Why all the gloom and doom about Steem prices?
My uneducated opinions about economics and finance can be explained by my belief of a paradox that our desire to make decisions using logic is constantly battling our need to make decisions based on emotions.
Maybe there is a deep rooted behaviour wired in our brain somewhere that an evolutionary biologist or clinical psychologist can explain for me, but I would argue that most of our behaviours seem to hinge on conflicting thoughts and actions resolving themselves.
There has been some recent talk about the price of Steem and what SMTs mean for the future of our community, but I have avoided the discussion because according to Warren Buffet's stock investment principles (which I am applying to other types of commodities and financial instruments), you should invest in stocks/things:
- That you can understand,
- Have favorable long-term prospects,
- Are operated by honest and competent people, and
- Available at a very attractive price.
I barely understand how the blockchain technology works, let alone cryptocurrency... this going to sound pretentious to some people because I keep telling others about how decentralization of certain aspects of society is going to change things (not necessarily for the better). Perhaps it is just another cycle and maybe when the dust settles on cryptocurrency we will think that a single trusted authority is better to deal with in the end (until they abuse that trust again). I can read the SMT whitepaper over and over but still not understand how it will help the people who contribute real value to Steemit get their fair share of the profits. So I am investing in the people who contribute to the platform and not the platform itself.
Did bitcoin have a favorable long term prospect? I guess that depends on how you define 'long term'. Does Steem have favorable long term prospects? I don't know but I do know that the people I interact with on Steemit and Discord still need to make a living regardless of the price of cryptocurrency. So I am investing in the community (i.e. their knowledge and skills) rather than the cryptocurrency itself (disclaimer: I do own some cryptocurrencies, but I think that's what the financial advisors would term as 'diversifying my assets').
Is Steemit Inc operated by honest and competent people? I am not going to touch that one, but I do know many honest and competent people on Steemit and I will continue to invest my time and energy in developing meaningful relationships with them.
Is Steem at an attractive price now? Well it depends on whether you have already bought some and when that purchase occurred. Maybe if I managed to figure out some fancy algorithm to calculate the arbitrage when cryptocurrency, fiat currency and commodities can be traded profitably I will tell you the secret and make dlive videos about it :D