Hello! In a dramatic Monday for British politics, Prime Minister Rishi Sunak fired a controversial home secretary and brought former PM David Cameron back into the heart of government in one fell swoop. Today we're exploring:
Serving's up
For years, the pay packets of America’s leisure and hospitality workers grew at a less-than-stellar pace, falling behind the wider economy. The end of the pandemic changed this dynamic dramatically. American consumers emerged from lockdown with some $2 trillion in excess savings, leaving restaurants, bars, and hotels scrambling to keep up with the spending shift from stuff to stuff-to-do.
The good: To entice workers, service employers hiked salaries. That meant, for the first sustained period in recent memory, the wages of leisure & hospitality services employees climbed faster than wages in the wider economy. According to data from the Federal Reserve Bank of Atlanta, median wages in the sector rose some 7.2% in the 12 months to Jan 2023.
The bad: The pay surge seems to be fading, with the latest data showing a 5.8% increase in the last 12 months, in line with other industries.
The ugly: This data doesn’t account for inflation, which hit ~9% year-on-year in June 2022, and has likely wiped out much, if not all, of the post-pandemic wage gains for services workers.
The point: As wage growth slows, lower-income consumers might begin to pull back on their spending, which has been a bedrock of the American economic recovery until now.
AI’m feeling lucky
Google is reportedly lining up an investment worth “hundreds of millions of dollars” in Character.ai, just weeks after the company agreed to push some $2 billion into another AI startup, Anthropic.
Character.ai, which raised $150 million in a funding round that valued the company at $1 billion earlier this year, already has ties to the search giant, having been founded by former Google employees who’d previously worked on its large language models.
As with competitors like ChatGPT, monthly visits to the platform have dropped modestly since the summer — per data from Similarweb via Variety — but its users are still giving up a lot of time pretend-talking-to everyone from Tony Soprano to Napoleon Bonaparte.
Characterful
Developers have rushed to imbue chatbots with distinct “personas” and character traits to distinguish them from the ever-growing crowd of automatons. Last month, for example, Meta announced its range of AI with in-built “personality” on Messenger, while Elon Musk’s xAI unveiled Grok, a chatbot with a "rebellious streak”, in early November.
On this front, Character.ai has been several steps ahead of the game for a while — and users can’t seem to get enough. Indeed, since its launch last September, the chatbot’s been generating over 1 billion words each day, delivered by bots resembling celebrities, fictional characters, and historical figures. The chatbot’s users spend almost 5x longer in a typical interaction than ChatGPT fans spend with the OpenAI bot, with desktop and mobile Character.ai users logging an astonishing 33 minutes on the platform per visit in August.
East meets West
On Wednesday, Chinese President Xi Jinping is scheduled to arrive in San Francisco for the Asia-Pacific Economic Cooperation summit, which will include a meeting with Joe Biden — their first in over a year.
Jinping hasn’t stepped foot in the States since talking airstrikes with Trump over a "beautiful piece of chocolate cake" 6 years ago. Following China's economy showing signs of stalling, at the top of this year's agenda is the $760bn in trade between the two countries: a complicated economic relationship that’s been strained by tariffs, trade wars, security breaches, and spy balloons in recent years.
Chimerica
Correspondingly, US public opinion of China has only worsened in that period. According to a YouGov survey, those considering China an "enemy" of America grew to 80% in Aug 2023, up from ~39% in the same month in 2017, while those considering the country as an "ally" shrunk considerably to just 8.7% as of August.
On the other hand, a separate poll saw a surge in positive attitudes towards the US amongst Chinese citizens: in April 2022, over 80% of Chinese respondents viewed the US as an enemy; by 2023, this figure had fallen to less than 50%. Even so, the two presidents have their work cut out for them if they are to mollify years of mounting distrust on both sides: 75% of Chinese pollees reported still being concerned about US-China tensions.
• Private equity firm General Atlantic is upping its stake in Joe & the Juice to become a majority shareholder, valuing the chain at ~$640 million.
• US stocks snapped an 8-day winning streak at the end of last week, but the S&P 500 Index is still up ~7% since Oct 27th.
• According to a new study, Google should be paying American news publishers over $10 billion every year for the way it uses their content on its search engine.• The star-studded Barbie movie soundtrack has received 11 Grammy nominations for the 2024 Awards.
• Oreo makers have literally been accused of skimming the cream off the top, with the cookies reportedly the most recent product to be hit by “shrinkflation”.
• Mapping the best selling vehicles in each each state.
Off the charts: The Marvels netted just $47 million at the domestic box office — the lowest-grossing opening weekend in the MCU’s sprawling 33-film history — but which 2019 movie was it a sequel to? [Answer below].
