Sorry to bombard you with videos this afternoon, but you don’t generally gain access to great hedge fund minds like Tepper, Thiel and Hendry. In this excellent Bloomberg interview Peter Thiel discusses why technology will remain the focal point of U.S. economic growth in the coming two decades:
On the current state of the economy:
“Well I think people are too focused on whether we’re in a U shaped recovery, a V shaped recovery, an L shaped recovery – people are too focused on the question on what’s going to happen in the next 6 months. The question for the U.S., Western Europe and the developed world is really what’s going to happens over the next 20 years. Are things going to be better in the next 20 years than they are today? And I think that in long run, the short run becomes the long run. We’re sort of at a point where short run thinking has run out of time in the U.S. So it’s not a question of can patch things up in another year with another stimulus, bail out the banks or anything like that, it’s actually how do you get things in better shape over the next 20 years. The only answer for the develop world is technology and innovation. We can’t compete with China on labor cost, this is not an option. Globalization without technology means just an increasingly Malthusian struggle for resources. So that’s why I think the question about technology is so important and critical for the U.S.”
On why he thinks technology is key for U.S. recovery:
“Technology is a world where it is not a zero sum game and where both sides can win. The U.S. China relationship is becoming an increasingly a zero sum game where it’s very hard to see how both side are benefiting from it and I think that is why you’re seeing a push for protectionism. There are fewer people who believe in free trade. If you had NAFTA come to vote today, it would never passed. Intellectually, I’m very much in favor of free trade but I think that there is something about it where you have to make it work for both sides. Within the tech industry you’ve obviously had Google pull out of China… There is this question about how people can work with China that is still very unclear.”
See the full video here.
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