⚖️💰Unravelling the FTX Trial

Welcome to the Thursday Newsletter, where we cover top industry news stories to keep you in the know.

Rise and Shine, Man. Today is national Get Funky Day. So kick back, relax, and vibe with us as we take a righteous trip through the past week’s industry stories. We've got some far-out stuff to share, so just chill and let the good times roll, man.

Today is a reminder to smile, laugh, dance, and let the good vibes be contagious. Watch your interactions with customers, co-workers, and loved ones improve today. 🌼✌️

_{-Bailey Hepler}

TRAVEL ECONOMICS

Weight-loss drug Ozempic may save airlines millions

Weight-loss drugs like Wegovy and Ozempic have become so popular that there have been shortages. Not only are the drugs helping you lose a few pounds, but airlines are savings millions as their aircrafts cut weight too.

As airlines focus on optimizing fuel efficiency, they look for ways reduce plane weight. As with every vehicle, the heavier an airplane is, the harder the engines have to work, burning fuel more quickly the heavier it is. Airlines have placed many weight cutting initiatives reports BI:

• Lighter food and drink carts

• Lighter entertainment systems

• More lightweight seats

• Lighter paper for pamphlets and magazines

In a study on the “implications of a slimmer society,” one analyst estimated United would save $80 million a year if every passenger lost 10 pounds. Sheila Kahyaoglu, a Jefferies Financial analyst, estimated that:

• 10 lbs weight loss per flyer = 1,790 lbs per flight = 27.6 million gallons of fuel saved per year = $80 million savings at today’s current fuel price.

Celebrities have publicly endorsed the use of Wegovy and/or Ozempic. Elon Musk admits to taking Wegovy with intermittent fastening, while Boris Johnson, Amy Schumer, Charles Barkley, and Sharon Osbourne, have all said they have taken semaglutide (brand names Ozempic, Wegovy and Rybelsus). Celebrity endorsements typically contribute to sales, in turn, the mass stock outs for the weight-loss drugs.

CRYPTO

Blockbuster Sam Bankman-Fried Trial

Other than a new haircut, not much has changed in disgraced crypto tycoon Sam Bankman-Fried’s trial that will soon take the media by storm. SBF still faces multiple money laundering and fraud charges after his cryptocurrency exchange FTX collapsed in November last year. However, more of the story will unfold as the trial only began Tuesday. Here’s a play-by-play recap on the past two days presented by Wired:

Tuesday

Bankman-Fried was present sporting his new dew (cut & combed) as jury selection took place. The court chose 12 jurors and six alternates so opening arguments could begin Wednesday.

Wednesday

The prosecution began with telling the story of SBF. That he knowingly diverted customer money to his own pockets through Alameda to buy property and influence.

The defense argued that SBF acted in good faith and that it’s not a crime “to be the CEO of a company that needs to fold for bankruptcy.” They’re framing the story to explain how volatile the crypto market is and can cause well-intentioned businesses to lose money.

🏃🏻‍♂️Catch-Up. 

• Cryptocurrency exchange FTX and its partner hedge fund Alameda Research collapsed November 2022.

• SEC quickly investigated SBF and extradited him from the Bahamas in January 2023.

• Federal prosecutors are charging SBF on seven counts of wire fraud, securities fraud and money laundering or conspiracy. Prosecutors also allege SBF stole $100 million from his $32bn empire to influence the US political establishment, Hollywood and even Chinese officials.

• SBF was allowed to live with his parents on $250 million bail when he was accused of witness tampering in August 2023. He’s been held in a Brooklyn jail since then.

• If guilty, SBF faces over 100 years in prison.

POLITICS

Historic Ousting of House Speaker, Kevin McCarthy

After 8 rebellious republicans joined minority chamber of Congress democrats in voting, House Speaker Kevin McCarthy was ousted with the vote of 216-210. Florida Congressman, Matt Gaetz, lead the movement after McCarty relied on Democratic votes to get a short-term spending deal passed on Saturday to avert a government shutdown.

Gaetz accused McCarthy of “making a secret deal” with President Biden regarding Ukraine aid. It’s deeper than that, though. The motion to remove McCarthy came after a year long saga between him and the Republican party.

• Republicans attempted to block his election to the post in January, saying he could not be trusted to enact conservative principles.

• In their view he proved that by striking a deal with Democrats in June to raise the debt ceiling without extracting the deep cuts they wanted.

• Now they are the ones being accused of treachery - some Republicans are openly talking about expelling Mr Gaetz.

Next Steps. During a week long recession until October 11th, the House will discuss candidates for a new speaker, but it could take days or weeks to find a candidate that would get a majority vote.

RETAIL

Your Fall Shopping Spree may look different this year

Enjoyable Fall weather typically brings consumers out of the house for a fall shopping spree, but this year’s trip to your favorite retailer could be a headache. Let’s break down how store closures, lack of inventory, reduced workforce, and organized theft are contributing to a lack of in-person shopping.

