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CNBC on Wednesday ran a partition claiming bitcoin is a bubble. The segment began showing CNBC “Mad Fortune” host Jim Cramer calling bitcoin “monopoly money” and saying that installing in it is “pure gambling.” Cramer said gamblers would be better off in Las Vegas than put ining in bitcoin.
Bitcoin’s Place In History’s Bubble
After running intervals of financial experts denigrating bitcoin, the CNBC segment compared bitcoin to the tulip globule of the 1600s, the Mississippi bubble, the South Sea bubble, the tech bubble, the fiscal crisis, Japanese stocks, the Great Depression and the S&P 500 today. The graph compared the multiple starting prices for each of these bubbles, then acclaimed bitcoin’s multiple is approaching that of the greatest bubble in history, the tulip froth.
The segment cited the following signs of a bubble that bitcoin show offs: rapid pace movements, a lot of speculation without a lot of understanding of the risks, and a lot of non-traditional investors snatch in.
The narrator compared the bitcoin futures being launched by Cboe, the CME Band and Nasdaq to a move the Dutch made prior to the tulip bubble bang.
Also read: CNBC Mad Money host Cramer joins the ‘bubble’ brigade
‘Unexplainable Highs’
“For every asset suds, it’s the same story; otherwise level-headed people drive prices for a unarguable asset to unexplainable highs, whether that’s the price of beanie coddles, stocks, houses, or perhaps cryptocurrency,” the narrator stated.
Bitcoin, since its inception, has escalated almost 50-fold, the segment noted. If it maintains that growth estimate, it will eclipse the U.S. economy in a few years. Where other assets takings returns of some sort, bitcoin has no intrinsic value, and generates no receipts besides an expectation of further price increases, the narrator said.
“It’s valuable because woman think it’s valuable.”
“Bitcoin has gone parabolic, so that usually does not end effectively,” an expert named Cashin stated. Bitcoin’s price has gone “parabolic,” and such seethes don’t last, the segment concluded.
Featured image from Shutterstock.