Comment of the Day
20 February 2023
Eoin Treacy
Video commentary for February 20th 2023
A link to today's video commentary is posted in the Subscriber's Area.
Some of the topics covered include: China steadies, copper firm, lithium weak, carbon credits test highs, climate change and geoengineering.
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Apple Ad Rules Send Internet Economy Into Prolonged 'Recession'
This article from Bloomberg may be of interest to subscribers. Here is a section:
A factor that’s gotten less attention, though, is something a bit more arcane, something more specific to the business models that have both enriched some of the world’s biggest tech companies and shaped the way many of us experience the internet. That factor is the iPhone.
In 2021, Apple rolled out what it called App Tracking Transparency. Henceforth, iPhone users had to opt in to certain forms of digital tracking, in particular targeting that involves the sharing of information between different apps.
Social media companies rely heavily on that technique to serve up the targeted ads that are their profit engines. The data they collect can form an ever-more-detailed mosaic of a user and, most importantly, a better sense of what kind of person responds to which types of ads.
Apple presented its anti-tracking policy as a way for people to take control of their information, at a time when lawmakers around the world are championing a similar cause. Ads are intrusive and annoying, and being closely tracked on the internet is creepy. If you are a political dissident or a woman researching abortion in a place where the procedure is illegal, it is terrifying.
At the time, however, Facebook’s parent company Meta saw the change as a serious threat. Social media executives feared that lots of iPhone users would opt out of this kind of app tracking when given the option. Almost two years on, they seem to have been right. Meta estimated that the change cost it $10 billion in 2022, or 9% of its total revenue.
Eric Michael Seufert, an analyst at Mobile Dev Memo, went so far as to call it “the App Tracking Transparency recession.” Seufert argued that the tech companies having the hardest time right now are those most directly affected by Apple’s policy. As he points out, revenue at YouTube, Google's video arm that relies heavily on third-party ad tracking, has lagged the company's search revenue, which is far less reliant on this type of tracking.
Eoin Treacy's view
Perhaps a more accurate way of thinking about the repercussions of Apple’s walled garden approach, to information on its phones, is it is a bear market on click bait. The ads we are served are chosen based on assumptions the seller makes about our proclivities. That’s a valuable asset and now Apple holds that information for itself.
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Email of the day on charting lithium
I hope you are well. Could you replace your LITHIUM CHART with the enclosed below. I am sorry, but yours is useless. Thanks, and regards,
Eoin Treacy's view
Thank you for this email which exemplifies why I am considering turning this service into an asset management business. Your financial advisor sent you a chart of the Ganfeng Lithium stock futures product which is listed in Hong Kong.
Lithium is not exchange traded. We rely on free on board (fob) prices to get an idea of where the spot market is trading. Meanwhile many miners agree to long-term pricing contracts. That makes it a much more involved process to figure out what the average price received is.
What we can certainly say is spot prices are contracting in response to greater supply and slower global economic activity. That’s not great news for lithium miners in the near term.
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George Soros on Climate Change, China, Elections
This video of George Soros’s speech at the Munich security conference over the weekend may be of interest.
Eoin Treacy's view
The talk was split into two parts. The first was devoted to talking about the risks climate change represents and what a potential solution might look like. The second part criticised world leaders in turn.
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Eoin's personal portfolio: commodity long initiated and stock option long initiated February 14th 2023
One of the questions subscribers ask most often is how to find details of my open trades. To make it easier I will simply repost the latest summary on a daily basis until there is a change.
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