🌎 Starbase

Warren Buffett retires after six decades at Berkshire Hathaway

The man known as “the Oracle of Omaha” will go down in history as one of the world’s greatest investors. During Berkshire Hathaway’s annual shareholders meeting, the 94-year-old announced he would be stepping down as CEO of the company by the end of the year, shocking the business world.

The yearly meeting, often referred to as “Woodstock for capitalists”, began with just a dozen attendees and has since grown to a weeklong event, attracting over 40,000 people, and is closely watched by investors around the world.

A historic career

Warren Buffett, a lifelong resident of Omaha, Nebraska, took the reins at Berkshire Hathaway in 1970 when it was a failing textile business and transformed it into a $1.1 trillion conglomerate, now considered one of the most successful companies in modern American history.

• Today, Berkshire Hathaway has stock holdings in 189 companies, such as Apple and Coca-Cola, and owns 73 companies, including Geico, Duracell, and Fruit of the Loom.

Warren Buffett is known as the Michael Jordan of investing for a reason. He’s known for his commitment to value investing, which prioritizes finding undervalued stocks, and his unrivaled patience, which has generated a windfall of returns and inspired millions.

• Since Buffett took over in 1965, Berkshire Hathaway’s stock has increased nearly 20% annually.

• After 60 years, Berkshire’s stock has skyrocketed 5,502,284%.

• Buffett’s been so good that the company’s stock could crash 99% and still outperform the S&P 500, which has an average return of 10.4% a year.

If I were to go on to list his many achievements, this article would never end.

Buffett is widely regarded as the most successful investor in history, not just for growing Berkshire Hathaway into the world’s largest holding company, but also for inspiring millions who follow and embrace his investment philosophy.

So, what now?

Business leaders worldwide were stunned by Buffett’s retirement announcement in the final moments of Berkshire’s annual shareholders meeting, reacting to his decision. However, none more shocked than Greg Abel, who Buffett named as his successor.

• Abel has served as vice chairman of the company since 2018 and is Buffett’s right-hand man.

What will Abel do first? One of the biggest questions is what to do with Berkshire’s $350 billion cash stockpile, which was built up as one of Buffett’s last strategic moves before he left his position.

Buffett will still have a role in the company: The day after he announced his retirement, Berkshire Hathaway’s board voted unanimously for Buffett to remain as chairman. While he didn’t specify if he’d relinquish this title as well, Buffett did say he’d “still hang around” and could still be “useful in a few cases.”

SpaceX officially got its own city in Texas

Every day we get closer to Cyberpunk 2077. Over the weekend, hundreds of voters in Texas approved the establishment of a SpaceX city, which will now operate as its own municipality.

Celestial city

The town, located on Boca Chica Bay in South Texas, doesn’t really have much besides rocket manufacturing facilities, SpaceX launchpads, and employee housing. It has hosted the company’s operations for years, and more than 500 people currently reside within its proposed boundaries, the majority working for SpaceX.

On Saturday, with an overwhelming 212-6 vote in favor of incorporation, Starbase was made an official SpaceX city:

• It can now establish its own zoning laws, generate revenue, hire local officials, and close roads for rocket launches.

• The vote also elected the town's first mayor, engineer Bobby Peden, along with two commissioners, all of whom are SpaceX employees or their family members.

The 1.6 square mile plot of land was essentially all but sand before SpaceX CEO Elon Musk chose the southernmost tip of Texas as the testing site for its 400-foot-tall Starship—the world's largest and most powerful rocket—in 2018.

Believe it or not, Starbase isn’t the first US corporate city: Though unusual in 21st-century America, a population center controlled by a company has been seen many times before. For example, Pullman, Illinois, was founded by the Pullman Company in the late 1800s and offered housing, schools, and other amenities to its workers.

Would you get an eye scan in exchange for cryptocurrency?

Doesn’t matter; millions of people have already. The metallic, eye-scanning orbs—which are supposedly used to protect against fraud—are officially coming to the United States.

The device, co-founded by OpenAI CEO Sam Altman, creates a unique user ID and gives you a cryptocurrency called Worldcoin (WLD) after you allow it to scan your iris.

