Seanzy

Yes, financial advisors are facing 2 major pain points about Bitcoin. First, it's too "risky" (too volatile). Second, it's too difficult to understand. Many advisors, even though they are fiduciaries, are reluctant to spend their time and energy to perform due diligence on Bitcoin on behalf of their clients. I believe it is their duty to do so. They don't want to risk being wrong because it requires them to stick their neck out and potentially disrupt their business' status quo. This is why my firm created the Bitcoin Picks and Shovels IRA Strategy . Our largest holding is MARA, which is up 60% this month. The strategy trades stocks and options related to Bitcoin for advisors and their clients. It also pay the advisor double the management fee they normally receive from clients. We make up for this by charging the client performance fees on the back end, but only if the client has positive returns or outperforms the benchmark. It's win-win. Clients benefit from indirect Bitcoin exposure that acts as an inflation hedge, without owning any Bitcoin directly. They also generate more income because we use options to capture volatility of the underlying stocks, such as MARA. I don't want to turn this into an unsolicited ad. Message me if anyone wants to learn more. We solve the above two pain points for advisors by providing free Bitcoin consulting to them and their clients every Tuesday night at 6:00 pm PST on Meetup.com. The strategy reduces the volatility of owning Bitcoin directly and improves the risk/return profiles of their overall portfolios by generating income. We are paying the advisors to solve their problems and do their investment management work for them. It's kind of hilarious, and completely unique. I used to provide trading, research, and operational support to a team of 3 financial advisors at the top branch of Wells Fargo Advisors, Private Client Group, in San Francisco. Now I run my own registered investment advisor firm. We are slowly gaining traction, but even independent advisors who don't need to worry about as many compliance issues regarding Bitcoin are overwhelmingly still reluctant to touch anything related to Bitcoin, including my firm's strategy, which solves their pain points. I am so grateful to all of you for your years of intelligent contributions on this forum and humbled by how hard running a business is.

