Now that some of the dust has settled around Apple Vision Pro, it is clear that nobody really knows if it is going to work. (Though, it's too expensive and it's too heavy are missing the bigger picture.) It sounds like it delivered what it said it was going to deliver as a product, and the potential is there for a "spatial computing" future. But who knows for sure. Here's an excerpt from an essay that Benedict Evans recently published called, "
Now that some of the dust has settled around Apple Vision Pro, it is clear that nobody really knows if it is going to work. (Though, it's too expensive and it's too heavy are missing the bigger picture.) It sounds like it delivered what it said it was going to deliver as a product, and the potential is there for a "spatial computing" future. But who knows for sure. Here's an excerpt from an essay that Benedict Evans recently published called, "
Second, taking one step further back again, even if my doubts are all wrong, we won’t know any of this for years, and right now this is all still in the experimental category. Apple sells more watches in a typical quarter than Meta has active Quest users. Even the iPhone took years to start selling. It’s possible than in five years this will have started to work, and it’s possible than in five years we’ll have concluded that this [AR/Apple Vision Pro] is a niche, and we’ll have to wait for glasses, contact lenses or neural implants.
But ultimately, this is okay. You have to try, because:
Thank you to Lucas Manuel for sending me the above quote.
Yesterday we looked in the rear-view mirror. Today we're looking forward:
The market consensus right now is that this cycle of interest rate increases has come to an end, and that we should see rates start to come down next year. Having confidence that rates won't go any higher in the near future is what markets need in order to start making more decisions. So this is, of course, positive. At the same time, I don't think anyone should expect a return to ultra-low rates. Rates today are still low when viewed historically.
Lower rates are good for levered assets such as real estate, but I don't think that our industry has fully felt and processed the impacts of higher rates. Unfortunately, I think that things will get worse (in 2024) before they get better (maybe toward the end of 2024 or perhaps in 2025). This is when a "risk-on" approach will return in commercial real estate. A year ago today, I thought 2023 would be the year for this, but as I said yesterday, I was overly optimistic in terms of my timing.
On the residential resale side, I think we will see greater optimism sooner, certainly for the most in-demand cities and areas. There is pent up demand waiting on the sidelines and, once we can get past the current bid-ask spreads and deadlock, I believe we'll return to a more balanced market in 2024. To be clear, I'm not expecting bidding wars and the like. And because of our housing affordability crisis, I also think the Bank of Canada will be more resistant to lowering rates compared to other central banks. This will help the Canadian dollar.
If you're a buyer of real estate, I generally believe that 2024 will turn out to be a pivotal year for you. Roughly speaking, you win acquisitions in one of two ways: either (1) you pay the most or (2) you believe in something that most other people in the market don't. This second approach is harder to achieve in bull markets. But in slower markets, the door is open and history has taught us that it can be the foundation in which great fortunes are made.
As I mentioned yesterday, I agree with the prognostications that hard costs will soften further next year (perhaps even more than 5% on average). Obviously every market is different. But here in Toronto, I just don't see us returning to the level of construction starts that we have seen over the last number of years.
Since 2021, I have used my hyper scientific Jimmy the Greek Reopening Index to keep tabs on office utilization and the overall return to office. And based on this, 2023 was a positive year. Initially, souvlaki consumption appeared dramatically lower on days like Monday. But I noticed discernible increases as the year went on. However, if you look at actual data, such as what we have from swipe cards, the great return to office seems to have stalled out at around 50%. I don't think this will hold, though. I continue to believe that of the people who work in offices, most will spend > 50% of each week there. And we will see that in 2024.
2023 was the year of AI. But Fred Wilson makes an excellent point, here. AI is 40+ years in the making. Last year only became the year of AI because a consumer-facing app -- ChatGPT -- was revealed that captured everyone's attention. Crypto will eventually have this moment, but it will likely need to marinate a bit longer. Instead, I think 2024 will be the year of augmented reality (AR) and a further blurring of our offline and online worlds. Think digital art, fashion, and other collectibles (such as NFTs).
Right now, autonomous vehicles feel like they're in the trough of disillusionment (within the hype cycle). There were moments last year where it felt like we were finally moving beyond this phase. But then some very suboptimal things happened. I think AVs are our reality in the next 5+ years, which means that for next year we likely want to be focused on the inputs: vision/LIDAR, battery tech, etc.
Zooming out, we should be thinking about the above two trends in the context of a broader shift toward greater automation. I think it will feel more insidious than immediate (certainly in 2024), but the longer-term impacts are going to be profound for our society. The so-called gig economy is likely to be impacted first. Eventually the overall economy will create new jobs, but we are still going to need to manage this transition toward more automation.
