No, the point is that $50 million and $1 billion are the same for most practical purposes. Aiming for one rather than the other isn't going to meaningfully change how you act; in this context, both are just absurdly big numbers.
The number you're aiming for is going to meaningfully change how you act. For example, you might get an offer for $50 million. If you do, the probability of making it to $1 billion matters. (Incidentally, the creator of this community was faced with almost exactly this choice.)
It may be true that the number of $1 billion exits per year is only, say, 10 times fewer than the number of $50 million exits. It's an empirical question. The numbers matter.
Let's just raise the $1 billion number until it's a better bet to go for $50 million. At some point the argument that "both are just absurdly big numbers" breaks down.
Perhaps the reason people think that the numbers don't matter is because they believe that the skills required to build a $50 million company is no different than those required to build a $1 billion (or $100 billion) company. That I buy.
The fact that the destination is the same does not mean that the journey doesn't matter. Most people are not indifferent to dying in 6 hours or in 60 years.
It's ridiculous to think about surviving the heat death of the universe when 50 % longer life spans would be pretty cool.
In the coming decades, We may or may not be able to significantly extend life, but it's not clear why it's unlikely, or why it causes harm to even think about.
The benefits of diversification -- higher return and lower risk -- is a better reason to invest in gold, even if it was true that gold holds its value for millenia, which probably isn't true.
The article is about "why stocks beat gold and bonds" not "why you should own only stocks and never own any gold or bonds".
It's Warren Buffett, man. Perhaps he invests (long-term) in stocks because he believes what he writes, rather than writes what he does because he just happens to be invested in stocks. You really think there should be a disclaimer here?
I don't think people do treat market share as a proxy for profit share. You don't really need a proxy for profit share because it's easy to measure. And if market share is publicly avilable information, so is probably profit share. It does make some sense to treat market share as a proxy for market power, though -- business people do this all the time.
An alternative interpretation of the article is simply that Apple is targeting a more profitable segment of the market -- smartphones.
It happens to be the case that this segment has grown really fast and have both the highest margins and the highest total profits. This is perhaps not the case in most industries, which may be interesting.
The remarkable thing about Apple of late is not that they target a profitable niche (which is a given with their product pricing), but how much they grow their niches. They did it the iPod, iPhone and iPad.
If Apple stopped selling these things tomorrow would other vendors capture the surplus? Or would people just go back to spending more money on other things?
Whether Apple exists or not, it doesn't seem like other vendors can raise their margins because they are in such a foot race. Apple has somehow risen above the fray through a combination of doing integrated hardware and software better than anybody and mastering the supply chain. Where HTC and Samsung are trying to one-up each other on screen size, Apple holds onto their margins selling a smaller screen for a higher price. This seems crazy until you actually use the latest Android phone and you're like "Why the F can't they get the screen to work half as good as an iPhone".
It's hard for you to be wrong. If someone with zero programming talent does become really good, you could just say that they did have talent after all.
Let's make a baseball analogy. Do you think a person with no hand-eye coordination can become a great hitter?
I have no doubt there are people who are math averse who have plenty of untapped math ability (e.g. most women with math ability have been taught to think they can't do math). There are plenty of psychological reasons why a person who is capable of doing something might think they have "zero talent", and it's perfectly plausible for a good mentor to help them unlock their ability. But that's a far cry from the argument that "anyone can be a great programmer".
I was wondering about the exact same thing. Ability and willingness to pay should mean ability and willingness to pay in real terms. Anything else doesn't seem to make sense.
Also: If the US defaults, how does it go down?
Here's why I'm confused:
Given that the US can't default on its nominal obligations, how does it default on its real obligations, so to speak? Printing money, aka inflation, is one way, but there's always inflation. Does that mean that the US is always defaulting to some degree? I'm thinking no, because lenders are compensated for higher inflation with higher interest rates. Would the US ever go "no, Chang, we're not going to give back your $10, sorry"?
Oh, I think I answered my own question. The lenders probably factor in inflation when they lend the US money. That would actually mean that the loans are in real money, and that there is no such thing as a nominal obligation.
I'm not sure I understand your question correctly. There is definitely such a thing as a nominal obligation.
When the treasury wants to borrow money, it conducts an auction to determine who gets to lend it how much at what interest rate. If, at the end of that auction, a particular lender agrees to lend the treasury USD 1bn for 10 years at a yield (interest rate) of 3%, you can calculate the exact nominal dollar amounts that are to be paid back. These amounts never change from then on come what may.
Every year the treasury has to make a USD 30 million coupon (interest) payment to the lender. After 10 years the treasury has to pay back the principal, that is the original 1bn amount. That's it.
If the average inflation rate in that 10 year time period is 2%, the lender's return on investment is 1% (10 million dollars). If the inflation rate turns out to average at 3%, the lender makes zero. If inflation is 5%, the lender makes a loss of 2% (20 million).
If the inflation rate is somewhat higher than the yield and the lender makes a loss, it is not formally a default. I'm not sure what happens in terms of formal default if a borrower deliberately and aggressively inlfates away its debt faster than lenders can react by demanding higher interest rates at the next auction.
I believe this has never happened in modern times because borrowers who would do that cannot usually borrow in their own currency. What would definitely happen is that this borrower would have to pay much higher interest rates as soon as he comes to the market again, so nobody wants that.
There is another type of treasury bonds called TIPS, which are inflation adjusted. They have a lower yield but are protected against rising inflation.
> I'm not sure what happens in terms of formal default if a borrower deliberately and aggressively inlfates away its debt faster than lenders can react by demanding higher interest rates at the next auction.
This is the reason why I asked my question(s). Why would the borrower ever aggressively inflate away its debt, as opposed to gradually inflating it away? If there is no definite point of default, the US is either defaulting frequently, or can never default.
I wonder what the definition of default is, and if it's an event or a process.
*>Why would the borrower ever aggressively inflate away its debt, as opposed to gradually inflating it away?
Because if it happens gradually it doesn't work as lenders would demand gradually higher interest rates every time a debt tranche is rolled over.
I have looked up the terms of credit default swaps and it turns out that inflating debt away does not constitute formal default in the CDS market. Formal default (a so called credit event) only results from missing a payment or restructuring the terms of payment.
Interesting point. If ideas, arguments, and claims in video and audio can be visualized more effectively, that might change things even more.