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The Financialization of Everything – The Atlantic

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Alex Masmej revered Steve Jobs—his favorite shirt was emblazoned with Apples that changed the world: Adam’s, Isaac’s, Steve’s. Masmej dreamed of moving to Silicon Valley to start his own company, but he just didn’t have the money. In April 2020, as the world reeled from the coronavirus pandemic, Masmej found himself stuck in his home city of Paris.

So Masmej did something few 23-year-olds would think to do: He tokenized himself. That is, he created a financial instrument known as a social token, a form of cryptocurrency whose value revolves around a person, to sell shares in himself. Holders of $ALEX would receive 15 percent of Masmej’s income for the next three years, capped at $100,000 overall, and would be able to exchange tokens for special privileges: 10,000 $ALEX bought a retweet from Masmej on Twitter; 20,000 $ALEX, a one-on-one conversation with him; 30,000 $ALEX, an introduction to someone in his network. In five days, Masmej raised $20,092, enough to send him across the Atlantic to San Francisco to launch his start-up.

I work as a venture capitalist in Silicon Valley, and I met Masmej in San Francisco. When he shared his story with me, I was struck by what Masmej’s path to California signaled. Rather than borrow money from investors, friends, or family, Masmej made himself the investment.

This may sound dystopian to some, the plotline of a Black Mirror episode. But social tokens are part of a broader and fundamentally positive phenomenon: everyone is becoming an investor. Over time, wealth has accumulated with a select few—the investing class—while the rest of America rents time as salaried and hourly workers. Only one in two Americans has any exposure to the stock market, and that exposure is stratified by income: Just 15 percent of families in the bottom 20 percent of income earners hold stock, compared with 92 percent of families in the top 10 percent.

But moves by Masmej and others like him point to a shift. More and more of the world is becoming financialized, allowing people to invest not just in companies or government bonds but also in art, collectibles, and celebrities. Parallel shifts in culture and technology are forging a new paradigm. The rules around how we create and capture economic value are being rewritten, opening up new roads to the kind of wealth creation previously limited to a select few.

Today’s youth are leading this transformation by rejecting long-held beliefs: that you should stay with a corporation until you’re ready to collect your pension; that you should spend the hours of 9 to 5 chained to your desk; that you should work for anyone at all. Nearly 80 percent of teenagers say they want to be their own boss; 40 percent aspire to start their own business. Young people watched their parents and grandparents get burned during the Great Recession and again during the pandemic. They harbor a certain cynicism: One 16-year-old mocked me recently for denoting laughter with 😂, rather than with 💀 or ⚰️. Gen Z humor is gallows humor. But this pragmatism breeds first-principles thinking. Why work within the “system” with a capped upside when you can use your hustle and savvy to dictate your own fortune?

We see this cultural shift in the 23 million people buying stocks on Robinhood and in the 46 million Americans who own cryptocurrency. We see it in NFT mania, in the deification of Elon Musk, in the GameStop phenomenon of last winter. If we expand “everyone is an investor” to “everyone is an owner,” we see ripple effects in the record-breaking 4.4 million businesses started in 2020, or in the 68 million Americans who freelance.

Even this generation’s superstars rethink old norms. The 19-year-old TikTok star Josh Richards had flirted with being a brand ambassador for Red Bull. When I asked him why he passed, he looked at me quizzically—why, he wondered, should he be the vessel for someone else’s wealth creation? That’s the playbook for celebrities of yesteryear. Instead, Richards launched his own energy-drink brand, Ani Energy, off the back of his 25 million TikTok followers. A year later, Ani is in over 400 Walmart stores.

A new cultural mindset around ownership is colliding with new technology. We’re on the precipice of the third era of the web. The web’s first era was about information flowing freely—think Google giving you access to the world’s knowledge. Most of us were passive consumers in this era. The second era was the social web—Facebook, Instagram, Twitter. People began to create their own content, and that content became the lifeblood of the big platforms. We became active participants, but the platforms devoured all the profits.

The promise of the internet was to erase the gatekeepers. Instead of waiting for a record label to sign you, you could share your music on Spotify. Instead of asking a publication to share your words, you could tweet. Instead of being tapped by a studio exec, you could become a YouTuber. But what happened is that these platforms became the new gatekeepers.

The third era of the web is about righting the ship. Social capital becomes economic capital. Value no longer accumulates to brokers and intermediaries.

What does this mean in practice? Consider the music industry. Today, record labels capture the lion’s share of the money in music. Artists walk away with a little, and fans certainly don’t get any. But in this new era of the web, everyone can profit from culture.

