“Do You Invest In Crypto-Currencies?” | FFLTV


– Short answer; no.
(chuckle) I don’t.
I would hesitate to call any
cryptocurrency an asset.
We did a podcast on this
with my friend Tom Kineshanko
where he argues that Bitcoin is an asset
because he says that it
is a piece of technology
rather than just a fiat currency.
I look at it a little bit differently.
Where I say cryptocurrencies aren’t
backed by anything.
Now some would say, well name an asset
that’s backed by something.
And I would say, companies, real estate.
Companies are backed by earnings.
Real estate is backed by… real estate.
So these are things that I invest in.
Cryptocurrencies have no cash flow
and they’re not backed in anything.
So you are purely speculating on the hope
that they will goup in value.
That’s not investing to me.
That’s gambling/speculating.
Now if you want to have a piece
of your portfolio reserved for either
high risk, speculative trading,
cause this really isn’t investing.
If we’re hoping something’s going to
go up in value, it’s not really investing.
We’re speculating at that point.
Investing means you’re going to hold
something for the long-term because
you are going to have
some cash flow from that.
That’s how I look at it.
Investing means cash flow.
So, cryptocurrency pays dividends.
No cryptocurrency is “profitable”
It is not spitting out cash flow, so you’re speculating.
so if you want to have a small piece of your portfolio reserved,
for more risky investments. I do this.
I do some options trading with a small piece of my portfolio.
But I’m not investing in cryptocurrencies because they’re not backed by anything.
There’s really no way to predict what is going to happen there.
It’s my opinion that it’s mostly driven by
buyer sentiment. So…
I won’t touch them. They’re completely speculative to me.
There’s no cash flow so there’s no reason for me
to be investing or buying crypto currencies. I have heard the argument
that some people buy them as a hedge. In the same way that
some will buy gold or silver. I buy silver…
I just buy the silver ETF. I don’t hold physical silver. I think that’s overblown and over-marketed and unnecessary.
But there are those who buy cryptocurrencies for the same reason that people buy
hard precious metals. Because
in the event of hyperinflation those are the types of things that people will flock into
and that will be a safe haven against inflation.
Okay, I guess I could get behind that if that’s your reasoning.
But don’t act like it’s investing. Don’t act like
it’s a wise investment
to have your, a large percentage of your portfolio in
an asset that isn’t even real.
You’re speculating by going into cryptocurrencies and that’s why I won’t touch them

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