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Are We In Another Tech Bubble?

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Tech bubble or not, this guy delivered the "Quote of the Day" with this zinger:

“Saying we’re not in a bubble because it’s not as high as 1999 is like saying … Kim-Jong-Un is not evil because he’s not Hitler,” Gurley, a partner with big-name VC firm Benchmark Capital, told WIRED during a recent sit-down at his San Francisco office. “It doesn’t have to match 1999 in order to be madness.”
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Multi-billion dollar acquisitions of companies that haven't yet released a product, or that make a phone app, or otherwise don't have the income to justify the price tag are a pretty good indication of a bubble.
 
Are we in a bubble? Yes and no. Yes because prices are inflated, no because unlike last time this tech actually has a market. Does that mean these companies will ever make a profit? No, however the market exists. This isn't a repeat of .com mania, there is actual technology being created.
 
Over extended evaluations of games. I mean.. the make of minecraft selling for 2.5 BILLION. Another company recently IPO'd at like 10 BILLION. The numbers flying around are insane.
 
jfreund said:
Multi-billion dollar acquisitions of companies that haven't yet released a product, or that make a phone app, or otherwise don't have the income to justify the price tag are a pretty good indication of a bubble.
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Yup, it's a sign to watch for.

That qualifies as some serious speculating in my book, dangerous stuff when to many companies start these buying sprees. There still seems to be a lot of money in the pot, but people may be a lot more "trigger happy" than they were in 1999 if things start going bad. Add in thousands of trading bots in the mix and it can be quite the powder keg.

Better have a good trading strategy in place if this happens.
 
Grimlaking said:
Over extended evaluations of games. I mean.. the make of minecraft selling for 2.5 BILLION. Another company recently IPO'd at like 10 BILLION. The numbers flying around are insane.
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But minecraft is making money, granted not billions, but it was more buying into a platform, not a game. Alibaba is more into buying into China. Both have clear cut purposes, unlike how it was during the housing/90s tech bubble where towards the end, people were buying because everyone else was buying.
 
There is a consequence to the Federal Government's borrowing a trillion dollars a year from the Chinese. Our economy cannot sustain that kind of spending and by borrowing that much money and injecting it into our economy we are artificially inflating prices on everything.

In 2008 John McCain wanted to freeze Federal spending. Had we pursued that course of action the economy would have floundered for several years but eventually we would have emerged stronger and more stable economically speaking. Instead 0bama and the liberals borrowed an obscene amount of money without addressing the underlying economic fundamentals. It's going to get ugly...
 
thejokker said:
There is a consequence to the Federal Government's borrowing a trillion dollars a year from the Chinese. Our economy cannot sustain that kind of spending and by borrowing that much money and injecting it into our economy we are artificially inflating prices on everything.

In 2008 John McCain wanted to freeze Federal spending. Had we pursued that course of action the economy would have floundered for several years but eventually we would have emerged stronger and more stable economically speaking. Instead 0bama and the liberals borrowed an obscene amount of money without addressing the underlying economic fundamentals. It's going to get ugly...
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don't act like it's a democrat issue... the republicans are just as addicted to cheap money
 
One one hand I agree but on the other hand the world is very different compared to 1999. Then it was mostly the tech savy that bought things online and we had huge flops in my country like boo.com that wanted to sell clothes online and no one was interested despite massive marketing. These days we do buy things online and more and more is being bought online. Now everyone uses the internet all the time, not a few nerds with dial up. Much of the world barely had internet in 1999, Now people even the poorest countries have internet on their cheap android phones or €$50 tablets. Many compaines were ahead of the times in 1999 but now we truly live online 24/7
 
Romale23 said:
I think we are in an everything bubble and tech is in a better position than any other sector...
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Amen.

Consumer economy is entirely dependent on bubbles. People have to believe that new stuff is always worth more than old stuff.
 
Ryokurin said:
But minecraft is making money, granted not billions, but it was more buying into a platform, not a game. Alibaba is more into buying into China. Both have clear cut purposes, unlike how it was during the housing/90s tech bubble where towards the end, people were buying because everyone else was buying.
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I would be scared of owning Alibaba. Bubble all over this one.

"The bigger concern is that, because China's government restricts foreign ownership of Chinese assets, Alibaba shareholders won't actually own the company. Instead, through a so-called variable interest entity (VIE), they will only own shares in a shell company with a contractual claim on Alibaba's profits."

http://online.wsj.com/articles/alibabas-political-risk-1411059836
 
I cant believe people are obsessing over alibaba and minecraft, 2 companies which actually make money in all likelihood. How about whatsapp or others that people way over paid for and do make nothing but a product that is completely redundant with every other messaging platform since ICQ
 
m heisty said:
Are we in a bubble? Yes and no. Yes because prices are inflated, no because unlike last time this tech actually has a market. Does that mean these companies will ever make a profit? No, however the market exists. This isn't a repeat of .com mania, there is actual technology being created.
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Right. And people use "tech" as a buzzword, but it's amazingly diversified compared to the .com bubble.

Uber is considered tech, but really it's transportation. Square and Bitcoin is considered tech, but really it's financial services. Whatsapp is considered tech, but really it's communications. (Ok, maybe that was a bad example ;) ).
 
It's a bubble alright, but it's going to be even bigger. Computer stuff is just now starting. Plenty of ovens, refrigerators, and potato chips still don't have fb, twi, g+ accounts.
 
if snapchat is valued at 10 billion then yes we're in a tech bubble, many of these companies only have value because some other company might, just might buy them, that sounds like a ponzi scheme to me or a bubble
 
It's madness.

Then again, there are many people whose entire lives revolve around bullshit like twitter, snapchat, etc. "Social media" and "apps" that add oh-so-much value to the progress of mankind.

Either it's a bubble and we're in serious trouble, or people really think this garbage is valuable and we're in serious trouble.
 
dagas said:
One one hand I agree but on the other hand the world is very different compared to 1999. Then it was mostly the tech savy that bought things online and we had huge flops in my country like boo.com that wanted to sell clothes online and no one was interested despite massive marketing. These days we do buy things online and more and more is being bought online. Now everyone uses the internet all the time, not a few nerds with dial up. Much of the world barely had internet in 1999, Now people even the poorest countries have internet on their cheap android phones or €$50 tablets. Many compaines were ahead of the times in 1999 but now we truly live online 24/7
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Boo's problem wasn't marketing, it was burn rate ($188 million in six months per Wikipedia) and building a site that even the best computers at the time struggled with. If the problem was that people didn't trust buying things online in the 90s then how did Amazon make it?
 
Diversity doesn't stop something from being a bubble. A bubble happens when people over pay for shit and will never get a return on their investment. This eventually leads to a crash when the truth becomes apparent and the bubble cannot sustain its expansion. When you see 23 billion dollars changing hands over a messaging app like ICQ with no way to make money you damn well know google nor anyone else is ever going to break even on that deal especially not when its going to easily be eclipsed by the next flavor of the month messaging service. That is not one bit different than all the junk that happened during the dot com bubble when everyone thought they could make big bucks just by having a web site. Now days lol everyone thinks you can eventually become google if you just have any sort of customer base. News flash the opportunity to become google or apple happens once in a quarter of a century it wont happen again for these companies.
 
spintroniX said:
don't act like it's a democrat issue... the republicans are just as addicted to cheap money
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Large numbers of people are addicted to spending someone else's money on social services to the point they are spending our children's future to do it. And a significant number of people are addicted to receiving the benefit of that generosity at someone else's expense. And our current crop of politicians on all sides will pander to those two groups.
 
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