We all have the (slightly annoying) friend who insists that she knew about so-and-so before they were even famous. When it comes to Taylor Swift, I’m that friend—and I’m more than slightly annoying about it. I was a Taylor fan in her pre-Fearless, full-on country days, years before Kanye interrupted her onstage at the VMAs. But in our current construct of fandom, I’m treated no differently than the fan who discovered Swift on SNL a few weeks back.

This would all be different, though, if Taylor had done what Masmej did and turned herself into an investment. She could have issued a social token. Whereas non-fungible tokens, or NFTs, are so called because of the uniqueness of a digital asset, social tokens are fungible. In other words, each $ALEX token is interchangeable with every other $ALEX token, just like a dollar bill can be traded for any other dollar bill. (If the dollar bill were signed by Barack Obama, though, it would become non-fungible.)

Say Taylor had issued her own token—let’s call it $SWIFT—and say she had sold $SWIFT to her biggest fans. Say I was one such fan. Over time, as Taylor’s popularity grew, the value of $SWIFT would have appreciated. As an early believer, I would have shared in the financial upside of her growing fame. The $SWIFT I’d bought for $100 in 2007 might be worth $100,000 today.

The Taylor Swift mini-economy would serve both the singer and early fans like me. As an artist, Taylor could have funded her work by selling $SWIFT. She might not have needed to sell ownership of her masters, and she might not have been forced to rerecord her albums to take back control over her art. Taylor’s fans, for their part, would have been rewarded for a decade of patronage: We’re all evangelists for our favorite artists, and yet we capture little of the value we help create. Social tokens uniquely combine elements of patronage (support for the artist), fandom (closer connection to the artist), and investment (financial upside from the appreciation of the digital asset).

We can extend this example to any artist: What if you had discovered Billie Eilish on SoundCloud in 2016, or Lil Nas X before “Old Town Road” went viral? What if you’d loved the Beatles before they performed on The Ed Sullivan Show?

This isn’t some far-off vision; enterprising artists are already taking steps to build their own digital economies. The Grammy-winning artist RAC launched $RAC last fall with the caveat that fans can’t buy $RAC—they can only earn it through their fandom. RAC distributed $RAC retroactively to fans based on their support: whether they’d been a Patreon subscriber, whether they’d bought merchandise in the past, and so on. Fans could then cash in the $RAC they’d earned for exclusive access to the artist. You can envision this concept becoming more mainstream over time: What if the best seats at a Taylor Swift concert went not to the fan who has the most money but to the fan who has earned the most $SWIFT by racking up Spotify streams?

To be clear, the financialization of everything isn’t an unalloyed benefit. The phenomenon has a dark side. If everyone becomes an investor, the inverse is also true: Everything—and everyone—becomes a potential investment. As part of $ALEX, Alex Masmej designed a “Control My Life” component. Token-holders could vote on his life decisions—whether he should run three miles every day, stop eating red meat, wake up at 6 a.m. Token-holders had a financial stake in his success, so Masmej followed through on their commands. (To be fair, Masmej admits this was just “a fun experiment.”)

We’ll have to answer two key questions. First, at what point does human agency give way to financial obligation? And second, at what point does a relationship become a transaction? There’s a fine line between investment and speculation, and between speculation and gambling. What happens when someone loses money on $ALEX or $SWIFT? Financializing life and culture could distribute economic value more evenly and equitably, but the system must be designed with guardrails to ensure that we don’t sacrifice our humanity.

These are challenges, but all innovation brings challenges; these challenges shouldn’t prevent opportunity. Investing used to be limited to the stock market, something arcane and inaccessible to many Americans. Now nearly everything is investable. Masterworks lets you invest in fine art, owning a share of a Banksy. Royal lets you buy a share of a song and earn royalties—you could own a piece of the next “Bohemian Rhapsody” or “Hey Jude.” Otis calls itself “the stock market for culture,” letting you invest in LeBron James basketball cards and Air Jordan sneakers.

This new era of cultural liquidity reorients access to capital. The past decade was about transferring social capital: likes and shares and retweets. Our social capital powered the profit engines of Facebook, Google, and Twitter. We’re now shifting to an economic era of the web, one in which everyone is an investor. This doesn’t mean that there shouldn’t be regulation, that companies and institutions shouldn’t think carefully about what safeguards to put in place. It doesn’t mean that there will be a human stock market where we buy and sell our friends. But this economic era does mean that everyone can invest—in fine art, in iconic songs, in public figures they believe in. This era means that it won’t be the few who are dictating culture, but the many. Popular culture will finally live up to its name.

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City investments dropped nearly $5M during this year's first quarter – Moose Jaw Today

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The City of Moose Jaw’s investment portfolios lost nearly $5 million during the first quarter of this year due to — among other things — jittery stock markets, the war in Ukraine and increasing inflation.

