Fortunately For Google (And Tech Investors), People Only Watch 60 Minutes For The Porn Stars These Days

Is Stormy Daniels on too?
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Hindsight is always 20/20, but when it comes to the tech heavyweights that have shouldered a disproportionate share of the burden along the way to sustaining the U.S. equities rally, you didn't have to be Nostradamus to predict that regulatory concerns would eventually come calling.

You can throw Tesla in there as well when it comes to companies that, by virtue of their ambitions vis-à-vis being at the forefront of technological innovation and cross-industry disruption, were bound to come under intense regulatory scrutiny.

To be sure, these are all idiosyncratic stories to a certain extent. Amazon has to deal with Trump tilting at the WaPo windmill. Facebook, and to a lesser degree Twitter, are laboring to get out from under the shadow of election interference. And Tesla is at pains to explain why Autopilot isn't dangerous (well that, and why they're not going to need to raise more capital).

But the tie that binds is mounting regulatory worries. Here's how I described this situation in late March when the specter of government oversight sent tech reeling:

And see this gets me back to the point made here at the outset. It was (and is) ridiculous to assume that we’re going to simply transition seamlessly to a world where Jeff Bezos serves your healthcare needs, provides you with retail banking services, gets you a mortgage, sells you drugs covered by the health insurance he also sold you, and delivers those drugs to your home that he owns the mortgage on via a drone that was activated by his female alter ego “who” now giggles at you for no reason.

In the same vein, it was always absurd to think that Facebook and Twitter were going to continue to operate unfettered as the preferred medium of (un)civil discourse once it became abundantly clear that those platforms were being used (in some cases by bots operating at the apparent behest of foreign intelligence services) to manipulate the public.

Along the same lines (because I needed a way to say “in the same vein” again, only using different words to avoid poor form), it was never likely that all of the sudden, cars were going to start driving themselves overnight without accidentally killing a few people and thus effectively forcing the government to step in.

Everyone wants to invest in the "future", but as Howard Marks put it last summer, "that raises the question of whether investors in technology can really see the future."

Spoiler alert: they can't.

And while it's unrealistic to expect investors to have a crystal ball (although Elon Musk is, by his own sarcastic admission, a time traveler), it probably wouldn't have been too much to ask for tech's cheerleaders to consider the possibility that some of these names were going to run up against government oversight.

Well guess what? Now Google is in the crosshairs, thanks to an upcoming 60 Minutes special. To wit, from CBS:

THE POWER OF GOOGLE – Steve Kroft reports on the power of Google, its critics who say the company has stifled competition, and an antitrust enforcer who is taking action. Maria Gavrilovic is the producer.

Uh-oh, SpaghettiOs!

Of course if you look at the timestamp on that CBS announcement, it looks like it was actually posted on Thursday, but all I know is that as soon as the headlines crossed on Bloomberg, the stock sank in the premarket.

Retail investors on Twitter were super confused:

Nope, it's not a "volcano", it's Bloomberg running this:

  • GOOGLE TO BE FEATURED ON `60 MINUTES´ ON SUNDAY

Obviously, this could end up being immaterial for the shares, but if nothing else it should serve to at least give tech investors pause when it comes to their steadfast contention that regulatory concerns are overblown.

As Doug Schwartz, a partner at CGCN Group, former Chief of Staff to the Senate Republican Conference, working on legislative and political strategy, and former senior advisor to Senator John Thune of South Dakota, told Goldman in an interview last month, "tech seems to be politically 'homeless' right now [in Washington] —facing tough questions from critics on both sides of the aisle."

Right. And remember, this is the most crowded trade on the planet and has been for four consecutive months, according to BofAML's Global Fund Manager Survey:

LongBUYITRobotsBiglyBigLeagueCrazyFutureNoPriceIsTooHighGrabALifeVest

(BofAML) 

Fortunately for tech investors, people only watch 60 Minutes when there are porn stars involved.

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