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What’s Behind All Those Tech Layoffs? A New Economic Reality – The New York Times

“High rates are painful for almost everyone, but they are particularly painful for Silicon Valley,” said Kairong Xiao, an associate professor of finance at Columbia Business School. “I expect more layoffs and investment cuts unless the Fed reverses its tightening.”

At the moment, there is little likelihood of that. The market expects two more rate increases by the Federal Reserve this year, to at least 5 percent.

In real estate, that is trouble for anyone expecting a quick recovery. Low rates not only pushed up house prices but also made it irresistible for companies such as Zillow as well as Redfin, Opendoor Technologies and others, to get into a business that used to be considered slightly disreputable: flipping houses.

In 2019, Zillow estimated it would soon have revenue of $20 billion from selling 5,000 houses a month. That thrilled investors, who pushed the publicly traded Seattle company to a $45 billion valuation and created a hiring boom that raised the number of employees to 8,000.

Zillow’s notion was to use artificial intelligence software to make a chaotic real estate market more efficient, predictable and profitable. This was the sort of innovation that the venture capitalist Marc Andreessen talked about in 2011 when he said digital insurgents would take over entire industries. “Software is eating the world,” he wrote.

In June 2021, Zillow owned 50 homes in California’s capital, Sacramento. Five months later, it had 400. One was an unremarkable four-bedroom, three-bath house in the northwest corner of the city. Built in 2001, it is convenient to several parks and the airport. Zillow paid $700,000 for it.

Zillow put the house on the market for months, but no one wanted it, even at $625,000. Last fall, after it had unceremoniously exited the flipping market, Zillow unloaded the house for $355,000. Low rates had made it seem possible that Zillow could shoot for the moon, but even they could not make it a success.

Source: https://news.google.com/__i/rss/rd/articles/CBMiTmh0dHBzOi8vd3d3Lm55dGltZXMuY29tLzIwMjMvMDEvMjMvdGVjaG5vbG9neS90ZWNoLWludGVyZXN0LXJhdGVzLWxheW9mZnMuaHRtbNIBUmh0dHBzOi8vd3d3Lm55dGltZXMuY29tLzIwMjMvMDEvMjMvdGVjaG5vbG9neS90ZWNoLWludGVyZXN0LXJhdGVzLWxheW9mZnMuYW1wLmh0bWw?oc=5

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U.S. Courts India as Technology Partner to Counter China – The New York Times

Officials from the United States and India agreed on Tuesday to expand cooperation on advanced weaponry, supercomputing, semiconductors and other high-tech fields, as the Biden administration looks to strengthen its connections with Asian allies and offset China’s dominance of cutting-edge technologies.

The agreements followed two days of high-level meetings in Washington between government officials and executives from dozens of companies, the first under a new dialogue about critical and emerging technologies that President Biden and India’s prime minister, Narendra Modi, announced in Tokyo in May.

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US blocks export license renewals for China’s Huawei – The Associated Press – en Español

BEIJING (AP) — China’s government accused Washington on Tuesday of pursuing “technology hegemony,” as the United States has begun stepping up pressure on tech giant Huawei by blocking access to American suppliers.

The Biden administration has stopped approving renewal of licenses to some U.S. companies that have been selling essential components to the Chinese company, according to two people familiar with the matter. Neither was authorized to comment publicly on the sensitive matter and they spoke on the condition of anonymity.

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