Archive for the ‘Economics’ Category

I hate to say I told you so….OK maybe I don’t.

I warned about Bit Coin but did you listen?  Some of you didn’t and got burned.  I said it would drop and it did.  It is now around $6,000.  That’s even lower than I predicted. So…how much did you lose by believing all the hype?

So did you buy Bitcoin when it reached $18,000

If you did I’m sure you are crying in your beer today. I tried to warn you when it reached $10,000 but did you listen? Noooo!
OK, I said this was all speculation and the bitcoin had no value or support by any entity behind it. The only thing driving the price up was greed. I still think that it will drop back low, probably less than $5,000 since there is nothing to support it. Just now it is about $12,450 down 20% for the day, but people are still buying it. It may end up higher at days end but I would consider that as a “dead cat bounce”. That means that after falling so low that even a dead cat will bounce higher after the fall.

So good luck to all you speculators out there. Me, I’ll keep being a value investor, won’t get rich quick, but won’t take a fall either.

Big Box Mart

If you want to see a humorous video of why we are in the economic shape we are in with trillions in national debt you have to check out this video from JibJab

 

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So the Bit Coin broke the $11,000 barrier

I am of the opinion that the Bit Coin will crash and burn.  Yes I’ve been saying it for a couple of years now ever since it was less than 10% of its current value but that does not make me wrong.  Of course time will tell but I am thoroughly convinced.  The rise of the value of Bit Coin is directly related to speculation and has nothing to do with its intrinsic value which is zero.  It is a made-up currency with no basis in value and nothing backing it up.

You may argue that the dollar is basically a made up currency with no value since we left the gold and silver standard. True, however it is backed by the full faith and credit of the government of the United States.  Who backs up the Bit Coin?  Nobody.

My premise is based upon the Tulip Bulb. Another speculative buy that caused a financial crises in Holland many years ago.  The price of a single bulb speculatively increased until it would trade for an exorbitant amount.  Suddenly it fell to almost nothing.     If you don’t know what I am talking about visit this link  http://www.thebubblebubble.com/tulip-mania/  This is a well written explanation of the crises.

 

As I see the current economic situation

Economic factors affect every day of our lives.  Unfortunately there are times when we ignore the socioeconomic factors that result in hardship to our everyday lives.  Political, social, and economic decisions that our governments take all the way from our local authorities to the federal government in Washington affects us in so many ways that many of us just ignore.  I do not know what it will take to have the citizenry wake up and take back the political process that the major political parties have taken away from us.

The United States was at one time the most powerful economic force in the world.  We are quickly becoming a third world state and it is entirely our fault.  i have my thoughts and opinions and I would like to know yours.