Earnings season is upon us once again, and tech giants such as Facebook and Google are announcing phenomenal earnings.
At the same time, they’re in the government’s crosshairs for alleged unfair business practices.
Facebook has already been hit with a $5 billion fine over privacy violations. That’s the largest fine in Federal Trade Commission history.
And now the Department of Justice has opened new antitrust investigations into Big Tech companies such as Facebook, Google, Apple and Amazon.
Treasury Secretary Steven Mnuchin even said that e-commerce giant Amazon has “destroyed the retail industry.”
These are some of investors’ favorite companies, and I’m sure many of you reading this own shares in one or more of these stocks. So, I asked experts Jeff Yastine and Michael Carr to share their thoughts on this topic with you.
Jeff and Mike have both written articles on antitrust activity recently. (You can check them out here and here.) So, I was sure they’d have a lot to say.
In this 10-minute video, they discuss:
- Microsoft faced similar antitrust investigations in the late ’90s. Its eventual punishment coincided with the peak of the dot-com bubble. Quote: “Of course, Microsoft is still here. It reinvented itself, and it actually presented a better buying opportunity a couple years after the investigation wound up.”
- Antitrust is a bipartisan issue, so it threatens Big Tech regardless of what happens in the 2020 elections. Quote: “The chances are that these stocks, because of that, are just not going to be able to move the way they once did. And investors will not buy them the way they once did.”
- Going forward, Big Tech players may have a future as dividend companies. Amazon, Facebook and Google are big companies with huge amounts of cash flow. Quote: “Google might be a monopoly, but it’s more like a utility, in my mind. I don’t really know all Google does, but I know my whole life revolves around Google.”
Watch the 10-minute video below to hear Jeff’s and Mike’s thoughts on the latest antitrust news:
We’d like to hear your opinions as well.
Do you think the government should go after Big Tech? Or, as Mike suggests in the video, would you prefer to let the free market sort things out?
You can email your thoughts to SovereignInvestor@banyanhill.com.
Regards,
Jay Goldberg
Assistant Managing Editor, Banyan Hill Publishing