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The Death Of Hopium

Tyler Durden's picture




 

Submitted by Adam Taggart via PeakProsperity.com,

As many readers know, I spent 15 years working in Silicon Valley before partnering up with Chris to start Peak Prosperity.

I got my MBA at Stanford in 1999 when the dot-com bubble was at its zenith, and worked for both a VC-funded start-up as well as one of the biggest Internet juggernauts (Yahoo!). I lived in Palo Alto, the central core of the tech scene.

As a result, I have a pretty good read on how Silicon Valley works. Many of the folks I worked and went to school with are now in leadership positions at the big operating companies, VC firms and hedge funds in that ecosystem -- so I have personal knowledge of who's making the decisions.

And it's no secret that I think it's degenerated into a steaming pile of hucksterism.

The "engine of our economy", the "cradle of innovation", the "land of tomorrow" -- whatever breathless hyperbole the fawning media is using this week -- is a sham. Silicon Valley has become a factory of hype, funneling gobs of early-stage capital into whatever half-credible concepts it can think of, and then pimping the artificially-inflated initial results of those tarted-up ventures to whichever "greater fool" is willing to acquire it or buy its IPO. Let that idiot figure out if it will ever turn a profit...

Like the too-cozy relationship between DC and Wall Street, I see a similar one between Wall Street and the Tech sector. They collude to pump out as many opportunities as they can -- private placements, acquisitions, IPOs, secondary offerings -- to cash out the insiders and foist the long-term financial risk onto the "dumb money" (pension funds, foreign capital, retail investors, corporations desperate to enter the "digital age"). The dreams of 'changing the world' or revolutionizing lives by making great products have taken a distant back seat to the drive to have as lucrative an "exit" as possible. If that exit requires selling junk to unassuming buyers, so be it.

As with Wall Street in general, the Tech story has been driven by ferocious and cheap liquidity. The Fed and the other major world central banks pumped trillions and trillions of freshly-printed money into the system starting in 2008, and it largely went into the hands of the major financial institutions and the top 1%. All that money has to go somewhere, and the high-potential rewards offered by tech ventures is a really attractive magnet for it. Couple that with the administration's "Don't worry, technology will save us!" meme to calm market jitters, and the media's amplification of that message in desperate hopes it will come true, and money has been lining up to enter Silicon Valley over the past 6 years. There literally have not been enough ventures to invest in to soak up the supply of capital sloshing around Silicon Valley.

This, of course, has led to the stupidly fast pace at which we've entered Tech Bubble 3.0. Facebook, LinkedIn, Twitter, etc went public several years back to astronomical valuations given their (lack of) profits. Since then, a herd of "unicorns" -- start-up companies with no profits but $multi-billion valuations -- stampeded onto the scene. A new mythos of all-knowing visionaries (Musk, Kalanick, Dorsey, etc) emerged to replace the previous generation of "god like" sages (like Jobs, Schmidt, Bezos). A sense of hubris and entitlement returned to the rank-and-file employees working within the over-designed and over-perked corporate HQ-plexes that pepper the 101 corridor. Real estate prices in San Francisco and surrounding counties blew through the previous heights set in 2007, and housing affordability there is now at a record low. And a new dynamic this time, capital flooding in from Asia (mostly China and India) has provided the rocket fuel at the margin for prices of both homes and companies to soar.

How shockingly little we learn from history.

Not ancient history, mind you. We saw this movie play out just 7 years ago in 2008. And that took place 7 short years after the initial dot-com bubble burst in 2001.

As they say, "Those who cannot remember the past are condemned to repeat it". The Ponzi-like party that the current crop of Technorati are enjoying cannot last forever. It can only continue as long as incoming capital flows exceed demand, and someone is willing to bid higher than the seller's basis.

Well, there's growing evidence that the end is nigh. (Finally! shout those of living out here with a front row seat to the insanity).

As with all bubbles -- which are a product of mass psychology -- they resist all influence of logic and fundamentals until perception shifts. It's at that moment, when the veil of hopium is cleared from the public's eyes, that the fawning crowd can suddenly see that the emperor is actually naked.

And we are finally seeing the initial signs that sentiment is beginning to shift.

