☕ Armchair detectives

Why the economy’s soft landing is in doubt... [Advertisement] April 26, 2024 [View Online]( | [Sign Up]( | [Shop]( [Morning Brew]( PRESENTED BY [Delta American Express]( Good morning. TGIF (the correct pronunciation is T-JIFF). —Cassandra Cassidy, Matty Merritt, Molly Liebergall, Adam Epstein, Neal Freyman MARKETS Nasdaq 15,611.76 -0.64% S&P 5,048.42 -0.46% Dow 38,085.80 -0.98% 10-Year 4.706% +5.4 bps Bitcoin $64,748.00 +0.73% Meta $441.38 -10.56% *Stock data as of market close, cryptocurrency data as of 11:00pm ET. [Here's what these numbers mean.]( - Markets: Investors played Simon & Garfunkel’s “The Sound of Silence” as they stared blankly into a mirror yesterday, prepared to meet darkness, their old friend. [Stocks sank]( after the latest GDP report showed slower-than-expected growth, renewing fears that the Fed may not cut rates this year after all. Meta fell nearly 11% because investors are suspicious of the company’s ballooning AI costs.  ECONOMY [That soft landing is suddenly looking rocky]( [Soft landing graphic of money attached to a parachute falling to the ground ]( Scialabba Cheers for the Fed’s successful pillow-soft landing might’ve been premature. New GDP numbers out yesterday show a worrying combo of stubborn inflation + waning growth that dampens hopes for a potential interest rate cut. Per the latest data from the Bureau of Economic Analysis, the first quarter of 2024 was a confounding one: - GDP increased at a 1.6% annualized rate, far below projections of 2.4% and notably down from 3.4% at the end of 2023. - While [slow growth]( would typically signal that the Fed could cut rates, another metric complicates matters: Consumer prices (excluding volatile categories), a solid indicator of inflation, shot up to a much higher than anticipated 3.7%. So, things are bad? Not quite. Compared to the rest of the world, the US economy is still ripping. The US will account for 26.3% of global GDP this year, based on projections from the International Monetary Fund, and outperforms its competitors on additional measures. Plus, applications for unemployment benefits fell to their lowest level in two months, and consumers continue to [spend]( despite increasing debt. Proceed with caution. JPMorgan CEO Jamie Dimon [summed up]( the situation by warning against a “false sense of security.” Dimon, who puts the odds of a successful soft landing at less than 50%, specifically cited geopolitical challenges and the $2 trillion fiscal deficit (2% of GDP) as reasons he’s cautious about the health of the economy over the next few years. Looking ahead…the Fed is stuck in “monetary policy purgatory,” said KPMG’s chief economist, as it deliberates if and when it will cut rates. All options are on the table, including a dreaded rate hike.—CC PRESENTED BY DELTA AMERICAN EXPRESS [This card has wings]( [Delta American Express]( Incoming: the new limited edition business Card design has arrived. We’re talking about the Boeing 747 Delta SkyMiles® Reserve American Express Business Card design. Each card is crafted with [metal from an iconic Delta Boeing 747]( known by aficionados as the “Queen of the Skies.” This next-level card comes with a welcome offer. Earn [75,000 bonus miles when you spend $10,000 in purchases on the Card within the first 6 months]( of Card Membership. Not to mention you can earn 1.5x miles** on eligible transit, U.S. shipping, and U.S. office supply store purchases—plus 3x miles on Delta purchases to help you get the most for your business. [Level up your card game](. *The limited edition Boeing 747 design is made with 33% metal from a Delta Boeing 747 aircraft. Image for illustration only. Does not represent Boeing 747-400 aircraft used for card. **If your purchase qualifies for a category that has a higher mileage accelerator, only the higher accelerator will apply. WORLD [Tour de headlines](#) [Harvey Weinstein in court]Pool/Getty Images Harvey Weinstein’s New York rape conviction was overturned. [In a 4–3 decision]( the New York Court of Appeals ruled that the disgraced Hollywood producer did not receive a fair trial when he was convicted of felony sex crimes in 2020. The court determined that the judge improperly allowed several accusers who were not part of the charges in the case to testify against him. Weinstein will remain in jail but could be transferred to California, where he was sentenced to 16 years in a separate rape conviction. More than 100 women