☕ Contradictions

Americans are shopping like a recession isn’t coming... October 22, 2022 [View Online]( | [Sign Up]( | [Shop]( [Morning Brew]( TOGETHER WITH [Yogi Tea]( Good morning. Each Saturday, the Brew’s Max Knoblauch graces your inbox with a whimsical cartoon. But today, just one week out from Halloween, he went even bigger—crafting an extended comic that illustrates (literally) how it came to be that a small retailer called Spirit Halloween takes over America’s strip malls each fall. Make sure to check it out below. —Neal Freyman, Abby Rubenstein, Matty Merritt MARKETS Nasdaq 10,859.72 +2.31% S&P 3,752.75 +2.37% Dow 31,082.56 +2.47% 10-Year 4.228% -0.4 bps Bitcoin $19,183.66 +0.63% Pfizer $44.95 +4.75% *Stock data as of market close, cryptocurrency data as of 3:00am ET. [Here's what these numbers mean.]( - Markets: Stocks bounced up like Olympic high jumpers yesterday, giving all three major indexes their [best week]( since June. Some of that buoyancy came from the Wall Street Journal reporting that, while the Fed is likely to go for another big rate hike in November, it’ll probably start slowing down after that. Pfizer was among the standout companies after revealing plans to start charging more for Covid vaccines.  ECONOMY [Americans are shopping like the economy isn’t dropping]( [A shopper in a boat sails toward an iceberg]( Will Varner This week, the following things happened: - A Bloomberg economic model forecast a 100% chance of a US recession within 12 months. - Jeff Bezos warned companies to “batten down the hatches” in response to Goldman Sachs’s CEO saying there’s a good chance we’ll have a recession. - Elon Musk guesstimated that we’re going to be in a recession “probably until spring of ’24.” - Gwyneth Paltrow said, “The economy sucks.” This week, the following things also happened: - Bank of America CEO Brian Moynihan (the one with the epic vocabulary) said that while analysts are warning of recession and slower spending, “We just don’t see [that] here at Bank of America.” Transaction volumes for its customers jumped 10% in September and the first half of October over a year earlier. - American Express’s CEO said, “We’re not seeing any changes in consumer spending” and predicted a strong holiday quarter for retail and travel. - Speaking of travel, United Airlines’s CEO is “so optimistic about 2023.” Okay, you get the point: There’s a lot of dissonance in the economy right now. Many business leaders are forecasting an economic downturn and telling people to load up on instant ramen. But the execs who run travel and credit card companies—the ones with their finger on the pulse of the American consumer—say that shoppers aren’t pulling back spending at all. It’s like Americans are watching the forecast call for thunderstorms but, seeing that it’s still sunny outside, are heading out to the waves to surf anyway. Big picture: Recession fears are rising as the Fed jacks up interest rates to tame inflation that’s soaring at 40-year highs. While the definition of a recession is pretty broad, a slowdown in consumer spending would certainly be an indicator of one: It accounts for about 70% of the US economy. Looking ahead…an early sign of slower spending could come from restaurants, which are often among the first to take a hit when economic times get tough. In a [survey]( by Datassential, 30% of respondents said they plan to dine out less or stop going to restaurants altogether in the months ahead.—NF �  �  �  mailto:?subject=Check%20out%20this%20story%20from%20Morning%20Brew%21&body=Americans%20are%20shopping%20like%20the%20economy%20isn%E2%80%99t%20dropping%3A%20https%3A%2F%2Fwww.morningbrew.com%2Fdaily%2Fstories%2F2022%2F10%2F21%2Famericans-continue-to-spend-despite-a-chorus-of-recession-warnings%3Futm_campaign%3Dmb%26utm_medium%3Dnewsletter%26utm_source%3Dmorning_brew%0A%0AWant%20more%20great%20content%3F%20Subscribe%20to%20Daily%20Brew%20%E2%80%94%20Delivering%20the%20latest%20business%20news%20from%20Wall%20St.%20to%20Silicon%20Valley%20daily.