Morgan Stanley forecasts $8.5 billion boost to US economy in Q3 due to pop culture phenomena

Morning! NASA’s spacecraft is returning to Earth with its first-ever sample from an asteroid on 24 September and this took only 7 years (2 years to reach the asteroid, 2 years to find the best spot to collect some rocks, 3 years to collect the rocks and get back to earth) 🚀🌌

In this week’s edition:

🐝 The buzz that is real

😬 A bitter aftertaste

🙇 Meta to bend the knee

📲 No more paper licenses

- The Itla Squad 💼

Business

Global 🌎️

The buzz that is real

Is all the buzz we saw on social media about the economic impact of the Taylor Swift and Beyoncé concerts in the US true? Yup.

The buzz that is real: Morgan Stanley predicts that real consumer spending will rise by 1.9% in the third quarter, adding $8.5 Billion to the US Economy in Q3, thanks in part to music tours by Swift and Beyoncé, as well as blockbuster movies like "Barbie" and "Oppenheimer." It’s a big deal as such events usually make up only a small part of the personal consumption expenditures price index.

How? Apart from the obvious ticket sales, Taylor Swift and Beyoncé's tours have had a significant economic impact on the cities they visit, with fans traveling from across the country to attend their shows. This has boosted local businesses and even garnered the attention of the Federal Reserve.

Don’t get too excited: As the music tours and blockbuster movies wind down, experts predict a contraction of 0.6% in real personal consumption expenditures (PCE) between the third and fourth quarters. Also, federal student loan payments will resume on October 1, making it less likely consumers will spend money on fun things like concerts and movies.

Big picture: Given the central bank's ongoing efforts to combat inflation, it should consider this cultural slowdown as another reason to have caution when determining the future path of interest rates.

TLDR: The social media buzz about Taylor Swift and Beyoncé's concerts boosting the US economy is true. Morgan Stanley predicts a 1.9% rise in consumer spending in Q3, adding $8.5 billion to the economy, largely due to these events and blockbuster movies. These concerts also benefit local businesses and have caught the attention of the Federal Reserve. However, experts anticipate a 0.6% reduction in spending as concerts wind down, and federal student loan payments resume.

What else is new in news

💹 India's GDP surged by 7.8% in the April to June quarter, marking the country's fastest growth in a year, thanks to the robust demand and a strong services sector.

Local 🇵🇰

IMF’s loan aftertaste isn’t so sweet

The sky is blue i.e. Pakistan is wrestling with high inflation, which reached 27.4%, especially with IMF loan conditions thrown into the mix.

What’s up? Inflation. Pakistan secured a $3 billion IMF loan in July but faces economic challenges due to IMF’s conditions including relaxing import restrictions and ending subsidies. These conditions have led to 38.0% inflation in May, higher interest rates, and a 6.2% depreciation of the rupee in the last month.

• August brought a small dip from July's 28.3% inflation rate, but food prices are still crazy high at 38.5%.

• Gasoline and diesel prices have hit the roof, and with a national election just around the corner in November, things are getting heated with protests popping up here and there.

• There is also a sharp rise in electricity prices, sparking social unrest. Islamabad is now under pressure from the IMF to submit a written plan regarding its proposal to alleviate the concerns of angry citizens dealing with increased electricity bills.

TLDR: Pakistan is grappling with soaring inflation at 27.4%, driven by IMF loan conditions, resulting in higher interest rates, and a 6.2% rupee depreciation. Gas and diesel prices are soaring, sparking protests ahead of the November national election. Rising electricity costs have also caused unrest, prompting IMF pressure for Islamabad to provide a plan to address citizen concerns.

News Flash

🔌 On Monday, the Energy Ministry submitted a request to the National Electric Power Regulatory Authority (Nepra), asking for a Rs10.32 raise in the tariffs for K-Electric consumers across three quarterly adjustments.

Tech

Global 🌎️

Meta to bend the knee to EU

Meta is thinking about offering ad-free versions of Facebook and Instagram for users in the European Union (EU) as a response to privacy concerns raised by EU regulators.

Meta's changing the game plan: Meta, formerly Facebook, has been all about free social networking funded by ads for decades. But Meta's ad-based services rely heavily on analyzing user data which the EU privacy rules aren’t so thrilled about. Meta’s response to the potential introduction of paid subscriptions will be a major shift in the whole business model. Free versions with ads will still be available, but prices and release dates for the ad-free versions are unknown.

This won’t be the first time that Meta is bending the knee (and won’t be the last): Because of the recent EU laws, TikTok and Instagram users in the EU can now block their personal data from being used for content generation. Snapchat and Meta have stopped targeting personalized ads at teenagers in Europe. These developments are a result of Europe's General Data Protection Regulation (GDPR), a landmark legislation aimed at safeguarding online user data.

TLDR: Meta is considering offering ad-free versions of Facebook and Instagram in response to EU privacy concerns. This marks a significant shift from their ad-based model, which relies on user data analysis. Recent EU laws have prompted changes in data use practices by tech giants like TikTok, Instagram, Snapchat, and Meta, reflecting the impact of Europe's General Data Protection Regulation (GDPR).

What else is new in news

💬 OpenAI has launched ChatGPT Enterprise: the business-oriented version of the AI chatbot. What sets it apart from the usual ChatGPT? The Enterprise version lets clients use their own company data to train and customize the AI for their specific needs.

Local 🇵🇰 

Say goodbye to bulky paper licenses

As usual, Punjab is ahead of the curve with the latest updates. The Punjab police have introduced an electronic driving license facility to streamline the process for its citizens across the Punjab region.

What’s it about?

• With the e-driving license, you can download your license as a handy PDF. This means you can carry it on your phone and use it hassle-free.

• No matter where you live in Punjab, it's now easier than ever to get your license. They've gone from just 45 license centers to 200, improving accessibility.

• To avail of this service, citizens only need to register their national identity card number and date of birth on the Punjab Traffic Police website (DLIMS).

Zooming out: The introduction of electronic licenses also serves as a deterrent against fake licenses. Reports indicate that the Federal Investigation Authority (FIA) has uncovered 27,000 counterfeit licenses in three years.

TLDR: Punjab is taking the lead with an electronic driving license system, making it super convenient. You can download your license as a PDF on your phone. Plus, they've expanded license centers from 45 to 200. Just register your ID and birthdate on their website to get it. This also helps combat fake licenses, with 27,000 counterfeits busted in three years.

Tech tour of news

📺 Pakistan's Air Link Communication Ltd. will begin assembling Xiaomi Corp. TVs in January for sale in the country. Air Link's CEO stated that they don't anticipate needing a significant investment since the assembly lines for both products are similar.

More interesting Itla (اطلاع) we consumed:

🏏 Irfan’s Junejo’s stunning vlog on the v eventful and uneventful (tsk tsk @ 🌧️) Ind vs. Pak Asia Cup match. Just watch it for the beautiful shot of Kohli’s wicket 😍

🎬 The golden days of Bollywood are over… except for this brilliant comedy crime thriller named Andhadhun on Netflix 💯