Good morning. This is quite the stat: San Francisco is the only major metro area in the US where rent prices are lower now than they were before Covid hit in March 2020. —Neal Freyman, Matty Merritt, Jamie Wilde, and making his newsletter deBrew, intern Joseph Abrams | | | |  | Nasdaq | 11,099.15 | | | | | S&P | 3,789.99 | | | | | Dow | 30,668.53 | | |  | 10-Year | 3.289% | | | | | Bitcoin | $22,429.95 | | | | | Netflix | $180.11 | | | | *Stock data as of market close, cryptocurrency data as of 8:00pm ET. Here's what these numbers mean. | - Markets: Investors gave a standing O to the Fed's biggest rate hike in decades. The S&P snapped a five-day losing streak (though it's still in a bear market), and the Nasdaq soared thanks to a surge in tech shares.
| | | | Win McNamee/Getty Images In its quest to fight soaring inflation, the Federal Reserve is trying to throttle the economy like it's a three-year-old iPhone. The central bank hiked interest rates by a mammoth 75 basis points (bps) yesterday, which is the biggest rate increase since 1994. Through interest rate increases, the Fed is attempting to raise the cost to borrow money, slow economic activity, and bring down inflation that's ripping at 40-year-highs. How we got here With all due respect to the Boston Celtics, the current bout of inflation wins the award for overachiever of the decade. In 2021, Fed officials deemed inflation a "transitory" consequence of pandemic reopenings. But due to a mix of resilient consumer demand, persistent logistics bottlenecks, Covid lockdowns in China, and the outbreak of war in Ukraine, prices kept going up. Even as recently as just a few weeks ago, policymakers signaled they would be hiking rates by 50 bps. But prices—you know what's coming next—have continued to climb. Last Friday's consumer price index showed that inflation jumped to 8.6% in May, a huge disappointment to the many economists who thought it might have peaked, and an omen that the Fed had to hike rates by an even greater amount. And what comes next? Even more rate increases. The Fed projected that it would hike rates by another 175 bps by the end of the year, to a level far above what it estimated in March. But Fed Chair Jerome Powell, in a press conference yesterday, suggested that an "unusually large" 75 bps increase wouldn't be the norm going forward, though it is possible at the Fed's next meeting in July. Hiking interest rates this hard, this fast will be painful for the economy and likely put some people out of work. That's the point, after all—people need to spend less for prices to come back down to earth. And it seems like that's already happening: US retail sales fell for the first time in five months in May, as Americans pulled back on buying cars and other expensive items. Big picture: As much as Americans love to think we're exceptional, inflation has been afflicting countries around the globe. In an analysis of 111 countries, Deutsche Bank found that the US' inflation rate sits roughly in the middle.—NF | | | They say you can't teach an old dog new tricks, but you can get your portfolio to do something pretty cool: It can fetch you both growth and stability. So, how does one create such a clever portfolio? Simple: Get its owner to use Fundrise. Their easy-to-use platform is changing the game when it comes to investing in premium real estate, an asset class known for generating long-term wealth and portfolio stabilization. Because real estate is essential to our everyday lives, it's intrinsically valuable. Now Fundrise is making investing in high-end real estate simple and accessible for everyone, offering a level of diversification previously reserved for the wealthiest investors on, well, earth. With flexible minimums and a simple sign-up, you can create an impressive portfolio in no time. Get started today. | | Francis Scialabba  Covid shots for tots are almost cleared for takeoff. An FDA advisory committee unanimously recommended Moderna's and Pfizer's Covid vaccines for kids under five, which is the only age cohort in the US that doesn't yet have an authorized vaccine. The FDA is expected to accept these recommendations and authorize the vaccines by the end of the week, setting up a vaccine rollout as soon as next Tuesday.
 Facebook's on its copycat grind again. A newly surfaced exchange between Facebook higher-ups in April shows how the platform may be trying to copy the features of one of its main competitors: TikTok. In a memo leaked to The Verge, head of Facebook Tom Alison said that he wanted to tweak the site's homepage to one more reminiscent of TikTok's "For You" page, meaning that popular content from around the app will be prioritized above pics of your former high school classmates. As part of this pivot, Messenger would be mashed back together with Facebook, which it split from in 2014.
 One pandemic origin story solved. Scientists say they've discovered where the Black Death originated: Central Asia, in modern-day Kyrgyzstan. It's a breakthrough that helps us better understand the causes of the deadliest pandemic on record, which killed up to 60% of the Eurasian population between 1346–1353 AD. If a similar timeline is applied to the current pandemic, we can expect to discover how Covid began around the year 2700.
| | Tesla Tesla vehicles were involved in more crashes while using driver assistance technology than any other carmaker, according to a new report from the National Highway Traffic Safety Administration (NHTSA). It's the first report of its kind, and reflects how the regulator is increasing its scrutiny of self-driving tech. FYI, the vehicles in this report are more Herbie than Bumblebee. They use features like lane assistance and auto-adjusting cruise control, and require a driver behind the wheel at all times. What the report showed: Out of 392 total crashes reported to the NHTSA over the year ending May 21, Tesla accounted for 273, Honda for 90, and the other 100+ companies included in the survey reported 10 or fewer crashes each. But that doesn't necessarily mean Teslas belong in Twisted Metal, because… - There are simply more Tesla vehicles using driver-assist technology on the road than from other brands.
