Politicians may come together against Big Tech, says expert

Tony I'll just start with you what should we expect next week out of these hearings you know Mark Cuban I think his has rightly described a lot of the issues with trying to regulate these companies so what responses might we see as this gains momentum yeah I think you're likely to see bipartisan frustration from lawmakers next week there are a few things that unite Democrats and Republicans around here but a an opposition a concern with big tech is certainly one of them and so at the antitrust hearing held by House lawmakers they've opened an investigation into companies like Amazon Apple Facebook and Google and they'll look into whether these companies are using their power in such a way that harms rivals and harms consumers and then with Libra with Facebook we'll see a series of hearings exploring the way the company is rolling out its cryptocurrency and that's coming on the heels of comments from President Trump just last night raising alarms with the cryptocurrency suggesting that perhaps it needs banking regulation and again there you know House Democrats are saying that there should be a moratorium here and inna I was struck by the fact that you have Fed chair Jay Powell on the hill this week in what I thought would be a hot discussion about it rate cuts and how you know worth while those might be and there was a little bit of that but frankly everyone wanted to talk about Libra with the Fed chair and rightly so I mean this is something that could undermine the authority of the Federal Reserve and I thought Cubans points about it being more of an issue overseas we're probably right yeah I mean I think in terms of action you know if the u.s. sees it as a threat to the dollar I think you know Europe sees it as you know again the big US tech companies taking on even more of their economy so I definitely think there's gonna be a lot of interest in what Facebook is doing even though Facebook has said this is a coalition eventually they're gonna you know share some of the management responsibilities with other partners are you surprised 'inna it how much blowback there has been to this Libra coin if you want to call it that I mean it does seem to be a way for everybody to stand up and say no no Facebook now you've gone too far yeah I mean I think that that's exactly it I think you know the whether to apply existing regulations or new regulations to tack has been a big question but I think everyone that has any criticisms is like wait a second you know we really want Facebook to have even more power and controlling a currency on top of where we're at so I think it is a good launching point for the discussion but obviously the concerns around Facebook in particular go deeper than just libre and what it might do in the future sure Doug yesterday we spoke and I'm sure you've heard this argument a million times about whether big tech companies today are gonna go the way of Microsoft in the sense that they kind of have a lost decade in terms of performance while they have all of these these antitrust issues sorted out do you guys share any of those concerns or are you still broadly bullish on the sector I'd say we're still broadly bullish on the big four tech names the way that we see it is over the next year plus I think there's a lot of headline risk there's still the FTC and DOJ investigations the presidential campaign none of these companies have very much in terms of friends on either side of the aisle and you also have the taxation in Europe issue so I think there is a chance over the next year plus we see a lot more in terms of headlines that hurt these companies but in terms of the long term there's still great companies that we don't see any of this regulation challenging how consumers use them and even in terms of the headline risk we have just ridden this wall of worry all the way up I mean sometimes when they're having a bad quarter like they were in the fourth quarter you can say okay well because of this bad headline they're having a bad day Facebook has certainly had some of those but they frankly have completely shaken it all off I mean we're not talking about these stocks trading down big-time on on these headlines and all they seem to be completely ignoring them almost yeah less than a month ago we had this FTC and DOJ news and the stocks we're hit on that day but we've gained all that back plus more and I think part of that is a symptom of the market if people want to be involved with winners and there's an assumption that big tech will continue to be winners in a good economy but I think it's fair to say that investors are not that concerned about the potential for regulation right now you know what kind of regulation do you think would get to the fundamental you know what could terrify investors which would be anything that suggests it's gonna hurt their growth and their you know their their ability to grow profits from here on out I think there's two types of regulations leaving the Libra question aside maybe three if you count that I think you know one area is privacy legislation there had been some thought earlier in the year and there may still be a chance of federal privacy legislation in particular because there's a California law coming on haven't seen as much progress I think perhaps lawmakers waiting to see if California's law gets watered down ahead of going into effect in 2020 so privacy legislation what that might do is make it less profitable to be Facebook or Google serving up these ads and then the other is antitrust although you know investors could look at that either way I mean they might see antitrust you know talk a break up as you know an opportunity to unlock value actually investors don't always mind breaking things up but I you know I do think there are concerns about regulation but I think again as Tony pointed out that would imply Democrats and Republicans working together on anything which doesn't happen that often in the city you

Maurice Vega

3 Responses

  1. They want to control the narrative and what people read. they have already done it on youtube with the " suggestions" of corporate only news channels away from independent journalist. President attempt LIBRA at the command of the big banks because it would hurt their profits

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