by Travis Johnson, Stock Gumshoe | March 1, 2024 4:03 pm
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The Stansberry pick is MKL. I am a subscriber.
Thanks for your take on Crypto. I think about the same as you do, however it is hard for me to discount the MKT Cap of Bitcoin being over a $$1,trillion. Since about 2010.
There is a a feature of Bitcoin that some folks have no information about and It is called “Halving”. (google bitcoin Halving) (google the past time periods for the 3 halving events that have already taken place). The first one offered up an 11,645% gain over 4 years. The 2nd one offered up a 7,382% over the next 4 years increase and the 3rd 1,991 % over the next 4 years. Halving events are going to take place well into the 2100’s I think I saw that on Blockchain.com.
The next Halving is going to take place in early to mid April 2024. I am risking $5000 (money I can affords to lose) that Bitcoin will see at least a 1000% gain in the next 4 years and will return me $55,000.
I do know that if I had stepped up in 2012 years ago and put up $10 and purchased 1 bitcoin ==== today it would be about $62,480.
Please do not take my word for it. I am not a Bitcoin guru or financial advisor.
P.S. Bitcoin was about $46K when the new spot bitcoin ETF’s were released. That had nothing to do with Halving! The upcoming Halving event will not skyrocket Bitcoin and the ride up to my guess of 1000% or more will be very rough to ride.
Talk about kicking yourself! I first heard of BTC back in late 2010. I allocated $400 to buy at .25 / per BTC, but it was so complicated at the time I gave up. Do the math.
Oof. I bought my first Bitcoin around $800, I think. I didn’t get involved until Coinbase made it easy. Sold too much around $2-3,000, as I recall, too annoying to go back and look at the actual price 🙂
I would like to know what would be the most secured way for a total novice to invest for the first time in Bitcoin and Ethereum just a small amount for diversification and education. I would appreciate any advice you can provide. Thank you.
PayPal offers several coins in an easy to trade platform. Coinbase is also relatively easy and popular.
Thank you very much. I appreciate your recommendation and will check them both out.
Thank you. I will give it a try with a minimum investment. Appreciate your advice.
Kraken is easy and been in business for along time
Tank you. I will check it out. Appreciate your recommendation. Crypto is so foreign to me but I would like to give it a very small shot.
On your portfolio a lot of the fields say loading. Could it be updated? What percentage of your portfolio is BSM?
Sorry about that, I’ll reload it when I can. BSM is just under 0.5%, starting small (as I usually do)
Completely agree that Warren Buffet’s letter is a lovely read as is your Friday file.
Crypto Article: Caught this article. LET BITCOIN COOK, at ZeroHedge today and am passing it on. When I was a kid back in the 50’s my Dad used to tell me, “son, when you hear a steak sizzling on a grill, go get some”. I’m not only hearing the sizzle but I’m smelling it too! Seems everyday there is a new story. https://www.zerohedge.com/markets/let-bitcoin-cook
I am starting to sell off my magnificent 7
It seems like few investers have beaten the s&p 500 or brk over the long term.
I am thinking on putting all of all my money into both and relax iti my retirement years.
What say you?
I don’t know what the future holds, but I’d rather commit
To the S&P 500 than to the “Mag 7” over the next decade. Settling for average is comforting and lets you spend your time on something you prefer… nothing wrong with that sentiment.
Hi Travis; I would be curious to know if Warren Buffett has ever expressed his opinion of crypto.
Not as vehemently as Charlie Munger, who called it “rat poison,” but he’s certainly not a fan. Mostly because of the speculative/gambling fervor with which it is sold, and an opinion that this has been immoral, but also because of the lack of ownership/financial fundamentals that makes it impossible to rationally assess the value.
Buffett generally thinks gold is dumb, too, though he did speculate on silver when it bottomed out ~20 years ago.
