Actually, I believe I share some of the opinions of Rupert Murdoch, as apparently you do as well. He believes the Internet economy will destroy just as much as it will create. One must ask, is value really created in line with the market capitalizations currently afforded to the Internet sector? Indeed, can it be, with so many duplicate companies?
Certainly, "brick and mortar" book and CD stores will be hit by the Internet, as well as any jobs surrounding such. And what about retail renters, and building developers? Rupert is correct in his assertions regarding loss.
What I am suggesting is there may be another casualty of the Internet, beyond what Rupert suggests. To wit, the capital markets may be playing a role in the misallocation of economic resources, moving towards an end where the long-term economic gain is small. Indeed, what potential marginal gain in productivity is there for each new billion dollars invested in Yahoo? At this point, probably none -- but that billion dollars invested elsewhere could effect a large marginal gain.
I'm in the information industry. Whereas computers optimize many types of systems, the information computers move has no real economic value without the underlying brick and mortar. I'm afraid we've lost sense of this fact with regard to US capital markets. The US cannot survive on virtual food, virtual tax revenues, or a virtual military. By the time we discover this, we may have virtually nothing "real" left. |