TikTok Shop is where to look for the future of shopping. I think the platform will continue to see strong adoption and ultimately prove to be a dominant e-commerce platform throughout 2024. Amazon, Meta, and others will see this, and try their best to catch up and copy it.
At the time of writing this post, the total crypto market capitalization is about $1.74 trillion. This is down from nearly $3 trillion at the peak of the market in 2021. The recent gains suggest that the so-called "crypto winter" might be over, and so combined with lower interest rates and more real-world use cases, I think that 2024 will be another strong year for crypto. Total crypto market cap at the end of the year will exceed its 2021 peak.
And there you have it. My current thoughts for this upcoming year. I should note that I'm not an economist, analyst, or an expert on souvlaki demand for that matter. But I enjoy writing this post as an annual discipline. It forces me to think critically about the topics that interest me. And in the paraphrased words of Howard Lindzon, it gives me an archive that I can go back to and either cringe at or think to myself, "hey, I could have been a somebody!"
And with that, a big thanks to everyone who has read this daily blog over the last year. This year marked its 10th anniversary. I wish you much success and happiness in 2024. Happy new year!
Second, taking one step further back again, even if my doubts are all wrong, we won’t know any of this for years, and right now this is all still in the experimental category. Apple sells more watches in a typical quarter than Meta has active Quest users. Even the iPhone took years to start selling. It’s possible than in five years this will have started to work, and it’s possible than in five years we’ll have concluded that this [AR/Apple Vision Pro] is a niche, and we’ll have to wait for glasses, contact lenses or neural implants.
But ultimately, this is okay. You have to try, because:
Thank you to Lucas Manuel for sending me the above quote.
Yesterday we looked in the rear-view mirror. Today we're looking forward:
The market consensus right now is that this cycle of interest rate increases has come to an end, and that we should see rates start to come down next year. Having confidence that rates won't go any higher in the near future is what markets need in order to start making more decisions. So this is, of course, positive. At the same time, I don't think anyone should expect a return to ultra-low rates. Rates today are still low when viewed historically.
Lower rates are good for levered assets such as real estate, but I don't think that our industry has fully felt and processed the impacts of higher rates. Unfortunately, I think that things will get worse (in 2024) before they get better (maybe toward the end of 2024 or perhaps in 2025). This is when a "risk-on" approach will return in commercial real estate. A year ago today, I thought 2023 would be the year for this, but as I said yesterday, I was overly optimistic in terms of my timing.
On the residential resale side, I think we will see greater optimism sooner, certainly for the most in-demand cities and areas. There is pent up demand waiting on the sidelines and, once we can get past the current bid-ask spreads and deadlock, I believe we'll return to a more balanced market in 2024. To be clear, I'm not expecting bidding wars and the like. And because of our housing affordability crisis, I also think the Bank of Canada will be more resistant to lowering rates compared to other central banks. This will help the Canadian dollar.
If you're a buyer of real estate, I generally believe that 2024 will turn out to be a pivotal year for you. Roughly speaking, you win acquisitions in one of two ways: either (1) you pay the most or (2) you believe in something that most other people in the market don't. This second approach is harder to achieve in bull markets. But in slower markets, the door is open and history has taught us that it can be the foundation in which great fortunes are made.
As I mentioned yesterday, I agree with the prognostications that hard costs will soften further next year (perhaps even more than 5% on average). Obviously every market is different. But here in Toronto, I just don't see us returning to the level of construction starts that we have seen over the last number of years.
Since 2021, I have used my hyper scientific Jimmy the Greek Reopening Index to keep tabs on office utilization and the overall return to office. And based on this, 2023 was a positive year. Initially, souvlaki consumption appeared dramatically lower on days like Monday. But I noticed discernible increases as the year went on. However, if you look at actual data, such as what we have from swipe cards, the great return to office seems to have stalled out at around 50%. I don't think this will hold, though. I continue to believe that of the people who work in offices, most will spend > 50% of each week there. And we will see that in 2024.
2023 was the year of AI. But Fred Wilson makes an excellent point, here. AI is 40+ years in the making. Last year only became the year of AI because a consumer-facing app -- ChatGPT -- was revealed that captured everyone's attention. Crypto will eventually have this moment, but it will likely need to marinate a bit longer. Instead, I think 2024 will be the year of augmented reality (AR) and a further blurring of our offline and online worlds. Think digital art, fashion, and other collectibles (such as NFTs).
