Drowning is technically an immersive experience

Economists have arts degrees and I sure have one, too.

Good morning, dear friends and happy Thursday. I hope you’re well caffeinated for this one, because it’s a doozie.

If I ever make merch, it will all be terrible. Thank you.

When I first started this draft, it was going in a certain direction, and then another large bank failed this week. Doesn’t that sound relatively improbable, irresponsible, stupid even? Surely, the bank is where the money is, how could it “fail”? Well, there’s the rub. Banks basically never actually have all the money deposited, hence why bank runs a) happen and b) have an effect on the economy at large. Essentially, banks make their own money by lending out your money as investments, whether you like it or not. Rather than being a service set out to document and store people’s money, they use it as their own wallet to turn a profit. This means that at any given time, all the money deposited isn’t actually at their disposal, hence a bank run happens. Clients quickly take out most, if not all, of their deposits, leaving the bank failed and quickly tided away into a bigger bank by the government. The whole rigamarole is ultimately a bit more complicated than this, but understanding even the broad strokes is often enough to make a person start to wonder if this is the best banking system we can really come up with.

Now, if you’re reading this, I think it’s safe to assume that you have at least some memories of the 2008 recession and the slow crawl back to “normalcy”. I certainly wasn’t an adult yet, but the repercussions of the crash were long lasting, and the efforts to curb it were touted as the best that could be done. Given 2008 was less than 20 years ago, it’s hard to stare down another recession and believe the bailouts were good for anyone except a select few. Now, I’m not here to explain the ins and outs of the 2008 recession, go watch The Big Short and read Pity the Billionaire if you want that. Rather, I want to talk about some of the cultural and economic changes that we can trace from 2008 right up to the lay offs and economic turn down we’re going through right now. I find these things very interesting, and I do not mean that as a compliment.

One of the reasons I can’t stand talking to most economists is because most of them aren’t really “economists”, per se; they’re capitalists with a degree in rhetorical arguments to defend the only system they’re imaginative enough to think of. When I do have the chance to meet an economist who doesn’t suffer from extreme tunnel vision, it goes one of two ways. One way is I have a wonderful and interesting conversation with someone who is genuinely interested in structuring production and distribution in an abundant and purposeful way. Alternatively, it means I’m talking to a cryptobro.

Now, for the blissfully uninitiated, cryptobros come in two breeds: the scammers and the scammed. The scammers have, generally, done extremely well for themselves financially and are certainly not hanging out at the dive bars I go to and so I talk to the evangelists who, for some reason, fully believe that cryptocurrencies are going to save the economy. Let me be clear: they will not. Blockchains by their nature are not inherently bad; to keep this short, they’re basically just a system in which information is stored across many servers, hence “decentralized”. There is no authoritative server, but rather a mutual consensus. The problem with the blockchains upon which these currencies are built is that they now exist in a way that no longer supports many of the base arguments made by evangelists. First, it’s hardly easy to consider it as “decentralized” anymore. It may be on a blockchain, but actual access to storing the blockchain would require enough money to buy the memory and system to run the chain, not a cheap endeavour. All that’s really happening is the cryptocurrencies are being recentralized around those that have enough real world currency to secure it for themselves. At first glance, something like a DAO (Decentralized Autonomous Organization) could seem like a democratic dream, but it runs into the exact same material boundaries as any other blockchain based system. When it’s small, it’s accessible, and as it grows it becomes prohibitive to store, let alone keep up with and therefore participate in meaningfully. Second, the irony of needing traditional currency to begin partaking in the crypto economy is wholly lost on these people. Third, is it atrocious for the environment. It relies on people feeling as though things like “the cloud” are ephemeral without thinking of the massive server farms and energy required to keep the lights on. Some cryptopreachers will point to the emissions of the global banking system: ATMs chugging away all night, millions of transactions a second, and while, to be sure, this could be improved upon, it is the global banking system, not the obsession of a few thousand dorks. Finally, it is foundationless. From a functional perspective, something like Bitcoin, by it’s very structure, could never be a global currency as the chain can only handle on average 7 transactions a second, and those transaction times are very far from instant. From a material perspective, it is very literally worthless (as all money is, but that’s an essay for another time). The value of crypto fluctuates so quickly, literally having different values at the beginning and end of a transaction, that an entire system of middle men sprung up to ensure stability. This is where we run into the same problems we currently experience with traditional banks, wrapped up in different language. One of these middlemen, Tether, operates on the idea that they will immediately exchange your cryptocurrency for their own which is, you guessed it, tied to a real world currency. The intention here is that your crypto will have a set value going in to the transaction, with no fluctuation, making Tether a “stablecoin”. The problem with this promise, put simply, is that documentation shows that Tether is owned by the same group of people who own a real money exchange called Bitfinex and these two services share a pool of money, meaning that at any given moment, one of the two services is backed by exactly zero real dollars. So much of recent crypto discourse is techevangelists trying to solve the problems made by their own systems, rather than wondering if the systems are even worth having built in the first place.

