Angry ‘hodlers’

Yesterday's comment on bitcoin struck a nerve with two 'financial advisers'. Both made a strong demand that I 'stick with watches, or else', with one specifically requesting that I disclose my own investment portfolio, here, publicly. Sore losers: hit unsubscribe and make my day! However I am more than happy to oblige: here is the performance data of our Rolex restoration video, on YouTube. In 210 days this video was watched 3,140,888 times, generating passive income of $12,051 dollars. Total viewing time: close to half million hours! Actually, this video is so popular that it shows no sign of slowing down. Meaning it will continue to make us $1,700 per month for years to come. So much for your ‘stick to watchmaking’ advice. Yet this performance is hardly an exception: there are millions of hard working people out there who are not interested in get rich quick schemes; who understand that hard work invested in slow but steady growth will outperform the bitcoin hype. People with common sense, who use their brains, who are not side-tracked with fake news. People who enormously appreciate me, sticking it to you, disillusioned hodlers. Cheers.

Bitcoin is store of value?

You pull over at a petrol station, fill your sixty litre tank with unleaded, and drive home. The next day, the needle shows that you only have thirty litres left in the tank. You suspect a leakage. However, after examining the car, the mechanic concludes that there is nothing wrong with the tank. "It simply fluctuated in volume overnight, as they tend to do". But you know that the petrol tank does not and cannot fluctuate; by the very definition of being sixty litres in volume, it will hold sixty litres of petrol. Because that is what store of value means: being of a certain size, capable of holding and storing a certain volume of liquid. It is simply common sense. In the past year, Bitcoin exploded in volume by six hundred percent, then all of a sudden, in the past six weeks, almost halved in value. A few weeks ago, one Bitcoin was worth more than one kilogram of gold. Today, it is worth five hundred grams. Where did your gold disappear to? Well, if you ask your financial adviser, who got you into Bitcoin in the first place, he would tell you the same bullshit that idiot car mechanic told you: "things fluctuate over time, hang in there, it will bounce". Which could be true, no one knows what the future brings. But we do know that STORE OF VALUE - whether that is a sixty litre petrol tank, a meter stick containing one thousand millimetres, a kilo of gold, or your 4 bedroom house - remain very constant over time. Houses don't grow in size. Land does not shrink or fluctuate. Clock dials will always show sixty seconds per minute. For that reason, we call them 'store of value'. Bitcoin is not a store of any value whatsoever. It is a speculative 'asset'. A pyramid scheme designed to suck you in. Surely, some gamblers will get rich in the process, but that is not because Bitcoin is store of value. Of course, every real asset from gold, land, houses to petrol, could also be manipulated and hyped. Here is what happened on the weekend: some lunatic just bought a fibro house in St Marys (suburb of Sydney near Penrith) for $1.81 million dollars!

Cheers.

BITCOIN? LOL

 

We are on the brink of a historical event. In a few days - or even a few hours - one bitcoin will be worth more than 1kg of gold. Ironically the rise won't stop there - the 'value' of worthless crypto currency with no store value will continue to go through the roof! Until, like all bubbles in the history of humankind, it bursts into nothingness. The same nothingness it is made from.

For those of you wondering ''Am I too late to the party?'' my answer is simple: no, you are not. For the same reason a decent an honest man is never too late to a drug party organised by a gang lord. The fact that Bitcoin is fake gold is obvious to any reasonable person. It is not a currency, not an asset, not a unit of account and it doesn’t provide a scalable means of payment. No income, no use, no utility. At it's core, it is a self serving speculative system used by criminals, terrorists, human traffickers and tax evaders, sheltering their wealth and moving money across international borders. As a system outside government control, sooner or later, bitcoin will be crushed by governments world-wide because no government is going to allow untraceable tax-free transactions for too long. When that happens the bubble will burst and in that moment there will be no winners. Bitcoin will revert its intrinsic value – which is zero. Or more precisely below zero because maintaining the chain ledger will cost billions of dollars in electricity consumption alone. I am not a financial adviser of any kind, but when we have a spare dollar or two, we invest in education, workshop machinery and watches. Real assets that will take our earning capacity to next level. The best investment for a carpenter is in timber, for shoemaker in leather and jeweller in gold. Planting a few native shrubs in your backyard and painting a house with a fresh coat of paint is simply a smart investment. Investing in a new pair of walking shoes and a dog is the ultimate investment. Obviously, the future of money is in some form of digital exchange, and sooner or later we will go ‘crypto’. But that coin won’t be a Bitcoin. In 20 years from now you will remember this moment in time with chuckle, while checking the time on your NH Mark 1, Seiko or Omega thinking – well THAT watch was a great investment.