The bubble escalates. As of Friday, December 15, 2017, a brass coin was selling for over $19,000. A coin which has no physical value, as do gold and silver coins. Why do gold and silver coins have value? Because they require capital, machinery, exploration, etc. to produce, and their rarity has caused gold and silver to be actual money throughout history. Robert Service wrote marvelous poetry about “That Muck called gold,” and other choice verses about the gold rush in Alaska. The 1849 gold rush in California, caused thousands to flee their jobs and families to hunt for gold, and the same happened in Colorado, which still has many dozens of ‘ghost towns;’ their remains and abandonments caused by the vein running out, and miners leaving, searching for other underground gold evidences. The continual search for gold and silver is not a ‘bubble’, but a constant search for real wealth, as opposed to things such as the tulipmania of 1637.
Another example of a historic bubble, is the South Sea Company, which was formed in 1711, and promised investors huge success similar to the East India Company. It told investors that like the East India Company, the new South Sea Company would make England control all the trade in what is now South America. Shares went up over 800% before collapsing.
Perhaps Japan’s real estate and stock bubble could be mentioned. In the early 1980’s, the Japanese yen jumped 50% almost overnight, and this triggered a recession in 1986. The government decided to fix that by pumping in huge amounts of yen into the Jap economy, which was similar to America’s doing the same thing. In Japan, the same thing happened as in America, with real estate and stock prices rushing up and then rushing down, causing billions to be lost.
The “Dot-Com Bubble” here in the U.S., occurred when Al Gore invented the internet, if you will excuse another lie. Technical stocks are usually listed on the NASDAQ, and when internet companies were formed by the many dozens, the NASDAQ quickly went from 500 in 1990, to over 5,000 by March of 2000, then went bust. More losses for investors. I’ve already mentioned the housing bubble.
The bitcoin sham will go down in history as one of the biggest, I am certain. Why? Because there are no valid reasons for it to even exist, any more than Monopoly Money, other than as a game to play. Maybe someone should in vent a board game named “Bitcoin.” Housing, an internet company, a trading company trading physical goods, gold, silver, or anything which has tangible value, are legitimate trading reasons for items. I personally prefer my home and my own physical gold and silver, because it isn’t a promise which may be fictitious or grossly exaggerated. Bitcoin is merely a pretty coin with nothing in back of it, and it is valueless. It promises nothing, has no metal or government backing, has no dollar, yen, euro, or other value to allow trading with it. It’s a fluff and a sham, which has attracted fools. From a couple of bucks to over $19,000 in a few years? Why? The answer is really quite simple. A bubble of any kind bursts, when there are more sellers of an item than there are buyers, regardless of what it is, be it stocks, tulip bulbs, real estate, or even gold and silver. When the economic bubble burst here in 2008, it took everything down!
Investors in anything, should be concerned about the actual cost involved to produce the bubble. Real estate is a physical, factual thing, which can be lived in and cost a lot to build. Gold and silver cannot be created by printing stocks or paper currencies. Bitcoin can be created by running a mint, regardless of the shallow promises of its creator. Bitcoin is a rainbow which will disappear as quickly as when there are more sellers than buyers. Why should anyone buy bitcoin? Because it’s “going up,” and its sellers and pushers are telling the weak minded that it will continue to “go up.” Why should it go up? It has no value. When will it go down? When there are more sellers than buyers, and I cannot see why anyone is buying something that has no value at all in the first place. If I bought bitcoin at less than they are now, I’d be the first in line to sell before there are more sellers than buyers of this fraud. Only my opinion! – Don Stott – 1-888-786-8822