3 ms·
Explain Amazon then, a company notorious for being unprofitable yet producing a great experience. Markets are kind of a dumb thing if you think about it. You t
by mempko 2y ago
Explain Amazon then, a company notorious for being unprofitable yet producing a great experience.
Markets are kind of a dumb thing if you think about it. You take all the qualities of an item and project them into a single scalar we call 'price'. Then use that scalar as a form of comparison.
It's comical when you think about it. Seems we need a better technology now that we have computers.
- sien 2y agoAmazon invested profits. For many years ago they could turn a switch and become profitable. The share price kept rising while they were investing profits in expanding. It's far from a fool proof way of doing things, many companies that prioritise growth over profitability wind up with neither, but Amazon managed it. As for prices, no computer can work out my preference or not for a Mac over a PC, or a iPhone over an Android, or how much quality I will pay for in a bike. Prices reveal this. Ludwig von Mises said this was why Communism wouldn't work in 1920. He was right. https://en.wikipedia.org/wiki/Economic_calculation_problem https://en.wikipedia.org/wiki/Economic_calculation_problem
- mempko 2y agoYou misunderstood what I meant about prices. My point is prices compress everyone's preferences and ability to pay into a single scalar. It seems we can do better no?
- etblg 2y agoTheir net income for the previous quarter results was $15.3 billion, in what way are they known for being unprofitable?