Trump Targets DEI Programs & Walmart Managers Make $600K?

Summary

Morning Brew Daily: Trump Targets DEI Programs & Walmart Managers Make $600K?

Release Date: January 24, 2025
Host: Neal Freyman & Toby Howell

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Introduction

In this episode of Morning Brew Daily, hosts Neal Freyman and Toby Howell dive deep into pressing topics shaping the business and economic landscape. From former President Trump's aggressive stance on Diversity, Equity, and Inclusion (DEI) programs to the surprising surge in compensation for Walmart's regional managers, the show unpacks the implications of these developments. Additionally, they explore controversies in the film industry, stock market movements, significant legal settlements, and quirky stories making headlines. Notable quotes from the hosts provide insight and context throughout the discussion.

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Trump's Campaign Against DEI Programs

Former President Donald Trump has intensified efforts to dismantle DEI initiatives within the federal government and the broader corporate sector. Through multiple executive orders issued over the past week, Trump has targeted DEI mandates, causing significant upheaval in corporate America.

Key Points:

• Executive Orders: Trump’s directives include placing DEI office employees on administrative leave and threatening adverse consequences for non-compliance with DEI reporting.
• Corporate Response: Companies like American Media and Walmart have proactively rolled back DEI programs, anticipating regulatory changes. However, giants such as Costco, Apple, and Microsoft remain steadfast, citing long-standing commitments to diversity and inclusion that date back decades.
• Supreme Court Influence: The Supreme Court's decision to ban affirmative action in higher education has emboldened Trump’s administration to push for similar measures in the private sector.
• Shareholder Proposals: Attempts to use shareholder votes to dismantle DEI policies have largely failed, with proposals against major corporations like Apple and Walmart being rejected by over 98% of shareholders.

Notable Quote: Neal Freyman reflects on the historical context of DEI initiatives:
“In 2020 we saw a boom in DEI... Fast forward to the first two weeks of this year... there was a 93% decline. You can really see the boom and bust of this particular department in corporate America.” [05:22]

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Walmart Managers' Compensation Surge

Amidst corporate restructuring, Walmart has introduced a new compensation scheme for its regional managers, resulting in substantial salary increases.

Key Points:

• Salary Boost: Regional managers can now earn up to $620,000 annually, a $50,000 increase from the previous cap, primarily through higher bonuses and stock awards.
• Job Responsibilities: These market managers oversee approximately a dozen stores each, managing up to 3,600 employees in total. The role demands extensive travel and meticulous oversight to ensure seamless store operations.
• Corporate Strategy: Unlike other corporations reducing managerial layers to cut bureaucracy, Walmart's strategy underscores the critical role these managers play in maintaining operational excellence.
• Market Impact: Walmart's shares surged over 80% last year, reaching a market capitalization of nearly $800 billion, reflecting investor confidence in its management and strategic direction.

Notable Quote: Toby Howell emphasizes the uniqueness of Walmart’s approach:
“These are basically like companies in themselves that they're managing. They're managing a portfolio of stores... It is a pure management role.” [20:36]

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Oscar Nominations and AI Controversy

The latest Oscar nominations highlight a shift towards more progressive and under-the-radar films. However, the use of artificial intelligence (AI) in film production has sparked debate.

Key Points:

• Top Nominees: Films like Amelia Perez and The Brutalist lead with 13 and 10 nominations respectively, showcasing diverse and innovative storytelling.
• AI in Filmmaking: The Brutalist faced backlash for using AI to alter an actor’s voice, reigniting debates about the ethical implications of AI in creative industries.
• Industry Perspective: Hosts discuss historical uses of technology in film, noting that AI is not a novel tool but its application has become controversial in recent years.

Notable Quotes: Neal Freyman counters the AI backlash by referencing past practices:
“If you just go back a little bit in cinema history, you find that using AI is nothing new.” [15:12]

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EA Sports Faces Market Challenges

EA Sports has seen a notable decline in its stock price following disappointing sales of its latest soccer video game installment, FC25.

Key Points:

• Sales Decline: FC25 failed to meet sales expectations, with player dissatisfaction stemming from a lack of innovation and persistent in-game bugs.
• Financial Impact: EA forecasts a mid-single-digit decline in live service Net Bookings and has reduced its 2025 revenue forecast by approximately half a billion dollars.
• Competitive Landscape: Unlike EA, other game titles such as Grand Theft Auto 6 are performing strongly, highlighting EA's struggles in maintaining its market position.

