Comment by matchagaucho | Hacker News Reader

Comment by matchagaucho | Hacker News Reader

(Disclosure: I live in SF Bay area with a bias towards it's long-term success)

It's difficult to predict anything 10 years out.

But when projecting industry trends within a geography I look to Financial Services (FS) as a comparable.

Both Tech and FS sell "virtual goods and services" with a distribution model that does not necessarily lock them down to a location.

But even after the great depression of 1929 and repeated stock market collapses, New York is still a major FS hub.

So, it's really the people and local supporting infrastructure in a region that keep an industry going; not the distribution model.

I assume Silicon Valley will remain a leading tech hub in both consumer and enterprise tech in 10 years. The supporting infra is taken for granted.

Same thing can similarly be said about L.A. and the movie making business. Nothing prevents other locations from making movies, but it's hard to beat a century of built-up supporting infrastructure.

The primary factor being proximity to other people in the same industry is dramatically higher, and jobs within the computer industry in Silicon Valley are so much more dense than any other place on the planet. The joke in SF is that you can't walk 5 feet without running into a programmer or a startup founder. Go to anywhere else in the world and there are comparatively a very small number of programmers/startup founders.

In LA you have something similar with movies -- most people are aspiring actors and there are many people in filming and sets. However, working as a programmer in LA versus SF is very different -- there are a lot fewer engineers and entrepreneurs here per mile than the Bay Area.

It comes down to proximity to people of the same talent set. Where are the people who are good at X living? That's where X is thriving. If suddenly all the engineers left Silicon Valley, it would no longer be a tech hub.

But financial services did distribute across the country. The most important firms and people stayed in NYC. Same with movies and LA. Most production is all around the world now, and LA is losing a lot of that work, but the headquarters and top people are in LA.

>"But even after the great depression of 1929 and repeated stock market collapses, New York is still a major FS hub."

I don't think that a very good indicator. There is a difference between the tech industry and financial services. Financial services depend on markets that have a well known and established opening and closing time. In the US the markets are very much tied to 9:30AM to 4:00PM in the Eastern time zone.

How would that work if Wall Street were to move to US Central Time or Pacific Time? Would workers be expected to get up in the middle of the night?

I don't think a time difference of a couple hours would be that insurmountable, but that doesn't explain why they wouldn't move to, say, Atlanta or Miami.

That's pretty much the definition of a "hub". Wall St doesn't need to relocate. Global markets have adapted to operate on EST. Not the other way around.

I'm not really understanding your argument I guess. My point was that hub of finance for the U.S is largely dependent on co-locating where the sun rises first in the U.S. and Silicon Valley has no such analog. So while the hub of finance could move somewhere else on the East Coast its very much limited to the 17 states in EST and then further limited by states with cities and infrastructure that can support it all.

The finance hub has actually moved a bit. Tt was in Philadelphia before NYC and "Wall Street" moved away from the area around the actual Wall Street after the Sept 11th attacks. Wall Street is largely in midtown Manhattan now and New Jersey. But still on the East Coast.

> I don't think that a very good indicator. There is a difference between the tech industry and financial services. Financial services depend on markets that have a well known and established opening and closing time. In the US the markets are very much tied to 9:30AM to 4:00PM in the Eastern time zone.

That hasn't really been the case for quite some time. A majority of option and equity trading now happens directly rather than on open exchanges and is thus immune to "market hours". Forex is 24 hour. And London is still the finance powerhouse despite not being in the largest economy (and not being in the Euro, but manages the vast majority of Euro bond trading) and in fact being in a country the rest of whose economy is a basket case.

But physical propinquity still matters, it seems, for the human intangibles.

>"That hasn't really been the case for quite some time. A majority of option and equity trading now happens directly rather than on open exchanges and is thus immune to "market hours"

Its not just the actual exchanges like the NYSE or NASDAQ but all of the other participants - the investment banks, the hedge funds, the ratings agencies, the analysts, the financial press. Following the sun, the day breaks first on the East Coast in the U.S. So yes while it could move to Boston, Mass, Charlotte, N.C. or back to Philadelphia where incidentally it was before Wall Street its probably limited to the boundaries of the Eastern Time Zone in U.S.

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