Need to buy a house? bid 20% more than asking, if you don't - someone else will.. in cash.

Need to build a ride-hailing app? prepare to pay people to ride indefinitely.

Need to own a growth stock? prepare to pay upwards of 100x multiple on revenue.

All around, there have been too many dollars chasing too few assets. I suspect the pendulum is swinging now that housing got to the price point where employees demanded equivalent pay increases to housing cost increases.

There's a lot of money, but also not enough concentrated in one spot to do really useful ventures like large infrastructure projects. So instead the money is distorting everything.

Imagine if lending was less cheap for home owners but it was still cheap for governments or really large companies to be able to build train lines or advanced manufacturing or affordable medium density housing.

I see the problem as too much credit is able to be spent with too little focus. So silly stuff is being funded because the money is becoming meaningless.

non-productive Speculative investments tend to get punished at the end of the cycle by losing all value, thus punishing those invested in it and restoring order. But that often only happens when you increase interest rates above that which productive investments like solar power plants often need. And so you get contraction as even the productive investments are starved of funding. Oh well, at least the solar power plant hasn’t lost all its value.

To be precise, the investors who are left holding at the end of the cycle get punished. The early investors who got out make out like robbers.

This system incentivizes pump-and-dump.

We could allocate resources to productive assets by fiscal spending, but that is prevented by politics. Only when "the market" gets its cut can any infrastructure be built in the US. That's also true for much of the medical establishment and pension/retirement systems. If the market was efficient, we wouldn't be complaining about it. Unfortunately, a "free market" and an efficient market (and you could argue whether infrastructure or medicine or income insurance even make sense as markets) are not the same. Most markets that have many individual consumers require regulation to be even close to efficient. Like political and financial enforcement they are too easy to manipulate and the consequences of malfeasance are substantially less than the profits to be made.

So you need a smart balance. And you need competent, honest people in both business AND government.

I don’t think that government necessarily is inefficient. The DMV could be a very efficient place. The fact that it isn’t should cause at least some pause for those advocating more government spending (such as myself).

And the same is true for business. Comcast is terrible. But it doesn’t HAVE to be. Rent-seeking and anti-competitive behavior makes it terrible.

The problem with the above is it weakens democratic institutions by removing the exercise of power from the people the population select to lead.

Inefficiency to me can not possibly be more clearly demonstrated than by ape pictures losing hundreds of thousands of dollars for their purchasers. But we also have examples like Uber spending cash on hand to drive competitors under without having a plan to maintain their own services without heavy subsidy.

I sold a car of mine to Carvana in October. I returned the license plate to the DMV immediately, which is how they're notified that you no longer own the vehicle, waited 7 days, then cancelled my insurance policy on that car. A month later, I got a letter from the DMV that it is a crime to not carry insurance on my vehicle and I will have to reinstate the insurance and pay a $70 fine for letting it lapse. On the car I no longer own, that was now titled in another state and resold by Carvana already.

It took 2 more months and 3 different forms to get the DMV to accept that I no longer owned the car and to stop pursuing me for this "crime".

Sounds like your state has a big problem.

In my state (New York), appointments are generally available within a week and walk-ins are welcome, but those with appointments get priority.

I've never spent more than 30 minutes or so at a NY DMV location and most transactions are available online, including replacement of lost/stolen licenses.

In fact, I decided on Wednesday (11 May 2022) that I wanted to trade in my license for an "Enhanced Driver's License"[0] (EDL) which, among other things, will be required for domestic air travel[1] in a year or so.

That's one of the few transactions that must be done in person. I went online to book an appointment and was presented with a whole bunch of appointment times next week. I chose Thursday (19 May 2022) as it worked best with my schedule, but I could have gone on the 16th if I'd wanted.

So, no. Not all DMVs are a pain or inefficient. Want to make that better in your state? Elect people who will work for you. Just a crazy thought.

[0] https://en.wikipedia.org/wiki/Enhanced_driver's_license

[1] https://en.wikipedia.org/wiki/REAL_ID_Act

Yep. Which is why I said:

   ...I wanted to trade in my license for an "Enhanced
   Driver's License"[0] (EDL) which, *among other things*,
   will be required for domestic air travel[1] in a year or 
   so.

I suppose I could have clarified that the EDL provides RealID and additional functionality as you describe, but I figured that "among other things" and links describing both RealID and EDL, folks could find out for themselves what "among other things" meant.

Perhaps that overestimates the reading comprehension of some folks, but I prefer to give people the benefit of the doubt and not assume they're morons.

Perhaps that's a mistake, but if so, it isn't my first and won't be my last.

I thank you for clarifying and I'm sure the morons out there will thank you for your pedantry as well.

I'd further point out that this was just a real-life example of a service which must be provided in person and not online and my experience with scheduling an appointment. It could just as easily have been any of several different services which require actually going to the DMV, but that's the one that is relevant to my life at the moment.

As such, even if I'd claimed that an EDL gets me free blowjobs at Federal buildings, I still made the point I was attempting to make.

Edit: Clarified my prose.

The license plate should follow the car and ownership should be changed online as part of the transaction. It sounds incredibly wasteful that every time a car changes ownership the seller must hand over the plates in person to the DMV. And is there no national registry of cars or data sharing between states? Strange that a car can be registered twice.

If your drivers license is stolen you should be able to just order a new one online and have it delivered in the mail. I have been inside the building of our DMV equivalent two times. One time when I did theoretical exam to be allowed a practical driving test, and once for the driving test. I got a temporary license when I passed and the proper license in the mail the next week. This was 20 years ago.

You can do a lot of stuff electronically in my state, transferring a title isn't one of them.

Additional fun thing is that the buyer is supposed to go do that and it can cause the seller headaches if they don't.

It's not sabotage, it's the fact that the government wants a leash on you. I had an experience in the past with the CA DMV where simply forgetting to "de-register" a broken, non-functional motorcycle resulted in the state levying my bank account for hundreds of dollars in registration fees. The FTB had the money debited right out of my account, no different than if someone committed wire fraud.

If a license is stolen, You need to go into the DMV because they'll have to take a new photo. There was a temporary exception due to COVID, but I think that's no longer available since I had to go into the office when my license expired.

There's too many personalized plates and other exceptions in the US to make that viable.

We bought our last family car from enterprise and one day this family walked by while my mom was waiting for me in the store parking lot. The kid recognized our car as a rental they had on a road trip once and got excited about it. Awkward. xD

Custom plates are weird. You can either give them to the new owner or transfer them to another vehicle or return them to the DMV.

This whole "turn in the plates or we'll go after you for not having insurance" seems completely insane. I've never turned in plates and no one's cared.

https://www.dmv.ca.gov/portal/handbook/vehicle-industry-regi...

Some plates have retention fees, some don't. YMMV.

Now I do chose the office to visit with some care, and also (as an "elite WFH software engineer") time it so that the lines are likely to be shorter, so YMMV.

Rather, there's an online form for notifying them of a sale.

