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How People Get Rich Now

paulgraham.com

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Re: How People Get Rich Now

#821

Post by TheButlerian »

WalterBright wrote: post #675
bumby wrote: post #669

Earlier quoted context omitted.

While you're not wrong, I think what you're missing is an important qualifier. Sometimes they are creating perceived value that doesn't materialize. Meaning the value is at least part speculation, rather than realized value. E.g., did Broadcast.com really create nearly $6B in value just because that's what it was speculatively valued at when purchased? I'd argue no, unless you think the "greater fool theory" is the c…

If you've got a superpower that enables you to determine the "real" value of something rather than its "perceived" value, you can use it to become the richest man in the world.

Walter, get cancer and die!

Re: How People Get Rich Now

#822

Post by random314 »

aerosmile wrote: post #719
random314 wrote: post #482

Earlier quoted context omitted.

While pg has extensive foot notes for this essay, there is a vast amount of research with orders of magnitude more citations contradicting him on the gini coefficient. There is no argument about his footnotes. Quite likely the very richest might not be inheriting it. This has no bearing on the gini coefficient. And his essay on wealth tax is downright stupid. Are his essays as meticulously researched as Pikketys? Why…

I appreciate this argument, except for one detail: > his essay on wealth tax is downright stupid What's everyone's deal with that essay? It literally has no subjective opinion stated anywhere - all it does is calculate how much percent of your wealth you're left with after 60 years of wealth tax [0]. You definitionally cannot push back on anything stated in that article, or otherwise your problem is not with PG's vie…

No billionaire is hiding his cash under a mattress. Investment assets typically compound at 4% above inflation with zero effort by the investor.

Pg completely ignores the zero effort compounding of wealth and pretends that the investors wealth will be "reduced" by 45% and that too over 60 years!

He forgets to state by how much the zero effort investors assets inflate exponentially in 60 years! If he thought he was making a case against wealth tax, he failed hard!

Also, its really silly of you to assume I don't understand algebra! I thought that pgs article was obviously ridiculous on its face. Clearly, it wasn't obvious to everyone.

Re: How People Get Rich Now

#823

Post by _5uxp »

mike00632 wrote: post #753
mmmmmbop wrote: post #611

Earlier quoted context omitted.

Genuinely curious: Do you have any more background on this? Who are these rich people that are not listed in Forbes?

This is an ongoing curiosity of mine. One really cool example is Mubarak of Egypt who became wealthy from corruption. When he lost power he had some wealth exposed and he was richer than any known person in the world. https://www.forbes.com/sites/clareoconnor/2011/04/11/egyptia... It's very likely that the richest person in the world right now is Vladimir Putin.

Royal families and dictators are big secret. There is an ongoing mystery about lose of a $128B (yes billion!) in my countries (Turkey) CB budget which they don't talk or give any clue and it's just a recent thing. Imagine beyond this, offshore accounts and freeports.

Re: How People Get Rich Now

#824

Post by danielmarkbruce »

benzor wrote: post #488
heylook wrote: post #458

Earlier quoted context omitted.

> - Large unicorn startups that are perpetual money losers continue to operate only because they are effectively subsidized by regular capital raises. Look no further than all the Silicon Valley darlings such as Uber, Netflix, AirBnb, Tesla, and so on. All of them would cease to exist without continued capital injection from secondary share offerings or VC raises You should look up the financial statements of the com…

Apologies for some hastily chosen examples. I think the point still stands if you consider the following companies: WeWork, Lyft, Snapchat, Pinterest, Dropbox, Slack, Casper, Lime, Peloton, Beyond Meat, Wayfair, Zillow. More generally speaking, take a look at Goldman Sachs' Non-Profitable Technology Index: https://pbs.twimg.com/media/EsRVCiMXIAE7xlA.png

Would you have put Google and Facebook in this group when they weren't profitable? You are missing something - many companies have great long term economics even if they are losing money right now. Slack (if still independent) could easily be profitable - they just have to spend less growth (ie, largely they could cut their sales and marketing dramatically, along with other items). Snapchat the same, Pinterest the same. Some of the others I believe you might by and large correct. The general statement that lots of companies are giving away dollar bills for $0.80 isn't right.

Re: How People Get Rich Now

#825

Post by chrisbrandow »

He doesn’t address another possibility. That the inherited wealth, as evidenced by DuPont heirs, was carried over from earlier era that lacked the progressive taxation structure of the 50s and 60s that may have prevented accumulation of wealth. That was largely dismantled in the 80’s and 90’.

