In this podcast, Motley Fool host Dylan Lewis and senior analysts Jason Moser and Matt Argersinger discuss:

  • Whiplash in employment data and the certainty of rate hikes for the rest of the year.
  • Meta's new app, Threads, and what it means for Twitter.
  • Some surprises from the first half of 2023 and stories to watch for the rest of the year. 
  • Two stocks on their radar: Vesta Real Estate and Topgolf Callaway.

Motley Fool host Deidre Woollard spoke with Ben Smith about the cycles in digital media, his new book Traffic, and how one legacy media company has managed to stay on top throughout all the shifts.

To catch full episodes of all The Motley Fool's free podcasts, check out our podcast center. To get started investing, check out our quick-start guide to investing in stocks. A full transcript follows the video.

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This video was recorded on July 07, 2023.

Dylan Lewis: Will the credit crunch ever come? Motley Fool Money starts now. 

It's the Motley Fool Money radio show. I'm Dylan Lewis joining me in studio, Motley Fool Senior Analyst Jason Moser and Matt Argersinger, great to have you both here guys. All right. We've got predictions on the second half of the year, a look at the evolution of digital media, and of course, stocks on our radar, but we are kicking things off looking at the big picture. Matt, we got an update on unemployment numbers and employment numbers this week from two different sources, and I have to say, trying to pay attention to these numbers at a little bit of whiplash, looking at the results.

Matt Argersinger: Yeah, you're not the only one, Dylan. It was like a head fake on Thursday when the ADP came out, which is all about private sector jobs and they reported a job growth of almost 500,000. So we're setting up for Friday's labor report thinking, wow, we might make it a big number there too, but no, the labor department came out with a report that's showed payroll numbers rose just 209,000. That's actually the lowest number since way back in December 2020. It's a big disappointment there. There's methodology difference between the ADP and the labor department ADP's looking at actual paychecks. Labor department is more of a survey. Take your pick, but over time these numbers tend to converge, but if you look at the first six months of the year going by just the BLS numbers, which also includes some downward revisions, we're now showing an average monthly gain, job gain of 278,000. Still pretty strong, but that's actually down a lot from almost 400,000. The 400,000 monthly average we had for the first six months of 2022. There is a slowing happening in employment. We're starting to see that. Same time though, get hourly earnings, excuse me, of 0.4%. That was slightly higher than expected, 4.4% from a year ago. There's still some inflation pressure on wages and the unemployment rate is still near historic lows at just 3.6%. Unfortunately we do this when we look at economic data. It's like on one hand, job growth is definitely slowing, on the other hand, wage growth is still high and the employment picture is pretty strong. I think the big question is, does this change the idea that the Fed is going to keep raising rates? No, I don't think so.

Dylan Lewis: Yes. One thing I want to ask you about money because I was reading just the other day that we are at a point now where the rate of people leaving their jobs. I mean, over the last three years, we see people just pick up and leave their job and go do something else. Could they've had that luxury for a while. It's it's been a workers mark and that rate is coming back down to pre-pandemic levels. In other words, people are not picking up or leaving their jobs just to go do whatever else anymore. You feel like that maybe is a sign that we're getting to a point where this jobs market is becoming a little bit more stressed and folks see that, maybe it's not so easy just to go do something else as it was before.

Matt Argersinger: Well, I agree. I think the slack that was not as there as it was, and I think that's just one of the things the Fed is trying to step on, and I think you can conclude that it's succeeding just given the momentum we're seeing or the trend we're seeing, I should say, in the monthly averages, but it just feels like there's still a way to go.

Dylan Lewis: Matt, you mentioned that we are still seeing wages go up. That's slowing a little bit, but we're paying attention to that because we know that that's going to play into the long-term picture for inflation, and some of the moves that the Fed winds up making. Looking at minutes from the Fed meeting recently, getting look at those this week, I think we have to see expectations of additional rate hikes with almost no doubt.

Matt Argersinger: No doubt, yeah. I think two rate hikes is easy. There's even potential now for a third retag Lisa's small possibility before the end of the year. It's just to me. It's such a sharp contrast where we were just a few months ago when a lot of analysts were saying, oh no, actually we're setting up for cuts before the end of the year. That is completely out the window yet the market seems unfazed by that, which is a surprise to me. I think we have to collectively go from thinking, all right, how high will rates go? And instead start thinking about how long our rate is going to continue to stay high because I think a lot of people had the expectation this is going to be relatively short-term. We're going to see a sharp reversal once we saw inflation moderate a little bit. It doesn't seem like that's the case.

