The Best One Yet - 🚽 “No Door?” — Hotels’ Disappearing Bathrooms. Davos’ T-Day. Amazon’s Maxxing Store. +See-through Lulu

Starting point is 00:00:00 This is Nick. This is Jack. It's Thursday, the new Friday. January 22nd. And today's pod is the best one yet. This is a T-boy. The top three pop business news stories you need to know today. Jack, I already blew out my breakfast birthday cupcake candle.

Starting point is 00:00:17 This already happened. Wait, this is your Brown birthday, isn't it? Yet is Nick played lacrosse at Brown University. No big deal. And guess what his jersey number was on that team? 38. Yes. Which is the birthday you're celebrating today.

Starting point is 00:00:30 It's your Brown birthday. Jack, I see what you did there. Always round up, but we got three fantastic stories for today's pod. Jack, what do we got for the birthday T-boy? For our first story, have you noticed that hotel bathrooms sometimes don't even have a door anymore? The disappearing hotel bathroom door. It's actually a microcosm of our economy. For our second story, Davos, just had the biggest day in its 55-year history,

Starting point is 00:00:55 including President Trump's big speech and his tariff cancellation. There's more drama in Davos, right? right now than a Bravo series reunion, so Jack and I, we're not there, but we dove in. And our third and final story is Amazon, because it's building the third biggest store in America just outside Chicago. Bigger than Walmart, twice the size of Target, this thing is 230 Starbucks. But Amazon's very big box mega superstore isn't actually about buying. It's about returning. But yeties, before we hit that wonderful mix of stories. Fantastic mix. Love the mix for the new Friday, Jack.

Starting point is 00:01:28 Happy birthday, Nick. I do have a present for you. Ooh. But it is not Lulu Lemon leggings. Yeah, I'm going to ask for a hold on the Lulu Lemon bug and leggings Jack. Because Yetis, Lulu Lemon has done it again. They're recalling leggings because they're see-through. Oops, I did it again.

Starting point is 00:01:45 Shares of Lulu are down 6% because the new Get Low leggings, they're just a little too low. According to Bloomberg reporting, Lulu Lemon stopped the sales of their Get Low Leggings just two days after launch because they didn't pass the quote-unquote, squat test. Basically, you sat, they showed. You stretched, the seam stitched. While you were resting, the pants were revealing. And Lulu Lemon actually has a long history of being short on material.

Starting point is 00:02:11 Or to whip out a pheasurer, Jack, on being transparent when they should have been opaque. 18 months ago, we covered it on this pot. They had to pull their breeze through leggings for unflattering fits that resembled a whale tail. 2013, Lulu lost 60 million bucks in sales on a sheer pants recall. And who could forget, the original CEO got booted from the company after a scandal that began with see-through leggings. Ah, well, now Lulu is dealing with glute gate yet again. And we're not sure who is more hurt. Wearers or shareholders. Yeah, and as a shareholder here, I am feeling hurt. Yeties, if you're in a changing room right now, don't forget the squat test. And yes, this applies to khakis too. If you know, they ripped, you know. Full disclosure, one time I was

Starting point is 00:02:53 wearing a suit on a business trip, and it failed the squat test. Thank God nobody noticed. That's why you do it in the mirror, Jack. It's why you do it in the mirror, Jack. Let's do it our three stories. Fifteen years before this song, two boys from the Northeast met in the dorm. They had an idea to cause a cultural storm. It's the best one yet, but the best is a norm. Jack Nick, that's it. I don't even think they need to practice. 50% that's a fat tip. Tea Boy City on your at list. If you know, you know, because we're rare to go. We can't wait no more, so just start the show. First, a quick word from our sponsor.

Starting point is 00:03:41 For our first story, strange phenomenon, hotels are getting rid of proper bathroom doors. And this disappearing hotel bathroom door phenomenon is actually a microcosm on the travel industry, the post-pandemic business norms, and even our housing crisis. Basically, our whole economy. You see, Yeties, Jack noticed this the last time he was visiting San Francisco, and over the long weekend, I noticed it at our hotel down in Carmel, California. The closets have gotten really small in hotels. The desk is really small. But hang on a second, does my bathroom not even have a door? We're sorry, but that's a trend. No longer is there a fully closable opaque door between the restroom and the bedroom, and yes, we just said opaque for the second time on the pot. Sometimes instead of a bathroom door, hotels are installing a curtain. Sometimes it's a frosted glass door.

