The Best One Yet - 💰 “TeenCrypto or KidCoin?” — Roblox’s robux. Macy’s makeover. The Great Chicken Shortage.

Episode Date: May 12, 2021

Roblox jumped 21% because kids want Robux for their birthday. Macy’s was so close to bankruptcy it should be nursing itself back to health, but instead it’s going BIG in New York City real estate. And stocks just dropped because of inflation worries that can all be explained by a chicken and a rooster.$RBLX $M $TSNGot a SnackFact? Tweet it @RobinhoodSnacks @JackKramer @NickOfNewYorkWant a shoutout on the pod? Fill out this form:https://forms.gle/KhUAo31xmkSdeynD9Got a SnackFact for the pod? We got a form for that too:https://docs.google.com/forms/d/e/1FAIpQLSe64VKtvMNDPGSncHDRF07W34cPMDO3N8Y4DpmNP_kweC58tw/viewformLearn more about your ad choices. Visit podcastchoices.com/adchoices Hosted on Acast. See acast.com/privacy for more information.

This is Nick. This is Jack. And this is Snacks Daily. It is Wednesday, May 12th. The Dow just had its worst day since February for reasons we're about to explain. The pod just had its best day since yesterday, Jack. For reasons explained it by T-B-O-Y, Jack, the best one yet. What's our first story today?

Millennial kids dreamed of getting unlimited tokens to play in the arcade. Kids today, they don't want air hockey. They want a Roblox account full of the Robux. For our second story, Macy's was so close to bankruptcy. So close. They should just be nursing themselves back to hell. It's true start. Instead, Macy's just whipped up, honestly, the boldest plan of retail we've seen this year.

For our third and final story, stocks dropped yesterday because inflation, which means you're going to be paying a little bit more for just about everything. But here's the funny thing Jack and I notice. It can all be explained by the great chicken shortage. But Snackers, before we hit those three fantastic stories. It's a wonderful mix today, Jack. Best idea of 2021, those new Ben and Jerry's flavors we shared yesterday. All right, here's the best one so far. Bada Bing, Bada Zoom.

From Tony DeRosa. Great call. Love that one. But Jack, the worst idea of 2021? What are we thinking on this? Instagram kids. Yeah, all the problems of adult social media now in a child size app. Sounds wonderful. This is the social media app that no one asked for.

Yeah, Facebook's making Instagram kids because they found product market unfit. You know what? Eight-year-old Annie doesn't need to see on her birthday, Nick. That Julie got a pony for hers. No toddlers should have to stress about the like count on their first steps video, Snackers. Why won't my babysitter take a drug test? Like, comment or share if you want to join my free the fanny movement. Don't we all?

But Snackers, hear the numbers that are important. 44 American states have now asked Facebook to not launch its Instagram Kids app. So, Jack, I got to ask, what's the takeaway here for Instagram kids? We all know what a zucking is. Yeah, any idea that's so good, Facebook copies it. Well, this should be the first ever anti-zuck. An idea is so bad, nobody copies it. Let's hit our three stories.

We spoke to the lawyers and we got to get something legal out the way. It snacks about to hear anything. They don't reflect the views of the robberhood family. It's all informational just so. We're not recommending any securities. It's not a research report or investment advice. Not an offer or sale of a security. Snacks is digestible.

Business news for you. Robahood Financial, LLC, member FINRA slash SIPC. For our first story, Roblox, it's jumping. 21% after like insane growth in its first earnings report. Roblox created the virtual currency for the pre-teenager economy. Okay, Snackers. Here's the, uh, here's where you get. You're speechless.

I'm speechless right now. Roblox is the video game app that like, they figured out how to get people to make their product for free for them. They don't pay developers to make the games. They just let developers make games and then give them the cut of the revenue afterwards. You'll love to see this. It's kind of like how Uber is getting the rides for free, but they're just given a cut to the driver.

So two months after this video game company that doesn't make their own video games, direct listed, they announced their first earnings yesterday, which sent the stock 21% high. Okay, the wild number here. Let's listen to this growth. They're getting a million new users every month. Now, if you download the Roblox app like a million people do every month, apparently.

