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Well that just means that a rational investor would make a killing amid this chaos, wouldn't he? So, we have to assume that for the last decade, not a single V

Well that just means that a rational investor would make a killing amid this chaos, wouldn't he? So, we have to assume that for the last decade, not a single VC in the industry have been rational enough to pick up easy money everybody else is overlooking?

wayoutthere 7y ago
There has been too much easy money flying around the VC world for the last 30 years that people have literally forgotten how to operate any other way. People have lived entire careers in this environment, so the rational move for them is the current status quo. But the paradigm is shifting. Where will we end up? My money is on early 20th century style oligarchic capitalism, but that’s not a very appealing proposition for a lot of people.
- tossAfterUsing 7y ago
  > My money is on early 20th century style oligarchic capitalism I've been enjoying the historical context in this book. I'm not surprised to be liking the book, but i'm pleased to be getting a better understanding of what the early 20th century space was like. https://www.goodreads.com/book/show/36448501-the-bitcoin-standard https://www.goodreads.com/book/show/36448501-the-bitcoin-sta...
  - wayoutthere 7y ago
    I wholeheartedly disagree with any decentralized approach to national economics. Not because it wouldn’t work, but because it would. Money is power only because power likes it that way. But power is power, and a decentralized monetary supply does not serve the powerful. They will attack it with every weapon they have (which is basically all of them) to ensure it doesn’t happen until they control it. In the early 20th century, the rich owned gold mines. Once we moved off the gold standard, they simply took that wealth and put it into the fiat system by owning companies. Even if we do end up on a nominally crypto-backed monetary system, I would expect any governance (even decentralized) to favor the incumbent wealthy as much if not more than our existing system.
    - Nasrudith 7y ago
      I look at it in a systems way. If it /doesn't/ serve those with any actual wealth to back the currency to use it then the question becomes why would anybody use it? I don't see how it could work at all even without some vague nebulous bogeyman stopping it. It brings to mind the conspiratorial "big Pharma is withholding the cure" thinking while ignoring that selling the cure would make them way more, that the long term treatment is competitive, and a cure effectively monopolizes the whole segment of drugs and treatments. The real reason cures are rare is because they are /hard/. With large buy in from lesser concentrations of wealth it could be a "peso" at best - something used by lesser wealths to trade to their localized advantage but lacking the power of big movers.
    - thatfrenchguy 7y ago
      > Even if we do end up on a nominally crypto-backed monetary system, I would expect any governance (even decentralized) to favor the incumbent wealthy as much if not more than our existing system Because they can own all the GPUs/ASICs/whatever you'll use as proof of work / proof of stake for your cryptocurrency ?
    - tossAfterUsing 7y ago
      > I wholeheartedly disagree with any decentralized approach to national economics. do you then agree with only a centralized national economics? what does that even look like?
rossdavidh 7y ago
Well, if the available resources are being bid up by billions going into goofy ideas, then the cost to the "rational" investor has gone up. The resources for the $40billion startup didn't get created out of thin air by the Softbank money, they got taken from a finite pool, and thus are unavailable for other startups. Softbank pushed money into the startup space, but didn't add any real resources, so it just distorted the ability of the market to allocate them appropriately.
rolltiide 7y ago
A rationale investor is not moving enough money to make a difference The sustainable project isnt providing liquidity for 20 years if it even gets enough capital to execute at all, whereas the Softbank FOMO project will in 5 years after they are involved. You are betting on founders and their network, not their idea.
imtringued 7y ago
I don't see how that follows. Usually what happens is that those sustainable companies are copied by another company. This is perfectly fine but then that second company uses it's access to VC money to eliminate the competition. The sustainable company will have to close shop and years later the unsustainable company will close as well. Meanwhile the VCs don't care because some unicorn investment got them 20x returns.

wayoutthere 7y ago

There has been too much easy money flying around the VC world for the last 30 years that people have literally forgotten how to operate any other way. People have lived entire careers in this environment, so the rational move for them is the current status quo. But the paradigm is shifting. Where will we end up? My money is on early 20th century style oligarchic capitalism, but that’s not a very appealing proposition for a lot of people.

tossAfterUsing 7y ago
> My money is on early 20th century style oligarchic capitalism I've been enjoying the historical context in this book. I'm not surprised to be liking the book, but i'm pleased to be getting a better understanding of what the early 20th century space was like. https://www.goodreads.com/book/show/36448501-the-bitcoin-standard https://www.goodreads.com/book/show/36448501-the-bitcoin-sta...
- wayoutthere 7y ago
  I wholeheartedly disagree with any decentralized approach to national economics. Not because it wouldn’t work, but because it would. Money is power only because power likes it that way. But power is power, and a decentralized monetary supply does not serve the powerful. They will attack it with every weapon they have (which is basically all of them) to ensure it doesn’t happen until they control it. In the early 20th century, the rich owned gold mines. Once we moved off the gold standard, they simply took that wealth and put it into the fiat system by owning companies. Even if we do end up on a nominally crypto-backed monetary system, I would expect any governance (even decentralized) to favor the incumbent wealthy as much if not more than our existing system.
  - Nasrudith 7y ago
    I look at it in a systems way. If it /doesn't/ serve those with any actual wealth to back the currency to use it then the question becomes why would anybody use it? I don't see how it could work at all even without some vague nebulous bogeyman stopping it. It brings to mind the conspiratorial "big Pharma is withholding the cure" thinking while ignoring that selling the cure would make them way more, that the long term treatment is competitive, and a cure effectively monopolizes the whole segment of drugs and treatments. The real reason cures are rare is because they are /hard/. With large buy in from lesser concentrations of wealth it could be a "peso" at best - something used by lesser wealths to trade to their localized advantage but lacking the power of big movers.
  - thatfrenchguy 7y ago
    > Even if we do end up on a nominally crypto-backed monetary system, I would expect any governance (even decentralized) to favor the incumbent wealthy as much if not more than our existing system Because they can own all the GPUs/ASICs/whatever you'll use as proof of work / proof of stake for your cryptocurrency ?
  - tossAfterUsing 7y ago
    > I wholeheartedly disagree with any decentralized approach to national economics. do you then agree with only a centralized national economics? what does that even look like?

rossdavidh 7y ago

Well, if the available resources are being bid up by billions going into goofy ideas, then the cost to the "rational" investor has gone up. The resources for the $40billion startup didn't get created out of thin air by the Softbank money, they got taken from a finite pool, and thus are unavailable for other startups. Softbank pushed money into the startup space, but didn't add any real resources, so it just distorted the ability of the market to allocate them appropriately.

rolltiide 7y ago

A rationale investor is not moving enough money to make a difference The sustainable project isnt providing liquidity for 20 years if it even gets enough capital to execute at all, whereas the Softbank FOMO project will in 5 years after they are involved. You are betting on founders and their network, not their idea.

imtringued 7y ago

I don't see how that follows. Usually what happens is that those sustainable companies are copied by another company. This is perfectly fine but then that second company uses it's access to VC money to eliminate the competition. The sustainable company will have to close shop and years later the unsustainable company will close as well. Meanwhile the VCs don't care because some unicorn investment got them 20x returns.