Business Pants – 2022-07-11

Hello. Oh good. I woke up. Emma live from nowhere near Texas. It's a magical Monday edition of business pants. Join us always by Emma lurk lurk lurking. That's your The Bronx Zoo call them and that's your new panda named lurk lurk. Do you know that? Oh vaguely. Know problematic there potentially house that problematic. Not sure Hills racist. What, how dare you? How dare all of you? I'm just saying I didn't say it is racist. I said there's a black and white anyways. So how do you even attach what side are you on here? Look, I don't I I don't disagree with the politics of Panda's and that's Matt ESG, Ms. Cardi, I'm ineffective Pace, you know, that pace, that just like, it doesn't matter how much you use just makes the paper soggy and not sticky. That's me. It doesn't actually everything slide off of it. Today is balloon shaped bag of allergy stuffed nuggets, called July 11th 2022, sexy story, update, sleazy academic, papers, and Emma's, trendy dumpster dive. Oh yeah. Oh, wait, am I dumpster you did? We didn't check in on your Trend stories. You're, you're doing your back to your nefarious ways where you You slip in stories at the end? You sneak in your stories obviously. Yeah, clearly can't. Keep got to keep you on your toes. All right, larc larc. This is gonna be a thing forever. All right. Unfortunately, we got to start with Twitter. oh, I don't, I mean, let's just do it musk and form Twitter. He is terminating the deal to acquire the company. I think this was what over the weekend, Friday? Oh, it was a late Friday, wasn't it? Yeah. It was, yeah. It was Twitter saying that they are intending to take musk to court to force him to buy the company for 44 billion dollars. So let the awkwardness begin. That's like I'm breaking up with you. Oh no, you're not. Yeah exactly. So this was the best way to think of handling. The story I found eight different plausible. Scenarios how this could end and I'm just going to go over the one by one and you guys can either. Say something, or you can just tell me I'm it's boring and move on. Okay, can we pick how the board votes on each one of these scenarios that's gonna be a lengthy show if you really want to do that? Go ahead for all you have the USG expert in the room. So go ahead. Here's the first one. Deal and musk pays the breakup. If you don't forget, there's a 1 billion dollar brick of feed. I mean, just think how simple and tidy that could be any chance we get and we're gonna get there. No? What? No chance. It proving that he's not a nice man. Because really like, that's, I just feel like with all the aggravation all the time, he's gonna lose on this. All the Tesla stock price is gonna continue to go down because they're like, what the hell is he doing? He might actually save himself a boatload of money. Just by the Tesla stock. If he just very graciously bows out and pays the fee, right? I I swear I'm right about this. Uh, well, maybe about, but I the Tesla stock is down less than the Twitter stock. Right? Good. So Yeah, that's good news for nobody's winning. All right, so you guys are saying no to that one, right? Yeah, yeah, there's no way the board actually. There's a binary decision that in the courts, right? Like musk makes a billion or must pays a billion or must pays 44 billion in the courts, right? That's pretty much it. And the board is gonna be like, pay us to 44 billion so that we can stop being the board. There's an interesting wrinkle to this is that the board might not be allowed to let him just walk away, right? Because they might actually have to seek this deal because it because it's their future duty to take care of the shareholders. But I've never loved the words for nobody wants to hear me. Say that. Okay, Moving on but this one How about Twitter just winning in court and must cast it by the company. And there is some president, here all be it back to 2001 where they forced Tyson Foods to buy some big beefy company. They try to they try to back out and they're like, no, you gotta buy the beat? How'd that work out for Tyson? Well I think it's going pretty well is it not? I think they gave everyone covid. Oh, Yeah, I think that actually this is the fun part. Think about this like being a Twitter employee or executive and you're forcing and you're forcing an owner who doesn't love you anymore? To be your daddy. Can you imagine actually being Egon Durban? Who was forced by the board of Twitter to stay on the board of Twitter. Okay, well, this You think that like if he wanted to resign after the shareholders voted him out, he couldn't even do it. He handed in his resignation in the board rejected, his resignation, listen to the rejection and then he was like, he didn't go back, he could have gone back and said guys I really don't want to be here. And they hate me, everyone's unhappy and and David rosenblatt and Brett, Taylor were like, look, you staying to see this thing through now because this is your fault. Well, you put Twitter