Getting really annoying to have to keep track of macro events affecting my life year after year instead of just being able to live a normal peaceful life.
How This Ends
71–80 of 698 posts
Re: How This Ends
#72I was very close to switching from a safe-but-boring FAANG type job to a slightly more exciting but very wary stage startup. While there were a few other signals that it might not be the right place for me, the biggest factor was that I wasn’t confident in the company’s ability to survive the next two years, for the exact same reasons the author outlines in that post: tightened money supply spells doom for startups founded when money was flowing freely, especially if they haven’t found a good market fit yet.
Re: How This Ends
#73I'm going to explain what has happened so far. What happens next entirely depends on how inflation continues and the feds reaction. 1. We had zero percent interest rates. This causes the value of assets with cash flows out into the future (think speculative tech, Tesla) to accelerate. 2. We had massive herding in megacap tech. These valuations are high in part because for a decade you would not have beat the index wi…
1. Zero Percent interest rates doesn't necessarily cause a bubble. It's the excess liquidity in the market that causes the bubble (too many financial assets chasing real assets).
One drives the other.
Re: How This Ends
#74Earlier quoted context omitted.
Yes, they did sit down and think that through. That's their job. This is not the first epidemic. Public health departments, unlike people on the Internet, actually study the topic. You might consider sitting down and thinking about who is making these decisions and what their backgrounds are before you pronounce that they didn't take something into account. On what basis are you making that accusation? Do you have an…
>Yes, they did sit down and think that through. That's their job. This is not the first epidemic. So was “Two weeks to flatten a the curve” the plan that just happened to extended into a year or an always an intended lie?
Reality is the public couldn’t handle the facts.
When scientists in the U.K. started talking about herd immunity - the only way out of a pandemic - people went nuts and they quickly had to stop using the term and start reassuring more than informing.
Average pandemic is about four years, not much has changed. They just had to keep people going at the time.
Re: How This Ends
#75Second half of 1940s and early 1950s are, IMO, a much better data point on how asset prices and economy would develop than 1970-80s than the author chooses. The situation in 1940s, with massive post-war government debt and high inflation is a much better match to today's state than 1970s with low debt and high inflation.
There are other huge differences though, right? In the second half of the 40s the US had a giant manufacturing economy whereas the rest of the world's manufacturing output was devastated by the war. I'm not an expert in this area but had the impression that it was this imbalance between the US and the rest of the world that played a huge part in our hegemonic success following that period, so I'm not sure what the purpose of comparing to that period would be, you wouldn't seem to be able to meaningfully extrapolate anything about the future out of it.
Re: How This Ends
#76I wonder how much irreparable damage the lockdowns did to the economy as we knew it before the pandemic. The more subjective aspects of the economy are hard to map - are people motivated enough to work? Do they feel invested enough in the future to work? Have they been burnt out by the yoyo cycle of work/lockdowns? Was their industry severely damaged and they pivoted to other careers? Like there’s a massive pilot sho…
>I wonder how much irreparable damage the lockdowns did to the economy as we knew it before the pandemic. You can also look at it the other way round: The lockdown forced companies to establish home office, something that was overdue for up to 20 years. This can enhance the economy much more in the long run than it harmed during the last two years. Maybe the productivity gains are big enough that they outweigh the am…
Is WFH actually more productive? I've heard conflicting reports, but haven't seen any data.
Re: How This Ends
#77I'm going to explain what has happened so far. What happens next entirely depends on how inflation continues and the feds reaction. 1. We had zero percent interest rates. This causes the value of assets with cash flows out into the future (think speculative tech, Tesla) to accelerate. 2. We had massive herding in megacap tech. These valuations are high in part because for a decade you would not have beat the index wi…
> that bond yields would never normalize. Now that they have, there is a risk free alternative to stocks. Treasury bond yields are 3%, inflation is 8.5%, so in real terms you are guaranteed to lose 5.5% annually if you hold bonds. Or basically instead of risk-free gain you are holding gain-free risk.
This is the truth. What people do not understand is that interest rates will have to rise above inflation for in inflation to slow down. I assume the FED is trying to figure out how much inflation is caused by the money supply and how much is caused by supply chain issues. But too me this means even more trouble because they are waiting when there was obvious asset inflation well before the supply chain issues.
IMHO, we will not see a recession, we already are in a recession. What we will see a depression.
Re: How This Ends
#78I'm going to explain what has happened so far. What happens next entirely depends on how inflation continues and the feds reaction. 1. We had zero percent interest rates. This causes the value of assets with cash flows out into the future (think speculative tech, Tesla) to accelerate. 2. We had massive herding in megacap tech. These valuations are high in part because for a decade you would not have beat the index wi…
Target shocked investors because not only did they suffer from rising costs due to inflation that they are currently subsidizing by not meaningfully raising prices but because they reported rising inventory in discretionary spending categories as consumers pull back likely due to higher prices they are facing nearly everywhere.
This has more to due to impact of inflation and less so just a function of a dividend and rates.
Re: How This Ends
#79I'm going to explain what has happened so far. What happens next entirely depends on how inflation continues and the feds reaction. 1. We had zero percent interest rates. This causes the value of assets with cash flows out into the future (think speculative tech, Tesla) to accelerate. 2. We had massive herding in megacap tech. These valuations are high in part because for a decade you would not have beat the index wi…
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Re: How This Ends
#80I have a real problem with pieces like this that define "recession" in terms of abstract measurements of bits of the economy. Real recessions are about actual people and their lives, and although there's a definite correlation between the sorts of measures cited here and people's lives, it's much weaker than the article implies. We have very low unemployment right now, and most the features of a people-affecting rece…
Employment and wages are lagging indicators, which is why folks are worried.