
Bromance over? & long-awaited Switch 2 is here
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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 Elon Musk and Donald Trump broke up with everyone watching what it means for Tesla and Space X.
Toby Howell
Then Nintendo Switch 2 is already selling like hotcakes. But can it live up to its predecessors Legacy? It's Friday, June 6th. Let's ride.
Neal Freyman
Happy Friday everyone. Toby that was jaw dropping yesterday. It's been a while since we had this amount of chatter, jokes, memes, I told you so's about one big news story. But it makes sense because the drama does strike to the heart of unchecked money and power in this country. But now the big question is where do we possibly go from here after the dust has settled? It's anybody's guess.
Toby Howell
I know. I too cannot believe that Aaron Rodgers is going to the Pittsburgh Steelers. Crazy day indeed. And okay, I guess we'll talk about Elon and Trump too. But before that, a word from our sponsor, LinkedIn Ads. Neil, some people don't know this, but you were actually the person that originally hired me at Morning Brew.
Neal Freyman
I did saw the potential early and I knew that job description would attract the right sort of people who knew.
Toby Howell
That one day submitting that application would lead to this wild asleep schedule. But yes, part of the reason why I'm sitting here today is because of your ability to target well, Neil. Something that LinkedIn ads can provide to B2B marketers.
Neal Freyman
It lets you target the professionals who actually matter to your business and want to buy your product. Job title, industry company size. You get precise tools to target precisely the people you want.
Toby Howell
Plus their network includes over 1 billion professionals and 130 million decision makers. So there's a lot of potential Toby's out there.
Neal Freyman
Stop leaving your B2B marketing up to chance. Instead go get a $100 credit to try out LinkedIn ad. Go to LinkedIn.com/mbd to get started. That's LinkedIn.com/mbd terms and conditions apply.
Toby Howell
Burr and Hamilton, Zuckerberg and Savin, Skywalker and Kenobi. No bromances last forever. And it looks like another one has bitten the dust. After President Trump and Elon Musk had a massive falling out yesterday. Tensions between the two had been simmering for days now as Elon bashed Trump's prize tax and spending bill as a disgusting abomination. The that balloon the deficit and gutted EV incentives. That didn't sit well with Trump, who hit back during a live Oval Office presser saying he was very disappointed in Musk, accusing him of flipping on the bill he supposedly helped shape. Trump also said, hey, you want to know where we could cut billions and billions of dollars? The federal subsidies and contracts the government has with your companies. Elon of course, Musk owns a massive social media platform, so. So he took things very public, claiming he never saw the bill, accused Trump of ingratitude, then dropped a bombshell. Trump hadn't posted the Epstein files because he's in them. He also threatened to halt development of the Dragon spacecraft used by NASA, though he later walked that back. While all this was going down, so was Tesla's stock price, which finished the day losing 15%, shaving over $150 billion off its market cap, its biggest single day loss ever. Neil Many forecasted this day would come, but the decoupling of Musk and Trump was perhaps even more explosive than expected, with billions of dollars of market cap and government credits caught in the crossfire.
Neal Freyman
Yeah, even if you predicted this breakup, watching it happen as spectacularly as it did was something to behold. I mean, here are the two, the world's two most powerful men, along with maybe Jerome Powell and Xi Jinping, with significant ability to inflict physical financial pain on each other. We know that Elon Musk bankrolled Trump's presidency, presidency bid with $250 million, the biggest political donor out there. And then Trump's threat against Musk about these government contracts and just the overall looming threats of what Trump could possibly do to Musk, should he pursue those things as president, was a major drag on Tesla's stock price, down over 14%. The biggest one day wipeout in its history. There are many levers that Trump could pull to inflict PA on Musk. I mean, Musk, both his companies or he has many companies. These two biggest companies, Tesla and Space X, are very much ingrained with the federal government. Space X is a huge contractor and Tesla gets a lot of its sales through things like the EV tax credit which this bill would remove.