Dylan Lewis: No. It's a really different world and a different set of parameters for investors. If you imagine a world where rates are going to stay high. This high or higher for a long period of time. I guarantee you that's not what a lot investors thought about certainly coming into this year.

Matt Argersinger: It's a huge adjustment and I think something that a lot of people are getting themselves used to as they're looking at businesses and just how things may play out for the rest of the year. Jason, anything on the rate environment or the macro environment for you?

Jason Moser: I regard to rates, I just continue to wonder, I mean, going forward we're going to see a point here where obviously folks are going to settle into the jobs that they have. They were seeing The student loan repayments are going to read the student loan payments are going to resume. At some point, I think we're going to see 2024, a lot of numbers start to flow through the economy. That makes me wonder if we won't see a little bit more of a discussion of perhaps cutting those rates because I think there are a lot of things connected to these inflation numbers that lead me to believe that maybe 2024, we're going to see inflation come down a little bit more meaningfully than perhaps we've been expecting it to.

Matt Argersinger: Switching gears and over to social media, we are seeing competition in the space heating up. This weak Meta launched its Twitter rival Threads, and it is reportedly the most rapidly downloaded app of all time. Jason, are you surprised by the adoption we've seen for this new launch?

Jason Moser: I'm not. I don't know why. I'm impressed with the numbers, but to me that makes sense. I mean, 50 million plus people signing up for it. That's a lot. That's impressive. Don't get me wrong, but I mean, Instagram has got two billion users. I mean, this thing is tethered to Instagram. I mean, I expected these numbers to be gangbusters and so I'm not surprised that they are. I mean, this is the time for Meta to take a shot. I mean, Twitter is just hit us data chaos. I mean, Musk has had to unwind a lot of things that were done. Twitter, the platform over the years, and he's taking a bit of a different approach with a bit of a different philosophy. This is a point of time where Twitter is very vulnerable and it makes a lot of sense for Meta to get out there and give this a world. Twitter has got a ton of issues. I don't know. I don't think Threads is going to replace Twitter. I mean, you and I were talking about this yesterday. I see a world will both exists. I think Threads actually it can be very complimentary to Instagram, but I don't think we're going to see most people migrate from Twitter to Instagram, and that really it's because of the free speech issue. I mean, I'm not saying you're going to get pure free speech on any platform, but I think there is a large audience out there that wants the most free speech they can get. That's not going to happen on Meta's platforms. It's just not. They've laid down the gauntlet there and we know that with Twitter, that's really one of Musk's primary priorities. He wants to focus on a free speech platform, which is why he also knows that pivoting away from ad supported is not optional. That's why he knows that the clock is ticking and he's got to figure out other ways to monetize this platform beyond just advertising dollars, and that's understandable. Advertisers love free speech to a degree, but you got to be careful there. They are dollars at work and they're not going to let just anything to be said. That makes a lot of sense. I think is just going to be very interesting to see how these two platforms co-exist because they are very similar.

Matt Argersinger: Yeah, I like one of the last point you made about the advertisers because I do believe both of these platforms can exist, but the advantage, of course, that Meta has and Instagram has is the advertisers know they have more data, I think on those users. If those users start gravitating over to the more text-based Twitter like platform that Threads is, I got to believe Meta can monetize those users a lot better than Twitter has, and that's been a big problem in Twitter. I think Meta can figure it out. To that point. I mean, Meta, Instagram, and Threads. I mean, if you look at the terms of use. These are data harvesting machines. I mean, they collect a lot of data. Some people care about that, some people don't, and you have to make that decision, but I think an interesting dynamic yours that Instagram ultimately wants to make Threads part of the fediverse. Now, the fediverse this network of social media servers that essentially brings Threads beyond just Meta social media network. It extends it out to things like mastered on, and I think WordPress is a part of the fediverse. In other words, it broadens your social media landscape, so to speak, beyond just Meta controlled properties. You asked, why would they do that? Well, I mean, it's going to give them an opportunity to collect data on a bunch of users that they may not even have on their platforms to begin with, and ultimately, it just gives them an opportunity to monetize even more so while they're not even advertising with Threads right now. You know that's coming, and I think that fediverse angle is just an interesting one and it tells you a little bit of the longer-term aspirations for Meta in regard to monetizing these platforms. Looking at the dynamics here, I can't help but see Meta as just a more flexible and dynamic competitor in the space. They have a Cash-cow business despite all of the missteps they've had over the last couple of years, and I think they can afford to be a little platform agnostic here, Jason, because this is not the only game in town for them whereas Twitter, a little bit more resigned to the fact that this is the app and Musk has to make it work.

