Category: Investments

To Become a Better Investor, Think Like Darwin


On financial innovations — read derivatives and securitizations — and the need for more collaboration :

People respond to incentives, and so if we want to take on much bigger challenges, we need to collaborate across thousands and in some cases hundreds of thousands of people. How do you get 100,000 people to work together? It’s not that easy. In the old days, it was religion and before that it was simple fiat rules, tyranny. The Egyptians built some beautiful pyramids, but they did that with hundreds of thousands of slaves over decades. If we rule out slavery as a possible means of societal advances, there really isn’t any other choice. If we need 100,000 people to cure cancer, to deal with Alzheimer’s, to figure out fusion energy and climate change…I don’t know of any other way to do that other than financial markets: equity, debt, proper financing and proper payout of returns. I think that in many cases [finance] probably is the gating factor. That, to me, is the short answer to the question about why finance is so important.

→ Nautilus

The Daredevil of the Auction World

Capturechris

With contemporary art having become an important investment vehicle for the superwealthy—a profitable and fun place for the rich to park their money—collectors are no longer necessarily connoisseurs. Gouzer is disdainful of the novice client who shows no interest in an artist’s catalogue raisonné, and who wants to know only if the piece he is buying is considered to be in the top ten of the artist’s works. “It’s very much an Instagram way of buying,” he grumbled to me this spring. “You see an image, and you make a decision.” Yet his approach could not be better calculated to appeal to such consumers. Last November, a colleague at Christie’s brought to auction a Modigliani painting of a voluptuous woman, “Reclining Nude,” which had a presale estimate of a hundred million dollars. Gouzer posted an image of the painting on Instagram and offered this unscholarly observation: “Difficult to say which you would want more, the painting for a lifetime or the model for a night?”

→ The New Yorker

Fintech: Search For A Super-Algo

The rise of the machine learning :

The quantitative investment world plays down the prospect of machines supplanting human fund managers, pointing out that the prospect of full artificial intelligence is still distant, and arguing that human ingenuity still plays a vital role. But the confident swagger of the money management nerds is unmistakable. Already there are quasi-AI trading strategies working their magic in financial markets, and the future belongs to them, they predict.

→ Financial Times

David Zwirner’s Art Empire


Follow-up on Bouvier’s portrait, here’s David Zwirner’s :

By one-thirty, there was no sign of the American collector. Braka and Ortuzar huddled, and Ortuzar said, “I’m on it.” At one-fifty-two, the American appeared and resumed scrutinizing the painting. “Look at him sweating,” Zwirner whispered. After a while, he gave the collector a now-or-never gesture. The man borrowed a chair, sat down, and stared at the Richter for a while, chin in hand. Braka stood ten feet behind him. Soon the American got into what appeared to be a heated discussion with Schouwink. Ortuzar approached Braka, and Braka, with a pained smile, nodded and walked away. Zwirner joined the collector and Schouwink. He spoke emphatically to each of them, slapping the knuckles of one hand against the palm of the other. Everything is negotiable. At two-fourteen, the collector shook Zwirner’s hand and bent to kiss Schouwink’s. The Richter was his, and Zwirner had earned three hundred thousand dollars, enough to cover more than half the cost of the gallery’s booth in Basel.

→ The New Yorker

The Art-World Insider Who Went Too Far


The relationship between art dealer and collector is particular and charged. The dealer is mentor and salesman. He informs his client’s desires while subjecting himself to them at the same time. The collector has money, but he is also vulnerable. Relationships start, prosper, and fail for any number of reasons. It is not always obvious where power lies. Over time, each one can convince himself that he has created the other.

→ The New Yorker