> That's what Warren Buffet invests in (Davita Dialysis, Exxon, Apple, rail lines ---> all monopolies). That's what Peter Thiel tries to invest in (Zero to One)

> That's what Warren Buffet invests in (Davita Dialysis, Exxon, Apple, rail lines ---> all monopolies). That's what Peter Thiel tries to invest in (Zero to One). That's what successful Y Combinator companies ultimately strive to become. Buffett invests in companies with a durable competitive advantage which is also often called a "moat". A monopoly is a situation where there is no competition. As a counterexample, although I agree that Coca-Cola has unfair advantages, such as brand name and economies of scale, over new competitors, they do not have a monopoly. > The most valuable companies before and after this era of low interest rates were and continue to be monopolies. That's not necessarily true. The most valuable companies, that is, the companies with the highest valuations are those which make the most money. Or, as Joel Greenblatt puts it: "Price follows earnings." If you want to buy a barn which very likely earns 10 mln per year for now until 2032, then a fair price would be at least 10 x 10 million discounted for the fact that money today is worth more than money tomorrow. Then, after 10 years you still own a farm and any extra income that is produced by it. Of course, this value fluctuates a lot depending on all kinds of factors, but this is generally the process that value investors use to determine the fair value. In the long run, it works as you can see when looking at the net worth of value investors such as Buffett. The only thing that a monopoly "does" is that it makes it easier to predict what the future earnings are going to be. What is typically the case after bubbles is that people take actual earnings into account again. During speculative bubbles, it is very hard to buy things based on reasonable future earnings calculations. The price is driven purely by speculation. What historically has happened after bubbles is that prices become more reasonable again. That's why big companies with unreasonable valuations such as Tesla and Cloudflare have gone down respectively 55% and 62% in price in this year while big companies with more reasonable valuations such as Macy's, Citigroup, or JPMorgan have gone down only 20%. > Societal value creation is not the same as value creation to shareholders. The latter can be achieved by the former, but the former is not a requirement for the latter. Agreed. Capitalism is a ruthless and terrible system, but better than the alternatives. > On the flip side of things, lowering wages for software engineers is going to enable many institutions and companies that do not operate as tech monopolies or startups to start to get some of the benefits of skilled software engineers! Agreed!