Jason Moser: Meta does not need this to succeed at all. Twitter doesn't need it to fail, but I guarantee a Twitter doesn't want it to gain attraction because you're right. I mean, the one competitive advantage of the Meta has, it's just a massive user base and they can scale anything virtually overnight as we've seen, and circuit board can succeed in replacing Metaverse, which investors painted with a fediverse, which I didn't even know existed. Hey, that's what a rabbit to pull out of a averse.

Matt Argersinger: That's the thing. You learn something new every day.

Dylan Lewis: It's all about branding. Earlier this summer, sticking with tech, Apple unveiled its latest product, the VisionPro headset. This week we got an update on the company's plans. It will be reducing its production targets for their vice, apparently because manufacturers, we're having a hard time with the devices complexity Jason. What does this news do for your expectations of the VisionPro.

Jason Moser: Apple building a complex device, I mean color me shocked. This thing looks like it's got a lot of moving parts to it. I'm not terribly surprised. Apple is very methodical on the way they move into markets like these, and we knew this was going to be a very slow process even if everything went according to plan. Clearly, they're going to be some delays here, tech supply issues or some problems with the displays there. What I think is more fascinating and we've been talking a lot about this and the cost of this device. We're already talking about the cheaper version. When does it come. They're already saying, they're working on a cheaper version that's two years out. It goes back to, I think, this expensive first device. This is really to set the tone, help developers build experiences that make this device relevant and ultimately attractive to consumers. The one they start rolling out, there is more affordable devices, it's a little bit of an easier sale.

Dylan Lewis: Yeah. This was never going to be a mass-market device. I wonder, does it just make sense for Apple to get this right. Because the people that are going to be the early adopters are going to be the ones that are really shaping the narrative around this and the use cases for this that's why we're seeing them ratchet some of these production volumes down.

Jason Moser: I think that's exactly right. That's why you're seeing companies like Microsoft, Unity and Adobe jump all in really on developing experiences with this device because they know there's going to be something there, but the only way they can get something there is to ultimately have the experiences. The technology is fascinating, but we go back to what are the use cases for these headsets, a solution in search of a problem.

Dylan Lewis: After the break, we've got surprises from the first half of 2023 and some things to keep an eye on for the rest of the year. Stay right here. This is Motley Fool Money. [MUSIC]. Welcome back to Motley Fool Money. I'm Dylan Lewis here in studio with Jason Moser and Matt Argersinger. This is our first show for the second half of 2023. I thought it might make sense for us to look back at the year that has been so far, and maybe also what investors can expect for the rest of the year. Let's start with the rearview. Jason, looking back so far on 2023, what is something that surprised you?

Jason Moser: Something that surprised me. We have probably even talked a lot about deserves more attention to the state of Disney today is not great. They are really going through some growing pains. The juxtaposition between Netflix and Disney share prices year-to-date and over the last 12 months is pretty fascinating. Year-to-date, Netflix up about 50%, trailing 12 months, it's up about 140%. Disney, 2%, and down 7.5% respectively. That's just fascinating to think about, particularly when you consider the enthusiasm. Not all that long ago is they were launching their streaming service. But you look at that. They got off to a great start with the streaming strategy and that was a lot of growth pulled forward very quickly for obvious reasons. The theatrical releases are not performing well. ESPN is in a state of chaos. The strategy there still isn't fully clear. Their mass layoffs. They've gotten rid of a lot of talent, restructuring the business. Now just yesterday we see word on the street is that Iger wants to extend his contract out beyond 2024 when it expires, guys, it's only mid-2023. I don't know about you, but that tells me that he realizes they've got a lot of problems and it's going to take a little while to fix them. To me, this has just been fascinating to see Disney go from such a wonderful story to not such a wonderful story.

