My prediction for 2040 is Microsoft. It's mainly based on two things.
1. The Lindy effect: A theorised phenomenon by which the future life expectancy of some non-perishable things, like a technology or an idea, is proportional to their current age. (Not a very strong argument)
2. Enterprise customers - Microsoft generates a lot of business from enterprise customers and these are extremely sticky. I don't see Excel, Windows and Outlook being replaced anytime soon.
Apple is a close second due to their ecosystem but for me they are one bad iPhone away from tough times.
Fair enough. My argument against Amazon is that I have not seen a single person who is happy working there. The culture is brutal and I guess most of the talent would leave once the stock rally stops + Bezos has left.
A sweet trillion dollar spinout in AWS might make them stick around a bit :) Also (highly speculative) the era of lovely working conditions as commensurate with valuable companies might've been a short-lived aberration in Google. Everyone else across eras were relatively brutal, or at least matter of fact.
Oct 9, 2022·edited Oct 9, 2022Liked by Market Sentiment
Agreed. I actually think there's a chance Google, Amazon, and Meta (through re-invention) could be in the top 10 then too, based on moat and (presently) tolerated monopoly.
A feature of laissez-faire capitalism (the right's favorite flavor of capitalism) is that the big get bigger and the rich get richer. Doesn't mean competition doesn't exist or that the big can't stumble, just that the playing field may be slanted.
*edit: I can also see a world where NVDA is near one of its cyclical peaks (as in 2021) and is back in the top 10 in 2040
I mean if google willing to adopt the idea of Web3 (which I highly doubt since they earn revenue from your data). Once Presearch have gathered large enough data, I bet there would be more people using it, since you get rewarded. Also browser like Brave would definitely be the future, since anything crypto related are in a way future technology that still have larger space to evolve into something big.
Microsoft's enterprise business definitely puts it higher than Apple but I still see both companies as possibly being in the "too big to fail" category. 52% of Apple's 2021 revenue came from sales, meaning not only new products are needed but popular products (iPhones, iPads, iMacs, etc.) are key for their success. The recent report about iPhone 14 demand is not promising but I am optimistic that Apple will be able to push through the tough economic conditions that are affecting competitors and the global economy.
I agree that we are nowhere near the end of Carbon based fuels. But that doesnt mean that those companies will continue to grow at the pace tech is growing. Overall, in 2040, Exxon might be bigger than it is today, but I dont see it being the biggest.
True. But mostly because of the countries that listed on either NIC, Development, and Underdevelopment country. Unless they want to adopt the idea of using Plastic for anything. Which some companies have successfully created it. Also green source electricity is doable in many countries in both Africa and Asia continent. The problem is how fast can it become cheaper to adopt. I mean fx. right now, solar powered panel are still more expensive than fossil fuel. And so on, and so on..
I agree with the assessment that we are nowhere near the end of a carbon based economy. Even if we do transition, the transition itself requires huge amounts of fossil fuels. And if you know anything about building complicated factories, 20 years is a very short space of time. If it is enough to propel Exxon in the top 20, I don't know.
20 years are very short for a lot of things, but not for this. Stuff keeps changing faster than ppl and most ppl are ill equipped adapting. Between 1933 and 1953 are just two decades, but totally different worlds. And if we don’t have solved our fossil fuel addiction by 2040, we won’t worry about the stock market then.
We need to move Steel making, cement and plastics to a process based on green Hydrogen. We are just starting to build pilot plants for green hydrogen. It will take at least 15 years to get production plants operational. Then we need develop new processes for those materials and scale up. A part of that will be done in parallel, but scale up is another 15 years. For reference, the latest oil refinery (a well known technology) took nearly 13 years to build. You ROFL all you like, but this is reality. And yet, humanity will survive.
