Category Archives: Economics

Cryptocurrency In Early 2018

After a spectacular rise  last December, all cryptocurrencies have since fallen dramatically.  Has the bubble finally burst for Bitcoins and alt-coins?  I don’t think so.

The current cryptocurrency market is very similar to the dotcom bubbles at the turn of the century.  In the early days of Internet, companies rushed to setup “.com” websites to capture mass enthusiasm from public into the promising e-commerce  technology.  As long as your company has a “.com” website and the appearance that you have a working shopping cart and some products to sell, investors would happily fort over their money into your business.

Needlessly to say, eventually the bubble burst and many dotcom businesses turned upside down and people lost money.   However, was e-commerce/dotcom a scam?  Fast forward to 18 years later, e-commerce is the dominating business model and almost all business would have their own company websites that are nicely designed with rich customer features.

Blockchain technology is here to stay.  It is a revolutionary technology that can greatly eliminate the role (and hefty fees) of banks and clearing houses.  After staying the technology behind some cryptocurrencies I don’t believe Bitcoin is a scam.  However, many alt-coins have no solid business plans and offer little values for their customers.  A business has to provide useful value to the public in order to thrive and survive.

The recent collapse of the crypto industry, in my opinion, is a healthy process where good alt-coins will survive while the bad ones will be blown away.  This is how free market works.

I have started investing some money into Bitcoin, Ethereum and NEM, although I am cautious that I only invest what I can afford to lose.  There is still too much uncertainty and volatility in the crypto market.

Friends, if you are interested in cryptos, I found this report pretty helpful and convincing:  Free Crypto Research Report

The Crash Course

A couple years ago, I came across this website Peak Prosperity and watched their condense version of “Crash Course” (2008 version).  It was quite an eye-opener.  The course talks about the effect of exponential growth, how money is created, economy, oil and environment.  The underlying message is that with depleting resource we are heading into a collapse; but we can still thrive through the hard times.

I don’t believe the authors are Christians as I don’t see any mention of biblical approach when facing a crisis, but I think the material presented in the video would help us understand the coming challenge human are facing.  Here is the link: Crash Course on Youtube

If you want to download the entire course (in .zip and .webm format): Download Entire Course

Ultimately, no matter how well we are prepared physically, only Jesus Christ can save us from all troubles.  Listen to the still small voice of the Holy Spirit and be saved TODAY.

A reflection of year 2017

2017 will be history soon as the people around the world welcome 2018 in a week or so.

As I reflect on 2017 there are many incidents, trends and signs that alarmed(and still alarming) me:

Conflict in Syria
The war-torn country of Syria has been a chessboard for foreign powers such as America, Russia, China, Israel, Saudi Arabia, Turkey and Iran. Middle East is the powder keg for regional war because of historical, religious and economical reasons. Regional war can easily morph into global war.
Nuclear crisis in North Korea
The continuous missile testings from North Korea have occupied the mainstream headlines for the latter part of this year.  What worries me is the attitude of Communist China.  China has been preparing their troops for a possible war with US, should Trump ordered a preemptive strike against North Korea.  If war erupts between US and North Korea, China might seize the opportunity to invade Taiwan and impose further military dominance in South China sea.  Should a nuclear device being denoted in North America or North Korea, the fallout of nuclear disaster would be the nightmare of several generations.
Rise and fall of Cryptocurrencies
I recently learned that the idea of cryptocurrency such as “Bitcoin” was discussed as early as 1997 by NSA.  Please Read:
Evidence points to Bitcoin being an NSA-engineered psyop to roll out one-world digital currency
What an eye opener!  As much as I admire the idea of blockchain technology that could potentially free us from the over-reaching of central bankers and governments, it could be the tool that would enslave humanity in the coming anti-Christ beast system.  As of this writing, Bitcoin has dropped from its peak of close to $20,000 to $14,000.  Other alt-coins share extremely similar price pattern with Bitcoin.  Ultimately, as I have warned on this site, cryptocurrency is a highly risky business and one has to be prepared to lose all his investment, much like playing with options and futures.
I have read reports that people are taking out mortgage loans and maxing out their credit cards to  buy cryptocurrencies.  To me, this is a sign that the crypto market could collapse soon.
Discrimination against Christian in Western countries
Christians in the western countries have been routinely discriminated and demonized by mainstream media, liberal governments and LGBT communities.  Christians are criticized for opposing legalization of abortion and same-sex marriage through avenues of peaceful protest, prayers and expressing personal views on personal web channels.  Yet, all over the world Muslims terrorists have been expressing their religious beliefs by smashing into crowds or chopping heads off the innocents while yelling “allah akbar”.
 Strangely, no media or LGBT communities dare to impose the charge of “hate crime” onto these Muslims terrorists.
Canada, under the leadership of  LGBT-Muslim-friendly Trudeau and Ontario, under the leadership of lesbian Wayne, have been waging war against Christians since the Liberal government took power.  From passing Bill C-279, Bill 28, Bill 89, the lawmakers have stripped away traditional parental rights and religious freedom while forcing the acceptance of gender ideology and socialism onto the general population.
Canada is definitely NOT a Christian nation because the government is starting to marginalize Christian ministries and churches to practice their faith.  For example:

