☕ Major debt

Sam Altman has ambitions beyond AI... [Advertisement] May 16, 2023 [View Online]( | [Sign Up]( | [Shop]( [Morning Brew]( TOGETHER WITH [Virtuix]( Good morning. Yesterday, Sports Illustrated announced that 81-year-old Martha Stewart will appear on one of the covers of this year’s Swimsuit issue, making her the oldest SI Swimsuit cover model ever. Between this and hard-launching Pete Davidson’s current relationship, Stewart is having a productive 2023. Fun fact: For the title of oldest SI cover star, Stewart dethroned Maye Musk, who appeared on last year’s cover at age 74. Yes, that’s Elon Musk’s mom. —Cassandra Cassidy, Molly Liebergall, Sam Klebanov, Abby Rubenstein, Neal Freyman MARKETS Nasdaq 12,365.21 +0.66% S&P 4,136.28 +0.30% Dow 33,348.60 +0.14% 10-Year 3.497% -0.9 bps Bitcoin $27,226.15 +1.60% H&R Block $31.13 -2.84% *Stock data as of market close, cryptocurrency data as of 3:00am ET. [Here's what these numbers mean.]( - Markets: Stocks [climbed]( slightly, with the Dow finally breaking a five-day losing streak as investors keep an eye on Washington, hoping that today’s debt ceiling talks will get us closer to a breakthrough. News out of the capital yesterday wasn’t good for H&R Block or TurboTax parent Intuit: They fell after the IRS announced a plan to let people file their own taxes digitally—for free.  ECONOMY [Consumer debt balloons to historic high]( [Credit card that is being blown up with a bike pump]( Hannah Minn If you’ve been dropping plastic a lot and hoping it’ll take care of itself later, join the club. Yesterday, the New York Fed released its Q1 report on household debt: Findings include a record-high debt level of $17 trillion, persistent credit card debt, and rising delinquency rates. A typical first quarter sees credit card balances decline as people pay off what they spent over the holidays while trying to out-gift their in-laws. But, for the first time since the New York Fed started tracking this 20 years ago, that isn’t the case, according to Bankrate’s senior industry analyst Ted Rossman. Instead, balances remained flat over Q1, suggesting that people aren’t cutting back and are probably using credit cards to finance daily spending due to the rising cost of…pretty much everything. It’s not just that credit card balances are flat. Delinquency is rising, as is its intimidating older brother, serious delinquency, which is when a debt is 90+ days past due. The Fed’s report showed that 4.57% of credit card debt transitioned to serious delinquency last quarter, up from 3.04% in Q1 of 2022. And for credit card holders aged 18–29, 8.3% of balances were in serious delinquency. Plastic isn’t the only thing to blame In addition to causing lots of folks to check their credit card balance real quick, the report had a few key takeaways: - Auto loan delinquencies are higher than they were before the pandemic for those under 40. The average monthly car payment has jumped to $729. - Mortgage debt increased by $121 billion in the first quarter, reaching a $12.04 trillion balance even though mortgage originations were way down, likely due to the Fed’s rate increase extravaganza. - Student debt saw a slight decrease in the rate of serious delinquency, which went down to less than 1%—but that’s probably because repayment is paused for now. Zoom out: Debt balances are almost $3 trillion higher than pre-pandemic, but Fed analysts see one bright spot: Many households are still more financially stable than they were before, thanks to the mortgage refi [boom]( of 2020–2021 when rates were at their lowest.—CC   TOGETHER WITH VIRTUIX [Invest in the ultimate power-up for gamers]( [Virtuix]( The ultimate gaming power-up isn’t gold coins or the ability to see through dungeon walls. It’s realism—that feeling that you are inside the game. And that’s just what [Virtuix]( has done with their omnidirectional VR gaming treadmill: the [Omni One](. It’s designed to fit in your living room *and* offer unrestricted freedom of movement. Sounds next level, right? Yep, but let’s one-up things. [You can invest in Virtuix’s game-changing VR treadmill today]( (and join Mark Cuban and other prominent investors). Virtuix has already raised over $35m. And if you add to that by investing just $1k, you’ll get 30% off your very own Omni One treadmill. That’s a $780 value. Let’s recap: Invest $1k in Virtuix and save 780 bucks on your very own Omni One, but only until May 18. [Invest here](. WORLD Tour de headlines [Illustration of a Call of Duty skeleton with Microsoft logo in his eyes]Illustration: Dianna “Mick” McDougall, Photo: Call of Duty/Activision At least the EU likes Microsoft’s $69b deal to buy Activision. In a