Dylan Lewis: Jason, Disney is one of those cornerstone stocks where I think a lot of people start out early investing, buying them. I think a lot of people would look at Disney at $160 billion, company, look at Netflix at 195 billion and say, what gives. When you look at the business right now, is this something that hits value play territory or is it more value trap territory?

Jason Moser: It's a very good question. To me personally, I think it's value opportunity just because they've got too much going for it between the properties and in the IP and then the streaming platform. I think is going to take a while. I think the most would say opportunity, but they have to figure out the economics of the streaming business and that's going to take some time. But you've looked at the company day, it's valued around 23 times normalized full-year estimates, that's not crazy cheap either. You go back to 2019, they chalked up better than $6 in earnings per share. This year it's going to be half that. There is the dividend catalysts potential. They have had that dividends to spend for awhile. We expect that to resume it by the end of the year. I would imagine that the street will receive that news also.

Dylan Lewis: Matt looking over at the first half of 2023, what jumps out to you?

Matt Argersinger: I'm so surprised where we are today given what just happened in the spring, which is we had , Credit Suisse, First Republic, a few other smaller banks fail. There is real fear that we're going to have this financial contagion. Americans, especially small businesses, start to worry about things they really had not worried about in the past, like uninsured deposits. There are ear that banks are going to pull back for the lending market. There was the bogeyman commercial real estate in the office space, especially with all the debt that was coming due. Yet we are few months later and it doesn't seem like that risk is on any investors radar right now. To me, it just seemed very palpable at the time. Most banks have weathered the storm. The housing market has been incredibly resilient, despite mortgage rates being at multi-decade highs. I think to me that's the biggest surprise. We went through this really tumultuous time where there was just really big fears about the financial part of this market and the economy. It didn't come to bear.

Dylan Lewis: Shifting gears little bit to the future. Do you think that this is something that can materialize in the second half of the year and people should continue to be paying attention to?

Matt Argersinger: I think so. But the problem is, I think it's going to be very staggered and uneven. Yes, there are a lot of office properties that will be foreclosed on, debt will get extended or renegotiated. Some banks will have higher charge-offs. But it's going to be rolling across the economy and the markets as opposed to something that's happening all at once and dropping a big bomb on everything.

Dylan Lewis: Jason, as you're looking forward to the rest of 2023, what are you keeping an eye on?

Jason Moser: I think something to keep an eye on a student loan payments are set to start backup in October. Don't overlook this right there about 44 million with federal student loan debt today, the data I've been able to dig up says about 18% of those kept paying during the pause, which means a lot of people weren't paying over the last three years, estimate around $250 monthly bill and there's a lot of money that may not be going back into the economy, typically retail and services here, going into 2024. Then you add to that the excess savings that American households accumulated during the pandemic that has now essentially been depleted. It just puts the consumer in a tougher spot here going into 2024. Keep an eye on those impacts.

Dylan Lewis: Do you think that may factor into some of the credit crunch stuff Matt was just talking about.

Matt Argersinger: It absolutely could. I think it also could help bring that inflation number down because they definitely are correlated.

Dylan Lewis: Matt, what about you what are you looking out for for the second half of the year?

Matt Argersinger: Earlier last month, I should say on the show we talked about some of the parts of the market that really are participating in this rally that we've had. It's been a really impressive for alley. There's financials for obvious reasons. We just discussed energy, real estate. Momentum is a powerful force in the market so I'm not expecting big turnarounds here, but if you let me be a homer for a second, I have to. I think I'm going to zero in on commercial real estate. If you look at the XRE or the Vanguard Real Estate, ETF, real estate has just really underperformed, really for about 18 months now. It's trailing the market by about 1,500 basis-points depending on what measure you use. I'm that's partly justified. We know the situation with office real estate in this post-pandemic work-from-home world that we live in, but it is not a monolith. You've got industrial, you got hotels, retail, self-storage, datacenters, multifamily. A lot of these markets are performing really well. Barons actually had a really lengthy report this past weekend about some of the values they're seeing in the commercial real estate space. Office is a much smaller part of this one trillion-dollar public REITs market that we are in. It's around 3% now. If you think about what's happening in the industrial space, near-shoring, or what's happening in the multi-family space. The housing markets still going like bonkers. This is going to play off for years, but I think the Renaissance for commercial real estate starts in second half.