Right now, autonomous vehicles feel like they're in the trough of disillusionment (within the hype cycle). There were moments last year where it felt like we were finally moving beyond this phase. But then some very suboptimal things happened. I think AVs are our reality in the next 5+ years, which means that for next year we likely want to be focused on the inputs: vision/LIDAR, battery tech, etc.
Zooming out, we should be thinking about the above two trends in the context of a broader shift toward greater automation. I think it will feel more insidious than immediate (certainly in 2024), but the longer-term impacts are going to be profound for our society. The so-called gig economy is likely to be impacted first. Eventually the overall economy will create new jobs, but we are still going to need to manage this transition toward more automation.
TikTok Shop is where to look for the future of shopping. I think the platform will continue to see strong adoption and ultimately prove to be a dominant e-commerce platform throughout 2024. Amazon, Meta, and others will see this, and try their best to catch up and copy it.
At the time of writing this post, the total crypto market capitalization is about $1.74 trillion. This is down from nearly $3 trillion at the peak of the market in 2021. The recent gains suggest that the so-called "crypto winter" might be over, and so combined with lower interest rates and more real-world use cases, I think that 2024 will be another strong year for crypto. Total crypto market cap at the end of the year will exceed its 2021 peak.
And there you have it. My current thoughts for this upcoming year. I should note that I'm not an economist, analyst, or an expert on souvlaki demand for that matter. But I enjoy writing this post as an annual discipline. It forces me to think critically about the topics that interest me. And in the paraphrased words of Howard Lindzon, it gives me an archive that I can go back to and either cringe at or think to myself, "hey, I could have been a somebody!"
And with that, a big thanks to everyone who has read this daily blog over the last year. This year marked its 10th anniversary. I wish you much success and happiness in 2024. Happy new year!
And even though I've been mostly disconnected, it has been hard not to miss the hype around the new Apple Vision Pro, which was released into the wild this week. I haven't tried one yet, but every review that I have read or watched seems to come to the same general conclusion: "Wow, this thing is incredible. It feels like a glimpse into the future of computing."
If you're looking for a comprehensive technical overview of the device, you should check out Marques Brownlee's video, here. But if you're just looking to get a sense of what it might be like to, you know, wander around New York City wearing one, you should definitely check out Casey Neistat's video, here.
Now I think there's no question that there's a dystopian element to all of this. When Casey is standing around and watching a butterfly eat his donut, he looks pretty strange from the outside. Only he is seeing the butterfly. But then again, we all look pretty weird standing around staring down at our phones all the time. Maybe this will help us become less disconnected. I don't know.
Either way, it's hard not to imagine this changing -- a lot. I mean, here's just one small example. Already Zillow has an app for Vision Pro that allows you to tour homes for sale. Assuming it's as good as everyone says it is, I can't imagine anyone going to physically tour a home ever again, unless they're really serious and/or ready to put in an offer.
Of course, there's also no shortage of people saying that this device is simply too expensive. But I think that misses the point. This is version one. At this point, Apple just needs to be directionally right about what they are calling "spatial computing." (They don't want you to call it VR.) Because if they are right, the price will come down and then we'll all be watching old Bond movies on these devices.
And even though I've been mostly disconnected, it has been hard not to miss the hype around the new Apple Vision Pro, which was released into the wild this week. I haven't tried one yet, but every review that I have read or watched seems to come to the same general conclusion: "Wow, this thing is incredible. It feels like a glimpse into the future of computing."
If you're looking for a comprehensive technical overview of the device, you should check out Marques Brownlee's video, here. But if you're just looking to get a sense of what it might be like to, you know, wander around New York City wearing one, you should definitely check out Casey Neistat's video, here.
Now I think there's no question that there's a dystopian element to all of this. When Casey is standing around and watching a butterfly eat his donut, he looks pretty strange from the outside. Only he is seeing the butterfly. But then again, we all look pretty weird standing around staring down at our phones all the time. Maybe this will help us become less disconnected. I don't know.
Either way, it's hard not to imagine this changing -- a lot. I mean, here's just one small example. Already Zillow has an app for Vision Pro that allows you to tour homes for sale. Assuming it's as good as everyone says it is, I can't imagine anyone going to physically tour a home ever again, unless they're really serious and/or ready to put in an offer.
Of course, there's also no shortage of people saying that this device is simply too expensive. But I think that misses the point. This is version one. At this point, Apple just needs to be directionally right about what they are calling "spatial computing." (They don't want you to call it VR.) Because if they are right, the price will come down and then we'll all be watching old Bond movies on these devices.
Share Dialog
Share Dialog
Share Dialog
Share Dialog
Share Dialog
Share Dialog
