It’s War

Today feels like history is being made. When a day makes history, it’s usually never for a good reason. It’s official. Russia is invading Ukraine. A war that many considered unthinkable has begun. Conditions in Ukraine are rapidly deteriorating. It will reshape European security. This is a very concerning situation. How the international community responds is crucial. Ukraine cannot succeed alone against Russia. The U.S. and Europe must find ways to come to Ukraine’s defense.

• Russia’s actions have brought the world to the brink of a new war on a scale we haven’t seen since WWII.
• Russia was not threatened by NATO or Ukraine. NATO is a defense pact. 
• After years of wondering if NATO still had a purpose, it had found one now.
• The invasion of a sovereign state is a war of choice. Conjured by Putin.
• NATO and the West have failed to put forth a single, uniform position since the crisis began escalating.
• The West’s inability and ineffectiveness works in Russia’s advantage.
• Ukraine is not part of NATO. It’s intention to join NATO is written in its constitution but that won’t happen. On paper, NATO has no obligation to Ukraine. But it’s bigger than.
• The conflict has planted the seeds to re-shape the world order. What it means for Europe. What it means for the rest of the world.
• What if Putin succeeds in Ukraine?
• We need to ask serious questions. Do we have a moral obligation to help weaker countries under attack from a dictator? Don’t we have a higher purpose to answer to? Do we just stand by and watch this?
• If Western countries impose heavy economic sanctions, as they have promised, Russia may hit back in ways that further raise the temperature. An eye for an eye type of thing.
• Biden has the domestic and international support to act against Russia. In a rare show of unity among Republicans and Democrats, Biden has broad support in Congress for tough action.
• Expect a wave of Ukrainian refugees.
• Also expect higher inflation.
• It’s hard to have accurate news of the situation. The Russian propaganda machine is on full throttle.
• By looking at Russian news, they are working hard at changing the narrative in their favor (they are the victim, acting in self-defense, they are protecting the people from Ukrainian genocide ethic Russians, the West wouldn’t engage in diplomacy, accusing the U.S. of crossing its “red line” by expanding NATO).
• Putin doesn’t care about international law. Putin’s actions are based on some sort of concept of rebuilding the Soviet Union. In his eyes Ukraine is part of Russia.
• The short-term goal is to “demilitarize” Ukraine, make it capitulate and replace it with a pro-Russia government.
• Ukraine’s confidence in the West, which dragged it into the conflict and then abandoned it, is shaken. 
• Russia doesn’t care about sanctions. They are used to them and don’t fear them. They also took the last few years to sanction proof their economy. 
• It’s hard to measure the exact effect of the sanctions, even the most severe ones. The wild card is China. If nobody is allowed to buy natural gas, China will buy it. So there’s a market. 
• Russia has over $600 billion foreign reserves.They are built to take a hit.
• Gaz: It’s still flowing into Europe. It has not been disrupted. But once they see the sanctions we can expect the energy situation to change.
• Russia holds Europe by the balls because they are so dependent on Russian energy.
• In normal times Russia supplies 30-40% of Europe’s gas. It’s higher in Germany. Although that share has fallen in recent months as Europe has increased LNG imports.
• It’s mind-blogging how Germany bungle their energy security to be so dependent on Russia’s gas. Germany’s decision to phase out nuclear power is a historic strategic error. Even former German Chancellor Gerhard Schroeder sits on the board of Gazprom and Rosneft. Is it any surprise that he initially sought to exclude energy explicitly from any sanctions on Russia if it invaded Ukraine? 
• The pipelines between Germany and Russia started in the late 60s. The idea was that energy interdependence would produce peace. Instead it empowered Russia.
• Energy: America and its allies need and can wean Europe off its dependence on energy imported from Russia.
• High energy prices hurt Europe and help Russia. The higher the oil price, the more it helps Russia and makes them stronger.
• High energy prices fund Russia’s foreign policy, including its armed forces. Energy is the foundation of Russia’s power.
• Energy: It’s the long-term source of Putin’s power. Sanctions need to hit that. But that might come at a tremendous cost to Americans and Europeans.
• Reducing reliance on Russian gas will require substantial investment and political will.
• European gas currently trades at around $26 per MMBtu. The price of American gas is a little over $4.
• Right now there’s no war between Russia and NATO. But NATO members and former Soviet republics like Estonia, Latvia and Lithuania are on high alert. I would also include non-NATO members like Finland, a former Russian possession.
• Neutral Finland is arming up. They bought 64 U.S. F-35 jet fighters in December. They are close to NATO.
• Russian absorption of Belarus, puts considerable Russian firepower on the border of Poland and Lithuania.
• If a single NATO serviceman is killed, Article 5 is invoked. War against one member of NATO is a war against all NATO members.
• NATO outmatch Russia in terms of forces and military equipment. But…Russia has a massive nuclear arsenal and has not ruled out using them. But I don’t think he wants to start a war with NATO.
• Now the war has begun and it is no longer just about whether Russia will receive a guarantee from NATO anymore. 
• NATO will need to make clear to Russia that such moves to reinforce eastern Europe are not a prelude to NATO military intervention in Ukraine.
• China: China is not 100% in Russia’s camp. Yes China has beef with the US. But I’m not sure China really wants this. I don’t think China wants to further deteriorate their relationship with the US and Europe. I also don’t think they want to anchor themselves to Russia, a weaker power.
• China: Citing concerns over questions of territorial integrity has shied away from endorsing Putin’s invasion.
• China: Sometimes it’s better to stay with the devil you know best.
• Taiwan: This could be the first chess move in re-organizing the world order established after WWII. If the West (mostly the US) doesn’t do anything, what is stopping China from taking Taiwan?
• Taiwan: The Ministry of National Defense of Taiwan tweeted that 9 Chinese fighter jets entered Taiwan airspace. I don’t want to read too much into this because China does this all the time, but considering the timing and the geopolitical situation, I wouldn’t discount anything.
• 90s History: In the 90s, under the Budapest Memorandum of 1994 Ukraine gave up its nuclear weapons in return for security assurances. So much for that. Some 1,800 nuclear weapons returned to Russia.

