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Collapse of FTX crypto Bank....a Lehman Moment?

Discussions about the economic and financial ramifications of PEAK OIL

Re: Collapse of FTX crypto Bank....a Lehman Moment?

Unread postby Outcast_Searcher » Tue 17 Jan 2023, 01:11:51

careinke wrote:Gold has basically kept up with inflation at todays prices. The S&P, if it just kept up with inflation would be at $588.53. Congrats!

I bought Bitcoin at $400.00 in 2014 with the cumulative inflation rate being 23.6% my BTC would be $494.48. Right now BTC is $19,953.00 and rising. I win!!!

Seems the real loser is the US dollar...

Peace

Get back to us re crypto in a meaningful time frame for investments, like several decades.

Stocks, like the S&P 500, have a total nominal return of about 10 percent compounded annually over the past 90+ years (the index doesn't include dividends), and generally over any 3+ decade timeframe during that. Call it a 6 to 7 percent inflation adjusted compounded annual return. For something so simple and reliable over time, that's MASSIVE. And for those who hate taxes, buying something like a Vanguard S&P 500 index return, it can be VERY tax efficient. For a two-ish percent dividend (close to the long term average) and a moderate tax rate like 25%, that's only about an annual 0.5% ongoing tax payment on the capital to buy and hold it, until it gets sold.

BTC is under a third of where it was at the recent high just 4 months ago. You want a large part of your portfolio in something that volatile and unreliable? You could also "invest" in lottery tickets or going to Vegas.

And yes, clearly sticking fiat in a mattress or a safe deposit box or backyard garden hole is NOT a good investment over any meaningful time-frame. As volatile as it is, at least something like gold will tend to keep up with inflation over the long run, like it has the past several hundred years.
Given the track record of the perma-doomer blogs, I wouldn't bet a fast crash doomer's money on their predictions.
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Re: Collapse of FTX crypto Bank....a Lehman Moment?

Unread postby careinke » Tue 17 Jan 2023, 02:02:51

Outcast_Searcher wrote:
careinke wrote:Gold has basically kept up with inflation at todays prices. The S&P, if it just kept up with inflation would be at $588.53. Congrats!

I bought Bitcoin at $400.00 in 2014 with the cumulative inflation rate being 23.6% my BTC would be $494.48. Right now BTC is $19,953.00 and rising. I win!!!

Seems the real loser is the US dollar...

Peace

Get back to us re crypto in a meaningful time frame for investments, like several decades.

Stocks, like the S&P 500, have a total nominal return of about 10 percent compounded annually over the past 90+ years (the index doesn't include dividends), and generally over any 3+ decade timeframe during that. Call it a 6 to 7 percent inflation adjusted compounded annual return. For something so simple and reliable over time, that's MASSIVE. And for those who hate taxes, buying something like a Vanguard S&P 500 index return, it can be VERY tax efficient. For a two-ish percent dividend (close to the long term average) and a moderate tax rate like 25%, that's only about an annual 0.5% ongoing tax payment on the capital to buy and hold it, until it gets sold.

BTC is under a third of where it was at the recent high just 4 months ago. You want a large part of your portfolio in something that volatile and unreliable? You could also "invest" in lottery tickets or going to Vegas.

And yes, clearly sticking fiat in a mattress or a safe deposit box or backyard garden hole is NOT a good investment over any meaningful time-frame. As volatile as it is, at least something like gold will tend to keep up with inflation over the long run, like it has the past several hundred years.


Outcast, I guess I wasn't clear. The S&P stomped a "just keep up with inflation scenario" based on Adams Numbers. Way better than gold.

Still, BTC out performed both in the timeframe I started investing in it. This downturn was expected and welcome. The bottom was reached at 15K and since the start of the year has turned around, this too was expected. 2023, 2024, and 2025 will all be up years, based on the Halving coming in 2024. This is the fourth Halving and so far it is following the script. We will see.

Peace
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Re: Collapse of FTX crypto Bank....a Lehman Moment?

Unread postby theluckycountry » Tue 24 Jan 2023, 16:08:21

Gold is a hedge, one that belongs in any thinking persons portfolio. It rarely goes to the moon like bitcoin did, like many useless IT stocks did in 1999, but when the dust settles it's always still there, still ahead of inflation. Even during the 1930's after the gold hoarding act was passed and you were only allowed to own 8 ounces it held up. In fact it went up 50% while everything else collapsed in a deflation that lasted until after WWII.

Those 8 ounces btw were never policed. A smart investor, who kept their cash at home and not in an institution may have had 300 ounces and no one would know. I'm sure a lot of people survived the Great Depression quite well by selling a couple of those ounces periodically. Interestingly no one was ever charged under the Hoarding act. The government didn't care about a few rabbits that escaped the hutch because they had the vast majority. All the trusting souls that kept their gold in the system.

So the question one really needs to ask is this. "Is there possibly another massive collapse on the horizon?" Something similar to the Great Depression where all but one asset class tanked? If not then gold investment would be unnecessary.
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Re: Collapse of FTX crypto Bank....a Lehman Moment?

Unread postby AdamB » Tue 24 Jan 2023, 16:31:45

theluckycountry wrote:Gold is a hedge, one that belongs in any thinking persons portfolio. It rarely goes to the moon like bitcoin did, like many useless IT stocks did in 1999, but when the dust settles it's always still there, still ahead of inflation.


But not ahead of the market, as my personal experience and data previously provided from the early 80's versus now demonstrates. I recommend thinking more, and not just swallowing whatever PM propaganda herdthink that your Chinese masters brainwashed you with. if you can't be an American, then be bold, be brave, be smart, and at least try and act like one.
What does a science denier look like?

Armageddon » Thu 09 Feb 2006, 10:47:28
whales are a perfect example as to why evolution is wrong. Nothing can evolve into something that enormous. There is no explanation for it getting that big. end of discussion
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