🍪 Who’s having a rough week? Elon, inflation, and the euro

Good morning! This is Bite Sized Beta, where we tell you everything you need to know in tech faster than you can say “inflation.”

It’s been a wild week… let’s see what's cooking.

In the oven this week:

• 🚨 Inflation hits a 40 year high

• 🤦🏽‍♂️ Elon’s terrible, no good, very bad week 

• 🍪 5 cookie crumbs

• 😂 Snickerdoodles: memes to save the day

INFLATION HITS A 40 YEAR HIGH

We thought May’s inflation numbers looked bad, but then June said “hold my beer” and took it to another level.

Inflation numbers came out yesterday, and it's not looking good. We knew it was gonna be bad, but not this bad. Inflation reached 9.1% in June, meaning things are on average 9.1% more expensive this June compared to last June. 

Just look at these prices increases over the last year: 

• Airfare: +42%

• Coffee: +16% (No wonder my damn latte yesterday was $8) 

• Gas: +60%

• Eggs: +33%

• Butter: +22%

• Chicken: +18% (Don’t worry.. our trusty Costco rotisserie chicken is still holding the line!!!!)

What does this mean for us? 

Well, the Fed’s mandate is to keep both inflation and unemployment low. Usually, unemployment and inflation have an inverse relationship, so when inflation is high, unemployment is low, and when inflation is low, unemployment tends to be high. 

The thing is… unemployment is lookin' GREAT. June’s unemployment rate stayed at a 50 year low of 3.6% for the fourth month in a row. We’ve recovered all the private sector jobs lost to the pandemic in 2 years (vs the 5 year recovery from the 2008 recession).

So economists are speculating that with unemployment at bay, the Fed will raise interest rates more aggressively to curb inflation.

And what happens when interest rates go up?

The entire economy gets hit - stocks, real estate, you name it. And tech stocks get hit the hardest. 

It also doesn’t help knowing that 8 out of the last 9 times the Fed raised interest rates to fix inflation, we ended up in a recession.

Buckle up, guys …we’re about to get poorer.

ELON'S TERRIBLE, NO GOOD, VERY BAD WEEK

It’s a good week not to be Elon Musk. I swear, the guy needs his own reality show. Just look at him:

LOL if that side eye isn’t reality TV material, I don’t know what is.

Alright, let's review the play-by-play of Elon’s rough week:

1. It all starts when news breaks that he secretly fathered twins with a direct report from his company, Neuralink. If that wasn’t bad enough, it turns out the twins were born within weeks of his son being born with then-girlfriend Grimes. 

Gulp. Alright, not a good look, but he laughs it off:

2. His current girlfriend breaks up with him over all the drama. Understandable.

3. By mid-week, he decides he doesn’t actually wanna spend $44 billion to buy Twitter anymore. He says Twitter didn’t provide adequate enough info on what % of Twitter accounts are bots. (Valid concern, but probably should have thought of that before ya signed the merger agreement, buddy.)

4. Twitter sues him in a 241 page complaint, trying to get the courts to enforce the purchase agreement. 

According to the original terms, Elon needs to pay a $1 billion breakup fee if he walks away from the deal. The hilarious part is that the $1 billion would represent more in net income for Twitter than it has made in its lifetime as a company. 

If this goes to trial, it won’t be until at least September.

5. Closing the week, Donald Trump gets in on the fun and amps up his rampage against Musk. He called Musk a “bullshit artist” at a rally in Alaska this week and the two have been sparring on social media ever since. 

Comically, Trump is still banned from Twitter, so while Elon tweets, he’s been firing back on his own social network, Truth Social.

What a disaster. 

COOKIE CRUMBS

• 📸 Instagram is testing a creator marketplace where brands can reach out to creators about partnerships/campaigns. Really smart move. Creators tend to go where the money is.

• 🧪 Sunny Balwani (Theranos COO + ex-BF to CEO Elizabeth Holmes) is found guilty on 12 criminal charges of fraud. Why’d he get 8 more counts than Holmes? Well, for starters, the jury was presented a text from Balwani to Holmes that read, “I am responsible for everything at Theranos.” LOL shot yourself in the foot there, brotha. 

• 👀 Andy Jassey hits his 1 year anniversary as Amazon CEO, just as Amazon has its weakest quarterly revenue growth since 2001 and its first quarterly loss since 2015. Poor management or just the economy? ¯\_(ツ)_/¯ 

• 📝 After a decade, Ev Williams (Twitter co-founder) is stepping down as CEO of Medium. The company has had a tough go at finding the right business model and attracting creators, especially with Substack and others competing in the wings. We made our first internet dollar ever on Medium though, so hey, shoutout to Medium!

• 💶 For the first time in 20 years, the dollar is at parity with the euro. Pack your bags, people, WE’RE GOIN’ TO EUROPE!

SNICKERDOODLES

Alright alright, enough bagging on Elon for now.

That's all for this week! 

P.S. We’ve been loving the feedback, keep it rollin’! Some highlights from last week:

We love to surprise ^

What'd you think about this email?

• 🍪🍪🍪 Top notch!

• 🍪🍪 Meh... could use more milk

• 🍪 Undercooked, do better