And you want to play. It's free to download and start playing Roblox, just like it's free to walk into an arcade. But, Jack, you play Roblox and not let the game. Robox play you, you need some Roblox. Astute observation. Thank you, Jack. Roblox players, they spend real cash money to buy something called Robux, which is virtual

money to use in your Roblox games. Basically, you're wandering around, you're hanging out in this virtual world. You're going to want to parakeet to chill on your avatar's shoulder. I mean, that's going to cost you a couple of robots. It's gone. But then, you know, you've been hanging out in there a few hours a day. You get to meet someone. You have a crush.

You want a gift him or her or something. A little bit of romance. It's not off limits in Roblox. Maybe a matching parakeet, maybe a virtual salmon slamming sweater, Jack. Snackers, these in-game transactions are a lot like what Fortnite does, but the Robux economy in there is huge. Okay, listen to this hero stat we noticed. Roblox sold $652 million worth of their virtual currency Robux just in the last three months. That's a lot of Robux, and it's up 166% from last year's same quarter.

Jack, I mean, Bitcoin, Ethereum, Dogecoin, they're getting all the attention these days. Come on. But robux are the virtual currency of the preteen economy. Jack, this feels like a moment for a PSA. Can we drop a pro tip right now? I feel like we should do that. You got a 12-year-old niece or nephew? Maybe you do.

Buy him or her robucks for their birthday. Trust us. So he can play more Roblox. Get this. Another insane stat. Two-thirds of nine to 12-year-olds in the United States, they're playing Roblox for 2.6 hours a day. Okay.

And to hook them up with some Robux, you don't want to be a cheap antor-er-uncle. You don't want to be that guy. Give the Niezer nephew 15 bucks. That's the average Robox splurge last quarter. And Jack, can I let you in on a little surprise? Please do. I put $40 in a savings account for Wilder to give him Robux on his 10th Thursday. So what's the takeaway for our buddies over at Roblox?

Dude, you have outdone yourself. That's the real takeaway here. Roblox has references. Parents trust Roblox and they're the real customers. Snackers, remember like two minutes ago when we mentioned Instagram kids? That's the worst idea of 2021? Yeah. Well, right now you have to be 13 to Instagram.

but Facebook's trying to change that. Now, 44 states, they don't like that, and they're citing the potential negative impact of mental health issues and bullying on kids who could use that Instagram kids app. Roblox is trying to get the same kids, but they're a little bit more safety for it. Yeah, they are.

They mentioned the word safety 88 times in their S-1 filing document to go public. I mean, I'm looking on the website right now, Jack. They got a section here for the parents. They're highlighting the education. They got the whole digital well-being resources already ahead of the game. Roblox's good, clean family fun

has got the blessing of the real, customer, mom and dad. And parents control if the kid can play. And parents are the ones paying for the kids as Robux. For our second story, did you ever finish that Bassinet, by the way? Dude, yes. I showed you a picture of it. Bassnet, Bassnet, Bassnet. Second story, Snackers, Macy has avoided bankruptcy. Incredible. And now Macy's has put forward a shockingly bold proposal to turn their flagship New York City store into a destination. All right. So technically, we checked the calendars. Macy's, earnings are next week, but the stock had an all-time low back in the summer.

Investors assumed Macy's was going bankrupt during the pandemic. And Jack, I feel like now is an appropriate time before we continue for a moment of silence for J.C. Penny, Lord and Taylor, Neiman Marcus. And all the other department stores were departed into Chapter 11. Maybe forever, 21. Now, bankruptcy would mean that the stock of these companies would just plummet to zero. It would be at $0. So fearing that that was the future for Macy's, investors bailed last.

summer and the stock fell to an all-time low of $5 per check. Jack and I noticed yesterday, Macy's didn't just survive. Stock's up to $16 now. Not too shabby. But let's be honest, they're still way off their historic levels when malls were a big deal. Okay, so now we know what you're thinking, what is Macy's going to do? Well, department stores, they do one thing, they do one thing really well, they come up with turnaround plans. And the answer for their turnaround plan, it always seems to be we're going to do e-commerce. Check out our deck. We're going to do online e-commerce. apps for Gen Z. Not for Macy's. They're doing the opposite. Macy's, the Crown Jewel is their Herald Square, New York City flagship location. Yes, it is. And they're kind of pulling a Bobby

Frost on us here because they're doing more there. They got a million square feet of retail space in Harold Square. It's a right of passage in New York to get lost. You enter on 34th in Broadway. You do. You leave and you're on like 35th and 7. Jack, I entered once on 34th Street. I came out in a different dimension. This store, it has 43 sections across 12 floors and another million square feet of office space for Macy's corporate headquarters. Which is why we noticed this shocking headline from Macy's yesterday. They're offering a $235 million investment to add a huge office tower above the OG department store. On one condition.

