Morning Brew Daily
Amazon Dethroning Walmart? & DOGE Hits Snag in Treasury Overhaul
Fri, 07 Feb 2025
Episode 514: Neal and Toby discuss Amazon’s slowly catching up to Walmart, set to bring in more revenue than the King of Retailers. Then, a judge temporarily blocks Trump’s buyout offer to hear arguments in the courts. DOGE is forced to take a step back as lawyers give it only limited access to the Treasury payments system. Meanwhile, Panama’s President dispels some claims that the US gets a free pass through the Canal. Workday is the Stock of the Week and Billabong is the Dog of the Week. Finally, a roundup of the biggest Super Bowl news heading into the Big Game. Subscribe to Morning Brew Daily for more of the news you need to start your day. Share the show with a friend, and leave us a review on your favorite podcast app. Check out https://wise.com/business for more! Listen to Morning Brew Daily Here: https://link.chtbl.com/MBD Watch Morning Brew Daily Here: https://www.youtube.com/@MorningBrewDailyShow All investing involves the risk of loss, including loss of principal. Brokerage services for US-listed, registered securities, options and bonds in a self-directed account are offered by Public Investing, Inc., member FINRA & SIPC. Public Investing offers a High-Yield Cash Account where funds from this account are automatically deposited into partner banks where they earn interest and are eligible for FDIC insurance; Public Investing is not a bank. Cryptocurrency trading services are offered by Bakkt Crypto Solutions, LLC (NMLS ID 1890144), which is licensed to engage in virtual currency business activity by the NYSDFS. Cryptocurrency is highly speculative, involves a high degree of risk, and has the potential for loss of the entire amount of an investment. Cryptocurrency holdings are not protected by the FDIC or SIPC. APY as of 1/16/25, offered by Public Investing, member FINRA/SIPC. Rate subject to change. *Terms and Conditions apply. Learn more about your ad choices. Visit megaphone.fm/adchoices
Chapter 1: What is the main topic of this episode?
Then a move over Walmart. A new company has laid claim to the title of highest revenue generating business in the world. It's Friday, February 7th. Let's ride.
Good morning and happy Friday. Look, if you're spending an entire paycheck on a carton of eggs these days, you might as well prepare them to perfection. And scientists now say they've discovered the recipe to cook the best possible boiled egg. It'll just take you 32 minutes.
In a study published Thursday in the journal Communications Engineering, the scientists recommend putting eggs in a steamer basket, then transferring them between two bowls of water every two minutes. one boiling and the other set to 86 degrees Fahrenheit, lukewarm, until 32 minutes are up. That process, known as periodic cooking, yields a velvety yolk and a meaty but soft white.
Toby, my deviled eggs for the Super Bowl party are about to blow people's minds.
When I first heard about this study, I was like 32 minutes, way too long. But then I thought a chalky yolk is one of the most tragic substances on earth. I would rather starve than eat a chalky yolk. So I am all in on this method. And I also happen to be a big fan of Gordon Ramsay's scrambled eggs cooking style, which also involves taking it on the heat, off the heat. Back on the heat.
So I've kind of already done this. If I'm willing to devote that much time to making scrambled eggs, why wouldn't I spend half an hour doing this method? We have to try it.
I will absolutely try it this weekend.
It's been lofty, but that perfect texture, that velvet yolk, I think it's worth the extra time. Now a word from our sponsor, Wise Business. Neil, fun fact, I grew six inches my junior year of high school.
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Chapter 2: How is Amazon challenging Walmart's dominance?
Good God, how many pairs of pants did you go through?
So many, but that is part of growth. You gotta make changes.
And if you're a business owner going through change, instead of just wearing longer pants, you have to upgrade your software and build out new systems.
And if you grow internationally, whew, that can be a real pain.
That's why you need a business account that can grow alongside you. Wise helps you save money, time, and stress on making payments and getting paid internationally.
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Like a river overtaking the dam that once controlled its flow, Amazon is almost certainly set to bring in more revenue than its rival Walmart this past quarter for the first time ever. For a decade, Walmart has reigned as the world's biggest company by revenue.
But analysts project Wally World will announce sales of $180 billion when it reports earnings later this month, while Amazon announced yesterday that it had brought in $187 billion in revenue in the fourth quarter. This was a long time coming. had been growing at a 12% clip year over year, while Walmart's revenue growth was just 6%.
As the two have duked it out for the title of biggest retailer in the world, they have also grown more similar. Amazon has invested heavily in groceries, while Walmart has dipped its toe in a Prime-like membership service, built out a robust e-commerce operation, and experimented with advertisement revenue.
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Chapter 3: What are the legal challenges facing DOGE in the Treasury system?
Or in his words, I am incredibly surprised by yesterday's statement. They're making an important institutional statement from the entity that governs U.S. foreign policy based on a falsity. And that's intolerable. After the blowback, Rubio said, OK, maybe you're right. At a press conference, he said that the U.S.
expects Panama to remove the fees, but acknowledged that Panama has a process of laws and procedures that they need to follow.
