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Robert Scoble
I'm having a lot of trouble getting my mojo this week. The economy has me distracted to say the least. Cisco was cool, until people there started talking about the economy after the cameras were off. I've never seen this level of fear and uncertainty in the valley. Not even after 9/11.
I'm with you on that one, it is a bit distracting. - xero
Much needed wake up call. - Mona Nomura
Mona: it's far deeper than a wakeup call. I think it's really going to be pretty tough for many people. - Robert Scoble
I think everyone seeing their 401k drop like a rock hasn't helped. - xero
xero: that's just the first shock, I fear. My 401k is only an abstraction at this point in my life (20 years away from traditional retirement). - Robert Scoble
My email is just JAMMED with messages about the economy these days. - J. D. Ebberly
That's quite interesting. - imabonehead
It is, Robert. That's why we (as a nation) need to put aside our differences and put our heads together to come up with long term solutions, while considering short term ones. - Mona Nomura
Mona: long term solutions? Get America on top again in science and technology because that's where almost all future high paying jobs will be. Focus on tearing apart our educational system, which is totally not serving tech and science well, and rebuild it from scratch. Focus on updating our government to use technology and not paper anymore. Etc. Etc. - Robert Scoble
But that means getting rid of social conservatives who think abortion is the only issue that matters. It means electing leaders who know how to use a computer and who aren't religious focused, but are science, education, and technology focused. It means putting in broadband everywhere and wifi many places to encourage new web-focused businesses to flourish. It means keeping the cable and telecommunications industries regulated... - Robert Scoble
Mark: yup. That will be a shock. I'm not planning on it being around when I retire. - Robert Scoble
When I say "get rid of" social conservatives I mean that the Republican Party needs to kick them out. If they can do that and get back to true fiscal conservatism, like what @johnculberson wants to do, then that might be interesting to talk about. Luckily no one will be able to bring up anything except focus on the economy for the first six months of the next Presidency. - Robert Scoble
It means a lot of things, things this country needed for a long time. It means the public, start thinking about who we put in office and actually start voting. It means consumers financially educating themselves and not spend beyond their means. And it also means the things you stated above. I'm actually excited to see this country rise after this economical crumble. - Mona Nomura
I think a lot of that is the Valley. We talk about it a bit out here, but I don't sense the fear I'm seeing from the Valley on FriendFeed and the blogosphere. - Jesse Stay
Robert - to your original message - as per your recent blog post, here is my response (copy+paste): We are only in a “death spiral” as long as the media keep telling us we are. The mere reporting of “panic” helps CAUSE panic. Maybe you can use your power/influence to help remind us of the GOOD things going on, as the more we hear about companies creating revenue, opportunities, and jobs, the more confident we will all get. - Jeremy Toeman
+20 for @Jeremy Toeman - xero
"The madness of crowds is powerful -- don't get swept up because there's only one direction that the collective negative goes, and that's down." via http://adage.com/smallag... - Mona Nomura
Make it +40 for@Jeremy Toeman. - J. D. Ebberly
Jeremy: sorry, I don't buy that. That's the kind of "put your head in the sand and pretend everything is hunky dory" kind of thinking that got us here in the first place. Dan Gillmor was telling me about the coming housing crisis four years ago. I should have listened to him more. Also, this isn't going to be one that confidence can pull us through. Yes, that will help a tiny bit, but we're still in the middle of a very real credit cutback and that will ripple through our economy. And .... - Robert Scoble
Robert - I'm not saying to IGNORE the problems, but running around screaming "fire fire" certainly doesn't get us out of the burning theater any more safely, does it? - Jeremy Toeman
Robert: Optimism is not constrained to throwing on rose colored glasses. @Mark: Why does that scare me? LOL - Mona Nomura
...now people are definitely hoarding. I haven't met anyone who isn't pulling back big time on spending. That, too, will ripple through the economy (and already is -- travel is way down, the car companies are seeing huge drops in sales, etc). Silicon Valley hasn't felt the pain yet, and that's the good thing, but everyone is seeing storm clouds on the horizon and are preparing for a doozy of a storm. - Robert Scoble
Jesse: it's not just the Valley. In New York last week people were freaked out that I was talking with (execs from American Express and other big companies I talked with). And I'm talking with people all over the world who are freaked out. The markets falling got everyone's attention. Fear is rampant all over. - Robert Scoble
Robert: Did you see the map showing who voted for and against the bailout? I think Dave Winer posted it. Almost all of Manhattan was for the original. brb w/ link. http://www.nytimes.com/interac... - Mona Nomura
Jeremy: if my house is on fire, I'm hoping people yell and scream "fire fire" and don't try to sugar coat it and try to pretend my house isn't burning. I think we all arrive at better solutions when we face the truth. The hard truth. And we'll get there sooner if we get to the bottom of our fears. - Robert Scoble
