Markets Wrap Up a Shaky Q1 & Elon Musk Sells ‘X’ To... 'xAI'

Summary

Morning Brew Daily Podcast Summary Episode Title: Markets Wrap Up a Shaky Q1 & Elon Musk Sells ‘X’ To... 'xAI'
Release Date: March 31, 2025
Hosts: Neal Freyman and Toby Howell

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Market Overview: A Tumultuous First Quarter

Neal Freyman opens the episode by highlighting the stark weather contrasts between New York City and Boston, symbolizing the unpredictable nature of the markets this quarter. "The widest temperature difference between the two cities on record," he notes at [00:52], drawing a parallel to the economic disparities observed.

Toby Howell recaps the first quarter of 2025, describing it as "wobbly" and "off to a start you'd expect from the Chicago White Sox" ([02:44]). The S&P 500 has recorded its fifth weekly loss in six weeks, while the NASDAQ has entered correction territory, burdened by a struggling AI sector.

A significant point of discussion is the underperformance of the Magnificent Seven—seven mega-cap tech stocks that previously drove the S&P 500. "They have lost nearly $2 trillion in market cap so far in 2025 after driving half the gains for the S&P 500 last year," Freyman explains ([04:22]). This decline has contributed to the US lagging behind European markets, which have surged by nearly 17 percentage points more than the US index, the largest gap on record ([04:22]).

China's market performance emerges as a silver lining. Freyman and Howell discuss how Chinese tech giants like Alibaba, Tencent, and BYD are soaring, with the MSCI China Index up over 30% since August ([05:16]). This marks a departure from China's historical alignment with emerging markets, now outperforming broader emerging market indices by a significant margin ([05:16]).

Amidst rising inflation and stagnant consumer spending, concerns of stagflation—a combination of high inflation and low growth—loom over Wall Street. Howell points out that defensive sectors like healthcare have seen gains, serving as a hedge against economic downturns ([07:48]). The hosts also discuss traditional investment strategies, such as the 60:40 portfolio and gold investments, which have proven resilient. Freyman mentions, "Gold is up 17% this year already for its best start to a year since 1986" ([08:38]).

Elon Musk's Strategic Move: Selling X to xAI

A major highlight of the episode is Elon Musk's sale of his social media company, X, to his artificial intelligence enterprise, xAI. Freyman details the transaction as an "all stock deal" valuing xAI at $80 billion and X at $33 billion, a significant drop from the $44 billion initially invested in Twitter ([08:38]).

Musk states, "this deal cements that X, AI and X's futures are intertwined," emphasizing the integration of data models, compute, distribution, and talent ([08:38]). Observers like Axios' Dan Packman interpret this move as a strategy to stabilize X and leverage proprietary data for competitive advantage in the crowded AI landscape.

Howell adds that this consolidation aligns with Musk's tendency to interlink his businesses, creating synergies across his empire ([10:00]). They speculate that this move could inspire similar partnerships or mergers among smaller AI and social media companies to achieve scale and command higher valuations ([10:58]).

Weekend Highlights: Pardons and Corporate Fraud

In the "Winners of the Weekend" segment, Freyman announces President Trump's controversial pardons of notable white-collar criminals, including Trevor Milton of Nikola and Carlos Watson of Ozzy Media ([12:21]).

Milton was convicted of misleading investors about Nikola's truck capabilities, receiving a four-year prison sentence and a $1 million fine. Watson, guilty of inflating revenue and fabricating business deals, had his 10-year sentence commuted. Upon receiving the pardon, Watson expressed profound gratitude, stating, "I am profoundly grateful to President Trump for correcting this grave injustice" ([12:37]).

Freyman also mentions Charlie Jarvis, a Forbes 30 Under 30 entrepreneur convicted of fraud for inflating customer numbers at fintech firm Frank, which sold to JP Morgan for $175 million. Jarvis awaits her prison sentence, highlighting ongoing challenges with corporate integrity ([14:58]).