Dylan Lewis: Matt, Jason, we'll see you guys a little bit later in the show. But up next, we've got to look at the digital media landscape. Stay with us. This is Motley Fool Money. Welcome back to Motley Fool Money. I'm Dylan Lewis. Over the past two decades, few industries have changed as quickly as media, from blogging to the rush in social media and subscription, everything. Ben Smith has seen it all. He was a columnist at The New York Times and the founding Editor-in-Chief for BuzzFeed. Motley Fool Money's Deidre Woollard spoke with Smith about the cycles in digital media, his new book traffic, and how one legacy media company has managed to stay on top through all the shifts.

Deidre Woollard: I was excited to talk to you because I read this book and it was a bit of nostalgia for me. I worked at Weblogs, which was a Gawker competitor like early odds. You just capture so much of that energy in the moment, I think people sometimes they miss how revolutionary blogging was at the time. How do you feel that the professional first blog networks, how did they change the news landscape?

Ben Smith: Yeah, I feel exactly the same way and it's funny to think now because I think now when I tell people about blogs, particularly young people, I feel like I'm referring to some technology from the distant path.

Deidre Woollard: All right.

Ben Smith: Like we're blogging, there was this thing called blogging back in the day but no, I don't think I thought about it in quite such abstracts rooms at the time because I think when you were there, I was writing blogs for like the New York Daily News and the New York Observer. But similarly, this very new thing and fundamentally there for a long time, if you had some that you wanted to report on or say you needed either a printing press or a broadcast tower, you get it out. Suddenly you didn't and that was a big change. Then for me, it was like political scoops and reporting. There's just something so incredibly invigorating, but just talking directly to your sources, actually, in my case, and to your readers around the traditional distribution around your bosses and the editors and what they thought. It was very liberating and I think it was a very Utopian moment actually, like, I felt like this is the future and it's all positive.

Deidre Woollard: Though the early days of high traffic websites, so much of it as you talk about in the book, so much of it was about being sticky. How do you get people to stay around, be on the site longer, visit more frequently? Then that's the first wave. Then you've got the second wave that comes with social media changing all of that. How did that change the world of blogs?

Ben Smith: Yeah, well, let's see. They're right. There was this world that was intelligence. Some of the blogs were produce social media people had relationship with their commenters that were sometimes for better and for worse, like a little like Twitter and talk to other bloggers. A clunky way like I would write some attack and as recline and then I'd email us through and say, hey, I attacked you would you mind linking you and you and I link that I gave you a good link. Please link me back. If you were in that world as you were too like you really felt the traffic, the reader is the energy move to social media in this very tangible way, if you were living in it, suddenly everybody was over there and I found myself writing for Twitter, a writing blog post in the hopes that they would go viral on Twitter basically. I think in all these online publishers of that era into different theories saw that coming. Probably, the person who saw it most clearly was Jonah Peretti who created BuzzFeed and hired me in 2012. After this conversation, where at first he was talking about all this futuristic mumbo-jumbo. I didn't really understand. But the notion of a consumer who opens Facebook opens Twitter rather than opening your website really was where people in politics were already living and the notion of doing these organizations front-page was Twitter, which was what BuzzFeed news really launched as was very compelling for me.

Deidre Woollard: Let's talk a little bit about when you went to go work for Jonah because you weren't sold on the idea at first?

Ben Smith: Yeah. I think I looked at BuzzFeed and thought like, this is a cat website and what is news doing here? But I think the thing that Jonah Peretti had seen was that the early most amateur and silly beginnings of social content and social media, which were cap pictures and memes and site dominated by sites like nine gag, which you may remember like real bottom of the Internet. Weird copyright free zones that this world was starting to move into professional content and move up market and into news.

Deidre Woollard: Well, I think that's an interesting thing because you've got Gawker, which is doing both gossipy stuff and then trying to do news. Buzzfeed has that beginning in cat videos and top 10 lists and things like that, and then evolves into a more serious base. You start to get things like Huffington Post winning Pulitzer's. What was that marriage like between the traffic getting stuff and the more serious stuff?

