[HN Gopher] The FAANG Market Is Fading
___________________________________________________________________
The FAANG Market Is Fading
Author : woldemariam
Score : 82 points
Date : 2021-12-04 16:29 UTC (6 hours ago)
(HTM) web link (www.morningstar.com)
(TXT) w3m dump (www.morningstar.com)
| Retric wrote:
| "So, to create a more useful comparison point, we're excluding
| those three years from our long-term average."
|
| Sure, look at a few years while excluding ~1/4 of the data and I
| am convinced your analysis is just great.
| neilo40 wrote:
| FAANG is dead. Long live MANAMA! (Microsoft, Apple, Netflix,
| Alphabet, Meta, Amazon)
|
| Silly, I know but I've always wondered why Microsoft was left out
| of the original 5
| [deleted]
| it_does_follow wrote:
| > wondered why Microsoft was left out of the original 5
|
| Same reason Cornell is typically left out of conversations
| about Ivy league schools.
|
| It's just not that prestigious. Seeing MS on a resume is not as
| impressive as the others, and that's also reflected pretty
| clearly in the comp. It's not nearly as competitive to get a
| job at MS. The stock performance over the past decade has been
| pretty meh compared to the others.
| bradleyjg wrote:
| > The stock performance over the past decade has been pretty
| meh compared to the others.
|
| MSFT's ten year total return (1482%) is better than AAPL's
| (1256%) or GOOG's (815%), but not as good as AMZN's (1629%)
| or NFLX's (6250%). FB hadn't IPOed yet ten years ago.
|
| This is per a site called finbox.
| lotsofpulp wrote:
| Per this website, AAPL has a 32.79% annualized return, and
| MSFT has a 31.84% annualized return over the past 10 years,
| dividends reinvested.
|
| https://dqydj.com/stock-return-calculator/
| bradleyjg wrote:
| Thanks. Don't care enough to do a deep dive but it seems
| like at least MSFT is in the pack.
| eggy wrote:
| How is Cornell Tech's campus doing at Roosevelt Island, NYC?
|
| Microsoft has some really cool stuff going on aside from .NET
| Core. Simon Peyton Jones has been there since the late 90s
| working on Haskell. Some notable ones for me: F#, F*, Z3 (SMT
| solver), C# and its ubiquity in products like Unity, WSL2, VS
| Code, etc...
|
| What's up with Hololens 2? Any uptake? I would like to make a
| short video of the ultimate PC vs. Mac parody with two armies
| facing each other with one wearing the stylish MR glasses
| coming from Apple vs. the more typical-looking HMD Hololens
| for nostalgia's sake.
|
| I have been in computing for a long time, and all of my jobs
| have been on PCs with Windows other than the weird Banyan
| Vines, VMS, Irix, and QNX systems I have worked with over the
| years. All my graphic artist friends had Apple products. I
| have had one job where I used Quickbooks on an old Apple
| Macintosh (1994), but not much else with it. I did put a
| deposit on a NeXT machine, but that fell through!
|
| I have had a computer since 1977, a Commodore PET 2001
| followed by a Vic-20. A Toshiba dual-floppy laptop that
| probably wouldn't fit under the seat in front in Economy
| Class seating. My first Apple was a Power Macintosh in
| 1995/96 (I think the 7200) on which I loaded Minix or some
| Minix derivative at a later date, a pen-based NCR 3125.
| Amazingly slim for the time, and I updated the drive in it a
| year or two later. My first real micro-electronics project.
| The Newton came out around the same time. The NCR 3125 was a
| 386 running PenOS that I eventually put Windows with pen
| support on. Various PCs I built (a RAID 0, Dual-Athlon
| anyone?) in the early 2000s running Blender3D. I donated $50
| to support Ton's efforts to take it open source back then.
| And so on...Microsoft has always had the tech, but not the
| marketing or style of Apple. I currently use a Windows 10
| gaming laptop, an old Lenovo running Kali, a 2011 iMac (1TB
| HD! 16 or 32 GB of RAM - I have to look). I just want tools I
| can use. The only computer/OS I was evangelical about was mh
| Amiga 1000 and 500!