Howell provides colorful anecdotes about these fraudsters, such as Milton rolling a truck down a hill to mislead investors and Ozzy Media's CEO impersonating a YouTube executive to secure investments ([13:55]). These stories underscore the audacity of corporate fraud and its repercussions.

Business Innovations and Advertisements

Yankees' New Bat Design: The hosts delve into the New York Yankees' introduction of a novel bat design crafted by MIT physicist Aaron Lenhart. These bats, resembling bowling pins with concentrated mass near the sweet spot, have led to record-breaking home runs ([18:00]). Despite compliance with MLB regulations, not all players, like Aaron Judge, have adopted the new design, raising discussions about performance enhancements and mental effects on players ([19:04], [20:22]).

Advertisements: The episode includes brief promotional segments for Wise Business, offering international financial solutions, and Mito Pure, a supplement aimed at combating the effects of aging ([15:50] to [17:27]).

Duke University vs. HBO's White Lotus: A Legal Battle

A contentious plotline in HBO's White Lotus has brought Duke University into the spotlight. The show features a Duke alumnus engaged in financial crimes, portrayed negatively while wearing Duke apparel. Freyman discusses the legal implications, noting that while Duke officials express concern over trademark usage, the First Amendment likely shields HBO's creative rights ([23:03]).

Howell draws parallels to Peloton's experiences with media portrayals, emphasizing the fine line between brand association and artistic expression ([24:05]). Legal experts suggest that Duke's chances of winning a lawsuit are slim, as artistic works are protected under free speech, provided they don't cause consumer confusion ([23:03]).

Upcoming Week: Tariffs, Jobs Report, TikTok Ban, and March Madness

Tariffs and Trade War: Freyman and Howell discuss the impending announcement of tariffs dubbed Liberation Day by President Trump. The introduction of reciprocal tariffs and a 25% tax on foreign cars is expected to escalate the ongoing trade war, potentially reshaping the global economy ([24:56], [25:42]). The uncertainty surrounding these tariffs has led to consumers rushing to purchase cars before price hikes ([25:42]).

Jobs Report: The upcoming jobs report is critical, with expectations of slowing employment growth from 150,000 in February to 128,000 in March ([26:11]). The report will also assess the impact of Elon Musk's workforce reductions at Doge on the federal job market ([26:40]).

TikTok Ban Extension: The extension of the ban on TikTok looms, with deadlines approaching for a potential sale to a US entity. Failure to secure a deal could result in the app's removal from US app stores, further intensifying US-China trade tensions ([27:03]).

March Madness: The Final Four is set with all number one seeds, a rarity since 2008 ([27:51]). Howell expresses hope for Duke's success, adding a lighthearted note to the intense economic and political discussions ([28:35]).

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Notable Quotes

• Neal Freyman at [04:22]: "The S&P 500 now trails Europe's stocks index by nearly 17 percentage points, the biggest gap ever recorded."
• Toby Howell at [07:48]: "It's almost like returning to a throwback era of investing before the AI bubble."
• Neal Freyman at [08:38]: "Elon Musk just did with parts of his business empire... Like having your own personal tax superhero."
• Toby Howell at [12:21]: "There are certainly some damning anecdotes that will go down in infamy."

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This episode of Morning Brew Daily provided a comprehensive overview of the shaky first quarter markets, strategic business moves by Elon Musk, high-profile pardons of fraudsters, innovative changes in baseball equipment, and ongoing legal battles affecting major brands. Additionally, the hosts offered insights into upcoming economic events that could significantly influence the global landscape.

Transcript

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[Neal Freyman]

Good morning Brew Daily Show. I'm Neal Freyman.

[Toby Howell]

And I'm Toby Howell.

[Neal Freyman]

Today, why Elon Musk sold one of his companies to Elon Musk.

[Toby Howell]

Then we'll recap the wobbly first quarter Wall street has had to kick off the year. It's Monday, March 31st. Let's ride.

