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Morning Brew

Apple Card

Good morning. Here’s a convo starter for when your brunch discussion gets stale: Say you received an influx of cash in your Venmo account (maybe you’re running a March Madness pool). Are you the type of person who would instantly transfer it to your bank, or would you leave a balance?

We are a house divided: Half the writing crew would transfer the entirety of the balance, while the other half would leave a little cash behind for future payments because it feels like “free” money. #Brewmath.

—Molly Liebergall, Matty Merritt, Cassandra Cassidy, Abby Rubenstein, Neal Freyman

MARKETS

Nasdaq

16,428.82

S&P

5,234.18

Dow

39,475.90

10-Year

4.218%

Bitcoin

$62,602.78

Lululemon

$403.19

*Stock data as of market close, cryptocurrency data as of 4:00am ET. Here's what these numbers mean.

  • Markets: Investors slowed their roll a little yesterday after buoyant buying on news that the Fed is still planning to cut rates this year, but the Dow still pulled off its best week of the year. Lululemon did a downward dog after reporting a disappointing forecast and slowing US sales growth. The athleisure company suffered its worst day since March 2020.
 

BUSINESS

Truth Social deal could help a cash-strapped Trump

Donald Trump looks at his phone Alex Wong/Getty Images

The presumptive Republican presidential nominee, who’s on the hook for about half a billion dollars to cover a civil judgment against him, just got the green light on a Wall Street venture that could maybe net him six times the money he owes.

Yesterday, shareholders of shell company Digital World Acquisition Corp (DWAC) approved a two-and-a-half-year-old plan to merge with the private firm that owns Donald Trump’s social media platform, Truth Social, in order to take it public. As early as Monday morning, the product of this merger, Trump Media, will be trading on the Nasdaq under Trump’s initials, DJT.

Trump will have nearly 79 million shares (a ~60% stake) in the new company. That could be a windfall: Even though the stock fell 14% after the merger approval was announced, Trump’s shares would be worth nearly $3 billion at their ~$37 Friday closing price. But he’ll probably have to wait to cash out.

  • Trump can’t sell or borrow against any shares in Trump Media for six months, as is customary for big shareholders after companies go public.
  • But he could get around that rule if Trump Media’s new board of directors (which may include Donald Jr. and other friendlies, per CNBC) vote to let Trump sell early, even though that’s likely not in the company’s best interest since it could prompt a mass sell-off.

The stock may prove volatile. Many DWAC investors aren’t institutional or professional ones but small-time traders. The stock popped 140% this year thanks largely to individual Trump fans, who bought up shares as a show of support…not out of faith in the company’s success, according to the Wall Street Journal.

Meanwhile…New York Attorney General Letitia James might begin collecting on Trump’s $454 million civil fraud judgment on Monday, potentially by seizing his Westchester golf course and another property. Earlier this week his lawyers argued it was “impossible” for Trump to secure a bond to cover the judgment while he appeals, since no insurers would accept his real estate as collateral instead of cash. Trump claimed yesterday he had the cash but would rather spend it on his campaign.—ML

     

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WORLD

Tour de headlines

Law enforcement officers are seen deployed outside the burning Crocus City Hall concert hall following an ISIS attack STRINGER/AFP via Getty Images

At least 60 people were killed in an ISIS attack at a Moscow concert hall. More than 145 people were also wounded after armed attackers stormed Crocus City Hall yesterday, opened fire on the crowd, and set the concert venue complex ablaze with explosives, according to a Russian state news agency. The terrorist group claimed responsibility for the attack in a statement to its affiliated news agency, Amaq. Earlier this month, the US Embassy warned that an ISIS attack was “imminent” in Moscow after Russia said it had thwarted a planned attack on a synagogue.

Kate Middleton has cancer. Following intense speculation from the entire internet about her health and whereabouts ever since the Princess of Wales had abdominal surgery in January, Kensington Palace released a video yesterday in which she said her doctors had found cancer after the operation and she has begun a course of “preventative chemotherapy.” The princess did not specify what type of cancer, but said her family now needs “some time, space, and privacy.” The news comes as her father-in-law, King Charles III, is also undergoing treatment for cancer.

The US government can stay open. Congress passed a $1.2 trillion government funding package to keep the government from shutting down, but they did it with maximum chaos. First the House passed the bill, kicking it up to the Senate with just hours to spare. After the House passed the legislation, Rep. Marjorie Taylor Greene filed a motion to oust fellow Republican Rep. Mike Johnson from the Speaker of the House role but said the move was “more of a warning than a pink slip.” Then the Senate didn’t reach a deal to vote on the bill until the last possible moment as Republicans worked to force votes on controversial amendments, but the chamber finally passed it too—after the midnight deadline.

RETAIL

Nike’s losing market share to chunky dad shoes

Nike Air Jordan’s on shelves. Jay L. Clendenin/Getty Images

Nike is entering a rebuilding year. Despite better than expected sales last quarter, the company said this week that it’s getting pushed off its corner by competitors with websites full of throwback sneakers.

The sporty brand reported $12.4 billion in revenue in its fiscal Q3 2024, beating analysts’ projections of $12.3 billion. But Nike execs still feel like they’re getting lapped.

No one wants to rock Jordans anymore. Investors say the company got too comfortable relying on its heavy hitters, like its Air Jordan or Pegasus shoes. Air Jordan’s market share at Dick’s Sporting Goods has remained stable, at around 5% from October to February, but competitors like New Balance and upstart running shoe company On have seen their shares climb past the sportswear giant’s, according to YipitData.

