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Kid Mercury
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About the ethereum flash crash

Yesterday ethereum had a flash crash in which it's value fell by 96% before recovering. Coinbase froze ethereum order execution while this was going on.

A few thoughts:

1. This will happen a lot more often, still a long way to go until things are stable
2. Is ethereum a stable network for coins to be built on top of? I used to think it could be, but after yesterday, and thinking about how much more development it still needs, I wonder if instead the world should be taking the opposite approach: start with wholly independent coins, then connect them through an agreed upon protocol.

Maybe too early to know the answer there. 


One of the things I talked about back in the day -- like 8-9 years ago or so -- was hyperinflation.

I thought it would have happened by now, but I still believe it to be likely. The price of housing, food, and financial assets all show it is lurking and ready to emerge. The fed hiking rates could expose the inability of public debt to be paid, and a loss of confidence that will ensue.

US Stocks have a CAPE ratio of what we had in 1987 before the crash, rates are rising, and vix is at the 2007 lows. I believe a breakout is coming, and that the breakout will be higher for stocks and real estate, and lower for bonds and the dollar.

What I got right, what I got wrong

Last week I reviewed my old blog posts (now offline) that talked about my views on virtual currencies about a decade ago.

What I got right, in my opinion:

That internet platforms would issue currencies that would supplant nation states and revolutionize monetary policy, and that this would be an opportunity that creates immense profits and changes the world. Many will say it is too early, but I think at least the rise of cryptcurrency bubbles makes this viewpoint far more likely.

What I got wrong:

I thought virtual currencies would emerge from game economies and leverage game mechanics significantly. I still think this may happen, but at least for now, it does not appear to be a meaningful driver.

I also did not see the blockchain coming. While I still believe the solution that gains adoption will be far more closed -- and already we are seeing trends in that direction in my opinion -- the blockchain is an important technology that could allow for many currencies to work together in a federated way. I think ethereum is already on this path.

Entering the Promised Land

It took me until a few weeks ago to understand that ethereum, or something very much like it, is the promised land -- the fulfillment of the prophecy of entering a golden age, a Utopia. Smart contracts designed natively with the protocol will allow for a revolution in monetary policy and a transition away from the nation state to a world governed by internet platforms. The return of sound money means the potential to solve essentially all of the world's biggest problems, since all of the biggest problems stem from monetary policy. Moreover, it will unleash the business models that disrupt google, Amazon, apple​, etc and unleash a new class of Titans. More importantly, though, the new blockchain Titans will be disrupting nation states, and in doing so will redefine things like nationalism and patriotism.

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AirBNB, the Next Great Real Estate Fund

This elaborates on my last AirBNB post.

If all goes well with their recent product launch and the trajectory continues, they should be in a position where they have the assets to understand what neighborhoods in the US will get rehabbed and see a sharp increase in value. In fact, AirBNB will be in a position to move the market in the direction it sees the most economic benefit. It will then invest its resources into rehabbing and promoting a local market, and will be in a position to profit from every part of it. The company will end up being a shepherd of various neighborhoods in which it has a deep economic interest, and thus those neighborhoods are always well-run, in spite of having high turnover.

There's a lot of synergetically compatible ways the company can make money here. To make the most of it, though, they'll eventually need to challenge local governments more and more, including in uncomfortable areas like law enforcement and security. 

Is It Over For Trump?

I think it might be.

The Syrian strike is a total globalist move that empowers the intellience agencies and the military industrial complex they control. Trump's support for intervening to attack Assad is a globalist move. The loss of Flynn and the removal of Bannon from the NSC, while a lot of people say they were planned, concern me in that the removal of the members of the team that seemed most pure to the resistance to the globalist agenda has now coincided with what appears to be pursuit of globalist policy, as expressed by the decision to attack Syria.

So looks like Trump is now becoming a regular military republican, supporting, wittingly or not, globalist policies that wreak economic havoc. He'll lose his core supporters for doing so, which means no one will be passionate about him.

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Pizzagate should be investigated.

Pizzagate should be investigated:

I'm troubled by the refusal of many, even within the kook community, who dismiss this. It seems to me that this whole story will yield multiple feasible routes to take on exposing the global elite pedophile ring that is already widely known about it. The research and potential evidence produced via Pizzagate crowdsourcing is abundant and in my opinion, convincing. 

