Keen On America Episode 2276: Byrne Hobart on Booms, Bubbles and the End of Stagnation
Dec 18, 2024
Byrne Hobart, an investor and author of The Diff newsletter, dives into the complexities of America's economy, emphasizing the stark contrasts between tech hubs like Austin and stagnant regions. He shares intriguing insights on how economic bubbles, such as the current AI frenzy, can be a pathway to booms, borrowing ideas from economic historian Carlotta Perez. The conversation also touches on the historical lessons of wartime espionage in shaping technological advancements, examining the balance between public and private innovation funding.
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Episode notes
Economic Bubbles as Coordination Mechanisms
Bubbles serve as a coordination mechanism that tells people when to build certain things. They are not just about over-investment but also about creating opportunities that wouldn't exist otherwise.
The Manhattan Project's Wastefulness
The Manhattan Project involved multiple designs and factories to ensure success in creating a nuclear bomb. This approach meant accepting waste as a necessary part of achieving urgent and important outcomes.
Government vs. Private Sector Innovation
Both public and private sectors can achieve great things, but they have different corrective mechanisms. The private sector tends to prune underperforming entities, while the public sector can sustain inefficiencies.
