Investing in particular ways during a financial bubble, in this case Cryptocurrency, is a good way to lose a lot of money but it also gives us amazing insight into the nature of greed. If we analyze and understand human nature during these events there is money to be made. Today let’s talk about Long Island Iced Tea Corp.

That company specializes in selling non-alcoholic beverages. What, you might ask, does this have to do with cryptocurrency? Good question. The answer is nothing. Nevertheless, the officers of the company decided to change the name to Long Blockchain and claim to be refocusing on businesses using something called blockchain. This technology is an integral part of cryptocurrency. We need not understand the particulars.

Immediately upon rebranding the company stock soared to unseen heights. What this means is people saw the name change and, in the mania surrounding cryptocurrency, immediately purchased shares. Now, the money people use to buy the stock has to come from someplace. Perhaps their saving account or their child’s education fund. The assumption of the purchaser is that, like other cryptocurrency companies, the value will rise dramatically. They hope the stock price will continue to rise and they will eventually sell their shares for an enormous profit.

There is some reality to these desires. Those who buy low and sell high stand to make a lot of money. The danger is you don’t know exactly what is low or what will be high. It’s entirely possible Long Blockchain has already reached its peak price, that anyone purchasing now will lose a lot of money. This does not dissuade the speculative investor. It is something that can be taken advantage of by a wise investor.

When perception is not aligned with reality mistakes will be made. This is clearly what is happening with cryptocurrency speculation and Long Blockchain. The company is a tea company. They have an infrastructure designed to manufacture and distribute tea. They are not well-positioned to function in competition with existing blockchain companies.

Now, I will get to the point of all this. In the same way Long Blockchain knows little or nothing about blockchain technology, the average investor, you, knows little or nothing about the nuances of the market. You see something interesting and make a purchase. In the same way Long Blockchain is most likely doomed to failure, so is the average investor. The women and men who know something about investing, who can properly take into account perception and reality; are brokers. They can help you invest your money wisely. They can take advantage of misperception without so easily falling prey to it.

The lure of easy money is almost always false and the people most vulnerable are those who have the smallest disposable income. In essence, the Middle Class. The poor cannot invest at all and the wealthy have financial advisors.

You say to yourself it’s just a bit of money and there is the chance to get rich. The same applies to purchasing lottery tickets. It’s your money, do with it as you will. I’d advise you to get sound financial advice and avoid get rich quick purchases like Long Blockchain. If not, well, my financial team is happy to take your money and I’m thrilled to pay them for doing so.

Tom Liberman