The Importance of in-person Retail Shopping. The magic recipe for what bonds us to a brand — excellent product + excellent buying experience = returning customers. Many brands are shifting to online shopping to combat organized retail theft, but there’s a cost. In-person shopping leads consumers to:

• Buy extra stuff

• Unlikely to return purchases

• Drive online traffic

🗝Key Drivers.

• Retail giants are closing hundreds of stores across the US as organized shoplifting has caused companies to lose billions of dollars.

• Target (9 store closures), Walmart (22 store closures), Nordstrom (15 store closures), Macy's (3 store closures), CVS (900 store closures!!!) plus more are locking down goods in their brick & mortar. Good luck finding that one associate who’s on their smoke break to get your Claritin from behind the glass.

• The lack of retail workers is contributing to long check-out lines, and long lines for self checkout which I always try not to look at myself in the security camera screen.

Axios reports this trend is hitting every level of retail except for ultra-luxury as Prada and Louis Vuitton sales are strong.

🐝Buzz words.

• Retail Apocalypse: The death spiral of IRL shopping as retail stores continue closures.

• Doom Loop: The fear of a commercial real estate apocalypse could spiral out and slow commerce, wrecking local tax revenue in the process.

By the numbers. Insider reports 3,200 stores will close in 2023. National Retail federation reports store theft lead to over $112 billion in retail losses for 2022.

KAEL’S TALES

NCAA Misclassifications, MLB is so back, more Taylor Swift

📝Amateurs Misclassified. After two years of name, image, and likeness (NIL) a formal complaint has been filed with the National Labor Relations Board (NLRB) with the intent of ending the NCAA’s amateurism. A college athlete advocacy group called the College Basketball Players Association filed a charge against the Ivy League. The charge against the conference is over the misclassification of student-athletes as amateurs rather than professionals and is the first charge that has been filed against a conference. While this is separate from the efforts to unionize students by Ivy League member Dartmouth, this case has a similar goal of granting athletes employment status under U.S. labor law.

It is important to keep in mind that the Ivy League is the only athletic conference that prohibits athletic scholarships – which is a current policy that is subject to antitrust lawsuits, so the tried-and-true counterargument of student-athletes getting paid in athletic scholarships doesn’t apply. The goal of targeted conferences and the NCAA, advocates of the charge hope to invoke the joint employer” doctrine and invite multiple entities to employ college athletes – including private entitles like conferences that are under the NLRB’s purview.

⚾MLB is so back. The turn of the calendar from September to October means one thing for the fans of America’s pastime – playoff baseball. After the first regular season of new on-field rules that aimed to shorten game length and create a more action-filed to lure younger fans, these changes helped generate a 9.6% increase in total attendance, making this season the highest attendance since 2017 and the first year of total attendance over 70 million. Another contributor to the surge in attendance can be pointed to an influx of newly competitive teams that are returning to the postseason after a multiyear absence. The new rule changes and the efficiency of a pitch clock, larger bases, and ban on extreme shifts can be attributed to the massive 24-minute reduction in average time to two hours and 40 minutes, which is the MLB’s lowest number since 1985.

🏈🎤Swift Stats. The burgeoning and seemingly out-of-nowhere relationship between pop music sensation Taylor Swift and Superbowl champion Travis Kelce has turned the NFL into the biggest topic in pop culture. In Sunday Night Footballs broadcast between the New York Jets and Kansas City Chiefs, the NBC camera crew cut away from the live action and to the private box where Taylor Swift was watching.

The Chiefs-Jets game drew 27 million viewers, making it the most-watched broadcast since the Superbowl earlier this year. NBC drew about 2 million more female viewers than its season average so far. There has been chatter and criticism over the frequency of mentioning the pop star that the official spokesperson for the NFL had to defend the promotion of the relationship. “The Taylor Swift and Travis Kelce news has been a pop cultural moment we’ve leaned into in real-time, as it’s an intersection of sport and entertainment, and we’ve seen an incredible amount of positivity around the sport,” the league said in a statement. With the Kansas City Chiefs being one of the most popular teams in the league and no apparent slowdown in the relationship between the two stars, expect to see more of Taylor Swift on your TV.

_{-Written by Mikael Hall}

THURSDAY SHORTS

• 📷Photo of the Week: This is NOT a concert in the desert. It’s a U2 concert that was held inside of the infamous Madison Square Garden Sphere. Not only is the Las Vegas housed MSG Sphere the greatest billboard of all time, it also doubles as a concert venue.

• 🔮The mind-boggling MSG Sphere advertisement rates went public this week. $450k for the day, $650k for the week. These rates include working with the design team to create the ad campaign.

• 👨‍🎓Biden cancels $9 billion in student debt for 125,000 borrowers. Click here to see if you qualify.

• 🏈Sam Bankman-Fried paid Tom Brady $55 million for 20 hours of working on FTX ads.

• 💸CNBC reports 4 out of 10 workers don’t contribute any money to their 401k or employer-sponsored plan.

• ⚾MLB umpires are better than they’ve ever been after 21,000 balls were incorrectly called strikes in the 2023 MLB season.

  TRIVA QUESTION: Which CEO is it?

  -Answer: Bob Iger (Disney)