Morning Brew Daily
Dow Jones’ Worst Streak in 46 Years & Taco Bell Serves…Chicken Nuggets?
Wed, 18 Dec 2024
Episode 477: Neal and Toby discuss the Dow Jones Industrial Average’s historic 9-day losing streak, something that hadn’t occurred since the late 1970s. Should Wall Street be worried? Then, Trump settles with ABC News in a defamation case that could have ripple effects on how media outlets cover Trump. Also, a little-known startup announces a $10B financing round that puts it at a whopping $62B valuation, perhaps starting a new era in data analytics. Meanwhile, Taco Bell enters the fast-food chicken wars with a familiar favorite: chicken nuggets. Lastly, a roundup of headlines to end your day. Build your Range Rover Sport at landroverusa.com 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. Listen to Morning Brew Daily Here: https://link.chtbl.com/MBD Watch Morning Brew Daily Here: https://www.youtube.com/@MorningBrewDailyShow 00:00 - Intro 03:50 - Dow Jones Falling 09:00 - Defamation Cases 13:50 - Databricks startup 19:00 - Taco Bell Chicken Nuggets 23:50 - Headlines Learn more about your ad choices. Visit megaphone.fm/adchoices
Chapter 1: What caused the Dow Jones' historic 9-day losing streak?
Then Taco Bell is loco for pollo. It's adding a surprise new chicken dish to its menu this week. It's Wednesday, December 18th. Let's ride.
Got a fun thought starter for you all this morning. Maybe it'll help you come to a deeper understanding of what makes you, you. So someone on Twitter posed the question, what are your personal foundational texts? You know, the books you keep coming back to, the ones that most represent your values and interests, and you can't fathom having a personal library without them.
Toby, the people want to know, what are your foundational texts?
As part of this prompt, there was the question of these are books you revisit multiple times throughout your life, that you've read multiple times. And by that definition, the only foundational texts that I've read multiple times are mostly sci-fi or fantasy novels. The Eragon series growing up, I read multiple times.
World War Z by Max Brook is a book that I've read is a book I've read three times. The Red Rising series. Most of these were books that I did read as a kid. Then you revisit as an adult. There's something just very cathartic about that. But, you know, if we expand the definition beyond just books you've read multiple times, what are your foundational texts?
Yeah, when I was thinking about this prompt, I was thinking the one that like most values, most represents me as a person and the one that is just like a base layer for me. And I think when I was a kid, I would just look over the Atlas all the time. So I'm going with Atlas as my foundational text. I could just stare for maps at hours. I loved memorizing all of the countries of the world.
So we're going with Atlas. If I had to pick a book with a little more words than maybe Bill Bryson's A Walk in the That's pretty solid. So travel, humor, all those all those themes, I think, represent me as a person.
I thought you were going to say Atlas shrugged at first. And I was like, wait, that's foundational to you. But an Atlas is just as good.
That is too long of a book.
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Chapter 2: What are the implications of Trump's defamation case?
going against, they're saying Trump is trying to say that they violated Iowa Consumer Fraud Act, which prohibits deceptive ads. That one seems like it's less likely to succeed.
But just in general, zooming out here, it is a bit, the word that has been tossed around by a few outlets is that it is a chilling kind of effect to go after these and use your intimidation power as the president-elect to go after these media organizations.
And that's exactly what he wants to do. I mean, he knows he's probably not going to win this because the bar for defamation is so high. He would have to prove Stephanopoulos acted in actual malice or with a reckless disregard to the truth when he could have just been misspeaking. Like Stephanopoulos would have had to been scheming with ABC News staffers.
in order to deliberately lie to the public about Trump. That is very hard to prove. But the point of this may not even be to win it all. Trump has sued many, many major media companies in the past. He's lost pretty much all of them. The ABC News one is the only settlement that he's gotten. He's lost against CNN. He's lost against the New York Times. But
In an interview with The Washington Post, he gave this was in reference to a previous lawsuit he filed against Tim O'Brien, who was a New York Times business reporter at the time. He said he knew he couldn't win, but he brought it anyway to make a point. And this is a Trump quote. I spent a couple of bucks on legal fees and they spent a whole lot more.
I did it to make the reporter's life miserable, which I'm happy about. And the goal here may be just to drain media companies of legislation. resources, financial resources, by making them lawyer up and spend time and divert their attention away from actually covering it.