First, there's the obvious: several companies that were Tech's proudest 'darlings' just a year ago are now looking a lot uglier. For instance, last month, Twitter's stock price was down nearly 65% percent from its year-ago high, and had dropped below its IPO price -- a shameful milestone for the former high-flier. It's CEO, Dick Costello, was ignominiously dumped; and after a much-criticized search for a replacement, the new CEO, Jack Dorsey, announced today that the company will be laying off 8% of it workforce, many of them engineers. Those who work in Silicon Valley will confirm that an engineering job has had about the same job security as academic tenure up to now. The fact that any company in the Bay Area, but especially a tech-bellwether like Twitter, is firing engineers en masse is a big discordant departure from the status quo here in Tech-land. If the engineers are getting cut, it's a sign that the senior executives are very, very worried.

But perception and sentiment aren't just about the numbers, they're about the vibe, the "feel" of things. What's being talked about in the hallways, at the trendy coffee bar, or voiced behind conference room doors. And the tenor of that vibe has suddenly become a lot more off-key.

During a recent gauntlet of industry conferences held in the Bay Area by the likes of Fortune, Re/code and Vanity Fair, the speakers' gave voice to a nervousness that's been absent during the past half-decade of bulletproof optimism:

We talked to a lot of these execs, as well as the quieter folks behind the scenes, at the events and the parties afterward, and a common theme shone through: Everybody agrees we're in a tech bubble.

 

At the Code/Mobile conference in Half Moon Bay, there was a lot of chatter about "on-demand" companies such as Uber, Postmates, and Instacart. These companies sprung up over the last few years to provide conveniences at the touch of a smartphone button to busy professionals with disposable income.

 

But investors are worried that these companies have been subsidized by easy VC money for too long.  In many cases, their customer and usage numbers are going up because they're using VC money to expand into new cities, but customer-acquisition costs remain high and many of them are bleeding money. Worse, mature markets like San Francisco and New York are starting to see some scary, weak customer-adoption numbers, which bodes poorly for these companies as they expand into other regions.

 

Basically the theory is that you can only sell a dollar for $0.75 for so long until you run out of money. That's going to happen at some point, and some investors believe a lot of these companies will vaporize.

(Source)

The invading gloom has been noticed by journalist Dan Primack, who has covered the venture capital beat for years:

The party isn’t entirely over, but you can hear someone shouting “last call.”

 

Every couple of months I leave my small Massachusetts town — where most people still shop for their own groceries and drive their own cars — and head for the Bay Area. Suddenly, all of my cynicism and bubble worries are drowned out by the kind of unfettered optimism that only $1 billion valuations (on $0.00 earnings) can buy.

 

But not today. Not this time.

 

Since landing in San Francisco on Wednesday, I’ve met with an assortment of senior venture capitalists, bankers, entrepreneurs and crossover investors. All of them have, in one way or another, been involved with so-called ‘unicorn’ companies. As in the past, they are nearly unanimous in sentiment. The difference now is that their sentiment is fear.

 

The past several years of raising too much, too high, too soon has run smack into a much more conservative investor ethos. Later-stage tech startups can still raise growth equity — and still lots of it — but not necessarily at the terms they were receiving just two months ago.

 

“This shift is only five or six weeks old, so most companies haven’t felt it yet,” a senior tech banker explains. “But I know of many companies who raised money at $1 billion valuations last year that are now being told that, to raise money now, they need to take around $700 million or $800 million. Probably with some serious structure that protects investors, like ratchets, on top of it.”

 

The reality is that record-high private market valuations have been driven by two things: Wall Street’s lust for growth at all costs, and relatively high tech multiples in the public markets (and, more specifically, applying the former to the latter). But a variety of macro economics factors (China, the inscrutable Fed, etc.) have cut public equity prices and moved the spotlight to unit economics, which means some pretty large biz model disruption for the disruptors.

 

Moreover, many of the crossover investors fueling these big deals were playing primarily for IPO optionality, and the successful VC-backed tech IPO has become few and far between. No longer are they willing to have terms dictated to them when the endgame seems so much less certain, and particularly not based on ambitious internal growth projections that would never be provided to the public in filings or on earnings calls.

