Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Tech bubbles are bursting all over the place

economist.com

Post reply on HN
Print view View original

211–220 of 774 posts

Re: Tech bubbles are bursting all over the place

#211

Post by bradfa »

martindbp wrote: post #179
legitster wrote: post #75

This has been a long time coming. Back in the day, there was an inherent understanding that a stock price is supposed to reflect "the fundamentals" - present value of the company + future earnings. And of course there was some amount of speculation around future earnings, but for the most part companies at least tried to be profitable. But if you look at the share price of like, Tesla - it's completely insane. There…

Tesla made more money last quarter than Ford, GM and Toyota. Toyota made 10x the number of cars as Tesla. Tesla is growing vehicle production 50% YoY, while growing profit even faster (having barely hit economies of scale yet). Tesla has a backlog of orders approaching a year in many regions. Everyone else is losing money on their EVs and can't make them in volume production, can't find the batteries for them, becaus…

Looking at a single quarter is not a great way to compare large companies. Even looking at just a single year is not a great way, but for comparison, in 2021 Tesla had revenue of $54 billion and net income of $5.5 billion. In 2021 Ford had revenue of $136 billion and net income of $17.9 billion. Toyota had similar net income as Ford in 2021.

Yes, in the most recently reported quarter Ford lost money. And in previous years Ford has also lost money. But so has Tesla.

Looking at Tesla as a traditional automaker is not fair to Tesla. They don't want to be a traditional automaker, I get the impression they want to be more like General Electric was back 50-100 years ago, making all kinds of things and being rather innovative.

Re: Tech bubbles are bursting all over the place

#213

Post by blagie »

ditonal wrote: post #146
blagie wrote: post #112

Earlier quoted context omitted.

It's a huge red flag, and it's a hugely common red flag. A startup was peeved I valued their equity at zero when they wouldn't share. I got strong hints my equity was worth at least $100k in extra annual salary, but they wouldn't budge on disclosing anything I could hold them accountable to. I think they were being honest, but I didn't take the job. I did take a previous job like that, and when the company sold, we w…

The reason for the opacity is obvious, they want you to think the equity is worth more than it is. People constantly assume good faith in these things when they shouldn’t. Obviously number of outstanding shares is a bare minimum, but things like cash reserves and cash flow should also be shared but they don’t want to share that information, often times because it’s not good, they just wasn’t people who believe in the…

That's the thing, though. It's not always a scam. You never know whether you're being scammed. I /didn't/ get scammed, but everyone working at my first company out of school thought we /would/ get scammed. We've all seen a lot of people get scammed.

Re: Tech bubbles are bursting all over the place

#214

Post by scarface74 »

avgDev wrote: post #2

I work for non-tech generating 100million+ in revenue. Cushy job, fully remote, good pay and full autonomy with flexible hours working as an IC. I recently talked to a startup, similar pay, culture would be a better fit since it was mostly techies and I'm a nerd by nature.....but things just got awkward as soon as I asked about their revenue....they were bleeding money and I was told they were being acquired by a big…

There are a lot of companies with “100 million in revenue” and no profit…

Mentioning revenue and not profit is not informative.

Re: Tech bubbles are bursting all over the place

#215

Post by akira2501 »

izzydata wrote: post #118
legitster wrote: post #75

This has been a long time coming. Back in the day, there was an inherent understanding that a stock price is supposed to reflect "the fundamentals" - present value of the company + future earnings. And of course there was some amount of speculation around future earnings, but for the most part companies at least tried to be profitable. But if you look at the share price of like, Tesla - it's completely insane. There…

Over a long enough time frame the stock market and even the whole economy behaves like a pyramid scheme as it is dependent on new generations to be more people than the previous one.

That really only seems to be true when you allow unchecked mergers and acquisitions, because once you've eliminated competition continuing to grow the market through innovation is almost impossible.

I'm not convinced this is some natural "tech" bubble. This feels like an M&A bubble to me.

Re: Tech bubbles are bursting all over the place

#216

Post by Bubble_Pop_22 »

Despite my handle I'd wager that it all comes down to a very risk averse society as shown by pretty much every metric ranging from low birth rate to drinking to smoking to drug usage etc.

Back in the days when interest rates went down, people started new businesses or expanded those they already owned at a huge pace. I mean the population as a whole not the businesses in the S&P500.