- Tesla vehicles auto-report crash data via wi-fi and cellular connections, while other automakers mostly rely on customer reports.
Basically, "The data may raise more questions than it may answer," NHTSA administrator Steven Cliff said. Still, the report provides more leverage for critics of a Tesla Autopilot system that is already under loads of pressure. Just last week, the NHTSA upgraded its probe of Tesla's driving assistance system to an "engineering analysis," which could lead to a recall.—JW | | Francis Scialabba Jokr has entered its Joker arc. The ultrafast delivery service that has raised $430 million to date said yesterday that it's slashing its US operations to focus on its more profitable business in Latin America. The company, which hit unicorn status last December (less than a year after it was founded), joins the growing list of 15-minute delivery startups shuttering operations faster than they can deliver a pack of Chobani. The delivery service said it would close nine micro-fulfillment centers in Boston and New York and lay off around 5% of its staff. But compared to the recent challenges faced by its speedy friends, it's getting off pretty easy. - 1520 was the first super fast delivery startup to close up shop in December.
- Buyk, the US subsidiary of a popular Russian grocery delivery service, declared bankruptcy in March, just 16 days into Russia's invasion of Ukraine.
- Fridge No More became Funding No More after a potential deal with DoorDash fell through in March.
- Even GoPuff, which hit a $15 billion valuation last July, laid off 3% of its staff in March, quashing rumors that it would be throwing an IPO tailgate in the near future.
Bottom line: Last year, VCs poured hundreds of millions into 15-minute-delivery startups in hopes that they'd revolutionize the way urbanites shopped for groceries. But now, during a period of rising interest rates and unstable markets, investors are losing their appetite for risky bets.—MM | | Squid Game/Netflix via Giphy Stat: Netflix announced a Squid Game reality show in which 456 contestants will play a series of games "inspired by the original show" (but hopefully not too inspired). The winner will take home $4.56 million—which the company says is the biggest "lump cash prize in reality TV history." Quote: "100% based on greater fool theory." That's what Bill Gates thinks about NFTs. It's not exactly an endearing characterization: Greater fool theory states that during a market bubble, an investor can make money by purchasing a risky asset because there will always be someone dumb enough to buy it from them at a higher price. Read: Inside a corporate culture war stoked by a crypto CEO. (New York Times) | | Fast-food pricing 101: The former pricing manager for Wendy's describes why cheap burgers cost what they do in this informative thread. Highly useful: How to tie a heel lock for a running shoe. The secret to lashes that look like extensions: This best-selling mascara gives you that salon-perfect look sans the expensive pricing, annoying clumping, or unwanted smudging. Brew readers get 15% off their entire order.* Besties go shopping: For groceries, that is. Check out this quiz we made with Amazon Ads that reveals how adult Gen Zers fill up their carts (and free time). Test your knowledge here.* *This is sponsored advertising content. | | - The white man accused of killing 10 Black people in a Buffalo supermarket was charged with federal hate crimes, which means prosecutors could seek the death penalty.
- Lego will spend more than $1 billion on a new factory in Virginia—its second in North America and seventh in total.
- Dr. Fauci tested positive for Covid-19. He has mild symptoms, according to a statement from the NIH.
- Elon Musk will answer questions directly from Twitter employees for the first time at an all-hands meeting today.
- Golf's US Open tees off this morning. Because the event is run by the USGA and not the PGA Tour, players who've defected to LIV Golf, such as Phil Mickelson, will still be competing.
| | On Imposters, we sit down with titans of industry, sports, and entertainment to discuss the personal challenges they've overcome to get where they are today. It's honest, raw, and a reminder that we're all just doing the best we can. Check out some recent popular episodes: This editorial content is supported by Sakara. | | Brew Mini: "Fantasy role-playing game featured in Stranger Things, for short" (3 letters) is your sample clue for today's Mini crossword. Play it here. Three headlines and a lie Three of these headlines are real and one is faker than your happy hour promise to attend a 6am workout class. Can you guess the odd one out? - Rats fitted with tiny backpacks are being trained to help earthquake survivors
- Mom and teenage son create 'First Time Sex Starter Kit'
- Slack's CEO thinks a dating app for coworkers could be in the company's future
- Want 100 cockroaches in your home? NC company will pay you as it tests a new pest control method.
If you love Three Headlines and a Lie, play along on The Refresh from Insider and dive deeper into these bizarre news stories. | | | We made up the Slack one. | | | Written by Neal Freyman, Jamie Wilde, and Matty Merritt Was this email forwarded to you? Sign up here. WANT MORE BREW? Industry news, with a sense of humor → - Future Social: the Brew's take on the world of social media
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