YouTube disallowing adblockers, Reddit charging for API usage, Twitter blocking non-registered users. These events happen almost at the same time. Is this one of the effects of the tech bubble burst?

  • merc
    95·
    1 year ago

    It’s the end of cheap credit.

    https://fred.stlouisfed.org/graph/fredgraph.png?g=16J5X

    That graph shows the Federal Funds Effective Rate. Until recently, VCs could borrow money while effectively paying zero interest. That meant their investments weren’t under any pressure to become profitable any time soon. Now, borrowing is expensive. VCs don’t want to loan any more money, and want their investments to pay off. Reddit and other pre-IPO companies are scrambling to become profitable.

    I assume the big companies like YouTube / Google going against people blocking ads are just taking advantage of the chaos.

    As for Twitter: Elon Musk is an idiot.

    • zos_kia@lemmy.fmhy.ml
      72·
      1 year ago

      This meme is repeated everywhere ad nauseam and is blatantly wrong. VCs do not borrow money from the banks. The argument goes the other way around, and implies that the people who bankroll VCs would rather lend their money through banks than invest it - but even that is bullshit, you’d need interest rates in the double digits to even begin to be in competition with your average VC performance.

      Also not 100% of VC money is american so Fed rates are not as relevant as you think. Please stop spreading that nonsense.

      • zygo_histo_morpheus@programming.dev
        3·
        1 year ago

        It’s not just the american federal reserve that’s increasing it’s rates. We live in a globally connected economy and almost all countries are impacted by the american economy as well as some of the reasons causing inflation in the US (the pandemic and the war). Most countries are affected by the inflation and most countries are combating it by hiking interest rates.