In The Before-Time, The Long Long Ago, prior to The Great Dot Com Bubble Bust, newspapers (remember those?) were filled with reports of day-traders, ordinary people who quit their day jobs to trade stocks. And what do you know! A whole bunch of them made money doing that! They must have been geniuses!
Few paused to test an alternative theory: They just happened to be riding the tail end of one of the greatest stock bubbles in history. It’s easy to pick stock market winners when there are lots of winners around.
Then the bust hit, and a whole lot of geniuses turned out to not be so smart after all, especially those who had backed such companies as Flooz and WorldCom.
Thanks in large measure to the SUPERgenius economic management of the Biden Administration, the world is now exiting an era of historically cheap money and entering a period of rising interest rates. A whole lot of business models that seemed to make sense during an era of cheap credit are going to look as retroactively foolish as Pets.com.
Example the first: Vice Media is looking for a buyer.
Vice will be mounting a new round of cost-cutting to try to stretch out its solvency while it searches for some sucker to buy it.
Vice does not make money. It will never make money. It just wants a series of Sugar Daddies willing to pump money into it forever to keep its overpaid, underperforming staff paid.
Snip.
The article says that they can only estimate what Vice is worth. They guess it’s worth, maybe, “at least one billion.” (And they owe $1.1 billion in debt?)
It was valued at $5.7 billion just a few years ago.
Ace of Spades also posted this Ryan Long video that I’m absolutely stealing:
As for the next media outlets to close, well, I’ve got to think any Bulwarkesque outlets whose entire raison d’être is subsidized Trump-hating is going to look like a luxury good during the Biden Recession.
And Crunchbase keeps a running list of tech layoffs.
Another sign of the serious straits people find themselves in: Consumers are maxing out their credit cards.
High debt, high inflation and high interest rates are all recipes for disaster. And as those pools of liquidity dry up as cheap capital recedes, all the stranded starfish that so briefly thrived will find that they have no place to hide in the Biden Recession.
Allusion in headline: