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Ep. 593: Scott Galloway Interview with Michael Covel on Trend Following Radio

Scott Galloway
Scott Galloway

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Scott Galloway is a professor at New York University Stern School of Business teaching brand strategy and digital marketing. He has started nine firms and his weekly YouTube series has generated millions of views. Scott is also author of “The Four: The Hidden DNA of Amazon, Apple, Facebook and Google.”

Amazon, Apple, Facebook and Google are arguably the most influential entities in the world. These companies have deconstructed who humans are as a species and reassembled who humans are, in the form of for-profit companies. They have scaled up so fast and become so successful by understanding humans most common questions and producing answers instantly. Scott breaks down the specific reasons each of these companies have individually thrived: Google = God, Facebook = Love, Amazon = Consumption, and Apple = Sex.

Mediocre and cheap products have been pushed in years past. However, people have new tools allowing them to practice due diligence and find what product is best for them personally. A better product is the best and only way to brand in today’s marketplace. With customer reviews built into Google and Amazon, they have changed the entire course of how people buy.

These four companies have done a lot of good, but have they become so big that they have become bad for society? In some ways, they are leveraging their power to unhealthy heights. Amazon, Apple, Facebook and Google yield more money and more power than some foreign governments. This has allowed them certain privileges such as tax avoidance and immunity to government oversight. What is another negative? Amazon has literally sucked the oxygen out of other top companies such as Nordstrom, Macy’s, and Sears. Facebook and Google have taken over the digital marketing world. If you are not working with Facebook or Google, then you are marketing with newspapers or magazine — rapidly declining markets. Amazon, Apple, Facebook and Google are not only in zero sum markets, they are creating zero competitors.

What are some great leadership qualities from these top companies? Jeff Bezos, for example, has always kept a long term outlook on consumption rather than short-term. He also has combined fast and free service. Tim Cook has tripled the value of Apple. Apple is the first company in history to have great quality and spend extremely low on production. Facebook has shown tremendous agility in their management. Michael and Scott finish the conversation talking government, and how these companies yield their power in the political arena.

In this episode of Trend Following Radio:

  • Amazon, Google, Apple, and Facebook
  • Eco system of Silicon Valley
  • Zero sum nature of Amazon
  • Jeff Bezos
  • Tim Cook
  • Mark Zuckerberg
  • Political views of Amazon, Google, Apple, and Facebook
  • Strong leadership qualities
  • Monopolies

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Ep. 101: A Love Affair with Apple with Michael Covel on Trend Following Radio

A Love Affair with Apple with Michael Covel on Trend Following Radio
A Love Affair with Apple with Michael Covel on Trend Following Radio

For the past couple of years many of us have been in love with Apple. Their products, their style, and their stock. It was a great story as long as the stock was going straight up. On today’s podcast Michael Covel talks about all things Apple: the worship; the seemingly romantic love of Apple stock; and the drop down to $450 a share from its peak above $702.10 in September (down 35% from its peak). Covel compares the fundamental viewpoint looking at Apple today to the trend following perspective that is purely based on price action. The Wall Street analysts all seem to insist that they can predict the future, but none of them predicted this. So, what does this mean? Is Apple a “broken company”? Apple had a profit of 13 billion dollars, sold 28% more iPhones and 48% more iPads, and the stock still went down. Covel looks at several articles from Wall Street analysts and notes that none of these people were saying what they’re saying now when the stock was at 700 a share. Covel creatively points out the complete drivel coming from these analysts, and notes how nothing has changed on Apple’s end but the price of their stock. So why is this only being pointed out now? And what is Covel’s ultimate point? Follow the price action. Trend followers don’t have to know anything about what’s going on inside the back room of an Apple store. This is a classic example of a trend: ride the train up, ride the train down. Is the stock cheap now? What if it’s at 350 or 250 next month? Do you buy on the dip? If the market is going down, get out or short it. The price knows more than any Wall Street analyst. There is no way on the planet to attach all fundamental views to the movement of the stock price. If the best traders on the planet don’t have these insights, how can the stock jockeys at CNBC and Bloomberg, for example, have them?

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