Summer Musings and Inconvenient Market Facts


Summer is officially here. Yup, June 21 marks the summer solstice when vacations happen and work thinking slows. Lets refer to it as “drifting minds syndrome” season. That’s when current “hot” media topics conjure up thoughts of past events that make you think “hey, didn’t these current events happen before?” Well, in most cases, yes they did and some very inconvenient facts emerge. Forgotten, or ignored, facts. So with bluntness, and some sarcasm, let’s revisit some past ignored events.

The “hot” topics currently include inflation, rising interest rates, financial bear markets and…………cryptocurrency chaos. Really? Here are some inconvenient facts.

  • The 1970’s: Inflation, Russia invades Afghanistan, gas shortages, U.S. drops gold standard and financial markets are in bear markets. Sound familiar? It should.
  • Here’s where things get “fun.” Just like crypto today, in 1979 the “must read” magazine Business Week came out to declare “THE DEATH OF EQUITIES” on its front cover. Yup, after huge declines, equities were dead. (lol)
  • For “gold bugs” out there: Again like bitcoin today, in January 1980 gold hit $850 then dropped 40% in a month. By 1982 gold had lost 65% of its value. Never heard calls saying that gold was going to zero or too volatile for investors.
  • Again, comparing bitcoin and cryptocurrencies to other early investments, ever hear of Apple? Of course you have. In September 2000 AAPL stock lost 50% in one month. OMG! And from December 2007 to February 2008 (2 months) AAPL lost 45%.
  • So AAPL is just one. Don’t forget Tesla, Netflix, Microsoft, etc etc. Bitcoin and other digital assets are just the new “whipping boy/girl.” Every new growing financial sector experiences growing pains.

Moving along from those aforementioned inconvenient facts that many choose to ignore or “play down” (some bias maybe?) here are a couple of my own “drifting minds syndrome” thoughts which probably are politically incorrect (forewarned).

  • Why are bitcoin and other cryptocurrencies so hated by central banks (governments) and regulators? Because they can’t control it? Governments need the power to control your money.
  • Why can’t anyone define the intrinsic value of gold? Multiple sources say bitcoin has no intrinsic value but what is gold’s intrinsic value? Really. Only “it’s been around for thousands of years” which is a non-answer.
  • Will SEC oversight and regulation actually protect cryptocurrency investors? Remember Bernie Madoff? Ponzi scheme? Oh yeah, that guy. SEC auditors actually missed trades (fictitious of course) recorded on days markets were closed. Billions of investor money lost. Tsk tsk.

So, the more things change, the more they stay the same. Welcome to the summer doldrums and always remember no matter where you go, there you are. Musings complete.