Archive for the ‘Investing’ Category

The IRS has now finally declared its official stance on Bitcoin: It is to be treated as a capital asset and not currency, yet will be saddled with currency regulations as well. The first and perhaps scariest bullet point is that any gain made on the value of Bitcoin now must be treated as a short-term capital gain (which could be taxed up to 35%!). So, for example, the early adopters who turned pennies into millions, upon cashing out, will owe millions in taxes. Lovely!

So, the onerous list of bullet points:

  • Bitcoin profits treated as short-term capital gains.
  • Mining of Bitcoins is treated as gross income.
  • Any payment in excess of $600 value must be reported.
  • Any payment of Bitcoins to a contractor must be reported and filed with a Form 1099-MISC.
  • Bitcoin payments may be subject to backup withholding.

You can read all the legalese ugliness here.

 

Thanks to LaserBob for the info.

As of writing:

Trading at a high of $1242 in the US markets, Bitcoin is only $10 short of meeting the 1-oz gold bullion spot price.

Will this be called “Bitcoin Black Friday?”

As of writing, 6888 Yuan/BTC. That’s USD$1130.

We’re exploring arbitrage opportunities as other exchanges lag at 834 and 724, respectively. More than 30% return per cycle, if you can catch it before it breaks, and have a way to move your money through China.

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Mighty Bitcoin tops $600.

Posted: November 18, 2013 in Investing, News
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Driven by the China market, Bitcoin topped US$600 this morning. $612 at the time of writing.

ExpatBob is pleased.

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Bitcoin Rampage

Posted: October 19, 2013 in Investing, News
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Bitcoin is on another bull run, after Baidu, China’s equivalent of Google, started accepting payments for services in Bitcoins a few days ago. This is welcome news, as it shows large-industry posturing to accept the cryptocurrency despite the USDOJ’s crusade to stomp it out at all costs.

Over the past couple of weeks, the Chilean Peso has dropped from about 472:1 CLP/USD ratio, to nearly 505:1 as of the time of writing.

Bad news for those of us, like myself, who changed a big batch of dollars to pesos not terribly long ago. Good news for those, like myself, who continue to earn in dollars.

 

Exchange tip, gold prices

Posted: June 3, 2013 in Investing, News
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Due to the discrepancy between the USD and CLP exchange rates and gold prices, you can now get Chilean gold coins for about CLP$420.000 for a 20,3-gram coin (USD$841), which makes its per-ounce price $1174. That’s the buy price, not spot.

Do with that what you will. Smells like buying opportunity.

 

NEVERMIND– I’ve been stymied by shite conversions. Disregard the whole thing. Thanks, Imperial Measurement Systems!

On the 14th of May, the Dolar Blue reached 100% higher than the official Argentine Peso exchange rate. The official rate of 5.22 Pesos/USD was dwarfed by the black-market rate of 10.45 Pesos/USD. It has since scaled back a bit to 9.4 as of writing.

What does this mean?

1. Argentina lies.

2. If you go on vacation in Argentina with US Dollars and change them through Arbolitos, you can have your vacation at half price. Party like a Rock Star.

Other examples abound. I have a travel agent in Argentina who plays the arbitrage between currencies, and I can save hundreds of dollars by booking flights through him if I pay in USD (we split the difference). He’s happy, I’m happy. This summer after I visit my mother in the USA, I will fly from Chicago to Indonesia, and then back again, for about USD$1800 round trip. Thanks, Kristina!

What does this mean for Argentina’s future?

1. They will devalue soon.

2. They will devalue soon.

3. They will devalue soon.

4. Argies are all using USD anyways despite the currency controls.

There’s no way around it. They will have to stop forcing people to go by an exchange rate that is twice as crappy as what folks are trading with now, and the only politically “viable” way to do it is to rob those who have saved in Pesos by chopping their currency off at the knees. Look for Chavez-style revaluation in the very near future.

