As I study the dominant companies in the "digital real estate" world, I am increasingly impressed by how different these companies are than those I have studied for the past decades. Much has been written recently about the hazards of investing in companies with such sizeable market caps. The price declines in Alibaba (BABA) are sometimes used as a warning. Yet my studies of BABA reveal the same powerful difference at work. The key here is how I might characterize this difference.
My first attempt was to call it "digital real estate." As the "metaverse" develops, an effort is being generated so that a seamless transition works between analog and digital, but that model has some difficulties. The analog world is clearly limited and finite, while the "digital" repurposes and can expand as necessary. In this sense, there is an analogy of the mind-body problem in which the body is finite and limited and moves forward through time while the mind is changeable, unlimited and moves backwards and forwards through time.
If there is an analogy here for the "mind," what then is a way of thinking about a collective "mind"? It seems to me that one real useful reference is our legal system. The legal system is a mental and collective construct that allows for and dictates the allocation of analog assets. If this analogy is true, and I think it is, then the question would logically follow - what is the investment price that I would pay for a piece of our legal system? In that sense, I think it also follows why buying the Western greats such as GOOG, FB, MSFT and AMZN works compatibly with owning the Eastern greats. It also points out the necessity for regulatory action which simply enfranchises and functionalizes these "digital real estate" companies.
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