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Vanguard Founder Jack Bogle Says ‘Avoid Bitcoin Like the Plague’

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Re: Vanguard Founder Jack Bogle Says ‘Avoid Bitcoin Like the Plague’

#91

Post by rebuilder »

bpicolo wrote: post #65
desireco42 wrote: post #24

Another day, another alarmist article. Nothing Jack Bogle says is not true. Yet, he is 88yr old guy, with all due respect, he has no idea what Bitcoin is. I have yet to hear something from Wall Street that is novel and relevant to Bitcoin. It is a new thing they are afraid of, often not understanding it fully. When I say Bitcoin, I mean all crypto-currencies. If you don't know what you are getting into, I would advis…

> he has no idea what Bitcoin is Are you insane? He built Vanguard, the most successful investment product in history. They have 3 trillion dollars of assets managed and literally invented the retail index fund. You think he doesn't follow every aspect of the financial markets?

The Bitcoin bet is that traditional financial markets have it wrong, or don't serve the market Bitcoin serves. You judge how likely that is to be true.

Re: Vanguard Founder Jack Bogle Says ‘Avoid Bitcoin Like the Plague’

#92

Post by HarryHirsch »

rebuilder wrote: post #63
HarryHirsch wrote: post #15

Earlier quoted context omitted.

At least gold is used in jewellery and electronics. What is bitcoin used for, except ransomware?

Money laundering. Illicit transactions. Any number of things government money stored in banks is not much good for. How big a market is that? I'm guessing much, much bigger than most people think.

You do ask how people ran their drug-and-weapons enterprises before bitcoin. You'd guess it was through shady lawyers, corrupt banks, tax oases and webs of mailbox holding companies all the way down. That's proven working. But with bitcoin you are stuck with the dozen shady exchanges. Any normal criminal would think it's too risky.

Re: Vanguard Founder Jack Bogle Says ‘Avoid Bitcoin Like the Plague’

#93

Post by rifung »

non_sequitur wrote: post #11

“Bitcoin has no underlying rate of return,” said Bogle, 88, who started the first index fund in 1976. “You know bonds have an interest coupon, stocks have earnings and dividends, gold has nothing. There is nothing to support bitcoin except the hope that you will sell it to someone for more than you paid for it.” Didnt quite understand this quote - is he down on gold too?

Yes because he believes you should invest in things which inherently generate value.

Note that gold has inherent value in its use for conductivity or jewelry, but it doesn't create any more, which is the same at bitcoin.

In other words, I think he would argue that there's nothing "wrong" with buying gold, but you buy gold as speculation and not as an investment.

Re: Vanguard Founder Jack Bogle Says ‘Avoid Bitcoin Like the Plague’

#94

Post by cs702 »

> There is nothing to support bitcoin except the hope that you will sell it to someone for more than you paid for it.

Not everyone agrees with that statement. For example, see:

https://news.ycombinator.com/item?id=15797380

https://news.ycombinator.com/item?id=15796880

Re: Vanguard Founder Jack Bogle Says ‘Avoid Bitcoin Like the Plague’

#95

Post by dsacco »

slg wrote: post #30
non_sequitur wrote: post #11

“Bitcoin has no underlying rate of return,” said Bogle, 88, who started the first index fund in 1976. “You know bonds have an interest coupon, stocks have earnings and dividends, gold has nothing. There is nothing to support bitcoin except the hope that you will sell it to someone for more than you paid for it.” Didnt quite understand this quote - is he down on gold too?

Gold is certainly the ideal model for something like Bitcoin but in terms of projectable value gold has time on its side. I will happily invest in Bitcoin when its history as a store of value and a medium of exchange is measured in millennia.

> I will happily invest in Bitcoin when its history as a store of value and a medium of exchange is measured in millennia.

So is USD out for you too, then? It's not even 300 years old yet. If you mean fiat currency in general, that's also out, as we haven't had that for multiple millennia yet either.

