4 ms·

What Happened to All the Diamonds in the Rough?

28 points by jger15 5y ago

rektide 5y ago
Super ultra real to me, confirms what feels like the late state of play. Super hard to get stuff started when life everywhere feels so damned expensive. So new value fails to take root & start. And- here's a little more of a gyess- the systems that be ossify.
- sokoloff 5y ago
  Everything being so expensive provides windows of opportunity itself though. If everything was already cheap and plentiful, it would be differently hard to find a compelling new value case. “Your margin is my opportunity” as one prominent modern businessman has said. If things are expensive or difficult for other consumers, it doesn’t take much for them to divert some of their resources to cheaper and/or better substitutes. If you’re in the business of providing that, it’s far better for you for the world to be too expensive than too cheap.
mooreds 5y ago
I was curious why the author didn't call out the vast changes in access to: * stocks (given the cost and access changes over the last 50 years, let alone the last 10) * knowledge (just like with real estate, "knowledge" used to be far more siloed/protected) * diversification (the rise of the index funds and the portfolio theory that suggests them)
- sokoloff 5y ago
  They partly did. In a pull quote they selected: “Shortly after World War II…a substantial segment thought that the stock market was a place where cattle were sold.”
abernard1 5y ago
An alternative explanation: those prior eras produced actual things, and those were capital intensive. Upside risk on capital intensive industries is more variable and one would not expect all companies in the sector to go up. But now, in our glorious era of not producing things and outsourcing everything, we have FIRE industries that can only appreciate in value with monetary inflation. And the reason why this very obvious connection between cost of capital and valuations will go unremarked is because SV and sites like this one have been chief contributors to this destruction of real value over the last two decades. The software tech dynamic of the 21st century will go down as the largest value capture in history.
deleted 5y ago
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28 points by jger15 5y ago

Super ultra real to me, confirms what feels like the late state of play. Super hard to get stuff started when life everywhere feels so damned expensive. So new value fails to take root & start. And- here's a little more of a gyess- the systems that be ossify.

sokoloff 5y ago
Everything being so expensive provides windows of opportunity itself though. If everything was already cheap and plentiful, it would be differently hard to find a compelling new value case. “Your margin is my opportunity” as one prominent modern businessman has said. If things are expensive or difficult for other consumers, it doesn’t take much for them to divert some of their resources to cheaper and/or better substitutes. If you’re in the business of providing that, it’s far better for you for the world to be too expensive than too cheap.

mooreds 5y ago

I was curious why the author didn't call out the vast changes in access to: * stocks (given the cost and access changes over the last 50 years, let alone the last 10) * knowledge (just like with real estate, "knowledge" used to be far more siloed/protected) * diversification (the rise of the index funds and the portfolio theory that suggests them)

sokoloff 5y ago
They partly did. In a pull quote they selected: “Shortly after World War II…a substantial segment thought that the stock market was a place where cattle were sold.”

abernard1 5y ago

An alternative explanation: those prior eras produced actual things, and those were capital intensive. Upside risk on capital intensive industries is more variable and one would not expect all companies in the sector to go up. But now, in our glorious era of not producing things and outsourcing everything, we have FIRE industries that can only appreciate in value with monetary inflation. And the reason why this very obvious connection between cost of capital and valuations will go unremarked is because SV and sites like this one have been chief contributors to this destruction of real value over the last two decades. The software tech dynamic of the 21st century will go down as the largest value capture in history.

deleted 5y ago

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