The Market Thread

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jobob85

Drunkle
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Mar 11, 2009
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I heard a funny story about crypto "I went to Harvard MBA and worked 20 years on wallstreet, my net worth is $15 million. My stoner cousin that lived in his parents basement all his life bought crypto last year and is worth $2 billion."

It feels like the tech wreck of 1999/2000.
 
Jun 4, 2014
1,187
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Dallas, TX
I heard a funny story about crypto "I went to Harvard MBA and worked 20 years on wallstreet, my net worth is $15 million. My stoner cousin that lived in his parents basement all his life bought crypto last year and is worth $2 billion."

It feels like the tech wreck of 1999/2000.
While a reasonable comparison, there’s a good contrary mantra to keep in mind. “Don’t fight this war, using the last war’s tactics.”
 

jobob85

Drunkle
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While a reasonable comparison, there’s a good contrary mantra to keep in mind. “Don’t fight this war, using the last war’s tactics.”
While I'll never get involved in a land war in Asia, I will always stick to:

Not investing in business models I don't understand.
Never assuming more risk than I am comfortable with.
 
Jun 4, 2014
1,187
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While I'll never get involved in a land war in Asia, I will always stick to:

Not investing in business models I don't understand.
Never assuming more risk than I am comfortable with.
Couldn’t agree more. That’s one of the frustrating things about crypto. Lots of memes that literally serve no purpose (e.g. DOGEcoin). They bring down the viability of the asset space to many folks. And then there are some that actually have a good white paper and development plan. Which is what I was trying to explain earlier when I replied to steross. Just too many to actually explain on a message board lol.
 
Aug 10, 2012
261
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Norse Mythology
I'll wade into the crypto discussion as it's widely misunderstood in my opinion. If you don't have a portfolio allocation to crypto currently then I'd suggest a deep dive with an open mind. None of the specific coins mentioned below should be construed as investment advice or any sort of endorsement, but rather illustrations for the purpose of making a point.

I classify crypto in basically 4 categories:
1) Bitcoin: Bitcoin is decentralized, permissionless, and a store of value. Bitcoin has little value as a currency of exchange (it's expensive and energy intensive to transact with for everyday things). It has extreme value though as a hedge against monetary inflation. Most important, bitcoin is gaining broad acceptance as a store of value and it trades at a fraction of gold's value. Gold's market cap is roughly $10T. Bitcoin is $1T. There's little doubt in my mind that bitcoin's market cap won't be 10% of gold's in a few decades and indeed be much closer to parity. It's much easier to spend bitcoin, transport bitcoin, buy bitcoin, sell bitcoin, donate bitcoin, etc than gold. So view bitcoin as you'd view gold. The market cap erosion of gold is material consideration for owning at least some bitcoin.
2) Ether/Defi (Decentralized Finance): Not going to comment on specific Defi coins (I own a smattering of coins that I think might win Defi), but it's important to realize that Defi will completely disrupt traditional finance. In it's simplest terms, Defi is a way of removing financial intermediaries from transactions by utilizing the blockchain. Most Defi is Ethereum based fyi so in my opinion the best play at this time is owning Ether. That actually pains me because I hate Ether for various reasons, but it's the most trusted and broadest Defi blockchain right now so it warrants exposure. Ether is also huge in the NFT market (more on NFT's later) so it's another compelling reason to own Ether.
3) Technology coins: There are coins that are going to completely change the way we interact with the world on an everyday basis. They are technology plays and have nothing in common with Bitcoin. Take Solana for example. Solana can process 65,000 transactions per second. This is all done at fractions of a penny per transaction. Imagine the utility that presents to a Visa or a Paypal or a Walmart? Then there's Polkadot which aims at integrating blockchain to blockchain "communication". There's many coins that fit under this category. So why a coin? It's a way to raise capital and a way to decentralize validation of the Blockchain. I view coins under this umbrella more similarly to small cap tech stocks than I do "Crypto".
4) Memecoins: Doge, Shiba, etc. There's a lot of them. I personally don't buy them because they fall outside my risk tolerance and seem more like gambling than investing. Side note: Someone mentioned Shiba previously and the biggest reason Shiba went bonkers IMO is because Vitalik (Ether creator) bought and "burned" (destroyed) 41% of the Shiba supply. This brought attention to it and limited the supply.

