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**JANUARY 24, 2024**

On the Prospect website

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It's Trump's Party, and America's Problem

Republican fealty to their master demagogue is undiminished, as New
Hampshire demonstrated yesterday. BY HAROLD MEYERSON

Big Funeral Exploits Consumers Under Guise of Inflation

Reduced inflation across the economy magnifies the sectors where high
markups persist. BY LUKE GOLDSTEIN

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American Fascism

Author and scholar John Ganz on how Europe's interwar period informs
the present BY RICK PERLSTEIN

Kuttner on TAP

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**** The Stock Market Loves Monopoly
Concentration

That's another case for the revival of antitrust.

The financial press has been filled with reports of how the lion's
share of the stock market run-up in 2023 was concentrated in just seven
companies
,
which have been dubbed the "Magnificent Seven." These seven companies
account for 28 percent of the value of the entire S&P 500, and more than
60 percent of the 2023 increase in the value of the broad market.

Without them, the stock market gain in 2023 was a quite unremarkable 9
percent after inflation.

The Wall Street Journal has been making a big deal of this

for months, and lately The New York Times has gotten on the bandwagon
.

Who are the Magnificent Seven? They are Alphabet (Google), Amazon,
Apple, Meta (Facebook), Microsoft, Nvidia, and Tesla. Five of these will
be familiar as the largest platform monopolies. They had a supernormal
run-up in the stock prices because they have supernormal profits. And
they have supernormal profits because of their monopoly power.

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Ownership of the shares of these companies is also highly concentrated.
Just four investors hauled in $491 billion last year from the stock
run-up. Ownership in stocks as a whole reflects the wealth inequality of
the society, with the richest 1 percent owing 54 percent of all stocks
.
The stock market gains of 2023 made them about $5 trillion richer.

(The other two companies in the Seven are Tesla, a onetime
near-monopoly, whose stock has been plummeting in 2024 along with Elon
Musk's mood swings; and Nvidia, a dominant company in the burgeoning
field of AI.)

Belatedly, the Federal Trade Commission and the Antitrust Division of
the Justice Department have launched several cases against the platform
monopolies. If the government prevails, that will squeeze out some of
the excess profits. That would be good for consumers, for competitors,
and for the deconcentration of extreme wealth.

A soaring stock market is often equated with the strength of the
economy-but not when it's rooted in this kind of monopoly power.
Sometimes, a bull market is an indicator of the economy's ill health.

~ ROBERT KUTTNER

Follow Robert Kuttner on Twitter

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