When the Fed rolled rates to zero and did QE post 2008 and super QE in 2020-2021 the population just invested in the stock and housing market. No initiative just buying "proven assets" .

Investing in the stock market with a financial advisor essentially buying the S&P or some other mutual fund..that's way less risky than starting your own business.

Now the Fed is raising rates and people (and financial advisors) aren't even sure about stocks anymore, they are selling in droves and go straight to US bonds which are even more risk averse (it's essentially the stuff that Insurance companies are required to hold by law to secure their premiums because the risk of default of US Federal govt is essentially zero)

Of course there is crypto that is a casino, still it could be argued that investing in an asset with a marketcap of 1T dollar however new and unproven is still more risk averse than starting your own business.

Re: Tech bubbles are bursting all over the place

#217

Post by martindbp »

legitster wrote: post #205
martindbp wrote: post #179

Earlier quoted context omitted.

Tesla made more money last quarter than Ford, GM and Toyota. Toyota made 10x the number of cars as Tesla. Tesla is growing vehicle production 50% YoY, while growing profit even faster (having barely hit economies of scale yet). Tesla has a backlog of orders approaching a year in many regions. Everyone else is losing money on their EVs and can't make them in volume production, can't find the batteries for them, becaus…

I'm not sure where you are getting those numbers from. Ford had $37b in revenue Q4. Tesla had $16b. Tesla is an impressive company that's managed to finally be profitable. But currently their market cap is higher than all other auto manufacturers combined. > Everyone else is losing money on their EVs and can't make them in volume production, can't find the batteries for them, you do the math. That's the thing, this s…

Earnings, not revenue

Re: Tech bubbles are bursting all over the place

#218

Post by otterley »

s1artibartfast wrote: post #207
otterley wrote: post #187

Earlier quoted context omitted.

I think the appraiser is doing you a favor by not appraising it for the contract price in this case. Why would you want to overpay for a house and have to cover the financing shortfall yourself? Especially in a market that traditionally has slow RE price appreciation. Let the cash buyers suffer the losses. You'll thank yourself later.

You're assuming that the deal doesn't go through if it doesn't appraise. In my market nearly all winning offers have waived the appraisal contingency

Not assuming that at all. I'm saying that if the appraisal doesn't go through, then the lender won't cover the remainder of the purchase price, and then the buyer will have to make up the difference out of his/her own pocket. At that point, I'd bail, because the appraiser is raising a red flag.

But since you mention it, in the slower market being discussed here, I would definitely not waive an appraisal contingency.

Re: Tech bubbles are bursting all over the place

#219

Post by gtowey »

vkou wrote: post #177
monktastic1 wrote: post #120

Earlier quoted context omitted.

It bears repeating that there is no "what the house is worth" in the abstract. If you somehow know that other bidders will pay at most $X for it, then of course you'd never bid $X * 1.2 -- you'd bid $(X+1). And if lots of people are (or can be made) emotionally attached to a house and pay an apparently unreasonable amount, that is what it's "worth."

> It bears repeating that there is no "what the house is worth" in the abstract. No, but there is a 'what was selling price for similar homes in this area' price in nearly every specific. Listing prices are intentially set to be much lower than selling prices. Selling prices are the real prices, listing prices are fiction. People paying 20% over listing usually means that listing was 20% under selling. Boring! And no…

> Listing prices are intentially set to be much lower than selling prices. Selling prices are the real prices, listing prices are fiction

I feel like this is only true in irrational housing markets, or at least those that have a chronic undersupply of housing .

In my local non-insane market I went through two different purchases where I successfully bid less than asking.

That's gone since the pandemic though since everyone tried to move out of cities and work remote in my town.

Re: Tech bubbles are bursting all over the place

#220

Post by lamontcg »

olivermarks wrote: post #26

The problem I have with the Economist these days - they've changed a lot recently as has the Financial Times - is that they are one of the big cheerleaders for creating bubbles out of tech they clearly don't understand. This starves the startups that have compelling and reachable business models and goals because the funding goes to (quite possibly financially scammy) moonshots with vague goals somewhere over the hor…

> The sooner we get back to a 'Web 2.0' era like 2008> on the sooner genuine innovation will be funded again.

I'd argue it broke in the 90s and we need to go back much further.

Post reply on HN