Below The Fold

Below The Fold

“Coinbase Opens at $381 in Volatile Market Debut. Should You Buy the Stock?,” Bloomberg wondered Wednesday, on your behalf.

By 3 PM on Wall Street, it was trading well below the opening price. The shares made it all the way up to $429.54. At one point, Coinbase’s valuation was $112 billion. For context, it was valued at $8 billion as late as 2018. That’s a subtle way of suggesting the shares could be expensive.

The irony is always the same, though. Those who cite all the speculative manias they’ve seen in their careers while railing against current manifestations of market froth accidentally suggest they didn’t learn the only lesson worth learning — namely (and colloquially) that if something looks stupid, chances are it will get infinitely stupider before it collapses.

That’s true whether you’re talking about long-running bull markets or short-lived bouts of abject insanity. Those “old” enough to remember GameStop will recall that it was an absurd proposition at $50. At $100 it was ludicrous. At $200 it was madness. At $400 it was a suicide mission. Hilariously, the company is now swept up in the reality distortion loop, and it’s starting to become self-fulfilling. With an announcement to redeem more than $215 million in senior notes, GameStop is poised to be debt-free. “Wow, what a difference!” (Some of you will get the joke.)

In any case, I’ve delivered my opinion on Coinbase several times. I recapped it prior to the first-day fireworks. By Wednesday afternoon, market participants were already getting a taste of how the stock could become a sentiment bellwether. “A sharp selloff off the highs in Coinbase following its initial open could have triggered a selloff in the Nasdaq 100,” Vincent Cignarella mused.

All you can do is shake your head. And buckle up.

Goldman rose more than 2% after delivering a blowout quarter. JPMorgan didn’t fare so well. The shares dropped despite solid results.

If you’d be inclined to say it’s uncouth and totally ridiculous to debate the merits of an investment thesis in a company dedicated to the exchange of digital tokens before mentioning Afghanistan, I’d agree. But I’ll be guilty of it here to make the point: That’s the kind of world we live in. Coinbase is above the fold. An exit from America’s longest war isn’t guaranteed top billing. Not if Bitcoin has anything to say about it.

“It is time to end the forever war,” Joe Biden told America Wednesday. All US troops will leave the country by September 11. Biden tried to put a positive spin on the situation. “War in Afghanistan was never meant to be a multigenerational undertaking,” he said. “We were attacked. We went to war with clear goals. We achieved those objectives.”

That’s actually true. The problem was never whether the US military could achieve the initial objectives — i.e., toppling the Taliban and disrupting al-Qaeda’s base of operations. The question was whether the effort would dead end in an intractable quagmire. Ultimately (and unsurprisingly), it did.

Nation-building is hard enough when it’s your own nation. Trying to help other nations do it after you’ve laid waste to them is well nigh impossible. America never seems to learn that and probably never will. Indeed, there’s something nonsensical about the idea that one country can engage in “nation-building” on behalf of another. “Nation-building” means more than just establishing a legislature and installing a puppet executive. What America did in Iraq and Afghanistan was more like colonialization without any of the benefits — imperialism that actually cost money, as opposed to delivering an economic windfall.

Transplanting democracy and constructing the institutions to make it durable are almost never the stated objective, but mission creep is inevitable. The justification is that absent a stable democracy, the threat remains. Stability proves elusive, and the US is left with a kind of “you broke it, you buy it” situation. The populace, while sometimes jubilant and cooperative in the early stages, eventually becomes weary of an occupying force walking around with guns all day. As the local death toll mounts, public opinion sours and an otherwise receptive citizenry begins to ponder whether they were better off before.

Biden “made only passing mention of the other objectives that were added to the mission over the years and that came to justify the continued American military presence,” the Times wrote. “That included building a stable democracy, eradicating corruption and the drug trade, assuring an education for girls and opportunity for women, and, in the end, creating leverage to force the Taliban into peace negotiations.”

What struck me Wednesday was that while, like most readers, I can recall voluminous details about where I was, who I was with and what I said the morning the Towers fell, America’s youngest adults weren’t even born on 9/11.