(Source)

Nick Bilton, technology and business columnist for The New York Times takes it even further, decrying current valuations as "out of whack" and advising it's time for tech investors to "put your money in your mattress" to protect it from the coming carnage:

So sentiment is shifting, but it's early on in the process. Like a ball tossed in the air that reaches its apex, it reverses direction slowly at first, but then speeds up with rapid acceleration.

We are likely to see one of the great confidence-supporting memes of the past 7 years -- the unstoppable virility of our Tech sector as a jobs and capital gains engine -- unravel over the next year and a half. This in-turn will remove one more of the dwindling number of pillars supporting the 'master plan' our central planners have been claiming is necessary for stabilizing the global economy. 

Once the public's faith in Tech is shaken, how far behind will its faith in the Fed follow? How quickly will tolerance of further taxpayer-funded welfare programs for our big banks evaporate? Or of the cronyist revolving door between DC and Wall Street? Or of more policies that expand farther the wealth gap between the 0.1% and everyone else?

Change happens quickly once beliefs shift. As we continually advise here, make your preparations now, in advance, while supplies are still abundant and affordable.

Oh, and develop a taste now for unicorn meat. There's going to be a heck of a sale on it over the next few years.

 

 

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Wed, 10/14/2015 - 10:25 | 6666806 ghostzapper
ghostzapper's picture

A broader and more appropriate question:  how much are equities worth in a world without POMO and FOMO?

Wed, 10/14/2015 - 10:27 | 6666813 Winston Churchill
Winston Churchill's picture

10cents on the dollar.

Wed, 10/14/2015 - 10:36 | 6666843 TeamDepends
TeamDepends's picture

Well, the Berniebots are smoking SOMETHING.

Wed, 10/14/2015 - 10:45 | 6666863 HopefulCynical
HopefulCynical's picture

All that's really required, at this point, is for the FED to pevent the big selloff from actually occuring. And since they have unlimited $$$ in their printing press, I'd put their odds of successfully doing so at about 95%.

Once it is obvious that the market will not be allowed to go down, the money will have to come in on the long side, or sit on the sidelines being eroded by the *real* inflation that is the result of FED activity.

The whole point of this is to suck in as much of the remaining retail money as possible.

There will be a crash, but not until we've been off to the races one last time, to suck the last of the naysayers into getting long.

And that crash, as has been predicted by many people here, will not be a short-selling opportunity. It will be a shutting down of the exchanges and a "sorry folks, show's over. Everyone go home." And it won't just be in America. It will be everywhere.

And then, the banksters own the world (at least in their minds) because they will have legal title to all of it. Every country in the world will be in tatters, but the banksters will claim the rights to all the resources - including (and especially) FOOD. This will (they believe) enable them to recruit the horde of mercenaries they will then use to force their will upon the whole of the Earth. They can feed you & your family; all you have to do is put on these jackboots and round up (or kill) whoever they tell you to.

Yeah. As things are going, that's what lies ahead.

But it isn't here yet.

One more big, stupid hurrah. One last time across center stage - with JAZZ HANDS.

Then - kablooie.

Wed, 10/14/2015 - 10:48 | 6666875 LawsofPhysics
LawsofPhysics's picture

Don't overthink this.  Allow me to simplify; Global Weimar.

Any questions?

Wed, 10/14/2015 - 10:54 | 6666899 o r c k
o r c k's picture

What is the appropriate justice for those who bring down a civilization due to greed?

Wed, 10/14/2015 - 11:04 | 6666953 LawsofPhysics
LawsofPhysics's picture

Depends.  Do you have a functional justice system or not?

 

Wed, 10/14/2015 - 11:07 | 6666967 847328_3527
847328_3527's picture

Is there an app for that?

Wed, 10/14/2015 - 12:24 | 6667311 The Polish Hammer
The Polish Hammer's picture

iSell

Wed, 10/14/2015 - 11:09 | 6666980 DutchR
Wed, 10/14/2015 - 11:20 | 6667026 TeamDepends
TeamDepends's picture

They?