Notable Quote: Toby Howell underscores the severity of EA’s challenges:
“EA, that's up 16%. That's its worst day in many years.” [22:11]

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Opioid Crisis Settlement Nears Closure

A landmark settlement has been reached to address the opioid crisis, marking a significant development in a prolonged legal battle.

Key Points:

• Settlement Details: The Sackler family and Purdue Pharma have agreed to a $7.4 billion settlement with 15 states. This includes the Sacklers paying up to $6.5 billion over 15 years and Purdue Pharma contributing nearly $900 million.
• Previous Agreements: The settlement modifies earlier deals that were struck down by the Supreme Court due to unfavorable bankruptcy terms for claimants.
• Funding Allocation: The funds are designated for opioid addiction treatment, prevention, and recovery programs across the United States.

Notable Quote: Neal Freyman highlights the complexity of the settlement:
“States have to pay into a legal defense fund for the Sacklers... it's a very weird thing to wrap your mind around.” [24:42]

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CNN's Strategic Shift in the Digital Age

In response to declining viewership, CNN has announced significant restructuring to focus on digital platforms.

Key Points:

• Job Cuts and Hiring: CNN will cut 200 jobs from its traditional cable TV operations and invest similarly in its digital infrastructure.
• Streaming Service Launch: A new streaming service is slated for release later in the year to adapt to changing audience consumption patterns.
• Viewership Decline: Recent events, including the inauguration, saw a historic low in TV viewership, exacerbating the need for CNN to pivot towards digital solutions.

Notable Quote: Toby Howell comments on the broader industry trend:
“It's endemic to the entire cable news industry... it's something that is affecting the entire cable news industry.” [27:21]

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Rookie MLB Card Sparks Negotiations

An 11-year-old collector discovered a rare Paul Skeens autograph card, leading to high-stakes negotiations with the Pittsburgh Pirates.

Key Points:

• Card Rarity: The one-of-a-kind card has become highly sought after in the collector community, fetchingly potential auction prices of $1 million or more.
• Pirates’ Offer: The team proposed a package including season tickets and exclusive experiences, which has been widely criticized as insufficient.
• Collector's Dilemma: The young collector faces pressure to maximize the card’s value against appealing but inadequate offers.

Notable Quote: Neal Freyman humorously questions the Pirates’ offer:
“The collector lives in L.A. and he wants the Pirates are asking him to come to Pittsburgh and go to Pittsburgh Pirates games. Like I would say no to that.” [29:18]

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Australia’s Corpse Flower Blooms

The rare blooming of Australia’s corpse flower, dubbed "Putricia," has captivated global audiences with its unique and pungent aroma.

Key Points:

• Bloom Rarity: Occurs once every 15 years, making each bloom a significant event for botanical enthusiasts and the general public alike.
• Global Fascination: The event has attracted nearly 1 million viewers through livestreams, sparking meme culture and online engagement.
• Symbolic Significance: Zoo presidents liken the corpse flower’s blooming to the presence of pandas, emphasizing its status as a natural spectacle.

Notable Quote: Toby Howell draws a parallel with other rare animals:
“The corpse flower is the panda of, you know, the fauna.” [30:35]

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Conclusion

Neal Freyman and Toby Howell provide a comprehensive analysis of today's influential topics, from high-stakes corporate decisions and political maneuvers to unique cultural phenomena. Their insightful commentary and inclusion of memorable quotes offer listeners a nuanced understanding of the current economic and social climate.

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Notable Quotes:

• Neal Freyman: “Are you looking for words of affirmation? Go to your significant other. Go to a therapist.” [01:41]
• Toby Howell: “These are basically like companies in themselves that they're managing.” [20:36]
• Neal Freyman: “AI is nothing new. Using tech in post production is nothing new.” [15:12]

For more discussions and insights, subscribe to Morning Brew Daily on your preferred podcast platform or YouTube.

Transcript

[Ryan Reynolds]

Hey there, Ryan Reynolds here. It's a new year and you know what that means. No, not the diet resolutions. A way for us all to try and do a little bit better than we did last year. And my resolution, unlike big wireless, is to not be a raging and raise the price of wireless on you every chance I get. Give it a [e-mail] Switch $45 upfront.

