This was predictable and the prediction applied more broadly than just tech start ups. Tech investment in general was over saturated. I was predicting last Apr

This was predictable and the prediction applied more broadly than just tech start ups. Tech investment in general was over saturated. I was predicting last April (2019) that we would be heading into recession within 18-24 months even though we were in the strongest and longest running bear market in history. I wasn’t the only one predicting this as I was seeing several vaguely similar comments here on HN. I had no idea there would be a pandemic, a depression, or that any of it would happen within a year. Investments crashed earlier and harder that I anticipated because the cause of the crash was something I never thought of, but the reaction and result are similar. The reason why people were predicting a recession is that there was/is too much money tied to investment speculation that isn’t reflected in the revenue of a given organization. In more plain terms people were betting on growth even though growth alone couldn’t repay the investments at present, which looks like a Ponzi scheme. The idea of a Ponzi scheme is to bet on growth and then encourage additional layers of investment to drive up the value of the prior layers and then dump it before it implodes, like a game musical chairs. Here are some basic examples: * Uber was a $60 billion unicorn. It was loosing billions every quarter though without any profit in sight and yet people were still investing in it. Now it’s shedding like employees and closing offices. * Amazon is a less extreme and much less obvious example. For one Amazon is profitable, and two Amazon makes money on infrastructure which provides scalable growth. Amazon’s market cap is insane at $1.2 trillion. Amazon generates neither the profit, revenue, sales, or growth to account for anything close to that, which speaks to speculation. As an interesting side note has historically lost money on its retail business and on Prime. It took selling access to its infrastructure to deliver a profit. * For an example of the opposite Bank of America’s stock tanked as a result of the pandemic but it still reported a very strong first quarter a month later. It looks like the bank will continue to perform well in its earning statements even with consumer mortgage and loan forgiveness due to strengths in other banking segments. It will be curious to watch as last week Berkshire Hathaway started dumping its investments in the banking sector. The most notable are its dumping of Wells Fargo and Goldman Sachs that are failing to perform to expectations but it is also the largest single investor in BAC and it is dumping that too. This loss of investments won’t impact current business performance relative to the marketplace in general or to its competitors specifically.