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Tech bubbles are bursting all over the place

economist.com

611–620 of 774 posts

Re: Tech bubbles are bursting all over the place

#611

Earlier quoted context omitted.

Stock buybacks aren’t spending money any more than putting it in your retirement fund is. They are value neutral.

They aren't value neutral if you are spending money on buybacks instead of growing / keeping your factories in working order. See Abbott Labs spending 5 billion on buybacks instead of keeping their infant formula factories up to code.

It shouldn't have stopped them from maintenance though; they just didn't feel like doing maintenance. If a company wants to spend money on something they can always get a loan for it and consider issuing the shares out again later if needed.

The problem with a share buyback is if you do it and then the share price falls again.

Re: Tech bubbles are bursting all over the place

#612
post #565

Earlier quoted context omitted.

Most people don't get to choose, in my case, it's our corporate IM system, so I have to use it whether I want to or not. It's got a lot of enterprise features that companies like, like SSO integration, message retention policies, security certifications like HIPAA and FedRAMP, and more. There are also a lot of pre-made apps for integrating with corporate apps like Jira, Gmail, Salesforce, etc. It's fine, I haven't lo…

> Most people don't get to choose Is that a case of business people making technical decisions? That I understand. Do not like, but I understand

There was some technical evaluation done, but some features like retention policies and SSO were deemed requirements. Not sure what all of the criteria were or what all of the candidates were, it was a while ago.

Re: Tech bubbles are bursting all over the place

#613
post #125

Earlier quoted context omitted.

Yes, you need some level of financial creativity to justify buying into one of the many bubbles. But that's where the timeless Buffett quote[0] on Ted Williams and batting comes in, there's no called strikes in securities markets. Mr. Market doesn't force you to do anything at all, we're all free to ignore the speculation and focus on proper cash flowing businesses at reasonable valuations. The more boring the better…

Sitting in cash is not a defensive position, it's offensive and a highly risky one at that. When fiat, is losing 5-6% on average every single year, you can't afford to wait for the right moment to jump into equities. You have to be in it now, whether the valuation suits you or not. This of course exacerbates risk for everyone and forces everyone into risky positions because cash is now more risky than nearly all the…

I'm not sure where you bringing "sitting in cash" from.

Re: Tech bubbles are bursting all over the place

#614
post #173

Earlier quoted context omitted.

Governments as a whole have a lot of different hammers for monetary policy. It's just that every other one depends on the Congress understanding the problem and cooperating.

Central banks are not governmental organizations.

It sounds pedantic, but it very much depends on how you define 'government'.

Re: Tech bubbles are bursting all over the place

#615
post #16

Earlier quoted context omitted.

the fact that you stopped to ask those questions makes me think that you're at minimum, an above average developer. caring about the business and its fundamentals is important beyond just slinging code.

Interestingly, I've heard many instances where interviewees asked startups about their revenues and the startups just wouldn't tell them, saying that it's growing, or some other vague nonsense. Even in the case of inquiring about the amount of equity one gets, many startups would not tell them the actual percentage of the company they'd get, instead opting to tell them the number of shares, without actually telling t…

Experienced basically this while working for a startup. Equity turned into shares, which turned into "incentive points" that could be revoked at any moment and for any reason and were otherwise worthless. Same deal, 15k "incentive points" out of some unknown number. We pressured them on that for a while, because it was completely unacceptable for the amount of work we'd done for them, but then the entire dev team left.

Re: Tech bubbles are bursting all over the place

#616

Earlier quoted context omitted.

The first time Netflix stock ate shit, so in January.

Why Netflix? I stopped my Netflix to use Amazon Video. Bad for Netflix but still good for streaming and tech.

It was just something exacerbated the feeling I had at the time that the market was turning downwards. Not anything to do with Netflix necessarily, there were other tech stocks turning downwards at the same time. But that first big Netflix drop had a different feeling to it.

Not to mention, the insane stock price gains in tech in general had all but stopped, NFT scams were at there height, and it just looked like things were going south to me. Turned out my feeling was right.

Re: Tech bubbles are bursting all over the place

#617

Earlier quoted context omitted.

> All-cash is basically the new norm. It’s paradoxical that all-cash became the norm in a period where mortgage rates were at all time lows…

> It’s paradoxical that all-cash became the norm in a period where mortgage rates were at all time lows… Cash transactions have less friction and chance of falling through, so it makes sense that sellers prefer cash purchases. Consequently, you see cash offers because buyers know that sellers prefer - you essentially jump to the front of the line.

And just to make the connection explicit: if lots of buyers are making competitive offers because rates are low and money is cheap, then that's going to encourage the people who can afford to pay cash to make an all-cash offer where otherwise they might not have.

Re: Tech bubbles are bursting all over the place

#618

Earlier quoted context omitted.

The central bank doesn't control policies like that though. They have scant few actual knobs to turn on their own without Congressional intervention.

