Market Saturation = 98.9% - What Now?
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- čas přidán 7. 06. 2024
- For decades, big tech has been focused on one singular goal: infinite growth. They leveraged every tactic in the book from monopolistic practices, data collection, and even pandering to communist governments to keep revenue and profits growing. But, for the first time in history, it seems that big tech is running into a massive roadblock. The issue is simply that big tech is running out of consumers to convert onto their platforms because everyone is already using their platforms. With WhatsApp, for example, the market penetration is 98% or above in several countries. As such, big tech is no longer able to continue growing by converting more users. Instead, they’re having to focus on maximizing revenue per user. This is why we’ve been seeing more ads, more paid services, and a larger push to monetize users. However, this strategy can only go so far. This video explains the challenges big tech faces as they reach market saturation and the end game for big tech.
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Timestamps:
0:00 - Big Tech Won
2:16 - Stagnation Is A Killer
5:47 - Gen 1 Tech
9:25 - The Race To Monetize
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It's profoundly stupid to me that a company can be enormously successful, absolutely raking in hundreds of billions, and be a household name that has literally spread to everyone on earth able to afford their services--and still be looked at as "failing". Because at the end of the day, the goal isn't to make money, it isn't even to make massive piles of steady money, it's eternally growing investor returns. What a thoroughly broken concept.
It's a fundamental contradiction of capitalism that results in boom/bust cycles.
how is it broken, looking at risk/returns is how capital is distributed to where it is most valued by the market
@@hahahofhahaland3687 beacause you cant grow eternally it will fall eventually
@@B0nd3n I don't think investors assume that every company would grow forever, it's specifically huge companies like apple, google, Facebook that they place their bets on. Most other companies don't have monstrously high P/E ratio because investors don't have much faith. Logically answered himself states that this has happened before to the railroad and airplane industries, and those are doing fine now even after expectations have moderated far away from "infinite" growth.
@@Sjfjfkdk555 the railroad industry is not "doing fine," it's struggling to extract higher and higher profit margins with zero investment in infrastructure by cutting costs wherever possible, reducing crews and maintenance to incredibly unsafe levels across the board.
“Growth for the sake of growth is the ideology of a cancer cell.” -Edward Abbey
But that is not the objective. People need to remember that investors put money into the company wanting GROWTH ifyour comapny won't grow then no one wants your shares and then they are worth nothing. So a company can go from very big to wiped very fast because the competition for the investors is brutal.
careful that leads to communism
@@tiagodagostinicringe
@@tiagodagostinithe stock market isnt real. People's heath, safety, happiness, etc matter more than line going up
@@tiagodagostini well we should just ban using the stock market as a casino, and only let people who will be satisfied with just being profitable, be investors.
A lot of companies don't account for market saturation. I used to work at a Nespresso store in a mall, they always wanted more and more new members and would ask us to increase our numbers. Eventually, we asked everyone who was remotely interested and they still would ask us for higher numbers. I told them time and time again, the mall doesn't move the people don't change, we are saturating the market already. Still, they refused to understand and kept asking us for new members, from where?
credit cards at my job is this too
I saw this delusion at eBay. Their profits would go up every year but the investors only cared about growth percentage increase. It's a doomed expectation. Eventually the market saturated and levels out, and execs would just have gobs of money every year that they didn't know what to do with. They were punished for not having more of it. Being insatiable is indistinguishable from greed. Courting investors instead of improving services caused train wrecks and unnecessary strife and high turnover. I'm glad I got out.
it's doomed for every thing. the world we live on it is not infinite, the resources humans will be able to access within our species lifetime, will not be infinite, our enire economic system is set up around the premise of infinite growth, in a universe where that is physically impossible, and then we wonder why the world is dying and people hate their lives.@@watamatafoyu
Make babies and get them hooked on those coffee-like capsules or whatever Nespresso's flagship product is 😅
A lot of people don't seem to understand basic economics when it comes to supply and demand, unfortunately - even those in leadership roles.
Such folks simply know that growth = good and will push for whatever has caused growth in the past, without understanding the REASON for why that growth occurred.
Given that, it's no surprise to me when such things lead to failure.
It is insane to me that corporations are allowed to just say "we don't like how this makes us look so we're just not gonna tell you"
their books are public, if you really wanna know you can find out for yourself
how so, thats how every single entity operates.
Lot of them are publicly traded so you cant hide your revenue and net income etc.
@@lolithighsDefinitely not, although I’m sure the FBI would love to know the Terabytes of child porn you consume on a daily basis
@@ZuranthusThere are ALWAYS two sets of books.
It's as if infinite growth is unsustainable.
"who would'va thunk" Even the fuckin universe can't grow infinitely without causing massive heat death
people spouting this think it's some kind of own of capitalism, but putting aside braindead management decisions made by individual companies, the only system I can think of that is predicated on infinite growth is the current government's sorry excuse for Keynesian economics, where they constantly borrow against an assumed-wealthier future via inflation, continually-lowered interest rates when the economy is doing well (which is exactly the opposite of what Keynesian economics actually calls for, not that I'm terribly optimistic about it as an option even if it was somehow miraculously implemented in spite of the political impossibility of doing so), and ballooning government debt.
Any austrian-school economist (which is the school that actually represents capitalist / classical liberal ideology) would tell you that this cryptosocialist MMT bullshit is going a bad direction and interfering with any ability the market would otherwise have to self-correct. Hell, much of the shortsightedness (aka high time preference) that these companies are displaying is arguably rational under the system that MMT has set up -- it's like in hyperinflating states where there's a rush on the grocery store every payday because people's money will be worth noticeably less the next day -- seemingly irrational behavior is made rational by a broken system.