| fennecfoxen wrote:
| > How is Cornell Tech's campus doing at Roosevelt Island,
| NYC?
|
| I dunno, but every time I head over to that end of the
| island it seems pretty dead. There is the Graduate Hotel
| with the swanky Panorama Room bar on top that's fun to
| visit (watch seaplanes land every half hour some days), the
| fancy cafe is open, there's nice open plazas between
| buildings, it connects to the park overlooking the river
| (and FDR memorial beyond) ... but it's all so empty. I
| can't imagine it's operating at normal capacity.
|
| North end is better anyway ;)
| daxfohl wrote:
| I think Microsoft and Amazon have the most interesting
| products as far as dev tooling. Unless you're really into
| ML I guess. Too bad they don't pay as well.
| 2OEH8eoCRo0 wrote:
| I call the big 4 antitrust cartel the FAAG (Facebook, Apple,
| Amazon, Google) because I'm childish.
| asiachick wrote:
| They call it GAFA on Japanese news
|
| https://www.youtube.com/watch?v=gU6QVlPq4gA
| serverholic wrote:
| I've made a similar joke that the N in FAANG really holds the
| whole thing together.
| vore wrote:
| Don't throw around slurs like that.
| 2OEH8eoCRo0 wrote:
| Don't tell me what to do. I try to assume good intentions.
| The word you're referring to has multiple meanings.
| vore wrote:
| This is the least good intentioned response you could
| have made.
| detaro wrote:
| Because FAANG was a stock market term for "hot tech stocks",
| and Microsoft was old and not-hot at the time.
| redisman wrote:
| It also meant highest paying companies at one point in the
| engineer market which is also why it got popular. MS isn't at
| the top on that metric
| [deleted]
| swebs wrote:
| Also MS has a reputation of being a horrible place to work
| for:
|
| https://blog.zorinaq.com/i-contribute-to-the-windows-
| kernel-...
| jstx1 wrote:
| You can find these anecdotes for every one of these
| companies. My perception is that Amazon has the worst
| reputation but I haven't done any market research or
| worked at any of them.
| swebs wrote:
| Yes, but bad in different ways. Amazon's reputation is
| that they overwork you and people only stay until their
| "golden handcuffs" vest. But their code quality and
| tooling is seen as excellent.
| dboreham wrote:
| Jim Cramer invents these acronyms
| afterburner wrote:
| I like MANAMANA (doo doooo, doodoo doo!)
|
| Microsoft, Apple, Netflix, Alphabet, Meta, Amazon, Nvidia,
| Adobe
| julienfr112 wrote:
| Adobe ? Why not Borland ?
| ksec wrote:
| I don't know about Netflix, but I definitely agree Nvidia
| should be in, coming at 800B market cap.
| mixedCase wrote:
| Nvidia isn't as software-focused as the others. Adobe is
| popularly known to be a software shitshow internally, whether
| that's true or not although by the stability and age of their
| products I'm inclined to believe they are.
|
| Maybe I'm misguided, but what I believe made FAANG a thing is
| a strong software-focused culture that maintained a level of
| quality and innovation that usually gets lost at that scale,
| as was the case with Microsoft and things like IBM.
| didibus wrote:
| Adobe's stock did grow 200% during the Pandemic.
| webwielder2 wrote:
| Everyone's stock did that during the pandemic.
| didibus wrote:
| Any other relatively well established tech company that's
| not in MANAMA ?
| jakswa wrote:
| I don't include microsoft so I can say they're "working for the
| MAAAN."
| BbzzbB wrote:
| I similarly don't understand why Netflix is included. Well, I
| do, but I don't understand why "we" didn't change Cramer's
| acronym to FAAMG long ago, IMO Netflix does not belong with
| these names neither in it's size, it's role in tech or it's
| cash flow. Arguably Nvidia would be a more fitting N, but it's
| cash flow is not in the same league either.
| dasyatidprime wrote:
| Thus 'GAFAM', though I've more commonly seen that one in the
| francophone world.