and play with your stupid activism before. Your fault. Now you're staying until it's done. And now done, looks like they have to fight in court for 44 billion dollars. Well, think about it. There's actually one of musk's children is also suing him to break up, right? What if the court forces that like forces musk to be the daddy in the, in the kid has to write like so this is kind of the same thing, is it not? It's exactly. That's exactly. You it's it's parental rights, okay? The other number three, Twitter wins and Court musk pays damages. I think that's the only I'm not that one. Yeah, go ahead. No, well there's there. The court can't actually say 1 billion is not enough. The court say something about something called specific performance. Oh and specific performance is Twitter is actually worth 25 billion dollars. You offered 40 billion dollars, you have to pay the difference, right? And that would be specific performance as the settlement. So the camera in, they can, but only, if Twitter has another buyer who's willing to pay 25 billion dollars, 20 billion dollars. Well, not gonna happen between the three of us. She her panda. Then I asked her if she would chip in her new Volkswagen electric vehicle for the purchase of Twitter about said no about musk agrees to settled with Twitter. And in this case, he would pay the fee and billions more in a brokerage settlement. I mean, that's not gonna happen. What is that? That is the, that is the possibility, but if your musk, there's no way. You can, like in a trumpian way, you can't afford to look like you lost, right? So he's settle. So he's so petulant and trumpy that instead of just offering to write the billion dollar check now, he'd rather go through the the mess of this with without he doesn't want to look like he screwed up. Is that what you're saying? Yeah. Well doesn't his whole Cult of Personality sort, of rely on like Elon Supremacy at all times, like all of his fans are like Elon doesn't lose, so he can't lose for his family. Yeah, I think you're right, I mean, did you see the he his Twitter post today was a bunch of memes of him like laughing. And so that, yeah, really gotcha. What is the cold down? I don't even get what they're really, what are they worshiping at this point? Just like a child. I don't understand. I don't really, I guess I'm kind of lost on me. Yep. Were we trolling? Exactly all. So who we laughing at looks like he was laughing at himself. Like look, I'm a big idiot. Yeah, he's he is tweeting on Twitter, a joke about the fact that he's trolling Twitter, and not buying Twitter, after saying, you want to buy Twitter, he can't go on a tree, can't go on a truth social, because he doesn't like Trump anymore. So the Santa will not social media company, Maybe. Through social is investigated by the feds for illegally, raising money and giving. So that's probably gonna get half shut down. I think what Emma is saying is that DeSantis and Joe Rogan need to start a new social media company, right? Yeah, that is exactly what I said, I think. Yeah, that right. Okay. Number six. This is highly plausible musk changes his mind again, right? I mean, yeah. This one I'm I'm with this one, right? Yeah, because remember, he remember, he promised I think in an SEC filing in a letter that was attached to seeing that. He was not going to play any game. But clearly, this is all a big game, so, you're right. I'm a, there's another shoe to drop. I love how the, the press, the business news, and the regular press every time. There's another statement in the story, they think that it's over like this is what this must be true. But I do have a conspiracy theory that suggests that somewhere, Jack Dorsey and Elon Musk are just there together making this game. Like okay, let's talk about it. So what, so, how does this help Dorsey? I mean, what why would Dorsey want this? What, why wouldn't he want? How does he make, you think you think musk is offering him like a check? Because it doesn't Dorsey have a considerable shareholding? Yeah, but but I mean these are billionaires like right there, you lost three billion today. Like okay, I got 400 more. Okay cares. Um, but like I can imagine a situation in which they're having barbecue at Elon seventh kids house like and And Jack is there and saying like, you know, they're not telling you everything because Jack is pissed his bored and he says something like, like, check the Bots. Trust me, check the box. And then Elon goes, and he's like, this is the perfect pretense to get out of this, or to lower the price if I can. And now I've got like, Insider saying it. But you can't say that an illegal filing, right? Like Jack said, the Bots aren't there. Yeah. But that's exactly what cronyism is and Jack was all behind like he was on the board in April, when the the deal got approved when it was on said, I want to buy it. Yeah. When it was like, Jack was there for all of that? We, there's good evidence that Jack was sort of like a power broker