To be clear: I also think we should put every effort to reduce CO2 emissions. Most people think transportation is the biggest problem; that is actually only 4% of emissions. The big chunk is in raw materials, steel, f.i. is 7% of carbon emission, cement is bigger. Here is a (in my opinion far to optimistic) roadmap for steel by the IEA; halving the CO2 emissions by 2050. I think we need to move quicker, but I don't see any big producers moving. I try to point this out to as many people as possible, maybe something will change. https://www.iea.org/reports/iron-and-steel-technology-roadmap
In the past 20 years we have invested $3.2 trillion on renewables and reduced global consumption of fossil fuels from 82% to 81%. You think the next 20 years will be different? ROFL
I think if the supply chain issues last much longer wrt high end semiconductors, we are going to see significant constraints to growth within the tech sector. We have to watch ASML carefully as they are the only ones on the planet who have the technology to make and service the machines that can etch 5 nanometer line widths. Why is this important? Because every tech company (AAPL, MSFT, IBM, TSLA, etc.) that manufactures a product is not producing these wafers and the integrated circuits themselves but they sure do install them in their phones, cars and computers. ASML has withdrawn their workers from China. Now, China has beaucoup ASML machines yet they do not have the expertise to run and service them. These systems are about the size of a bus. China has a significant number of these "buses" that are now idle.
I’m going to be the one who says all 4 of those tech companies you listed stay in the top 10, mainly because I think that those companies have positioned themselves well enough where 18 years isn’t long enough to bring them out of the top 10. (I would write more but I’m writing this way after this article was written anyway).
That being said in 40 years I think all of these companies could struggle to stay high, particularly google and apple.
Almost all of Google’s revenue comes from ads, and I think there’s a world where advertising will start to go more direct to consumer, and skip such heavy reliance on middle men like google. The way they are and will always be able to defend this is through having massive amounts of data, where there status as a middle man also helps optimize the ads you’re putting out, but that’s not something that usually lasts forever.
I also think apples interface isolationism has to come back and bite them at some point, but obviously they have built themselves the most cushion by far.
I think it's Amazon. They are diversifying heavily (consumer goods, grocery, pharmacy, etc.) and they are the uncontested leader in logistics. Not only that but they have the largest enterprise cloud business on the market. As we move to an increasingly digital world, Amazon will continue to bridge the gap between the digital and the physical.
Plus they also have the best selling home smart speaker = huge data mining opportunity on consumers. I think AMZN will be there. Another company that I see in the mix is Tesla. They got the early jump on the e-car market but are also diversified in green energy generation and storage. Tesla is also a leader in AI as applied to robotics.
My prediction for 2040 is Microsoft. It's mainly based on two things.
1. The Lindy effect: A theorised phenomenon by which the future life expectancy of some non-perishable things, like a technology or an idea, is proportional to their current age. (Not a very strong argument)
2. Enterprise customers - Microsoft generates a lot of business from enterprise customers and these are extremely sticky. I don't see Excel, Windows and Outlook being replaced anytime soon.
Apple is a close second due to their ecosystem but for me they are one bad iPhone away from tough times.
I agree, though Amazon is about equal due to AWS.
Fair enough. My argument against Amazon is that I have not seen a single person who is happy working there. The culture is brutal and I guess most of the talent would leave once the stock rally stops + Bezos has left.
A sweet trillion dollar spinout in AWS might make them stick around a bit :) Also (highly speculative) the era of lovely working conditions as commensurate with valuable companies might've been a short-lived aberration in Google. Everyone else across eras were relatively brutal, or at least matter of fact.
Agreed. I actually think there's a chance Google, Amazon, and Meta (through re-invention) could be in the top 10 then too, based on moat and (presently) tolerated monopoly.
A feature of laissez-faire capitalism (the right's favorite flavor of capitalism) is that the big get bigger and the rich get richer. Doesn't mean competition doesn't exist or that the big can't stumble, just that the playing field may be slanted.
*edit: I can also see a world where NVDA is near one of its cyclical peaks (as in 2021) and is back in the top 10 in 2040
I mean if google willing to adopt the idea of Web3 (which I highly doubt since they earn revenue from your data). Once Presearch have gathered large enough data, I bet there would be more people using it, since you get rewarded. Also browser like Brave would definitely be the future, since anything crypto related are in a way future technology that still have larger space to evolve into something big.
Microsoft's enterprise business definitely puts it higher than Apple but I still see both companies as possibly being in the "too big to fail" category. 52% of Apple's 2021 revenue came from sales, meaning not only new products are needed but popular products (iPhones, iPads, iMacs, etc.) are key for their success. The recent report about iPhone 14 demand is not promising but I am optimistic that Apple will be able to push through the tough economic conditions that are affecting competitors and the global economy.
🤝
If it is only 20 years, Exxon. We are nowhere near the end of carbon-based fuels.
I agree that we are nowhere near the end of Carbon based fuels. But that doesnt mean that those companies will continue to grow at the pace tech is growing. Overall, in 2040, Exxon might be bigger than it is today, but I dont see it being the biggest.