I expect the persecution will intensify in year 2018 and I pray that our Christian readers keep on praying and stand strong in their faith.  Our Lord is coming back soon!

Widespread use of AI, virtual reality and robots
The Fourth Industrial Revolution is on the door stop.  In fact, we are in its initial stage.  The rapid adoption of “artificial intelligence, robotics, the Internet of Things, autonomous vehicles, 3D printing, quantum computing and nanotechnology” across all aspects of businesses will undoubtedly revolutionize our daily lives, again.
My wife is a critic of the previous 3 industrial revolutions.  She believes that factories, mass production and digitization of data are a curse to humankind rather than blessing.  Truth to be told, she is right on the money.
We read that greedy entrepreneurs lure farmers to work in factories and live in cities with poor conditions.  We read that workers in mass production facilities earn meager wages with long hours.  We read that people today are engulfed in texting, entertainment, electronics and consumerism.  People gladly give up their liberty and privacy in exchange for convenience.
We have lost the essential life skills that our great-grandparents/grandparents once possessed.  Instead, we rely heavily on huge corporations and governments – the “grid”.  As a result, the governments and international corporations keep expanding their realm of influence and ubiquitous surveillance on our lives.
Do we really have more “time” for ourselves, our families and others while being surrounded by these high-tech, “smart” gadgets?
As AI machines become smarter and eventually outsmart humans, nobody can predict what a supercomputer would do.  It only takes 4 hours for an AI machine to learn chess from scratch to beat a world class chessmaster.  We are creating a monster that we cannot control.
The automation of production using robots will put millions of people out of work.  Although the idea of universal basic income for everyone sounds like a good idea, it will utterly destroy the society.  People without meaningful work will be depressed and become desperate.  It is work that gives us value, dignity and satisfaction.
People are already addicted to the cyber world where one can hide or disguise his identity.  Fake news are also prevalent and easily fabricated on the internet with spiral effect.  Now comes virtual reality.  I am afraid that people can no longer distinguish what is real and what is not.  Remember the mayhem that pokemon go  brought to us last year?  Young people are especially susceptible to this highly stimulating technology.
I am worried that people will totally lose their common sense and the ability to distinguish between right and wrong (which most people are already lack of).
Earthquakes, volcanoes and mini ice age
Volcanoes eruption and high magnitude earthquakes have increased rapidly for the past decade.  Many scientists warn that the “Big one” is looming.
It seems that from historical record that the earth has a cooling and heating cycle.  According to John Casey, authors of book Cold Sun and Dark Winter, the sun has a cycle of 206 years and the temperatures will bottom out in around 2030.  In other words, we are approaching a mini ice age.  Crops will fail, winter will be colder than usual with heavy snowfall while summer will be short and cool.  There will be mass migration to warmer regions around the equator.  A quick interesting reading can be found here.
The earth condition is worsening.  Climate changes, natural and man-made disasters will intensify.  Prepare, prepare and prepare.
Most importantly, prepare your heart to accept and walk with Jesus Christ because His word has told us these things will happen (read Matthew Chapter 24).  Christians, be not dismay because this is our final tests of our faithfulness toward our God!
The best part of the story?  God wins and we are partakers of the victory.  Despite of all the alarming signs, the coming challenges present a great opportunity for soul winning.  As societies fall apart because of wars, famines, earthquakes and pestilence, people will seek answers and comfort.  The Bible has ALL the answers.
Even so, come quickly Lord Jesus.

Did you get into the Bitcoin frenzy?

I discussed my perspective on cryptocurrency in my previous post back in March.  Bitcoin was trading around $1000-$1500 and Cliff High predicted that it would rise to 3x more than gold.

