As Bitcoin reaches the $11,000 mark after an incredible growth over the past year, index fund revolutionary and legendary investor Jack Bogle has given his input on the cryptocurrency.
The founder of Vanguard replied to an audience question with ‘’Avoid Bitcoin like the plague’’ before going on to say ‘’Bitcoin has no underlying rate of return, you know bonds have an interest coupon, stocks have earnings and dividends, gold has nothing. There is nothing to support bitcoin except the hope that you will sell it to someone for more than you paid for it’’
Jamie Dimon, CEO of JPMorgan Chase, is also sceptical of Bitcoin and claimed that it is a ‘‘fraud’’ and is ‘’worse than tulip bulbs’’. In addition to this, Billionaire investor Howard marks called it a ‘’pyramid scheme.’’
Despite the negativity from some big names, people such as Fundstrat’s Tom Lee and value investor Bill Miller are embracing the cryptocurrency, with Miller running a fund which has nearly a third of its assets in Bitcoin.
The middle ground consists of people who believe it’s not the best investment, but not the worst either.
Mark Cuban, who seems to be among this group, has said that ‘’its OK to invest up to 10 percent of your savings in high risk investments, including Bitcoin. You just have to Pretend you’ve already lost your money’’ he then went on to say ‘’it’s like throwing the Hail Mary.’’
Although Bogle advises steering well clear of the digital currency completely and says ‘’ Bitcoin may well go to $20,000 but that won’t prove I’m wrong. When it gets back to $100, we’ll talk.”
Jack Bogle Image Source: businessinsider.com