“Worthless,” says Jamie Dimon, CEO of JP Morgan Chase. A “venereal disease,” says Charlie Munger, billionaire executive of Berkshire Hathaway, and one he is “proud” to have avoided. What are they talking about? Answer—cryptocurrencies.
Considering Berkshire Hathaway stock is up 5.6% over the past six months while bitcoin is down 56%, Munger is more than on to something. What was once hailed as a bank alternative for the underserved and a possible panacea for less developed countries with shoddy currencies apparently is no more. Crypto really does resemble a casino more and more.
A New York Post article and NBC Nightly News report from this past week both describe an emerging trend that appears more than just troubling. People are not only losing their proverbial shirts to the scheme—many are losing every dime they have. Suicides are predicted to climb. Scammers and hackers are wiping out what people think are real crypto accounts. But an explanation of what crypto is, and the pros and cons of the whole concept, this article is not.
An equally bad idea that is yet to take hold but must be headed off at the pass is this — no bailouts for crypto losses. Taxpayers should not be in the business of subsidizing people’s poor decisions. But before you say, “my representatives would never vote to do that,” think again. We subsidize failures, misfortune, bad decision making, and debt all the time.
Consider bankruptcy laws. While it is a strategy that need exist in some form, experts have said for years it is often too easy to wipe away careless financial decisions. A little more than a click of the fingers and some paperwork is all one need do in many cases. Sure, you’ll lose some points on your credit score for a few years, but that is hardly a deterrent.
Then there is the whole student loan mess. Evidently the “you took out a loan, you repay it” motto that has always been a hallmark value in this country is now just something selfish and angry out of touch conservatives believe these days. A once in a century pandemic did create bipartisan support for a short moratorium on repayment of loans, but that’s not good enough for leftists. They want most loans wiped off the books altogether. Already paid off your college loans or perhaps you took out a loan to start a company? Well, apparently, it’s just “TS” for you (tough situation).
And speaking of loans, Elon Musk’s recent tweet on the matter was brilliant for how succinctly he made a key point. Paraphrasing, Musk pondered why it is that a bank will hand over $100,000 to an 18-year old who wants to go study art history but not one seeking $15,000 to start a company. Even if one jumped through the hoops and endured the mind numbing paperwork, that latter loan will never gain approval.
And don’t forget all the stimulus money sent out. Three rounds totaled $6,400 for most households of two—much more for those with kids. We were told the money was to make people whole, so they could continue meeting their housing and food expenses. Yet leftists kept extending “you don’t have to pay any rent” schemes. This destroyed small landlords, even though the tenants were given cash for this purpose.
So, essentially, we’re left to wonder whether this Congress and the Biden Administration will ever, one, encourage work, personal saving, and investment in American enterprise and two, discourage sloth, financial carelessness, and speculative schemes like crypto. If we continue signaling that the federal government will be there as a crutch for every irresponsible decision one makes, we will bankrupt the federal treasury, and discourage appropriate risk taking ventures.
Don’t hold your breath on responsibility. When today’s crypto casualties start showing up in breadlines tomorrow, taxpayers may very well be on the hook to “help out.” Translation— it’ll be another socialist taking of money from those who worked hard redistributed to those who hardly worked. Margaret Thatcher had a retort for this decades ago: “The problem with socialism is that you eventually run out of other people’s money.”
Jeff Szymanski works in political communications at AMAC, a senior benefits organization with nearly 2.4 million members. He previously taught high school economics for 15 years.
“we will bankrupt the federal treasury” it could be argued that the treasury is already bankrupt.
Hate to break the news to people but we have been penniless since the vile azzwipe barack bankrupted America by his ‘extra one TRILLION’ every year of his budget..
And the equally Traitorous politicians who allowed a foreign muslim Communist to break America.
May you all be shot.
there are no independent sovereignties with multiple currencies. just territories, fallen governments and the like. multiple currencies imply the weaker is counterfeit. the idea at the heart is the weaker want to punish or overthrow the sovereign. unregistered stocks are a type of cryptocurrency. think of crypto as hidden or secret. so don’t ask hidden or secret of what?
No bail outs for crypto, no bailouts for bad non paying school courses.
“It’s not my fault” is the motto Progressives want naïve citizens to live by so they will continue to be dependent on a increasingly Socialistic government. This attitude has not survived a century in any nation. This is the new slavery.
none. there should be three options: prison, mental institutes, and poor farm. if you screw up your life then either fix it yourself of the government will put you in one of the three depending on your situation.