I bet you agree with that last statement, but disagree on what part of the system is broken and how to fix it. Care to discuss?
Literally none of that is an argument against the claim that infinite growth is unsustainable.
@@Frommerman if you were replying to me; I wasn't trying to make an argument that infinite growth is sustainable. I was making an argument that issues of assumptions of infinite growth being possible on the one hand and capitalism as a system on the other hand are orthogonal -- one does not imply the other. Statements like these underhandedly imply a connection that's not obvious, and any disagreement you have with me on the matter likely boils down to differing ideas of what constitutes capitalism.
So let me be clear: in your estimation, do the following axioms of capitalism in some way lead to a presupposition of infinite growth? If not, but you still believe that capitalism as a system does, what am I missing?
1. legitimization of a notion of private property.
2. a ledger denoting who owns what at a given time.
3. delegitimization of the use of force to subvert this ledger.
4. (this mostly follows from the above, but it's important, especially in terms of contrasting with communism) allowing the owners of capital to use it productively, including via hiring non-owners of said capital as employees to work on it on a voluntary basis based on some contract, the terms of which are set by the capital owner.
@@ILikeCrunchyWater Capitalism is definitely predicated on infinite growth. This whole video is about how private individuals investing their money into publicly traded companies (ie capitalism) consistently relies on literally impossible levels of growth to justify itself... and eventually it will crash and leave whoever is holding things at the time in the lurch. Regardless of whether you think MMT is good, blaming this on MMT is pretty weird as it has been the MO for capitalism since long before MMT was even conceived. I also don't really think it's accurate to attribute the main drivers of any large economy as being MMT at this point, there are no major governments that are big on MMT.
Far from being "cryptosocialism", if anything, much of what Austrian economists protest is an attempt to save capitalism from socialism by dulling its harshest edges. People don't want to live in a self-corrected market, that's what 2008 was, and there's a reason every government scrambled like crazy to get out of that.
IMO this is what happened to the gaming industry. The growth of playerbase stagnated and publishers began to push predatory monetization practices on the industry to maintain profit growth.
They're also to blame, with their AAA titles that take multiple years if not decades to complete, with graphics and audio that rivals or even surpasses Hollywood blockbuster movies in the number of people required to make them. Then the requirements to play these games are higher than the majority of the hardware people currently own and those games cost two to four times as much as they did only a decade or two ago. Then they wonder why they're having trouble selling those games and recouping their investment for developing that game. And on top of that we get buggy games, incomplete games that are sold in chunks via paid DLC, etc.
So it's not only a question of growth, it's a question of greed and sheer stupidity. That's why I mostly stick with "indie" games these days since those usually mainly focus on gameplay and story and are sold at decent prices.
They also pushed live service upon gamers, and now these very same companies complain gamers want/need more content due to the very problem they had created in the first place.
live service game? content every week. literally.
Creative Assembly through the Total War series is a great example of this. The number of units sold for their titles have remained relatively the same for many years, and the heads of their studio kept finding ways to bring more money per user in because they failed in getting more units to sell. So the frequency of releases became higher. More and more DLCs. Price hikes to these DLCs. Saga titles get higher price tags (i.e. Pharoah). This has led to the hot water they have been in lately.
i haven't even bought a game in 2 years, i'm just burnt out. nothing good has come out in like 5 years other then indie stuff.
@@CirnoBush tbh, buying less/none these recent years have been more of a good thing than a bad thing, there's so many games we don't need, once I took a step back, I realized I need more accessories or I'd rather play my backlog. Maybe building a retro PC for games that don't run well/as good on modern hardware such as Quake or some older WinXP/Vista-era titles.
This is one of the reasons that billionaires are so concerned about declining birth rates around the world. They try to make it sound like they're altruistic, truly worried about the human race; when what they're really worried about is that the markets they've saturated are continuing to shrink.
Fair point but Pretty sure the biggest danger with population collapse is government funded pensions running dry.
Yet they conveniently ignore the massive birthrates in Africa and some Arab countries - where you are allowed to marry your cousin😳😳 But that's not their target market, they can't afford to buy what the billionaires are selling.
Musk has not even bothered to visit the country of his birth, where the majority of the population is living in poverty, relying on grants, and where teenage pregnancy is a problem....
@@pavevbogovev4045
In that situation you either raise the pension age or basically fuck them over.
@@ionpopescu3167 good luck with that lol. French gov suggested it and people rioted
Us just import more people. We take people from countries that are still growing while countries like japan that are more closed doors will slowly decline.western countries all have low birthrates. Luckily alot of the top companies are in the us so people go there to find jobs
Big tech demonstrating what the auto industry learned a long, long time ago. Growing fast does not automatically lead to profits.
It's not that the companies aren't profitable, it's that the companies are not more profitable than they were last year/quarter. It's one of the inherent problems with capitalism.
@@pewpewpandas9203the demand for ever growing returns is also fuelled by inflation. 5$ in 2019 isn’t 5$ in 2023… the investment firms would like to maintain the real revenue year over year
@@pewpewpandas9203 Corporatism. Privately owned companies don't have this problem.
Publicly owned companies have investors, that want a return on their investment. Corporations are getting tons of free money, with the condition that the stock price keep going up. Corpos aren't dependent on being profitable, just convincing investors to keep dumping money in.
