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Buffett bashes Bitcoin as nonproductive, thriving on mystique

reuters.com

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Re: Buffett bashes Bitcoin as nonproductive, thriving on mystique

#91

Post by thepangolino »

whack wrote: post #23

> Buffett said investors would instead be much better off investing in U.S. stocks, which in turn are also a far better investment than 10- or 30-year U.S. government bonds... He said he would much rather have Berkshire’s pile of cash and equivalents be $30 billion, rather than the $108.6 billion it was at the end of March, but good deals have not emerged. $100B is a colossal amount of money to have sitting around in…

As you said, $100B is a colossal amount of money. You can't get it in and out of the market like that. SPY, the most traded S&P500 ETF has a market cap of $230B.

Re: Buffett bashes Bitcoin as nonproductive, thriving on mystique

#92

Post by dnomad »

sizzzzlerz wrote: post #29

Buffet's investing strategy is, and has always been, look for the intrinsic value in a company, buy them, and then hold on forever. As part of that intrinsic value is the management teams that are running the companies. A strong team is as valuable as any other asset. When Buffet does buy a company, he'll generally leave management in place and not interfere in the day to day running of the company. Bitcoin has no ma…

I think this is basically it. Good ol' Buffet. His argument against gold is similar [1]. It's always interesting to note the fundamental differences between these types of investors. Some investors place their faith only in things -- hard assets and hard money -- gold, bonds, and now bitcoin. Others like Buffet have maintained that the best thing to invest in is other human beings, specifically human ingenuity and sweat. This question -- whether wealth resides in things or in relations between people -- seems to drive a lot of investor psychology.

[1] http://www.businessinsider.com/warren-buf

Re: Buffett bashes Bitcoin as nonproductive, thriving on mystique

#93

Post by jabits »

ggggtez wrote: post #69
trixie_ wrote: post #59

Earlier quoted context omitted.

Bitcoin has tons of intrinsic value unique to crypto currencies that traditional currencies lack. Most importantly it can't be created/destroyed at will by a central government. Huge sums can be transferred globally at the speed of light with very low fees. Can't do that with gold or cash. With normal currency a wire transfer costs money and moving a lot of money from a bank account usually takes days. Also you can s…

If you ever studied economics, you'd know that scarcity is not intrinsically valluable. It might be a useful feature, but intrinsic value means having a minimum value. Gold can't be created, but it had real usefulness in manufacturing. Besides, you could make a new buttcoin tomorrow, but you can't make a new kind of Atom. Stop proving that Bitcoin enthusiasts don't understand economics.

If you think gold can’t be created, you need to revisit your chemistry and physics books. While not economically feasible yet, with the mastery of fusion energy technologies it one day will be...

Re: Buffett bashes Bitcoin as nonproductive, thriving on mystique

#94

Post by jhall1468 »

bmcusick wrote: post #85
sizzzzlerz wrote: post #29

Buffet's investing strategy is, and has always been, look for the intrinsic value in a company, buy them, and then hold on forever. As part of that intrinsic value is the management teams that are running the companies. A strong team is as valuable as any other asset. When Buffet does buy a company, he'll generally leave management in place and not interfere in the day to day running of the company. Bitcoin has no ma…

Bingo. He's also a value investor. He understands cash flows. Bitcoin produces no cash flow. Also, Buffet is the insider's insider. Banks work for him. He has exactly a 0.00000% chance of having his accounts frozen. The US Congress would hesitate to pick fights with his companies. When you have those kind of connections and power, you're not well placed to understand the benefits decentralized sources of authority pr…

I think he understands it better than you give him credit for. He just doesn't see a future for it. To most investors the promise of Bitcoin is the same promise of snake oil.

Everything about Bitcoin is new and untested and most institutional investors abhor anything they can't quantify. Bitcoin is a huge gamble, and people like Gates and Buffet don't gamble.

Re: Buffett bashes Bitcoin as nonproductive, thriving on mystique

#95

Post by s73v3r_ »

triviatise wrote: post #9

He has always said he doesnt understand technology and has resisted investing in it. While the value is fluctuating heavily due to speculation, over time it will stabilize. Bitcoin will resist inflation and is somewhat out of control of governments or any central authority. People in countries where the govt has screwed up the currency can use it to get money out of the country or as a stable store even if dollars or…

"It is not unreasonable to argue that fiat currencies around the world are not stable because of inflationary monetary policies. Buffet always holds billions in cash which is constantly depreciating in value."

I would say that fiat currencies are quite predictable. The last thing the Fed, for instance, wants to do is to come out of left field and change things. That would be disastrous for markets.

