⛽ Europe's energy crisis

1. Europe’s energy crisis could get a lot worse as Russia’s gas-withholding moves threaten the global economy

All dried up… Europe’s at the boiling point of an epic energy crisis as political tensions and record heat waves ripple through the continent. This week, Russia’s Gazprom (the biggest natural-gas company by sales) halted exports to three major European customers citing force majeure — a stoppage for extraordinary circumstances. Europeans aren’t buying it:

• Hot air: Uniper, Germany's largest gas importer, said the halt was “unjustified” (read: Gazprom has gas to spare). Uniper’s already tapped a $2B credit line and drawn down winter reserves to keep Germany’s gas-fueled electricity and A/C flowing.
• Heat-pocalypse: Yesterday, the UK had its hottest day ever recorded, while the Netherlands had record July temps and France sent out extreme-heat warnings.

Pipe problems… Russia supplies nearly half of the EU’s natural gas. Problem: over the past month, Gazprom’s cut its export capacity to 40%. The Nord Stream pipeline (the main connection between Germany and Russia) closed last week for an annual maintenance check. But Europeans worry that the force majeure signals Russia won't reopen its taps by tomorrow’s deadline. And Europe’s gas prices are already up 8X from a year ago.

THE TAKEAWAY

Europe’s crisis could be a global disaster… This year, Europe has surpassed Asia as the top importer of US oil for the first time since 2016 (because it’s getting way less gas from Russia). But US production isn’t growing fast enough to meet the needs of both continents and its own. Eventually, the energy crisis could cost European taxpayers $200B through higher energy bills and higher taxes. Globally, a tighter gas market could trigger more inflation, hurt economic output, and fuel a recession.

2. Amazon sues 10K Facebook groups over brokering fake reviews, as phony five-star operations erode customer trust

"Amaaazing quality, feels like silk"... probably a review for that paper-thin polyester Amazon PJ. More than a third of Amazon reviews are estimated to be fake or unreliable. Now the Zon is taking legal action to crack down on fake five-stars: yesterday, Amazon filed a suit against administrators of 10K+ Facebook groups it accuses of brokering bogus reviews in exchange for money or free stuff.

• Admins of one group are accused of charging Amazon sellers $10 for each good review. Another group, "Amazon Product Review," amassed 43K+ members before being removed.
• Many of the groups are private, and posters try to evade moderators by omitting letters (think: “Rfund Aftr Rvew.”)
• Amazon wants the groups to shut down and return their “ill-gotten gains.” Facebook owner Meta has removed half of the groups reported — and is investigating others.

Bluetooth headphones and supplements... some of the hardest-hit categories for fake reviews. Phony write-ups have become a growing headache for Amazon, whose marketplace now includes millions of third-party sellers. It's not just a Facebook problem: illicit review communities have thrived on social apps like WhatsApp, Telegram, and WeChat.

• Moderate: Amazon has said that it uses a mix of AI and human moderators to hunt fake reviews, and has reported thousands of groups to social companies.
• Spiral: Still, thousands of bogus reviews keep cropping up across the Zon’s massive storefront — and sneaky sellers and review brokers are cashing in.

THE TAKEAWAY

Phoniness is a trust-killer… Amazon isn’t the only one plagued by the fake-review biz: Yelp, TripAdvisor, and Google have the same problem (see: non-existent restaurant hits #1 on TripAdvisor). Five-star reviews might be the reason you spend your hard-earned money on something. Misleading reviews could cause you to lose trust in a platform, threatening review-reliant businesses like Amazon.

What else we’re Snackin’

• Muskular: Wake us up when September ends: a judge ruled Twitter’s trial against Elon will start in October. Experts say there’s a good chance Musk will be forced to buy Twitter.
• Binge: Netflix dodged a bullet: yesterday it reported that it lost fewer than 1M subscribers last quarter, far fewer than the 2M it had predicted. The stock jumped 8% on the “good” news. Ads are next.
• Streamy: YouTube’s evolved since “David After Dentist”: The Google-owned platform partnered with Shopify to let creators host shoppable livestreams, which have gained popularity on Amazon and Insta.
• Battle: Demand for defense tech has been rising since the Russia-Ukraine war began. But this week the top-earning defense biz, Lockheed Martin, lowered its sales and profit forecasts on supply and labor clogs.
• Fine: After a year-long investigation, Chinese regulators will reportedly fine ride-hailer Didi $1B over breaking cybersecurity rules. On the plus side, it’ll finally be able to accept new users again.

Snack Fact of the Day

Wednesday

• Earnings expected from Tesla, Abbott Labs, and Nasdaq

Authors of this Snacks own: shares of Shopify, Amazon, Netflix, Tesla, Google, and Twitter

ID: 2301994