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Revealed: 277-year-old asset class booms thanks to NFTs

Recently, the ultra-rich spent more than $2.6 billion on this 277-year old asset in just 2 weeks.
The post Revealed: 277-year-old asset class booms thanks to NFTs appeared first on CryptoSlate.

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Recently, the ultra-rich spent more than $2.6 billion on this 277-year old asset in just 2 weeks.

Why? Because while most investors are focused on the NFT craze, little did they realize there is an estimated $1.7 trillion market gaining popularity because of the mania. 

In fact, the WSJ called it  “among the hottest markets on earth.” And the ultra-rich is helping to drive this market to record levels:

The Rothschild family sold this amazing asset for over $197 million to the Dutch government. 

Oprah Winfrey sold this asset for $150 million (grossing $62 million for herself).

Jeff Bezos recently sold Amazon stock to buy $70 million worth of this asset. 

Bill Gates keeps $124 million of this asset locked away in his personal mansion. 

And Steve Cohen, legendary hedge fund manager, spent more than $1 billion.

What is this alternative asset? Art. Not digital art like an NFT, but physical masterpieces by famous artists such as Picasso, Monet, Basquiat, Banksy, and Warhol. 

There might be a few reasons why the ultra-rich have invested in this asset: 

  • Contemporary Art price appreciation has outpaced the S&P 500 by almost 3 fold from 1995 to 2020.
  • In periods of inflation equal to or higher than 3.0% (now it’s double that), contemporary art grew 23.2% on average and outpaced most other alternative assets (such as real estate and gold).   
  • In 2020 amid the pandemic, art outpaced 10 major asset classes according to Citi, many of which have been considered conventional “safety hedges.” 

What makes this asset so attractive? 

As a  BBC article stated recently, “art has no correlation to the stock market, paintings can go up in value even when the market crashes.” 

Unfortunately, most people simply can’t afford to invest in a $100,000,000 Picasso. 

But there is an alternative. A groundbreaking $1 billion app makes it possible to own investments in similar great artworks by famous artists such as Picasso, Basquiat, and Soulages… without the need to invest huge amounts of money. 

What is the $1 Billion App?

Masterworks.io is a $1 billion art investment startup that allows everyday investors to buy contemporary art. And for just a fraction of the cost of an entire painting.

It provides everyday investors access to some of the same types of paintings collected by wealthy collectors like Jeff Bezos, Bill Gates, and Eric Schmidt. 

Every day investors choose Masterworks.io because it allows them to invest in shares representing investments in artworks without spending millions of dollars. 

It gives you the chance to invest in a Banksy or Condo painting for as little as $20. And with 295,000 users on the Masterworks.io platform, it’s become very popular.

Why Use This App Now? 

According to Citi, art prices have outpaced other asset classes such as equities, cash, real estate, and certain commodities during the pandemic. 

That’s because contemporary art has a low average correlation to other major asset classes. 

For investors who wish to invest in an alternative asset when the market seems uncertain due to the recent crisis, now they can do so through Masterworks.io.

Investors can choose to invest in artworks from artists like Pablo Picasso, Zao Wou-Ki, and Gerhard Richter on the platform. 

However, once certain goals are reached for each artwork, investors won’t have a chance to invest anymore. 

For instance, recently, a new Banksy artwork called “Exit Through the Gift Shop” was sold out in less than three hours on the Masterworks.io app.

How Does Masterworks.io App Work?

In 2017, CEO Scott Lynn aimed to democratize the art market by securitizing the first painting, Andy Warhol’s ‘1 Colored Marilyn (Reversal Series). 

He said “That light bulb kind of turned on four years ago, and it just occurred to me that this is probably the largest asset class that’s never been securitized.”

Masterworks.io has since evolved into having a large collection of famous physical artworks for investors to invest in. 

This is how it works: 

  1. The Masterworks.io research team analyzes over 60,000 data points across 70+ years to discover which types of work have attractive price appreciation potential.
  2. Masterworks.io purchases and securitizes the artwork, and then makes it available to investors on the Masterworks.io app.
  3. You can list your investments in the artworks to other users on the platform. 
  4. You can hold onto your investments in the artwork and participate in the distribution when Masterworks sells it.

Price Appreciation From Famous Artworks

In 2020, Masterworks’ investors saw a 32% annualized appreciation, from the sale of their Banksy painting “Mona Lisa”, net of fees. 

And in 2021, investors are set to receive a 31% annualized appreciation from the sale of their George Condo painting “Staring Into Space”, net of fees. 

That’s why Kevin O’Leary from Shark Tank tweeted: “ANYBODY can invest in art by names like Banksy, and I love what they’re (Masterworks is) doing.” 

How to buy the “billionaire asset” in just a few clicks?

