Can a cyclical switch catalyze a structural shift?
With consumer behaviors rapidly evolving in a COVID-19 world, TV advertising is under severe pressure from falling audiences, lack of sports and an increasing number of ad-free, direct-to-consumer options for video services. As we saw in the wake of the 2008/2009 recession, we may again be on the edge of witnessing the acceleration of structural shifts, underlying the inherent cyclicality of the advertising industry.
When counterfactuals are hidden and histories alternative
As Australia sets to emerge from this once-in-a-century pandemic, some of us do wonder was it all worth it? If COVID-19 was not as bad as the forecasters led us to believe, did we need to impair the economy the way we did?
All You Need to Know
At the weekend Warren Buffett led the annual shareholder meeting for Berkshire Hathaway, the company that he has led for more than half a century. This year, however, the coronavirus pandemic necessitated major changes to the program. Here are the key excerpts from his address.
Reporting Season Roundup
Every quarter when reporting season rolls around, there are always new insights gleaned that can provide a broader read-through on emerging trends. Perhaps with the uncertainty from the COVID-19 (C19) pandemic, this reporting season will be watched for clues more eagerly than usual. We will provide some interesting tidbits which give some colour around how companies are faring in today’s uncertain environment.
Will e-sports have its COVID-19 moment too?
Stay-at-home orders have been a boon for video streaming and video gaming. With traditional sports suspended and people stuck indoors, e-sports is having its turn in the limelight. Will e-sports finally become the opportunity it was once touted to be, or will it once again be relegated to the sidelines post the coronavirus?
The Problems with Testing
While “testing, testing, testing” has become the mantra for public health experts looking to contain the spread of coronavirus, and politicians and business leaders wanting to get workers back to work, it is far from a panacea for the pandemic and its adverse economic consequences.
Are equities disconnected from the real economy?
In this continually-evolving crisis, we update our investors again with a brief summary of how we are assessing the risks for our global equity portfolios.
The Frankenstein Fed Is Not Saving Everyone
Despite unprecedented actions by the Fed in the wake of COVID-19, high yield borrowers do not have a Fed liquidity back stop. Fundamental price discovery should continue for these businesses with respect to their balance sheet solvency (i.e. capital structure) and cash flow solvency (operating structure / business model). Over the long term, no amount of liquidity will save a broken business model, while a broken balance sheet will destroy a lot of capital and replace existing shareholders.
Ad Dollars Follow Eyeballs (Most of the Time)
In advertising it is often said that ad dollars follow eyeballs. Despite the fact the people are consuming more digital media due to the current COVID-19 crisis we are seeing evidence of the digital ad market taking a hit. The COVID-19 pandemic has shown a remarkable ability to disrupt even the most resilient of businesses.
Insights from the MS TMT Conference
In this article we cover the main themes and trends raised by a range of companies at the annual Morgan Stanley Technology, Media and Telecommunications conference in San Francisco last week. The theme which received most attention is understandably: the impact of the coronavirus on firms.
