QUOTE OF THE DAY
“There cannot be a crisis next week. My schedule is already full” — U.S. diplomat Henry Kissinger. But the speaker isn’t important here. It’s where this quote is printed: the floor of Uber’s San Francisco office. The jokes write themselves these days.
MARKET CORNER
Market Snapshot
- Stocks lost momentum on Wednesday after the Federal Reserve said it would trim its $4.5 billion balance sheet, making investors cautious and causing treasury yields to rise
- Crude oil fell below its $51 milestone mark on the news that U.S. inventories might be higher than anticipated, which didn’t help markets or the dollar
Get Your Ad Together
That’s what consumers said to Pepsi (-0.12%) and Nivea this week after both brands released controversial commercials, but for very different reasons. Pepsi’s ad—released online late Tuesday—borrowed imagery from Black Lives Matter protests and featured Kendall Jenner casually handing a Pepsi to an officer. The Internet found this move way too casual given the severity of U.S. police brutality. Pepsi pulled the ad yesterday, saying it "did not intend to make light of any serious issue."
Nivea’s blunder, on the other hand, made Pepsi’s look pleasant. The German skincare maker proclaimed "white is purity" in its quickly-deleted Facebook promo. There’s really not much else we need to say here, other than that we’re glad it was pulled. Nivea said it immediately deleted the post "after realizing that the post is misleading."
So how can brands stay exciting without being insulting? Budweiser (-0.33%) figured it out earlier this year. Rather than aiming to be hyper-relevant with its annual Super Bowl ad buy, the beer maker questioned the very basic premise of what it means to be an American. In the ad, Adolphus Busch faces aggression, hostility and even a boat fire before finally reaching St. Louis and meeting Eberhard Anheuser. It’s hard to get mad at this accurate representation of the American dream…especially when it ends well. We’ll cheers to that.
Power and Parental Control: A Day in Amazon’s Life
The giant e-tailer will refund millions of accidental purchases by children, it said Wednesday. After a court ruled last year that Amazon (+0.27%) failed to inform parents that free apps can still include in-app purchases, Amazon called foul and appealed the decision. But now the Seattle-based company is backing down. Soon it will begin refunding customers for these purchases, which could total upwards of $70 million. Yikes.
But hump day wasn’t all bad for Amazon. News broke that it had also acquired the rights to buy nearly a quarter of fuel cell maker Plug Power (+73.08%). That’s not a typo. Investors were really happy. Why would an e-commerce company need fuel cells? For starters, Plug Power supplies batteries for forklifts used in distribution warehouses. It’s just another step in Amazon’s race against Walmart to control American retail.
Panera Officially Has a Buyer
JAB Holdings, which also owns Peet’s Coffee, will pay $7.5 billion for the St. Louis-based bread chain. Panera (+14.21%) has about 2,000 locations across the country and could solidify JAB’s entry into the fast-casual scene. Who is JAB? The turnaround king. JAB purchased donut chain Krispy Kreme and later Keurig—two industry leaders that have struggled in recent years. Panera might actually prove a difficult transition for JAB. As health trends continue to take hold across the country, competitors like McDonald’s and Starbucks are quickly redefining their approach to fast food. May the best bread win...
What Else Is Happening…
- YouTube enters the streaming wars with a $35 live television offering
- Payless Shoesource is the latest victim of American retail’s oversaturation
- Stun gun maker Taser is rebranding as Axon and will offer free body cameras to police
- Microsoft wants to help plan your social life with its new iMessage app
Economic Calendar
- Monday: Motor Vehicle Sales(-), PMI Manufacturing Index (-), Gallup US Consumer Spending Measure (+/-)
- Tuesday: Redbook (+);
- Wednesday: FOMC Minutes; Earnings: Bed Bath & Beyond(+), Monsanto (+), Walgreens Boots Alliance (-)
- Thursday: Fed Balance Sheet, Money Supply; Earnings: Neiman Marcus
- Friday: Employment, Baker Hughes Rig Count, Consumer Credit; Earnings: Cargill
WATER COOLER
Fast Food Chains Refuse to Give Up
Although Americans have started to turn their backs on the fast food industry, fast food restaurants continue to scratch and claw to find profits. With McDonald’s yearly global revenue at $6 billion, it’s understandable why these restaurants are staying optimistic. Here are some underdog stories from fast food places you’ve probably never heard of:
- Kenny Rogers Roasters is a rotisserie chicken chain started in the early 90’s that tried to capitalize on the iconic singer’s fame. After peaking at 300 stores in North America, the restaurant closed its last domestic location in 2011. However, in the same year, the company sold $100 million bucks of chicken in China and is set to grow even more with new locations in India.
- Chi-Chi’s, a Mexican restaurant chain, was nearly shut down in 2004 after its onions were found to contain hepatitis (yep, straight-up hepatitis). Chi-Chi’s managed a turnaround by opening successful locations in Belgium and Luxembourg and creating a grocery salsa brand.
- ShopHouse, Chipotle’s asian kitchen chain, proves that not all struggling chains are able to turn things around. It announced last month that it would be closing all 15 of its stores. Another one bites the dust...
THE BREAKROOM
Interview Question of the Day
What digit is the most frequent between the numbers one and 1,000 (inclusive)? Least frequent? (Answer)
Stat of the Day
1.8 million: that’s how many subscribers S-town—a new podcast from the makers of Serial and This American Life—was able to gain in just one week. Not too shabby...