have accused Weinstein of sexual abuse dating back to the 1970s. SCOTUS is skeptical of Trump’s immunity claim, but might still delay his DC trial. That was pundits’ takeaway from [oral arguments]( at the Supreme Court yesterday, where lawyers for Trump argued that the former president should be completely immune from prosecution in his federal election interference case. Justices did not seem convinced that presidents are above the law, though some on the court’s conservative wing signaled that the case needs to iron out some kinks in the lower courts before it can go to trial. That would be a win for Trump, as it almost certainly would mean the trial would be delayed until after November’s presidential election. The court is expected to issue its ruling by July. Big Tech earnings roundup. Alphabet, Microsoft, and Snap reported Q1 earnings yesterday, and the vibes were generally good. Alphabet issued its [first-ever dividend]( and authorized $70 billion in stock buybacks, after it beat Wall Street’s revenue expectations. Microsoft also beat revenue forecasts on the [strength of its cloud services](. And Snap shares soared after it topped estimates and [impressed investors]( with its 422 million global daily active users. It was a much-needed boost for the sector after Meta spooked the market with how much it’s spending on AI gizmos. FOOD & BEV [Customers keep coming back to Chipotle]( [Chipotle workers at location.]( Sullivan/Getty Images Even with myriad hacks to trick employees into boosting the barbacoa in your burrito, Chipotle still crushed Q1. The fast-casual restaurant chain [reported]( higher-than-expected revenue and a 5.4% increase in location traffic compared to the same time last year, despite charging diners more. Don’t believe everything you see on TikTok. While the vocal frustration over perceived [quality decline]( amid the price hikes has ratcheted up, customers keep coming back. - Defying [industry trends]( Chipotle has raised prices six times in the last three years and has still managed to see traffic and sales go up. Meanwhile, companies like McDonald’s have seen their customer base skip the drive-thru because of price hikes. - Chipotle made $2.7 billion in revenue last quarter, even more than the $2.68 billion Wall Street expected. Chipotle’s chicken al pastor is so popular, in fact, that supply is running dry. A top exec sent a message to store managers asking them and their staff to choose a different protein option for their meals so there’s enough chicken for customers, but [rescinded]( the request yesterday. Big picture: The chain’s continued success lies in its loyal fans: higher-income, health-conscious young professionals who still think a quick $14 al pastor bowl is worth it.—MM TOGETHER WITH BETTERMENT [Betterment]( Grow your dough. Put your money to work in a [high-yield cash account]( with up to $2M in FDIC insurance at [program banks]( , courtesy of Betterment. PS: New customers get 5.50% variable APY* with a qualifying deposit (terms apply) for three months, and Betterment’s base rate afterwards, which is currently 5.00%. [Max your $aving$](. ENTERTAINMENT [Netflix’s Baby Reindeer hysteria, explained]( [Richard Gadd in ‘Baby Reindeer’]( Currently the No. 1 English-language Netflix show in the world, Baby Reindeer is a new limited series based on the true story of how Scottish actor Richard Gadd survived abuse and shed his stalker. But it’s not like other true-crime dramas—Gadd wrote, produced, and starred in the show himself, and now he’s asking fans to [stop obsessing over it](. Why? Despite getting the story straight from the reindeer’s mouth, some internet sleuths are trying hard to find Gadd’s real-life abusers (renamed Martha and Darrien in the show) that you’d think they didn’t just watch a series about the horrors of stalking. - The global number of Google searches for “martha baby reindeer” and “real martha” spiked this week, while some X users are circulating decade-old tweets from an account they claim belongs to the real stalker. - Gadd’s friend Sean Foley, a fellow filmmaker, [said]( this week that police are investigating “all defamatory abusive and threatening posts” made about him after social media users speculated that he’s the real-life abuser portrayed as Darrien, seemingly because he and the character both…have beards? Zoom out: As true-crime shows skyrocket in popularity, “[armchair detectives]( have come out of the woodwork to sling half-baked theories that can snowball into dangerous doxxing.