The Best One Yet - 💏 “The NYE surprise hookup” — Netflix’s Nike kiss. Southwest’s dirty secret. Our 2023 stock market prediction.

Episode Date: January 3, 2023

The first surprise new relationship of 2023? Netflix and Nike — Workout and chill. Southwest suffered the worst airline breakdown in history because of its dirty secret: Technical Debt. And 2022 was officially the worst year for the stock market since 2008… so we’re looking ahead to 2023.$NFLX $NKE $LUV $SPYFollow The Best One Yet on Instagram, Twitter, and Tiktok: @tboypodAnd now watch us on YoutubeWant a Shoutout on the pod? Fill out this formGot the Best Fact Yet? We got a form for that tooLearn 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. It's Tuesday. Teaboy Tuesday. We're back January 3rd and today's pod is the best one yet. I am still in Florida for a couple more days. How is Florida going on down there? We were on the beach six straight days. Can you talk to me about the sandcastles? I heard about the sandcastles. The sandcastles had sandcastles. Wilder would not let go of his shoveling pal. Now that is a sandcastle. How was Japan though, Ned? Jack, Japan is. living in the future. Have you heard about the toilet seats in Japan, Jack? What about the toilet seats? Every toilet seat is heated, including on the trains. You're telling me they have bullet trains with self-heating toilets in the bullet trains. On the bullet train, I went into the bathroom, sat on the toilet just to warm up. Yiddies, it is great to be back. We hope you had a fantastic break. The first pod of 2023 is our best pod of 2023. What's our first story next? Jack, hit me what we got. A shocking new partnership. Nike and Netflix just partnered up to win your New Year's resolution. Yet as we repeat, Netflix just hooked up with Nike.

For our second story, Southwest Airlines canceled just about every flight during the busiest travel week of the year. Because Southwest Airlines keeps a dirty secret in the middle seat. And our third and final story, 2022, was the worst year for the stock market since 2008. So Jack and I are dropping one more stock market prediction for 2020. But Yeties, before we hit that fantastic mix, I love coming back to this mix. This is honestly the best mix yet. I love this mix. We have some big news to kick off the best one yet for 2023.

Jack, we're going to have to get you a mini microphone over there. Make that two mini microphones because we've got a baby joining the T-boy family this year year. Yeties, Jack and Alex are having another kid over there. Not too shabby. I'll tell you, Wilder, the Podson. Yeah. He joined this family in 2021. Talk to me. Now Wilder's getting a baby bro.

Jack Wilder's going to have to sit down, stand up, and crawl back down again over there. Yeties, our first kid is getting sucked by our second kid. Jack's family is literally growing faster than the U.S. economy. The things I bought for the second nursery, I'm contributing to the U.S. economy big time. Yeah, you nailed the timing here with the inflation prices for diapers. So, Jack, what's the takeaway for our buddies over in the family? We've got ourselves a T-boy baby boom. Yeti's Jack's baby is IPOing in March.

Yep, my New Year's resolution, build another bassinet. Jack, can you make that a self-rocking bassinet with an electric chassis? That would be lovely. Yeti's baby number two is due in March. And just like baby number one, we're going to take time off to let Jack remember how to swaddle when that time comes. We'll share more details on the baby break in the coming months. Besties, we couldn't wait to update you on the T-boy Baby Boom. And if you're wondering, Alex is handling pregnancy like a chair.

Let's hit our three stories. First word, Boona. Fifteen years before this song, two boys from the Northeast met in the dorm. They had an idea that caused 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 ready to go. We can't wait no more, so just start the show. Start the show. For our first story back, The surprise hookup of New Year's Eve? Who wasn't, Jack?

It wasn't Nathan and Nicole. Although we all thought it was going to be. The surprise hookup of New Year's Eve was Netflix and Nike. Nike just added 90 episodes of video fitness content to Netflix. Oh, Jack, we should sprinkle on some context here. Everyone knows your New Year's resolution. We all do the same thing. Get an eight-pack by April.

You cannot walk into a dinner right now without someone telling you about their trainer named Todd, who they just love. Or the Peloton that got for like 90% off on Craigs. Full disclosure, yeah, we still own the stock. In the meantime, Yetis, instead of doing one of those trainer things, check out this new situation. Open up the Netflix app right now and search for the word fitness. Now, if you search for fitness on Netflix right now, here's what you're going to see.

You're going to see a swoosh. Because Netflix's newest series is not a Squid Game spin-off or Squid Game Season 2. No, it is not. It is 30 hours of fitness content. From Nike. From Nike. We're talking about material that will get your heart rate higher than that last episode of the Crown. It's 90 episodes and it's basic workout videos that require basically no equipment.