Wed, 10/14/2015 - 13:47 | 6667610 Vampyroteuthis ...
Vampyroteuthis infernalis's picture

I disagree with the PPT at all costs. The big boys will crash it on purpose while they are short. Make the big bucks then the money printers will fire up!

Wed, 10/14/2015 - 12:30 | 6667337 HopefulCynical
HopefulCynical's picture

There is no over-thinking. This is the result of decades of watching, and allowing my observations to work, unhurried, in the back of my mind, aided by my intuition, which has become rather accurate.

Disbelieve me if you wish, but I am fairly certain this is how things are going to play out over the next few years.

One last shake out, to embolden the bears and appear to signal what those of us who understand reality have been expecting for some time now.

Then one last rocket ride, to confound everyone, and suck in all the sideline money possible.

Then...boom. The world owned by "fee simple."

Centuries of planning, being brought to fruition.

Wed, 10/14/2015 - 17:44 | 6668779 LawsofPhysics
LawsofPhysics's picture

Well, if that is true, then the average standard of living will drop, big time in the U.S.  That's just math and physics.  Personally I see more of a Soviet Style slide into idiocracy.  I have done business in Russia for quite a while and would visit often.  It was always funny to go into government-owned places and laugh at the "official" prices of things.  Basically the item was simply not available, or you could walk around the corner and get it for a few percent of the "official" price if you had physical cash.

Wed, 10/14/2015 - 18:27 | 6668930 Oldwood
Oldwood's picture

It is not about how high the market is, it is about how high does it need to be to suck the external sideline money in? This is why they are using their own money as well as debt to ramp the market. Its like Huckleberry Finn whitewashing the fence and bragging about how great the work is until he induces other "manipulated to envy" participants. Or maybe Brer Rabbit begging the wolf to not throw him into that there briar patch. In any event, people are being manipulated, indoctrinated, and frightened for loss, to get into the markets, either for greed, but more recently for wealth preservation. We may as well be going to the Don for protection and then complaining of being robbed.

To the point you make, the question as always is when. If you believe they will hold until they have control of every last dime, you may be right in that it will be a while longer. But if they come to believe that a certain percent (I being of that group) will NEVER participate, then what? I think we may be there. Like any hedge fund knows, they can't hold their position forever. They will still have to calculate for the best return against losing control. AS long as they THINK they have control, it is likely to last a while longer...they can afford to wait. BUT...if shit starts coming loose, China, Russia or something else starts to fuck with our "confidence" (which IS the controlling factor), then they may well dump and run. Its not like they will suffer much....not having it ALL.

Even they can be pragmatic.

Wed, 10/14/2015 - 17:41 | 6668783 SILVERGEDDON
SILVERGEDDON's picture

Even nipples have heads. Disneyland tech booble ?

Not so much.

You can't eat a Twitter, or a smart phone. 

Party on, bitchez.

I'll tend to the garden, and keep the Dillon humming.  

Wed, 10/14/2015 - 19:27 | 6669133 Lorca's Novena
Wed, 10/14/2015 - 10:29 | 6666809 Fukushima Fricassee
Fukushima Fricassee's picture

The media and the FED will protect Zippy the magic queer to thier last breath. Then we will see what Jewwant to see.

Wed, 10/14/2015 - 10:31 | 6666817 Rainman
Rainman's picture

Can't wait until the ad buyers finally discover that robots are doing most of the clicking ... woohoo !!

Wed, 10/14/2015 - 10:48 | 6666876 vq1
vq1's picture

and website owners that stack ads ontop of ads that are all registered as "seen by a human" even though only 1 is. Also 1x1 pixel ads hidden all over the site that are also registered as "seen by a human"

 

God how easy it is to make money off these old school, print-handicaped, marketing farts that still have aol email accounts. 

 

Wed, 10/14/2015 - 10:32 | 6666827 Dr. Engali
Dr. Engali's picture

The mattress is one place, I prefer to store my money at the bottom of the lake. 

Wed, 10/14/2015 - 10:49 | 6666884 vq1
vq1's picture

im going fireproof safe. Its secure with the exception of civil forfeiture

Wed, 10/14/2015 - 10:34 | 6666831 LawsofPhysics
LawsofPhysics's picture

Pushing fucking paper adds nothing of real value to the real eCONomy.

