There are two types of stock bubbles – normal stock bubbles of five years or so and shorter-term, more extreme bubbles – and we’re currently in the midst of both kinds.
Both are characterized by irrational behavior…
A complete break from any fundamentals.
On Thursday, I’ll talk more on Thursday about how this is the case with the stock bubble. But today, let’s compare the cryptocurrency bubble to five other quick-and-nasty bubbles that have wiped out investors in the past. I’m talking, of course, about the tulip bubble, the South Sea and Mississippi bubbles,the internet bubble, and the recent China bubble. All of them have something in common, and that’s really bad news for those latecomers to this Bitcoin bubble.
The thing with this crypto bubble – and all the bubbles, stock and short-term alike, that have come before it – is that it ultimately results in a shakeout. It destroys all the flotsam and jetsam lurking in the market in question. And it presents once-in-a-lifetime wealth-building opportunities.
Take Amazon (AMZN) for example. During the dot.com boom it went to $113 per share. Then the crash brought it tumbling down to just $5.50 a share – down 95%. It survived though, and today one share goes for more than $1,300. That’s a 240 times gain!
The same kinds of opportunities will present themselves once this crypto bubble has burst. We believe one cryptocurrency in particular is in a good place to survive the shakeout ahead. Think of it as the Amazon of the cryptocurrency world.
I have to disagree with this comparison. eBay would be the better comparison. Amazon needed 9 years before they broke 1999's high. if it's true that cryptocurrency is in bubble, and assuming it will crash this year, does it mean we have to wait 9 years just to break even? that'd be too long and believe me most people would lose faith already. 9 years is a very long time
Amazon is a beast! Great post! Followed, feel free to follow back!