On the other hand, The Fed goes over the top with what they can do and Congress refuses to lean in on its supervision of The Fed. Imagine that. You refuse to do your job and you still have a job. Only in America.

Dear Down-voter

Congress has the power to monitor and "regulate" The Fed. That is, The Fed is not - or isn't supposed to be - completely autonomous. It has oversight, or should.

The reality is, it does not. Congress lets The Fed run wild. That might be the status quo, but it's not how it legally needs to be.

So yes, Congress isn't doing their job. And no one (read: the media) is questioning that negligence.

Again, only in America. << That's not editorial. It's a statement of fact.

Re: Tech bubbles are bursting all over the place

#619

Earlier quoted context omitted.

They mean paying in full themselves, not backed by mortgage.

Even if you get the mortgage, it's the same as cash to the seller. The bank just cut's them a check right away. The mortgage is between the bank and the buyer.

Banks pre approve liberally but commit to funding with great deliberation. It isn’t the same thing because banks can make all sorts of deals fail.

Re: Tech bubbles are bursting all over the place

#620

Earlier quoted context omitted.

I've opened Tesla's doors, enjoyed the suspension of the Tesla finding it comfortable, and when I adjusted my mirrors I used buttons on the steering wheel. Usually I don't have to adjust the mirrors, because the car can automatically detect that it is me who is driving and it has memorized my mirror preferences. Why are you lying? Why not focus on the metrics? For example... Storage space. The Tesla? It has four time…

“Lying” is a bit emotive, suggests you might be a bit too invested here to get the argument the GP was making. Look, Tesla got early success in EVs by being considerably better where everyone else was weak (drivetrain, battery, software, charging network). That doesn’t mean it’s not weak where they are strong (QC, basic manfacturing competencies like panel gaps, dealer network, interaction switchgear refined over gen…

> “Lying” is a bit emotive, suggests you might be a bit too invested here to get the argument the GP was making.

Emotion doesn't come into it. You built an argument upon a poor foundation. In strictly logical terms even if your argument structure was correct your argument would be invalid because its premises aren't correct.

You said several things that are objectively false. I know them to be false because I have first hand experience which shows me that they are false. Moreover, considering that Tesla has an industry leading satisfaction score, I know that my experience is not uncommon. What is uncommon, even vanishingly rare, is the veracity of the statements which you used when building the case against Tesla.

Perhaps I sound emotive because I referred to what you did as lying. The principle of charity isn't leaving me much room for you, because you are either wrong and informed or wrong and uninformed. You can take your pick, but whichever you choose don't cheapen the debate by appealing to me as being emotional.

> Look, Tesla got early success in EVs by being considerably better where everyone else was weak (drivetrain, battery, software, charging network). That doesn’t mean it’s not weak where they are strong (QC, basic manfacturing competencies like panel gaps, dealer network, interaction switchgear refined over generations).

This is a very different argument than the idea that it is a no brainer to go with Mercedes. You are moving the goal posts. It is a stronger argument too. Unfortunately, you don't support it well. For example, the argument for the dealer network being an advantage rather than a liability seems doubtful to me. Years back during the era Tesla was rising there were other EVs. Dealerships recognized that recurring revenue from maintenance wasn't as high for these vehicles. They intentionally sabotaged sales of EV vehicles, following perverse incentives, by doing things like giving test rides on vehicles which hadn't been charged and then using the resulting failure to persuade to other purchases. This is a liability, I think, but existing laws tend to protect dealerships as a model at the expense of car companies. So it isn't something that Mercedes and other car manufacturers can easily circumvent. Worse is that the experience at a dealership is much much worse than ordering things over the internet. Tesla just drives the car to your door after you order it. Dealerships expect someone else to drive you there and to go through high pressure sales channels. Tesla can pursue a three click and order model, but dealerships would be furious and go after automakers legally if they were cut out of the loop.

> Regardless, what matters is there are people who feel about Mercedes the way you clearly feel about Tesla.

Again, you are making a very different argument. We started with average Jane not devoted Mercedes fan. Trying to strawman my position by switching from average Jane to devoted Mercedes fan is not at all in keeping with the principle of charity. It also does a disservice to the OP you try to represent, because it contradicts their post, yet you act like you are speaking for them.

> GP is betting there’s a huge market for “car like I always knew it from a manufacturer I love except with a battery” and I’ll bet they’re right.

Which is reasonable, which lets you convince yourself you are right, but average Jane would rather pay $100k for four times as much space or save $50,000 to $80,000 and /still get more space and better range. And she might even like the Tesla aesthetic more than Mercedes: it is Tesla, after all, that has the majority of the EV market. Presumably if their aesthetic was strictly inferior to alternatives that wouldn't be the case. Regardless it doesn't really matter - taste is by its very nature subjective. It is the heart of qualia, not a criteria we can evaluate on behalf of others without knowing their preference set.

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