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Mark Zuckerberg never did get the chance to fight Elon Musk in a cage, but he's teaming up with Jeff Bezos to tag-team the formidable digital advertising market. This week, Meta debuted a feature that lets users link their Facebook and Instagram accounts to their Amazon accounts, making online shopping more seamless. For example, if an Amazon ad for a trendy pair of shoes or a cool set of headphones appears on a user's social media feed, they can click a button and purchase the items without being redirected to the Amazon app. Now you can doom-scroll and disappear your disposable income at the same time. We love technology. | | | • | | Japan has mixed feelings about inflation. | | | | • | | Big Tech has a mixed day in Europe. | | | | • | | AMC needs help after summer blockbuster season. | | | Please do not delete this text. | | Please do not delete this text. | | Japan's Central Bank Has an Unusual Foe: Inflation | | | (Photo by Jezael Melgoza on Unsplash) | | | Meet the one place on earth where inflation is actually welcome, to a point. | | | After decades of trying — and failing — to stoke inflation, Japan has finally been gifted steadily rising prices, thanks to the same macroeconomic forces afflicting the rest of the world. In an interview with the Financial Times on Thursday, central bank governor Kazuo Ueda outlined the bank's plan to cautiously boost rates without killing the country's shiny new growing economy. | | | Since the 1990s, Japan has been mired in a status quo of consistently falling prices — yes, deflation. And while that may sound enviable to just about every other country right now, Japan's deflation has long been coupled with stagnant wages and little to no economic growth, all of which combine to create what economists have dubbed a "Japanification" doom loop. The Bank of Japan has employed just about every trick in the central banking book to boost growth, maintaining ultra-ultra loose fiscal policy, going so far as instituting negative interest rates of -0.1% and keeping an iron grip on bond markets. | | | It took a pandemic and the outbreak of war in Ukraine to finally do what the BoJ couldn't. But now there may be too much of a good (or bad?) thing. In January, Japan's inflation rate hit a peak of 4.2% — still far below the roughly 10% rates seen in the US and the EU, but historically high for Japan — spurring both wage and economic growth. By September, that fell to 2.8%, and now Ueda has tasked himself with shrinking that number closer to an ultimate 2% goal — without relapsing into Japanification: | | | • | | The BoJ announced in July plans to ease control of the government bond market, offering to buy 10-year bonds at 1% fixed-rate operations. At the end of October, the BoJ said it would go even further, allowing yields on the 10-year bond to surpass 1%. | | | • | | In effect, the central bank was hoping to unwind its yield curve control policy to buoy a slumping yen, in hopes of maintaining the positive momentum brought by inflation. On average, Japanese companies delivered a 3.5% raise to employees this year, according to The Wall Street Journal, the highest wage gain in 30 years, while the economy grew nearly 5% year-over-year between April and June. | | | Grey Zone: That growth may be difficult to maintain. Over 10% of the nation's population is at least 80 years old or older, and almost 33% is over 65. By 2040, Japan's economy could be short 11 million workers, according to a recent study by the think tank Recruit Works Institute, and Prime Minister Fumio Kishida said in January that "Japan is standing on the verge of whether we can continue to function as a society." So, sure, relatively low inflation may sound great to permanently sticker-shocked Americans now, but the bigger picture is far more complicated. | | Please do not delete this text. | | Please do not delete this text. | | Tech Giants Win Regulatory Case in EU, But Tax Clouds Loom | | | Big Tech has won a major battle with European regulators, but the war is far from over. | | | On Thursday, Meta, Google, and TikTok successfully argued that individual European countries can't cook up their own laws for large digital platforms. Simultaneously, however, Big Tech peer Apple suffered a setback in a case that, if it loses, could leave it on the hook for $14 billion in back taxes. | | | The court fight for Meta, Google, and TikTok hinged on an Austrian law from 2021 which required tech platforms to delete hate speech or else face hefty fines of $10 million. The platforms argued that since their European businesses were headquartered in Ireland, Austria couldn't enforce a domestic law against them — and the EU's highest court agreed. It's a tempered win for the platforms, staving off the possibility of individual countries passing laws that become thorns in their sides, but also leaving them on the hook for possible content moderation fines in the wake of the EU enacting