4 ms·

I doubt that a recession is looming, because the fear is fanned by perceived periodicity, while the economy solidly expands mostly on the back of the software i

I doubt that a recession is looming, because the fear is fanned by perceived periodicity, while the economy solidly expands mostly on the back of the software industry's expansion. The market will ride that software expansion for some time. There is no iron law of a ten year recession period.

new_realist 7y ago
Software is 2% of US GDP.
- dehrmann 7y ago
  I think they meant a more vague definition software. Amazon isn't really a software company, but it used it to change distribution and squeeze inefficiencies out of the system. Same with Google and advertising. No one really knows what the ROI for a TV spot is, but every Adwords bidder knows their keywords' ROI, and if Adwords claimed TV dollars, that squeezed out inefficiency.
  - futureastronaut 7y ago
    Yes, and we see this in disproportionate demand for software developers, and also in envy/resentment towards tech workers, who have benefitted the most in the recovery.
  - new_realist 7y ago
    Sure, but this didn’t prevent recessions in 2001 and 2007; in fact, efficiency improvements have been occurring since the dawn of civilization. It’s not a lack of efficiency that causes recessions, it is over-expansion mediated by greed.
- bumby 7y ago
  I don't know the intent, but I read the original comment as software's enabling function as well. So the direct sales of software may only be 2%, but I'd be curious if there's any data on the ancillary effects of software on GDP (like increased productivity through automation, increased business efficiency etc.)
  - new_realist 7y ago
    Before software there was Jan an, operations management, industrial engineering, interchangeable parts, division of labor, agriculture... all the way back to math, etc. Software is just how modern day improvements are expressed.
    - bumby 7y ago
      I understand your point, but I think they can/do build upon one another. Agriculture is more productive than gathering, oxen are more productive than human farm labor, tractors moreso than oxen, and GPS controlled combines more than a tractor. But im not sure if we've quantified how much productivity is directly attributable to software
dehrmann 7y ago
> the economy solidly expands mostly on the back of the software industry's expansion Any references for this? It's also pretty easy to argue that US domestic oil production is driving the economy, at least if you just look at growth. It's producing almost twice as much oil as 10 years ago.
- futureastronaut 7y ago
  I thought it was common knowledge that the recovery from the 2008 recession is largely driven by growth of tech stocks, especially Google, Apple, Amazon, and Facebook. https://www.bloomberg.com/news/articles/2019-05-03/if-this-is-a-tech-bubble-in-stocks-it-s-the-expansionary-phase https://www.bloomberg.com/news/articles/2019-05-03/if-this-i... https://www.reuters.com/article/us-usa-stocks-weekahead/halfway-through-2019-tech-leads-on-wall-street-idUSKCN1TT2R7 https://www.reuters.com/article/us-usa-stocks-weekahead/half...
c3534l 7y ago
There's an old saying "economists have correctly predicted 9 out of the last 3 recessions."

new_realist 7y ago

Software is 2% of US GDP.

dehrmann 7y ago
I think they meant a more vague definition software. Amazon isn't really a software company, but it used it to change distribution and squeeze inefficiencies out of the system. Same with Google and advertising. No one really knows what the ROI for a TV spot is, but every Adwords bidder knows their keywords' ROI, and if Adwords claimed TV dollars, that squeezed out inefficiency.
- futureastronaut 7y ago
  Yes, and we see this in disproportionate demand for software developers, and also in envy/resentment towards tech workers, who have benefitted the most in the recovery.
- new_realist 7y ago
  Sure, but this didn’t prevent recessions in 2001 and 2007; in fact, efficiency improvements have been occurring since the dawn of civilization. It’s not a lack of efficiency that causes recessions, it is over-expansion mediated by greed.
bumby 7y ago
I don't know the intent, but I read the original comment as software's enabling function as well. So the direct sales of software may only be 2%, but I'd be curious if there's any data on the ancillary effects of software on GDP (like increased productivity through automation, increased business efficiency etc.)
- new_realist 7y ago
  Before software there was Jan an, operations management, industrial engineering, interchangeable parts, division of labor, agriculture... all the way back to math, etc. Software is just how modern day improvements are expressed.
  - bumby 7y ago
    I understand your point, but I think they can/do build upon one another. Agriculture is more productive than gathering, oxen are more productive than human farm labor, tractors moreso than oxen, and GPS controlled combines more than a tractor. But im not sure if we've quantified how much productivity is directly attributable to software

dehrmann 7y ago

> the economy solidly expands mostly on the back of the software industry's expansion Any references for this? It's also pretty easy to argue that US domestic oil production is driving the economy, at least if you just look at growth. It's producing almost twice as much oil as 10 years ago.

futureastronaut 7y ago
I thought it was common knowledge that the recovery from the 2008 recession is largely driven by growth of tech stocks, especially Google, Apple, Amazon, and Facebook. https://www.bloomberg.com/news/articles/2019-05-03/if-this-is-a-tech-bubble-in-stocks-it-s-the-expansionary-phase https://www.bloomberg.com/news/articles/2019-05-03/if-this-i... https://www.reuters.com/article/us-usa-stocks-weekahead/halfway-through-2019-tech-leads-on-wall-street-idUSKCN1TT2R7 https://www.reuters.com/article/us-usa-stocks-weekahead/half...

c3534l 7y ago

There's an old saying "economists have correctly predicted 9 out of the last 3 recessions."