@@pewpewpandas9203 No, a number of the big tech companies are absolutely not profitable. Twitter, before elon, was loosing MILLIONS a month. They were losing more money than most people earn in their entire life, every month. They rely on stock buys (aka loans) to continue their growth. Short sellers do this intentionally, build up tech companies, and once they show signs of failing, short sell them into oblivion. Almost every tech company in the world is overvalued massively.
And more rencently, the EVs auto industry, market saturation is reached (at least in europe).
It sounds to me that investors need to understand that there's so much you can do to get people to spend money that they don't have.
Most investors live comfortable lives, because if you have money to invest then it means you have spare money. A lot of people live paycheck to paycheck, so superfluous products and services, which is what all these companies offer, are the first to get dropped.
this is literally how you end up with those cyberpunk dystopias. Companies saturate the market, and so the desire for infinite growth means they have to get more and more monopolistic, and more and more exploitative of both people and the government, until they've been deregulated so much that the sky is covered in smog and acid rain makes it dangerous to go outside. I'm not saying that'll happen tomorrow, but that's where this road goes if we keep propping these guys up.
They will probably start collecting blood for payment, when there is no money left to give them.
It's no longer about getting you to spend money. It's about getting you to give them control.
Bingo. They know this. They don't care.
Overconsumption is in every aspect of our lives. At some point, the well runs dry.
lol, that's like saying eventually companies will stop advertising as we see so many
If you can put someone's advert in front of almost every person in the world, you can pretty much name your price
Nah. Tech companies basically burning investor money, with low return. Good price value for regular users, improving quality of life.
You should watch "limitless growth is possible" by Economics Explained
and declining births (in developed countries) is limiting future growth
@@johnl.7754 I'd argue that's the number one thing
Biggest problem here isnt that the companies will stop growing, it is what they are willing to do to keep growing. Many of the most harmful parts of our society are driven by this problem, including climate change, monetization issues, housing crisis, etc. Not to mention planned obsolescence and the turning of everything they can into live services. Hell, it even plays into wage stagnation and job insecurity.
We know how much absurd waste there is caused by all this, but we just have to keep growing. So we have mountains of discarded tech, clothing and more that are destoying our environment. It bloody needs to change.
Fertility decline, and later population decline, will force the system to change
Planned obsolescence. Capitalism in a nutshell. We could make better products, but if the products last too long then there won’t be any new buyers; they’ll still use the 30 year old model that works!
Im sorry but monetization issues bring no harm to society unless special cases for example privacy concerns. Of course i am talking about tech companies and nor something like healthcare. And tech has nothing to do with housing prices. People nowadays just like to complain and blame problems to anyone other then themselves. There are obviously problems but you not being able to afford a house is not because of youtube putting out ads.
No. We dont need to change, capitalism does@@deaththekid3998
@@hyui5096 "People nowadays just like to complain and blame problems to anyone other then themselves."
So, it's the fault of the homeless that homes are unaffordable? What did they even do to cause that?
Great video. One more thing: our flawed economic system at least used to pretend (and occasionally enforce) competition in markets. Now, everybody seems fine with the complete lack of competition in more and more markets every day.
Microsoft should have never been able to buy Activision Blizzard king
@@TheModdedwarfare3 That would have been a great place to start, for sure.
But that's capitalism no?
@TheModdedsamwarfare3 the same goes for any console/ company then.
The only first party games would be Mario and Zelda. Pokemon, Kirby not sure about others but those are at least second party
@@ddsjgvkMore like post capitalism. Companies buying companies leads to monopolies which eventually leads to the unsustainable market to crash.
Another great one! Funny to see that history just repeats. We're so easily convinced that companies can just grow forever and somehow surprised when they suddenly can't.
This is why the stock market is just a giant pyramid scheme. There is no such thing as infinite growth. Sooner or later you run out of customers.
@DaveHood-xd9uiit's called gathering your money and throwing it off a skyscraper because that's what crypto will do for you
@@LuisFlores-mc2tcevery comment above us was written by a bot, my guy.... ._.
Man, I'm so sorry your reply got spammed by cripto scam bots
@@Gonzakoable ye, it is what it is I guess
It's like late-stage capitalism in general -- We have to figure out another way of measuring and rewarding worth, because we're reaching the limits on what humanity will tolerate from sociopathic economics.
We're probably Close to Something Like the Switch During WW II, after which the taxes for the rich reached extreme heights - I think over 75% for the top income tax bracket Up to the 1970s.
That might be the smartest thing I saw someone comment on CZcams lately. Refreshing!
I swear if you pitch UBI or a social score ill sock u
We don’t even have to change how we measure, we just need to force effective regulation on the businesses we allow to operate in society
Effective regulation.. sure.. we need less regulation
I’m surely predicting that once too many companies go subscription-only (from before was consumer-ownership, now renting) and copying Adobe or netflix, a crash is going to happen.
This is the only way. Make a good product that will last years and make it only available for rent. It's bullshit and I don't agree with it but it would be a way for companies to sustain themselves. But it would also allow other smaller companies who actually sell products to take market share. Preferably it would be nice if there was more reliable competition in the market
It's bad enough that Microsoft word is charging $70-$90 a year for basic features like font.
They're anticompetitive because they subsidize free services on massive losses and the promise of future profitability.
Its becoming increasingly obvious most free internet serv8ces are never going to profit in their current form. So they're either going to create a subscription kind of income and create room for another free alternative to come into the market, or they're going to run themselves out of business leaving an even bigger opening in their nieche.
Heck Adobe is always crashing anyway
That's Software as a Service... It's how everything is done today in software engineering... Or at least the goal of everything.
