Giving an Ear to the Oracle

Is it ever a wise idea to argue with one of the greatest investment minds the world has ever known since Benjamin Graham? Even more, is it wise to argue with someone who has not only learned from Benjamin Graham's ideas, but perfected them and put them to work in a way that produced results that put him in the top ranks of the world's richest men? A position that has fluctuated a bit over the years, but has still firmly planted him within the top five for decades?

Of course I am talking about the Oracle of Omaha. The brilliant money mind who turned a pretty much defunct and dying textile business into one of the largest and most successful holding companies the world has ever known.

Berkshire Hathaway, headed by none other than Warren Buffet.

Warren Buffet currently sits 5th in position on the Forbe's Most Richest list with a cool $118 billion to his name.

Over the years I have taken quite a few lessons from Buffet—as anyone interested in business and investing should. A good portion of my foundational fundamental understanding of how to make money has come from things I have taken away from the many lessons Warren Buffet has provided—pretty much entirely free—over the many years he has adorned the limelight with his ideas and very simple philosophy and principles.

The man simply knows how money works and for anyone who wants to be in the know too, you have to keep your ears and eyes wide open and listen to what he has to say.

Of course I do not agree entirely with him. My own investment style has elements of things I have learned from Warren Buffet over the years. But I do not do it exactly the way he does it. But the foundations are still very much there even if my strategy is different.

Still, I'd be a fool to disagree with him regardless of how I go about my own ideas and philosophy, or investment strategy or style.

Around these parts since day one, while I have an interest in cryptocurrency, I have also been one to write about it and talk about it in a manner that is quite a bit different than many others here and on noise and in other media circles where crypto gets talked about.

I am never a naysayer. But I do approach the offering of my perspective on it with the foundational basis being formed from things I've learned from Buffet and my own personal experiences with money and the markets.

Part of that basis of perspective is that I have been doing this for a while. Moreover, I have been doing this for much longer than crypto has been around. Warren Buffet has been doing it for much longer than I have been around.

I have written extensively on my thoughts that crypto can be a lot of things, but I think most of us (who have an interest in crypto) are viewing crypto with a bit of a blind eye to all of the things that we should be much more cognizant of.

What I mean to say is that we have all of these people out there who have built great and successful businesses, who understand money and wealth building, who understand what actually makes money worth something...

And a lot of us are turning a blind eye to them. We are calling them "old school," or "old money." We are accusing them of lacking vision, having opposition to change, or denying "technological advances."

The aim is to prove them wrong and to tell them that they simply don't know what they are talking about.

I have seen the articles and comments and posts regarding Warren Buffet and Charlie Munger as "worn out hacks." Comments that are directed at them simply because they aren't advocates for everyone's beloved, and supposed, answer to all the world's money problems.

Sometimes younger people convince themselves that "they know better than the older guys," and they work very hard to prove themselves right. More often than not, they are actually wrong.

I talked about this quite a lot during the famous dot com boom of the 90s. It was an interesting time where suddenly businesses came out of nowhere with no real products, no real revenue—they really didn't produce anything.

And yet they were able to rise to massive valuations, making instant millionaires and billionaires out of a large number of people. There is an interesting comparison to the mindset of all of these people during the dot com boom.

"All the old concepts of business are out the window. Our parents had it wrong about how to make money," and so on and so forth. But there is one other mindset that was very prevalent during this time that makes it strikingly similar to the crypto experience we have now.

Almost everyone was willing to take their paychecks in the form of shares of stock in these companies at the time.

It was a new way. A new way to money. People were willing to risk it all because they believed, and believed with certainty, that all of the things that worked in the past were somehow brilliantly replaced with fresh new ideas about it all that made young people very rich much faster and much earlier than their parents did.

This does sound quite familiar, because that is what everyone seems to be saying now about crypto.

You don't need to produce something. You don't need to generate money. All your old ways are proven wrong. We have the right idea. We are all rich faster now to prove it. This is the new way. This is the future. Get with the program, forget what you thought you knew, and now listen to us—because we have the answers.

Only, they were wrong. In fact, they were dead wrong. The markets sunk, most of the dot com businesses went bankrupt and massive fortunes paid in shares of stock instead of real money put all of these rich quick guys back to the starting line.

The old guys were right after all.

The dot com era did not mark the beginning of a new era. It marked a fundamental understanding—and provided a stark reminder—that the inner workings of money and wealth building were still the same. Tried and true and undeniable.

Proven in the fact that the dot com thing never materialized to reshape and reform the way money is made or how wealth is created or how businesses become successful operations with lasting value.

Suddenly all of the naysayers were right, and all of the dot com folks were struck, perplexed and with egg on their faces.

There was a man who came out during this time and said, very clearly, "there is only one way to make money." He said, "You have to produce something otherwise nothing has value." He also said, "Something that never produces anything will never, therefore, produce value."

He was ridiculed then for his remarks. It was Warren Buffet. He is ridiculed now for his remarks that are quite similar when it comes to crypto. As are most guys in similar positions as Buffet is, who have proven their philosophies to the tune of massive riches.

Yet, despite history. Despite proof. Despite the fact being that the facts have never changed over the course of time, there are still those today willing to deny it. "No, this time we actually have this thing figured out."

If you have a guy telling you, who is the 5th richest man in the world, who has proven his prowess time and time and time again that he knows what he is talking about, tell you he'd give you $25 billion today for 1% of a chunk of all of the real estate in the world. If he would give you $25 billion instantly for a 1% chunk of all of the farmland, but he would not give you $25 for 1% of all the crypto in the world...

He might have a very strong and valid reason to hold that position. It should be something we probably should listen to. It is something we should probably take into very serious consideration as we continue to plod along pouring our life's fortunes into crypto and forgetting so easily about all of the other things that have worked, and worked well, in the past.

Proven, undeniable things.

As I have said many times, anyone can be wrong. Even Warren Buffet has said about many things he has been wrong many times. It is never to say that crypto is not what it wants to be or what people say, with conviction, that it will be.

It is to say that we have heard this story before. Many times. Over many years. In regard to many "new ideas." And every time this story has resurfaced, people have been proven in the end to be wrong.

To their detriment. To their loss.

A wise man once quipped, "We already have the wheel. No need to reinvent it. We know it works. Work on building on what the wheel does and improve on that. That's how we get things done."

What he was saying was that trying to reinvent the wheel is a waste of time and will probably bear no fruit. Those who focus on the car will do much better than those who are focused on the wheel.

It is something I think we all need to think about as the world of crypto goes forward. If one of the richest, most wisest men in the world have no interest in this "new idea," maybe we ought to be more interested in what he is seeing rather than what we believe he is missing.

I am not convinced the "old guys" are wrong now anymore than they have never been proven wrong in the past.

My main concern is always that a lot of people continually tend to focus on some other way than the proven way to get where they want to be financially in life. And the problem with this is that more often than not the proven way still works and the other way doesn't. Valuable time and energy, and money, are more often than not lost in the process of chasing things.

This is not to say to deny the possibility of a new idea. It is to say that if you don't build on the old idea at the same time, you are destined to lose if the new idea happens to be wrong.

Lead image courtesy of Pixabay, user Ramdlon. Smart Be Clever - Free photo on Pixabay