Bitcoin is valuable because of its purchasing power. The same thing that backs the USD also backs Bitcoin, confidence. In the old days, you could take your $5 or $100 bill to the bank and redeem its equivalent value in physical gold. But that is no longer the case because there is not enough gold in the world, and because gold and the dollar were politically delinked by President FDR in the 1930's and Nixon in the 1970's. However, after this delinking occurred, people throughout the world continued to accept the physical greenback of USD, which is a just a piece of paper with no inherent value, as purchasing power. The truth is today, even in remote regions of the world, people are willing to provide goods and services to you in exchange for that physical piece of paper, because they are confident it will give them the purchasing power to buy goods and services they want and need. Everyone is confident everyone else will accept it as a form of purchasing power. Indirectly though, the USD is backed by the United States' gold reserves. Who owns the most physical gold in the world that is securely and privately held? The United States government. And who can best defend this gold reserve from attackers? Arguably, the United States military. And who can fund their military by printing more money? The US government. And who can be confident people throughout the world will continue to accept the dollar as a form of purchasing power, even if the dollar gets diluted by inflation? The US Government, because Americans are so economically productive that the government's tax revenues, which are the result of individual and business growth due to ingenuity, productivity, and control over natural resources, can pay off debts the government creates by its money printing. Few would accept Zimbabwe dollars as purchasing power because Zimbabwe lacks these. In other words, the world has good reasons to continue accepting the dollar as purchasing power. Not to mention that there is a tremendous demand for US dollars, because there is a tremendous amount of debt in the world's economy that must be paid back in USD. If your mortgage is in USD, you can't pay your mortgage in yen. You must first convert your yen to dollars. What happens if you don't pay your debts? It affects your credit and livelihood. So individual and business debts that must be paid back create a demand for US dollars, and thus US dollars are actually scarce. Perhaps, in a way, the USD is actually the most scarce fiat money, that's why it is the strongest relative to other currencies. Ultimately, the demand for US dollars is created by the need to pay dollar-denominated debts back and to obtain purchasing power for goods and services. And the US gold reserve, military, and productivity that "backs" our currency have one thing in common: they all require time, energy, and effort to obtain, whether that energy and effort is physical, emotional, spiritual, etc. You see, the original form of money, going back to when humans were tribal primates, was energy. If you wanted food, you had to expend energy to hunt and gather. If you wanted shelter, you had to build it from sticks and stones. You had to invent and develop tools to improve your purchasing power. Eventually, humans began representing energy with physical items like seashells and then eventually gold. Money began to represent the energy someone had expended to get the banana out of a tree, or time required to build a shelter and develop tools. Money is symbolic. Gold was a great form of money because it met many of the definitions of money: a store of value, medium of exchange, unit of account, transferable, divisible, durable, fungible, fraud resistant (if you could verify its authenticity), and scarce. Later, money technology improved to digital dollars like those we use today, which represented gold, which represented energy. In computer science, we can refer to fiat money as an "abstraction" for energy expenditure, similar to how the steering wheel, gas, and brake pedals of your car are a simple way to operate a complicated vehicle with many moving parts, or how the iPhone's touch screen simplifies the use of an incredibly complex technological device. These are abstractions for complicated but sound technology. It's easy to buy your Starbucks coffee with a credit card, but there are many technological steps that occur to make it happen. And finally, we arrive at Bitcoin, arguably the world's most technologically sound and advanced form of money ever created. It meets all the definitions of money, it is: A store of value: (it's a number on a website that says how much purchasing power you have, and it can't easily be changed because of the energy required to do so A medium of exchange: (I have a debit card that allows me to spend my Bitcoin and more merchants are accepting it daily A unit of account: all goods and services can be priced in terms of Bitcoin Transferable: it is digital, borderless, and almost frictionless, meaning it can be sent directly to anyone in the world via the internet without using an intermediary like a bank and without paying excessive fees (work in progress), which makes it arguably more transferable than gold Easily divisible: you don't have to buy 1 BTC at a time, you can buy 1 Satoshi, which represents one, one hundred millionth of a Bitcoin, thus better than gold which must be physically carried and divided Durable: gold doesn't tarnish, but Bitcoin cannot tarnish, and the network has operated nearly flawlessly, continuously, and reliably since inception Fungible: one Bitcoin is replaceable by another. Dollars may actually be cooler in this regard because some physical dollars have become collectors items for various reasons Fraud resistant: Bitcoin is a source of truth based on mathematics, computer verification, and publicly auditable code. The Bitcoin network has never been hacked, and the internet only requires a few computers anywhere on earth to connect to each other for the network to remain operational. Scarce: all goods and services have gone DOWN when priced in Bitcoin. From a performance perspective, 100% of negative predictions about Bitcoin have been wrong for 14 years. Perhaps it's time to allocate between 1 to 5% of your portfolio into this new asset class as a way to protect your purchasing power. Of course Bitcoin is volatile, but that's because it is priced in dollars. The mistake most investors make is keeping 100% of their wealth in US dollar denominated assets, i.e. stocks, bonds, cash, real estate, gold, etc. But what do we know will happen to dollars with certainty over time? They will lose purchasing power due to inflation. To me, that is risky. I see Bitcoin as a way to derisk your portfolio by allocating a small portion away from fiat based money systems. It is a rational decision at this point now that all of the world's largest institutions have purchased it, the US government is one of its largest holders, and its purchasing power has increased for 15 years. There has never been an asset bubble that lasted 15 years. Hopefully, this convinces some of the naysayers to start drinking a small cup of the Bitcoin Kool-aid. My clients understand the income I am generating for them result from the massive secular Bitcoin tailwind operating in the strategy's favor, and maybe I'm decent at what I do.

This is thought provoking indeed. Please add more details. Are you referring to Bitcoin and China disrupting the dollar hegemony, or am I misinterpreting?

I was thinking the same thing about this post.

@thepupil, question. If the company buys back shares at a terrible price way above intrinsic value, and the long-term shareholder does not wish to "reinvest" and chooses to sell shares equal to the repo, then is the company forcing the shareholder's hand in paying a potential capital gains tax? Does the shareholder have to decide whether or not he will earn a greater return by holding the stock than he would by reinvesting the after-tax proceeds in an alternative investment?