This is the beginning. The beginning of a situation that could get very ugly. I’ve no clue on it will play out. We are talking about confronting a nuclear power with Putin at its head. But we do know that Ukraine cannot succeed alone against Russia. This is an opportunity for the world to forget about its little problems and come together for a greater cause.

Predictions

I wanted to publish this in January and I never got to it. There’s eleven months left until 2023. Better late than never. My figured my crystal ball can’t be much worse than the experts.

I would hate to be a financial strategist. Expectations are sky-high. At the beginning of each year you have to make ridiculously precise predictions about indexes, commodities, and provide some wisdom on how to achieve world peace. How do you keep a job like that?

I’m always reminded, when I read previous expert predictions, of just how hard it is to predict the future. Two years ago, none of us predicted Covid. Last year, no one predicted the levels of inflation that we’re seeing now, although some of us talked about the risk of inflation.

It’s important to be humble. Here’s the takeaway: Making predictions about the future is a fool’s errand, planning for the future is not.

For the purpose of fun, I’m going to give it a shot.

S&P 500

Target: 4500. Yes I think the market will finish in the positive (~4325 now). But it won’t be a smooth ride. 

The Fed is taking the punch bowl away. The pandemic-era party appears to be ending. Stocks, bonds, crypto, you name it—almost every asset class has hit a rough patch since the beginning of the year.

I think the market will “correct” from rate hikes and recover towards the end of the year.

Why 4500? Estimated earnings of $225 with a multiple 20x = 4500. The genius: I like round numbers. So expect some big ESP surprises.

Interest Rate

5 rate hikes max. The 10-year T-Bill will finish at 2.5%. It might trend higher during the year but will probably trigger a negative response and withdraw. Inflation should also normalize (come down) in the 2nd half of the year. More on that later.

If the Feds are too aggressive they risk inverting the yield curve, which would flash warning signals about a looming economic contraction. They don’t want to kill the recovery and some inflation is welcome.

Inflation

The key question was “Will the inflation be transitory, or can the Federal Reserve still rein it in?” Well you don’t hear the word ‘transitory’ anymore.

My sense is that inflation in the second half of the year is going to come down more rapidly than the typical media reports suggest.

Many of today’s headlines are just wrong. They take an overly simplistic view of what is happening. The inflation data, for one, overstate what’s going on. Of course I recognize that there has been an increase in core inflation, and that wages are rising. I shop and buy groceries like everyone. My bills are not going down.

But we have to recognize that much of the increase in measures like the government’s CPI comes from factors that are one-time events. There has been a huge increase, for example, in the price of used cars. Well, families don’t buy cars every year. There has also been an increase in home prices, but homes are not recurring purchases. 

