On Crypto Currency

This episode invites listeners to relax as we gradually grow in our understanding of Crypto. Not to feel anxiety of missing out, or falling behind. Crypto is not the first financial instrument that takes time to grasp.

Transcript

Good morning. I’m Frank Kaufmann.

I’m speaking this morning with a couple of thoughts on cryptocurrency. 

If you’re like me, that terminology was once a distant and remote phenomenon that we never knew much about, and it has been encroaching on to our lives and consciousness with ever greater frequency. Now, if you own a phone, or participate in any social media at all, all of them are involving themselves in cryptocurrency. If you read the newspaper, you’ll find that banks and established investment firms like Goldman Sachs are involving themselves in cryptocurrency. 

This seems to be becoming ever closer to the financial universe in which we all participate, we then start to feel a certain degree of anxiety and to a certain degree the necessity to familiarize ourselves with this or to get in on the ground floor and be involved in explosive earnings opportunities. 

Along with a universe of things, basically unknown to ourselves, we get anxiety in trying to imagine that opportunities are passing us by or even worse than mere opportunities. Just the ability to function naturally in our day to day needs and commerce will be threatened by our inability to grasp crypto currency. Again, if you’re like me, there may be many of you who are familiar with the term, but don’t exactly know what it is. There are simple definitions, and maybe you’ve Googled them. Forbes says “cryptocurrency is a decentralized digital money based on blockchain technology. You may be familiar with the most popular versions, Bitcoin and Ethereum. But there are more than 5000 different crypto currencies in circulation.” 

There’s a lot about what I’ve said just now, which I believe is ironic, paradoxical or absurd by nature. Others of it are confusing or difficult. The absurd or paradoxical part is that it has the word crypto in it, which means secret. And yet, as we watch now, major banks, major investment firms and multi billionaire tech organizations are all deeply involved in cryptocurrency. You may have a popular reader or youtuber you like to watch. And they’ll have a little note “we accept cryptocurrency.” We may be feeling left out of this new development. 

The paradox that I wanted to point out is that crypto or secret can’t possibly mean that any longer if Goldman Sachs, Citibank and every other mega investment, global controlling entity is involved. It is no longer “crypto” if central banks and tech are heavily involved and if major if major columnists are accepting crypto for other supportive their work in their writing, if your phone or Apple phone invites you to download the app with “cryptocurrency Made Easy,” then that is not “crypto” by any stretch. Then when you try to learn about it, like the Saturday Night Live skit with Elon Musk, when they were asking what is Dogecoin? Musk answered four or five times. And the announcer on the show says “Well that’s great, but what IS Dogecoin?” This is very similar to the definition that I just read “decentralized digital money,” what is digital money. Immediately we may come across in the explanation a term that doesn’t even have traction in our lives. Digital money what is digital money, “based on blockchain technology,” what is blockchain technology? You may know what it is. I happen to know what both of those things are. But when looking it up and trying to get an answer you may be immediately confronted with explanations that are just as confusing as the original question. I’m not any smarter about knowing what cryptocurrency is, because the definition uses terms I never heard of or conceived or I can’t grasp exactly what’s meant by that. 

A lot of us and probably many of you listeners are familiar with it. But this is the dilemma that a lot of people are finding themselves in. Here’s an important thing to know. If you’re feeling left out, if you’re feeling that you’re not on top of this, if you’re feeling that you need to be able to communicate, made made to start investing and start saving and not suddenly find oneself where you can’t buy a dozen eggs, just remember, there are 5000 different cryptocurrencies in circulation. Also There’s a lot of controversy over cryptocurrencies, the environmental impact of mining, cryptocurrency is already a major concern. This is not a settled field in which we’re being left out. 

What I want to suggest to us is that most of us are not investors, a lot of us may have enough money to invest. But most of us are not. In the field of financial instruments. We are in other fields, we are in areas that are more important to us, we may be creatives, we may be artists, we may be social, socially conscious people, we may have professions that are involved in helping the welfare of our fellow citizens or families with difficulties or children with learning troubles. We may be in a helping field, we may be athletes or entertainers. The vast majority of human beings are not. Investors are not involved in finance, financial life, there’ve always been a very few people who are involved in that. And from what I can see in my life, I’m sure that in the field of financial investment, there must be a lot of okay people in it, I’m sure, I guess. But from what I’ve seen, the people who were involved in financial investment, they don’t really have the happiest lives so far as I can see. They strike me as out of balance, they strike me as maniacal, their wealth strikes me as going up and down. You don’t read about mass suicide among movie actors or mass suicide among baseball players, or something. But every so often, there’ll be something happening in the financial world, where suddenly people are taking their lives over financial developments. So this tiny number of people, as I say, there must be some, okay, people, there’s a lot of thieves and rapacious people, there’s a lot of people who make money at any cost. their personalities are just the worst one would ever want to meet. And so to feel the compulsion or urgency to somehow become an immediate expert, or that we’re missing out or not making enough or not, or not, or missing a wealth opportunity. The first question to ask is, are you doing all right? with your family? Do you have enough to eat? Can you pay your rent, then we’re kind of, Okay, enough, then we can relaxingly go look at possibly growing our wealth, in order to do the things which we think are important in our lives. 