Ben Smith: I would say at first it had this really clear logic to it. Like wow, like Facebook, Twitter, they're swallowing everything and let's do news. By the way, consumers love it. Consumers think it's cool that on their Facebook page there's a New York Times article and a picture of a cat and an update about their friends kid like what a fun mix. I think there was this period when the Facebook news-feed in particular was a fun novelty that people liked, Buzzfeed was built to reflect that content mix and God bless. I think the thing that ultimately, I think those publishers and Facebook never really recovered from, was at some point that just turned into this nightmarish really toxic Stu that nobody really wanted a part of. Consumers, ultimately more than business types or journalists said, hey, wait a second, we would like to sort these things out. Facebook bumble's around for a while, does a lot of damage, but ultimately response essentially by throwing news off the platform. Like if you open your Facebook feed, you're not going to see any news now. I think the drew that direction of travel changed very abruptly for reasons that had, I think a lot to do with the politics and culture of the 2010s which they fed that also were very shaped by.

Deidre Woollard: How did Jonah Peretti adapt when that started to happen?

Ben Smith: I don't think any of these companies adapted successfully. I think if you look around now, universities trading and $0.50 and being threatened with delisting Vice. What is collapsed into one of its lenders essentially as he's going to own it. You go through the roster of those companies and they were basically a bad on a certain kind of future for digital in which digital would be like Cable. Content companies would build on the backs of distribution companies and share the winnings, and the distribution companies had no interest in sharing the winnings. Then the distribution companies themselves, I think will not endure as long as Cable did or has. I think when you say like these big fundamental pieces of that vision didn't work. You can then I think all these companies and Jonah and I and others made all mistakes. But it's actually hard. The fact that they've all come to the same place suggests that they are a bigger challenge.

Deidre Woollard: Well, you also talk in the book about the New York Times, and you talk about that moment where it was floundering. Now it's reinvented itself. What do you think the Times eventually figured out about doing new media?

Ben Smith: It's so interesting, like I went out to write this book about the birth of Internet media, and the winner turns out to be the New York Times where I was at the time actually depressing. But no, it was interesting. This is a business story. There is this strategy in the business world, a fast following. You know that you can win, you don't have to be first, if you follow fast, and the Times did not do that, they followed slow. They watched other places, notably the Washington Post flail around chasing Internet gurus and Internet trends. They plused a lot of money, they preserve their like core value proposition, which is great journalism. They essentially waited out the period in which it was impossible to do a subscription business on the Internet and that wasn't like a cultural shift hopefully Netflix and Spotify and particularly trained people to pay. The Times had been patient, had retained its relationship with its readers, retained its brand. Sell-off assets was essentially a release out floors their building. They were throwing the furniture into the fire to keep the lights, to keep the room warm. But ultimately emerged with this incredibly strong subscription business then build around that in some ways, reassembled the old news bundle and built crosswords, and cooking, and in a weird way, it's like all the stuff that you used to get an a prints Sunday paper.

Deidre Woollard: Do you think there's any lesson we can learn from the way that online content has evolved into maybe how streaming is going to shake out.

Ben Smith: That's a really great question that I don't have a clear answer to. Actually, I think people tend to overall learn the lessons of the last one.

Deidre Woollard: Indeed.

Ben Smith: I think the overlearning what was advertising is terrible and dead. Subscriptions are the only possible business for media. They are pure and good. You saw that in streaming, you saw that in Substack world. Then they learned the old lesson that incremental subscription business gets harder and harder, and growth gets really hard, and inexpensive and churny. The advertising business is actually like it has a lot going for it. I actually think the media business is tough business. You got to be really connected to an audience, really telling people interesting things for them, and then pretty like non-ideological about revenue. I think that's what the big media companies are now realizing having had this blinkered ideology about the only possible business is subscription.

Deidre Woollard: Thinking over all about traffic in general, that's like you call it yet the tide of human attention and your book cover has this waved. Like taking that wave idea, Pfizer blogs, social media, newsletters we talked about is the next wave video content. Is it something else? Is it the metaverse? I don't think it's the metaverse, but it's [laughs] What might it be?