During city council’s May 24 regular meeting, council received the investment committee’s report with results from the first quarter of 2022. Council then voted unanimously to receive and file the document.

There was $79,923,836.46 in the long-term portfolio and $29,485,162.61 in the moderate-term portfolio as of March 31, for a total of $109,408,999.07, the report showed. In comparison, as of Dec. 31, 2021, those values were $83,929,536.26, $30,245,558.98, and $114,175,095.24, respectively.

Long-term portfolio

From Jan. 1 to March 31, the long-term portfolio decreased by 4.77 per cent and lost $4,005,699.80. This dropped the portfolio to $79,923,836.46 from $83,929,536.26. 

Moderate-term portfolio

From Jan. 1 to March 31, the moderate-term portfolio decreased by 2.51 per cent and lost $760,396.37. This dropped the portfolio to $29,485,162.61 from $30,245,558.98.

Combined, both portfolios lost $4,766,096.17 during the first quarter, equal to 15.3 percentage points in municipal taxation. 

Since the inception of these portfolios in 2019, they have provided total returns of $18,484,248.18. 

Portfolio changes

During the investment committee’s meeting, it made two changes to how money from the long-term portfolio is invested.

Mayor Clive Tolley moved that $2.71 million from that portfolio be invested in the City of Moose Jaw’s operating account; that motion was approved.

Tolley also moved that the municipality establish a $2-million position into iShares Global Quality Dividend over time; that motion was approved.

Future outlook

Russia’s invasion of Ukraine could lead to a drawn-out period of uncertainty, with the invasion devastating the latter’s economy and harsh sanctions that limit the flow of money, goods and technology affecting the former’s economy, portfolio manager RBC Dominion Securities said in its report.

Due to this war, the financial institution projected a reduction of 0.7 per cent in the eurozone’s GDP growth this year to three per cent and a decrease of 0.3 per cent in the U.S.’s GDP growth to 3.1 per cent. 

“From a long-term perspective, the Russian-Ukraine war brings a range of potential implications, including a new Cold War, increased military spending, nuclear proliferation and a heightened motivation to shift energy supplies toward renewables,” RBC added.

Meanwhile, economic recovery worldwide is slowing because of the pandemic, tightening financial conditions, slowing Chinese growth, reduced U.S. spending and elevated inflation levels, the report said.

Global growth will likely decelerate to 3.6 per cent this year compared to 6.2 per cent last year. Developed-world growth will fall to three per cent from 5.1 per cent, while growth in emerging markets will slow to 4.1 per cent from 7.3 per cent last year. 

RBC predicted that the damage from sanctions against Russia will be unclear, which means the risk for a recession in the United States this year is higher than ever.

Inflation is also punching the United States — and the world — in the gut and running at the highest levels seen in decades, RBC said. The main drivers are surging commodity prices, supply-chain problems, stimulative central banks, labour shortages and a worldwide housing boom. 

“We continue to believe that inflation will, over a longer-term horizon, eventually fully revert to normal, with aging populations and slower population growth even bringing inflation down below historical norms,” the company added.

RBC added that the Russia-Ukraine war would alter the currency landscape, central banks will respond to inflationary pressures, the long-term direction for bond yields will remain up, stocks will have better return potential if earnings come through and re-deploying cash to bonds and stocks will be more attractive.

The next regular council meeting is Monday, June 13.

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DNA Pro Investment App Steals $38 Million from Users: Police – Jakarta Globe

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Jakarta. The National Police on Friday named 14 suspects in the ongoing investigation into pyramid scheme-style investment app DNA Pro after thousands of users reported financial losses totaling Rp 551 billion ($38 million).

DNA Pro was one of the so-called trading robots taken down in a recent government crackdown on phony investment apps.

“There are at least 3,621 victims who have reported to the National Police Headquarters with a total loss of Rp 551.7 billion,” Special Economic Crime Director Brig. Gen. Whisnu Hermawan told a news conference in Jakarta.

He said 11 suspects are already in custody while three others remain at large.

“We believe that the three fugitives have fled to a foreign country,” he added.

The three are identified as DNA Pro’s co-founders Verawati and Devinata Gunawan and business development director Daniel Zii aka Fauzi.

Police have been investigating the suspected fraud since January when they decided to take down the app.

Whisnu said authorities have frozen 64 bank accounts with links to DNA Pro and a combined deposit of Rp 105.5 billion, seized Rp 112.5 billion in banknotes of various denominations, and confiscated 20 kilograms of gold and 14 luxury cars.

An unspecified number of properties have also been sealed during the police investigation.