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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 the Oscar nominations are out, but could an AI controversy derail a best picture contender?

[Toby Howell]

Then Trump's move to abolish DEI initiatives at the federal level is causing chaos in the corporate world. It's Friday, January 24th. Let's ride.

[Neal Freyman]

Toby. There's been something bothering me for a few days now. I went to the dentist kissed earlier this week. And you always brace for some gentle scolding by the hygienist, like, you should really floss more. And I was prepared mentally for that. This wasn't my first rodeo, of course, but in this instance, I went in, she cleaned my teeth, and when she was done, she was like, okay, you're good to go. See you in six months. Absolutely no feedback, positive or negative. Kind of rattled me, I have to say. I mean, my teeth are solid, but are they at a zero feedback level? I thought the dream was to get no feedback, but when it was actually realized, I'm not so sure anymore. Would you rather get a lot of dental feedback or none at all?

[Toby Howell]

What you just described to me is the ideal dental visit. This isn't a weekly one on one with your manager. You're not looking for actual constructive criticism. The fewer words exchange, the better, in my opinion. If you were looking for words of affirmation, which I think you were, go to your significant other. Go to a therapist. They can fill the cavities in your soul and your heart that you are looking for your dentist to fill there. But I am very curious to hear people's thoughts on this because that isn't probably the only dental experience that people have had where they haven't gotten any feedback whatsoever. So clearly you're still thinking about it.

[Neal Freyman]

So I am still thinking about it.

[Toby Howell]

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[Toby Howell]

Finance.com after years of embracing the idea that a more diverse, equitable and inclusive workforce was beneficial, the business world is now grappling with the government's change of course on those issues. Donald Trump has issued multiple executive orders this past week relating to terminating illegal DEI mandates in the federal government. On Monday, he put those who worked in federal DEI offices on administrative leave. And a memo issued this Wednesday warned employees that they could face adverse consequences if they fail to report on anyone continuing to work in DI for the government. Some companies like Media and Walmart got ahead of the curve and already began to roll back their DI programs leading up to the election. But others are fighting back against the shift. Speaking at Davos, JP Morgan CEO Jamie Dimon told CNBC to quote, bring them on when asked about activists pushing the bank to change their existing policies. Costco, Apple, Microsoft and others have also held fast to their initiatives as well. So Neil, there is clearly a lot of moves and counter moves going on right now as businesses try to position themselves amongst a shifting cultural and legal landscape when it comes to dei.

[Neal Freyman]

It absolutely is shifting. And I want to go back to even before Trump was inaugurated. So in 2020 we saw a boom in DEI. Glassdoor saw a 50% increase in job post postings for DEI roles. That came right after the murder of George Floyd. And a lot of corporate America decided that it was incumbent on them to to establish more diversity inclusion initiatives. Fast forward to the first two weeks of this year. ZipRecruiter had 561 postings for DEI job programs. That was a 93% decline from the same period just a year before. So you can really see the boom and bust of this particular department in corporate America. As you mentioned, a lot of companies have been rolling back their DI policies in recent years. A lot of that you can drive a through line to the Supreme Court decision that banned affirmative action in higher ed. Now it's on its last legs and all these, these sweeping comprehensive really ambitious executive orders by Donald Trump hopes to deliver the knockout blow.

[Toby Howell]

It does seem like Trump is testing to see whether that Supreme Court decision can actually be extended to private employers. It looks like we're setting up a court battle about if these DNI DI initiatives can be struck down through executive orders. One of the big tools that these anti DI activists are using are trying to bring shareholder proposals to companies to try to ensure that these die policies are are struck down. Their argument is a financial one, saying that look at what the federal government is doing. They are changing these DI policies that leaves us as shareholders vulnerable to lawsuits against us. Meaning like the company that they are shareholders in if we continue to have these DI practices in place. The problem is, is that those shareholder votes are pretty routinely rejected. A lot have been filed against Apple, Walmart, star, Starbucks. They have all been handily defeated. They rarely get more than 2% of shareholder support. So even though you hear some noise when it actually comes down to what shareholders want, they are not supporting these anti DI efforts.