To quote another of my favourite YouTubers:

Some of the largest institutional holders of cryptocurrency are the exact same investment banks that created the subprime loan crash… This is a really important point to stress: cryptocurrency does nothing to address 99% of the problems with the banking industry, because those problems are patterns of human behaviour. They’re incentives, they’re social structures, they’re modalities. The problem is what people are doing to others, not that the building they’re doing it in has the word “bank” on the outside.

I’m sorry for talking about crypto for so long and I strongly suggest you watch Line Goes Up, which explains the above in greater detail and helped me explain it in a succinct way. All of this is to say that a lot of “disruptive” thinking about the economy is really just anarcho-capitalism; hyper capitalists looking for the fastest way to make a buck, dodge the tax man and starve social services. I find this simultaneously incredibly interesting and incredibly boring. It is interesting to me that people will throw such faith in a system that is clearly just a bigger fool scam, buying something worthless for a price and hoping to sell it for a profit later, ad infinitum. It’s also interesting to me that they can see the likes of Jordan Belfort singing the praises of a system and see it as a good omen, as though he wasn’t convicted of fraud and barred from ever running an investment firm again. It’s incredibly boring to me because they’re just repackaging a system that is already failing many, and failing more by the day. The food people need has not suddenly stopped existing, housing has not gone up in flames. Our means to feed and shelter populations still exist, it is simply a problem of a handful of people increasing the price of the paywall to access these things. You could even argue that it’s a problem there’s any paywall to anything a person needs access to to survive, but again, that’s another post.

When I originally started this post, I was going to briefly talk about cryptocurrency to draw the line between crypto and the recent influx of “billion” dollar valuations attached to the various metaverse projects floating around. Rather than spend another paragraph outlining how metaverse projects are largely just platforms to try to coax more people into crypto scams and also kind of just suck, I will suggest Dan Olsen’s pseudo follow up to Line Goes Up, The Future is A Dead Mall. Outside the fact that “living” in the metaverse is a ridiculous pitch, you can eat as much as you want in a video game and starve in real life, it is also a nonsense “solution” to basically any social problem. Virtual real estate will not house people, a virtual mall will not address rampant pollution and consumerism. It is, once again, the things we already live with painted with a thin veneer of technology. The thing that really sticks out to me, though, is the obsession with making the metaverse “immersive”. First, VR is an interesting technology that is always going to run up to the limitations of the human body. Your inner ear does not like walking around in a space when the space and what you see don’t line up correctly. This technicality will not stop techbros from being obsessed with creating a perfectly immersive experience in their metaverse projects. The reason I really fixated on this was an article covering the Metaverse Fashion Week that was held in 2022. In Elle, Samantha Tse wrote

Perhaps expectedly, many weren’t able to capture the magic of a physical show, where attendees are fully immersed and emotionally invested in the brand’s collection.

Immersed, you say? In real life, no less! I would like for one of these people to explain to me exactly what they mean by “immersion”. All of this attempt to recreate the world, one to one in a digital space is roughly as ridiculous, shortsighted and selfish as Elon Musk’s desire to colonize Mars. These people look around at the world and do everything they can to escape it. They are called innovators by puff piece journalists rather than held to account for their entire unwillingness to look problems square in the face and do their best to materially address the things that hurt people. It’s techegoism, it’s greedy and frankly, it’s cowardly. It’s sticking your head in the digital sand, claiming you’re fully immersed in the experience when over and over and over again techbros keep telling on themselves by thinking they’re inventing basic human connection:

You really couldn’t write a more satirical tweet on purpose. This all boils down to the same people who have built out the isolating tech of our modern world, thinking they are the first people to notice that perhaps people need meaningful connection. Maybe people like going out and doing things, maybe people like chatting with strangers, maybe they even like having some food and drinks. The hunt for virtual immersion is not admirable, it’s self obsessed people who think being good at one thing means they’re great at all things and equipped to ease all social problems. And yet they are so unimaginative that they cannot even begin to think of these things outside their hustle culture, techbro, podcast, crypto NFT framework. Not to belabour the point, but it’s boring. It exhausts me, mentally, spiritually and intellectually. More than that, despite being so unimaginative, they unfortunately speak the language of those who already have all the capital, hence the ridiculous billion dollar valuations for a metaverse that is really just a bad video game, full of worse video games. We have seen these investment bankers and angel investors have the wool pulled over their eyes more than once. It is wealthy people who enjoy seeing their existing ideas repackaged as revolutionary and not much else. It’s boring, it’s craven and not to lean too heavily on a standard internet insult, but for the love of god, go touch some grass.

Mandatory photo of my editor

As ever, thank you for spending your Thursday morning with me (or whenever you read this). I considered making this one a two parter, but ultimately I think that was enough about techbros. As always, feel free to comment any suggestions for next week and share with anyone you think may enjoy the noise.