Fast forward to December,  bitcoin is 13x more than gold, with unbelievable growth in just 1 year.  I did not invest any money in Bitcoin, but I did buy some “cloud mining” shares in Ethereum a couple months ago.  Personally I think Ethereum has higher potential and flexibility than Bitcoin.

Cryptocurrency is full of potential and might revolutionize the way human trade with each other.  However, the frenzy around Bitcoin constitutes a classic bubble ready to be burst any time.  I found an excellent article that I would like to share:

(taken from Bitcoin Mania Parabolic) by Adam Hamilton

Bitcoin’s meteoric skyrocketing this year has been astonishing, captivating traders across the globe. This once-obscure cryptocurrency has exploded into the world’s hottest market. With fortunes being won on paper, everyone is talking about bitcoin. But with its price shooting parabolic, unfortunately this wild ride has all the hallmarks of a classic popular speculative mania. And those all end badly, totally collapsing.In the annals of financial-market history, the word “mania” is never used lightly. These are very-rare events where some market blasts higher so radically that it captures the popular imagination. The dictionary definitions of mania include “an excessively intense enthusiasm, interest, or desire” and “a pathological state characterized by euphoric mood, excessive activity or talkativeness, and impaired judgment”.

The seminal book on popular speculative manias is Charles Mackay’s “Extraordinary Popular Delusions and the Madness of Crowds”, first published way back in 1841. Manias are certainly nothing new, they have been periodically erupting for many centuries if not millennia. Mackay’s incredible work is one of the few must-read books for every investor. I’ve read it several times in my life, starting back in college.

Mackay’s title is brilliant, perfectly summing up manias. They are truly extraordinary popular delusions, illustrating the madness of crowds. Objectively, this year’s extreme bitcoin action definitely fits that bill. I say this as a lifelong student of the markets. Like the objects of lust in past popular manias, bitcoin and its underlying blockchain technology have real potential to change the world. But that doesn’t justify its price.

As a techie, I started getting interested in bitcoin about 5 years ago, well after its birth in January 2009. It was intriguing as the world’s first decentralized digital currency, an Information Age end run around the established government fiat-money systems relentlessly being inflated away by central banks. Bitcoin’s never-unmasked creator going by Satoshi Nakamoto was a marketing genius, wrapping bitcoin in gold terminology.

The “coin” suffix implied bitcoin is money, rather than a virtual fiction with artificial scarcity. And it used a novel distributed-ledger technology called blockchain. That is a record of all bitcoin transactions that is broadcast and validated by the entire bitcoin network. This ensures that bitcoins can be transferred with no counterparty risk, trust is irrelevant. Maintaining the blockchain is called “mining”, again bringing gold to mind.

The countless computers all over the world participating in recordkeeping for bitcoin’s blockchain work to simultaneously solve complex cryptographic problems, or hashes. This mining guarantees that all new bitcoin transactions are legitimate. While it is computationally-intensive which requires much electricity, bitcoin ingeniously awards participating miners with newly-created bitcoins. That’s a heck of an incentive today!

Somewhat like gold, the bitcoin supply grows at slow and ever-decreasing fixed rates. Today there are around 16.7m bitcoins in circulation. 12.5 new ones are created every 10 minutes and distributed to the miners maintaining the blockchain. That supply-growth rate will be gradually halved again and again until the bitcoin supply hits its hard-coded maximum of 21m bitcoins after 2110. So bitcoin’s supply is artificially limited.

Repurposing old computers to mining is what sparked my initial interest in bitcoin. I run a small financial-research company where we must periodically replace our high-end computers. So I investigated putting some of our old put-out-to-pasture ones to work mining bitcoins, but at the time the electricity cost well exceeded the resulting bitcoins’ value. Back then bitcoin mining didn’t require specialized custom-made rigs.

When bitcoin was younger, normal computers could solve the necessary cryptographic hashes to keep the blockchain up to date. As this distributed ledger grew, more-powerful high-end computer-graphics cards were needed. Today bitcoin mining requires computers with processors designed from scratch to do nothing but grind on the blockchain, called application-specific integrated circuits. They get very expensive.

Truly bitcoin and its brilliant blockchain distributed-ledger system are amazing technologies. They will ultimately reshape how we buy and sell goods and services, shifting the balance of power in currencies back away from centralized governments. It’s hard not to be a bitcoin enthusiast. That being said, it’s critical for traders to divorce bitcoin’s extreme mania price action from these technologies’ future potential.

