Bitcoin is now worth over $10,000 – Now let Warren Buffett explain to you how bubbles are formed

It’s a no-brainer. When it comes to value-investing, nothing beats Warren Buffett and his mentor Ben Graham (you might want to read the bible of value-investing by him called The Intelligent Investor). He has accumulated his wealth by closely following this mindset and ended up being the world’s richest man for a few years (he is a super interesting person and HBO has a very interesting documentary on him called “Becoming Warren Buffett”). Basically, value-investing is the opposite of whatever you see in the news and the mainstream media (yes, you can say he’s a contrarian – in a way – but that’s because he has a different perception for everything that happens to everyone on a daily basis). It’s like when you open any music channel and it plays Justin Bieber; eventually, you’ll start thinking that his stuff is cool (and worth a Grammy) since you have not bothered looking at other alternatives outside of the mainstream media. But if you search (i.e. study) enough, you’ll soon be questioning a lot of stuff!

Here’s a very nice article on him explaining how bubbles are created. I would really suggest that you spend a few minutes reading it.

Also, it is very much worth to note that Warren Buffett, who is also known as the Oracle of Omaha, is the CEO of Berkshire Hathaway, which the company that made him the richest person on earth for a few years (he is still number 4 at the time of writing this article). For everything to be a bit more clear:

  • Berkshire Hathaway shares (class b) have increased by around 275% since its lows back in 2009; that is an average of  30.5% for 9 years.
  • Bitcoin value is up by a staggering 1,335% from Nov 30, 2016 to Nov 30, 2017.

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