Remember inflation is a year-over-year phenomenon. If oil goes from 50-100 in a year, that is +100%. If it stays at 100 the second year that is 0.0%. We are going to see inflation data come down. 

The best starting point from which to consider this is the bond market’s current expectations, which are for the Fed to indeed stick the landing; in other words, the market thinks that inflation is most likely to recede over the coming years and be close to 2-3% annually in five years. Perhaps it is the huge collection of assets sitting on the Fed’s balance sheet providing the market comfort that a path to quickly remove liquidity exists if need be.

Oil

I want to go with the  classic safe answer of “between $50 to $100 per barrel”. But that’s no fun. My job is not on the line here. I’m not on TV or popular magazines. It’s a blog. My blog.

The narrative is that market dynamics will keep pushing prices higher, well above current levels around ~$93 a barrel. Some analysts are saying $100 oil is just the beginning. The thesis is there’s simply not enough oil being pumped and demand is growing fast.

I’m going to go against the grain on this. Being an oil contrarian has paid off in the long term. Oil prices is one area where it seems that all the experts agree and that’s scary. I’m not an oil expert, so I think oil prices will go down by the end of the year. The thesis: Not supply and too much demand, is already incorporated in the price.

Traditionally speaking producers respond to high oil prices by over producing, which hurts oil prices. That’s why the cure to high oil prices is higher oil prices. Normally, a US$100 a barrel typically would spark a frenzy of new drilling. Producers get greedy and flood the market. It’s true that producers haven’t responded to high oil prices like in the past because of ESG concerns. 

They are also more disciplined. Because of past boom and bust energy producers are more conservative and preach disciplined capital allocation. Companies have committed to higher production. Not the kind of increases you would have seen in the pre-covid past, but a more measured production raised. Producers care more about having a decent return on their capital than trying to win market share at any cost. Cash flows will go back to investors through dividends and buybacks instead of more CAPEX. A balance market is better long term. A bust brings too much damage. But producers will eventually respond to the market. These prices are too good to pass up and the more they go up the more it weakens their discipline. It just will take a little longer.

There’s a failure of the analytical community to look at what’s happening on the ground, to look at projects that have been reaching final investment decisions, to look at where the efficiency of capital is. 

Capital spending levels don’t reveal very much. After the last oil crash companies have gotten much more efficient, reducing the cost of finding and development by more than half in the past few years. So every dollar they spend is going a little further, meaning production can rise without very much spending. 

Oil is a wild card. Analysts are calling for $100 oil. I wouldn’t be surprised if it hits it and goes higher. However I think it will trend downward. Yes the amount of CAPEX to pump oil out of the ground is down compared to other peaks. But I think what the market underestimates is how much more efficient they have gotten since 2014 and how much costs have come down. 

$100 oil is possible. Will it stay there? I doubt it. Expect supply of 101m-102m barrels of oil per day and demand to match it. But I think  that U.S. companies will boost production by more than 1 million daily barrels a year and the rest of the planet will respond. Prediction: $70! But of course a war or some black swan event is on the menu.

(Update, a few hours after writing the previous lines Russia sent troops in the breakaway regions of Ukraine. Fear of disruption in the energy market sent energy prices way up)

Gold

I have no clue on how to value gold. There’s no cash flow and there’s an esoteric feel to it.

We are in a period of “high” inflation, unrestrained government spending and the debt pile is getting higher. Central banks have been virtually “printing” money. Yet, the price of gold hasn’t responded. It has been trading sideways for over a year. The traditional thesis of 1) Inflation protection and 2) Alternative to the debasement of fiat currency is not working. You can also add geopolitical tensions and potential war to the mix. I’m not sure if I get it. 

My suggestion is to avoid the commodity directly (unless you are buying jewelries) and look at producers and royalty companies. They make good money at this rate.

My bet: Gold will finish the year below $2000/oz. Why? The central bank will raise interest rates and “restore” a little bit of trust in the dollar. 

Cathie Wood

This part is more opinion than a prediction.

Cathie Wood, the star fund manager and chief executive of ARK Invest, is the investment icon of the pandemic era. She crushed it in 2020. She was the winner of the pandemic. ARK’s seven ETFs returned an average of 141% in 2020. She was the toast of Wall Street.

But Wood has had a tougher time in recent months. The ARK Innovation ETF (ARKK) is down 31% in 2022. It has lost more than 56% since its peak a year ago. And most of her investors haven’t done so well because they piled in at the peak of her performance.