  • Matt Friend, Nike’s CFO, told investors the brand will scale back its classic shoes and focus on new products, hopefully something to convert On and Hoka wearers.

Adidas marched on: Even with the Yeezy fiasco and the loss of its German national football team deal to Nike, Adidas’s retro Samba and Gazelle styles continue to sell like gangbusters. Though Adidas recently posted a rare annual loss, its shares have jumped 40% over the last year, while Nike’s have fallen 16%.—MM

     

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LUXURY

World’s most exclusive handbag is too exclusive: suit

Gilmore Girls GIF Gilmore Girls/Warner Bros. Television via Giphy

If you’re in line for a Birkin bag, stay in line.

Two shoppers (one of whom owns a Birkin) filed a proposed class action lawsuit against Hermès this week, accusing the company of violating antitrust law by “tying,” or linking the sale of one item—in this case, the iconic Birkin bag—to the sale of other items from the same business.

If you didn’t watch Sex and the City: A Birkin is the Daytona Rolex of handbags. One of these hand-crafted bags can cost anywhere between $10,000 and half a million dollars, and they are typically toted by people either as famous or as wealthy as a Kardashian. The whole point of a Birkin is that you can’t just pop into a store and buy one. You have to be invited to do so.

In the suit, the plaintiffs argue that Hermes unlawfully forced them to spend thousands of dollars on ancillary products like scarves, belts, and leather lipstick cases to gain access to a Birkin.

Big picture: While antitrust experts think it’s unlikely that the plaintiffs will prevail, the lawsuit could impact other luxury goods makers who employ similar strategies, like Rolex, Porsche, and Louis Vuitton.—CC

     

GRAB BAG

Key performance indicators

Jerry Seinfeld performing Theo Wargo/Getty Images

Stat: What’s the deal with syndication deals? If you’re comedian Jerry Seinfeld, you already know, because they helped build your fortune. According to Bloomberg, the ’90s icon of observational comedy and bright white sneakers has a net worth of more than $1 billion, thanks in large part to the ~$465 million he’s made off syndication deals for his eponymous sitcom. The $94 million he got from a streaming deal with Netflix and the $100 million he’s raked in from touring since the 1980s could also buy a lot of coffee at the diner.

Quote: “It’s a very interesting deal, and I like it.”

The sharks are circling TikTok. Well, at least one is: Kevin O’Leary, aka Mr. Wonderful, wants to buy the social media platform. But, just like on Shark Tank, he wants a bargain—CNBC reports he’s looking to offer $20 billion to $30 billion, which could be a 90% valuation drop from the company’s last funding round. Why does he think he should get it cheap? TikTok’s parent company, ByteDance, would be forced to sell it to a US buyer (or shut it down stateside) if the Senate passes a bill that’s already made it through the house. But O’Leary thinks the sale wouldn’t include the algorithms that make the FYP what it is, so the cash would be for the brand name and user base.

Read: How the US waged a global campaign against baby formula regulation. (Propublica)

NEWS

What else is brewing

  • Russia and China vetoed a US-backed resolution at the UN Security Council calling for an immediate ceasefire in Gaza, saying it didn’t go far enough.
  • Passengers on the Alaska Airlines flight that lost a door plug midflight received letters from the FBI saying they may be victims of a crime.
  • Rep. Mike Gallagher said he’d step down next month, cutting the Republican majority in the House down to a single vote.
  • Starbucks-branded holiday mugs were recalled because the metal-glazed mugs may cause burns or cuts.
  • Tennessee, the home of country music, is the first state to pass legislation to protect musicians from AI.

RECS

Saturday To-Do List graphic

Watch: Why a sunflower’s spirals match up with the Fibonacci sequence.

Bake: This recipe for hamantaschen tastes great whether you celebrate Purim or not.

Picture this: A visualization of the world’s biggest stock markets.

Look closer: How a recent scientific discovery almost got mistaken for bird poop.

With pleasure: Presenting MysteryVibe’s Crescendo 2, a doctor-recommended, FDA-registered vibrator. Clinically proven to improve arousal and alleviate dryness, it bends to your needs and even wins awards. Here’s 20% off—you’re welcome.*

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GAMES

The puzzle section

Brew crossword: The very first clue in today’s crossword is about FTX founder ___ Bankman-Fried, and it only gets spicier from there. Solve the puzzle here.

Open House

Welcome to Open House, the only newsletter section that knows way down yonder on the Chattahoochee...sits the spookiest home. We’ll give you a few facts about a listing and you try to guess the price.

Georgia replica of Haunted Mansion in Disneyland house.Remax

Today’s home is in Duluth, GA, and is a replica of Disneyland’s Haunted Mansion that you don’t have to wait in line to enter. The house was originally built by a Disney contractor who included a few ghostly special effects (unsure if that adds to the property value or not). Amenities include:

  • 6 beds, 5.5 baths
  • Two floors of covered porches
  • Massive shoe storage, perfect for lost soles

How much for the not-so haunted clone?

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ANSWER

$2.2 million

Word of the Day

Today’s Word of the Day is: eponymous, meaning “named after a particular person.” We’d like to thank Mickey from Gainesville, Texas, by name for the suggestion. Submit another Word of the Day here.

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