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“A solution in search of a problem” is a low-rates phenomenon

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Re: “A solution in search of a problem” is a low-rates phenomenon

#41

Post by makestuff »

jchw wrote: post #23
malfist wrote: post #2

I thought this article had a good rule on how to differentiate dead end "solution in search of a problem" inventions and ones that might be successful. > whether the technology does something that would be useful if everyone had it, but is relatively useless at small scale I've often told my partner a lot of his "smart home" devices are solutions in search of problems. It seems to ride this line. Probably why despite…

I love smart home stuff, but greatly prefer open source compatible (Home Assistant etc), non-internet-connected smart home equipment that still has hardware switches. There's no good standard for RGBW addressability over wires here in the U.S. (that I'm aware of) so I do use some Philips Hue bulbs, but only accompanied by a hard-wired switch capable of associating directly with the bulb, so that all it needs to work…

Yeah if someone came out with a piece of hardware that could run the an NLP model to detect the common phrases (turn lights on/off, play music, etc.) and then have it prepackaged with home assistant it would ruin a lot of these cloud connected devices.

Re: “A solution in search of a problem” is a low-rates phenomenon

#42

Post by recursive »

ElevenLathe wrote: post #37
xyzelement wrote: post #34

Earlier quoted context omitted.

Hang on... This sub-thread is venturing into the territory of lumping airlines with "solutions in search of a problem" and that just doesn't make any sense to me. You can argue that airlines have not returned on the capital (it may be true, I have no idea) but there's clearly demand and utility for the product, as evidenced by nearly every flight being nearly or completely full at all times.

An industry basically can't ever make a profit is not a solution to anything.

So that would be a problem without a solution.

Re: “A solution in search of a problem” is a low-rates phenomenon

#43

Post by mym1990 »

ElevenLathe wrote: post #37
xyzelement wrote: post #34

Earlier quoted context omitted.

Hang on... This sub-thread is venturing into the territory of lumping airlines with "solutions in search of a problem" and that just doesn't make any sense to me. You can argue that airlines have not returned on the capital (it may be true, I have no idea) but there's clearly demand and utility for the product, as evidenced by nearly every flight being nearly or completely full at all times.

An industry basically can't ever make a profit is not a solution to anything.

United Airlines making 10 billion a quarter doesn't sound like its in an industry that has no profit.

Re: “A solution in search of a problem” is a low-rates phenomenon

#44

Post by lazide »

xyzelement wrote: post #35
mberning wrote: post #31

Earlier quoted context omitted.

Homes and cars are simply out of control. People are getting mortgage sized loans just to buy a family car. Something which will become worthless over 10 years of use. Getting a mortgage on a home is now a non-starter for a huge swath of the population. I suppose I can somewhat understand the price of homes going up. It's a durable item that, if reasonably maintained, has an unlimited useful life. A car on the other…

// People are getting mortgage sized loans just to buy a family car I mean... That's insane hyperbole right? Below you are talking about $30k cars, in what universe does that approach "mortgage sized"?

Depending on your selection of ‘people’ it isn’t that odd - anyone financing a Tesla Model X for instance, is looking at $120k+ prices, and there are a LOT of them in many parts of the Bay Area.

Re: “A solution in search of a problem” is a low-rates phenomenon

#45

Post by mberning »

xyzelement wrote: post #35
mberning wrote: post #31

Earlier quoted context omitted.

Homes and cars are simply out of control. People are getting mortgage sized loans just to buy a family car. Something which will become worthless over 10 years of use. Getting a mortgage on a home is now a non-starter for a huge swath of the population. I suppose I can somewhat understand the price of homes going up. It's a durable item that, if reasonably maintained, has an unlimited useful life. A car on the other…

// People are getting mortgage sized loans just to buy a family car I mean... That's insane hyperbole right? Below you are talking about $30k cars, in what universe does that approach "mortgage sized"?

A $30k car would be something basic like a corolla or civic. When you start talking about larger family cars, $50k is really the low end of what you find on dealer lots. Bear in mind, the MSRP of a vehicle and what you can actually find to buy is quite different. And $50k is a common entry point. Prices escalate quickly from there. My point being that you used to be able to buy a new car such as a civic or corolla for closer to $10k than $30k. I bought a brand new Mazda 3 for $13k in 2006. And there were tons of them on the dealer lot and they worked with me on the price. Nowadays if you head down to the Mazda dealer you might be lucky to find one just under $30k.