For 18 years now, I’ve written an essay like this nearly every week. Wednesday mornings I decide on a market topic, research it, and build any charts. So our Zeal charts are always current to Wednesday’s close. Then on Thursday I write and proof each essay before publishing it Friday morning. Normally that day-and-a-half between finalizing the data and releasing an essay doesn’t matter, but bitcoin’s mania is crazy.

Bitcoin trades nonstop around the world, with transactions always happening and the blockchain always being updated. Around the normal US stock-market close this Wednesday, each bitcoin was priced at $12,968. So all the data, charts, and analysis in this essay is based on that ancient price. Merely 18 hours later as I pen this essay, bitcoin has rocketed another 18.6% higher to $15,379! Its ascent is meteoric.

So who knows how high bitcoin will be when you read this. But the higher bitcoin skyrockets, the more it emphasizes the extreme danger inherent in this popular speculative mania! Bitcoin is absolutely deep in a monster bubble, defined as “an increase in the price of a market that is not warranted by economic fundamentals and is usually caused by ongoing speculation in the expectation that the price will increase further”.

This first chart looks at bitcoin prices over the past couple years or so. Bitcoin has rocketed parabolicin 2017, soaring vertically in what looks exactly like a popular mania blowoff top. Vertical parabolic gains are mathematically impossible to sustain for long, as they would soon suck in all the available money on the entire planet! If this chart doesn’t terrify you, you should go read Mackay’s mania book before it’s too late.

Bitcoin was no slouch in 2016, soaring 123.6% higher in what looked like a late-stage bull market. That is hardly a blip on today’s chart though, as that morphed into a full-blown popular speculative mania this year. As of Wednesday’s sub-$13k price, bitcoin had skyrocketed 1251.9% higher year-to-date and a mind-boggling 1565.6% higher since its early-January low! These mania technicals are extreme beyond belief.

Like gold and many other investments including lots of stocks, bitcoin produces no cash yields and thus can’t be valued with conventional valuation analysis. So no one has any idea what it’s worth. The range of guesses is vast, running from zero to hundreds of thousands of dollars per bitcoin! But even in the absence of any fundamental valuation, bitcoin’s price action itself proves it’s exceedingly expensive today.

Obviously Wednesday wasn’t this bitcoin speculative mania’s peak, but let’s assume it was to use as a reference point for analysis. Bitcoin’s “terminal gains” as of the middle of this week were astounding. In the past month alone it had soared 87%, nearly doubling! It had skyrocketed 197% in 2 months, 280% in 4 months, and 459% in 5 months. This left bitcoin radically overbought, trading at 3.70x its 200-day moving average.

The problem with such extreme mania price gains is they soon collapse under their own weight. Over the past week ending Wednesday, bitcoin was surging an average of 5.9% per day. Two of those days had 9.7% gains. Literally nothing can rally 5% to 10% per day for long, as the math is truly impossible. Think of that old rule of 72, which is used to approximate how long it takes for any investment to double in price.

It is normally applied to years, where 72 is divided by the average annual return to figure out about how many years it will take to grow 100%. 72 divided by 7% for example works out to about a decade to see 100% gains. But at 5% or 10% compounded daily as bitcoin is doing, its total value will double in just under 14.3 and 7.3 trading daysrespectively! Even to a casual observer that sounds absurd, wildly unsustainable.

Early Thursday morning, the total market value of all bitcoins in circulation was already around $250b. If bitcoin doubles again over the coming weeks and months, that would soar over $500b. Just one more doubling after that would take it to a staggering market cap of $1t! While anything is possible, that seems wildly improbable. For comparison, the Fed’s latest read on its total M1 money supply is running near $3.6t.

When anything shoots parabolic in a popular speculative mania, exponentially more capital inflows are required to sustain such extreme gains. It doesn’t take many doublings in price and market cap to suck in all available moneyon the planet! While bitcoin certainly enjoys a popular niche, there’s zero chance that global investors will sell sizable fractions of their bond, stock, gold, and cash holdings to buy bitcoins.

Thus extreme gains are never sustainable, as the collective buying power of even populations caught up in manias soon exhausts itself. Eventually everyone interested in buying bitcoin has already bought, drying up their pools of available capital. When those massive bubble-fueling capital inflows peak then taper off, market gravity reasserts itself and the stratospheric price starts plummeting back down to terra firma.