So if their Goal is growth but the market is saturated, the next logical step would be to grow the market itself. Go to the developing countries, build up stable electricity and telecommunications services. Create jobs and increase gdp, so the people have money to spend. Saturate that new market in the process aswell.
They have been doing that where they can
Also offer new products like metaverse
Lmao so the whole East India company strategy,
That sounds incredibly unprofitable. Wouldn’t it be better to ignore this market and go to another market to invest? Or to buy out other companies in this market or other markets?
That's a long term "solution" which capitalism is very bad at supporting. Doing that wouldn't generate an increase in quarterly profits for quite a while, and in fact would cost the companies in the short term, so there is no way for them to do that without scaring off their investors.
no matter what logic used, infinite growth is just impossible without becoming black hole or void
You should watch "limitless growth is possible" by Economics Explained
Our money is based on infinite growth.
Given that "ideas" and "knowledge" are valuable, we still have quite a high margin of technological advancements and innovation before reaching saturation of what humanity can handle in amount of knowledge.
In fact, even without population growth, we're still far from the maximal "invention rate" that we could have since the quality of education in most countries is subpar, leaving a lot of peoples with unused potential.
But all of that is long term growth. The exponential growth those companies need will always be severely limited.
@@MoiMagnus1er tech can not advance in vacuum, development cost material resource and its finite, at least in earth. And our consumption rate for material resource is already above earth natural cycle of unmaking and remaking the material, so we might extinct before we reach that advancement.
@@playnochat yeah, mathematically the concept of money can reach as close as it want to infinity (something something about integral, I guess)
But money without relation to resource mean nothing and our resource is finite on earth.
These companies make more money in 24 hours, than I'll see in my entire life. It's kind of hard to feel sorry for these corporations when they do everything in their power to screw over their users.
Sure that you don't mean a single hour?
I'd say apple net profit in 14 minutes is more than 60 years of average US gross salary.
They make more than entire contries
I learned in high-school that corporations are required by law to grow as much and as quickly as possible, without restraint.
My reaction was .."that's not realistic. And thats literally cancer."
That was in economics class in the 90s..
.the other thing I learned: the weed dealer had all the money at the end of the stock market simulation. I was uninterested, so i gave him my stocks, he made us both "rich," at the end of the class
What law?
@@RT-. Civil law. Caremark is one such example.
@@RT-. A good example is Twitter. You think Agrawal honestly thought Musk would be good for twitter? Or did he have a duty to present Musk's ridiculous offer to their shareholders, and indeed pursue that offer once improperly rescinded?
Its incredible how Investors and shareholders are the blight of everything they touch
They're the mustache twirling villains of captalism.
@@mynamesnotshanekid813they're literally capitalists.
Yet they call themselves "high performers" and call anyone who dares criticize the system and campaign for more equal distribution of wealth "parasites"... 😪
Everyone keeps passing the buck. If you've ever put money in a 401K, you are an investor. And if you don't invest, but keep your money in the bank, it's the same as keeping it under your mattress. Inflation will devalue your savings over time.
@@shorewall What savings? lmao
The main problem is the expectations of investors. They expect ever increasing numbers at an unrealistic rate which I can understand that they want profit, but nothing lasts forever and expecting infinite anything is a mindset rooted in a fantasy.
You should watch "limitless growth is possible" by Economics Explained
The amount of resources on Earth and the maximum number of possible consumers is finite.
Do you want to retire one day? Most investors aren't getting rich, they are securing their retirement.
Delaying gratification is too hard for most people, if the money didn't grow most would work until they died.
Most tech companies have this as a problem because they're built off of growing their market share as a loss leader in the hopes of magically becoming profitable later.
They're asking for it by not making any money but spending plenty
The funniest part about this is some people think the top tech companies won't ever crash and fail to return to their highs even though it's happened in the past with the top players.. I suppose it's probably why the vast majority of people never beat the market. Too much greed and ego.
It's like none of these fuckers went "Hey, Google, what is a market bubble?"
This is what humanities greed looks like. These companies are super successful and investors say they’re doing a bad job because grown is stagnating. Despite market saturation. Insanity.
I've been saying since high school that a company's goal should be sustaining their operations and workforce, not growth. Investment-based business demands constant growth and once a business matures, becomes harmful to its daily operations and long-term performance. It's part of why I strongly believe that stock should only be able to be held by those that are primarily employed by the same company, and limits should be placed on the pay gap between any members of a corporation. That way, we might defeat vulture capitalism.
How many businesses have been in operation for 100 years? 200? There's one in Japan that has been in operation for over 1400 years. Now, we can't owe that to anything specific because we could fall into survivor bias. Many times it's just luck. But, maybe we should look to companies today and ask "what foundations have you laid to ensure your operational security for the next 50 years", "do all of your current strategies support your long-term goals", and "how do you prioritize providing stable careers and supporting your workers to retirement?"
#1 thing people forget, if I remember right, somewhere around half of all fortune 500 companies fail every century or so. They build, and then collapse under investor stupidity. The best thing you can ever do, is never, EVER, go public. And this trend has started recently due to so many companies collapsing due to activist investors, on both side of the political spectrum.
Good way to get exterminated from the market and replaced by a company that WILL try to grow infinitely.
