At the annual shareholders meeting in the passing weekend, the vice chairman of Berkshire Hathaway, Charlie Munger, lashed out at Bitcoin again and called it disgusting. I guess I cannot expect too much from a nearly 100 years old man, who is very wise in investing but oftentimes very dumb about new technology and innovations. Just google to see what he said about the Internet back in the early 90s. Something similar to the effect that the Internet just made people feel good but wouldn't have utility and anything good for society at all!
Anyway, after laughing at the ignorance, I think the two questions below are the most asked ones and I have seen the good answers to them. So just share with you. Of course, if you agree with Munger, just pass it.
But let me first share some interesting utility of the joke coin, Dogecoin that I just saw:
We saw that this week when Major League Baseball began selling tickets for Dogecoin (DOGE).The Oakland A's Completes First Ever Dogecoin Transaction
Yesterday, the Oakland A's announced they are selling two-seat pods for 100 Dogecoin (DOGE).
President Dave Kaval tweeted about it, take a look:
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Won't the government just outlaw crypto?
This is perhaps the No. 1 question I get.
It could. But it won't.
To be frank, the government can outlaw anything it wants. It's certainly tried. But it seems to be ever so slowly learning its lesson that prohibition of things the people want is a bad idea.
So far, several countries have tried to pinch crypto usage, and they've failed. In fact, the only thing they've seemed to do is push demand higher and raise prices even further.
But here's what most folks who ask that question fail to consider...
Very few cryptos are actually working to replace the dollar. The very best coins have real-life functions. They create ways to swap critical data. They allow machines to talk to each other. And they keep contracts honest and unchangeable.
The government has no need or intent to outlaw such useful things.
In my off-centered opinion, it will ban books before it bans crypto. But keep that to yourself... We don't want to give it any ideas.
Aren't cryptos just like buying tulips during the tulip mania?
Nope. At least not with the good cryptos.
The tulip mania was complex - much more complex than how folks talk about it today. But it was largely caused by derivative contracts and the leverage that comes with them.
With many of the contracts, nothing physical was backing them. They'd trade hands, and few folks ever took delivery. The tulips were merely the symbol behind the speculation. The real speculation was finding a fella to sell your contracts to.
If anything, it was more like the 2008 housing mess than what we're seeing with cryptos.
Again, good cryptos are actually backed by some utilitarian purpose. They're doing something and have some intrinsic value. Those are the ones you want, and there are plenty of them.
Stick to those... and don't let unfounded comparisons keep you out of a strong moneymaking opportunity.
By Andy Syder
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