Starion Bank issued the following announcement on May 27.

In this Thoughts on the Market series, Michael Zezas offers perspective on how U.S. public policy affects equity and fixed income markets, including trade tensions, infrastructure and government policy. Listen to this week’s update.

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Current Episode Transcript

Welcome to the Thoughts on the Market. I'm Michael Zezas, Head of Public Policy Research and Municipal Strategy for Morgan Stanley. Along with my colleagues, bringing you a variety of perspectives, I'll be talking about the intersection between U.S. public policy and financial markets. It's Wednesday, May 27, at 11:00 a.m. in New York.

Let's take a break from geopolitics this week. Instead, let's talk about games, specifically online gambling. What does online gambling have to do with the challenges facing the world today? Well, it's one way U.S. states may try to cope with their challenged finances, to fill their budget gaps, and that could turn into an opportunity for investors.

You might recall our podcast a few weeks back when we talked about the hole in state budgets. It's going to be as high as $375 Billion in our view. And even if states use their rainy day funds and freeze spending at current levels, they're still over two hundred billion dollars short. Now, of course, Congress could just come in and appropriate that money to the states and there's increased discussion in D.C. about the possibility. But let's assume for a moment this doesn't happen.

This is where online gambling comes in. My colleague Thomas Allen, who covers this sector for our equity research department, has been quick to note that some states have been reticent to approve and tax online gambling. But in light of this deficit, they could reconsider as they're faced with the tough choices of raising taxes, cutting essential spending, or both. Hence, budget stress could be an opportunity for market growth in online gambling, a key benefit to several stocks in the sector.

It's yet another example of how macro trends can create micro opportunities.

Thanks for listening. If you enjoy Thoughts on the Market, please take a moment to rate and review us on the Apple Podcasts App. It helps more people find the show.

Original source: https://www.morganstanley.com/ideas/thoughts-on-the-market-zezas