A few years ago, some entrepreneur had a bright idea. He must have thought to himself, ‘Boy, silver and gold are far too expensive, and people want something cheap. I’ll make a coin that is a bit cheaper than gold or silver. I think, since it is a bit cheaper, I’ll call it ‘Bitcoin.’ I just made it up of course. I have no idea who got the idea of a cheap coin, or for that matter, when someone thought it up, nor where they were made. I don’t care. I’ve never even seen a Bitcoin. I know they’re made of a cheap base metal, and backed by nothing.
I subscribe to the Wall Street Journal, and every so often, there’s piece about Bitcoin, and how its value fluctuates wildly. Up and down, and I read a Journal headline recently that Bitcoin was $4,000! Maybe I misread the headline, and never read the piece because I have no interest in it. How in God’s green earth, can a base metal, un-backed, coin be worth $4,000, or even $400? Am I missing something here? I have a friend here in my town, who deals in old pennies, Indian Heads mainly. Danny buys and sells on E-bay, and says he doesn’t make much money on them, but it’s fun. I looked on E-bay, and sure enough an Indian Head penny can go from a couple of bucks to $450, depending on date and condition. The copper in an old penny is worth about three cents, which may be what a Bitcoin’s metal value is, but I don’t know about that even. Do Bitcoins have dates? Who knows?
All I do know, is that bullion gold and silver coins are made of real silver and gold, and are a small percentage above their actual cost to mine, mill, manufacture, and distribute. I also know that they are real money for thousands of years, and can be redeemed in any currency in the world. You then ask, “Hey Stott, why are you writing about something you know nothing about, and even admit to your total ignorance of the subject?” My answer is simple. I like real things. Real steam locomotives, carousels, antiques, cars, guns, books, and tangibles of all sorts, not fakes or imitations pretending to have value. Why would anyone not buy a tangible book, but read it on a screen? I think one can make a brand new Model A Ford from all the parts available, and exact copies of antique furniture and famous paintings also are regularly sold, but they are worth but a fraction of the real thing. My wife and I live in an authentic 1887 Victorian house, and it’s all original, not a fake. A brand new Victorian house can be built, but it is always obvious, and not worth the value of the real thing. People love Victorian architecture, but not where the real stuff is located, so they build new ones in the suburbs. Since I live in a small town, my home, and other Victorians have to stay where they are, since it is impossible to move them.
Fake, un-backed, made of cheap metal, Bitcoins, or others of its type, seem to have caught the interest of the investors in paper things such as stocks, bonds, futures, and currencies. If everything falls apart economically, where is the value of fake or un-backed anything? Before WW I, the German mark was worth a US quarter, and in America, an ounce of gold was $20.67. A year or so after the war was over, a wheelbarrow of German marks would buy a loaf of bread, and gold was so astronomical that it would have been a German joke. After WW I in America, the gold was still $20.67, as inflation had not yet occurred. As I said last week, I still have a $20 trillion Bank of Zimbabwe note on my desk.
Everyone says the stock market is way over-priced, and I have no idea, but I do know that a Bitcoin’s value can’t actually be worth more than the metal in it, and that has to be a couple of cents. People love to gamble, and a gambling addiction, I hear, is as bad as being addicted to alcohol or nicotine, nicotine being the most addictive drug there is, according to a book I have. Maybe there is a Bitcoin addiction. If so, better get over it. Colorado Gold has been around since 1977, and has always had an A plus Better Business Bureau rating. Try to find a BBB rating on a TV advertiser’s Ad, or how long they have been in business. As a Chinese would say, ‘rots of ruck.’ Don Stott – 1-888-786-8822