| BbzzbB wrote:
| I'm from Quebec and GAFAM is the usual media term for the
| big tech companies here. Amusing how the acronym got (IMO
| appropriately) corrected in translation, tho I'm not sure
| if it's just an artifact of it sounding cool (whereas GAFAN
| would be read out "gafa")
| it_does_follow wrote:
| > to FAAMG long ago
|
| Because Netflix pays Senior Engineers ~$500k/year in cash and
| MS pays Principal Engineers $300k TC?
| gopher_space wrote:
| I'd love to read an article from an ex-Netflix engineer
| explaining why their service is such garbage. I want money,
| but the reason I'd think about asking for that much is
| because I'd need to interface with massive irritations.
| CoastalCoder wrote:
| Could you elaborate on what you mean by "such garbage"?
|
| E.g., I stopped using Netflix for several reasons:
| uninteresting content, obnoxious UI, and
| unhelpful/implausible recommendations system.
|
| But I was always very happy with the reliability and
| performance of their streaming system.
| ajkjk wrote:
| It's not garbage? What are you talking about.
| exdsq wrote:
| What cheapskates Microsoft are!
| finolex1 wrote:
| The acronym has nothing to do with average developer
| salaries, for there are lots of other contenders that pay
| more.
| anamexis wrote:
| Developer salaries is the only context I've ever
| understood it with.
| clpm4j wrote:
| Originally it was about the companies' high performing
| stocks. The salaries are a downstream effect, and then it
| just got adopted by the salary-optimizing crowd of
| engineers and college students.
| mgraczyk wrote:
| My understanding is that this acronym is partially based on
| the perceptions employees have about the compensation and
| perks given out by big tech companies. Historically,
| Microsoft didn't pay as well.
| cactus2093 wrote:
| Apple and Amazon generally haven't paid as high as FB,
| Google, and Netflix in total comp either though. Of course
| in hindsight the stock gains in the past 5 years if you
| worked at either company have still made you
| extraordinarily well paid, and same with Microsoft.
| WalterBright wrote:
| > Historically, Microsoft didn't pay as well.
|
| Microsoft minted millionaires of its employees like
| popcorn. In the 90s the newspaper estimated that 10,000
| Microsoft millionaires lived in the area.
| poulsbohemian wrote:
| Tangential thought here: Today it's fashionable to say
| that the reason for Seattle area housing costs is
| "Amazon," so why wasn't it the same thing in the 90s with
| Microsoft? My guess is that it's a difference of scale:
| that back then there was still room to build on the
| eastside, and now it's not just Microsoft yielding high
| incomes and wealth, but also Amazon, Google, Facebook,
| and others. Still, interesting to ponder the real role of
| these companies in housing costs (since that's the knee-
| jerk assumption)
| taeric wrote:
| My guess would be location. Amazon is one of the only
| companies to locate in the city. Not near it, in it.
|
| Such that the "campus" of other companies is a discrete
| thing.
|
| How this fits for housing is that many new hires to
| Amazon don't have cars, and choose to live close to where
| they don't need them. Not really an option for the campus
| centric companies, where folks live further out and
| commute.
| WalterBright wrote:
| Seattle commutes are pretty miserable. Always have been.
| The problem is the metropolitan area rings a huge lake,
| so a grid arrangement of roads is impossible.
|
| The current problem is Sound Transit does not recognize
| that the metropolitan area rings Lake Washington, and the
| sensible thing is to build mass transit around that ring.
| I don't think the ST people have ever looked at a map.
| Even worse, the old rail corridors that ringed the lake
| were deliberately destroyed.
| taeric wrote:
| I mean. You aren't wrong. But Atlanta commutes were
| easily as bad back when I lived there.
| WalterBright wrote:
| Housing prices in the eastside were definitely blamed on
| Microsoft.
|
| Before Microsoft, for example, Kirkland was where you
| bought a house if you didn't have much money. Microsoft
| built their campus next door, and that was the end of
| cheap Kirkland real estate.
|
| Housing prices were closely related to commuting distance
| from the campus.
| daxfohl wrote:
| Amazon isn't known for Silicon Valley comp levels either.
| WalterBright wrote:
| Washington Amazon employees don't have to pay the heavy
| SV taxes, either.
|
| At least until lately. Washington is working overtime to
| raise taxes to California levels.
