Letâs see how wrong everyone was about this year...
December 27, 2023 [View Online]( | [Sign Up]( | [Shop]( [Morning Brew]( PRESENTED BY [CardCritics]( Good morning. Not everyone can be The Simpsons. In todayâs special edition newsletter, weâre going to explore some of the worst predictions for 2023, from the recession-that-never-was to the commercial real estate bomb that hasnât exploded (yet). Then, weâll ask you to take out your crystal ball and give your predictions for 2024. No pressure. âSam Klebanov, Cassandra Cassidy, Molly Liebergall, Matty Merritt, Adam Epstein, Neal Freyman ECONOMY [The recession that never was](
[recession meme]( Stock Market Memes on Pinterest Anyone who predicted a recession in 2023 was about as spot on as those doomer astrologists who warned of an apocalypse in 2012. Most Wall Street pundits spent the fall of 2022 anxiously bracing for an economic slump sometime in the following 12 months. Instead, they were blindsided by various markers of financial strength, like historically low unemployment, solid corporate profits, and even the rising [price of cardboard](. Expecting the worst Bloomberg Economics projected last October that the odds of a recession in the next year were a yikes-worthy [100%](. To be fair, that projection didnât come totally out of nowhere⦠- The Federal Reserve hiked interest rates seven times in 2022 (and it planned to continue doing so) in its fight against 6.5% inflation levels.
- Borrowing costs were skyrocketing for the first time since before the 2008 financial crisis, threatening to hamper business investment and suppress consumer spending. Meanwhile, JPMorgan CEO Jamie Dimon [worried]( that the erosion of consumersâ pandemic savings by price growth âmay very well derail the economy and cause a mild or hard recession.â But the doom never came The US economy grew at an average annualized pace of 3.2% in the first three quarters of the year, with another 1.3% projected for Q4. Inflationâs decline to 3.1% over the year in November and strong jobs numbers have made many experts (including Treasury Secretary Janet Yellen) optimistic that a recessionless cooling of inflationâotherwise known as a âsoft landingââis upon us. Not everyone was a Debbie Downer back in late 2022. Moodyâs Analytics Chief Economist Mark Zandi was one of the few experts who kept the faith for a soft landing. He pointed out that recessions typically come out of the blue and that there was a good chance the Fed would get inflation under control without tanking the economy. Zandi recently said that the economy still looks healthy, in part because companies took out loans when interest rates were low, so many of them were able to avoid a credit crunch. But few saw the vibecession comingâ¦many Americans [feel like]( the economy is faltering despite all the fancy indicators, which some experts blame on high interest payments on consumer debt and the lingering effects of inflation (along with relentless media coverage of them).âSK   PRESENTED BY CARDCRITICS [Did someone say unlimited cash rewards?](
[CardCritics]( Thereâs a lot of card competition out there, but nothing attracts attention (and wallet space) like [unlimited cash rewards](. Not a thing, you say? Well, it is with [this card](. It offers some of the highest unlimited cash rewards CardCritics has ever seen: 2% across the board. Other perks include: - a hefty welcome bonus
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[Meta Connect 2023]( Josh Edelson/Getty Images Mark Zuckerberg has been right about a lot of things: People want to look up other people on the internet, fighting Elon Musk is a bad idea, and smoked meat is yummy. But [Zuck]( and many [investors]( high hopes for the metaverse in 2023 didnât quite materialize. Two years after Facebook rebranded to Meta and with $46.5 billion [lost]( since 2019, the metaverse is no closer to success. And 2023 might have been the year to kill it for good. Whatâs a virtual world without anyone in it? As of last year, only 200,000 people were active in Horizon Worlds, Metaâs VR world, and Meta has yet to provide an update on that number. And for the ones who are thereâ¦itâs not that exciting. Quest 3, the latest iteration of Metaâs VR headset, debuted in October. By many accounts, it was an improvement on the Quest 2. But the problem thatâs plagued the metaverse remained: What do you do once youâre in it? Some who entered the virtual world just couldnât escape the feeling that it was [more boring]( than the real one. Companies shifted away from the metaverse as the focus on artificial intelligence intensified. While Zuckerberg remained bullish on the metaverse, he paid more attention to AI at Meta Connect 2023, Metaâs annual conference. And, as recently as this month, the company pushed new AI developments, including âImagine with Meta AI,â an image-generating tool, alongside updates to its AI assistant. Meanwhile, Meta temporarily listed a battery strap for the Quest 3 as âout of stockâ last month because the product was so glitchy. The company that renamed itself after the metaverse may end up pivoting to AI instead. Maybe this time next year, weâll be talking to you as legless avatars in Horizon Worlds. But probably not.âCC   SOCIAL MEDIA [Elon was wrong about Twitterâbut so were others](
