The monetisation of the metaverse is underway, riding on the back of NFT market developments. Owning digital assets is a hot topic right now. Most investment in this space, in these early days will be entirely speculative. Markets will emerge and platforms will be established. All of these platforms will be independently managed and users will occupy their platforms of choice.

These platforms will compete and a few will rise in user numbers and develop to the point of dominance. Early investors will likely win big in these particular platforms. Whether owning individual digital assets in these environments pays off is another question. Management of scarcity will be critical to ensuring value for investors. At the moment it feels like some sort of fear of missing out is driving market forces. Anyone familiar with the early days of crypto investment will understand what I mean. As time has played out that market, speculative investment has turned into real winners and losers. The metaverse will be no different. Serious investors should be looking for signs of success to reduce risk. Who is the team behind the development? What success have they achieved to date? What controls will be put in place to manage market forces such as scarcity of supply.

Willing buyers and sellers is key. This is where large existing user networks that successfully make the metaverse transition could dominate. Think facebook messenger execution. Though let’s not forget Google’s attempted social network fail. There is room for innovative new entrants here as long as they can navigate the chain of distribution to users. Think Magic Leap. Wait Magic Leap, remember them?

Who controls the devices also controls the data pipelines. The pipeline control determines the platforms. Get ready for a big device push from the major players, Apple, Google, Facebook, and Samsung. These major players have existing retail power to push devices to mass markets. As they do meta platforms will grow and the age of the metaverse has truly begun.

There is no doubt that we face a generalised increase in the prices of goods and services. Inflation is a decrease in the purchasing power of money. We need more of it to buy the things we need and want. We can pretend the system is ok and everything is fine. We can shop as usual but it is broken and until it’s fixed, inflation will continue to worsen the imbalance in the underlying system…

In an ideal world, demand matches perfectly the supply of the goods and services available. We know that nothing is perfect, so the system operates imperfectly, increasing or decreasing supply according to feedback and demand. These adjustments take time. Training people to become doctors, psychologists, nurses, builders is a lengthy process and a slow correcting principle.

Immigration on the other hand allows for our economic system to take more immediate action to respond to skill shortages and sudden changes in demand and supply. This supply principle can be adjusted to have immediate effect when needed. When immigration is not an option, we cannot use it to increase supply and therefore this system imbalance goes unchecked.

Flow is effected when the movement of goods is impeded thereby decreasing the available supply and subsequently having a inflationary pressure on price. If there are less boats and less containers, buying space to transport goods costs more and less goods arrive. If it costs more to transport goods, there’s less of them, and not enough to meet supply. Chances are these goods will go up in price.

Higher spending driven by cheap debt hits lack of supply head on, further increasing prices. Consumers feeling over confident and seeking security, target property, begin to take on more risk and further imbalance the system. House prices skyrocket. Equally, if houses cost to much to buy, people can’t holiday, and debt is cheap, renovation demand increases substantially. Builders and architects get busy, and demand for limited building supplies increases. Thereby the cost of building increases.

The workforce, having had a major covid reality check in regards to work life balance, realise that life is too short. They also notice that their cost of living is rising substantially. Perhaps they notice that they are more important in the businesses where they work, as some staff have left and finding new staff is difficult. All in all they want and need to be paid more. Hello wage inflation.

Businesses facing higher wages, difficulties in getting goods and higher supply costs, have no choice but to increase the price of goods and services. In some cases, these businesses will not be able to operate as their environment becomes unsustainable, resulting in job losses. This free’s up the labour supply, drives further consolidation into stronger business units. Around and around we go…

We live in a dynamic world of rising costs and increasing inequality. There will be winners and losers. Inflationary pressure will become more extreme until the system can calm down and a manageable balance can be restored. The system received a massive shock and it is hurting. It desperately needs to restore the flow of goods and services.

It’s not business as usual. There are limitations as to how much longer this can go on. While we work with reduced supply, we must reduce our consumption. There is a saying by Martin Luther King “if you can’t run then walk.”

Welfare already exists to adjust income to a living wage standard or to provide basic utility. Income is already taxed to adjust disposable income so that the majority remain in a work/consume cycle. So if we assume a reduction in work hours or required work we do not need to assume income or costs remain the same as today. If our income decreased and costs remained the same then the shortfall would be required in the form of tax reductions or universal basic income/welfare adjustments. However, it is possible production efficiencies will result in cost reductions that align with a smaller income. We may earn less but afford the same amount of goods and services.

An alternative reality is the possibility of income staying the same. So we work less but are paid well. Imagine earning the same salary for half the time or effort. In this scenario UBI would not be needed in all cases.

In the case of those who cannot find work then UBI is necessary. We already have this today though.

This is all dependent on the system remaining the same. People need to exchange credits for goods and services and the economy needs people to buy goods and services.

Our obsession with status and consumption will be disrupted by the dematerialisation of goods and services. Digitisation of value and meaning resulting in consumption of non tangible assets. This is an exciting but disruptive challenge to the economic model.