Toby Howell
Yeah, let's talk precisely dollar amounts of how much these companies benefit from US Government contracts and subsidies. The Washington Post has put the figure at 30 $38 billion. Space X's own President and CEO Gwen Shotwell, estimated the company alone's benefits from $22 billion in federal spending. Reuters said the figures classified due to the relationship between Musk and the federal government. Tesla, meanwhile, has benefited from around $11 billion in total regulatory credits, which is again the kind of the issue that Trump has spoken to that Elon is most mad about is the fact that this bill would strip away some of those. So everywhere you look at Trump and Elon in the federal government and Tesla and SpaceX are all intertwined, which is why this made it was such a messy day yesterday because of the billions of dollars that is on the line.
Neal Freyman
And Musk also has some cards to play as well. You mentioned that he threatened to stop development or the use the government's use of the Dragon spacecraft. Right now that is the only way that US Cargo and astronauts can get to the International Space Station. So you can he was basically doing, you can't fire me, I quit. He later backed that down and there were other signs that maybe there was some thawing out between these two guys and we'll see what happens because there is so much at stake. Bill Ackman, who is his head fund manager, tweeted, hey guys, please calm down. Like you need to buddy up again because there's so these things are bigger than you. And Musk replied, you know what, maybe you're right. I'm going to take a chill pill. Tesla Stock is up about 5% this morning, so we're going to see how this plays out. But truly a wild day yesterday and I don't think we've seen the last of these two guys talking to each other. Yesterday also felt like a throwback to a different era where people lined up at stores for as long as 20 hours to get their hands on a shiny new electronics gadget. That gadget is the Nintendo Switch 2, and it was the start of the biggest console release of all time. Retailers across the world opened at midnight so that fans could buy the new Switch, but many were left empty handed when stores ran out of inventory, especially in Nintendo's home base of Japan, where the hype registered at Shohei Ohtani levels. And that's because the Switch 2 represents a bridge between the past and future of gaming. The OG Switch, released in 2017, was a stunningly successful hardware innovation, allowing gamers to play on their screens at home in addition to taking it on the go with them. Over its eight years in service, the Switch sold more than 152 million units to become the third best selling video game console in history. Nintendo has reaped the rewards with its stock price nearly quintupling since the Switch's release. So an almost impossibly high bar has been set for the Switch 2. But Nintendo is ready to vault over it by taking what people loved about the original console and souping it up. The Switch 2 is more powerful, has a bigger screen, and arrives with more modern controllers than its predecessor. It also costs way more at $450, up 50% from the $300 price tag for the first version so far, Toby, it seem like people are more than willing to pay up.
Toby Howell
Yeah, the Switch 2 is looking like it's off to a flying start. Though I do have to say I feel bad for Nintendo because you go back to April 2, that was when the Switch 2 was unveiled. That was the same day that Trump unveiled these global tariffs on Liberation Day. What happens on Switch to release day June 5? The Trump and Elon beef explodes, overshadowing it once more. So Nintendo has just this bad luck when it comes to interacting with Trump's various things that he kind of dominates headlines with. So I think they'll do okay though because Nintendo really has a different strategy with this release than past console releases. They've had a bit of unluck with their follow up consoles. Like if you go back to the Wii, the Wii U after it was just an absolute flop. It sold way less than the original WWII. It sold 13% of the WWII sales. And then you even go back further. The GameCube didn't follow up the Nintendo 64 very well. 34% decline compared to its predecessor. So they have this much more conservative design push. It very much is almost like a Switch Pro that they're releasing where they just souped up the processing, added a few gadgets and gizmos here and there. But the main core function is pretty much the same as the Switch one. And so analysts are actually pretty bullish on that because they're just going off what they know works and, and just making it a little bit better, which will probably not lead to that second console jinx that they've been plagued by over their history.