Ben Smith: I think the news business is you have to be clear with these other what we're talking about, and I think obviously short video is this dominant medium right now. TikTok, huge. But if you're trying to get really useful information about equities or understand what's happening in AI or in politics, short video isn't necessarily the best way. Text remains a pretty useful technology. Audio is useful, and so I'm not sure. There will no doubt be very cool things in the metaverse, but the news among other things, just isn't the most lucrative business in the world. It's not going to be the one building the most elaborate three-dimensional spaces for us all to live in.

Deidre Woollard: Given that news isn't the most lucrative business, what is it about it that has kept you going at it and coming back to it and still being excited about the next story.

Ben Smith: Man, I'm just a total junkie. Like I love scoops. I like knowing what's going on, wake up every morning totally curious. We did probably like lowest stakes journalism that you're going to do. We covered the advertising conference in Canada last week, which was interesting and useful. But this media newsletter that i right with Max Tony, and at some point I was like there and Ken, about 1:30 in the morning cheerfully like editing the newsletter and he's like, we were sharing an Airbnb. He's like I'm going to sleep, what are you doing? He's like, I think I would probably do this if nobody paid me. 

Deidre Woollard: Nice.

Ben Smith: Like I'm having a good time. Actually, that is something that I think I took, and maybe you did too from that early era, which it was amateur.

Deidre Woollard: It was definitely amateur.

Ben Smith: Like in the sense of that word. That like you're doing it because you love it. It didn't feel like it was you were making car widgets for a factory. Like you were talking directly to people who are interested in what you would say.

Dylan Lewis: Ben Smith's book, Traffic, is out now and you can catch Ben's latest efforts at semafore.com. Coming up after the break, Jason Moser and Matt Argersinger return with a couple of stocks on their radar. Stay right here. You're listening to Motley Fool Money. As always, people on the program may have interest in the stocks they talked about, and the Motley Fool may have formal recommendations for or against them, so don't buy or sell stocks based solely on what you hear. 

I'm Dylan Lewis joined again by Jason Moser and Matt Argersinger. We're going to get to our radar stocks in a second but first, Amazon's Prime Day is next week and we're getting an early look at deals ahead of the official start on July 11th. Jason, as you're thinking about Prime Day and you're thinking about Amazon's business and these two things coming together, what are you paying attention to?

Jason Moser: It's nice when you can just hit a switch and turn on sales like Amazon can, and it's pretty impressive. Amazon Prime now has over 200 million prime members around the world and the US accounts for around 75% of that total. Maybe it's a little bit saturated here, but certainly plenty of global opportunity. But to give you an idea of what Prime Day means to the business, it's not insignificant. Sales during Prime Day in 2022 reached over $12 billion. The average prime subscriber spends about $1,400 per year. When you look at this and couple that together with the fact that Prime really it's only available in 23 countries, which I honestly thought it was more, but maybe that also speaks to the opportunity that's still out there.

Dylan Lewis: Matt, Jason mentioned that we're starting to see a little bit maturity in North American market. When you look at Prime and its role with Amazon, is this a loyalty play? Is there something else that people should be factoring in here?

Matt Argersinger: Yeah. It is loyalty play and if you look at the retention rates are amazing. For US members, it's 93% renew their Prime membership. It might be reaching a point where it's no longer really a growth opportunity in the US, but that's OK. I think Costco is an example of where the membership ranks aren't really growing there either. But the reliable cash flow, but the spending that those members bring, and the pricing power that Amazon and Costco have within for those members is still really powerful. It's fine if that is the future for the business is just a retention cash flow, at least for the US.

Jason Moser: With Costco, the focus on the member. That's one thing they do so well. I think Amazon does that pretty well also. It's just the focus on the member, so important.

Dylan Lewis: You got to be obsessed with the customer experience.

Matt Argersinger: They've well pulled that.

Dylan Lewis: It's the founding idea of Amazon. Let's get over to stocks on our radar. Our man behind the glass, Dan Boyd is going to hit you with a question. Matt, you're up first. What are you looking at this week?

