Home owns are owned by people, not the home itself. If someone fails to pay a loan, their own credit score will be impacted
For these PE loans, its the new company that takes on the debt, not the buyer. Essentially any broke person can "afford" any trillion dollar company this way
Home loans are secured by the asset (the home). It's comparable to stock, but it's a less liquid asset.
Any broke person can afford a trillion dollar loan, if they can convince the bank that their house is worth 1.8 trillion dollars. But is that really possible?
Loan companies do due diligence so if GameStop is $A and eBay is worth $A + $B, then so long as $A/$B remains the same, the acquiring company owns two assets worth the full price of the loan.
It doesn't seem to be a scam to me. Am I missing something?
The difference is that when you buy a home the debt is in your name and you are required to pay it off. In a leveraged buy out wouldn't be to person taking out the loan, the debt is owned by the target of the purchase. If it were like a home loan and this deal goes south GameStop would go bankrupt and have to sell it's own assets to cover the losses. But in reality the debt from the deal would be owned by Ebay and if GameStop can't pay the loan back it'd force Ebay into bankruptcy and sell Ebay's assets. It's essentially a riskless move by GameStop and PE in general. Heads GameStop wins tails Ebay loses
There are other categories of real estate loans where the debt is against the property itself. The lender evaluates the property's income and expenses when underwriting the loan.
Fair point, it's a corporation taking out the loan so there's nobody to go after if the company goes under the way there is if the value of your house tanks and you stop paying your mortgage. But doesn't the bank take that risk into account when deciding whether to issue the loan? Why should that be illegal?
The way I’m reading your question, it seems like you are looking for the law to follow philosophically consistent principles.
That is simply not the case and lawmakers can make any kind of law to shape the society how we wish. If leveraged buyouts are creating problems for the country, then it’s totally valid to make them illegal in certain cases.
The problem is that people can take loans without financial liability (not how home purchases work) and drive profitable businesses (which are good for the economy) into the ground (bad for the economy and society).
No one is worried about the bank making the loan in this situation. They are concerned that PE is buying up large parts of the economy using debt they aren't responsible for, which makes them irresponsible owners because they do not face consequences when the moves fail
> which makes them irresponsible owners because they do not face consequences when the moves fail
Again, isn't that entirely the bank's problem? They're responsible for the debt if the company can't pay it, right? I agree on the surface this seems like a bad deal for the bank, but what makes you think you know better than the bank so much so that they shouldn't even be allowed to take that risk?
Leaving aside that the new company is the buyer; the point remains that home and car loans are leveraged loans. With the main asset in the leverage being that which is being bought. Defaulting on that loan results in the assets going to the lender.
If a lender builds a pattern of lending to people that can't make the payments, that lender will take a hit. If we think that isn't happening, why? And how could we return us to that?
Or, back to my question, how would you structure a legal framework where some loans can be done this way, but others could not? (I can think of a few ways, largely curious if I have a blind spot here.)
eBay is dying, new competitors are being created constantly, and the big ones like Poshmark are getting more North American buyers and sellers. eBay has barely grown since their post covid slump
Maybe eBay survives as an international site but even at that point, with $20B in debt this will just follow the regular PE playbook of shutting down after many layoffs and pivots
The entire concept of, "I have $1,000 in the bank, im going to buy a $10,000 company, but the debt will be on the companies name, not mine" needs to pass. Can you imagine if the mortgage was owned by our home, not ourselves. And we could stop paying it without any personal consequences
If you want to buy a $50B company, you should pay $50B (loans are fine, but not putting the new company in debt)
I don't really know what alternative there is to eBay as an 'everything shop'. I can get specific screws there, or diff fluid, or a customised motorhome name sticker, or an old baseball cap for an airshow I attended in 2008.
And if I bought the wrong diff fluid I can sell it.
The main value over Amazon, though, is that the search works.
> The main value over Amazon, though, is that the search works.
Super true. You can actually search for the exact brand you want and not get a search result page full of brands XIAOLE, LLKAPOO, JEMROK, QPPNSS, VRINHH.
Also, I don't really know why, but I have much greater confidence on eBay that I'm not going to get something counterfeit or unsafe.
At this point, online fraud control is getting absurd, and AI is just making it untenable. I simply won't use ebay for anything above $50 anymore.
