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The Tech Sector Is Leaving the Rest of the US Economy In Its Dust (theverge.com)
Yesterday afternoon, the S&P 500 closed at a record high, and is up over $1.5 trillion since the start of 2017. "And the companies doing the most to drive that rally are all tech firms," reports The Verge. "Apple, Alphabet, Facebook, Amazon, and Microsoft make up a whopping 37 percent of the total gains." From the report: All of these companies saw their share prices touch record highs in recent months. This is in stark contrast to the rest of the U.S. economy, which grew at a rate of less than 1 percent during the first three months of this year. That divide is the culmination of a long-term trend, according to a recent report featured in The Wall Street Journal: "In digital industries -- technology, communications, media, software, finance and professional services -- productivity grew 2.7% annually over the past 15 years...The slowdown is concentrated in physical industries -- health care, transportation, education, manufacturing, retail -- where productivity grew a mere 0.7% annually over the same period." There is no industry where these players aren't competing. Music, movies, shipping, delivery, transportation, energy -- the list goes on and on. As these companies continue to scale, the network effects bolstering their business are strengthening. Facebook and Google accounted for over three-quarters of the growth in the digital advertising industry in 2016, leaving the rest to be divided among small fry like Twitter, Snapchat, and the entire American media industry. Meanwhile Apple and Alphabet have achieved a virtual duopoly on mobile operating systems, with only a tiny sliver of consumers choosing an alternative for their smartphones and tablets.
Those types of jobs are in fact coming back, for good reasons - Apple wants somewhere closer to home to make more things so they can contribute leaks.
Apple may be at the forefront but MOST manufacturing is going to go local in the next decade or so.
How can it come back? Greatly increased use of automation means you don't have to hire nearly so many expensive U.S. workers, so automation actually makes more locally sourced manufacture more desirable again.
There will not be as many jobs, sure, but they will be there and they will be better than what came before.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
The reason those stocks are increasing is that millions of people have their 401K investing in "tech stocks" The people who manage some of those get a billion a week that they are obligated to invest before the next billion shows up next week. The result is the tech stocks are over valued and the price keeps going up as the game continues.
This gets worse when they go to prove their investment works. Say they bought a billion in shares in GOOG 5 years ago at $300. They can sell them this week for $950 or so they make a 2.16 billion profit which they can keep for weeks since it was a result of a sale of stock. Next week they dump another billion into GOOG stock at say $1000 and they other 3.16 billion from last weeks sale may go to something else like IBM and MSFT just after the investment firm reports wonderful profits.
There is a class of investment in the UK that is limited to something like 60 tech companies and there are retirement funds that are limited to those 60.
The high speed computer traders know this and have been gaming the system for decades.
I wouldn't be so keen to see these jobs coming back. If unskilled jobs come back, it only means that the income situation is completely FUBAR in the US, because it means that wages in the US can compete with wages in a Chinese sweatshop.
And you don't believe that working conditions in the US would be any better than in a Chinese sweatshop if you can compete with it on salaries.
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
And until the not so recent past, that was a pretty sensible attitude. New was better, and free was actually free. Yes, TANSTAAFL does apply, but I do remember people who would host parties for the only reason that they enjoyed being party hosts and invite friends over. Without any actual ulterior motifs.
And new did actually mean better. Think back the last 100 years and you'll see that every generation of something that came out was in some way better than its predecessor. Faster. More reliable. Safer. More convenient.
Only recently this has changed dramatically. Newer technology isn't really better than its predecessor. Actually, again and again we had to learn that newer generations of something took things away from us. Cars get harder and harder to repair yourself with every generation having more and more technical bullshit baked into its vital parts (I'm not talking about passenger entertainment, I'm talking about operation). Phones are actually losing features instead of gaining some (with the headphone jack only being the tip of the ice berg).
And you don't want me to compare Windows 10 to ANY of its predecessors, including ME...
We used to have a Bill of Rights. Now, with the rights gone, all we have left is the bill.
Wages have been stagnant for almost 10 years even for the A players and unicorns.
There are slightly higher paying jobs (5-10%) you could take but they require twice as much work if not more. Not worth it especially if you have a family. We're still due for a correction because of the recession like everyone else.
We'll make great pets