| zuhayeer wrote:
| They're catching up with their new pay bands, SDE II is
| starting to get offers in 350k - 400k range. Can even go
| higher by Q1 next year.
| User23 wrote:
| Their "philosophy of total compensation" used to actually
| penalize you for past RSU grants appreciating beyond
| projection. Even with a strong review you'd hear things
| like you can't get a salary bump, because you're already
| over your target compensation. I wonder if that's still
| the case.
| CoastalCoder wrote:
| Over time I've learned to tune out the reasons that
| employers use to justify changes to total comp. I just
| don't see why their reasoning would matter to me.
|
| I find it more useful to make my own assessments about
| what I could make elsewhere, and whether or not (all
| things considered) I want to continue with my current
| employer.
| BbzzbB wrote:
| I hear that thrown around, but while it may be accurate, it
| sounds like retconning as Jim Cramer came up with the term,
| and I can assure you Jim Cramer does not give a damn about
| developer salaries. It was about fast growing tech stocks,
| not software engineers.
|
| Even that goofball is now calling for FAAMG[0] (well,
| MAMAA) while (some) devs want to cling on to FAANG. Bit
| funny how Facebook's name change was apparently the trigger
| for him.
|
| [0] https://www.cnbc.com/2021/10/29/cramer-new-acronym-to-
| replac...
| 13of40 wrote:
| Up until the end of the 90s, Microsoft stock was booming
| enough that it was reasonable for them to compensate
| employees with less salary and more stock options. They
| survived the .com crash, but the stock basically flatlined
| for several years, making options not desirable as
| compensation. At some point, I think in the mid to late
| 2000s, they switched to higher salaries and actual stock
| grants instead of options. So there were a few years where
| it was paying less than other companies, but they corrected
| for it.
| bradleyjg wrote:
| On the other hand Netflix always had a much smaller rate of
| hiring than the others. If it was just about high pay
| Renaissance Technologies could have been included. It is
| best understood as high pay and large numbers of hires. In
| that view Netflix looks like a mistaken inclusion.
| random314 wrote:
| Jim Cramer coined the term to identify hot stocks. The
| term was coopted by big tech employees.
| randomdata wrote:
| _> MANAMA_
|
| Doo doo do do do.
| afterburner wrote:
| Just add Nvidia, Adobe
| coolspot wrote:
| This one - https://youtu.be/44NQkFJaEuE
| cromka wrote:
| > Doo doo do do do.
|
| MANAMA
| pkdpic wrote:
| Totally agree on the Microsoft point, although another poster
| pointed out that from an investment perspective faang may have
| referred to high roi companies so maybe microsoft was too well
| established? Not my are of expertise.
|
| In any case Im going to throw NAMMA out there too because I can
| say it easier and it leaves room for infinite M companies :)
| Cyph0n wrote:
| Manama is the capital of Bahrain :)
|
| I prefer MANAAM, which is derived from the word "sleep" in
| Arabic.
| robbedpeter wrote:
| Microsoft, Apple, Netflix, Alphabet, Meta, Amazon, North
| America:
|
| https://youtu.be/8N_tupPBtWQ
| theonemind wrote:
| In the big picture, on a very long time horizon, they seemed on
| a trajectory of irrelevance through the Ballmer era, up until
| Satya became CEO. (That doesn't even necessarily preclude
| record profits under Ballmer, but a hide-bound inability to
| adapt to changing market fundamentals.)
|
| PG tried calling it in 2007:
| http://www.paulgraham.com/microsoft.html
|
| They really changed when Satya Nadella came in, however.
|
| (Not to romanticize. Big tech has a smarmy evil these days.
| Ballmer just wanted to sell Windows and Office like products to
| big enterprises. It was less disturbing than donning their sith
| robes and joining the rest of big tech in trying to posses our
| incorporeal souls through massive amounts of data and
| 'nudges'.)
| nolok wrote:
| Which is unfair and short sighted, given that Ballmer is the
| guy who turned it from the windows shop to a company where
| windows is just one of 3 growing massive sections (plus a few
| smaller ones), with windows not even being the first one
| anymore.