If they have a better mousetrap, good for them. If they don’t and are just overpaying for cars, well, good for me.

In California the DMV experience was greatly improved by having appointments, and for walk in, you get a number and at least have an idea when you'll be called, so you can sit in a waiting area, not have to stand for hours.

COVID has reduced staffing so that makes appointments harder to get.

Also, imagining that corporate offices are models of efficiency is an error.

Absolutely!

I used to work for a Fortune 50 company (that shall remain nameless here) and was moving various groups (mostly marketing and research) away from mainframe batch processing (this was the mid 1990s) toward distributed (Unix) systems.

The inefficiency and waste were just unbelievable. The corporation had tried to move their customer service reps off IBM 3270[0] terminals which were locked in to a single application (with significant retraining required for different apps) with X terminals (what they used to call thin clients) that scraped database queries and stored them in a local database and had a unified UI across all apps.

The app was complete, the roll out team purchased ~USD$300,000,000 worth of systems and infrastructure, and then realized that it would cost USD$150,000,000/year to support/maintain the environment.

So the project was canceled, with hundreds of millions of dollars in Unix boxen and related hardware sitting in warehouses, now without a clear purpose.

When moving folks off of the mainframe, we always pushed them to use the hardware already purchased (a sunk cost). All a group needed to to was put the capital depreciation for whatever equipment they used on their budget lines.

The vendor (again who will remain nameless) priced out equipment (on purpose, I'm sure) so it was cheaper (on the budget line) than the depreciation on the equipment the corporation already owned. In every single case, these groups chose to spend real money buying new equipment rather than taking on the depreciation of the equipment already purchased.

What's more, when evangelizing these changes, I was strongly cautioned to never use the phrase "increased productivity," as that (apparently) made the heads of these groups concerned about losing head count.

tl;dr: The corporation was so fractured and inefficient that group heads would waste corporate dollars in the millions just to maintain their budget and headcount.

I'd love to hear about something like that happening at the DMV or other government office. But I won't, because if folks in the public sector pulled shit like that, they'd be hounded out of their departments.

[0] https://en.wikipedia.org/wiki/IBM_3270

Edit: Added the missing link.

That’s a single program. Forget it, Jack. It’s China Town.

On a per-project percentage basis, the parent's story wasted ~100% of the project's budget. The same number for California's unemployment fraud is less than 2% (the program totaled about $110B).

$300M was wasted in an organization that serves (completely spitballing here) maybe ~500k people among all its customer organizations? The California government serves ~40M California residents.

In any case, government waste is likely orders of magnitude more easily uncovered than even public companies' waste. And when we find out, we can lobby for change and vote for policies that adjust the process to hopefully result in less waste.

But when Coca-Cola overpays 10x for some highly-connected contracting firm to build them some shoddy CRUD software for an internal process we'll probably never heard about it due to a combination of lack of transparency and lack of reporting interest. If we do hear about it, there is no real avenue for lobbying for the change of Coca-Cola policy.

That's not even mentioning that Coca-Cola's entire existence could be (rightfully, in my mind) considered corporate waste because their products actively harm the world, which is a claim much more difficult to apply to the DMV or the California government as a whole.

That's more or less the business model for some consulting companies.

Eventually it was sorted out but at considerable human cost. As of Jan 1 2021 something like 1.5 million claimants had their benefits stopped until they had shown proof of identity. It took months to get it all straightened out, especially for people who didn't have drivers licenses, for example.

At the end of the year the department's surplus went to a general fund (and I think this was also a factor in deciding future budget allocations for the department).

So everyone in his department was incentivized to buy equipment they didn't actually need so that they didn't "lose" their money.

The old, perfectly working, hardware would be put out into hallways and get thrown away in the trash.

Granted a public university is a lot different from an actual government department.

It's totally baffling to me when there's 'the DMV' in US films/tv, because that's just not a place (nor anything equivalent) we have to go to, whether it's 'only fifteen minutes' or more.

(Sure, when my driving licence expires in 10y, or I change address, I'll need to spend a minute or so on an online form.)

I've had other interactions with state/local government services over the past couple years, and they've all been pretty bad. It's like anything else: there are helpful, compassionate people you occasionally speak with, but it's easy to get buried in the complexity and ridiculous inefficacy.

Federal (and state for that matter) tax returns are a good example. Something that every citizen of working age technically has to deal with are incredibly complex.

Things have not improved, to say the least.

Move to New York. I recommend NYC, as the food is fabulous.

Looking forward to having you as a neighbor!

For that reason, I suspect it's good idea to leave interpretive space for the possibility that a given bureaucracy has been intentionally hamstrung, or is Kafkaesque by design.

I suspect calling Comcast is miserable because the process is designed to exhaust and manipulate you out of quitting, for example.

I suspect it's possible to build systems that enable you to ensure an ER visit will cost $500 instead of $10000--but our insurance companies may feel like the uncertainty deters people from seeking care.

Some systems are more resilient to dishonesty and incompetence than others. I suspect a mixed system is the most resilient. But we CAN change the behavior by choosing to reward competence and honesty by who we elect, who we hire, and who we do business with.

You can do most things online with a much better UX than most commercial websites. No crappy ads or pop-ups. Plus when you do need to go in, you book a time slot at a DMV center online.

Recently I had to bring my daughter for a driving license to the one in Brockton, MA. When you go in, they give you a token number. The currently processing token number is shown on a huge LED display on the wall. Hundreds of customers are in there, many of them don't speak much English, etc., but things move pretty smoothly and fast. Very efficient.

If I had to deal with customers at the DMV, I think I'd be grouchy too.

Another reason to try and get as much of it online as possible, which I think is most of it nowadays.

One of my requirements of a retirement destination is municipal broadband. No BS, just a fair price for a service that's actually treated like a utility.

The idle rich who can't find anywhere worthwhile to play with their nearly-free money (until recently ZIRPish) are a bug in the system. Oh, but lets pretend we are captains of industry by saturating the world with sure-failures. "I wEnT tO GsB!"

And government is absolutely inefficient, which is a good thing actually. Despite the efforts of conservatives, government still has to account for many many corner cases and special needs. Ask any Agile TDD aficionado how this affects velocity.

I am fine with people who are realistic about government being inefficient, but I insist that they nonetheless try their very best to improve that efficiency (fully considered efficiency, not just making life worse for government workers or people seeking government services). The problem is when you elect people who have an interest in making sure the government is inefficient because then they can use that as justification to enact their ideological goals of cutting government services.

When you buy/sell crypto - money changes hands. That money wasn't really "allocated" to crypto, beyond miner fees, just redistributed. That cash still exists.

The resources being allocated are graphics cards, human time, and electricity AFAICT.

The power usage of crypto is relatively small compared to other active human endeavors. It's power usage doesn't approach other arbitrary value stores like gold and government backed fiat markets. Could it go somewhere else? Yeah - but could we reasonably produce enough to offset it in a positive sum game - definitely. As long as renewables are cost efficient (read: truly competitive with non-renewables) and are net-zero on emissions this misallocation of resources would be allocated to renewable power production in an efficient market.

