Because it is never enough. We see this time and time again. Once they are making billions, the people in charge will demand that they start making dozens of billions, and then hundreds. The growth must never cease, because the moment you stop growing, you can't sell the dream that supports ridiculous PE ratios anymore.
Google was a very profitable business 10 years ago and the search was still decent. In the last decade they absolutely butchered their core product (and the internet along with it) in an effort to squeeze more ad dollars out, because it's not the level of profitability that they need to maintain, but the growth of that profitability.
Microsoft was a ridiculously profitable company, but that is not enough, they must show growth. So they add increasingly user hostile features to their core product because the current crop of management needs to see geometric growth during their 5 year tenure. And then in 5 years, the next crop of goobers will need to show geometric growth as well to justify their bonuses.
Think about this for a moment: the entire ecosystem is built on the (entirely preposterous) premise that there must be constant geometric growth. Nobody needs to make a decision or even accept that this is long term sustainable, every participant just wants the system to keep doing this during their particular 5-10 year tenure.
It's an interesting showcase of essentially an evolutionary algorithm/swarm optimizer falling into a local optimum while a much better global optimum is out of reach because the real world is something like a Rastrigin function with copious amounts of noise with an unknowable but fat tailed distribution.
If you consider complex forms of life serving as an entropy-increasing phenomenon, then you might as well consider that the evolutionary algorithm is governed by such goals. It's even plausible to take the human behaviors like increasing consumerism and growth-orientation as being connected to this fundamental thermodynamic drive. Perhaps we'll find even more efficient principles to drive our consumption further. <extending on your rant obviously />
>It's an interesting showcase of essentially an evolutionary algorithm/swarm optimizer falling into a local optimum while a much better global optimum is out of reach because the real world is something like a Rastrigin function with copious amounts of noise with an unknowable but fat tailed distribution.
I've never heard it framed like this before, that's beautiful.
Just copy pasting the response to another commenter asking in similar vein:
Thank you for the kind words. I've been thinking of doing something long form, I'm just unsure if there's enough of an audience in this age of catchy tweets and tiktok videos.
Full disclosure, I had no formal education in writing... I suppose all credit goes to the actual great writers I take inspiration from.
Ha, thank you for the kind words. I've been thinking of doing something long form, I'm just unsure if there's enough of an audience in this age of catchy tweets and tiktok videos.
Full disclosure, I had no formal education in writing... I suppose all credit goes to the actual great writers I take inspiration from.
Google was a very profitable business 10 years ago and the search was still decent. In the last decade they absolutely butchered their core product (and the internet along with it) in an effort to squeeze more ad dollars out, because it's not the level of profitability that they need to maintain, but the growth of that profitability.
Microsoft was a ridiculously profitable company, but that is not enough, they must show growth. So they add increasingly user hostile features to their core product because the current crop of management needs to see geometric growth during their 5 year tenure. And then in 5 years, the next crop of goobers will need to show geometric growth as well to justify their bonuses.
Think about this for a moment: the entire ecosystem is built on the (entirely preposterous) premise that there must be constant geometric growth. Nobody needs to make a decision or even accept that this is long term sustainable, every participant just wants the system to keep doing this during their particular 5-10 year tenure.
It's an interesting showcase of essentially an evolutionary algorithm/swarm optimizer falling into a local optimum while a much better global optimum is out of reach because the real world is something like a Rastrigin function with copious amounts of noise with an unknowable but fat tailed distribution.
<rant/> by a hedge fund professional.