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Market Update

📊 Things were cool in the market until JPow took the stand in front of lawmakers.

The Federal Reserve Chairman said they are prepared to raise rates higher than previously anticipated to assist in slowing down the economy. Stocks dropped immediately on the news, sending the DOW down 2%.

🟢  Airlines had a good day: Delta and United rose 1.6% and 3%, respectively, after the Justice Department sued to block JetBlue’s acquisition of Spirit.

🔴  EV maker Rivian fell 14.5% after announcing a $1.3 billion junk bond offering.

Banger Tweet of the Day

I’m in the 10%.

Meta Does the Layoff Thing, Again

Meta is planning another round of layoffs expected to impact thousands of workers across the organization.

Round Two: The company laid off roughly 13% of its workforce in November as part of its larger cost-cutting plan.

Year of Efficiency: Zuck recently dubbed 2023 as the “Year of Efficiency”, and that he plans to cut under-performing projects as well as remove large layers of middle management.

Bottom Line: The company is facing real business headwinds, reporting declining revenue & ballooning costs for the last two quarters. Meanwhile, the company is losing $15 billion a year on VR, and investing double that into AI.

As business gets tougher, they don’t really have a choice but to do more with less.

Business Bytes

💼 The FTC demanded Twitter turn over Elon’s Internal Communications (WSJ)

• Basically, The FTC is concerned that Elon’s massive layoffs will compromise the company’s ability to protect users.

• The FTC has sent 12 letters to Twitter since Oct 27th, and also asked the company to name all journalists given access to company records.

🏘️ Airbnb Competitor Roami raises $14M in Equity & Debt

• The company focuses on short-term rentals and operates ~500 units across the Southeast.

• Instead of copying Airbnb’s marketplace model, Roami owns the buildings it rents, allowing it to focus on delivering a seamless & consistent user experience.

• Sounds to me like they’re a short-term rental landlord? Nothing new to see here.

✈️ JetBlue, Spirit Brace for Justice Department Lawsuit to Block Airlines’ Merger (WSJ) 

• JetBlue and Spirit agreed to merge last year in a $3.8 billion deal that would make them the 5th largest US airline.

• The government seems intent on stopping the merger on the basis that the merger will undermine competition.

📷️ TikTok to allow creators to sell collections of long-format videos (Reuters)

• The Chinese app said its testing allowing creators to produce longer videos and charge users for access.

• Is the next top Indie film gonna drop on TikTok?

TikTok Faces More Heat in the US

Trouble is brewing for TikTok as a group of bipartisan senators introduced a bill addressing the security risks brought on from technology from rival countries.

TikTok, of course, is a large focus.

RESTRICT Act: The RESTRICT Act (long & boring acronym) would create new government process around reviewing foreign technology risk, requiring the Commerce department to establish procedure around how the US should handle such tech.

US Officials are concerned about TikTok relaying sensitive data on Americans back to China, while TikTok has claimed it does not and would not share such data.

Anotha’ one: A separate bill aimed at a widespread ban in the US was approved by the House committee last week, and now faces the GOP-led House then Democrat-led Senate for further approval.

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Thanks for reading, go out and make today a great one.

Much Love,

Andrew (and AI)