{"id":115659,"date":"2017-10-30T10:37:36","date_gmt":"2017-10-30T14:37:36","guid":{"rendered":"http:\/\/countingpips.com\/?p=115659"},"modified":"2018-06-01T15:53:35","modified_gmt":"2018-06-01T15:53:35","slug":"millennials-give-new-meaning-to-breaker-of-chains","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2017\/10\/millennials-give-new-meaning-to-breaker-of-chains\/","title":{"rendered":"Millennials Give New Meaning to \u201cBreaker of Chains\u201d"},"content":{"rendered":"
October 30, 2017<\/div>
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By WallStreetDaily.com<\/u><\/a> \"Millennials<\/p>\n

\"LouisForgive me. But I\u2019m going to use a dirty word today\u2026<\/p>\n

Millennials.<\/p>\n

Whether we like it or not, millennials continue to help shape the economy.<\/p>\n

If you\u2019re in denial of the power of millennials, consider this\u2026<\/p>\n

Millennials value flexibility and have commitment issues.<\/p>

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So what happens to the car industry and housing market in a few years?<\/p>\n

Millennials reject any notion of status.<\/p>\n

So what happens to niche industries like Tiffany and Coach?<\/p>\n

Millennials despise chain restaurants \u2014 always preferring a local tavern to Buffalo Wild Wings.<\/p>\n

So what happens to public restaurant stocks?<\/p>\n

Millennials oftentimes don\u2019t even know what cable television is \u2014 let alone subscribe to it.<\/p>\n

So what happens to Comcast and Time Warner?<\/p>\n

Today, we\u2019ll answer all of these questions and more.<\/p>\n

Better Late Than Never<\/h2>\n

\"JonathanMillennials (I am one) are often accused of eschewing homeownership to live cheaply with their parents.<\/p>\n

We\u2019re also said to favor ride-sharing services over owning a car.<\/p>\n

To be sure, millennials as a whole have taken longer to leave the nest than previous generations.<\/p>\n

And we love the ease of Uber and Lyft.<\/p>\n

But millennials don\u2019t forsake home and car ownership \u2014 we\u2019ve just delayed the purchases.<\/p>\n

Indeed, the millennial generation actually made up the largest group of homebuyers (34%) for the fourth year straight, according to NAR\u2019s 2017 Home Buyer and Seller Generational Trends Report.<\/p>\n

There hasn\u2019t been a major shift in the types of homes millennials are buying compared with previous generations.<\/p>\n

But thanks to the internet, first-time home buyers are empowered to cut deals, with more information available than ever before.<\/p>\n

Millennials aren\u2019t just fueling home sales, either\u2026<\/p>\n

A recent study by J.D. Power\u2019s Power Information Network showed that the share of millennials in the new car market soared to 28% in 2015.<\/p>\n

That\u2019s more than twice the millennial market share in 2010 \u2014 and now makes the generation the fastest-growing auto market segment.<\/p>\n

How are millennials shaping the car industry?<\/p>\n

Low gas prices have made gas-guzzling trucks and SUVs more attractive to the market.<\/p>\n

But generally speaking, millennials want affordable, fuel-efficient vehicles that have the least negative impact on the environment.<\/p>\n

And it\u2019s a market that electric vehicle makers are happy to address.<\/p>\n

The fact is millennials still want homes that they own for their families and vehicles in which to drive them around.<\/p>\n

Make them cheap, efficient and good for the environment \u2014 and millennials will buy them.<\/p>\n

Trailblazing the Cord-Cutting Revolution<\/h2>\n

\"MartinMillennials start their adult life paying for something that\u2019s grossly expensive, the cost of which has soared since their parents\u2019 day.<\/p>\n

Of course, I\u2019m talking about college.<\/p>\n

So it\u2019s not surprising that they\u2019re rejecting other things in their lives for which prices are also on the rise: cable TV.<\/p>\n

Cable prices have jumped 5.8% annually in price for the past 20 years. While inflation has risen just 2.3%.<\/p>\n

And while colleges have achieved such inflated prices by adding futile administrators and reducing productivity\u2026 cable prices have skyrocketed by adding futile channels<\/em>.<\/p>\n

