Sunday Sovereign: NFTs and Cuomo - While One Bubble Inflates, Another Loudly Pops
Told ya So...
Good morning Sovereigns! The frothiness in the market I warned about the prior 3 weeks came home to roost this week with averages and tokens getting shellacked. A combination of higher interest rates, burgeoning inflation, and a new administration that seems at both aimless and keen on regurgitating many of the old failed policies certainly didn’t help. Additionally, markets haven't had a significant retracement since the March 2020 bottom and were due for a bit of a correction.
Actual Video of Biden Administration First 6 Weeks
One beneficiary of the new animal spirits personified by the WallStreetBets/Gamestop fun is the emergence of the NFT asset class as the latest super-speculative hype bubble. For those traditional finance bros still struggling to wrap their arms around Bitcoin (the hardest money ever created backed by the most secure network on the planet), you're really going to have to suspend disbelief to grok the NFT craze.
NFT stands for non-fungible tokens. They allow you to buy and sell ownership of unique digital items and keep track of who owns them using the blockchain. Technically, a NFT can contain anything digital, including drawings, animated GIFs, songs, or items in video games. They can either be one-of-a-kind, like a real-life painting, or one copy of many, like trading cards, but the blockchain keeps track of who has ownership of the file.
We don't have room here for a deep dive but in essence, NFTs are digital tokens that allow you to uniquely identify and trace a work of art or other digital object over time that is not interchangeable with any other item. It's a way to trace provenance and ownership. Bitcoin for example, is a fungible token. Any bitcoin should be tradeable and useable just like any other bitcoin, similar to a dollar bill. NFTs on the other hand, represent a unique digital signature for items that aren't swappable.
It makes perfect sense that as we continue to migrate from an analog to a digital world that technology would need to innovate to find a way to track and identify digital assets. But like the ICO craze in 2017, NFTs and the prices being paid for them are a bit ahead of themselves like any new exponential technology or market in price discovery mode (a friend of mine recently sold a 10 second clip of Donald Trump by artist Beeple, the Picasso of the digital art crowd for $6.6 million, 100x what he paid for it just last October).
Just as I warned in 2017, I believe the overwhelming number of objects and projects being sold at inflated prices will scald the investor left holding this hot potato. However, premium artists and projects will come out of this initial exploratory phase with multibillion dollar new markets, platforms and asset classes, not unlike Ethereum, Cardano, Uniswap and other crypto projects that survived the 2018-2020 bear market.
Here's a fairly comprehensive article that gives a decent overview. Some of it is slightly technical, and may be over the heads of noobs. If you're interested in learning more about crypto in general and other aspects of the digital economy like NFTs, I'm considering putting together a small test group for relative beginners/intermediates that will meet weekly for 30 min for a teaching and ‘ask me anything’ style Zoom. If interested or curious, email me at michael@apextradecraft.com or DM me ‘Crypto’ on Instagram.
Out of respect for my own blood pressure, I'll keep my Cuomo rant short. Cuomo was always a low-IQ, low-ethics, nepotistic fraud aided by a sycophantic press. The fact that he was greeted as a conquering hero and made white woke women swoon is dispositive evidence that truth is manipulatable, and that if a propagandistic media repeats The Big Lie often enough it can become the truth. The MSM established the laughable narrative that Cuomo was our Covid savior, a smart and frank leader that overcame the virus and saved New York. Meanwhile, the obvious fact for anyone willing to look at the data staring them in the face was that NY was literally the Chernobyl of Covid, with the worst results of any State in the United States (actually any state or country in the world).
The national media is based in NY & LA so it's easy to buy into the false narrative when you live in those states that FL Governor DeSantis was a dangerous kook, and Cuomo our lord and savior.
I still get hate mail in my DMs from my New York neighbors when I dare to rebut the above. The reality is, NYC, LA, Chicago and other neurotic, progressive cities run by incompetent, petty dictators are mocked and pitied by the rest of the country. Not only did NY have statistically by far the worst reaction and deaths per capita to the pandemic, they absolutely destroyed small businesses and children's psychology by shutting down schools and businesses (while their 'leaders' sent their own kids to private schools and ate out/traveled when they chose).
Schools still haven’t fully opened in NYC, Chicago, LA or DC. That's why people are leaving these places by the tens of thousands for more sane political climates like TX and FL. And it's not a trickle, it's a flood. We're seeing the largest transfer of wealth in history, not only from centralized sources like banks and pensions to digital & tech entrepreneurs, but from historically great cities like Manhattan to Southern red towns and states. Most 1-percenters are far too intelligent to buy into the "Cuomo did a great job, but Florida is irresponsible" narrative, and yet they did. Perhaps they should examine their cognitive biases that allowed them to be so wrong for so long in this situation and apply what they learned to the other false narratives lingering (ie, masks work).