Also, they dubbed this fitness material into 10 languages on Netflix. So you can get like Hans and Franz to yell at you to pump it up. There's just nothing like a German accent motivating you to do burpees, is there, Jack? You feel obliged. We tested this out this morning for our workout routine. Jack and I jumped in T-Boy style, and we literally did this to make sure it was legitimate enough to cover on the podcast. Right there, on the living room floor, we did the booty burn workout, doing some donkey kicks and fire hydrants. Yeah, we did. We did it with Kirsten Godin, the new Australian trainer over at Nike.

It was a quality product, but it made Nick and me think this has huge spinoff potential. I mean, Jack, can we talk about the potential future content out of this Netflix and Nike deal? Richard Simmons is the celebrity fitness instructor Nike needs right now. You gotta squeeze those buns, Jack. Can we get a Jane Fonda special? Is that too much to ask for? Now, Yetis, we said that 2022 was the year that Netflix stopped being Netflix. At the end of last year, Jack and I were saying Netflix just didn't look like Netflix last year.

Well, this new story makes that official. Yeah, because last year, Netflix lost subscribers for the first time ever. Last year, Netflix launched ads for the first time ever. Last year, Netflix debuted in movie theaters for the first time ever. And last year was also the first time that Netflix stock fell and it fell bad. Now, it looks like the era of Netflix and Chill is officially over. On the last day of 2022, Netflix replaced the chill with some mason twists. Netflix's business model depends on you being on a couch.

But right now, Netflix is like literally, get off the couch. Get off the sofa. No, no joke. You put on the fitness video, you have to get off the couch. Step on the scales, Jimmy. Step off the scale, Jimmy. Now, Vessie, Jack and I were looking at this situation. We're like, yeah, this is an obvious win for Nike.

The Netflix user base is huge. And now Nike is going to get some nice branded content in front of 223 million subscribers. But here's the big question. What's in it for Netflix? What's in it for Netflix? Feels like a takeaway burn. So, Jack, what's the takeaway for our buddies over at Netflix? When you own habits, you own heartbeats.

Yeties. Netflix is real market. It isn't streaming. It's the attention economy. And the attention economy is hard. Even if you win someone's attention, it's ephemeral and that attention slips away tomorrow. For example, Netflix dropped $18 billion on content last year, but then your attention faded after every season finale. New shows will win your attention for a week, but they're not going to win your habit. On the other hand, fitness, that's a power habit, Jack. Fitness is your morning routine. It's your weekly regimen. It's your annual New Year's goal. Besties, if this Nike content keeps burpee, Betty, subscribe to Netflix, that's a win for Netflix. For Netflix, Nike fitness videos are their first move into habitual video content.

Because when you own habits, you own heartbeats. For our second story, the biggest travel travesty in years is Southwest Airlines. Southwest, you updated your software, right? Yeah, did you get that update? Oh, you didn't. Oh, they didn't update the software check. Yet he's everyone's got a holiday travel story or several. You can't stop hearing about them.

Someone lost their dog, then you lost your bag, then you lost your sanity. Now, fortunately, I wasn't flying Southwest Airlines to Florida. But River was in her travel bag, the little puppy bag, three hours longer than planned, and it stressed me out. You know what would solve every travel travesty? Doggy Zanax. You had heated toilet seats like on the Japan bullet trains. Yeties, nothing tops the mess like the Southwest travel mess.

What happened at the end of December was the worst travel travesty in the history of vacations. Worst travel travesty since the Wright brothers. Get these numbers about Southwest. From December 22nd through December 31st, 15,000 flights were canceled just on Southwest. You could not even get. Get a Biskoff cookie. Jack and I jumped in T-boy style. Jack, can you share the numbers on this thing? Whip out the whiteboard for us? Southwest only flies 737s, which have about 200 seats per airplane. So 200 passengers times 15,000 canceled flights. That is 3 million passengers whose holidays were ruined just on Southwest.

Three million affected tickets. We're talking families from Cincinnati that had to spend Christmas in Sacramento where they don't know anyone because of Southwest. They were on the airport floor. Yeah, they are. Oh, what about the weddings, Jack? Can we talk about the holiday wedding? Brides and grooms missed their weddings because their luggage was in Des Moines and they were in Duluth. Honestly, Jack and I were just running out of cities at this point. Get this.

Over the holidays, nine out of ten flights canceled in the United States. What airline were they, Jack? It was Southwest. We heard about all those canceled flights. Nine out of ten of them were Southwest. Southwest, more like South Worst. We are talking about an incredible hit to customer loyalty and satisfaction and what has happened to Southwest stock, Jack. It's down about 6% last week, which means it's down 50% from its all-time high.

