Crypto Geniuses Who Vaporized a Trillion Dollars
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The ultimate con --- selling virtual bridges made of electrons to rubes who had been convinced that their powers of observation were superior to all those others who just didn't "get it".
It's pretty much enough to look into the time of birth of the Bitcoin and you can see what was the first purpose ot cryptocurrencies. If some morons lose money on get rich fast schemes, it's on them.
Where does this distrust come from? Central Banks have been running QE for ages (the Fed since the GFC 2008, BoJ even earlier), and inflation has been fine for decades (too low, rather).
Now, in exceptional circumstances (pandemic and war and supply chain problems due to those and fiscal easing) there's a short spike of inflation that's brought inflation averaged over a decade just a tad over the 2% goal. Where's the "irresponsibility"?
The key word is "symptom" --- not to be confused with "cure".
The ... banks?
... irresponsibly?
The only thing restraining the creation of crypto is the fact that it is virtually unusable as an actual currency. If it were otherwise, every celebrity, politician and corporation would just mint their own continuous stream of the stuff. There is nothing to stop them.
Productive work would become obsolete. Why work to "earn" money when you can just mint it? A lot of life's major problems could be solved instantly by crypto. If you buy this, I've got some crypto to sell you.
You’re failing to realize that value is socially derived.
You're failing to realize that lots of people/companies have a larger social presence than Satoshi Nakamoto and are thus in a much stronger position to derive value from their own crypto.
But most of these have had the good sense thus far to avoid crypto scams due to the potential legal issues. Kim Kardashian being one example of a prominent exception.
https://decrypt.co/106533/kim-kardashian-ethereum-max-dismis...
However, the fact it isn't regulated doesn't mean they can't be sued in civil court for running a scam. This is what they are really afraid of --- see Kim Kardashian for an example.
This is why crypto bros tend to hide their identify (Satoshi) or re-locate outside the USA and go into hiding once the scam collapses (the guys from 3AC).
BOTTOM LINE: Selling electrons as money from your momma's basement is a shady business in more ways than one. Participate at your own risk.
Crypto is backed by nothing. Nothing.
Fiat currencies are not “backed”, you have nothing they are even theoretically guaranteed to be exchangeable for, at a fixed rate of currency to commodity, setting a value floor, at least relative to the commodity.
They are, instead, actively managed.
The theory is that this is better, at least for large, geopolitically and economically powerful, countries as issuers, because backing commodities themselves are only at best a limited fit for the (even as a value basis) desirable features of currency, and have somewhat random performance at any given time compared to that “at best”, and active management (which is also not perfect!) seems to be able to do better, if the manager governs a big and powerful enough market to start with.
I'm just talking about regular everyday stuff. The US dollar has been exceedingly strong for a long time, due to many factors, none of which is that it is "backed" by gold or baby diapers or star trek transporters machines or orange juice.
This is just a colloquial conversation. If you want to be exacting, I can write 200 pages on it, complete with sources. But are you going to want to read it? or would I be wasting my time writing a long and thorough explanation? Wouldn't a couple of paragraphs suffice and just not have people nitpick in order to score "gotcha" points?
America, it’s workers, corporations, military, etc., will happily abandon the dollar should it become necessary. No one wants to be paid in money undergoing massive devaluation.
And to that point, it is true that nothing backs the dollar, but nothing backs nothing if you go down that road.
In past times, when, let's say a city was being attacked and there's a seige, and food runs out, people will sell their $500,000 diamond ring for a potato, so diamonds and gold have no value as compared to a potato.
However, if a meteor like the one that hit the earth 65 million years ago and wiped out the dinosaurs, hits again and wipes all of humanity out, there is no "back" of any currency anywhere.
I mean, if you're going to go down that road, let's take it to it's conclusion.
However, in the everyday world, the US dollar has a lot behind it. Like a huge military. No country is going to come in and take over the USA and throw out our money. Because we have a big military. There's a lot of trade going on with greenbacks. It is the world currency.
I'm not saying it is impossible for the dollar to go down the tubes, please don't assume I'm that stupid, nor anyone else is.
But there's a hell of a lot more reasons to stick with US dollars as a store of value, rather than bitcoin. Bit coin has got nothing, just a bunch of narcoterrorists and billionaires trying to smuggle out ill-gotten gains so they don't have to pay taxes. And the speculators working from the greater fool theory.
Fidelis in Numeris
It's "fractional reserve banking" --- only worse --- minus any accountability or guarantee of solvency.
Crypto solves all the problems of the Federal Reserve and banking --- simply by mimicing it for fun and profit. If you buy that, I've got some crypto to sell you.
A very great deal of imaginary money, that had never been exchanged for more dollars than were spent mining it, evaporated.
So, the winners were those who got actual dollars while the con ran. The losers were whoever handed over dollars.
Of course this phenomenon is not limited to crypto. Who here remembers Global Crossing? In the future, it will be Tesla.
But it is an actual business, bringing in actual money, and the money appears to be correctly accounted for.
I specifically remember reading that while he wants the business to succeed, he would consider it a success if he got all the other car companies to go electric and he went out of business. Not that he would want to go out of business.
I don't know how old you all are, but I remember when it first started, I thought it would go all John Delorean and be out of business in one or two years, and lo and behold all this time later. So I'm impressed. The guy is actually trying to do shit, as opposed to Jeff Bezos who all he is doing is attempting to ape Musk with the spaceship (what's happening with that now), and buying a $150 million Los Angeles mansion and making a massive yacht, and divorcing his beautiful wife and going out with that clown-faced nasty looking woman. $200 billion and she's the best he could do???
Bill Gates with his billions is just jerking off too. What's he doing?
Soon electric cars will not be a novelty, and Tesla's poor build quality, poor reliability, and poor repairability will start to be remarked upon.
We are years away from that happening. And someone is going to have to start producing a lot more batteries before it happens.
"Tesla's poor build quality, poor reliability, and poor repairability will start to be remarked upon."
Where numbers are you referencing here. Just because a few loud people on the internet complain about these things doesnt mean it endemic. Is it not more likely that most Tesla customers are extremely satisfied with their purchase and just dont post about it online?
Every professional car reviewer remarks on their poor "fit and finish".
The number of people complaining that Tesla quoted them repair estimates for relatively minor failures exceeding the resale value of the car is disturbingly large.
We are now in the position of Wile E Coyote having run off the cliff, but not yet looked down.
This exact same reasoning applies to drug dealers (illicit and BigPharma), sex dens, and other perverse corruptions (both sanctioned and not). I think the reasons you list as Tesla's faults are reason enough to look elsewhere (for a car or stock investment).
But, if your reasons are not enough, consider E.Musk's primary stated reason for running Tesla: to generate profits enough to get humanity to Mars. The task of doing so may very well deplete significant Earth resources... does it make sense to [further] pollute our space marble just to infect another space rock with us?
If you thought you were buying coke and got flour, that would be a con, but if not it's just illegal.
I'm not saying buy the stock, but that doesn't make it a con any more than any other thing I wouldn't buy.
Going to mars also isn't a con. It's just a reason (for you) not to buy the stock and or the cars.
Even O'Neill Can Donuts make more sense.
For example, many are calling star citizen a cons/scam. But IMO the intention to scam people just isn't there.
So, no, I wouldn't say tesla is a con.
While market cap is a popular number, it isn't meaningful wrt "total value" because the marginal price has no useful relationship to the average price.
To be a bit rhetorically excessive, you didn't exist before your birth so why would it be a problem for you to stop existing now?
Been in crypto since 2012. You're not wrong.