Category: Money

Understanding cryptocurrency

The key concept: decentralized applications. Brilliant work of explication here. The talk of decentralized applications makes me think of a loosely confederated yet cohesively regulated group of independent soccer clubs. Wonder if this could also break the corrosive grip of the transfer market.

Let me start by stating that I believe:

  • The market for cryptocurrencies is overheated and irrationally exuberant
  • There are a lot of poseurs creating them, and some scammers, too
  • There are a lot of conflicts of interest, self-serving hype, and obfuscation
  • Very few people in the media understand what’s going on
  • Very few people in finance understand what’s going on
  • Very few people in technology understand what’s going on
  • Very few people in academia or government understand what’s going on
  • Very few people buying cryptocurrencies understand what’s going on
  • It’s very possible I don’t understand what’s going on


Source: A Letter to Jamie Dimon – Chain

Money advice

The Journal’s Jason Zweig has a new column I plan to study carefully.

Over the ten years through March, private-equity funds returned an average of 9.9% annually, net of all fees, according to the American Investment Council, a trade group for the industry. That’s well above the 7.5% return on U.S. stocks, including dividends.

Skeptics have long argued that you could come close to the performance of private-equity funds by using borrowed money to buy an index fund that invests in stocks that are cheaper and smaller than average.

Source: Private Equity for Cheapskates Like You – MoneyBeat – WSJ