Square to acquire Afterpay for $29B • Hacker News Board

Re: Square to acquire Afterpay for $29B

#211

Post by askvictor » Mon, Aug 02, 2021, 7:04 AM UTC

geekpowa wrote: post #128

Afterpay's business model relies on high merchant fees which merchants, under their merchant agreement, are not allowed to pass onto their customers. So from customers point of view, afterpay often appears to be cheaper than other payment channels such as credit card / paypal. Afterpay roll into a new merchant, cannibalise existing payment systems and at leat for the low margin merchants I work with, who are not savv…

I would also presume they're harvesting data on how you spend your money, so it can later be sold or used for other targeting. I haven't looked into this in any depth, but IIRC credit cards are not allowed to do this, but other services aren't held to the same standards.

Re: Square to acquire Afterpay for $29B

#212

Post by fungizid » Mon, Aug 02, 2021, 7:07 AM UTC

JohnJamesRambo wrote: post #188

BugsJustFindMe wrote: post #47

Every time I see one of these announcements, the valuations go up and up and up and up. I remember not long ago being wowed by a 1B acquisition. That was called a unicorn because of how incredible it was. And now we're at 29B. Is this just because money is all a joke?

Yes money is all a joke right now. https://fred.stlouisfed.org/series/M1SL

The steep increase at the end mostly does not reflect a change in economic fundamentals but rather banks relabeling savings accounts as transaction accounts in response to regulatory changes. If you look at M2 instead of M1, the increase disappears.

More info: https://fredblog.stlouisfed.org/2021/05/savings-are-now-more...

(Edit: Updated link to a more recent blog post)

Re: Square to acquire Afterpay for $29B

#213

Post by kart23 » Mon, Aug 02, 2021, 7:07 AM UTC

I've seen the afterpay button when shopping online. Hate to say it, but this is absolutely taking advantage of people with poor spending & saving habits. I see it mostly at overpriced/luxury/hype online stores, where the desire to own a product doesn't come from a place of need, but from society & marketing. I buy some of this stuff, so I'm not hating on that. But some people are truly addicted to shopping, and enabling that is morally wrong.

Re: Square to acquire Afterpay for $29B

#214

Post by buster » Mon, Aug 02, 2021, 7:07 AM UTC

osrec wrote: post #205

JohnJamesRambo wrote: post #188

Earlier quoted context omitted.

Yes money is all a joke right now. https://fred.stlouisfed.org/series/M1SL

Is that massive jump covid related?

I don't understand the difference but the text below particularly points out a change in measurement in May, 2020. I suppose that's the reason.

Re: Square to acquire Afterpay for $29B

#215

Post by irjustin » Mon, Aug 02, 2021, 7:08 AM UTC

jl6 wrote: post #209

JohnJamesRambo wrote: post #188

Earlier quoted context omitted.

Yes money is all a joke right now. https://fred.stlouisfed.org/series/M1SL

Can someone explain why x4’ing the money supply hasn’t ÷4’d the value of the dollar? Yet?

The new thinking is money supply/debt vs GDP doesn't necessarily equate to inflation.

Re: Square to acquire Afterpay for $29B

#216

Post by AQuantized » Mon, Aug 02, 2021, 7:09 AM UTC

throwawayzRUU6f wrote: post #191

paxys wrote: post #176

Earlier quoted context omitted.

Back when 1B acquisitions were considered incredible most of the world did not know what the internet was. If the size of the pie grows 30X the amount of money in it will as well.

Just several years ago, Facebook IPO-ed at ~$90B valuation, before sliding all the way down to ~$45B. Facebook was already a giant global corporation with close to a billion active users, nearly all of them from western countries. AfterPay's valuation puts it at two thirds of mid-2012 Facebook. Up until now, I've never heard of them

'several years' in this case being almost a decade

Re: Square to acquire Afterpay for $29B

#217

Post by greenbeans1991 » Mon, Aug 02, 2021, 7:10 AM UTC

kart23 wrote: post #213

I've seen the afterpay button when shopping online. Hate to say it, but this is absolutely taking advantage of people with poor spending & saving habits. I see it mostly at overpriced/luxury/hype online stores, where the desire to own a product doesn't come from a place of need, but from society & marketing. I buy some of this stuff, so I'm not hating on that. But some people are truly addicted to shopping, and enabl…

How is it different than credit cards?

Re: Square to acquire Afterpay for $29B

#218

Post by xiphias2 » Mon, Aug 02, 2021, 7:15 AM UTC

jl6 wrote: post #209

JohnJamesRambo wrote: post #188

Earlier quoted context omitted.

Yes money is all a joke right now. https://fred.stlouisfed.org/series/M1SL

Can someone explain why x4’ing the money supply hasn’t ÷4’d the value of the dollar? Yet?

The banking cartel controls where the newly printed money (debt) goes first by controlling interest rates (governments, big banks, stocks, bonds and houses get the best rates near 0%, and Aftermarket and credit card customers get 30%

Re: Square to acquire Afterpay for $29B

#219

Post by rwmj » Mon, Aug 02, 2021, 7:16 AM UTC

J253 wrote: post #144

ZephyrBlu wrote: post #135

Earlier quoted context omitted.

I'm an early 20s Kiwi zoomer, so somewhat similar demographic. I don't have a credit card and see no point in it. I use a debit card for everything. I don't think most of my friends have credit cards either, but maybe they do and I don't notice.

> I don’t have a credit card and see no point in it. If you use a credit card like a debit card (pay it off in full every month) it can be rewarding depending on the card. I make $75-$100 cash back every month on my credit card.

Where does the $75-$100 come from? Is it that prices are generally more expensive, or is it a transfer from people who get into terrible debt?

Re: Square to acquire Afterpay for $29B

#220

Post by danielmarkbruce » Mon, Aug 02, 2021, 7:20 AM UTC

ComputerGuru wrote: post #193

danielmarkbruce wrote: post #106

Earlier quoted context omitted.

If you look at interest rates from 1990 to now, and average household debt, it's easy to see why the economy has been up up up up. People have been spending way more money than they make for 30 years in Australia. That will make any economy boom. The difficult thing is... when does it stop? The above could have been said 10 years ago, just replace the 3 with a 2. Should it have stopped then? Now? In 10 more years?

That type of economy (powered by extreme consumerism beyond the customers’ means) isn’t unique to Australia. It’s only sustainable so long as the target population continues to increase (kind of like social security). The forecasted global population drop that will hit home in the next 15-20 years is going to completely destroy economies propped-up by fake money.

It's not unique, but in the first world Australia has gone from being ranked one of the lowest in average household debt in 1990 to one of the very highest in 2021.

It's not fake money. It's likely not even "beyond means". The debts can likely be paid back. But it seems quite unlikely the level of spending can continue to grow.