up there. Toby, what is our swing thought for the day? Our swing thought is a quote from the author, Mel Robbins. quote, you call it eating five boxes of Girl Scout cookies alone. I call it supporting young female entrepreneurs. Now, I know you may be laughing, but there's some deeper truth there. The perspective you take when evaluating an action can be just as powerful as the action itself.

That's a lovely thought, Toby. Let us know what you thought about any of the topics we discussed at our email, Morning Brew Daily at Morningbrew.com. Let's roll the credits. Emily Milliron is our editor and producer. Samantha Vela's and Raymond Lou are associate producers. Eugenua Ogu is our technical. director. Billy Minino is on audio, hair and makeup has left us for Bain. 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. 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 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.