The Best One Yet - 🤏 “Zuck’s Tiny Taxes” — What Billionaires pay. New Balance’s surge. Ring’s puppy problem. +Jamie Dimon’s bar

Starting point is 00:00:00 This is Nick. This is Jack. It's Friday the real Friday. February 20th. 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. Oh, the envelope please.

Starting point is 00:00:14 Yeties, we have chosen the winners for our T-Boy itinerary sweepstakes for our Austin Live show. Of the 15 barbecue joints you recommended, we chose one that we're going to on Tuesday night. And of the thousand workouts you suggested, we selected one for Wednesday morning before the show. reached out to the Yetis who recommended them, and we want you to join us. So, check your DMs or check the comment on Spotify. We got your back. We can't wait to see you there. But in the meantime, Jack, we got three fantastic stories for today's pod. What do we got on the T-Boy? For our first story, while Nike's been marketing over at the Milan Olympics, New Balance is selling in record numbers back in Boston. New Balance made $9 billion, and it's all thanks to a plate

Starting point is 00:00:54 of scrambled eggs. For our second story, ring camera is a tool for mass surveillance? Get this, Amazon lost $250 billion this month because of that question and one cute puppy commercial. And our third and final story. The Wall Street Journal just came out and said that billionaire taxes aren't a political issue. They're an economic one. So Jack and I are jumping in T-boy style to Zuckerberg's taxes because Zuck's taxes are tiny. But Yeties, before we hit that wonderful mix of stories. Oh, I mean, what a mix to go into the weekend with no one else doing the mix, Jack. Nick, it's Friday the Real Friday. What's the hottest place to go out in New York City? I mean, is it employees only? Is it Feeves? Is it Dorians? Is it Dorsey? Nope. If you bring the right business card, Jack, the coolest bar in NYC is at JPM.

Starting point is 00:01:40 Specifically, the bar inside the new $3 billion JPMorgan office tower. The bar in this tower is called Morgans. It's on the 13th floor, but the line to get in goes all the way down to the 10th. We repeat, America's biggest bank is now running its most exclusive bar. It's a true story. It's a British pub theme, and the Guinness and the Guinness there flows like spreadsheets. But Jack, if you asked to split the G, they're going to think you're referring to a thousand bucks over there. You bet your card better be platinum. I got fish and chips for the mergers and acquisitions. Bagers and mash for the sales and trading over here. But the problem is that America's biggest bank miscalculated the demand for this bar. Because there's only 55 seats for the building's 10,000 workers. It's like some intern discounted the wrong cocktail cash flow. I mean, some analyst is definitely going to work till 2 a.m. on this one, Jack. So, J.P. Morgan's

Starting point is 00:02:29 Internal office bar is the hardest table in New York. Even if you work at J.B. Morgan, besties. A standard reservation, it's free. But instant reservation? It costs 5% of your tab or $25, whichever is greater. Remember, this is a bag. Oh, and if you try paying with your city card, they're going to put you in a doggie bag.

Starting point is 00:02:46 Oh, Sapphire or bust. You hear what Jamie Diamond said on the last earnings call, Jack? When you're in the club, we're all fam. Jack, let's hit on three stories. Fifteen years before this song, two boys from the Northeast met. in a dorm. They had an idea to cause a cultural storm.

Starting point is 00:03:02 It's the best one yet, but the best is an norm. 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. First, a quick word from our sponsor. For our first story, while Nike's all over the Olympics, its rival New Balance is seeing its business boom.

Starting point is 00:03:41 New Balance just announced that revenues rose 19% last year, and it's nearly three times bigger in sales today than in 2020. Jack, how are they doing it? One meeting every week. The Breakfast Club. Oh, Yeties. New Balance, the way Jack and I see it, it's the father of the dad shoe. There's no arguing that, actually.

Starting point is 00:03:59 This 120-year-old sneaker brand actually started as an orthopedics company in 1906. And before they got all into running, New Balance was founded just outside Boston and was made for factory workers. Yeah, they gave arch support for the guys fixing the long. lobster traps down at the docks. Yeah, hey, we're going to need another round over at the textile mill. Yeties, we promise that's the end of our Boston accent. But funny thing, Vesties, the term New Balance, it actually goes back, it goes back to the farm, doesn't it, Jack? Yeah, the New Balance founder bought some chickens and studied how the rooster was able to balance on the three claws of one foot. True story. And despite the gray suede vibes, over a century

