Operating at the Intersection of Technology and the Capital Markets
Month: January 2022
The Federal Reserve will pursue some combination of modest interest rate hikes and potentially shrinking of its balance sheet / Quantitative Tightening in the coming weeks and months. The Fed's "Too Little, Too Late" monetary policy will do little to curb inflation. However, the Fed's modest tightening will likely continue to drive Equities lower - … Continue reading The Baby Will Get Thrown Out With The Bath Water
Technology company earnings season is in high gear. It is a heck of a time to be a Technology fund PM or Analyst. Despite the NASDAQ Composite being down 13% YTD, the group has another 40% downside or more in our view. Many of the high-multiple of revenue (no earnings) stocks have 80-90% downside as … Continue reading Tech Earnings Season Is Here
Microsoft's (MSFT) deal for Activision (ATVI), will prove to be one in a string of such deals over the next few years whereby video game platform companies (Microsoft/Xbox, Google/Stadia, Amazon/Twitch), acquire video game content companies. These deals are similar to the wave of consolidation that took place in the 1980's and 1990's when distribution companies … Continue reading More Video Game Content Deals to Come
Our view is that the pace of Technology M&A will slow dramatically in 2022 as bond yields rise. As we wrote recently, the forthcoming Fed interest rate hikes will not be sufficient to curb inflation, but these modest, incremental increases in the Fed Funds Rate over the course of 2022 and 2023 will lead to … Continue reading M&A In 2022: We Have A Different Take
Corporate customers ought to think about diversifying beyond AWS, Azure and Google Cloud for cloud storage and embedded capabilities such as AI/ML/NLP and more. Sure, there is Oracle, Alibaba and others. Yet it would seem now may be the time for Industry-focused players to offer cloud services alternatives. Tickers mentioned: AMZN, BABA, FIS, GOOG, MSFT, … Continue reading AWS, Azure & Google Cloud Alternatives
We have yet to reach "peak inflation" despite a heavily-massaged CPI Too much debt outstanding to sufficiently raise the Fed Funds Rate to curb inflation. The Effective Fed Funds Rate peaked at 19.1% in June 1981 to combat inflation which peaked in April 1980 as measured by 14.6% year-over-year CPI growth. Total Public Debt was … Continue reading Peak Inflation Not In Sight
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