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How tech’s defiance of economic gravity came to an abrupt end

economist.com

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Re: How tech’s defiance of economic gravity came to an abrupt end

#91

Post by bee_rider »

cjbgkagh wrote: post #79
bee_rider wrote: post #77

Earlier quoted context omitted.

The US of course isn’t in a position to negotiate, since we aren’t actually in the conflict. We’ll just keep sending weapons to Ukraine so they have as strong a position as they can get. Ukraine is defending so… I dunno, I guess they aren’t very motivated to make concessions. I guess the starting point for negotiations for them would be Russia leaves, and then the details of where on the spectrum from “huge” to “mass…

The US is funding the Ukraine defense and has a enormous influence on negotiation. They are effectively a first party. If people don’t want to negotiate that’s their prerogative. I’m more interested in the difference between what I’m told by media and reality, and more precisely if there has been a softening of Russias stance I want to see where.

In order to negotiate, both parties need to be able to offer concessions. What concessions could Russia possibly offer the US, related to the Ukraine situation, that the US would be motivated to take? Our people aren’t dying and our territory isn’t threatened. Because we’re, as you pointed out, not paying the price for the conflict, we don’t have any incentive to try and stop it… we can’t negotiate in good faith because we don’t have any chips on the table.

We can influence the Ukraine/Russia negotiation of course, by increasing or decreasing our support for Ukraine. But, since they seem to be willing to continue fighting, decreasing aid would be a pretty huge betrayal.

Re: How tech’s defiance of economic gravity came to an abrupt end

#92

Post by Apocryphon »

Kye wrote: post #24
oldgradstudent wrote: post #21

Earlier quoted context omitted.

Hmm, how did I miss that?

I think those of us who lived through the 90s and 00s have a hard time counterdiscombobulating all the stuff that went down. People who experienced the 60s and 70s probably have similar difficulty.

Software ate the world. The years since the Dot-Com Bubble burst is like if the interstate highway system was built after the recession of the 1970s. The Factory Belt wouldn’t have become the Rust Belt if that had happened.

Re: How tech’s defiance of economic gravity came to an abrupt end

#93

Post by prottog »

spaceman_2020 wrote: post #59
willcipriano wrote: post #46

Earlier quoted context omitted.

Right after the election, we learned that the employment numbers turned out to be cooked ( https://www.cnbc.com/video/2022/12/22/philadelphia-fed-sugge... ) that was in large part the justification for the rate hikes, I think they end in the next few months and start to decline this year.

My belief is that the moment rates start going down, there's going to be another massive asset bubble which will create tremendous inflationary pressure. Historically, inflation has never come down so fast or so easily anywhere. So much of inflation is about belief and psychology. If a "good times are here again" belief takes hold, it's entirely possible that inflation will run amok, again.

> there's going to be another massive asset bubble which will create tremendous inflationary pressure

Asset bubbles don't necessarily turn out in cost-of-living inflation, as we saw in the era of QE after 2008; it was inflationary for asset values, which kept on climbing, but prices goods and services were stable, remaining under the 2% target rate in the decade between 2009 and 2019.

Re: How tech’s defiance of economic gravity came to an abrupt end

#94

Post by EGreg »

screye wrote: post #86

I believe the doom-n-gloom around all of tech is rather overblown. There are sectors of tech that will absolutely struggle. Gig-economy companies won't ever meet their valuation. Negative PE ratio startups are realizing that hyper-scaling is not as infinite as they believed, and that means their earnings might never catch up to their price. Social media companies are finally facing stiff non-American competition (Tik…

You forgot the biggest one.

Advertising revenue. That’s what Facebook and Google were supported by.

And it has been a zero sum game in a race to the bottom for years. They just didn’t diversify much, same as Russia or Venezuela with their oil economies.

Most companies built around zero-sum games are eventually going to stop growing as you run out of other people’s money. But that’s OK — they are already HUGE!

The real problem is the public stock market (also a zero-sum game, mostly) creating a bubble and pushing them to extract rents from their ecosystem harder and harder. It’s fine to raise money in order to grow, but investors end up reselling shares for more and more money and represent a class of people who extract rents from a multi sided market.

(By contrast, true utility tokens pegged to the dollar that can be sold to actual customers and are a way to raise money that is more economically sustainable and doesn’t create speculative bubbles.)

Re: How tech’s defiance of economic gravity came to an abrupt end

#95

Post by Apocryphon »

nugget wrote: post #90
scarface74 wrote: post #78

Earlier quoted context omitted.

Everyone says this narrative. But 10 years ago. - Google was the most popular search engine. Had a dominant position in adTech and YouTube was popular - Apple became the most valuable company in the US and the iPhone was sucking up most industry profits. - Amazon was by far the most dominant electric retailer and AWS was taking off (disclaimer: my current employer) - Microsoft had been the dominant operating system f…

Google acquired YouTube and Facebook acquired Instagram. Both for what seemed like insane valuations at the time. Both were brilliant defensive acquisitions in hindsight. Both fueled tech valuations by illustrating the opportunity for rapid disruption.

Wonder how it’d go if the DoJ actually practiced antitrust towards tech again. The EU Commission does, at least.

