Thursday, December 16, 2021

#350 / Fortune Favors The Brave?

 

A full-page advertisement in the November 17, 2021, edition of The Wall Street Journal looked a lot like the image above. With two slight differences! First, The Wall Street Journal advertisement used the American, not the British, spelling of "favors." Second, the "crypto.com" reference appeared at the bottom of the advertisement, not right near the top. 
 
Any Wall Street Journal reader who saw the advertisement had to wait for the association of the proverb with "crypto.com," the website reference for a company that has adopted the proverb as its motto and as the heart of its marketing strategy. The graphics/marketing strategy advanced by the advertisement is clear. The reader is meant to be inspired by the proverbial saying, and then, and only then, having fully absorbed the admonition that "fortune favors the brave," is let into the secret: brave people are investing in cryptocurrencies and are making fortunes by doing so!

For anyone who might have been beguiled by this advertisement, or who might otherwise contemplate the investment of one's life savings in some kind of cryptocurrency, allow me to offer a cautionary response. Instead of acting upon a self-interested and ill-advised suggestion from crypto dealers that investors who place their money in cryptocurrency will be "favored," take your investment advice from people who have actually made lots of money by investing. Some investors in cryptocurrencies may have been lucky, but if you actually want to realize a gain on your investment, I would  rely more on advice from Warren Buffett (whose investment strategy is described, right here, by Bill Gates) than on the advice you'll find on crypto.com. 

Cryptocurrencies have no "inherent" value, and their value is not guaranteed by any government (or other entity) that can be held accountable by those who place their money into cryptocurrency. The "value" of cryptocurrencies will go up as long as people keep paying more for them today than they did yesterday. When people stop doing that, there is nothing really "there." Cryptocurrencies are a high-tech version of one of Bernie Madoff's investment offerings. 

I have mentioned the following book more than once before (here's a link to one example) but let me do so again. My father gave me a copy of this book when I was still in high school - and I feel "fortunate" that he did so. As far as I am, concerned, Mackay's book ought to be required reading for anyone who thinks that it is "brave" to invest one's hard-earned assets in the latest speculative offering: 
 

Image Credits:
(1) - https://blog.crypto.com/crypto-com-oct-2021-updates/ 
(2) - https://www.abebooks.com/Extraordinary-Popular-Delusions-Madness-Crowds-Mackay/31016505481/bd 
 

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