Finally, a moment for NFT's as it's all the rage right now. Don't sleep on NFT's as pixelated nonsense. It's a $10B-$20B market. It will grow exponentially the next few years. I've allocated capital to NFT's for the sole purpose that I believe as more and more NFT's flood the market, it will give older NFT's more and more value to collectors. No different than a Picasso. I take a dummy strategy of just buying a whole bunch of cheap ones and hoping a few go parabolic. Also, a secondary appeal of NFT's to people is that they get crypto exposure via holding NFT's because they are either denominated in Ether or Solana.
 

jobob85

Drunkle
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Mar 11, 2009
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I'll wade into the crypto discussion as it's widely misunderstood in my opinion. If you don't have a portfolio allocation to crypto currently then I'd suggest a deep dive with an open mind. None of the specific coins mentioned below should be construed as investment advice or any sort of endorsement, but rather illustrations for the purpose of making a point.

I classify crypto in basically 4 categories:
1) Bitcoin: Bitcoin is decentralized, permissionless, and a store of value. Bitcoin has little value as a currency of exchange (it's expensive and energy intensive to transact with for everyday things). It has extreme value though as a hedge against monetary inflation. Most important, bitcoin is gaining broad acceptance as a store of value and it trades at a fraction of gold's value. Gold's market cap is roughly $10T. Bitcoin is $1T. There's little doubt in my mind that bitcoin's market cap won't be 10% of gold's in a few decades and indeed be much closer to parity. It's much easier to spend bitcoin, transport bitcoin, buy bitcoin, sell bitcoin, donate bitcoin, etc than gold. So view bitcoin as you'd view gold. The market cap erosion of gold is material consideration for owning at least some bitcoin.
2) Ether/Defi (Decentralized Finance): Not going to comment on specific Defi coins (I own a smattering of coins that I think might win Defi), but it's important to realize that Defi will completely disrupt traditional finance. In it's simplest terms, Defi is a way of removing financial intermediaries from transactions by utilizing the blockchain. Most Defi is Ethereum based fyi so in my opinion the best play at this time is owning Ether. That actually pains me because I hate Ether for various reasons, but it's the most trusted and broadest Defi blockchain right now so it warrants exposure. Ether is also huge in the NFT market (more on NFT's later) so it's another compelling reason to own Ether.
3) Technology coins: There are coins that are going to completely change the way we interact with the world on an everyday basis. They are technology plays and have nothing in common with Bitcoin. Take Solana for example. Solana can process 65,000 transactions per second. This is all done at fractions of a penny per transaction. Imagine the utility that presents to a Visa or a Paypal or a Walmart? Then there's Polkadot which aims at integrating blockchain to blockchain "communication". There's many coins that fit under this category. So why a coin? It's a way to raise capital and a way to decentralize validation of the Blockchain. I view coins under this umbrella more similarly to small cap tech stocks than I do "Crypto".
4) Memecoins: Doge, Shiba, etc. There's a lot of them. I personally don't buy them because they fall outside my risk tolerance and seem more like gambling than investing. Side note: Someone mentioned Shiba previously and the biggest reason Shiba went bonkers IMO is because Vitalik (Ether creator) bought and "burned" (destroyed) 41% of the Shiba supply. This brought attention to it and limited the supply.

Finally, a moment for NFT's as it's all the rage right now. Don't sleep on NFT's as pixelated nonsense. It's a $10B-$20B market. It will grow exponentially the next few years. I've allocated capital to NFT's for the sole purpose that I believe as more and more NFT's flood the market, it will give older NFT's more and more value to collectors. No different than a Picasso. I take a dummy strategy of just buying a whole bunch of cheap ones and hoping a few go parabolic. Also, a secondary appeal of NFT's to people is that they get crypto exposure via holding NFT's because they are either denominated in Ether or Solana.
I will have to read this several times so my antiquated way of thinking has the potential to absorb most of it.
 
Nov 6, 2010
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So it seems pretty obvious the market is gonna crash tomorrow, and I can't wait to buy. Anybody have any ideas as to what the best bargains will be?
 

steross

he/him
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Mar 31, 2004
32,277
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oklahoma city
I'll wade into the crypto discussion as it's widely misunderstood in my opinion. If you don't have a portfolio allocation to crypto currently then I'd suggest a deep dive with an open mind. None of the specific coins mentioned below should be construed as investment advice or any sort of endorsement, but rather illustrations for the purpose of making a point.