Graphics cards being misallocated... I'm not sure saying markets are inefficient because a financial market is outbidding video gamers is a compelling argument. Scientific use of graphics cards seems like a small part of the market, but I may be mistaken here.5

Gold is a requirement for industrial purposes, for jewellry, for chemical processes for medication.

Visa/Mastercard perform many hundred of thousand transactions per second.

BTC is limited to 350k per day, and consumes the equivalent CO2 impact as Austria. It can't and won't ever scale, which leaves it open to market manipulation and centralization as transactions move off-chain.

It's not a small amount of energy wasted, and there are significantly more valuable uses for that energy, such as aluminum production or water desalination.

https://www.statista.com/statistics/299609/gold-demand-by-in...

That might be true but 46.64% of gold demand is for "investment", and a further 8.58% is for "central banks". In other words, most gold produced is hoarded and not used for anything productive. If you're against bitcoin because you think it's a non-productive use of energy, you should also be against investment/central bank use of gold.

Bitcoin is intentionally wasteful, and I say this as a technical admirer. Its genius is the extremely simple idea of making writes to a distributed database so unimaginably harder than reads, so that untrusted network peers behave themselves and don't invalidate the state of the shared ledger. The network literally just asks you to spend your time counting to N at the top of your lungs so you don't cheat, if that's not waste then I don't know what is waste.

This 'waste' is necessary when you don't trust your peers, you're buying trust with it, cold hard trust, as rock solid as P != NP. But look at the sheer hype crypto has amassed since 2017 and tell me with a straight face that all those "applications" need trustless distributed peers. NFTs literally store the actual data of the token on centralized servers that can go down or go wild with your data at any moment they goddamn please, the NFT on the blockchain is merely a thin reference.

The ideal path for distributed trustless blockchains would have been as a small niche, an "elite shock trooper" technique when distributed trust among trustless peers is absolutely necessary. Ideally, miners would understand the simple fact that it's of no use to keep bringing better and better silicon to the arena, as the network swallows all in its big mouth anyway, and the network would then grow naturally so that it's approximately the power of NETWORK_SIZE * CURRENT_PC_POWER at any current year, instead of a never ending race to the bottom of sacrificing more and more silicon to the God Of The Hash.

Alas, from the crooked timber of humanity no straight thing was ever made.

[1] https://ccaf.io/cbeci/index/comparisons

[2] https://www.bbc.com/news/technology-56012952

Silicon and other electronic parts also get dumped into this market, when the capacity used to build those devices could be used for other things.

That is an unbelievable statement just on the face of it.

But if we say: "What is the energy use per transaction?" what then?

The inefficiency of crypto currency is legendary.

"likely"? What do you mean?

And that illustrates how incredibly inefficient crypto is

Gold mining and bitcoin are currently roughly on-par. But gold's energy usage isn't just mining. It's the entire supply chain from Cash 4 Gold stores, long term storage, smelting/recycling, etc. I don't have a good reference for the total cost of gold.

However, the point still stands. Datacenters in the US use total energy less than 2 bitcoins. How many of those datacenters are moving fiat around? Way less than half?

Things like brewing tea and heating houses take a ton of energy. Moving money around doesn't!

Crypto is a huge waste, and that site does not suggest otherwise.

That is not true from what I see (modulo contract enforcement and policing of anti-social elements). There are many examples of smoothly functioning markets. With my economics geek hat on the things required for a market include:

* All participants must have choice, be able to enter and leave in the medium term.

* There must be clear information available about the properties of the goods and/or services

* There must be clear information about the prices.

The first condition (choice) can be rough on suppliers. The "choice" for a coffee shop is closing or bankruptcy. But for the supplier of electricity from a hydroelectric dam the choice is different. There are no clear boundaries.

For the consumer they can substitute potatoes for kumera but there is no substitute for food. Everybody must eat.

So: Reticulated water and electricity are bad things for markets. Vegetables (except during famine) and entertainment services are good

The government has heavy handed regulations distorting the market and spent the last years creating money out of thin air and killing small businesses.

The government propping the market up during the pandemic kept alive the myth that the market is always growing but also caused a terrible inflation.

Now that the market is going back to reality the government can't just print more money again - or inflation will kill the entire country.

The incoming crash will hopefully pop some of the bubbles the government created in the last 20 years. But it will be painful.

I'm trying to follow this but not understanding it. What do you mean by " Only when "the market" gets its cut". A you referring to public/private partnerships here or pork barrel politics? Something else entirely?

Probably should start putting some energy into getting ready for pre-industrial age living again.

[1]: https://www.bbc.com/future/article/20191108-why-the-world-is...

Too many people just want too much shit. 7 billion people are really not that many - but 7 billion people who wants to live like Westerners that's a big problem.

All the while we are still living in the age of exploitation. We can build marvelous things now but our recycling is still stuck somewhere in the medieval ages...

This whole party can only last if the recycling of an iPhone becomes as financially sexy as building one...

Every single one of those industries uses multiple CRUD apps in the course of their business operations. The database is one of the most important technologies of our civilization.

Snark aside, it is bit disheartening to see all this capital being thrown into handwave-y Web3 verticals.

I used to enjoy MMOs too. I stopped playing and took up gardening of all things :). I'm still not sure what the economic value of web2 is yet, but if you find out I'll attend your showHN.

But hey, at least the Fed hasn't started buying equities too, like the BOJ.

https://www.bloomberg.com/news/articles/2020-12-06/boj-becom...

Jesus yes. Economists treat all spending like it is equal in value. Stupidity.

Robert Hockett has written a lot about productive investments via the federal reserve banks, and how that could be used to transform the economy.

Here's one recent paper: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4023614

He wrote a short book about it as well: https://www.amazon.com/Financing-Green-New-Deal-Renewal/dp/3...

One thing I've been a long-time advocate for is States setting up their own banks akin to that of North Dakota's. If for no other reason than to have a way to leverage national monetary policy for regional aims, so that when the Federal government rushes to the aid of Wall Street (e.g. by flooding it with cheap liquidity) there's a way for State governments to more directly interact with those mechanisms themselves for their benefit.

I strongly suspect significant challenges in setting up effective and responsive governance and incentive structures to keep such things from not becoming their own instruments of abuse, but ever since watching 2008 unfold it's bothered me how easy it is to leave States twisting in the wind while the balance sheets of financial institutions are made whole by feeding at the Fed liquidity trough.

One of the basic premises of "States rights", as it were, is that it's supposed to offer lots of little "laboratories of democracy", but as it stands right now there's no good way to actually finance those laboratories to invest in ambitious things. So, what we mostly end up with instead is only the downside of using "States rights" in the only way that it's cheap to do so, which is usually by restricting or denying things. It's much harder to get the upside of investing in things without all the latitude that the Federal government enjoys financially.

