Crypto Conversation

[Jeffrey]

Well the 100x doesn’t happen right away. But art by artists who have passed often will increase in value by 100x over a decade or two or three (see Warhol).

Where did you acquire this bogus belief? If true, then art would be a great investment and there would be many, many more art investors!

Do you truly believe 1 in 1,000,000 (see Warhol) is often?

What percentage of living artists works, adjusted for inflation, will sell for more (not 100x, but merely 2x), “a decade or two or three” after they pass away?

[Jeffrey]

IOW the instantaneous value of a stock is more determined by expectations of future crowd behavior than by the actual intrinsic value of the company, current or predicted.

Strongly disagree! Accurately predicting future company earnings is easier than accurately predicting future human behavior.

[OldPhiKap]

Oh, I agree with most of this, including the cult like beliefs of many of its adherents. I was just pushing back against the notion that the prices of most real world investments are primarily based on utilitarian intrinsic value. Even stock prices aren’t primarily based on fundamentals - P/E ratios can vary by orders of magnitude over time just based on crowd group-think. See Tesla.

Agreed. “Potential” has value too, and the likelihood of success or failure impacts capitalization rates and other valuations.

[Skydog]

Where did you acquire this bogus belief? If true, then art would be a great investment and there would be many, many more art investors!

Do you truly believe 1 in 1,000,000 (see Warhol) is often?

What percentage of living artists works, adjusted for inflation, will sell for more (not 100x, but merely 2x), “a decade or two or three” after they pass away?

A very low % of art in general, but most art is bought for decoration, not as an investment. But the performance of a high % of the estimated 1.6 trillion dollars of art investments by high wealth individuals is driven by market forces - not by “intrinsic value of beauty.”

I don’t even understand why this is controversial. Do you really think the Warhol screenprint of Marilyn Monroe has an “intrinsic beauty” value of $195 million? Because that is what it sold for last July.

[Jeffrey]

I don’t even understand why this is controversial.

I’ve spent considerable time, energy, and money learning about and investing in art. Many of my closest friends are artists. You’ve made many inaccurate statements. Trust me, I wish they were accurate statements because incredible wealth would be in my future.

[Skydog]

I’ve spent considerable time, energy, and money learning about and investing in art. Many of my closest friends are artists. You’ve made many inaccurate statements. Trust me, I wish they were accurate statements because incredible wealth would be in my future.

In the specific post you are replying to what is incorrect?

[Jeffrey]

In the specific post you are replying to what is incorrect?

Your anticipated returns which are similar to many crypto investor’s expectations.

“An artist dies and suddenly his art pieces go up in value 10-fold, 100-fold or maybe a 1000-fold if a buying frenzy starts. If beauty was the determining factor the artists works would have been just as valuable when he was alive.”

“Well the 100x doesn’t happen right away. But art by artists who have passed often will increase in value by 100x over a decade or two or three (see Warhol).”

[JasonEvans]

Back on topic, crypto lender Genesis has filed for bankruptcy: https://www.cnbc.com/2023/01/20/cryp...ncy-group.html

The company listed over 100,000 creditors in a “mega” bankruptcy filing, with aggregate liabilities ranging from $1.2 billion to $11 billion dollars, according to bankruptcy documents.

It appears this one is gonna hit the Winklevoss twins pretty hard too. Among the creditors is Gemini, a fund that was founded by the Winklevi... Genesis owes Gemini over $750 million.

[PackMan97]

Your anticipated returns which are similar to many crypto investor’s expectations.

“An artist dies and suddenly his art pieces go up in value 10-fold, 100-fold or maybe a 1000-fold if a buying frenzy starts. If beauty was the determining factor the artists works would have been just as valuable when he was alive.”

“Well the 100x doesn’t happen right away. But art by artists who have passed often will increase in value by 100x over a decade or two or three (see Warhol).”

It is worth noting that when an artist dies the supply of their art becomes fixed which can cause the price to increase,particularly if they had many productive years ahead of them.

[MChambers]

Back on topic, crypto lender Genesis has filed for bankruptcy: https://www.cnbc.com/2023/01/20/cryp...ncy-group.html

It appears this one is gonna hit the Winklevoss twins pretty hard too. Among the creditors is Gemini, a fund that was founded by the Winklevi... Genesis owes Gemini over $750 million.

Beyond the bankruptcy of Genesis, the bigger issue is that the SEC has filed a complaint charging both Genesis and Gemini for the unregistered offer and sale of securities. https://www.sec.gov/news/press-release/2023-7

If the SEC is right, and I think they probably are, all US investors who bought in the offering have a right of rescission, meaning they can get their money back from whichever of Genesis and Gemini has assets.

[Jeffrey]

It is worth noting that when an artist dies the supply of their art becomes fixed which can cause the price to increase,particularly if they had many productive years ahead of them.

After an artist passes away, their primary market soon closes. Then the incentive for primary market sellers to maintain prices in the secondary market evaporates. Most artist’s works fall in value, after their passing, without secondary market price manipulation.

[MChambers]

tldr vers - The value of all assets is some weighted combination of intrinsic real value (a ton of wheat will feed hundreds) and perception-driven value (beanie babies value is all in the minds of the public). And most assets get their assessed value much more from the latter than the former. And the value of crypto — like a rare stamp or a million dollar single digit license plate in Saudi Arabia — happens to arise entirely from the latter.

As to stocks, Benjamin Graham apparently said: “In the short-run, the market is a voting machine — reflecting a voter-registration test that requires only money, not intelligence or emotional stability — but in the long-run, the market is a weighing machine.”

https://quoteinvestigator.com/2020/01/09/market/

Sooner or later, this will apply to crypto assets. Seems like it is starting to apply now.

[budwom]

https://www.nytimes.com/2023/01/20/o...inflation.html

I know it's behind a paywall, but Paul Krugman's piece on crypto (and gold) is a keeper...entertaining and insightful.

[camion]

https://www.nytimes.com/2023/01/20/o...inflation.html

I know it's behind a paywall, but Paul Krugman's piece on crypto (and gold) is a keeper...entertaining and insightful.

Is this a free version?

Linky

[budwom]

Is this a free version?

Linky

yes it is, well done.

[OldPhiKap]

https://www.nytimes.com/2023/01/20/o...inflation.html

I know it's behind a paywall, but Paul Krugman's piece on crypto (and gold) is a keeper...entertaining and insightful.

“Libertarian derp”

That’s what I was trying to express in my description of what backstops crypto. Had not seen that before but spot on.

[budwom]

“Libertarian derp”

That’s what I was trying to express in my description of what backstops crypto. Had not seen that before but spot on.

Ya know, I was going to mention that marvelous phrase, but thought I might catch a ding from the authorities. Glad you did it!

[fidel]

Ya know, I was going to mention that marvelous phrase, but thought I might catch a ding from the authorities. Glad you did it!

‘OPK effect’

[budwom]

‘OPK effect’

It pays to have friends in high places!

[Phredd3]

It pays to have friends in high places!

Well, he is a Dead Head, so I guess, yes?