Today Jason Burack of Wall St For Main St released a brief video drawing parallels between the recent run-up in cryptos (especially Ethereum) and other pre-collapse run-ups in history. Explaining that the likes of Doug Casey and Jim Rogers have always warned about the concept of “this time it’s different”, he provides a couple of examples.
The Tech Stock run-up saw talk along the lines of “there’s a new economy, all you need is a website and get eyeballs and clicks”. During the real estate run-up it was “real estate never goes down” and “subprime is contained”.
He describes his speculative entry into Ethereum in early 2016 and how it was a consequence of him interviewing David Seaman before he was famous. Jason’s since liquidated his crypto positions as he sees the greed / fear psychology tipping to extreme greed currently.
As exemplified in the screen-shot above taken tonight (courtesy of Coindesk), the Ethereum price chart is not representative of a natural market, although I’d comment that nothing is a natural market in the global economy at the moment. It’s interesting that Jason’s video show the same Coindesk plot as mine above and the price is $165.17 which represents a 14% increase from his recording to the writing of this post.
“There will eventually be a very very nasty correction” and since we’ve gone up so quickly, Jason sees a 40 – 60% pullback in the near future as possible. He admits that there is “very good innovation and tech behind Etherium” but cautions that the supply is not limited.
He also suggests that Ethereum lacks a “network effect” unlike the online gambling websites and ecommerce websites that use bitcoin. In these cases, the underlying demand is based on more than just speculation. Suggesting that Ethereum holders take some money off the table, Jason describes the contrarian top indicators that he’s observed.
Jason’s video can be viewed below and may be of interest in those speculative investors looking to take some money off the table or equally to those looking to jump into the current price explosion.