Flight to, er, No Returns?

When I took the job at TechTicker, I had no idea a massive credit and banking crisis would become the dominant story of the markets. As I wrote before, it makes me feel a tad irrelevant as someone who focuses on tech companies and startup culture. But the plus is it's forced me to stay very engaged in the news flow of this crisis, and re-engage with my finance reporter roots.

Fun fact: I actually started my career covering finance. The reason I don't have a Southern accent? I used to get mocked when I called Wall Street and said things like, "What do y'all think about this market?" Good times.

Anyway, during the last downturn I talked to experts over and over again who talked about a flight to quality-- ie focusing tech holdings on the big, safe tech names-- as the way to survive the turbulence. Similarly, I have CNBC on in the green room all day and all I hear is that same advice. OK, so let's see how you did if you took it: According to this chart you would have lost money on nearly every name.

Now, I KNOW, people will say ten years isn't long-term enough. Tell that to someone who was ten years away from retirement in 1999, first of all. Also, that should be considered long-term in technology, shouldn't it? It reminds me of something Peter Thiel once told me that flicks to the cultural difference between Silicon Valley and Wall Street: A bet on, say, Microsoft isn't actually a technology play. Because Microsoft wants things to stay the same. It's actually a vote against innovation.

What if instead of keeping the bet on Yahoo ten years ago as the experts told you to, you bought Google at the IPO? Or instead of SAP, you went with Salesforce? Young risky companies, yes. But, per Peter's point, it seems that's a wiser bet if you're a believer in the fundamentals of tech, because the fundamentals of tech involve change and disruption. Very few companies can stay on top of multiple market and technological shifts. Investors should think long and hard about that conventional wisdom this time around.