Business
Southwest Changed Flying. Now It Can’t Change Fast Enough. Southwest revolutionized the airline industry. The problem is that what they have to offer is no longer enough. It’s not enough to be a quirky airline. Passengers’ preferences changed. They are more demanding, in a different way than they were before. Other airlines invest and innovate. Stuff like entertainment on a seat and Wifi are now table stakes. Other airlines splash money on technology, lounges and what not. Southwest needs to change with the time to avoid slumping to the second tier like Alaska Airlines or Jet Blue.
Wells Fargo Bet on a Flashy Rent Credit Card. It Is Costing the Bank Dearly. This article provides useful information on the economics of a co-branded credit card. Wells Fargo has to pay Bilt $200 for every new account. Not only do they not get any interchange revenue on rent transactions, but they also have to pay Bilt 0.8% on those. The bank hopes to generate enough interest income to cover for everything, but the revolve rate of 25-35% is far below the standard 70-80%+ seen in normal credit card programs. Put everything together, Wells Fargo loses $10 million a month on this partnership, a crazy amount even for a bank that size.
A great podcast episode on Coupang. If you are not familiar with this Korean version of Amazon, have a listen.
Inside Citigroup’s Most Mysterious Business. “Services is Citi’s “bright shiny sun” around which its other businesses orbit, said analyst Mike Mayo. He figures it is worth about $90 billion to $120 billion, while all of Citi is only trading at a value of about $114 billion“
Apple intelligence and AI maximalism. It was refreshing to see what Apple had to offer during the WWDC. The company didn’t jump on the bandwagon. It didn’t get affected by the frenzied hype. It studied what was being proposed by others on the market, thought about what it could do to benefit its own users, shareholders and itself, and acted accordingly. The result, like Ben said, is a completely different proposition. AI or LLMs in particular is perhaps are a technology, not a product. And to succeed, you need something to bring the technology to the end users, whether that’s consumers or corporations.
Other Stuff I Find Interesting
How Safe Are Driverless Cars in China? I Rode in Some to See. The self-driving technology in China doesn’t seem as well-developed as many claim. It doesn’t even do the basic driving very well. What’s more concerning is the Chinese government’s opaque reporting on the true state of this technology or crashes that came from testing.
A very interesting discussion on Large Language Models (LLM) and whether it’s going to become intelligent like humans. I like the calm composure of the guest. He spoke with reason and logic. The interviewer, on the other hand, came across as aggressive and biased. He might have played the devil advocate to further the discussion, but I felt that he already made up his mind and refused to accept the guest speaker’s argument.
This video on Apple Intelligence is good. Have a listen. I don’t know exactly how Apple Intelligence will change the use of Apple devices. Mainly because Apple has used Machine Learning to make incremental changes over the years. What is more likely is that from now on, the conversation around AI and LLMs will feature privacy, security and practical use more.
China’s Lust for Durian Is Creating Fortunes in Southeast Asia. “The surge in durian exports is a measure of the power of Chinese consumers in the global economy, even though, by other measures, the mainland economy is struggling. When an increasingly wealthy country of 1.4 billion people gets a taste for something, entire regions of Asia are reshaped to meet the demand. In Vietnam, state news media reported last month that farmers were cutting down coffee plants to make room for durian. The acreage of durian orchards in Thailand has doubled over the past decade. In Malaysia, jungles in the hills outside Raub are being razed and terraced to make way for plantations that will cater to China’s lust for the fruit.”
Social-Media Influencers Aren’t Getting Rich—They’re Barely Getting By. Don’t be fooled by the popularity that some influencers have. They may not live as comfortably as you think. Plus, most success stories are not overnight. It requires consistent input and creativity to build a following and generate income. That’s not easy. And there is trouble on the horizon. If the US government bans TikTok, it will hurt the creator community.
We Bought This Bread in April. It Still Looks Fine. It is scary to see that weeks-old bread still looks new. It’s a shame that such a staple in our diet, especially in low-income households, is actually an unhealthy item to eat.
Stats
“As of May, customers were paying, on average, $760 a month for an auto loan”
Minh Quang Duong 
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