Having physical locations that you have to come to pick up your Thneed protects both buyer and seller. Buyer can verify that what was described is delivered and seller can verify actual pickup with ID.
If they apply a bit of logistics for shipping between stores, Gamestop could crush it.
Fraud is forcing the pendulum to swing from everything-online back to everything-in-person.
Facebook marketplace is an everything shop, though a bit more local in nature. Also, it's much easier for small businesses that ship to have an online store thanks to Shopify, etc.
The last few times I've used EBay is to get parts for old garden tractors, and even for that I've found cheaper options with small retailers that specialize in that stuff. Most ebay shipping pushes the cost up too much, and with the small retailers usually I can get a bunch of things I need at the same shipping price.
FB Marketplace is full of scammers too. Every time we've tried to sell something, we've had people try to steal our phone number and register it with their Google Voice account.
Interesting you think that because my main experience is the search is horribly broken and they do nothing globally to fix it. Most of it saved searches are full of exclusions because a positive search includes so many irrelevant items. And they don’t enforce categorization so listers constantly put in better categories for their items, when they aren’t just lying with things like “calculator not HP”.
> Can you imagine if the mortgage was owned by our home, not ourselves. And we could stop paying it without any personal consequences
To a large degree you can just stop paying your mortgage.
The biggest personal consequence is you will be evicted and lose both your place to live and any equity you built up.
The other main consequence is it will show up on your credit report for 7 years. Maybe some specific forms ask "have you ever been foreclosed on" in the future.
This depends entirely on your local laws and the kinds of loans banks offer.
In most places, you can only get recourse mortgages. You will be liable for the rest of the mortgage, if the value of the house drops so much that selling it doesn't cover the remaining debt.
House values dropping a lot is something that happens fairly rarely, but it tends to happen exactly during the times when you are most likely to be unable to pay your mortgage (recessions, industry downturns, etc.)
Even in recourse mortgages, banks tend to write off the remainder owed. Especially since it is cheap for them to offer to forgive the remainder to shorten the eviction process and prevent damage to the home. At least historically
Of course, if it's not your primary home, they don't need you to waive your rights to stay in the property.
As a side effect of bailing out banks they have a lower risk profile than entities that don’t get bailouts. It’s essentially an additional subsidy on top of the already generous ‘money creation’ they’re allowed to do. It’s impossible to compete against this. The riskier the bets the stronger the subsidy so of course they’ll crank risk up to 11. Since the fate of banks and pensions are tied you can’t punish the banks without also punishing pensioners and pensioners are a strong voting block. It’s a distorted economic system that can only either crash or become more distorted. Since becoming more distorted enriches the already wealthy then that’s the only option that will be taken. The only thing that can stop it is to run out of resources to spend trying to save it. Importing a large number of foreigners is a rather creative (desperate) solution. I don’t know how long this will last but I’m confident I will see a major economic calamity in my lifetime.
I mean I don't love eBay, but it's certainly not dying, where did you get that idea? Its revenue has continued to grow every year post-COVID, and competitors all face the central challenge of eBay's network effect.
It's not experience massive growth but that's because it's a pretty mature market by this point. People who want to sell their stuff already use eBay. It works. It's mature.
if you've ever been through a Meta loop (and their method is to cast an extremely wide net, so chances are you have), you've seen how inefficient their loop can be for long term success
6-7 38* minute interviews, while the interviewee is trying to squeeze in showcasing their skills and experience, the interviewer is obsessed with figuring out a rigid set of pre-determined "signals"
Once these candidates actually start work, their success in the team is a complete coinflip
* 38 minutes = 45 minute scheduled - 2 minute intro - 5 minute saved for candidate questions at the end
That wasn't my experience at all. I had a recruiter screen where she asked me some technical questions. I then had a longer discussion, then a code screen, then an arch-deep-dive. The entire process was very professional and EVERY person came off like they really wanted me to succeed. (Sure it's an act but it's a very helpful act when you're in the hot seat)
My intervews were in 20202/2021. Perhaps things have changed?
Things have changed. I worked with a very senior and professional recruiter at FB during that time. While things didn't work out then, someone else reached maybe a year and a half ago for a fairly similar role -- massive difference, strictly a disposable drone style process and barely a conversation. I chose to not even start the process.
A sample size of one but many anecdotes together can make a trend.
I interviewed in the past 2 years and my experience matches the parent. Very professional and the interviewers were great to talk to. Same with Google.
