Has Dave Ramsey Changed His Mind About Bitcoin?

Summary

The speaker discusses their personal philosophy on avoiding repetitive mistakes and evolving their approach to life. They address Jason's question about treating Bitcoin like single stocks, highlighting the differences between the two. The speaker argues that Bitcoin, despite its high market cap, is not a solid investment like stocks because it's based on speculation and lacks the performance and revenue track record of companies. They compare Bitcoin to commodities like gold and currencies, emphasizing that value is derived from people's agreement and faith. The speaker remains skeptical about Bitcoin's stability and its future as an investment, preferring traditional currencies and distrusting digital exchanges like PayPal for financial transactions.

Takeaways

• 🧠 Personal growth involves evolving from one level of 'stupid' to a higher one, learning from past mistakes.
• 🎧 The host shares a personal rule of not repeating the same mistakes and strives for continuous improvement.
• 💰 Bitcoin, despite its significant market cap, is not considered by the host as a solid investment like single stocks.
• 🚫 Warren Buffett's perspective on Bitcoin is cited, emphasizing its lack of intrinsic value compared to traditional investments.
• 📈 The host questions the concept of market cap in the context of Bitcoin and its volatility.
• 🤔 The source of value for commodities and currencies is discussed, highlighting the importance of collective agreement and faith.
• 🔄 Gold's value fluctuates based on public perception, which the host uses as a parallel to Bitcoin's current status.
• ⛔ The host is skeptical of Bitcoin as an investment, preferring traditional currencies and stocks based on performance and revenue.
• 🏦 The host expresses distrust in PayPal as an exchange and by extension, Bitcoin, due to its volatility and novelty.
• 💡 The idea of understanding blockchain technology is presented as a potential game-changer for the host's views on Bitcoin.
• 👴 A generational divide is suggested, with younger individuals potentially having a better grasp of new technologies like blockchain.

Q & A

What is the speaker's personal rule regarding mistakes?

The speaker's personal rule is not to do the same stupid stuff over and over but to evolve from those experiences.

How does the speaker compare their evolution of mistakes?

The speaker jokes about evolving to a higher level of stupidity, indicating they learn from past mistakes but acknowledge that the potential for error is always present.

What is Jason from Connecticut's question about in the script?

Jason's question is about treating Bitcoin the same way as single stocks and whether it's reasonable to invest in it.

What is the speaker's stance on Bitcoin as an investment?

The speaker is not in favor of investing in Bitcoin, comparing it to 'thin air' and agreeing with Warren Buffett's skepticism towards the cryptocurrency.

Why does the speaker not recommend investing even 5% in Bitcoin?

The speaker believes investing in Bitcoin is based on smoke and mirrors, indicating it's not a solid investment despite its market cap.

How does the speaker differentiate between stocks and Bitcoin?

The speaker views stocks as based on company performance and revenue, while Bitcoin is seen as speculative and not equivalent to investing in a company.

According to the speaker, what gives gold and currencies their value?

The speaker suggests that gold and currencies derive their value from the collective agreement and conflict among people, not from intrinsic value.

Why is the speaker skeptical about Bitcoin's current status as an investment?

The speaker argues that Bitcoin lacks a long track record of trust and stability, making it too volatile and speculative for investment.

What analogy does the speaker use to describe investing in volatile or untrusted currencies?

The speaker compares investing in Bitcoin to avoiding investments in Iraqi dinar and Confederate dollars, emphasizing the importance of faith and trust in the value of a currency.

How does the speaker view the argument that lack of understanding of blockchain technology is the reason for not investing in Bitcoin?

The speaker rejects the notion that skepticism towards Bitcoin stems from a lack of understanding of blockchain technology, arguing that experience and wisdom in investments should not be discounted.

Outlines

00:00

🤔 Bitcoin as an Investment vs. Stocks

The speaker discusses the nature of Bitcoin and contrasts it with single stocks. They mention their personal rule of not repeating the same mistakes and highlight the volatility of Bitcoin. The conversation includes references to Warren Buffett's skepticism towards Bitcoin, the speculative nature of cryptocurrencies, and the importance of public faith in the value of currencies. The speaker also compares Bitcoin to other commodities like gold and emphasizes the difference between stocks, which are based on a company's performance, and Bitcoin, which they view as a currency rather than an investment.

05:01

📱 Understanding New Technology: Blockchain

The speaker addresses the generational gap in understanding new technologies, specifically blockchain, which is often associated with Bitcoin. They reflect on their own experiences with past investment cycles and suggest that younger generations might be more inclined to embrace blockchain technology due to their familiarity with digital platforms. The speaker also promotes the every dooll app as a simple budgeting tool, contrasting it with the complexity of understanding and investing in cryptocurrencies.

