
Why the end is coming soon for the biggest tech bubble we’ve ever seen - WheelsAtLarge
https://www.marketwatch.com/story/why-the-end-is-coming-soon-for-the-biggest-tech-bubble-weve-ever-seen-2018-05-22
======
harry8
Say _what_ but not _when_ and you can't be "wrong"

Who will be the next myspace? the next LookSmart? The next Google? The next
RedHat? Startups which have had massive growth will fail. Big established
companies with decades of profitability behind them will also fail.

All booms will bust this boom is not different. The fact that people say "this
boom is different" is how you know it isn't. It has the "this boom is
different" commentary in common with every other boom in history. Really.

Rain is wet and sugar is sweet. Picking winners is hard. Timing the market is
hard. The dumb strategy of getting exposure to all of it so you're fully
diversified has worked for some in the past.

~~~
headsoup
A paradox? Or Irony?

Every boom is the same, but every boom they say 'this boom is different,'
therefore every boom must say 'this boom is different' to be the same.

------
joeblow9999
The sky is falling!!

(repeat until something negative happens then claim prescience. rinse and
repeat)

------
corodra
I’m not a fan of marketwatch, at all, but I do agree. I’ve been noticing way
too much stupid money being thrown around at tech lately. Too much hype. Too
many over promises for really immature tech. Too many firms are constantly
doing pr announcements of funding rounds, like bleeding money is a good thing.

I’ve been thinking this for about a month on my own. I’m not smart enough to
venture a forecast when, but I won’t be surprised if it happens by the end of
the year. Honestly, I hope I’m wrong and it never happens. I’m not an expert
either. Just bad gut feeling.

~~~
mnky9800n
This comment is seen in almost every post positive or negative about the
technology industry. It's mostly meaningless. You have to spend money to make
money. Complaining that sometimes people spend money and don't make money is
stating the obvious.

~~~
corodra
Sorry, I didn't mean just "spending money". When I mean stupid money, it's
mostly there's an exorbitant amount hoping to get rich quick.

Someone that researches a company, industry and the geopolitics involved and
invests... let's say a billion USD, then that market crashes to oblivion, I
don't consider that "stupid money". At all. Try, fail, it sucks. But they did
their own legwork to verify what they're doing. They flat out knew the risks.
Their research probably showed that $1b was worth it.

Someone that goes, for an extreme example, "Bitcoin is going to be worth a
$100,000 a coin because [insert one random article, bird sign, or because
everyone else is doing it]." That's what I have a problem with. That's "stupid
money" to me, chasing ambulances, etc.

The first example I don't feel ever really kills markets. Because their
investment will be proportional to some research in potential market growth
and maturity of the individual. If Google spends $1b on a market, something is
there. But they now have a large foothold. There's still market space, but
Company B decides only $100m because the chances of beating Google are low and
their investment may go to waste. Instead of "If Google went $1b in, we're
going $1b, because reasons." Obviously, their growth speculations can be
wrong. But having some sort of independent research based speculation will
always force someone to be more cautionary than "Oh, he said so, thus it must
be true". That cautionary action, I feel, kind of self-corrects a market by
never letting it get TOO big and out of control.

It's the second example I think just pumps money for no reason. Just a bunch
of people trying to get rich quick because of everyone is doing it.

Eventually, the mature market holders will pull when they get scared because
of their research. There's only so much "real" value in a market and
competitive market space. That'll drop a market significantly to the point
where others follow suite, thus a burst.

------
HillaryBriss
_An end to the era of ultra-low interest rates from the Federal Reserve will
also weigh on these overvalued names. As interest rates continue to rise
throughout 2018, that will accelerate the unicorn slowdown.”_

this interest rate argument is at least somewhat realistic.

~~~
perl4ever
If you look at the historical fed funds rate, it seems like they have
repeatedly raised rates until markets crashed and then cranked them back in a
panic.

I don't understand why they don't set the rate to approximately the current
target (or actual) inflation rate and stop fiddling with it constantly. The
instability seems completely unnecessary, like a bus driver who can't stop
pressing down and letting off the gas over and over.

~~~
headsoup
Much as CIO's every few years in-source and then out-source IT functions.
There is an obvious balance that could be found, but then they must been seen
to 'do something' and so levers are pulled. Et cetera.

------
itronitron
Not necessarily a bad thing, the unicorns are privately held and all of those
businesses are quite superfluous.

~~~
sempron64
Uber is not superfluous. It has added a massive amount of value to the economy
and created hundreds of thousands of service jobs that did not previously
exist, taking a service that was previously lower quality, less desirable and
less useful and improved it on all fronts. A private equity downturn/a bad
IPO/tech crash puts those jobs in peril. Not to mention many of the jobs of
people posting on this site.

~~~
tomtimtall
Those jobs will not be in peril. There are plenty of rideshares and the tech
is trivial compared to the actual services. Uber’s valuation and capital
gamble is not about ridesharing, it’s self driving taxis, and they May very
Well go out of business with that gamble.