%0Ahttps%3A%2F%2Fwww.morningbrew.com%2Fdaily%2Fr%2F%3Fkid%3D4904f90a%26utm_source%3Demail_share%0A TOGETHER WITH YOGI TEA [Brew up some well-being]( [Yogi Tea]( Make this season all about getting in touch with your well-being. Whether you go all in on journaling, try out that perfect dinner-party-worthy recipe, or explore a place you’ve been meaning to visit, the journey’s totally yours—as long as it makes you feel oh so good. And if the crisp air and falling leaves have you craving a warm + nourishing cuppa, cozy up with one of the 40+ flavors from [Yogi Tea](. [Yogi offers herbal, black, and green wellness teas]( made from exotic spices and botanicals found around the world. So no matter what your well-being journey looks like, there are tea options to suit all your different interests and expressions. [Find your flavor of well-being today](. WORLD [Tour de headlines](#) [President Biden]Kent Nishimura/Getty Images Student loan forgiveness halted by court. A federal appeals court yesterday temporarily [blocked]( President Biden’s student debt relief program from moving forward while the court considers a bid for an injunction by six Republican-led states that want the program nixed. The one-page order was handed down a day after a judge dismissed the states’ suit, and the Biden administration must respond to it by Monday night. The pause came after the president said 22 million people had already signed up for the program, and the first loans were expected to be discharged after Oct. 23. The Jan. 6 committee subpoenaed Donald Trump. The House committee investigating the attack on the US Capitol sent out its [official demand]( that the former president testify on Nov. 14 and hand over relevant documents. Of course, that doesn’t mean Trump will necessarily come in for a chat. More likely, it’s the start of a legal battle that will test the power of presidents (and ex-presidents). Meanwhile, Trump’s ex-advisor Steve Bannon was sentenced yesterday to [four months]( in prison for defying the same committee’s subpoena, though the judge said he can remain free while he appeals his contempt of Congress conviction. No excuses not to save for retirement. The IRS [increased]( the amount you can put in your 401(k) for 2023 by a record 9.8% because of inflation. That means you can squirrel away an extra $2,000 next year, if you’re throwing in the maximum amount. It’s the biggest jump ever in terms of both percentage and dollar amount, according to the WSJ. The agency also boosted limits for IRAs, if that’s your thing, as well as a smattering of other types of accounts. INTERNATIONAL POLITICS [How the UK will pick its new produce, er, prime minister]( [Big Ben as a claw machine]( Francis Scialabba Now that Liz Truss has resigned after a term that lasted as long as the lifespan of your average fruit fly, it’s time for the UK to [pick]( a new prime minister. But most of the country’s citizens won’t get a vote (they’d probably choose the lettuce anyway). Here’s what happens now First, each prime minister hopeful must get nominations from 100 of the 357 Conservative Members of Parliament by Monday afternoon. That means three candidates at most have a shot. Depending on how many manage it, the process becomes a choose your own adventure. - If only one candidate succeeds, they’ll be the next prime minister, and we’ll know who it is on Monday. - If two get enough nods, the lawmakers will hold a vote. Should the candidate who loses opt to keep a stiff upper lip and stay in the race, then dues-paying members of the Conservative Party (there are about 170,000) will have until Friday to vote online. - Finally, if support is split among three candidates, the MPs will have a vote to whittle it down to two, and then the dues-paying members will get their turn. But, who’s it gonna be? Recently ousted PM Boris Johnson and Truss’s main rival Rishi Sunak have been named among the top contenders.