You only need to follow three steps to get started:

  1. Go to the Masterworks’ signup page.
  2. Enter your contact information and answer some questions.
  3. An art investment representative will contact you and help you.

See important disclosures at masterworks.io/disclaimer  

The post Revealed: 277-year-old asset class booms thanks to NFTs appeared first on CryptoSlate.

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Buy the Deep Value in Boeing Stock or Pass Due to Ongoing Issues?

Boeing is moving lower on earnings, disappointing the bulls. Here’s what the charts look like now.

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Boeing is moving lower on earnings, disappointing the bulls. Here's what the charts look like now.

Boeing BA remains a red-hot debate even as we're on the verge of it being two years since the start of the Covid-19 pandemic, at least in the U.S.

The airlines have been crushed, as have travel trends. And thus, it’s no surprise that Boeing has been hit hard too.

Despite the booming Covid case count due to the omicron variant, the airline stocks actually held up pretty well until recently.

Boeing stock was also trading pretty well, but it’s now working on its seventh straight lower close. At this week’s low, the stock was down over 16% from last week’s high.

Bears will argue that it will be years before the global travel trends return to normal and even longer before the airlines are in a position to start placing significant orders for new jets.

Bulls will argue that we’re well past the trough of the pandemic, as well as the travel-crushing consequences. As a result, Boeing stock is a great value near current levels, particularly given that it runs a near duopoly on the industry (along with Airbus).

That said, the company did book a massive loss in the most recent quarter, which is rubbing investors the wrong way today, and with good reason.

Trading Boeing Stock

Weekly chart of Boeing stock.

Chart courtesy of TrendSpider.com

You’ll notice that even before this latest spill, Boeing stock has struggled with the 50-week moving average, as well as the $230 area.

That’s been the case for months and in fact, really for all of the fourth quarter.

Breaking below the $205 to $207 area, investors find Boeing stock below the 10-week, 21-week and 50-week moving averages. The stock is also below the $200 level.

That leaves the stock in an interesting area, as Boeing struggles to find its footing.

If Boeing can reclaim $200, then the $205-ish area will be back on watch, but it’s really the 10-week and 21-week moving averages that it needs to reclaim.

Below those marks and the trend remains unfavorable for the bulls. Above them could put the 50-week moving average and $225 back in play.

On the downside, there was clear support in the mid-$180s, while the December low sits down at $185.26.

Can bulls get an undercut of this area and some sort of reversal to the upside?

That would be one potential outcome, at least on the downside. Another would be for a larger decline, potentially down toward the $158.50 gap-fill level.

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Economics

Oil Could Be The Haven Stocks Traders Need To Shelter From Fed

Oil Could Be The Haven Stocks Traders Need To Shelter From Fed

By Nour Al Ali, Bloomberg Markets Live commentator and analyst

Oil is starting to look like an unlikely haven from the stocks selloff in the run-up to anticipated Fed tightening.

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Oil Could Be The Haven Stocks Traders Need To Shelter From Fed

By Nour Al Ali, Bloomberg Markets Live commentator and analyst

Oil is starting to look like an unlikely haven from the stocks selloff in the run-up to anticipated Fed tightening.

Traders are pricing lower volatility in the commodity than in the Nasdaq and S&P 500. Barometers of market anxiety for both indexes have shot up recently, suggesting trader sentiment is souring. Meanwhile, the CBOE Crude Oil Volatility Index, which measures the market’s expectation of 30-day volatility of crude oil prices applying the VIX methodology to USO options, shows that oil prices are expected to remain relatively muted in comparison.

With a producer cartel to support prices, the outlook for oil is more sanguine, even if the Fed raises rates. The commodity has ample support, with global oil demand expected to reach pre-pandemic levels by the end of this year. The U.S. administration has been pushing oil-producing nations under the OPEC+ cartel to ramp up output, while the group has stuck to a modest production-increase plan and is expected to rubber-stamp another 400k b/d output hike when they meet next week. This means that oil is likely to stay a lot more stable than in recent years.

The relatively low correlation between the asset classes provide diversification benefits. The relationship between the S&P 500 and the global oil benchmark is weak and lacks conviction; it’s even weaker between the Nasdaq 100 and Brent crude contracts. The divergence in price action this week could indicate that stocks have been tumbling in fear of a hawkish Feb, more so than geopolitical risk alone. That would perhaps offer traders an opportunity to seek shelter amid stock volatility in anticipation of the Fed’s next move.

Oil might have tracked the decline in stocks at the beginning of this week, but the commodity is back to its highs now. It’s up close to 15% this year, while the S&P 500 is struggling to reclaim its footing after plunging as much as 10%.