Mona: well, you can see why Manhattan was for a bailout, can't you? New York's economy is going to be decimated by this. Next is Detroit and the rest of our manufacturing jobs. The question is, when does it hit Silicon Valley? I think it'll hit old-time enterprise vendors like Oracle and SAP first. Those are the ones I'll be watching financials for closely. - Robert Scoble
With all due respect Robert, like Windows, quick fixes and patches aren't long term solutions... - Mona Nomura
Jeremy: and the sooner someone comes up with a REAL solution for fear (which many people are genuinely feeling, even if they don't express it online) the sooner we'll find a solution for fixing this long term. But right now the building is burning and we're afraid that we don't know how to put out the fire. That fear is very real and SHOULD be discussed. Putting up a "stiff upper lip" seems to me to be pretty stupid and is horribly bad advice if that stiff upper lip turns out to be wrong. - Robert Scoble
Robert: my scenario wasn't "your house", it's the burning theater, and it's in reference to the famous fire in the early 1900s where the death toll was Massively exarcebated due to panic, hysteria, and people not working together to find a common solution. Your posts and tone are disconcerting because you are not contributing to the solution, merely the panic. - Jeremy Toeman
And if you don't think there's enough "hard truth" already out there, you need to read more. So you can join the panic and let fear overwhelm and Control you, or you can recognize there's a problem and figure out how you can materially contribute to the solution. Reporting More Fear is the job of mainstream media, not you. - Jeremy Toeman
@MarkV: as uncomfortable as it makes me, i think you're on the right track. IMO, this overvaluing has been building since the Reagan era. we've been building debt into the very fabric of the economy for quite some time. it has gotten harder and harder to maintain the fiction and the last several years we jumped the shark. now, the fall is gonna hurt - no matter how 'slow' it goes. - MikeAmundsen
Mark: that's some pretty tough medicine. Those are long-term problems for me personally, the bigger issue is if massive unemployment starts hitting the way it did in 2002. That's going to be really tough to pull out of this time (last time startups and entrepreneurial behavior pulled us out -- some of which, by the way -- was funded on the backs of the strong housing market. Coming out of this one will see lots of people with no credit. - Robert Scoble
Its like Pres. Reagan said "Government isn't the solution; Government is the problem" too many years of using Freddie and Fannie as a political gift basket. In 4-7 years this will work through. What is needed is to Government social engineering out of fiscal policy. Home ownership for everyone was a foolish idea. - Robert Hafer
Jeremy: well, I'm telling you what I'm seeing from tons of conversations all over the place. I'm telling you how I feel. My feelings reflect those of LOTS of people I've talked with. So, if we want to get going in a positive place, you've got to address that fear. So far you've not addressed it, other than to tell me to keep it to myself. That's not going to solve anything. - Robert Scoble
Robert: I really don't care about how we got here. That's for the regulators to worry about and for Congress to figure out so that it doesn't happen again. To argue about that now is to argue about how the fire started. Now that the building is burning, what do we do? It's the helplessness that is causing the fear. It's the fear that we need to work through first (along with trying to keep our banks and institutions solvent). - Robert Scoble
I don't have to do any such thing. I'm certainly not about to say "there there, it'll all work out in the end" (although, obviously, it will). But just because you are fearful doesn't mean you *must* continue writing "the sky is falling" style pieces with titles like "We’re in a death spiral". - Jeremy Toeman
We were never promised anything but our daily bread. It is a hard lesson, but it is the only way to throw fear outside. Do you trust Him to meet your daily needs even when you are faced with mountains of debt? Even if we can save something, we still have tomorrow to face. So take a deep breath and look up, not at your means. Do what you can in faith, and take time now to see what is really important. Then let Him bless what you really need. http://www.biblegateway.com/passage... - Melanie Reed
Jeremy: I tell you what I am seeing happen around the world. If you don't agree with it, tell me why we aren't in a death spiral. I got remarkably little pushback. Here, Asian markets are down 10% tonight: http://biz.yahoo.com/ap... Please, explain how we are NOT in a death spiral? Please do explain how this economy will get healthy. It's headed down and I'm not sure where it'll stop going down, or why. No one can tell me that. So, tell me why we are not in a death spiral and why... - Robert Scoble
...I shouldn't report what I'm seeing happen through my eyes. It seems that you all haven't yet seen the depths of what I've seen and heard and what is going on here. The economy is in a death spiral. My brother thought that meant that we're going all the way down to the ground. No, that's not what it means, it means we're in a downward spiral with no end in sight. That's what we're in right now. - Robert Scoble
Melanie: please keep religion out of my threads. I find it to be repugnant. The belief that religion will get us through is what got us here in the first place. If we had elected leaders based on whether they were smart or not, not whether they were anti-abortion or a "believer" we might not have been in this mess. What's going to get us through this is better ideas. Religion is NOT a "better idea." Been there, done that (I was a believer for more than a decade and saw just how that corrupts our decisions). - Robert Scoble
