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”.

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.

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.

Agree with Mr Buffett.

I usually don’t agree with tax cheats, but in this case I do.:duck:

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

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.

:MOJE_whot:

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.

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.

china has now banned crypto and the USA has quietly slipped into the number 1 mining spot

Absolutely.
I told my kids they were idiots to invest.
(of course I have not told them my story)
:)

Why would you think he is a tax cheat?

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.

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.

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.

But if you look at his body of work he has done an awesome job making money for his investors

O please everyone heard his infamous statement. Why do you think he has army tax code lawyers, why do think lobbyist lobby career ————-. (Not allowed to say that word).

Depends on what period of time you look at.

Last five years: Berkshire 13.3%, S&P 14.9%

Last ten years: Berkshire 15.4%, S&P 14.5%

(Barron's March 4, 2022)

What a great thread.

Lots of people who don't understand Bitcoin whining about those of us who do and who've made tons of money.

If\when I buy my Villages house it will be 100% with bitcoin profits.

Great Buffet reference tho. I didn't know he was still alive.

Fidelity is kind of knowledgeable about investments and they seem to think Bitcoin is OK:

Fidelity will soon offer bitcoin as an option in 401(k)s - CNN

Hey,

Nobody is whining.

No need to be condescending. (Do I see a little ageism between the lines? Well, not exactly between the lines, is it?)

No need to be so upset because some people don’t care about Bitcoin and/or those people are not saying things you want to hear. Can’t find your trophy here?

Btw, even though I am oh so decrepit, I already knew about Fidelity playing to the Bitcoin crowd. That’s called marketing. Fidelity knows some people want to buy Bitcoin, so Fidelity is providing the tools for Bitcoin buyers to use — through Fidelity. That’s all. Fidelity does not actually know whether Bitcoin is going to be “OK” or not. (said Boomer, explaining patiently)

And, just for the record, guess what…….

Ya know that post I wrote earlier in this thread — about my dot-com bubble dancing days. Well, my dot-com funds were all Fidelity funds. But, at least I knew that Fidelity was not telling me dot-com was “OK.” Fidelity was just marketing to the times.

About your future TV house built of Bitcoin? Maybe so. Who knows? But I would lay some real money down on a bet that there are a whole lot of houses in TV built out of dividends, years and years and years of dividends.

Having fun at the Bitcoin Casino is fine, but maybe branch out a little. I was sure glad I had backup when I was putting my 403(b) in dot-com, and oh my, my, at the time, I thought I knew so much, so very much……….

Boomer (Advice 5 Cents)

To the OP, what was your motivation in creating this thread? I sense you are frustrated and are lashing out at crypto currency. I can sympathize, your hard earned dollars are diminishing at an advertised rate of 8 to 10% and the true purchasing power lost is likely much higher.

Sounds like you would benefit from coming to a Villages crypto currency club meeting. We actually have one tomorrow morning at the Water Lily rec center from 9am to 11am in person and we also have weekly virtual meetings Saturday mornings. Members of the crypto club can help teach you how to gain that to 8 to 10% back in interest bearing defi accounts.

If anyone in this thread would like more information and would like to have a constructive conversation about bitcoin and other crypto currencies reach out to me at dylanwaynetodd@gmail.com

Cheers,

Dylan

I am loving this thread.

But I gotta stop doing improv and go watch Ozark now.

Seeya,
Boomer

How many of us would not be thrilled with that kind of ROI over past 15 years

You realize that I didn't start this thread, right?

You Luddites are the ones beating your chests about how bad Bitcoin is. I'm just watching the show.

Wall st. is all in on Bitcoin. You can retire the Tulip references.

Pro Tip: Don't buy it if you don't like it. Bonus Tip: Don't get butthurt watching other people make money.

That dotcom story was great though. Up 100%???? Wow. That's less than my energy fund the last 2 years.

He has not been indicted for tax fraud has he? Whose fault is it that congress can be bought to enable people to pay less taxes. Us foolish voters keep returning the same congressman to office

I'm talking 5 and 10, I will have to sniff out 15.

