So Bitcoin apparently is either the new thing or the next Tulipmania.
To be fair, I do not understand Bitcoin, or cryptocurrencies in general. I read a bit on Blockchain today and maybe think I get that, but maybe not. I read up on Cryptocurrencies as well - sadly, again not getting it.
I am not overly concerned about it, of course - I went through my "get rich quick" phase 13 years ago and after missing out on the real estate boom (and bust), have pretty much relegated myself to the world of save and invest - not just in stocks and bonds, mind you. Land and the ability to provide food have value as well.
I understand the attraction, of course: skyrocketing value, non-governmental control (a big plus for me), and the ability to "earn" (apparently) on your own (e.g. "mining"). And apparently it is becoming a thing because more and more businesses are accepting them, which suggests that it is a trend to stay.
In moments like these, I always bear in mind Warren Buffet's advice: "Do not invest in anything you do not understand". Which sounds pedestrian, I know. But I would rather be pedestrian and keep my smaller gains than be cool and lose larger ones. I tried that, once.
Never again.
My kids were into Pokemon cards and Pogs at one time. They'd come up to me and say "This one's worth $100.00!" "This one's worth $200.00!" Then my kids, and everyone else's kids, moved on to other things. Those megabuck Pokemon cards and Pogs ended up in drawers, under the beds, and ultimately, in the trashcan.
ReplyDelete...I see Bitcoin as the digital versions of these...
I have been watching it like a hawk. Seeing as how nobody was kind enough to ask me for a loud and uninformed opinion - I shall provide it, free of charge:
ReplyDeleteIf I understand it correctly you and I can do business right over the internet with it, and cut out any number of gubbimint/tax/banker/money-changer slobs who usually get in the middle of such things for a tidy profit.
Cutting guys like that - out of anything - seems to be a very risky thing to do. I strongly suspect that Bitcoin and the people that use it are going to have some unfortunate accidents right away, if ya catch my drift.
Hope I'm wrong of course.
Pete - One of the great lessons I learned from real estate - maybe the only useful one, except how to lose a whole lot of money very quickly - is that the value of something is only what someone will give, not what you think it is.
ReplyDeleteBitcoin is a little more technologically advanced than pogs and Pokemon of course, and I vaguely get the security aspect, but I do not understand how it serves as a measure or store of value. Maybe I am just too dense for the concept.
I think in theory you are right, Glen - but as you say, the government and banks will very soon figure out a way to cash in on it, at which point it may become nothing more than an encrypted version of Paypal.
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