"Liberal Democracy" is all theatre, all the time. It is a plutocracy with an extremely advanced propaganda arm designed to fool even the most intelligent observer, as can be seen by the high degree of trust placed in the system by my esteemed colleagues here at HN.

Alas, we get the rulers we deserve.

1. https://publicbankinginstitute.org/money-banking-basics/

completely controlled by presidential appointees. (they have the majority of the seats)

Imagine that. You refuse to do your job and you still have a job.

Only in America.

Congress has the power to monitor and "regulate" The Fed. That is, The Fed is not - or isn't supposed to be - completely autonomous. It has oversight, or should.

The reality is, it does not. Congress lets The Fed run wild. That might be the status quo, but it's not how it legally needs to be.

So yes, Congress isn't doing their job. And no one (read: the media) is questioning that negligence.

Again, only in America. << That's not editorial. It's a statement of fact.

1. https://publicbankinginstitute.org/money-banking-basics/

He was interviewed on Marketplace (NPR) this past week and he should be a politician. Tons of half answers and such. Another disconnected elite with zero affinity for accountability.

I agree with everything else, but Europe is dealing with even worse inflation than the US and the ECB is being even more dovish.

That's the scope of Only in. America, in this case.

To me printing money should only be used as emergency measure just like administering of adrenaline in emergency room and must be reviewed afterwards. Unfortunately such instrument has been abused for a prolonged period as central banks saw no inflations. Of course there was no inflations in central banks' eyes. The first thing was that the definition of CPI was biased and not considering assets. Secondly in a global economy, inflation can happen elsewhere. So in the past decades, China actually absorbed lot of the actual inflations. And lastly and most importantly, the printed money went into the wrong hands. The extra printed money goes to the banks first, then goes to the rich in the form of loans. There is so much money in the market and it would be nice and easy to make money by bumping the assets prices up. So why would anyone put money into anywhere but virtual economies? That's pretty much what happened in recently decades, properties, shares etc. skyrockets but what really make their value changed so much? Nothing but too much money. For the poor, obviously they can hardly get any loans, so they only get their normal pay which would be diluted over time.

Crisis happens mostly because the poor doesn't have enough money to spend. Printing money obviously cannot resolve the problem, but it do be able to maintain the momentum a little bit longer by making it worse. The burst got delayed but eventually will come back harder, sooner or later.

They would use the money to buy back their own stock.

See Abbott Labs spending 5 billion on buybacks instead of keeping their infant formula factories up to code.

The problem with a share buyback is if you do it and then the share price falls again.

how's that a problem? I get it might seem like you're back to square one if you did a buyback early this year, and the recent market crash brought the share price to before the buyback, but you still permanently:

1. paid out money to the shareholders who sold

2. increased the ownership stake of the remaining shareholders

give me an example of large infrastructure projects like this. The only examples i can think of are things which gov't fund via tax payer money, and don't expect to be able to reap private profit off; things like roads, rail, electrification of the grid etc.

Wonder how a similar mechanism would work today

What parent comment is talking about was the system of cash and cashless (безнал) roubles. Cashless roubles were used for industry purposes and couldn't be converted to the ordinary roubles available to the population. When USSR allowed cooperation (primitive private business) in the late 80s, it was used by many officials as a tool to convert the cashless roubles from the organization's they controlled into real currency in their private pockets. And a lot of oligarchs (including Khodorkovsky) got their fortunes that way.

It's ironic that now ordinary Russians blame the chaos and injustice of the 90s on capitalism and free market, whereas a lot of that was created by a state economy system and exploited by corrupt beurocracy of a communist party.

I think individual home ownership is important, and thats not where I'd want to start cutting.

Credit for second homes being less cheap - totally onboard.

but this has to be counterbalanced with higher rate credit for other things otherwise inflation happens (assuming low unemployment).

But they are involved in policy decisions, being consulted and themselves asking. They do t have an independent mission the way, say, a trucking company does.

    The Board of Governors—Located in Washington, D.C., Board members are appointed by the U.S. President and confirmed by the U.S. Senate. Board members and staff are civil service employees.
    The 12 regional Reserve Banks—Located around the country, the 12 Federal Reserve Banks are chartered as private corporations. Employees are not civil service.
    The Federal Open Market Committee (FOMC)—Composed of the Federal Reserve Governors and the Federal Reserve Bank presidents, the FOMC is charged with conducting monetary policy.

The truth, which is difficult to uncover and requires digging into some legislation, is of course unsettling, because it points to the nature of the American system and which institutions have power. Hint: if an institution is immune to bankruptcy or prosecution, it's probably the one in charge.

1. https://publicbankinginstitute.org/money-banking-basics/

I just don't see why they can't put conditions on some of their lending to focus the intent of the money.

This also means that housing is pretty resilient to recessions that last < 1 year. Nationwide the '73, '80, '82, '91, and '01 recessions were barely blips to housing prices [1]. It takes a sustained downturn of > 4 years or so in a regional economy to make a serious dent in housing prices.

[1] https://fred.stlouisfed.org/series/MSPUS

0: https://www.youtube.com/watch?v=l0Mw8hCzQ1I

>The trick in investing is just to sit there and watch pitch after pitch go by and wait for the one right in your sweet spot. And if people are yelling, ‘Swing, you bum!,’ ignore them.

I know too many folks who did 7/1 ARMs cash out refi to purchase another home in a 7/1 ARM loan, banking not on cashflow but appreciation.

I know of folks who bought homes using margin loans in their stock portfolio.

If housing stagnates, there will be margin calls, leading to supply shock, and price declines. Especially now that mortgage interest rates have nearly doubled year to date.

I can't be alone in wishing that would happen. Yes, people would lose a lot of money (potentially everything), but they played stupid games.

But not refinancing afterwards into a low fixed rate may come back to bite them, and soon.

I understand the tax logic you are speaking about, but I think tax benefits are sometimes oversold to convince people to buy things (like homes and investments). You aren't a corporation, your liability isn't limited. Trying to shave a bit off taxes may have less benefit to you than the peace of mind of not having to juggle debt. You seem like you understand that when you talk about refinancing asap, so I think you know what you are talking about as well.

The other option was to instead take a margin loan out at a hair over 1% blended which is tax deductible and incur no tax bill.

There was a bit of risk in this yes, but I came out way ahead despite there being a pretty sharp pullback right after I closed on my house. I wasn't leveraged to the hilt at all, I think I had a loan equivalent to about 25,maybe 30% of my portfolio when the market pulled back.

If you have significant assets this is something you should be considering. This is imho one of those "rich guy" things that's available at a relatively low level of wealth, and the risk associated with it is well worth it in most cases.

People will pay more for diamonds that are less likely to have human rights abuses in their supply chain.

People will pay more for eggs if you don't keep the chickens in cages.

People will pay more for money if the government gets a smaller cut.

My theory is that eventually the unemployment rate will start rising, and people who lose their jobs that just got a 600,000$ 2/1 will be in a pretty tight spot. It would lead to either cutting consumption in other parts of life, defaulting on the house, or selling for a loss. And so on and on...

