Samsung’s Weekend Was Way Worse Than Yours, Plus The Average American Work Week Is Only 34.4 Hours
“There’s been no innovation in the movie business in the last 50 years” — Netflix CEO Reed Hastings, coming in hot on the state of the traditional movie industry.
- U.S. markets finished lower on Friday after the jobs report fell short of expectations and oil continued to drop
- Shares of CIT Group jumped 8% after reporting that it would sell its aircraft leasing business for $10 billion to focus more on its core operations
If You Think You Had a Tough Week
…Wait until you hear about Samsung’s. To start off, the Apple-Samsung patent war is finally going to the Supreme Court. The lawsuit, in which Apple is accusing Samsung of infringing on the iPhone’s design patents, has been going strong since 2011. And it’s resulted in Samsung having to pay a whopping $584 million to Apple—soon to include an additional $119.6 million after Apple won an appeal reinstating the fine on Friday. And now we head to the Supreme Court, which is kinda a big deal: the case has the potential to redefine a 130-year-old patent law.
And if that saga isn’t bad enough, Samsung’s also dealing with its ongoing exploding Galaxy Note 7 nightmare. Wait, weren’t they already recalled? Yes, but an allegedly already-replaced phone exploded in an airport gate this week, and now Samsung is halting all Note 7 production—which was inconspicuously announced during the debate last night. We see you, Samsung.
Take Notes From Mylan
…On how to sweep scandals under the rug. To summarize: in the pharma industry, drug makers pay higher rebates to Medicaid for brand-name drugs. Mylan misclassified the EpiPen as a “non-innovator” (generic drug)—which cost Uncle Sam and taxpayers over $160 million, and pissed pretty much everyone off. Now the under-the-rug part: over the weekend, Mylan settled with the DoJ for $465 million, sending shares up over 10%. Why, you ask? Well, with Mylan’s biggest risk off the table, investors could finally price a floor on the beaten-up stock. What’s done is done. See you for the next scandal.
Good, Not Great
…The September jobs report in three words. That said, there’s not much to complain about here: 156,000 jobs were added last month and annual wage growth is far outpacing inflation. Even though the unemployment rate ticked up slightly to 5%, there’s no need to be spooked—the increase was simply a result of a higher labor participation rate, meaning more people are looking for jobs. Following the report, Fed Vice Chairman Stanley Fischer said the economy is “pretty close” to a “Goldilocks” number, meaning it’s not too hot and not too cold. A heavy-handed metaphor, but we’ll take it.
Comcast Cuts the Cord
…On its unlimited home internet plans. And Comcast is staring right at you, cord cutters. The cable/internet giant is putting a one terabyte cap on its home internet plans across the country. Don’t get us wrong: a terabyte is still a lot of data. But the decision is a sign that Comcast doesn’t want its users watching too much online video…which could become an issue as 4K streaming enters the mainstream. Rock, meet hard place.
- Facebook launches standalone calendar-based ‘Events’ app
- Yahoo hit with another lawsuit claiming anti-male discrimination
- Snapchat kills auto-advance feature in Stories
- Alibaba teams with Spielberg’s Amblin in blockbuster film deal
- Monday: Columbus Day (Banks Closed, Markets Open)
- Tuesday: Alcoa Earnings
- Wednesday: CSX Earnings; Job Openings and Labor Turnover Survey; Fed Minutes Release
- Thursday: Delta, Progressive Earnings; Import/Export Prices; Weekly Jobless Claims
- Friday: JPMorgan Chase, Citigroup, Wells Fargo, PNC Earnings; Producer Price Index; Retail Sales; Consumer Sentiment
The 40-Hour Work Week
…A thing of the future? That’s right: according to Friday’s employment report, the average American workweek is actually only 34 hours per week. Sounds pretty cushy, no? Don’t get too excited though: the workweek is getting longer. In other words, we’ll be at 40 hours soon enough—here are the numbers:
- In August, the average workweek increased 0.1 hours to 34.4 hours per week. The manufacturing workweek is more reasonable (longer), at 40.7 hours—also up 0.1 hours in August.
- One of the more interesting takeaways? At 36 hours, full-time freelancers (think your friend Jen the independent consultant, or Mary who literally just sells cat necklaces on Etsy) work more than the average American worker. Freelancers are on the rise, too—they now account for 35% of the U.S. workforce, up by two million since 2014.
- Yep, the gig economy is real. According to some experts, the shift to freelance workers might be the future, and it’s not a bad thing. 86% of freelancers anticipate their opportunities will continue to grow. And get this: 54% who left a traditional job to be a freelancer make more money now than they did before.
Interview Question of the Day
What does standard deviation measure in a portfolio? (Answer)
Business Term of the Day
Dead Money — Slang for money invested in a security with minor hopes of appreciation or earning a return. In practice, some investors will hold a stock in hopes of a turnaround, earning back some of the last value. However, the likelihood of a turnaround is low.
Food for Thought
Much like headphone jacks, the Big Mac may soon be a thing of the past. Only one out of five millennials have sunk their teeth into the iconic McDonald’s burger. The times, they are a changing…and McDonald’s ain’t lovin’ it.