On July 27, 2017, I wrote a blog trying to tell my followers about the difference between speculation and investing. Nothing has changed. What has changed is that the wonderous and mysterious Bitcoin has increased from a paltry $2500 (considered insane then) to over $11,000 USD today.
I have had some people continuously remind me of this (some give me daily reminders …mostly in good fun) and I guess they are going easy on me for all my other correct bi-annual predictions. What has also changed are the bullish predictions that keep getting revised. I heard this morning $100,000 USD.
As a road map, I can only go by what I have seen over a 30-year tenure in the financial markets. Being no stranger to risk, as I started in the Chicago Mercantile Exchange pits…and seeing more than my fair share of speculative tops and bottoms, I can tell you the signs are there.
Astronomic price predictions
$100,000 USD on an entity that is designed to avoid mainstream financial instruments, yet still wants to be converted to mainstream financial measure. Really?
Participants who don’t belong in this class and the marketing to these participants
This is a tell-tale sign. The John Q. Public has been heavily touted and marketed to at a rate that I call unprecedented. The additional / alternative crypto currencies that came in to supplement these are now so many that no-one can keep track. People figure, I missed the Bitcoin, so let me go to one of the others…they have to go the same way!
I promise you, when I was at a brunch last week and a teacher who has no other investments in her life said she put in $100, I knew we are so close that it hurt. She wanted to put in just a little to be conservative. Can the words “Bitcoin” and “conservative” actually go into the same sentence?
My wife wants me to put in money…now I really know Bitcoin is in trouble. She is the most conservative person I know.
So the future?
Knowing what I know (and it isn’t much about the actual vehicle since no-one to this day can actually explain it to me), I still wouldn’t buy it with the benefit of hindsight. I congratulate my friends that did, but I have to trust what I learned in my many years. I hope it does keep going up for ever. Just remember it’s not yours until you sell. If it does keep going up it just means there is still hope to find that Unicorn store I have been looking for, for my niece’s Christmas present.