A potential recession, coupled with increasing regulatory frameworks for some of the biggest technologies, exacerbates a difficult 2019 for Silicon…
A potential recession, coupled with increasing regulatory frameworks for some of the biggest technologies, exacerbates a difficult 2019 for Silicon Valley.
Why It Matters: The biggest technology companies have already raked in billions of dollars in profits and benefited from large tax cuts that will not be repeated, so next year will not likely be better for them financially. They have also been persecuted by scandals who have left many people questioning their positive role in society, and if the economy begins to conceal, 201
9 may get worse.
“People are looking for scapegoats in a bad economy. With big technology already on their heels, a downturn would probably give rise to arguments that the biggest internet companies are too big and need to be rushed.”
– Paul Gallant, an analyst with the Cowen Washington Research Group
Big Tech is closing a contested year in Washington and potential regulation continues to haunt it well into 2019.
Some analysts predict an economic slowdown – even if it does not lead to a recession like 2008 – will be enough to change the global attitude of major US companies.
“So it’s really shocking this year is that the only major economy in the world where growth has actually accelerated this year is America. And this is due to tax relief, deregulation, the second stimulus that has been incorporated. And it has Also helped to my results is that from the next year the effects begin to fade. “
” FAANG “layers (Facebook, Amazon, Apple, Netflix and Google) that ran the stock market for record increases have not been immune from this year’s market.
The other side: “I do not see a threatening recession, and even if it is, people will not target these companies if there is a recession,” says Nicholas Economides, professor of economics at NYU Stern School of Business.
Bottom line: Technical companies that have long been darlings of investment portfolios are likely to be in much weaker positions.