The Best One Yet
🇺🇸 “How Elections Affect Stocks” — Election Day Economy. Gladiator II’s creativity secret. Bandit Running’s disruption.
Tue, 05 Nov 2024
What happens to the economy on election day?... Less beer, more flight upgrades, flat stocks.We’re about to get the biggest movie day in 2 years… Gladiator II, Moana II, & Wicked (#WickiGladiOna…2).Bandit is now the fastest-growing running brand… because it didn’t copy Nike, it copied Hermes.Plus, the 4th episode of our new show drops Tuesday: The untold origin story of The Jeep — The car that saved the world. 🚙 Subscribe to The Best Idea Yet: Wondery.fm/TheBestIdeaYetLinks to listen. Episodes drop weekly. It’s The Best Idea Yet.—-----------------------------------------------------GET ON THE POD: Submit a shoutout or fact: https://tboypod.com/shoutouts FOR MORE NICK & JACK: Newsletter: https://tboypod.com/newsletter Connect with Nick: https://www.linkedin.com/in/nicolas-martell/ Connect with Jack: https://www.linkedin.com/in/jack-crivici-kramer/ SOCIALS:Instagram: https://www.instagram.com/tboypod TikTok: https://www.tiktok.com/@tboypodYouTube: https://www.youtube.com/@tboypod Anything else: https://tboypod.com/ Subscribe to our new (2nd) show… The Best Idea Yet: Wondery.fm/TheBestIdeaYetLinksEpisodes drop weekly. It’s The Best Idea Yet.See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.
Chapter 1: What happens to the economy on election day?
This is Nick. This is Jack. It's Tuesday, T-Boy. Tuesday, November 5th. And today's pod is the best one yet. This is a T-Boy. The top three pop business news stories you need to know today. Yeah, it is. It is election day. I voted, you voted, Jack voted, we all voted. In fact, half of the country has already voted. Oh, curious what we're thinking about voting?
Well, Jack and I left our political thoughts on our personal handles of Instagram. But it's a big day. Today's show is the best one yet. So Nick, let's jump right into it. Three stories. What do we got for the pod, Jack? For our first story, curious what happens to the stock market on election day? It's actually huge. So Jack and I will tell you how election day affects the whole economy.
Spoiler, less beer, more selfies. For our second story, this month after the election, we're about to experience the biggest movie moment since Barbenheimer. Wicked, Gladiator 2, and Moana 2 all hit theaters the same week. It's WikiGladawana. We got to work on that. What's that called? A portmanteau? It's WikiGladawana. We're rolling with the check. We decided.
But in this movie story, we found the ultimate rule for creativity. And it applies to everyone. And our third and final story is the fastest growing running brand right now. It's Bandit Running. But Bandit running isn't copying Nike. Bandit is copying Hermes. But yetis, before we hit that wonderful mix of stories. Fantastic mix of stories. Love the mix today, Jack. Perfect mix.
Tonight, one of the great, albeit complicated, systems of democracy gets to work. The U.S. presidential election. Because there's only one office voted on by all 330 million Americans. President of the United States. And who do we entrust to conduct the most important of our elections? We trust ourselves. It's about you, me, our neighbors. We run elections together.
Jack and I jumped in T-boy style to our election infrastructure. And honestly, it's so amazing UPS would be impressed. In the most recent nationwide election in 2022, we operated 94,793 different polling places in America. And in those 94,793 polling places, there were 645,219 people, mostly volunteers, who ran the election with patriotism and coffee.
That's according to a report written by Congress every two years. Jack, can you please repeat that for us over there? Our elections are run by 650,000 Americans across nearly 100,000 different polling places. Now, we don't have a central election authority because we divide that power across the states.
And within those 50 states, we also divide power across hundreds of counties and thousands of municipalities. So besties, you add up all those numbers and the result? The elections, they take longer. And the fact that our elections take longer, that's not something to be suspicious about. It's something to be impressed by. It's impressive, and yet trust in our elections is at an all-time low.
We think that's due to misinformation. So here's some information to combat that. First, 650,000 of us are running this election. Second, we have almost 100,000 polling places across the country where those volunteers are working hard. But Jack, we should point out, what about the people who voted early? How do they fit in? Glad you asked.
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Chapter 2: How do elections affect consumer spending?
For our first story, heading into the election, the economy is hot. But on election day, the economy is not. Here's what Americans do with their wallets on the day they open their ballots. Now, Yetis, you've been with us for a while. If you listen to this show every day, you know about the state of the American economy. According to the data, it's the best in the world.
But for many Americans, it doesn't feel that way. Well, the economy is about to switch in a whole bunch of ways. But that switch actually starts today, and we can see it. Social media, the whole industry, is banning political ads after today. They want to avoid the post-2020 misinformation epidemic that happened four years ago.