[Neal Freyman]

And one just happened yesterday. You mentioned the name before Costco, Coco. Costco's shareholders defeated a proposal against their DI policies. And Costco has sort of taken the mantle as one of these corporations that says, I know what everybody else is doing. Not everybody else, but a lot of these other companies are doing tractor supply, Harley Davidson, Walmart, McDonald's. We've talked about it on this show. A bunch of companies have rolled back di, but Costco said no, this is really important to us. It enhances our capacity to attract and retain employees who will help our business succeed. So they rejected that proposal. And a number of other companies have come out and said, no, DI is really important to us. You can as, as Jamie Dimon said, like come on with the lawsuits. Apple defended its DI policies. Microsoft did as well. Pinterest did as well. And the common thread with all of these companies, Costco, Apple, who are trying to preserve their DI policies is they didn't just start hiring for them in 2020. These policies go back to the 90s and the 2000. This has been ingrained in their culture for a long time. They've tried to promote DI for decades now. So it wasn't these fly by night DEI departments that were sprung up post George Floyd in 2020. The common thread through all of these companies that are the holdouts right now are that they've had these DEI initiatives in place since the 90s. Hope you're wearing Canada Goose and Cashmere because now we're headed on a trip to DAVOS Switzerland, the ski town where the World Economic Forum has been taking place. Top corporate brass, world leaders, and other PJ types have been yakking it up since Monday. But the main subject on everyone's minds, the newly inaugurated President Trump has been absent. Until yesterday, that is. Trump delivered a virtual address to executives, his first major speech since taking office that was 45 minutes long and particularly newsy. So we'll break down the bits you need to know. One major development, Trump called on opec, a cartel of oil producing countries, to bring down the price of crude oil, which he linked to ending Russia's war in Ukraine. The thought being Russia funds its military campaign through oil revenues, and if the price dips, their resources dry up. Oil actually did fall 1% on that news. Trump also tried to assert his influence on the Federal Reserve, saying he would, quote, demand that interest rates drop immediately, and likewise, they should be dropping all over the world. During his first term, Trump frequently attempted to bully Fed Chair Jerome Powell to lower rates, to little success. But it looks like he's running it back. This pressure campaign worries the vast majority of economists, even conservative ones, because they see the Fed's independence from politics as a key factor in healthy markets. Toby, what stood out to you?

[Toby Howell]

Yeah, this was a long and meandering speech, 45 minutes packed with a lot of stuff to break down. I think if you take it as a whole, though, it was kind of Trump laying out his proposal for almost a carrot and stick approach to how he's going to approach world economics in this next term. So he clearly wants to lower taxes in America to incentivize companies to set up businesses there. And he also wants to raise taxes, raise tariffs on companies outside of America to hopefully offset some of that revenue lost from lowering taxes in America. He definitely wants to produce more oil. Oil was obviously one of the big headline announcements that he has. He thinks will lower energy costs, bring down inflation, and then he also wants to lower interest rates, which again, is something that is more of a want right now than anything else because, again, the Fed does have its independence. So he was trying to lay out this vision that he has to solve everything that is ailing the US Economy, bring down those higher prices, bring down those higher taxes, kind of restart manufacturing in the country and jumpstart a world where the US Is the largest energy producer as well, and also get those interest rates down. So part of it was, you know, actual vision, part of it was just kind of hopeful, I'm going to tell Jerome Powell to lower interest rates, but it was quite newsy.

[Neal Freyman]

It does set up a clash between Trump and Powell because he did frequently bash Powell in his first term to bring down interest rates. Powell said, you know, I don't know if he even acknowledged Trump. He just said, I'm going to do what the Fed should do. And, you know, most people think that that's the way this should operate. You don't want the Federal Reserve to have political interests in mind when it's raising and lowering interest rates, because if, you know, if the Fed lowers interest rates too much now, that could lead to another bout of inflation. It has to that long term view. But it still feels like Trump is going to keep up the pressure on Powell because even after he gave this speech, he goes back to the Oval Office to sign some more executive orders. And he said, I think I know interest rates much better than they do, they being the Federal Reserve. Then he took a very specific shot at Powell. I think I know them certainly much better than the one who's primarily in charge of making that decision, which is pal. If I disagree, I will let it be known. And I just have to emphasize how rare this is and unusual for a president to be involved in interest rate decisions like this.

