Big Tech is so yesterday. Prices peaked last year, but there are limited reasons to expect they will ever become so dominant again. They are too big, under the regulatory cosh, and increasingly under competitive pressure. They are heading the same way as the dinosaurs.
Markets love drama… from the next corupto-coin exchange to collapse, rising interest rate threats, and riots in China in the face of a Covid meltdown. But drama and reality seldom coincide – events are more prosaic!
Big Tech “growth” stocks suffered a price-check this week as economic reality bit, but they face much more pressure than just short-term cost and sales problems. Long-Term, new businesses and opportunities are evolving to eat their lunch, and leave them behind.
Would a Tesla survive a Kamikaze Pigeon attack? Tesla remains the tech stock that’s defying the ongoing valuations reality. Why? Because Musk still controls the narrative – and that may be about to change.
Netflix just experienced its’ judder moment – and it is shaking markets. Overnight the streamer became a completely different investment proposition, even though we’ve been warning it was inevitable. There are lessons to be learnt across the equity market.
Disney has just posted some great results on subscription growth, begging questions what it means for Netflix. Will the sector’s founder survive the current attritional Streaming Wars? And what’s it really worth?
Meta’s collapse on the back of competition, regulation, and maturity (?) might just be the moment the whole New New Thang Bubble popped.
A bounce back rally is underway – but its reactive, based on the hopes of “buy-the-dippers”, and the fundamentals haven’t changed. Many weakening Tech stocks are seeing their foundations exposed as built on sand.
Occasionally the Morning Porridge strikes a lucky insight on markets – this morning here are some thoughts on how 2022 markets and events may or may not develop. If they occur I shall hail myself an investment genius. If not, can we quietly forget them?
Inflation is the market’s theme today. Markets expect it, but are they prepared? Inflation doesn’t necessarily spell disaster, but it will force change in the way we think about markets – and Tech will likely be the sector that feels it most!
