…and eBay auctions its luxury belt (while others tighten it)
| Cannabis is cash biz (Kamil Krzaczynski/Getty Images) | |
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Yesterday's Market Moves | | Dow Jones
35,283 (-0.67%) | S&P 500
4,537 (-0.64%) | Nasdaq
14,050 (-0.55%) | Bitcoin
$29,183 (-0.58%) |
| Dow Jones
35,283 (-0.67%) | S&P 500
4,537 (-0.64%) | Nasdaq
14,050 (-0.55%) | Bitcoin
$29,183 (-0.58%) |
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Hey Snackers, Subway is offering free footlongs for life in its latest promo. There's one catch: the winner must assume a "new iconic identity" by legally changing their first name to "Subway." The Dow ended its 13-day streak yesterday, even as GDP data fueled hopes of a soft landing. The US economy grew at an expectation-beating 2.4% annualized pace last quarter (congrats), and the Congressional Budget Office now projects the US will avoid a recession. | |
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Mastercard cracks down on pot purchases, leaving the industry with few payment options | For everything else, there's Mastercard… everything but weed. Mastercard sent cease-and-desist letters to businesses that were accepting its debit cards as payment for cannabis products (credit cards were already mostly a no-go). Since cannabis is still illegal at the federal level, Mastercard said those swipes are not allowed (even in the 38 states where it is legal). Canna sellers had turned to PIN debit payments after Visa warned against using the cashless ATMs that had been used by many dispensaries. Stuck in legal limbo… Because marijuana is considered a Schedule I drug, lots of cannabis companies are underbanked (big banks don't want to be associated), and it's hard for them to raise capital and get loans. Proposals to open up financial services to canna companies have flopped so far. The legislation with the most oomph, the SAFE Banking Act, passed the House four years ago but is stuck in the Senate, where it faces bipartisan opposition. Rolling out: The US cannabis market has been struggling to sell off a supply glut as theft and illegal dealers cut into its pot pie. Curaleaf, the biggest distributor in the States, pulled out of CA, CO, and OR this year, citing a lack of enforcement against the illegal market.
|  | THE TAKEAWAY |
| Dark forces thrive in gray areas… Cash reliance has made dispensaries hot targets for burglaries (dispensary burglaries doubled in the Golden State last year), and illegal markets have undermined legit ones by charging less. The US's legal dilemma has made cannabis titans like Canadian Tilray (which reported strong earnings this week) hold off on plans to distribute THC products in the US. Still, nearly 9 in 10 Americans agree with Sean Paul to "Legalize It." | |
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eBay invests in luxury to stand out from rivals like Amazon as usage trends down | Buy now, bid later… eBay shares fell 8% yesterday after the OG marketplace dropped a mixed earnings bag. Last quarter, its sales jumped 5% to $2.5B, but its profit forecast was a bummer. eBay has upped spending on new shopping categories like auto parts and refurbished goods. App downloads and users have trended down as e-comm competition heats up. Now eBay hopes that designer digs can give it a badly needed bump. $400 vintage Prada… eBay's long been a secondhand-shopping go-to for bidding on collector baseball cards and "gently used" couches. But the 2000s icon has lost market share to bigger rivals like Amazon and Walmart. So eBay's doubling down on the luxury market to boost earnings and differentiate itself from budget-friendly rivals. Supremium: eBay recently expanded its designer-certified program to include streetwear biggies like Kith, Supreme, and Off-White. AI-verified: This month eBay acquired AI biz Certilogo, which creates virtual tags to track brand-name goods. Last year, eBay sellers listed 100K+ handbags and 1M jewelry items every day.
| | THE TAKEAWAY |
| Richer isn't always smarter… eBay's entry into luxury could be too little too late: last week Louis Vuitton parent LVMH and Cartier owner Richemont reported a surprise dip in US sales as folks cut back on material splurges. Meanwhile, prices for secondhand watches from sought-after brands like Rolex have fallen 30%+ from last year. | |
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| 🌶️ Spicy… SBF accepted a gag order after prosecutors said they wanted the former FTX CEO jailed before his October trial. Officials said he leaked private journals of his ex-CEO/ex-lover to discredit her expected testimony against him. 🤹♀️ Quirky… 50+ new alien or UFO-themed cryptos (like: alienx, UFO) were spotted after Wednesday's House hearing on the gov't response to unidentified flying objects. Crypto trends often follow hype. Recall: the boom in AI-themed tokens. 💰 Spendy… Meta said its Reality Labs unit (VR, metaverse) lost $3.7B last quarter, adding to the $13.7B it lost last year. CEO Zuck said the biz is still committed to investing in its meta-ambitions, despite its recent focus on AI. | |
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What else we're Snackin' | Loss: Eli Lilly said its newest experimental drug helped patients lose 26% of their weight. As 40% of US adults have obesity, analysts say the market for weight-loss drugs could be worth $200B within the next decade. McSmile: McDonald's said its Grimace milkshake helped sales jump 10% last quarter (that and price bumps). The burger beast has leaned into viral marketing, with celeb-tied meals serving up main attractions. Chop: The FTC is said to be readying an antitrust suit against Amazon that could break up the biz (FYI: Amazon reports next week). The regulator's upped its efforts to enforce antitrust rules under Chair Lina Khan. [209] EVolt: Seven automakers including GM and Honda said they'll build 30K EV chargers in the US and Canada. That would nearly double the # of US chargers, reducing range anxiety (and reliance on Tesla plugs). Exposed: A mobile app reportedly spied on 60K Android phones. Researchers say the use of stalkerware — software that abusers use to track and harass victims — has spiked in recent years.
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Snack Fact Of the Day | If the Dow had risen yesterday, it would've been the index's longest win streak since 1897 | | |
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Friday | Earnings expected from Exxon, Chevron, Colgate, Procter & Gamble, AstraZeneca, and Sanofi
Authors of this Snacks own shares of: Amazon, GM, Exxon, Tesla, and Walmart | |
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Sherwood Media, LLC produces fresh and unique perspectives on topical financial news and is a fully owned subsidiary of Robinhood Markets, Inc., and any views expressed here do not necessarily reflect the views of any other Robinhood affiliate... See more | |
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