Tuesday, April 10, 2018

Zuckerborg Shrugged

The "great men" of our time are unfortunately, con artists. Most of what passes for "progress" today, is just corporate self-destruction...

"Picture you're in a large room full of cool people from all over the world, having a really good time"

Way back in 2012 when Faceplant went public, many of us believed that it was a passing fad. It was one of the biggest IPO disasters in history losing -50% of market cap in the first few months. But then a funny thing happened - they figured out how to "monetize" their user base, so the stock subsequently went on a multi-year mega rally. Facebook users can now discover their identities propagated across the internet an unlimited times over. No surprise, regulators finally want to cap their ability to data mine personal information for fun and profit. Unfortunately, that is their business model.

Facebook is yet another example in which hairless monkeys have reinvented the wheel by taking a well-functioning industry -  print media and publishing - and replacing it with a low quality substitute. In the name of "progress". Similar to replacing sugar with corn syrup. Everyone gets fat, happy, and dumb as fuck inside their own custom echo chamber. 

Of course, another big problem in mega cap tech land is Amazon. Which is now under long delayed scrutiny for its predatory business practices. Back in the day when the adults were running the show, before the *free* trade dumbfucks took over, there used to be an antitrust law called predatory pricing. Which meant that a company could not sell at a loss in order to drive the entire retail sector out of business. Which is what Amazon has been doing for 25 years straight - garnering ZERO cumulative profit. 

As long as they showed top line growth by taking market share from the real economy, Wall Street was A-OK with their predatory cannibalization of the entire fucking economy. 

The anti-regulatory, business zealots will be very happy with the timing of this long delayed regulatory scrutiny. When they emerge from bankruptcy with zero net equity.

In other words, two more examples of self-destruct mode hard at work.

However, there is no greater example of an industry hell bent on self-destruction than the oil industry. Cheap capital, over-invested in the shale industry, led to the first crash in 2014. So, what did they do? They borrowed more cheap money to re-invest in over-capacity.

Then they ramped up production to new all time U.S. highs. What would anyone with an IQ of 5 do?

Deja vu of 2014, the oil industry is now attempting to bid up their own assets, in order to stave off bankruptcy. It won't work. 

Don't ask me how I know.

One more thing to add to the list:

"Why is it getting so volatile? Any ideas?"