What's the strategy behind the "7/1 ARMs cash out refi" and the second homes?

It's curious that would people do an ARM when interest rates were at historic lows no? Were these second home as in part vacation home, part AirBnBs lets?

All-cash is basically the new norm. Two years ago that was an issue for regular buyers, but it’s workable now since lenders have jumped into the mix, more and more offer an all-cash option - they make the purchase and transfer it to you under a traditional mortgage. You still have an appraisal gap to contend with, sine they’ll only pay what the place appraises for, but anyone who qualifies for a loan can probably qualify for the all-cash option.

On one hand the high inflation pushes out lots of buyers -- they can't or don't want to pay the high interest rates. This lowers demand and prices.

On the other hand global supply chain issues (which got much worse with the war) lead to material shortages and rising material costs. This pushes up housing prices.

The net result is likely stagnation -- few houses are built and few exchange owners. But prices stay high.

Except if there will be a large recession causing people to loose their jobs and unable to pay their mortgages. This will crash the housing market, but looks unlikely now.

I think people are feeling more risk adverse cost of living etc and want to hold onto money and stay put where they are.

Another way say "20-27% over asking" is "an agent underpriced it by 20-27%". Surely good for their marketing materials, but it comes at the cost of withdrawn information from the seller.

It’s paradoxical that all-cash became the norm in a period where mortgage rates were at all time lows…

We could also pull on the demographic weirdness of the moment as Baby Boomers only finally cede political power, skipping a generation. What have all are priorities concerned since they came of voting age? Should we be surprised our recent policies continued to favor older people who owned homes over young people deciding the shape of our next generation? And to be clear, I'm not blaming any motives. I'm saying much of this can be explained by an "accident" (or maybe "conclusion") of demographics.

The worst is if our incentives are for lazy capital returns (like rapidly rising residential real estate) for retirees the people who benefit in the younger generations are not going to be the people taking risks like starting businesses.

Cash transactions have less friction and chance of falling through, so it makes sense that sellers prefer cash purchases. Consequently, you see cash offers because buyers know that sellers prefer - you essentially jump to the front of the line.

Because there was a concurrent trend to refinance houses at 2% loans and put the cash in the stock market, which is assumed to beat that 2% over the duration of the loan.

Inflation and a return to nonzero interest means capital gets to retreat to safer ground, pulling the rug out of stupid unprofitable startups that can only make money with head-in-the-clouds IPO valuation or FAANG acquisition.

https://fred.stlouisfed.org/series/CIVPART https://fred.stlouisfed.org/series/JTSJOL

As these two converge, wages are probably going to go down while inflation may still be high.

In other words you can’t keep the party going forever and how things are now isn’t an excuse for irresponsibility.

Of course the modeling flaw is that money is saved as a goal in itself so it will cease to circulate at some point which is the real source of unemployment.

It's irresponsible to bid 20% over what the house is worth (which has nothing to do with asking price), just because you got emotionally attached to the house, and started a bidding war with another person emotionally attached to the house.

No, but there is a 'what was selling price for similar homes in this area' price in nearly every specific.

Listing prices are intentially set to be much lower than selling prices. Selling prices are the real prices, listing prices are fiction.

People paying 20% over listing usually means that listing was 20% under selling. Boring! And not financially imprudent!

People paying 20% over average selling in the area, for an equivalent home is what raises my eyebrows as financially imprudent.

I feel like this is only true in irrational housing markets, or at least those that have a chronic undersupply of housing .

In my local non-insane market I went through two different purchases where I successfully bid less than asking.

That's gone since the pandemic though since everyone tried to move out of cities and work remote in my town.

During a buyers market, prices usually approach the list or go under.

This reflects the fact there is how much the house is worth to the seller, and how much it is worth to the buyer, and neither of these are the sale price.

This has been true even in many cities that aren't trendy, and have been building housing like crazy for a decade.

There's also sunk cost in the effort of finding a house you want and reluctance to keep looking.

My unremarkable suburban house in a boring city that's been building housing constantly and extensively for the last 10 years, is up like 25% in value over the last 2 years. We thought, based on extensive experience in this market, that we were already paying a bubble-induced premium of 15-20% when we bought it (possibly no longer true—thanks inflation). WTF.

If inflation is 8.5% and a mortgage is 3%, the bank is paying me to buy a more expensive house.

At the same time, If I hold and wait to buy, my savings are evaporating while the price goes higher.

Let the cash buyers suffer the losses. You'll thank yourself later.

In my market nearly all winning offers have waived the appraisal contingency

But since you mention it, in the slower market being discussed here, I would definitely not waive an appraisal contingency.

The point is, in a lot of markets, if you bailed on offers over this in the last couple years, you wouldn't be winning any bids in the first place, and wouldn't have been able to buy a house at all. The winning bids include guarantees that the buyer will cover the difference. If you won't do that, you'll lose to an all-cash offer from someone who will. If you're lucky, you won't be competing against superior offers that also waive all contingencies.

I have no idea where all these people are coming from with hundreds of thousands in cash and the ability to cover several thousand more on top of the appraisal value, but they seem to be involved in damn near every sale the last 2ish years. Given how many are OK waiving inspections and such, I have to assume they're institutional buyers who can spread that risk around, not individuals who could be ruined by that kind of thing.

The "solution" to this, in the run up to the '08 crisis, was for appraisers to "help out" by fudging their figure to make it match the sale price. I know this because a real estate agent whose husband was a loan officer, told me so. "I know they were just trying to help out with these new regulations, but it's had the unintended consequence that appraisers can't fudge their numbers slightly higher to match an offer that's only a couple percent above the natural appraisal, like they used to". LOL, yeah, the exact thing they were trying to accomplish was an "unintended consequence". Talk about not being able to understand something because your paycheck depends on it.

Possibly some appraisers in at least some markets have figured out ways around this, and are back to fudging numbers. I dunno.

My appraiser (on a refi) was walking around the house with me and basically asked what I thought the place was worth. That was what it appraised for. (The contract price on an original sale has the same property: what the buyer thought it was worth.)

Ideally those are tethered, but the appraisals didn’t give me a great sense of independence.

If the buyer chooses to proceed, this can be a financial disadvantage reducing access to a highly leveraged loan.

If you are young it can be perfectly sensible to bid far more for a home you love. An “overpayment” is paid over many years of happy living, which can be a worthwhile trade.

Living in a cheap economically sensible shithole for too many years is a bad idea, unless you have no other choice financially. The problem is making sure you buy a home that makes you happy. Overcapitalisation is sensible if you can afford it, and if you truely do get valuable pleasure from living in your home.

Yes, do take care to avoid the mistake of buying a home and getting chained into a situation you end up hating.

I think most people are better off just renting until this madness blows over. God knows I am much better off for having rented and plowing my money into investments for about a decade before I bought my place.

Houses keep up with inflation over the long run, while stocks have returned ~ 7% after inflation. If housing is an investment, it's a poor one, and you should invest only what is absolutely required to have what you need not want.