I don’t care is you are addicted to drugs. you thought you were cool in high school. now take all that cool and go rot in prison.
I don’t care if you put all your money in pork bellies and we all turned Jewish. Go get a second job.
i don’t care if you spent five years getting a degree in social science with a minor in women’s studies . Pay off your own student loans. go work two jobs for the next five years.
Your choices shoudl never be anyone else’s problem. When you make them into our issues we should be able to depend you be punished.
The only exception I will make is for people who have a family and the spouse dies. Then i think we should help.
Or those who were disabled on the job and had their retirement stolen by Wall Street while unable to defend themselves.
Until honesty returns to America, all bets are off.
WHEN DO I GET MY MONEY?
When hell freezes over, if you are too lazy or addicted to something other than working your way through life that’s not anyone’s problem but your own.
Tax an action or activity to get less of it.
DO NOT tax an action or activity to get more of it .
If it moves, tax it
If it doesn’t move, subsidize it until it does move, then tax it.
Don’t forget, The Revolution was fought over a One Cent tax on Tea, and Taxation without representation. This taxation WITH representation is not worth a darn either!
The Tea tax you’re referring to was more like 6 cents, but I get your point.
Where are you seeing representation here. Unless you are lazy, addicted to alcohol or some other mind altering drug or believe the nonsense that these so called socialist, communist and/or evil racist democrats are feeding you, then you have no representation
First few sentences says it all. Cryptocurrency takes power away from those in power. Whether cryptocurrency is good or bad, capitalistic or communists absolutely does not matter. The only thing that matters is some people’s power is being usurped.
Another Scheme just like Hussein Obama did with To Big To Fail giving Billions of taxpayers money to CEO’s for BONUSES while the AMERICAN people got a few Hundred bucks and RAISED TAXES for it.
NO COMPANY SHOULD BE BAILED OUT BY TAXPAYERS.
I would say that while I do not encourage nor do I discourage people from jumping in, I would like to highlight a few things and how I personally see the matter. First, not all cryptos are created equal. Personally, I have anywhere between 10-20% of my net worth invested in bitcoin (with a little bit in ethereum too). I would say that there is a decent chance that bitcoin ends up being a success despite the inherent volatility of all of the crypto asset class. But, of course, I also understand that there is a possibility that it all crashes to zero. I am relatively young and I am willing to take some risks. And to me it does make sense to take some risk because I spent the time to try to understand the asset class. I would note that back in the early days of the Internet, most people did not understand its value either and yet here we are using the Internet on a massive scale. Of course, there were many Internet companies that crashed and disappeared but then there are also technology titans that emerged as a result. So the future of the crypto space, while presently uncertain, may also have some value and a big upside potential.
Now, before making an objection and saying that “cryptos have no value, etc.” you may want to ask yourself if you spend the time trying to understand it. Usually, the people who speak against the space have done very little research and parrot each other’s opinions. One has to listen to the critics, but also to the proponents. Here in the article, the author has taken a decidedly one-sided, critical and negative approach. How about highlighting people like Michael Saylor, Jeff Booth, and a few others who are proponents? At least the readers can look those people up on YouTube, listen to their points of view and have a better understanding of pros and not just cons. You cannot highlight only the cons and pretend like there is nothing else.
Now, as I stated my position, I would like to reiterate again that I do not encourage nor do I discourage anybody from making any investment decisions. It is up to you. What I would encourage, however, is to have a broader point of view to look at the matters from different angles. Hopefully that’s not too much to ask. Cheers!
Your post is much more factually coherent and on point than the author’s rambling attempt to conflate a non-existent connection between something like federally provided student loans, which have fueled an explosive growth in unqualified student loans being issued (and corresponding federal debt obligation, which the American taxpayer is on the hook for), and the decision of participants in the free market to engage in crypto currency investment. Which everyone even moderated familiar with either the stock or bond markets or FX currency trading, understands is a completely speculative investment and not in any way either government insured or protected. I truly do hate when political consultants try to write about economic subjects, that they don’t readily understand in order to try and make some political point. It does a general disservice to the average reader that doesn’t understand the inaccuracies being conveyed as supposed fact.
I was expecting a much shorter article…
Same answer my father would have said – TOUGH SHlT!