Monthly Archives: May 2016

The Big Picture for the Tech Economy

Amazon and Facebook have reached all time highs but their success may not actually be good for the economy, in fact its probably pretty bad for it. Pretty regularly the two tech companies are seeing their stock sour other big names have reported their first quarter earnings below estimates and are struggling with falling numbers. Macy’s and Disney land are the two most recent corporations to be slammed in recent weeks. Some inside traders can’t help but wonder that the internet giants are to blame.

Amazon is shaking up everything, and is changing the way people buy and sell everything. The brick and mortar are no longer the necessity they once were. “Amazon has a huge impact on employment, on rents and on downtown usage, we’ve seen mall retail effects here that are nontrivial.”

More over, their vast online retail sector that Amazon has also introduced a myriad of services, over the years to compete in a variety of markets. The company is also now expanded to include not only their Amazon Prime swag, but also their grocery delivery service. fgfgfg

Facebook, is also for the most part expanded beyond its core social media platform which is becoming, an ad revenue generating powerhouse which is thanks in large part to its huge reach and scope. But that seems kind of obvious.

“So Facebook and Google control online advertising and Amazon is 30-plus percent of e-commerce, so what’s a bit counter intuitive about these new and exciting technologies that are making everything competitive is they tend to be very dominant.”

But the true scope we are trying to understand may be harder to see than originally believed, but that’s fine. Especially, given their reliance on the internet and their vast reach across burgeoning markets.

“There’s a big disruption going on and economists really have trouble quantifying it in terms of productivity growth, which at the end of the day is important for economic growth. There’s an old saying that you can see the internet every where except the productivity data, and you’re definitely seeing that play in the stock market as well… You have disruption but it’s not yet crating the kind of growth that we had either in wages or in the economy with prior technologies like in the 1920’s and 30’s.” Colas added.

So we are in between a rock and a hard place for our economy. In once sense we don’t really want to break away from Inc. logos are displayed on laptop computers in Washington, D.C., U.S., on Wednesday, Oct. 23, 2013. Inc. is scheduled to release third-quarter earnings on Oct. 24. Photographer: Andrew Harrer/Bloomberg via Getty Images

this trend because of the convenience and speed inherent to its model. However, it is clearly a kind of means to toxicity in the market place and among US consumers. So where they decide to go from here will only tell of the coming change we see across the board both in distribution and manufacturing.

What is going to be interesting is what the face of Facebook will be in a decade and how they will continue to monetize their product. What I mean is that this is largely a market experiment so we’ll see how it goes down in the town.