Re:The CEO of a $1 billion 'unicorn' startup admits we're in...
by clarky07 on Friday June 12, 2015 @01:17PM
(#9707246)
I did live through both of the last bubbles.[1] That's why I'm suggesting this would be different. I didn't say it wouldn't be felt at all, just that it wouldn't be nearly as bad.
are there really a lot of pension funds investing in 0-revenue startups in SV? That seems like a place I really don't want my pension.
EDIT: [1] I lost a lot of money on my house that I bought in 2008 and sold in 2014. It sucked. I can't imagine my next house losing money because snapchat goes out of business....
Re:The CEO of a $1 billion 'unicorn' startup admits we're in...
by ebbv on Friday June 12, 2015 @01:30PM
(#9707325)
If it's just one company like Snapchat going under, then sure your house value won't go down because of that.
But that's not what we're talking about. We're talking about a bubble bursting. That's a lot of value going out of the economy, and a lot of people losing money. That makes investors in general pull their money back. It creates an economy wide recession.
Recessions are never isolated. The entire point of a bubble is that investment capital chases gains. In the 90s it was tech. In the 2000s it was housing. Now we're back to tech again.
When the bubble pops, all those invested in the space are hurt. That means hedge funds, pension funds, etc, and the effects will absolutely ripple through the economy. I doubt it'll be anything like 2008 (which was greatly exacerbated by derivatives trading and so forth), but it will be felt well beyond the valley.