Apple Announces New AirPods; Fed Leaves Rates Unchanged; Googles Fined In EU
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NEW PODS, WHO DIS?
Remember when the only people who wore wireless blue-tooth headsets were cabbies and used car salesmen? My how the times have changed.
Apple announced its second-gen AirPods on Wednesday and black-turtleneck-donning fanboys haven’t been this hot and bothered since that U2 album automatically downloaded on iOS devices.
And the new specs are tiiight: a new, faster H1 chip (so long, W1!), speedier device-connectivity time, 50% more talk time, and “Hey Siri” compatibility which allows you to wake up Siri hands-free … and will undoubtedly cause chaos in households with someone named Siri.
Not to mention, the new headphones will be equipped with a wireless charging case (for an extra $40) … and will be referred to as “Dealpods” by at least 47% more of your friends than the first iteration.
Apple hopes that wearables, like the Apple Watch and AirPods, will help offset its sputtering iPhone business which currently accounts for two-thirds of revenue. The plan so crazy it just might work seems to have a fighting chance, with wearable’s revenue rising 35% last year to more than $17B in 2018.
But that’s not all! Apple announced a slew of other products this week including a new iPad and iMac ahead of an event next Monday. Rumor has it (read: it definitely will) that Apple will unveil its new TV streaming service at the shindig which one can only hope will be less awkward than the Elon Musk Model Y event.
And the AirPower, a wireless charging pad that can juice up multiple devices at once, appears to be in the pipeline. Who needs iPhone sales anyway?
EVERYTHING CHANGES BUT NOTHING REALLY CHANGES
*Jerome Powell inserts foot in mouth*
Just three months after stating there might be two rate hikes in 2019, the Fed has walked back its claim and restated there will likely not be any rate hikes in 2019, the year of our Lord.
The Fed left rates unchanged after yesterday’s Fed meeting, citing slower growth of household spending, a decrease in business fixed expenses, a drop in energy prices in the first quarter … and presumably “millennials and their avocado toast.” The federal funds rate, which is used as a benchmark for credit card and mortgage rates, was held steady between 2.25% and 2.50%.
But that wasn’t the only news Jerry Interest Rates and his squad had for us. The masters of the universe opened the kimono on their balance sheet plans. The Fed will slow the drawdown of its balance sheet beginning in May with plans to halt the reduction policy altogether by September.
The Fed also lowered its expectations for its GDP growth and the unemployment rate, down 0.2% and up 0.2% from December, respectively.
So what did the markets have to say?
10-Year Treasury yields did not take too kindly to the news, dropping 8 basis points to 2.528%, its lowest level of the year. 5-Year Treasury yields hit a thirteen month low, falling 10 basis points, to 2.328%. And major indices fells on the news of the Fed’s pessimistic economic outlook, led by plummeting bank shares.
FINE BY ME
From 2006 through 2016, Google installed clauses in its contracts with websites preventing them from working with the search engine’s competitors. The company even went as far as to require third-party websites to seek permission to change the way it displays ads on Bing and other Google competitors. No wonder AskJeeves fell off.
Even though the third-party websites signed contracts, it was the promise of working with Google, whose vast reach and superiority are dwarfed only by that of the Lannisters, that lured them into these unfavorable deals. Anything for a chance at the Iron Throne, I guess.
This isn’t Google’s first rodeo. It’s developed a bit of a bad boy reputation across the pond. The EU fined the Google Glass maker (we didn’t forget, you guys) $2.7B and $5B (a company record!) in 2017 and 2018, respectively. The $5B tab was related to Google forcing Android operating system users to use pre-loaded Google apps.
All told, there doesn’t seem to be any impact on the success of Google’s business, though.
IN OTHER NEWS
- Allow me to reintroduce myself. Levi Strauss is heading to the public market again today, for the first time since 1985, following an IPO that valued the company at $6.5B. That makes it one of the largest retail IPO’s in the past decade. The IPO raised around $623.3M after shares priced at the top of the range.
- Glypho-say it ain’t so. Bayer’s 2016 purchase of Monsanto is turning out to be rather costly, as the latter’s Roundup weedkiller was determined by a San Francisco jury to have been a “substantial factor” in the onset of a local man’s non-Hodgkin Lymphoma. The chemical in question, glyphosate, has been the target of environmentalist groups as of late. Following news of the verdict, Bayer saw a 10% drop in its share price.
- The last straw. Starbucks is rolling out straw-less lids for its cold drinks in six more cities this summer in an effort to cut down on plastic waste. LA, SF, Seattle, DC, Toronto, and Indianapolis will all feature the lids, which will reduce plastic waste by 9%. According to the coffee-slingers, all plastic straws will be gone from its stores by 2020.
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