| rootusrootus wrote:
| IIRC, Ballmer actually started many of the things that we
| saw happening early in Satya's tenure. So he deserves at
| least some credit for seeing the writing on the wall and
| trying to adapt to it. Perhaps he also figured that in
| order for the transformation to really happen he had to not
| be the one trying to lead it.
| devoutsalsa wrote:
| Ballmer also took charge right after the dotcom bust.
| Even though the stock tanked from ludicrous highs,
| revenue steadily grew under his tenure. I can't speak to
| how company longevity performed under his reign.
| WalterBright wrote:
| I know Steve. He's been unfairly maligned for a long
| time. The biography of him is pretty mean. I doubt the
| author ever even met him.
| [deleted]
| ChuckNorris89 wrote:
| _> Ballmer just wanted to sell Windows and Office like
| products to big enterprises._
|
| Yes, but actually, _NO_. I know it 's fashionable to bash
| Ballmer for being the stereotypical image of the late '90's
| corporate villain, pulled right out of Office Space[1], but
| he was also the one who got the ball rolling on what we today
| know as Azure and saved the Xbox division during the red ring
| of death and other major issues that plagued the Xbox 360 and
| cost Microsoft billions.
|
| If he only cared about the enterprise stuff, he would have
| sold the Xbox division or let it sink at the first sign of
| losses, but instead he propped it up despite the massive
| losses. IMHO, he should get some kudos for that as Xbox is
| currently the only competitor to the Play Station (Nintendo
| isn't since they do their own thing).
|
| _" I am trembling, sat in front of Steve (Ballmer), who I
| love to death, but he can be an intimidating human being. And
| Steve said, 'OK, talk me through this,'" Moore added. "I
| said, 'If we don't do this, this brand is dead.'" If we
| hadn't made that decision there and then, and instead tried
| to fudge over this problem, then the Xbox brand and Xbox One
| wouldn't exist today."_[2]
|
| Ballmer also set the stage for Microsoft's entry into the
| cloud space in the early days before it was even called
| Azure, when he saw what AWS was doing.
|
| _" Steve Ballmer, the former CEO of Microsoft, initially
| resisted the idea of embracing the software services paradigm
| fearing that it would cannibalize Windows and Office business
| which was contributing to 80% of the revenue. Eventually,
| Ballmer was not only convinced but pushed Microsoft to become
| a fully-fledged cloud company through "we're-all-in" war
| cry."_[3]
|
| Not saying you should like him or anything, but this guys
| really deserves more credit that he gets for where Microsoft
| is today (the good and the bad).
|
| As a bonus, for added humor, here he is going crazy on stage
| about _' DEVELOPERS'_, like a hamster on cocaine. [4].
|
| [1] https://www.imdb.com/title/tt0151804/
|
| [2] https://www.vg247.com/rrod-xbox-360-ballmer-xbox-one
|
| [3] https://www.forbes.com/sites/janakirammsv/2020/02/03/a-lo
| ok-...
|
| [4] https://youtu.be/I14b-C67EXY?t=12
| michaelcampbell wrote:
| > As a bonus, for added humor, here he is going crazy on
| stage about 'DEVELOPERS',
|
| I guess some people found it funny, but everyone I work
| around as a software developer (not for native Windows/MS,
| mind) all found it incredibly embarrassing.
| [deleted]
| itronitron wrote:
| >> trying to posses our incorporeal souls...
|
| I think this is driven by an addiction of big tech to being
| 'relevant' and engagement is the metric that gives them that
| sweet hit of relevancy. Heaven forbid they just turn out a
| useful product for a reasonable profit.
| dhosek wrote:
| MANAMA? do doo di do do
| hinkley wrote:
| The new challengers need to name themselves all D and O names.
|
| Do doo do doo
| ultrasounder wrote:
| FAANGMULATAD-FacebookAppleAmazonNetflixGoogleMicrosoftUberLyftAir
| BnBTwitterAlphabetDropbox Attribution- Blind
| gibbonsrcool wrote:
| Square Salesforce Shopify Stripe SpaceX Netflix Alphabet Apple
| Amazon AirBnb Krispy-Kreme Equinix Zoom "SSSSSnaaaakez"
| prog5 wrote:
| dang why u gotta throw krispy kreme under the bus like that!