Keywords

💡Bitcoin

Bitcoin is a decentralized digital currency, without a central bank or single administrator, that can be sent from user to user on the peer-to-peer bitcoin network without the need for intermediaries. In the video, the speaker discusses Bitcoin's volatility and compares it to traditional currencies and commodities like gold, questioning its value and stability in comparison to these established assets.

💡Market Cap

Market capitalization (market cap) is the total value of all outstanding shares of a publicly-owned company's stock. In the context of the video, the speaker refers to Bitcoin's market cap of 1 trillion dollars, questioning the validity of this valuation and comparing it to the concept of value associated with commodities and currencies.

💡Investment

An investment is the commitment of money or capital to a particular venture with the expectation of achieving a profit. In the video, the concept of investment is discussed in relation to Bitcoin, with the speaker expressing skepticism about treating Bitcoin like a single stock and questioning its place in an investment portfolio.

💡Blockchain Technology

Blockchain technology is a decentralized and distributed ledger system that allows multiple parties to have a shared perspective of the truth. It is the underlying technology behind cryptocurrencies like Bitcoin. The video suggests that understanding blockchain technology could change one's perspective on the value and potential of Bitcoin.

💡Volatility

Volatility refers to the rate at which the price of a financial instrument changes over time, typically associated with a high degree of variation. In the video, the speaker discusses the volatility of Bitcoin, comparing it to the ups and downs of gold prices and suggesting that Bitcoin's price fluctuations are a sign of its uncertain value and speculative nature.

💡Stocks

Stocks, or shares, represent ownership interests in a corporation and are financial instruments that trade on stock exchanges. In the video, the speaker differentiates stocks from Bitcoin, emphasizing that stocks are based on a company's performance and revenue creation, which provides a more tangible basis for investment compared to the speculative nature of Bitcoin.

💡Commodities

Commodities are raw materials or primary products that are bought and sold on national and international commodity markets. In the video, the speaker compares Bitcoin to commodities like gold, suggesting that the value of such assets is derived from the agreement and demand of people, rather than intrinsic value.

💡Currency

Currency refers to a system of money as agreed upon by a community of users for the purpose of trade and commerce. In the video, the speaker asserts that Bitcoin is a currency, not an investment, and discusses the concept of value in relation to currencies, emphasizing that value is based on the faith and agreement of people.

💡Value

Value refers to the importance, worth, or usefulness of something, often in an economic context as the perceived worth of an asset or commodity. The video discusses the concept of value in relation to Bitcoin, stocks, and commodities, questioning what gives them value and how that value is established.

💡Speculation

Speculation is the act of investing in something with the hope for profit based on the expectation of future price changes, rather than on the basis of underlying assets or performance. In the video, the speaker criticizes Bitcoin as a speculative investment, contrasting it with more traditional and performance-based investments like single stocks.

💡Faith

In the context of the video, faith refers to the trust and belief that people place in the value and stability of a currency or asset. The speaker argues that Bitcoin has the least faith among currencies because it is a relatively new and unproven asset, with its value primarily based on speculation and agreement.

Highlights

The discussion revolves around the comparison of Bitcoin to single stocks and its legitimacy as an investment.

Bitcoin is considered by some as an asset with a $1 trillion market cap, but the speaker argues that it's still 'thin air'.

Warren Buffett's perspective on Bitcoin is cited, emphasizing that it has no inherent value.

The speaker suggests that while Bitcoin could be a part of a portfolio, it's not a necessity.

The concept of market cap and its relevance to Bitcoin's value is questioned.

Bitcoin's volatility is mentioned, with the speaker noting its rapid rise and fall in value.

A comparison is made between Bitcoin and gold, highlighting their shared characteristics as commodities.

The value of commodities and currencies is discussed, emphasizing the importance of collective agreement on their worth.

The speaker expresses skepticism about Bitcoin's future, likening it to other failed currencies.

The distinction between Bitcoin as a currency and stocks as representations of company performance is clarified.

The speaker admits to not understanding Bitcoin deeply, but argues that this doesn't mean a lack of investment wisdom.

The idea that understanding blockchain technology could change one's perspective on Bitcoin is presented.

The speaker reflects on past investment cycles and suggests that the current interest in Bitcoin may be part of a cycle.

A challenge is posed to the younger generation, questioning whether their familiarity with technology equates to investment wisdom.

The advertisement for the 'every dooll' app is mentioned, promoting budgeting as a practical tool for life.

