Morning Brew Daily
RTO Wave Hits Federal Workers & $500B Investment Powers AI Industry
Wed, 22 Jan 2025
Episode 502: Neal and Toby chat about Trump’s order to make all Federal workers to work in the office full-time. Will this ultimately be a winning move in Washington? Then, a multi-billion dollar joint venture by AI leaders and the Trump Administration to power American AI infrastructure. Plus, Netflix reports a record-breaking performance in its last quarter, adding millions of subscribers thanks to its hit shows and live sports. Meanwhile, Olympic athletes are noticing their medals are slowly deteriorating…but weren’t the medals made by LVMH? The company doesn’t see a problem. Lastly, Costco, a rare Winter storm, JetBlue, and Ichiro are in today’s roundup of headlines. 00:00 - Do audiobooks count as reading? 3:20 - Trump wants Fed workers back in the office 8:30 - AI infrastructure gets $100B boost 12:00 - Netflix reports record-breaking Q4 18:00 - LVMH Olympic medals tarnished 21:00 - Sprint finish! 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. Download the Yahoo! Finance App (on the Play and App store) for real-time alerts on news and insights tailored to your portfolio and stock watchlists. Listen to Morning Brew Daily Here: https://link.chtbl.com/MBD Watch Morning Brew Daily Here: https://www.youtube.com/@MorningBrewDailyShow Learn more about your ad choices. Visit megaphone.fm/adchoices
Chapter 1: What are the implications of Trump’s order for federal workers?
Untertitelung aufgrund der Audioqualität nicht möglich.
John, I have some thoughts about this and I'm going to tell a quick story to illustrate them. My mom recently added me to her audible premium account. Shout out mom. But then she was snooping on some of the books I downloaded and she was roasting my choice to listen to the Odyssey. First I had to explain to her that I wanted to brush up on. Ich hoffe, es hat euch gefallen. Was sagst du, Neil?
Und du hörst in der originalen Ancient Greek, oder? Oh, natürlich. Nein, ich habe... Ich habe einige der Übersetzungen gesucht. Ich kann nicht wirklich erinnern, welche ich gerade höre. Aber es ist egal. Wer die Übersetzung macht, beeinflusst die Art und Weise, wie du mit der Geschichte interagierst. Also nein, nicht Ancient Greek, aber ja, ich bin Team Audiobook.
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Vielen Dank. Still, Trump has launched the opening volley, one of several orders he signed on day one that intends to remake the gigantic federal workforce.
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Chapter 2: How is the AI industry being funded?
The question here is how much of that gigantic federal workforce is actually currently working from home. And depending on who you talk to, you might get different answers. Senator Joni Ernst from Iowa, she released a report last year that claimed that only 6% of federal workers were actually in person full time. But then you look at the U.S.
Office of Personnel Management and they push back on that. The OPM noted that 54% of the 2.3 million civilians employed by the federal government... Vielen Dank. who has been very vocally open about wanting to push for RTO mandates in order to shrink the federal workforce.
They're hoping that when people have to go into the office full time, they'll just quit, which is, we've called it sneaky layoffs. It's not so sneaky. Elon has come out and said that is what he wants to happen. So it really is about where you fall politically when you are considering how to react to this RTO mandate.
And, you know, there is a good argument to be made that if you force people to come to the office, then they will just quit. A new survey from Pew found that nearly half of remote workers would consider leaving their jobs if their employers no longer allowed them some remote flexibility.
Chapter 3: What record did Netflix achieve in Q4?
Trump administration is saying, you know, it's taking its cue from Elon Musk and being like, okay, well, maybe that's good. We want a smaller federal workforce. On the other side, you say, you have people saying, Ja, genau. What you're trying to do. So this is going to be an absolute fight. The American Federation of Government Employees represents 800,000 federal and DC government employees.
That's a big chunk of that 2.3 million number. They have collective bargaining agreements, environmental protection agencies, social security administration that have locked them into remote work policies. So as we've seen with other Trump executive orders, this is absolutely going to run into some legal more where there's going to be a fight, possibly.
in the courts to see whether these government workers are gonna come to the office or not.
Just in general though, zooming out, it definitely looks like the winds are shifting towards RTO. You mentioned all the big corporate organizations that are asking their workers to return to office, but you Ja, genau. Ja, genau.