Back in 2020, $META was desperate to hire. Nowadays the tide has turned and interview process shifted accordingly. They are super picky now, even for those who nail every stage of the interview, folks are still routinely passed over.
So let me ask this. What is the perfect mix of inerviews and durations?
If you ask my blue collar friends, the answer is one and however long it takes to drink three beers.
If you ask any married person, the onboarding process (courtship) may last YEARS and consist of many interviews (dates).
As an EM, ive always struggled with this one. Im about to invest some serious coin and brainspace for you, so I tended towards a max of 3-6 total hours and a takehome assignment.
As an IC, I preferred short and sweet. Heres my portfolio (github), heres my resume. Lets make this work. Maybe 1-2 hours; its not like we're getting married.
The happy place has to be in there somewhere. Whats your take?
I’ve never worked at big tech but the usual interview process I’ve seen is one initial phone call to check both sides are on the same page and it’s worth scheduling an interview. Then a technical interview, sometimes a take home task, then a non technical interview with management. There’s no reason you need longer than that.
The "usual" process in big tech is a recruiter call, 1-2 technical screening calls (sometimes an EM call), then the main series of 3-6 domain knowledge interviews are done over 1-2 days.
The latter are pretty grueling, especially when conducted on-site. Apple recommends you show up 1-2 hours ahead so you have enough time to get through security, for example.
That might be fine if they are offering incredible pay and conditions at a highly desirable company. But you get so many mid tier companies looking at Apple and Google and replicating their process without the pay or reason to put up with that process.
I just eject from the interview process when I hear it's going to be so many rounds because I know there will be another company that's just as good that will get it done with less.
At my last job we generally had 3 interviews beyond the initial screening. One was a coding challenge (1 hour with 45 really working on the challenge), one was an architecture discussion, and one was more of a culture fit and similar with the hiring manager.
It worked very well for us, I was a bit surprised with some of the red flags that showed up that I wouldn't have expected to be caught in the hiring rounds done at previous jobs.
Pilot at a major airline here: 1.5 hours of interviews with two people (recruiter and another pilot). Technical and HR-style questions, a personality test, no other homework.
Blood test, background check including all prior training records that are reported to the FAA.
Not a lot of work for the candidate in the interview, but it's easy to fail one too many training events or accumulate a violation and become radioactive.
While I cannot respond as a doctor, I can respond as an EMT. Totally different. But heres the deal.
The person who is the most important to you on the worst day of your life is the emt. The interview was literally "do you have a drivers license, and are you grossed out by stuff?" The rest you learned on the job.
Weird how doctors are vetted but prehospital folk are not.
edit yes there is training, but it happens after hire
Pilots and doctors are exhaustively certified for a very narrow set of work. A cop gets a title, to perform a job that's identical in every part of the country.
Software development is neither exhaustively certified, nor narrow, nor perfectly transposable.
Developers want a 15 minutes interview, but also scream "Would you ask a builder if he has experience with blue hammers specifically?" when they get denied an interview because they do not have experience with the exact tech stack of a company.
Because that's how pilots and doctors work. They not only need to have experience with a blue hammer specifically, but it needs to be exact same make and model.
Imagine if a GP claimed to be neurosurgeon because they cured a headache. Developers get to call themselves fullstack the day they modify an API route.
My doctor probably thinks we software developers do a very narrow job. And she is kind of right, we always turn up with those back problems from sitting too much, or RSI or whatever. While doctors have all those medical specializations and different roles and employers.
Doctors are continually interviewed every time a patient gets pissed and sues them or files a board complaint. If there's any fault they're (very publicly) assigned remedial training or put on a PIP. They're also in incredibly high demand, so its often the doctor interviewing the practice.
If the interview is for becoming a partner at a practice, it's a two way courtship that's more reminiscent of other businesses looking for a co-owner.
Doctors also tend to hear about each other. Even in decent sized metro areas, they can often know who to avoid.
(This process isn't perfect, but it's still way different than for software.)
Rigorous formal education, multiple rigorous exams, then years of shadowing and training. I went through this process, and tech interviews are a breeze by comparison.
That's presumably what he meant but the response is highly relevant nonetheless. Comparing credentialed and noncredentialed professions is apples to oranges here because the credentialed professions effectively consist of pools of prescreened candidates. Among those, MDs in particular have an absolutely grueling process before they can get started. Imagine if your surgeon (versus backend dev) was proud of being self taught.
