Facebook uprising

MARKETS

  • Economy: Manufacturing rebounded in May, according to the Institute for Supply Management. The sector is still in a state of contraction (getting smaller), but the new data shows that factories have restarted their assembly lines following COVID-19 shutdowns.
  • More economy: The Congressional Budget Office said the coronavirus will probably wipe out $7.9 trillion from the economy over the next decade.

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SOCIAL MEDIA

Facebook Employees Log Off

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It's time to add "virtual walkout" to your list of "phrases I never used until 2020." Yesterday, some Facebook employees refused to report to work in a coordinated protest against CEO Mark Zuckerburg's position on the company's role as a fact checking body.

  • Ryan Freitas, head of design for Facebook's News Feed, called out his boss in a tweet: "Mark is wrong, and I will endeavor in the loudest possible way to change his mind."

Zoom out: Once again, social media has been the talk of social media after President Trump posted an identical message to FB and Twitter on Friday that appeared to threaten violence against protestors who were looting.

  • Twitter responded by hiding the Tweet and labeling it as "glorifying violence," but did not take it down from the platform.
  • Facebook responded by doing nothing. It left the post up without any commentary.

Now Zuck's in the hot seat

He took to Facebook to defend his position in two lengthy posts.

  • On Friday, he distanced himself from the president's remarks but didn't go as far as to say he would take action. "I disagree strongly with how the President spoke about this, but I believe people should be able to see this for themselves," he wrote.
  • Then late on Sunday, he pledged that Facebook will donate $10 million to various racial justice groups following the killing of George Floyd--a gesture that seems to have done little to assuage his internal critics.

Unlike Twitter boss Jack Dorsey, Zuckerberg has maintained the philosophy that his company should not arbitrate political speech. But this walkout from FB employees, including some senior figures, is the most credible threat to that line of thinking in years.

Bottom line: Tech employees have proven many times they are a powerful force for change. And FB's workers, scattered as they are, are demonstrating that even a pandemic can't stop them from mobilizing.

RETAIL

We're Closed--Again

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Just weeks after welcoming customers back following pandemic-induced closures, some restaurants and stores have closed their doors again. This time, they're worried about damage and theft.

In the last few days...

From NYC's SoHo to LA's Grove mall, retail storefronts have been damaged and, at times, looted. Widespread riots led Philadelphia's mayor to order all retailers to close Sunday afternoon.

Chain reactions: Walmart is closing several hundred stores as a precaution. Amazon has adjusted delivery routes and operations in some areas. Adidas and Nordstrom temporarily closed all U.S. stores. Target, the subject of several widely publicized lootings, also closed or shortened hours at ~200 locations.

  • Some retailers, including Nordstrom, Target, and Nike, have focused their responses on the reasons behind the protest (police brutality and racial inequality) instead of damage to their stores, Retail Dive reports.

Big picture: It's easier for national chains to swallow the costs associated with closed locations, lost merchandise, and repairs. But in some cities, smaller businesses already struggling after three months of a pandemic have suffered the bulk of the damage.

HOSPITALITY

Break Out the Rewards Points

Consultants may not have to wait long to fall back into the 400 thread-count embrace of St. Regis sheets. Arne Sorenson, CEO of parent company Marriott, said personal and business travel is picking back up in key markets.

  • In China, all of Marriott's hotels are open and occupancy is up to 40% from a February low of 7%.
  • In the U.S., its largest market, Marriott is also seeing a recovery, with occupancy back around 20%.

More promising signs for travel: U.S. downloads of the top online travel agency apps (including Airbnb, Expedia, and Hopper) have returned to pre-pandemic levels, according to Apptopia. And in China, app usage for top international hotels has also rebounded.

Big picture

Marriott said the pandemic has had a greater impact on its business "than 9/11 and the 2008 financial crisis, combined," and Sorenson doesn't expect a return to 2019's global occupancy rate of 71% for a few years.

He added that predictions of a fundamentally changed industry are overblown: "I don't think it will look that much different afterwards than it did before."

Not everyone agrees. Go deeper with our guide on how the travel industry could change.

SPORTS

Diamonds Aren't Forever

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Major League Baseball and its players' association are locked in labor discussions, and true to form, they're taking a reallllllly lonnnnng timmmme.

The backstory: You have as many wins as the Yankees right now. The 2020 MLB season has been put on hold by the coronavirus, and for more than three weeks players and owners have been discussing plans to start it back up.

But they're getting along about as well as Bryce Harper and haircuts. In March, the two sides agreed to "discuss in good faith the economic feasibility" of playing games without fans in attendance, which seems the most realistic scenario.

The latest: Yesterday, ESPN reported that as a last resort the league is discussing a much shorter season (in the neighborhood of 50 games), and paying players on a prorated salary based on the reduced number of games--the compensation structure players have been vouching for.

Zoom out: The two sides need to reach a deal, because a lost season would be devastating for not only millions of fans, but the long-term financial health of the league.

FOOD

When You Just Can't Find the Right Words...

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Can a veggie burger be impossible, incredible, and sensational at the same time? Kinda.

Yesterday, the District Court of The Hague in the Netherlands ruled that Nestle's plant-based Incredible Burger infringed on the trademarks of Impossible Foods, a U.S. startup that makes the plant-based Impossible Burger. The court said Nestle's product deliberately aimed to confuse consumers by imitating Impossible's name.

Following the decision, Nestle hit thesaurus.com to look for an "Incredible" replacement, skipping past Amazeballs Burger to land on...Sensational Burger. It'll rebrand the product across the EU while it appeals.

To the spin room we go...

  • Impossible Foods characterized it as a "David v. Goliath" decision, pitting the upstart Impossible against the world's biggest food company.
  • Nestle countered, "It is our belief that anyone should be able to use descriptive terms such as 'incredible' that explain the qualities of a product."

What's the incredible Morning Brew's takeaway? This is a big victory for Impossible Foods as it awaits approval to enter the European market. Rival Beyond Meat is already in supermarkets there.

+ Flash poll: What should Nestle have named its burger?

WHAT ELSE IS BREWING

  • An independent autopsy found that George Floyd died from asphyxiation and his death was a homicide.
  • Sony postponed its PlayStation 5 event this week, saying it wants to "stand back and allow more important voices to be heard."
  • ViacomCBS networks including MTV aired nearly nine minutes of breathing sounds accompanying a screen that read "I can't breathe" in tribute to George Floyd.
  • Zynga is buying the Turkish mobile game maker Peak Games for $1.8 billion, its biggest acquisition ever.
  • U.S. public companies took advantage of the recent stock market rally and sold a record $60+ billion in shares last month.

TICKER TRIVIA

We haven't quizzed you about stock tickers recently, so like your dentist appointment, we're way past due.

How this works: We'll give you the letters of a company's name with its stock symbol letters removed. The remaining letters will be in order, and we'll also give you the sector as a hint. One example:

  • Media: E T I = Netflix (stock ticker: NFLX)

Here we goooo...

  1. Apparel: I
  2. Retail: A L A R
  3. Auto: E
  4. Fitness: E L O
  5. Tech: A E
  6. Also tech: none (stock ticker is name of company. There are multiple answers)

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TICKER TRIVIA ANSWER


1. Nike (Ticker: NKE)
2. Walmart (WMT)
3. Tesla (TSLA)
4. Peloton (PTON)
5. Oracle (ORCL)
6. IBM is one answer, what else you got?

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Jun 2, 2020
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