Simba

100% agree. Some of my random musings on BTC... 1. There is enough people (i.e. demand), today, to support a price of $50,000. As that is the price. 2. While BTC has no intrinsic value, it's network effects are immense, one can even argue reflexivity is happening 3. PayPal and Square, two major fintech companies have entered the space. It is only a matter of time as others follow. 4. Will Bitcoin ever reach $0? Do you think the probability of reaching $0, is higher than lower than 1 year ago, 3 years ago, 5 years ago? Every day that passes by, that user adoption increases, that technology increases, etc...Or is the probability decreasing every day that BTC goes to 0$? 5. How does one play bitcoin? By the time BTC gets full adoption, there will be no upside. Putting 1% of your portfolio, will that really make a difference to it? 6. In order for TSLA to buy $1.5B of bitcoin, they clearly was a lot of thought that went into it. The complete 180 in 3 months time, suggests internally they were some discussions going on. (Perhaps at the Board level?) 7. Have we reached the tipping points, where BTC/ETH has won the crypto? History says otherwise. I still don't see why an alternative, better BTC, can't come up.

Interesting concept. Clearly BTC/ETH have some incredible network effects at the moment. No doubt about that. IMO one aspect of bitcoins network effect is that it is heavily tied to it sustaining high returns. Higher returns beget new users, which results in higher returns, and it becomes a virtuous cycle upwards, a bit of what we are seeing today. (This is an oversimplification as obviously the technology is evolving, and more innovation / fintech / corporations have accepted crypto since BTC was first introduced) I predict that Bitcoin will require more and more user adoption (i.e. institutions) to sustain higher and higher prices. There are only 21M coins so it's a closed loop. I know none of us have the answer - but it seems almost too perfect if bitcoin becomes the winning crypto say in 2030. Elon Musk (as silly as he seems) has poked some legitimate holes in the bitcoin long thesis in recent days. I personally think were reaching a top in the next 12-24 months, if we have not reached it already. The crypto / NFT space is so red hot, it would really astonish me if these assets still go up another 200-300% from here. Maybe there is really that much money in the system, but I don't think so. Every asset class eventually tops when it is not supported by fundamentals. This goes for gold, real estate, stocks, bonds, etc. I don't see why crypto would not face the same fundamentals as other asset classes. Right now, so many people think crypto can never fail. To quote Sir John Templeton, “The four most dangerous words in investing are: this time it's different.”

And the Dogefather has spoken... . Tesla suspended vehicle purchases with Bitcoin. Concerned about the environmental factors of BTC. Looking at other cryptocurrencies that uses 1% of the energy BTC does.

"Do you want Tesla to accept Doge?" - Elon Musk (May 11 2021)

I understand DOGE is a meme investment with no inherent value, but I still feel there is money to be made, be it long or short. What's the difference between bitcoin, dogecoin and gold? To me BTC / DOGE are nearly interchangeable save for the network effects of bitcoin and the non constant dilution of DOGE?

DOGECOIN What started off as a meme, is now close to a $100B currency. What is everyone's thoughts of DOGE as an investable asset class. Is it prudent to start allocating capital to DOGE? A buy the dip opportunity? It looks like DOGE is slowly becoming the new BITCOIN. What are everyone's thoughts? LONG? SHORT? STAY ON THE SIDELINES? I think the biggest issue is the 5% inflation - that affects the share count just like SBC. What is Dogecoin? Dogecoin features the face of the Shiba Inu dog from the "Doge" meme as its logo and namesake. It is used as a tipping system Supply: Initial 100 Billion coins, growing at 5 billion a year (5% inflation) - i.e. will take 20 years to double supply (currently 129.5B dogecoins in supply) Timeline: Dec 2013: Dogecoin was born Jan 2018: Dogecoin hits $2B market cap, peaking at $0.017 during the height of the crypto bubble July 2020: Doge gets hype on Tiktok and price starts to spike Jan-March 2021: Elon/Snoop Dogg/Gene Simmons encourage Doge April 2021: Coinbase IPO May 2021: Dogecoin hits $85B+ market cap Price Statistics: Dogecoin Price: $0.68 Market Cap: $88.0B 52-Week Low / High: $0.002277 - $0.7376