Neal Freyman
And one reason why people might spring for the Switch to when you can get your hands on it is the game that is being released alongside it, which is Mario Kart World, which is Mario Kart. But you can kind of go anywhere you want. It's more of an open world system, which a lot of people were talking about and getting super excited about. The one thing about Mario Kart World is, is it is $80. So we've kind of hit the $80 threshold here with video games that has never been breached before. So you buy the much more expensive console, a much more expensive game, you're seeing a little bit of significant inflation here in the video game industry. Nintendo thinks it has a differentiated product, hardware, product, but also in terms of its games, it's making things that people absolutely love. And that's really what was the reason for the Switch's success, was Nintendo's exclusive games that it made for the this particular system that people were just so obsessed with. They love Mario.
Toby Howell
And then one final reason to be even more bullish about the Nintendo Switch is that a lot of gamers are playing fewer titles every single year, and they're actually playing more older titles. For instance, in 2024, 45% of gamers on PlayStation platforms were playing games that were more than six years old. That was up from just 25% a few years ago. Totally different story for Nintendo though. They do shell out for these $80 new Mario Kart games, but because they have this deep well of IP that people love. I mean, you know all the characters in the Nintendo universe. And it does look like they can rely on these new games to drive sales, whereas other consoles can't because they don't develop the IP in house. So just one more reason why you should be potentially bullish on Nintendo, specifically the Switch 2. Because they have just this great archive of games that constantly updated and attract new fans, even to this day.
Neal Freyman
It's Friday and you all know what that means. Stock of the week, Dog of the week, the segment where Toby and I pick one stock that's dipping out early for a summer Friday and another that has a 4pm meeting. I won the pre show cherry pit spitting contest, but did not manage to break the world record of 93ft 6 inches. Either way, I get to go first. And my stock of the week is Circle because it just elicited a lot of ooze with its public listing. Yesterday, the stablecoin issuer popped 168% in its IPO, the best one day pop for a large IPO since 2021. It shows that investors are foaming at the mouth over the potential of stablecoins to revolutionize financial transactions. A stablecoin is a cryptocurrency that's supposed to be well stabilized by being pegged to another asset, typically the US dollar or Treasuries. That's the case with Circle stablecoin usdc, which is pegged to the dollar and has a market cap of about $62 billion, good for the second biggest stablecoin in the world after Tether. There's loads of excitement over the promise of stablecoins to make things like remittances business to business payments and e commerce faster and cheaper. And they're already huge for trading on crypto exchanges. And I mean huge. The total value transacted through stablecoins was higher than visa in 2024. That's according to estimates from Ark Invest. With legislation regulating stablecoins advancing through Congress, there appears to be growing conviction that the stablecoin economy is about to crash the party with Circle as one of its biggest players.
Toby Howell
Yeah, I think that was the reason we saw so much enthusiasm for this is that stablecoins traditionally were just used crypto people. It just, it's kind of the lubricant that allows, you know, your, you to interact in the crypto ecosystem. But it was very crypto focused for a long time. But this idea that banks and other e commerce companies are going to get in on the party is why there's so much enthusiasm behind it. Because if Congress does go through and pass legislation that regulates these things, then it could be a new era of like the financial system that crypto people have talked about for a long time where it breaks free from just a specific niche of the financial world and just starts dominating the entire financial world writ large. So that's just been a massive government or massive tailwind. The other thing that's a tailwind as well is that some people argue that using stablecoins pegged the US dollar keeps the US dollar strong because most are backed by US government bonds. So that's like another aspect of this that if you are concerned about, you know, the US dollar losing its hegemony over the global financial system, Circle could come along and re cemented as one of those, as you know, the de facto currency of the world.
Neal Freyman
And meanwhile, after a long time of just kind of being frozen, the, the IPO market is heating up a little bit and these companies that are listing this spring are doing really well. We haven't talked about core, we've been a while, but that company is on a very much a hot streak. Circle popped 168% and overall shares of companies that went public in the US this year are up 15% on average from their IPO prices. That's through Tuesday. Compare that to the S&P 501.5% gain. So if you're getting in on these one day IPOs, you're doing pretty well in your portfolio.
Toby Howell
All right, don't go anywhere. Dog of the Week is coming up right after this.