[The X logo appears behind a phone screen with Elon Musk's account on the platform]( Nathan Stirk/Getty Images A widespread prediction for 2023 was that the billionaire who bought Twitter would blow it up, but the only things Elon Musk exploded this year were [two spaceships](. While the bird app still hasnât gone kaput [like everyone thought]( it suddenly would⦠- It also hasnât become profitable like Musk and CEO Linda Yaccarino [keep]( [saying]( it [soon could be](. Instead, X has [lost half its value]( since the acquisition, and ad revenue is down by more than 50% from last year. Thatâs partly because only about 5% of previously verified users paid to keep their badges, foiling Muskâs plan to profit off of blue checkmarks.
- Persistent [glitches]( this year and technical difficulties during a much-hyped Ron DeSantis Twitter Spaces [event]( poked holes in Muskâs dream to turn Twitter into a multifunctional [âeverything appâ]( called X (half accomplished). On the money. Politicians and advocacy groups [warned]( that Muskâs takeover could lead to a rise in hate speech and disinformation on Twitter/Xâand [it did](. Musk has implemented some platform restrictions on data gathering that have stifled dozens of studies trying to dig deeper into these trends, according to [Reuters]( but the EU is [investigating]( X under its new tech rules. Unforeseen: We werenât creative enough to predict that this year Musk would challenge Mark Zuckerberg to a cage match in âancient Romeââand then [not follow through](. Or that he would tell some of his biggest advertisers to [âgo f***â themselves]( for [pausing their spending]( after he endorsed an antisemitic conspiracy. Looking to next yearâ¦maybe in between product meetings about Xâs [new banking feature]( Musk will try to plug his losses with the help of his budding AI company, [X.ai]( which is seeking $1 billion in funding. But he also [said]( a few months ago that X âmay fail, as so many have predicted.ââML   TOGETHER WITH AUTONOMIX
[Autonomix]( With 100+ patents issued and pending, [Autonomix]( has the potential to transform $100b+ in medical markets with their microchip-based technology. The companyâs still taking private investors ahead of their Nasdaq listing. This could be the final opportunity to invest while theyâre still private. [Become an Autonomix shareholder before the opportunity closes Jan. 15](. REAL ESTATE [No commercial real estate crash (yet)](
[An office building with a vacancy poster]( Illustration: Francis Scialabba, Photo: James Leynse/Getty Images Headlines at the end of last year had us all thinking downtowns were about to look like The Last of Us. But we never got that devastating, dramatic commercial real estate crash [that was promised](. And that was with office buildings emptying. US office vacancy rates hovered around 20% in 2023, a rate we didnât even reach during the 2008 financial crisis. And cities like Dallas and San Francisco reached rates as high as 25% and 35%, respectively. So, what gives? Employees are slowly but surely heading back to their desks. It turns out execs donât care that you like doing laundry at noon. More companies, including BlackRock, Amazon, and Salesforce, [ordered]( workers to return to offices at least three days a week this year to justify their vast physical footprints. Still, swipe data in the US analyzed by Kastle Systems showed that only about half as many people are making the trip into the office compared to pre-pandemic numbers. Some companiesâincluding big names like Meta, Publicis, and American Greetingsâare getting creative and [subleasing]( space to other tenants. Not all commercial real estate is struggling. The retail vacancy rate fell to 4.8% in Q2, the lowest in 18 years since real estate firm CBRE started tracking. And big-box stores and malls, shockingly, [are so back](. Thereâs also a big demand for warehouses, data centers, and industrial space thanks to the recent surge of AI and the pandemic-induced e-commerce boom. But another explanationâ¦is that we just havenât seen the worst of it yet. Within the next four years, [about two-thirds]( of commercial real estate loans will likely be refinanced with interest rates much higher than they were the first time around, according to the Yale School of Management. The delinquency rate for these types of loans is expected to double to about 10.5% in the next few years, according to Moodyâs Analytics.âMM   COMMUNITY [Help us predict 2024](#)
[Boromir in The Lord of the Rings]The Lord of the Rings/New Line Cinema/Imgflip As you can tell by now, a lot of people were very wrong about what would happen this year. But letâs see if you can do any better. We put together a quick, 10-question multiple-choice poll asking you to predict the major news events of 2024. Questions include: - Who will win the US presidential election?
