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Books are back
British publisher Bloomsbury, which was the publisher behind the Harry Potter series, revealed this week that sales were surging in May and that 2021 was its best ever year, with sales rising 24% to £230m. The success of one individual publisher is complemented by wider industry data — NPD BookScan estimates more than 825 million print books were sold in the US last year, up 9% on the year before.
The fact that book sales got a bump during COVID, as we spent more of our free time at home, was perhaps expected — but it wasn't clear if the reading boom would last. It seems it has.
Interestingly, social media platform TikTok has played its part, with communities cropping up to discuss the latest books on #BookTok — a hashtag which has 58.5 billion views associated with it according to the platform.
Have you read all those books?
Keen readers of this newsletter may remember we cited a Gallup poll from December earlier this year, which showed Americans were actually reading fewer books than they were in 2016. Without year-to-year data it's hard to know for sure, but that suggests that we may have collectively liked the idea of reading more but never got around to actually doing it. Got a book (or a few) that you bought recently that's sat on your shelf that you just couldn't get into? You're not alone.
The Lego factory
This week iconic toymaker Lego announced its plan to build a new 1.7 million square-foot factory in Virginia, creating up to 1,800 jobs once complete. The Danish company plans to spend $1bn on the factory, which is an enormous investment for any company, let alone one that produces such a simple product.
But selling a simple product, and doing it really, really well, has been the cornerstone of Lego's remarkable business model. Sales last year jumped 27%, a number that some cash-burning tech companies would have been happy with.
All told Lego sold ~55bn Danish Kroner worth of plastic bricks in 2021, squeezing out a 31% margin on those sales thanks to the company's iconic brand and build quality, with a reported manufacturing error rate of just 18-in-a-million.
In USD Lego sales work out to around $7.8bn — suggesting that its factory investment, which will presumably be spread over 3 years, will only cost around ~4% of Lego's sales over that period. Lego is betting big that playing with plastic bricks is here to stay. They're probably right.
The average interest rate on a fixed 30-year mortgage has hit 5.78% in the US, jumping 0.55% on the week before — which is the sharpest one-week rise since 1987.
Cooling off
The sharp upward movement, which has seen rates almost double in just 6-7 months, is a big deal when you account for the fact that house prices themselves are still near record highs. High prices, and now high(er) rates = a record drop in housing affordability.
More expensive mortgages are likely to curb demand for houses, which in theory should take some of the heat out of the red-hot housing market. That said, rates in the US are still not particularly high relative to much of recent history. In 2000 they were up over 8%. In the late 80s they were 10-12%.
1) A new report shows that the world's workers are still mega-stressed. 44% of employees surveyed experienced a lot of daily stress in the previous day of work, up from 31% in 2009.
2) The news that K-pop group BTS are to take time-off to focus on their own music wiped $1.7bn from the valuation of label HYBE in trading on Wednesday.
3) A Game of Thrones spin-off, focused on main character Jon Snow, is reportedly in early development. Producers will be hoping for better ratings than the final season of the main show.
4) Robotics have already transformed production lines in engineering and heavy manufacturing, and now they're disrupting the food industry. Invest in Miso Robotics and help build the kitchen of the future.**
5) An animated visualization of the most popular websites since 1993.
6) It's pride month! The latest data shows that LGBT identification in the US rose to 7.1% of the population last year, up from 5.6% the year before.
7) Want a deeper dive into business and investing news? Check out our friends at The Daily Upside. Written by a former investment banker, it’s a newsletter that delivers quality insights to make you smarter — sign up for free here.
8) The weird and whacky creations of AI art generator Dall-E-Mini have been taking the internet by storm.
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