[Toby Howell]

And then finally, just to hammer home the point about Trump wanting to produce more energy to produce more oil, the problem with this drill baby drill approach is that demand around the world isn't very strong for oil right now. Big economies, big world economies, mainly China, are kind of struggling with some of the similar issues that the US Is, which is higher inflation, lower job growth. So the United States is producing more oil than any country at any time in history right now. So it's not exactly oil companies aren't exactly clamoring to get new leases to build new drills. So that is why you saw the oil market kind of react negatively to Trump speaking on it, because there just isn't quite demand to match the supply that Trump wants to bring to the market.

[Neal Freyman]

And Saudi Arabia is quite reluctant to have lower oil prices because as we've talked about many times on the show, they've got some big ambitions to build out futuristic cities and diversify into all these different industries in tech and AI and sports and entertainment. And the way they fund that is through oil revenue. And so they want a higher price so they can fill their coffers and fund those huge plans that they have. The Oscar nominations were released yesterday morning. And unlike the blockbusters that dominated last year's Slate Barbenheimer, this year's nominees are led by more under the Radar cinema with progression, progressive themes. Amelia Perez Netflix's musical about trans identity scored the most nods of any movie with 13. It's the most nominated non English language film in Oscars history and the most nominated film in Netflix's history. Another sleeper hit is the Brutalist, a low budget indie epic about a Jewish immigrant in America which scored 10 nods. The two I just mentioned were nominated for best Picture, joined by Conclave, the Substance, Nickel Boys and Nora. I'm Still Here, a complete unknown and box office juggernauts Dune Part 2 and Wicked. Of those movies, Wicked is up for the Most awards with 10 tying the brutalist. Unlike last year when Oppenheimer mostly had a best picture on lock, it's a pretty wide open race for the title this time around. We'll find out who wins on March 2nd when the awards ceremony is held in Los Angeles. Conan O'Brien is going to host. Very pumped about that. But it's expected to be a more subdued event than in past years to reflect the wildfires that devastated parts of L A earlier this month.

[Toby Howell]

Yeah, it is a different Oscars ceremony this year not only because of the wildfires but also because it is a much more wide open race. Brutalist and Nora Conclave, they all have the joint highest odds for taking home the best picture. It is also interesting because I was looking at the box office haul of the Brutalist so far in the United States and it's. I can't really even call it a haul because it's just about $8 million. It hasn't been widely released yet so more people will see it but it's a pretty low attended so far best picture nominee. It also has some controversy tied to it as well. The editors of the movie admitted to using AI to touch up and change part of the actors voices in the movie. Adrien Brody has this Hungarian accent. Hungarian is a very difficult language to speak. It has a lot of nuances to it and they said listen, if we didn't use these tools we would still be in post production right now. It was a very tight budget, only $10 million. But again there is this kind of perception that AI is this replacement for workers is taking away workers from creatives. Which is why you saw a little bit of controversy with its usage of AI So certainly a little bit of a different feel from the Barb and Heimer epic of last year's Oscars. But a lot of good movies up for grabs.

[Neal Freyman]

Many were quick to point out after the backlash to the Brutalist using AI to touch up actors, voices that this is nothing new. I was used in so many movies in years past. We just weren't all kind of freaking out or knew about it. Get Back by Peter Jackson, that documentary about the Beatles, without AI that wouldn't have existed. The Irishman used AI to de age Al Pacino and Robert De Niro. Bohemian Rhapsody, that biopic about Freddie Mercury, Rami Malek, when he sang those songs, that was actually an amalgamation of multiple different voices. So if you just go back a little bit in cinema history, you find that using AI is nothing new. Using tech in post production is nothing new. So this, this brutalist brouhaha might have been a little bit of a nothing burger.

[Toby Howell]

And I do just want to talk about a few snubs real quick before we go to break. My biggest snub was Denzel Washington and Gladiator 2. When Gladiator 2 came out, there was all this talk that he was going to win, you know, best Supporting Actor. He absolutely dominated that movie and I saw it and it was not a good movie. But Denzel was fantastic in it. Didn't even even get nominated, which was sad. And then of course we talked about it at the top of the show. But challengers, not getting nominated for best Original score is a travesty. Anyone who has seen that movie with Zendaya and the Tennis, they know that the one of the main characters was the soundtrack of that movie. So the fact that it didn't get a nod is heartbreaking to me.