Re: Buffett bashes Bitcoin as nonproductive, thriving on mystique

#96

Post by lolsal »

trixie_ wrote: post #59
sizzzzlerz wrote: post #29

Buffet's investing strategy is, and has always been, look for the intrinsic value in a company, buy them, and then hold on forever. As part of that intrinsic value is the management teams that are running the companies. A strong team is as valuable as any other asset. When Buffet does buy a company, he'll generally leave management in place and not interfere in the day to day running of the company. Bitcoin has no ma…

Bitcoin has tons of intrinsic value unique to crypto currencies that traditional currencies lack. Most importantly it can't be created/destroyed at will by a central government. Huge sums can be transferred globally at the speed of light with very low fees. Can't do that with gold or cash. With normal currency a wire transfer costs money and moving a lot of money from a bank account usually takes days. Also you can s…

I am largely ignorant to the details of BTC and other coins, but your comment seems incorrect.

> Most importantly it can't be created/destroyed at will by a central government.

Couldn't someone destroy/steal my BTC wallet though? I'd have no recourse for justice, right? Also, doesn't the Federal Reserve print money mostly at will?

> Huge sums can be transferred globally at the speed of light with very low fees.

I think the speed claim here is totally false[1].

> With normal currency a wire transfer costs money

Don't all BTC transactions have confirmation fees?

> and moving a lot of money from a bank account usually takes days.

This is true crypto currencies shine here. It can take 20 minutes to transfer $5 or $5,000,000.

> The electricity it takes to maintain it is nothing compared to the rest of the banking system.

Maybe, but also maybe not. The rest of the banking system provides lots of services and protections that crypto currencies don't.

> These properties are the very nature of crypto, that's why it's intrinsic.

These are properties of crypto currencies for sure, but that these are valuable properties is entirely subjective.

[1] - https://blockchain.info/charts/avg-confirmation-time

Re: Buffett bashes Bitcoin as nonproductive, thriving on mystique

#97

Post by hapnin »

s73v3r_ wrote: post #75
hapnin wrote: post #72

This is like two old investors in buggy whips talking scaring people off of internal combustion engines. They have no idea what they're looking at but they'll make pronouncements anyway. Bitcoin etc are currencies native to the network environment just as cash is native to the meatspace. Both have their advantages and shortcomings. Wisdom is found in using things if they serve you and leaving them alone if they don't…

"I don't find it wise for anyone, Buffett or otherwise, to expound on things they don't know anything about." He's talking about investment vehicles. I would say he knows more about those than most of us here on this board.

Everyone that listened to him 20 years ago missed Amazon, Google, etc.

Re: Buffett bashes Bitcoin as nonproductive, thriving on mystique

#98

Post by kolbe »

ThalesX wrote: post #86
kolbe wrote: post #62

Earlier quoted context omitted.

This is totally reasonable, and I get why Warren should stay away from 'investments' in BTC. It's extremely wise to stay away from investments you don't understand, especially when you're a target like Buffett. But what I can't get behind is his active and vocal bearishness. If he has a well-reasoned argument to make, then he should make it. If not, lay off.

I’m not a succesfull investor with decades of won bets but the amount of people pitching Bitcoin to me and wanting to talk about it drove me crazy for awhile. I can’t imagine the frustration Warren Buffet feels when surrounded on all sides by digital snake oil peddlers.

Well, my point is that Buffett usually just uses some sound byte to bash it, like 'rat poison squared'. Give us an actual argument. Or convince us that he's done significant research into BTC to come to this conclusion. It's just frustrating to hear him make a very outlandish claim like this, and then not educate us with the explanation.

Re: Buffett bashes Bitcoin as nonproductive, thriving on mystique

#99

Post by throwaway5752 »

Berkshire vice chairman and longtime Buffett confidant Charlie Munger was even more blunt.

"I like cryptocurrencies a lot less than you do," Munger said to Buffett. "To me, it's just dementia. It's like somebody else is trading turds and you decide you can't be left out."

http://money.cnn.com/2018/05/07/investing/warren-buffett-bit...

Re: Buffett bashes Bitcoin as nonproductive, thriving on mystique

#100

Post by jhall1468 »

jabits wrote: post #93
ggggtez wrote: post #69

Earlier quoted context omitted.

If you ever studied economics, you'd know that scarcity is not intrinsically valluable. It might be a useful feature, but intrinsic value means having a minimum value. Gold can't be created, but it had real usefulness in manufacturing. Besides, you could make a new buttcoin tomorrow, but you can't make a new kind of Atom. Stop proving that Bitcoin enthusiasts don't understand economics.

If you think gold can’t be created, you need to revisit your chemistry and physics books. While not economically feasible yet, with the mastery of fusion energy technologies it one day will be...

It can't be created practically which is the same as can't be created for purposes of this discussion. Talking about creating something using a tool that we haven't even created is futurism.
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