Robert: 1) the markets are not 100% representations of any economy. 2) there *is* plenty of cash out there, it's just being spent differently (e.g. Buffett buying into GE). 3) economists themselves are in huge debate regarding if/how/when this impacts regular people, and there's the entire possibility that much of the bad is flushed out of the system before it does so. 4) not *every* business operates through debt financing. 5) the bailout might work. 6) at least we don't have ebola! - Jeremy Toeman
and again, it's not my job to convince you about "the death spiral" but i will say again: just as success breeds success, panic causes MORE panic. choose what role *you* want to play in this mess - I've clearly chosen mine. - Jeremy Toeman
Jeremy: almost every business has customers and if those customers are laid off because their businesses can't get debt financing (like auto dealerships that are now closing around the country) then even those "clean" businesses hurt. Everyone is affected by a downturn. That's why the bailout was so necessary. It will take a few months for the bailout to kick in and I'm not sure it'll contain the damage that's now being done to world economies. - Robert Scoble
Jeremy: I choose to report the truth as I see it. That'll serve me well. I'm not a propogandist. If something sucks, I say so. That's how I'll keep my credibility in the end, which is, really, all I have. - Robert Scoble
will there be damage? YES, we all agree. just stop with "the death spiral" phrasing already! - Jeremy Toeman
Jeremy: the phrasing is accurate. If a plane is heading toward the ground, do you want me to say "it's coming in for a hard landing?" No. Sorry. I'd rather have my credibility at the end of the day. If I'm wrong, please demonstrate my phrasing is wrong. Don't tell me to stop saying it. That's wrong. - Robert Scoble
FIRE FIRE FIRE! RUN RUN RUN! wow, that feels so much better! - Jeremy Toeman
Some people are afraid because they don't understand everything that is going on...some are afraid because they do understand everything that is going on. I have to agree that acknowledging that fear is important. I don't think we can sugarcoat what is going on but it is important to make sure we aren't exaggerating the negative. I suspect web-based buisness models like Amazon and Ebay to do better than storefronts during this downturn. - Sidney
Alright, now we're getting somewhere. The sooner we admit our fears, the sooner we can see a way out of this. Aaron: I'm pretty confident we'll all survive. After all, more than half of the world's people live on $2 a day and they seem to be surviving pretty well. Fear is just the destruction of what we thought we knew to be true. So, if I lose my job and lose my house and have to downsize things will still be OK. That's happened to humans (and me) before. Now, where Jeremy could get my confidence going ... - Robert Scoble
...is to say "burn baby burn" but then say " hey, those will create awesome conditions to start a company. Which is very true! I know some entrepreneurs who are rubbing their hands together at the thought of having cheap labor, cheap rent, and lots of hungry people looking to change the world. So, even in a death spiral, there are going to be winners and losers. I'm just trying to get my fear out of my system as quickly as possible so I can see the new reality early and start plotting my moves. :-) - Robert Scoble
Aaron: eBay will be hit a lot harder than Amazon. My ex is an eBay Power Seller and she's been moving her stuff over to Amazon. eBay has made some extraordinarily poor customer service moves lately. - Robert Scoble
@Jeremy Robert is speaking about realities where I think you are speaking about emotion. No one is going to 'feel' better by being told they've lost a quarter of their investments over the last few months but it doesn't make it any less true. You can hear the truth and not jump out the window. Yes people will panic facing these realizations but honestly would they have been part of the solution anyway? - Sidney
Aaron: "the valley" isn't a place, it's a state of mind. Keep in mind I've been traveling and talking to people all over the world. Plus, I'm hanging here on FriendFeed and watching what is going on here and very few of you are from the physical Valley, yet I'm not getting confident replies from many people. If it were just the valley, the Asian markets wouldn't be down 10% tonight. - Robert Scoble
Jeremy: why didn't you counter my "death spiral" with something like Fred Wilson's post: http://www.avc.com/a_vc... -- that's how to counter fear. Show some thinking about where the bottom will come and where investment opportunities are appearing. - Robert Scoble
Robert: that's a loaded question. how about i just say right back: why didn't you just find that on your own before writing lots of panicky stuff? - Jeremy Toeman
Jeremy: this doesn't stop my panic. But is the kind of tactic I'd expect from you rather than just to say "please stop." That's just not going to work when your dealing with people afraid of losing their money or jobs. You have GOT to provide evidence. That onus is on you. Me? I'm a connector and someone looking for patterns. I'm actually more afraid that I'm not seeing the kind of quality pushback that we need to hit bottom. AVC's post gets close, but it is based on some wacky assumptions, me thinks. - Robert Scoble
k, go read these two articles then we can talk more. :) http://twitter.com/jtoeman... - i'm out for the evening, catch ya tomorrow - if you are in SF during the day would be happy to grab a coffee... - Jeremy Toeman
What goes down, must come up. - Mike Reynolds