The average number of channels in a cable package used to be 44. It\u2019s now up to 181!<\/p>\n

Sure, millennials channel surf like anyone else. But even the most avid surfer can\u2019t watch 181 channels at once, so the waste percentage has soared.<\/p>\n

Of course, technology has also changed the game completely.<\/p>\n

Many people \u2014 including nonmillennials \u2014 consume TV shows and movies over their computers or other streaming devices. Content can be easily re-routed to the big screen without the need of cable or an antenna.<\/p>\n

Millennials are switching to streaming services like Netflix, Amazon, Prime and Hulu because they\u2019re cheaper and can be more targeted to the user\u2019s viewing habits.<\/p>\n

That means millennial consumers can watch what they want, when they want.<\/p>\n

Now cable companies are trying to compete with streaming providers by offering \u201cskinny\u201d packages. These come with a limited number of channels.<\/p>\n

The problem is their relationships with the big content providers don\u2019t allow them to do this easily. So these packages get bogged down by rubbish channels, which can jack costs back up.<\/p>\n

As in many areas, millennials are blazing the trail here for the rest of us. Ultimately, only the most static couch potatoes \u2014 who still need their 100 hours of TV a week \u2014 will continue to find traditional cable cost-effective.<\/p>\n

Breaker of Chains<\/h2>\n

\"LouisIf you\u2019re tired of hearing about millennials, get over it!<\/p>\n

They now outnumber baby boomers, which we\u2019ve talked about incessantly for years as a key economic force.<\/p>\n

In other words, we can\u2019t afford<\/em> to ignore them. How they spend (or don\u2019t spend) their money directly impacts the economy and the fortunes of individual businesses.<\/p>\n

That said, businesses shouldn\u2019t exclusively cater to them. Case in point: Applebee\u2019s.<\/p>\n

The casual dining chain is shuttering over 130 locations after a failed attempt to rebrand itself as a modern bar and grill.<\/p>\n

In the words of executive John Cywinski, the chain aimed to attract \u201ca more youthful and affluent demographic with a more independent or even sophisticated dining mindset, including a clear pendulum swing toward millennials.\u201d<\/p>\n

And it failed. Millennials simply prefer highbrow local options over national chains.<\/p>\n

Making matters worse, the company\u2019s menu and atmosphere changes ended up disenfranchising long-term loyal customers, too. So not only did Applebee\u2019s fail to attract new customers, but it repelled core customers as well.<\/p>\n

Rest assured, Applebee\u2019s isn\u2019t the only chain suffering.<\/p>\n

\u201cYou see very weak results from people like Ruby Tuesday\u2019s, Friday\u2019s and Chili\u2019s as well,\u201d says Joe Pawlak of food service research firm Technomic.<\/p>\n

To top it off, as I mentioned above, millennials\u2019 finicky tastes and tendencies are also impacting vanity stocks.<\/p>\n

As The Economist <\/em>noted, millennials \u201cincreasingly shun the taint of conflict and exploitation.\u201d Not to mention their No. 1 source of financial stress is debt. And they\u2019re delaying marriage longer than any other generation.<\/p>\n

Add the three together, and diamond purchases aren\u2019t anywhere on their radar. And that\u2019s bad news for former highflying vanity stocks like Tiffany.<\/p>\n

Ahead of the tape,<\/p>\n

Louis Basenese
\nChief Investment Strategist, Wall Street Daily<\/em><\/p>\n

The post Millennials Give New Meaning to \u201cBreaker of Chains\u201d<\/a> appeared first on Wall Street Daily<\/a>.<\/p>\n

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 <\/p>\n","protected":false},"excerpt":{"rendered":"

By WallStreetDaily.com Forgive me. But I\u2019m going to use a dirty word today\u2026 Millennials. Whether we like it or not, millennials continue to help shape the economy. If you\u2019re in denial of the power of millennials, consider this\u2026 Millennials value flexibility and have commitment issues. So what happens to the car industry and housing market […]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-115659","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/115659","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=115659"}],"version-history":[{"count":2,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/115659\/revisions"}],"predecessor-version":[{"id":115676,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/115659\/revisions\/115676"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=115659"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=115659"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=115659"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}