Unfortunately naive speculatorsdon’t realize how extreme doublings and quadruplings within a matter of months truly are. That makes it easier for them to get sucked into mania psychology. They read about the blistering gains, everyone is raving about the bubble market, so they throw caution to the wind and buy in super-high. Even worse, many traders rushing to buy into parabolic bubbles borrow money to do it with!

At that point all rationality is thrown out the window, it’s an extraordinary popular delusionas Mackay wisely wrote 176 years ago. The price is totally disconnected from reality, and the sole reason capital is flooding in is because it is soaring. That becomes self-reinforcing for a season, buying fueling gains and greed which leads to even more buying. While exciting, vertical parabolic blowoffs are exceedingly dangerous.

Every popular speculative mania in history has failed spectacularly, the bubbles bursting and crashing, since capital inflows can never grow exponentially for long. That’s going to happen to bitcoin too, without any doubt. The deluded speculators who succumb to the temptation to buy in high, especially if they use leverage, are going to get slaughtered. An infamous past bubble helps illustrate bitcoin’s extreme dangers today.

This final chart again assumes Wednesday was this bitcoin bubble’s peak for the sake of analysis. The past couple years’ bitcoin action is superimposed over the notorious silver bubble that crested in January 1980. Both datasets are indexed at 100 at their respective peaks to render them in perfectly-comparable percentage terms. The bottom axis shows time elapsing before and after the peaks measured in months.

The parallels between bitcoin’s extreme parabolic price action over the past 6 months or so and silver’s in its bubble’s final 6 months are uncanny. While very rare, popular speculative manias are nothing new. The terminal gains of bitcoin and silver are remarkably similar as the table above shows. If these data series were not labeled, today’s bitcoin bubble and the 1979 silver bubble would literally be indistinguishable.

As of Wednesday bitcoin had rocketed 87% in its latest month compared to 104% for the silver bubble in its terminal month. At 2 months out they were identical at 197% and 196% gains. The same was true at 3 months with 181% and 179% gains. In their final 5 months, they skyrocketed 459% and 417% higher. Their terminal 6 months saw 366% and 402% gains. This bitcoin bubble is behaving just like the silver bubble!

While bubbles are incredibly exciting and fun when they shoot parabolic, the aftermath is catastrophicfor traders who buy high. Bubbles always burst, leading to full-on crashes that proceed long busts. Just a month after silver peaked at $48.00 per ounce in January 1980, it plunged 35%. In the first 2, 3, and 4 months post-peak, silver plummeted 54%, 73%, and 76%! Bitcoin faces similar extreme downside risks today.

Once this mania bitcoin bubble bursts, and it will, the odds are very high that bitcoin will lose 50% to 75% of its value within a few months on the outside! Everyone owning bitcoin today must be prepared for brutal near-term downside proportional to this year’s bubble upside. When a bubble bursts it rapidly destroys most of the paper wealth that bubble created, which was really an illusion all along if not cashed out.

And once popular speculative manias inevitably fail, prices don’t return to those extreme bubble-peak levels for an awfully-long time. That silver bubble peaked 37.9 years ago, and there are still many silver enthusiasts today. Like the hardcore bitcoin faithful, plenty of people love silver with a religious-like zeal believing it is the ultimate investment. In nominal terms, silver didn’t exceed that bubble peak until April 2011.

After taking a staggering 31.3 years to regain January 1980’s high, silver held it for a single day and has never returned since. And in real inflation-adjusted terms based on the US CPI, silver’s bubble peak in today’s dollars was over $152 per ounce! Obviously silver has come nowhere close to trading near those same real levels again. Prices are so extreme after popular speculative manias they may never recover.

A far-milder bubble than both bitcoin and silver arose in the stock markets in late 1999 and early 2000. Like bitcoin, the technology of the Internet was amazing and would forever change our world. Yet stock prices got so extreme then that the NASDAQ didn’t revisit its March 2000 closing peak for the first time until April 2015, fully 15.1 years later! And that only happened because NASDAQ’s components greatly changed.

The history of popular speculative manias proves that even if bitcoin and its underlying blockchain are here to stay, it will likely be many years or decades until bitcoin prices regain their bubble peak wherever that happens to be. Once this bitcoin bubble inevitably pops, there’s virtually no chance its traders will be made whole again. They’ll hold through the burst in hopes bitcoin will rebound, but bubble poppings are final.

And it’s not just bitcoin’s extreme price action that reveals it’s in a bubble fueled by a popular speculative mania. Anecdotal stories abound showing a huge influx of young and naive “investors” who have never lived through a bubble. The leading bitcoin broker in the US is Coinbase. Its accounts are exploding as people rush to pour money into this bitcoin mania. By late November, Coinbase’s active accounts had hit 13.3m!