Why am I bringing her up?

As a valuation professional it’s frustrating to watch. People have invested their retirement money and their kids’ education money in her ETFs.

Look I don’t like to see somebody losing money. It can happen to anybody. But there’s a little bit of “I told you so” in ARK’s debacle. We have seen this tape played many times in the past. Her MO is concentrated investments in companies with neat ideas and zero earnings, with astronomic valuations (if they can be measured at all). This is a recipe for disaster because 1) when companies don’t live up to their prospects (e.g. Peloton, Roku…) and  2) when rates rise, and they will, it will hurt the present value of future cash flow. And all of Wood’s investments rely on the future profits in years to come. 

At the end of the day valuation matters. Fundamentals matter. Cash flow matters. Profit matters.

Prediction: More carnage for ARK.

Russia-Ukraine War

Russia won’t do a full invasion of Ukraine. The cost is too high. Instead it will support the separatist regions and will never stop harassing Ukraine through different means (cyberwar, coup, rigged election, propaganda etc…).

(Update, a few hours after writing the previous lines Russia sent troops in the breakaway regions of Ukraine. I still don’t think a full invasion will happen.)

Summary

The market could be in for a wild ride. At least for the first half of the year. The Fed indicated that it was heading for earlier, faster interest-rate increases and an eventual reduction of its balance sheet.

In a world of zero interest rate, it’s the more speculative of the speculative that worked. I sat that out. Why? Because valuation matters. The price you pay determines your future return. Now the tide is turning.

With rates rising I see a big shift coming in the investment narrative from a focus on the central bank’s balance sheet to a focus on companies’ intrinsic value. Cash flows, business fundamentals, and valuation considerations will be a greater driver of returns as the Fed potentially contracts the balance sheet. 

Wall Street and the financial media are fixated on the Fed. Business owners and Entrepreneurs view things differently. They say, “If I can’t make money with all this liquidity and super low interest rates, I should go out of business.”. Focus on the businesses.

Canada Blockade

This post is a brain dump. Here’s a few “hot” items on the menu:

Protesters

I share their frustration. I share their anger. Nobody is happy with what’s going on. Everyone is affected and tired. I get it. Trust me, I want my “normal” life back too. 

But overthrowing the government that was elected four months ago and replacing it with a committee that includes a radical white supremacist group at the head table is not the solution (a point they reiterated this week). Ironically they are using democratic rights, like free speech and the right to protest, to try to remove a democratically elected government with a clear mandate 4 months ago.

We have a right to free speech. We have a right to protest. You have a voice. I’m your ally even if we don’t see eye to eye. Because your rights trump my opinion.

There’s a legitimate discussion to have regarding vaccine mandate for truckers and other measures. We can talk about that. We are looking for a solution to get out of this mess. We need a framework to return to normal. The problem is that protestors are looking for a simple solution to a complex problem.

The part where you lose me is when you use your right to cause chaos and ruin the lives of citizens and workers. Or wave confererate flags or nazi symbols. This does not help your cause. Big crowds always attract morons. The BLM and January 6 people found that out. This was no exception.

“Freedom” doesn’t entitle you to ruin other people’s lives. Your interests don’t supersede the others. Your rights are not above those of society. It’s not about liberty. It’s about them. 

What you are doing is illegal. A 4-year old kid with cancer couldn’t get to his chemotherapy treatment because he couldn’t get to his appointment. Small shops, takeouts, restaurants and large stores can’t open. Brave people who work through the pandemic plus entrepreneurs trying to stay afloat are impacted. Ironic that protestors are willing to trash the income of others.You are turning the population against you. 

Do you know how many people are occupying downtown Ottawa? 250. How many people voted in the last election four months ago? 17 million. Thank god we are not invaded.

Democracy

Democracy is messy. It’s not perfect. It’s frustrating. It’s slow. Nobody ever gets everything they want. You have to compromise. But I will take democracy over tyranny any day. 

Here’s the thing with democracy. If you don’t like the decisions the leaders are making, you can vote them out. And politicians go to bed thinking about how they are going to stay in power and wake up thinking about how they are going to stay in power. And most of the time that means giving people what they want.

Truckers

I like truckers. They are an important part of our economic fabric. They move the stuff we need. It’s hard work that nobody wants to do. They are certainly underappreciated.

