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0 pointsmisja1116y ago0 comments

Still, in 2000 the situation was quite different. IT companies had been hiring like crazy based on the assumption that infinite Internet growth would require infinite resources. And then, it turned out it was all a bubble and most of the IT workforce was not needed.

Right now there is not much fundamentally wrong with the economy, there is just a temporary setback because of the Corona lockdown. Things will go back to normal after the epidemic is over, provided that it doesn't last too long and except for some companies who were not doing too well beforehand already.

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3 comments · 3 top-level

samsonradu6y ago

> Right now there is not much fundamentally wrong with the economy, there is just a temporary setback because of the Corona lockdown.

A very bold claim there. There are a lot of things 'wrong' with the economy, starting with negative-yielding sovereign debt, corporate debt, repo markets, politics interfering with Central bank decisions, PE levels and ending with 30% stock market gains in 2019.

futhey6y ago

Is it different though, if you zoom out far enough?

Raising money a year ago was so ridiculously easy, every company I had any visibility in to just threw money at every problem they encountered. Hired like crazy, to satisfy their egos, and to keep up with their peers. Growth over profitability.

I'm being hyperbolic to some degree, every company is different. And certainly no one is adding a dotcom to their name in hopes of raising more cash with less revenue. Or maybe that's exactly what Casper and WeWork and the like were doing.

I think once we get a bit more perspective (10 years from now) it'll be a lot easier to answer these questions.

aguyfromnb6y ago

>IT companies had been hiring like crazy based on the assumption that infinite Internet growth would require infinite resources. And then, it turned out it was all a bubble and most of the IT workforce was not needed.

How are you confident that this isn't exactly what's happening now, and the virus was a catalyst?

People have been talking about the froth, seriously, for a couple years. Theranos, WeWork, SoftBank, the recent IPO busts...

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