[Neal Freyman]

Zendaya and the Tennis is the most hilarious descript of challenges I've ever heard.

[Toby Howell]

I'm not going to go into the details. Up next, it is Stock of the Week, Dog of the Week. Time.

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[Neal Freyman]

You know what that means. Stock of the Week Dog of the Week, the segment where Toby and I pick one stock that was inducted into the hall of Fame like Ichiro, and another that is still waiting its turn. I won the pre show Name all the prime numbers in order contest. 59 will get you every time Toby. So I get to go first and my Stock of the week is Walmart, but more specifically the employees who oversee a bunch of Walmart stores. Under a new payment scheme, those regional managers could pull in more dough than your friend in investment banking. According to the Wall Street Journal, Walmart's top regional managers stand to make up to $620,000 per year as a result of higher bonus and stock awards, a 50k bump from their previous ceiling. Sorry Dwight, assistance to the regional manager are not eligible. The pay bump, which is laden with performance incentives, shows how critical smooth store operations have become for the country's biggest retailer and how hard it is to find people who can do this well, because it is a really demanding job. These managers, known internally as market managers, oversee about a dozen stores apiece, and each store can have 300 employees. The market manager is a road warrior, spending long hours driving to each location to ensure the Walmart machine is humming. And boy, it has been humming. Shares were up more than 80% last year, pushing its market cap to nearly $800 billion.

[Toby Howell]

It is fascinating to see someone with the title manager getting this big pay bump, because if you look across corporate America, managers are not exactly popular words and popular positions because a lot of companies are trying to flatten themselves. There's too many layers of bureaucracy. Amazon CEO Andy Jassy has said he wants to increase the ratio of workers to managers. Google CEO Sundar Pichai also said that they had called about 10% of its managerial roles. So in big tech, there is this move to get rid of managers. Walmart, though, is prioritizing them because these are basically like companies in themselves that they're managing. They're not just managing one store. They're managing a portfolio of stores are going and checking in on each store manager. It is this job that requires management like it is a pure management role. And you see that in just these massive salaries. Every time Walmart kind of publicize these salaries, this story goes a little bit mini viral because the number is big. $620,000. If you get full bonuses, that is a hefty chunk of change.

[Neal Freyman]

The number is big. But when you go and read about the job description, the responsibilities that these people have, it all checks out. Because I'm looking at this, I'd be like, I am terrible at this job. This looks so hard. These stores are massive. There's so many moving parts, so many people and to drive to each one of them, check in, make sure everything's going okay. Sounds like something I would be absolutely terrible at. And it's. And you know, from at least my perspective, the 600k is even a low ball because each of those Walmart stores is probably pulling in tens of millions of dollars each year.

[Toby Howell]

My dog of the week is EA Sports because no one is playing its soccer video games anymore. ITS stock fell 16% yesterday after the video game maker reported slumping Demand for its FC25 video game. Now if you're thinking to yourself FC25, what even is that? Well, I'm right there with you. FC25 is a franchise that used to be known as FIFA before the two parties couldn't come to a licensing agreement prompting a name change. But the game sold well last year, so you can't pin it all on a name. Mostly players complained about a lack of innovation as well as some weird in game physics bugs which gave the franchise less staying power than its predecessor. That is bad news for ea, who relies on its soccer games to be a consistent revenue driver for the company. It is forecasting that its live service Net Bookings, which is all the money it makes from microtransactions within the game, is set to decline by mid single digits this year. EA shaved about half a billion dollars off its 2025 revenue forecast as well. So these problems are certainly affecting the bottom line.

[Neal Freyman]

Yikes. I mean, and even the titles that it's trying to roll out to make up for, I'm just going to call it FIFA, sorry, has not been working out. It released this new game called Dragon age that garnered 1.5 million players during the quarter that underperformed the company's expectations by nearly 50%. So half of all people it expected to play this game didn't show up. So that is a huge problem. There's a lot of weakness in, in its soccer game and then everything else is trying to do is also not working out. So EA, that's up 16%. That's, that's its worst day in many years. Meanwhile, the video game industry is not really thinking about ea. There's a bunch of other exciting things happening separately from this. You got the Switch 2 coming out. You got Grand Theft Auto 6 coming out in November. So it's kind of a backwater over there in a. Yeah.

