[graceyang]

I have a serious question: why do people get upset at bubbles? Is it jealousy that others are getting investment or flipping their companies where you perceive little value? I'm not asking to be a bitch - just curious cause i feel some of those emotions myself but I rationally know that they are counterproductive.

Shouldn't we be happy for our startup brethren? Does color's funding hurt you (or the industry?). I imagine all this froth is serving to make it easier for worthy people to get investment, raising developer salaries and other generally good things.

Would appreciate serious feedback.

[jedsmith]

Recalling the .com bubble, when the bottom falls out there is a lot of collateral damage, and not just to the players involved. Those of us on the sidelines and not involved in the idea-investment-flip cycle will suffer when the industry inevitably implodes upon itself. Facebook's valuation, specifically, has a lot of echoes to the past.

http://en.wikipedia.org/wiki/Dot-com_bubble#Aftermath briefly mentions the ripple effect on programming jobs.

As a result, there tends to be some animosity toward watching the cycle repeat itself.

[graceyang]

I was too young to experience the job market post the first dot-com bubble but I would argue that if you're in a job that is going to suffer from the collapse of this current bubble, you're most likely currently benefiting from the bubble already. If not, the collateral damage should be relatively low. Would a 37signals, patio11's BCC really be affected by a crash of this current investment bubble? Probably not.

[alex_c]

After a bubble bursts, the pendulum tends to swing the other way, towards extreme thrift, caution, and near-paranoia - it affects spending as well as investment. The over-correction can hurt everyone.

[jedsmith]

> I was too young to experience the job market post the first dot-com bubble but I would argue that if you're in a job that is going to suffer from the collapse of this current bubble, you're most likely currently benefiting from the bubble already.

A good point, but with respect to the .com bubble, Internet commerce's crash also affected the entire economy as well as ancillary companies in the IT sector. So I'm not sure that I necessarily agree; I work for a hosting company, and all of these bubble companies need hosting. You can see where A meets B, there.

[Klonoar]

While I agree with most other replies to you, I'll provide an alternative point.

Bubbles sicken me because they truly bring out the worst of the investor types, the ones who will throw money at anything regardless of its use case.

This is $41 fucking million dollars we're talking about here, and it's spent on a god damned mobile application to connect people with others in random arbitrary situations. People do not have a difficult time doing this, an application on a phone isn't going to make a difference. We're all human at the end of the day.

Now stop and think about what that $41 million could do in this world. This is nothing more than a bunch of rich kids circle jerking one another in what's a disgusting take on business principles in general. $41 million could create several businesses that could further create more jobs for the US economy; $41 million could be fucking used to help Japan out of a bind.

Instead, it's being used to buy a domain name for $350,000. It's being used to build another mobile application that isn't even that technically impressive. It's sickening, and I would never consider working for a company like that. As an engineer, I'd very much question those who'd consider it.

Get the fuck over yourselves.

[krainboltgreene]

    I have a serious question: why do people 
    get upset at bubbles? 

Because bubbles are unsustainable. Almost anyone who gets into a bubble, even at the beginning, will end up losing in the end.

But more importantly, a bubble doesn't keep going. It eventually pops and then the entire industry suffers. Why would you want the industry to suffer? You make money in it, I assume.

[kovar]

It isn't just the industry, it is the entire economy that suffers. The rush of funds to the industry drives demands for service industries and their jobs, among other things. When the bubble bursts, the industry certainly takes a hit, but so does everything that built up to support the industry.

Think outside the bubble.

[cegascon]

Bubbles create large wealth when on the upside but wealth creation at a rapid extend creates a high volatility in markets until a point where people can no longer follow their current way of life. By then the bottom of the pyramid falls and the economy collapse. Your clients are to one bringing the business and is wealth is not properly give away they cannot afford them anymore and your the one suffering and the end. Read Henry Ford's theory.

[ceejayoz]

> I have a serious question: why do people get upset at bubbles?

Bubbles collapse, generally with painful consequences for the entire industry. Great business ideas that would've gotten funding during a non-bubble often can't find funding after a bubble.

[rayboyd]

Bubbles tend to burst when they become over inflated. If it pops it'll likely take the rest of the 'industry' with it.

[haploid]

Because overinvestment in a specific sector of the economy necessarily results in underinvestment in other sectors of the economy.

In the case where investment capital flows to ultimately unproductive enterprises like photo sharing, and away from productive enterprises like efficient batteries, cancer drugs, etc, humanity suffers in the long term.

Now it's possible that the proliferation of photo sharing services is increasing the efficiency of photo sharing that people were doing previously, thus freeing up time to engage in other productive pursuits, so it's not necessarily a bad thing to sink investment capital into ventures that appear unproductive in and of themselves.

But I would highly suspect that this is not the case for the current bubble. It's quite likely that photo sharing apps are actually generating demand for photo sharing activity, thus being a net drain on actual economically productive activity.