Re: How People Get Rich Now

#826

Post by 1_player »

technotony wrote: post #767
Balgair wrote: post #506

Earlier quoted context omitted.

Are the fake-meat companies tech companies? I thought they are more like contract manufacturers, brewers, or other industrial foodstuffs. No doubts on the access to cheap debt, though.

There's a ton of tech behind Beyond Meat. Their core science is based on research from an RNA professor at Stanford. That proteomics research is the reason their burger tastes so much better than previous generation veggie burgers.

Tech company means they deal with software. Beyond Meat isn't a tech company.

Or is pharma part of tech in your definition? What about NASA?

Re: How People Get Rich Now

#827

Post by quickthrower2 »

mmmmmbop wrote: post #611
qzw wrote: post #464

I'm rather disappointed PG would think that the Forbes wealth list could support any kind of conclusion whatsoever. One of the biggest reasons that the top of the list is filled with tech billionaires is that their wealth is relatively transparent, being mostly in the form of stock holdings in publicly traded companies and often directly disclosed. This makes it much easier for Forbes to estimate their net worth with…

Genuinely curious: Do you have any more background on this? Who are these rich people that are not listed in Forbes?

Cryptocurrencies have created many paper-rich people who wont be on the list. Just 10k bitcoin would make you very rich these days, and there must be a few low-profile geeks with that may coins on a HDD.

Also anyone rich, non-domiciled and "avoiding tax" will presumably not be on the list.

Re: How People Get Rich Now

#828

Post by [deleted] »

random314 wrote: post #482
aerosmile wrote: post #444

Earlier quoted context omitted.

You liked his idea that for a startup to scale, you should be doing things that don't scale. That article has mostly anecdotal evidence, and yet nobody ever pushed back on it. How do we know PG was right back then? (He was.) A few years later, that same guy writes an extensive essay with footnotes and data that must have taken days to compile (going all the way back to 1892). And yet, this one rubs you the wrong way.…

While pg has extensive foot notes for this essay, there is a vast amount of research with orders of magnitude more citations contradicting him on the gini coefficient. There is no argument about his footnotes. Quite likely the very richest might not be inheriting it. This has no bearing on the gini coefficient. And his essay on wealth tax is downright stupid. Are his essays as meticulously researched as Pikketys? Why…

[deleted]

Re: How People Get Rich Now

#829

Post by random314 »

aerosmile wrote: post #719
random314 wrote: post #482

Earlier quoted context omitted.

While pg has extensive foot notes for this essay, there is a vast amount of research with orders of magnitude more citations contradicting him on the gini coefficient. There is no argument about his footnotes. Quite likely the very richest might not be inheriting it. This has no bearing on the gini coefficient. And his essay on wealth tax is downright stupid. Are his essays as meticulously researched as Pikketys? Why…

I appreciate this argument, except for one detail: > his essay on wealth tax is downright stupid What's everyone's deal with that essay? It literally has no subjective opinion stated anywhere - all it does is calculate how much percent of your wealth you're left with after 60 years of wealth tax [0]. You definitionally cannot push back on anything stated in that article, or otherwise your problem is not with PG's vie…

The book's central thesis is that when the rate of return on capital (r) is greater than the rate of economic growth (g) over the long term, the result is concentration of wealth, and this unequal distribution of wealth causes social and economic instability. Piketty proposes a global system of progressive wealth taxes to help reduce inequality and avoid the vast majority of wealth coming under the control of a tiny minority.

PGs attack on the wealth tax is how much a zero effort investor could lose in 60 years. 45% in one case. 40hr per week income tax rates are very often higher than that. PGs paen to the idle rich is absolutely ridiculous. Some one who works hard like Musk will be barely affected by such a tax. It only mildly hurts the idle rich.

Re: How People Get Rich Now

#830

Post by ezconnect »

mmmmmbop wrote: post #611
qzw wrote: post #464

I'm rather disappointed PG would think that the Forbes wealth list could support any kind of conclusion whatsoever. One of the biggest reasons that the top of the list is filled with tech billionaires is that their wealth is relatively transparent, being mostly in the form of stock holdings in publicly traded companies and often directly disclosed. This makes it much easier for Forbes to estimate their net worth with…

Genuinely curious: Do you have any more background on this? Who are these rich people that are not listed in Forbes?

Lots of German billionaires don't want to be listed on it except I think a guy who flaunts it because it his brand to be rich.
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