Does Buffett, Berkshire, or a subsidiary lend out shares?

Question: I remember reading Warren Buffett made money in gold and his rationale was that he was by buying it at a price below its cost to pull it out of the ground. Why was this sound investment reasoning? If cost to produce doesn't really affect value/market price of gold, then was he also anticipating some sort of rise in the price of gold?

JRM, I highly recommend reading "The Bitcoin Standard", in it, they discuss the ratio of stock to flow of gold, bitcoin, and others.

Hasn't Warren Buffett talked about this? Didn't he say a good protection against inflation is a high quality company with pricing power such as Hersheys or Coca Cola that can increase its prices and pass on inflationary costs to the consumer, without needing to worry so much about a loss of demand? He even talked about how return on equity is positively affected by such companies during inflationary periods. I think real estate has also done well historically, during periods of increasing interest rates. I remember seeing a chart about this, but I don't remember whether it was referring to real rates or nominal. Also, regarding GDP, why has no one mentioned the possibility of wages increasing? I keep hearing about inflation over and over in forums and on the news, but there is no mention of possible wage growth. Big companies and employers are more efficient now than ever. They have been reporting pretty decent earnings. Couldn't it be the case that many companies start increasing the wages of their employees over the next few years? Wouldn't this contribute to higher GDP, and to a gradual lowering of the Warren Buffett indicator (ratio of Wilshire 5000 to GDP), which is bound to mean revert? I am trying to figure out if our economy is a bubble about to burst, or if we are undergoing what Ray Dalio refers to as a "beautiful deleveraging", where fiscal austerity, debt monetization, wealth redistribution, and fiscal policy all contribute to gradually combat the long-term, secular decline that we seem to be undergoing right now. I believe consumers are experiencing inflation, whatever the numbers say, at least in terms of cost of living increases. Have you gone to the grocery store lately? Prices are higher than they were 6 months and one year ago. Shouldn't wages be increasing soon? Employees will start demanding them. There is evidence to support this here: https://tradingeconomics.com/united-states/wage-growth Maybe the Fed knows what it's doing, and that we should all have some faith that things will be okay. Also, bitcoin lol. Don't get me started.

Does anyone know of a free API to obtain historical stock prices that are adjusted?

“Our deepest fear is not that we are inadequate. Our deepest fear is that we are powerful beyond measure. It is our light, not our darkness that most frightens us. We ask ourselves, 'Who am I to be brilliant, gorgeous, talented, fabulous?' Actually, who are you not to be? You are a child of God. Your playing small does not serve the world. There is nothing enlightened about shrinking so that other people won't feel insecure around you. We are all meant to shine, as children do. We were born to make manifest the glory of God that is within us. It's not just in some of us; it's in everyone. And as we let our own light shine, we unconsciously give other people permission to do the same. As we are liberated from our own fear, our presence automatically liberates others.” -Marianne Williamson, Author, A Return to Love: Reflections on the Principles of "A Course in Miracles" The above quote was improperly attributed to many people, including Nelson Mandela, whose foundation admitted the quote should be attributed to Williamson. My other favorite quote: “To be nobody but yourself in a world which is doing its best, night and day, to make you everybody else - means to fight the hardest battle which any human being can fight; and never stop fighting.” -E. E. Cummings, American poet This is a beautifully structured quote and resonates with me very much. The last four words serve as a double entendre, perhaps even a verbally ironic one, because “and never stop fighting” can be interpreted as either a command from the author to never give up being yourself or as simply the ending to his definition of what it means to be yourself. I see some irony in these last four words, because the tone of the quote is one of exhaustion, but his command is to keep fighting anyway. It is almost as if he feels exhausted by being himself. Life is hard enough as it is, but to be nobody but yourself, well, that's exhausting. And so when he commands the reader to "never stop fighting", well he is saying something a little contrary to what it means to be yourself because fighting back at life would also be exhausting. The irony is that he is telling us that the feelings that come with fighting back at life are worth the exhaustion of being yourself. Or perhaps irony is the wrong word. Perhaps that's the message of this quote! Another thing I like about this quote is that the word "like"—ordinarily used for comparative purposes—is missing from this sentence where it is to be expected. When we speak, we would normally say, "to make you like everybody else", not "to make you everybody else". The author is doing a few things here. First, he is emphasizing the exhausting force of the world attempting to make us march to the beat of its own drum. He is saying there is no need to compare you to everybody else by using the word "like", because you are either being yourself, or you are everybody else. But this is exactly what makes this part of the quote so powerful. Second, by NOT using the word "like", he is subtly telling us to join the fight to be ourselves, in rebellion against the world, because when you interpret the last four words of the quote as a command, he is telling us to never stop fighting at being yourself. The moment you give up, you are (like)everybody else. But if you fight, then there is is no need to use "like" in this sentence, because you are not "like" everybody else. He isn't using the word "like", so he is obviously fighting the fight, and leading us by example. There's a Japanese proverb that goes, "The nail that sticks out shall be hammered down" that pretty much sums up the world we live in and highlights the importance of such powerful quotes to be ourselves.