Why do you think were going to 6%? Check out historical inflation, consumer prices for the United States here: https://fred.stlouisfed.org/series/FPCPITOTLZGUSA Inflation has been steady for the last 10, 20 if not 30 years. Going forward, things can change, but why? But to answer your question if inflation goes to 6%, rates will rise, and will ultimately lead to an economic recession.

Chamath claims to be beating the benchmark by 56% (3.6-2.3%) FYI if your benchmark is returning 0% and your return is 1%, your beating the benchmark by 1/0 = infinite

Some names starting to look interesting - I do feel we have another leg down unfortunately. I think we get a bounce the next couple days, and then a final leg down. Today felt like mini-capitulation

Was that is? Did we hit the interim peak for 2021? I guess ELON YOLO'ing on Bitcoin was the peak indicator. SMH :-\

Didn’t Elon Musk say Tesla price was too high at one point too?

This market is nuts. One segment of the market people are investing on p/s ratio and TAMs.. it's nuts .. eventually gravity will weigh on the overvalued and make the overvalued fairly valued I still believe (and hope) that in the long run, the market is like a weighing machine--assessing the substance of a company.

On trimming winners. I’ve struggled with it. I’ve left a lot of money selling early. I’m going to try letting winners ride this year

WSB and Short Squeeze and Tilray and Shorting Tilray Yup. That’s enough for me to pass lol. Sorry man. Interesting arb opportunity tho

That's what I struggle with. Sure, I will accept we are in a bubble but what do you do with that assumption? Invest in value assets in hopes they don't crash as hard when the bubble pops? Or go hard and play the EV/Crypto/SPAC roulette while it's still hot in an attempt to juice gains before the crash? Find the upside without downside plays. Pabrai loaded up on Silicon Valley Bank in 2000 because it had warrants from dot com startups that weren't showing on the books. Ya I’m sure there are some asymmetric bets in the market today, just got to find them. My current way of playing it, is first be careful of the risks of overinflated assets. My way to not get caught up is simply not buying GameStop, not buying NIO, not buying the 0 revenue 50 billion market cap company. I don’t think many on this board have a significant % of portfolio in these names but many people on Reddit’s portfolio is filled with 0 revenue multi billion dollar lithium or EV or garbage concept stock. So avoid the very very obvious overvalued plays. In terms of tilts, (either sector or style) it’s a good point you bring up. I think if you invest how one should invest (thinking of value in terms of future cash flows) and not based on a PR of lithium, EV, bitcoin, if there was a broader correction at least you won’t be hit as bad as the overinflated names. I’m assuming these overinflated names have a beta > 1 so you should be hit less In terms of pure profiting from a correction, you can buy puts, place shorts, sector tilt, etc.

I generally looked at how other fund managers did it and just copied them. Go find some highly rated mutual fund managers for a good idea. You’ll often notice they are diversified and never go all in gangbusters on a play (cough: ARK). You’ll also see generally a lack of turnover. You can find investment letters and videos and see how other fund managers invest. I haven’t seen any books, if you see some do share what you find. Kelly Criterion simply reinforces not to go 100% in any position as your risk of ruin is high. It teaches you an optimal ratio (which most find is too high). Also Some people here have given good advice on how they see positioning sizing. To add to the discussion, you can maintain an excel spreadsheet with your portfolio weights, and update accordingly. Helps when you actually visually see what weights are where