—AR �  �  �  mailto:?subject=Check%20out%20this%20story%20from%20Morning%20Brew%21&body=How%20the%20UK%20will%20pick%20its%20new%20produce%2C%20er%2C%20prime%20minister%3A%20https%3A%2F%2Fwww.morningbrew.com%2Fdaily%2Fstories%2F2022%2F10%2F21%2Fhow-the-uk-will-pick-its-new-prime-minister%3Futm_campaign%3Dmb%26utm_medium%3Dnewsletter%26utm_source%3Dmorning_brew%0A%0AWant%20more%20great%20content%3F%20Subscribe%20to%20Daily%20Brew%20%E2%80%94%20Delivering%20the%20latest%20business%20news%20from%20Wall%20St.%20to%20Silicon%20Valley%20daily.%0Ahttps%3A%2F%2Fwww.morningbrew.com%2Fdaily%2Fr%2F%3Fkid%3D4904f90a%26utm_source%3Demail_share%0A WORK-LIFE [Surgeon General’s Warning: Your job can be bad for your health]( [Scene from Office Space]( Office Space/20th Century Studios via Giphy You can add “recommendation from the US surgeon general” to your EOY salary negotiation. That’s because the surgeon general [declared]( Thursday that a toxic job can be detrimental to workers’ mental and physical health—and suggested increasing pay as one of the ways to create a healthier workplace. This is the first time the nation’s top doc, usually associated with the stern warning on cigarette cartons, has made a statement addressing the effects of unhealthy work-life. Surgeon General Vivek Murthy’s report said that chronic stress from a job that overworks and undervalues you can hinder your ability to concentrate and sleep, and can lead to mental health conditions and heart disease. - A survey cited in the report found that 76% of US workers had one or more symptoms of a mental health condition like anxiety or depression, a 17% jump from 2019. What’s a “healthy” workplace? If Liz Truss could outlast most of your direct reports, you might need to evaluate your company culture through the report’s five key areas: opportunity for growth, work–life balance, safety, community, and whether or not employees feel valued at work.—MM �  �  �  mailto:?subject=Check%20out%20this%20story%20from%20Morning%20Brew%21&body=Surgeon%20General%E2%80%99s%20Warning%3A%20Your%20job%20can%20be%20bad%20for%20your%20health%3A%20https%3A%2F%2Fwww.morningbrew.com%2Fdaily%2Fstories%2Fsurgeon-general-warning-toxic-workplace-bad-for-health%3Futm_campaign%3Dmb%26utm_medium%3Dnewsletter%26utm_source%3Dmorning_brew%0A%0AWant%20more%20great%20content%3F%20Subscribe%20to%20Daily%20Brew%20%E2%80%94%20Delivering%20the%20latest%20business%20news%20from%20Wall%20St.%20to%20Silicon%20Valley%20daily.%0Ahttps%3A%2F%2Fwww.morningbrew.com%2Fdaily%2Fr%2F%3Fkid%3D4904f90a%26utm_source%3Demail_share%0A TOGETHER WITH CUTS [Cuts]( For MB readers only: [Cuts]( is offering you exclusive access to their *sitewide* 25%–50% off sale for the next 36 hours only. Get a whole new workleisure wardrobe from the company that takes “look good, feel good” to a whole new level. [Shop this exclusive sale]( before it ends tomorrow night. GRAB BAG [Key performance indicators](#) [Candy on a store shelf]Drew Angerer/Getty Images Stat: The cost of celebrating Halloween is looking pretty scary this year, since inflation has spiked candy prices more than a trick-or-treater’s blood sugar level. The price of Skittles has jumped 42%, and Starburst prices are up 35% since last year, according to Datasembly. Candies like Snickers and Reese’s Peanut Butter Cups have hiked prices less, but they were more expensive to begin with, per [Axios](. Quote: “They told me $1.7 million, and I got $1.7 million. I didn’t have the option of bringing home less of the bacon when it comes to building a toilet.” California State Assembly member Mark Haney found himself forced to defend securing state funding for a public works project that would normally be popular—especially if there’s not a Starbucks nearby—a public [restroom](. That’s because between the requirements for government projects and the high costs of building anything in San Francisco, this single-toilet restroom is expected to cost $1.7 million and take two years to complete. Officials stressed that the actual cost could come in lower, but for many, it still doesn’t