Did we go from being a service economy to being an industrial and medical-based technology country overnight?
Sometimes when I look at where the unemployment has been concentrated, it's distinctly in service. That's what's not moving. That and experience. Service people are capable of making things great or less cumbersome or at least offer a touch that gives you a chance to do something you couldn't do on your own.
But the hiring? It's totally in technology, meaning the technology that the Labor statistics can't pick up because those are old-fashioned and not by vertical.
More importantly, they are zero sum.
Now we are involved in re-opening and we are seeing some traditional service jobs coming back to life. The mall is actually a little bit abuzz with mall kingpin David Simon talking about green shoots in Florida and Texas malls and giving you stats that show leasing is much better than it has been, not back to 2019 but still positive per contract. We have seen second-tier retail make it back and the first, well, they are some of the best in the market.
But what's really going on, and unfortunately, where the valuations are being stretched, is in the technology of replacement. The biggest winners these last few days are the highest of growth, the companies that replace people who couldn't show up and are alas superfluous when technology can think more quickly and accurately than people and help you know your customer better than you ever could.
This is no longer a "press one to speak with" menu economy. This is the ascendance of customer relations management to the point where Teladoc (TDOC) and Zoom (ZM) and DocuSign (DOCU) are simply better than the hundreds of thousands people who we now view as "friction."
Sure there are instances where there are actually new finserve customers: look at Robinhood and PayPal (PYPL) . There are a spectacular number of companies that empower the small and medium-sized companies to be direct-to-consumer businesses found on Facebook (FB) , Instagram, Pinterest (PINS) , Etsy (ETSY) , powered by Square (SQ) and Wix (WIX) and Shopify (SHOP) . I am talking about millions of jobs created BECAUSE of tech but also because tech wiped out the day job.
Finally we have this whole, gigantic growth phalanx of new businesses devoted to alternative fuels that are thriving BECAUSE of imperatives involving climate change that, with the help of the government or of Amazon (AMZN) and Walmart (WMT) and the like, are recreating the engine. And let's not forget the virus industry. Jobs wanted galore.
It's a peculiar pastiche. One day it will be filled with hope about auto sales and all the millions of people needed to get you a car, until we see that the industry is being disrupted so quickly by vending machine car sales. Another day it will be housing and we see that it's become techno-hungry with the friction being everyone but the buyer and seller. Any tech-related company found itself on the new high list.
Most important, because of Zoom we know that we have to be hybrid home-office and that turned out to be the biggest spur of so much that we are out of semiconductors to meet the demand.
It's in this environment, not the value versus growth faux dichotomy, that we currently play. Oil is value until it's commodity. Vaccines are technology until they are up and running, destroying the stocks of all non-Covid related health care for now.
And finally, there's the SPACs that provide so much money to so many companies that need all of the cloud technology to run smoothly, which is why you can see endless numbers of payments companies and back-office helpers and customer-centric tech and onboarding tech because the new companies are about hiring as many machines and high-value software as possible and cutting out rent, the biggest friction of all save people.
It's an economy that if you look at it as between service and tech you find the trenches, the offensive and defensive lines, with the defense, the old-guard, being overrun. The money that's left is made by the skill player who hangs behind the O-line and the new tech players overrunning the old service dogs all of whom are on the run simply because they are humans and not machines loaded with artificial intelligence, machine learning and a soul directing them to victory.
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