Headlines such as Warren Buffett rips Wall Street for turning the stock market into ‘a gambling parlor’ and Warren Buffett Says He Wouldn’t Take All the Bitcoin in the World for $25 have been popping up in my social feeds ever since the Berkshire Hathaway Annual meeting.

I think the first thing to note, is that Buffet and Munger are essentially saying that they are against financial inclusion. Why? Because it makes it tougher for them to determine the value of, and predict how stocks will perform. Munger claims that “We have people who know nothing about stocks being advised by stock brokers who know even less.” This sounds almost like a politician claiming that certain people shouldn’t be allowed to vote, because they don’t know enough about politics, which would surely be met with harsh criticism as that goes against our core beliefs in America.

I do agree that the new capital flowing into the stock market has increased prices well beyond fair valuations. But does that mean the new retail investors are the problem? Or could it be the diminishing value of the dollar, the inability to save for the long term?

No, the problem is inflation, and that saving USD is a losing game. You HAVE to put your money to work, and the stock market has traditionally been the best, safest place to grow your net worth over long time frames.

Bitcoin has entered the chat:

What we have is a broken system, and the only way out (as far as I can tell) is Bitcoin. The current “system” is driven by economic incentives. All of the issues we see in the economy, including the outrageous gap between the rich and poor links back to one thing- inflation. We were taught in school that inflation is “good/healthy/normal” and never questioned it.

But let me ask you this- if technology allows people to create MORE things FASTER and at LOWER COSTS, then why do the prices INCREASE every year? Shouldn’t products and services become less expensive? Well, inflation requires prices to rise or the whole system collapses. It’s not capitalism’s fault, it’s the government’s for levying the secret tax called inflation that disproportionately hurts the lowest income class, and is an absolute windfall for the rich. Buffet and Munger are know this all too well.

My point is, that when people like Buffet and Munger complain about the stock market, and Bitcoin, that is a good thing. It means that they are losing their edge, and the playing field is leveling.

Why is Bitcoin the solution? It has a hard cap of 21M, meaning it CANNOT inflate, where as the Fed’s ability to expand the money supply of USD is limitless. We are trending towards Bitcoin becoming the global reserve currency, but it will still take many years to reach that status. Those who get in early (which it still is) will be rewarded.

If you don’t have any Bitcoin, you may find my previous article The Top 3 Ways to Get Bitcoin Without Paying a Dime useful! If you do, make sure you are earning interest on your holdings, this article will tell you how: Daily Compounding Interest with Bitcoin.

Originally posted by me, on Medium:https://medium.com/@kingoffreebitcoin/warren-buffet-and-charlie-munger-hate-bitcoin-and-thats-a-good-thing-8c9cb1a7d14d