| mro_name wrote:
| nice, that my lightning talk at 35c3 (2018) turned out so
| effective:
| https://media.ccc.de/v/35c3-9566-lightning_talks_day_2#t=333...
| DeathArrow wrote:
| Time to short FAANG and TSLA. :)
| cblconfederate wrote:
| Maybe that s why Elon, Nadella, Bezos are selling lately
| mattferderer wrote:
| Might also have something to do with taxes.
|
| Washington state is increasing capital gains tax next year. +7%
| I believe.
|
| Elon had options expiring soon & was forced to.
|
| Might be other reasons but those should not be overlooked.
| adventured wrote:
| AAPL $2.65t, MSFT $2.47t, GOOGL $1.89t, AMZN $1.72t, TSLA $1t, FB
| $853b, NVDA $764b
|
| Right now that's reasonably big tech in terms of publicly traded
| US tech companies. Everybody else is a long ways down.
|
| So.
|
| BRK $621b, JPM $476b, JNJ $419b, PG $362b, DIS $265b, KO $231b,
| VZ $215b, MCD $186b, BA $116, CAT $107b, MMM $100b
|
| All of those companies combined will fit inside Apple's valuation
| at the rate things are going. And just about every old-line blue
| chip with a consequential market cap is somewhere between
| pathetically slow growth and stagnant. Meanwhile big tech is
| still expanding. And you can replace any number of those
| companies with others, whether HD, or AT&T (T) or WMT or LOW or
| PEP or TGT, with much the same outcome.
|
| This article is, you guessed it, laughably, embarrassingly,
| false.
|
| Big tech will keep getting bigger in relation to most of the
| other quasi rotting blue chips.
|
| There is nothing coming up that will prompt a massive expansion
| of the old blue chips such that they're going to retake ground
| against big tech (not unless one believes all of big tech will be
| smashed to pieces by anti-trust - never gonna happen). The China
| boom is largely over, which means these old blue chips can't look
| forward to sucking off of that market any longer and there is no
| next China (nothing remotely comparable to that extreme of a
| boom). Are railroads and airlines going to start suddenly growing
| at 50% per year? Of course not. Productivity is about to
| skyrocket? Of course not. The US is going to suddenly take over
| the world's steel production? GM and Ford are going to put all of
| Germany and Japan's automakers out of business and every human on
| the planet is going to buy an extra vehicle? For no apparent
| reason companies like 3M are going to start growing rapidly?
| Pepsi and Coke are going to sell 2x the sugar water in an era
| that is turning against their core products (check out how
| pathetic Coke's business has been over the last 5-10 years)? How
| about big pharma, PFE's ass got saved by Covid, at least
| temporarily, as the vaccine threw them a bone. McDonald's, after
| so many years of stagnation (and given their saturation), is
| suddenly going to become a nice place to eat and start selling 2x
| the fries and burgers? Of course not. Americans are going to
| start buying a lot more Kraft box pasta or Heinz ketchup or
| Oreo's from Mondelez or soup from Campbell's? Of course not, it's
| all slow growth garbage. Campbell's is on a rocket ship to
| becoming a juggernaut $300 billion soup empire! Yeah, bullshit.
| And so on it goes.
|
| For most of these companies, if they're lucky, they'll have just
| enough pricing power to keep up with dollar debasement and not
| lose real ground over this decade. More likely some of these
| garbage companies like MCD or KO will lose 1/4 or more of their
| real business to USD erosion as their customers can't (and won't)
| pay $5 for a 20oz soda or $6 for fries. These companies have
| struggled for many years to gain ground in real-terms prior to
| the recent wave of inflation, it's only going to get more
| difficult for them (consumers will be trapped in hell between
| higher prices and eroding real household purchasing power, and
| that's all assuming household debt doesn't get more expensive
| (it's historically cheap)).
|
| If anything, the old blue chips will rot further and big tech
| will gain even more ground, over the next 3-5 years. Even if this
| market declines, relatively speaking big tech is still likely to
| take ground over time against the rest of the market.
| FredPret wrote:
| You make some good points.
|
| However, note that there is a very long way to go for
| traditional industries.