[Toby Howell]

Just something to illustrate that point. EA stock trades at about 17 times its forward earnings estimates. Take two, which makes GTA, they're trading at about 27 times their forward earnings estimate. So there's clearly a lot more excited for that upcoming GTA franchise. But yeah, when you talk about. Basically people in the industry call FIFA or FC25 the Swiss clock of, of media because it is just so consistent every year. Everyone loves playing FIFA, everyone loves playing FC24. But this year, for some reason, growth stagnated. People aren't buying as many packs in games when they're making their ultimate team. So that is a huge warning light for ea. If they can't have their day in, day out performer, if that starts to fall off a cliff, then it gets a little ugly for them because they need their, you know, kind of consistent Steph Curry to come out and give him 30 points a game. Right now, he's not playing very well. Now let's sprint to the finish with some headlines from the week's news you may have missed. Up first, a long and winding chapter in the opioid crisis in America is finally coming to a close. The Sackler family and the company they control, Purdue Pharma, reached a $7.4 billion settlement with a coalition of 15 states over its role in fueling the opioid crisis. Under the agreement, the Sackler family will pay up to six and a half billion dollars over 15 years, while Purdue Pharma will contribute nearly 900 million. The settlement is one of the biggest payouts to emerge from the US opioid crisis that has led to over 600,000 deaths since 1999. According to the CDC. The money will fund opioid addiction treatment prevention and recovery programs nationwide.

[Neal Freyman]

It has taken a long time to get here. Remember, they already agreed to a settlement a few years ago where they would pay billions of dollars to fund to fund those programs. And that was hailed as a major victory. But the Supreme Court struck down that deal over some bankruptcy terms and that was left that left the claimant saying, well, okay, well, all that money is not, is not going to, to our coffers anymore. Now they've reached a new deal, which is extremely unusual and creative. Basically, it says that states have to pay into a legal defense fund for the Sacklers. The previous settlement said that the Stacklers would be shielded from future liability. That was the main sticking point for that. That's why it was rejected. Now they are opening themselves up to liability, but they say that actually the claimants now have to fund a legal defense fund for them as they face future litigation, because they are absolutely going to face future litigation. So it's this very weird thing to wrap your mind around where the claimants are paying into a fund to help the Sacklers defend themselves against future claimants.

[Toby Howell]

Yeah, it is a weird structural. The Sacklers are not given that automatic protection from liabilities that the previous deal did give them. But victims will also need to agree to not pursue further legal action against the Sacklers in order to receive a payout. So it is complicated, but the main story here is, is that the number that was agreed to go towards funding those opioid prevention and addiction and recovery programs is gone up. It used to be $6 billion. Now it's seven and a half billion. $7.4 billion. And it does seem like slowly this chapter is kind of winding to a close in the when it comes to the opioid crisis in America.

[Neal Freyman]

Okay, when was the last time you watched news on cable tv? Deafening silence. Which is why CNN announced a major restructuring yesterday to revive itself in the digital age, citing, quote, profound and irreversible shifts in the way audiences consume news. CEO Mark Thompson said CNN would cut 200 jobs, about 6% of its workforce in its traditional cable TV business, and hire a similar amount in the digital arena. Thompson also said CNN would launch a streaming service for a fee later this year. Ratings have been abysmal for CNN's flagship TV channel, and there's no Trump bump in sight. Just 1.7 million households watched the inauguration midday on Monday, down from 10 million from the previous inauguration in 2021. So this has become existential for CNN. Adapt or die.