One condition. The city of New York help out by upgrading the subway stations around the building. Yes. Permanently blocking vehicular traffic and turning this plaza into a pedestrian paradise. Jack, could not be more on board with this plan. By this time next year, You and I should be able to lie down on our backs in the middle of Harold Square and record a podcast. That would be great. And if this is approved, if that happens, Macy's will have a whole office building

above their OG building, which will continue operating during construction, by the way, to collect rent. Sounds kind of like a profit puppy for them. Also, 17,000 workers working in that building, they're probably going to stop by Macy's during their lunch break. Also, New York City gets to preserve Macy's as the anchor institution of Herald Square. Where else were the Macy's Thanksgiving Day parade end than Harold Square? My mom once carried a balloon in it and her heart, I think, is still in 34th Street. I can't do a what do you want back your impression. So, Jack, what's the takeaway for our buddies over at Macy's?

Fit creatively about your core competence. Okay, real estate, that is something that Macy's really understands even more than retail. They also understand catering to tourists because the 34th Street location, it literally has a Christmas movie named after it. Buddy V. Elf literally worked there. I did. Now, Macy's isn't going into e-commerce. It's doubling down on physical retail instead. And we've said it before, retail's not dead, bad retail's dead.

This plan flexes Macy's real estate expertise and their relationship with tourists to create good retail. It thought creatively about their core competence. For our third and final story, why did stocks just drop? We know that's what you're thinking. Naturally, the concern that we're about to pay a little bit more for just about everything. And this all begins with chicken and roosters. It begins with Tyson foods, which produces one out of every five bites of meat in America. They're famous for the ballpark Franks, maybe the Jimmy Dean sausages.

They're less famous for the standard three pounds of chicken brass. They're basically the Tupac to Beyond Meat's notorious B.I.G. Sales rose 4% last quarter for Tyson Foods. They did, but we don't want you to think about that. Forget that number. Here is the more important number from Tyson. Chicken prices jumped 8% last quarter. The great chicken shortage.

The great chicken shortages upon us. And there's two sides that cause a shortage. First, we're going to look at the demand side. Chicken is to 2021 as bacon was to 2011. And kale and avocado were to every single year since. Jack, the top pandemic delivery food, need I say more? Wings. The top fast food in the past year, fried chicken sandwiches.

We don't want to know who's launching a chicken sandwich. We want to know who's not launching chicken sandwiches these days. So on the demand side, there's record demand for chicken in America, but we already knew that. We've talked about it. It's been a snacks daily theme. You've heard about the chicken demand. On the supply side for chicken, we're actually seeing record problems. Yeah, this is wild snackers. Jack and I jumped in snack style, and we almost broke the whiteboard on the number of things here. First, let's talk about the chicken feed, Jack. The prices of soybeans, corn, and wheat.

Delicious. Have almost doubled just in the past few months. It's the highest price for those commodities in a decade. You got like a lot of reasons for this. You got bad weather. You've got some corn's being used in fuel. You've got China buying up a bunch of our stores. soybeans, a whole bunch of factors. Another supply side issue is labor. The pandemic kept people at home instead of in the factory. I mean, you can't have dozens and dozens of workers in a factory plucking chickens next to each other in the middle of a pandemic. Okay, another random issue for the chicken industry, the shipping industry. Totally. Port problems this winter that left

ships stuck at sea. Chicken nuggets sat there on ships just outside of port. Literally, that's burning cash for Tyson foods. The Pacific Ocean, just nuggets waiting. Now, this last one is extremely specific to the chicken industry. Jack, I don't know if we can say this, but this may be my favorite supply side issue with the gray chicken shortage. One type of rooster for Tyson Foods hasn't been as fertile as in previous seasons.

You heard us right. This one particular rooster species isn't helping produce enough eggs to hatch with the chickens. So Tyson has fired this breed of rooster from their breeding program. That's right. The rooster gone.

It's causing the gray chicken shortage. So, Jack, if we add all that up, Tyson now says they expect substantial inflation across their entire supply chain. Inflation, meaning rising prices. That's right, because you've got more expensive feet and more expensive labor and more expensive new roosters. And all of those costs, those higher costs, they get baked into the price per pound of that bone and chicken thigh that Tyson wraps up against the grocery store. And that is why we've got the great chicken shortage. So, Jack, what's the takeaway for our buddies who are all of us, every single person? Inflation is the Godzilla of economics.

