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Comment by godelski | Hacker News Reader

As a reminder, even Apple didn't hit 1T market cap until late 2018. We didn't get a second in the 4 comma club until mid 2019 with MSFT. Google and Facebook in 2021.

And now we have 4 companies above 3T and 11 in the 4 comma club. Back when the iPhone was released oil companies were at the top and they were barely hitting 500B.

So yeah, I don't think anyone has really been displaced. Nvidia at up, Broadcom at 7, and TSMC at 9 indicate that displacement might occur, but that's also not the displacement people are talking about.

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I don't entirely know what to make of a very-small number of companies' valuations going sky-high that fast (and a few completely without any apparent connection to the fundamentals or even the best-plausible-case mid-term future of those fundamentals, like Tesla) but I can't help but think it means something is extremely broken in the economy, and it's not going to end well.

Maybe we all should have been a little more pro-actively freaked out when dividends went from standard to all-but extinct, and nobody in the investor class seemed to mind... like, it seems that the balance between "owning things that directly make money through productive activity" and "owning things that I expect to go up in value" has gotten completely out-of-wack in favor of the latter.

My guess? Hype. All the companies at the top have a lot of hype. I don't think that explains everything, but I believe it is an important factor. I also think with tech we've really entered a Lemon Market. It is very difficult to tell the quality of products prior to purchase. This is even more true with the loss of physical retail. I actually really miss stores like Sharper Image. Not because I want to buy the over priced stuff, but because you would go into those stores and try things.

I definitely think the economy has shifted and we can see it in our sector. The old deal used to be that we could make good products and good profits. But now "the customer" is not the person that buys the product, it is the shareholder. Shareholder profits should reflect what the market value of the product being sold to customers, but it doesn't have to. So if we're just trying to maximize profits then I think there is no surprise when these things start to diverge.

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