[Neal Freyman]

What a difference 200 miles makes. On Saturday, New York City was in full on summer mode as temperatures reached 80 degrees. But just up I95. The weather could not have been any different. On the same day, people living in Boston were hit with freezing rain and temps in the mid-30s. That 45 degree temperature gap between Boston and New York City isn't just good material for small talk. It's history. Meteorologists said it was the widest temperature difference between the two cities on record. Meanwhile, in Connecticut, they couldn't decide which side to take, per usual.

[Toby Howell]

I mean, it was snowing briefly in Boston. Meanwhile, you and me, Neil, we were golfing in short sleeves. The farmer stands were coming out in droves. Really Drives home what they say about Boston, though. New York prices, Chicago weather, Scranton culture.

[Neal Freyman]

Oh, you're doing Boston dirty. Now, a word from our new sponsor, Tax Act. Toby, you look a little pale today. What is going on?

[Toby Howell]

Well, first of all, Neal, it's been winter, so I'm not exactly sunkissed. But also, it's tax season. Needless to say, I'm a little nervous. I am sweating over here.

[Neal Freyman]

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[Toby Howell]

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[Neal Freyman]

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[Toby Howell]

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[Neal Freyman]

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[Toby Howell]

Wait, that's the ex nightmare I've been having.

[Neal Freyman]

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[Toby Howell]

Today is the final trading day of Q1, and Wall Street's 2025 is off to a start you'd expect from the Chicago White Sox. Nothing has quite gone according to plan, with the S&P 500 fresh off recording its fifth weekly loss in the past six weeks as it digested some less than stellar economic news. The tech focused NASDAQ is also officially in correction territory as a mag has labored in Q1, but here are some other storylines as we look to close the chapter on the free first three months of the year. First up, European stocks are suddenly hotter than Portuguese Piri Piri. After years of the US lapping the global pack, the playbook flipped in Q1. Tariff uncertainty weighed on American markets while Europe's promise to boost defense spending sent local stocks flying. The S&P 500 now trails Europe's stocks index by nearly 17 percentage points, the biggest gap ever recorded, according to Bloomberg. One reason why the US is now the global laggard are MVPs. The magnificent seven mega cap stocks are tossing up more brics than Tennessee in the first half. Nvidia is down over 20% and Tesla's dropped more than 30%. In all, they have lost nearly $2 trillion in market cap so far in 2025 after driving half the gains for the S&P 500 last year. Still, there have been hints of good news. Other companies outside the magnificent seven are quietly thriving. One ETF, excluding the big boys is actually up in 2025, albeit just over 1%. So now I think the best way to sum up Q1 was that it was better spent doing anything other than looking at your brokerage account.

[Neal Freyman]

The sports metaphors were strong and that one Toby. So kudos on that. Yeah, let's start by looking internationally because we do focus a lot on the United States, but there are a lot of fireworks. A field I want to start with China actually. So they have their own Magnificent Seven and that includes company big tech companies like Alibaba, Tencent, BYD, which is this EV maker Baidu JD.com they are soaring. The MSCI China index has dropped more than 30% since the end of August. Deepseek was sort of their open air breakthrough moment for for artificial intelligence. And investors have been plowing money into the Chinese stock market, whereas for years it had been kind of stagnant. So there's been a real changing of the guard over there. You mentioned Magnificent Seven stocks have shed $2 trillion in value. Terrific. Ten is maybe another name to know over in China where they're absolutely soaring. So we've seen the script flipped up.

[Toby Howell]

A little bit and a little bit more on China. China, typically in the past has moved in tandem with emerging markets because it was classified as an emerging market for most of the early 2000s. If you look back in history, Chinese shares rose 60 from 2009 to 2010. The broad gates of emerging markets climbed 103% over that same time. Go back to 2016, 2017, China stocks up 50%. Emerging market shares rallied 46%. But now they are outpacing that emerging markets, you know, widespread ETF. The MSCI China Index is up 30% since the end of August, while a gauge of equities in emerging markets is dropped only 7%. So we're finally seeing those two paths depart. And you're right because it is with this air hype, plus the car manufacturing hype from byd. So, yeah, China has been a big winner. Transitioning other to the other part of the world. Europe has also been a massive winner. We spoke about them a lot on the podcast so far. A lot of it is due to, you know, Germany kind of changing its tune on its fiscal policy, saying that we're going to invest more into defense spending. Defense stocks have been the MVP over there. And meanwhile, US Stocks are just having kind of a nightmarish start to the beginning of the year. Tariff threats, you know, inflation sticking around. We had this major inflation reading on Friday that didn't come in so it came in too hot, actually, which is why, you know, suddenly the US is the. I called him the laggard of the global economy because right now we are.

