Uber (NYSE: UBER) and Lyft (NASDAQ: LYFT) have been having a pretty horrible week.
As if the broader market sell-offs haven’t been enough, on Tuesday, Virginia Senator Mark Warner sent letters to ride hailing and delivery service companies, requesting that they start a coronavirus fund that would allow their workers to take time off to get tested or self-quarantine.
He also suggested paying workers what he calls “average pay” regardless of whether or not they can work normal hours.
While I certainly understand the concern, anytime a lawmaker makes a “suggestion,” it’s really a lawmaker letting these companies know that if they don’t fall in line, they’ll be harassed.
Imagine, for a moment, if a senator walked into a neighborhood taco stand and “suggested” that management set up a fund to protect its workers from potential sickness and downtime.
While an honorable endeavour for a company to voluntarily make such a decision, when the government becomes involved, it becomes borderline harassment.
A lot of these companies are already going to struggle on earnings next quarter. Now they’re being threatened (and as far as I see it, it is absolutely a veiled threat), if they don’t comply with the wishes of a politician who has no experience running billion-dollar companies?
That’s not OK.
Companies that were singled out by the senator include Uber, Lyft, Instacart, Postmates, Grubhub (NYSE: GRUB), and DoorDash.
And if that wasn’t enough, the Massachusetts House just passed new tax increases, which include fees that will likely add $1 to every Uber and Lyft ride.
Lawmakers added that those fees cannot be passed along to consumers. I guess they’re just supposed to dig into their own pockets (or the pockets of shareholders), which, of course, will ultimately flow downstream to their drivers.
I’m not sure why so many politicians have decided to penalize gig economy companies by pressuring them with onerous regulatory scams and burdensome taxes and fees. Aside from the cannabis industry, I would argue that no other industry has to put up with this kind of bullying. Which is unfortunate, as both industries offer a lot of value to consumers, job seekers, and local economies.
And of course, amidst a major market meltdown, this will only add more pressure to many of these stocks.
But There Is a Silver Lining
As much as I appreciate what the gig economy industry offers, it’s hard to get excited about these companies in terms of investment opportunities.
While I wish nothing but success for the companies that have provided much needed disruption when it comes to delivery services and the taxi industry, as an investor, the risk is just too high, especially now that the coronavirus has pushed a lot of quality stocks into oversold territory.
Once this thing peters out though, there will be a lot of opportunity to ride a very profitable rebound.
One opportunity I’m particularly excited about right now is this new technology called “Blue Gas.”
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It’s actually pretty amazing.
It’s a groundbreaking technology that could completely upend the entire transportation industry.
It’s 100% emissions-free.
It doesn’t require any kind of “next-generation” lithium-ion batteries or rare earth metals. And it makes biofuels look about as relevant as a rotary phone.
In one minute, you can fill your tank with this stuff and then literally drive for weeks without having to refuel.
Even with a huge gas guzzler or semi truck, you can get driving ranges exceeding three weeks.
Now I’ll be honest; I’m not some kind of tech wizard.
I don’t fully understand how this technology works, but I do know that my colleague, Jimmy Mengel, has video evidence that this thing is the real deal.
And make no mistake: I’m definitely getting an early piece of this thing.
I’d be a fool not to.
And once you see the video for yourself, you’ll see why I’m so bullish on “Blue Gas.”
To a new way of life and a new generation of wealth…
Jeff Siegel
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Jeff is the founder and managing editor of Green Chip Stocks. For more on Jeff, go to his editor’s page.
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