Morning Brew Daily Podcast Summary
Title: Canada Pulls US Liquor From Shelves & Can Fries Save Sweetgreen?
Hosts: Neal Freyman and Toby Howell
Release Date: March 7, 2025

1. Introduction

In the March 7, 2025 episode of Morning Brew Daily, hosts Neal Freyman and Toby Howell delve into significant economic and business developments impacting both the United States and Canada. The episode navigates through a variety of topics, including the latest jobs report amidst government workforce reductions, escalating trade tensions affecting the liquor industry, advancements in private lunar exploration, and notable shifts in the corporate landscape.

2. Daylight Saving Time Changes

Neal Freyman [00:48]:
Neal begins the show by reminding listeners that Daylight Saving Time (DST) is commencing that weekend. Clocks will spring forward at 2 AM on Sunday, resulting in the loss of one hour of sleep but granting an extra hour of evening daylight. For example, the sun in New York City will set at 6:57 PM post-DST, up from 5:55 PM the previous day.

Toby Howell [01:23]:
Toby humorously contemplates the pros and cons of DST, noting benefits like extended evening activities and drawbacks such as challenges for parents and morning-oriented individuals. He concludes that the automatic updating of clocks mitigates personal inconvenience.

3. Jobs Report Amid Federal Workforce Cuts

Neal Freyman [02:36]:
Neal emphasizes the significance of the upcoming jobs report, the first since President Trump and "DOGE" (presumably a governmental body or policy) initiated significant reductions in the federal workforce. With economic growth indicators raising recession fears, this report is pivotal in assessing the labor market's resilience.

Toby Howell [04:00]:
Toby speculates that the current jobs report may not yet reflect the impact of recent federal job cuts due to timing delays. He highlights February’s unprecedented surge in layoffs, particularly within government agencies, noting a 245% increase in Christmas-related job cuts compared to January, totaling 62,000 positions.

Neal Freyman [05:13]:
Neal discusses the potential ripple effects of federal job reductions, while pointing out that federal employment constitutes less than 2% of total U.S. employment. He suggests that unless these cuts significantly affect the private sector, the overall impact on the jobs market might be limited.

Toby Howell [06:00]:
Toby presents forecasts predicting over 500,000 job losses by year-end, which could negate a quarter of the job growth from 2024. He also notes state governments are actively recruiting displaced federal workers, with initiatives like New York’s “You’re Fired, We Say You’re Hired” campaign aiming to fill 7,000 state positions.

4. US-Canada Trade War Impacting Liquor Industry

Toby Howell [07:23]:
Toby reports that Canadian provinces are removing American liquors, such as Jack Daniels and California wines, from shelves in retaliation against U.S. tariffs on Canadian imports. Premier Doug Ford of Ontario declared American alcohol products "done, gone," severely impacting Kentucky's $9 billion bourbon industry and over 23,000 jobs.

Neal Freyman [08:30]:
Neal elaborates on the symbolic nature of targeting spirits in trade wars, explaining that while liquor sales to Canada represent only about 1% of Brown-Forman’s total revenue, the move serves as a strategic message in the ongoing trade conflict.

Toby Howell [09:17]:
Toby highlights that the U.S. is the largest export market for Canadian alcohol, with over $763 million in sales. The Distilled Spirits Council of the United States estimates that these tariffs could lead to the loss of over 31,000 U.S. jobs, exacerbating the industry's challenges amid pre-existing post-pandemic sales declines.

Neal Freyman [10:06]:
Neal updates listeners on President Trump’s recent delay of tariffs on Canada and Mexico under the USMCA agreement, while Justin Trudeau confirms that the trade war will persist. This uncertainty has led to significant stock market volatility, with the Nasdaq experiencing a sharp 10% decline from its peak.

5. Private Lunar Landings: Intuitive Machines vs. Firefly

Toby Howell [11:01]:
Toby discusses recent developments in private lunar exploration, specifically Intuitive Machines' Athena lander and Firefly's Blue Ghost lander. Athena's uncertain landing near the moon's south pole raised concerns due to unexpected performance issues reminiscent of its twin craft, Odysseus, which tipped over after landing.

Neal Freyman [12:24]:
Neal explains the technical challenges of robotic lunar landings without an atmosphere, comparing them to re-entry procedures on Earth. He notes that Athena attempted to slow from 25,000 mph to 6 mph using jet engines, a difficult feat that has so far been unsuccessful.

