4 ms·

If YouTube goes from having 100% market share to the 27th-largest video site, you will definitely say that it has failed. That is the history of US Steel.

FredPret 3y ago
Youtube is a platform business. Being in the top 5 is everything because that's how you get creators and consumers. If Youtube fell to #27, it would be a ghost town and lose a ton of money. But steel is just steel. You make it and then you sell it. If you make money, great. That is what US Steel does. They make steel, they sell it at a profit. I call that a win.
- jeffbee 3y ago
  Fair. But it's not like US Steel has just been humming along for decades printing money. There are a lot of failure smells about it. Hundreds of thousands of people have been laid off at least once. Dozens of mills have been shut down.
  - FredPret 3y ago
    Correct. But they seem to have sorted out many of the biggest issues. They could probably continue profitably as-is for the foreseeable future though, which is really the most you can hope for from a business.
    - xp84 3y ago
      While I actually agree with you personally that not everything should have to grow forever, a business that "just" delivers a consistent profit every year is considered a failure by those who expect YoY capital appreciation (at some multiple of the interest rate on a savings account), i.e. shareholders. Such businesses usually get sold to someone with a "growth" plan for them, which is usually some combo of combining overhead expense by merging it with another business, cost-cutting, as well as the more toxic short-term tricks such as selling all their owned land and leasing it back to goose profits for a few years. Oh, and share buybacks.
      - FredPret 3y ago
        I'm sure that's true for many shareholders; anecdotally I'm a very happy US Steel shareholder (especially after today!). There are many folks who are long-term-value oriented who would much rather own a healthy and sustainable business than something that looks good short-term but is getting IBM'ed long-term. Case in point: Warren Buffett and See's Candy. I like the steady accumulation of equity or dividends paid out to me. The business doesn't need to go to the moon for that to happen.
        lavajava 3y ago
        Can you please explain how Warren Buffett has IBM’ed See’s Candy over the long-term?
        FredPret 3y ago
        I meant the opposite. Warren Buffett is letting See's Candy is happily chug along, staying true to their identity (as far I hear, I'm not a customer), whereas another investor might have insisted on quick quarterly results and ended up IBMing them.
      - 4ggr0 3y ago
        > While I actually agree with you personally that not everything should have to grow forever nothing should have to grow forever. especially not amounts of natural resources, or basic necessities like food and beverages.
        FredPret 3y ago
        We've barely scratched the surface of the planet, literally. The deepest mines are 4km deep; mineral deposits are likely to get richer as you go deeper. With desalination, nuclear + solar + geothermal, we can feed an essentially unlimited number of people. There are always second-order effects to everything, including growth. But I find it interesting that we have such a huge runway ahead of us, without even considering resources and energy elsewhere in the solar system.
postalrat 3y ago
It will fall to 27th and beyond. It's just a matter of time. Everything fails if you only look at the last few moments.

FredPret 3y ago

Youtube is a platform business. Being in the top 5 is everything because that's how you get creators and consumers. If Youtube fell to #27, it would be a ghost town and lose a ton of money. But steel is just steel. You make it and then you sell it. If you make money, great. That is what US Steel does. They make steel, they sell it at a profit. I call that a win.

jeffbee 3y ago
Fair. But it's not like US Steel has just been humming along for decades printing money. There are a lot of failure smells about it. Hundreds of thousands of people have been laid off at least once. Dozens of mills have been shut down.
- FredPret 3y ago
  Correct. But they seem to have sorted out many of the biggest issues. They could probably continue profitably as-is for the foreseeable future though, which is really the most you can hope for from a business.
  - xp84 3y ago
    While I actually agree with you personally that not everything should have to grow forever, a business that "just" delivers a consistent profit every year is considered a failure by those who expect YoY capital appreciation (at some multiple of the interest rate on a savings account), i.e. shareholders. Such businesses usually get sold to someone with a "growth" plan for them, which is usually some combo of combining overhead expense by merging it with another business, cost-cutting, as well as the more toxic short-term tricks such as selling all their owned land and leasing it back to goose profits for a few years. Oh, and share buybacks.
    - FredPret 3y ago
      I'm sure that's true for many shareholders; anecdotally I'm a very happy US Steel shareholder (especially after today!). There are many folks who are long-term-value oriented who would much rather own a healthy and sustainable business than something that looks good short-term but is getting IBM'ed long-term. Case in point: Warren Buffett and See's Candy. I like the steady accumulation of equity or dividends paid out to me. The business doesn't need to go to the moon for that to happen.
      - lavajava 3y ago
        Can you please explain how Warren Buffett has IBM’ed See’s Candy over the long-term?
        FredPret 3y ago
        I meant the opposite. Warren Buffett is letting See's Candy is happily chug along, staying true to their identity (as far I hear, I'm not a customer), whereas another investor might have insisted on quick quarterly results and ended up IBMing them.
    - 4ggr0 3y ago
      > While I actually agree with you personally that not everything should have to grow forever nothing should have to grow forever. especially not amounts of natural resources, or basic necessities like food and beverages.
      - FredPret 3y ago
        We've barely scratched the surface of the planet, literally. The deepest mines are 4km deep; mineral deposits are likely to get richer as you go deeper. With desalination, nuclear + solar + geothermal, we can feed an essentially unlimited number of people. There are always second-order effects to everything, including growth. But I find it interesting that we have such a huge runway ahead of us, without even considering resources and energy elsewhere in the solar system.

postalrat 3y ago

It will fall to 27th and beyond. It's just a matter of time. Everything fails if you only look at the last few moments.