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41,000,006 reasons why I think we're in a bubble

jacquesmattheij.com

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Re: 41,000,006 reasons why I think we're in a bubble

#231

Post by davidmathers »

As the great philosopher Inigo Montoya once said: "You keep using that word..."

Let's talk about this chart for a second:

http://www.google.com//finance?chdnp=1&chdd=1&chds=1...

Ok, see that 4000% increase in 18 months? That's what a bubble looks like.

Now, please point out to me where on the graph it made more sense to invest your retirement money in the S&P 500 rather than Amazon.

Wait, you mean pets.com, not amazon.com? Fair enough. But now I'm not sure what your argument is. That color.com is going to fail and the investor are going to lose all their money?

That is what you're saying right? Because if you're saying they're taking a large risk that has a very small chance of paying off then you're saying nothing. That's what investors do. That's what makes us (as a society) all rich.

If your argument is that capital is being misallocated then you have to say why and where the capital should be allocated.

Which brings us to what is actually a bubble and not just people with lots of money taking big risks that may not pay off:

1. capital being invested by (otherwise) non-investors

2. who can't afford to lose

3. who have come to believe, with certainty, that they can't lose

That was the case in both the stock bubble and real estate bubble. It's not the case now. I guess the headline "valuations are unrealistically high" wouldn't generate as much heat and would require a coherent defense.

Re: 41,000,006 reasons why I think we're in a bubble

#232

Post by moe »

bhousel wrote: post #173
klochner wrote: post #169

Earlier quoted context omitted.

That's pure bubble talk - "we don't have to generate profit to justify the investment, we'll just get acquired by someone else" SOMEONE has to generate a profit based on the technology which justifies the investment or acquisition cost, whether it's color or their eventual acquirer.

And I'm saying, the acquisition is already planned and these investors aren't investing in Color, they're essentially investing in Facebook pre-IPO without going through Goldman's special investment vehicle. None of the investors mentioned (Sequoia, Bain Capital, SV Bank) are Facebook investors yet.

But... what if facebook just buys one of the inevitable competitors for a fraction of the price? Or builds the feature on their own?

So far I'm missing the special sauce that makes them a must-buy-can't-clone.

Re: 41,000,006 reasons why I think we're in a bubble

#233

Post by rapind »

dgabriel wrote: post #182
theklub wrote: post #181

Earlier quoted context omitted.

You may not be aware but there are a lot of other websites taking money from women. IE. shoe website innovations. I recall there was also some fashion site at TC Disrupt that reminded me of Swoopo. I wonder what happened to it.

Women are interested in much more than fashion and shoes (and there are many men who are interested in fashion and shoes). The market seems pretty poorly understood by tech innovators.

"Women are interested in much more than fashion and shoes" - source please.

Re: 41,000,006 reasons why I think we're in a bubble

#234

Post by borism »

yummyfajitas wrote: post #196
anamax wrote: post #188

Earlier quoted context omitted.

> Inflation helps the proletariat, you know. Most of them are net debtors, so inflation makes it easier to pay off their debts. Not so fast. Lenders factor in expected inflation, so it's only unexpected inflation that benefits debtors. And, making payments isn't the only way to handle debt - bankruptcy works too. You don't get any more "pay later" pizzas, but you get to keep the ones that you already ate. However, in…

It's true that a higher inflation regime will not help debtors. But the net effect of an event like QE/QE2 is to help debtors.

But the net effect of an event like QE/QE2 is to help debtors.

Let's be serious here. Net effect of QE is 0.

Re: 41,000,006 reasons why I think we're in a bubble

#235

Post by chc »

ebiester wrote: post #227
bambax wrote: post #217

Earlier quoted context omitted.

> Women have money. Go take it. What do they want?!? I could never figure that one out.

It's about what humans want. Humans act the same, for the most part, accounting for cultural differences. (Fashion is an example of a cultural difference, In Turkey, for example, men often place as much importance on being stylish as American women do.) So, think culture development. Talk To Customers. (And don't try to flirt. Look at their faces. Write notes.) Talk to them both individually and in groups. Have a par…

This is common advice, but I find it frustratingly vague. Talk to people? I talk to people all the time. Heck, I talk to women all the time — half my friends are women, I currently live with two female housemates and used to live with a third, and my mother is a middle-aged office manager. After years of talking to them, I can only conclude that I've missed the boat on making Facebook, Etsy, The Sims and Model Mayhem.

I imagine a lot of people are in the same boat. It's hard to talk to people in a way that reveals product opportunities. That's why they make things for the only people who will actually tell them what they want — themselves.

Re: 41,000,006 reasons why I think we're in a bubble

#236

Post by dgabriel »

rapind wrote: post #233
dgabriel wrote: post #182

Earlier quoted context omitted.

Women are interested in much more than fashion and shoes (and there are many men who are interested in fashion and shoes). The market seems pretty poorly understood by tech innovators.

"Women are interested in much more than fashion and shoes" - source please.

http://knowledge.wharton.upenn.edu/article.cfm?articleid=793

Also, your joke is not funny.

Re: 41,000,006 reasons why I think we're in a bubble

#237

Post by etherael »

Uhhrrr wrote: post #184
dmarinoc wrote: post #174

Earlier quoted context omitted.

They do not only have money. They have a strong influence (and almost always the last word) in most of end-consumer buying decisions. It's strange so little companies focus on them

People are taught to focus on a market they understand, specifically themselves if nothing else. Women, on the other hand, are hard to understand, even to other women.

really?

http://www.neosprockets.com/index.php/2010/01/chick-flick-ge...

Re: 41,000,006 reasons why I think we're in a bubble

#239

Post by jacques_chester »

danenania wrote: post #129
api wrote: post #100

Earlier quoted context omitted.

I personally think that the fed now has no choice but to pump money at zero (to effectively negative) interest forever. There's a number of reasons for this: demographics, peak oil, the massively deflationary effect of certain technologies, etc. The west really looks a lot like Japan, which has pumped cheap money since their economy went through a similar cycle of stock bubble, real estate bubble, and crash. So expec…

The question is what happens if/when inflation gets out of hand. Raising rates causes deflationary collapse, mass unemployment, and default on government debt. Keeping them low risks crippling inflation which could lead to social instability even in the US. What's a Fed Chairman to do? Deflationary collapse is the only path back to a sustainable model, but it's extremely painful in the short term and so nearly unthin…

> What's a Fed Chairman to do?

In Australia, inflationary breakout led to the "Recession we had to have". Our Reserve Bank governor quite brutally broke the back of inflation in the late 80s to early 90s [1], culminating in an early 90s recession. With a quite conservative monetary policy we've done quite well since then.

(The mining boom has been a free kick though).

[1] http://www.smh.com.au/news/Opinion/How-the-recession-we-had-...

Re: 41,000,006 reasons why I think we're in a bubble

#240

Post by jacques_chester »

tyng wrote: post #117
yannickmahe wrote: post #73

What I don't get, economically speaking, is how we can both be in a bubble and in a barely recovering economy. In other words, how do these angels and VCs still have that much money to invest in such companies?

Ever heard of the term "two-speed economy"? It's happening right now on a much larger scale in Australia.

Indeed. Today in The Australian there was a story about laundry hands on offshore rigs being paid ~$420k.

http://www.theaustralian.com.au/national-affairs/laundry-sta...

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