- Will stocks go up or down?
- Will Taylor and Travis break up? [Cast your votes here](. Weâll reconvene around this time next year to see how you did. Good luck!âAE RECS
[Wednesday to-do list] This week, weâre bringing you the most-clicked links from the Recs section across the entire year. Tour the US: What each state would look like [as a person]( generated by AI. Watch: How crabs [clean dead skin]( from toes. Make some extra cash: A step-by-step [guide to selling stuff]( you no longer need. Happy holidays from space: NASA Curiosity rover sent a [postcard from Mars](. Be productive: Discover the secrets of sustainable productivity (hint: itâs not just working harder) with Dr. Ali Abdaalâs new book, which you can [pre-order here]( by Dec. 30 to get access to an exclusive bonus workshop.+ Banish bedroom anxiety: MysteryVibeâs [Tenuto 2]( is the only doc-recommended vibrator clinically proven to combat EDâaaand offer both partners a climactic finish. [Take 35% off]( *A message from our sponsor. +Content from an editorial partner. GAMES [The puzzle section](#) Word Search: Which people were Googled the most this year? Youâll find out in todayâs Word Search. [Play it here](. More bad predictions History is full of freezing-cold takes. In this trivia game, weâll give you a prediction that turned out to be very wrong, and you have to figure out who/what the subject of the prediction is. - âWe donât like their sound, and guitar music is on the way out.ââDecca Recording Co., 1962
- âDoesnât have that presidential look.ââUnited Artists exec, rejecting an actor as the lead in the 1964 film The Best Man
- âPoor build, skinny, lacks great physical stature and strength, and gets knocked down easily.ââNFL scout evaluating a combine performance in 2000
- âThis CEO is out for blood.ââthe cover of Fortune magazine in 2014
- âThereâs no chance that the _____ is going to get any significant market share.ââMicrosoft CEO Steve Ballmer in 2007
- Bonus, practically impossible one: âThey will be abandoned because unnecessary. Spelling by sound will have been adopted, first by the newspapers. English will be a language of condensed words expressing condensed ideas and will be more extensively spoken than any other.ââfuturist John Elfreth Watkins Jr. in the Ladiesâ Home Journal in 1900 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. Weâre saying weâll 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 - The Beatles
- Ronald Reagan
- Tom Brady
- Elizabeth Holmes
- iPhone
- The [letters C, X, and Q]( in the year 2000 â³ï¸ A Note From Autonomix This is a paid advertisement for Autonomixâs Regulation A+ Offering. Please read the offering circular at [invest.autonomix.com](. Written by [Adam Epstein]( [Neal Freyman]( Sam Klebanov, [Cassandra Cassidy]( [Molly Liebergall]( and [Matty Merritt]( Was this email forwarded to you? Sign up [here](. Take The Brew to work - Marketers: [Marketing Brew](
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