Starting point is 00:04:37 later, New Balance is doing $9 billion in business right now. That is up 19% from last year. And this is the first time we've seen the sales of this privately held company. Yes, it is, but there's an even bigger shocker here, isn't there, Jack? Sales have nearly tripled since 2020 for New Balance, all while Nike has stumbled and tripped. Get this, in 2020, Nike was 11 times bigger than New Balance by sales, but today it's just four times bigger. New Balance is one-third the size of Adidas, the same size as Lulu Lemon. This dad's shoe has gone through puberty. Now, besties pause the pot for a sec, because you may remember on Tuesday, Jack and I covered

Starting point is 00:05:12 and endangered species on this show. Allbirds. Sadly, its stock is down 99%. Save the birds. But here's what we find fascinating yeties. New Balance is the same comfort concept as all birds. But unlike all birds, New Balance is embracing its ugly duckling era.

Starting point is 00:05:28 The dad's shoe became cool during COVID because New Balance owned it. Yes, we told you about the comfort economy. But New Balance is sneaker surge. It actually goes way deeper than that. Jack, any chance we got a sports analogy here we could drop on the besties for the show? Nike fumbled. So New Balance picked up the ball and ran it to the end zone. It was a scoop and score situation.

Starting point is 00:05:47 And here it was Nike's original sin. They pulled their shoes at a third-party retailers like Foot Locker so they could sell direct-to-consumer online in their own Nike stores. So New Balance simply filled the void. They loaded up Foot Locker with boxes and boxes of Swade 990s, which sold way more than before. Okay, that was step one. Then step two for New Balance is they went Primo. They went upmarket premium. They did luxury collapse to associate New Balance with Gucci instead of the gridiron. And that cultural cachet and that cool factor, it let New Balance increase their prices by 30% over the next five years. And yet you and Justin Bieber both paid for that price your shoe anyway. Which leads to the third part of New Balance's master plan. That cultural cachet allowed New Balance to pick the best athletes for endorsement deals, something Nike is historically the best at.

Starting point is 00:06:35 Show Hey Otani, Cocoa, Josh Allen, all of them, Team New Balance. So now New Balance is saying, hey, Nike, go ahead and take the Olympics, enjoy the spotlight, the medals, the podium, and all that. Have fun up there. We'll be at Paris Fashion Week, and we'll be on Cooper Flagg's feet. Yeah, the number one NBA draft pick, he's also a New Balance guy. And he'll also probably get an invite. And I'll also get an invite to Paris Fashion Week. So Jack, what's the takeaway for our buddies over at New Balance?

Starting point is 00:07:02 New Balance's success is thanks to the breakfast meeting. Scramble eggs and sneakers. Yeties, let's go back to April 2020, right out. After COVID hit, New Balance's CEO started a weekly meeting that was mandatory for all leaders at the company. Every Tuesday at 7.30 a.m., the leaders had to zoom into a breakfast meeting. Yes. An early meeting let them have an offensive mentality for the rest of the week. And you know what?

Starting point is 00:07:26 They continued that Tuesday morning meeting all the way through the pandemic and they still do it today. Scramble eggs and sneakers, Tuesday at 730. It's a New Balance institution now. Now, here's why that's interesting. Nike's former CEO blamed their remote workforce for lack of innovation. there's no creativity when there's no connection. But New Balance's CEO says the opposite. That one meeting they found during the pandemic,

Starting point is 00:07:46 it set the stage for their best leg of growth in company history. Now, Basties, we know, all meetings can be annoying, remote or in person. There are too many of them. They get abused. It's an easy corporate punchline joke. But a single meeting consistently done with the right people at a smart time? That's New Balance's $10 billion breakfast club. Scrambled eggs beats swooshes.

Starting point is 00:08:10 For our second story. Ring's cute puppy commercial from the Super Bowl sparked a crisis on surveillance. Basically, one cute puppy cost Amazon billions. Amazon learned this critical lesson the hard way, but you can learn the same lesson the easy way. Now, Yeti's earlier this week, Jack and I discussed Budweiser's three Super Bowl commercials that were all really highly rated. Well, Ring's Super Bowl commercial was poorly rated. Yeah, so poorly rated, it actually raised billion dollars of value from Amazon stock. The Super Bowl commercial highlighted a new feature on Ring called Search Party to help people find their lost dogs. It was a cute puppy commercial starring a digital ring doorbell.