The issue is that we have protestors that have hijacked the trucker’s mouvement to push their seditious agenda. Protestors that are ruining other people’s freedom under the pretext of defending it. This is not helping the trucking industry or their conditions.

Trudeau

Politics 101 = the greater the crisis, the greater the opportunity.

Where is our leader? He doubled and tripled down on rhetoric, basically adding fuel to the fire.

It’s in times of crisis we get to see what people are made of. Trudeau clearly failed. Some Liberals have broken rank and criticized Trudeau, saying what a lot of people have been thinking. I know the protesters want Trudeau’s head but with the way things are going I think the real threat is inside the Liberal party. This guy is not a leader and I can see a scenario where the party wants to move away from him, like the Conservatives did with O’Toole.

There’s no clear solution to this crisis. I’m not saying to send in the army. There’s still room for a pacific solution. If there was one the truckers would have been one already. But Trudeau has the space to act like a leader. And he’s not. He should be trying to find solutions and he’s not.

And why do we hear more about the U.S. leaders regarding our domestic crisis?

Conservatives

If you think the Liberals mishandled the crisis, the Conservatives, thinking they had something to gain by supporting the protests, realized they were on the wrong side. What a 180 on their part. They made a serious miscalculation and are now telling protestors to go home. Well except for Pierre Poilievre (it’s because of guys like him the Conservative will never make traction and get elected). It’s not good for the future of this country, the democratic fabric of this country, and the image it projects internationally when you align yourself with a seditious mouvement.

They have realigned their guns. Now all parties and the Liberals now have a united voice on the issue.

As a side note, it’s a sad and confused time for Conservatives. They could be in power. The Liberals and Trudeau provide easy opposition. But yet they can’t get their act together. 

Their association with the Freedom Convoy will deepen and intensify the rift on the political right. As such, it’ll repel many centrist Canadians, 90% of whom think vaccines are the best idea to stop people from dying and overwhelming hospitals.

Dictatorship

It’s actually painful and embarrassing to write. I deleted it. Then rewrote it. Then delete it. Then I wrote it again.

No, Canada is not a dictatorship. It’s insulting to people actually living under real dictatorship.

Still not sure? Go to China or Russia and try to have a convoy of 4 trucks together hooking for “freedom”. You will be scrubbing the floor in a Siberian gulag just thinking about it. In Kazakhstan the police have orders to shoot protesters on sight. If you want to protest inhumane conditions, the list is long. 

Do you really think Trudeau is a dictator? Come on. He would be the world’s worst dictator. Dictators are mean, tough, and crush dissidents. Right now Trudeau is hiding.

Do you know who wins while we fight over stupid matters? They do! We look pathetic. We have free speech. A world without it is a tyranny. 

Patriots

Camping downtown Ottawa doesn’t make you a patriot. Honking your truck doesn’t make you a patriot. Having a tantrum because you need to prove a vaccine doesn’t make you a patriot. Harassing volunteers trying to feed the homeless doesn’t make you a patriot. A patriot doesn’t block roads so a 4-year old with cancer can’t get treatment. A patriot doesn’t desecrate the National War Monument. A patriot doesn’t turned the statue of Terry Fox into an anti-vax, anti-medicine monument.

Here’s a real patriot:

Canadian Tomb of the Unknown Soldier

The people in the ground paid the ultimate price for freedom. The vaccine is a small cost for freedom. How ironic that their freedom to be in Ottawa protesting the government was paid for by the blood and death of that soldier & every other unknown soldier.

A real patriot stands up for what is right. A real patriot put their life on the line for a cause much bigger than himself. A real patriot respects the people that have fought and died for Canada. A real patriot doesn’t associate with Nazis waving swatikas. Real patriots fight them.

Generations of Canadians have fought and died for our rights, including free speech. Just keep that in mind before urinating on it.

Vaccine

Can you still get the virus? Yes. Can you still transmit it? Yes. But that’s not how vaccines work. It never did. The vaccine works. We have data. Good data. Who dies? The old and the unvaxx. Getting vaccinated means you don’t take a hospital bed. Hospital resources that should go to people that really need it.

You heard people saying that that covid is only a sore throat. Well that is the vaccine at work. My mom got it and thank god she’s vaccinated because she’s what you call vulnerable. She checks all the boxes. She’s triple vaxxed, got it, had a cough for a day, and didn’t clog up the health system. Thank you vaccine.

