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Invisible Art, Invisible Profits

Emperor's new clothes anyone...?
 
LET US BEGIN with a breakfast of humility, writes Bill Bonner in his Diary of a Rogue Economist.
 
Here's Dear Reader David B.:
"I am once again going to take Bill Bonner as a great contrarian indicator. Last time I bought something he couldn't trash enough, it worked out (and continues to work out!) very well. I speculated on what he constantly referred to as 'the river of no returns' (Amazon). Now I am going to speculate on what he calls funny bunnies. Keep up the great work."
Good luck with the funny bunnies.
 
And if that doesn't work out, there are thousands of other cryptos.
 
A report tells us that the Dogecoin – with a picture of the Shiba Inu dog on it – got so much heat that the dogs took off running. Kennels and pet stores report that they can't keep up with demand.
 
Maybe Billy Markus and Jackson Palmer, who supposedly created the coin on a lark, actually had a hidden profit strategy. They were secretly long the Shiba Inu!
 
But if digital coinery is not your thing, maybe you should go into art collecting.
 
We might have had an interest in art...but "modern" or "contemporary" art always seemed like a hustle...much like...well...cryptos!
 
Besides, it was rare to see a piece we actually wanted to look at.
 
Now, however, an Italian artist has taken the hustle to a new level...and solved the ugly art problem. His work is invisible. Here's the New York Post:
"Salvatore Garau sold his piece, entitled 'Io Sono' (I am), to an unidentified buyer last month.
 
"Italian auction house Art-Rite organized the sale of the 'immaterial' statue in May with a beginning estimated value coming in between $7,000 and $11,000. [It sold for $18,000.]
 
"Explained the Sardinian-born artist, 'The vacuum is nothing more than a space full of energy, and even if we empty it and there is nothing left, according to the Heisenberg uncertainty principle, that 'nothing' has a weight,' according to Hypebeast. 'Therefore, it has energy that is condensed and transformed into particles, that is, into us.'"
Yeah, right.
 
And we're going way out on a limb here...with a prediction.
 
Readers who invest in invisible art will make invisible money. More important, they don't deserve to make any money.
 
But at least they won't have to look at, say, a Lucian Freud painting!
 
And, of course, we could be wrong. Garau could turn out to be the Picasso of the 21st Century. And "Io Sono" could launch a whole new genre of undetectable art.
 
Soon, big corporations will hire consultants to help them buy important pieces for their lobbies and board rooms.
 
The sons and daughters of ruthless hedge fund managers will do doctoral dissertations on "The Epistemological Display and Epistolary Dimensions of the Unseen from a Post-Hegemonic Perspective."
 
And museums will bid up prices at auction houses, putting invisible art...mercifully...out of range of the common man.
 
But that's the trouble with Bill Bonner as a great contrarian indicator; he is not always wrong.
 
Yes, he was dead wrong about the investment promise of Amazon. He thought Picasso was a con artist.
 
And he's still amazed that people can type with their thumbs. "That'll never catch on," he predicted when "hand-held computers" first appeared.
 
As an aside, we visited a rural hotel – Ballymaloe House – on Saturday, and discovered that at least we aren't the only one left behind by popular culture.
 
The innkeeper recalled the day American rapper Jay-Z came to stay.
 
"Three large, black vans pulled up in front...where we don't allow people to park.
 
"They got out and told me that Jay-Z was here.
 
'Who is Jay-Z?' I asked. 'And doesn't he have a last name?'
 
"I told them I didn't care who he was, he'd have to move his bloody vans away from the front of my hotel."
 
Your editor was at a loss, too...he didn't know who Jay-Z was either.
 
But he knows a bubble when he sees one. He was generally right about the dot-com bubble in 1999...and the housing bubble in 2006.
 
And we'd guess that he's right again about the Great Everything Bubble now.
 
In any case, Dear Readers are urged to take his scribblings for what they are – one man's guesses. Nothing more.
 
If they want a more consistent, cocksure, and certain source of advice...they are invited to take out a subscription to The New York Times.
 
There they will find Paul Krugman. The elite of the elite. A Nobel Prize winner. The kind of person presidents and mental defectives alike can listen to.
 
And he's reliable. He is wrong about everything...wrong about how the world works...wrong about how an economy works...wrong about capitalism...and wrong about markets.
 
In 2002, he urged then Federal Reserve chief Alan Greenspan to create a bubble in housing. The deed was done. It blew up. Four million families lost their homes.
 
Then, in 2008, he urged the feds to create another bubble to offset the effects of the one that had just gone bust. That was done, too. Federal debt tripled. The Dow quadrupled.
 
And in 2016, he forecast what would happen next:
"...we are very probably looking at a global recession, with no end in sight. I suppose we could get lucky somehow. But on economics, as on everything else, a terrible thing has just happened."
He was right about one thing. A terrible thing had happened. Donald Trump was elected.
 
But it was only a terrible thing because Trump continued to follow Krugman's bad advice. The deficits got bigger. The spending and money-printing – policies that Krugman himself had endorsed – got worse.
 
When Donald Trump entered the White House, US debt was edging up to $20 trillion. When he left, it was nearly $28 trillion.
 
And the free spending did not cause a global recession at all. The boom continued.
 
And soon, another bubble appeared – with its meme stocks, NFTs, below-zero (real) interest rates, invisible art, record corporate debt, $3 trillion deficits, and $2 trillion cryptos.
 
This is the world Krugman helped create...by reliably misunderstanding everything.

Bill Bonner has co-authored a number of New York Times Bestsellers including Financial Reckoning Day, Empire of Debt and Mobs, Markets and Messiahs. In his own opinion, Bill's most recent title, A Modest Theory of Civilization: Win-Win or Lose, is his best work yet. Bill also founded The Agora, a worldwide community for private researchers and publishers, in 1979. Financial analysts within the group have exposed and predicted some of the world's biggest shifts since that time, starting with the fall of the Soviet Union back in the late 1980s, to the collapse of the Dot Com (2000) and then mortgage finance (2008) bubbles, and more recently the election of President Trump.

See full archive of Bill Bonner articles

Please Note: All articles published here are to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it. Please review our Terms & Conditions for accessing Gold News.

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