win Microsoft needed to change the momentum for its deal with Activision Blizzard, EU antitrust regulators gave its efforts to acquire the Call of Duty-maker [the green light]( yesterday. But Microsoft still has an uphill battle to get the deal through antitrust watchdogs in the UK and the US. UK regulators rejected the deal last month and yesterday criticized the fixes accepted by its EU counterpart. And in the States, the FTC has sued to block it. FBI comes under fire for Trump-Russia probe. Trump-appointed Special Counsel John Durham has finally [released]( his report on the agency’s probe into allegations linking former President Donald Trump’s 2016 campaign to Russia, and he concluded that it should never have happened. The 306-page report states that the agency rushed into the investigation based on “raw, unanalyzed, and uncorroborated intelligence” while being much more cautious regarding claims against Hillary Clinton. The report is unlikely to end partisan fighting over the issue, especially since Durham’s four years of work yielded few court victories. Vice Media filed for bankruptcy. The company, which was valued at $5.7 billion in 2017, [filed]( for Chapter 11 bankruptcy protection yesterday and plans to sell itself to a group of creditors for $225 million. It’s the latest in a string of digital media companies to stumble recently after advertising revenue became harder to come by. Vice’s filing also made it one of seven large companies to head to bankruptcy court in a 48-hour period—the largest number of filings during a two-day period since 2008, according to Bloomberg. TECHNOLOGY [OpenAI founder dreams big about more than AI]( [Sam Altman leaving car]( Sean Gallup/Getty Images OpenAI founder Sam Altman has a lot more going on than just ChatGPT as he comes for Elon Musk’s No. 1 billionaire-innovator spot. He’s about to [secure]( a $100 million funding round for an eye scan-accessible global cryptocurrency project, Worldcoin, according to the Financial Times. Worldcoin is not totally unrelated to his signature project: The company’s [goal]( is to verify whether users are human by scanning their irises to disburse universal basic income...to workers displaced by AI. Finding investors for a crypto startup during crypto winter is just one of Altman’s side projects. The venture capitalist’s resume increasingly looks like a cyberpunk manga. - The Altman-backed nuclear fission startup, Helion Energy, recently notched a deal to supply electricity to Microsoft in 2028, even though most experts say that timeline for making the tech work is a long shot. - But so is expanding the average human lifespan by 10 years, a research effort by Retro Biosciences, which Altman plugged with $180 million. Zoom out: This may all sound like the beginning of a dystopian sci-fi scenario, but Altman claims he’s aware of the potential dangers of his ventures and is concerned with more than just profit. Still, some worry that he won’t be able to build technology at a breakneck pace without unleashing chaos.—SK   TOGETHER WITH STARBUCKS [Starbucks]( Sip on a little something joyful. The Starbucks Frappuccino coffees you know and love are going Mini. Find your favorite Frappuccino coffee flavors, now in a [perfectly sized 6.5-ounce can](. Treat yourself to a Mini can of creamy Caramel or smooth White Chocolate Mocha deliciousness. [Your coffee craving is calling](. TECH [Trade offer: You get a free TV, Telly gets your eyeballs]( [A Telly TV]( Telly Whoever has been making sacrifices to the free television gods just got their prayers answered. The hardware startup Telly is giving away 500,000 55-inch 4K flat-screens at no cost to your wallet. But, like most free things, the TVs come with a [catch]( constant advertisements and data collection. - A never-ending ad stream will play on the dual-screen TV’s lower “Smart Screen,” a nine-inch add-on that can also show weather, stocks, and other widgets. The main screen might also display ads when you’re not using it. - You’ll also have to answer some demographic and psychographic questions when you sign up to make the ads more targeted: “If Toyota wants to run an ad to people that currently own a Honda whose lease expires within the next 12 months, we pick and choose those individual TVs,” Telly co-founder Ilya Pozin, who also co-founded Pluto TV, [told]( the Hollywood Reporter. If you’re okay with all that, you can reserve a free TV on [Telly’s website](. They’re expected to ship this summer. Zoom out: Marketers say it was only a matter of time before a free TV emerged since prices for devices like Roku and smart TV sets have been coming down as ad sales have grown. Ad spending for internet-connected TVs rose from about $6 billion in 2019 to more than $21 billion in 2022, according to Statista.