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In today’s business news: Yes, your cereal boxes are shrinking; a $30 billion insurance merger gets called off; and Philip Morris wants to ban cigarettes in the UK.
Forget intermittent fasting and keto. Shrinkflation is here to help you shed your quarantine weight.
Here’s how it works: You don’t have to do anything, just keep buying the same groceries and let the food manufacturers do the portion control for you. Because while you’ll still be spending the same amount, you’ll be getting just a bit less than before.
Shrinkflation, of course, is not a fad diet — it’s a sneaky little tactic used by companies when their production costs go up (and the recent inflation surge has done just that). Rather than change the price of a box of Cocoa Puffs, General Mills can simply reduce the number of puffs in the box by an ounce or so. You pay the same price, because of course, and then the company can offset the increase in their expenses.
Yes, this is legal, and no, I don’t know why — it’s capitalism, baby, just roll with it. My colleague Nathaniel Meyersohn has more on the current shrinkflation.
NUMBER OF THE DAY
A proposed $30 billion insurance industry merger has been called off just a month after the Justice Department’s antitrust regulators sued to block it. The deal between Aon and Willis Towers Watson would have created an industry behemoth, and the DOJ argued that the merger would lead to higher prices and less innovation. Its dissolution is a major win for the Biden administration, which has taken a far more aggressive stance toward antitrust cases than its predecessors.
TALES FROM CRYPTO
Cryptocurrency buzz has gone from a low hum to a 2021-style cicada swarm. The reason why has less to do with the viability of cryptos as mainstream tender but rather the fact that Amazon is, apparently, paying attention.
Amazon listed a job opening for a “digital currency and blockchain product lead.” The posting, which went up Friday, says the company is looking for someone with a “deep understanding” of the “cryptocurrency ecosystem and related technologies.” (Translation: We’ve heard a lot about this crypto thing and we’re honestly so confused, so please come work here and make sure we don’t look like dum-dums.)
The role would be part of Amazon’s payment acceptance and experience team, according to the job description, perhaps implying Amazon wants to accept cryptocurrencies as payment. That would take the nascent market digital currency sector deeper into mainstream commerce and give it the legitimacy that its advocates say is overdue.
Bitcoin climbed to a six-week high of nearly $39,043. As of Monday afternoon, both bitcoin and dogecoin had soared more than 14% over the previous 24 hours, according to Coinbase. Ethereum went up nearly 12% over that period.
QUOTE OF THE DAY
“With the right measures in place, [Philip Morris] can stop selling cigarettes in the UK in 10 years’ time.”
— Moira Gilchrist, head of strategic and scientific communications at Philip Morris International
Philip Morris International — yes, that Philip Morris — wants the UK to treat cigarettes like gasoline-powered cars, the sale of which is due to be banned from 2030. The company, which makes Marlboro cigarettes and whose name was once synonymous with Big Tobacco, added on Monday that it “can see a world without cigarettes.” CNN Business’ Hanna Ziady has more.
WHAT ELSE IS GOING ON
- Tesla reported a record net income of $1.1 billion in the second quarter, up more than 10 times what it made a year ago.
- Just 17 million people in the United States watched the Olympics opening ceremony on TV — down 36% from the Rio Games. But streaming figures were up 72%.
- Chip giant Nvidia is the ninth-most valuable company in the S&P 500. Now there’s a strong argument that it should join the Dow.
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