no. VCs primarily fund stupid ideas and make choices based on emotion and ego and not common sense. they also have strong ideas about where markets and trends are going which are at best based on analyst reports and cocktail reception chatter. so the end result is always disappointment. occasionally they gambled right. what should happen is that they should fund a wider variety of businesses in more markets and not just focus on one specific type of startup.
Ask HN: Has your view of Silicon Valley changed in the last 72 hours?
101–102 of 102 posts
Re: Ask HN: Has your view of Silicon Valley changed in the last 72 hours?
#102Earlier quoted context omitted.
I think it was quite fair to think they could have sold 10 year treasuries at cost at least. An invert yield curve for this long is not normal. But yes maybe they should have laddered better.
>An invert yield curve for this long is not normal. Risk management at financial institutions isnt meant to be an exercise of expecting or planning for the normal. Any way we slice it, they failed to adequately assess risk.
You understand that’s the silliness of risk management. Anyone who failed is always accused of not managing it. It’s a truism.
You can’t prepare for all outcomes and this was not one a bank expects. A 3 day 40 billion dollar draw down maybe a first ever event for any bank in all of history. Should they also have risk managed for a nuclear bomb going off in their lobby?
Get real man. Recognize that you are Monday morning quarterbacking here.