“We don’t stop there because investigators and their colleagues from the [anti-money laundering agency] PPATK continue to trace assets here and abroad,” Whisnu said.

The officer added that DNA Pro has committed to “manipulative investment” without a proper trading mechanism and any government license.

All the 11 suspects in custody including president director Daniel Abe were presented at the news conference.

Daniel offered an apology to users and colleagues but argued that the initial idea was not to develop a pyramid scheme investment app.

“It grew so rapidly in terms of [the number of] users while our system was not fully ready yet that it developed into a pyramid scheme,” Daniel said.

Other suspects are identified as Rudi Kusuma, Robby Setiadi, Dedi Tumiadi, Yosua Trisutrisno, Franky Yulianto, Russel, Jerry Gunandar, Stefanus Richard, Hans Andre, and Muhammad Asad.

They could face a sentence of up to 20 years in prison if convicted of financial scams.

The app offered big investment returns and even higher commissions if users could bring new signups. It hired celebrities and prominent people to convince new users.

Actress Una Astari Thamrin once spoke highly of the app but last month she claimed that she too was a victim after being interrogated by police.

Una was promised six Honda cars in return for a certain level of investment and a certain number of new recruits in DNA Pro, a lawyer for the actress said.

“She and her family fall victims to DNA Pro because she has invested Rp 1.5 billion but could only withdraw Rp 603 million,” Yafet Rissy said. 

The lawyer claimed that Una wasn’t involved in the DNA Pro management although she was hired to appear in promotion programs on three occasions.

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BC investing more than $2.4 billion in Metro Vancouver transit improvements | BC Gov News – BC Gov News

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The Province is supporting public transit expansion for people in Metro Vancouver through a significant investment in TransLink that will mean better and more convenient service, lower emissions, and healthier, more livable communities

B.C. is contributing more than $2.4 billion to advance key transit and infrastructure priorities, including the Surrey Langley Skytrain and electrification of the bus fleet, as part of its ongoing commitment to fund 40% of the Mayors’ Council 10-Year Vision.

“We’re making investments to support a better future for people throughout Metro Vancouver with more affordable and convenient travel options, cleaner air and less climate pollution,” said George Heyman, Minister of Environment and Climate Change Strategy and Minister Responsible for TransLink. “By supporting TransLink to help provide public transit options that connect us to our communities, workplaces, friends and families, we’re building more vibrant communities with easier access to jobs, housing, recreation and services people depend on.” 

TransLink’s investment plan includes actions to: maintain and expand transit service; support faster, more reliable bus service through bus-priority infrastructure; transition bus fleets from diesel to zero-emission vehicles; and increase active transportation investments. The plan will help TransLink replace more than one third of its diesel bus fleet with approximately 500 battery-electric buses and buses that run on renewable natural gas. It will also provide opportunities to build more complete, liveable communities with affordable housing and increased density around transit lines.

“It has been a challenging few years, and we thank the provincial government for its commitment to ensure transit continues to serve residents throughout Metro Vancouver,” said Kevin Quinn, CEO of TransLink. “This investment plan and the Province’s support will ensure that TransLink is on solid ground while advancing priority projects for the region.”

This new commitment builds on previous provincial funding in TransLink’s 2018 investment plan, which funded increased bus and HandyDART services, better and expanded SkyTrain service, and construction of the Broadway subway.

“The 2022 investment plan will stabilize transit funding for the region and put us in a stronger position to advance Transport 2050’s vision for a more livable and sustainable region,” said Jonathan Coté, mayor of New Westminster and chair of the Mayors’ Council on Regional Transportation. “We are grateful for the Province’s continued support for better public transit and sustainable communities across Metro Vancouver.”

The TransLink investment plan means better transit services for people and also supports the Province’s climate-change and clean-economy objectives through the CleanBC Roadmap to 2030. The CleanBC Roadmap is the Province’s plan to expand and accelerate climate action by building on its natural advantages – abundant and clean electricity, innovative technology and a highly skilled workforce. The CleanBC Roadmap sets a path for increased collaboration to build a British Columbia that works for everyone.

Quick Facts:

  • The Province partnered with the federal government in 2020 to provide TransLink more than $675 million in Safe Restart funding to ensure continued essential transit services for 2020 and 2021, to keep fare increases capped at 2.3% until the end of 2024, and to enable free transit for children 12 and younger.
  • In April 2022, an additional $176 million in provincial and federal funding was announced for TransLink for 2023 to 2025.

Learn More:

To learn more about the Mayors’ Council 10-Year Vision, visit: http://tenyearvision.translink.ca

To learn more about the CleanBC Roadmap to 2030, visit: http://www.cleanbc.ca   

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