Investments Trade Log

[Henry]

I don't understand NFT's but my thought about them within the context of collectibles is that they will not suffer degradation so there will be no taxonomy of condition. This will remove both the hype and rarity of finding a "mint" NFT in the future similar to finding a "mint" Honus Wagner baseball card.

[giskard]

I don't understand NFT's but my thought about them within the context of collectibles is that they will not suffer degradation so there will be no taxonomy of condition. This will remove both the hype and rarity of finding a "mint" NFT in the future similar to finding a "mint" Honus Wagner baseball card.

I don't believe they are directly analogous to collectors items like baseball cards.

They are more like membership to a club that is in fixed supply and can only be purchased from someone else on the open market. If the club is valuable very few people will want to sell. If they happened to have two they will sell one but retain the last one to preserve membership. Blockchains are of course public so you can show this off as social clout. This feature can drive the prices extremely high into unbelievably parabolic moves.

The successful NFT projects I have observed over the past several years are the ones with cult like followings that can wield the attention of it's members and onlookers, or its founders are doing things to continually drive interest and attention.

They are something else from existing kind of assets that I have seen.

[giskard]

@giskard

As with all currencies and investments you have to have someone once you sell to whom it is more valuable than when you bought, and in this case I just don't see it.

I put my reasoning together in the previous comment but to summarize and re-iterate - because the individual collections are high priced and in small supply and it confers group membership that publicly visible for use as clout this is actually quite reflexive. You can get the biggest parabolic moves on assets of this nature. As long as you don't personally buy into the cult yourself and are willing to sell the top you can profit.

It's my fundamental belief that as a social species ~90% of the value of all assets is social in nature. The more we move online and become a nearly instantly networked species the more opportunity there is to ride these social/financial waves.

This is, imo why you always see bubbles form faster and build higher in asia, since the culture is more collective and communal.

[Seppia]

In other news, BLV sec yield just hit 5% today. With all the overvalued, often money losing stuff going for insane valuations today, I think one could do worse than park their money into the world’s reserve currency long term bonds at yields 2% above inflation.

One underappreciated thing is that due to bond convexity (yes I said it), further 25 basis points moves up will have less of an impact VS what they had back when everybody loved LT bonds at negative real yields