March 1, 2023

The Appetizer

“If the number of hay fever patients rise due to this spring’s mass pollen dispersal, the negative effects could increase further. The possibility that pollen may cause unexpected damage to the Japanese economy can’t be ruled out.”

• Dai-Ichi Life Chief Economist Toshihiro Nagahama

Now, on to the numbers. Drum roll, please …

• $63,356.40: How much a brand-new, still in the box, first-generation iPhone sold for at an auction, more than 100 times its original price.
• 43.5 inches: The max vertical jump of 6’2” Mac McClung, the 2023 NBA All-Star Slam Dunk Contest winner.
• $326: How much lower the average tax refund is so far compared to last year.
• $50 million: How much a 1,000+-year-old Hebrew Bible could sell for at an upcoming auction.
• 8%: The decline in value for luxury Swiss watches last year, outperforming the S&P 500 by more than 10 percentage points.
• $16.9 trillion: The amount of debt U.S. households owed in fourth quarter 2022. The quarterly increase was also the largest in 20 years.
• 69%: The percentage of S&P 500 constituents beating earnings for the fourth quarter.

Dig In
or Should We Say Plug In:

Autonomous vehicles (AV). Electric vehicles (EV). Same thing, right? There’s been so much excitement in the auto industry recently that you may have missed that they’re actually two separate innovations.

EVs have been around for a long time … since at least 1834. They use electricity to power an electric motor, which makes the vehicle go. Improved performance, cheaper batteries, and subsidies from governments around the globe have led to the current EV rise.

On the other hand, autonomous vehicles use technology to replace some, or all, of the human input for operating a vehicle. While not as old as EVs, AVs have been in development since the 1980s. In fact, you’ve probably used some features in your own car already. Cruise control, anyone?

The current AV hype focuses on fully autonomous vehicles that can drive themselves by using technology and sensors to avoid road hazards and adapt to changing traffic conditions. But there’s still some bugs – just ask Tesla, as they work to figure out stale yellow lights. Other limitations include sensor performance in bad weather, high costs, and societal acceptance of driverless vehicles.

Nonetheless, hold on tight – we’re getting closer.

Weekly Specials

You’ve heard about soft landings and recession as potential paths for the economy lately. Some outlets are talking about a third path: “No landing.” No landing is a scenario where global economic growth is resilient and inflation remains higher. At Stifel, we still see a reasonable chance for a soft landing, with the consumer being a deciding factor.

Spring break is right around the corner, and the cost of travel is up. Travel app Hopper reports March and April round-trip airfares have increased 20% compared to last year, and 5% over pre-pandemic levels. Airlines claim that pilot shortages and delays in airplane deliveries limit capacity and are driving up prices.

Ben, a 300-pound Andean bear at the St. Louis Zoo, acquired a taste for freedom when it escaped its enclosure in early February. The bear liked freedom so much, that it broke out again last week by tearing through the stainless steel reinforcements added to his enclosure. Zoo officials are working on alternative ways to secure the adventuresome bear.

Everyone’s favorite purple dinosaur is coming back. Mattel is relaunching the Barney franchise with a series of television, film, and YouTube videos alongside a line of toys, books, clothing, and accessories.

Subscription services seem to be everywhere these days – the average American has almost seven subscriptions – and restaurants increasingly want to get in the game, too. For many, the subscription model is a way to ensure customer visits and increase steady revenue. For example, when Panera launched its monthly coffee subscription, restaurant traffic increased and led to greater food sales.

Britain’s four-day workweek trial appears to be a resounding success for both employers and employees. Workers reported less burnout, lower stress, and greater job satisfaction, while their 61 companies – representing industries across the board – saw no drop in revenue, better employee retention, and fewer sick days taken. 92% of those companies report that they’ll continue with the four-day week.

Corporate Lunch

United Airlines is introducing a new family seating policy, which allows their new system to find available adjacent seats for families and open up complimentary upgrades…who said technology takes away family time?

Intel announced it will be cutting back its dividend by over 65% in order to preserve cash.

First you raise your prices 5%, and now you are adding a spoonful of olive oil in your coffees? Okay Starbucks, keep it coming.

Starting this year, American Express lounges will no longer allow most travelers with its premium credit cards to bring two free guests, but spend $75,000 or more a year, and your guests will still be free. What a deal!

McDonald’s plans to launch plant-based McNuggets in Germany this week. We’ll see how this goes: “Plant McNuggets” just doesn’t resonate quite the same way that “Chicken McNuggets” does.

NASA’s announced a $3.5 billion plan to redesign its aging spacesuits. May we suggest they make it shoot lasers from the wrist like Buzz Lightyear?

Toyota and Honda both agreed to their biggest wage hikes in decades. Toyota’s workers’ union didn’t disclose a percentage increase, but Honda will raise pay by 5%.

Tesla is scaling back German battery plans, as the Inflation Reduction Act tax incentives are bringing battery assembly back to the U.S.

And Tom Brady is still retired.