Warren Buffett and Bitcoin

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  #1  
Old 05-01-2022, 01:33 PM
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tophcfa tophcfa is offline
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Default Warren Buffett and Bitcoin

Warren Buffett, indisputably one of the most respected investors ever, stated he wouldn’t buy all the Bitcoin in the world for $25. Buffett believes assets have to have value, deliver something to somebody. He said he would gladly write a check for $25 billion for either 1% of all the farmland our apartment buildings in the country, those assets produce food and rent, but Bitcoin produces nothing. He further stated that the only thing one can do with Bitcoin is hope someone will be willing to buy it back and that it undermines the Federal Reserve system. In his strongest statement, Buffett said that Bitcoin is “probably rat poison squared”.
  #2  
Old 05-01-2022, 03:07 PM
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Originally Posted by tophcfa View Post
Warren Buffett, indisputably one of the most respected investors ever, stated he wouldn’t buy all the Bitcoin in the world for $25. Buffett believes assets have to have value, deliver something to somebody. He said he would gladly write a check for $25 billion for either 1% of all the farmland our apartment buildings in the country, those assets produce food and rent, but Bitcoin produces nothing. He further stated that the only thing one can do with Bitcoin is hope someone will be willing to buy it back and that it undermines the Federal Reserve system. In his strongest statement, Buffett said that Bitcoin is “probably rat poison squared”.
People use the term Buffet like. I find that whole thought amusing. Buffet says I lost 44 million on that stock. I am Buffet like, except for reality. If, I lost 44 million dollars there would be a lot of people wondering how they were so dumb to LEND me that much money.

Bitcoin reminds me of tulip bulb trading like 600 years ago. There were wild swings.
Even the church was involved. Some people made a lot of money. When, it finally burned out the last holder discovered they held a pile of bulbs they paid way too much for.

Bitcoin. If you read about it, all these people buying and selling, "tulip bulbs." The dollar is based on the full faith and credit of the United States. It is no longer redeemable in gold or silver. That backing may be of depreciating value and respect. However, Bitcoin is backed by NOTHING. The creator does not actually exist. There is only rumor and suspicions. Imagine buying anything with Bitcoin. It's,"value," is compared to the dollar. The dollar itself fluctuates. OOPS you wanted to pay some number of bitcoins for xxxx it just dropped 5%.

Talk about HUH. People are buying real-estate cars, boats in the imaginary world called the metaverse. I understand you can choose your neighbors when you buy your non-existent lot.

It is or was a way to launder money.

Amusing to watch. Far as Tulips, far as I know the Villages is too hot for growing Tulips.
  #3  
Old 05-01-2022, 04:37 PM
MartinSE MartinSE is offline
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I am not smart enough to have any thoughts on Bitcoins themselves. BUT. From what I understand the value in Bitcoins is two things. One they are 100% untraceable. And two, they disempower banks. A lot of people see banking as "evil". I am not taking a side, just repeating what I have read. It will be interesting to see how it goes. My biggest problem with Bitcoins is that the farms use hellish amounts of energy, most of which is in China and produce using coal. Not good.

Bitcoin mining consumes around 91 terawatt-hours of electricity annually. The Digiconomist's Bitcoin Energy Consumption Index estimated that one Bitcoin transaction takes 1,544 kWh to complete, or the equivalent of approximately 53 days of power for the average US household.

To put that into money terms, the average cost per kWh in the US is 13 cents. That means one Bitcoin transaction would generate more than $200 in energy bills.
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  #4  
Old 05-01-2022, 04:42 PM
Stu from NYC Stu from NYC is offline
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Agree with Mr Buffett.
  #5  
Old 05-01-2022, 05:02 PM
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I usually don’t agree with tax cheats, but in this case I do.
  #6  
Old 05-02-2022, 05:06 AM
Boomer Boomer is offline
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Quote:
Originally Posted by tophcfa View Post
Warren Buffett, indisputably one of the most respected investors ever, stated he wouldn’t buy all the Bitcoin in the world for $25. Buffett believes assets have to have value, deliver something to somebody. He said he would gladly write a check for $25 billion for either 1% of all the farmland our apartment buildings in the country, those assets produce food and rent, but Bitcoin produces nothing. He further stated that the only thing one can do with Bitcoin is hope someone will be willing to buy it back and that it undermines the Federal Reserve system. In his strongest statement, Buffett said that Bitcoin is “probably rat poison squared”.