Another thing that starts today, election betting markets are going dormant. It's going to be another four years until you're active again on one of these election betting apps. And after rising 21% so far this year, stock markets today, they're in wait and see mode. It's the best election year stock market return in the 21st century. But our big question was this.
How does election day affect the whole economy? To answer that question, Nick and I looked at the third quarter earnings season, which just finished last week. And there was one quote we noticed that kind of said everything, wasn't it, Jack? Political campaigns are bad for business. Elections aren't good for business, besties. The CEOs last week on their earnings call united on that one subject.
Now, the key here is something psychological. CEOs said that the negativity of political ads actually dampens consumer spending. When the last thing you saw on TV was a politician saying the world is going to end, your head is not thinking about spending $3,000 on a new washing machine.
Yeah, honey, let's hold off on that Maytag.
Also, ironically, alcohol companies report dry sales in October before the election. Hey, bartender, where do you stand on NATO? No one's doing that right now. According to Constellation, the liquor company that owns Corona and Modelo, they said the more contentious the U.S. election, the less Americans tend to drink. Nick, I just whipped out my frequent flyer mile card.
Over at airlines, nobody is flying today. And nobody flew last week, and nobody's flying this week either. Delta says that revenue will shrink one percentage point this quarter because of the lack of travel this week and the week before and after the election. United Airlines CEO said fewer people travel that week for obvious reasons.
Pro tip, besties, if you're at JFK right now, ask for an upgrade because you're going to get into first class today. It won't be until tomorrow that consumers may finally spend again. In fact, we might even see pent-up splurging that we've been holding back the past month.
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Chapter 3: What are the upcoming blockbuster movies?
Each could be a box office hit because each one has built in existing audiences. They each have biffs built in fans. And that is huge for any product release. Let's kick it off with Moana. Every parent in America is going to take their kids to Moana too. Jack, can you share the wild statistics we discovered about Moana?
According to Nielsen, Moana 1 was the number one most streamed movie of 2023 with 775 million full viewings. That's crazy. And Wicked has been on Broadway for 21 years, grossing $1.6 billion, which puts it number two behind The Lion King. Wicked, the story of the Wicked Witch of the West before Dorothy arrives in Oz. I mean, Gladiator was a commercial and critical success.
Are you not entertained, Jack? It was the number three box office movie in the year 2000, and it won Best Picture. And I quote it every single day ever since. Range is good, Jack. But Besties director Ridley Scott of Gladiator calls Gladiator 2 the best film I've ever made. Which makes me want to put on a helmet and go into the Coliseum right now. Jack, I already got one ready for you.
But yetis, there is another thing that Ridley Scott said that Jack and I think applies beyond the movie industry to all businesses. And that innovative thing he said is our takeaway. You will be entertained. So Jack, what's the takeaway for our buddies doing anything creative? Tell me the film in two sentences.
Yetis, if you want to make a movie, you need to convince someone like Ridley Scott to make it or fund it or do it. And here is Ridley Scott's advice. Tell me the film in two sentences. Tell me the film in two sentences. Besties, if you're working on something creative, it must have at its core a surprising and interesting story that is tellable in one or two sentences.
You might be working on a product. It might be your pitch at a job interview or your pitch to a venture capitalist to invest in your startup. Honestly, it could be any kind of pitch. And Jack and I, we've actually heard this two-sentence advice before, haven't we, Jack? We used it to describe and market our new series, The Best Idea Yet. The Best Idea Yet.
We said it's the untold origin stories of the products you're obsessed with. Yetis, Nick and I share this advice with entrepreneurs. Hone the thing you're working on into its two-sentence essence. And those two sentences better be compelling. Besties, if you can't fit the two-sentence rule, then your story needs some rethinking. Now, a quick word from our sponsor.
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Chapter 4: Why is Bandit Running disrupting the market?
Chapter 5: What is the significance of early voting?
Yeah, honey, let's hold off on that Maytag.
Also, ironically, alcohol companies report dry sales in October before the election. Hey, bartender, where do you stand on NATO? No one's doing that right now. According to Constellation, the liquor company that owns Corona and Modelo, they said the more contentious the U.S. election, the less Americans tend to drink. Nick, I just whipped out my frequent flyer mile card.
Chapter 6: How do political ads impact business?
Over at airlines, nobody is flying today. And nobody flew last week, and nobody's flying this week either. Delta says that revenue will shrink one percentage point this quarter because of the lack of travel this week and the week before and after the election. United Airlines CEO said fewer people travel that week for obvious reasons.
Pro tip, besties, if you're at JFK right now, ask for an upgrade because you're going to get into first class today. It won't be until tomorrow that consumers may finally spend again. In fact, we might even see pent-up splurging that we've been holding back the past month.
