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MARKETS

• U.S. economy: Biiiiig day. The Fed is expected to announce its third interest rate cut since July, plus the Commerce Department will release its GDP growth estimate for the third quarter.
• World: Lebanon’s Prime Minister Saad Hariri announced his resignation yesterday. The country’s been rocked by protests for the past two weeks.

ENERGY

Murray Goes Underground

The largest privately held coal company in the U.S. declared bankruptcy yesterday, the eighth coal casualty in the last 12 months.

In its filing, Murray Energy Corp. pointed to reduced demand, competition from cheaper imports, and the rapid spread of renewables.

• On that demand note...U.S. coal consumption is at a 40-year low. Since 2010, around 270 coal plants have or have made plans to shut down, according to the Sierra Club.
• Last year, Trump administration officials dashed plans to bail out closing coal and nuclear plants. Some of those plants were Murray Energy customers.

Up next: Lenders agreed to hold 60% of a $1.7 billion loan. As Murray Energy reorganizes, it’ll have $350 million to keep the lights on.

The OG Murray

Founder and CEO Robert Murray was working in coal mines before he started enjoying broccoli. He founded Murray Energy in 1988, then grew it into the largest underground U.S. coal mining company.

He’s been a prominent industry voice in President Trump's administration. Murray was a major Trump donor, and his action plan may have informed some of the administration’s environmental policies, including pulling out of the Paris climate accord and rolling back Obama-era clean energy rules.

But even as he succeeded in turning Trump’s attention to coal workers, Murray acknowledged that most coal jobs lost in recent years aren’t coming back.

Because...

In 2008, coal accounted for almost half of U.S. electricity generation, according to the EIA. 11 years later, that’s fallen to an estimated 25% and is expected to sink further.

That leaves utilities two options: continue with natural gas or pivot to renewables. Natural gas has been favored for its reliability and low prices; at least 150 new plants are on the docket in the coming years. But renewables are on a steady climb and in 2018 provided almost 18% of U.S. electricity generation.

AVIATION

Lawmakers Lash Boeing CEO

Boeing CEO Dennis Muilenburg faced intense questioning from the Senate Commerce Committee yesterday over two Boeing 737 Max crashes that killed 346 passengers.

“On behalf of myself and the Boeing company, we are sorry—deeply sorry,” Muilenburg said to victims’ families, some of whom were in the room.

Senators focused on the company’s failure to properly alert pilots about issues with the automated flight control system known as MCAS (malfunctions related to MCAS have been linked to both crashes).

• Sen. Richard Blumenthal: “Those pilots never had a chance...they were in flying coffins as the result of Boeing deciding it was going to conceal MCAS from the pilots.”
• Sen. Roger Wicker: “Both of these accidents were entirely preventable.”

Looking ahead...Muilenburg and other Boeing execs have one more day of testimony, this time before the House Transportation Committee today.

SPORTS

Amateur Hour May Be Over at the NCAA

Yesterday, the NCAA’s Board of Governors voted unanimously to do...something.

Sorry for the vagueness, it’s not our fault. We do know they voted to eventually allow college athletes to profit off their names, images, and likenesses.

But there’s a lot we don’t know, like when they’ll draft a new policy or what it might look like. But it’s up to the association’s three divisions to make changes by January 2021.

Zoom out: The NCAA’s under meeting-the-in-laws pressure to loosen its ironclad amateurism rules for student athletes.

• Last month, California Gov. Gavin Newsom signed a bill barring schools from punishing athletes who monetize their player brands. Several other states and members of Congress are looking at similar measures.
• Plus, a series of lawsuits targeting the association’s limit on the full cost of scholarships is winding through the legal system.

A few numbers for the road: The NCAA’s revenues topped $1 billion in the fiscal year ended Aug. 31, 2018, and it says it represents 450,000 students around the country. Things may look different for some of them in the coming years.

+ Pop quiz: What year was the NCAA formed? Answer at bottom of the newsletter.

DEFENSE

Please Don't Scratch These F-35's

Yesterday, the Pentagon announced an agreement with Lockheed Martin to re-up its collection of next-generation F-35 jets.

• It’ll pay $34 billion for 478 jets, the largest deal yet for the F-35.

Why each jet is worth more than 23 Maseratis: The F-35 avoids enemy eyes better than James Potter's invisibility cloak. While it's faced many problems in development, the plane is expected to become the go-to fighter jet for both the U.S. and its allies.

• Lockheed and the Department of Defense have been haggling over the price for years. A spokesperson for the department said the two sides got the cost down 12.7% on average.
• Lockheed stock has increased over 40% this year, almost double the S&P’s gain.

The (geopolitical) backstory: The U.S. kicked Turkey out of the F-35 program in July because Turkey decided to buy a Russian missile system. The Pentagon was worried the Kremlin would find a way to access the F-35’s specs.

TECH

We’re About to Rock Your World With Smartphone Stats

About one-fifth of third graders own smartphones, according to a Common Sense survey. By the time tweens graduate to teen, nearly three-quarters have one.

We're just getting started

The average tween (ages 8–12) looks at a screen roughly 4.75 hours a day and the average teen, ~7.4 hours. That’s not counting homework/school.

You’re probably grumbling..."darned kids on Tick Talk all day." But social media time has actually stagnated. Gaming (22%), TV/videos (39%), and Morning Brew (254%) account for the bulk of teens' media consumption.

• Most of that's YouTube, which 53% of 8–12 year olds use the most. Ironic, because 13 is technically the platform's cutoff age.
• Relative to 2015, time spent watching online videos is up 124% for tweens and 68% for teens.

Big picture: Kids are ditching "traditional" TV for streaming services. More Gen Z-ers online should be good news for advertisers and streamers...but tailoring service to young users can also land you in trouble. Just ask YouTube.

WHAT ELSE IS BREWING

• Grubhub shares tanked over 43% following an alarming earnings report late Monday.
• Beyond Meat stock also had a terrible day, falling more than 22%. Not a coincidence: A restriction on selling stock lifted yesterday.
• Facebook sued NSO Group, an Israeli cybersurveillance firm, for allegedly spying on journalists, activists, and others using WhatsApp.
• Sony is shutting down PlayStation Vue, its live TV streaming service.
• Johnson & Johnson said it found no signs of asbestos in additional tests of its baby powder.
• Saudi Aramco will offer some of its shares publicly starting in Dec., a state-run news outlet reported.

FOR THE GRAM

See if spotting the errors or grammatical mistakes in these sentences from the WSJ editors gets your blood pressure pumping.

1. It now is home to an orthopedic surgical-tools company.
2. The study compared the records of men who had at least one testosterone injection with 19,065 nontestosterone users.
3. A Houston-based philanthropist couple is adding their financial firepower to efforts to make prescription drugs more affordable in the U.S.
4. Judging from Dorothy’s current record, doctors lobotomized her in the late 1940s, the heyday of the lobotomy program at Tuscaloosa and some 50 other veterans hospitals.

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Breakroom Answers


FOR THE GRAM ANSWERS
1. The company in reference isn’t an orthopedic company that produces surgical tools, but a company that produces orthopedic surgical tools. A hyphen between “orthopedic” and “surgical” should clear this up, or rewording.
2. “Nontestosterone users” should be “nonusers of testosterone.”
3. A couple can be plural or singular, depending on the context. But in this sentence, “couple is” and “their” mixes the singular/plural uses.
4. “Heyday” is normally used to indicate a period of great success or vigor. In this case, “peak” might be a better word choice.

Pop quiz answer: The NCAA was formed in 1906.