Matt Argersinger: I got to give credit to my man, Tyler Crowe, a longtime Fool contributor. He mentioned this one to me earlier this week. Vesta Real Estate, VTMX is the ticker. It's a new IPO to the US market. They listed their American depository shares just at the end of June. It's the largest US IPO by a Mexican company and more than a decade. That's according to Bloomberg. Vesta is a major developer, operator of industrial real estate in Mexico, so think industrial parks, warehouses, logistics, light manufacturing. More than 200 properties, a 33.7 million square feet, occupancy rate of almost 97% as of the end of March. If you think about the trends of bringing back manufacturing capacity in North America, near-shoring, supply chain redundancy, there's a huge need for that space and Mexico is the perfect place for North American manufacturing. You've got a business that is really growing impressively, pays a nice dividend. I think it's a company that's in the right spot and now at the right time for US investors.

Dylan Lewis: Dan, a question about Vesta Real Estate.

Dan Boyd: Not really a question, Dylan, more of a comment. I think bringing a week-old stock to stocks on our radar is cheating, as what could be more interesting than a brand-new big IPO?

Dylan Lewis: Yeah. his got a good point here.

Jason Moser: Love that, Dylan. Love it.

Matt Argersinger: At first it was going to be like a back-end company.

Dylan Lewis: It was good by ripped.

Matt Argersinger: I thought he was going week-old as in like me. I'm weak and old. [laughs]

Dylan Lewis: Well, I think what he's doing is he's teeing you up for a very hard pitch here, Jason, for your stock.

Jason Moser: It's always a hard pitch with Dan. Like his comments and not his questions. His questions are difficult to answer. But Dan, I'm going to give this one a wall here. Hopefully, you've been to top golf before, but my radar stock this week is Topgolf Callaway Brands. Ticker is MODG. Dan, what I'm not thumbing through the latest issue of watercolor artists, I'm likely catching up on the latest issue of Golf Digest. Exciting stuff I know, but I found a fascinating data point just the other day in reading through my latest issue of Golf Digest. I'm not even lying here, guys. I'm really like that. The National Golf Foundation noted that for the first time ever, the number of off-course golfers has surpassed the number of on-course golfers. Now, an off-course golfer is someone who likes to hit golf balls and likes the game of golf, but they don't want to go playing a round of golf on the golf course. Whereas like, I love to go play golf, so you're going to catch me on the golf course. But there are a lot of folks that just love to go hit golf balls, so they would be on versus off. But of the 41.1 million total, there are 15.5 million off-course golfers versus only 13.2 million on-course. The remaining is a combination. Like I would be on-course, off-course. I like to go to top golf and I like hybrid. I don't think [OVERLAPPING] so I love it all, man. I don't think this is an outlier, though. I think this is a trend we may see continue, and I think a driver of this trend, see what I did there. I think a driver of this trend is Topgolf, which Callaway acquired a couple of years back. Callaway is a keystone brand in the golf world, I hate Callaway irons, Mattie. Hell no. I use an Odyssey.

Matt Argersinger: You're a man of the sport. That the brand.

Jason Moser: Bringing Topgolf into the mix here, I always thumb my nose at golf as an investment. Having the experience in the industry, I know it's a tough game, it is an expensive game. But bringing Topgolf into their universe, I think gives them an opportunity to grow in a different direction. Think like a Dave and Buster's for golfers, which I think is just very fascinating. It takes golf beyond just that traditional on-course golf demographic. I'm digging more into Topgolf Callaway Brands here to see if it's worthy of a recommendation.

Dylan Lewis: Dan, a lot of narrative flare, a lot of personal experience there. A question about Callaway Golf.

Dan Boyd: No. I have a comment, so Jason will enjoy this. I am not an on-course golfer. I've actually never played golf on course. But I've been to Topgolf many times.

Jason Moser: So he's an off-course golfer.

Dan Boyd: Yeah. If you guys ever want to go see a grown man swing a golf club like a baseball bat, because I have no idea what I'm doing, let's go to Topgolf.

Jason Moser: I'm all in.

Dylan Lewis: Sounds like we have similar technique, Dan. Which company is going on your watch list, Dan?

Dan Boyd: I'm sorry, Jason. As much as I love Topgolf, I just love a new IPO, especially one as big as Vesta.

Jason Moser: Nice

Dylan Lewis: Guys. Jason, Matt, thanks so much for being here in bring your stocks on the radar. That's going to do it for this week's Motley Fool Money radio show. This show is mixed by Dan Boyd. I'm Dylan Lewis. Thanks for listening. We'll see you next time.