Starting point is 00:08:49 How did the commercial go, Jack? One post of the dog's photo in the Ring app starts outdoor cameras looking for a match. Search Party from Ring uses AI to help families find lost dogs. Jack, it sounds charming, feel good, I feel like it's lassie, two point. Oh, how were the reviews? Then the reviews came in. That's straight up surveillance. state right there. They're using dogs and dogs missing to launch a surveillance state, man.

Starting point is 00:09:14 With ice patrolling, people said the thousands of ring cameras in a town could be used against citizens. So, Amazon stock fell each and every of the next five days after that ad. It's now down 16% in February so far. Amazon probably hoped to run that Super Bowl ad in the Olympics. Yeah, they did. Instead, they destroyed the tapes of that commercial. Wow, Jack. Not what the ring doorbell team thought they'd get with their first Super Bowl commercial. Yeah, knock, knock. Who's there? A full-on PR crisis.

Starting point is 00:09:44 Now, the CEO of Ring Doorbells did clarify the situation, besties, that Ring owners don't share information to search party by default. It's all up to the user. And then he clarified that Ring doesn't store users video footage if they don't have a subscription with Ring. But that second part was not the case with Savannah Guthrie's mom in Arizona the last week, was it, man? No, the FBI got footage of Savannah Guthrie's camera from her Google. Nest, even though she reportedly didn't have a subscription. So, Jack, that inconsistency, plus general

Starting point is 00:10:14 anxiety around AI, plus acute anxiety about ICE added all up for me, my friend. The Ring puppy commercial was a perfect storm of distrust, conspiracy, and brand bruising for Ring. And it caused Amazon's ring last week to end its partnership with Flock. Flock, which uses AI-powered surveillance cameras to read license plates and feed the information to police. Ring is done with that partnership. Sorry, Jack, let's step away from the doorstep for a moment. Remember, Ring just wanted to evoke your love for your dog and pull on your heartstrings with that puppy. Instead, Ring's Super Bowl commercial revealed that Rings actually involved in a police AI surveillance network. Yeah, that was not in the KPIs, man. Not in the KPIs. So Jack, knock knock. Who's there again? What's the takeaway for our buddies over at Ring? With mistrust at all-time highs, marketers need to ask about the WIP. What's the one?

Starting point is 00:11:09 Worst interpretation possible. Yeties, the Epstein files, insider trading on prediction markets. AI, deepfakes are your buddy who is hanging out with your buddy and you didn't get invited to the party. Conspiracy is just everywhere right now. It feels to us that trust is at an all-time low. And marketers need to realize that and adjust accordingly. You see, people love their own ring camera, but they are suspicious of surveillance cameras

Starting point is 00:11:32 generally. Ring burned customer love last week they earned with the former by flirting with the latter. Now, could rings be used to help? help fight crime? Yeah, totally. But could they also be used to infringe on our rights to privacy? Also, yes, totally. And here's the problem. Ring was excited by the former but didn't pause to think about the latter until a crisis broke out. Ring learned the lesson the hard way. Every marketer out there can learn the easy way by listening to this story. Yeah, with mistrust at all-time highs, marketers need to ask about the whip, the WIP, the WIPP, the worst interpretation possible.

Starting point is 00:12:04 Watch out for the marketing whip, because if you don't, a viral TikTok video will tell you about it. Now a quick word from our sponsor. For our third and final story, Zuck's tiny taxes. Billionaires in America are paying an income tax of zero. It's not us saying that. It's the Wall Street Journal. Because this isn't political. Zuck's tiny taxes threaten our economy.

Starting point is 00:12:31 Now, yet he's Jack and I were prepping for today's show. And we read this Wall Street Journal headline that we just assumed was written by a progressive opinion columnist writing into the journal. But it wasn't. Here was the headline. Billionaires, low taxes are becoming a problem for the economy. Okay, that was the number one most shared article on the Wall Street Journal yesterday morning. True story. And it was news reporting, not an opinion article.

Starting point is 00:12:53 No, true. Now, it is true that the top 1% of Americans pay 40% of all federal income taxes. Okay, but Jack, the top 1% of that 1%? Those in the Forbes billionaire rankings? They pay zero in income taxes. And the reason why, it's our tax code. When it was written, they didn't fathom what, Elon and Zuckerberg would do. And Jack, what do Elon and Zuckerberg do in particular? They pay themselves