High time bankers and financiers had to do real work and deal with real risk again!!!

No more free money, no more bailouts.  Jump you fuckers or face the fucking guillotine!

Wed, 10/14/2015 - 18:57 | 6669034 Oldwood
Oldwood's picture

There are two games....well, actually only one is a game.

A person can work and possibly labor to create things of use that they and others will place value in. And then there are those who seek to prosper from other people's labors. They are the redistributors who through various means, from direct force through arms or force of law, or through manipulation and trickery, move your hard earned money into their pockets. Government and outright criminals use the former, and big business and financial types use the latter. It is as it has always been. Our job has always been to resist both force and manipulation. It ain't easy, but them is the rules.

Be strong and smart, choose the fair trade over something for nothing, and keep your eyes open. Government, criminals and slippery fucks will all tell you to trust them, that they care about you, that they can make it "EASY", only to find that you are the filling for their pie.

I'm pretty sure you can tell the road that leads to hell, as it is likely the best paved one.

Wed, 10/14/2015 - 10:33 | 6666832 pods
pods's picture

Sign of the times with cheap money flooding everything that is thought to give yield.

Just like housing has been a place to launder international money flows.  Blackrock bought the house next to mine. WTF?

Can't wait till Mr. Yellen raises rates.  If you thought the last stroke out was bad, you ain't seen nothing yet.

pods

Wed, 10/14/2015 - 10:36 | 6666842 WillyGroper
WillyGroper's picture

BRK in real estate big time in my region.

Wed, 10/14/2015 - 10:42 | 6666855 pods
pods's picture

My thought was they are laundering Chinese money. I can see buying office parks, but single family units?  Goes to show you how much phoney capital is chasing yield.

pods

Wed, 10/14/2015 - 10:44 | 6666867 Tom Servo
Tom Servo's picture

same here, central florida, fuckers...

 

Wed, 10/14/2015 - 10:53 | 6666897 vq1
vq1's picture

can you blame them? If I were wealthy in China Id flee to the "promised land" too.  

 

Ah, how globalization has brought the elite all together, regardless of ethnicity and culture. 

Wed, 10/14/2015 - 12:20 | 6667294 MoHillbilly
MoHillbilly's picture

You sure it was Blackrock? It could be Blackwater, which means they are on to your ass, get out while you can

Wed, 10/14/2015 - 10:36 | 6666838 Kaiser Sousa
Kaiser Sousa's picture

unicorn meat...

thats funny.

 

sorry nothing material to add for the moment.

Wed, 10/14/2015 - 10:43 | 6666857 Ignatius
Ignatius's picture

Tastes like chicken.

Wed, 10/14/2015 - 11:44 | 6667139 TBT or not TBT
TBT or not TBT's picture

There's also a sort of soylent je ne sais quoi going on in there too.  

Wed, 10/14/2015 - 10:39 | 6666848 Normalcy Bias
Normalcy Bias's picture

And it's no secret that I think it's degenerated into a steaming pile of hucksterism.

Reminds me of my year in grad school when I would constantly think, "My God, some day peoples' lives are going to be in the hands of these lying, cheating idiots."

Wed, 10/14/2015 - 10:46 | 6666870 Duc888
Duc888's picture

 

 

Most of the "tech" that could help the genpop out of this mess is kept under lock and key.

Wed, 10/14/2015 - 11:45 | 6667150 TBT or not TBT
TBT or not TBT's picture

Like the impervious car paint they've been holding back for decades now, and free energy.   

Wed, 10/14/2015 - 13:12 | 6667488 VWAndy
VWAndy's picture

Or the 100 mpg car?

Wed, 10/14/2015 - 13:48 | 6667517 VWAndy
VWAndy's picture

Watch how fast tptb regulate the 3d printing of cars and stuff into oblivion.

 

 My guess is they nip it in the bud before I can finish mine off and send it off to the printer.

Wed, 10/14/2015 - 10:47 | 6666872 highly debtful
highly debtful's picture

I'm thinking there are a lot of new elements to be discovered in the next few years: hopium, unobtainium, wishfulthinkium...