The short interview time helps keeping the interview process focused on high signal questions/discussions. That is better than a 1h where 1/3 of the process is a bunch of soft balls.
What I don’t like about them is how “dry” and mechanical the interview feels
I believe they optimize for fairness and consistency. They interview a huge number of people from very different backgrounds so they need a standardized process. It's not perfect but I can understand the logic. And there's team matching phase if the candidate pass the interview, it's not a random allocation.
This was exactly my experience too. The interviewer seemed more focused on checking boxes on the grading rubric than actually understanding the design discussion. They barely engaged with alternative approaches.
The interviewer was also very hard for me to understand, which made the interview harder than it should have been.
I am ESL too, so this is not about someone’s background. The problem is communication in an interview where both sides need to understand each other clearly.
From what I have seen on Blind, others have had similar experiences.
Labubus peaking and falling doesnt really say much about scarcity and trends. Labubu is made by a public company, who's stock skyrocketed, and essentially decided to go all in and mass produce to meet the popularity
thats one option. But other companies sometimes choose to keep the scarcity and secrecy for years, even decades, and if they play their cards right it keeps working
Labubus fall is more about its makers decision to increase sales numbers instead of keeping them flat and generating more and more and more hype
Hermes can sell a $15,000 Birkin to everyone, im sure they can figure out the supply chain aspects if they really wanted to. and within a month everyone that wanted one would have one and sales would drop. Hermes will have a spike in sales, followed by a drop
Instead they force you to play years long games with their sales staff to get an opportunity to spend $15,000. And decades later people still opt in to spending thousands of dollars on plates and scarves hoping one day they will be offered one
This is just as true about a $40 Supreme, or Aime Leon Dore T-shirt, than it is for a $15,000 handbag. If you keep the scarcity going just right, it lasts much longer
That might be true of handbags, I am doubtful it is true of dolls. A handbag is a necessary accessory and has been for decades. The popular brands grew their way there slowly over many years. A company that explodes into popularity suddenly for a product people never knew they needed is likely to only stay in the spotlight for a short while and is best served taking advantage as best they can.
I agree that cashing in quickly before the fad faded was probably the right move for Labubu. However, there’s no world where Birkins (or other designer handbags) are a “necessary accessory”.
A handbag is necessary for many people to carry their thing. Whether they choose a more or less expensive item to fulfill that function is a separate question.
A lot of designer handbags are truly awful at carrying things. In practice they are primarily used as fashion accessory rather than as a functional bag.
True, but this does not particularly apply to the Birkin, which was famously created for the actress Jane Birkin after she complained to the CEO of Hermes that she couldn’t get a bag big enough to hold both scripts and baby diapers. Sure, it’s not as good at carrying things as a backpack, but it’s not bad either.
It does delight me no end to see a whole thread on handbags on HN. I agree with one of the parent posters though, handbags are an unusual category with long-lived brand status (like cars and watches) and not really comparable to lububus.
> which was famously created for the actress Jane Birkin after she complained to the CEO of Hermes that she couldn’t get a bag big enough to hold both scripts and baby diapers. Sure, it’s not as good at carrying things as a backpack, but it’s not bad either.
I checked this out and was amused to see that wikipedia notes:
> Birkin used the bag initially but later changed her mind because she was carrying too many things in it: "What's the use of having a second one?" she said laughingly. "You only need one and that busts your arm; they're bloody heavy. I'm going to have an operation for tendonitis in the shoulder".
In my experience it's pretty common to carry stuff in backpacks. They put a lot of weight on your spine, which can take it. Jane Birkin's comment reminded me of the idea in Dave Barry's Only Travel Guide You'll Ever Need that frequent travelers are always on the lookout for luggage that can hold more than it can actually hold.
I always found the birkin interesting because of how working class it looks versus its price tag. I grew up fairly poor, and the birkin bags always remind me of the leather purses my aunts, grandmothers, and teachers would carry.
This seems to occur in high fashion a lot, an upscale rendition of something popular among the working class.
It happens in fashion going both ways for a variety of reasons, though with fast fashion it's all so intermingled.
Many rock bands with working class roots "bring up" styles (like the newsboy cap), but also lower classes try and "look" upwards which can give us the nouveau riche clichés. Celebrities trying to hid their identity in public started to wear large sunglasses and suddenly everybody would start to wear them.
