Last week, our attention was drawn to two news related to cryptocurrency.
The first is positive that the endowment of Yale University under the direction of David Swensen decided to invest $ 400 million in projects related to the crypt and blockchain at an early stage.
The second is negative, that the well-known economist Nouriel Roubini harshly toured the crypt once again, called her «the father of all scams», and in the end even joked about the fact that the word «shitcoin» cannot be used in relation to the crypt, so how abusive it is for the word «shit» — a useful organic fertilizer: https://cnb.cx/2NESVBO
All this did not affect our opinion about the crypt and blockchain projects, since it is based not on emotions, but on facts. Perhaps it will be wrong, time will tell. But what we want to note. We believe that there is a huge and fundamental difference between these news.
Roubini, who after the crisis of 2008 began to be called «Doctor Doom» and invited under this sousus to various economic forums, allegedly became famous for having «predicted» that crisis. Although he began to “predict” it for many years, but it is clear to all sensible people that if you constantly say that “a crisis is coming,” you will sooner or later enter. Like a watch that stopped, but twice a day shows the exact time.
He is a fairly well-known economist, with his admirers, who teaches at the University of New York. Apparently, there are no other arguments left, and those that they have led so far prove to be untenable.
The question arises, why do they need it? Why do they continue to speak on topics that are not well understood? The answer is simple, and it is well written about in the last book of Nassim Taleb called «Skin in the Game». These numerous commentators, analysts, economists are ready to fill the information space with joy only because they do not risk anything.
What will happen to Roubini if the whole blockchain technology, which he considers simpler than the Excel table, really turns out to be nothing? He will inflate his cheeks and say: «I told you so!». And what will happen to him, if, for example, a bitcoin in a year will cost 35,000, in parallel a more advanced blockchain technology will appear, and the word cryptocurrency will go into mass use? Nothing will happen to him, he will either stop commenting on this topic, or he will say: «Well, it looked too risky, I was reinsured.» He will not lose his place as a professor and all the buns associated with him. That is why his opinion on this issue means little.
Quite another thing is Swensen with his foundation. The person is the epitome of the success of an asset manager. His foundation beats the rest of the universities for many years by the results of management, he earns double-digit returns on a multi-billion dollar portfolio, investing, including not in the mainstream. Yale was the first of the Ivy League universities to invest in hedge funds, private equity funds and venture funds. This gave the result, which is public, and which brought fame to the manager. And now this manager risked his reputation and put a “skin on the table”, having invested 400 million dollars in what, according to the commentator Rubini, who is not responsible for anything, is not even worth the word “shit”.
Can Swensen be wrong? Of course he can. Probably, just like the British Royal Mail, which in the late 1990s arrogantly stated that no sensible person would use Gmail, when the letter can be sent in an envelope with a stamp. But even if Swensen was wrong, he has his «Skin in the Game», and therefore, we have much more respect for his actions.