Darn it, kid. You made me log back on.

That 100%-plus was fast, real fast. I was so happy with my new-found talent. I bragged — but only to Mr. Boomer. There is an old saying about people who go around bragging about money or whatever else — something about the ratio of hat to cattle.

Congrats on the energy thing though. I like energy. (And so did some big deal guy on WealthTrack last week.) I just don’t have any interest in Bitcoin. Why take that so personally and start name-calling?

“Just watching the show,” you say. We are the show. I have let this turn into some kind of generation v. generation thing. It needs to stop. I’m the grownup, so I’ll stop it.

And scene.

Boomer

PS: For anybody watching Ozark: I am on the second new episode. I am betting Ruth kills Wendy at the end of the season. (This is the last season.) But that bet might be like my dot-com bet. We’ll see.

Bitcoin does provide certain value as far as it being a private currency and it has an ability be used on the internet for micro transactions. This is something Warren Buffett doesn't understand. Also everything can we use for money if other people decide as value. Silver Pieces Of Eight which themselves can only be melted down for jewelry used to be used as well as large Stones cut into Wheels. We also use little pieces of plastic all credit cards which themselves are backed by little green pieces of paper are you put in your bank or by so cold faith of credit at your bank decides you are worth so in reality it is all game of faith

M g m was up 300% after the nosedive last year as well as many stocks

I had a 'friend' who invested a lot of my money in dot-com in the 90s and I too lost a lot of "butter and egg" money. Since then I educated myself about investing and I've chosen "boring" long term dividend yielding stocks that I believe in. NO BITCOINS. Boring is so much better!

Bitcoin has created fortunes for many. Like all pyramid schemes those who know how to trade it or get in early often make a profit. But there have been many losers as well but their stories are rarely told.

Keep in mind that even though it has some practical applications, it was created out of thin air so there is nothing exclusive to Bitcoin as it can be replicated many times over as it has been. Bitcoin is now only about 50% of the total crypto market cap when at one time it was 99%. Yes it was the first mover and widely adopted but that is no guarantee that it will not be replaced by a better engineered crypto coin in the future. Also the use of so called "stable coins" in trading such as tether which have extremely low audit standards makes it even more suspect.

I do not think the government should attempt to regulate private sector economic activity but the the insane decision to infect the futures and derivative markets with this illusionary industry that has no physical value increases the likelihood of making its collapse to be a systemic risk to our economy.

I loved Buffett’s simple, clear cut answers to questions which others make more complicated. Charlie Munger was typically even more direct. I agree with both—but I’ve never visited Las Vegas to gamble, which may explain my opinion.

Black thursday
 

doesn't smell like teen spirit
more like ponzi

Bitcoins are worth what investors think they are worth. Some people made money, some people lost their shirts, Bonafide, GAW. Invest if you can tolerate losing it all. Not my cup of tea. There are always people who tell you how rich they have become being rentals property owners, selling real estate themselves, selling their house in two hours, etc. Sometimes true, lots of BS. You only see the worm in the apple when you get up close.

For some reason most people will only tell you about their winners never the losers

I’d rather buy something I can put in my driveway or garage…..

You are very knowledgeable and have a great understanding of the Value of cryptocurrency.
We have a TERRIFIC crypto club here in The Villages.
We meet in person the first Wed.of each month 9 am at Water Lily. You are welcome.
We also do smaller group meetings throughout the week.

Ever know or talk to a gambler? They can lavish you with details of their big winnings last weekend, but rarely talk about the losing forays. Sure...there are pros who consistently win, but they are very few and very far between. There is a reason the house always wins.

^This. Concur 100%

Bitcoin can be good except if you're the last one holding it. I believe that it's a pyramid scheme that works well for those in the beginning and in the middle....... but not so good for those in the end. And if Bitcoin is so wonderful, how come they take dollars in trade? Because in the end, they'll have the dollars and you'll have nada.