The irony with Cuomo is that he survived the nursing home massacre without a scratch but is now in hot water with the same fawning, female WhiteWokers for a pattern of sexual harassment claims. In our twisted world, recklessly killing tens of thousands of elderly nursing home residents merits a shrug of the shoulders but sexually harassing a woman is a career death sentence.
Whether Handsy Andy survives or not, the entire situation casts a spotlight on the double standard both in the media and that exists for the elite privileged Democratic class, and the rest of us. New evidence has emerged that Cuomo and his administration actually tampered with the death statistics in the nursing homes.
In a just society, he would have at least been removed from office and likely prosecuted for his gross recklessness in sending Covid patients back to nursing homes, the most vulnerable population. Tens of thousands of elderly New Yorkers died from this decision alone. Tampering with evidence while under investigation is a cherry on top and lends credence to my opinion that he should spend the rest of his life in prison.
Any CEO or employee of any corporation would be summarily fired and prosecuted for the same. Elizabeth Holmes of Theranos fame is facing a lengthy jail sentence and there are thousands of people rotting in our system already for doing a fraction of the above. If a young black man can get a 20 year sentence for being a lookout on the corner in the drug game, then Cuomo should at least be on deck for a multi-year Federal Vacation.
Here’s what I’m reading & watching this week….
Articles I’m Reading…
*More color on NFTs from one of the world's top technologists and venture Capitalists.
*Chamath Walks on Water Is there anything he can’t do??
*Learning from cultural revolutions, and their relation to today.
*Using MDMA and Psilocybin to treat mental illness ranging from PTSD to Depression.
*“Shocking” report that links obesity to Covid deaths. Note that Fauci and the other frauds never once told you to eat right, exercise, get some sunshine and supplement properly. Just put a t-shirt on your face and social distance….Well it turns out obese populations accounted for 90% of the deaths.
*"Pumping Iron" is indicted BitMex founder Arthur Hayes' treatise on inflation and why the perfect portfolio is long crypto + long interest rates. Grab a drank and snuggle in, for mentally stimulating discussion on the end of the Bretton Woods / Petrodollar regime. Highly recommend for finance folk.
*Boston Dynamics teamed up with NYPD to use robo-dog for first time in active crime scene. Spot, the robo-dog, can follow routes and adapt to all types of terrain while carrying up to 30lbs.
*Where we are in the cycle of order and disorder. Ray Dalio on how we behave and the systems that try to tell us how to behave.
*Goldman Sachs brings back bitcoin trading desk and eyes a bitcoin ETF: Global investment bank Goldman Sachs has brought back its bitcoin trading desk and will start handling bitcoin futures in the coming week. The firm is also reportedly exploring the potential for a bitcoin exchange-traded fund (ETF) and plans to provide a crypto custody service.
*Has the increase in wealth really made the US happier? Don’t smile in public, because that’s weird. Don’t be too friendly, that comes across weird too.
*Burning a Banksy art piece after turning it into an NFT. Now, it can only be owned online. Dr. Seuss Foundation should explore this…
*Alex Gladstein looks at every trad finance bros favorite question - can governments stop bitcoin?
*Citi thinks BTC is either going to become the world’s reserve currency - or implode.
*Obama and Springsteen turn podcast hosts in ‘Renegades: Born in the USA’. We listened to it so you don't have to... - Topics ranging from race issues to political.
Videos I’m Watching…
Great Roundtable with JML, Darren Beattie, Will Chamberlain and Dave Reaboi
Video between Bitcoin GigChads Michael Saylor and Ross Stevens. Good dive for beginners and intermediates.
Late Night has been unwatchable for more than a decade, but at least Jimmy Fallon is funny/talented. Trevor Noah on the other hand - has he said a single funny thing in his entire life? First 5 minutes is enough to watch here...
Podcasts I’m Listening To…
How to Focus to Change Your Brain. Masterclass on neuroplasticity by Dr. Andrew Huberman of the Stanford Lab.
Twitter Octagon
Parting Words…
"Everybody wants to be a beast, but don’t nobody want to lift some heavy ass weights." - Ronnie "Light weight baby" Coleman
"The harvest is plentiful, but the workers are few." - Luke
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