Another Way AirBNB Can Save the World

AirBNB could be a company capable of unseating Google or Amazon.

They intermediate the temporary stay rental real estate market, and are now branching out into monetizing what you do on your trip.

Hopefully, they succeed wildly on this front, and get to a position where they can essentially build new communities. They'll be able to tell you where to go and what to do to have a good time.

If they get really good at this, they'll find a way to create city experiences that are substantially less expensive than city experiences as we know them today, making them more accessible to a new market of customers for the urban experience and urban life.

Essentially, they'll be disrupting the city state.

In doing so they could massively reduce real estate costs for society, and profit wildly themselves from doing so.

As the US enters a civil war style period in which faith in government continues to disintegrate, an opportunity emerges for a new player to take that governmental role.

AirBNB, this could be your destiny. 

WebGL as a Disruptive Technology

The technology that excites me the most (not counting virtual currency, which I am excited about more because of its a sociological, commercial, and political implications rather than the technology) is virtual reality (I’ll use the term “virtual reality,” or “VR,” as a blanket term to encompass augmented reality, cinematic reality, 3D visualization, and that type of stuff in general). Most of the ideas I’m fascinated with (to the extent that I would like to pursue an entrepreneurial venture around) surrounding VR are capital intensive, which make them a non-starter. However, there is one area that seems to be very in my capital range (i.e. close to free) and still, I believe, exciting and filled with opportunity: WebGL. 

#WebGL is a JavaScript API for 3D rendering in the browser. To put it simply, it makes creating VR in your browser very simple – essentially as simple as creating a web site. Of course, creating a web site can be a project that is fairly simple or inordinately complex, and WebGL enables quite a bit of sophistication as well. 

The idea of VR in the web browser is not new, and historically it hasn’t worked very well. This leads many to believe it won’t work now as well. However, I think the appropriate parallel here is mobile computing, which is a technology that was around long before the iPhone. However, it wasn’t until the around the time of the iPhone in 2007 that capacitive touch screens became cheap enough. 

Likewise, I think we are now at a major point in VR, in which graphics processing units are finally cheap enough, and frontend technologies (namely HTML 5) are finally robust enough  to make browser-based VR a reality. 

So what kind of entrepreneurial opportunities does this enabling technology allow for? Put another way, what incumbents are at risk?

I think all the firms built on old school animation software are at risk. Granted, old school animation software is WAY better than what you are going to get out of WebGL. Of course, disruption is often about something crappy and cheap iterating until it shatters a paradigm, and I think we may have the genesis of that ready to foment. A grandiose vision might be that “the next Pixar” would be a firm that gets its start by developing expertise in WebGL, who finds a currently undiscovered set of customers that industry incumbents like Pixar are unable or unwilling (because of too little profits, presumably) to satisfy. This might be a WebGL animation studio that focuses on creating and curating short web animations, delivered and monetized via the web, mobile apps, VR headsets, special events, and who knows what else. 

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Project Beyond and Volvo Reality Illustrate VR as Disruptive Technology

First, there's Samsung's Project Beyond. The short story is that you put on a VR headset, and you get a VR view of a Project Beyond camera your VR headset is connected to. Imagine this for video conferencing, distance learning, and consulting, among many other things.

Then there's Volvo Reality for Google Cardboard. This gives you a way to check out Volvo cars in 3D. Anytime you've had the experience of "I don't trust buying it online because I need to see and feel it" -- as many people do with cars -- you can think of this. Will the next big ecommerce player get started with using virtual reality to sell products/services that really need high tough? Amazon started with the ultimate low touch product -- books. Now, it knows it is unable to sell some things, paint being one example, simply because it cannot get the online experience right. Virtual reality could fill this void, and lead to disruptive theory playing out accordingly as a new model for distance commerce emerges. More on Volvo Reality:

It's clear to me that the "smartphone + headset = VR" model has some traction, though I'm still more enamored with the full body stuff Kinect is doing, just because I think it enables so much more. But I expect both models to co-exist. I still believe one of the biggest obstacles, if not the biggest obstacle, will be bandwidth. On some level, I think VR systems will rely on proprietary formats and smart devices doing a lot of work locally to reduce the amount of information that has to be transferred over the Internet. 
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