Assets are Energy
What Price For Security?
We need more assets. That was my conclusion the other day. Well, one that I had brazenly stolen from Hugh Hendry after watching him on Real Vision. We need better assets, too. This is especially true here in Australia, which has been an expert in building shoddy, overpriced 'investments' for at least 30 years. So where to turn, folks? First, let us think about the definition of an asset. It is something beyond the dry, technical explanations offered in the dictionary. Sure, it is something you own; like a parcel of land or share in a business. But it is oh so much more than that. An asset is an anchor. An asset offers some security for your accrued time, effort and attention. An asset, my friends, is fucking important.
So when I look at the current landscape, I scratch my head and wonder. I'm frequently confused by current house prices. It is partly a reflection of monetary distortion, partly the demand from established custom (better to pay a mortgage than a landlord!). And most importantly, we all need a roof over our head. But I'm still shocked at just how much accrued time, effort and attention folks are willing to exchange for (heavily regulated) property rights to a teeny-totty house or flammable apartment. And those rights are at the mercy of our favourite, friendly banks. You give up optionality, too. Resource for a fledgling business, a large family or generally pleasant lifestyle is sacrificed at the alter of housing investment. It is a tragic, and frankly criminal, result.
Don't despair, however. Quite the opposite actually. If I had the luxury of choosing which era to be living in, it would still be right now. 100%. Consider this; whilst there is a real estate and FAANG stock frenzy going on, there is also a (relatively) quieter revolution taking place in the background. And I don't just mean Bitcoin! or Crypto! (although those fellas play a huge part in the story). Look carefully and you can bear witness to the creation of a new digital frontier. Where there are virtual plots emerging for eager settlers. And as I covered earlier in Highway to the Metaverse, we can acquire property rights (and thus assets) through code.
Mix it All Together
Now I appreciate this is early days. Super early days. I hardly expect a rush of homeowners ditching real estate for digi-homesteads in a virtual wild west. Not in the next 5 years at least. But look past the current noise in this space (China! Death Cross! Elon!). Pay attention to the generational shift that is taking place. Scepticism of digital value generally comes from those more used to handling vinyl records and paper documents. You can at least feel bricks and mortar, no? But for anybody born after the late 1980s, the virtual experience is as important as the real one. Perhaps more so for some folks (gamers, coders, publishers etc.). There is increasingly little distinction between physical and digital. In the 21st century - and this may require a leap of faith - assets are simply a manifestation of energy.
Assets are proof of accrued work. Of time. Of effort. Of attention. To me, that is what Bitcoin's true calling is; verifiable ownership of energy. That is why I am so god damn motivated to acquire it. But assets must offer so much more than a mere storage facility (much like a house, bond or stock offers a yield - albeit a diminishing one). That is why I also find myself drawn to Ethereum; where we can draw up smart contracts and create aesthetic experiences demonstrating our creativity. If you are not quite following me folks, I totally get that. Not everyone has the desire to build and design. But I do get awfully excited on these meandering tangents. There is something in this line of thought. I can feel it stirring within me.
So expect to hear more musings on this theme, my friends. More assets are on the way folks. Better assets.
Signing out, Steven.
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