|
| China is one big chunk of people, and they may be in for a
| rough couple of decades with their recent return to hardcore
| communism, but there is a lot of room to grow there still. And
| there is India and all of Africa.
|
| Untold numbers of people in the third world are rapidly
| approaching middle-class status, buying fridges and cars and so
| on.
|
| This will have the concomitant effects on the rest of the
| economic ecosystem, and tech will ultimately gain even more
| from more rich consumers. But it's not game over for the big
| old juggernauts.
| adventured wrote:
| If any of that were true, we'd have seen it in the old-line
| industries sales growth during the last five years. That
| hasn't been the case at all (and wasn't prior to Covid
| either). Global growth is not going to accelerate in some
| great way this decade, it's going to be mediocre as China
| struggles mightily with growth and debt, among other serious
| problems. Japan, Germany, Britain, France will all remain
| stagnant (as they have for most of the past decade plus net).
| Other Asia will produce growth, but there's no guarantee US
| industrials will have great access to that growth; if those
| countries (eg Vietnam, Indonesia, India, etc) are smart,
| they'll pull a China and favor their own domestic context as
| they grow (which India already does quite a bit of for its
| part).
|
| > Untold numbers of people in the third world are rapidly
| approaching middle-class status, buying fridges and cars and
| so on
|
| Not made in America fridges or cars. Those fridges won't
| likely be made by US companies in Asia, either. Not cars made
| by GM or Ford (trucks actually, as they hardly make cars
| these days). And those relatively poor global median
| consumers can't afford Teslas (now or in 20 years). And those
| emerging consumers aren't buying $45,000 US trucks either.
| The best case scenario for old US industry is to tread water,
| to not lose ground while sparring with China and all the
| other emerging market companies.
|
| Most of the major emerging markets are going to come up ready
| to fight with their own champions, as China has (although not
| as potently as they've done it). The US old-line companies
| are at risk of getting their collective head punched in as a
| lot of new companies come up out of emerging markets looking
| to dethrone them. Mid-tier manufacturing will plausibly see a
| huge threat from emerging market companies pushing up the
| value chain, while high-tier manufacturing is absolutely
| going to take a direct assault from China (Boeing, Deere,
| autos, semiconductors, et al.).
|
| As it pertains to the US, the only type of company I'd be
| interested in being over the next decade, is a tech company
| with (ideally) global use potential. Everything else is
| largely going to suck big time, either due to pricing power
| problems with USD erosion domestically (constant battle
| there), or intense competition problems overseas (and or
| market access problems in locations like China). An extra
| aside: along with particularly not wanting to be Boeing this
| decade, I wouldn't want to be Starbucks (just wait until you
| see what China does to them).
| b9a2cab5 wrote:
| The most potent competitor to Starbucks (Luckin' Coffee)
| took a huge hit due to accounting scandals just recently.
| More generally Starbucks in China is considered a luxury
| brand (not what it is in the US).
|
| Anything manufacturing related I can see being shifted
| overseas. US labor is too costly compared to international
| labor. I think Deere and co already see the writing on the
| wall and are moving to diversify with autonomous
| capabilities. Software is not so easy to copy or we
| would've seen an iOS clone out of China that actually works
| as well as iOS.
| lotsofpulp wrote:
| > BRK $621b
|
| BRK should not be included in these lists because it is just
| double counting AAPL, BA, and a few other blue chip companies.
| It is 40%+ AAPL.
|
| https://hedgefollow.com/funds/Berkshire+Hathaway
|
| I agree with your conclusions though.
| pg314 wrote:
| AAPL is 40%+ of BRK's _investment portfolio_. There is a
| substantial number of wholly owned subsidiaries. AAPL
| constitutes only about 25% of BRK 's market cap.
| lotsofpulp wrote:
| Ah, thanks for the correction.
| seanmcdirmid wrote:
| USD erosion and buying power erosion are two different things.
| If salaries go up almost as much, they'll still be able to buy
| the soda and fries. If not, McDs might even do better, because
| no one will be able to afford $10 soda and $25 fries at a
| better restaurant, and will settle for McDonald's instead.
| gopher_space wrote:
| In my city the locally owned burger places have been paying
| decent salaries for decades and the people working there seem
| to not hate the job. The prices are just about McDonalds
| level and the quality is much better.