Starting point is 00:13:17 a salary of just $1. Yeah, besties, to quote the notorious B-I-G, more money, more problems, less taxes. Which brings us to Zuck's tiny taxes. They're largely thanks to Zuck's tiny salary. You see, every two weeks, Zuck gets a paycheck over at Meta for three cents. That's it. After taxes, it's probably one cent. Yeah, you know how it goes. Now, Elon actually takes a $0 salary Tesla to be their CEO. So Elon is paying $0 in income taxes right now. Now, for both, you might think initially, wow, what a great guy. They're already rich, so they're working for free. Not too shabby. Zuck just doing his thing, nice guy. But the reality, this isn't philanthropy. This is strategy. Exactly, because these particular billionaires derive their wealth from stock and stock bonuses

Starting point is 00:14:03 for tax reasons. That's why the billionaire class can get $10 billion richer in one year and only pay tax if they sell stock, which billionaires have learned not to do. Jack, why don't you whip out the whiteboard here? How exactly is this strategy breakdown? When a billionaire needs cash to buy like a fifth home, they don't sell the stock that they own. Instead, they borrow cash using their stock as collateral. And here's the key. The interest that they owe on that loan, it is way less than the capital gains taxes they would have paid if they'd sold the stock. And here's what their accountant tells them. Just keep doing this until you die. So you can pass as much wealth as possible to the the next generation. In fact, this strategy has a name. It's called Buy, Borrow, Die. And we'd love,

Starting point is 00:14:47 if you walked into your local H&R block and asked, can I have the Buy, borrow, die plan, please? Carol from accounting, she's going to sit down, stand up, and she will stay seated after that one. And Nick, this Buy, Borrow, Die tax avoidance strategy, the result is that America's 400 richest people pay half the effective tax rate of a simply normal wealthy person. Translation, And the stupid wealthy are paying 24% effective tax rates if you include all the taxes. While the regular wealthy are paying a 46% effective tax rate. You see, Bessies, it's understood that you pay a higher tax rate the more money you make, but only to a certain point.

Starting point is 00:15:23 Once you hit the three comma club and become billionaire rich, we're talking second boat for your third house that lives on your fourth yacht. You stop taking a salary, you take stock as compensation instead, and your income tax disappears. And Bessies, this is all legal because our tax code just never was able to account for the billionaire accounting schemes. And our Congress hasn't moved to change that reality. So billionaires don't dodge taxes. They dodge income. That's the trick. They don't dodge taxes. They dodge income, which leads to our takeaway. So Jack, what's the takeaway for our buddies

Starting point is 00:15:54 hanging out in the three comma club? Why is this bad for the economy? Well, because you can't balance a whole economy on a burkin bag. Now, yeties, there is a political conversation around whether this kind of wealth inequality is okay. That conversation is happening in California and New York right now, which have momentum to tax the rich. And in Florida and Texas, it's already happened where they welcome the rich with no income tax. But interestingly, the Wall Street Journal, a historical champion of low taxes on the rich, is calling Zuck's tiny taxes an economic problem. Because our economy is unhealthily dependent on the spending of the mega wealthy right now. I mean, look, this tax situation is great for Cartier-A-N-Air maze, but is a huge risk to the rest of the economy. If the stock

Starting point is 00:16:34 market tanks, and the wealthy feel less wealthy and stop spending, that could spiral us into a bad recession. Besties, our economy, it has been robust in the past, able to handle economic shocks and shakes. But if it depends on the Uber wealthy buying another private jet for their Birkenbag, that's a fragile economy. Jack, could you whip up the takeaway sports for the real Friday? New Balance sales rose 19% in 2025, while Nike sales fell 10% the same year. New balance has tripled in size since 2020, thanks to their... Tuesday morning breakfast club. For our second story, Ring's security camera has put its owner, Amazon, in a PR crisis around surveillance. Ring, they didn't watch out for the whip. The worst

Starting point is 00:17:16 interpretation possible. And our third and final story, the Wall Street Journal highlighted the buy, borrow, and die tax avoidance strategy, popular with billionaires. The result, our economy's fragile, like a $50,000 air maze pendant necklace. Can't balance an economy on that thing. But besties, this pod's not over yet. Here's what else you need to know. today. First, we just got the government data confirming that the U.S. imported more goods in 2025 than ever before. That is surprising because the presumed goal of the tariffs were to encourage us to buy made-in-USA goods instead. But it's also unsurprising that the opposite happened because tariffs are widely known to be an ineffective tool for accomplishing that. Now, we should point out that

Starting point is 00:17:56 in services, not physical goods, the U.S. has a surplus like we usually do. Movies, music, tech, America's biggest export is culture. For our second story, it's one bright detail from the avalanche ski tragedy over in California, and it has to do with the iPhone. That's right, because six surviving skiers were saved by the iPhone SOS feature. They were stuck under the snow without cell service, but they pushed that emergency button on the iPhone, and it got satellite signal to send a 911 message.

