Just buy the index like everyone else will be doing. TINA
Ask HN: What tech companies/industries will do well in a recession?
151–160 of 184 posts
Re: Ask HN: What tech companies/industries will do well in a recession?
#152Earlier quoted context omitted.
Just have a look which companies did good during corona, or which businesses were not affected by the lock down. Those are the real essential ones, which will be safe in a recession.
This is a very different setup than 2020. Governments are done dumping trillions of dollars on the problem.
As long as there are cronies there will never not be bailouts
Re: Ask HN: What tech companies/industries will do well in a recession?
#153Related question: which tech products are 'inferior goods' - goods whose demand rises when incomes fall https://en.wikipedia.org/wiki/Inferior_good
If uber/lyft were cheaper (especially during peak) this would be the future of "inferior goods". Honestly, they should be taking pennies on the dollar for each ride instead of their current rate in order to secure their place in transportation.
Re: Ask HN: What tech companies/industries will do well in a recession?
#154Don't invest for the winners in the recession. Invest near the depths of the recession for the winners of the recovery where everything looks like its on a firesale. The problem is of course timing the bottom. And resisting the emotional urge to think nothing could ever recover. The 2020 extraordinarily V-shaped recovery surprised me a lot. Given that nothing financial is really popping that hard and a lot of the hea…
So if you're sure that it's going to go into a recession, you invest in medium-to-long-term bonds, because recessions cause interest rates to fall, and bond prices go up as interest rates fall. Then, approximately when the recession hits bottom, sell the bonds and buy stocks.
Note that this requires that you approximately time the market twice, which can be difficult. Also hazardous.
Note well: I am not a financial advisor. Follow this advice at your own risk.
Re: Ask HN: What tech companies/industries will do well in a recession?
#155I suppose we could also frame the question as which tech companies and industries will NOT do well during the recession. I think that streaming services will not do well. People will return to torrenting and piracy. Same with crypto trading platforms. Basically any place where Joe Average can't afford to spend more than he has on hand. Tesla will see a big drop too, as people will cash out to buy their groceries. As…
AI/ML is a bit of a wildcard for me. On the one hand, I’m certain many companies will be eager cut costs through automation. On the other, investors will likely grow cold if the results just can’t live up to the hype fast enough.
The results are living up. ML is integrated into the core of so many companies at this point it’s not like it was 10 years ago. ML is here to stay and it will be almost the entire economy in the not to distant future
Re: Ask HN: What tech companies/industries will do well in a recession?
#156Earlier quoted context omitted.
AI/ML is a bit of a wildcard for me. On the one hand, I’m certain many companies will be eager cut costs through automation. On the other, investors will likely grow cold if the results just can’t live up to the hype fast enough.
And the hype won’t deliver fast enough. What has not been automated today will not be automated (robustly) in two years time.
There is hype and then there is practical ML which is integrated and working in lots and lots of companies today
Re: Ask HN: What tech companies/industries will do well in a recession?
#157Earlier quoted context omitted.
Non-car modes of powered transit - small petro scooters, e-bikes, etc. People always need to get around in a non sweaty way but a car is both a lead weight financially and a potential windfall when car prices are artificially high.
I don't see these being true unless you live in an area where getting around on a bike is actually realistic. Basically not USA, even the metro areas, except for maybe a handful.
I lived in a van with an e-bike for a year and traveled the United States extensively in both modes. I can assure you that getting around on an e-bike is realistic pretty much everywhere in USA. Even over long distances or hilly terrain or in the hot or in the cold. I agree that the comfort of the car makes people 'soft' and so entrepreneurs looking to sell alternative modes of transport need to work hard at allaying the concerns that you imply with your worldview if they want to get customers out of cars.
Re: Ask HN: What tech companies/industries will do well in a recession?
#158Related question: which tech products are 'inferior goods' - goods whose demand rises when incomes fall https://en.wikipedia.org/wiki/Inferior_good
If uber/lyft were cheaper (especially during peak) this would be the future of "inferior goods". Honestly, they should be taking pennies on the dollar for each ride instead of their current rate in order to secure their place in transportation.
They're already losing billions each year. You want them to lose more?
Re: Ask HN: What tech companies/industries will do well in a recession?
#159Don't invest for the winners in the recession. Invest near the depths of the recession for the winners of the recovery where everything looks like its on a firesale. The problem is of course timing the bottom. And resisting the emotional urge to think nothing could ever recover. The 2020 extraordinarily V-shaped recovery surprised me a lot. Given that nothing financial is really popping that hard and a lot of the hea…
While I agree with much of your first couple sentences and resisting the emotional urge to think recovery is impossible, you're walking a hazardous line between believing recession timing is effectively impossible and trying to ballpark near term recession risk.
I preach this: nobody can reliably predict recessions but everyone should know recessions will happen. It would be damn near impossible to predict recessions if you had a single large country only trading with itself. Throw in the billions of people in the global economy, each a market participant, and the task becomes intractable. The macroeconomists and policy wonks sound much like you do: identifying real risks and evaluating sentiment in an attempt to convince others, and themselves, that they have special insight. I try not to be a cynic - there's enough negativity on HN - but I really think recession prediction is an exercise in futility.
Still, it's critical to expect recessions. Buying stock in a company that's selling for 100x revenue and would go bankrupt in the event of a recession is gambling. Likewise, leaving the market and putting your money in gold, Bitcoin, your mattress, etc because you think recession is around the corner is likely to burn you. Yes, Michael Burry and The Big Shorters made a ton of money betting on what would coincide with a recession... but some of them would've gone broke had the timing stretched on even longer.
In short, your best bet if you're scared of recessions is the same as your best bet if you're in a boom or in the middle of a recession: buy undervalued assets and hang on to them long enough for everyone else to recognize their value. And, since recessions happen regularly at an irregular interval, your job will be made much easier if those assets can simply survive a recession.
Re: Ask HN: What tech companies/industries will do well in a recession?
#160Faang companies are printing cash. Instead of making 50bil maybe they will only make 45.
faang like facebook or netflix? I think it’s time people stop using this acronym
Even in India people use FAANG where 3 of these are missing. It’s become an equivalent now of top payers who are also stable employers.