to bring these two together, to clearly. Then I had a parting shot at his own board and X, you know, compatriot Prague on the way out. It's sort of would make some sense to me in a conspiratorial way. And yeah, and two points. so Jack Dorsey currently owned 18 million shares of Twitter which is considerable amount, but You know, if he's only saving 10 dollars a share that's only a hundred and eighty million dollars, he's losing, that's not anything to him. It's nothing, it's nothing it's two. What is a barbecue with Elon Musk? Like because isn't Jack Dorsey isn't he plant-based only wouldn't Elon just be ridiculing him for for eating plant based foods. What is what's the tone there? I'm confused. Does ELO not like plant-based people. Is that a thing? Don't you get the feeling that? That's not very manly. Emma. Yeah, but it's in direct contrast with the whole Tesla environment message, which I understand has not. Necessarily been consistent with his savior, the Earth messaging and actions. But, you know, shiting on vegetarians and vegans as the CEO of Tesla looks pretty bad. Yeah, let me tell you that. That shit ain't great because it's like a lot of hamburger in there. There's a lot of gristle. It's terrible, really, it's terrible. All right. Number seven. And this is part of the game musk and Twitter agreed to a lower price. Could that happen? Is that yeah, that's That's possible. Emma, Emma says, I mean No, but that's possible. But That must just you're saying no because you don't think musk wants it at all right. No yeah you don't I actually think this is a game just to lower the price. I think you still wants it or it can't afford it or he can't afford it. all right, it I like I like the honesty there. Oh saying I don't know is a sign of wisdom Emma because you know what? The three of us. We don't know anything and finally a white knight buys Twitter. I don't I don't really like the way that sounds CNBC. Oh white know what but do is there. Anyone who could buy this who's who's coming in? Who wants it? Microsoft. Oh, interesting, interesting. I like it. I use that you just make that up who's on the outside. Looking in, on most of the social media Universe, right? Like Microsoft has LinkedIn that like seven people use including us, which is not. Are you suggesting? I thought LinkedIn was a powerful entity. Oh, you're scarf. Linkedin's got like eight users. Let's go. Come on. But I don't have. They all master's degree? They gave us like a live stream on LinkedIn. That's how few users there. Are there. Okay, I didn't realize. That's But I think like Microsoft if Activision Activision acquisition is going to the courts in the EU to see if it's an antitrust and the US passed it because it doesn't make sense that it's Anti-Trust. But in the EU, everything's fair game, like they could just be like you can't own this right? And which case, if you're out of the Activision deal and you decide like, oh man, I can't deal with Bobby kotick anyway and his college of Cosby sweater. You're sitting on a bunch of cash that you devoted Over There. Imagine if you're sitting there thinking to yourself, What's something else we could buy and immediately be useful? The you could buy Twitter. Yeah. And you could give it to the Skype team because they've been bored for a long time. You know what would be even funny or Is if Tesla bought Twitter and not you and Kimball musk became CEO of him. I had to approve that. Okay, so before we, before we wrap up on Twitter today, what do you think's gonna happen? Give me. Give me a prediction. Somebody. You can, you can have a joint prediction if you want. I don't care. Somebody had Emma Emma happen. Emma. Emma knows. Emma Watson, Saturday Night Live. She knows things. Oh barely watches Saturday Night Live and Emma also definitely doesn't know by I think. I don't know, I think that this whole thing was sort of embarrassing for Twitter. I don't know. I think that whatever is going to happen is going to be Saving Face from Twitter as opposed to like, The financially smart decision, the like, I don't know, I just think it was all super embarrassing and I think that they're going to try to get him to buy it at whatever cost necessary. But I sort of don't think it's gonna happen because we know Prague doesn't want to run this company. So you might be right? They might just be the play. It's like, force this jerk. You know that no the perils here with the with the the January 6th Insurrection, the big lie or kind of alarming to me, right? Because he's leaning on this strange. I'm getting out of this deal because they're not giving me the the information. They're not giving me the line, right? Like they're lying about something, but he's not proving their lying. Know that was, that was my favorite part about the letter. If you haven't read the letter, people read. Why I did the letter? Because it's fantastic gaslighting. Yeah, in which Elon Musk goes through. And says, I've asked for the date, I asked