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Illustration: Sarah Grillo/Axios
Amid the worst stock market plunge since the financial crash, stark new questions are arising about the concentration of global profit and wealth in a few "superstar" firms, and the economic power that they wield.
One of the concerns about Google, Facebook, Amazon, Apple and others is the historic scale of wealth at the apex of some industries, alongside decades-long wage stagnation for the middle and lower classes.
Driving the news: In a new report, McKinsey Global Institute points out that so-called "superstar companies," the 10% most valuable firms across industries around the world, are not only extraordinarily profitable, but are profitable compared with prior superstars.
In short, today's big companies are dominating the economy to a degree not seen since the Gilded Age in the late 19th century, says Tim Wu, a law professor at Columbia University.
The big picture: Economists have increasingly linked market concentration with nagging economic problems, such as the stubbornness of relatively flat U.S. wages despite 3.7% unemployment, the lowest in almost a half century.
Many economists link the superstar companies to stark inequality in the economy. Companies are so big that they can suppress wages, especially in more rural areas with relatively few places to work.
McKinsey also thinks something fishy is going on economically — but in the bottom tier of global companies, not necessarily the top, according to Sree Ramaswamy, co-author of the report.
Once-enormous Black Friday lines are shrinking. Photo: Hector Mata/AFP/Getty
Americans are spendings less and less money in brick-and-mortar stores during the run-up to the holidays, shunning the crazy lines they once formed outside big-box stores on Black Friday.
Erica writes: Shoppers plan to spend 57% of their budgets online but just 36% in physical stores, per a new Deloitte survey. Just 44% of shoppers say they will shop on Black Friday as much as in past holiday seasons, while 53% say they will buy on Cyber Monday, three days later.
The big picture: For many Americans, the idea of one big shopping spree coinciding with a work holiday is fading, yet at the same time they have higher holiday budgets.
The steady decline of Black Friday is a victim of online shopping for gifts, says Rod Sides, the head of retail at Deloitte.
But e-commerce giants are not the only ones profiting from this sea change. Traditional retailers — especially clothes shops — are still making a killing before Christmas, but the bulk of their sales are moving to the web, according to Deloitte.
The bottom line: One reason e-commerce thrives during the holidays is that gift shopping is often easier online, according to Sides. "If I'm buying for folks in my extended family, I don't know what size they wear anyway. So I might as well buy online and take my best guess."
Photo: Hank Walker/LIFE/Getty
You barely read any news this week? Catch up on this week's top stories at Future:
Illustration: Sarah Grillo/Axios
An AI cold war that could doom us all (Nicholas Thompson, Ian Bremmer — Wired)
The outrage over insulin profiteering (Bob Herman — Axios)
The anarchy that came (Robert Kaplan — National Interest) (h/t Ed Luce)
The trust crisis in business may be receding (Claire Zillman — Fortune)
A quiet detente between China and Japan (Jonathan Pollack — Brookings)
Microsoft will work with U.S. military on AI (Ina Fried — Axios)
Photo: Hiroshi Ishiguro/Osaka University/ATR
On the Tinder for robots, you don’t swipe left or right — you instead rate them on likability, appearance and overall desirability. Too many bad "appearance" ratings, and a bot lands in a modern hall of shame: the World’s Creepiest Robots.
Kaveh writes: Today’s most useful robots are giant arms that assemble cars and smartphones in enormous factories. But in the near future, robot builders want to make social bots that elicit empathy from people.
But first, they have to figure out how to make ones that aren’t totally horrifying.
Telenoid, a milky-white, nearly featureless robot that appears ready to feast on human souls, enjoys the top spot on the Creepiest Robots list.
All five creepiest robots have human-like faces, but dead eyes and weird dull skin that shove them deep into the "uncanny valley," a term used to describe the dreadful quality of robots that try to emulate human features but fall short.
"Creepiest" is just one way of sorting IEEE’s catalog of nearly 200 robots. Choose to sort by "Top Rated" and you’ll see a very different set of machines. Tellingly, none are humanoid: The top two are animal-like bots, and nearly all the rest in the top ten bear no resemblance to living things.
Go deeper: Rate some bots!