article in The Standard (February 5, 2001) profiled the cut backs at Amazon.com. Amazon will
be profitable by the 4th quarter but is now being criticized
for no longer being a growth oriented company. It seems Amazon will
enjoy a dismal 20 to 30 percent growth this year and this
is no longer interesting to a jaded market. It is being called the end
of the e-retail revolution - or at least Amazons leadership of
will reach 3.4 to 3.6 billion this year - this from scratch a few years
back. Was a time when an accomplishment like this would have been applauded.
Five years ago the question on the street was if people would really buy on line. Seems like a revolution to me.
over 50 years of watching the US economy, this is the first time I have
seen people offended because they discovered that getting rich with
out thinking or effort is not a sacred right.
DOT whatever is a tale of HYPE and ANTI-HYPE. It became
a gold rush with no purpose or dignity and now is a whimper with the
analysts presiding over the Freudian couches. You cant have it
both ways from Sunday but many are still trying.
of this, of course, stems from the totally false assumption that the
purpose of business is to make money. In particular, to make money for
absentee landlords of passive capital. Until this UpSideDown premise is righted, market dynamics will continue to wildly swing the
foolish between godlike arrogance and them despairing the end of the
about this idea? Business is about creating, marketing and servicing GOODS. Goods as in good-for-you. These goods are provided by
people who are passionate about what they do. Passionate, not
impassioned about seeing how rich they can get in three years. They
build their organizations to be ValueWeb enterprises which serve, equally, the investor, user (customer/buyer)
and producer. These are stable enterprises managed as a commons should
be - not as egocentric expressions of who is on top this week. They
create WEALTH. They do not destroy people or the environment
in the process of doing so - people are happy, Gaia is happy, LIFE is the dominate principle. Those that make the
truly great hacks get recognition and a fair share of the earnings.
Everyone is respected.
crazy? It is what is going on today that is crazy. If a single individual
acted the way our economy does (us collectively) they would
be judged clinically insane by the standards of modern psychiatry. If
we saw animals doing the equivalent imagine what we would say. We would
call it brutish, dumb, tooth and claw, lemming-like and bent on self-destruction.
off, someone comes up with some neat ideas which almost everyone ignores
or declares not useful. Then, there is a breakthrough of some sort and
the utility of the new thing is demonstrated. One of the gatekeepers
who controls access to the financial citadel expresses interest. Then,
all common sense is thrown to the wind. 10,000 years of human history
is ignored. The keepers of the system find out they can make tons of
bucks by lending their name to any jackass idea that comes along. Things
really get manic. A giant positive feedback loop roars into motion.
IPO after IPO each more outrageous than the last. Basic businesses cannot
compete for capital because it is so easy to get rich in the new economy.
Hype on hype as fortunes are made overnight. The new Gurus
are godlike as everyone sits at their feet believing their every utterance
about anything and everything. People who just go out and make useful
things for a decent profit are ignored. On it goes until one day this
manic-depressive trip comes crashing down on the rocks of reality. The
very same people who cheered on the excess now become wolves. Budgets
are slashed, people are laid off, and an entire economy goes into chaos.
Some get out with a lot a cash. Many are left holding the bag of their
delusions. Already, the hunt is on for the next BIG thing...
with real potential get junked along with the trash. Management Teams
struggle to redefine their strategy and read the tea leaves of the disappointed
market analysts. A few people in each sector, who do not invent, create
nothing, have nothing at stake and are beholding to no one exercising
enormous power - the power to take 30% from a companies value
in one day. A value they were in large part responsible for making in
the first place. Both values cannot be right - not from
one day to the next, even a quarter apart.
there is a name for this behavior. Fortunately, it couldnt happen
here - not to us, surly. No harm done, I guess, as long as we see it
as a game on the level of Monday Night Football. However, if we believe
in it... Anyway, it is just the peasants who lose their job, what do
they count? The smart money gets out. Naturally. The market just churned
one more time pouring billions into a few hands while opening the doors
to some new comers who get to join the ranks of the financial elite.
Where is the economy for the rest of us?
Is this what you want your
life to be about?
get me wrong, by the way, I totally believe in free enterprise. Regulation
is not an answer. I just point out there are choices in how we use this tool. I also point out
that when the keepers of the system get in the game this is not only
a breach of fiduciary duty it quickly destabilizes the system itself
to an inevitable result. You might ask yourself just how free is this economy. Ever try to do an IPO on your own?
something like the recent dot bubble burst happens look closely at who benefits.