In this week’s episode of In Search of Green Marbles, G3 sits down with Mike Edwards, Deputy CIO and Weiss Multi-Strategy Advisers’ resident policy expert to discuss his approach to analyzing Congress and the Biden administration.
To kick things off, Mike advises that it is sometimes easier to start with what not to pay attention to – and that is the drama. Indeed, after the frenetic pace of legislative activity in 2020 and 2021, Mike asserts that 2022 will be more like an episode of Seinfeld. That is to say, a show about nothing. Of course, there will be some caveats to this, but they will probably be minor.
So what is worth paying attention to? Besides China, Mike is going to pay close attention to the relationship between Biden and the Fed, specifically surrounding inflation. He believes that the market is not paying enough attention to the actions that the administration can unilaterally take to offset the effects of inflation. While Mike concedes that these actions may not be effective, they will nevertheless make headlines between now and the midterm elections.
Another question Mike addresses is how the Biden administration is going to handle antitrust battles. In his view, the administration will try to prevent consolidation mostly through intimidation. In terms of there being any real chance that a major tech company could be broken up, Mike believes the answer is no. It will be very hard to change the overall legal framework in place that is currently stacked with very pro-business judges.
Looking forward, big companies in tech, or any other industry for that matter, will potentially have to look more towards organic growth rather than through M&A. Markets will also likely look with skepticism on attempts by major companies – especially Big Tech – to obtain approval to do large deals. As such, it should be no surprise that Big Tech is pivoting to the metaverse. With no antitrust issues in the metaverse, it will be easier for Big Tech to build aggressively on the back of this trend.