I do think that bitcoins current price is more likely than not a bubble that will pop.
But to engage with the issue I don’t think that anybody buys artwork worth 9 figures of money for cultural/signaling value.
If you are in the US with a relatively trustworthy government it’s easy to hold USD and be confident that it won’t lose much value due to inflation. The same isn’t true in many other countries.
I think expensive art gets its value from the fact that really rich people are willing to buy it for social significance. On top of that intelligent art invesors will also buy it knowing that rich people in the future will still want to buy it, but there will be more competition because of the increased number of rich people and the scarcity created by it being held over time by a private seller (the longer it gets held the less likely you’ll get another chance to buy it in your lifetime). What’s your theory on where the value comes from?
Agree on your inflation point. However then your BTC is only a trade away from the less volatile USD. The value propostion seems tough with all the superior competition and better uses. Kinda psyched for the one with a prediction market attached.
I think that art has scarcity and that leads to rich people buying it because they think it wil appreciate in the future.
If you are in a third world country and the government raides your house they can easily take all the USD you have at home. On a bigger scale you have big organsiations buying massive numbers of treasury bills with negative yields because they don’t want to hold cash.
Even in the US you can have the government take your money via civil forfeiture if you carry too much cash around. Numbers suggest that the US police stole more money from citizens via civil forfeiture then was stolen in burglaries.
And scarcity, especially of anything with cultural value, gives prestige/significance to whoever owns it. Like rich people buying cool old but relatively useless cars. It’s just a cool think to have that everyone else will think is cool too. Most don’t care about its appreciation. Some may buy it for that purpose, but not all.
Valuable art pieces also confers prestige on any institutions that hold them. Everyone can oggle at how much the art is worth and assume this must be one of the best museums in the world.
Think of it like buying an overpriced but cool pair of limited edition shoes (Yeezy’s or whatever). Most people will wear them to show them off, but some people will never take them out of the box because they know in the future other people who want to wear them to show them off will pay even more for them. With art, showing it off doesn’t depreciate it so it’s like having LE shoes that never wear out.
It can’t just be scarcity. People have to want the art for some other reason for it to have that value. I can create an equally scarce piece of art by doing one painting, signing my name to it and never doing painting again. Picasso’s are valuable because they are great, famous for their greatness and scarce meaning it’s a big significant prestigious thing to own one.
I do think that bitcoins current price is more likely than not a bubble that will pop.
But to engage with the issue I don’t think that anybody buys artwork worth 9 figures of money for cultural/signaling value.
If you are in the US with a relatively trustworthy government it’s easy to hold USD and be confident that it won’t lose much value due to inflation. The same isn’t true in many other countries.
I think expensive art gets its value from the fact that really rich people are willing to buy it for social significance. On top of that intelligent art invesors will also buy it knowing that rich people in the future will still want to buy it, but there will be more competition because of the increased number of rich people and the scarcity created by it being held over time by a private seller (the longer it gets held the less likely you’ll get another chance to buy it in your lifetime). What’s your theory on where the value comes from?
Agree on your inflation point. However then your BTC is only a trade away from the less volatile USD. The value propostion seems tough with all the superior competition and better uses. Kinda psyched for the one with a prediction market attached.
I think that art has scarcity and that leads to rich people buying it because they think it wil appreciate in the future.
If you are in a third world country and the government raides your house they can easily take all the USD you have at home. On a bigger scale you have big organsiations buying massive numbers of treasury bills with negative yields because they don’t want to hold cash.
Even in the US you can have the government take your money via civil forfeiture if you carry too much cash around. Numbers suggest that the US police stole more money from citizens via civil forfeiture then was stolen in burglaries.
And scarcity, especially of anything with cultural value, gives prestige/significance to whoever owns it. Like rich people buying cool old but relatively useless cars. It’s just a cool think to have that everyone else will think is cool too. Most don’t care about its appreciation. Some may buy it for that purpose, but not all.
Valuable art pieces also confers prestige on any institutions that hold them. Everyone can oggle at how much the art is worth and assume this must be one of the best museums in the world.
Think of it like buying an overpriced but cool pair of limited edition shoes (Yeezy’s or whatever). Most people will wear them to show them off, but some people will never take them out of the box because they know in the future other people who want to wear them to show them off will pay even more for them. With art, showing it off doesn’t depreciate it so it’s like having LE shoes that never wear out.
It can’t just be scarcity. People have to want the art for some other reason for it to have that value. I can create an equally scarce piece of art by doing one painting, signing my name to it and never doing painting again. Picasso’s are valuable because they are great, famous for their greatness and scarce meaning it’s a big significant prestigious thing to own one.