On Thursday afternoon, news broke of a report from The Times that suggested that the Japanese government had decided to cancel the 2021 Summer Olympics behind closed doors.
The Japanese government has privately concluded that the Tokyo Olympics will have to be cancelled because of the coronavirus, and the focus is now on securing the Games for the city in the next available year, 2032 https://t.co/bsuB9wMt30
— The Times (@thetimes) January 21, 2021
That report has been challenged by the Japanese government itself, but newspapers rarely take a chance on headlines like this without a very solid foundation for their claim.
These negotiations ought to be happening in public, but, of course, the Japanese government is no different than any other.
They aren’t willing to air their dirty laundry where everyday people can see it.
And now they may have cancelled the world’s biggest sporting event without telling anyone, least of all the athletes who have been training their whole lives for this moment.
It’s typical government behavior, but it’s still shady business.
There’s always a market effect
You might be thinking: “that’s interesting, but what’s this got to do with trading?”
More than you might think.
Almost every headline has some impact on the market, and this is no different.
The clearest effect will be on Comcast (CMSCA), the parent company of NBCUniversal, which spent a jaw-dropping $7 billion to keep the Olympics on their network through 2032.
If they lose an Olympic year entirely, that will be a devastating loss for their investment, especially as they struggle to get their Peacock streaming service off the ground.
It’s a minor angle on a bigger international story, but it’s still something investors need to be aware of.
If you’re long on CMSCA, keep this story very much in the front of your mind.