Maybe there's a brand new Nobel prize just waiting to be awarded in the novel field of financial chemistry.

Wed, 10/14/2015 - 10:50 | 6666887 yogibear
yogibear's picture

Nothing a good dollar currency crisis won't fix.

The Federal Reserve PhDs will panic when it occurs, when they finally lose control. 

 

Wed, 10/14/2015 - 10:51 | 6666892 MedicalQuack
MedicalQuack's picture

Documentary, Dreams of the Silicon Valley..good video and shows how "out there" the get and thought proceses

http://ducknetweb.blogspot.com/2015/03/cybertopia-dreams-of-silicon-valley.html

 

Wed, 10/14/2015 - 10:52 | 6666893 the grateful un...
the grateful unemployed's picture

just curious whatever happened to B2B?

Wed, 10/14/2015 - 10:58 | 6666921 Pumpkin
Pumpkin's picture

IT IS NOT A SHAM!  It is a scam.

Wed, 10/14/2015 - 11:04 | 6666955 Dr. Engali
Dr. Engali's picture

It's a scamwow.

Wed, 10/14/2015 - 11:56 | 6667195 Pool Shark
Pool Shark's picture

 

 

"It's a travesty of a mockery of a sham of a mockery of a travesty of two mockeries of a sham!"

Wed, 10/14/2015 - 11:12 | 6666991 MadVladtheconquerer
MadVladtheconquerer's picture

I had some unicorn meat once.  Brisket.  Tastes like chicken.

 

 

Wed, 10/14/2015 - 11:33 | 6667095 Archive_file
Archive_file's picture

I live in my van in San Francisco and deliver food for one of the many delivery services here. Been doing it a couple of years. I go into the offices of these tech companies and boy what do I see?! Top shelf booze, million dollar bay views, everyone is under 30 years old and has dyed their hair pink, blue, or wears a mohawk. In the evenings I deliver their food to their extremely expensive condos. It's all one big joke. Having landed their first "job" after graduating from some Ivy League, they strut around town at 23 years old as if they were god's gift to the universe. I hope the whole thing comes crashing down. You wanna see one of the most stupid concepts/companies? When ever I see their ad on a bus I just wanna gag: www.ifonly.com

Wed, 10/14/2015 - 11:47 | 6667159 TBT or not TBT
TBT or not TBT's picture

No rivers in San Fran to park down by. Good move.  

Wed, 10/14/2015 - 13:08 | 6667472 Archive_file
Archive_file's picture

I just park it on Fulton Street. I've got a hitch for my scooter. I move the van once a week. I work 7 days a week and gross about $200 a day. I'll take my bicycle out for a lunch shift 3 days a week for the cardio. Since I don't pay rent, I put about $500 a week in savings. Yeah, I'm a total scumbag, but what else am I going to do, pay $3500 a month rent? I'm a 44 year old college grad and Army vet. No kids thank god.

Wed, 10/14/2015 - 14:12 | 6667704 Skateboarder
Skateboarder's picture

Sir, as a gruntworker with his eyes open and not in the "startup" charade, and especially as one who gets to see the innards of these places, you understand too damn well firsthand the gayness of the reality of the situation in the SF Bay Area. See my comment below for a perspective from the South Bay.

Wed, 10/14/2015 - 17:51 | 6668808 TahoeBilly2012
TahoeBilly2012's picture

Tahoe is just as bad...those clowns have over run the place.

Wed, 10/14/2015 - 18:58 | 6669041 Archive_file
Archive_file's picture

It's really insane. I go to the top floors of the Transamerica building which is occupied by high finance businesses and what do I see? White, Ivy League young men who can't even shave yet sitting in darkened vaults peering at charts on computer monitors. Fuck that. It's all so they can say they have a San Francisco zip code, completely oblivious to the manipulation their companies do to government and society through hypercapitalism. What blows my mind is that no one is asking any questions. I guess you learn to shut up when you get a 6 figure salary. It's a veritable shit show.

Wed, 10/14/2015 - 19:37 | 6669163 Lorca's Novena
Lorca's Novena's picture

Hats off to you man! These kids have no effing clue what awauts them once they "lose" their job, stock options, health ins, everything. I may be the first to punch their faces in once they show up asking me for work some day.

