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

301–310 of 774 posts

Re: Tech bubbles are bursting all over the place

#301

Post by jstarfish »

prohobo wrote: post #21

People said this was the "best time ever to get funding" for a startup. I disagree. In my view, it was the best time ever if you played a particular game and had the right connections. I pitched an idea to a VC, which I had a prototype for, looking for $100k. He liked it but wouldn't fund because I didn't have a solid business plan. Fair enough, I need to find a business partner. But then he told me something about h…

I hate SV culture, so not one to WK or make excuses for it, but when you have as much money to throw around as he does, you don't have time to deal with requests for pocket change.

Look at your own investment portfolio. Are you investing $1 at a time in fractional shares of a million different stocks, or investing $1000 at a time on a smaller number of stocks/funds you expect to have solid returns? (You think his crypto bids are misguided. Maybe you're right. Not your money though.)

If you're certain about your product, you don't need an investor. You need a small business loan.

Re: Tech bubbles are bursting all over the place

#302

Post by abathur »

Robotbeat wrote: post #202
kurthr wrote: post #196

Earlier quoted context omitted.

That is "the market" working for you! We could allocate resources to productive assets by fiscal spending, but that is prevented by politics. Only when "the market" gets its cut can any infrastructure be built in the US. That's also true for much of the medical establishment and pension/retirement systems. If the market was efficient, we wouldn't be complaining about it. Unfortunately, a "free market" and an efficien…

What sucks is that fiscal policy, ie government spending, is also often not very efficient. Even when rampant corruption doesn’t destroy efficiency, crushing bureaucracy or just plain incompetence will. (Is the DMV a model of efficiency?) So you need a smart balance. And you need competent, honest people in both business AND government. I don’t think that government necessarily is inefficient. The DMV could be a very…

I think bureaucracies do tend to suck, but I also think there are often people who stand to gain from making a bureaucracy suck.

For that reason, I suspect it's good idea to leave interpretive space for the possibility that a given bureaucracy has been intentionally hamstrung, or is Kafkaesque by design.

I suspect calling Comcast is miserable because the process is designed to exhaust and manipulate you out of quitting, for example.

I suspect it's possible to build systems that enable you to ensure an ER visit will cost $500 instead of $10000--but our insurance companies may feel like the uncertainty deters people from seeking care.

Re: Tech bubbles are bursting all over the place

#303

Post by cwilkes »

vkou wrote: post #78
lumost wrote: post #7

Earlier quoted context omitted.

Across every investment class there has been a trend of buyers needing to become more financially irresponsible in order to participate in the market. Need to buy a house? bid 20% more than asking, if you don't - someone else will.. in cash. Need to build a ride-hailing app? prepare to pay people to ride indefinitely. Need to own a growth stock? prepare to pay upwards of 100x multiple on revenue. All around, there ha…

It's not irresponsible to bid 20% over asking. Asking is deliberately underpriced, because it is excellent advertising in a hot RE market. It's irresponsible to bid 20% over what the house is worth (which has nothing to do with asking price), just because you got emotionally attached to the house, and started a bidding war with another person emotionally attached to the house.

No broker in their right mind is deliberately underpricing the homes they represent. Why would they? A homeowner talks to another broker and they say they can get 20% more than the first one. Who is the seller going to go with?

When we sold our house the broker put it at a fair price. Then along came a couple that’s been outbid a number of times and offered 30% over within 24 hours of listing.

Was the home underpriced? Maybe, but the housing market is such that it doesn’t have to appeal to hundreds of people. Just one.

Looking at the people going through the home most of them were using flyhomes.com (they operate as sort of a “we will pay cash for the house and then you pay us back”) and probably had no intention of living there.

Re: Tech bubbles are bursting all over the place

#304

Post by scollet »

vineyardmike wrote: post #264
scollet wrote: post #184

Earlier quoted context omitted.

Shouldn't you do this in a bull?