US Government has also accumulated a huge amount of Bitcoin – estimated to now be worth over $12 billion
In yet another ZeroHedge article: tells of a “Big Whale” who has accumulated in excess of 3 billion dollars in Bitcoin since Nov 2022.
https://www.zerohedge.com/markets/mystery-whale-has-quietly-accumulated-over-3-billion-bitcoin-15-months
Is QT really QT? This week I saw a report that said that the Fed’s QT has removed about $1-$1.2 Trillon from the balance sheet – hence tightening. The report also showed something I only heard this one time; therefore, cannot assert that it is true. The other thing was that the Fed’s had conducted over $2T in their repos program where they pay banks and other financial institutions $1 for bond/ treasuries/ etc. that are worth far less. The up shot was that the while the Fed had pulled $1T out of the market with their right they added $2T with the left hand hidden behind their back. Again, not sure about the validity of all this. But if true it does provide a plausible explanation how the economy and market can both continue to hum along presumably in tighter liquidity. It’s not as tight as it appears.
If someone has more clarity please help me and others verify or correct the above info. Thanks.
You have conflated and confused several different items into one; while related, they are not synonomous with each other…
* QT (Quantitative Tightening) removes liquidity from the market. The Fed achieves this via SOMA. More info (updated weekly) here < https://www.newyorkfed.org/markets/soma-holdings >
* RRPs (Reverse Repurchase Purchases) is an alternative short-term (as in, mostly overnight) funding mechanism that the Fed also diminishes. The last time the Fed slackened the availability of RRPs (2018/2019) created a mini-crisis. fyi: Money market funds surged into RRPs over the past year. RRPs lessened availability and the liquidity crunch the Fed pursues could ‘break’ something yet again.
* BTFP (Bank Term Funding Program) was announced 1 year ago < https://www.federalreserve.gov/newsevents/pressreleases/monetary20230312a.htm > during the twin crises (liquidity AND solvency last March) – but solvent banks quickly gamed the program to their selfish benefit. The Fed is in the process now of shuttering BTFP.
You are correct though with your big-picture analysis, that the Fed speaks with a forked tongue. 🙂 Its policy re interest rates gets all the media attention but often is at odds with the programs that gain little notice.
Somewhere in this reply will be an image file of the SOMA balance vis a vis the S&P. Its message is clear.
Hi dmgordon; So it seems as though you feel that the SOMA balance is a leading indicator and is telling us that the market is heading lower
Hmm, “leading indicator” – I like that!
You could argue that SOMA has a causative relationship with equity trends (the market thrives on easy money, struggles when the punchbowl has been taken away) — but predictive? You need only look at the far right side of that SOMA chart above to see its crystal ball powers are rather… turbid. That said and acknowledged, however lengthy the latency, less money in the system historically gives equities conniption fits.
One more item re QT, an article from today’s edition of the Financial Times…
Thanks for the update, Travis.
Are there any coin wallets you would recommend for cryptocurrencies, or even an intro “how to” article for those that want to get started on crypto but don’t know where to start?
I use Coinbase and Coinbase Wallet, partly because I like that there’s a US-based company behind it and partly because I’m lazy and it’s what I started with and am accustomed to and I understand their tax reporting, so it’s easy to stay with it. They have pretty decent support materials here to tell you how to get started: https://help.coinbase.com/en
I’m told that it’s safer to buy a physical cold wallet for self-custody of your keys, though then, of course, you also have to be careful not to lose the wallet or password(s).
Gotcha. Thanks!
Travis, the last time Bitcoin hit $60K, around November 2021, your lock box stock BRPHF hit an all time high around $32. This time with bitcoin over $66K today, the stock has come off its lows but its high is around $11. Do you have any thoughts why? Does Galaxy Digital still have plans to list on NASDAQ?
They’ve had all kinds of challenges in the interim, when I last checked (last Fall) they had made no real progress.