It was supposedly made to help verify people’s identity and protect against bots, but I can’t help but think…

We’re in a Black Mirror episode

In 2023, the World project, formerly known as Worldcoin, went online in other countries internationally. Last week, the technology was introduced in the US at six flagship locations, allowing people to run wild:

• So far, over 12 million people internationally have already gotten scanned, according to Tools for Humanity, the company behind the World project.

The venture has already established partnerships with Visa and online dating giant Match Group, the company behind Tinder. Visa will be introducing its “World Visa Card” this summer, which is only available for those who have been scanned, and Match Group will roll out an age verification system using World ID in Japan.

How does it work?

You simply approach an Orb and it will scan your face and iris in just 30 seconds to create a unique ‘IrisCode’, which verifies you're a human and haven’t signed up before.

• Upon completion, you’ll receive free WLD cryptocurrency and can use your World ID to sign in to platforms like Minecraft, Reddit, Telegram, Shopify, and Discord.

But will they uphold your privacy? It’s hard to say, especially since more than a dozen jurisdictions have suspended World’s operations or investigated its data processing, despite the venture saying it’ll keep your data private, the WSJ reported.

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McDonald’s faces its worst sales drop since 2020

The day has arrived when many realize they do, in fact, have food at home. The fast food giant reported its worst decline in US sales since the height of the pandemic in 2020, announcing a 3.6% drop in sales last quarter. However, McDonald’s isn’t the only fast food chain that’s suffering.

Unhappy meal

The dip marks the second quarter in a row McDonald’s $MCD ( ▲ 0.44% ) has had falling same-store sales in the US, largely due to consumers pulling back spending amid economic uncertainty (see explanation).

• According to the company's CEO, Chris Kempczinski, the customers who tightened their budgets the most were those in lower—and middle-income households.

McDonald’s isn’t alone in its sales slowdown, either. Chipotle, Starbucks, Pizza Hut, KFC, and Domino’s all saw US sales drop in the first quarter of this year, pointing to a larger trend in consumer spending:

• Last quarter, consumer spending grew at its slowest rate in two years, according to two reports released by the Commerce Department last week.

It might get worse for the Golden Arches: According to a company official, an uptick in “anti-American sentiment” throughout northern Europe and Canada could affect international sales going forward.

Now might be the best time to book a flight (within the US)

Airplane tickets? Cheap? What? Although 'cheap' may not be the right word for flights these days, 'cheaper' might be more fitting, as economic uncertainty is causing potential travelers to skip out on vacations.

Flight risk

As economic conditions get harder to predict (not that it was ever easy), would-be vacationers are opting to stay in rather than fly out, causing airlines to have too many seats on their hands.

Several major airlines pulled their optimistic forecasts for the year as travelers second-guess vacation plans, leading to, well, cheaper tickets:

• In March, airfare fell 5.3% from the year before, according to data from the Bureau of Labor Statistics.

• Part of this could have been since Easter, a peak travel period, was in March last year; however, ticket prices also fell 4% in February of this year.

Airlines say that even business travel, usually a major source of revenue, is doing poorly, which was confirmed by companies who told the WSJ they’re being more conservative with their travel spending.

What does this mean for you? It likely means airfare discounts are on the horizon… but only if you’re looking to fly domestic. Americans are increasingly flying overseas, as a total of 6.56 million US citizens flew internationally in March, a 1.6% increase from last year and a 22% rise compared to 2019.

FAST FACTS
Catch up on this week’s weird news

Prehistoric Purse: A collection of luxury brands and biotech businesses claims to be producing the first handbag made of Tyrannosaurus Rex leather by using collagen extracted from ancient fossils.

Diddy Detention: Jury selection for Sean 'Diddy' Combs' trial began yesterday in New York City. Combs, who has been in custody since September, faces criminal charges including sex trafficking, racketeering conspiracy, and transporting individuals for prostitution.

Coin Flip: Last week, a semi truck carrying 8 million brand-new dimes (over $800,000 worth of coins, if you're curious) flipped over and spread across a Texas roadway, forcing a 14-hour closure.

Disney Drugs: A guest was taken into custody after trying to enter Disney World's Magic Kingdom with what authorities claimed was a "wallet full of cocaine."

Vacation Voucher: After retiring last year, a dentist from a California prison earned $1.2 million by trading in his thousands of hours of unused vacation time.