An Economy Built on Speculation—for Better and for Worse

SPEAKER_1 (0:00)

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Mike Winkleman (0:15)

Either this is a bubble, or I am going to be a f***ing trillionaire. Like, there's no two ways about it.

Katherine Sullivan (0:23)

Imagine if one day, your side hobby suddenly became something that people started spending millions of dollars on. That's basically what happened to Mike Winkleman.

Mike Winkleman (0:33)

And it was just like, wait, what? Like, people are paying, collecting JPEGs? Paying money for JPEGs?

Katherine Sullivan (0:41)

Like... Winkleman is a 44-year-old father of two originally from Wisconsin. He started making digital art in 1999, when he was a freshman in college, long before something called an NFT existed. The JPEG files he made on his computer were never something he thought would make him rich. Was it something that you thought you would make a living on?

Mike Winkleman (1:03)

No, 100% not. It wasn't something I saw any way of making a living on.

Katherine Sullivan (1:08)

But Winkleman kept at it for the next 20 years, working in web and graphic design, while making art on the side as a passion project, under the name Beeple. His images were surreal, futuristic, and irreverent, often depicting people and themes from news and pop culture. He gained a big and loyal online following. But like he expected, he wasn't making any real money on his art. It was just hard to find ways to monetize it. Until, all of a sudden, it wasn't.

This is a story about how Americans, for centuries, have been caught up in the throes of speculation. For better and for worse. It's Sunday, October 19th. I'm Katherine Sullivan for The Wall Street Journal. This is USA250, a podcast series connecting America's economic present to its past. We'll be occasionally dropping in to your What's News feed over the next year, with stories that interrogate, celebrate, and make sense of our history. This is episode one, An Economy Built on Speculation. From the Robinhood trading app to meme coins to the stock market's rally on AI, it seems like a lot of people are taking risky, speculative bets. Those kinds of bets throughout our history have helped shape our present, and they'll continue to shape our future. I'm on a journey to understand speculation's role in American history, where it's taken us, and where we're going. Mike Winkleman started getting messages from his social media followers in 2020 during the COVID pandemic.

Mike Winkleman (2:50)

My sort of like followers and sort of like friends and stuff kind of been like, have you, what is this like NFT thing? If you like, look at this NFT thing. I was like, I don't think that does not have anything to do with like what I'm doing. I remember looking at it and being like, I do not get this at all. This is some weird crypto thing. Like I'm not into crypto.

Katherine Sullivan (3:09)

You might know a lot about non-fungible tokens, or you might know very little. Basically, anything real or digital can have a corresponding NFT created for it. It's a unique identifier like a barcode certifying ownership and authenticity. And it's recorded on the blockchain, a public permanent digital ledger showing ownership. Winkleman had been trying to break into the mainstream art market for a while, but it was proving tough. There just wasn't much space for a digital artist. After talking to some other people about what NFTs were and how they could be used, something clicked.

Mike Winkleman (3:44)

I was like, wait a second. This could be that moment for digital art where it becomes recognized as a real sort of like part of art.

Katherine Sullivan (3:55)

Winkleman stopped doing his commercial design work and went all in on marketing his digital art as NFTs. It didn't take long for him to see returns. His first few pieces sold right around the time of the 2020 election. After the election, one of them was revealed to be an animated image of people calmly walking down a sidewalk, while a massive, graffitied carcass looking eerily similar to Donald Trump lay in the grass behind them, with birds flying around it. It sold for $66,666.

And it wasn't just Winkleman or Beeple making lots of money.

Mike Winkleman (4:29)

It was like all of my friends suddenly were making like hundreds of thousands of dollars and then suddenly some of them started making sort of like low millions of dollars on things. And so it was just like, what the hell is going on? This is just insane.