🍋 Belt-Tightening Szn

Consumer spending makes up almost 70% of the total economy. While some economists still think we’ll avoid a recession, it might become a self-fulfilling prophesy if consumers adjust their spending habits as if we’re headed toward one

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“Every business is like an impressionist painting: it looks simple from far away, but chaotic from up close.” — David Perell

Good Morning! The Surgeon General wants to put the breaks on TikTok for tweens - he said 13 is too young for teenagers to be using social media. But the CEO of TikTok agreed to testify to Congress in March.

We’ve all heard of ‘quiet quitting’ but the latest trend in the corporate world, “quiet promotion” is when your boss piles on extra work without a title upgrade or a pay raise.

Prosecutors are accusing SBF of witness tampering in his upcoming court case. Bed Bath & Beyond will close 87 stores as the company tries to avoid bankruptcy. And Morgan Stanley’s chief investment officer said the 2023 stock market rally could end this week.

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1. Story of the Day: Belt-Tightening Szn

It seems like America's shopping spree has come to a screeching halt as the once mighty consumer starts to feel the weight of the economy. New data released Monday shows retail sales have declined in three of the past four months. The average American's monthly savings have taken a nosedive, with a recent study revealing that the savings rate plummeted from 7.5% to a measly 3.4% in just one year.

It's not just savings that have taken a hit, the housing and auto industries have also felt the pain. The housing market has seen its worst sales since 2014, and the auto industry saw its worst year in over a decade.

In the second half of 2020, they were the heroes of the economy, lifting it out of the pandemic-induced downturn with their eager purchases of exercise bikes, televisions, and laptops to keep themselves entertained during lockdowns. And once restrictions were lifted, they were the first to hit up their favorite restaurants and travel destinations.

However, with government stimulus running out and inflation on the rise, consumers are feeling the squeeze. Despite facing four-decade-high inflation, they continued to spend, but it seems that may be changing. As we head into 2023, it looks like consumers will have to tighten their belts and keep a firm grip on their wallets.

Takeaway: Consumer spending makes up almost 70% of the total economy. While some economists still think we’ll avoid a recession, it might become a self-fulfilling prophecy if consumers adjust their spending habits as if we’re headed toward one.

2. Markets Rundown

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Stocks snapped a six-day winning streak ahead of the Fed decision and tech earnings.

Movers & Shakers

  • (+) Carvana ($CVNA) +29% because a short squeeze sent the stock soaring.

  • (+) SoFi ($SOFI) +13% after the company gave an upbeat earnings forecast.

  • (–) Nvidia ($NVDA) -6% as demand for semiconductors falls.

Private Dealmaking

  • Energy Capital Partners bought Biffa, a waste management firm, for $2.6 billion

  • Paradigm, a clinical trial tech platform, raised $203 million

  • Welcome to the Jungle, a French jobs platform, raised $54 million

  • Scythe Robotics, a developer of landscaping robots, raised $42 million 

  • Micah Orthopaedics, a developer of an ACL repair implant, raised $40 million

  • ContractSafe, a cloud-based contract management platform, raised $27.5 million

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3. Top Reads

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  • Long Covid has an underappreciated role in labor market (CNBC)

  • Another bear market trap? (Fox)

  • Elon Musk wants to build a Twitter payments system to accommodate crypto (MW)

  • Why Meta’s earnings will tell us how online ads are doing (CNBC)

  • How effective altruists ignored risk (Vox)

  • Washington DC makes buses free as zero-fare transit takes off (CNBC)

4. Book of the Day: Progress

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It’s all over our televisions, newspapers and the internet. Every day we’re bludgeoned by news of how bad everything is – Brexit, financial collapse, unemployment, poverty, environmental disasters, disease, hunger, war. Indeed, our world now seems to be on the brink of collapse, and yet:

· We’ve made more progress over the last 100 years than in the first 100,000

· 285,000 more people have gained access to safe water every day for the last 25 years

· In the last 50 years world poverty has fallen more than it did in the preceding 500

Contrary to what most of us believe, our progress over the past few decades has been unprecedented. By almost any index you care to identify, things are markedly better now than they have ever been for almost everyone alive.

Examining official data from the United Nations, the World Bank and the World Health Organization, Johan Norberg traces just how far we have come in tackling the issues facing our species.

While it’s true that not every problem has been solved, we do now have a good idea of the solutions and we know what it will take to see this progress continue.

Counter-intuitive, dramatic and uplifting, Progress is a call for renewed hope in defiance of the doom-mongering of politicians and the media.

“A child born today is more likely to reach retirement age than his forebears were to live to their fifth birthday.”

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6. Daily Visual: AI Deals Boomin'

Global generative AI VC Deal Flow

Source: Axios

7. Daily Acumen: Dialetics

One way to use dialetics to improve relationships is to apply the process of analyzing and synthesizing opposing ideas to conflicts in personal or professional relationships.

This can involve taking the perspective of the other person and seeking to understand their point of view.

It also involves looking for common ground and finding a solution that incorporates the needs and concerns of both parties.

For example, in a disagreement between a manager and an employee, both parties could state their positions as the thesis and antithesis.

By engaging in a dialetic process, they could identify areas of common concern and find a mutually beneficial solution that addresses the concerns of both parties.

This approach can foster better communication, collaboration, and understanding, leading to stronger and more productive relationships.

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