overarching legislation in 2021 for Big Tech platforms with the Digital Services Act. | | | But Apple's court setback is potentially more worrying to Big Tech, as the FAANG giants have historically enjoyed low tax rates thanks to Ireland's extremely welcoming stance on foreign multinationals setting up shop there: | | | • | | Commissioner Margrethe Vestager brought the case against Apple in 2016, arguing that the company received unfairly advantageous tax status in Ireland, amounting to state aid. In 2020, an EU court said Vestager's argument was legally flawed, a major win for Apple at the time. | | | • | | Now, however, an advocate-general in a higher European court has said that ruling was legally flawed, and that Vestager's case against Apple should be allowed to proceed. | | | The Irish Fear an Exit: Tech giants aren't the only ones on edge: Ireland's finance minister told the Financial Times: "It has always been, and remains, Ireland's position that the correct amount of Irish tax was paid and that Ireland provided no state aid to Apple." For a country that just started its own sovereign wealth fund, any ruling that might make it less attractive to big, cash-rich tech firms is bad news. | | Please do not delete this text. | | Please do not delete this text. | | Your Colleagues Should Really Know How, By Now… | | | So it's on you to explain that one task, over and over, for the umpteenth time. That one tricky end of month process. That one trick on Quickbooks. | | | It's time to free yourself from repetitive conversations and explainers with the help of AI-powered documentation. guidde is a GPT-powered tool that helps you explain the most complex tasks in seconds with AI generated documentation: | | | • | | Turn boring documentation into stunning visual guides | | | • | | Save valuable time by creating video documentation 11x faster | | | • | | Share or embed your guide anywhere for your team to see | | | Simply click capture on our browser extension and the app will automatically generate step-by-step video guides complete with visuals, voiceover and call to actions. | | | The deal closer? guidde is 100% free. | | Please do not delete this text. | | Please do not delete this text. | | AMC Swung to a Profit, Still Needs More Cash | | | If only there was a "Barbenheimer" every quarter. | | | AMC, the world's largest movie theater chain, said Thursday that it filed to offer up to $350 million of stock. The announcement followed a third-quarter earnings report on Wednesday that looked good, but apparently wasn't good enough. | | | Let's All Go To The Lobby | | | AMC's most recent quarter was a pleasant and much-needed surprise for the company with roughly 1,000 locations around the world. Revenue jumped 45% to $1.4 billion — beating Wall Street's predictions by about 12% — and theater attendance grew nearly 40% year-over-year, largely off the year's two mega-hits, "Barbie" and "Oppenheimer." | | | But now AMC plans to sell $350 million in stock, which sent its share price down more than 13%, to help repay debts and raise liquidity: | | | • | | Even before the pandemic practically shuttered the movie theater industry, AMC had nearly $5 billion in debt, after replacing its theaters' traditional seating with cozy recliners and buying up competitors like Carmike and Odeon. | | | • | | But the pandemic also coincided with AMC's emergence as a "meme-stock," gaining a cult following on social media that — divorced from all financial reality — pushed the stock above $500 in 2021. (It's now under $9.) The company took advantage of its status by selling its suddenly valuable shares; it last sold 40 million shares in September, raising about $325 million. | | | Strike Out: Though the Hollywood strikes appear to be over, many projects are well behind schedule — not the best news for any theater chain. "There has been and will be much collateral damage from these lengthy work stoppages," AMC CEO Adam Aron said shortly before the actors strike ended. At least AMC has Beyoncé's Renaissance Tour film to look forward to this December, hopefully recreating the box office success of Taylor Swift's Eras Tour movie. And who knows, maybe AMC's meme-stock status will return in 2024 for another chance to sell off stock. | | Please do not delete this text. | | Please do not delete this text. | | • | | Forget the toys: Pre-teens could be one of the biggest markets for skincare products this holiday season. | | | • | | Risky startup bet: SoftBank books a $5.2 billion quarterly loss amid WeWork's demise. | | Please do not delete this text. | | | Disclaimer | Reg A+ offering made available through StartEngine Crowdfunding, Inc. No broker-dealer or intermediary involved in offering. This investment is speculative, illiquid, and involves a high degree of risk, including the possible loss of your entire investment. Please see the most recent supplement, offering circular, and selected risks.
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