[Neal Freyman]

Let's talk about that report on Friday. It was a true double whammy. So there was this inflation measure that comes out which the Fed is really keyed in on. It shows inflation and then it also shows consumer spending. And we went.02 because inflation came in hotter than expected. It by 0.4% in February. It picked up pace for the fourth straight month. And then you had consumer spending did not go up at all. It went up 0.1%. So you're seeing less consumer spending, higher inflation. That is a recipe for what is become sort of the boogeyman on Wall street right now, which is this word called stagflation, where you have higher inflation and lower growth and it leads to really bad outcomes for the economy and as well as the stock market. One example of this is Goldman Sachs has this basket stocks that do really well in stagflation times. There aren't many, but there are a few, like in defensive sectors like health care, which thrive during recessions. And that is up nearly 20% this year compared to the S&P 505% drop.

[Toby Howell]

I think zooming out here in the early days of this administration, it's definitely paid to hedge your best. The US Stock market in general has been a little troubled. So if you've taken a broader view, looped in some more global stocks, looped in some bond holdings, actually domestic and foreign bond holdings, to that classic 64:40 portfolio construction that a lot of people used to have. That's. It's almost like nothing has happened this year. That, that is basically pretty level on the year so far. So it's almost like returning to a throwback era of investing before, you know, the AI bubble. Before or not bubble, just stocks started ripping. Instead of before the Magnificent Seven, you know, put the entire stock market on its shoulders, there was just this classic portfolio construction of 6040. And it looks like that has been the best way to kind of hedge off against some of these uncertainties that have been gripping the stock market.

[Neal Freyman]

Or if you've, or if you've invested in gold bars and those are lining your metals because gold is up 17% this year already for its best start to a year since 1986. You know that meme where Obama gives gives himself a medal? That's kind of what Elon Musk just did with parts of his business empire. On Friday, the world's richest person said he had sold X, his social media company, to X A I, his artificial intelligence company. According to Musk, the all stock deal values Xi at $80 billion and X at 33 billion, down from the 44 billion he spent on Twitter. So why do this? Isn't this basically just shuffling money around? Musk said that the deal cements that X, AI and X's futures are intertwined. Today, he declared, we officially take the step to combine the data models, compute, distribution and talent. Outside observers such as Axios. Dan Primark also added an important piece of context. This is an attempt to prevent his ex investors from losing money. Remember, at one point, X's value had plunged 70% from when Musk bought it. And while business has rebounded it remains on shaky financial footing. Toby, while this was a surprising announcement, the writing had been on the wall since X and XI were sharing loads of resources. And Elon Musk has pulled off something similar among his various businesses. What do you think this link up says about his ambitions?

[Toby Howell]

Well, I think one, you're totally right that it just offers this resolution for, you know, ex backers who have probably been nervously looking at that announcement. You know, it was, it was discounted heavily just a few months ago because of just this exodus of advertising revenue. Now those backers are basically made whole again at evaluation. Very similar to what Elon Musk originally acquired Twitter for back in 2022. But also I think this has a lot to do with giving Grok xi's, you know, LLM a pretty unfair and unique advantage. Because remember, Grok has been trained on this. Huge amounts of data called from X. All those posts go into feeding Xi's Grok chat bot. And now they have full control over that data set. They can control how they use it, but also they can control what other companies get to train themselves on that data. So it makes a lot of sense giving this, this fountain of proprietary data that they can now use to try to separate from the pack of this very crowded space of lms.