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
Our dog of the week is Tick Tock. Try on hauls because fast fashion giants Shen and T Mo have seen their businesses crushed by tariffs and the closure of the Day Minimis loophole that allowed low cost goods to enter the US Tariff free. The numbers for these once high flying companies are uglier than some of their clothes right now. Tamu's US daily active users dropped 52% in May compared to March while she fell 25% according to sensor Tower data. Both apps have plummeted down the app store rankings. Taemu is now mired in the mid-1100s after consistently being ranked in the top three last year. Part of that fall is due to an advertising pullback in May. If you felt like you hardly saw some TAMU ads anymore, you were right. Its ad spend fell 95% year over year and she and wasn't far behind with a 70% reduction in spending targeting US users Neal if you could hand pick two companies who would be most affected by Trump's attempt to remake global trade. Asia based fast fashion giants would be the top two picks. Certainly earned the title of Dogs of the Week and maybe even dogs of the year so far.
Neal Freyman
Analysts say that the 50% tariff is effectively the rate where these companies stop being competitive with other e commerce firms and their low prices. That competitive edge kind of goes away right now. Now they're being hit with a 54% effective tariff rate on bringing those products into the United States. So you can see they're raising prices and it is the US market has just kind of been closed off to them and they built, they spent years building up these operations to drop ship parcels less than $800 worth to the United States under this zero tariff regime. Now they're getting hit with 54% tariffs and they're saying you're seeing from the ad spend numbers, they're just saying I don't think we can play in this market anymore. It's just not a competitive thing for us.
Toby Howell
Yeah, luckily for T whose parent company holdings they their non US user base is very robust. They said that 90% of the company's 405 million active users come from non US users. So they are starting to retarget some of their efforts towards Europe for instance, shifting a lot of ad spend over to that market. But Europe is a difficult market to enter as well because they have a lot of legislation of regulation. They have their own sort of like de minimis loophole as well with an even lower threshold than the $800 in the US so Europe is not a one to one replacement for for the United States. But that is where they're kind of putting their ad spend right now because they need to try to attract new business in other markets.
Neal Freyman
These guys hate selling in Europe. Here's a quote from one guy who sells smoke detectors. I realized I entered a hell mode. I now deeply understand why everyone loves starting their overseas business in the US Market because to sell in Europe, he had to register for a value added tax, which they have in each individual country, a wide variety of plugs, and then translate his instruction manuals into at least five different languages. So for a business owner, that does sound like entering hell mode. So there's not so many amazing options now that they're being priced out of the US Market. They're trying Europe, so as you can see, there's a lot of red tape to wade through. Next up, the Tony Awards are Sunday night, and there's nothing miserable about the business of Broadway. This season, Broadway shows grossed more money than any other in history, bringing in $1.89 billion from May 202024 to May 2025, topping the previous record of 1.83 billion in 2019, the last full season before COVID shut down theaters. Why is Broadway more popular than ever? Hollywood stars don't hurt Good Night and Good Luck, which stars Toby's doppelganger George Clooney, repeatedly set new records for the highest weekly gross for a play, at its peak, bringing in $4.2 million at an average ticket price of $337. Other A listers on Broadway this spring included Denzel Washington, Jake Gyllenhaal, Bob Od Her, Kieran Culkin and Sarah Snook. But there may be another reason Broadway is getting its groove back. It's winning over the use. Gen Z has been a force this theater season, heading in droves to plays like John Proctor Is the Villain, starring Sadie Sink and a Brooklyn Rave retelling of Romeo and Juliet with music by Jack Antonoff that speaks directly to young people's experiences and talks their language to be a well deserved curtain call for Broadway Sunday night.
Toby Howell
Yeah, they're going after the young people and I think part of it is that they one got a lot of famous actors and young people like famous actors. But also they've been incorporating more pop music into plays. I mean, John Proctor is the villain, actually needed the showrunner of that said, we need Lord's green light to, you know, land this final act. And Lord said, sure, go use it. And then also you look at Romeo and Juliet retelling. Jack got involved in that too. Jack and off is involved in everything these days, it seems like. So all these shows share similar DNA. They have a focus on pop music, they have Hollywood stars coming in with established fan bases, and they're also just retelling stories of the complexity of young adulthood, which is just pretty much a timeless institution at this point, or timeless storytelling at this point. So I think you are seeing Broadway hitting all the right notes right now.
