The Economist is my favorite publication. Its special report on the US Midwest was so good I had to write about it. 

I consider myself well-versed in business chatter, but the facts definitely surprised me. In my defense, I have an excuse: I’m Canadian 😂

It’s overlooked, but it’s huge

As our colleague Zack has noted, as of 2018, the Midwest was responsible for ~20% of America’s GDP, but it received only 5% of venture funding.

With a total population of 68m, the 12-state region’s total GDP (~$4 trillion) is larger than either Germany or the UK. 👀

And it’s home to monster companies

Many rank at the top of their sectors in the US:

• Caterpillar (market cap = $73B) is one of the 6 largest industrial companies. 
• General Motors ($38B) and Ford ($27B) are the largest non-Elon Musk owned car makers.
• Procter & Gamble ($329B) is the 2nd-largest consumer defensive firm (after Walmart).
• UnitedHealth Group ($298B) is the 2nd-largest healthcare company (after Johnson & Johnson).

It’s got serious brain power, too

We’re talking “16 of the country’s 50 top-ranked medical schools, five of the 25 best computer-science ones, and 17 of 63 leading research universities,” The Economist says. 

Big Ten universities pull in annual research funds of $10.6B (more than the combined haul of the Ivy League and California universities).

A 2019 Brookings Institution report argued that money and resources should be spread to new innovation hubs. Six of the report’s top 15 “potential growth centers” were Midwestern:

• Madison, Wisconsin
• Minneapolis-St.Paul-Bloomington, Minnesota
• Columbus, Ohio
• The Chicago metro area
• Akron, Ohio
• St. Louis, Missouri

To paraphrase 19th-century newspaperman Horace Greeley: “Go Midwest, young man.”

Let’s say you’re buying a pack of frozen White Castle sliders online, and a special offer pops up. 

The option to turn it down is a guilt trip: “No thanks,” it might say, “I hate saving money.” 

Sound like something your bratty brother would hiss? That’s the point. 

These are ‘dark patterns’

They’re designed to get you to load up on more stuff than you might need. A Princeton study found more than 11% of ecommerce sites had at least one of them.

Last year, Congress batted around a bill that would ban some of these strategies, calling them “manipulative.” 

Is dark magic at work? Here are some warning signs

• Peer pressure. 80 people viewing an item? Sometimes, those warnings aren’t based on real data.
• Scarcity. Nothing gets the credit card out faster than a “Low Stock” label.
• Double negatives. Does “Uncheck the box if you prefer not to receive email updates” make any sense? 
• Countdowns. A clock is winding down your special offer. But once it hits zero? A lot of times, the timer just starts up again.

Pucker up, babe. 

Armchair economists have long looked to the lipstick index to gauge where the economy’s going.

When money’s too tight for other extravagances, the thinking goes, women buy lipstick to get a luxury fix.

But the premise smudges faster than cheap lip gloss when you look at what’s happening now.

Mask mandates make MAC’s Ruby Woo moot

A report from McKinsey predicted global beauty revenues will dip 20 to 35% this year. Lip color sales are down 15% on Amazon.

In other words: The lipstick index is chapped.

OK, what else is there? 

The hemline index says women’s skirts get shorter in good times and longer in bad. 

But who’s wearing anything besides sweatpants right now?

Then there’s the men’s underwear index. During economic booms, men indulge in new undies, former Fed chair Alan Greenspan once said. In bad times, they’re content with ratty shorts. 

So does the undie theory hold up? 

The jury’s still out.

We used Jungle Scout to check men’s underwear sales on Amazon — they were up as much as 193% within the past 90 days. Hanes’ parent brand, meanwhile, saw “innerwear” sales dip 27% in Q2.

The Blackstone Group is acquiring a 75% stake in Ancestry.com for $4.7B.

It’s a major move at a tricky moment

Two DNA-testing kingpins, Ancestry and 23andMe, laid off workers this year when consumer demand sagged. They kinda have the D2C mattress problem — a customer might buy one kit, but who needs two?

So we put the puzzle to our Trends community: Why is Blackstone going big on a DNA testing company?

Amanda Black, owner of The Solo Female Traveler Network, was unnerved: Just before hearing the news, she got a kit, used it, and returned it in the mail. “I thought it was weird how many times I was asked if they could keep my info and also told me they were going to be using my results,” she said. “This is interesting and uncomfortable.”

Here’s what others told us

Jon Khaykin from IPOs.fyi says the DNA/health data is a “huge moat” for Ancestry. By licensing it to a biopharma giant, “These companies could use the health information to research diseases as well as find and recruit research subjects.”

Chi Odogwu, co-founder, Odogwu Digital Media, says screening for predisposition to diseases could work like a Minority Report for healthcare. Another opportunity: “Marketing for customized fitness and health plans via subscription newsletters.”

Join the insiders’ conversation on Facebook by subscribing to Trends.

We’re living in a golden age of ice cream innovation.

There are currently more than 82k posts of people inhaling liquid nitrogen ice cream on Instagram. Experimental flavors like charcoal and Thai tea are commonplace. And the frozen dessert market — largely driven by ice cream — is on the up and up.

But modern ice cream likely wouldn’t exist without the innovative efforts of one woman more than 100 years ago.

This Sunday, we’ll explore the life of Agnes B. Marshall, a largely forgotten 19th century entrepreneur who democratized a treat typically reserved for the rich — and who, in many ways, pioneered the ice cream we all know and love today.

Watch your inbox for the scoop.