[Neal Freyman]

Which is why some analysts look at this deal and said, hey, that was pretty smart. I could see smaller players in AI and other smaller social media players doing similar things. Maybe they don't have the same owner, but they might link up in order to gain scale and command higher valuations. I mean, the valuation for X, $80 billion, that's more than the combined market values of Snap, Pinterest and Reddit. Right now Google pays Reddit to train its, to train its large language model on Reddit data. Well, what if they were the same company? They would also have training data and they would have distrib like Grok has. Grok is a large language model that any time you log into to Twitter or X, you can see it being used. So it might spur more partnerships, maybe even some mergers between smaller players in AI like Anthropic or Perplexity, and smaller players in social media like Snap, Pinterest or Reddit.

[Toby Howell]

And this is just straight out of the Elon Musk playbook. He loves combining his various companies, not just, you know, financially like he just did, but also he loves using employees to work across multiple companies. So this is not the first time that we've seen basically him treat his empire, for lack of a better word, as a single entity where everything is shared across each different company. So this tie up we probably should have seen coming. It makes sense on just so many levels. So now it finally happened.

[Neal Freyman]

And in 2020 and 2016, Elon Musk did something similar when he used Tesla stock to buy his other company, SolarCity. Okay, let's head to our winners of the weekend, the segment where Toby and I picked two gangs whose Sunday morning eggs were sunny side up. I won the pre show extreme ironing contest, so I get to go first. And my winner is Fraudsters, because some of the most notorious white collar criminals of the past several years are now free men. On Friday, President Trump issued a flurry of pardons to business leaders who were found guilty of fraud. The first pardon went out to Trevor Milton, the founder of electric truck maker Nikola, which is now bankrupt. Milton was sentenced to four years in prison and fined $1 million after he was convicted by a jury of fraud for misleading investors about the capabilities of Nikola's trucks, pumping up the stock with unfounded claims. When asked about the pardon, Trump said it had come highly recommended by many people he knew. Trump also granted clemency to Carlos Watson, the media executive who founded Ozzy Media. When Watson heard the news, he was literally on his way to report to prison to serve a 10 year sentence for fraud. In July, Wa was found guilty of fraud for inflating revenue figures when courting investors and lying about having completed business deals that were either made up or not finalized. During the sentencing, the judge told Watson the quantum of dishonesty in this case was exceptional. Watson maintained his innocence throughout and on Friday said, I am profoundly grateful to President Trump for correcting this grave injustice. Toby, big weekend in the world of fraud.

[Toby Howell]

Yeah. There are certainly some damning anecdotes that will go down in infamy from two of those cases that you just mentioned. I mean, Trevor Milton, the founder of Nikola, will go down the Mount Rushmore of fraudsters because at one point he was rolling one of their trucks down a hill and passing it off as if it was operating under its own power source. That anecdote alone is just an insane, you know, business lore story right there that ended up with him. Yeah. Being convicted of fraud. And then also, do not sleep on what happened at Aussie media because that is a crazy story. Aussie CEO at the time, Sameer Rao, allegedly hopped on a call with Goldman bankers as they were trying to court this big investment from them and pretended to be a YouTube executive. He used a disguise voice to hype up Ozzy's you know, partnership and performance prospect. They were trying to get $40 million out of Goldman. So these are two just insane fraud business stories that now both of them are kind of walking free. But just taking a trip down memory lane to reacquaint myself with these two stories. It was truly a wild time in business media.

[Neal Freyman]

And while those two guys were walking free on Friday, another fraudster is awaiting her prison sentence because Charlie Jarvis, remember her? She's that Forbes 30 under 30 who founded this fintech Frank, which sold to JP Morgan for $175 million, was convicted of fraud for, quote, falsely and dramatically inflating the number of the company customers. After JP Morgan bought Frank, they had a ton of buyer's remorse because they sent out this email to the supposed list of more than 4 million frank customers, only to return just a few small percentage percentages of those emails. Turns out that Jarvis and and one of the other executives at Frank had been artificially inflating their email list. So now Jarvis was convicted by a jury on Friday and she awaits a prison sentence later this summer.