pass the sniff test (including Haney, who called the cost “insane”). Read: Why you’re never getting a cheap ticket to a popular concert again. ([Vice]() CARTOON [Saturday sketch (special extended Halloween edition)]( [Cover image for a story of how Spirit Halloween Took over spooky season]( Max Knoblauch Chances are you’re planning a trip to Spirit Halloween this weekend to score a costume before all the shelves are bare. But how did this retailer, which was originally a women’s discount apparel store, come to dominate the industry? Max has you covered with an extended comic exploring the meteoric rise of Spirit Halloween—in full Technicolor. [Check it out](. WHAT ELSE IS BREWING - [The US federal budget deficit]( was sliced in half in the last fiscal year as spending on Covid relief programs wound down. - [Balenciaga]( is the latest company to cut ties with rapper Kanye West, now known as Ye, in the wake of his controverisal actions, including antisemitic social media posts. - [Italy]( officially named Giorgia Meloni its prime minister yesterday, making her the first woman to ever have the role and the most right-wing leader the country has had since World War II. - [James Corden]( may have gotten himself re-banned from NYC restaurant Balthazar after insisting to America’s paper of record that he did nothing wrong in berating a server over an omelet. BREW'S BETS Weekend conversation starters: - When you [lose weight](, where does it go? - How do you define [middle class](? - What would we eat if an [asteroid struck Earth](? - What is [glitter](? But who won? We don’t know all the details on this [stretchy cheese contest](, but we do know we want to be a part of it next year. Book rec: Alyssa Hardy’s new book, Worn Out, untangles fashion’s dirty little secrets. Read our interview with Hardy [here](. GAMES [The puzzle section](#) Brew crossword: Big news for Morning Brew fanatics—the name of one of our writers is a clue in today’s crossword. [Find out who it is here](. Open House Welcome to Open House, the only newsletter section that knows the beginning of a horror movie when it sees one. We’ll give you some facts about a listing and you try to guess the price. [Salem, Massachusetts home]Zillow It’s almost Halloween, so today’s [home]( has all the makings of a Conjuring/Amityville/Poltergeist crossover episode. The 2,123 square foot home is in Salem, MA, was built in the 17th century, and is right around the corner from an old cemetery. Spooky and non-spooky amenities include: - 4 beds, 2 baths - Ominous seashell sign - Huge private backyard How much for this quaint but definitely haunted historic home (exorcisms not included)? AROUND THE BREW [Make every day an efficient workday]( [Make every day an efficient workday]( 🖱 Working efficiently means working smarter, not harder. [Shop our Shortcut Guide Mouse Pads]( and make every day an efficient workday. Now available for both Excel and Google Sheets users. The Brew’s newest course, Financial Forecasting, will help you prepare your team for 2023 in just one week. [Reserve your spot today](. Want to level up your personal finance game but don’t know where to start? Don’t worry, we gotchu. Check out [Money with Katie’s Personal Finance 101 series](. 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 $600,000 � � � � � Written by [Neal Freyman](, [Abigail Rubenstein](, [Matty Merritt](, and [Max Knoblauch]( Was this email forwarded to you? Sign up [here](. Accelerate Your Career with our Courses → - [Business Essentials Accelerator](: Become a better communicator, operator, and innovator. - [Leadership Accelerator](: Grow your team, grow yourself, grow your impact. - [Business Analytics Accelerator](: Understand the business of numbers and make better decisions with data. [ADVERTISE]( // [CAREERS]( // [SHOP]( // [FAQ]( Update your email preferences or unsubscribe [here](. View our privacy policy [here](. Copyright © 2022 Morning Brew. All rights reserved. 22 W 19th St, 4th Floor, New York, NY 10011