Congratulations to all you Eagles fans. And my condolences to the Chiefs, along with everyone whose property got damaged in the resulting Super Bowl riots in Philadelphia.
Fortunately, as I understand it, most of the ecstatic fans there were much more interested in climbing everything in sight – telephone poles included, in typical Eagles fan fashion – than celebratory destruction.
Since this is an investment publication and not a sports blog though, let’s move on to the commercials… starting with this introduction from Slate in “The Super Bowl Commercial Has a Patrick Mahomes-Sized Meltdown”:
This year’s Super Bowl arrived in the eye of the national vibe shift. Donald Trump, you might remember, has won a second term in office. And there he was, saluting during the national anthem before the game, and the crowd wasn’t upset at all. MAGA-dom is ascendant, and not only that – for the first time since the inception of the movement, it’s arguably become culturally dominant.
Hardly happy about that, the Slate writer still sighed in relief that the commercials weren’t too obnoxious. And most of them really weren’t, either to the right or the left.
In past years, we’ve seen plenty of political and societal pushes during the Super Bowl. Instead, 2025 gave us Mountain Dew’s ad featuring British singer Seal turning into an animal seal and DoorDash’s commercial with comedian Nate Bargatze.
The number of companies looking to exploit movements for money is on a definite decline. They’re now back to more traditional manipulations into your wallets.
Tim Calkins, a professor of marketing at Northwestern University’s Kellogg School of Management, however, makes an interesting point – that these commercials were mostly made before Trump even won. The producers only knew that people would be weary of politics after the election.
So this one might not be a Trump win after all.
Even So, Google Is Cutting Down on DEI
With that said, President Trump has made it his mission to cut “wokeism” out of the American government.
His administration has already ordered an end to internal federal programs that promote diversity, equity, and inclusion (“DEI”). The same applies to the military. And federal contracts.
It seems as if he means business, and it also seems as if businesses are getting on board with his thinking.
Even before Trump took official office, multiple major corporations began rethinking such policies themselves. This included McDonald’s (MCD), Walmart (WMT), Target (TGT), and Meta Platforms (META) – which, incidentally, laid off 5% of its staff today.
And now, in perhaps the most shocking move so far, Google has added itself to the list.
The Alphabet (GOOG) entity emailed its employees on Wednesday, announcing it would no longer set DEI hiring targets. As The Wall Street Journal – which broke the story – noted, this backtracks on its 2020 decision to increase “leadership representation of underrepresented groups” by 30% by 2025.
Chief People Officer Fiona Cicconi sent her own email on the subject, promising to maintain “an environment where everyone can thrive.” But apparently that will be with less focus on gender, ethnicity, orientation, and similar associations in Google’s hiring practice.
I bring this up not to be controversial but to show that there is a definite business shift that’s happening. And this will have an economic impact.
Left-leaning sources are quick to point out all the negative possibilities, claiming it will lead to increased unemployment. Right-leaning sources are equally quick to point out that when people are hired on their merit alone, they tend to perform better for their employers, their customers, and the larger economy.
I’m sure you know which side of the debate I fall into. But the proof will be in the pudding one way or the other.
Ford Is Failing So Far in Its EV Attempts
In similar news, let’s discuss Ford Motor’s (F) earnings report last week.
The company beat Wall Street’s full-year 2024 expectations on both the top and bottom lines. It reported adjusted earnings before interest and taxes (“EBIT”) of $10.2 billion for the full year, $1.84 as its adjusted earnings per share, and net income of $5.9 billion.
But for 2025, it’s forecasting EBIT of $7 billion to $8.5 billion. And, no, that has nothing to do with Trump’s tariffs, according to Chief Financial Officer Sherry House.
This negative outlook made the media rounds last week. However, what’s being less highlighted is the $5.1 billion loss Ford took in its electric vehicle (“EV”) and software business. That’s on top of a $4.7 billion loss in 2023, with a predicted $5.5 billion loss this year as well.
Now, it should be noted that General Motors (GM) achieved a “variable profit positive” position last quarter in its EV segment. That means its EV revenue was higher than the money it spent on labor and materials for those vehicles.
Then again, the term “variable profit positive” excludes the initial – massive – investments of engineering the EVs and building and equipping factories to make them, according to Reuters.
So it’s only a step toward a win. There’s still a lot to prove.
A Surprising Move in the U.S. Steel Saga
Trump met with Japanese Prime Minister Shigeru Ishiba on Friday followed by a press conference… where he made a very interesting statement.
I suppose that should be expected by now though.
This latest interesting statement concerned Nippon Steel’s attempt to buy out United States Steel (X). Biden refused to allow the deal to go through, and Trump took the same exact stance. But that only made both companies try all the more.
It now turns out Trump may have come up with a solution to the disagreement, where Nippon will look into investing in its smaller competitor rather than purchasing it. That’s what he told reporters, and it doesn’t seem as if this is one of his “art of the deal” negotiating tactics.
A partnership of some sort is the end goal, not the initial ask.
Neither leader gave any details about what this “investment” will look like. But Trump did add that he’ll be meeting with Nippon Steel sometime this week to work out the details. And Ishiba said the idea should benefit everyone involved.
U.S. Steel fell 5.83% on Friday but seems like it was on the road to recovery today.
A Recap of January’s Jobs Report
Last but not least, I’m sure that many of you – even most of you – saw the news about the January jobs report. But it’s still a worthwhile story to highlight here considering how the Federal Reserve’s interest rate decisions hedge on such data.
So…
We found out last week that the U.S. economy added 143,000 new jobs to start out the new year. That was less than the 169,000 economists expected and even more significantly down from December’s showing.
Yet it was still enough to send unemployment down a notch from 4.1% to 4%.
We also discovered that December’s already strong showing of 256,000 jobs added was revised up to 307,000… calling into question why we report preliminary data at all. In fact, between November and December, the labor market grew by 100,000 more positions than first believed.
That’s a significant difference, to say the least.
Meanwhile, U.S. employee wages grew 0.5% month over month and 4.1% year over year. This all led an associate to point me to Sean Snaith, a University of Central Florida economist.
He says this latest round of economic data isn’t the greatest news for anyone betting on rate cuts any time soon. If anything, he says, it “gives off an uneasy feeling that rates could even go in the opposite direction.”
Regards,
Brad Thomas
Editor, Wide Moat Daily