A moat, or durable competitive advantage, is not so much about taste as it is about the cost to replicate equal earnings power and pricing power. Buffett has talked about this. He believes that even if he invested billions of dollars to create a cola that competes with Coca Cola, he would not be able to do it. This is because Coca Cola is one of the most recognized brand names in the world, and it is distributed everywhere. Coca Cola probably spends about $7,600 per minute on advertising. Even if restaurants agreed to sell a competitor to Coke or Pepsi in their soda fountains, they probably would not make as much money on it, on average, in the long run. Lack of long term distribution growth would eventually force them out of the market. This is because Coke, over the past five or six decades, has actually LOWERED the cost to purchase its syrup each year, as its business scaled in distribution, thereby making it less likely for someone to be able to compete with it. Regarding tastes, however, Buffett has mentioned that Coke has no "taste memory". If you drink tequila, you would get sick of it really quickly. Few people drink it before noon. But Coca Cola has no taste memory. You would be happy to drink it with an early lunch or throughout the day. You won't get sick of it. Lastly, your tastes are an exception, not the norm. Go ask 30 people if they enjoy drinking a coke at lunch, the movies, or a sporting event. Don't ask them if they actually do so. Ask them if they ENJOY doing so.

That's easy. A copy of "Think and Grow Rich", by Napoleon Hill. It's THE book to be successful.

THANKS!

Guys I would like to go to the meeting for my first time, although I've researched Buffett for eleven years. I am trying to get there from the San Francisco Bay Area and find lodging as cheaply as possible. Any advice? Thank you!

Download the app called "n-back". It helps you build and maintain your short term memory, reflexes, and dexterity with your fingers. It asks you a simple math problem like 8+4. You are then supposed to remember the last digit of the sum, so in this case it's "2" because 8 + 4 = 12. Then it asks you another math problem, but you are supposed to enter the 2 you remembered from before while committing to memory the current sum's second number for the next math problem. This repeats until you have completed ten math problems as quickly as possible in a timed format. It sounds complicated but it's not. It increases in difficulty based on the number of math problems you must remember. Just try it.

In 2014, I wrote a blog article about McEwen Mining (MUX) on SeekingAlpha.com. You can read it here: https://seekingalpha.com/instablog/17457762-seanzy/2675201-an-investment-idea-to-consider-mcewen-mining-mux On July 23, 2015, I purchased shares at $0.66 per share (the market cap was around $225 million). This was just about the lowest price it had been in ten years. More important than the price I paid, however, was the reasoning, thought process, and mental model behind my investment decision. I have been trying to understand Warren Buffett's investment decision making process for over ten years. I had been working two jobs and saving up every penny for an opportunity like MUX. This is not a recommendation, and I definitely did not want to give away my secret sauce at the time I wrote my article, but if you read it, you will see some of the major reasons why I believed MUX was such a bargain at $.66 per share.