Editor’s note: In today’s Dispatch, we’re sharing another piece from our friend and colleague, Tom Dyson.
Tom’s one of the brightest analysts in the financial world – and when he discovers a money-making opportunity, he goes “all in.”
Regular readers know we’re big on gold – but Tom took it a step further. Two years ago, he put nearly all his money into the precious metal. And below, he shares how he bet thousands of dollars on bitcoin in 2011… just before it took off.
Recently, Tom pinpointed another opportunity… One that he believes will deliver once-in-20-years returns. And on Wednesday, May 20, he’s hosting an urgent briefing where he’ll share all the details. Go here to register for his free event – you don’t want to miss out.
By Tom Dyson, editor, Postcards From the Fringe
The place where you made your stand never mattered. Only that you were there… and still on your feet.
– Stephen King
I put my entire life savings into gold two years ago.
Not because I thought gold was going to rise. But because I thought stocks would fall, priced in gold, by more than 80%. And I wanted to buy those 80%-off stocks, whenever that may be.
In late 2018, stocks suddenly got marked down 15% (priced in gold). And I thought, “This is happening now.” So I bet even more on stocks falling…
The last time I got this feeling was in 2011, when I found bitcoin. I was in some internet forum for geeks and someone mentioned it. I looked it up. And the moment I saw what it was, I knew. I just knew.
It cost $6 at the time. There was only one place to buy it – a website in Japan called Mt. Gox. And it was a brute to get a hold of…
I had to open an account with a PayPal-type service to transfer the money. Then, I had to jump through hoops like sending faxes, passport copies, and bank details. The whole thing seemed like a scam.
But I wired $5,000. Which was a lot of money for a guy, with three babies, who was still trying to make it in the world.
Then, I wired another $5,000. And another. Then, bitcoin jumped higher. And I thought, “This is happening.” So I wired another $10,000, which was enough.
I withdrew all my bitcoin – I had 3,330 of them – and transferred them to thumb drives via an internet airlock I set up using Linux, so they couldn’t be intercepted by online thieves.
Next, I made duplicates of the thumb drives, in case they broke, got corrupted, or burned in a fire. I encrypted them. And then, I hid them in two secret locations.
Meanwhile, I’m a big mouth about this sort of thing. I told anyone who’d listen to buy bitcoin. I even started giving them away.
I gave one to anyone who came to my office, including Bill Bonner – I gave him a physical version of bitcoin called Casascius. And I gave them to my friends, Michael Checkan – co-founder of Asset Strategies International – and Swen Lorenz, an investment blogger.
I must have recommended it publicly, although I don’t remember doing so, because Chris Weber – who pens the Chris Weber Education blog – forwarded me a note from one of his readers recently:
I found this post from Tom Dyson on Facebook a few days ago… (I’m not FB “friends” with him, but I do read anything he posts as he pointed out bitcoin when it was like $15 or something crazy cheap…)
“With the Rupee near all-time lows against the dollar, India feels very cheap to us. We’ve been here a week already and we’ve only spent $180.
“Our hotel is $14 a night. Our meals are $3. Tuk Tuk rides are less than a dollar. A big bottle of water is 15 cents and a freshly squeezed juice or smoothie is 50 cents.
“Here we are in Jaisalmer, the city-inside-a-castle in the far northwest of India near the border with Pakistan…”
As an investor, THIS is what I love reading… and it instantly makes me want to drop everything I’m doing, travel to India, and see for myself! On one side of the world (USA), you’ve got a 9% default rate on subprime car loans. And on the other, you’ve apparently got a genuine bargain… so fascinating!
I also went shopping on the darknet, and I sent packages of cannabis lollipops and Rice Krispies Treats to friends all over the world, paid for with bitcoin.
You know what happened next. The price went crazy, and my investment turned into $1 million. And I thought, “That’s enough. I’m out.” So I sold all my bitcoin. After taxes, bitcoin volatility, and Mt. Gox’s insolvency, I ended up with about a $500,000 profit… and a lot of pot lollipops.
I should have held on. The bitcoin I had would be worth tens of millions of dollars today…
Which brings me back to stocks falling in terms of gold. It’s a little different, but I got the same feeling about it as I had with bitcoin.
I put an irresponsibly large investment into it. I told my brothers and my parents to sell their index funds and buy gold. Then I started writing about it in my Postcards From the Fringe e-letter…
As I write, the Dow-to-Gold ratio – which tracks the Dow Jones stocks as priced in gold – is around 14. I won’t sell my gold until it falls below 5.
Editor, Postcards From the Fringe
P.S. While the stock market was hitting all-time highs last year, I was keeping a close eye on a rare investment that I knew would shake up the financial world. Today, I believe it offers a once-in-20-years opportunity for investors…
And on Wednesday, May 20, I’m holding a special presentation where I’ll share exactly how you can take advantage. Click here now to register for my free event. This could be your last chance to get in.