for the data, they won't give me the data. There's not enough data, I asked them for this. They gave me some of it, but not all of it, the data, the data, the data, there's too many Bots, that's my suspicion and they won't give me the data to prove it, efficient next, next section, The data that I did get suggests, there's too many Bots, right? Like where he basically says I don't have the data to do that and then the next section says, but I think there's too many bots on what they gave me, well, do they give you the data to suggest something or not, like, you just spent three paragraphs saying that they didn't give you the data the next section. After that says, you promise, that you would give me a whole bunch of stuff including the they said we asked for Goldman, Sachs is valuation of Twitter. And you didn't give us the working copy, you gave us a PDF that is legitimately a sentence in there. Saying you gave us what we asked for, but you gave us as a PDF. I'm not working. I hate getting very disappointed, I hate it. I hate media. We didn't give us what we asked for because we asked for working copying. You gave us PDF. Yeah. And then the final section is where he says. We also said that you would maintain your operations. But you fired, two fired, a dog. You fired dug two Executives, we're very pissed that you fired. Those two Executives and all so PS. A bunch of people quit without mentioning the fact that they quit because Elon Musk. Well was buying the company Dimension. That first of all, it's common. It's common procedure to like, let go of Executives insurance or to have hiring freezes before your acquired second of all. It happened in May in early May and we've heard nothing. We haven't heard Elon complain about us and we know like the talk. So the market is tanked and Elon Musk is talked over and over again, on how the market is really terrible. He said, it's like really sucky. It's really bad, it's really bad and they had a hiring for, it's, it's bananas. Here's my prediction. Okay. Brett Taylor becomes the co-host CEO of Twitter like with Prague liking. This cocoa board is a is so upset at Prague for not showing enough leadership that they asked the chair, Brett Taylor to act as co-ceo with Prague. So he's the co-ceo itself force and Coast CEO at Twitter, so he's a Coco CEO. I think Egon Durban hands. His resignation in again saying this is a total ship. Can you please stop making me a zombie directors? And fei-fei li who is according to our metrics. This board is very democratically dispersed in terms of influence and we don't know exactly who's driving this boat, but it's very Democratic right now and Faith, a lie announces that she has developed an AI and she's replacing the entire board. Otherwise with artificial intelligence, that's what I think is happening. All the only thing you miss is that the SCC penalizes, perog the CEO parag, and make somewhere a glitter helmet because they're upset that he didn't have any kind of effective power to kind of wrangle these idiots in the first. That's actually the one thing that you didn't put in your scenario's, which is the SEC helmet comes in and basically like finds Elon Musk out of enough money. You know, the deal with Twitter fishing, you said that I think and I think the New York Times hinted at this morning. I think they're suggesting The SEC is afraid to penalize someone like Elon Musk in fear that he just won't do it, and then it'll make the SEC look like idiots. Like we're back all trumped out next level. Yeah. Wow. I'm gonna, you know, I'm gonna pass, I feel like I've taken up a too big of a segment here. I have a great big story about Uber that broke in the guardian over the weekend. But I'm gonna say that for another tomorrow Wednesday or whatever, but stay tuned for a riveting reporting on Uber actually was good, Matt take it. All right, nerd alert. It is nerd alert Monday. If you get that feeling that your job is basically set up so that you serve your corporate overlords and their controlled by a cabal of secretive elitists. This nerd alert suggests you might be right, that's right. I I took a picture. I grabbed a snapshot of one of those elitists, Scott Davis, the chief investment officer of the Indiana Public. Retirement system looks like a secret kabbalist. But here is what's really happening. If Damien was stopped moving the damn, go ahead. Like I can't even do, you know, he's talking. Go ahead. I'll let the Nerds tell you. The paper is shareholder power in the decline of Labor. It's from May of this year. It's by Antonio falado Hyun siab. Kim, and til Von wachter. Oh, nice. Those are real. Yeah, here's the upshot from the paper. In economies, where institutions own high concentration of the companies, they found lower employment and wages economies words. Okay. All right, the paper uses Bureau of Labor Statistics data, it's confidential data actually and ownership data differentiating between different types of owners of Institutions, like