The key is removing venture capital from uninvolved third parties, for everyone. When only the workers can hold stock after a company is founded and begins operations, you can't have the same explosive 'growth at all costs' schemes that not only promote, but demand toxic corporate behavior. Companies should grow from their profits and benefit their workers, not exclusively through turning economic sectors into gambling parlors and holding popularity contests. Companies that operate successfully and employ a large number of people should deserve to have access to a larger financial pool. Those that don't... well, should they? @@thewhitefalcon8539
A company isnt crested to last, just to generate money for the investors and for the creator
A lot of companys now days are crated with a short life span in mind because they are only a mesn to an end
They can always decide to start paying out dividends and be a tech "utility".
Yep
That’s what apple and Microsoft are doing, they have a gradually growing divedend
@@its9333 not in my watchlist right now until they're over 4% yield. Both of them don't even have 1%. I'll check back with them after maybe 5 years. 😊
@@its9333classic Gordon growth model.
@@its9333their dividends are less than 1% per year, which is fuck all, youd be losing money due to inflation
Microsoft is doing what Disney did, buying up anything they can in hope it will keep them afloat. If their purchases one day starts failing, they're going to be in huge trouble.
Yeah very true, Disney is definitely struggling with that
Are you just referring to Xbox? Who all has Microsoft been purchasing outside of gaming?
@deelowe3 referring to Activision\Blizzard. They ran out of pc users so now they want to own all of gaming.
But Activision\blizzard is in the same boat and following the Google playbook of milking the userbase. Which they seem to have already getting close to satirizing.
(They make oceans of money but GROWTH they can't maintain)
@@deelowe3
Github, Nuance, and LinkedIn are their biggest recent non-gaming acquisitions. Its quite a diverse lineup: A coding repository with CI/CD and a dedicated community with lots of project history; A healthcare software giant with lots of enterprise offerings utilizing Cloud+AI to produce Dialogue, Text-to-Speech, and reporting; and LinkedIn which is the worlds only relevant professional social media platform.
Microsoft has one thing that none of the others have though: Governments. And I don't just mean bureaucrats using MS Office. Microsoft has massive contracts with governments worldwide for database backends, military technology, etc. Most governments in the world are frighteningly dependent on Microsoft. While this is not their core business, it is a virtually guaranteed business. Microsoft will, as it stands now, not even be allowed to fall.
Opinions on the market diverge; some claim overvaluation due to rapid gains, while others cite strong economic fundamentals justifying high valuations. Raises concern for my $600K equities going 8% up and 20% down. Should i hold on or sell off my positions and hold cash?.
I agree with you. I started out with investing on my own, but I lost a lot of money. I was able to pull out about $200k after the 2020 crash. I invested the money using an analyst, and in seven months, I raked in almost $673,000
'Vivian Carol Gioia' is the licensed advisor I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
@@PatrickLloyd- "deez nuts on your face" is the licensed advisor I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
Strongly recommend 'Vivian Carol Gioia' she told me to go all in poopeycoin and it 1000000x. I'm now a trillionaire looking to invest in startups. DO you have any recommendations?
wtf is with these weirdly formal financial questions I see on almost every video related to the economy? It almost feels like someone’s farming user feedback to train an LLM or something
We need a movement to get people off of social media all together.
I’m so glad to see this comment. I miss the Internet before social media.
It definitely needs to happen, but I don't think it will. Its how most people get their "news," communicate with friends, date. It's all really bad and I don't think it's going to get better
Try calling/texting people and writing things down. Works wonders. Turns out that if you get rid of social media, you just have to... socialize. Scary prospect, I know.
I don't actually think social media needs to go. We just need far, far smaller groups. Make a private Mastodon instance. Host a message board for your friends. Schedule physical visits weekly. There are excellent solutions, but you have to champion them. For most, it's a matter of energy and effort, rather than will. @@aaron0000123
yeah getting off social media is healthier than drinking more water
How are you going to spread the moment without social media?
One thing different now from 2000s is participation of population in share market. Now 58% of the US population own shares. Now there are just more people who invest money into stocks which causes this sky high valuation. And when there is a panic, like the start of the pandemic, it causes a sudden crash because everyone looks to cash out.
There's also institutional investors like Softbank who throws money at startups hoping a few actually make it. The whole finding the unicorn has caused a huge problem.
@@snowlockk3464 this will all rad to crashes in 2024 how to make money from this ?
@@snowlockk3464I will continue to buy food and energy stocks that pay dividends. 😅
Well with stagnating wages and rock-bottom interest rates, investing in tech bubbles is pretty much the only way to grow your money. So you get those giant ridiculous bubbles and crypto crazes.
Can't blame middle class Americans for trying to play that game, even if it's obviously going to be a losing proposition long-term.
It definitely gonna be more volatile
This is what happens when you run out of things to speculate on. Shit comes back to reality.
This is why comapnies are beginning to expand into new markets (and even create new ones) in order to meet the infinite growth promise. Apple dipping into virtual headsets and even offering a credit card are prime examples of how they’re trying to counter it.
Short-lived fixes. You're missing the point. The whole premise was flawed from the beginning since infinite growth can't exist. And the irony is that it greatly robs all of us in the longterm to have these narrow/blind profit goals.
Where are the new markets? The poorer developing countries do not have a population size that would make any difference to the bottom line. Countries like Nigeria, already have these services. Where are the new markets that can make an impact on profitability?
And how forget of the apple car
@@maximillianafrancine1451 I'm assuming Asian countries for now (India, China, etc.) whose living standards are going up. But all its doing is shifting value over to those countries ... just as value was shifted over from Europe to N America during the 20th century. It's a game of musical chairs that can technically go on forever.... except that the world doesn't have infinite resources to exploit. As things like precious metals, oil, even drinkable water become scarcer the game will unravel. .... we need a more intelligent form of management.