 

Spent some time in Hipsterville (los angeles areas) and what a bunch of pansies. Anyways hang tough man.

Wed, 10/14/2015 - 19:51 | 6669201 Archive_file
Archive_file's picture

It's rediculous. It was a culture shock when I first pulled up. I've never actually seen a real nannie or house servant before. Occasionally I drop off food to certain houses and actually get greeted by a usually Hispanic older female Nannie/servant. I really felt like a country bumpkin. SF isn't even a real city. It's a snow globe.

Wed, 10/14/2015 - 12:21 | 6667287 LawsofPhysics
LawsofPhysics's picture

The "best and brightest" figured out long ago that all their student debt, just like the .gov, will never be paid back!

Good luck to them when the food providers no longer accept their credit. 

 

LOL!  that company is selling "wealthy experiences" in the bay area to the wealthy.  Fucking halarious, but I bet they do well.  Massive resource and capital mis-allocation, but what the fuck do you expect in a NIRP world with "mark to fantasy" accounting?

Thu, 10/15/2015 - 03:39 | 6670035 kappal_toba_dhu...
kappal_toba_dhurr_ne_thook's picture

Excellent post!  What you wronte struck a chord!  My husband, an IT pro, was laid off after 45 and was out of work for nearly 2 years.  He finally found a job with 60% of the pay and no pension.

His next company was about what you described above (except for the hair color).  He was the second oldest person there (the oldest was the owner).  Of course they only hired him to learn his skills, after which he would be cast out like a used condom.  Long story short, we got a chance to leave and come to Singapore and so we emigrated from USA.

IT, finance, and many other "hot" jobs are anything but!  Young people who plan to go into these areas had better get filthy rich by the  time they are 35 or else have skills they can use elsewhere.  God help these fools!

 

 

Wed, 10/14/2015 - 11:56 | 6667192 MoHillbilly
MoHillbilly's picture

Hey Adam, My mailman told me Apple will double in the next 2 years because everyone needs a phone so FUCK YOU

Wed, 10/14/2015 - 12:05 | 6667237 VWAndy
VWAndy's picture

 No! Helicopter money will save us all. Thats the new line of smoke being pimped now.

 All across the the spectrum its being spoon fed to the masses. And they eat that shit up. Anything other than doing actual productive work.

 This is the reason I think the stall is the only way out of this mess. Nobody is going to be getting off the gravy train while its still moving. They will ride it right into the abyss dancing and singing all the way.

 When one looks at just how many are riding this gravy train its comical. Government notworkers, Nonedgucators, Injustice providers the list of cats working to the opposite of the stated goals is massive. All those whos living is made thru force or fraud. May they all burn in the fires they started. 

 The other good option is to set fire to the gravy train while its moving full speed.

 News flash! Superman aint coming.

 

Wed, 10/14/2015 - 12:19 | 6667292 homiegot
homiegot's picture

This is a Ponzi scheme.

Wed, 10/14/2015 - 12:43 | 6667387 homebody
homebody's picture

Next gated economic zones, more gated communities, more gated privileged cities, .... all with imported servants to do the child care, lawn care, food prep, and blow jobs.

 

When do we working people stop paying these new caesars.   

 

Wed, 10/14/2015 - 12:51 | 6667411 LawsofPhysics
LawsofPhysics's picture

When you stop accepting their paper/digital promises and giving them the fruit of your labor (be it a blow job or otherwise)!!!!

NOTHING changes otherwise.

Wed, 10/14/2015 - 12:56 | 6667433 VWAndy
VWAndy's picture

 Barter should work great for the productive.

 

 

Wed, 10/14/2015 - 12:52 | 6667417 VWAndy
VWAndy's picture

Thats the way honest folks need to start looking at this shitshow.

 Its the honest work that makes it all go.

 

Wed, 10/14/2015 - 13:59 | 6667647 Skateboarder
Skateboarder's picture

Life in SF Bay Area from a real engineer's perspective:

Long-standing, reputable small business in product design: Make real things you can hold in your hands, almost always never done/made before - architect, design, prototype, test, refine, qualify, and go to production... hardware and interconnect, mechanicals and enclosures, firmware and programmable logic, bring-up & diag & mfg utilities, firmware & PL logic updaters, host application software, daemons, GUIs... you name it.
Rewards:
satisfaction of doing good, honest work, and enough payout to lead a middle class life (owners included).