Thanks, tophcfa,

I knew my instincts were right this time. I would not touch Bitcoin either.

They say experience is the best teacher — next to Warren Buffett, of course.

I got caught in the dot-com bubble of the 1990s. When that bubble popped, I clearly remember thinking. . .well, this must be exactly what the term ‘sucker punch’ means.

I also clearly remember my thinking that led up to getting caught in that big pop………

I thought I was seeing the future…….

I would come home from work, check my funds, and revel in my brilliance……..

There was a brief and shining moment when I had a fund doing more than 100% — rocket fast.

My thinking was so arrogant, so nauseatingly arrogant.

At least, I had not bet the farm, only the butter and egg money. But, even so, that experience reined me in and I have been boring ever since.

Boomer

Last edited by Boomer; 05-02-2022 at 05:31 AM.
  #7  
Old 05-02-2022, 06:56 AM
dewilson58 dewilson58 is offline
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I've been playing with Bitcoin as part of my speculation dollars.

I've gotten my original investment back five times over.
I've taken three of the fives times off the table.
I have no basis in my bitcoin pot now.

Sometimes it's bad to pass up opportunities...........sometimes.

  #8  
Old 05-02-2022, 08:28 AM
Malsua Malsua is offline
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Originally Posted by MartinSE View Post
One they are 100% untraceable. And two, they disempower banks. A lot of people see banking as "evil". I am not taking a side, just repeating what I have read. It will be interesting to see how it goes. My biggest problem with Bitcoins is that the farms use hellish amounts of energy, most of which is in China and produce using coal. Not good.
There are a couple things you've got wrong here.

1. Bitcoin transactions are 100% TRACEABLE. All the way back to the first coin. This is what is called an open ledger. If I know your wallet addresses, I can find every movement of every coin, into and out of your wallet for all time. You cannot hide it. It's very easy to see as well as there are large, free websites that will give you all that information.

Transactions can be obfuscated with tools, but what those tools do take large quantities of coins and dump them into a blender, mix them with other stuff and push out small amount. Again, if I know your wallet address, I can watch it all happen, pretty much in real time.

As far as energy usage goes, if it cost $100 to use a bitcoin, the fees would prohibit usage. There are around 500 "transactions" i.e. You bought a cup of coffee, in a block confirmation. Each block may cost around $100 so your cup of coffee cost a 20 cent fee.

There are other crypto currencies that confirm blocks for much less than bitcoin. On the Solana chain for example, block confirmations are in the hundredths of a penny.

Finally, how much do you think traditional finance costs? When you do the actual comparision, bitcoin transactions are a bargain. How much energy does every bank use? It dwarfs bitcoin, around 800 to 1. No building to run, no lights, no AC, no heat, no people driving to it, on and on and on.

If you don't want to use bitcoin or any cryptocurrency, don't.

The Federal Reserve in the process of building their own Fedcoin. I don't know what it will be called, but it's a CBDC(Central Bank Digital currency). Children born today will not understand why you ever had to go to a building somewhere in town to get money. It will all be some form of a Blockchain(which is what Fedcoin will be) and it will all bear some resemblance to bitcoin(in function essentially) except that Fedcoin will be centralized instead of distributed.
  #9  
Old 05-02-2022, 08:33 AM
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tophcfa tophcfa is offline
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Originally Posted by dewilson58 View Post
I've been playing with Bitcoin as part of my speculation dollars.

I've gotten my original investment back five times over.
I've taken three of the fives times off the table.
I have no basis in my bitcoin pot now.

Sometimes it's bad to pass up opportunities...........sometimes.

