Wednesday, September 11, 2019

Wondering How to Invest Your Money? Industry Trends is a Start!

The Gum Wall at Pike Place Market in Seattle started in the 90s.  Who would have predicted such an unusual trend?  In the same way, it can be hard to spot emerging trends in the market.

Do you know if you bought one Bitcoin for 6 cents in 2010, it'd now be worth over $10,000?  Such a statistic makes investing alluring.  

Knowing what to buy and what to avoid, however, is like navigating through a dense fog.  So many pitfalls--for example, a share in Bank of Ireland sold for $139 ten years ago and currently sells for less than $5.

Murkey.  You're probably thinking: I don't want to put my hard-earned money into something so volatile!  

Although I, too, am deterred by the unpredictability of the market, I know educating yourself with all publicly available information is one component of making a good investment.

Identifying industry trends is a significant part of this education.  Here are a few thoughts about what's going on in various industries.

Toppling the Social Media Monoliths?  


Social media is fundamental to our social lives and how we do business.  It's here to stay.

The integral players, however--FaceBook, Twitter and Google--aren't coming across so hot these days. 

Google has been disingenuous at best, and perjurious at worst.  Although they claims to be an unbiased platform, last month former Google employee Zachary Vorheis disclosed documents  showing the company manipulated its algorithm to tamper with the 2016 presidential election.  

Vorheis' documents included 950 "blacklisted" sites Google submerges in search results.  This is exceptionally disconcerting as the CEO, Sundar Pichai, explicitly denied the existence of any blacklist to Congress in December 2018.  

YouTube, owned by Google, faces lawsuits from two companies accusing them of operating as a partisan publisher, and not the unbiased platform they claim to be.

Facebook and Twitter face problems of a similar ilk.  Facebook continues to balk in the backlash from the Cambridge Analytica Scandalwhere they sold tons of personal data to the British polling company.  And Trump drafted an executive order that would take federal action against all these social media giants.

All this strife mars the public image of these companies (consider the #deleteFacebook campaign) and may result in legal measures that preclude them from monopolizing the internet in the future.  

I sense these monoliths will decline, and alternatives will emerge as strong contenderssearch engines like DuckDuckGo, and providers of encrypted email such as ProtonMail (no Google execs scouring our email!). 


Brick and Mortar Retail


Once the go-to on a Saturday afternoon, sadly, malls are shuttering across the US.  The internet has usurped the retail market, and Amazon is devouring the lion's share of these sales (47% in 2019).  

Stores like Nordstrom and Tiffany seem to have staying power, as their brands are classy, elegant and professional.  However, Nordstrom's stock price has fallen steadily in the past five years and now sells for less than half of what it did five years ago.    

I wouldn't even consider investing in Macy's.  Their brand is too casual and cheapens their image, which bodes ill in a declining industry.  And Penny's has been teetering frighteningly close to bankruptcy.  

Really, it's hard to see anything in retail having a lot of staying power with Amazon to contend with!  Speaking of which....


Streaming

Netflix is a streaming service to be reckoned with.  Not only is it entrenched in Hollywood, recently dropping 60 million on the Oscar Campaign for Roma, Netflix also invests in quality content overseas.

However, it's showing signs of cracking.  Netflix lost 126K subscribers in July when it increased subscription prices.  Stock prices fell at the same time.  
  
But more so, serious competition is on the horizon: Disney+.  Check out some of the movie trailers streaming on their November 12th launch: Noelle, Lady and the Tramp, and Mandalorian.  

Not only will Disney+ include high-budget movies with red-hot casts (the likes of Anna Kendrick, Shirley MacLaine, Giancarlo Esposito, Justin Theroux, Janelle Monáe) and original series like Encore, but Disney+ also promises: "more than 7,500 episodes and 500 films" in their library! I wonder if Old Yeller will be one of them.  

Plus, you also have the option to bundle Disney+ with Hulu and ESPN+! Personally, I'd love to drop Netflix in lieu of Disney+.  I'm just hoping that it will be available in Hong Kong!   

One thing we can conclude from the high-budget movies in Disney+'s launch is that cinema is on a continual decline.  Why go to out the theater if you can watch all of this awesomeness on your own couch?  

Of course you can't talk streaming without mentioning Amazon, but that's a conundrum I'll save for another day.
  

Keep Scouring the World Wide Web


Identifying trends is like predicting the Oscar Winner for Best Picture: it's hard to be accurate if you haven't seen all the movies nominated!

That is to say, my off-the-head reflections need to be corroborated with as much publicly available information I can find--including  looking at companies' financial statements, talking with friends, reading articles from a variety of sources, and scouring Twitter.

And what are your thoughts?  Have you spotted trends in the market where you'd like to invest your money?  

4 comments

  1. Oh you just THINK Google execs aren't watching your account, but I'll bet you're on their list now :P I'm still "iffy" about bitcoin because it's so hackable, but I guess pretty much anything is these days. Yes, I wish I'd bought a $0.06 bitcoin when they first came out (or maybe 100 of them). I did buy Ford stock when it dropped below $1 and sold after a couple of years. I just wish I'd had more to invest in that one. Thanks for the heads-up. Disney+ and Amazon are for sure great investments (though at over $1800/share now, it's a tad pricey for most).

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    1. Ha ha, good point, Ruth. Another reason why I should port this blog over to Wordpress. Google could shut this down in a heartbeat.
      The Ford stock sounds like a good investment.
      I just purchased some Disney stock. May sell some of it at Christmas. Crossing my fingers that Disney+ is a hit!

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  2. I forgot to mention that bubble gum wall. Kinda gross but kinda neat, too. I'm sure the germs die after a few hours but still..... It's very colorful, though.

    Ruth
    https://voguefauxreal.com/2019/09/06

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    1. Yeah, it's cool looking for sure. Really stretches on for a while, too--almost the entire alley.

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