activists and index owners Pension funds. Highly concentrated, yada yada here are the important takeaway takeaways. Quote. Increases in concentration of institutional or ownership, lower establishment employment, and payroll. While raising shareholder value without a parent increases in labor productivity, translation? When there are fewer large owners who own most of the market, they demand shareholder returns at the expense of your job people when they're. If it means that the attention funds that have concentrated, they own the entire Market, their massive institutional owners, BlackRock, Vanguard, they only entire Market and when they and Pension funds, when they own the entire Market amongst fewer and fewer people, They demand that companies give them Labor's share of returns. That's basically what they found is actually in a very nerdy Niche. Way pretty big news. It's it was an epic paper, it's really hard to get through because it's a lot of once again, that the Antiques Target should never be Black Rock. The not if they want to be anti-woke because black rock is effectively rent, extraction extraction from employees, to the investors. The idea that the anti woke through the right Republicans would go up to block Rock on the first place, is just laughable and so many levels, but go ahead. Keep going. I love it. It's fantastic. Here's another quote, quote, high Union coverage, which increases employee bargaining power. Mitigates the negative effect of powerful institutional owners on employment. Unions are one of the solutions. Yeah. For maintaining your level of wages and payroll really where institutions owned it all the time. I was working the sound effects board. Right now, I would do something that mocked you for saying something audio. It's the most obvious thing, right? It means unions actually. Do make him. Well, he's more money. This is why I'm going to continue this push. I'm the the loan person in this great ESG world that we live in and really, it is a fantastic World. Let me say, we got up, we got pools and Ferraris and hot tubs, but I am alone person on this ESG Island, who's pushing for? I want employee representation on us boards. Come on. Join join the fight with me. Come on, let's do it. Well, here's the thing, the the papers actually they're suggestion was one of your favorite things which is increased labor representation on board. Really just look at that know when I feel a buster their very thrilled with that, I'm Here you must be thrilled actually, for that. Being I mean, I know what seriously, but I actually do believe in this cause like this, this causes important Here's the downside. The side note from the paper, it turns out that dual-class companies are actually associated with higher wages because there's less concentrated institutional control, but did they did they figure that? Yes, they control for industry. Okay, well that I'm I can't say my, my ridiculous, I'm genius point about tech companies. Yeah, I know I had the same point in my head. Yeah. Um, but overall, look is a good thing like we used to do when we used to work for a S&P 500 company, let's just omit that part from the paper. We don't need to talk about that. Yeah, we don't talk about this is somewhere over there. Boys of the dollar store. Yes, you have been pissed. At Mike Witt niskey, who's the CEO of the dollar store? For basically putting you in rat feces, infected and fested, you know, distribution Center's, or paying you six cents in an hour and you know, working you 700 hours a week. He's the wrong target. The institutional owners are keeping you down. Vanguard BlackRock and a company called mantle Ridge which is a Bill Ackman activist Protege, they own the vast majority of your of the company. They're the ones who want to take your money. It's Scott Davis of Indiana pension fund. They're your overlord. Yeah, you're welcome. Hey, this is that's it. Matt, that was your best nerdler ever. I'm gonna go on record saying, and once again highlighting that? Why are you the only ones talking about ownership and direct open the Nerds, make a like a back us up. Thank you. Emma. All right, good luck, topping that because I Matt really his nerdom shine really brightly today. I really can't top that And for that reason, I will go quickly. It is your trendy dumpster dive. Yay. Number one, it is a prime day. And by that, I mean, Prime day is Tuesday and Wednesday because it is actually a two-day event. Okay? Days. Yes, that would be the more correct thing. And the only thing I have to say is this, I cooked on an article that happened to be on CNET and it is entitled as Prime day nears injured Amazon warehouse workers still get the runaround. So I read this lovely article. It told me about how Amazon warehouses have doubled the rate of injury of other American workhouses. They have seven injuries per 100 workers and a worker got injured on the job and then a doctor from Amazon told him that the injury was permanent. So he