[Toby Howell]

Up next, we have my winner of the weekend. Taking your business international can feel like sailing through a sea of red tape. Regulations and unpredictability is attracting global business worth the global hassle.

[Neal Freyman]

Wise Business can help. Your Wise account has everything you need to operate your global business. With Wise Business, you can process payments, get paid, and manage your money internationally.

[Toby Howell]

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[Neal Freyman]

Setting up your account is super easy, and it takes just a few seconds to make payments in over 40 different currencies.

[Toby Howell]

To learn more about how you can use Wise Business to save time, money and stress, visit wise.com business. That's wisec.com business. Do you ever feel like you can feel yourself getting older?

[Neal Freyman]

Literally all the time. Just ask my lower back.

[Toby Howell]

Yeah, my knee is saying the exact same thing.

[Neal Freyman]

Well, no one's found a way to stop aging yet, but Timeline has created a supplement that can change the way aging feels, helping your body to bounce back faster by giving your cells a refresh.

[Toby Howell]

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[Neal Freyman]

And it's super easy to add to your routine. It just takes two soft gels a day to reboot your cells from the inside out.

[Toby Howell]

Want to feel aging differently? Get 10 off your first order of Mitrepure at timeline.com Morning Brew Daily that's T I M E L-I-N-E.com Morning Brew Daily My winner of the weekend is hitting dingers because with a new bat design the New York Yankees cooked up for this season, it's looking like you're going to be seeing a lot more home runs. On Saturday, the Bronx Bombers hit a team record nine home runs against the poor Milwaukee brewers, then followed up that performance with a four home run game the next day. Eagle eyed fans were quick to note that the bats that some players were using looked a little different. They were shaped almost like bowling pins, with more mass concentrated in the middle near the sweet spot rather than spread evenly throughout the barrel. This design was not the result of an affinity for torpedoes, but rather the work of an MIT physicist on the payroll named Aaron Lenhart. Despite his lofty credentials, his explanation for the design tweak was not exactly rocket science. Really, it's just about making the bat as heavy and as fat as possible in the area where you're trying to do damage on the baseball, he told the Athletic. In other words, make fat bat hit ball hard. Now I know what you're thinking Yankees Controversial Performance Edge Is this cheating? The answer is no. The bats appear to comply with MLB regulations. League rules specify the bats must be no longer than 42 inches, no thicker than 2.61 inches and made of solid wood. And these Yankee bats violate none of the above. Neil, as a Red Sox fan, how do you feel about these new super bats?

[Neal Freyman]

Why aren't we using them? I mean, if the rule states that they just have to be a certain dimension and made of a solid piece of wood, but it is kind of mind boggling that the folks in in Major League Baseball around the teams haven't figured this out sooner. And we've been using the same design bat for decades, but I guess that's just how disruption works. You kind of think insularly and not outside the box like this guy does. Lenhart and it's a very fascinating story that shows how analytics has really infiltrated the game of baseball in sports more broadly. Last year, Aaron Judge, the star of the Yankees, was complaining that the analytics department was the not speaking to the players in a simple enough fashion. So the analytics department, who are all these, you know, data nerds, are, you know Finding these insights, they're reviewing tape, they're, you know, running computer programs. But when they would try to translate those insights to the players, it wasn't a good communication system. So what the Yankees did was hire this guy at Lenhart who is this former MIT physicist who taught physics at Michigan for seven years. And, you know, he's on that side of the ball, but he's also a former baseball coach as well. So he's the perfect marriage between what these two emerging trends in the game. He can bring things together. And he also had this remarkable design for a bat that is probably going to be the hottest product since the Stanley Cup.

