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SFB095 Why We Should Talk, Part 2 - Should I Invest in Bitcoin?

| June 05, 2018
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Episode Summary

In part two of this 10 part series, Why We Should Talk, Paul and Cory are talking about the wildly popular cryptocurrency, Bitcoin and if you should consider investing your money in it. Paul and Cory also discuss speculation vs investing and the risks that come with implementing a speculation strategy.

What Was Covered

  • 02:50 - What is Bitcoin and cryptocurrency?
  • 05:58 - Bitcoin’s skyrocketing price
  • 08:18 - When people look at different opportunities to speculate in
  • 11:18 - Paul talks about two stocks he invested in where he speculated and things did not work out as planned
  • 15:23 - Paul explains what he means by speculation
  • 16:59 - How investing is different than speculation
  • 19:33 - Paul gives an example of using your human capital to enhance the performance of your financial capital
  • 23:04 - Is owning a business speculation or an investment?
  • 24:18 - Speculating on the value of your business vs investing in your business
  • 25:21 - If you are going to speculate, how much should you speculate?
  • 31:53 - Cory gives an example of when he speculated on a stock and got out of it

Tweetables

"Fundamentally, what Bitcoin and these other cryptocurrencies allow is a decentralized, non-governmental currency to allow people to change hands and really be able to, in someways, self escrow their own transactions."

"If you just put $100,000 in Bitcoin back in January 2013, now today you would have 1,000 times that. That would be $100 million dollars."

"Speculation looks great in hindsight against investing because when we’re looking at hindsight with speculation we’re never looking at the ones that didn’t work out."

"Speculation is when what you attempt to do is to go into something and how you’re going to make money is by that thing going up in value and you getting out of it."

"Anytime anyone is saying to you, “Your gonna get more than 8%” what you need to watch for is, “Where’s the risk that I don’t see?”"

"There is a way to invest, even in cryptocurrency, but how you invest is not by going to buy the coin.  How’d you have to invest is build value."

"First hard rule: Never more than 10% of your total asset base should be in speculation."

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