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I think the answer is a bit more simple than that. Where else should people put their money if not in high tech? Industrials correlate to GDP, and GDP is proje

I think the answer is a bit more simple than that. Where else should people put their money if not in high tech? Industrials correlate to GDP, and GDP is projected to be flat. Same goes with consumer products and volatility is too high in media. If you have capital to put to work, Tech appears to have the highest risk/return profile. Phrased differently: if you had $10mil, where would you put it?

Evgeny 16y ago
Phrased differently: if you had $10mil, where would you put it? 25% stocks, 25% bonds, 25% gold, 25% cash? (That's literally what the "Fail-Safe Investing" book boils down to. http://en.wikipedia.org/wiki/Fail-Safe_Investing http://en.wikipedia.org/wiki/Fail-Safe_Investing)
- borism 16y ago
  fail-safe meaning you're ready to lose up to 50% of your investments? cause quite a few things on that list are mutually exclusive...
  - Evgeny 16y ago
    The author argues that these four types of investments are very unlikely to go down at the same time - if one loses a lot, the other types grow. " It might seem that a Permanent Portfolio containing these four contradictory investments would be neutralized: As one element rose, another would fall and nothing would be gained. On a day-to-day basis, that can be true. But over broad periods of time, the winning investments add more value to the portfolio than the losing investments take away." He gives some numbers in the book, from 1970 till 2002 the portfolio lost money only in four years: 6.2% in 1981, 0.7% in 1990, 2.4% in 1994, and 1.0% in 2001. Three of these four years were followed by double-digit gains. The average gain was 9.5% per year.
    - borism 16y ago
      70-02 period is pretty irrelevant in today's world though. how did such portfolio perform during Great Depression, which is more like what we face today?
      - DanI-S 16y ago
        Would it have been possible to raise $8m in VC funding for a glorified slideshow during the Great Depression?
      - Evgeny 16y ago
        I think the author wrote from personal experience, so he could be either too young or not even born yet during Greate Depression.
        borism 16y ago
        unfortunately investment advice written from personal experience is pretty useless if not harmful.
jhasky 16y ago
"GDP is projected to be flat." This is utterly absurd and shows a complete misunderstanding of economic growth.
- wazoox 16y ago
  On the contrary, it makes sense. There were a huge influx of liquidities from the central banks around the world, and this money needs to be invested into something. Western GDP is pretty flat now and has been for a while if you don't take into account the various credit bubbles, and will probably stay so for the foreseeable future - as long as oil prices stay over 75$ a barrel at least, which may very well be forever.
quantize 16y ago
are internet companies still considered high-tech? http://en.wikipedia.org/wiki/High_tech http://en.wikipedia.org/wiki/High_tech

Evgeny 16y ago

Phrased differently: if you had $10mil, where would you put it? 25% stocks, 25% bonds, 25% gold, 25% cash? (That's literally what the "Fail-Safe Investing" book boils down to. http://en.wikipedia.org/wiki/Fail-Safe_Investing http://en.wikipedia.org/wiki/Fail-Safe_Investing)

borism 16y ago
fail-safe meaning you're ready to lose up to 50% of your investments? cause quite a few things on that list are mutually exclusive...
- Evgeny 16y ago
  The author argues that these four types of investments are very unlikely to go down at the same time - if one loses a lot, the other types grow. " It might seem that a Permanent Portfolio containing these four contradictory investments would be neutralized: As one element rose, another would fall and nothing would be gained. On a day-to-day basis, that can be true. But over broad periods of time, the winning investments add more value to the portfolio than the losing investments take away." He gives some numbers in the book, from 1970 till 2002 the portfolio lost money only in four years: 6.2% in 1981, 0.7% in 1990, 2.4% in 1994, and 1.0% in 2001. Three of these four years were followed by double-digit gains. The average gain was 9.5% per year.
  - borism 16y ago
    70-02 period is pretty irrelevant in today's world though. how did such portfolio perform during Great Depression, which is more like what we face today?
    - DanI-S 16y ago
      Would it have been possible to raise $8m in VC funding for a glorified slideshow during the Great Depression?
    - Evgeny 16y ago
      I think the author wrote from personal experience, so he could be either too young or not even born yet during Greate Depression.
      - borism 16y ago
        unfortunately investment advice written from personal experience is pretty useless if not harmful.

jhasky 16y ago

"GDP is projected to be flat." This is utterly absurd and shows a complete misunderstanding of economic growth.

wazoox 16y ago
On the contrary, it makes sense. There were a huge influx of liquidities from the central banks around the world, and this money needs to be invested into something. Western GDP is pretty flat now and has been for a while if you don't take into account the various credit bubbles, and will probably stay so for the foreseeable future - as long as oil prices stay over 75$ a barrel at least, which may very well be forever.

quantize 16y ago

are internet companies still considered high-tech? http://en.wikipedia.org/wiki/High_tech http://en.wikipedia.org/wiki/High_tech