Re: Vanguard Founder Jack Bogle Says ‘Avoid Bitcoin Like the Plague’

#96

Post by ftlio »

jozzas wrote: post #29

Bitcoin is becoming a value store. With slow transaction confirmation and high fees, what are the real-world applications for Bitcoin supposed to be now? And for those applications, are there not other cryptocurrencies more specifically targeted at being better at that application?

Bitcoin has the best security model. In 10 years does a single massive ledger make more sense than transactions at the edges? The value proposition of Bitcoin has always been transaction scalability by elimination of charge backs. With a fundamentally irreversible ledger as a base layer, networks and services will develop around it that provide whatever combination of speed, fees, and liquidity you're looking for.

Re: Vanguard Founder Jack Bogle Says ‘Avoid Bitcoin Like the Plague’

#97

Post by desireco42 »

jpk wrote: post #72
desireco42 wrote: post #24

Another day, another alarmist article. Nothing Jack Bogle says is not true. Yet, he is 88yr old guy, with all due respect, he has no idea what Bitcoin is. I have yet to hear something from Wall Street that is novel and relevant to Bitcoin. It is a new thing they are afraid of, often not understanding it fully. When I say Bitcoin, I mean all crypto-currencies. If you don't know what you are getting into, I would advis…

Ageism isn't a very compelling basis for an argument.

I can see how this can be seen as bad. Just, I don't think he is familiar with underlying technology and that is why he can't see how this will work. In a way this is ageism and I accept your criticism. But I still don't think he is right and understand this correctly.

Re: Vanguard Founder Jack Bogle Says ‘Avoid Bitcoin Like the Plague’

#98

Post by tptacek »

jozzas wrote: post #47
CPLX wrote: post #17

Earlier quoted context omitted.

There is a big difference. If you buy wheat futures and nobody wants to buy them, you can take delivery of a bunch of wheat. If you buy investment real estate and nobody wants it, you can live in it, or build things on it. If you buy stock in a random Fortune 500 company and nobody wants it, you can take possession of a bunch of desks or factories or inventory or whatever their deal is. And if you take possession of…

> If you buy stock in a random Fortune 500 company and nobody wants it, you can take possession of a bunch of desks or factories or inventory or whatever their deal is Not really, the value of the stock approaches zero, and when the company closes up shop I doubt you get anything at all as an investor. Assets would typically be sold to pay off outstanding debts.

More fundamentally, the value of a share of stock is tied to earnings. When companies accumulate capital beyond their horizon of their operational needs, they issue dividends.

Yes, companies can go out of business, but that's not the point Bogle is making. He's not saying stocks are riskless. He's saying that their valuations are tied to notional future earnings and the dividends they will generate.

Re: Vanguard Founder Jack Bogle Says ‘Avoid Bitcoin Like the Plague’

#99

Post by jorblumesea »

The biggest red flag is it's clear the exchanges don't have the liquidity for everyone to cash out. Since there are no banks to provide credit lines it's entirely dependent on people getting into the market to provide the fiat currency to cash out.

A run on these exchanges will destroy the value of bitcoins and cause a panic.

Re: Vanguard Founder Jack Bogle Says ‘Avoid Bitcoin Like the Plague’

#100

Post by econner »

ohhhlol wrote: post #57
econner wrote: post #35

Earlier quoted context omitted.

Yes, there's really nothing that gives Bitcoin value beyond new investors being willing to pay more for it than previous investors. Most people don't transact using it and the network is far too slow to support that use case anyway. It is a "store of value" that loses or gains half its value every few months. The community is torn with 3 separate forks & some of the earliest Bitcoiners have gone all in on Bitcoin Cas…

> most of the early Bitcoiners have gone all in on Bitcoin Cash. this is an absurdly untrue statement

Ok, "most" was the wrong word, but Roger Ver and Gavin Andresen were instrumental in the success of Bitcoin and they now support BCH.
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