A letter to a coin friend:
I have been in contact with this circle for nearly five or six years, and I have been in contact with the financial circle for almost 10 years, in fact, everything has changed, and they are all some financial Derivatives. Every era will produce some wealth code, or some wealth substitute that occupies everyone's mind. Here are two well-known examples of financial bubbles:
- Tulip Bubble: In the 17th century, a tulip sold for 90,000 guilders in the Netherlands, which is equivalent to the income of an average family for 300 years, or a top mansion in Amsterdam, the capital of the Netherlands. This phenomenon is due to the fact that the price of tulips is constantly rising, and people think that they can make money just by buying them. However, when one time the tulips were not sold, everyone began to sell the tulips, causing their price to fall from the highest to zero, triggering humanity's first financial crisis.
- Mississippi Bubble: Occurred shortly after the death of Louis XIV, the Sun King of France. After Louis XV succeeded to the throne, the French crown planned to alleviate France's debt problems through the issuance of paper money. In 1716, the French crown granted John Law permission to establish a banknote issuing bank, known as the Universal Bank. In 1717, John Law proposed the "Mississippi Plan", which promised investors huge profits and attracted the public's enthusiasm for investment. However, the money raised was not used to "mine gold", but to pay off the debts of the royal family. The unlimited issuance of banknotes caused severe inflation, investors began to be unable to exchange gold from the Royal Bank, and the banknotes depreciated sharply, causing the bubble to burst.
These cases remind people to stay calm when investing, avoid blindly following the herd, and at the same time, strengthen financial supervision to prevent the creation of financial bubbles.
It is better to teach people to fish than to teach them to fish, and I also hope that in the process of sharing, I can express my thinking, ideas, and logic, so that I can bring you different views and opinions. This line of work must be open-minded, maintain learning ability, K-line views, line marking, friends who must play for a few years, all understand some, but whether they can achieve the unity of knowledge, whether they can hold it, whether they can know what they think, and then realize it. This line of work requires a calm analysis, and it is necessary to overcome the weaknesses of human nature, fear of heights, being in a hurry to turn over the book, not being able to hold it, frequent operations, and so on. There is a lot of complicated and useless information in this industry every day, and it is necessary to sift through useful information and information that is helpful for trading. It then corresponds to our transactions. I hope that everyone can get some useful points of view from it, learn and grow together.
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