@winterhaydn India, China already have these products WhatsApp etc. The number of people who can't afford them in these countries is not enough to make any significant difference to the bottom line, I think. Maybe be wrong, am not an economists
This seems to be a fundamental problem with publicly traded companies. Private companies don't have this struggle. Profit is enough to justify their existence without significant growth.
What would happen if google and meta etc. became private companies?
The tech companies need to promote planetary colonization to continue growing market share
fr
Or you know, for the good of our species.
There are no planets. It’s all a hoax
Arent Amazon & Tesla trying to do exactly that?
That'd actually be a good idea funny enough but they are incapable of making even the smallest sacrifice. They are obligated to take only the low hanging fruit.
This is why i only work for companies with a stable growth and a clear endgoal they are going to get really valuable soon
This is why I work for the government. There will always be landlords doing blatantly illegal things to their tenants. That's what I call job security.
@@Frommerman that's barely a reason to work for the government especially when government has been known to be pushing racism antisemetic ideas and flat out war at the cost of your life first and my life next
@@Frommermanthis is why I work for mafia: there are too many poossies and not a single one without pronouns in bio.
Thanks. Always love videos that zoom out and give the big picture that people aren't talking about. This video does a great job of that.
Layoff is the path majority of these company you just mention took to grow profits, and many of them are struggle to keep it afloat with lesser employees. It’s a transitional period for these tech companies that banks on infinite growth.
big companies invest in small companies, so they actually own more products than you know
Rivian says hi
Right, but they don't do anything with them and just let them rot. They only want the competition gone. Where is Skype today? Does anyone still use it?
@@1InVader1 I take your point, hope Microsoft will learn from that. I don't mean acquisition though but Microsoft acquired GitHub and LinkedIn and they're doing fine.
Re: investing, Microsoft has invested in OpenAI for example. My point is in response to the video which says FAANG companies don't have new products... but if you think about it, FAANG own new products that are growing by investing in them. Hope this makes sense.
@@1InVader1having a moat comes with a price. And being the leader, you have pricing power. So in the end its all worth it
@@harrellt1405 The idea should be to expand to new markets with a new product range, not to cannibalize portions of the market, which only leaves a void for a competitor to fill - in this case Discord. Why do you think Apple is entering the car business? Cuz that's a new market for them, where they can still grab a slice (or so they think). At the time when M$ acquired Skype, it was competing with MSN, which was already on its last legs, although Skype has already started rotting long before they acquired them. They spent money on acquiring competition and ended up losing both the competition and their own product.
Thank you for another insightful video, Hari! Your channel is right up there on my favourites list and I can't always comment, but am learning so much from you 😊
Really glad to hear that man! Hope I don’t disappoint
Thanks for standing back and giving us your perspective. Much needed.
Dude honestly I've been watching you for awhile now and man are your videos are top tier, like you are criminally underrated
🙏
Hey Hari, just wanted to say your videos are always on point - super informative and engaging. Really appreciate the effort you put into these. Keep up the amazing work!
Thank you so much for your kind words Sunil! Gives a lot of motivation to keep going!
this was one of your best written essays in a while Hari, thank you!
🙏
8:00 Sony for one example at least very much DID drop the ball. the portable MP3 player market should have been their success. this is where they went off the track as a personal electronics company. the iPod laid the track for the iPad and more importantly the iPhone's success. the fact everyone's carrying Samsung and Apple phones *is Sony's failure.*
I'm pretty sure this happened because the music division of Sony blocked the electronics division of Sony with all the DRM bullshit. The music division went as far as basically installing a rootkit on people's computers to prevent them from ripping audio CDs.
Internet Explorer & Hot mai is Microsoft's walkman. They should have been the market leader. They dropped the ball. However, Microsoft found new Avenue to earn profit, like azure. Even, Windows is in slow decline. I'm seeing same thing for Tesla. Stock price hardy resonating with net income.
They wanted to keep selling you discs, that was their downfall
It's going to be interseting to see the inevitable enshittyfication really kick in once any sane ways of increasing profit have well and truly been exhausted, and the snake will be forced to eat it's own tail. Might be interesting times ahead when companies with this much power absolutely positively NEED to make more money but start to become unable to.
So basically all tech giants are overvalued by 3x
Depends on if they can keep growing
Bro your channel is just so good. I love it. Maybe you can make educational videos like what is a PE ratio in more detail. You do a good job explaining the terms in a very casual way
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This is also what happens when "personal information" wells eventually run dry.
When I was active in the VR field I finally came to the conclusion that way too much pressure put on it to be the next iphone or something. Currently there's a pretty big demand for better headsets, better full body tracking, better haptics, way more software features in social VR for interactions, performance and graphics. All of this would have been enough to make an entire industry at any other point
The only kicker with that, is its not a large market due to how god damn expensive it is. Its bad enough building the PC to run it, then you have to buy the kit. Its a limited market to start off with, and it will only get more limited in time. That, and quite a few gamers just do not care for VR, like, at all.
Thanks for this infomative video.
I think the problem is not in these companies, but rather in the stock market and somewhat how the business works. If investors stop over-evaluating a tech name such as Apple just for the sake of beging Apple, the CEOs won't have to catch up to their fictitious expectations by chasing an infeasible ever-lasting exponential growth curve. The result would be a more stable tech world where companies won't crash every 20 years or so, the users wouldn't have to deal with ever-worsening monetization policies, and lastly (a large portion of) the investors wouldn't loose a load of money at the expense of the others making fortunes out of thin air.