Starting point is 00:04:33 And sometimes it's a sliding door or a pocket door. Sometimes, Jack, it's just an open, voyeuristic adventure. Honey! Turn up the volume because I have to go to the bathroom. Door no more. To save money, hotels are now eliminating proper bathroom doors. It's a fact. That's the trend, which means there's nothing to contain the noise, the view, or the smell of your B.Ms.

Starting point is 00:04:54 So, Bessie's Jack and I got curious. We jumped in T-boy style, and it all begins with the Wall Street Journal and one woman who was horrified. Well, she was horrified because she booked a hotel room for herself and her dad, two twin beds, and then she discovered there was no bathroom door, and she was staying in the room with her dad. So that woman launched a crusade to shame hotels that do this, and so far she's got a list of 500 of them. Including hotels owned by Marriott, Hyatt, and Starwood. But besties, it's not just that the average door costs $500, right, Jack? And it's not just that for a 200-room hotel, we're talking $100,000 in door-com.

Starting point is 00:05:32 costs for the bathrooms. And it's not just the one-off installation cost of the doors either. No, what we find fascinating is that it's also the ongoing operating costs of a single door. Because think about it, a windowless bathroom in a hotel is cut off from all natural light, which means you must have the light on to do anything in there. So the hotel's energy bill goes up. And since it's not your house, it's a hotel, you're more likely to leave the lights on when you leave your hotel. So that energy bill goes up even more. And more light means you have to replace the light bulbs more often. Which means higher material cost. And with constant use of that hotel bathroom door, the door gets jammed.

Starting point is 00:06:07 So labor costs go up to. So if you're a CFO, that single bathroom door is a silent, solid slab of costs. It's the opposite of this. So you'd rather have a guest complaint or two from a mom who books a hotel room with her kid than miss your earnings print because of a bathroom door. I can see the shower head from the head of the bed. I'm giving it one star. Jack, what's the takeaway for our buddies over?

Starting point is 00:06:32 in the hospitality industry. The disappearing hotel bathroom door actually reflects our economy. It's not just the microeconomics of a door on the P&L statement, it's also the macroeconomics of that door. The reason hotels are going to such lengths to save money on bathroom doors is that business travel is not back. Look, while leisure travel is all-time highing right now, business travel still below pre-pandemic levels. Another reason for the disappearing bathroom door at hotels is regulations. That's right, the ADA. Americans would Disabilities Act requires wide doors, which require a big space to swing open, but not having a door avoids that. So this story is about so much more than an 80-inch wooden frame that is a door.

Starting point is 00:07:12 That is right, Jack. The disappearing hotel bathroom door is a microcosmo travel of post-pandemic business norms and of our construction red tape. And on the importance of bringing the eye mask and earplugs anytime you travel. For our second story, Davos was the center of the world yesterday. Yesterday, heads of state, CEOs all making world-changing announcements in one Swiss ski town. And yeah, the fondue wasn't free. But what actually is Davos and where is it actually going? We're going to dive into the history. Yeah, it is Davos, the short name for the World Economic Forum, created by Klaus Schwab back in 1971.

Starting point is 00:07:55 No relation to Charles. Professor Klaus Schwab believed that, quote-unquote, lasting progress requires cooperation within business, government, and civil society. So Schwab chose Davos, a ski enclave nestled in the Swiss Alps because, well, private jet pilots, they already knew the route. Over time, Davos became an offsite of the rich and powerful to make deals and determine the winners of the future. At least that's how it seemed from the outside. Which is why every big tech company set up glitzy parties sponsored events and has a seven-minute walk become a 45-minute escalate security convoy. Salesforce alone has a

Starting point is 00:08:31 building that's called the Davos Agentic Innovation Center. Okay, but Jack, I'm sorry, not to be confused with Salesforce's lodge at Davos as well. Which is across the street from the Salesforce chalet, which is also at Davos this year. Yeah, they say the Rolexes feel better when you get them fresh from the factory next door, Jack. Zuckerberg is probably at that chalet, showering some prime minister with champagne so he doesn't regulate Instagram. That's what happens at Davos. At all often, that's why we call it Burning Man for billionaires. Jack, don't forget the dress code, by way. Patagonia inner vest, Montclair, outer vest, and a strong sense of moral urgency. Moral urgency. I love how ambiguous that is. If you have to ask, you clearly haven't been,

Starting point is 00:09:13 Jack. But besties, this is what we find fascinating. Many people are questioning if Davos is still relevant after all these 55 years. But this Davos was more relevant than ever. And the headlines were about AI, Trump, and Davos itself. All right, Jack, let's jump in T-Boy style and start with AI. Specifically, Dario Amadeh, the CEO of Anthropic. He made headlines on Tuesday after saying that the United States selling its top AI chips to China is like selling nuclear weapons to North Korea, something we probably shouldn't do. Yet he's that bold statement puts the Anthropic CEO at odds with NVIDIA and the Trump administration.