couldn't work. They couldn't find him another job. That would accommodate his disability, and he's stopped receiving his benefits. And then I read through all of this stuff, this great reporting. And then as I scrolled, the end of the article that headline from the next article said, 42, Amazon Prime Day deals under 25 dollars. Yeah, can I say one thing, Emma? Yeah. This, I don't know what it is about this year, but I'm actually seeing a lot of negative press about a lot. Of people, a lot of headlines are suggesting like it's not worth it. Like are these really good deals or they're really discounts what's happening, this is the effect of Andy jassy. There's you gotta have a bald supervillain to run your company because if you have a guy named Jesse, nobody's gonna care Well, it also doesn't help that Walmart decided on Prime day to announce its own private, Prime day. Yeah. What else? Oh now, apparently Christmas is in July. Thank you. All right, number two, we have sorry if I sorry about this name. Kyrgios wore a red cape Wimbledon. Here's why that's controversial. The reason it's controversial is because you're supposed to wear all white to Wimbledon. That's, that's it players, underwear color, like, they're intense about that. I think it's great. Yes, yes. I think it's only gotten stricter but like Andre Agassi has criticized it. Roger Federer has criticized it, but they are really doubling down on the white. I want my job after Matt fires me. The white is because I'm sweat was considered unseemly in the UK and white was the best hiding that so apparently you can't play a sport and look sweaty. So this led me down a rabbit hole of looking at Wimbledon which is run by the all England. Lawn tennis and croquet club which is private. Yeah a lot of croquet out of that club we're only seeing 10 is what's the deal? I want to see some. I would agree. Croquet gets ignored and I think that's unfair Damien. Yeah. Probably championed the croquet Cause And You Can't Sweat playing croquet so it solves another problem. Oh, beg to disagree on that one. Yeah, I don't know what version you're playing. Here's the things about the all England, lawn tennis and croquet Club men and women have only been receiving equal prize money, since 2007, they have 12 board directors. Three are women and they have a female CEO. Oh, and they have the longest running Sports sponsorship with their tennis, ball maker. Slazenger, that's a weird, which is a weird additional name. I don't know why you're in terrible name, female, I give them credit for that. Come on. And number three. Yeah, National 7-Eleven day. How to get a free slurpee? 711 90th birthday, I love it. How you do that is? You have to sign up to be a seven Rewards member or a Speedy Rewards member. Okay, you're losing me. And I looked into 7-Eleven which is actually owned by seven and I holding, which is a public Japanese company and they were the 15th, largest retailer in the world. As of 2018, they bought Speedway, which is another American convenience store, chain in 2001, three out of their 15 board members are women, which I believe her Japanese companies is actually not bad. Yes pretty good. And then finally our friend and activist investor Dan Loeb, managed house, the former CEO who was grooming his son to be his replacement in Dan Loeb said. Well not and yeah, he got voted down in a board standoff. And now Dan Lopez chose the CEO and he's currently in place. Well, that's another Hallmark of a lot of companies over there is. Yeah, grooming Sons to take over its, I mean, which is a joke. Emma like two weeks in a row. Has effectively told me that the most American things I can think of hot dogs and Slurpees are owned by a Chinese company, and a Japanese company. Correct. Correct. That that's mind blowing to me. So Americans, you're not. So American, just everywhere else is, let's be real. Is shoving sugar down your throat? Can we be real for a second before we wrap this up, since our childhoods? And, and I'm gonna pretend, we share the same childhood, or at least maybe we were like, right. 80% of it are BMX together somewhere and then we was born at 8292 since then, haven't the luster of 7-Eleven in hot dog kind of worn thin. Like they're kind of they're they're they're dipping their falling. Are you blaming Asia for that? Is what I'm really getting it. Are you blaming Asia? He's ruining the reputation of both seven eleven and hot dogs. Actually, I'm doing quite the opposite and saying that they haven't fallen at all. Okay. And Americans love their Slurpees in their hot dogs. Deeply leading into Asia. I'm waiting for the day to prove that before I buy your company. Yeah, that was a trendy, dumpster dive and a show, I guess, in which we talked about things and that's all we have to talk about. That's emelar King, Damien Rollins. I'm at Scotty, we are Freeport media, come back tomorrow, where we're gonna go over some Uber stuff, but also some other stuff and we'll talk to you then goodbye.