2008 24
Spencer Ante of BW is right
Published by MartinVarsavsky.net in General with No Comments
I was reading Spencer Ante´s new blog (Business Week journalist) about how hard this Tech recession will be and I agree with him. I know it could be wishful thinking as I am in a new capital raising round for Fon that I think that this market downturn will be short lived but as he says the fundamentals are not seriously hurt and this investment levels have been reasonable. As I said the Apple shares fall from 202 to 126 low today are one example of a market going manic depressive with the truth most likely being somewhere in between.
Follow Martin Varsavsky on Twitter: twitter.com/martinvars
No Comments
Gergana Stoytcheva on January 24, 2008 ·
I hear a lot recently about the expectations of a short-lived market downturn because of good fundamentals (not inly in tech but other industries as well, notably the metals and mining). So I wonder why then things are going so badly with the markets and the US is on the high-probability-of-recession cloud. In the past, sentiment played a role but not to the extent where there is a complete discrepancy between fundamentals and the market. The reality is that, with globalization and the internet “sentiment” has become largely scalable and seems to be biting into the fundamentals more than ever before.
A year ago everyone talked about the burgeoning US deficit and how bad times are looming because of it. A year later the US is in the soup, and threatening the world economy, but not because of its deficit but because of a few mortgages gone sour. Who would have thought about it only half a year ago?? No one. So here is the formula: surprise factor+scalable sentiment=recession. So I wonder: will our future economic cycles depend on fundamentals at all, or rather on surprises and sentiment? Do we need to replace bankers and economists researching the fundamentals with specialists on crowd psychology?
manuel on January 24, 2008 ·
The question are : Is this “shock economy” made to cycle till next big disaster or the rest of the world can smooth (read integrate) and give a new global equilibrium? Do fundamentals count as cash versus “sentimental” debt economies? really?
Lucas on January 26, 2008 ·
talking about capital raising, Fon and Apple, It will be cool to see how Fon could play a role in the new strategy of Apple’s wireless computing (without 3g…)
Gustavo L on January 26, 2008 ·
a reader wrote: ……”USA…..because of a few mortgages gone sour”.
With all respect do you have any clue at the cost of living in United States. I live in the San Francisco bay area where a household income needs to approach US$200,000 per year just to make ends meet.
The average home in my area is US$850,000. The cost of groceries continues to rise, the cost of fuel continues to rise, the cost of one beer at a bar is US$6.00, property tax per year is 1.25% of home property value, the cost of sending a child to a private school (should you choose) is US$15,000 per year per child……
The problem is that we have an administration that has sacrificed the fundamentals of this country. As a result most households in the US will suffer. Of course this opens up great opportunities for other currency holders to come to the US and clean house by buying assets at a deep discount. All things being equal enjoy this current sale opportunity in America.
Gergana Stoytcheva on January 26, 2008 ·
Gustavo L,
Yes, I have an idea. I live in London and those costs you are refering to are much higher here.
But my comment was addressing a different issue, the issue of predictability and the question whether we should be approaching economic theory in a different manner, or even reinvent it all together. So my mentioning the mortgages was to point out that while we were being worried about the US deficit something completely unexptected happened and jeopardised the world economic growth.
I completely agree with you that your administration has sacrificed the fundamentals of your country, and, I dare say, other countries for that matter. And it is really a pity because you live in the country with most potential and most creativity!
Leave a Comment
You must be logged in to post a comment.
Brokenglish.blogspot.com on January 24, 2008 ·
Hi Martín,
I am just here to invite you to my broken English blog: Brokenglish.blogspot.com. It’s targeted to Jewish argentinians living in Madrid under the name of Martín. So it’s great that I’ve found you. If you know of another one, please send him the link.