This is staggering growth, as Coinbase reported just over 5m accounts as 2017 dawned. 13.3m is way bigger than stock broker Charles Schwab’s 10.6m at the end of October, and threatening to rival the 24.9m accounts stock broker Fidelity had at the end of June! As in all manias, the vast majority of these new bitcoin “investors” have drank the Kool-Aid and believe bitcoin’s technology justifies its extreme price gains.

When markets soar so high all rationality is thrown out the window, the only reason to keep buying is the greater-fool theory. Late-stage traders buy super-high in the hopes they’ll find an even greater fool to sell even higher to later! Soaring prices can entice in big new capital inflows for a season, but eventually the price levels get so high that it’s impossible to sustain exponential buying. Then the bubble bursts, prices crash.

Even if bitcoin and blockchain forever change currencies in the future, nothing justifies doublings and quadruplings in bitcoin prices in a matter of months. Such extremes are never sustainable, all popular manias fail spectacularly even though the technology investors were excited about lives on and indeed changes the world. I’m really excited to see bitcoin and blockchain applied to digital gold in coming years.

Gold has been universally valued across the world for millennia, yet it’s impractical to use as money for most transactions. But if bitcoin-and-blockchain technologies were applied to gold, this metal could easily be subdivided into the tiniest of increments and traded globally. A gold version of bitcoin would have to be 100% physically backed by gold held in secure vaults in safe, trusted countries. It’s already being worked on.

But the great value of bitcoin-and-blockchain technologies doesn’t make bitcoin immune from the natural consequences of this year’s bubble. Bitcoin is far too large now to keep doubling on a monthly basis, it’s impossible. And there’s never been a past bubble where prices stop soaring but don’t crash, instead just rallying on from there quasi-normally. Greedy traders start selling when the parabola stalls, driving the burst.

One of the reasons bitcoin has skyrocketed is there are virtually no sellers relative to the great herds of new buyers flocking in. That is all going to change soon, which presents big risks of popping this bubble. Both the CBOE and CME are set to launch actual bitcoin futures in the next week or so, which will allow professional speculators to not only buy bitcoin but short sell it at scale. That alone may very well slay this bubble.

Bitcoin is pretty inefficient too, with transactions taking up to 10 minutes to process as the blockchain gets bigger and bigger. Transaction costs are also skyrocketing, leading some major businesses like the Steam online video-gaming service to stop accepting bitcoin as payment. Its owner Valve says it now costs about $20 to process a single bitcoin payment, far too expensive for this company’s massive 67m users.

As bitcoin grows, the blockchain itself is getting ever-more unwieldy. That ledger recording every single bitcoin transfer ever is requiring progressively more computing power to process, making mining for the network much more expensive. Recent estimates place bitcoin-mining electricity usage at 0.13% of the world total. Asingle bitcoin transaction now requires enough electricity to power an American house for a week!

As long as bitcoin prices are sky-high, large-scale mining operations to process bitcoin’s cryptographic hashes are profitable. But when bitcoin crashes after this bubble, computers tasked to mining will likely plunge in parallel. While the hashes are dynamically adjusted to account for network mining power, this could still increase transaction times as blockchain grows. That would make bitcoin less attractive as a currency.

As a professional speculator over the past two decades or so, I wouldn’t touch bitcoin with a ten-foot pole today. Buying into a popular speculative mania that’s already rocketed parabolic is the height of folly, guaranteeing massive losses in the near-future. If you were shrewd enough to buy bitcoins before the last 6 months, you should be scaling out and taking profits. One bitcoin expert calls it a “consensus hallucination”.

At Zeal we’ve spent decades studying and trading the markets, building wealth normally and consistently through profitable real-world trading with a contrarian bent. This means buying low and selling high, so bitcoin is off the table. But as of the end of Q3 we’ve realized 967 stock trades recommended in real-time in our newsletters since 2001, which averaged stellar annualized realized gains of +19.9% over that long span!

The key to this success is staying informed and being contrarian. That means buying low when others are scared, not when they are euphoric like in bitcoin’s mania. An easy way to keep abreast is through our acclaimed weekly and monthly newsletters. They draw on my vast experience, knowledge, wisdom, and ongoing research to explain what’s going on in the markets, why, and how to trade them with specific stocks. Easy to read and affordable, they’ll help you learn to think, trade, and thrive like contrarians. Subscribe today, and build lasting wealth instead of getting obliterated when bitcoin’s bubble bursts.