Starting point is 00:09:50 And Dario also said that if left unregulated, AI would result in the future in a world where just 10 million people own all of the world's wealth. Another huge hot take. And then Microsoft CEO, Sotchanadella, agreed that policy must ensure that riches of AI get spread out among people. But Nick, the headlines weren't just about AI. They were also about geopolitics and trade. The biggest headlines on those topics in a year. Like we told you yesterday, Canada's prime minister and the European Union declared the United States no longer a reliable partner. And they said that at Davos. And on Wednesday, President Trump finally made his big speech. He showed up. He actually got a literal red carpet and said he was. would get Greenland one way or another, but ruled out using military force to do it. And to those who hoped for a taco moment yesterday, including us, we got a taco moment.

Starting point is 00:10:38 Yeah, the news. Trump said that he has a framework, quote unquote, of a future deal on Greenland, so he's canceling his tariffs on eight European countries. To those who think Trump always chickens out, that kind of happened. The stock market rebounded yesterday. And all of that happened in like 24 hours that would have made Andy Cohn blush. Indy Cone was probably at Davos, wasn't he? It feels like he should have been there, Jack. But Besties, Trump and his America First policies are bringing the entire World Economic Forum into question, which leads to our takeaway. So, Jack, what's the takeaway for our buddies? Pardon it up over in Davos. Davos and the World Economic Forum are a symbol of globalism. But globalism is in crisis.

Starting point is 00:11:19 You see, Eddie, every year, the World Economic Forum announces a theme to reflect the biggest global issue of the day. In 2002, the World Economic Forum held their meeting in New York City. city to show support to New York post 9-11. It's the only time the Umed has not been in Davos. In 2018, the theme was gender diversity on corporate boards, and in 2019, the theme was climate. Post-COVID, it was stakeholder capitalism. That is, corporations shouldn't just be focused on profits. But you see, besties, all those themes were in retreat with the rise of populism across the globe. Globalism is about countries cooperating and collaborating together, and using trade as a force of peace. And the assumption was that the private jet crowd would determine

Starting point is 00:11:59 that future. Well, Larry Fink, the CEO of BlackRock, has taken over as the head of the World Economic Forum this year. And if we know Larry Fink, we know he knows that globalism is in crisis, so he's trying to make changes at Davos. So next year's Davos will probably be a lot different than this year's. That is, if Davos wants to remain relevant. If it even stays in Davos. Now a quick word from our sponsor. For our third and final start, story, Amazon is opening its biggest store ever just outside Chicago. This thing is bigger than Walmart. It is the size of two targets. But Amazon's first big box store isn't going to be about buying. It's actually going to be about returning. Ah, Eddie's everyone knows the suburban shopping plaza smorgasbord, even if you grow up in the big city.

Starting point is 00:12:56 Huge parking lot in the middle with like six big box stores. Mine is called Maple Tree Plaza, probably owned by private equity. You got a Bob's discount furniture on the left. Huge store. You got a Best Buy on the right. Even huger. You got a Walmart right down the center. Usually the hugest in the whole plaza. Maybe we'll hit Home Depot. I don't know if we'll have enough time, Jack. And right next to Dick's sporting goods and Petco is going to be a huge new store with the word Amazon on top. Voila, yeties that will soon be true in Orland Pork, Illinois, which just approved a 230,000 thousand square foot Amazon store. To be clear, it's Orlando Park, not Orlando Pork. Although, being near Chicago, I get why you made the mistake. You never know, Jack. Could you please sprinkle

Starting point is 00:13:40 on 230,000 square feet of context for us, though? That is the size of four football fields, or three New York City residential blocks. It could hold 200 American homes inside that store. Or 231 Starbucks, yet he's this Amazon Super Megastore will be the third largest store, America. Behind just Macy's New York City flagship location and Walmart's biggest store, which happens to be in Albany, New York. Now, Besties, Amazon made headlines on Tuesday for admitting that tariffs are raising prices on Amazon.com. That should not be a shocker. But this headline was a shocker. Amazon is trying once again to crack the code on physical retail. Amazon is protein maxing to the extreme. They're maxing retail right now. But Nick, pause the pod.