True. But mostly because of the countries that listed on either NIC, Development, and Underdevelopment country. Unless they want to adopt the idea of using Plastic for anything. Which some companies have successfully created it. Also green source electricity is doable in many countries in both Africa and Asia continent. The problem is how fast can it become cheaper to adopt. I mean fx. right now, solar powered panel are still more expensive than fossil fuel. And so on, and so on..
I agree with the assessment that we are nowhere near the end of a carbon based economy. Even if we do transition, the transition itself requires huge amounts of fossil fuels. And if you know anything about building complicated factories, 20 years is a very short space of time. If it is enough to propel Exxon in the top 20, I don't know.
20 years are very short for a lot of things, but not for this. Stuff keeps changing faster than ppl and most ppl are ill equipped adapting. Between 1933 and 1953 are just two decades, but totally different worlds. And if we don’t have solved our fossil fuel addiction by 2040, we won’t worry about the stock market then.
We need to move Steel making, cement and plastics to a process based on green Hydrogen. We are just starting to build pilot plants for green hydrogen. It will take at least 15 years to get production plants operational. Then we need develop new processes for those materials and scale up. A part of that will be done in parallel, but scale up is another 15 years. For reference, the latest oil refinery (a well known technology) took nearly 13 years to build. You ROFL all you like, but this is reality. And yet, humanity will survive.
We will see.
To be clear: I also think we should put every effort to reduce CO2 emissions. Most people think transportation is the biggest problem; that is actually only 4% of emissions. The big chunk is in raw materials, steel, f.i. is 7% of carbon emission, cement is bigger. Here is a (in my opinion far to optimistic) roadmap for steel by the IEA; halving the CO2 emissions by 2050. I think we need to move quicker, but I don't see any big producers moving. I try to point this out to as many people as possible, maybe something will change. https://www.iea.org/reports/iron-and-steel-technology-roadmap
Indeed. There are always also the political factors out there to blindside you.
ROFL
In the past 20 years we have invested $3.2 trillion on renewables and reduced global consumption of fossil fuels from 82% to 81%. You think the next 20 years will be different? ROFL
I think if the supply chain issues last much longer wrt high end semiconductors, we are going to see significant constraints to growth within the tech sector. We have to watch ASML carefully as they are the only ones on the planet who have the technology to make and service the machines that can etch 5 nanometer line widths. Why is this important? Because every tech company (AAPL, MSFT, IBM, TSLA, etc.) that manufactures a product is not producing these wafers and the integrated circuits themselves but they sure do install them in their phones, cars and computers. ASML has withdrawn their workers from China. Now, China has beaucoup ASML machines yet they do not have the expertise to run and service them. These systems are about the size of a bus. China has a significant number of these "buses" that are now idle.
I'd say MSFT, for the simple reason that it continues to provide so much value to so many people and the product continues to be sharpened up.
MSFT has the scale to purchase competition and integrate it as well.
Tesla.
You are mistaken if you think they are only a car company.
I’m going to be the one who says all 4 of those tech companies you listed stay in the top 10, mainly because I think that those companies have positioned themselves well enough where 18 years isn’t long enough to bring them out of the top 10. (I would write more but I’m writing this way after this article was written anyway).
That being said in 40 years I think all of these companies could struggle to stay high, particularly google and apple.
Almost all of Google’s revenue comes from ads, and I think there’s a world where advertising will start to go more direct to consumer, and skip such heavy reliance on middle men like google. The way they are and will always be able to defend this is through having massive amounts of data, where there status as a middle man also helps optimize the ads you’re putting out, but that’s not something that usually lasts forever.
I also think apples interface isolationism has to come back and bite them at some point, but obviously they have built themselves the most cushion by far.
I think it's Amazon. They are diversifying heavily (consumer goods, grocery, pharmacy, etc.) and they are the uncontested leader in logistics. Not only that but they have the largest enterprise cloud business on the market. As we move to an increasingly digital world, Amazon will continue to bridge the gap between the digital and the physical.
Plus they also have the best selling home smart speaker = huge data mining opportunity on consumers. I think AMZN will be there. Another company that I see in the mix is Tesla. They got the early jump on the e-car market but are also diversified in green energy generation and storage. Tesla is also a leader in AI as applied to robotics.