The bottom line is this year’s bitcoin popular speculative mania has gone parabolic. Such extreme gains are never sustainable, as they require exponentially-growing capital inflows. Once this greed-drenched bubble stage is reached, it’s only a matter of time until the burst inevitably follows. The resulting selling from panicking traders is so violent that most of the mania gains are fully annihilated in a matter of months.

While bitcoin and its blockchain distributed-ledger technologies are amazing and will indeed likely change the world, they don’t justify bitcoin’s extreme vertical gains. Plenty of past bubbles were based on great new technologies too, but those prices still collapsed once the supply of greater fools exhausted itself. After skyrocketing so darned fast, bitcoin is certainly the riskiest major investment in the world. Caveat emptor!

Whole World in Debt

Many years ago I wrote a page on this website: Purpose to Keep out of Debt.  I am glad to say that the Scripture is full of truth and wisdom even when it comes to personal finance.

We have been blessed to out of any debt (mortgage included) for the past few years and the tremendous peace of mind and financial freedom we can experience is beyond words.  Of course, we lived on a strict and frugal life as much as we could (still are).  Growing our own food in summer, learn to fix things around the house, learn to sew, buy in bulk, eat healthy, etc….

Most significantly, we don’t own any high-tech gadgets like most of our friends do.  We did not subscribe to any cable channel or satellite TV for 1 day in our marriage.  We never bought a new car or van.  Our purpose is simple:  to get out of debt as quickly as possible.

Years of low interest has created massive debt worldwide.  Living in Ontario, Canada, we are a province that is now the world’s most indebted sub-sovereign borrower.   That means we have to pay higher income tax, sale tax, property tax etc….in the coming years to foot the bill.

My father once said, “Debt is good.  It is the driving force of economy.”  I did not agree.  Debt is never good.  Spending on something you cannot afford while hoping that you can repay it later, in my opinion, is a risky business.  How do you know if you will have a job tomorrow or next week to repay the debt?  Why not curtail your impulse on laying your hand on that shiny new car and go for a dull looking yet reliable used vehicle?

Several states in the US are now in danger of shutdown because of deficit.  I think this is a reflection of the current situation of the most powerful country in the world.  Debt is out of control:  The World Is Now $217,000,000,000,000 In Debt

Friends, soon or later the tidal wave of debt will crush the financial system and might trigger world war.  I know I have been talking about this for 2 years and nothing seem to happen.  However, I have read from multiple sources that the latter part of this year or early next year (2018) will be the trigger point of the collapse.

Get out of debt and start preparing.



With the hype of exploding Bitcoin prices in the media, “cryptocurrency” is the new buzz word on the street.  I have expressed my opinion in my post in March.  Since then the price of Bitcoin has more then doubled.  In fact, other digital monies such as Ripple, Ethereum, LiteCoin have all increased in market capitalization.

So I have revisited Bitcoin and still maintained that cryptocurrency is a risky investment with high return potential.  Also I have learned that Bitcoin network can only process 7 transactions per second, comparing to Visa’s 2000 to 7000 transactions per second.  Sooner or later, a bottleneck will  suffocate the Bitcoin network and users might abandon it en masse to a newer and more efficient cryptocurrency.

Which prompts me to realize that while Bitcoin has a hard limit of 21 million coins that can ever be “created”, there can be endless supply of other cryptocurrencies.  The creator of Bitcoin had a brilliant idea to create a financial system based on limited supply of money because fiat/paper currencies always fail; however, I am afraid that his effort would proved futile because in the digital world, anything can be created in infinite (or close to) quantity.

The rise of Bitcoin and its peers reveals that the public are awakening to the fact that the global central banks’ policies are failing and the purchasing power of fiat currencies are declining.  Years of cheap money have created bubbles of stocks, real estates, bonds while we continue to see staggering numbers of auto loans, mortgages, student loans, bankruptcies, etc…

So, would I buy any cryptocurrency?  I would be cautious and approach it like any stock with the mentality that all the investments could be lost.  Gold and silver, being physical asset, will also be the tool for wealth preservation and storage of value.