But what do I know about business, I'm a tech guy!
when its not enough to make an incomprehensible amount of money and you need to have literally more than 100% of the people on the planet signing up for your goods and services
Maybe they've run out of new users to adopt but they can always create more services and products to sell to their massive userbase. Google, as you've mentioned is late to the game but the brand equity they've built up over the years has proven to be very beneficial when convincing consumers to switch to something like their Pixel line of hardware.
But that's only kicking the can down the road. There aren't infinite consumers and there isn't infinite money. What happens when the baseline money big tech needs to continue growing is more than their consumers need to keep to live?
Then the consumers start buying things they do not need. This has happened before and continues to occur in our consumerist world, and is largely driven by overproduction and aggressive advertising.
@@elweewutroone buying shit you don't need with money you don't have is the fundation of right wing capitalism.
I DONT want umbrella corp
At least Google does a great job of having competitive products compared to other techs. For example their photo translator (which is free) is one of the best and most common out of every translator.
These companies clearly grew too fast. They should be able to moderate most (if not all) of their content properly but instead they maximised investor returns. Now there's apologists saying "it's too much content to moderate" without realising that's the company's fault and it should be their responsibility.
Time to harvest. Prices for premium things will come. Charges for people who use fb for their business will come eventually.
Yeah probably, time to monetize
I am asking for no reason, r u by any chance gay?@@LogicallyAnswered hehe
Hauri’s on top of trends as usual and for this reason his channel is growing!
Hahaha, thanks as always man!
I greatly appreciate a video like this over someone just giving their opinion while using in game footage to keep people engaged. Seems like the latter is happening more and more
At some point... companies should reach a stable condition with a positive attitude of "we are fine, customers are happy, workers are happy, owners are still earning stable money. This is good, we are fine"
After you dominate the consumer space, you move towards the commerce space. While, finding ways to sells ads to consumers. Since there aren’t many competitors in whatever space you dominate, consumers are forced to use your app, even if it now includes ads (which decreases the trust and likableness of a platform).
It sure is a shame nobody in the 1800's warned us about seeking infinite growth of markets...
extremely well thought out perspective. Excellent video.
Thank you. Interesting topic. You've presented the information in clear, logical short segments. Well articulated. Also a great voice for this type of presentation. I have subscribed.
I like the phrase to big to fail, but this is a case of to big to continue.
I wish I learnt most of these principles about seven years ago. A lot of people have been trapped strongly in the matrix-- Go to school, get a job, and then slave your whole life. Many miss out on life-changing information that could have great effect on their finances. I played with the stock market sometime in 2020, and I was surprised at how well it turned out. I want to put in $90k more into the market. I heard people are making really great returns despite the downturn. Any recommendations?
Avert too-good-to-be-true con tricks. Consult a fiduciary counselor; these professionals are among the best in the business and offer individualized guidance to clients based on their risk tolerance. There are undesirable ones, but some with a solid track record can be excellent.
Yes, I've been in constant touch with a Financial Analyst ''Mark Stuart Jordan'' for approximately 8 months. You know, these days it's really easy to buy into trending stocks, but the task is determining when to sell or keep. That's where my manager comes in, to help me with entry and exit points in the industries I'm engaged in. Can’t say I regret it, I’m 40% up in profits just in 5months with my initial capital of $160k
How can one find a verifiable financial planner? I would not mind looking up the professional that helped you. I will be retiring in two years and I might need some management on my much larger portfolio. Don't want to take any chances.
Big Credits to ''Mark Stuart Jordan'' he has a web presence, so you can simply search for, there are some others but it might be difficult to get them, but Mark Stuart Jordan has been a good guide through the year.
I just looked up Mark Stuart Jordan online and researched his accreditation. He seem very proficient, I wrote him detailing my Fin-market goals and scheduled a call.
3:15 I mean companies as a whole don't need to worry about stock market valuation unless they want to issue new shares, only the shareholders must be worried.
And the CEO, whose pay is directly indexed off the stock price. And they decide what the company does.
Opinions on the market diverge; some claim overvaluation due to rapid gains, while others cite strong economic fundamentals justifying high valuations. The notable surge in tech stocks, raises concern for my $600K portfolio given the index's increased tech concentration. What stocks, in terms of growth over the next ten years, could be the next APPL is my query.
If there's a correction in tech, it could have a ripple effect on the entire market. But doesn't the Federal Reserve's monetary policy and low interest rates contribute to the current valuations? Meanwhile Employ an expert if you’re uncertain about your portfOlio
Market behavior can be complex and unpredictable. Mind if I ask you to recommend this particular coach to whom you have used their services?
I searched for her name on the internet, found her page, and reached out via email to schedule a conversation. Thank you.
Infinite-growth capitalism is strangling the world.
Why are people like this?...if i had an investment that made me 1 million dollars a year I would just sit back and enjoy life.
Power
Wow, this is a fantastic video. Super informative, clear and well presented, and just totally direct and to the point. 10/10
Some real high intel research my man. Props.
i think now their goal shifts from growing to staying relevant. also they can always minmax their revenue based on the customers they do have, or introduce new services that they can grow.
the current economic model of profits for infinity is insane. Break up big corporations, prevent monopolies and promote worker owned companies. Enable the desire to innovate be motivation for discovery.
Sadly, our consumerist world will take a lot to change into being a socialist, sustainable one, since the modern-day ‘robber barons’ have de facto bought power that they can use to keep us from changing our socioeconomic systems into being sustainable.