Biden said he spoke to both Barack Obama and George W. Bush about the decision. “I am now the fourth American president to preside over an American troop presence in Afghanistan. Two Republicans. Two Democrats,” Biden told the country. “I will not pass this responsibility on to a fifth.”


8 thoughts on “Below The Fold

  1. We’ll have time at some point to say how right we all were back then when the crash and subsequent depression do occur. In the meantime, enjoy the good times and make hay. (The alternative is a crash and subsequent depression.)

  2. Afghanistan:

    “The problem was never whether the US military could achieve the initial objectives — i.e., toppling the Taliban and disrupting al-Qaeda’s base of operations. The question was whether the effort would dead end in an intractable quagmire. Ultimately (and unsurprisingly), it did.”

    There was an all too prescient comment from a Soviet general who had fought the Taliban back when the US, Pakistan & Saudi Arabia supported them. Remember that? He said something to the effect that “We were unable to win even though we paid no heed to “little niceties” like limiting civilian casualties. The US has no chance.” Sad but true, eh? *

    *I recall that I was able to access the actual quote once, so it’s not an imaginary bit of fluff. Perhaps from a memoir penned in 2012.

    1. He said something to the effect that “We were unable to win even though we paid no heed to “little niceties” like limiting civilian casualties. The US has no chance.”

      1- the USRR did pay heed to civilian casualties. They didn’t engage in genocide, after all. Not even of ‘just’ the Pashtun. Presumably, that would have ‘won’ the war.
      2- the USA doesn’t pay nearly as much heed to civilian casualties as it’d like to think and the rest of the world has noticed.

      Since we’re amongst adults, I’ll point out that, to me, a foreign observer, it seems the USA has mostly forgotten or, better, forgiven itself about its war against Iraq. I can assure you the rest of the world isn’t being nearly so forgiving/forgetful. The damage of surrounding the moral high ground is still playing out. It gives every instance of “whataboutism” by China or Russia its punch.

      Even after all of US foreign errors and crimes, I’d rather have you controlling the Pacific trade routes rather than China. I suspect many local countries, from Vietnam to Japan to NZ, would agree. Yet, China or North Korea can justify all kinds of aggressive moves under the cloak of defending against the possibility of regime change and foreign undermining and it’s an effective argument… We can all thank GWB and Cheney for that…

  3. Far more effective and long lasting to legalize/regulate drugs and treat drug addiction as a health issue in the US.
    We should also reallocate US budget related to the the Middle East to developing safe nuclear power and take oil off of the table.
    Win, win, win.

  4. The US won’t publicly admit to taking an “L”, just like the proud British and Soviets before them. Nevertheless, the Taliban is alive and well, in control of lots of territory, and surely as embittered as ever. We could mention the several trillion spent, but the worst consequence by far was trading in the 4th Amendment in the name of it all. I recommend this piece for a view into reality on the ground and for what the future holds, “After America: Inside the Taliban’s New Emirate”: https://newlinesmag.com/reportage/after-america-inside-the-talibans-new-emirate/

    For those who enjoy irony, it could be noted that the Empire was really fighting two Opium Wars simultaneously on two different fronts: one over 20 years that failed to tame the Taliban and its core industry now centered around Sangin, and another that succeeding spectacularly as designed and waged by Big Pharma and its McKinsey consultants against its very own domestic population. One might say there’s an analogy in there for how, and for whom, the entire economic system works in reality.

  5. Thank you Anaximander for a very interesting article. The poor Afghan people have been used by everyone since 1976. Initially, by the US, using the warlords to fight the Russian occupation, then the Taliban to get rid of the warlords, then the warlords again to get rid of the Taliban and Al Qaeda, then again to get rid of the occupation by us. I hope they find peace soon, but, in this case, unfortunately, my glass is half-empty

  6. A chapter on Afghanistan will feature prominently when “The Rise and Fall of the American Empire” is written, along with the contested if not stolen election of 2000 where the popular vote winner was denied the presidency in a so called democracy where 50%+1 is supposed to be the norm, massive budgetary surplus laid waste to endless wars based upon lies and greed instead of peaceful economic world development and cooperation…doubt the rise of BTC, Coinbase, etc will provide much solace worldwide and among the tent cities Mr Powell notices on his way to work…

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