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Comment by highwaylights | Hacker News Reader

$420.69 million dollar round. 69 investors (one of whom was the Ontario Teachers Pension Plan - one of the largest retirement funds in Canada).

When I think "prudent retirement planning based on low risk, sound long-term principles" I think of a group of bros giggling at how many weed and sex references they could jam into their sales pitch.

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This is very disturbing. It's people's retirements plans they are gambling with (yes, crypto is gambling). Similarly Quebec's Caisse de dépôt invested in now bunkrupt Celsius.

Such is life when you're forced to buy negative yielding bonds from the government and still get a return for your investors.

I mean, the issue is that positive yield bonds exist… like, why is the government just printing money?!

The only correct risk-free interest rate is 0%. Wanna return? Invest and risk!

Bonds aren’t risk free. Just asking holders of Argentina’s.

Well, yes. That's why bonds have a positive and also variable yield. I guess the parent poster doesn't understand the difference between yield and coupon.

sigh Whether the bonds have a positive yield and how currency is issued have no relation. There have been plenty of positive yield bonds during the gold standard. Indeed, "hard money" standards tend to make borrowing at high interest rates more necessary.

This is like the bizarre argument sometimes made that hard money will end war; that's not how it works. The war will happen anyway and a means will be found to pay for it. Gold was heavily used as an inter-governmental currency in WW2 - resulting in a few very expensive shipwrecks.

Don't tell me they exhausted all the investment opportunities and crypto was their only choice. They could as well put the money into 1000 random start-ups and be better off risk wise

Obviously there were other choices. But large investment fund managers now mostly operate on the FOMO principle. They don't want to look stupid by missing out on the next big thing. But if they take a loss then they can explain it away because "everyone else was doing it".

At a more fundamental level, this is just another example of the principal-agent problem. Pension fund managers optimize for their own careers rather than for the financial health of retirees. This is one of the reasons why all defined benefit pension plans should be eliminated and replaced by defined contribution plans.

"Nobody gets fired for buying IBM"

This is the "r > g" problem. It's not guaranteed that there can be a positive real return on investment in the physical world.

Jeez that’s shameful. What kind of capital management system lets crypto within 100 miles of a pension plan.

I think we need to have a serious discussion about wealth caps. The last couple weeks have made it absolutely undeniable that wealth is not in any way correlated with being capable of using it well. No single person should have that much influence over that many resources.

When money can be printed, you should expect most wealth to flow to people who get closer to the money printer.

When money can’t be stolen and can only be created by means of enormous effort, money should flow to those capable of maximally converting human effort into positive emotional responses.

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