I think you are committing the error I am trying to point out: don’t treat your living requirements 100% as an investment.

That said, your living choice always has an investment decision component, because most of us need one roof over our head. If renting, you are shorting the home ownership market (a renter owns zero bedrooms but needs one bedroom). Making the decision to rent is either (a) betting against the real estate market (shorting), or (b) betting that one can make better returns through other investments.

The deeper point is that we should try to optimise for our internal joy, and nobody should measure their success only in metric dollars.

When we sold our house the broker put it at a fair price. Then along came a couple that’s been outbid a number of times and offered 30% over within 24 hours of listing.

Was the home underpriced? Maybe, but the housing market is such that it doesn’t have to appeal to hundreds of people. Just one.

Looking at the people going through the home most of them were using flyhomes.com (they operate as sort of a “we will pay cash for the house and then you pay us back”) and probably had no intention of living there.

There is what the house is worth to the seller, and what it is worth to the buyer, and the sale price is always somewhere in between.

It is just taking advantage of an information asymmetry to get the sale price closer to what it is worth to the buyer.

How can employees realistically speaking even do this?

I wouldn't want to be a mid-level Bay Area manager in my 40's with a mortgage on the peninsula right now. Who is coming to buy that house? Who is going to train all the 22 year olds moving here?

EDIT: And I didn't even think about all the early retirees the major changes to the workplace will obviously prompt. Who wants to spend the last couple years of their career re-learning how to do a job you've done for decades and have been well-compensated for? I'd be at the beach.

In the US, pay is around $215k total comp ($175k base, $40k RSUs). Because, I'm in the Toronto (which is more expensive than most of the US), they said my pay would get a circa $111k USD base ($145k CAD base).

Adjusted for inflation, I'm earning less than what I was making when I was 25 years old. Now, at age 32, I'm struggling to pay significant debts on this salary.

What am I to do?

Yes, you're getting paid less, but you've moved from a broken democracy to a functioning one. You also happen to be in one of the few nations on earth that will net benefit from climate change.

Actionable advice? Get a remote position and get the heck out of Toronto to a more LCOL Canadian location with decent internet

It talks about the phenomenon (relevant to places that don't seem to be thriving more than to hot cities) of a new strip mall bring built next to a mostly vacant strip mall that's fairly new itself. It explains that this is a developer cashing in on the glut of money chasing returns. He talks about how any business that pretends to be legitimate gets funded, and the competition to loan money to actual functioning enterprises becomes so intense that the eventual owners/lenders/etc. end up having something that looks like a malinvestment because they were the people who predicted the lowest risk and highest returns (in the context of all the other insane things being funded.)

I listen to between 300 and 500 podcasts annually and, despite having a backlog of 175 episodes of various things right now, this one was worth the re-listen (at 1.5x speed, of course.)

You can thank the central banks for this. They seem to be too focused on propping up the wrong metrics. Meanwhile the real economy - and the real people in it - are limping like a three-legged dog.

Yet the top layer ignores the messages (e.g., in the USA, Trump being elected, and perhaps re-elected) and persists with the insanity. This cycle - and the associated level of denial - is not sustainable.

Not economically.

Not socially.

And not ecologically either for that matter.

We can't consume our way out of this madness.

Who buys a house in cash? You mean literal suitcases of dollar bills?

Or do you just mean something like a bank transfer? What other ways are there to buy something?

Not literal suitcases of dollar bills, no. Buying with cash here means without taking out a mortgage.

To answer the first question about who buys a house in cash, 28% of buyers do so[1]:

> All-cash sales accounted for 28% of transactions in March, up from both the 25% recorded in February [2022] and from 23% in March 2021.

[1]: https://www.nar.realtor/newsroom/existing-home-sales-slip-2-...

Not really, pay in 'cash' and you can close in days, pay with a mortgage and it might take weeks to months. Sellers always prefer cash buyers if they are in a hurry to sell.

An all cash deal means the seller does not have to wait once the parties have a mutual purchase agreement.

If you expect inflation to stay high for a while this is actually rational... as long as you still have a job.

When a critical mass of individuals pay the marginal rate for housing, and they choose to demand more for their services to compensate - then it will show up in the inflation reports. I'd argue that it was a miss for the Fed to focus on owner equivalent rent rather than a broader measure of what consumers are paying for housing as the overall mix of housing has also been changing as the number of investment properties increases.

If you talking about specifically renting housing, then correct(in US).

Depending on the growth rate, a 100x P/E may be cheap.

Buying in cash is being done to skirt the tightened up lending standards that followed the 2008 Crisis:

https://www.reddit.com/r/Superstonk/comments/uflzht/the_2022...

I'm baffled why people would get their economic analysis from a subreddit predicated on a short sequeeze that has failed to materialize.

The problem with markets is a "market efficient" outcome can be catastrophic for social welfare.

During the Irish potato famine the markets allocated food away from Ireland because there were not many there who could afford it. They starved. The market functioned perfectly.

Markets find equilibriums. Total collapse is an equilibrium. Starvation can happen at equilibrium.

You can have 100_000 homeless people at market equalibrium

As the Bezos Battalion, the Zuckerberg Zealots and the Musk Machines close in around your hometown's lithium supply, you can of course die with pride knowing that you believed in the Constitution and lived as the Founders intended.

(plz no ban, I love Free Markets, I'm just working on my creative writing)

That said. I'm obviously heavily biased but I have realized MOST non-finance employees know very little about the financial health of their employer or even how the business model operates, or even what is the current/future strategy of the company.

When something MAJOR is announced, M&A/leadership changes/etc, the questions the room typically ask are: 1) will we still get 401k match 2) will we get fired 3) will the office relocate. People don't really care too much about the company, they care about how it's volatility impacts them. I don't think it's such a bad thing, but just pointing it out. In startup land, volatility is huge and the highs and lows can occur with rapid frequency. You have to be an assessor of risk when changing any jobs and this is part of it.

Because if I am a vesting or fully-vested employee, then that's my own future at stake. The 401(k) can be dwarfed by many times by a successful stock worth millions, or, in a badly run or positioned company, the stock could be worthless underwater paper shares and I become dependent exclusively on the 401(k) for my sunset days.

The financial literacy of many workers is low though. They don't understand what options are or what it means to really be a shareholder.

When I was at Cisco — I'm talking in the 1990s — we used to describe what we called "stockholder angry." This was when a fully-vested employee heard a VP or above talking about some idea so stupid it would literally cost the company a penny per share or more. That's when the old dogs would get "stockholder angry" and propose alternatives, or ask people to stop ideas that were retrograde for the sake of the company's valuation. Because we knew what a penny per share meant to each of us.

I believe it is valuable for employees at all levels to be able to know the state of their company's health, and then, with an informed mind, be able to voice their opinion on the fate of their organizations.