Neal Freyman
I mean, the numbers for Romeo and Juliet, specifically about, you know, whether you go into these theaters and the population you're seeing. Typically you go into a theater like, oh, you know, this is not necessarily the younger generation. But for Romeo and Juliet, which stars Kit Connor and Rachel Ziegler, 14% of ticket purchasers were aged 18 to 24. That's compared to the industry average of 3%. This is the youngest ticket buying audience ever recorded on Broadway. So there is certainly a Gen Z upswell leading Broadway to record heights this season.
Toby Howell
Yeah, it does feel a little counterintuitive to market pricey Broadway tickets to the younger people, but you can, you can't survive if you don't attract a younger generation. So it is like a very savvy marketing opportunity. If you look at Romeo and Juliet tickets, they gave out cheaper tickets to students to bring them in. So that's part of the reason why you saw just a record young crowd, even though it's not that big of a percentage of the audience. Actually that's the record size. It is still a lot of, you know, older, wealthier people going to Broadway, but at least they're making strides in this department.
Neal Freyman
And one more thing that should get maybe some people excited about Broadway is Tom Felton, who played Draco Malfoy in the Harry Potter films, is going to come back in that particular role with Harry Potter and the Cursed Child on Broadway starting in November. So if you are a Malfoy fan, you can see him as Malfoy in November. Let's sprint to the finish with some final headlines. The robot revolution is coming to your doorstep. Literally. Amazon is reportedly testing out human like robots to serve as delivery workers and spring out of its vans to drop off your packages. To get the bots ready for the mean streets of suburbia, the company has built a top secret humanoid park in San Francisco, which I'm imagining as an American Ninja warrior style obstacle course intended to test the humanoids for the range of situations they'd face going from van to porch. Toby, if these humanoids ever get deployed, it could lead to a lot of delivery workers losing their jobs and a lot of dogs being very, very confused.
Toby Howell
How confusing would that be? Like, hey, I'm barking at this thing. It's not giving me anything in return. But yes, this last mile delivery has always been something Amazon has been trying to solve. And they kind of envision this as there is a human delivery driver potentially driving a Rivian van and then these robots jump out of the back and just carry it to the porch, which at the moment doesn't seem quicker than the human doing it. But they are testing it. They are thinking theoretically they could speed up drop off times by visiting one address and just fanning some robots out and then having them come back. It's something that Amazon is working on in a variety of different ways as well. Remember, they've been giving test flight permission to try to fly drones and drop them off last mile as well. So clearly something that they've been interested in solving for a long time. But yes, scary robots jumping out of the back of vehicles is going to be a sight to behold in suburban America if they can make it work. Finally, if you were in the market for a new purse, consider going to Paris next month to see if you can stack the original Hermes Birkin bag which is up for auction. This bag, which was inspired by the actor and singer Jane Birkin, is the first version of the luxury staple that has since spawned into an empire. Birkin bags can range in price from $10,000 to over 2 million and occupy the arms of everyone from the Kardashian to Simone Biles. The original bag was created specifically for Birkin, an on the go actor and singer who in 1984 told the chair of Hermes that she needed a bag to accommodate her lifestyle. She wanted a purse half the size of my suitcase, birkin said, and then sketched out what she was looking for on the back of a sick bag you find on airplanes. That sketch ended up as a one of a kind prototype that is as tall as it is deep and wide with the crossbody strap and of course the initials JB on the front. Neal Most of those features never made it into other Birkin bags, but it is fashion history that is up for sale right now.