Here is an interesting article about Bitcoin:


Most people know about bitcoins nowadays, especially when it surpasses its price surpasses gold recently.  In case you want a quick comparison between gold and bitcoin, here is a good graphical presentation:

I remember looking at getting some bitcoins in 2011 when it was still cheap.  But I didn’t know much about it and as a general rule of investment, one should not invest in something where he doesn’t have sufficient knowledge.  According to the following interview at USAWatchDog

Clif High predicts that bitcoin will rise to 3x more than gold.  Whether that is true remains to be seen.  My personal take on bitcoin is it would be a risky investment.  If you have the extra money to lose it would not be a bad idea.  However, I still hold this rule: “If you cannot touch it you don’t own it.”  That applies to digital blockchain currency such as bitcoin.

Anything on the internet can be hacked, traced and controlled.  Gold and silver is “God’s money”.  Bitcoin, while it has great upside potential, is still virtual money.  As an old fashion guy, I will stick with physical assets.

At the rate of global debt accumulation, the burst of financial bubbles will be gigantic with dire consequence.  Of course, I don’t wish anyone to be harmed adversely during the process, but unfortunately many people will be hurt.  Gold and silver will be one way to maintain your wealth.

Charles Nenner-2017 Prediction-Global War Cycle Coming into Danger Zone

Last year I have warned and anticipated an economic collapse, which did not take place to the extent that I have expected.

Recently, Greig Hunter from UsaWatchDog  interviewed cycle expert Charles Nenner, who has correctly predicted that there will not be a major collapse in 2016 but one coming in fall 2017.  The entire interview can be heard here:

With Mr. Donald Trump entering the White House and all the opposition forces coming from the Deep State and military-industrial complex, there is still a possibility of civil war erupting in the US.  The unfunded liability of $200 trillion dollars in the US will implode some day.  It would be wise to prepare for what is coming this year.

Remember, you never waste on the effort and resources you put into your preparation.  You can always eat your freeze dried food and drink the storage water.

India – Banning Cash and Money

It was reported that since Nov 29, 2016 India has implemented the law to ban large denomination cash of 500-rupee ($9.7) and 1,000-rupee notes ($19.50), which account for more than 85 percent of the money supply.   India, unlike most Western countries, do not have electronic payments in most rural areas and vast majority of people still use cash for transaction.

India pulled 86% of its cash out of circulation. It’s not going well.

Why the rush?  Well, we find out today that they are banning gold also:

India Confiscates Gold, Even Jewelry, In Raids On Hidden Money

As I pointed out earlier in my post,the globalist needs to implement a cashless society and control everyone via digital currency.  It is never about the convenience and security of customers.  NEVER.  The banker could care less about your and me.

Think about this.  If every transaction can be traced, they can tax the daylight out of us however they wish.  In addition they can easily eliminate any opposition to their agenda by freezing the opponent’s bank account.  This also ties into the BEAST system as prophesied in book of Revelation.  No body can buy or sell without the mark.  Cashless society would be the precursor of such system.

My advice?  Use cash as much as possible and start growing your own food!


Deutsche Bank Imploding and WW3 Starting?

The largest German bank has been in trouble for a while and now we are seeing it imploding as its stock price has been declining since beginning of the year.  The root cause is Deutsche Bank has massive exposure to derivatives, over-leveraging  itself in the dangerous games of financial gambling.

Since Germany is the major economic powerhouse of Europe, the collapse of Deutsche Bank is significant and may be worse then the fall of Lehman Brothers in 2008.  Many other financial institutions have close ties with Detusche Bank and when it falls, it will have a domino effect upon the entire European zone. You can count on the fact that “bail-in” laws will be implemented, meaning the depositors’ assets will be used (confiscated) to save the “too-big-to-fail” banks.

I was a co-op student 17 years ago with Deutsche Bank located in downtown Toronto.  I was working on the trading floor, which was a very busy and exciting working environment.  Being a co-op student, I learned a lot about the financial world and started trading stocks and options.  Needless to say, I made some profit and lost some over the years.  My overall impression is that the financial instruments have been invented to such a complexity that a common Joe would never be able to understand.

No wonder the elites can steal and own more than 50% of the world’s resources.  They have rigged almost all markets to their benefits.

Read Deutsche Bank Collapse.

On the other hand, the war drum has never been louder between US/Nato and Russia/China.

Read Minutes to midnight

Cutting diplomatic channels is usually a precursor to physical war.

I have no doubt that the NWO is pushing for war, be it civil war or global war.  The world is very close to World War 3 and you are naive to think that it will not happen in your life time.

Be prepared.  Make sure you are covered under the blood of our Saviour Jesus Christ.