Yeah, and actually that process is tied to a 1977 treaty, the treaty that actually originally handed over control of the canal to Panama. There's a clause in that treaty that requires equal treatment of all canal users, so you can't do these carve-outs for specific nations like Rubio and Trump are pushing for. What's ironic, too, is that over the past 26 years, the U.S.
has paid $25 million for warships and submarines to pass through. That comes out to less than a million dollars a year. It is not a big chunk of change that we're talking about. It does seem to be more of like a symbolic victory that Trump and Rubio are pushing for. Because it just really isn't. I mean, look at the percent of the total ships that pass through each year. 0.5% are U.S. Navy vessels.
So it just doesn't affect that many things, which is why it's interesting that kind of this administration is making such a big deal out of, you know, trying to get free passage for these ships. Up next, Stock of the Week, Dog of the Week time. We know our listeners are above average. And that means you deserve above average everything, including your savings account interest rate.
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Chapter 4: Why is there controversy over the Panama Canal's usage by U.S. ships?
Yeah. Klarna is another big name that has cut a lot of employees to make space and replace them with AI. They say they've saved $10 million annually for using AI for its marketing needs. And then very ironically, Klarna also drastically reduced their usage of software platforms like Salesforce and Workday and replaced them with AI. So it's not just humans.
It also is the other software stack that usually are used to run these big organizations. So It is cuts all the way down, and it is interesting to see how these layouts are just met so positively by the market. Whenever you say those magic words, it's like we are cutting costs in this area, putting it towards this area, being AI instead. The market usually tends to like that.
Figures I get dog of the week because this one strikes at the heart of my identity. A millennial who grew up in the suburbs and wanted to dress like a skateboarder.
Quicksilver, Billabong, and Volcom, popular outdoor clothing brands for skaters, surfers, and the wannabes, are closing virtually all of their stores across the country after their parent company, Liberated Brands, filed for bankruptcy. The silver lining, or I should say Quicksilver lining, you can still buy those clothes.
The brands will continue to make them just under a license from a different company called But it won't be from their namestake stores. More than 120 of the locations will close in the coming weeks. What went wrong at Billabong?
Liberated CEO blamed macro forces like a rise in interest rates, inflation and supply chain delays, while also criticizing the fast fashion industry for allowing shoppers to, quote, cheaply, quickly and easily order low quality clothing garments. Toby, a sad day. Quicksilver was always a must stop on the high school mall date.
It absolutely was. It is kind of the end of an era, too. So you can blame a lot of things. Obviously, you can blame interest rates, inflation, supply chain delays. Those are all very valid. But the last thing that its CEO said was shifting consumer preferences, which I think you cannot ignore either. I really think that these brands kind of rode the wave of the board short era, the skateboard era.
But now if you go to the beach, for instance, you're seeing a lot of thigh out there. Five-inch inseams. I haven't seen an inseam longer than five inches in a long time. So I really think the thighs killed Billabong, killed Quicksilver, killed Volcom, these brands that kind of rose a very specific aesthetic to prominence. But yeah, they aren't going, they're not dying per se.
You just won't see them in the malls anymore where you were taking all your dates, Neil.
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Chapter 5: What are the featured stocks and companies in this episode?
when the logo included orange and yellow matching the Bengals and Rams who matched up in that Super Bowl. The next year, it was red and green for the Eagles and Chiefs, and now it is again for their rematch. The other conspiracy is a little more serious, and it suggests that the NFL and its refs are in the bag for the Chiefs, rigging the league so that they can win three championships in a row.
And of course, there's some Taylor Swift voodoo thrown in since she's dating Chiefs tight end Travis Kelsey. People noted how she may have sprinkled fairy dust on the Superdome when she played Error's Tour shows there last year, manifesting her boyfriend to be competing in the game months later. Toby, you buying any of these?
I believe them all, especially the fairy dust sprinkling. I do want to talk about the Chiefs and the fact that the refs had to come out and say, the league had to come out and say, no, the refs are not colluding. One thing that they pointed to is that there are 17 officiating crews consisting of 138 officials that...
refereed Chiefs games and the league was like, do you really think they're all colluding to assist one team? That being said, though, there is some data that you could point to that say maybe the Chiefs do get more favorable calls, especially in the playoffs. If you look at the 2023 and 2024 postseasons, The Chiefs have been called for 16 fewer penalties for 160 fewer yards than their opponents.
But what you have to look at is how much of those penalties add to the win probability of each game. And over those six games, their win probability has jumped 27% based off the calls that they have gotten. That is just behind the Green Bay Packers amongst all teams.
So it is interesting that you can point to their postseason runs since Patrick Mahomes really took over and look at how much win probability
was added the final thing i will say on this though you can go back to the 2013 to 2017 new england patriots and they got even more lopsided treatment than the current chiefs they were getting called for 22 fewer penalties 276 fewer yards than their opponents so i think basically whenever some team is good you something happens where the refs kind of contribute to that in some way so i
Do I believe the conspiracy theories? No, but just follow the data. That's all I'll say. Finally, sportsbooks are expecting $1.4 billion in legal wagers on Sunday's game, which would be a new record. And while a lot of those bets will likely be on the Chiefs for the Eagles to win, we want to surface some... prop bets you should be aware of.
Prop bets are those side bets that don't directly influence the outcome of the game, but are fun to root for nevertheless. Think, what color will the Gatorade be? Will the coin toss be heads or tails? So Neil, while I got you here, I'm going to get your thoughts on some of the more interesting prop bets this year. Up first, will the national anthem be longer or shorter than 120 seconds?
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