Tyler Durden Wed, 01/26/2022 - 13:45

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Who’s Afraid Of Jerome Powell?

Who’s Afraid Of Jerome Powell?

Authored by Tom Luongo via Gold, Goats, ‘n Guns blog,

baller (ˈbɔːlə)
n
slang someone, usually a man, who lives in an extravagant and materialistic manner, tending to be something of a socialite

My wife…

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Who's Afraid Of Jerome Powell?

Authored by Tom Luongo via Gold, Goats, 'n Guns blog,

baller (ˈbɔːlə)
n
slang someone, usually a man, who lives in an extravagant and materialistic manner, tending to be something of a socialite

My wife and I got sucked into watching the Dwayne Johnson series Ballers on HBOMax over the weekend. Aside from being hilarious, it struck me how much of a microcosm of our world this seemingly alien world of twentysomething millionaires and rapacious billionaires really is.

When you drill into the details, the world of Ballers really isn’t that far from ours.

For those that don’t know the setup, broke former NFL bad boy Johnson is trying to turn a new leaf “monetizing his friendships” to help NFL players hold onto all that money they are making at an age when they have zero ability to contemplate their own mortality.

One storyline from the first season is especially relevant. A kid with a good heart, Vernon, banking on his next big contract, is out of money having spent it all on being ‘loyal’ to his friends and family, throwing parties, inviting 40 people to a business lunch, etc.

His loyalty is so out of control he has to borrow money from Johnson (who’s broke mind you) to bridge him until the contract comes through. Of course there are complications and hilarity ensues. The typical Hollywood fantasy fare. Nothing groundbreaking, eventually things work out (mostly).

Johnson has to endure a lot to get Vernon to see the truth, put limits on the situation and get Vernon to properly save his money. The pitch is the right one: put it to work and pay everyone for the long term, not just for tomorrow.

Sound familiar?

No, because that’s exactly what we don’t preach in this world of central bank issued easy money. This shouldn’t be a central conflict, it should be a given.

Because this background for this story is playing out at every level of our society, all a consequence of too much money flowing around finding ways to corrupt everything it touches.

Ballers is all about the corruption money brings to those few thousand people in the NFL and their organizations because of the millions of people who spend too much money on a passing fancy, entertainment.

The NFL, like all pro sports, is nothing but a money funnel with a Federal Reserve sized Hoover attached to it. It’s the ultimate corruption of e pluribus unum. From many to one.

Take a little bit from all of us, time and again to help us relieve the stress of the shitty world they’ve built. Give some of it to the rubes who play the game, who blow it on hookers, high end cars, and drugs, while the lion’s share gets sucked right back up into the same oligarch class that created it in the first place.

But it’s no different than you or me, buying shit we don’t need on credit, self-medicating with pro sports, alcohol, video games, day-trading cryptos on Robinhood, yelling at racists on Twitter or my personal favorite, a ridiculous board game collection.

We’re all ballers to one degree or another, spending easy money on distractions rather than facing the reality that the most unsustainable thing about our society is the money which makes it all happen.

And before anyone revokes my libertarian creds, I pass no judgment on this. It’s all voluntary exchange, mostly. At the very least it has the appearance of being voluntary.

That said, here we are waiting to hear from the philosopher kings at the FOMC and the markets are melting down around our ears.

The tantrums that have begun are no different than those pitched by Vernon’s friends over having the barest amount of fiscal discipline imposed on them.

Everywhere I look everyone is saying some version of the same thing, “Hey man, Don’t take the punch bowl away.” They’d say it a lot more colorfully on Ballers, but being white I’m not allowed to use that language.

From Chairman Xi leading off this year’s virtual Davos with a plea not to hike rates to the howls from the Financial press including some Austrians, pleading that he can’t possibly raise rates because it would cause a market meltdown and blow out the Federal budget, Powell is now off everyone’s invite list to party on the yacht.

I get the feeling that some folks would rather be right about their hyperinflation theories rather than actually figuring out what’s really going on.

But the reality is that something has changed and the markets are finally coming to that conclusion.

For months I’ve been arguing that Jerome Powell ignited a firestorm when he raised the Reverse Repo Rate by 0.05%, pulling trillions in base liquidity from overseas markets while handing U.S. banks all the collateral they needed.

It’s created a political firestorm on Capitol Hill who tried to oust him from the Chair and failed. They got three of his fellow hawks, but not the king. He was able to run out the political clock on both Build Back Better and opposition to his reappointment.

But it doesn’t happen if Powell doesn’t have the backing of the people behind him.

And who backs Powell? The New York Fed, that’s who.

That leads you to the conclusion that all is not hunky dory in Oligarchville. That, shock of shocks, narcissists only like each other when they are sucking our lives and souls away. But when they start taking from each other, that’s when the knives come out.