Neal Freyman
The origin story of the original Birkin bag and how this was created is actually fascinating meetings. She this actress was on an Air France flight, she from London to Paris. She happened to get upgraded to first class. Who does she sit next to? Is the Hermes CEO. They get to talking. She all of the stuff is spilling out of her bag. She can't keep it in her bag and she, she starts complaining like can you design me back? So they work together, put their heads together. She sketches what she wants on that vomit bag in the airplane and the rest is history. We don't know how much this is going to go for. They're staying very tight lipped about it. But they did say we foresee it as being as unique as the Princess Diana jumper or a worn jersey from the NBA. So a piece of memorabilia that is truly historic in value. And, you know, besides its monetary, you know, besides what it fetches monetarily, it is symbolic of what it means to be wealthy in the world right now.
Toby Howell
Yeah, one of these days I'll get a Birkin. Probably not. You can't even go and buy one even if you walked into an Hermes store. So you can't just say, I would like a Birkin. I have $1 million here. They won't even give it to you. You have to create a rapport and a relationship with a sales associate, which usually involves spending a lot of money first. And then do you get the privilege to buy a Birkin bag and shell out hundreds of thousands of dollars? They're also like, appreciating assets, which is something I'm often told by my own girlfriend and saying like, hey, look at the price of this Birkin bag. It's outperforming the S&P 500 over this era of time. So something to think about if you are in the market for a new handbag bag, maybe getting an appreciated asset like a Birkin bag.
Neal Freyman
All right, that is all the time we have. Thanks so much for starting your morning with us. Have a wonderful Friday and an even better weekend. If you have any thoughts on today's episode, send an email with questions, comments, or feedback to Morning Brew Daily at Morning Broadcom. Let's roll the credits. Emily Milian is our executive producer. Raymond Lu is our producer. Our associate producers are Olivia Graham and Olivia Lake, hair and makeup. Just hopes everyone gets along. Devin Emery is our president and our show is a production of Morning Brew.
Toby Howell
Great show today, meal. I wish you all well.
Katie
Oh, hello, Morning Brew Daily. It's Money with Katie here. When I first started learning about money, I heard all about the best price practices, right? Spend less than you earn, max out your 401k, pay off high interest debt. All good advice, but most personal finance content didn't address one major theme, that women experience money differently. From the hot girl hamster wheel of paying monthly for beauty regimens to the way women are more likely to leave the workforce to take care of children or aging parents. Or even that women just simply lay live longer and therefore need to invest more aggressively, no one was really talking about the ways in which women need a different strategy. So that's what I have spent the last five years tackling at Money with Katie. And now I've taken everything I've learned and put it into my book, Rich Girl Nation, coming out June 10th. You'll learn how to build wealth for yourself, but you'll also see how we can rewrite the rules of money for women once and for all. Cy personal finance pros like Paula Pant, Farnoosh Tarabi, and J.L. collins recommend rich Girl Nation. And grab your copy now@moneywithkatie.com RichGirl Nation it's time to revolutionize how we think about money.
Title: Tesla Sinks After Musk-Trump Beef & Can the Switch 2 Save Nintendo?
Release Date: June 6, 2025
Hosts: Neal Freyman and Toby Howell
The episode opens with Neal Freyman and Toby Howell delving into the explosive fallout between Elon Musk and former President Donald Trump. This public breakup has had significant repercussions for both Tesla and SpaceX, leading to a dramatic decline in Tesla's stock.
Stock Market Impact:
Elon Musk and Donald Trump's public feud culminated in Tesla's stock plummeting by 15%, marking the company's largest single-day loss ever and stripping over $150 billion from its market cap.
Neal Freyman notes, "[...] the decoupling of Musk and Trump was perhaps even more explosive than expected, with billions of dollars of market cap and government credits caught in the crossfire." [04:02]
Government Contracts and Subsidies:
The tension stems from Musk's criticism of Trump's proposed tax and spending bill, which Musk labeled a "disgusting abomination" for ballooning the deficit and cutting EV incentives. Trump retaliated by threatening to revoke federal subsidies and contracts essential to Tesla and SpaceX.