Toby Howell [13:15]:
Toby contrasts Athena’s tall and narrow design with Firefly’s short and squat Blue Ghost lander, suggesting that Athena’s design increases the likelihood of tipping over. He humorously recommends design changes to prevent repeated failures.

6. Stock of the Week & Dog of the Week

Stock of the Week: Sweetgreen’s Ripple Fries

Toby Howell [16:06]:
Toby highlights Sweetgreen's introduction of Ripple Fries—air-fried avocado oil-coated fries—as a strategic move to diversify beyond salads. The stock surged 5% following the launch, reversing a 34% decline since February. Despite Sweetgreen’s $90 million loss last year, Ripple Fries aim to attract more customers and improve profit margins.

Neal Freyman [17:09]:
Neal connects the launch to cultural trends like "girl dinner," positioning Ripple Fries as a complementary item to Sweetgreen's salads. He notes that the product’s low grease content, achieved through air frying, has been positively received in reviews.

Dog of the Week: Management Consulting Firms

Neal Freyman [18:32]:
Neal identifies management consulting firms as the "Dog of the Week," citing significant stock declines for companies like Booz Allen Hamilton and Accenture due to federal government contract cuts under DOGE's initiatives. Booz Allen’s shares plummeted over 40% since November, heavily impacted by reliance on public sector revenue.

Toby Howell [19:44]:
Toby elaborates on the unprecedented scale of contract cancellations, with over 30 contracts terminated in six weeks. He discusses the implications for the consulting industry, including stalled growth and reduced bids for future government contracts, signaling a major industry upheaval.

7. Additional Headlines

Walgreens Takes Company Private

Neal Freyman [20:59]:
Neal reports that Walgreens is being taken private by Sycamore Partners in a leveraged buyout valued at approximately $10 billion, a stark decline from its $100 billion valuation in 2015. The move aims to facilitate a turnaround away from public market pressures.

Eurostar Suspensions Due to Unexploded Bomb

Neal Freyman [22:02]:
Neal informs listeners of the suspension of Eurostar services between Paris and London following the discovery of an unexploded World War II bomb near a major Paris station. This incident has halted over 226 million travelers’ routes across Europe for the day.

Air France Shifts Focus to Wealthy Travelers

Toby Howell [23:19]:
Toby discusses Air France’s strategic pivot to cater to affluent American travelers, introducing $24,000 first-class tickets and enhanced premium cabins. This shift compensates for the loss of corporate travelers post-pandemic, leveraging high-paying passengers to sustain revenue.

Denmark Ends 400-Year Postal Mail Service

Toby Howell [25:05]:
Toby announces that Denmark’s state-run postal service, Post Nord, is discontinuing letter deliveries due to a 90% decline in volume since 2000. The shutdown affects 271,000 individuals who still rely on physical mail, reflecting a global trend towards digitalization in postal services.

Neal Freyman [26:17]:
Neal underscores that Denmark's decision mirrors moves in other countries, such as Germany and the UK, where postal services are cutting jobs and reducing services. He highlights President Trump's proposal to privatize the U.S. Postal Service, indicating a widespread decline in traditional mail usage.

8. Conclusion

Neal and Toby wrap up the episode by encouraging listeners to share the podcast and reflecting on the day's discussions. The episode underscores significant shifts in government policies, international trade, private sector innovations, and corporate strategies, painting a comprehensive picture of the evolving business landscape.

Notable Quotes:

• Neal Freyman [00:48]:
  “This weekend at 2 AM On Sunday, clocks will split spring forward, which means you will lose an hour of sleep but also gain an extra hour of daylight in the evenings.”

• Neal Freyman [02:36]:
  “This one feels like a big freakin' deal for a few reasons.”

• Toby Howell [07:23]:
  “It's not going to make a huge impact, but it is more symbolic.”

• Neal Freyman [10:06]:
  “The Nasdaq closed at a correction which is 10% down from its recent peak.”

• Toby Howell [16:06]:
  “Sweetgreen has been trying to break out of the $18 salad box for years now.”

Attribution:

All quotes and timestamps are accurately attributed to hosts Neal Freyman and Toby Howell as per the transcript provided.