It seems incredible to me that many people won’t consider this idea, that these people don’t like each other, and aren’t willing to hand over their business and their wealth without a fight?

Because that’s what’s implied when everyone jumps up and down and screams at Powell to “Save them!” from deflationary forces.

And he looks down from the Marriner-Eccles building and says, “No.”

It’s time to put it all in order. With ‘Build Back Better’ dead there is no more insane new spending to monetize. There is no reason for the Fed to keep up QE or rates at the zero-bound. Savings is down, money is circulating again. Inflation isn’t transitory.

People want to work. COVID-9/11 is behind us. The anger over losing two years is just getting started but that’s a different wrinkle to this story for another day.

If the Fed isn’t intimidated by the recent weakness in stocks, in truth a healthy correction after a massive run, and raises rates on Wednesday we have our answer as to what Powell and friends are willing to do. Whatever your opinion of it is, it will not be a ‘policy error’ but a clear-eyed understanding that it’s time to rein it in, change the direction of the big boat, and begin living within our means.

If he doesn’t it won’t be the opposite signal. It will simply mean that they’ll take another couple of months to nail down the particulars, namely getting proper control over the O’Biden administration, and begin hiking on schedule per the current expectations in the Eurodollar futures market.

Has anyone looked at the ratings for pro sports? Old media? Hollywood box office receipts? All down. Netflix is getting killed because it’s growth cannot sustain its valuation, much like a lot of the NASDAQ. This is something that should have happened two or three years ago, just like Tesla.

But didn’t because of COVID-19 and the massive wealth transfer the stimulus provided to them during the absence of sanity oceans of money always produces.

That said, these are all unsustainable Ponzi scheme masquerading as viable industries based on cheap money and malinvestment in politically-motivated production.

Now I’m not suggesting for a second that Powell is some kind of saint or anything. He’s no savior sent down to redeem us sinful ballers from our excesses. No sir. He represents the very people that helped create this mess.

But at the same time, they want to remain where they are. They are not willing to hand their power and their money over to another group within the cartel.

They didn’t get where they were putting their money on the table to bail out anyone else.

And they won’t this time.

All I’m doing here is assessing what everyone’s real motivations are and who they answer to. To quote another, far more classic television show“The universe is run by the interweaving of three elements: Energy, matter, and enlightened self-interest.”

And, to me, where’s the enlightened self-interest angle for the NY Boys, represented by Powell, for turning over their business to a bunch of European and Chinese commies?

When you step back and really look at what’s happening, they have already told Europe, China and all those emerging markets currently whining, the post-COVID world you created is your mess now.

This is why I’m convinced the Fed will hike and hike aggressively this year, maybe starting on Wednesday.

There is no deal possible between Wall St., City of London and Europe. In that game, Europe loses. If China wants to play hardball and default on foreign-held property debt, fine. Have fun attracting any capital in the future.

All the fiscal projections of the U.S.’s insolvency are great (and accurate) but I hate to burst anyone’s bubble, literally, but you CAN taper a Ponzi scheme if you’re 1) the biggest Ponzi and 2) control the flow of funds into them.

And if you don’t think Powell and his backers at the NY Fed aren’t willing to sacrifice a few thousand points on the Dow or even a few points of GDP, to restructure the US’s finances for the long term while the Fed hands them all the collateral and liquidity they need to keep playing while everyone else craps out, I do believe you are terminally naïve.

It’s what they call playing hard ball.

There are two ways to reset the monetary system. The first option is printer go brrr and default by switching out the old currency for a new one. The other is collapse the old system by returning risk and rebuilding it after the malinvestment is gone.

Paul Volcker chose the latter to finally establish the Dollar Reserve Standard as the only game in town. Nixon set the process in motion, Volcker closed the deal. It’s what established today’s game.

We are at an inflection point in history, both monetary and geopolitical.

I discussed this in my latest podcast with Alex Krainer and believe the rules of the game have fundamentally changed. The next game will look a lot different than the baller one we’ve been playing.

Those who won’t adjust to that or admit it should be very afraid of what Jerome Powell does next.

*  *  *

Join my Patreon if you hate the game, not the playa.

BTC: 3GSkAe8PhENyMWQb7orjtnJK9VX8mMf7Zf
BCH: qq9pvwq26d8fjfk0f6k5mmnn09vzkmeh3sffxd6ryt
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WAVES: 3PF58yzAghxPJad5rM44ZpH5fUZJug4kBSa
ETH: 0x1dd2e6cddb02e3839700b33e9dd45859344c9edc
DGB: SXygreEdaAWESbgW6mG15dgfH6qVUE5FSE

Tyler Durden Wed, 01/26/2022 - 12:25

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