Options and the various schemes can be confusing. What's worse to me is many people in middle manager type roles that run a department/unit, are responsible for a budget, they can not read a basic income statement. They don't know how or what levers move the needle or in which direction. Some are very good, but many are very, very bad given their level of responsibility I've seen. I've been in many meetings even in my days as a junior analyst explaining to seasoned executives how volume doesn't cure an issue with unit economics. Separating out variable costs and explaining that if you can't cover those, you'll never cover the fixed costs... Those types of things. It's job security for me, but still shockingly common.

I remember interviewing with a company in 2000 that had burned through like $40 in two years. This was New York and they hired IBM. I don’t remember their product but it was stupid. They had paid IBM to build their own custom app server for Java because their requirements were too specific for WebSphere that IBM made. They built their own internal Java app server from scratch.

So that was stupid.

Also the interview was on a Tuesday or something and they said that they were out of money on Friday but were confident they would get more money on Monday.

They wanted me to start immediately and when I turned them down because of the funding, they asked if I would start on Monday.

It was such a surreal experience that a whole organization could be so crazy.

> They wanted me to start immediately and when I turned them down because of the funding, they asked if I would start on Monday.

Is is straight out of a comedy sketch, I feel like you could take that to an open mic night and kill with it.

They burned $40M.

$40 on their own app server in IBM fees would be pretty cool and interesting in a different way.

caring about the business and its fundamentals is important beyond just slinging code.

This is a huge red flag in my eyes, of not being open enough to see the books. It signals that something is quite wrong at the company, and even if it weren't, that they are not truly honest with their employees.

if they're not, I'd be worried about the financials, the culture, or both.

Refusing to disclose the number of outstanding shares is a huge red flag.

A startup was peeved I valued their equity at zero when they wouldn't share. I got strong hints my equity was worth at least $100k in extra annual salary, but they wouldn't budge on disclosing anything I could hold them accountable to. I think they were being honest, but I didn't take the job.

I did take a previous job like that, and when the company sold, we were all surprised management was honest. Management gave a used-car-salesman vibe, which was just wrong. I think with transparency, people would have worked much harder.

I don't have insights as to the reason for the extreme opacity.

People constantly assume good faith in these things when they shouldn’t.

Obviously number of outstanding shares is a bare minimum, but things like cash reserves and cash flow should also be shared but they don’t want to share that information, often times because it’s not good, they just wasn’t people who believe in the “mission” or that it’s a rocketship or whatever.

The secondary reason is that there are still too many naive engineers who assume good faith, drink the startup koolaid, and take these offers . Sometimes even declining public RSU grants to do so. One company out of ten thousand have ISOs that are worth anything but those are the only company in the headlines so the mystique continues.

The only solution is education. ISO (Incentive Stock Options) are one of the biggest scams of all time and you’re financially illiterate if you value them more than zero. They are carefully designed by venture capitalists to screw employees. NFTs of monkey pictures are infinitely stronger financial assets than startup ISO - I mean, as least the monkey jpegs have liquidity and volume, and no liquidation preference coded in to screw you over.

Really the best strategy is ISOs that convert to NSOs with 10y exercise windows when you leave. best of both worlds.

Given the number of millionaires and billionaires who can credit ISOs for their current wealth, I think that's too broad a statement. At the end of the day, a well-run company that can eventually go public because they have a strong business can be worth joining and the ISOs can be worth something someday. Admittedly, many will not, but if you pick the right one, you could do well.

* They IPOed and are still in business.

* If I had taken the offer, the stock would have been worth between 50k and 150k per year, depending on when I sold it. Their estimate of 100k per year was spot-on.

So they were being honest. Good to know! They were late enough stage when I was applying that they could do a fairly reasonable valuation. I think I would have been much more likely to take the offer if I had information like this in writing.

I still think I was right to value the equity much lower, since I had no way to know if they were being honest at the time.

Ultimately, I came to respect their opacity. They didn't try and deceive me into "millions that could be mine if only X happens"

Unsurprisingly, my options turned out to be the typical startup-style employee incentive options which were invalidated/worthless upon the company being acquired.

I was young and new to the industry so didn't know any better at the time.

I asked for my first grad role. I asked a lot of probing questions. 3 years in I was running teams and setting up operations for the business in another country for them. I even told them I’d be leaving to start my own business after this job (and did). This resonated because I was speaking to their founder at the time and knew we’d be cut from the same clothe.

Holding yourself back at a young age can just stunt your career development. Asking such questions will appeal to the right employer.

Unsurprisingly this one went from 35 to 150 staff, profitably in the 3 years I worked there. I was 22 when setting up other parts of their business. I’d started at 19.

I wouldn’t advise folks to avoid such questions just because they’re young or “need the job”. Stand out! You’re even more likely to get the job.

As noted by others here: if they react poorly to this in the interview, you already won by dodging a bullet.

I suppose it also depends on your country, but at least here in the USA, that's hard to come by (especially for the lower / middle class).

Being able to be discerning about a job is a privilege that not everyone has. As someone who finally can, I'm happy to acknowledge that rather than pretend other folks are doing something wrong.

I don't disagree that they'd be dodging a bullet, but some folks have to take a bullet to get health insurance, pay the bills, and god knows what else given their circumstances :)

If I got hit by a bus tomorrow, they would send flowers and “thoughts and prayers” to my wife and have an open req before my body got cold.

Unless you actually have a consultancy which is based on seeing the ways in which you may plug a hole in the dyke...

And IC should ADD value to the org, not just slurp off of a need the company needs to fill.

2. Your managers aren't perfect people, but their livelihood is in your hands. It's incredibly stressful to be a manager, so try to have compassion and empathy for the position they're in. They have to explain to the executive team the progress you're making, and if no progress is being made, they take the blame.

3. If you can't connect the dots between what you're doing on a daily basis, and the overall trajectory of the company, then something's wrong. There's a broken connection somewhere, and no one other than you is going to realize it. Speak up if you don't think what you're doing is useful.

My job is to write code. Nobody is interested in my opinions about business problems.

I have to be aware, of course. I propose code to write some times, and I have to have some idea that it is a vaguely practical thing in business terms. I want to write code in groovy system A but mundane system B has a better chance of success then my desire for system A goes by the wayside.

But it is my job to write code. That is all.

> Code is an expression of a business solution

At some very high level that may be true. The person who makes the final decision on what code I work on (who happens to be the brother of the CEO, poor fellow!) may have to consider "business requirements", but only lightly. We implement what we are told to implement. I am a worker.

> The meat of any application is in the business rules it enables and enforces

No. That is crazy, and very high level. Where I work the "meat" is tight loops, memory allocation, network latency, data reliability....

> To be an effective engineer

I have not been to Engineering School. I am not an engineer. Engineers are people who have been to engineering school. I am a computer programmer working on low level iOS plumbing. "Engineer"? Huh! Putting on airs, I do not do that.

> To be an effective engineer, you need to have a solid understanding of how the code you're writing solves the needs of the company.