Now, yet here's what Jack and I find fascinating about this story. Every airline was facing the same issue with Southwest Airlines. That gigantic winter storm that swept the entire country. And yet, it was only Southwest Airlines that imploded despite, everyone facing that same issue. Get this, on December 29th, nearly a week after the storm had passed, Southwest was still canceling thousands of flights per day.

And we repeat, every airline had the same issues as Southwest. Now, one issue is that Southwest is the only major airline not using the hub and spoke model. Okay, but here's where things get interesting. The data shows a strange phenomenon happening with Southwest Airlines. Over the last decade, Southwest's on-time percentage, has been getting worse and worse and worse. According to CNN data in the past 10 years,

Southwest cancellation rate has tripled. Now, one out of three Southwest flights arrive late. If you're on a Southwest flight, one out of three of those flights is not gonna make you happen. So what is it about Southwest that caused this travel travesty? Well, we know what it is about Southwest that caused this travel travesty. Because disappointed and disgruntled employees told us.

And they've been saying it silently for years. So Jack, what's the takeaway for our buddies over at Southwest? And yes, I know I just said saying it silently. The scariest debt. It's not financial debt. It's technical debt. Technical debt. Yeties, we all know about financial debt.

But technical debt can be just as harmful even though we don't talk about it. Technical debt is when for years your organization neglects its systems and fails to update its software. Yeah, technical debt. It's when a company's business grows, but its computer systems don't grow with it. For 25 years, Southwest has accumulated a ton of technical debt by not updating their system. They haven't updated their computer system. Southwest is the floppy disk of Flying Jack. And last week, those years of technical debt came due.

And it was a disaster. Southwest Airlines is the landline of airlines. For 10 days, Southwest didn't know where their pilots or flight attendants were. For 10 days, Southwest had the wrong suitcases in the wrong airports for the wrong people. And the reason, the organizational systems, the scheduling software, it was all 25 years old and it snapped under the pressure. The outdated computer systems were technical debt. We all know about financial debt, yeah, we do. But technical debt can be just as harmful.

Now a word about our sponsor, Robin Hood. A lot of Yetis don't realize how much prep work goes into this pot. We spend hours every morning jumping in T-boy style to earnings reports, CEO tweets, breaking news, heavily. Jack and I are toggling tabs like you toggled IM Convo's in 2004. Having eight tabs open can be stressful. You don't need that, especially when invest. Robin Hood offers it all in one app. Whether you want to trade options, ETFs, or stocks through Robin Hood Financial,

or you want to buy some Bitcoin on Robin Hood Crypto. You can do it all. all on the Robin Hood app. If you're not investing in Robin Hood yet, to get started, go to robin hood.com slash T-boy and choose your free stock. That's robinood.com slash T-B-O-Y. Limitations apply. Robin Hood Financial LLC, member SIPC, all investments involve risk.

By the way, this podcast is not owned or part of Robin Hood. We are not employees of Robin Hood. For our third and final story, the stock market fell 20% in 2022. That is its worst year since 2008. But we've got one more prediction left. and it's for 2023. Okay, Jack. Everyone makes fun of our Peloton stock fall 90%.

But how about the rest of this stock, man? You know what? I think only you and I make fun of our Peloton stock, actually. We are the only two people who lost money on crypto. It's actually kind of impressive, Jack. We haven't lost weight on Pelotons. No, that's true. We have lost money, though.

Yeties, the 500 biggest stocks in the United States fell 20% on average in the last year. Stocks, bonds, crypto. real estate, your Uncle Ed's stamp collection. All of it. Everything fell in value last year. But Jack, can we sprinkle on a little context here, my friend? Please.

If you zoom out just a little on the stock market, just a little bit. It's actually been a pretty decent past three years. Hey, Yeti, since the end of 2019, the S&P 500 stock index is actually up 19%. That's 7% per year. Not bad. That's not that bad.

That's not bad. Not that bad. But here's the funny thing. Nobody cares about last year and nobody cares about the last three years. You all want to know what's going to happen in 2023. Everyone wants to look ahead and hear what's happening next year. While for next year, Wall Street analysts are split. So Jack, what are the bullish analysts on Wall Street thinking? The most bullish investment bank thinks that the S&P 500 is going to rise by 10% this year. But Jack, what's the most bearish of analysts think? that the bear market is going to get more bearish. They're expecting a 17% further drop in 2023. This is like a really annoying weather forecast where the weatherman saying there is a chance of thunderstorm, but it's going to be sunny out there. But there's one thing that Wall Street isn't split on. That's a good point, Jack.

