| PROSPERITY PUB MARKET TALK
Funflation Finally FizzlingAfter Covid lockdowns ended, many people were eager to make up for lost time by spending on live entertainment and experiences.
The surge in demand for concerts and events was so intense that it led to a phenomenon called "funflation," where prices for live events skyrocketed.
But now, it seems the trend might be coming to an end.
For the past two years, fans have splurged — paying hundreds or even thousands of dollars — on tickets for major tours like Taylor Swift’s Eras Tour and Beyoncé’s Renaissance Tour.
But recent signs suggest that even the most dedicated partiers are starting to feel the pinch.
It’s no surprise that the cost of living has increased across the board. Energy, food, insurance, and car prices have all seen significant post-pandemic inflation. Consumers are finding it harder to justify spending large amounts on entertainment when they're already stretched thin paying for day-to-day needs.
This strain is becoming evident as some artists are canceling tours due to low ticket sale.
For example, Jennifer Lopez recently canceled her "This Is Me... Live" tour, and the Black Keys opted for smaller venues instead of their planned arena tour. This shift indicates that the funflation economy may be losing steam and companies like TicketMaster (LYV), who rely on revenue from entertainment seekers could be in trouble.
When asked, our own Nate Tucci noted, “The regular Joe is tapped out for sure.” While he doesn't have a specific prediction for Live Nation (LYV), his comment highlights the financial pressure many consumers are facing.
Meanwhile, our friend Jeffry Turnmire added, “Ticketmaster is basically a monopoly and has lots of bad practices. Neither company has that feel that they have 'fans' in mind. I think they have money in mind.”
As far as stock performance, he points out that LYV has been trapped around a significant support/resistance level around the 87 - 89 area. You can see Jeffry’s chart here, where the orange bar going across the whole chart outlines the support/resistance level and the gold “cloud” that seems to follow the stock price is Jeffry’s Roadmap Line.
He goes on to tell us that while the stock is short-term bearish due to being below his proprietary Roadmap Line, the stock does look bullish in the bigger/longer term picture.
The cancellation of concerts and tours that used to sell out in minutes is a clear sign that consumers are stretched far beyond their limits. With inflation hitting all corners of their budgets, even credit isn't enough to keep up with the high costs of live entertainment.
As we move forward, it will be crucial to watch how these trends unfold and if they spread to other “wants” like streaming services, cable TV and others.
— The Prosperity Pub Team | | | | |
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