Honey, get the Maytag. I want that washing machine now.
And the only big corporate moves that have been happening right up until election day is in the debt markets. It's kind of a nuanced exception, but companies have been issuing bonds before the election to take advantage of the calm before a potential storm. Maytag actually likes the 6% interest rates right now because who knows what they're going to be next week.
Oh, also, Jack and I can't verify this, but we're pretty sure T-Mobile, AT&T, and every telecom company is enjoying the political text messages. Type stop to unsubscribe. I got 23 of them in the last minute. So, Jack, what's the takeaway for our buddies over in the entire American electorate? The biggest wallet in the world is on the ballot today.
Yetis, there's a lot of talk about undecided voters, but the federal government has $6.75 trillion in undecided dollars. The U.S. federal government spends more money than any other entity on Earth. $6.75 trillion in that money. Federal government spending actually makes up a quarter of the United States economy.
If our federal government spending was its own country, it would be the number three largest world economy. Behind only the United States and China. So who's in charge of where that money goes? Well, it's the president and our U.S. Congress. How that money will be raised through taxes and how that money will be spent, both of those are decided today.
So will we have a united government with Republicans or Democrats in control of both the White House and the Congress? Or will we have divided government? Those are the enormous unknowns that are causing our economy to be on pause today. Because today, the biggest wallet in the world is on the ballot. For our second story. This month, we're getting the biggest movie release since Barbenheimer.
Gladiator 2, Moana 2, and Wicked 2. But Jack and I found the one Hollywood lesson that applies to everyone. But Jack, before we kick things off, Twizzler or Hot Tamales? Neither. I'm going with my OG. The biggest basket of popcorn they have with butter spread in the bottom and then spread again on top, plus the biggest Diet Coke they sell, refillable. Well, the correct answer was Mike and Ike's.
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Chapter 7: What is the role of the federal government in the economy?
It was founded by two brothers from New Jersey and another guy, and they were all early employees at Jet.com. Besties, Bandit is four years old, but their sales quadrupled last year. They just raised venture capital money, including from the venture arm of DraftKings. Now, Yetis, here's what Jack and I found fascinating about this story.
You know, last week we covered Hermes, the $200 billion French fashion company. It's the only luxury stock thriving right now. And Jack, last week, what did we say Hermes' secret to success was? It was scarcity. Because you can't buy one of Hermes' $10,000 handbags right now. You have to first join the wait list and wait for quite a while.
Well, Bandit has applied that same Hermes scarcity model, but they've applied it to jogging shorts. At all times, a majority of Bandit's products are sold out, so you have to join a wait list. I've been trying to get the 5-inch shorts for like six months now. Not possible, Jack. I'd try 7-inch shorts if I were you, dude.
I like to show off the calves, but if you want to get first dibs on one of these shorts when they do come out... you got to join Bandit's $125 run club. Just so you know, seven in shorts, they show all the calves you need, man. Yetis, in fact, last week, the New York Times did an article all about Bandit, a full profile, incredible PR, amazing sales opportunity for Bandit.
But 80% of their products were sold out. That's how like scarce they're playing this. Even at this incredible opportunity, they couldn't sell more stuff. Now, some runners accuse Bandit of being elitist. Bandit says they're just happy to push the envelope. But if you did have bandit shorts on for the marathon, you felt elite. Not because of the scarcity, though. Because of our takeaway.
So Jack, what's the takeaway for our buddies over at Bandit Running? Never underestimate the cup holder effect. Yeti is the top reason runners choose Bandit. It's not just the logo, the feel, the vibe. It's the pockets. Their pockets are perfect. The New York Times referenced the word pockets five times in their article. In fact, Bandit engineered a sports bra and a short with three pockets each.
Three perfect pockets because one holds your iPhone, one holds a credit card, and one holds your keys. That's exactly the things that a runner needs to hold on the run. And that is the cupholder effect, when one small non-core detail determines the customer experience. In cars, the most important thing customers care about are actually the cupholders.
With airlines, the most important things customers care about is the Wi-Fi. And with Bandit, the most important things runners care about is the iPhone pocket in the sports bra. So it is wild, Yetis. But the main reason people love Bandit, it's actually for the perfect pockets. So if you want to be the best sports apparel company, believe it or not, you need to be an expert in pockets.
And that is the cup holder effect in action. If you got another great example of the cup holder effect, drop it in the comments. Jack, could you whip up the takeaways for us for T-Boy Tuesday? The U.S. economy has been climbing back, but on Election Day, it's on pause. Because the biggest wallet in the world is on the ballot. For our second story, it's Wicked Gladius Moana 2.
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