Same here. I specifically requested to be paid in bitcoin. I had bitcoins on MtGox and I wanted the bitcoins back from the day they were stolen. They have been found and my claim is accepted. Now give them back.
579 karma · joined July 8, 2014
But I don't intend for this to become a political discussion. To me, this is just an effective example of how "doing what you feel like" can be very different from living in nature or in a natural state and being happy.
The closest you can currently get to "doing as you feel", involves moving to Europe and becoming dependent on the socialist state. You can live for free in a flat forever, never have to work, get free health care for every booboo, just hang out all day surrounded by people who do the same thing. I would say this is currently the state of the art in living an unnatural life. And as a result, you might end up being miserable.
But I do sort of understand what you mean; our brains were built for living in natural environments. These impose fairly random and complex constraints, with stress coming in big but short-lived peaks and real family being constantly around.
Living in a concrete jungle and having constant low level stress, doing and eating the exact same things every day, taking pills for every little ill is a recipe for alienation and early death.
Having proper income for daily life and budgeting for setbacks is a different discussion. That's an issue you must get in order prior to investing. It's a prerequisite.
Yes the stomach and patience are hard. Basically because you will never be sure.
Maybe the Burry list, in order:
1. The intelligent investor, Graham & Dodd
2. Common stocks and uncommon profits, Fisher
3. Why stocks go up and down, Pike
4. Buffettology, Buffett and Clark
but of course a lot of it is trends in accounting and legal issues. Which may be hard to learn on your own.
- by focusing on great value, the proverbial dollar for 50 cents. This is kind of hard work, you have to put in the time, which means you have to be genuinely interested in "business" or you won't keep it up.
- by not doing anything unless you find a dollar for 50 cents. Wall Street has to play all the time, you don't.
- by holding a sufficiently long time. Of course you can't wait indefinitely; sometimes just taking a loss e.g. if you find something else which is great value.
- by stomaching volatility
- by embracing volatility and, when you can, making sweet love to it
- by keeping it simple. Your only "hedge" can be just trying to pay 50 cents for a dollar. Having some crude heuristics for timing and taking profits.
- by assuming every management team and big shareholder is constantly trying to screw you over. Tolerating no bullshit. Trying to avoid being around morally handicapped people (this applies to any part of life imho).
- most relevant to the original article: by not tolerating anybody else's opinion (which implies investing your own money and only your own money, meaning you can. not. get. fired. Ever. And if you screw up, you'll learn.)
- by avoiding tip givers and tip takers. Group think is a killer. But of course, enjoying talking about general conditions. (My honest, very personal take on current group think: "you can't go wrong with low cost index investing". Which is not a bad idea in itself, until everyone starts doing it and they flood the market with indices and dubiously structured trackers.)
- once again, by not feeling you have to be part of everything which goes up.
- by having a lack of stress (you will doubt a lot, get screwed by management and big shareholders and have plenty of losers and lumpy payoffs)
- by doing this for a very long time (as in: the 80s were much easier than the 201xs, maybe just because fewer people were watching. And back then they were sometimes hiding profits instead of faking them. Today is the hardest time ever, if I find something superficially good, probably something is wrong with it. Personally I have very little self confidence today.)
- being small, which means you can look in places the big guys who have to move around billions can't look
- staying on the "easy side" of the basic math of loss vs profit. I personally would never short or sell optionality or stuff like that. Willing to take a gentle thrashing but never ruin.
And necessarily:
- by avoiding the show stoppers (start playing bridge, take a journey around the world, get divorced, disease, death)
Everything else is bullshit. Or at least part of more complex or shorter term or "trading" strategies with which amateurs can of course never do great. Volatility is not risk. Concentration is not necessarily risky.
Edit: poured out some random thoughts and tried to clean it up later. Sorry for the mess.
- Monetary inflation and price inflation are different things. Right now we have unprecedented monetary inflation in terms of base money, but almost no price inflation.
- Price inflation is always a very non-linear function of its drivers.
- Price inflation also doesn't have to be uniform. Some people would argue that the monetary measures taken after the financial crisis have already led to price inflation, namely price inflation of financial assets such as bonds and stocks. In this view, the money has been sloshing around the world as excess liquidity, being passed on like a hot potato that nobody wants to hold, propping up new bubbles but without leaving the financial system.
- A simple quantity theory of money may not apply because we live in a complex credit based system. Base money is just a liability of the central bank. We don't pay and save much in base money, we pay and save mostly using liabilities of private banks. As long as the increases in base money don't trigger increases in these broader forms of money and credit (this is what it means when they say "the transmission mechanism has broken down" or "the velocity of money is too low"), we shouldn't normally expect any direct impact of base money increases on price inflation.