You always do it so you don’t have to question the timing. If you do it during a bill, you’re waiting until the price is going up. Doing it during a bear gets you when the price is going down. Buy low sell high and all that jazz.

I should have included "also".

Re: Tech bubbles are bursting all over the place

#305

Post by fullshark »

seydor wrote: post #151

As always, when things crash it's the best time to read the comments

Something that's funny right now is there are a lot of bears gloating about what they think is going to happen in the market and cryptocurrencies the next 2 years without it even having happened yet. They've been waiting literally years for this moment and they think it's finally arrived and can't wait to dance.

Re: Tech bubbles are bursting all over the place

#306

Post by MomoXenosaga »

colechristensen wrote: post #138
lumost wrote: post #7

Earlier quoted context omitted.

Across every investment class there has been a trend of buyers needing to become more financially irresponsible in order to participate in the market. Need to buy a house? bid 20% more than asking, if you don't - someone else will.. in cash. Need to build a ride-hailing app? prepare to pay people to ride indefinitely. Need to own a growth stock? prepare to pay upwards of 100x multiple on revenue. All around, there ha…

This was driven by extended 0-ish% interest for an entire recession cycle. Unable to get "safe" returns, money chased more dangerous classes of assets and inflated prices. Inflation and a return to nonzero interest means capital gets to retreat to safer ground, pulling the rug out of stupid unprofitable startups that can only make money with head-in-the-clouds IPO valuation or FAANG acquisition.

Is it really a bad thing? Unemployment is pretty low.

Re: Tech bubbles are bursting all over the place

#307

Post by WalterBright »

arminiusreturns wrote: post #263
WalterBright wrote: post #210

Earlier quoted context omitted.

The Federal Reserve banks are.

No they are not, though it's easy to understand the confusion. From the SF Feds website: The Board of Governors—Located in Washington, D.C., Board members are appointed by the U.S. President and confirmed by the U.S. Senate. Board members and staff are civil service employees. The 12 regional Reserve Banks—Located around the country, the 12 Federal Reserve Banks are chartered as private corporations. Employees are no…

Yes, I'm aware of the legal fiction that they are not part of the government. But they are, as they are run by people appointed by the government, and therefore serve the government.

Re: Tech bubbles are bursting all over the place

#308

Post by dominotw »

gonzo41 wrote: post #92
lumost wrote: post #7

Earlier quoted context omitted.

Across every investment class there has been a trend of buyers needing to become more financially irresponsible in order to participate in the market. Need to buy a house? bid 20% more than asking, if you don't - someone else will.. in cash. Need to build a ride-hailing app? prepare to pay people to ride indefinitely. Need to own a growth stock? prepare to pay upwards of 100x multiple on revenue. All around, there ha…

This is also a central banking fail in so far that there's that much liquidity in the market that can't find a productive outlet. There's a lot of money, but also not enough concentrated in one spot to do really useful ventures like large infrastructure projects. So instead the money is distorting everything. Imagine if lending was less cheap for home owners but it was still cheap for governments or really large comp…

why is the housing market not budging. Its just lagging other assets?

Re: Tech bubbles are bursting all over the place

#309

Post by corrral »

otterley wrote: post #218
s1artibartfast wrote: post #207

Earlier quoted context omitted.

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.

> At that point, I'd bail, because the appraiser is raising a red flag.

The point is, in a lot of markets, if you bailed on offers over this in the last couple years, you wouldn't be winning any bids in the first place, and wouldn't have been able to buy a house at all. The winning bids include guarantees that the buyer will cover the difference. If you won't do that, you'll lose to an all-cash offer from someone who will. If you're lucky, you won't be competing against superior offers that also waive all contingencies.

I have no idea where all these people are coming from with hundreds of thousands in cash and the ability to cover several thousand more on top of the appraisal value, but they seem to be involved in damn near every sale the last 2ish years. Given how many are OK waiving inspections and such, I have to assume they're institutional buyers who can spread that risk around, not individuals who could be ruined by that kind of thing.

Post reply on HN