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The Entire Economy Is MoviePass Now

nytimes.com

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Re: The Entire Economy Is MoviePass Now

#111

Post by Veelox »

StanislavPetrov wrote: post #50
dragonwriter wrote: post #30

Earlier quoted context omitted.

QEs been tapering off for a long time (US QE ended in 2014); there's very little reason to believe that it's global final (for now) end will do much to capital markets.

This only means that the FED hasn't been increasing its purchases since 2014. It has maintained an over $4 Trillion (trillion with a T) balance sheet, and it continues to roll this money over. Ending QE would mean stopping repurchasing and letting the balance sheet shrink - quite different in substance and effect than tapering. https://www.federalreserve.gov/monetarypolicy/bst_recenttren... This also ignores the fact…

If you think the bubble is going to pop you should take out some options and you should be able to make a killing.

Re: The Entire Economy Is MoviePass Now

#112

Post by blueyes »

Joel Spolsky addressed this, much more insightfully, in one of his early strategy letters:

https://www.joelonsoftware.com/2000/05/12/strategy-letter-i-...

There are real reasons why companies like MoviePass exist, why companies like Snap lose money, and why investors back them. It's just a land grab where you have to move fast to establish dominance.

Re: The Entire Economy Is MoviePass Now

#113

Post by michaelchisari »

r00fus wrote: post #103
TylerE wrote: post #77

Earlier quoted context omitted.

Raising prices may even make things worse, as it will just narrow their customer base to those that are most expensive to service.

How are higher-paying customers more expensive to service?

More likely to use their service regularly. At $10 you have a certain percentage which will go once a month. At $50 you only attract the people who go twice a week.

Re: The Entire Economy Is MoviePass Now

#114

Post by soVeryTired »

crazygringo wrote: post #32
andrewjrangel wrote: post #4

I am curious if this will end with a "bubble-burst" or a slow burn like twitter has experienced. Surely the money has to dry up sometime? It is too bad that none of these companies create any kind of net good for society like a startup that pays you over minimum wage to clean up a park or sort recycling.

> Surely the money has to dry up sometime? Why? A bit simplified, but think of the money as coming from the profits from the companies that have been successful. It's just how investment works. And when you add up all the gains and losses, it's still a net positive as the economy grows a little bit more year after year. And what do you mean no net good? The companies create jobs which create huge amounts of income ta…

> A bit simplified, but think of the money as coming from the profits from the companies that have been successful.

To be honest, most of the money is coming from pension funds, endowments, and state bodies (i.e. large institutions with monstrous piles of money). They allocate most of that money to post-IPO stocks and bonds, but they'll hand over a small fraction to 'alternative investments' too.

Post-financial crisis, when interest rates came tumbling down, two things happened. First, bondholders (i.e. large institutions) made a lot of money. Second, bonds became less attractive as an investment, making alternatives like early stage tech look good in comparison.

It's partly accurate to say that the hot money pouring into silicon valley comes from previous companies' successes. But a lot of the money is coming from 'me too' institutional investors who are chasing previous investment performance.

> The companies create jobs which create huge amounts of income taxes...

It's possible to create jobs wastefully. I could pay ten people to dig a trench while I pay ten other people to fill it in. Your arguments would seemingly still stand, but not much of value would get built.

Re: The Entire Economy Is MoviePass Now

#115

Post by nickparker »

crazygringo wrote: post #32
andrewjrangel wrote: post #4

I am curious if this will end with a "bubble-burst" or a slow burn like twitter has experienced. Surely the money has to dry up sometime? It is too bad that none of these companies create any kind of net good for society like a startup that pays you over minimum wage to clean up a park or sort recycling.

> Surely the money has to dry up sometime? Why? A bit simplified, but think of the money as coming from the profits from the companies that have been successful. It's just how investment works. And when you add up all the gains and losses, it's still a net positive as the economy grows a little bit more year after year. And what do you mean no net good? The companies create jobs which create huge amounts of income ta…

Jobs aren't intrinsically good. These startup jobs might be, but it's an insanely complex system you're trying to suss a value judgement out of.

If these startups didn't exist, the money going into them would be seeking returns elsewhere. There would probably be jobs involved there too, and the people working those jobs might be doing something better for society than building a short-lived money-losing consumer product.

If the mysterious "elsewhere" didn't create jobs with the money say because it was spent on capital assets, that's still not the end of the story. Wherever it went, someone else has it now and they're probably spending it, perhaps hiring some people with it ie creating jobs.

