Speculative mania…or once in a lifetime opportunity?

Wednesday, 13 December 2017
Melbourne, Australia
By Bernd Struben

  • Don’t do this!
  • Before investing in any crypto, read these
  • Receive the Port Phillip Insider…for life!
  • In today’s Australian Tribune

RBA governor Philip Lowe is no fan of bitcoin.

That news is about as shocking as hearing that Donald Trump isn’t a big admirer of Hillary Clinton.

Bitcoin, and cryptos in general, are proving to be a big headache for central and commercial bankers. They’ve grown accustomed to their monopoly over the control of currencies for the better part of a century.

Not only the supply of these currencies. But control over international money transfers. Bitcoin threatens all of that.

And Lowe, in typical central banker form, was quick to try and tie bitcoin to criminal activity.

From The Australian Financial Review (AFR):

Reserve Bank governor Philip Lowe said bitcoin was a “speculative mania” that was unlikely to become an everyday method for making payments, although it would be attractive to criminals.

In a rare speech on banking technology on Wednesday, Dr Lowe launched an attack on bitcoin, whose price has soared dramatically in recent months and is currently trading above $US17,000 as speculators have piled in to the cryptocurrency…

“When thought of purely as a payment instrument, it seems more likely to be attractive to those who want to make transactions in the black or illegal economy, rather than everyday transactions,” he said.’

The refrain that bitcoin enables black market activity is intended to alarm. It’s the same line Australia’s Black Economy Task Force trots out to tarnish cash transactions.

The reality is that bitcoin’s distributed ledger system — the blockchain — tracks and verifies every transaction. Meaning that it’s not really anonymous at all. At least not to powerful government agencies determined to uncover users’ identities.

In that respect, cash is still king.

Lowe was correct in pointing out one concern, though. The energy costs of mining new bitcoins and verifying existing bitcoin transactions are going through the roof.

Estimates vary. But ABC News reckons it’s more than the electricity use in all of New Zealand.

You can likely see where this is going. Keep an eye out for headlines like, ‘Environmentalists unite against bitcoin’.

A headline that may well be followed by, ‘Bitcoin soars to new record highs’.

More after the markets.

Markets

Overnight, the Dow Jones Industrial Average closed up 118.77 points, or 0.49%.

The S&P 500 rose 4.12 points, or 0.15%.

In Europe, the Euro Stoxx 50 index finished up 18.14 points, or 0.51%. Meanwhile, the FTSE 100 gained 0.63%, and Germany’s DAX rose 59.88 points, or 0.46%.

In Asian markets, Japan’s Nikkei 225 index is down 148.93 points, or 0.65%. And China’s CSI 300 is down 0.14%.

In Australia, the S&P/ASX 200 is down 3.20 points, or 0.05%.

On the commodities markets, West Texas Intermediate crude oil is US$57.43 per barrel. Brent crude is US$63.34 per barrel.

Gold is trading for US$1,243.77 (AU$1,646.29) per troy ounce. Silver is US$15.73 (AU$20.82) per troy ounce.

One bitcoin is worth US$17,187.57.

The Aussie dollar is worth 75.55 US cents.

Don’t do this!

Philip Lowe may be down on bitcoin. But investors in the digital currency can’t seem to get enough.

At time of writing bitcoin is trading for US$17,187.57. That’s up from US$997.69 on 1 January. Or a gain of 1,622% so far this year.

Hopefully you followed crypto experts Sam Volkering and Ryan Dinse’s advice and got in for some of those gains. I also hope you followed their words of caution and did not invest more than you can afford to lose. And certainly did not take on any debt to buy bitcoin.

Unfortunately, far too many people are throwing caution to the wind. And leaving themselves exposed to a nasty shock, should bitcoin take a tumble.

CNBC reports that Americans are even taking out mortgages to buy bitcoin. As the AFR reports:

“Bitcoin is in the ‘mania phase’, with some people even borrowing money to get in on the action,” Joseph Borg, president of the North American Securities Administrators Association, told CNBC.

“We’ve seen mortgages being taken out to buy bitcoin. … People do credit cards, equity lines,” said Borg, who is also director of the Alabama Securities Commission.

Look, the opportunities in the crypto market are massive. But at the end of the day it’s up to you whether to invest in cryptos. And if so, how much to invest.

Just never lose sight of their extreme volatility.

Bitcoin has already dropped more than 25% in value three times this year. Sure, it came screaming back to new highs. But there’s no guarantee it will do so next time.

Treat bitcoin as you would any highly speculative investment, like buying shares in a small-cap startup. And never bet the house!

Before investing in any crypto, read these

Port Phillip Publishing now has three advisory services dedicated to cryptocurrencies.

Sam Volkering’s Secret Crypto Network is our entry level service. It gives you all the background information you need to start your crypto journey. And Sam makes recommendations for promising new cryptos here as well.

Sam Volkering’s Crypto Tech Investor take this to the next level. Here Sam focusses on initial coin offerings (ICOs) and brand new cryptos. Ones you and I have almost certainly never heard of.

The risk here dwarfs that of bitcoin…if you go in blind. But if you know what you’re doing — and Sam does — you can greatly reduce that risk. And see some truly staggering returns.

Like ShadowCash, which gained 724% in a single day on 23 November.

Or KashhCoin, which shot up 1,755% that same day. Take that bitcoin!

Our newest crypto investing service, Ryan Dinse’s Extreme Crypto Trader, only launched last week, on 5 December.

In this service, Ryan uses a cutting-edge approach to buying and selling cryptos. He calls it Flip Trading. A method no one else in the world, to my knowledge, comes close to.

By Flip Trading, Ryan aims to increase the gains you make from cryptocurrencies by a factor of 18-to-1.

If you’re looking for the best chance of making life changing wealth from cryptocurrencies, all three of these new investment services should be on your Christmas wish list.

But as Crypto Tech Investor and Extreme Crypto Trader are both premium services, the combined cost will set you back a bit. To the tune of $5,577 for a one year subscription to all three services.

Now with the massive potential gains up for grabs, that’s still a bargain for all three services.

However, for not much more, you can gain access to all three crypto investment advisory services for life. And you can even bequeath them to your kids or grandkids in your Will.

That’s because they form part of our Alliance Partnership. Along with 16 other paid investment advisories, encompassing all of our editors and analysts.

(Details here.)

If you subscribed to each of those 19 services separately, it would run you about $25,000 for one year.

A lifetime Alliance Partnership costs less than that. A lot less. And it includes every new service Port Phillip Publishing launches in the future.

But not only that…

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In today’s Australian Tribune:Democrat Senator Stretches the Meaning of “Sexist Smear” in Trump Accusation’

If the US democrats — or anyone — believe Trump will resign over sexual harassment allegations, they know nothing about the US president.

Trump denies the allegations. And in typical form, he refuses to apologise, saying the stories are fabrications. And there is some evidence to back this up.

But the Democrats, still stinging from the unexpected loss of their star player, Hillary Clinton, are pressing full steam ahead.

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Cheers,
Bernd