Re: “A solution in search of a problem” is a low-rates phenomenon

#46

Post by mym1990 »

obblekk wrote: post #24

I really dislike these takes on low interest rates. As far back as the 70s (when interest rates were 8-15%), there have been random business ideas being started and shutdown (pet rocks, every airline ever, etc.). We don't remember those because they shutdown 40 years ago. Today, we only see the successful ones that survived (walmart, fedex, etc.). There's a legit question: why have long term interests declined over t…

The case for decrease of human talent(however you quantify that kind of metric, if it is even true) likely has little to do with population growth, and rather the quality of education that can be provided to a broad population.

Re: “A solution in search of a problem” is a low-rates phenomenon

#47

Post by ak_111 »

makestuff wrote: post #36
ak_111 wrote: post #22

I am wondering how much of the excessive (even to the point of lunacy) funding of stupid ideas in tech is due to a low-rate macro environment as opposed to a spray-and-pray gold rush that naturally gets triggered whenever someone hits gold in an area. After all it is hard to argue that AdSense, iPhones and AWS are not hugely profitable paradigm-shift innovations that would thrive in even the harshest macro environmen…

I will be interested to see how much of a hit AWWS/Azure/GCP takes during this downturn. Suddenly startups are not going to be spending millions per year on cloud stuff stuff that they don't really need (ex: massive redshift cluster for your "data collection"). Furthermore, a large number of startups will cease to exist. I would guess large customers have account for a massive portion of cloud revenue; however, they…

I would be very surprised how much of start-ups spending is driving AWS adoption (it's probably less than 5-10% of their revenue). In the UK alone a huge chunk of the public sector and FTSE100 corporate sector has migrated to AWS and Azure to the point where they are national security risk.

Re: “A solution in search of a problem” is a low-rates phenomenon

#48

Post by lazide »

ak_111 wrote: post #22

I am wondering how much of the excessive (even to the point of lunacy) funding of stupid ideas in tech is due to a low-rate macro environment as opposed to a spray-and-pray gold rush that naturally gets triggered whenever someone hits gold in an area. After all it is hard to argue that AdSense, iPhones and AWS are not hugely profitable paradigm-shift innovations that would thrive in even the harshest macro environmen…

Low rates throw fuel on the fire by reducing the return on other viable options, and if in the presence of other asset inflation, helping to drive desperation for ‘positive’ returns.

If the safe option goes from ‘T-bills that don’t lose you money’ to ‘T-bills that defacto lose you 3-5% a year relative to price inflation in every asset you care about’, risk appetite increases.

Think of it like an investing Overton window.

They didn’t start the fire, but boy did they make it quite the bonfire.

Re: “A solution in search of a problem” is a low-rates phenomenon

#49

Post by makestuff »

ak_111 wrote: post #47
makestuff wrote: post #36

Earlier quoted context omitted.

I will be interested to see how much of a hit AWWS/Azure/GCP takes during this downturn. Suddenly startups are not going to be spending millions per year on cloud stuff stuff that they don't really need (ex: massive redshift cluster for your "data collection"). Furthermore, a large number of startups will cease to exist. I would guess large customers have account for a massive portion of cloud revenue; however, they…

I would be very surprised how much of start-ups spending is driving AWS adoption (it's probably less than 5-10% of their revenue). In the UK alone a huge chunk of the public sector and FTSE100 corporate sector has migrated to AWS and Azure to the point where they are national security risk.

Fair point, it would be interesting to see a breakout reflected in earnings reports, but I doubt that would ever happen.

Re: “A solution in search of a problem” is a low-rates phenomenon

#50

Post by PaulHoule »

mym1990 wrote: post #43
ElevenLathe wrote: post #37

Earlier quoted context omitted.

An industry basically can't ever make a profit is not a solution to anything.

United Airlines making 10 billion a quarter doesn't sound like its in an industry that has no profit.

Profits seem to be sporadic. Some may be doing well right now because of unusual conditions but when competition returns and things get back to normal profits might disappear.
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