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by ajamesm 3382 days ago
Yeah, private equity is a natural response to business failing in the wake of a bubble, but bubbles themselves are market distortions caused by insane valuations.

Highlighting the value of reclamation just draws the heat off of the irrationality of the tech bubble. Amazon isn't a rich ecosystem, it's oligarchic.

And, indeed, any systemic failure in a capitalist economy gets explained away by saying that some cadre of vultures will exploit arbitrage until the gap closes. No one really questions the systemic failures per se. The economy happily creates this surplus in full anticipation of it being scrapped and fed to vultures. Banks repossess cars and capitalists think "working as intended" instead of "there's so many delinquent car loans that there's an industry of repo men and maybe that's significant." This criticism extends similarly to the tech bubble.
2 comments
ch4s3 3382 days ago
>Amazon isn't a rich ecosystem, it's oligarchic.

I think the gp meant https://en.wikipedia.org/wiki/Amazon_rainforest

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ajamesm 3382 days ago
facepalm Thanks.
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ch4s3 3382 days ago
The context mixes the metaphor and the pun(intentional or not).
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geofft 3382 days ago
Right, this line of reasoning sounds vaguely like the broken-window fallacy: https://en.wikipedia.org/wiki/Parable_of_the_broken_window

That is, if people being fired from these miserable startups is good for the economy, wouldn't them not having worked there at all have been even better?

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TJ-14 3382 days ago
Thats true if we already had a way of knowing they would fail but we don't. Startups are how you try new ideas to find the good ones. Do having them work there and fail creates informational value.
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mathattack 3382 days ago
This is exactly the point. It's very hard to know which ideas will work, and which teams are best suited for the task. The beauty of the VC model is that it starts companies on the cheap. Many companies fail, and those people can go chase either the companies that won, or new startups. It's much better than a world where you have a couple monopolies with grand strategic plans that don't actually get anything done.

The East Coast Monopoly mindset was why Xerox PARC had money to create things, but never got anything done with them.

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