Toby Howell adds, "SpaceX has benefited from $22 billion in federal spending, while Tesla has received around $11 billion in regulatory credits." [05:07]
Potential Ramifications:
The duo's clash underscores the intertwined nature of their businesses with federal policies. Musk's threat to halt the Dragon spacecraft's development—a crucial asset for NASA—highlights the leverage each wields. However, there are signs of potential reconciliation, as Musk's Tesla stock recovered by 5% the following morning, suggesting the situation remains fluid.
Neal Freyman observes, "Bill Ackman, who is his head fund manager, tweeted, 'hey guys, please calm down. Like you need to buddy up again because there's so much at stake.'" [05:57]
Shifting gears, the hosts discuss the highly anticipated release of the Nintendo Switch 2, which has already seen impressive sales despite challenges.
Sales Success:
The Switch 2 launched to record-breaking sales, with retailers worldwide struggling to keep up with demand, particularly in Japan. This launch echoes the massive enthusiasm seen during previous console releases.
Toby Howell remarks, "The Switch 2 is looking like it's off to a flying start." [08:13]
Product Enhancements:
Building on the original Switch's success, the Switch 2 boasts enhanced hardware, a larger screen, and updated controllers. However, it comes with a higher price tag of $450, a 50% increase from its predecessor. Despite the price hike, consumer demand remains strong.
Neal Freyman explains, "The Switch 2 is more powerful, has a bigger screen, and arrives with more modern controllers than its predecessor." [09:39]
Game Releases and Market Strategy:
Accompanying the console is "Mario Kart World," an $80 game that signifies rising prices in the gaming industry. Nintendo leverages its strong portfolio of exclusive titles to drive sales, ensuring continued consumer interest despite the higher costs.
Toby Howell adds, "Nintendo has just this great archive of games that constantly updated and attract new fans, even to this day." [10:31]
Historical Context and Future Prospects:
Unlike previous Nintendo consoles, which faced challenges with follow-up models, the Switch 2's conservative yet effective design strategy avoids the "second console jinx." Analysts remain optimistic about its potential to surpass legacy expectations.
Toby Howell notes, "Analysts are bullish because they're just making it a little bit better, which will probably not lead to that second console jinx." [09:39]
Neal introduces the "Stock of the Week" segment, highlighting Circle's impressive public offering.
IPO Success:
Circle, a stablecoin issuer, saw its stock surge by 168% on its IPO day, marking the best performance for a large IPO since 2021. This surge reflects investor optimism about stablecoins revolutionizing financial transactions.
Neal Freyman states, "A stablecoin is a cryptocurrency that's supposed to be well stabilized by being pegged to another asset, typically the US dollar or Treasuries." [12:55]
Market Potential:
With a market cap of around $62 billion, Circle's USDC is the second-largest stablecoin behind Tether. The growing use of stablecoins in remittances, B2B payments, and e-commerce signifies their expanding role beyond niche crypto circles.
Toby Howell comments, "If Congress does pass legislation that regulates these things, then it could be a new era for the financial system." [14:02]
Regulatory Landscape and Future Outlook:
Advancements in stablecoin legislation and the integration of stablecoins into mainstream financial systems bolster Circle's prospects. The positive IPO performance is indicative of broader market confidence in the stablecoin economy.
Neal Freyman concludes, "Shares of companies that went public in the US this year are up 15% on average from their IPO prices." [14:37]
In the "Dog of the Week" segment, the hosts examine the decline of TikTok-driven fast fashion apps like SHEIN and TikTok's impact on these businesses.
Declining User Engagement:
TikTok-based fashion apps have faced significant user drops, with SHEIN's daily active users falling by 52% and TikTok's own platform experiencing a 25% decline since March.
Neal Freyman highlights, "Both apps have plummeted down the app store rankings." [16:30]
Impact of Tariffs:
The introduction of a 50% tariff under Trump's global trade policies has rendered these apps less competitive in the US market, forcing them to withdraw due to unsustainable costs.
Neal Freyman explains, "The effective tariff rate is 54%, making it uncompetitive for these companies to operate in the US." [17:35]
Attempted Market Shifts:
With the US market becoming untenable, companies like SHEIN are redirecting their efforts towards Europe, albeit facing their own set of regulations and lower de minimis thresholds.
