Here, I want you to look at this.
I plotted out average Bitcoin prices for these years.
Let’s extrapolate with some hedge room.
Now, would you accept that as a return for any Bitcoin you have now?
I think you would be crazy not to.
So then why doesn’t everyone do this?
For the same reason I didn’t do it with stocks: I got scared.
We see the troughs that bitcoin goes through when it plunges. Plus, the media scares the daylights out of us.
No one can scare you like the media.
Whether it’s enlarging sunspots, Joro spiders parachuting down into your community, Y2K, or any other type of calamity they happen to dream up, nobody can scare you like the media.
Don’t forget about the near-miss asteroids.
The media’s programming of fear is relentless.
Fortunately, none of these issues the media warned us about was of any significant consequence.
Generally speaking, the stock market and Bitcoin have recovered from tremendous losses before.
This isn’t to say that you shouldn’t look into things when the media begins scaring you.
What I’m trying to tell you is that things aren’t always as bad or as good as they seem to be.
The media has a way of always looking on the upside when the markets are up, and always looking on the bad side when the markets are down.
If you want to be a successful investor you have to employ equanimity.
I invested in $51,000 in cryptocurrency the past year. I have converted all of that into Bitcoin. My net investment is now worth about $21,000.
That looks like a bad deal, right?
It looks like I should sell, especially since they are predicting that Bitcoin will fall to $7000.
Well, even if they do I’m going to have to stay in for the ride.
That’s what I did about a decade ago when I invested in Las Vegas Sands. I purchased Las Vegas Sands as it was plummeting.
The reason I kept buying was because I believed in the product. I would stay at the Venetian all the time before and after the 2008 collapse.
It was my home away from home.
I knew they had a good product. I knew they had a future. I read the income statements and balance sheets. I knew they were expanding throughout Asia. I would listen to Sheldon Adelson on conference calls. He didn’t seem worried at all. He remarked sardonically on one conference call that the media thought that his company was going to hell in a hand basket.
Obviously he was of a different opinion.
I kept buying into Las Vegas Sands because I had confidence in him and the company.
That is what calmed my media-induced fears.
I feel the same way about Bitcoin.
Now, of course, there is no CEO of Bitcoin that I can listen to on a conference call.
But I can listen to people who know more than me, people like Max Kaiser and Michael Saylor.
They don’t seem worried, and I assume that they have large investments in Bitcoin, just like Sheldon Adelson had a large investment in Las Vegas Sands.
Listening to their arguments, what they say seems to make sense to me.
Now, I don’t think that Bitcoin will have the huge returns that it did early on, but I still think there is room for significant growth.
There is even more room for growth when Bitcoin plunges some more.
Will I buy more, if Bitcoin plunges to $7000?
Probably not because I’ve already exceeded the limit that I have set for myself when investing in any particular stock or asset class.
Just because I have confidence in something doesn’t mean I’m going to bet my whole fortune on it.
Now if you were asking me to bet on my Pediatric practice, of course I would invest in it. It’s mine. And I get to call the shots on what I do on an every day basis.
Unfortunately, for Bitcoin, there are a lot of enemies out there who can do a lot of damage to it.
I can’t control all those factors.
Nor can I ever afford to underestimate the ruthlessness and greed of the misguided power elite who currently view Bitcoin as an enemy. There is a reason why the power elite are rich, and that reason is not altruism.
Nevertheless, I think the future for Bitcoin is bright, regardless of the fear the media conjures up.
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