The simple interpretation of your second line is the broken window fallacy, which is false. The grasping-at-straws interpretation is that paying software engineers to work on junk is a better than average way to route capital through our economy - measured in terms of how much real value the capital produces for people as it changes hands from company to coder + tax man, coder to shopkeeper + tax man, and tax man to public works employees, etc forever. I don't think we could possibly measure the latter interpretation, but I don't believe it.

Re: The Entire Economy Is MoviePass Now

#116

Post by Mahn »

protonimitate wrote: post #14
vinhboy wrote: post #9

> Enjoy It While You Can I love the conclusion of this article. As someone who has participated in the online "deals" community for 10+ years, I have definitely benefitted from many of the opportunities. However, I do spend a considerable amount of time wondering what will happen when this house of cards comes falling down. But you know, I think that for every one person like me taking advantage of these "arbitrage"…

Yup. I know things are too good to last, but (for the time being) I am happy to be on the 'winning' side of bad investments. I'm curious what is attracting investors to these start ups in the first place, is it really just the idea that 'this could be the next amazon'? As the article pointed out - Amazon dumped a ton of its money back into the company to expand services. Most of these burn rate services are happy wit…

> what is attracting investors to these start ups in the first place

Growth, basically. As long as you can make a case that your 75 cent dollar store is rapidly accumulating customers, investors will be more than happy to overlook the economics of the business. Sometimes that works out, but I guess at that point it's more like gambling than investing for investors.

Re: The Entire Economy Is MoviePass Now

#117

Post by danharaj »

Veelox wrote: post #111
StanislavPetrov wrote: post #50

Earlier quoted context omitted.

This only means that the FED hasn't been increasing its purchases since 2014. It has maintained an over $4 Trillion (trillion with a T) balance sheet, and it continues to roll this money over. Ending QE would mean stopping repurchasing and letting the balance sheet shrink - quite different in substance and effect than tapering. https://www.federalreserve.gov/monetarypolicy/bst_recenttren... This also ignores the fact…

If you think the bubble is going to pop you should take out some options and you should be able to make a killing.

If you blow a bubble, I won't know how long it'll float around before it pops. But I know it's going to pop.

Re: The Entire Economy Is MoviePass Now

#118

Post by quickben »

basch wrote: post #96
mabbo wrote: post #16

> The king of money-losers, of course, is Amazon, which went years without turning a profit. Instead, it plowed billions of dollars back into its business The key difference with Amazon is that Amazon could choose to be profitable at any time- just raise prices ever so slightly, reducing growth in customer demand, and the stop building out its enormous logistics empire and new businesses. Amazon could have had profit…

there is a very solid argument that what Amazon is doing IS an antitrust issue. http://www.yalelawjournal.org/note/amazons-antitrust-paradox

Except it is not, because US is near full employment, so bribes go long way to avert the looks. Until a solid recession hits, and double digit unemployment is in, corps like Amazon will never be on the quartering table by the masses.

Re: The Entire Economy Is MoviePass Now

#119

Post by mmt »

vinhboy wrote: post #9

> Enjoy It While You Can I love the conclusion of this article. As someone who has participated in the online "deals" community for 10+ years, I have definitely benefitted from many of the opportunities. However, I do spend a considerable amount of time wondering what will happen when this house of cards comes falling down. But you know, I think that for every one person like me taking advantage of these "arbitrage"…

> But you know, I think that for everyone person like me taking advantage of these "arbitrage" scenarios, there are like 10 people paying full price. They keep this economy going.

That seems contrary to what the article is saying, which is that for every person taking advantage, there are zero people paying full price, because it's the investors who are keeping this economy going.

As such, it may never end without a regulatory end to the winner-take-all scenario, as a different comment suggested.

Re: The Entire Economy Is MoviePass Now

#120

Post by Mahn »

autokad wrote: post #55
andrewjrangel wrote: post #4

I am curious if this will end with a "bubble-burst" or a slow burn like twitter has experienced. Surely the money has to dry up sometime? It is too bad that none of these companies create any kind of net good for society like a startup that pays you over minimum wage to clean up a park or sort recycling.

from the article: “The fact that Google and Facebook were able to generate such enormous profits and growth does give hope to some companies,” IF the bubble bursts, companies that seemed profitable might not remain so. companies like Facebook have made a fortune in advertising on things such as mobile (80% of its revenue), which to my knowledge really doesn't work. likewise a lot of desktop adds don't work, but many…

Your knowledge is wrong.
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