Bitcoin Tops $68K, Nearing Silver’s $1.38T Market Cap. (CoinDesk)
Regarding the Novice question – there are a lot of people suddenly interested in Bitcoin and cryptocurrency. If you ask people like Travis or myself, we either got in early and sold before the
big gains, only to breathe a sigh of relief when BTC tanked – only to kick ourselves again for selling
in the first place! I was turned on to BTC and ETH by chance, while having breakfast at a resort in
Canada – located on the lake in Kelowna, British Columbia. A man next to us was quite loud and was
discussing an investment he had made. After he completed his call, we were bold enough to ask:
“What kind of investment were you talking about?” The man said with a loud voice: “Bitcoin and
Cryptocurrency!” This was in 2012, a lifetime ago for investors in any of the crypto products!
I feel the same way as Travis – “Should have bought a large position and held on!”
So what should a Novice investor do in this dynamic part of the investment world?
First, prepare for volatility. The moves lately have been fueled by demand, the creation of several
funds by mainstream financial institutions (Blackrock, Fidelity and soon to be some of the banks, etc).
What does this mean? The products are going to be available to more private investors, and the entry
is as simple as knowing the ETF symbol and placing your order. No need to have a wallet or remember
a password (other than the one to your trading account).
For the Novice, there are three mainstream ETFs that you can consider for ease of entry (there are many more, but they may not have the volume of transactions that these three offer):
In order of Assets under management: IBIT from Blackrock (the largest of the three – and this is a relatively new fund). Also relatively new is GBTC from Fidelity, which is offered to customers who are used to buying both Mutual Funds and ETFs): Finally, there is the RockStar of volatility and Ups and Downs and Up again: Cathie Wood and ARKC, which has gone from a low of $25.72 on 1/1/24 to a high of $42.38 today, 3/4/24. Some of these funds are offering low fee incentives for the first several months.
Otherwise, you could open an account with Coinbase or InterActive Brokers or any number of financial entities who would love to charge you fees as you do “on the job training” in Bitcoin or any number of cryptocurrency products. I have opted for the Fidelity Fund, simply because I have an account with them and I believe the clients they have are generally not traders or speculators.
One more thing: look at the charts. If you want to start buying, start small. Hundred Dollars vs Thousands of Dollars. This is not a race – it certainly is not a sprint, but rather a long distance Marathon. There is so much speculation right now about the “Halving” and additional investments that we must all be prepared for corrections over the next weeks, months and years.
D0n”t put any money into this investment that you may need to pay the bills or future purchases.
Above all, have some fun with this. I would finally suggest: If you think you will need to sell at a loss some day because these funds start losing money: “Don’t use an IRA or a RothIRA, etc. There is no way you can write off you losses with such an account. But if your crystal ball says Bitcoin is going to the moon and beyond -Sooner than Later! – Then a tax deferred account might be just the ticket. This is where your timing expertise will make you more money that the rest of us. Travis and I know: Crypto is not for the faint of heart! Be careful out there!
Wise words!
During the COVID-19 period until now, my investment strategy has undergone significant changes, with a strong focus on cryptocurrencies and related assets. Taking advantage of the availability of BTC and ETH ETFs in Canada, I’ve consistently invested in them through tax-efficient accounts (RRSP, TFSA), employing a dollar-cost averaging approach. Additionally, I hold positions in mining companies like CLSK, BITF, and MSTR, which has been a top performer this year.
To optimize my portfolio, I’ve shifted away from ETH ETFs and concentrated on altcoins, particularly Solana, which I’ve been accumulating since its price was $10. While this strategy has yielded positive results, I’m mindful of the need to strategically exit my altcoin positions as the bull run progresses.
In a bold move, I liquidated all my gold and silver bullion holdings in favor of Bitcoin. However, I’m considering gradually re-entering the gold bullion market. This dynamic investment approach demands resilience and thorough risk management.
I value your insights, Travis, which have guided me since 2013. This journey is not for the faint-hearted, but with calculated bet, it’s been working out thus far.
Thanks for the update… good luck to you! The altcoins mostly just scare me, I have a hard time investing in anything that I can make a financial argument about, since it means I don’t have anything to hold on to on days when they’re going down… but they have certainly boomed many times.