To be an effective computer programmer I have to understand the requirements that my firm has of the hardware. I can give very good advice about whether the hardware can be persuaded to do what they want. I cannot give (good or valuable) business advice about whether the things the firm wants are the correct things.

I understand a lot of people here really want to be successful "founders" and come at it from an engineering perspective. Very good. It is different for them than for me.

A lot of us (at least one of us...) here are workers who want to do a job, for a salary. Happy to work for one of those founders if the money is right. (I have to make a business decision about who I work for, in the best scenario. In my case I took what I could get, and got lucky - thank you universe!) I am not qualified (I am actually, another story) and am not employed to give business advice, or to care. I am more valuable to everybody if I stick to my knitting.

My point is that the code, and all it’s material constructs that you pointed out (loops, allocation etc), do not exist apart from the business, because it’s the only reason those things exist in the first place. I’m not sure how much experience you have, but if you have enough, you should know how easy it is for an engineering team to become disconnected with the goals of the company. I’ve seen devs waste literal months on things that, had the primary stakeholders known about it, they’d never have agreed to.

Now, you could look at that situation and envy the job security. Sure you could just see yourself as just a cog in the machine, with no responsibility whatsoever in wondering why the fuck you’re doing what you’re doing. But I certainly would not hire you.

What else is that true for? All the way down. Biology, chemistry, physics, quantum physics.... All that we work on exists in those contexts too. Yet we just swim in the sea and ignore the water. The same is true of business matters. They are the ocean I swim in

> I’ve seen devs waste literal months on things that, had the primary stakeholders known about it, they’d never have agreed to.

That is poor communication. Communication is a necessary skill for all cooperative endeavours.

I am a cog in a machine. Unusually for some one in my position I actually have a good understanding of business (studied it for years) and I prefer computer programming. Having computer programmers stick their oar in over financial matters, unasked, is not good. So I do not do it. I know my place, I like my place.

> That is poor communication.

…yes…as I said, there needs to be a tight chain of command with clear directives at each layer, in other words, good communication. When there is a break in the communication chain, the only thing you can rely on is an individual developers judgement.

But there are lots, and LOTS of people who would, and want EXACTLY THAT. They want people to be told what to do, and do it, and not question why.

I see it in the same way I see security. A company is only as secure as its most vulnerable employee, so everyone must be vigilant about their own personal security practices. Same goes for "product security" - ensuring that the micro-actions taken by each IC reflect the company's objectives. It's an all-hands-on-deck practice.

Even if you are getting paid an extremely good salary, who wants to start working for a company that's potentially months or a year from becoming insolvent? The fact that this might not be standard due diligence as suggested by your comment is mind boggling to me.

Otherwise I become shark bait. Been there, done that.

I'm average and have always asked these questions :) When I got my CS undergrad I almost had a minor in business, so that side has been an interest from the start.

How the company is doing, what is their core business, and how will my position fit in that business have always been key questions for me when interviewing a company.

Even within FAANG, many people build careers while working on sinking products (Most products in Google are revenue negative...)

So they pivoted, and now they've aimed their engine at CBD reviews or something. I still don't see the point.

Not everyone is a visionary like Steve Jobs or whatever, and that’s okay. Just build something that solves your problem and helps others who also deal with it.

https://news.ycombinator.com/item?id=31217221

The desire is there, but the idea(s) aren't and it's not for lack of trying. I've been reading that "ideas are cheap" for over a decade now, but I can honestly say that I haven't once come up with an idea that would make any money.

Ideas are cheap.

Good ideas are darned hard to find and even harder to recognize.

One thing you can try is just talk to everyone. Literally everyone. I’m a super introvert and socially awkward, but if I’m standing at the bus stop or in a Starbucks I’ll talk to people and 9/10 times they will talk. Sometimes they’re people who run or work at companies in industries unfamiliar to me (construction materials, biologist, textile) and they complain about what sucks. Just keep an open ear and hopefully you can find something interesting and compelling that you can build for. Good luck!

I've had that conversation. Anyone remember Cuil, the search startup? No revenue. No revenue model. Then no business.

If bleeding money scares you, then a startup is probably not the right fit, a huge number of startups fail.

I think Github, Notion, Retool, Slack, probably Figma, hit revenues quite quickly as they launched and became profitable or at least close to breakeven.

Slack says it may not turn profitable; IPO filing reveals $139 million in losses, Microsoft primary competitor

The Slack IPO filing shows annual revenue of $400.5 million, up 60% from the prior year, with a net loss of $138.9 million, for the 12-month period that ended Jan. 31. Slack's actual fiscal year-end date has yet to be determined.

Actually the Slack I remember from when it first came out is more or less the same product they have now. I'm not really sure what all of those people were doing for all of those years.

I never liked IRC. But to not like it and pay for it? I do not understand.

Am I a fossil?

It's got a lot of enterprise features that companies like, like SSO integration, message retention policies, security certifications like HIPAA and FedRAMP, and more.

There are also a lot of pre-made apps for integrating with corporate apps like Jira, Gmail, Salesforce, etc.

It's fine, I haven't looked at a lot of other options, but it seems more usable than Google Hangouts (or messenger or whatever they call it now) or Microsoft Teams.

I think a lot of tech companies struggle to break into the non-tech world. Slack might be ubiquitous for SWEs but my SO who works in traffic engineering will probably never use it (they use Teams).

They do. They acquired ScreenHero for screensharing, and then fucked up the integration.

> https://www.xda-developers.com/slack-working-on-video-suppor...

They've only just got it right - check out Huddles. No doubt with their next yearly annual conference they'll be releasing the video version for this.

Is that a case of business people making technical decisions?

That I understand. Do not like, but I understand

They need to scale their systems, maintain reliability, scale their processes, build internal tools, run experiments, work with 'legacy' code and within the existing architecture, etc.

It's not surprising product development has slowed down. In almost all cases it seems like the speed of product development is asymptotic.

The problem generally starts when you hire a bunch of people without fixing broken processes first, these people then push back against fixing said processes, and the rot sets in.

It used to be that you spend your Series A and B figuring out the business, and from Series C forward you've got your unit economics dialed in and are just pushing the "growth" button as hard as you can.

Nowadays you get all the way to IPO without ever achieving positive unit economics: Uber, Lyft, DoorDash... You have companies raising (or trying to raise) Series E, F, G while they lose money on every transaction and make it up in volume.

I suspect OP is talking more about that phenomenon - companies that are way too far along to not have positive unit economics on their core business.

In all the ones I've experienced or looked at, not hardly as good as tech companies pre-FAANG, your "cushy job, fully remote, good pay and full autonomy with flexible hours" strikes me as an uncommon situation.

Knew someone at a Startup with a product & storyline that would make for a comedy fiction show.

Their CTO called me, enjoyed a convo, and offered me some untitled job - no interviews, no game plans. But full on salary match, equity, whatever… (I make mid 6 figures)

But I’ve been so entrenched in real business that the whole thing just seemed completely off to me.

Mentioning revenue and not profit is not informative.

Usually more than the 'above average' founder or VC.