this post was submitted on 29 Jan 2024
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The anticipation is not that it'll hurt the tech companies, but the economy as a whole. A generalized economic slowdown impacts everyone, even if you specifically benefited from it.
If I could tell you exactly how it'll unfold, I'd be using that to make a lot of money instead. It's not even certain that it will happen.
Commercial real estate was for a long time a roughly predictable investment, and profitable.
Now profitability is severely reduced because people, including tech companies, are cutting their usage.
If the market collapses, it's unclear how far down it'll drag the economy, so companies are bracing for it to be bad.
Hopefully they’re wrong. Commercial real estate should have no direct impact on most tech
It shouldn't, but there shouldn't have been a connection between home mortgages and the auto industry either.
It's not just the connectedness of the industry sectors, but their mutual connection to financial markets.
It won't.
It will have indirect impact. The question is how much.
If the entire economy is down, people have less disposable income. The big income areas in tech are advertising, goods sales, monthly streaming services, and cloud compute.
Less disposable income = less people buying things they're advertised, less people buying shit they don't need off Amazon, less people keeping their Prime, Netflix, YouTube Premium, Spotify, or Disney+ accounts active, and less cloud compute resources needed to drive e-commerce websites.