This morning, Bitcoin topped $100 for the first time. Will it last? Nobody knows, but it’s definitely a sign of its growing popularity. Its latest rise has certainly attracted investors and technology innovators who are making tools for greater accessibility and usability, which only helps add to its popularity and usefulness.

Who’d have thought that in a world where every government is racing to the bottom of the barrel through currency inflation, a small opensource project to create a digital currency would experience explosive hyperdeflation? That’s what happens when you remove government meddling from the picture.

Go, go, mighty Bitcoin!

 

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Step 1: include a seller’s agent who lives the Vivo Sudamericano.

Step 2: watch the disaster unfold

I was shopping for beach property in order to assuage my hunger to be near the sea. Santiago is nice but I’m a water dog and require regular injections of saline in order to stay balanced. The mountains really don’t do anything for me, though the desert’s lack of human habitability I find slightly comforting.

I had found a beach property I quite liked, which was recommended to me by my friend CaliforniaBob (rest in peace) so with my lust for water and his mortality fresh in my head, I decided to pull the trigger and start enjoying it before I too dropped dead unexpectedly. The first time I had been down to see these particular parcels, I was impressed, and after having thought about it briefly, decided to go have another look. The second time I arrived, I went to see the lot I had my eye on.

“Oh, yeah. This one was sold.” said ChamulloBob. Hmm. Well, shit. The properties were being represented both by a local seller’s agent (ChamulloBob) and a partial-local buyer’s agent (a gringo who has been here in Chile for several years). Their deal was that they would split the commission on the sale. Fairly straightforward.

“What else have you got?” I asked.

“These other ones down here, let’s go see,” and so we went to look. As luck would have it, not just another lot, with better elevation and a better view of the bay, but its neighboring lot as well, both available and both for similar prices. After inquiring as to what the sellers were asking for them, I made up my mind. Both were asking some 8.5 million CLP each, which was a steal in my opinion, but my inner Jew had to haggle and see if I could bring the price down some.

“I’ll take them both. 8.5 is OK but see if they will take 8 first.”

And so, I assumed that my simple request would be followed, meaning that they would see if the seller would take 8, and if not, capitulate to their 8.5 asking price. Not rocket science.

And so a week passed and I heard nothing, then I get an email that they would not accept 8 and wanted 8.5. “OK.” Thinking that my simple instructions would be followed. Not rocket science.

Then several days pass and I get a note that one lot has an offer for 9. “Hmmm…” thinks my brain, “These lots have been sitting around for months with no buyers and all of a sudden, when I show interest, the magical mystical offers materialize.” Let me guess, it’s an invisible Argentine, who always manages to outdo my last offer by a little amount. Because that has happened, like, ALWAYS, in every single property negotiation we have done, ever, in South America, of which there have been many, and we’ve been there and done that and called them on it. Then, quickly, those magical Argentines stop coming to the bid table. Amazing!

Do you hear that, Argentina? Your people are being used as an excuse for other South American countries to pull the Vivo on price negotiations!

So I said this to my buyer’s agent, and I think he took it the wrong way and assumed I was accusing him of ripping me off, which was not the case. “I’m going to sit on my hands and watch what happens to this,” I told him, and so became an amused observer with an eye on the prize.

And so a few more days pass, and then we hear that the seller’s agent is selling it for 8.5, not 9, and they sign the papers tomorrow. Which is funny and sad, because that’s what I said I would pay for it. And I really wanted to two adjoining lots, so I’m not really interested in the other one anymore.

So, my INTJ brain ticks through this data and comes to the only calculable conclusion that ChamulloBob was acting as both a buyer’s and seller’s agent in this case, and screwed both me and my buyer’s agent over for the grand reward of a couple hundred bucks. Something about which I also hint to GringoRealtorBob, which I think might have made him more angry, because I haven’t heard back from him.

Then I realize that I did all that daily standing-in-line at a Uruguayan bank (which I know I will do plenty of when I am in Hell) for nothing…