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by imtringued
1949 days ago
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> By that definition literally all investments are ponzis. You buy something hoping that someone else will be willing to buy it from you at a higher price. Oops the cryptocurrency bubble popped. Oops the company went bankrupt and your stocks are worthless. Stocks aren't ponzis. Companies pay out dividends all the time and sometimes (very rare nowadays) they pay for stock buybacks out of their own pockets from the profit they have accumulated. There is no need for a greater fool because the investment itself is paying out to investors. >Realize that there is always a bubble and take advantage of the bubble while it lasts. That's how you get bubbles. People see a chart with unsustainable 300%+ gains and think, if I were to act rationally and sell now, I would lose out on future irrational gains when the bubble goes up to 600%. If you thought. Hey, I see a bubble with X gains, if I take Y < X gains then I will get very safe money. Say 10% gains on 300% actual gains on Bitcoin. It would be very safe money and it would be rational and you weakened the bubble, but you also just lost out on big gains, so you stop doing the rational thing. |
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Not, all stocks do that though. I just checked the FAANG stocks and only Apple pays dividends. Even so Apple has a yield of 0.63% That means you have to hold it for almost 159 years to recoup that investment. Meanwhile if you bought a year ago, by now the stock price has doubled which can allow you to recoup your investment because you can sell it to the "greater fool." Eventually dividends go down, the company goes bankrupt, or some other thing happens and you don't want to be the fool holding the bag.
In cryptocurrency there also exists yield farming and buy backs.
>That's how you get bubbles.
There will always be bubbles. It's like a video game. You need to be minmaxing. Find what bubbles currently exist and figure out how to profit off of them.