Silicon Valley’s venture-capital firms are having an easy time finding promising startups to back. The hard part is cashing out. Last year, U.S. venture firms returned $26 billion worth of shares back to their investors, the lowest amount since 2011. Startup investors say 2024 has continued the trend, with high levels of investment and few acquisition deals or initial public offerings. “We’ve raised a lot of money, and we’ve given very little back,” Thomas Laffont, co-founder of investment firm Coatue Management, said at a recent conference. “We are bleeding cash as an industry.”
China’s biggest technology groups to build artificial intelligence teams in Silicon Valley. Alibaba, ByteDance and Meituan have been expanding their offices in California in recent months, seeking to poach staff from rival US groups who could help them make up ground in the race to profit from generative AI.
The Justice Department said Google should have to sell off its popular Chrome browser as part of a court-ordered fix to its monopolization of the online search market. Chrome controls about two-thirds of the global browser market. Google would also be forbidden from paying to be the default search engine on any browser, including Chrome under its new owner. Google currently pays Apple tens of billions of dollars a year to be the default on its Safari browser.
Archegos Capital Management founder Bill Hwang was sentenced to 18 years in prison. Archegos’s meltdown shook Wall Street in spring of 2021 when Hwang’s highly concentrated bets went south. Using borrowed money and derivatives that masked the firm’s colossal exposure, Archegos had invested in the same small group of stocks at several banks. The losses spread across the banks that held the investments for the firm, including Morgan Stanley, UBS, Credit Suisse and Nomura. The firm’s collapse wiped out $100 billion in market value, according to prosecutors.
A year ago, Warren Buffett’s Berkshire Hathaway had an already stupendous $157.2 billion in cash and short-term investments. By this Sept. 30, the company had more than doubled that hoard to $325.2 billion. Berkshire could buy all of the 40 smallest companies in the S&P 500, combined, at their current market value. This mountain of cash is greater than the gross domestic product of 55 of the world's nations put together, according to the World Bank.
The Biden administration finalized an agreement that provides TSMC, which manufactures about three-quarters of the world’s most cutting-edge computer chips for Nvidia and others, with $6.6bn in grants to build factories in America. With an additional $5bn in loans, it is the first big deal to be completed under the Chips Act of 2022. In October Donald Trump said that the “chip deal is so bad” because it benefits only “rich companies”.
"ECONOMISTS SOMETIMES say that China suffers from the three Ds: debt, deflation and poor demography. America’s presidential election added a fourth: Donald Trump, who has threatened to slap high tariffs on Chinese exports when he returns to the White House."
“Going public is a little like wetting your pants. It's warm and comfortable for a few minutes. But then after that...” From Acquired: IKEA, Nov 18, 2024
From Berkshire Hathaway's annual meeting in 1988: Is there any value in market predictions or forecasts? *“If I live X number of years,” said Buffett, “I’ll go through X number of recessions. But if I spent all my time guessing cycles, Berkshire Hathaway would be $15 per share. You can’t dance in and out of businesses based on forecasts.”*