Let's Play Monopoly

Key Takeaways

[Music] in this week's winners and losers we talk about monopoly monopolies the latest sector that Amazon has put in jail the shipping sector Amazon announced it was getting into delivery of goods immediately UPS and FedEx stocks crashed five percent on opening bell or about eight billion dollars market capitalization continuing a pattern of cascading stock prices within hours of Amazon announcing interest in any given sector analysts claim the threat is overblown pointing to UPS and FedEx complex infrastructure and that Amazon accounts for approximately just five percent of total revenue and pointing to all the capex expenses about five billion each for FedEx and UPS in the most recent year last year we correctly predicted that Amazon would get into this business if Beezus tamal said we see overnight delivery as a huge opportunity 150 billion dollars a market cap of DHL FedEx and UPS would begin leaking to Amazon Amazon claimed last year when they started leasing airplanes and buying tractor trailers that they were only supplementing holiday demand well it appears that FedEx and UPS should get ready to be supplemented it doesn't matter what the reality is the perception that Amazon will win is a self-fulfilling prophecy as they will begin choking access to the mother's milk of business Capital prediction FedEx and UPS regardless of the reality will lose 20% of their value in the next six months and Amazon will increase its market cap by about sixty billion dollars as analysts begin to sharpen their pencil and look at a new gangster in town and shipping Amazon another player with billions of hotels on any property you might land on Apple Apple music is now growing faster than Spotify in the US Apple music is gaining subscribers at a rate of five percent per month versus Spotify 2% growth Spotify still has twice as many subscribers but Apple has a built-in advantage as it comes pre-loaded on 1 billion iOS devices I get in my car and Apple music begins automatically playing by the way Apple has literally ruin to YouTube for me i can't turn that up Apple takes a 30% cut of all subscriptions sold through its App Store Spotify decided to avoid the charge by preventing new customers from subscribing to Spotify Premium through the App Store Apple retaliated by blocking the Spotify update when you're building a platform and you unfairly restrain the competition that's direct evidence of Monopoly abuse what is the growth engine of our economy tech tax cuts no it's small business if you look at the front page of any business section however or turn on CNBC you think thousands of businesses were being formed every day and night by shiny grads from Berkeley Stanford and MIT not to mention all the dropouts starting billion-dollar companies but what's the reality startups are in freefall specifically over the last four decades new business formation has been cut in half the number of public companies has also declined dramatically why there's some macro reasons people have more debt coming out of school and because they have to pay to listen to this book so they're less inclined to start a business maybe because of the housing crisis they're less likely to move however we would argue that the real reason here is it's harder to get funding small businesses can't compete with big tech when I'm in VC meetings and I'm in a lot of them budding entrepreneurs have to adopt a basic narrative and that is we don't compete with Amazon Apple Facebook or Google but we make great acquisitions which is effectively an oxymoron so if there's a shot you'll be bought by an enormous company you can raise billions at the same time as not compete with them however every other good idea raises zero it has never been easier to be a billionaire and never been harder to be a millionaire under the category of strange bedfellows this morning Ted Cruz just that Ted Cruz senator from Texas referenced an article that we wrote in Esquire how do we feel about it kind of like kissing our hot cousin a mixture of very conflicted emotions or better yet some of the dreams I've been having about magnum p.i specifically a physical encounter with Tom Selleck initially a bit off-putting but then I find I start to like it and then he screams out I'm Magnum 3.14 which really gets the ball rolling if you know what I mean [Music] you [Music]