Google’s stock has the potential to take a major hit and experience a severe sell-off over the coming months if Trump wins a second term IMO.
Jim Cramer dismissed the lawsuit against Google by the DOJ, and called it a loser case by the government. He said, what is going to happen, search is going to get broken up?
Note to future self: Never take tech advice from Cramer as he’s relatively ignorant about technology.
There used to be about eight different major search engines. Today there is only Google, which dominates 80% of all search.
In a free-market economy for search, you would have today’s Democrat-leaning Google model, which serves up Democrat media to the top of its News search. Still, then you’d have a Republican-leaning search that we’ll call America First search that would serve up Republican media to the top of its News search. In the current state of affairs, that’s impossible with 90% of all advertising spends going to Google because of its ownership of search, YouTube, WordPress, DoubleClick, and other software companies it buys to corner the advertising market. It takes advertising dollars to pay for the servers in a data center to host search and other services. Democrat-leaning tech companies like Google, Facebook, and Twitter dominate advertising dollars. In that case, there’s no competition and no alternative platforms people can go to when Google oversteps its boundaries and bans individuals from its platforms as well as Google Adsense program. These companies restrict the flow of information and advance narratives that support their political donations.
The Justice Department is expected to file a lawsuit Tuesday, alleging that Google has been abusing its online dominance in online search to stifle competition and harm consumers. CNBC’s Jim Cramer joins “Squawk Box” to give his first take.
We disagree with Cramer and think Google stock has the potential for a major sell-off if President Trump beats Joe Biden. A Joe Biden Administration would presumably end any litigation against Google. We can see that in the campaign donations from Google to Biden’s campaign.
Joe Biden is Google’s man. If he doesn’t win, the DOJ will continue to go after Google under a Trump Administration which greatly increases the odds of anti-trust action against the company which could cause its stock to plunge.
Cramer is being much too dismissive of the DOJs actions against Google IMO which may suggest that Cramer believes Biden is pretty much guaranteed to win the 2020 election and end the DOJ action against Google.
To keep its stock going higher, Google should immediately give equal dollars to Republican candidates, allow Republican-leaning news sites equal weighting to Democrat-leaning news sites in its search results, reinstate InfoWars and others it has banned, and make a strong move back to just being a platform that doesn’t have any biases whatsoever. I don’t see Google being able to do this because it has absolute power and absolute power corrupts absolutely.
Our recommendation is to avoid GOOGL stock until we know the outcome of the 2020 Presidential election.