Gurley believes Silicon Valley and venture-backed businesses have entered a speculative and unsustainable phase.
“it’s my belief that Silicon Valley and the venture-backed businesses have moved into a world that is both speculative and unsustainable.”
Gurley quotes Druckenmiller saying cheap money drives speculation like oilmen drilling with others' capital.
“Drucker Miller just, you know, who's someone that's made a name in macro investing says, if you give, you know, Texas oilman the ability to drill holes with someone else's money, they'll drill as many as you possibly can. And so low interest rates drive speculation,”
Gurley cites Druckenmiller's analogy that low interest rates drive unlimited speculation with other people's money.
“Drucker Miller just, you know, who's someone that's made a name in macro investing says, if you give, you know, Texas oilman the ability to drill holes with someone else's money, they'll drill as many as you possibly can.”
Gurley says current markets show speculative risk appetite not seen since 1999 tech boom.
“There is certainly what I would call a highly speculative nature to the markets today, a willingness to take on risk, a willingness to get excited about projects that may be five or ten years into the future that we haven't seen since the '99 time frame.”
Gurley argues Robinhood is glorifying speculation rather than democratizing investing.
“And so what what Robinhood's really doing, I think, is kinda glorifying speculation. They're not they're not democratizing investing.”
Gurley says over half of Robinhood's revenue comes from payment for order flow for options, which history shows loses money.
“Over half of the revenue that Robinhood has reported is payment for order flow for options.”
Gurley argues real technology waves necessarily attract speculation and bubble behavior as pairs.
“If the wave is real, then you're going to have bubble like behavior. Like they come together as a pair precisely because anytime there's very quick wealth creation, you're going to get a lot of people that want to come try and take advantage of that or participate in it.”
Gurley argues real disruptive waves like AI naturally create bubbles alongside genuine innovation.
“And so I think that's where we are right now. It's real, it's disruptive, it's amazing, it it's changing a lot of different things in industry.”