3 ms·

> "As long as VC is lighting money on fire on obviously stupid ventures" The difference is that I'm not forced to fund those idiots.

• no_wizard 3y ago
  In some ways you are, since we all pay the cost of monetary policy and 0% interest rates didn't happen in a vacuum. They're interconnected and in more ways than monetary policy but its the most obvious example. Now I'm not debating the merits here, simply stating that the speculation VCs engaged in was in large part due to the "cheapness" of money, which is directly the result of monetary policy since 2008 or so. This drives things like safe returns vs riskier returns, which can in turn fuel bubbles since safe returns[0] can't pace inflation, the money goes elsewhere, into riskier things over time, creating bubbles and over-investment as people chase better returns. This makes it more expensive over time to do things, like holding safe investments vs riskier ones, because your future value is eroded. This also translates into other societal issues, and while it may not always be the main cause it will exacerbate existing problems, particularly in markets where financing is prevalent, like housing. [0]: Such as Certificates Of Deposit, which are all the rage again now that interest rates are higher than have been in ~15 years