What we are looking at is dominant platforms where users go to transact, exchange and play. Sort of like Facebook, Apple, etc today. These platforms will operate their own credits, coins or currencies. This is next evolution of social platforms whereby VR plays a key role in entertaining otherwise under utilised humans. I think the platforms will pay the users a UBI to engage. Advertisers will pay the platform to reach the users with the hope of selling digital and tangible products and services to the users. Effectively the platforms are taking on the role of a sovereign state.

Capatilism will survive for sometime yet but the gatekeepers will lose control. Big tech will take control of decentralised monetary systems. Banks and even countries will lose control of all forms of exchange.

The emerging reality technologies like VR and AR will drive radical change in terms of tokenisation etc. Legacy environments involving existing gatekeepers will be slow to adapt.

Im expecting AR to emerge for early adopters within the next five years and another five years for it to go more mainstream. So we would be looking at substantial new digital markets before 2030.

The main threat is the dominance of one tech player in terms of controlling the digital eco-system and financial market within that. We need to move forward ensuring that these systems do not create a dystopian top down society. Already social media has shown to design a personalised reality which serves the purpose of advertisers above the user. As the technology becomes all consuming, If this continues to develop in this way, we are heading towards a future where many peoples lives are controlled by a machine.

The fact that some people get paid more than others can be dependent on legacy, smarts, foul play and down right luck. Ultimately, everyone is as important as everyone else to ensure society functions efficiently.

We need work. We may grumble about it, moan about the monotony of it but at the end of the day most of us are routine junkies, craving the importance and achievement work brings us.

Work enables us to exchange responsibility for wants and needs to other people, with the added bonus of specialization. We don’t need to hunt, breed chickens, write books, make iPods, it’s all done for us and by people with much better skills.

In the tribe we become known for being able to do something. People then come to us to get that done. What we do has a market value. We can then use that value to in turn purchase something from others.

Organizations and companies are just groups of people who choose to spend time together with related areas of specialization.

Some people create work that has flexible hours or less hours than others. Some people prefer to work all the time. Some people receive no money for the work they do. All in work benefit the whole.

The rare few have accumulated or inherited excess value. Meaning, they have more value than they need to exchange. These people often do not need to work to produce value for exchange. Naturally, they end up exchanging additional value than is necessary for additionally developed needs and wants. Additionally these people also are great gifters of value and/or work for the fun of it.

Anyone can become someone with excess value. You simply need to exchange less value than you earn on a consistent basis.

Work is not work, work is living.

The point is, what’s more important than how much money you earn is how much money you keep! The world is determined to tempt you into a position of balancing the money you earn and the money you spend. Its a cruel way of keeping us all in a position of financial imprisonment. For example, as your income increasing your ability to purchase increases and there is always an advertised offer masterfully crafted to satisfy the interests of your new found income and status. The majority of us gain skills and wisdom sufficient enough to increase the mountain water, i.e to increase our income. The irony is that as we do we are immediately faced with a whole new set of expense propositions. There are simply many more people and vast resources committed to the goal of making us spend our money. How many people or resources do you know out there helping you to keep and expand the money you have earned? Probably not many.

The end result is that the earnings to spending ratio stays the same regardless of how much money you earn because your mind tells you, hey as long as I don’t spend more than I earn I should be ok. So I can afford the big screen tv, the boat, the use it once a year batch, and the list goes on and on. Ever aimed to arrive somewhere by a certain time, yep your have got it you probably arrived right on time or later than the target time, not early. Its the same with money, when you aim to balance out income and spending we more often than not spend more than we should have.

The reality is that as you get older the scale of this little financial game is increasing, yes the stakes are getting higher buddy. The buy in is going up, the pay back is greater and so is the loss. The house costs, the kids have to be fed and so on. There is nothing left right? It gets harder and harder to break the cycle.

You need to take control before you are locked into the big little life of a balanced financial ratio because this means you are always on the brink of imminent financial ruin. You do not want a balanced financial ratio where income equals costs.

You have been fooled into believing that you should settle for financial survival. Where this whole things collapses is the moment the income pauses or stops. A shuddering thought right. How long could you last? Now the more money you keep the longer you can live in your current lifestyle without the income stream. Perhaps if you are brilliant this would last forever. This is the place where you need to be in your life.

Once you have determined a way to pay yourself first and keep some of the money you earn you need to either store it or transform it. Remember in a previous article that I talked about how money isn’t real? Well this is where it gets really interesting because you can turn the concept of money into something else, something completely different. Because you have kept the money for you, its yours! You control it, you can do whatever you want with it. It is not intended for rent, the mortgage, food whatever. Its yours to put it to work. Twist it, transform it, give it away, turn it into businesses, property, or shares. Transform money into whatever has measurable value, create an ability to produce more value, and make sure you have enough control to transform it back into money again should you need it.

Most of all live well and live now.

In the same vain when stretching ourselves financially the wise investor will implement a period of consolidation. Similarly the creation of long term sustainable organisations is dependent on the careful management of growth and selective balancing of stretching and strengthening activities.