Yeties, there is one thing that analysts are very certain of, in fact. More layoffs. Yeah, more layoffs. Because when stocks fall, CEOs fire. And last year, about 100,000 people were laid off. just in the big tech companies. Jack, can we whip up some of the other numbers here? They were shockingly big. 10,000 were laid off at Amazon. 11,000 were laid off at meta, and they're expected to continue this year. It's affected friends of ours. It's affected the entire industry. It was like

the dominant theme in tech last year. And that dominant theme of 2022 has us thinking about 2023. It has this thinking about a takeaway. So, Jack, what's the takeaway for our buddies over in the stock market? Our 2023 stock market prediction is that big tech becomes profit puppy again. Like, yeties. Layoffs are awful. They're terrible. But there is one upside to layoffs for companies,

and that upside is leanness. Investors love lean companies, because a lean business is a more profitable business. So Jack and I are thinking that the big tech layoffs of 2022 are going to mean big tech profits in 2023. And we've got some precedent. We saw the same exact phenomenon after the 2008 financial crisis. We do. Just like last year, when the economy got crushed in 2008, CEOs laid off millions.

But just a couple years later, leaner companies were setting record profits. Get these numbers. By 2011, American companies were making 33% more profit than they ever had before. Now, as we enter 2023, the tech industry will probably continue laying off workers. But history shows that leanness can result in record profits. So our 2020-story stock market prediction, big tech once again becomes a profit puppy. Jack, can you whip up the takeaways for us for the first pod of 2020? Nike has produced 90 episodes of fitness videos for Netflix. Because when you have a customer's habit, you have a customer's heartbeat.

For our second story, Southwest, caused the biggest travel travesty in all of vacation history. Brutal because 25 years of technical debt, Just came due. And our third and final story is the S&P 500. It was down 20% in 2022. What about 23? So we're predicting that big tech will become a profit puppy once again. Now time for the best fact yet.

This one sent in by Scott Lacey from lovely Aspen, Colorado. Push and play. Here we go. Happy New Year's T-Boy listeners. Here is a quick best fact yet about the naming of the month January. January is named after the Roman god. God of doors and transitions, Janus. Janice has two faces, one facing forward for looking into the future and one facing backwards

looking into the past. Janice and the month of January represents our transition from this past year into the one we are looking into now. I hope everyone out there is off to a tremendous start of 2023. Cheers. I mean, you got to respect the Romans for having a God for furniture. The God of doors, that is impressive. And transitions. Not too shabby. I like a combined both it's deep and of course the god of february is just messing with us by sticking an r in there that no one knows about classic february yettys you'll look fantastic to kick off the year jack that was honestly just the most fun recording yet definitely the best episode of 2023 jack and i will see you tomorrow and before we go happy

birthday to yetty jackie jackie marino from the upper west side and happy birthday to big j b blank in New York City. And Uche Chalaka, happy 37th birthday over in Columbus, Ohio. And happy birthday to Cojo Beko in Sicklerville, New Jersey. And Brandon's story is turned in 26 over in Cincinnati. And a big happy birthday shout out to Pre 2 down in Dallas. Oh, and Jack, we got a belated birthday to Roberto Carlos Chiquese down in Brooklyn. And happy three-year anniversary to Big Nick Marino and Alexa Nor. No one has worn a sequin tuxedo quite. like that couple. And to all the Yetis who sent Tokyo food recommendations from ramen to udon, to sobah, to terri, to tempora, to tempora, thank you. They were all delicious. And to anyone else

who celebrated something today, make it a te boy. Celebrate the wins. This is Jack. I own stock of Amazon and Netflix, and Nick and I both own stock of Robin Hood and Peloton, and we both own ETFs of the S&P 500. Now a word about our sponsor, Robin Hood. A lot of you listen to our show, while you're driving. Two hands on the wheel. Keep it 10 and 2. You might be cruising, Chris, no rush. Stay in the right lane.

Or you might be doll lane from Duncan, dotting from lane to lane. And there are different drivers on the road. They're different investors too. Maybe you're cruising down the long-term lane with stock investing, or maybe you're a more advanced full-speed trader. Well, the Robin Hood app helps put you in the driver seat wherever you're at in your investing journey.

If you're not investing on Robin Hood yet, to get started, go to robinode.com slash T-boy and choose your free stock. That's Robinhood.com slash TBOY. Limitations apply. Robin of Financial LLC, member SIPC, all investments involve risk. By the way, this podcast is not owned by or part of Robinhood, and we are not employees of Robinhood.