And then the final, you know, aspect of this case is that trust in the media is at an all-time low. So maybe ABC didn't want to go in front of a jury because there have been instances in the last decade where a jury has not been favorable to a media company. What I'm thinking of is in 2016,
A Florida jury ordered Gawker, which was this online media publication, to pay Hulk Hogan more than $115 million in damages, which ended up bankrupting the media site. So maybe they just did a quick calculus here and say, we don't want to go down that road because juries have proven to be unfavorable in the past in cases similar to this one.
Here's a tech startup you need to know about, Databricks. Yesterday, the software company raised a staggering $10 billion funding round at a $62 billion valuation, and some superlatives are in order. That is likely the biggest venture capital fundraising round of all time, and it cements Databricks as one of the fastest-growing companies in Silicon Valley.
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Chapter 3: What is Databricks and why is its funding significant?
Chapter 4: Why is Taco Bell introducing chicken nuggets?
Well, I'm a journey guy, not a destination guy, so I need some long scenic roads where I can just toss it on cruise control and go. Some good classical music is always nice, but arguably the most important thing is a smooth and comfortable ride.
The Range Rover Sport has all the bases covered. It's got adaptive off-road cruise control that monitors ground conditions and acclimates to your present terrain, as well as dynamic suspension that reduces unwanted body movements.
I haven't had a good road trip in a few years, Toby, but this is making me want to get up and go.
Well, finish the pod first, then the open road is all yours. Explore the Range Rover Sport at LandRoverUSA.com. That's LandRoverUSA.com. The Dow Jones Industrial Average is one of the most well-known stock indexes in the world. and it just did something it hasn't done since Jimmy Carter was in office.
Like Pep Guardiola's Manchester City side, things have been going decidedly downhill recently for the Dow. It has now finished in the red for nine straight trading days, suffering its longest losing streak since 1978. To make matters worse, the Dow has been heading south while everyone else heads north.
Both the broader S&P 500 index and the tech-focused Nasdaq have notched record highs in the last week compared to a 3.5% decline for the Dow. What's dragging it down? Well, UnitedHealth Group is down 3%. Thank you for watching. Still, more than two-thirds of the Dow Jones members have also fallen over this same period, so it's not just a one-company issue.
Neil, as we enter into the last few weeks of the year with an important Fed meeting on the horizon, stocks are exhibiting some squirreliness.
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Chapter 5: What headlines should we be aware of today?
Still. This is, I would say, the chillest historic sell-off ever. What we've had, nine straight losing days for the Dow, and overall it's down 3.5% over that period. That is just not a big deal in the grand scheme of things. But this is mostly a UnitedHealth story. It is down 30%. since the shooting, so there's been greater scrutiny around health insurers.
It's not just about the shooting, though. There is a push among Congress to force the large health companies like UnitedHealth, like CVS, to divest their pharmacy units in order to break up what they think is more of a monopoly that these companies have. So it is mostly a UnitedHealth story, and I do want to home in on the fact that the Dow is...
Generally considered a misleading index because of the fact that it's weighted by share price. I'm just looking at the companies that move the Dow the most. And it's Goldman Sachs, number one, United Health, number two, Sherwin-Williams, number six. So the paint company, we're not even close to getting to Amazon, NVIDIA or JP Morgan.
So the paint company, Sherwin-Williams, no offense to Sherwin-Williams, moves the Dow more than Amazon, NVIDIA or JP Morgan. So it is very skewed. And I think that's why investors are mostly brushing this off.
Right. It's more of a headline, like you get to say, longest losing streak since 1978. But it is almost opposite day as you go down the Dow because you have companies like NVIDIA who have been actually stinking it up recently a little bit. It's down 17% since it hit a record high in November 21st. Sherwin-Williams is down about 7%. That's a recent addition to the index.
Boeing has jumped 10% over that nine-day losing streak and is actually the top performing stock in the index over that period as well. It is also the biggest loser if you zoom out to the year as a whole.
So this nine-day period has just been a little funky where part of the reason why you see all the other indexes around it going up is that the Magnificent Seven, those tech-focused companies, have climbed about 8% in that same period, which is pushing the NASDAQ and the S&P 500 up.
higher, but it is just a little bit of a weird time on the Dow, even though it is technically a historical losing streak.
Andy, you teased this at the top, but there is a big Fed meeting today, which is certainly getting investors a little nervous. We're pretty sure, or pretty much guaranteed that the Fed chair, Jerome Powell, is going to cut rates for the third time this year. The big question, we're all going to be paying attention to this at the 230 press conference, is what he signals for next year.
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