[Toby Howell]

What is funny, though, is that these bats aren't actually universally adapted by the Yankees at all. Aaron Judge, who you just mentioned, for instance, isn't making the switch. He basically said, have you look at what I've done over the past few years? Why would I fix what ain't broke? And he's been hitting the most home runs on the Yankees. So part of it is also maybe just a placebo effect. Volpe, another player on the Yankees, said, just looking. A lot of it is just looking out at your bat and you see how big the barrel it is. It's exciting. I think any 0.001% mentally, that could give you confidence help. So maybe it is just as much of a mental placebo effect as it is actually boosting performance. But I do think you're right when people this whole weekend, people on social media were saying, like, how did no one think about this? Like, put more mass where you hit the ball. Like, it seems so simple. But at the same time, it did take, you know, an M by N T physicist to think outside the box and actually make this switch. Moving on. Fans of the HBO series White Lotus have been treated to a buffet of uncomfortable moments this season, ranging from funny to completely unwatchable while in the vicinity of your immediate family. But officials from one particular Southern university are not enjoying the highly rated third season at all, and that is Duke. Duke has played a prominent supporting role so far, one that doesn't portray the Blue Devils in the best light. One of the show's main characters, Timothy Ratliff, who is played by Jason Isaacs, AKA Lucius Malfoy, is a businessman and a Duke alumni who is on vacay in Thailand. Now, pause here if you haven't seen the show yet, because spoilers ahead. Seriously, you've had your chance. All right? If you're caught up, you know that Ratliff is the subject of an investigation for some financial crimes and his son Saxon, who is also a Duke alum, has an interesting encounter with his brother. The legal situation causes the elder Ratliff to spiral. He steals his wife's anti anxiety meds and also gets his hands on a resort security cards gun and one scene he has the gun to his head while very conspicuously wearing a Duke Blue Devil's shirt, leading to some observations around the Internet as to how useful that particular screen grab could be if Duke loses in March Madness. For fans of the show, it's been an entertaining and memeable plot point, but for Duke officials, the show has gone too far. Frank Tramble, a VP of Comms at Duke, said in the email that the show, quote, not only uses our brand without permission, but in our view, uses it on imagery that is troubling, does not reflect our values or who we are, and simply goes too far. And now this interesting IP legal battle has emerged. Is HBO legally allowed to use the Duke name and brand in such unflattering ways? How far do trademark protections extend? And most importantly, Neil, will Duke win the national championship? Because I really need them to for my bracket.

[Neal Freyman]

They'll probably win the national championship, but they probably won't win any legal case against HBO or the White Lotus because under the First Amendment, artists have really strong protections to use well known trademarks for artistic and expressive purposes. Just think of Saturday Night Live. Jeopardy. Probably does not like that they use celebrity Jeopardy to make raunchy jokes for decades. But they can because this is a free country. We have the First Amendment and you can use trademarks in your artistic work. What you can't use a trademark for is to do people into thinking you are Duke when you're not Duke. So say you started a college and then you called it Duke University and had similar branding, obviously has the same name. That probably wouldn't fly under trademark law, but when you're making art like Mike White does with White Lotus, you have a wide latitude. So legal experts chimed in on this case and said that, you know, Duke as a business doesn't really have any case here to pursue legal action, but they can complain.

[Toby Howell]

I mean, this is not the first time this has happened too. I mean, you know, the adage is there's no such thing as bad publicity. But in fact, a lot of brands have kind of gone through the same thing that Duke is going through right now. The most recent one that is top of mind is Peloton, who had to do a lot of damage control after a reboot of Sex and the city had someone exercising on a peloton die. And I'll leave it at that because again, spoilers. The company said that at the time, yes, they approved their usage of peloton bike in the show, but they didn't know exactly how it was used and tried to walk back their association with it. I think a similar thing is happening with Duke right now, but they might have strengthened affect themselves a little bit where if they had just not responded or not acknowledged it at all, we probably wouldn't be talking about it right now. So you, yes, you understand the desire to disassociate yourself from this. But on the other hand, they're also drawing a lot of attention to it.