Starting point is 00:18:27 That iPhone saved their lives. And finally, the grandson of the founder of Reese's Peanut Butter Cups, You would like to have a word, Jack. Brad Reese, who's 70 now, but the grandson of the founder, said, I just can't let this go. They're lowering the quality of the ingredients. They're charging the same price. This is skimflation, and my peanut butter heritage won't have it. That's right.

Starting point is 00:18:50 So if you dive into a Reese's peanut butter cup this weekend, and it doesn't have that, like, salty taste like usual, you're on Team Brad. You know what's going on here, guys. Side note, we did an episode on the origin of the Reese's peanut butter cup in our other show, the best idea yet. Oh yeah, yeah. The founder and inventor, he was a frog salesman. Spoiler. And that episode is Jason Kelsey's favorite episode. According to people familiar with the matter. So facto, it's Taylor's favorite. Now time for the best fact yet. This one whipped up by Jack and I to hand you into the finale of the Olympic Games. First, quick celebration. Team USA women took down Canada yesterday for the gold medal in hockey. Yeah, we beat the not Montreal Canadians, like the

Starting point is 00:19:30 Canada. Canadians, the official ones, the real ones, the big ones. Now, the captain for the team USA women is Hillary Knight. Interesting. This is her fifth Olympic medal for hockey, second gold to go with her three silvers, not too shabby. And get this, the day before the championship game against Canada, she proposed to another athlete on Team USA to marry her. That's right, an American speed skater, Brittany Bow. She is now getting married to the captain of the American hockey team, who just won the gold medal in the Olympics. And together, the fastest couple on ice. The men playing the semis later today. We'll see you there. Yiddies, you are looking fantastic for the real Friday. Jack, you are glowing over there, my friend. I can't wait to see you next week. I know. I'm flying to

Starting point is 00:20:15 Austin. This is exciting. But in the meantime, besties, it is five-star Friday's best way to help grow the show. Drop down, give us five stars in review. Honestly, Jack and I spend all week in reading him. We love seeing what you're saying. And Nick and I will be back for you on Monday with the best one yet. Diamond takes your Chase Sapphire Chardonnay at the bar tonight. Don't say we didn't warn you. All right, great. I forgot to do that. And before we go, a happy birthday to legendary Yeti, Logan Rooney,

Starting point is 00:20:46 huge fan of the best idea yet celebrating the birthday on a trip to Vietnam and Japan. And happy birthday to Chandima Hiramette, who's celebrating the birthday on a commute from San Jose, a legendary Yeti since 2018. And Harvey Snyder is turning 10 years old at Disney World. Harvey, we love getting you that birthday shout out. every single year. Happy birthday to Haley Choi in Chicago. Doing logistics and Chase McElroy, legendary Yeti, Scott a birthday in Costa Mesa. Happy birthday to Jen Tan in the Bay Area. And the best

Starting point is 00:21:13 brother, dad, and husband out there, birthday boy Tim Dunn has got a birthday down the street in San Francisco. Happy birthday to Myra Mercy. The entrepreneur, legend, and Seinfeld fan of Spokane, Washington is turning 41. And Evander Neumann is turning two years old on 222 in the Poconos. Now that are some good twos. Congratulations to Chris and Caitlin. who just got engaged at Zion National Park. And we can't wait to meet you guys at the Austin Live show. We'll see you next week. Congrats guys.

Starting point is 00:21:40 And congratulations to Sidney, who's going full Zamboni and Freezing her eggs in Stanford, Connecticut. Congrats, Sydney. And Cool Keith just had his first ever acquisition by an operating company in Calgary, Canada, after 20 years, finally on the other side of the desk. And happy birthday to John Wood in Boulder, Colorado. And he just started working with his entrepreneurial wife,

Starting point is 00:22:00 New York Times bestselling author Jenny Wood, writer of wild courage. And finally, a bun voyage to Savannah Westwood, the legendary Yeti traveling from Florida to Austin to hang with another legendary Yeti Kelsey Black at our live show in Austin. Celebrate the wins. This is Jack. Nick on stock of Lulu Lemon and Nike. I own stock of Amazon, and we both own stock in Apple.

The Best One Yet - 🤏 “Zuck’s Tiny Taxes” — What Billionaires pay. New Balance’s surge. Ring’s puppy problem. +Jamie Dimon’s bar

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