So the final thing I just want to say is that an element or a dimension, or a fringe development in the world of finance, investment, and, and growth of net worth has always had a type of person way off on its fringes, who that’s their job, that’s their love. I pray and hope that these people’s lives are happy and healthy, that they come home and relax, and bounce their kids on their knee and, and sometimes sleep in and sometimes take a walk in the park. And you know, I hope that they do less kind of crazy drugs like methedrine and cocaine and all kinds of pump up the energy type of stuff. So I don’t know that field. But the development of cryptocurrency, I believe, is, for the most part meant for people who are in that arena of work, and then the rest of the world of money. We all participate in it naturally. But for many, many of us, it’s not the only thing we do. All throughout it. 

Many of us, most of us, maybe all of us have a portfolio of some sort, some investments of some sort. You get to know what your house is worth. You watch the housing market. Of course everybody’s involved in finances to the extent that it’s understandable and then there is a community that is that is, that is way, way out there, it’ll come to us, it’ll come to us in the time And to the degree that we have interest and availability. You won’t suddenly go to the store with a $1 bill and can’t get your eggs. By the time you can’t get your eggs. It will be integrated into the affairs of consumer life. It’s not something you’ll miss out on. People want you to spend your money and they don’t want you to not know what on earth it is. 

Here’s a few things that came and went. Maybe they haven’t even gone yet that you didn’t know about, and there were people jumping out of windows. Bespoke Tranche Opportunities. That’s a financial instrument. That’s a part of finances, just like cryptocurrency. Collateralized Debt Obligations, CBOs that later became known as Bespoke Tranche Opportunities. BTOs like PTOa are more tailored than traditional CBOs, and highly customized based on investor requirements. Okay, there’s another definition that I don’t know about on earth has just been described here. Credit Default Swaps. A lot of you may know about it. I’ve heard of it. I’ve heard it just like I’ve heard crypto currency, but don’t ask me to explain what a credit default swap is, I really don’t know Did you ever heard of something called Weather Derivatives? In July 1996, Weather Derivatives were part of a group of futures contracts, that trade on goods that have no intrinsic value. That is an actual financial instrument out of which wealth was pursued. Weather Derivatives, futures contracts, that trade on goods that have no intrinsic value, that’s their technical definition. And that is a financial instrument. The point is that although the Weather itself has no intrinsic value, it can adversely affect (a storm, for example), goods and services that do have an intrinsic value. And that becomes an investment thing. Here’s another one, Catastrophe Bonds. Catastrophe Bonds behave similarly to Weather Derivatives in that they offer financial protection. In the event of an offer, issued by an insurance company, these bonds help insurers ensure that they can actually pay out. This is a financial instrument. And here’s one of the best forms, Bowie Bonds, you may have heard the name, it’s named after David Bowie of all persons, the person who stretched being human and stretched morality, despite his talents, to to to outlandish degrees. And yet there’s a financial instrument named after him, this type of security are essentially bonds backed by the royalties from an artist’s catalog. I’m going to invest in those. So the only reason why I went through this list of genuine legitimate financial instruments that might have people yelling and screaming and tearing out their hair and throwing their hat on the ground and jumping on it on the Wall Street floor. These are real things. And like crypto and they probably affect us financially. 

So cryptocurrency will affect us financially. But I’m only speaking this morning just to invite us to relax a little bit to not worry a little bit to give it time. Now here’s a kid in his basement eating Cheetos and Doritos has 53 computers with more computing power than you will ever have if you live in 1000 lives, and he’s living and dying, one day worth a million dollars the next day worth $2. That’s not really the life that you need right now. Tell me which one of the 5000 cryptocurrencies you think is going to be your best investment right now. 

So my words this morning are just a simple invitation to be at peace and to live wholesome, balanced healthy lives, with the focus on the dreams and purposes and desires for your own self improvement and allow the financial dimension of it to come to us in the way and with the same balance with which we’ve always run our lives until now. 

Thanks a lot for listening