Re: How tech’s defiance of economic gravity came to an abrupt end

#96

Post by coffeebeqn »

ChuckNorris89 wrote: post #71
fosk wrote: post #18

Earlier quoted context omitted.

Contrarian signal, for the sake of having a conversation: - I think we will experience a massive deflationary bust. The inflation narrative is over, it’s all about a potential recession now. - By Summer 2023 we will experience YoY deflation and the Fed will cut then, or even sooner in anticipation to that. - We may see hikes pausing as soon as February, and cuts starting in the summer as a result of rapid disinflatio…

>Russia’s war with Ukraine will end (Putin is now agreeing to potentially think about negotiations) "Potentially think about negotiations" is a long long way from the war ending. Also Putin's terms are absurd. He wants to keep half of Ukraine while evading persecution for the crimes against humanity the Russian army caused against civilian population. That's not gonna fly in Kiev, who wants all their territories back…

Putin would want “peace” only to have more time to build up his army and continue the invasion in 2-5 years. It’s insane how naïve some people are still about russias intentions after everything they’ve done

Re: How tech’s defiance of economic gravity came to an abrupt end

#97

Post by api »

coffeebeqn wrote: post #96
ChuckNorris89 wrote: post #71

Earlier quoted context omitted.

>Russia’s war with Ukraine will end (Putin is now agreeing to potentially think about negotiations) "Potentially think about negotiations" is a long long way from the war ending. Also Putin's terms are absurd. He wants to keep half of Ukraine while evading persecution for the crimes against humanity the Russian army caused against civilian population. That's not gonna fly in Kiev, who wants all their territories back…

Putin would want “peace” only to have more time to build up his army and continue the invasion in 2-5 years. It’s insane how naïve some people are still about russias intentions after everything they’ve done

A decent chunk of the right isn’t naive. They want Putin to win because he’s a traditionalist and they love strong man rulers.

Re: How tech’s defiance of economic gravity came to an abrupt end

#98

Post by cjbgkagh »

bee_rider wrote: post #91
cjbgkagh wrote: post #79

Earlier quoted context omitted.

The US is funding the Ukraine defense and has a enormous influence on negotiation. They are effectively a first party. If people don’t want to negotiate that’s their prerogative. I’m more interested in the difference between what I’m told by media and reality, and more precisely if there has been a softening of Russias stance I want to see where.

In order to negotiate, both parties need to be able to offer concessions. What concessions could Russia possibly offer the US, related to the Ukraine situation, that the US would be motivated to take? Our people aren’t dying and our territory isn’t threatened. Because we’re, as you pointed out, not paying the price for the conflict, we don’t have any incentive to try and stop it… we can’t negotiate in good faith beca…

The US is spending a great deal of money, those are chips, and not having to spend money is a concession. Your framing of the situation makes little sense to me and appears to be angling towards the conclusion of unlimited support for Ukraine until their 'inevitable' victory. I'm less optimistic about Russia collapsing and also not optimistic about America's continued support for Ukraine, they wouldn't be the first country to be abandoned by the US. The aim is to give Russia a bloody nose and deny them an easy victory not for Ukraine win the war. "To be an enemy of America can be dangerous, but to be a friend is fatal.” - Henry Kissinger

Re: How tech’s defiance of economic gravity came to an abrupt end

#99

Post by scarface74 »

Apocryphon wrote: post #95
nugget wrote: post #90

Earlier quoted context omitted.

Google acquired YouTube and Facebook acquired Instagram. Both for what seemed like insane valuations at the time. Both were brilliant defensive acquisitions in hindsight. Both fueled tech valuations by illustrating the opportunity for rapid disruption.

Wonder how it’d go if the DoJ actually practiced antitrust towards tech again. The EU Commission does, at least.

Seeing that YouTube would have been sued out of existence, what difference would it make?

And how would a search engine company buying out a non profitable video platform that had no means of making money have triggered anti trust action?

Re: How tech’s defiance of economic gravity came to an abrupt end

#100

Post by perardi »

marssaxman wrote: post #68
Avicebron wrote: post #34

Earlier quoted context omitted.

Planes, trains, and automobiles are tech. Software is a specific subset, software is a subset of tolling and techniques that's applied to "tech" no more than circuit boards, wires, or the wheel. It doesn't have a special elevated status. The more people understand that the faster people will stop hero worshipping it.

> Planes, trains, and automobiles are tech. Reading and writing are "tech", if you insist on going down this pedantic road; but that's not what most people mean by that term in this context.

I’m gonna disagree just a bit here, because it loops back around to the possible end of the “tech” hype.

Cars have been tech in this finance and investment bubble. Tesla, obviously, but then lots and lots of electric vehicle and autonomous driving startups came in with the whole song and dance of “disrupting the incumbents” and “move fast and break things” and “let’s milk customers forever and ever with subscriptions for self-driving taxis as a service”.

Which is in the process of going poof. (Remember Nikola? No. Good.). Lots and lots of hype about startups and subscriptions, and we’ve ended up with GM having arguably the best autonomous driving tech, and Ford having arguably the most hyped recent EV with the F-150.

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