BITCOIN?

If you are interested in finances at all, or by now just read the news, you have to be aware that BITCOIN has had an amazing run up.

The reason for this is simply demand since it has no intrinsic value at all.

I looked at BITCOIN a few years ago, decided that trying to mine it was beyond my computers capabilities and thought it was already overvalued.

Of course since then and especially in the last year or so, it has exploded in value so I guess I was wrong.

However, looking at it now I would draw the exact same conclusion, its overvalued because the only value it has is how much someone else is willing to pay for it.

Now that in itself isn't unusual, pretty much everything is valued that way.  The problem with BITCOIN is that it is either a fad (bubble) or is isn't.

It looks, smells and acts like a bubble, so its hard to believe it isn't.

Bubbles, like Ponzi schemes reward early investors but ultimately harms the majority of investors.

Was I wrong back when I thought it was overvalued (think it was under a $1,000) a few years ago?

Well the market says I was, but I'm not sure I was.

Am I wrong now to think its overvalued when its selling over $15,000?

I might be, but there is still nothing about it that tells me it has any real value at all.

Of course the more it goes up, the more it will tempt people to buy it, until at some point it stops.

Bubbles pop and when they do they deflate very quickly.

Also very painfully.