It'll be interesting to see, because over the last few years we've seen young workers who are just graduating from college really gravitate towards government jobs. That was one of the fastest growing sectors for recent grads who were going away from big tech companies and big banks that just weren't hiring as much. The government was hiring.
So we'll see whether these changes that Trump is implementing, and I should mention, RTO is not the only one. There's a lot of other... a lot of other changes he's making to the federal workforce that could maybe dissuade people from working for Uncle Sam. There's going to be more data centers than Dunkin' Donuts if Donald Trump gets his way.
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Chapter 4: Why are Olympic medals deteriorating?
Yesterday afternoon, the president, flanked by OpenAI's Sam Altman, Softbanks' Masayoshi-san and Oracle's Larry Ellison, announced Project Stargate, a joint venture that aims to supercharge the construction of AI infrastructure like data centers in the United States. Das wird viel Geld nehmen, aber mit diesen Leuten geht es nicht um Fundierung.
Die Venture wird sofort 100 Billionen Dollar anbieten und das dann bis zu 500 Billionen Dollar aufbauen. Die ersten Projekte, Datenzentren in Texas, sind bereits unterwegs, hat Ellison gesagt. Die Announcement bietet den ersten Blick auf Trumps AI-Polizei-Agenda, wobei sein Voraussetzer Biden AI-Expansion unterstützt hat.
He also put up guardrails on the new technology to avoid the robot apocalypse and other harms. To that end, Biden signed a comprehensive executive order on AI safety. Things will probably be much less regulated going forward. Trump already tossed Biden's AI executive order in the trash on his first day.
Chapter 5: What are the latest headlines in business?
And with Project Stargate, he's signaling to tech companies, prepare your ships for ludicrous speed.
AI-Leaders for a long time have been sounding this alarm that, hey, we need more, more of everything. We need more of the chips that you use to train the model. We need more of the electricity used to power those chips. We need more water to run these data centers. And the Die andere Seite davon ist, dass wir unseren Mund vor China halten müssen.
Das war etwas, was Sam Altman ausgesprochen hat, dass wir diese Infrastruktur-Bildung brauchen, um uns vorzunehmen und die USA vor China in der KI zu halten.
Und du kannst sehen, warum Trump mit uns an Bord ist, weil wenn du diese AI-Race in Sachen wie die Ökonomie und die Militär, die AI sicherlich beeinflussen wird, kannst du sehen, warum du diese massive 500-Billionen-Dollar-Joint-Venture hast, um die USA in die Vordergründe der AI-Recherche zu bringen.
One thing to look at with the build-out of data centers, you kind of mentioned it, is how much energy they consume. We're expected to supercharge our dependency on the grid, perhaps break its current form. We need more energy. And under the Biden administration, there was a big focus on Using clean energy to power data centers.
And under this new administration, it looks like we don't care what kind of energy you use. It's up to you. Just figure out a way you can use fossil fuels, you can use clean energy. Now the responsibility is on Microsoft, Amazon, Google to source clean energy if they want to fill their commitments. They're already going way past their clean energy thresholds. Vielen Dank.
Vielen Dank. Es ist ein tolles Foto-Op. Netflix hat gestern Erneuerungen angekündigt und der König der Streamer hat seine Krone immer noch auf dem Platz. Der Streaming-Giant hat 18,9 Millionen neue Zuschauer im vierten Quartier erweitert, um 44 Prozent von einem Jahr früher. Das führt zu Revenue- und Profit-Beats im Prozess.
Eine Kombination von Squid Games 2, die die Intrigue von Saison 1 verkündet, sowie ihr Live-Events-Katalog, das viele Augenbrauen bringt, hat Netflix in einem anderen starken Quartier gestärkt. It caps off a year where Netflix just dominated. It added a total of 41 million customers in 2024, more than double what Wall Street had expected. It is now sitting pretty with over 301 million subs.
But remember that number because it's the last time we're going to hear it. The company has said that this earnings report will be the final time it discloses quarterly subscriber numbers as it aims to shift investor focus from subscriber growth to more traditional financial metrics. Speaking of financials, Netflix is trying to milk us all for more cash.
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