Opendoor is cutting 35% of its employees

TechCrunch is just reflects the zeitgeist. Softbank was a whale, mentioning them connects this story to the ongoing theme for readers.

> They backed a couple hilariously bad bets in a big, public way, and people like feeling smarter than rich strangers.

The two things are related. The public visions for these companies went beyond the standard startup platitudes about 'making the world a better place'. Regular people can see through that, because they don't live in an SV bubble where playing along with this sort of hubris is encouraged.

I don't think anyone thinks they're smarter than Softbank or Adam Neumann. They may just be enjoying the schadenfreude of this hubris come crashing back to earth once reality entered the picture.

It's not just a couple, and the way they did it is notable. They over-capitalized companies in key sectors like logistics, transportation, robotics, etc.

They pumped in hundreds of millions of dollars per round of funding even when the company might not have needed it (with the threat being "we'll heavily fund your competition if you don't take our deal). Their thesis was to monopolize a few sectors with sheer money and scale.

We're now seeing the effects of that strategy play out.

Don't forget that part of the negativity towards SoftBank comes from the source of most of their funds. At least the majority of their funds in the previous fund they raised.

Yes, but only to flip, a more recent strategy

>Plus supply in the tank because people aren’t moving.

One of the complicated things about housing prices is that people do (mostly) need to live somewhere. Yes, there are homeless and yes people move back in with family etc. But, for the most part, the people getting laid off from, say, Bay Area tech jobs aren't immediately picking up and moving to some cheap city in the Midwest. Especially if they already own a house.

Lenders have already tightened up loan requirements which will decrease the demand part of the equation. It is the same thing that happened during the great recession. People may want to buy, but have no ability to do so. There's also the high unemployment rate and foreign investors liquidating inventory for capital because their country is also going through a downturn. All the ibuyers have stopped purchasing. If the stock market drops, 10% of buyers who use their 401k or IRA for their downpayment will probably dry up.

I don't see any situation where the housing market doesn't drop.

In short order, when inflation takes off, it will be 10%, so we'll get to test that theory.

If the benchmark was 10% a lot more money would go to more traditional investments. And VC funding would be much lower.

What makes you think they aren't? The statewide lockdown was announced a while ago, and as far as I know, has not been lifted.

It's also because we have open laws (sunshine laws) that require things to be published publicly.

It's still good but it seems more like focusing on publicly traded companies. I'm not bashing them, I just don't see the "weird Internet" or "weird startup" content anymore. But then Quibi ships and you see nothing but Quibi for a few days. It's just not how I remembered TC.

> As interest rates rise or housing prices fall

Well that aged like milk.

alot of people are saying it's just a dead cat bounce. REalVision presented that in most of the past drops of this magnitude, you typically see this type of rebound before it goes lower back to retest the recent lows.

That's not what the "market thinks" at all. The stock market is much more complicated than you assume it is. But if you want a really simple explication: 4t$ more in circulation chasing the same amount assets, interest rates make it non viable to hold bonds, and you don't want to buy bonds anyways if you expect a more inflationary economy. If there's expectations of inflation, you go for stocks and if there's inflation AND 0 interest rate, you RUN for stocks.

You can also think of it this way, retail investors can afford staying in cash indefinitely but make up a tiny portion of the capital. Big money NEEDS to either buy bonds or park their capital in any yielding asset. Right now treasuries offer safety but negative real yields for probably a long time. But a pension fund still needs to generate returns to pay it's beneficiaries. So what's the best and cheapest option right now, by far? Stocks. You have to keep in mind that prices are relative so if stocks are relatively cheaper than bonds you buy stocks. Now add 4t$ to that and you get a stock market that stays strong even if everyone in the market knows the huge economic risks we are facing right now.

Never assume that a whole entire sector that has so much incentives to price in all the available data would just ignore something because they feel like it. I don't get how people really believe that.