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The poor returns on CDs and bonds are powering the tech and many other sectors by forcing money into investments rather than loans. This allows firms to work with equity which is far more likely to drive start ups and new ventures for existing companies. By pushing up eq1utie prices, it also makes borrowing and issuing bonds far cheaper because of increased credit ratings. It also drives up the value of dividend paying stocks for the returns are often times double that of CDs and bonds. Hopefully this has reached a critical mass and won't repeat the dot com bust. This has brought about a fundamental change, accelerating the breadth and depth of the current tech boom and knowledge explosion. Tech has now become a fundamental factor in almost everything we touch. There is hardly an area that isn't now touched by bleeding edge tech and applications. Even washing machines and detergents have bleeding edge tech in the chemistry, sensors and adaptable programing based on load, dirt, weight and water temperature. Now, even a washing machine is smart and getting smarter. Coatings on everything have become a field that resembles rocket science. No one can predict where we will be in just ten years and the interactions with politics and society. Increasing life spans, brought about by fast moving medical tech, will wreak havoc with almost every assumption we have made about fairness, politics, education and finance.
One major impact is those traditional large multi-national companies might not have the same influence or even the advantage in the new era. IBM is struggling for a new life, Microsoft is trying to prove they found new meaningful directions, Motorola, Nokia, Lucent, Blackberry and many other all have shrunk, split, or been acquired by someone else. In the semiconductor industry, I think one major change will happen at Intel. Either they can reinvent themselves or they will have to spin off some of their businesses to become more focus and nimble.
Intel relied on the Wintel monopoly that is coming to a slow end. Cell phones are less and less about being a phone and more about being a computer plugged into the web. Docking will present an even more serious threat as the mobile computer/phone becomes everything, alarm clock, entertainment library, reader, remote, home automation interface, auto interface and hundreds of more functions, some for devices and functions that don't even exist yet. Intel and Microsoft got comfortable, rich and lazy and like many others, the rest of the world caught up and passed them. They face formidable odds, but can stay relevant with proper management, the question is do they have management up to the task? So far the answer is no and contra revenue is just a sad symbol of failure as is the Microsoft phone.
No net job creation though. The oil boom created jobs; tech has eroded most everything else.
My theory: Anything fluid (oil, coffee, coatings, soap, hydrogen) is part of a job-creating eco-system. Anything electronic or software-driven is job-destroying. Based on this theory, Tesla will be net job-destroying while the fuel-cell, hydrogen car industry will be job-creating.
benb, jobs are always being destroyed by technology and have been since the dawn of man, but this frees up people to do other more productive pursuits. Agriculture used to employ most of the population, now very little in modern countries. There is lots of work and it always changes in form, the process is just so much faster. Education mostly controlled by government and government regulation are largely holding us back for government employees live in a time warp of the past with a work environment fixed in a slow moving past of life time jobs, benefits, pensions all totally disconnected from performance, reality or results. We need to change and our government needs to change with us or we will suffer the fate of many empires before us that didn't adapt, FAILURE, COLLAPSE AND IRRELEVENCE.
benb, Singapore is an ideal example of good government with very good government with very, very rare honest accounting. Our accounting sadly is a combination of Bernie Madoff and Enron style accounting for which we someday pay dearly.
Personally I think it won't need a sudden big change; the server and cloud infrastructure business of Intel will keep on funding the trials in mobile, wearable and foundry services and lead to (baby) steps in the right direction. In a few years time people will realize Intel is actually a foundry player and a player in the wireless/mobile/wearable world.
This is under the assumption 64 bit ARMs won't take a considerable part of the server and cloud infrastructure market. If that would happen I agree with your scenario.