Humans are selfish and thats what make us innovate.
well made video and nicly added ata, got a subscriber
I wish you went into more detail about the history of AT&T, Verison, and other companies, and talked about the similarities you expect to see with FAANG companies in the future.
I hate how people think in the US. If you are already making a constant amount of good money, what is the need of keeping growing? You can only grow so far and if you try to grow in ways that harm your users, in the end, it could be worse to you.
The only importance is to maintain a growth in the sense of being something the next generation will want to. It does you no good to live and die by providing something people from one decade will buy.
This why people need to rebalance their investment. S&P500 and Nasdaq have enjoyed huge increases for 2023. It's time to rebalnce some of these gains from these large companies into mid and small sized companies, like s&p 400 and Russell 2000 index.
Could be a good idea
First time viewer! Nice vid! I didn't realize scaling for many companies isn't possible. Makes sense to me, you eventually run out of McRib fanboys and sales stagnate. And STAGNATION means stale taste so product is sidelined... So sad... NOT!
It's like an electrical circuit, when the circuit first forms you get a surge and a series of rebounds as the electron flow balances out into a steady state. Similarly, the exponential growth of companies in a new industry can be seen as the surge - and the correction afterwards is simply it settling into a steadier, stabler state. Some companies won't survive the correction because they set themselves up to fail in chasing growth, but others will adapt and solidify into their markets.
Not like growth is necessarily going to stop entirely either, especially if something happens like we start colonising the solar system and population explodes again.
Nice work!
Thanks for being early bro!
@@LogicallyAnswered anytime, was like 6am in 🇦🇺!
Cisco doesn't really fit into the same category as any of the other companies mentioned. Unlike Microsoft, Cisco's software only runs on Cisco hardware or virtual machines ("the cloud"), and unlike Apple, Cisco is exclusively B2B. Most of Cisco's revenue is from service contracts, but purchasing hardware and licensing software are insanely expensive ($30k for a firewall for a small office). The "race to monetization" doesn't really apply, unlike with money-hemorraging social media platforms and other SaaS startups.
Left my computer science course because I just saw saturation right on the horizon of 2019.. I’m very much so glad I stuck to my guns because there will always be a tech company in need of an employee for a slot and between 100 to 500 people spplying for that job at that company. It’s very competitive. Any industry is but the last few years really made CS. seem like one of the most promising degree
Very good video and insight.
Sounds to me like the company value evaluations are not done right due to not accounting for the known growth limit. So these companies are trying to maintain something they never really had in the first place. This sounds like a problem of (managing) expectations rather then a problem of the companies failing.
Yes… but whose expectations…?
The company and its investors dude 😂
Oh, so this is why Musk and Bezos are saying the human population isn't big enough.
Yeah, these companies have become so large that their problems are now the problems of countries, like demographic stagnation. Iirc both Amazon and Walmart have internal economies larger than the USSR at its peak.
Excellent quality content.
More than any other video I have seen I think this one shows all of the basic concepts and mindsets behind investing. Even though it only implies they exist as the video's actual topic is something else entirely.
Greed is a hell of a drug
This is why I never had problems with monopoly’s. This is a tale as old as time, nothing last forever. If you look at the 10 most valuable companies 100 years ago, you’ll see that they are pretty much non existent today. Most of these monopolies came to be because they were pioneers in their respective fields:
Oracle: google, CZcams
Meta: facebook
Amazon: online shopping
Apple: Modern smartphone
Netflix: online streaming
Etc.
These companies were not fated to last forever. The next one aren’t either. I just hope that the new ones bring more innovations like these titans of industry have done.
This is working as expected. Market speculation is necessarily an imperfect process. The answer is that these companies have been overvalued, and the correction is now underway, after which they will simply hit a stable equilibrium point. They won't disappear because they will be sitting at the correct valuation.
Excellent review! Thanks.
I kind of disagree with you. The amount of compute and infra that big tech has built over years is very hard to replicate. They basically have a planet wide coverage. As other business scale they'll be relying more and more on them to scale and grow. Big tech will require a disruption in science to stagnate.
Interesting perspective Gaurav. Do you think a new generation of tech companies will ever replace the current big tech players?
Obviously, some new players can dethrone the current big players. No one expected Myspace, Nokia and others to go obsolete.
Cloud capitalism😅😮
@@thompsonoboyi4125wrong, you have to make the argument based off big giants like, “No one expected att to fail” before you can even touch the large tech giants. So as long as even older legacy companies are around, you’re not getting rid of any of the current tech giants, there’s definitely a hierarchy on which fails first when it come to large corporations and legacy companies.
@@henrytep8884 that makes sense though.
It could probably turn out that way
Just checked Tesla and Amazon. Both have PE ratios around 80. Yikes.
Good video. Explains most of the corps' behaviour.
This is a very interesting phenomenon, thanks for sharing!
They are diversifying into energy/realstate and more
The problem is that stocks are speculative and as such, they rely on emotions rather than productivity. I would say, it is like a pyramid scheme. At some point, it will reach a limit and some will lose money from there.
Great video, learnt something new today
Very interesting view on the economies of the big tech companies. I have always thought that focusing on # of users instead of profitability was one of the major mistakes of tech companies.
bro all they want is damn money
Who doesn’t hahaha?
But eventually they'll realize they have enough. Oh wait, They already have more than enough.
true @@LogicallyAnswered
The day i get my company to S&P 500, i'll make it compulsary for my top mangement to watch all of your videos. And even conduct quizes from your videos.
😂
Hahaha
Your market interpretations are... Very original
Well done!