 

App/Website "startup": take a bunch of pre-assembled pieces of high-level software, slap it together to form an app or website, fetch some VC funding, get an SF / Mountain View / Palo Alto office, and go to IPO.
Rewards: Shitloads of money, upper middle (for the minions) or rich class (for the owners) life, and an endless supply of benefits, free shit, and ego-strokery.

 

In this world, real, honest work almost always pays a pittance, unless you figured out a nice little niche. There aren't too many of those nice niche jobs though.

Wed, 10/14/2015 - 14:05 | 6667682 VWAndy
VWAndy's picture

Yep

Wed, 10/14/2015 - 17:58 | 6668832 LawsofPhysics
LawsofPhysics's picture

Yes, meanwhile the bankers and financiers get their money for free, loan it to you, then stand there behind their bought-and-paid-for government and say "fuck you, pay me".

 

Wed, 10/14/2015 - 19:55 | 6669217 Really20
Really20's picture

100% true. The "startup scene" in the Silicon Valley is caustic and inimical to real innovation. It's just a means of keeping money flowing to the richest of the rich and feeding an over-inflated property market that has priced out even the "engineers".

Real innovation comes from scientific research and technological development, not from creating yet another way to socially network. Silicon Valley's "innovation scene" won't build a Moon base, develop nuclear fusion, or cure cancer. Yes, the Bay Area has a research establishment that does all of these things, but it is deeply underfunded and ridiculed in comparison with the nearly useless "startup scene".

Wed, 10/14/2015 - 13:19 | 6667511 Mick Shrimpton
Mick Shrimpton's picture

Short San Francisco real estate.

Long hacker organizations.

Wed, 10/14/2015 - 13:25 | 6667535 VWAndy
VWAndy's picture

Identity theft should keep the tech sector afloat for a bit longer.

Wed, 10/14/2015 - 13:34 | 6667576 tommylicious
tommylicious's picture

FUCK YOU, DOT COM 2.0-ERS!!!!!!!   BASTARDS!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Wed, 10/14/2015 - 13:43 | 6667598 Zero-Hegemon
Zero-Hegemon's picture

There is no greater sadness than throwing away unused unicorn parts. Until we learn to how utilize every part of the unicorn, nothing will change.

Wed, 10/14/2015 - 13:54 | 6667631 scatha
scatha's picture

This is all hype nothing more.

Much less polite but much more accurate characterization of the dying (ideas) of Silicon Valley and incoming collapse  I read ten months ago at:

https://sostratusworks.wordpress.com/2015/01/08/smell-of-silicon-madness/

Wed, 10/14/2015 - 14:41 | 6667857 wisebastard
wisebastard's picture

here is some more trolling from the keyboard warriors at zerohedge...............what punk bitches..............i bet they are fucking pedophiles like the NSA agent across the steet...........................

Wed, 10/14/2015 - 14:44 | 6667876 VWAndy
VWAndy's picture

LoL

Wed, 10/14/2015 - 17:33 | 6668756 buzzsaw99
buzzsaw99's picture

Once the public's faith in Tech is shaken, how far behind will its faith in the Fed follow? How quickly will tolerance of further taxpayer-funded welfare programs for our big banks evaporate? Or of the cronyist revolving door between DC and Wall Street? Or of more policies that expand farther the wealth gap between the 0.1% and everyone else?

The public? You're fuck shit kidding, right? The public has zero power or desire to change anything.

Wed, 10/14/2015 - 18:54 | 6669027 polizeros
polizeros's picture

Maybe the point of some VC "investing" has nothing to do with whatever shiny useless web widget is being hyped as the next disruptive innovative thingee.

Instead, maybe it has quite a lot to do with making dirty money clean. If so, a loss on funding a startup becomes a squeaky clean tax deduction. If the company prospers, then so much the better. But perhaps whether or not the startup makes money is irrelevant.

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