It’s a game of musical chairs. If you get in early while the music is still playing it’s all fun, but it’s wise to stop playing early. When the music stops there very well might not be a single chair around.
  #10  
Old 05-02-2022, 08:33 AM
charlieo1126@gmail.com charlieo1126@gmail.com is offline
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Quote:
Originally Posted by MartinSE View Post
I am not smart enough to have any thoughts on Bitcoins themselves. BUT. From what I understand the value in Bitcoins is two things. One they are 100% untraceable. And two, they disempower banks. A lot of people see banking as "evil". I am not taking a side, just repeating what I have read. It will be interesting to see how it goes. My biggest problem with Bitcoins is that the farms use hellish amounts of energy, most of which is in China and produce using coal. Not good.

Bitcoin mining consumes around 91 terawatt-hours of electricity annually. The Digiconomist's Bitcoin Energy Consumption Index estimated that one Bitcoin transaction takes 1,544 kWh to complete, or the equivalent of approximately 53 days of power for the average US household.

To put that into money terms, the average cost per kWh in the US is 13 cents. That means one Bitcoin transaction would generate more than $200 in energy bills.
china has now banned crypto and the USA has quietly slipped into the number 1 mining spot
  #11  
Old 05-02-2022, 09:30 AM
dewilson58 dewilson58 is offline
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It’s a game of musical chairs. If you get in early while the music is still playing it’s all fun, but it’s wise to stop playing early. When the music stops there very well might not be a single chair around.
Absolutely.
I told my kids they were idiots to invest.
(of course I have not told them my story)
  #12  
Old 05-02-2022, 09:43 AM
Stu from NYC Stu from NYC is offline
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Originally Posted by Topspinmo View Post
I usually don’t agree with tax cheats, but in this case I do.
Why would you think he is a tax cheat?
  #13  
Old 05-02-2022, 11:57 AM
tvbound tvbound is offline
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Quote:
Originally Posted by tophcfa View Post
It’s a game of musical chairs. If you get in early while the music is still playing it’s all fun, but it’s wise to stop playing early. When the music stops there very well might not be a single chair around.
I totally agree. While there will always be those who anonymously tout (falsely brag?) about how much they've made on crypto and were able to get out already with huge returns, IMHO the market is being driven by those who are ruled by FOMO (fear of missing out). As we've seen time and time again (the Tulip fiasco is a good example) by the time that fomo feeling takes over, it's usually too late. And those few who actually made amazing returns by actually getting out, will most likely try again for that adrenaline rush and good luck to them looking for a seat - when it crashes. I'll continue to look to the Oracle of Omaha and his tried and true formula for building wealth - as it's worked pretty well so far.
  #14  
Old 05-02-2022, 02:06 PM
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I usually don’t agree with tax cheats, but in this case I do.
Tax cheats? The reality is no one wants to pay taxes. Everyone wants stuff, services.
A tax deduction? It is fair if I get it. If, someone else gets a deduction that is cheating.

Reality, there is a line on the tax form where you can pay more tax, if you choose to.

It is interesting. Our constitution is four pages. Our tax code is one hundred and eighty THOUSAND pages.

We know if you tax something you will have less of it. If, you subsidize something you will have more of it. We tax WORK. We tax SAVING. We subsidize POVERTY. We subsidize DEBT.
  #15  
Old 05-02-2022, 02:15 PM
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Originally Posted by Boomer View Post
Thanks, tophcfa,

I knew my instincts were right this time. I would not touch Bitcoin either.

They say experience is the best teacher — next to Warren Buffett, of course.

I got caught in the dot-com bubble of the 1990s. When that bubble popped, I clearly remember thinking. . .well, this must be exactly what the term ‘sucker punch’ means.

I also clearly remember my thinking that led up to getting caught in that big pop………

I thought I was seeing the future…….

I would come home from work, check my funds, and revel in my brilliance……..

There was a brief and shining moment when I had a fund doing more than 100% — rocket fast.

My thinking was so arrogant, so nauseatingly arrogant.

At least, I had not bet the farm, only the butter and egg money. But, even so, that experience reined me in and I have been boring ever since.

Boomer
Wisdom from BAZOOKA bubble gum comic. The big roll. The one that cost a nickel. The one that gave you six lumps for the price of five of the penny size.
Buy low and sell high.

Buffet, listed as THE GREAT stock picker. Buffet does not make money on every trade.

Life? Part of living is making mistakes.
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