We should embrace the marvel of modern medicine and science. It’s amazing what we can do. The things that people would have wished for in the past. But nope, there’s a 10% that still cling to crystal therapy.

The thing you heard a lot last year from the vaccine skeptics is we don’t know what it does long term. They said millions would have died in the next year. Well it’s been over a year, I got three doses and I’m well enough to write this.

Restrictions

90% of the population is vaccinated. Yet, restrictions are imposed on 90% of the population because 10% don’t want to get vaccinated. And that’s frustrating because the unvaxxed 10% doesn’t care about restrictions and as a result the 90% is penalized.

The unvaxxed are the most vocal group about getting out of this mess but take actions further stay in this mess. If there’s anyone that should throw a fit, it’s the 90%.

It’s your right if you want to get vaccinated or not. Getting vaccinated is a small cost for liberty. But keep in mind that actions have consequences. 

How Will This Play Out?

Allow me to speculate.

The problem Trudeau has is that he has a few, narrowly circumscribed bases of power that are enough to get elected but not enough to govern against the will of the people. Those are very different things.

So that leaves him with very serious limits on what he can accomplish in this situation. The truckers were smart to organize themselves locally and create many small spots of trouble. Similar to an insurgency. Local decentralized warfare that relies on local support. Basically the government is playing whack-a-mole.

The question is how long can the truckers last?

Conclusion

Are you tired of the pandemic? Yeah, me too. Everyone is. One dose, two doses, three doses. Remote learning, zoom, vaccine pass.Nobody likes this stuff. It’s stressful. But that pales in contrast to those who have had to lock up their restaurants and failed small businesses whose dreams and savings are now dashed. Or the 35,000 Canadians that died.

The path through this mess is 1) working together 2) through science and medicine. Not through playing soldier under the guise of ‘freedom’.

Metaverse

The buzzword of the hour.  

What is the metaverse? It’s whatever you want it to be.

What does it mean? It means whatever you want it to mean.

Right now, more than anything else, the metaverse is a conversation shifter. 

Your stock is in the dump. Just mention metaverse.

You’re conducting your business in a shady way? Change your name to Meta and your past is erased.

You are not going to hit quarterly numbers? Just add the metaverse slide to the deck.

The NYT reported that Microsoft’s acquisition of Activision Blizzard is a major breakthrough for “the metaverse.” Nice, everyone likes a major breakthrough. What is it? I’ll settle for a tiny breakthrough.

Microsoft’s Nadella says the buy pushes it further into the metaverse even if what the metaverse is has not been fully fleshed out yet. Maybe you should have a clearer idea of what you are pushing into because you are about to spend $75 billions.

Mark Zuckerberg says he hopes to spend the next several years elevating users to “an embodied internet.” Hurry up because we can’t stand the disembodied Internet.

The “metaverse” is the granddaddy of all the buzzwords because it links all the other hot words, like VR, AR, cryptos, NFTs, blockchain, Dao, Web3 together. Take all these words, dump it in the blender, and you get the metaverse. What is it? Well we are still trying to figure out the meaning of the “ingredients” like NFTs. Imagine you have a wife and everybody gets to drill her and you can’t do shit. But it’s ok because you have the digital marriage certificate that says she’s your wife. That’s a NFT.

The metaverse has been described as a virtual space where you can hang out with your friends, colleagues, play games, and shop. But don’t we have that already with Roblox and Fortnite? Wouldn’t the platform Second Life fit the description? What happened to the good old bar? My favorite un-VR spot that offers great offline whisky.

Look I get it. This post is a little bit on the negative side. There’s a part of me that’s not very patient with being b-sing around. “The masses are poking around? Tell them about our metaverse strategy, that will buy peace.” It gets nauseating to hear all this nonsense about the metaverse. We are still at the stage where we are working out what it even means. The word was coined by Neal Stephenson in the book Snow Crash, published in 1992 (did Facebook steal that too?) and it’s the idea we have been working on since. But right now “metaverse” is a parody of marketing bullshit. It’s nothing more than a nice label on a whiteboard.

I’m positive about new technology. We need big dreams. We need things to believe in. A big fat goal to aim our energy towards. And that’s what the metaverse is. We are pushing the edge of technology.

I look forward to the next big innovation wave. I look forward to seeing where AR/VR takes us, or what will come out of the next big trend in computing. How it will help us and progress the human race.

And right now I look forward to seeing what emerges from the wreckage of the metaverse buzz.