[Toby Howell]

And it's endemic to the entire cable news industry. I mean, you said deafening silence when asked if people are watching tv. And it's true, because overall television viewership of the inauguration was the lowest in over a decade. Less than 25 million people tuned in to watch Trump take the oath to become president. That was down from 34 million who watched Biden, even down from the 31 million who watched Trump in 2017 as well. So it's not just CNN. Even though CNN is feeling pressure from both the left, MSNBC and the right of Fox News, it's kind of squeezed in the middle somewhere. It is just something that is affecting the entire cable news industry. One of the most sought after modern rookie cards for an MLB player was found this week by an 11 year old and now he's deep in negotiations with a ball club who wants it. Collectors have been trying to track down a Pittsburgh Pirates Paul Skeens autograph card ever since the flamethrower made his MLB debut. The one of one card was pulled by an 11 year old collector in Los Angeles, prompting the Pirates to make him an offer that they think he can't refuse. The package includes two season tickets behind home plate at Pirates games for 30 years, also the chance to host a softball game at the park for three decades and some other skins, merch and meet and greets. The collector community has pretty unanimously come out and said no, no, no, that is not nearly enough. Do not take the deal because this card is likely to fetch $1 million or more at auction.

[Neal Freyman]

Meanwhile, Skeen's girlfriend Livy Dunn is also putting up some some negotiating options of her own. She said you can come and watch a game with me. So we'll see if this 11 year old kid will take her up on that. But none of you're right. None of these, none of these offers match the monetary value of this card which is possibly going to be in the six figures. Meanwhile, this kid lives in L A and he wants the Pirates are asking him to come to Pittsburgh and go to Pittsburgh Pirates games. Like I would say no to that.

[Toby Howell]

That's been the biggest reaction is like what is this deal? This kid's an 11 year old, he's got school. Why would he ever want season tickets to a Pirates? He's not even a Pirates fan too. He lives in Los Angeles. So a lot of people were saying absolutely do not take this deal. But good on the Pirates I guess for you know, making news and at least trying to get their hands on this card.

[Neal Freyman]

Finally, mu dang is so last year, the Internet's latest obsession is a plant in Australia. Of course, this is no ordinary plant. It's known as a corpse flower and when it blooms it releases a horrific smell described as a combo of wet socks, hot cat food or rotting possum flesh. This particular plant has been dubbed Putricia, a combo of putrid and Patricia. Because the plants blooms are so rare. Patricia hasn't flowered in 15 years. This foul event has become a hot ticket at the Royal Botanic Gardens of Sydney, where tens of thousands of people have passed through in recent days to get a whiff of what my hockey bag smells like. But even non Aussies have gotten in on the fun. In less than a week, nearly 1 million people have joined a livestream of Patricia to make jokes, send memes, and riff on the newly created acronyms that have evolved around the blooming, such as wdnrnp. Did I say that right? Wdnrp. We do not rush Patricia.

[Toby Howell]

Wdnrp. It's a rallying cry around the world. The corpse flower is a celebrity whenever it blooms. There's a few around the world. One in San Francisco, there's another one in San Diego that do become these big events. They make headlines whenever they bloom because they do not bloom very frequently. It takes a lot of energy. This is a big flower we're talking about here. It takes a lot of energy for it to emerge from underground and, you know, spread its smelly wings for the world. And pollinators to see. Some presidents of zoos have told news outlets that this is basically like having a panda these days where, remember, pandas are very rare to be in zoo. So whenever one comes to, like a zoo near you, a lot of people flock to see it. The corpse flower is the panda of, you know, the fauna.

[Neal Freyman]

Or the pygmy hippo.

[Toby Howell]

Or the pygmy hippo. Right. Yeah, we do see these celebrities start to emerge. This one is definitely the smelliest. Although maybe Mudang is.

[Neal Freyman]

Who knows?

[Toby Howell]

I never saw them.

[Neal Freyman]

Don't say anything bad about her. 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. For any questions, comments, or feedback, send an email to Morning Brew daily at Morning Bukom. And if you're enjoying the show, don't be shy about it. Spread the word to your friends, family, and coworkers. For those of you who need an extra spark of inspiration, Toby's got you covered.

[Toby Howell]

I want you to share today's episode with someone who was a late bloomer. Not someone who smells bad. Just someone who took a little while to emerge but is now beautiful and maybe a little smelly. I want you to share the pod with them.

[Neal Freyman]

Okay, we'll do that. Let's roll the credits. Emily Milligrant is our executive producer. Raymond Lu is our producer. Olivia Graham is our associate producer. Eugenia Ogu is Our technical director, Garrett Peck is on audio. Hair and Makeup is offering free hair and makeup services. Services for Life for the Paul Skeens Guard Devin Emery is our chief content officer. Our show is a production of Morning.

[Toby Howell]

Brew and Go Birds.