Stifel Bits

October 11, 2023

The Appetizer

“There is no [bedbug] resurgence, we must not fall into madness.”

  • Clément Beaune, France’s Transport Minister, amid a bedbug outbreak in Paris.

Now, on to the numbers. Drum roll, please …

  • 40: The number of years since the U.S. Strategic Petroleum Reserve last reached its current level of 372 million barrels.
  • 29 seconds: The decline in average total time spent in drive-thru lanes this year compared with 2022.
  • 17%: The proportion of customers who admitted to being “uncivil” in their interactions with businesses, according to the National Customer Rage Survey.
  • 2.2%: The decline in the price of pre-owned Rolex watches in September.
  • $6: The price of Girl Scout cookies this year in some places, up from $5 last year. Rising production and material costs are to blame.
  • 104: The age of a Chicago woman who recently skydived, likely to become certified by the Guinness World Records as the oldest person to have ever skydived.

Dig In

Algorithms are the secret sauce that power many of the digital experiences we rely on daily, running the show behind our search results, social media feeds, and navigation apps. Some companies guard these algorithms as closely as the Coca-Cola recipe.

Well, for Amazon the secret is out … Amazon “allegedly” used a secret algorithm named “Project Nessie,” yes, the same nickname as the Loch Ness Monster, to bring in an extra $1 billion in revenue. The algorithm would test how high Amazon could raise prices while keeping them lower than competitors or nudging them to follow suit. Now, Amazon is facing off with the Federal Trade Commission (FTC).

Basically, the FTC said Project Nessie is an “unfair method of competition” and the company’s power over third-party sellers on its website leads to higher prices for consumers.

Amazon insists it’s not using the algorithm anymore and claims the lawsuit is mischaracterizing the tool, saying it was a safeguard against prices sinking to unsustainable levels.

But hold on, Amazon is definitely not the only company accused of using algorithms in their favor. Take Cigna, for instance; it got sued for using algorithms to automatically deny claims. The list could go on and on, but you get the point.

Also, don’t think all algorithms are “bad.” In fact, we rely on them for countless beneficial applications, and they’re the backbone of one of our long-term investment themes, the Fourth Industrial Revolution.

Weekly Specials

Now this is something we haven’t seen recently … the average interest rate on a high-yield savings account has surpassed that of most mortgages. Approximately 80% of homeowners with a mortgage have an interest rate below 5%, and almost a quarter enjoy rates below 3%.

Have you ever returned from an overseas trip and wondered why your jeans feel looser? Apparently there’s a reason for it. During a European vacation, Americans tend to walk more and consume fewer ultra-processed foods. Americans take around 4,774 daily steps, while Spaniards walk 6,000 on average. Additionally, 56% of an average American’s calories come from processed foods, whereas Italians have just 12%. The takeaway? Book a trip to Europe if you want to shed some pounds.

Last week was “Fat Bear Week,” and we hope you got your votes in. Every October, the brown bears of Khatami National Park in Alaska battle it out for the ultimate winter fluffiness title. The bears compete in a bracket-style showdown to decide which one is best prepared for winter hibernation. Last year’s winner was Bear 747, weighing nearly 1,400 pounds. The 2023 winner is … Bear 128 Grazer!

Jerome Powell, Federal Reserve (Fed) Chairman and … social media influencer?! That’s right, your favorite central bank just joined Instagram – @federalreserveboard – to boost accessibility and availability of its educational content. Imagine having this resource during your high school days. We give it a couple of weeks until they disable comments on their posts.

Corporate Lunch

Uber will now pick up your packages and take them to UPS, FedEx, or USPS – service already offered by all three couriers.

Macy’s is thinking outside the big box to stimulate growth and plans to open 30 new small-format stores across suburban locations.

Meta plans to offer a $14 a month subscription for ad-free Instagram and Facebook. This tier allows users to avoid targeted ads in an effort to get on EU privacy regulators’ good sides.

Spotify is serious about becoming the destination for everything audio. First music, then podcasts, and now audiobooks. Paid subscribers will be able to listen up to 15 hours of audiobooks per month.

Moody’s Analytics found the presence of a Cheesecake Factory restaurant in a mall is an indicator of the mall’s financial health. Call it the cheesecake factor.

Brace yourselves!SmileDirectClub filed for Chapter 11 bankruptcy protection as teeth straightening competition kicks into high gear.

Kellanova – the company once known as Kellogg – officially spun off its cereal business from the company. Rice Krispies and Rice Krispie treats are now in the hands of different companies. If there is ever a contract dispute between them, every kindergartener in America might hit the streets in protest.

drawing of a table setting

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