I mean the signs of a market peak are certainly there. This time around it’s looking more in the less established space (would say Small Caps). Here are the signs of a looming market top - Famous celebrities and musicians are starting SPACs - Famous celebrities are finance gurus - Tesla buying Bitcoin to reinforce the circularity - GameStop (and 50% of ppl thinking it was going to $1000) - Pokémon Craze 2.0 - Sports cards craze 2.0 - Multiples have shifted from EBITDA to Revenue - Citron exiting short research - Getting massive moves in various parts of the market (its Lithium one day, then EV the next day, then some Chinese play, then NIO, then back to some BS concept stock) Bubbles can last 1-2 or 20 or maybe even 100 years, in the long run we’re all dead anyways Maybe bitcoin gets to 100 million before going to 0. I wouldn’t dare go to cash but if you look back at 2021 say in 5 years, and someone said what were the signs (insert EV/CRYPTO/SPAC play), it was pretty obvious

I disagree. And is also why I didn't buy small caps in March of 2020. In March of 2020, there was a lot of possibilities of how the virus could of panned out, and how governments (And Central Banks) around the world would react. In 2009, it was clear small caps were going to recover as it a was a financial crisis. 2020 was a biological crisis.. if you had a 5-year timeframe in March 2020 sure you could of risked it, but there was a chance the markets would go down another 10-30% from the March lows (considering the market was crashing -10% everyday we were probably only 2-3 days away from this scenario, anyways)

I think were just getting started. It's more like the Spring of 1999 or Fall of 1998. Going to be highly amusing. 8) Will end in tears as it always does, not a matter of if, but just a matter of when. 8)

Meh. I'll take the contrarion bet. I'm seeing a lot of behavioral / misinformation all over the internet on the stock market in calling it a bubble, it's incredible, which leads me to believe the "general market" is not in a bubble (of course you have some stupid SPAC or non-profitable company) - which is a separate topic of discussion. Here are my 2021 predictions 1. Elon Musk becomes first Trillionaire in 2021 2. You will have multiple "Gamestop" stories in 2021 3. WSB is going to get even more attention in 2021 than 2020. 4. The market is not in a bubble. Keep calm and carry on.

All assets have become distorted. It's not just stocks and crypto. It's literally everywhere. I'm even skeptical if this "gambling" market even dies out. Why would WSB end?

Is there a sweet spot market cap threshold? How does one explain Tesla?

To be fair the FANG stocks are up a lot (AMZN +71%, AAPL +76%, GOOG +28%, NFLX + ~64%, MSFT +38%, FB +30%) for the year. I agree with you there are a lot of air pockets out there - those with more investment experience will invest accordingly. History can show us what to avoid, even if it does not teach us what to do — by showing the most common mistakes that mankind is apt to make and to repeat.

+1 In my view, the market will stay expensive and "investors" will continue to speculate until the time comes when companies can fail again. The only way I see that happening is for the Fed to lose control, i.e. when inflation picks up to the point where investors in Treasury bonds demand higher rates to compensate for this. The Fed can't continue to force yields lower at this point by printing money, because this will only increase inflation expectations, and cause investors to demand an even higher yield as compensation. It will be a self-reinforcing fly-wheel, and a very ugly one at that. 100%. This is the dynamic that I simply can't wrap my head around. It amazes me that we are living in a world where everyone seems to believe inflation will remain low forever and interest rates will never go up again. If and/or when this changes, it will be the game changer for market valuations... suddenly gravity turns back on. I just don't know if it will happen in 1 year or in 20 years, but like you said, it has the potential to spiral out of control, and this is a good enough reason for me to play the game slightly cautiously for now. Investors said the same thing in early 2010s. I've heard this before.

I'm a believer that many stock prices that are listed no longer represent future cash flows of the Company (using appropriate discount rate). Many stocks share the same valuation characteristics as antiques. It's very debatable whether these stocks will generate enough CF to sustain their current valuation, and what a rational investor would pay if they modelled future CF in excel. I own many antiques, and they are quite valuable - I enjoy them and plan to keep them - knowing full well they do not have an intrinsic value of what they sell for. Bitcoin is the poster-child of this era's discrepancy in intrinsic values from typical valuation models (e.g. discounted cash flow).