Starting point is 00:14:28 physical stores have been Amazon's Achilles heel for over 10 years. They're great at e-commerce. They're terrible at regular commerce. Amazon does clicks. They don't do bricks. They have so many failures. We would include more, but we have a 20-minute pod. We've got to keep this thing short, check. Amazon's physical retail journey began with 24 Amazon bookstores, all of which have been closed. And then came Amazon's $14 billion acquisition of holds foods widely seen as a GMO-4. free failure. Have you ever visited an Amazon four-star store? This is a store only with items rated four-stars or higher on Amazon.com. Well, guess what? They're all closed now. Jack, how about an Amazon fresh store? What about those these days? It's a grocery store that awkwardly competes with

Starting point is 00:15:15 Whole Foods in a sibling rivalry. And they are still open, but officially they're in re-evaluation status by Amazon Management. Amazon Go? That's the innovative just-walk-out technology with no cashiers. Yeah, half of those have been closed, too. Which brings us to Amazon's style. Two fashion stores were opened in 2022. Two fashion stores were closed in 2023. Amazon style basically went out of fashion. So you got to give Amazon some credit for failing fast. Totally, Jack. It's better to kill your losing experiments quick than let them drag out and generate losses. But besties, Amazon's obsession with the white whale of physical retail is borderline cat in Ahab right now. It's six previous attempts have all failed. And now,

Starting point is 00:15:56 instead of like moving on to something else, they're trying again with the third biggest store in American history. So Jack, we all get asked, why is Amazon obsessed with this white retail whale? It's because 80% of retail sales in this country are still done in person, according to data from the U.S. census. But besties, Jack and I think this Amazon ultra super mega store is actually about the opposite of buying. It's about the other side of the transaction. So Jack, what's the Takeaway for our buddies, maxing over at Amazon. Amazon's Super Megastore isn't about buying things. It's about returning things.

Starting point is 00:16:33 Yadies, look, you don't use Amazon for groceries. You use it to buy USB cords and curtain rods and batteries and vacuums and thytastrosol. And slippers to wear in your gym's shower. I don't know. Stuff like that. What's going on in that gym shower jack? That was my most recent purchase on Amazon. Well, guess what?

Starting point is 00:16:48 Those kind of products, 15 to 40% of them get returned. That's why this information from, the Wall Street Journal's reporting is key. Amazon's big box store is actually going to be one-half store, one-half distribution center. And distribution centers aren't about retail at all. They're about logistics, like return processing. And that is why we think this Amazon super store will be able to do something never, ever done before.

Starting point is 00:17:13 You'll be able to return your thing and swap it for the right one because there's also a distribution center. Emerging of Amazon.com and Amazon in person that's never happened before. And that is the real consumer problem that Amazon's fiscal store is just haven't solved for yet. So when Amazon officially announces this store and opens it up next year, we'll know for sure. But in the meantime, we think Amazon's big box super store isn't about buying things. It's actually about returning them. Jack, could you whip up the takeaways for us for the new Friday?

Starting point is 00:17:44 Hotels are eliminating bathroom doors to save material costs, energy costs, repair costs, and real estate costs. Oh, the disappearing hotel bathroom door. actually a microcosm of today's economy. For our second story, Davos has been the center of the world this week. And stocks rose on Wednesday as Trump talked on tariffs. But Davos is also a symbol of globalism, and globalism is in retreat across the globe. And our third and final story, Amazon is building a 230,000 square foot super ultra-megas store just outside Chicago. They're a retail max.

Starting point is 00:18:17 And our guess, the differentiator won't be the sales. The differentiator will be the returns. But besties, this pod's not over yet. Here's what else you need to know today. First, the company behind the Las Vegas sphere is building another one in Washington, D.C. It's a sequel. It's a sequel. The sphere is a giant performance venue, shaped like a sphere with screens on the inside and on the outside.

Starting point is 00:18:39 Okay, but this D.C. one, it's going to be smaller. They call it a mini-sphere. We call it a hemispphere. It should be called a hemispheres. It's got 6,000 steeds instead of 18,000 in Vegas. And by the way, Sphere is actually a publicly traded stock worth $4 billion bucks, and they're making another big one over an Abu Dhabi in the Middle East. Second, according to Bloomberg, the newest user of artificial intelligence is college admissions offices.