About bitcoin: any healthy, advancing economy running mostly on actual bitcoins as a medium of exchange would probably see price deflation in terms of bitcoin. If we were to have technological progress like we had the last 50 years, the price deflation would probably be unprecedented. But if we could manage to piramid ever increasing amounts of credit on top of actual bitcoins and pay and save mostly in those credits, probably not so much :-)
EDIT: thx to everybody who replied! That being said, I would have really liked to discuss the actual technicality of blocking a cryptocurrency :-) E.g. what technical measures could a hostile government take against bitcoin and how would any circumvention techniques, if they exist, impact scalability and usage of bitcoin. A lot of answers here just give reasons why a govt would never do something like this; or that there are other ways of discouraging bitcoin users; or that it wouldn't affect users outside of that country (wouldn't it though?). I think the dependence of cryptocurrencies on IT infrastructure is an important issue, as it puts boundaries on the extent to which a cryptocurrency's can truly be considered decentralized. I think we should assume that, given enough time, any cryptocurrency that makes it to the big leagues of being used as transaction money will be put to this test. And if it fails this test, its use cases will be more limited than what some currently think.
The difference is that without e.g. interest rate manipulation, we'd probably have a lot of "rolling waves" of small recessions. These small recessions would be frequent but also limited in duration, scale and scope.
With suppression of interest rates, the malinvestment becomes bigger and broader. Meaning their unraveling is much more traumatic.
9 years into the latest boom, with ZIRP and NIRP and QE and mark to unicorn accounting and all the other oxycodon shots necessary to abort and forget the 2008 run on the system, we can only wonder what has been built up in terms of malinvestment and what the unraveling will be like. Not just in the world of finance and credit, but also in the real economy, where much of the recent competition and "disruption" is really based on venture capital backed companies not worrying about profitability for years on end.
Also, (imho) the problem is not some people making more money than others. The problem is that the grim reaper of capitalism is still hard at work for regular working people, but has been quite absent at crucial points in time when it comes to certain big capitalists.
Wrestling mom & pop into submission and taking over their land is less hard if you don't really have to worry about mundane things like being profitable, paying taxes, complex legislation, risk consciousness in investors, personal liability, mark to market accounting or making sure your constructions are capable of surviving some slight financial turbulence.
One group is subjected to ultra efficient capitalism.
Another group can benefit from a myriad of complex tax breaks, government deals, revolving door relationships between legislation and business, ZIRP, NIRP and when things get really dangerous for them: outright bailouts.
Not all mega-corps depend on all of these unfair perks. I actually have a rather positive view of SV and the tech sector. They derived huge benefits from ultra loose monetary policy over the last few years (Amazon included), but they also do some genuinely great stuff.
That's why I said it goes way beyond the tech bubble.
Meanwhile Wall Street has been bailed out 2 times in the last 15 years alone with monetary policy. How many people went to jail? (And they haven’t learned a thing, on the contrary and quite spectacularly so.)
If you want to know where the tech bubble comes from, don’t think about the talent pool in SV.
Think 2008 and central banks. It's not normal for investors to accept visionaries wasting endless billions for years on end. Except when the availability of capital appears infinite and risk appears almost non-existent.
In contrast, a big group of people stagnate and even get squeezed. Not rich enough to enjoy the high life of the zero/negative yield world. Or to overcome decades of inflation. Not poor enough to just give up and go on food stamps.
Ultimately, it’s not about a tech bubble. It’s about a credit cycle on steroids, held together with spit, rope and gum and massive moral hazard. Who gets access to the funny money first? And who will be left holding the bag?
Btw Taleb was a huge fan of Beard. Until a few days ago that is.
https://en.wikipedia.org/wiki/John_Meriwether
"A year after LTCM's collapse, in 1999, Meriwether founded JWM Partners LLC. (...) Meriwether opened his third hedge fund venture, named JM Advisors Management, also based in Greenwich, Connecticut, in 2010."
Meriwether blows up and is not a fraud. But then there's this guy:
https://www.wsj.com/articles/jon-corzine-considers-launching...
Though in all fairness I don't know whether he pulled that one off.
This is terrible. When will people learn to NOT use computers at all for some things. Use typewriters and spend a little bit more on administrative workers. You trade in processing efficiency for making these catastrophic breaches rarer.
https://en.wikipedia.org/wiki/Nixon_shock
to give just 1 example.
"Replace diesels with batteries on timeline x-y-z. Bam, just like that. Problem solved."
The platinum price has been dropping for many years, because Mr Market is thinking 5 steps ahead of where we actually stand with this. With above ground reserves likely dwindling, platinum has still managed to drop below gold again (and rhodium has dropped below platinum).
But batteries are not yet ready to take over everything. Diesels or at least combustion engines will keep improving for some time to come. In the meantime, plenty of room for alternatives like the discredited fuel cell, which can also use loads of platinum. (And on the supply side, you have the vulnerability that the country supplying 70% of the world's platinum is looking increasingly unstable.)
And for the record: I totally agree we should get rid of the combustion engine as soon as possible.