—ML   GRAB BAG Key performance indicators [An image from the Netflix show Queen Cleopatra]Queen Cleopatra/Netflix Stat: Netflix’s Queen Cleopatra made the streamer’s top 10 television show list yesterday, but any success came in spite of the show’s audience score on Rotten Tomatoes. The series, which debuted last week, had a [1% audience]( score over the weekend before ticking up to 2% yesterday with 2,500+ reviews in (by contrast, the Elizabeth Taylor version blamed for destroying multiple marriages has a 68% audience score). But the barrage of negative reviews likely stems at least as much from the backlash against casting a Black British woman as the iconic Egyptian queen as from anything else about the Jada Pinkett Smith-produced series—though its score from professional critics was only a smidge higher (11%). Quote: “The thing that I miss the most about being on the surface is literally the sun.” University of South Florida professor Joseph Dituri, who also goes by Dr. Deep Sea, recently beat the [world record]( for time spent living underwater without depressurization by spending 74 days 30 feet deep in a Key Largo lagoon inside the Jules’ Undersea Lodge. And he’s not about to surface any time soon—he plans to spend 100 days there to complete his research. Despite ascribing to the philosophy that it’s better down where it’s wetter, Dituri admitted he misses seeing sunrise. He doesn’t miss class, though—he’s still teaching online. Read: The greatest wealth transfer in history is here, with familiar (rich) winners. ([New York Times]( NEWS What else is brewing - [Elon Musk]( owns Twitter, but he still can’t say whatever he wants there: A federal appeals court rejected his bid to overturn his settlement with the SEC requiring a lawyer to review his Tesla-related tweets before he posts. In other legal news, Musk was [subpoenaed]( by the Virgin Islands as part of a Jeffery Epstein sex-trafficking lawsuit. - [Two staffers]( were attacked at the office of Rep. Gerry Connolly, a Virginia Democrat, by a man wielding a baseball bat. - [Turkey’s election]( is officially too close to call, though its president of 20 years, Recep Tayyip Erdoğan, was ahead in the voting. A runoff vote is scheduled for May 28. A candidate needs to get more than 50% of the vote to win. - [Chocolate milk]( may come off the menu when the USDA finalizes new guidelines for school lunches, the WSJ reports. RECS Inspiration for your daily routine: Here’s a breakdown of how [famous creative people]( throughout history spent their days. Prettier than a postcard: The world’s most beautiful [post offices](. Corleone vs. Bickle: A debate is raging over [Robert De Niro and Al Pacino]( in their prime. The penultimate inflammable object left us nonplussed: People are sharing the words that [do not mean]( what they thought they meant. Leaders never stop learning: Join our eight-week Leadership Accelerator built by leaders, for leaders. Learn to fine-tune your skillset, make an impact, and network with some of the best in the biz. [Don’t miss your last chance to apply](. Kickoff is May 29. Your best sleep: This [clinically tested sleep hot cocoa]( with ingredients like melatonin and magnesium to help you get quality shut-eye—is now available in chocolate peanut butter ️. [Get up to 40% off with code BREW]( Rich vibes only: Get all the personal finance tips you need to start living your best money-making life with the latest [Money with Katie]( episode, sponsored by [Vin Social]( *This is sponsored advertising content. GAMES The puzzle section Brew Mini: Good crosswords come in small sizes. [Play the bite-sized Mini here](. Famous alumni trivia With graduation season in full swing, here’s some famous alumni trivia. We’ll give you four notable alumni from a college or university, and you have to name the school. - Yo-Yo Ma, Robin Williams, Jessica Chastain, Anthony Mackie - Michelle Obama, David Duchovny, Jeff Bezos, Brooke Shields - Emma Thompson, Alan Turing, Sacha Baron Cohen, Oliver Cromwell - Harper Lee, Paul “Bear” Bryant, Justin Thomas, Kaitlan Collins - David Robinson, John McCain, Jimmy Carter, Roger Staubach - Steve Kerr, Kourtney Kardashian, Rob Gronkowski, Kristin Wiig AROUND THE BREW [Think outside the subscription box]( [Think outside the subscription box]( Wondering how to make a subscription model work? [Download Retail Brew’s guide]( and unlock retail subscription success. We took a deskpad and filled it with important Excel shortcuts to make your workday a breeze. [Shop now](. 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