Starting point is 00:18:59 That's right, admissions officers are using AI to read your essays, review your transcripts, and see who you are. The goal is to speed up the application process so that they can let you know if you got in in like December instead of waiting until April. But here's the plot twist. Colleges are also using AI in the application process to make sure you didn't use AI in the application process. So Open AI has found a way to sell AI that will make sure that students didn't use Open AI as AI. And finally, wouldn't it be nice if you got refunded for tickets when your team loses the game? Well, that's happening. Because Man City, a top-tier football club in England, had to travel all the way to the Arctic Circle to play a club up in Norway.

Starting point is 00:19:42 A epic Champions League game. But then Man City shockingly lost to a much lower team 3 to 1. It's a cool thing about European soccer. You can play against a team completely at a different level. yours. Well, Man City was so embarrassed. They're refunding fans for their tickets and for their travel. Now, time for the best fact yet, which, because it's my birthday, I whipped up a little surprise for you in this one. You ready for this, Jack? It's a T-Boy tradition. What do you got, Nick? Jack, you always like a good theme for my birthday, you know, host the party you wish you were

Starting point is 00:20:11 invited to. And this year, it's a tiki bar. A Polynesian theme called the Tonga Room, this crazy place in San Francisco. Yeah, it's in the Fairmont, which is the same hotel that Sean Connery stayed in in the movie The Rock. So it's a classic. Well, I got curious about Tiki Bar, Jack. Turned out the Tiki Bar searched in popularity after World War II because American soldiers returned from fighting in the Pacific. Makes sense.

Starting point is 00:20:33 But it also turns out that the Mai Tai Tiki cocktail, the one made with rum, was also invented in the Bay Area. And do you know why this cocktail is called the Mai Tai? Wait a minute. The Mai Tai is a cocktail that was invented in the Bay Area of California? Well, it's because a visitor from Tiki. Heidi tried the Mai Tai cocktail and said the words, My, Thai, Roa I.

Starting point is 00:20:57 And do you know what that means in Tahitian Jack? No. Out of this world, the best one yet. You're kidding me. The Mai Tai, it basically is a Polynesian term for the tea boy. What are the odds of that, man? Okay, let me tell you. Every one of our live shows this year, we're going to go to the after party,

Starting point is 00:21:15 and that's got to be like the house drink. Besties, Mai Tai Roai. Amazing. Yeties, you're looking fantastic over there, Jack. Thank you for looking fantastic. And remember in the fourth quarter birthday. I appreciate it, man. Dude, happy birthday, man.

Starting point is 00:21:29 I can't wait to see you in person so I can give you a gigantic bear hug. I mean, well, Jack, you know what I wished for on that breakfast cupcake candle? What? It's hitting all-time highs. I hope Kim Kardashian comes on the pod. I don't want Glock to be extra. And I hope on your next flight over, you don't get a windowless seat. I think three of those four things are definitely going to happen.

Starting point is 00:21:47 Kim, if you know, you know, Jack and I will. see you tomorrow. Oh, a happy birthday to all the other 20 tours out there. Madeline Sillinger is turning nine years old. Jack, she's over in Brooklyn. She's on the way to school, and this is her best birthday yet. Happy birthday to Royce Yoscival, who's listening on the way to school, but in Berkeley. And Melody Bryant, enjoy the best birthday yet down in Nashville, Nashville, Nashville, Nashville, Happy birthday. Happy birthday to John Loop Key, who's pickleballing in Charlotte right now to celebrate. And Brandon Lex celebrating a fantastic birthday over in Springfield, Illinois. Happy birthday to the best girlfriend yet,

Starting point is 00:22:27 A Coley Van Gala in Seattle. And Issey Samson, happy birthday down in Sugarland, Texas. And happy birthday to Devin L. Devmeister LaGlofflin, who's turning 31 at New York City. And a shout out to Katie and Derek Borowski with their son Nolan, who are celebrating Katie's birthday down in Denver.

Starting point is 00:22:43 And a big shout out to Rihanna Singh. Thank you for sharing the show, H-Y-H-T-O-Y. Have you heard the best one? This is Jack. I own stock of Amazon and Nickle in stock of Lul-L-Lennon. Thank you.

The Best One Yet - 🚽 “No Door?” — Hotels’ Disappearing Bathrooms. Davos’ T-Day. Amazon’s Maxxing Store. +See-through Lulu

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