Everyone's afraid of it, but we haven't seen it in years or decades. But funny things, Snackers, the number one theme that Jack and I have noticed for this entire second quarter earning season is that companies now are seeing Godzilla. Your go-to-anything. Has upped prices just a little bit because of the same issues we just described in the chicken industry. Supply is tight. You got expensive materials and not enough workers. On the other side, demand is strong. Revenge spending and stimulus checks.

You're not satisfied with the chicken snackers? Oh, we got some more examples for you. Procter and Gamble, raising prices on pamper's and tampas. General Mills, raising prices from Cheerios to Cocoa. Oh, you want to drive in your car to the drive-thru to buy some of those chicken sandwiches? Well, car companies are jacking up prices because of a shortage of computer chips. All these rising prices, the Fed can combat inflation by jacking up interest rates. They've done it before.

Now, our central bank hasn't had to do that in decades. And if they did, that would make stocks less attractive because of the higher interest rates. And that's why we had stocks dropped yesterday. fears of this. So Snackers, the next time that you overpay for chicken. It's a reminder that the Fed may have to jack up interest rates to slay Godzilla. And that would be bad for stocks. Jack, can you whip up the takeaways for us over there? Robox players are convinced a mom and dad to buy them some robox. It's the virtual currency, but mom and dad are the real customer. Macy's has an ambitious plan for its New York City Herald Square flagship store. Yeah, it thought creatively about its core competence. That's the

And fears that inflation could lead to increased interest rates, it's spooking investors again. Inflation, it's the Godzilla of economics, and we might be seeing it for the first time in years. Now, time for our snack fact of the day. This one sent in by Chris Louis from lovely South San Francisco. Chris, I'm waving to you from up north here, if you can see me. Hey, Snackers. The great San Francisco earthquake of 1906 and resulting citywide fire destroyed many immigration records. That gave Chinese immigrants living in America the opportunity to claim that they were born there, which granted them birthright citizenship and allowed them to legally bring their children from China. The people coming over from China forged paperwork and took new last names to appear to be children of people already living in America.

That's why today many people of Chinese ancestry have both a paper last name, the name they used to come over, and their actual last name. Snackers, May is Asian American and Pacific Islander Heritage Month. We want your snack facts. Send them to us right here by clicking on the link at the top of this pod episode. We got a Google form there in the episode description. You can upload the audio file for us. In the meantime, Snackers, you look fantastic. Jack, your little baby is going to get some Robux in 10 years. I am so excited about that compounding interest.

You know, I charge a management fee for that interest. You know, I charge a finder's fee for this Robux account. If you're going to throw me a couple of Robux, I'll accept make some Robux. We'll see you about it. And before we go, Snackers, congratulations to Kayle and Brandon just got married down in Chicago, which does logistics.

Gemma and Brian took it one step at a time here. Move it in together. Okay. Upland California. Congrats. All right. Madison McDonald's, congrats on finishing the CPA over in Houston.

Ricardo Mendes just got a new job in Caracas, Venezuela. Meanwhile, Eduardo Garay just finished his Ph.D. Jack down in Honduras. Happy birthday to Chibuike in Lagos, Nigeria. And Cody Berry down in Whitefish, Montana. And Moran Benti, a midkid in Shachaman, Ethiopia. And Ursa, celebrating the 27th, down in New York. Happy birthday to share.

in Costa Mesa, California. And Nick Lavoy in Putnam, Connecticut. And Asta Cacker in Mumbai, India. And Luke Pillar in Portland, Oregon. And Diana Angelini's got a birthday. Yes, she does. She also has her whole women's investing group snacking on the pod. And where else, Jack?

Chicago. Doing logistics. This is Jack. I own stock of Roblox. Nick own stock of Beyond Meat. And Nick also owns some Ethereum named AFEL. The Robin Hood Snacks podcast you just heard reflects the opinions of only the hosts who are associated persons of Robin Hood Financial LLC

and does not reflect the views of Robin Hood Markets, Inc, or any of its subsidiaries or affiliates. The podcast is for informational purposes only and is not intended to serve as a recommendation to buy or sell any security and is not an offer or sale of a security. The podcast is also not a research report and is not intended to serve as the basis of any investment decision. Robin Hood Financial LLC, member FINRA, SIPC.