Toby Howell notes, "Europe is a difficult market to enter as well because they have a lot of legislation and regulation." [18:18]
Challenges in International Expansion:
Businesses struggle with the complexities of international markets, including VAT registrations, diverse plug standards, and multilingual requirements, often describing the process as "hell mode."
Neal Freyman shares, "A business owner had to translate his instruction manuals into at least five different languages." [19:01]
The discussion transitions to the booming Broadway scene, which has seen unprecedented success in the latest season.
Historical Revenue Milestone:
Broadway grossed a record $1.89 billion from May 2020 to May 2025, surpassing the previous record of $1.83 billion set in 2019.
Neal Freyman states, "This season, Broadway shows grossed more money than any other in history." [19:01]
Attracting Top Talent and Younger Audiences:
High-profile actors like George Clooney, Denzel Washington, and Jake Gyllenhaal have starred in successful productions, drawing in diverse audiences. Additionally, Broadway has effectively engaged Gen Z with contemporary themes and pop music-infused productions.
Toby Howell explains, "They're incorporating more pop music into plays and attracting younger audiences with relatable storytelling." [20:51]
Record Young Audience Demographics:
Productions like "Romeo and Juliet" have recorded unprecedented engagement from younger demographics, with 14% of ticket purchasers aged 18 to 24, compared to the industry average of 3%.
Neal Freyman highlights, "This is the youngest ticket-buying audience ever recorded on Broadway." [21:43]
Strategic Marketing Initiatives:
To sustain this growth, Broadway is implementing strategies such as offering discounted student tickets, ensuring accessibility for younger patrons while maintaining its affluent audience base.
Toby Howell notes, "They gave out cheaper tickets to students to bring them in, contributing to the record young crowd." [22:15]
Upcoming Productions:
Excitement builds for the return of Tom Felton as Draco Malfoy in "Harry Potter and the Cursed Child," set to premiere in November, further boosting Broadway's appeal.
Neal Freyman adds, "If you are a Malfoy fan, you can see him in November." [22:15]
a. Amazon's Exploration of Humanoid Delivery Robots
Amazon is testing human-like robots designed to handle last-mile deliveries. These robots, developed in a secret park in San Francisco, aim to navigate suburban environments efficiently. While innovative, the integration of such robots could disrupt traditional delivery jobs and cause confusion among residents and pets alike.
b. Hermes Birkin Bag Auction in Paris
The original Hermes Birkin bag, a historic piece inspired by actress Jane Birkin, is up for auction in Paris. Valued as a unique memorabilia item, the bag symbolizes luxury and timeless fashion, reflecting its creators' collaboration on a design that has become iconic in the fashion world.
Neal Freyman: "The sketch ended up as a one-of-a-kind prototype that is as tall as it is deep and wide with the crossbody strap and, of course, the initials JB on the front." [25:40]
Toby Howell: "Birkin bags are appreciating assets, outperforming the S&P 500 over this era of time." [26:37]
Neal and Toby wrap up the episode by encouraging listeners to engage with Morning Brew Daily and share their thoughts via email. They also briefly mention upcoming segments and thank the production team.
Neal Freyman:
"The big question is where do we possibly go from here after the dust has settled? It's anybody's guess." [00:58]
Toby Howell:
"The Switch 2 represents a bridge between the past and future of gaming." [07:00]
Neal Freyman:
"Shares of companies that went public in the US this year are up 15% on average from their IPO prices." [14:37]
Toby Howell:
"If you are a Malfoy fan, you can see him in November." [22:15]
This episode of Morning Brew Daily provided a comprehensive overview of significant events impacting major industries, from high-stakes corporate disputes and groundbreaking product launches to record-breaking performances in entertainment and innovative advancements in technology. Neal Freyman and Toby Howell delivered insightful analysis, enriched with pertinent quotes and detailed discussions, making it an informative listen for those looking to stay updated on current business and economic trends.