I classify crypto in basically 4 categories:
1) Bitcoin: Bitcoin is decentralized, permissionless, and a store of value. Bitcoin has little value as a currency of exchange (it's expensive and energy intensive to transact with for everyday things). It has extreme value though as a hedge against monetary inflation. Most important, bitcoin is gaining broad acceptance as a store of value and it trades at a fraction of gold's value. Gold's market cap is roughly $10T. Bitcoin is $1T. There's little doubt in my mind that bitcoin's market cap won't be 10% of gold's in a few decades and indeed be much closer to parity. It's much easier to spend bitcoin, transport bitcoin, buy bitcoin, sell bitcoin, donate bitcoin, etc than gold. So view bitcoin as you'd view gold. The market cap erosion of gold is material consideration for owning at least some bitcoin.
2) Ether/Defi (Decentralized Finance): Not going to comment on specific Defi coins (I own a smattering of coins that I think might win Defi), but it's important to realize that Defi will completely disrupt traditional finance. In it's simplest terms, Defi is a way of removing financial intermediaries from transactions by utilizing the blockchain. Most Defi is Ethereum based fyi so in my opinion the best play at this time is owning Ether. That actually pains me because I hate Ether for various reasons, but it's the most trusted and broadest Defi blockchain right now so it warrants exposure. Ether is also huge in the NFT market (more on NFT's later) so it's another compelling reason to own Ether.
3) Technology coins: There are coins that are going to completely change the way we interact with the world on an everyday basis. They are technology plays and have nothing in common with Bitcoin. Take Solana for example. Solana can process 65,000 transactions per second. This is all done at fractions of a penny per transaction. Imagine the utility that presents to a Visa or a Paypal or a Walmart? Then there's Polkadot which aims at integrating blockchain to blockchain "communication". There's many coins that fit under this category. So why a coin? It's a way to raise capital and a way to decentralize validation of the Blockchain. I view coins under this umbrella more similarly to small cap tech stocks than I do "Crypto".
4) Memecoins: Doge, Shiba, etc. There's a lot of them. I personally don't buy them because they fall outside my risk tolerance and seem more like gambling than investing. Side note: Someone mentioned Shiba previously and the biggest reason Shiba went bonkers IMO is because Vitalik (Ether creator) bought and "burned" (destroyed) 41% of the Shiba supply. This brought attention to it and limited the supply.

Finally, a moment for NFT's as it's all the rage right now. Don't sleep on NFT's as pixelated nonsense. It's a $10B-$20B market. It will grow exponentially the next few years. I've allocated capital to NFT's for the sole purpose that I believe as more and more NFT's flood the market, it will give older NFT's more and more value to collectors. No different than a Picasso. I take a dummy strategy of just buying a whole bunch of cheap ones and hoping a few go parabolic. Also, a secondary appeal of NFT's to people is that they get crypto exposure via holding NFT's because they are either denominated in Ether or Solana.
Oh my.

Ghost of Christmas past.....

Welcome back stranger.
 

steross

he/him
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Mar 31, 2004
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Good to be back. Been a while....

There's not much that motivates me to come out of hiding. Except the market. And more specifically crypto.
I fully admit as an old guy I've barely looked at crypto except with after the fact longing as it is a space I don't understand. I did set up an account but never felt comfortable with the products or the exchange. My brokerage is now offering crypto so I guess it is time to have a better look.
 

Deere Poke

I'd rather be in the woods
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Feb 13, 2014
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Bixby-Bristow OK
I will have to read this several times so my antiquated way of thinking has the potential to absorb most of it.
Summary, one imaginary money created out of thin air is going up in value while another imaginary money created out of thin air is going down in value. Why not trade the imaginary money that's deflating for the imaginary money that's inflating.
 

jobob85

Drunkle
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Mar 11, 2009
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Summary, one imaginary money created out of thin air is going up in value while another imaginary money created out of thin air is going down in value. Why not trade the imaginary money that's deflating for the imaginary money that's inflating.
What I would like to do is find the new one that turns $1,000 into $100,000 in 12 months.
 
Aug 10, 2012
261
529
643
41
Norse Mythology
I fully admit as an old guy I've barely looked at crypto except with after the fact longing as it is a space I don't understand. I did set up an account but never felt comfortable with the products or the exchange. My brokerage is now offering crypto so I guess it is time to have a better look.
I have owned bitcoin for years. I shunned all other crypto due to a lack of understanding. I could easily wrap my head around bitcoin's blockchain (its general ledger), finite supply, de-centralization, ubiquity, etc. I couldn't say the same about other crypto at that time because there weren't really practical applications for Ether in its infancy. But it's changed and therefore I had to change my perspective and educate myself.

I've always been a stocks guy, but IMO the opportunities don't exist like they used to in the stock market unless it's a Great Recession or COVID event. I still have a huge allocation to index funds via retirement accounts, but the pivot to crypto for everything else felt right to me based on age, risk tolerance, etc. Obviously it may not be for everyone, but I firmly believe it's at least worth educating oneself. And FWIW, I have this talk with people daily and 90%+ of them think I'm crazy. So no offense taken if that's the conclusion. :lol:
 

bleedinorange

Federal Marshal
Jan 11, 2010
12,704
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Close, very close
I don't think you're crazy, but I don't think I am either by deciding to leave well enough alone. I like where I am and after 50yrs in the market this old dog doesn't need any new tricks. I do watch with interest these machinations.

I do predict this month the market will end up higher. December is historically strong. I'm holding. :)
 
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