Transcripts

[Music]

brought to you by the every dooll app

start budgeting for free today I do a

lot of stupid stuff but my personal rule

is not to do the same stupid stuff over

and over you evolved I I try to well

I've evolved my it's a higher level of

stupid there we because the past level

of stupid has been learned has been

grown upon it's always right below the

surface you got to watch PhD and dbb I

have graduated wow there you go delone

had has two of those I heard well he's

not not in that he's got real ones but

um there you go good kind today's

question comes from Jason in Connecticut

uh who's also not evolved uh can we

start treating Bitcoin the same way you

would treat single stocks crud son uh I

understand you're not a fan no kidding

where'd you figure that out but an asset

with1 trillion doll market cap is not a

beanie baby uh no but it's still thin

air ask uh people like Warren

Buffett who says if he doubled the

amount he had put in Bitcoin he would

still have zero cuz that's am he's put

in Bitcoin I'm going with Warren on this

one not saying you have to add it to

your portfolio but it's a good enough

asset to invest 5% no it's not okay I

don't know where the 5% comes from I

don't know where the trillion dollar

market cap comes from M and smoking

mirrors like the whole concept while you

were enjoying some time off Bitcoin has

shot from you know the ground to the

moon and probably back up again and so

now everyone's getting they're getting

loud again no way because it's hit

alltime highs and so now everyone's

going see Dave is wrong about this you

know what we've got something else that

repeats itself like gold see I've been

doing this show for 32 years and ever so

often gold goes up and everybody goes

see Dave I told you and then it goes

down and those people just disappear and

then it goes up and they go see Dave I

told you you don't understand gold you

don't really understand gold has value

like what why does it have value because

of people like you it's a commodity

that's where people get that's where

people get value the only reason gold

has value is two people agreed that had

value and they fought over it that's the

only reason the that's the same reason

that green paper has value two people

agreed it had value and they fought over

it that's what gives something value so

Commodities are exactly the same way as

currencies and uh Bitcoin someday all

kidding aside all sarcasm aside someday

it may level out and become a thing but

um Jason it's not there it's not there I

wouldn't wish a Bitcoin investment on

somebody I really dislike

that's saying something I really

wouldn't I mean I don't want I don't

even want those people to lose money

well even then I see single stocks very

differently because stocks are based on

a company's performance and revenue

being created well that's because you're

intelligent I didn't I didn't have to

think that deeply to get there and so

again I'm not mad at Bitcoin but to say

Bitcoin is the same as a single stock is

just not true no Bitcoin is a currency

it's speculation based ones currencies

have no value except for their track

record that indicates that two people

are willing to fight over them that's

why the yin versus the dollar the pound

versus the dollar the deutschmark versus

the Yen these things compared back and

forth It's the faith that people have in

something and of all the

currencies

um Bitcoin has the least Faith it's the

most I've heard a lyric once you got to

have faith

Dave I wasn't going to go there oh oh

yeah there's it I mean you just it's not

um yeah so it's going to continue to be

volatile until it's not and even then uh

I don't invest in the Iraqi dinar

because it had Saddam Hussein's face on

it and no one long no one has faith in

that currency anymore I don't invest in

Confederate dollars from the Civil War

because no one any longer has faith that

they have value except as a collectible

I know I do not invest in things where

people have not established a longrack

record of faith and even then on a

currency I don't invest in a currency I

would utilize it I would utilize it so

to the point that I don't trust PayPal

to be an exchange that's a trust

mechanism I don't use PayPal for an

exchange so I don't even use Bitcoin for

an exchange because it's too freaking

out there for that even but it's a

currency honey it's not an investment to

George's Point well d you just don't

understand the blockchain technology and

once you get it you'll change your mind

uh that's the line I hear all the time

yeah this guy doesn't understand the

blockchain it's the future maybe it is

you know when you say stuff like that it

indicates you don't understand

Investments cuz I've seen four Cycles in

my adult life of the nothing down real

estate come and go four cycles of it

we're in the fourth right now on Tik Tok

and a little bit on Instagram

but I've seen four of them some of you

aren't old enough to have seen one of

them and so you're going to fall

headlong into it like I did the first

time and bloody your freaking nose so

you can decide do old people have wisdom

from their

experience or are they out of touch and

they don't understand blockchain

technology you don't understand because

you didn't grow up with an iPhone in

your hand you didn't use it as a

pacifier so you don't know how the world

Works see you can decide that if you

want or you can decide to actually we

can learn something create your free

every dooll budget today the simplest

way to budget for your life