|
| Prices are going up at places that see labor as part of their
| Just In Time system, which turned out to be amazingly fragile
| in a number of areas.
| adventured wrote:
| That never happens. You're talking about a fantasy scenario
| that only exists in a formula on a piece of paper, not in
| reality. Salaries will not step match USD erosion, incomes
| will get mauled as they tend to historically when confronted
| with inflation, and it'll cause increasing social chaos as
| the real standard of living drops (out of desperation for
| bargaining power, unions are likely to get more interest as a
| consequence).
| agumonkey wrote:
| Numbers are one thing but it seems that these brands are
| growing under now. It's not the original product/brand but
| infrastructure, research, future unrelated projects.
| sofard wrote:
| I don't know if "% of total returns" is a fair metric. As a
| percentage of market cap, they still dominate the S&P500. Not to
| mention every asset manager has to own them otherwise they risk
| looking stupid. They're today's bluechip, for better or for
| worse.
| chris_wot wrote:
| It's a MAANG market now, I guess. Can't wait for it to be the
| AANG market. Or perhaps the NAGA or NAAG market. Perhaps the GAAN
| market might be inappropriate.
| dryst wrote:
| You seriously just going roll right past MANGA like that?
| Incerto wrote:
| Shouldn't we be calling it MANGA now?
| red_trumpet wrote:
| If you change Facebook to Meta, you also should change Google
| to Alphabet, right?
| endisneigh wrote:
| Google did not change its name to Alphabet, nor has the
| ticker changed. Don't know why people keep saying this.
| nostrademons wrote:
| Sort of. GOOG(L) the ticker now represents Alphabet - when
| you buy GOOG, you are also getting shares of Waymo, Verily,
| Calico, and the rest of the "Other Bets". In that sense,
| Google did change its name to Alphabet. OTOH, Google as a
| separate company still exists within the Alphabet umbrella,
| and Google employees remain employees of Google (though
| they get Alphabet stock compensation). Also Waymo employees
| do _not_ get GOOG stock (they get Waymo stock, which is
| currently privately held and majority-owned by Alphabet),
| so there is a real distinction between them.
| outsomnia wrote:
| MAAAN...
| jstx1 wrote:
| Saying that they're fading because they grew more last year is
| oversimplifiing things just to get a headline.
| wepple wrote:
| Exactly, it's an absurd headline. Their influence over growth
| has gone back to more-or-less normal. This article says very
| little of value.
| ferdowsi wrote:
| It's beyond time to retire the FAANG acronym. At one point it
| signaled a group of companies that were dynamic players that were
| (to various extents) disrupting the existing business landscape.
| Now these companies are incumbent behemoths asking to be taken
| down in the same manner.
| ralusek wrote:
| So long as the acronym has utility for identifying something in
| a more concise way than the alternatives, people are probably
| going to keep using it. Incumbent behemoths still need names.
| thuccess129 wrote:
| > It's beyond time to retire the FAANG acronym.
|
| Antartica has a place called Wolfang. Lots of solar energy 24
| hours for months half the year. Minus fifteen degrees
| centigrade temperature for the data center stadiums. Near zero
| cost real estate property prices. Uplink to satellite mega
| constellations. Two thirds of humanity isn't served as
| futuristically as Silicon Valley and they don't have a $50K
| Boxable for their inside. WOLFANG global services oriented
| market has yet to shine?
| [deleted]
| alexpetralia wrote:
| Is that from where the acronym emerged? I thought it was really
| an investing term, which described tech stocks with tremendous
| returns. I did not think "dynamism" was part of it.
| hammock wrote:
| Remember when the BRICs were a trendy acronym? Obviously the
| individual parts have some relevance but not sure if the BRIC
| entity as a whole ever really meant as much as it was promised.
| ghaff wrote:
| BRIC was basically up and coming geos. (Obviously an
| oversimplification.) China became something much different
| (ADDED: and more complicated) from the other three. And the
| other three arguably didn't grow as much in relative economic
| importance as the acronym implied they would.
| hammock wrote:
| Exactly. Didn't turn out as promised.
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