[Neal Freyman]

Okay, it's Monday, so here are the major events you need to know about in the week ahead. Everyone is watching what tariffs will be announced on Wednesday, which President Trump has dubbed Liberation Day. Depending on the size and extent of the tariffs, it could lead to a reorganization of the global economy economy we haven't seen in decades. On Wednesday, Trump has vowed to place reciprocal tariffs on all countries that tax imports from the United States, while the next day 25% tariffs on foreign cars will go into effect. We should also expect countries to announce retaliatory tariffs against the US that day, sending this trade war into nuclear territory. In a sign of just how impactful these tariffs will be, some auto dealers across the country were packed this weekend as Americans scrambled to buy cars before prices rise again.

[Toby Howell]

Nothing is certain until it happens and some of these orders are reversed as soon as they are given. But this is a risky trade war. As we've spoken about. Stocks don't like it every day, American budgets don't like it, businesses don't like it. But what we'll see here is if A, if these tariffs happen, B, if they are like broccoli bad in the moment but good for you long term, or C, maybe they're like moldy broccoli bad in the moment and bad long term. So that's kind of the options that are branching out in front of us ahead of this quote, unquote liberation.

[Neal Freyman]

Yeah, 48 hours. We still have have really no idea what's about to come down the pipeline. But really, the global economy hangs in the balance even as tariffs dominate Wall street chatter. Investors will face another big test on Friday with the jobs report. Economists estimate that employment growth is expected to have slowed to 128,000 jobs added in March from about 150k in February. And special attention will be paid to whether Elon Musk's sweeping Doge layoffs of the federal workforce will show up in the daily data.

[Toby Howell]

Yeah, the jobs, you know, market has been one of these shining lights. It's been steady. It's withstood a lot of pressure from different parts of the economy. This is truly a make or break it moment. Not make or Drake it, but we'll actually see if Doge's effects are going to show up in the jobs report because it has been steady. And if that, you know, steady drumbeat starts to falter a little bit, that's when things get a little bit more dicey.

[Neal Freyman]

And remember the tick tock ban. Well, time to start thinking about it again, because on Saturday, Trump's extension that delayed a U.S. ban on TikTok Tok will expire, meaning the Chinese app could leave app stores once again. As it did in January. Trump is trying to get Beijing to greenlight a sale to a US Entity by relaxing tariffs. But if that doesn't happen by Saturday, which doesn't seem to be in the cards, Trump said he'll extend the deadline again.

[Toby Howell]

Yeah, I think that little China tidbit is something that's very interesting to look like because Trump has acknowledged that this deal will only get done with China's approval. So maybe a little reduction in tariffs is floating down the pipeline. So it is funny how TikTok has suddenly finally become part of this trade war and has become part of, you know, this global reorganization of trade. So every time you're swiping through a video, just know that you could be influencing the direction of the global economy.

[Neal Freyman]

Can it still be March Madness? If it takes place in April, sure, why not? The men's Final Four is set and it's all number one seeds. Florida will play Auburn and Duke will play Houston on Saturday. The winners will face off in the championship game a week from today. And then on the women's bracket, the Final Four will be solidified today. South Carolina and UCLA have already punched their ticket to the Final Four.

[Toby Howell]

On the women's side, too, I think you can't sleep on UConn. Paige Becker's dropping 40 the other day. Everyone forgot how good she was in the Caitlin Clark Madness, but you know, she is absolutely her. As for the men's, I can confidently say that a number one seed is taking home the crowd this year.

[Neal Freyman]

And this is the first time that it's been all number one seeds in the final four season since 2008.

[Toby Howell]

And nothing bad happened in 2008. So I'm sure that's not an omen whatsoever.

[Neal Freyman]

All right, let's wrap it up there. Thank you for starting your morning with us and have a wonderful start to the week. For any questions, comments, or feedback, send an email to Morning Brew daily@morning broad.com let's roll the credits. Emily Milian is our executive producer. Raymond Liu is our producer. Olivia Graham and Olivia Lake are our associate producers. Eugenia Ogu is our technical director. Scoopstar D. Harris is on audio hair and makeup. We need a torpedo mic stat. Devin Emery is our chief content officer, and our show is a production of Morning Brew.

[Toby Howell]

Great show today, Neil. Let's run it back tomorrow.