—ML GRAB BAG [Key performance indicators](#) [The Acropolis in Athens covered in a dust cloud]Milos Bicanski/Getty Images Stat: Mother Nature apparently has a thing for the cinematography in Blade Runner 2049. Athens experienced its worst dust storm [since 2018]( this week as hot air blew north from the Sahara Desert, blanketing the ancient Greek city in an orange mist that at one point was so thick it concealed the Acropolis. And it was about as hot as it looked: Several countries in the Mediterranean are hitting record temps. Nearby Cyprus, for instance, reached nearly 103 degrees Fahrenheit on Wednesday—the hottest April day in its history. The Sahara releases 60 million to 200 million metric tons of dust [per year]( the BBC reported, so this probably won’t be the last time Athens looks like a creamsicle. Quote: “Europe could die.” Speaking like someone who just saw the above photo of Athens, French President Emmanuel Macron argued in a speech yesterday that the European Union [faces an existential risk]( if it doesn’t strengthen its economies, build up its militaries, and rely less on the United States. Macron has long been a proponent of “strategic autonomy,” arguing yesterday that the EU must not become a “vassal” of the US. While the speech was warmly received by other leaders, Reuters pointed out that it came as Macron tries to show his critics that he’s not a lame duck. Read: Why universities refuse to divest from companies doing business with Israel. ([WSJ]( QUIZ [Mondo Duplantquiz]( [New Friday quiz image]( Getting a 5/5 on the Brew’s Weekly News Quiz has been compared to seeing the server coming with your food. It’s that satisfying. [Ace the quiz](. NEWS [What else is brewing](#) - [USC]( canceled its May commencement ceremony over worries that pro-Palestinian protesters would disrupt it. - [Southwest Airlines]( is pulling out of four US airports, including Houston’s George Bush Intercontinental Airport, amid Boeing’s delivery issues. - [The FCC]( voted to restore net neutrality, classifying the internet as a public utility, which will make it harder for providers to play favorites with certain websites. - [Haiti Prime Minister Ariel Henry]( resigned as the country is overrun with gang violence. - [The Chicago Bears]( selected USC quarterback Caleb Williams with the first overall pick in this year’s NFL Draft. RECS [Friday to-do list] Devour: The snack gods smile upon thee with these new [Sour Patch Kids-flavored Oreos](. Watch: Europe’s seagull [screeching championship]( is exactly what it sounds like. Debate: Are women’s bodies actually [controlled by the moon?]( Keep it secret. Keep it safe: The Lord of the Rings film trilogy will be [back in theaters]( this summer—in remastered 4K Ultra HD. Need content now?: Say no more. Contentful’s [AI Content Type Generator]( delivers on-brand experiences at an astonishing rate. Get intelligent, composable content that’s endlessly configurable. [Try it]( *A message from our sponsor. GAMES [The puzzle section](#) Picdoku: For once, the A train is showing up on time. [Play today’s subway-themed Picdoku here](. Friday puzzle You have a 24-hour digital clock that displays hours, minutes, and seconds (for example, 09:30:23). How many times during a 24-hour period do all six digits change simultaneously? SHARE THE BREW [Share Morning Brew]( with your friends, acquire free Brew swag, and then acquire more friends as a result of your fresh Brew swag. We’re saying we’ll give you free stuff and more friends if you share a link. One link. Your referral count: 0 [Click to Share]( Or copy & paste your referral link to others: [morningbrew.com/daily/r/?kid=4904f90a]( ANSWER Three times. When 23:59:59 becomes 00:00:00 When 09:59:59 becomes 10:00:00 When 19:59:59 becomes 20:00:00 Word of the Day Today’s Word of the Day is: myriad, meaning “a lot of something.” Thanks to Jeff from Wisconsin and myriad others for the suggestion. Submit another [Word of the Day here](. Written by [Adam Epstein]( [Cassandra Cassidy]( [Matty Merritt]( [Molly Liebergall]( and [Neal Freyman]( Was this email forwarded to you? Sign up [here](. Interested in podcasts? - Check out ours [here]( [ADVERTISE]( // [CAREERS]( // [SHOP]( // [FAQ]( Update your email preferences or unsubscribe [here](. View our privacy policy [here](. Copyright © 2024 Morning Brew. All rights reserved. 22 W 19th St, 4th Floor, New York, NY 10011