Posted on 04/26/2022 4:24:28 AM PDT by Kaslin
You've probably heard of the high-flying Big Tech FAANG stocks -- Facebook, Amazon, Apple, Netflix and Google. Among the five of them, their market cap reached $6 trillion last year, which is more than the GDP of all but a small handful of entire countries. Moreover, their net worth is larger than the entire annual output of India, with more than 1 billion people.
These companies got so big and profitable so fast that politicians on the left, right and center started accusing them of monopolistic behavior. "Break them up!" shouted Democratic Sens. Bernie Sanders and Amy Klobuchar. Some Republicans, such as Josh Hawley, endorsed the same strategy.
But has anyone noticed what has happened to the stock values of these once-invincible powerhouses?
Netflix's stock has gotten crushed of late. Just flattened.
Its share price collapsed by 35% in one day. This was one of the most significant single-day sell-offs in the history of stocks. For now, the rout doesn't seem to be waning. Over the past year, Netflix's market cap has tumbled from $267 billion to close to $96 billion.
Sorry if you own this stock. And most pension funds do own Netflix as part of their portfolios, so it wasn't just millionaires who got hurt.
The Netflix brass blames its demise of late on "fierce competition" for subscribers.
Meanwhile, Facebook has suffered even more considerable losses that exceed one-half a trillion dollars. That's not supposed to happen to monopolies that crush the competition. Instead, the hunters have become the hunted. Facebook is confronting serious competition from other social media platforms such as LinkedIn and China's TikTok, which are elbowing out Facebook's dominance.
What are we to make of all this jostling to be king of the mountain in the digital domain?
I carry no water for Big Tech, and I'm as frustrated with the free speech infringements against conservatives as anyone. But cries of "monopoly" are so early 20th century. Just as no one worries about Standard Oil, Microsoft or General Motors taking over their industries, we see the same cutthroat survival tactics in the hypercompetitive tech sector. This kind of competition is great news for the consumer. It lowers prices and makes a mockery of the "monopoly" rants.
Companies such as Google better look over their shoulders. If you slip up, the marauders are coming to steal away your market share. Sometimes, the raiders aren't even American companies. Globalization and free trade have dramatically lowered the prices of nearly all digital products.
That is as it should be in a free-market capitalist world. One day, you are on top of the world and seemingly in an impenetrable fortress, and the next, you lose half your market cap. We don't need trust-buster regulators in Washington, like the leftist Lina Khan of the Federal Trade Commission, policing our businesses. The market is doing that just fine, thank you.
America has gained tech dominance over our rivals, especially China, Japan and Europe, because we have allowed the digital economy to remain mostly tax- and regulation-free. It's the Wild West in Silicon Valley and Austin, Texas, which created the trillions in wealth in the first place. The high-tech industry has added value and wealth at a blistering pace, and how sad is it that when our American ingenuity and inventiveness succeed, the trust-busters want to tear it down? Then, when these tech giants start to surrender their competitive advantage, the fool politicians want to give them billions of dollars of corporate welfare handouts from taxpayers.
The late and great Austrian economist Joseph Schumpeter called the process of inventing new products to challenge the extant corporate power structures in business "creative destruction." The Netflix and Facebook sell-off is a jolting reminder that the market is a better way than government to keep companies honest and on top of their game. It also keeps prices low.
I would really like to know who controls Amazon.
Bezos built this thing from the ground up..so the story goes ...
I love Amazon ..I can get an item quickly..and I can cut cable and watch a channel during their special promotions.
When I needed an abdominal binder I had quite a few to choose from that I could get in a few days. That couldn’t happen locally.
But now bezos could care less about Amazon and is off traipsing the world with his girlfriend.
Who is really responsible for big tech ...
........”cap reached $6 trillion last year, which is more than the GDP of all but a small handful of entire countries. Moreover, their net worth is larger than the entire annual output of India, with more than 1 billion people.”
A lot of words to say “two”.
I like how Amazon makes it very easy for a car-stupid person to order headlight bulbs for their car...
...and get cheap Chinese LED bulbs that don’t even work at all, and would blind everyone else on the road if they did.