It's the primary reason why brands have become so important - fabric quality can vary, but jeans are otherwise just jeans; slap Gucci or Prada on it and suddenly you're signalling conspicuous consumption.
> This is just as true about a $40 Supreme, or Aime Leon Dore T-shirt, than it is for a $15,000 handbag.
According to a more fashion and design orientated friend of mine, you can buy knockoffs of Birkin or any other high-end bag. And, guess what? Some of those knockoffs and their manufacturers have developed a certain cachet, and actually sell for quite high prices. So of course, those have spawned knockoffs too.
It's like the bit in Pattern Recognition, isn't it?
There are whole subreddits devoted to this, the most well-known being repladies, which went private after it got too famous due to an NYT article. People will spend $1000 or more for a really good Birkin knockoff with high quality leather and hardware. The bags are almost all made in workshops in China. Getting one is apparently (I haven’t done it myself) an interesting exercise in trust and reputation: how do you know the seller isn’t going to send you a cheap knockoff from China rather than a “real” $1000 knockoff? In practice there is a whole world of trusted Chinese middlemen with reviews etc. who have a strong stake in keeping their reputation high in the “reps” community (but you’d better make sure the reviews are real…).
It's sad and petty I know, but if I were a billionaire edgelord like Elon Musk, rather than Twitter, I'd buy Hermes and sell their products in supermarkets. All the past limited editions too. Just to fuck with the kind of people who buy them.
Then again Hermes is worth 200 billion and upsetting an oligarch's sidechick might just get me killed so maybe not.
He probably couldn't buy it if he wanted. They built their stock structure to be resistant to takeover attempts and instead they are controlled by a family holding. I _guess_ if Musk slings his whole fortune at it he might get it, but unlikely. Hermes is a very interesting company, I recommend the Acquired episode on them, along with the one about LVMH.
All that would happen is the Birkin would lose its appeal and some other company would step in to fill the role, and people would empty their closets of orange boxes and fill them with some other colour box
Like, I get that you were referring to the fact that they keep things scarce even for rich people, but you literally said “everyone”, so I just gotta check: Are you saying that everyday people would be willing and able to spend $15000 on a luxury handbag?
The sale of new Birkin bags is famously invite-only. In that context, to "sell" to "everyone" means making the bag available for sale to everyone. "Anyone" would have been a less ambiguous word choice, but it's a minor grammatical issue and the meaning is still clear.
There was an implied ‘who is on the waiting list for a Birkin bag currently’ in ‘everyone’. They did not mean every single person on Earth, they meant Hermes could sell a Birkin bag to every interested buyer.
When sales are still growing YoY (like the post covid market), but prices are up 30% or 40%, you understand your customer is still willing to pay the higher price
Its similar to a McDonalds or Starbucks situation where you just keep increasing prices dramatically until you get a first quarter of lower than expected sales, then you start adapting downwards
Most corporations still haven't hit that limit, see streaming companies increasing prices every few months, they still haven't hit the point where profits decrease YoY. When they do the streaming prices start decreasing
They can do it because people are hopelessly addicted to screens.
You won't die if you stop watching Netflix. We aren't talking food or medicine here. In fact your life would probably improve. But addiction is a real animal.
I wish there were some term other than addiction here: addicts routinely steal from friends and family to feed their addiction; addicts who are parents sometimes threaten to stop allowing their children to visit with a grandparent unless the grandparent helps the addict pay for the addiction; drug addicts living in violent neighborhoods sometimes agree to murder somebody in exchange for drugs.
Screen addicts almost never stoop that low and the ones that do are addicted to a cam girl (e.g., Grant Amato), porn or gambling, not Netflix (or social media).
a company with 800 million weekly active users, and only losing $10B-$15B before implementing ads - which IMO is coming fast and soon to the LLM world - i would never calculate a 90% chance their shares end up at $0 before an exit option
This is the easiest money and best relationship JPM could imagine
Yahoo is a disingenuous parallel here. Yahoo lost because they didn't correctly embrace their market position in what's otherwise the very ripe industry of search engines. Search engines created the 4th most valuable company in the world (Google).
We don't know how ripe OpenAI's industry or market position is, yet. Yahoo knew what they had lost pretty early onto its spiral.
So GME dilutes by 20%, stock price immediately goes down by 20%. its not some infinite money hack
reply