This refrain landed in our inbox over and over…
“I think Google, Facebook, etc. and all Big Tech should be broken up.”
And a reader says: “What happened to the Sherman Antitrust Act that caused the breakup of Ma Bell? Bring it back. Too few have way too much power.”
Before 1984, AT&T (Ma Bell) operated as a legal monopoly. The company controlled the telephone networks to the extent that consumers even had to rent phones from AT&T.
Under the Sherman Antitrust Act, AT&T broke into seven “Baby Bells” that offered consumers more affordable choices at the local level. AT&T retained its long-distance service.
By last year, most of the “Baby Bells” were back in the AT&T fold, by the way.
Do you think you could use AT&T as a Template to break up Google or Facebook? How would you break up these giant tech companies (bonus: cite the Sherman Antitrust Act)?
Your Rundown for Tuesday, November 19, 2019:
The King of IPOs
“Saudi Aramco does not plan to market its domestic initial public offering (IPO) in the United States,” CNBC reports.
Instead, what’s anticipated to be the world’s largest IPO ever, will debut on the Saudi Tadawul All Share Index, an index that’s underperformed the MSCI Emerging Markets Index this year.
To give you an idea just how big Aramco is…
Using figures from 2018, you would need to add Apple, Google and Exxon Mobil’s profits to equal Aramco’s profits. That’s staggering.
Bloomberg reports: “Saudi Arabia put a valuation on oil giant Aramco of between $1.6 trillion and $1.71 trillion.” That’s below the $2-trillion price target that Crown Prince Mohammed bin Salman was gunning for. (Maybe a poor choice of words?)
“The company is so big, investors and analysts were concerned it could drain liquidity from the Saudi market,” Bloomberg says. “In recent months… local investors — key for a successful deal — were offloading some of their portfolio to buy Aramco shares.”
And that might be under duress.
This is chilling: “The kingdom’s richest families, some of whom had members detained in Riyadh’s Ritz-Carlton hotel during a so-called corruption crackdown in 2017, are expected to make significant contributions to the IPO.” (emphasis added)
Market Rundown for Tues. Nov. 19, 2019
S&P 500 futures are up 7 points to 3,128.
Oil’s down 1.7% to $56.08 for a barrel of West Texas crude.
Gold is down $5.00 per ounce to $1,466.90.
Bitcoin’s down almost 2% to $8,148.76.
Have a good day. We’ll catch up tomorrow.
For the Rundown,