For years Amazon did not make any money. For the most part, all they did was sell books. A lot were used books. Then Kindles( I have two). When they started selling virtually everything else is when they really started making money.
Amazon made it so you could purchase almost anything and have it delivered to your house within 5 days. Even if it was a 70” flat screen TV. This destroyed the business model of almost every retailer. Walmart, Best Buy, and many others were forced to play catch up. Many went out of business because they could not adapt fast enough.
It did not matter what the the item you were looking to buy. It could be bought on Amazon safely, without the concern that people had buying items on EBAY. If you did not like it, you could return it too. You could use your credit card. There was no need for a Paypal account like on EBAY. Amazon revolutionized the way people all over North America and many parts of the world can buy and sell items and use the full power of the internet.
except for apple none of these companies actually makes anything. For Amazon i use them for searches and then try to use the actual company websites for buying. Sometimes you can’t and then the return policies sometimes are more difficult but to me it is worth it.
It’s simple: Get woke, go broke. In Netflix case, however, who wants to subsidize or sanction child exploitation? Who wants to take all that capital and subsidize politicians like Obama?
Idiotic business decisions.
And Meta
The Metaverse is a place where you can openly be pedophile or predator. Nothing more. It’s a horrible idea. Now Facebook is getting hammered by the market.
It’s the same reason why the ratings are down for the Mockingbird Media - who wants to subsidize what is clearly propaganda? CNN+? Arrogant to even contemplate it. Pay to be lied to? OK.
You don’t like our ______, make your own platform!
Challenge accepted...
Interesting,
I’m thinking people are tightening their purse strings and cutting the fat out of their budget as inflation builds.
Gas is more important.
Netflix ought to contact Joey and ask Shathispants Biden WTF!
Remember when Marx stated that religion was the opiate if people?
That was before folks started purchasing cheap junk coming out of PRC. Now we see what the true opiate is.
“Amazon made it so you could purchase almost anything and have it delivered to your house within 5 days.”
That’s what Ebay did.
” There was no need for a Paypal account like on EBAY. “
Ebay already removed Paypal links. Guess what my ecommerce seller friends told me? Paypal (even though most people hate it) was the SECONDARY source to get your money back from thieving customers, regardless of Ebay’s pro-customer stance. Most people think Ebay sellers are scum but boy, people are wrong. It’s the other way around.
Want an example of Amazon’s unfair customer principle? I have a friend who sold expensive Italian wine glasses. Most wine experts know the Italian name. Come Christmas time, sales would be through the roof, and after New Year 80% of customers would return them, mostly damaged, WHY? They used them for Christmas and New Year parties DELIBERATELY and returned them after around 1st week of January citing “I didnt like them”.
Unfortunately, there are scum bags across all types of retail exchanges.
Why do you think if you return a small appliance to Walmart or Home Depot that they take it out of the box to confirm that the SKU code on the box matches the one on the actual device.
It happened to me at Home Depot. I bought a Porter Cable air compressor/nail gun package. The manger discounted it because the box had been opened. When I brought it home, the purge valve was busted off the bottom of the tank. So, I returned it the next day. When the lady at the service desk compared the SKU number on the compressor tank to the one on the box they did not match. The one on the tank was two years old. So, someone had bought a new compressor combo, put the old compressor in the new box and returned it to get their money back.
The service manager said it happens all the time. I asked what is the worst you have seen. She then told me the story about a guy returning a AC window unit at the end of the summer. He came in with the box and no receipt. The box was pretty heavy. When she opened it up there were two cinder blocks in the box. The “customer” said: “how did those get in there” and walked out of the store.
That is also why HD and Lowes now has the policy if you put the oil in the engine of a lawn mower, snow blower, Chain saw, etc they will not give you a refund.
Same thing with pumps. Every spring when basements would flood people would buy a pump and then return it.
“That is also why HD and Lowes now has the policy if you put the oil in the engine of a lawn mower, snow blower, Chain saw, etc they will not give you a refund.”
I’m guessing the same applies to portable generators knowing that summer season is coming up.
Yes, once you put gasoline or oil into it, you own it. I you have a problem, contact the manufacturer for warranty service.
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