

Why we hate the new tech boom - r0h1n
http://www.salon.com/2013/09/27/why_we_hate_the_new_tech_boom/

======
Apocryphon
Such serendipity for this article to also be published today:
[http://www.theonion.com/articles/google-employees-
disappoint...](http://www.theonion.com/articles/google-employees-
disappointed-15th-anniversary-par,34023/)

------
tenpoundhammer
This is just a bad article. The causal linkages provided by the piece are
laughable and infantile.

"First, there is unsettling realization that the middle is losing economic
ground while Silicon Valley execs babble on about “changing the world” for the
better. Income inequality is growing ever worse, and it is increasingly clear
that one of the forces fueling this trend is the technological innovation
flowing out of the Bay Area. "

One of the forces fueling inequality are the some of the best employers in the
world? New companies creating jobs, and paying living wages?

I could go after many more examples but I have other things to do.

~~~
NTDF9
It is not about living wages. The anguish is that a smaller share of the boom-
profit reaches the bottom.

While a select few people become multi-millionaires, the rest cannot be
expected to be happy about the effect of such wealth on everyone else. Even
regular programmers are not becoming "rich" per se. Yes, we have high-paying
jobs but we are essentially making someone else beyond-your-wildest-dreams
rich.

PS: I agree this is a bad article though.

~~~
Apocryphon
High-paying jobs don't mean much when rent and cost of living are incredibly
high, anyway.

------
7Figures2Commas
It's astonishing how virtually all of the debate around "the new tech bubble"
completely ignores the influence of monetary policy. There are _lots_ of
bubbles that have been inflated by QE-Infinity. The tech bubble is nowhere
near the biggest, but that doesn't mean it isn't a bubble.

> The current freneticism is a very different animal from the original dot-com
> boom. For one thing, the companies racing to go public this September
> actually have revenues and what passes for real business models, something
> that was very often simply not the case in 1999 and early 2000.

Revenue? Great. But at $50+/share, FB has a PE ratio of well over 200. Being
able to calculate a PE ratio is nice though. Salesforce, for instance, which
has a market cap of $31 billion, doesn't even have a PE ratio because it has
no earnings.

Are Facebook, Salesforce, et al. worthless? Of course not. But if the entire
stock market wasn't being propped up by the Fed, you wouldn't see these types
of valuations, and that would have a cascading effect on the entire tech
ecosystem for a variety of reasons.

> The current boom isn’t a flash in the pan, doomed to disappoint arriviste
> gold miners. It’s here to stay. A mature Internet economy is generating huge
> riches, and it is remaking the face of San Francisco and the larger Bay Area
> in the process.

The internet is here to stay, and there will continue to be riches generated
by it, but it's extremely foolish to believe that the internet economy is
disconnected from the real economy, which is precisely what so many, the
author of this article included, seem to be doing.

~~~
NTDF9
> Salesforce, for instance, which has a market cap of $31 billion, doesn't
> even have a PE ratio because it has no earnings.

And yet they flaunt opulence with a Green Day concert
[http://www.greendayauthority.com/news/4473/](http://www.greendayauthority.com/news/4473/)

------
dreamdu5t
> Income inequality is growing ever worse, and it is increasingly clear that
> one of the forces fueling this trend is the technological innovation flowing
> out of the Bay Area.

This claim is unsubstantiated. By what mechanism is Facebook _causing_ income
inequality?

~~~
graeme
Income inequality is, by definition, the gap between those with lower and
higher earnings.

So if Facebook et al. pay higher salaries, and other salaries don't increase,
then income inequality increases.

This isn't necessarily a bad thing, but it seems obvious that soaring tech
salaries will increase inequality.

~~~
aetherson
Certainly true. I note that this is causing the "good" half of income
inequality, though: the "some people are getting richer" part, not the "other
people are getting poorer or staying the same" part.

(I digress, but: we all agree that given three different possible worlds, A,
B, and C, where in A, everyone's poor, in B, most people are poor and some are
rich, and in C, everyone's rich, C is the best, and A is the worst, right?
Nobody's here to argue that A is better than B?)

To the extent that you can draw a causal line from "tech boom" to the bad half
of income inequality (the "lots of people are getting poorer or stagnating"
part), it's more about "wealth gets tied up in companies that just
intrinsically employ fewer people than the labor-intensive manufacturing
companies of the mid 20th Century."

